[Title 42 CFR ]
[Code of Federal Regulations (annual edition) - October 1, 2019 Edition]
[From the U.S. Government Publishing Office]
[[Page i]]
Title 42
Public Health
________________________
Parts 414 to 429
Revised as of October 1, 2019
Containing a codification of documents of general
applicability and future effect
As of October 1, 2019
Published by the Office of the Federal Register
National Archives and Records Administration as a
Special Edition of the Federal Register
[[Page ii]]
U.S. GOVERNMENT OFFICIAL EDITION NOTICE
Legal Status and Use of Seals and Logos
The seal of the National Archives and Records Administration
(NARA) authenticates the Code of Federal Regulations (CFR) as
the official codification of Federal regulations established
under the Federal Register Act. Under the provisions of 44
U.S.C. 1507, the contents of the CFR, a special edition of the
Federal Register, shall be judicially noticed. The CFR is
prima facie evidence of the original documents published in
the Federal Register (44 U.S.C. 1510).
It is prohibited to use NARA's official seal and the stylized Code
of Federal Regulations logo on any republication of this
material without the express, written permission of the
Archivist of the United States or the Archivist's designee.
Any person using NARA's official seals and logos in a manner
inconsistent with the provisions of 36 CFR part 1200 is
subject to the penalties specified in 18 U.S.C. 506, 701, and
1017.
Use of ISBN Prefix
This is the Official U.S. Government edition of this publication
and is herein identified to certify its authenticity. Use of
the 0-16 ISBN prefix is for U.S. Government Publishing Office
Official Editions only. The Superintendent of Documents of the
U.S. Government Publishing Office requests that any reprinted
edition clearly be labeled as a copy of the authentic work
with a new ISBN.
U . S . G O V E R N M E N T P U B L I S H I N G O F F I C E
------------------------------------------------------------------
U.S. Superintendent of Documents Washington, DC
20402-0001
http://bookstore.gpo.gov
Phone: toll-free (866) 512-1800; DC area (202) 512-1800
[[Page iii]]
Table of Contents
Page
Explanation................................................. v
Title 42:
Chapter IV--Centers for Medicare & Medicaid
Services, Department of Health and Human Services
(Continued) 3
Finding Aids:
Table of CFR Titles and Chapters........................ 1065
Alphabetical List of Agencies Appearing in the CFR...... 1085
List of CFR Sections Affected........................... 1095
[[Page iv]]
----------------------------
Cite this Code: CFR
To cite the regulations in
this volume use title,
part and section number.
Thus, 42 CFR 414.1 refers
to title 42, part 414,
section 1.
----------------------------
[[Page v]]
EXPLANATION
The Code of Federal Regulations is a codification of the general and
permanent rules published in the Federal Register by the Executive
departments and agencies of the Federal Government. The Code is divided
into 50 titles which represent broad areas subject to Federal
regulation. Each title is divided into chapters which usually bear the
name of the issuing agency. Each chapter is further subdivided into
parts covering specific regulatory areas.
Each volume of the Code is revised at least once each calendar year
and issued on a quarterly basis approximately as follows:
Title 1 through Title 16.................................as of January 1
Title 17 through Title 27..................................as of April 1
Title 28 through Title 41...................................as of July 1
Title 42 through Title 50................................as of October 1
The appropriate revision date is printed on the cover of each
volume.
LEGAL STATUS
The contents of the Federal Register are required to be judicially
noticed (44 U.S.C. 1507). The Code of Federal Regulations is prima facie
evidence of the text of the original documents (44 U.S.C. 1510).
HOW TO USE THE CODE OF FEDERAL REGULATIONS
The Code of Federal Regulations is kept up to date by the individual
issues of the Federal Register. These two publications must be used
together to determine the latest version of any given rule.
To determine whether a Code volume has been amended since its
revision date (in this case, October 1, 2019), consult the ``List of CFR
Sections Affected (LSA),'' which is issued monthly, and the ``Cumulative
List of Parts Affected,'' which appears in the Reader Aids section of
the daily Federal Register. These two lists will identify the Federal
Register page number of the latest amendment of any given rule.
EFFECTIVE AND EXPIRATION DATES
Each volume of the Code contains amendments published in the Federal
Register since the last revision of that volume of the Code. Source
citations for the regulations are referred to by volume number and page
number of the Federal Register and date of publication. Publication
dates and effective dates are usually not the same and care must be
exercised by the user in determining the actual effective date. In
instances where the effective date is beyond the cut-off date for the
Code a note has been inserted to reflect the future effective date. In
those instances where a regulation published in the Federal Register
states a date certain for expiration, an appropriate note will be
inserted following the text.
OMB CONTROL NUMBERS
The Paperwork Reduction Act of 1980 (Pub. L. 96-511) requires
Federal agencies to display an OMB control number with their information
collection request.
[[Page vi]]
Many agencies have begun publishing numerous OMB control numbers as
amendments to existing regulations in the CFR. These OMB numbers are
placed as close as possible to the applicable recordkeeping or reporting
requirements.
PAST PROVISIONS OF THE CODE
Provisions of the Code that are no longer in force and effect as of
the revision date stated on the cover of each volume are not carried.
Code users may find the text of provisions in effect on any given date
in the past by using the appropriate List of CFR Sections Affected
(LSA). For the convenience of the reader, a ``List of CFR Sections
Affected'' is published at the end of each CFR volume. For changes to
the Code prior to the LSA listings at the end of the volume, consult
previous annual editions of the LSA. For changes to the Code prior to
2001, consult the List of CFR Sections Affected compilations, published
for 1949-1963, 1964-1972, 1973-1985, and 1986-2000.
``[RESERVED]'' TERMINOLOGY
The term ``[Reserved]'' is used as a place holder within the Code of
Federal Regulations. An agency may add regulatory information at a
``[Reserved]'' location at any time. Occasionally ``[Reserved]'' is used
editorially to indicate that a portion of the CFR was left vacant and
not dropped in error.
INCORPORATION BY REFERENCE
What is incorporation by reference? Incorporation by reference was
established by statute and allows Federal agencies to meet the
requirement to publish regulations in the Federal Register by referring
to materials already published elsewhere. For an incorporation to be
valid, the Director of the Federal Register must approve it. The legal
effect of incorporation by reference is that the material is treated as
if it were published in full in the Federal Register (5 U.S.C. 552(a)).
This material, like any other properly issued regulation, has the force
of law.
What is a proper incorporation by reference? The Director of the
Federal Register will approve an incorporation by reference only when
the requirements of 1 CFR part 51 are met. Some of the elements on which
approval is based are:
(a) The incorporation will substantially reduce the volume of
material published in the Federal Register.
(b) The matter incorporated is in fact available to the extent
necessary to afford fairness and uniformity in the administrative
process.
(c) The incorporating document is drafted and submitted for
publication in accordance with 1 CFR part 51.
What if the material incorporated by reference cannot be found? If
you have any problem locating or obtaining a copy of material listed as
an approved incorporation by reference, please contact the agency that
issued the regulation containing that incorporation. If, after
contacting the agency, you find the material is not available, please
notify the Director of the Federal Register, National Archives and
Records Administration, 8601 Adelphi Road, College Park, MD 20740-6001,
or call 202-741-6010.
CFR INDEXES AND TABULAR GUIDES
A subject index to the Code of Federal Regulations is contained in a
separate volume, revised annually as of January 1, entitled CFR Index
and Finding Aids. This volume contains the Parallel Table of Authorities
and Rules. A list of CFR titles, chapters, subchapters, and parts and an
alphabetical list of agencies publishing in the CFR are also included in
this volume.
An index to the text of ``Title 3--The President'' is carried within
that volume.
[[Page vii]]
The Federal Register Index is issued monthly in cumulative form.
This index is based on a consolidation of the ``Contents'' entries in
the daily Federal Register.
A List of CFR Sections Affected (LSA) is published monthly, keyed to
the revision dates of the 50 CFR titles.
REPUBLICATION OF MATERIAL
There are no restrictions on the republication of material appearing
in the Code of Federal Regulations.
INQUIRIES
For a legal interpretation or explanation of any regulation in this
volume, contact the issuing agency. The issuing agency's name appears at
the top of odd-numbered pages.
For inquiries concerning CFR reference assistance, call 202-741-6000
or write to the Director, Office of the Federal Register, National
Archives and Records Administration, 8601 Adelphi Road, College Park, MD
20740-6001 or e-mail [email protected].
SALES
The Government Publishing Office (GPO) processes all sales and
distribution of the CFR. For payment by credit card, call toll-free,
866-512-1800, or DC area, 202-512-1800, M-F 8 a.m. to 4 p.m. e.s.t. or
fax your order to 202-512-2104, 24 hours a day. For payment by check,
write to: US Government Publishing Office - New Orders, P.O. Box 979050,
St. Louis, MO 63197-9000.
ELECTRONIC SERVICES
The full text of the Code of Federal Regulations, the LSA (List of
CFR Sections Affected), The United States Government Manual, the Federal
Register, Public Laws, Public Papers of the Presidents of the United
States, Compilation of Presidential Documents and the Privacy Act
Compilation are available in electronic format via www.govinfo.gov. For
more information, contact the GPO Customer Contact Center, U.S.
Government Publishing Office. Phone 202-512-1800, or 866-512-1800 (toll-
free). E-mail, [email protected].
The Office of the Federal Register also offers a free service on the
National Archives and Records Administration's (NARA) website for public
law numbers, Federal Register finding aids, and related information.
Connect to NARA's website at www.archives.gov/federal-register.
The e-CFR is a regularly updated, unofficial editorial compilation
of CFR material and Federal Register amendments, produced by the Office
of the Federal Register and the Government Publishing Office. It is
available at www.ecfr.gov.
Oliver A. Potts,
Director,
Office of the Federal Register
October 1, 2019.
[[Page ix]]
THIS TITLE
Title 42--Public Health is composed of five volumes. The parts in
these volumes are arranged in the following order: Parts 1-399, parts
400-413, parts 414-429, parts 430-481, and part 482 to end. The first
volume (parts 1-399) contains current regulations issued under chapter
I--Public Health Service (HHS). The second, third, and fourth volumes
(parts 400-413, parts 414-429, and parts 430-481) include regulations
issued under chapter IV--Centers for Medicare & Medicaid Services (HHS)
and the fifth volume (part 482 to end) contains the remaining
regulations in chapter IV and the regulations issued under chapter V by
the Office of Inspector General-Health Care (HHS). The contents of these
volumes represent all current regulations codified under this title of
the CFR as of October 1, 2019.
For this volume, Susannah C. Hurley was Chief Editor. The Code of
Federal Regulations publication program is under the direction of John
Hyrum Martinez, assisted by Stephen J. Frattini.
[[Page 1]]
TITLE 42--PUBLIC HEALTH
(This book contains parts 414 to 429)
--------------------------------------------------------------------
Part
chapter iv--Centers for Medicare & Medicaid Services,
Department of Health and Human Services (Continued)....... 414
[[Page 3]]
CHAPTER IV--CENTERS FOR MEDICARE & MEDICAID SERVICES, DEPARTMENT OF
HEALTH AND HUMAN SERVICES (CONTINUED)
--------------------------------------------------------------------
Editorial Note: Nomenclature changes to chapter IV appear at 62 FR
46037, Aug. 29, 1997; 66 FR 39452, July 31, 2001; and 67 FR 36540, May
24, 2002.
SUBCHAPTER B--MEDICARE PROGRAM (CONTINUED)
Part Page
414 Payment for Part B medical and other health
services................................ 5
415 Services furnished by physicians in
providers, supervising physicians in
teaching settings, and residents in
certain settings........................ 207
416 Ambulatory surgical services................ 225
417 Health maintenance organizations,
competitive medical plans, and health
care prepayment plans................... 254
418 Hospice care................................ 336
419 Prospective payment system for hospital
outpatient department services.......... 385
420 Program integrity: Medicare................. 406
421 Medicare contracting........................ 416
422 Medicare advantage program.................. 431
423 Voluntary medicare prescription drug benefit 643
424 Conditions for Medicare payment............. 872
425 Medicare shared savings program............. 950
426 Review of national coverage determinations
and local coverage determinations....... 1036
427-429
[Reserved]
[[Page 5]]
SUBCHAPTER B_MEDICARE PROGRAM (CONTINUED)
PART 414_PAYMENT FOR PART B MEDICAL AND OTHER HEALTH SERVICES--
Table of Contents
Subpart A_General Provisions
Sec.
414.1 Basis and scope.
414.2 Definitions.
414.4 Fee schedule areas.
414.5 Hospital services paid under Medicare Part B when a Part A
hospital inpatient claim is denied because the inpatient
admission was not reasonable and necessary, but hospital
outpatient services would have been reasonable and necessary
in treating the beneficiary.
Subpart B_Physicians and Other Practitioners
414.20 Formula for computing fee schedule amounts.
414.21 Medicare payment basis.
414.22 Relative value units (RVUs).
414.24 Publication of RVUs and direct PE inputs.
414.26 Determining the GAF.
414.28 Conversion factors.
414.30 Conversion factor update.
414.34 Payment for services and supplies incident to a physician's
service.
414.36 Payment for drugs incident to a physician's service.
414.39 Special rules for payment of care plan oversight.
414.40 Coding and ancillary policies.
414.42 Adjustment for first 4 years of practice.
414.44 Transition rules.
414.46 Additional rules for payment of anesthesia services.
414.48 Limits on actual charges of nonparticipating suppliers.
414.50 Physician or other supplier billing for diagnostic tests
performed or interpreted by a physician who does not share a
practice with the billing physician or other supplier.
414.52 Payment for physician assistants' services.
414.54 Payment for certified nurse-midwives' services.
414.56 Payment for nurse practitioners' and clinical nurse specialists'
services.
414.58 Payment of charges for physician services to patients in
providers.
414.60 Payment for the services of CRNAs.
414.61 Payment for anesthesia services furnished by a teaching CRNA.
414.62 Fee schedule for clinical psychologist services.
414.63 Payment for outpatient diabetes self-management training.
414.64 Payment for medical nutrition therapy.
414.65 Payment for telehealth services.
414.66 Incentive payments for physician scarcity areas.
414.67 Incentive payments for services furnished in Health Professional
Shortage Areas.
414.68 Imaging accreditation.
414.80 Incentive payment for primary care services.
414.84 Payment for MDPP services.
414.90 Physician Quality Reporting System (PQRS).
414.92 Electronic Prescribing Incentive Program.
414.94 Appropriate use criteria for advanced diagnostic imaging
services.
Subpart C_Fee Schedules for Parenteral and Enteral Nutrition (PEN)
Nutrients, Equipment and Supplies, Splints, Casts, and Certain
Intraocular Lenses (IOLs)
414.100 Purpose.
414.102 General payment rules.
414.104 PEN Items and Services.
414.105 Application of competitive bidding information.
414.106 Splints and casts.
414.108 IOLs inserted in a physician's office.
Subpart D_Payment for Durable Medical Equipment and Prosthetic and
Orthotic Devices
414.200 Purpose.
414.202 Definitions.
414.210 General payment rules.
414.220 Inexpensive or routinely purchased items.
414.222 Items requiring frequent and substantial servicing.
414.224 Customized items.
414.226 Oxygen and oxygen equipment.
414.228 Prosthetic and orthotic devices.
414.229 Other durable medical equipment--capped rental items.
414.230 Determining a period of continuous use.
414.232 Special payment rules for transcutaneous electrical nerve
stimulators (TENS).
414.234 Prior authorization for items frequently subject to unnecessary
utilization.
Subpart E_Determination of Reasonable Charges Under the ESRD Program
414.300 Scope of subpart.
[[Page 6]]
414.310 Determination of reasonable charges for physician services
furnished to renal dialysis patients.
414.313 Initial method of payment.
414.314 Monthly capitation payment method.
414.316 Payment for physician services to patients in training for self-
dialysis and home dialysis.
414.320 Determination of reasonable charges for physician renal
transplantation services.
414.330 Payment for home dialysis equipment, supplies, and support
services.
414.335 Payment for EPO furnished to a home dialysis patient for use in
the home.
Subpart F_Competitive Bidding for Certain Durable Medical Equipment,
Prosthetics, Orthotics, and Supplies (DMEPOS)
414.400 Purpose and basis.
414.402 Definitions.
414.404 Scope and applicability.
414.406 Implementation of programs.
414.408 Payment rules.
414.409 Special payment rules.
414.410 Phased-in implementation of competitive bidding programs.
414.411 Special rule in case of competitions for diabetic testing strips
conducted on or after January 1, 2011.
414.412 Submission of bids under a competitive bidding program.
414.414 Conditions for awarding contracts.
414.416 Determination of competitive bidding payment amounts.
414.418 Opportunity for networks.
414.420 Physician or treating practitioner authorization and
consideration of clinical efficiency and value of items.
414.422 Terms of contracts.
414.423 Appeals process for breach of a DMEPOS competitive bidding
program contract actions.
414.424 Administrative or judicial review.
414.425 Claims for damages.
414.426 Adjustments to competitively bid payment amounts to reflect
changes in the HCPCS.
Subpart G_Payment for Clinical Diagnostic Laboratory Tests
414.500 Basis and scope.
414.502 Definitions.
414.504 Data reporting requirements.
414.506 Procedures for public consultation for payment for a new
clinical diagnostic laboratory test.
414.507 Payment for clinical diagnostic laboratory tests.
414.508 Payment for a new clinical diagnostic laboratory test.
414.509 Reconsideration of basis for and amount of payment for a new
clinical diagnostic laboratory test.
414.510 Laboratory date of service for clinical laboratory and pathology
specimens.
414.522 Payment for new advanced diagnostic laboratory tests.
Subpart H_Fee Schedule for Ambulance Services
414.601 Purpose.
414.605 Definitions.
414.610 Basis of payment.
414.615 Transition to the ambulance fee schedule.
414.617 Transition from regional to national ambulance fee schedule.
414.620 Publication of the ambulance fee schedule.
414.625 Limitation on review.
Subpart I_Payment for Drugs and Biologicals
414.701 Purpose.
414.704 Definitions.
414.707 Basis of payment.
Subpart J_Submission of Manufacturer's Average Sales Price Data
414.800 Purpose.
414.802 Definitions.
414.804 Basis of payment.
414.806 Penalties associated with the failure to submit timely and
accurate ASP data.
Subpart K_Payment for Drugs and Biologicals Under Part B
414.900 Basis and scope.
414.902 Definitions.
414.904 Average sales price as the basis for payment.
414.906 Competitive acquisition program as the basis for payment.
414.908 Competitive acquisition program.
414.910 Bidding process.
414.912 Conflicts of interest.
414.914 Terms of contract.
414.916 Dispute resolution for vendors and beneficiaries.
414.917 Dispute resolution and process for suspension or termination of
approved CAP contract and termination of physician
participation under exigent circumstances.
414.918 Assignment.
414.920 Judicial review.
414.930 Compendia for determination of medically-accepted indications
for off-label uses of drugs and biologicals in an anti-cancer
chemotherapeutic regimen.
Subpart L_Supplying and Dispensing Fees
414.1000 Purpose.
[[Page 7]]
414.1001 Basis of Payment.
Subpart M_Payment for Comprehensive Outpatient Rehabilitation Facility
(CORF) Services
414.1100 Basis and scope.
414.1105 Payment for Comprehensive Outpatient Rehabilitation Facility
(CORF) services.
Subpart N_Value-Based Payment Modifier Under the Physician Fee Schedule
414.1200 Basis and scope.
414.1205 Definitions.
414.1210 Application of the value-based payment modifier.
414.1215 Performance and payment adjustment periods for the value-based
payment modifier.
414.1220 Reporting mechanisms for the value-based payment modifier.
414.1225 Alignment of Physician Quality Reporting System quality
measures and quality measures for the value-based payment
modifier.
414.1230 Additional measures for groups and solo practitioners.
414.1235 Cost measures.
414.1240 Attribution for quality of care and cost measures.
414.1245 Scoring methods for the value-based payment modifier using the
quality-tiering approach.
414.1250 Benchmarks for quality of care measures.
414.1255 Benchmarks for cost measures.
414.1260 Composite scores.
414.1265 Reliability of measures.
414.1270 Determination and calculation of Value-Based Payment Modifier
adjustments.
414.1275 Value-based payment modifier quality-tiering scoring
methodology.
414.1280 Limitation on review.
414.1285 Informal inquiry process.
Subpart O_Merit-Based Incentive Payment System and Alternative Payment
Model Incentive
414.1300 Basis and scope.
414.1305 Definitions.
414.1310 Applicability.
414.1315 Virtual groups.
414.1320 MIPS performance period.
414.1325 Data submission requirements.
414.1330 Quality performance category.
414.1335 Data submission criteria for the quality performance category.
414.1340 Data completeness criteria for the quality performance
category.
414.1350 Cost performance category.
414.1355 Improvement activities performance category.
414.1360 Data submission criteria for the improvement activities
performance category.
414.1370 APM scoring standard under MIPS.
414.1375 Promoting Interoperability (PI) performance category.
414.1380 Scoring.
414.1385 Targeted review and review limitations.
414.1390 Data validation and auditing.
414.1395 Public reporting.
414.1400 Third party intermediaries.
414.1405 Payment.
414.1410 Advanced APM determination.
414.1415 Advanced APM criteria.
414.1420 Other payer advanced APM criteria.
414.1425 Qualifying APM participant determination: In general.
414.1430 Qualifying APM participant determination: QP and partial QP
thresholds.
414.1435 Qualifying APM participant determination: Medicare option.
414.1440 Qualifying APM participant determination: All-payer combination
option.
414.1445 Determination of other payer advanced APMs.
414.1450 APM incentive payment.
414.1455 Limitation on review.
414.1460 Monitoring and program integrity.
414.1465 Physician-focused payment models.
Authority: 42 U.S.C. 1302, 1395hh, and 1395rr(b)(l).
Source: 55 FR 23441, June 8, 1990, unless otherwise noted.
Editorial Note: Nomenclature changes to part 414 appear at 60 FR
50442, Sept. 29, 1995, and 60 FR 53877, Oct. 18, 1995.
Subpart A_General Provisions
Sec. 414.1 Basis and scope.
This part implements the following provisions of the Act:
1802--Rules for private contracts by Medicare beneficiaries.
1833--Rules for payment for most Part B services.
1834(a) and (h)--Amounts and frequency of payments for durable
medical equipment and for prosthetic devices and orthotics and
prosthetics.
1834(l)--Establishment of a fee schedule for ambulance services.
1834(m)--Rules for Medicare reimbursement for telehealth services.
1834A--Improving policies for clinical diagnostic laboratory tests
1842(o)--Rules for payment of certain drugs and biologicals.
1847(a) and (b)--Competitive bidding for certain durable medical
equipment, prosthetics, orthotics, and supplies (DMEPOS).
1848--Fee schedule for physician services.
[[Page 8]]
1881(b)--Rules for payment for services to ESRD beneficiaries.
1887--Payment of charges for physician services to patients in
providers.
[67 FR 9132, Feb. 27, 2002, as amended at 69 FR 1116, Jan. 7, 2004; 71
FR 48409, Aug. 18, 2006; 81 FR 41098, June 23, 2016]
Sec. 414.2 Definitions.
As used in this part, unless the context indicates otherwise--
AA stands for anesthesiologist assistant.
AHPB stands for adjusted historical payment basis.
CF stands for conversion factor.
CRNA stands for certified registered nurse anesthetist.
CY stands for calendar year.
FY stands for fiscal year.
GAF stands for geographic adjustment factor.
GPCI stands for geographic practice cost index.
HCPCS stands for CMS Common Procedure Coding System.
Health Professional Shortage Area (HPSA) means an area designated
under section 332(a)(1)(A) of the Public Health Service Act as
identified by the Secretary prior to the beginning of such year.
Major surgical procedure means a surgical procedure for which a 10-
day or 90-day global period is used for payment under the physician fee
schedule and section 1848(b) of the Act.
Physician services means the following services to the extent that
they are covered by Medicare:
(1) Professional services of doctors of medicine and osteopathy
(including osteopathic practitioners), doctors of optometry, doctors of
podiatry, doctors of dental surgery and dental medicine, and
chiropractors.
(2) Supplies and services covered ``incident to'' physician services
(excluding drugs as specified in Sec. 414.36).
(3) Outpatient physical and occupational therapy services if
furnished by a person or an entity that is not a Medicare provider of
services as defined in Sec. 400.202 of this chapter.
(4) Diagnostic x-ray tests and other diagnostic tests (excluding
diagnostic laboratory tests paid under the fee schedule established
under section 1833(h) of the Act).
(5) X-ray, radium, and radioactive isotope therapy, including
materials and services of technicians.
(6) Antigens, as described in section 1861(s)(2)(G) of the Act.
(7) Bone mass measurement.
RVU stands for relative value unit.
(8) Screening mammography services.
[56 FR 59624, Nov. 25, 1991, as amended at 57 FR 42492, Sept. 15, 1992;
58 FR 63686, Dec. 2, 1993; 59 FR 63463, Dec. 8, 1994; 60 FR 63177, Dec.
8, 1995; 63 FR 34328, June 24, 1998; 66 FR 55322, Nov. 1, 2001; 75 FR
73616, Nov. 29, 2010]
Sec. 414.4 Fee schedule areas.
(a) General. CMS establishes physician fee schedule areas that
generally conform to the geographic localities in existence before
January 1, 1992.
(b) Changes. CMS announces proposed changes to fee schedule areas in
the Federal Register and provides an opportunity for public comment.
After considering public comments, CMS publishes the final changes in
the Federal Register.
[59 FR 63463, Dec. 8, 1994]
Sec. 414.5 Hospital services paid under Medicare Part B when a Part A
hospital inpatient claim is denied because the inpatient admission
was not reasonable and necessary, but hospital outpatient services would have
been reasonable and necessary in treating the beneficiary.
(a) If a Medicare Part A claim for inpatient hospital services is
denied because the inpatient admission was not reasonable and necessary,
or if a hospital determines under Sec. 482.30(d) of this chapter or
Sec. 485.641 of this chapter after a beneficiary is discharged that the
beneficiary's inpatient admission was not reasonable and necessary, the
hospital may be paid for any of the following Part B inpatient services
that would have been reasonable and necessary if the beneficiary had
been treated as a hospital outpatient rather than admitted as an
inpatient, provided the beneficiary is enrolled in Medicare Part B:
(1) Services described in Sec. 419.21(a) of this chapter that do
not require an outpatient status.
[[Page 9]]
(2) Physical therapy services, speech-language pathology services,
and occupational therapy services.
(3) Ambulance services, as described in section 1861(v)(1)(U) of the
Act, or, if applicable, the fee schedule established under section
1834(l) of Act.
(4) Except as provided in Sec. 419.2(b)(11) of this chapter,
prosthetic devices, prosthetics, prosthetic supplies, and orthotic
devices.
(5) Except as provided in Sec. 419.2(b)(10) of this chapter,
durable medical equipment supplied by the hospital for the patient to
take home.
(6) Clinical diagnostic laboratory services.
(7)(i) Effective December 8, 2003, screening mammography services;
and
(ii) Effective January 1, 2005, diagnostic mammography services.
(8) Effective January 1, 2011, annual wellness visit providing
personalized prevention plan services as defined in Sec. 410.15 of this
chapter.
(b) If a Medicare Part A claim for inpatient hospital services is
denied because the inpatient admission was not reasonable and necessary,
or if a hospital determines under Sec. 482.30(d) of this chapter or
Sec. 485.641 of this chapter after a beneficiary is discharged that the
beneficiary's inpatient admission was not reasonable and necessary, the
hospital may be paid for hospital outpatient services described in Sec.
412.2(c)(5), Sec. 412.405, Sec. 412.540, or Sec. 412.604(f) of this
chapter or Sec. 413.40(c)(2) of this chapter that are furnished to the
beneficiary prior to the point of inpatient admission (that is, the
inpatient admission order).
(c) The claims for the Part B services filed under the circumstances
described in this section must be filed in accordance with the time
limits for filing claims specified in Sec. 424.44(a) of this chapter.
[78 FR 50968, Aug. 19, 2013]
Subpart B_Physicians and Other Practitioners
Source: 56 FR 59624, Nov. 25, 1991; 57 FR 42492, Sept. 15, 1992,
unless otherwise noted.
Sec. 414.20 Formula for computing fee schedule amounts.
(a) Participating supplier. The fee schedule amount for a
participating supplier for a physician service as defined in Sec. 414.2
is computed as the product of the following amounts:
(1) The RVUs for the service.
(2) The GAF for the fee schedule area.
(3) The CF.
(b) Nonparticipating supplier. The fee schedule amount for a
nonparticipating supplier for a physician service as defined in Sec.
414.2 is 95 percent of the fee schedule amount as calculated in
paragraph (a) of this section.
[62 FR 59101, Oct. 31, 1997]
Sec. 414.21 Medicare payment basis.
Medicare payment is based on the lesser of the actual charge or the
applicable fee schedule amount.
[62 FR 59101, Oct. 31, 1997]
Sec. 414.22 Relative value units (RVUs).
CMS establishes RVUs for physicians' work, practice expense, and
malpractice insurance.
(a) Physician work RVUs--(1) General rule. Physician work RVUs are
established using a relative value scale in which the value of physician
work for a particular service is rated relative to the value of work for
other physician services.
(2) Special RVUs for anesthesia and radiology services)--(i)
Anesthesia services. The rules for determining RVUs for anesthesia
services are set forth in Sec. 414.46.
(ii) Radiology services. CMS bases the RVUs for all radiology
services on the relative value scale developed under section
1834(b)(1)(A) of the Act, with appropriate modifications to ensure that
the RVUs established for radiology services that are similar or related
to other physician services are consistent with the RVUs established for
those similar or related services.
(b) Practice expense RVUs. (1) Practice expense RVUs are computed
for each service or class of service by applying average historical
practice cost percentages to the estimated average allowed charge during
the 1991 base period.
[[Page 10]]
(2) The average practice expense percentage for a service or class
of services is computed as follows:
(i) Multiply the average practice expense percentage for each
specialty by the proportion of a particular service or class of service
performed by that specialty.
(ii) Add the products for all specialties.
(3) For services furnished beginning calendar year (CY) 1994, for
which 1994 practice expense RVUs exceed 1994 work RVUs and that are
performed in office settings less than 75 percent of the time, the 1994,
1995, and 1996 practice expense RVUs are reduced by 25 percent of the
amount by which they exceed the number of 1994 work RVUs. Practice
expense RVUs are not reduced to less than 128 percent of 1994 work RVUs.
(4) For services furnished beginning January 1, 1998, practice
expense RVUs for certain services are reduced to 110 percent of the work
RVUs for those services. The following two categories of services are
excluded from this limitation:
(i) The service is provided more than 75 percent of the time in an
office setting; or
(ii) The service is one described in section 1848(c)(2)(G)(v) of the
Act, codified at 42 U.S.C. 1395w-4(c)(2)(G). Section 1848(c)(2)(G)(v) of
the Act refers to the 1998 proposed resource-based practice expense RVUs
(as specified in the June 18, 1997 physician fee schedule proposed rule
(62 FR 33158)) for the specific site, either in-office or out-of-office,
increased from its 1997 practice expense RVUs.)
(5) For services furnished in 2002 and subsequent years, the
practice expense RVUs are based entirely on relative practice expense
resources.
(i) Usually there are two levels of practice expense RVUs that
correspond to each code.
(A) Facility practice expense RVUs. The facility practice expense
RVUs apply to services furnished to patients in a hospital, a skilled
nursing facility, a community mental health center, a hospice, or an
ambulatory surgical center, or in a wholly owned or wholly operated
entity providing preadmission services under Sec. 412.2(c)(5) of this
chapter, or via telehealth under Sec. 410.78 of this chapter.
(B) Nonfacility practice expense RVUs. The nonfacility practice
expense RVUs apply to services furnished to patients in all locations
other than those listed in paragraph (b)(5)(i)(A) of this section, but
not limited to, a physician's office, the patient's home, a nursing
facility, or a comprehensive outpatient rehabilitation facility (CORF).
(C) Outpatient therapy and CORF services. Outpatient therapy
services (including physical therapy, occupational therapy, and speech-
language pathology services) and CORF services billed under the
physician fee schedule are paid using the nonfacility practice expense
RVUs.
(ii) [Reserved]
(6)(i) CMS establishes criteria for supplemental surveys regarding
specialty practice expenses submitted to CMS that may be used in
determining practice expense RVUs.
(ii) Any CMS-designated specialty group may submit a supplemental
survey.
(iii) CMS will consider for use in determining practice expense RVUs
for the physician fee schedule survey data and related materials
submitted to CMS by March 1, 2004 to determine CY 2005 practice expense
RVUs and by March 1, 2005 to determine CY 2006 practice expense RVUs.
(c) Malpractice insurance RVUs. (1) Malpractice insurance RVUs are
computed for each service or class of services by applying average
malpractice insurance historical practice cost percentages to the
estimated average allowed charge during the 1991 base period.
(2) The average historical malpractice insurance percentage for a
service or class of services is computed as follows:
(i) Multiply the average malpractice insurance percentage for each
specialty by the proportion of a particular service or class of services
performed by that specialty.
(ii) Add all the products for all the specialties.
[[Page 11]]
(3) For services furnished in the year 2000 and subsequent years,
the malpractice RVUs are based on the relative malpractice insurance
resources.
[56 FR 59624, Nov. 25, 1991, as amended at 57 FR 42493, Sept. 15, 1992;
58 FR 63687, Dec. 2, 1993; 62 FR 59102, Oct. 31, 1997; 63 FR 58910, Nov.
2, 1998; 64 FR 59441, Nov. 2, 1999; 65 FR 25668, May 3, 2000; 65 FR
65440, Nov. 1, 2000; 67 FR 43558, June 28, 2002; 68 FR 63261, Nov. 7,
2003; 72 FR 66932, Nov. 27, 2007; 73 FR 69935, Nov. 19, 2008; 76 FR
73471, Nov. 28, 2011; 81 FR 79879, Nov. 14, 2016; 81 FR 80553, Nov. 15,
2016]
Sec. 414.24 Publication of RVUs and direct PE inputs.
(a) Definitions. For purposes of this section, the following
definitions apply:
Existing code means a code that is not a new code under paragraph
(c)(2) of this section, and includes codes for which the descriptor is
revised and codes that are combinations or subdivisions of previously
existing codes.
New code means a code that describes a service that was not
previously described or valued under the PFS using any other code or
combination of codes.
(b) Revisions of RVUs and Direct PE Inputs. For valuations for
calendar year 2017 and beyond, CMS publishes, through notice and comment
rulemaking in the Federal Register (including proposals in a proposed
rule), changes in RVUs or direct PE inputs for existing codes.
(c) Establishing RVUs and Direct PE inputs for new codes--(1)
General rule. CMS establishes RVUs and direct PE inputs for new codes in
the manner described in paragraph (b) of this section.
(2) Exception for new codes for which CMS does not have sufficient
information. When CMS determines for a new code that it does not have
sufficient information to include proposed RVUs or direct PE inputs in
the proposed rule, but that it is in the public interest for Medicare to
use a new code during a payment year, CMS will publish in the Federal
Register RVUs and direct PE inputs that are applicable on an interim
basis subject to public comment. After considering public comments and
other information on interim RVUs and PE inputs for the new code, CMS
publishes in the Federal Register the final RVUs and PE inputs for the
code.
(d) Values for local codes (HCPCS Level 3). (1) Carriers establish
relative values for local codes for services not included in HCPCS
levels 1 or 2.
(2) Carriers must obtain prior approval from CMS to establish local
codes for services that meet the definition of ``physician services'' in
Sec. 414.2.
[56 FR 59624, Nov. 25, 1991, as amended at 57 FR 42492, Sept. 15, 1992;
79 FR 68003, Nov. 13, 2014]
Sec. 414.26 Determining the GAF.
CMS establishes a GAF for each service in each fee schedule area.
(a) Geographic indices. CMS uses the following indices to establish
the GAF:
(1) An index that reflects one-fourth of the difference between the
relative value of physicians' work effort in each of the different fee
schedule areas as determined under Sec. 414.22(a) and the national
average of that work effort.
(2) An index that reflects the relative costs of the mix of goods
and services comprising practice expenses (other than malpractice
expenses) in each of the different fee schedule areas as determined
under Sec. 414.22(b) compared to the national average of those costs.
(3) An index that reflects the relative costs of malpractice
expenses in each of the different fee schedule areas as determined under
Sec. 414.22(c) compared to the national average of those costs.
(b) Class-specific practice cost indices. If the application of a
single index to different classes of services would be substantially
inequitable because of differences in the mix of goods and services
comprising practice expenses for the different classes of services, more
than one index may be established under paragraph (a)(2) of this
section.
(c) Adjusting the practice expense index to account for the Frontier
State floor--(1) General criteria. Effective on or after January 1,
2011, CMS will adjust the practice expense index for physicians'
services furnished in qualifying States to recognize the practice
expense index floor established for Frontier States. A qualifying State
must meet the following criteria:
(i) At least 50 percent of counties located within the State have a
population density less than 6 persons per square mile.
[[Page 12]]
(ii) The State does not receive a non-labor related share adjustment
determined by the Secretary to take into account the unique
circumstances of hospitals located in Alaska and Hawaii.
(2) Amount of adjustment. The practice expense value applied for
physicians' services furnished in a qualifying State will be not less
than 1.00.
(3) Process for determining adjustment. (i) CMS will use the most
recent population estimate data published by the U.S. Census Bureau to
determine county definitions and population density. This analysis will
be periodically revised, such as for updates to the decennial census
data.
(ii) CMS will publish annually a listing of qualifying Frontier
States receiving a practice expense index floor attributable to this
provision.
(d) Computation of GAF. The GAF for each fee schedule area is the
sum of the physicians' work adjustment factor, the practice expense
adjustment factor, and the malpractice cost adjustment factor, as
defined in this section:
(1) The geographic physicians' work adjustment factor for a service
is the product of the proportion of the total relative value for the
service that reflects the RVUs for the work component and the geographic
physicians' work index value established under paragraph (a)(1) of this
section.
(2) The geographic practice expense adjustment factor for a service
is the product of the proportion of the total relative value for the
service that reflects the RVUs for the practice expense component,
multiplied by the geographic practice cost index (GPCI) value
established under paragraph (a)(2) of this section.
(3) The geographic malpractice adjustment factor for a service is
the product of the proportion of the total relative value for the
service that reflects the RVUs for the malpractice component, multiplied
by the GPCI value established under paragraph (a)(3) of this section.
[56 FR 59624, Nov. 25, 1991, as amended at 57 FR 42492, Sept. 15, 1992;
75 FR 73616, Nov. 29, 2010]
Sec. 414.28 Conversion factors.
CMS establishes CFs in accordance with section 1848(d) of the Act.
(a) Base-year CFs. CMS established the CF for 1992 so that had
section 1848 of the Act applied during 1991, it would have resulted in
the same aggregate amount of payments for physician services as the
estimated aggregate amount of these payments in 1991, adjusted by the
update for 1992 computed as specified in Sec. 414.30.
(b) Subsequent CFs. For calendar years 1993 through 1995, the CF for
each year is equal to the CF for the previous year, adjusted in
accordance with Sec. 414.30. Beginning January 1, 1996, the CF for each
calendar year may be further adjusted so that adjustments to the fee
schedule in accordance with section 1848(c)(2)(B)(ii) of the Act do not
cause total expenditures under the fee schedule to differ by more than
$20 million from the amount that would have been spent if these
adjustments had not been made.
[56 FR 59624, Nov. 25, 1991, as amended at 57 FR 42492, Sept. 15, 1992;
60 FR 53877, Oct. 18, 1995; 60 FR 63177, Dec. 8, 1995]
Sec. 414.30 Conversion factor update.
Unless Congress acts in accordance with section 1848(d)(3) of the
Act--
(a) General rule. The CF update for a CY equals the Medicare
Economic Index increased or decreased by the number of percentage points
by which the percentage increase in expenditures for physician services
(or for a particular category of physician services, such as surgical
services) in the second preceding FY over the third preceding FY exceeds
the performance standard rate of increase established for the second
preceding FY.
(b) Downward adjustment. The downward adjustment may not exceed the
following:
(1) For CYs 1992 and 1993, 2 percentage points.
(2) For CY 1994, 2.5 percentage points.
(3) For CYs 1995 and thereafter, 5 percentage points.
[55 FR 23441, June 8, 1990, as amended at 60 FR 63177, Dec. 8, 1995; 61
FR 42385, Aug. 15, 1996]
[[Page 13]]
Sec. 414.34 Payment for services and supplies incident
to a physician's service.
(a) Medical supplies. (1) Except as otherwise specified in this
paragraph, office medical supplies are considered to be part of a
physician's practice expense, and payment for them is included in the
practice expense portion of the payment to the physician for the medical
or surgical service to which they are incidental.
(2) If physician services of the type routinely furnished in
provider settings are furnished in a physician's office, separate
payment may be made for certain supplies furnished incident to that
physician service if the following requirements are met:
(i) It is a procedure that can safely be furnished in the office
setting in appropriate circumstances.
(ii) It requires specialized supplies that are not routinely
available in physicians' offices and that are generally disposable.
(iii) It is furnished before January 1, 1999.
(3) For the purpose of paragraph (a)(2) of this section, provider
settings include only the following settings:
(i) Hospital inpatient and outpatient departments.
(ii) Ambulatory surgical centers.
(4) For the purpose of paragraph (a)(2) of this section, ``routinely
furnished in provider settings'' means furnished in inpatient or
outpatient hospital settings or ambulatory surgical centers more than 50
percent of the time.
(5) CMS establishes a list of services for which a separate supply
payment may be made under this section.
(6) The fee schedule amount for supplies billed separately is not
subject to a GPCI adjustment.
(b) Services of nonphysicians that are incident to a physician's
service. Services of nonphysicians that are covered as incident to a
physician's service are paid as if the physician had personally
furnished the service.
[56 FR 59624, Nov. 25, 1991; 57 FR 42492, Sept. 15, 1992, as amended at
63 FR 58911, Nov. 2, 1998]
Sec. 414.36 Payment for drugs incident to a physician's service.
Payment for drugs incident to a physician's service is made in
accordance with Sec. 405.517 of this chapter.
Sec. 414.39 Special rules for payment of care plan oversight.
(a) General. Except as specified in paragraphs (b) and (c) of this
section, payment for care plan oversight is included in the payment for
visits and other services under the physician fee schedule. For purposes
of this section a nonphysician practitioner (NPP) is a nurse
practitioner, clinical nurse specialist or physician assistant.
(b) Exception. Separate payment is made under the following
conditions for physician care plan oversight services furnished to
beneficiaries who receive HHA and hospice services that are covered by
Medicare:
(1) The care plan oversight services require recurrent physician
supervision of therapy involving 30 or more minutes of the physician's
time per month.
(2) Payment is made to only one physician per patient for services
furnished during a calendar month period. The physician must have
furnished a service requiring a face-to-face encounter with the patient
at least once during the 6-month period before the month for which care
plan oversight payment is first billed. The physician may not have a
significant ownership interest in, or financial or contractual
relationship with, the HHA in accordance with Sec. 424.22(d) of this
chapter. The physician may not be the medical director or employee of
the hospice and may not furnish services under an arrangement with the
hospice.
(3) If a physician furnishes care plan oversight services during a
postoperative period, payment for care plan oversight services is made
if the services are documented in the patient's medical record as
unrelated to the surgery.
(c) Special rules for payment of care plan oversight provided by
nonphysician practitioners for beneficiaries who receive HHA services
covered by Medicare. (1) An NPP can furnish physician care plan
oversight (but may not certify a patient as needing home health
services) only if the physician who signs the
[[Page 14]]
plan of care provides regular ongoing care under the same plan of care
as does the NPP billing for care plan oversight and either--
(i) The physician and NPP are part of the same group practice; or
(ii) If the NPP is a nurse practitioner or clinical nurse
specialist, the physician signing the plan of care also has a
collaborative agreement with the NPP; or
(iii) If the NPP is a physician assistant, the physician signing the
plan of care is also the physician who provides general supervision of
physician assistant services for the practice.
(2) Payment may be made for care plan oversight services furnished
by an NPP when:
(i) The NPP providing the care plan oversight has seen and examined
the patient;
(ii) The NPP providing care plan oversight is not functioning as a
consultant whose participation is limited to a single medical condition
rather than multi-disciplinary coordination of care; and
(iii) The NPP providing care plan oversight integrates his or her
care with that of the physician who signed the plan of care.
[59 FR 63463, Dec. 8, 1994; 60 FR 49, Jan. 3, 1995; 60 FR 36733, July
18, 1995, as amended at 69 FR 66423, Nov. 15, 2004; 70 FR 16722, Apr. 1,
2005]
Sec. 414.40 Coding and ancillary policies.
(a) General rule. CMS establishes uniform national definitions of
services, codes to represent services, and payment modifiers to the
codes.
(b) Specific types of policies. CMS establishes uniform national
ancillary policies necessary to implement the fee schedule for physician
services. These include, but are not limited to, the following policies:
(1) Global surgery policy (for example, post- and pre-operative
periods and services, and intra-operative services).
(2) Professional and technical components (for example, payment for
services, such as an EEG, which typically comprise a technical component
(the taking of the test) and a professional component (the
interpretation)).
(3) Payment modifiers (for example, assistant-at-surgery, multiple
surgery, bilateral surgery, split surgical global services, team
surgery, and unusual services).
Sec. 414.42 Adjustment for first 4 years of practice.
(a) General rule. For services furnished during CYs 1992 and 1993,
except as specified in paragraph (b) of this section, the fee schedule
payment amount or prevailing charge must be phased in as specified in
paragraph (d) of this section for physicians, physical therapists (PTs),
occupational therapists (OTs), and all other health care practitioners
who are in their first through fourth years of practice.
(b) Exception. The reduction required in paragraph (d) of this
section does not apply to primary care services or to services furnished
in a rural area as defined in section 1886(d)(2)(D) of the Act that is
designated under section 332(a)(1)(A) of the Public Health Service Act
as a Health Professional Shortage Area.
(c) Definition of years of practice. (1) The ``first year of
practice`` is the first full CY during the first 6 months of which the
physician, PT, OT, or other health care practitioner furnishes
professional services for which payment may be made under Medicare Part
B, plus any portion of the prior CY if that prior year does not meet the
first 6 months test.
(2) The ``second, third, and fourth years of practice`` are the
first, second, and third CYs following the first year of practice,
respectively.
(d) Amounts of adjustment. The fee schedule payment for the service
of a new physician, PT, OT, or other health care practitioner is limited
to the following percentages for each of the indicated years:
(1) First year--80 percent
(2) Second year--85 percent
(3) Third year--90 percent
(4) Fourth year--95 percent
[57 FR 42493, Sept. 15, 1992, as amended at 58 FR 63687, Dec. 2, 1993]
Sec. 414.44 Transition rules.
(a) Adjusted historical payment basis--(1) All services other than
radiology and nuclear medicine services. For all physician services
other than radiology services, furnished in a fee schedule area,
[[Page 15]]
the adjusted historical payment basis (AHPB) is the estimated weighted
average prevailing charge applied in the fee schedule area for the
service in CY 1991, as determined by CMS without regard to physician
specialty and as adjusted to reflect payments for services below the
prevailing charge, adjusted by the update established for CY 1992.
(2) Radiology services. For radiology services, the AHPB is the
amount paid for the service in the fee schedule area in CY 1991 under
the fee schedule established under section 1834(b), adjusted by the
update established for CY 1992.
(3) Nuclear medicine services. For nuclear medicine services, the
AHPB is the amount paid for the service in the fee schedule area in CY
1991 under the fee schedule established under section 6105(b) of Public
Law 101-239 and section 4102(g) of Public Law 101-508, adjusted by the
update established for CY 1992.
(4) Transition adjustment. CMS adjusts the AHPB for all services by
5.5 percent to produce budget-neutral payments for 1992.
(b) Adjustment of 1992 payments for physician services other than
radiology services. For physician services furnished during CY 1992 the
following rules apply:
(1) If the AHPB determined under paragraph (a) of this section is
from 85 percent to 115 percent of the fee schedule amount for the area
for services furnished in 1992, payment is at the fee schedule amount.
(2) If the AHPB determined under paragraph (a) of this section is
less than 85 percent of the fee schedule amount for the area for
services furnished in 1992, an amount equal to the AHPB plus 15 percent
of the fee schedule amount is substituted for the fee schedule amount.
(3) If the AHPB determined under paragraph (a) of this section is
greater than 115 percent of the fee schedule amount for the area for
services furnished in 1992, an amount equal to the AHPB minus 15 percent
of the fee schedule amount is substituted for the fee schedule amount.
(c) Adjustment of 1992 payments for radiology services. For
radiology services furnished during CY 1992 the following rules apply:
(1) If the AHPB determined under paragraph (a) of this section is
from 85 percent to 109 percent of the fee schedule amount for the area
for services furnished in 1992, payment is at the fee schedule amount.
(2) If the AHPB determined under paragraph (a) of this section is
less than 85 percent of the fee schedule amount for the area for
services furnished in 1992, an amount equal to the AHPB plus 15 percent
of the fee schedule amount is substituted for the fee schedule amount.
(3) If the AHPB determined under paragraph (a) of this section is
greater than 109 percent of the fee schedule amount for the area for
services furnished in 1992, an amount equal to the AHPB minus 9 percent
of the fee schedule amount is substituted for the fee schedule amount.
(d) Computation of payments for CY 1993. For physician services
subject to the transition rules in CY 1992 and furnished during CY 1993,
the fee schedule is equal to 75 percent of the amount that would have
been paid in the fee schedule area under the 1992 transition rules,
adjusted by the amount of the 1993 update, plus 25 percent of the 1993
fee schedule amount.
(e) Computation of payments for CY 1994. For physician services
subject to the transition rules in CY 1993, and furnished during CY
1994, the fee schedule is equal to 67 percent of the amount that would
have been paid in the fee schedule area under the 1993 transition rules,
adjusted by the amount of the 1994 update, plus 33 percent of the 1994
fee schedule amount.
(f) Computation of payments for CY 1995. For physician services
subject to the transition rules in CY 1994 and furnished during CY 1995,
the fee schedule is equal to 50 percent of the amount that would have
been paid in the fee schedule area under the 1994 transition rules,
adjusted by the amount of the 1995 update, plus 50 percent of the 1995
fee schedule amount.
Sec. 414.46 Additional rules for payment of anesthesia services.
(a) Definitions. For purposes of this section, the following
definitions apply:
[[Page 16]]
(1) Base unit means the value for each anesthesia code that reflects
all activities other than anesthesia time. These activities include
usual preoperative and postoperative visits, the administration of
fluids and blood incident to anesthesia care, and monitoring services.
(2) Anesthesia practitioner, for the purpose of anesthesia time,
means a physician who performs the anesthesia service alone, a CRNA who
is not medically directed who performs the anesthesia service alone, or
a medically directed CRNA.
(3) Anesthesia time means the time during which an anesthesia
practitioner is present with the patient. It starts when the anesthesia
practitioner begins to prepare the patient for anesthesia services and
ends when the anesthesia practitioner is no longer furnishing anesthesia
services to the beneficiary, that is, when the beneficiary may be placed
safely under postoperative care. Anesthesia time is a continuous time
period from the start of anesthesia to the end of an anesthesia service.
In counting anesthesia time, the anesthesia practitioner can add blocks
of anesthesia time around an interruption in anesthesia time as long as
the anesthesia practitioner is furnishing continuous anesthesia care
within the time periods around the interruption.
(b) Determinations of payment amount--Basic rule. For anesthesia
services performed, medically directed, or medically supervised by a
physician, CMS pays the lesser of the actual charge or the anesthesia
fee schedule amount.
(1) The carrier bases the fee schedule amount for an anesthesia
service on the product of the sum of allowable base and time units and
an anesthesia-specific CF. The carrier calculates the time units from
the anesthesia time reported by the anesthesia practitioner for the
anesthesia procedure. The physician who fulfills the conditions for
medical direction in Sec. 415.110 (Conditions for payment:
Anesthesiology services) reports the same anesthesia time as the
medically-directed CRNA.
(2) CMS furnishes the carrier with the base units for each
anesthesia procedure code. The base units are derived from the 1988
American Society of Anesthesiologists' Relative Value Guide except that
the number of base units recognized for anesthesia services furnished
during cataract or iridectomy surgery is four units.
(3) Modifier units are not allowed. Modifier units include
additional units charged by a physician or a CRNA for patient health
status, risk, age, or unusual circumstances.
(c) Physician personally performs the anesthesia procedure. (1) CMS
considers an anesthesia service to be personally performed under any of
the following circumstances:
(i) The physician performs the entire anesthesia service alone.
(ii) The physician establishes an attending physician relationship
in one or two concurrent cases involving an intern or resident and the
service was furnished before January 1, 1994.
(iii) The physician establishes an attending physician relationship
in one case involving an intern or resident and the service was
furnished on or after January 1, 1994 but prior to January 1, 1996. For
services on or after January 1, 1996, the physician must be the teaching
physician as defined in Sec. Sec. 415.170 through 415.184 of this
chapter.
(iv) The physician and the CRNA or AA are involved in a single case
and the services of each are found to be medically necessary.
(v) The physician is continuously involved in a single case
involving a student nurse anesthetist.
(vi) The physician is continuously involved in a single case
involving a CRNA or AA and the service was furnished prior to January 1,
1998.
(2) CMS determines the fee schedule amount for an anesthesia service
personally performed by a physician on the basis of an anesthesia-
specific fee schedule CF and unreduced base units and anesthesia time
units. One anesthesia time unit is equivalent to 15 minutes of
anesthesia time, and fractions of a 15-minute period are recognized as
fractions of an anesthesia time unit.
(d) Anesthesia services medically directed by a physician. (1) CMS
considers an anesthesia service to be medically directed by a physician
if:
[[Page 17]]
(i) The physician performs the activities described in Sec. 415.110
of this chapter.
(ii) The physician directs qualified individuals involved in two,
three, or four concurrent cases.
(iii) Medical direction can occur for a single case furnished on or
after January 1, 1998 if the physician performs the activities described
in Sec. 415.110 of this chapter and medically directs a single CRNA or
AA.
(2) The rules for medical direction differ for certain time periods
depending on the nature of the qualified individual who is directed by
the physician.
(i) If more than two procedures are directed on or after January 1,
1994, the qualified individuals could be AAs, CRNAs, interns, or
residents. The medical direction rules apply to student nurse
anesthetists only if the physician directs two concurrent cases, each of
which involves a student nurse anesthetist or the physician directs one
case involving a student nurse anesthetist and the other involving a
CRNA, AA, intern, or resident.
(ii) For services furnished on or after January 1, 2010, the medical
direction rules do not apply to a single anesthesia resident case that
is concurrent to another case which is paid under the medical direction
payment rules as specified in paragraph (e) of this section.
(3) Payment for medical direction is based on a specific percentage
of the payment allowance recognized for the anesthesia service
personally performed by a physician alone. The following percentages
apply for the years specified:
(i) CY 1994--60 percent of the payment allowance for personally
performed procedures.
(ii) CY 1995--57.5 percent of the payment allowance for personally
performed services.
(iii) CY 1996--55 percent of the payment allowance for personally
performed services.
(iv) CY 1997--52.5 percent of the payment allowance for personally
performed services.
(v) CY 1998 and thereafter--50 percent of the payment allowance for
personally performed services.
(e) Special payment rule for teaching anesthesiologist involved in a
single resident case or two concurrent cases. For physicians' services
furnished on or after January 1, 2010, if the teaching anesthesiologist
is involved in the training of physician residents in a single
anesthesia case or two concurrent anesthesia cases, the fee schedule
amount must be 100 percent of the fee schedule amount otherwise
applicable if the anesthesia services were personally performed by the
teaching anesthesiologist and the teaching anesthesiologist fulfilled
the criteria in Sec. 415.178 of this chapter. This special payment rule
also applies if the teaching anesthesiologist is involved in one
resident case that is concurrent to another case paid under the medical
direction payment rules.
(f) Physician medically supervises anesthesia services. If the
physician medically supervises more than four concurrent anesthesia
services, CMS bases the fee schedule amount on an anesthesia-specific CF
and three base units. This represents payment for the physician's
involvement in the pre-surgical anesthesia services.
(g) Payment for medical or surgical services furnished by a
physician while furnishing anesthesia services. (1) CMS allows separate
payment under the fee schedule for certain reasonable and medically
necessary medical or surgical services furnished by a physician while
furnishing anesthesia services to the patient. CMS makes payment for
these services in accordance with the general physician fee schedule
rules in Sec. 414.20. These services are described in program operating
instructions.
(2) CMS makes no separate payment for other medical or surgical
services, such as the pre-anesthetic examination of the patient, pre- or
post-operative visits, or usual monitoring functions, that are
ordinarily included in the anesthesia service.
(h) Physician involved in multiple anesthesia services. If the
physician is involved in multiple anesthesia services for the same
patient during the same operative session, the carrier makes payment
according to the base unit associated with the anesthesia service having
the highest base unit value and anesthesia time that encompasses the
[[Page 18]]
multiple services. The carrier makes payment for add-on anesthesia codes
according to program operating instructions.
[56 FR 59624, Nov. 25, 1991, as amended at 57 FR 42492, Sept. 15, 1992;
58 FR 63687, Dec. 2, 1993; 60 FR 63177, Dec. 8, 1995; 64 FR 59441, Nov.
2, 1999; 67 FR 80041, Dec. 31, 2002; 68 FR 63261, Nov. 7, 2003; 74 FR
62006, Nov. 25, 2009]
Sec. 414.48 Limits on actual charges of nonparticipating suppliers.
(a) General rule. A supplier, as defined in Sec. 400.202 of this
chapter, who is nonparticipating and does not accept assignment may
charge a beneficiary an amount up to the limiting charge described in
paragraph (b) of this section.
(b) Specific limits. For items or services paid under the physician
fee schedule, the limiting charge is 115 percent of the fee schedule
amount for nonparticipating suppliers. For items or services CMS
excludes from payment under the physician fee schedule (in accordance
with section 1848 (j)(3) of the Act), the limiting charge is 115 percent
of 95 percent of the payment basis applicable to participating suppliers
as calculated in Sec. 414.20(b).
[58 FR 63687, Dec. 2, 1993, as amended at 62 FR 59102, Oct. 31, 1997]
Sec. 414.50 Physician or other supplier billing for diagnostic tests
performed or interpreted by a physician who does not share a practice
with the billing physician or other supplier.
(a) General rules. (1) For services covered under section 1861(s)(3)
of the Act and paid for under part 414 of this chapter (other than
clinical diagnostic laboratory tests paid under section 1833(a)(2)(D) of
the Act, which are subject to the special billing rules set forth in
section 1833(h)(5)(A) of the Act), if a physician or other supplier
bills for the technical component (TC) or professional component (PC) of
a diagnostic test that was ordered by the physician or other supplier
(or ordered by a party related to such physician or other supplier
through common ownership or control as described in Sec. 413.17 of this
chapter) and the diagnostic test is performed by a physician who does
not share a practice with the billing physician or other supplier, the
payment to the billing physician or other supplier (less the applicable
deductibles and coinsurance paid by the beneficiary or on behalf of the
beneficiary) for the TC or PC of the diagnostic test may not exceed the
lowest of the following amounts:
(i) The performing supplier's net charge to the billing physician or
other supplier. For purposes of this paragraph (a)(1) only, with respect
to the TC, the performing supplier is the physician who supervised the
TC, and with respect to the PC, the performing supplier is the physician
who performed the PC.
(ii) The billing physician or other supplier's actual charge.
(iii) The fee schedule amount for the test that would be allowed if
the performing supplier billed directly.
(2) The following requirements are applicable for purposes of
paragraph (a)(1) of this section:
(i) The net charge must be determined without regard to any charge
that is intended to reflect the cost of equipment or space leased to the
performing supplier by or through the billing physician or other
supplier.
(ii) A performing physician shares a practice with the billing
physician or other supplier if he or she furnishes substantially all
(which, for purposes of this section, means ``at least 75 percent'') of
his or her professional services through such billing physician or other
supplier. The ``substantially all'' requirement will be satisfied if, at
the time the billing physician or other supplier submits a claim for a
service furnished by the performing physician, the billing physician or
other supplier has a reasonable belief that:
(A) For the 12 months prior to and including the month in which the
service was performed, the performing physician furnished substantially
all of his or her professional services through the billing physician or
other supplier; or
(B) The performing physician will furnish substantially all of his
or her professional services through the billing physician or other
supplier for the next 12 months (including the month in which the
service is performed).
[[Page 19]]
(iii) A physician will be deemed to share a practice with the
billing physician or other supplier with respect to the performance of
the TC or PC of a diagnostic test if the physician is an owner, employee
or independent contractor of the billing physician or other supplier and
the TC or PC is performed in the office of the billing physician or
other supplier. The ``office of the billing physician or other
supplier'' is any medical office space, regardless of number of
locations, in which the ordering physician or other ordering supplier
regularly furnishes patient care, and includes space where the billing
physician or other supplier furnishes diagnostic testing, if the space
is located in the same building (as defined in Sec. 411.351) in which
the ordering physician or other ordering supplier regularly furnishes
patient care. With respect to a billing physician or other supplier that
is a physician organization (as defined in Sec. 411.351 of this
chapter), the ``office of the billing physician or other supplier'' is
space in which the ordering physician provides substantially the full
range of patient care services that the ordering physician provides
generally. The performance of the TC includes both the conducting of the
TC as well as the supervision of the TC.
(b) Restriction on payment. (1) The billing physician or other
supplier must identify the performing supplier and indicate the
performing supplier's net charge for the test. If the billing physician
or other supplier fails to provide this information, CMS makes no
payment to the billing physician or other supplier and the billing
physician or other supplier may not bill the beneficiary.
(2) Physicians and other suppliers that accept Medicare assignment
may bill beneficiaries for only the applicable deductibles and
coinsurance.
(3) Physicians and other suppliers that do not accept Medicare
assignment may not bill the beneficiary more than the payment amount
described in paragraph (a) of this section.
[72 FR 66400, Nov. 27, 2007, as amended at 73 FR 2432, Jan. 15, 2008; 73
FR 69935, Nov. 19, 2008]
Sec. 414.52 Payment for physician assistants' services.
Allowed amounts for the services of a physician assistant furnished
beginning January 1, 1992 and ending December 31, 1997, may not exceed
the limits specified in paragraphs (a) through (c) of this section.
Allowed amounts for the services of a physician assistant furnished
beginning January 1, 1998, may not exceed the limits specified in
paragraph (d) of this section.
(a) For assistant-at-surgery services, 65 percent of the amount that
would be allowed under the physician fee schedule if the assistant-at-
surgery service was furnished by a physician.
(b) For services (other than assistant-at-surgery services)
furnished in a hospital, 75 percent of the physician fee schedule amount
for the service.
(c) For all other services, 85 percent of the physician fee schedule
amount for the service.
(d) For services (other than assistant-at-surgery services)
furnished beginning January 1, 1998, 85 percent of the physician fee
schedule amount for the service. For assistant-at-surgery services, 85
percent of the physician fee schedule amount that would be allowed under
the physician fee schedule if the assistant-at-surgery service were
furnished by a physician.
[56 FR 59624, Nov. 25, 1991; 57 FR 42492, Sept. 15, 1992, as amended at
63 FR 58911, Nov. 2, 1998]
Sec. 414.54 Payment for certified nurse-midwives' services.
(a) For services furnished after December 31, 1991, allowed amounts
under the fee schedule established under section 1833(a)(1)(K) of the
Act for the payment of certified nurse-midwife services may not exceed
65 percent of the physician fee schedule amount for the service.
(b) For certified nurse-midwife services furnished on or after
January 1, 2011, allowed amounts may not exceed 100 percent of the
physician fee schedule amount that would be paid to a physician for the
services.
[75 FR 73616, Nov. 29, 2010]
[[Page 20]]
Sec. 414.56 Payment for nurse practitioners' and clinical
nurse specialists' services.
(a) Rural areas. For services furnished beginning January 1, 1992
and ending December 31, 1997, allowed amounts for the services of a
nurse practitioner or a clinical nurse specialist in a rural area (as
described in section 1861(s)(2)(K)(iii) of the Act) may not exceed the
following limits:
(1) For services furnished in a hospital (including assistant-at-
surgery services), 75 percent of the physician fee schedule amount for
the service.
(2) For all other services, 85 percent of the physician fee schedule
amount for the service.
(b) Non-rural areas. For services furnished beginning January 1,
1992 and ending December 31, 1997, allowed amounts for the services of a
nurse practitioner or a clinical nurse specialist in a nursing facility
may not exceed 85 percent of the physician fee schedule amount for the
service.
(c) Beginning January 1, 1998. For services (other than assistant-
at-surgery services) furnished beginning January 1, 1998, allowed
amounts for the services of a nurse practitioner or clinical nurse
specialist may not exceed 85 percent of the physician fee schedule
amount for the service. For assistant-at-surgery services, allowed
amounts for the services of a nurse practitioner or clinical nurse
specialist may not exceed 85 percent of the physician fee schedule
amount that would be allowed under the physician fee schedule if the
assistant-at-surgery service were furnished by a physician.
[63 FR 58911, Nov. 2, 1998]
Sec. 414.58 Payment of charges for physician services
to patients in providers.
(a) Payment under the physician fee schedule. In addition to the
special conditions for payment in Sec. Sec. 415.100 through 415.130,
and Sec. 415.190 of this chapter, CMS establishes payment for physician
services to patients in providers under the physician fee schedule in
accordance with Sec. Sec. 414.1 through 414.48.
(b) Teaching hospitals. Services furnished by physicians in teaching
hospitals may be made on a reasonable cost basis set forth in Sec.
415.162 of this chapter if the hospital exercises the election described
in Sec. 415.160 of this chapter.
[56 FR 59624, Nov. 25, 1991, as amended at 57 FR 42492, Sept. 15, 1992;
60 FR 63189, Dec. 8, 1995]
Sec. 414.60 Payment for the services of CRNAs.
(a) Basis for payment. The allowance for the anesthesia service
furnished by a CRNA, medically directed or not medically directed, is
based on allowable base and time units as defined in Sec. 414.46(a).
Beginning with CY 1994--
(1) The allowance for an anesthesia service furnished by a medically
directed CRNA is based on a fixed percentage of the allowance recognized
for the anesthesia service personally performed by the physician alone,
as specified in Sec. 414.46(d)(3); and
(2) The CF for an anesthesia service furnished by a CRNA not
directed by a physician may not exceed the CF for a service personally
performed by a physician.
(b) To whom payment may be made. Payment for an anesthesia service
furnished by a CRNA may be made to the CRNA or to any individual or
entity (such as a hospital, critical access hospital, physician, group
practice, or ambulatory surgical center) with which the CRNA has an
employment or contract relationship that provides for payment to be made
to the individual or entity.
(c) Condition for payment. Payment for the services of a CRNA may be
made only on an assignment related basis, and any assignment accepted by
a CRNA is binding on any other person presenting a claim or request for
payment for the service.
[60 FR 63178, Dec. 8, 1995, as amended at 62 FR 46037, Aug. 29, 1997; 64
FR 59441, Nov. 2, 1999; 77 FR 69363, Nov. 16, 2012]
Sec. 414.61 Payment for anesthesia services furnished by a teaching CRNA.
(a) Basis for payment. Beginning January 1, 2010, anesthesia
services furnished by a teaching CRNA may be paid under one of the
following conditions:
(1) The teaching CRNA, who is not under medical direction of a
physician,
[[Page 21]]
is present with the student nurse anesthetist for the pre and post
anesthesia services included in the anesthesia base units payment and is
continuously present during anesthesia time in a single case with a
student nurse anesthetist.
(2) The teaching CRNA, who is not under the medical direction of a
physician, is involved with two concurrent anesthesia cases with student
nurse anesthetists. The teaching CRNA must be present with the student
nurse anesthetist for the pre and post anesthesia services included in
the anesthesia base unit. For the anesthesia time of the two concurrent
cases, the teaching CRNA can only be involved with those two concurrent
cases and may not perform services for other patients.
(b) Level of payment. The allowance for the service of the teaching
CRNA, furnished under paragraph (a) of this section, is determined in
the same way as for a physician who personally performs the anesthesia
service alone as specified in Sec. 414.46(c) of this subpart.
[74 FR 62006, Nov. 25, 2009]
Sec. 414.62 Fee schedule for clinical psychologist services.
The fee schedule for clinical psychologist services is set at 100
percent of the amount determined for corresponding services under the
physician fee schedule.
[62 FR 59102, Oct. 31, 1997]
Sec. 414.63 Payment for outpatient diabetes self-management training.
(a) Payment under the physician fee schedule. Except as provided in
paragraph (d) of this section, payment for outpatient diabetes self-
management training is made under the physician fee schedule in
accordance with Sec. Sec. 414.1 through 414.48.
(b) To whom payment may be made. Payment may be made to an entity
approved by CMS to furnish outpatient diabetes self-management training
in accordance with part 410, subpart H of this chapter.
(c) Limitation on payment. Payment may be made for training sessions
actually attended by the beneficiary and documented on attendance
sheets.
(d) Payments made to those not paid under the physician fee
schedule. Payments may be made to other entities not routinely paid
under the physician fee schedule, such as hospital outpatient
departments, ESRD facilities, and DME suppliers. The payment equals the
amounts paid under the physician fee schedule.
(e) Other conditions for fee-for-service payment. The beneficiary
must meet the following conditions:
(1) Has not previously received initial training for which Medicare
payment was made under this benefit.
(2) Is not receiving services as an inpatient in a hospital, SNF,
hospice, or nursing home.
(3) Is not receiving services as an outpatient in an RHC or FQHC.
[65 FR 83153, Dec. 29, 2000]
Sec. 414.64 Payment for medical nutrition therapy.
(a) Payment under the physician fee schedule. Medicare payment for
medical nutrition therapy is made under the physician fee schedule in
accordance with subpart B of this part. Payment to non-physician
professionals, as specified in paragraph (b) of this section, is the
lesser of the actual charges or 80 percent of 85 percent of the
physician fee schedule amount.
(b) To whom payment may be made. Payment may be made to a registered
dietician or nutrition professional qualified to furnish medical
nutrition therapy in accordance with part 410, subpart G of this
chapter.
(c) Effective date of payment. Medicare pays suppliers of medical
nutrition therapy on or after the effective date of enrollment of the
supplier at the carrier.
(d) Limitation on payment. Payment is made only for documented
nutritional therapy sessions actually attended by the beneficiary.
(e) Other conditions for fee-for-service payment. Payment is made
only if the beneficiary:
(1) Is not an inpatient of a hospital, SNF, nursing home, or
hospice.
(2) Is not receiving services in an RHC, FQHC or ESRD dialysis
facility.
[66 FR 55332, Nov. 1, 2001]
[[Page 22]]
Sec. 414.65 Payment for telehealth services.
(a) Professional service. The Medicare payment amount for telehealth
services described under Sec. 410.78 of this chapter is equal to the
current fee schedule amount applicable for the service of the physician
or practitioner, subject to paragraphs (a)(1) and (2) of this section,
but must be made in accordance with the following limitations:
(1) Only the physician or practitioner at the distant site may bill
and receive payment for the professional service via an interactive
telecommunications system.
(2) Payments made to the physician or practitioner at the distant
site, including deductible and coinsurance, for the professional service
may not be shared with the referring practitioner or telepresenter.
(b) Originating site facility fee. For telehealth services furnished
on or after October 1, 2001:
(1) For services furnished on or after October 1, 2001 through
December 31, 2002, the payment amount to the originating site is the
lesser of the actual charge or the originating site facility fee of $20.
For services furnished on or after January 1 of each subsequent year,
the facility fee for the originating site will be updated by the
Medicare Economic Index (MEI) as defined in section 1842(i)(3) of the
Act.
(2) Only the originating site may bill for the originating site
facility fee and only on an assignment-related basis. The distant site
physician or practitioner may not bill for or receive payment for
facility fees associated with the professional service furnished via an
interactive telecommunications system.
(3) No originating site facility fee payment is made to an
originating site described in Sec. 410.78(b)(3)(x), (xi), or (xii); or
to an originating site for services furnished under the exception at
Sec. 410.78(b)(4)(iv)(A) or (B) of this chapter.
(c) Deductible and coinsurance apply. The payment for the
professional service and originating site facility fee is subject to the
coinsurance and deductible requirements of sections 1833(a)(1) and (b)
of the Act.
(d) Assignment required for physicians, practitioners, and
originating sites. Payment to physicians, practitioners, and originating
sites is made only on an assignment-related basis.
(e) Sanctions. A distant site practitioner or originating site
facility may be subject to the applicable sanctions provided for in
chapter IV, part 402 and chapter V, parts 1001, 1002, and 1003 of this
title if he or she does any of the following:
(1) Knowingly and willfully bills or collects for services in
violation of the limitation of this section.
(2) Fails to timely correct excess charges by reducing the actual
charge billed for the service in an amount that does not exceed the
limiting charge for the service or fails to timely refund excess
collections.
(3) Fails to submit a claim on a standard form for services provided
for which payment is made on a fee schedule basis.
(4) Imposes a charge for completing and submitting the standard
claims form.
[66 FR 55332, Nov. 1, 2001, as amended at 67 FR 80041, Dec. 31, 2003; 69
FR 66424, Nov. 15, 2004; 70 FR 70332, Nov. 21, 2005; 72 FR 66401, Nov.
27, 2007; 73 FR 69936, Nov. 19, 2008; 74 FR 62006, Nov. 25, 2009; 75 FR
73617, Nov. 29, 2010; 76 FR 73471, Nov. 28, 2011; 77 FR 69363, Nov. 16,
2012; 78 FR 74812, Dec. 10, 2013; 83 FR 60074, Nov. 23, 2018]
Sec. 414.66 Incentive payments for physician scarcity areas.
(a) Definition. As used in this section, the following definitions
apply.
Physician scarcity area is defined as an area with a shortage of
primary care physicians or specialty physicians to the Medicare
population in that area.
Primary care physician is defined as a general practitioner, family
practice practitioner, general internist, obstetrician or gynecologist.
(b) Physicians' services furnished to a beneficiary in a Physician
Scarcity Area (PSA) for primary or specialist care are eligible for a 5
percent incentive payment.
(c) Primary care physicians furnishing services in primary care PSAs
are entitled to an additional 5 percent incentive payment above the
amount paid under the physician fee schedule
[[Page 23]]
for their professional services furnished on or after January 1, 2005
and before January 1, 2008.
(d) Physicians, as defined in section 1861(r)(1) of the Act,
furnishing services in specialist care PSAs are entitled to an
additional 5 percent payment above the amount paid under the physician
fee schedule for their professional services furnished on or after
January 1, 2005 and before January 1, 2008.
[69 FR 66424, Nov. 15, 2004]
Sec. 414.67 Incentive payments for services furnished
in Health Professional Shortage Areas.
(a) Health Professional Shortage Area (HPSA) physician bonus
program. A HPSA physician incentive payment will be made subject to the
following:
(1) HPSA bonuses are payable for services furnished by physicians as
defined in section 1861(r) of the Act in areas designated as of December
31 of the prior year as geographic primary medical care HPSAs as defined
in section 332(a)(1)(A) of the Public Health Service Act.
(2) HPSA bonuses are payable for services furnished by psychiatrists
in areas designated as of December 31 of the prior year as geographic
mental health HPSAs if the services are not already eligible for the
bonus based on being in a geographic primary care HPSA.
(3) Physicians eligible for the HPSA physician bonus are entitled to
a 10 percent incentive payment above the amount paid for their
professional services under the physician fee schedule.
(4) Physicians furnishing services in areas that are designated as
geographic HPSAs prior to the beginning of the year but not included on
the published list of zip codes for which automated HPSA bonus payments
are made must use the AQ modifier to receive the HPSA physician bonus
payment.
(b) HPSA surgical incentive payment program. A HPSA surgical
incentive payment will be made subject to the following:
(1) A major surgical procedure as defined in Sec. 414.2 of this
part is furnished by a general surgeon on or after January 1, 2011 and
before January 1, 2016 in an area recognized for the HPSA physician
bonus program under paragraph (a)(1) of this section.
(2) Payment will be made on a quarterly basis in an amount equal to
10 percent of the Part B payment amount for major surgical procedures
furnished as described in paragraph (b)(1) of this section, in addition
to the amount the physician would otherwise be paid.
(3) Physicians furnishing services in areas that are designated as
geographic HPSAs eligible for the HPSA physician bonus program under
paragraph (a)(1) of this section prior to the beginning of the year but
not included on the published list of zip codes for which automated HPSA
surgical incentive payments are made should report HCPCS modifier -AQ to
receive the HPSA surgical incentive payment.
(4) The payment described in paragraph (b)(2) of this section is
made to the surgeon or, where the surgeon has reassigned his or her
benefits to a critical access hospital (CAH) paid under the optional
method, to the CAH based on an institutional claim.
[75 FR 73617, Nov. 29, 2010]
Sec. 414.68 Imaging accreditation.
(a) Scope and purpose. Section 1834(e) of the Act requires the
Secretary to designate and approve independent accreditation
organizations for purposes of accrediting suppliers furnishing the
technical component (TC) of advanced diagnostic imaging services and
establish procedures to ensure that the criteria used by an
accreditation organization is specific to each imaging modality.
Suppliers of the TC of advanced diagnostic imaging services for which
payment is made under the fee schedule established in section 1848(b) of
the Act must become accredited by an accreditation organization
designated by the Secretary beginning January 1, 2012.
(b) Definitions. As used in this section, the following definitions
are applicable:
Accredited supplier means a supplier that has been accredited by a
CMS-designated accreditation organization as specified in this part.
Advanced diagnostic imaging service means any of the following
diagnostic services:
(i) Magnetic resonance imaging.
[[Page 24]]
(ii) Computed tomography.
(iii) Nuclear medicine.
(iv) Positron emission tomography.
CMS-approved accreditation organization means an accreditation
organization designated by CMS to perform the accreditation functions
specified in section 1834(e) of the Act.
(c) Application and reapplication procedures for accreditation
organizations. An independent accreditation organization applying for
approval or reapproval of authority to survey suppliers for purposes of
accrediting suppliers furnishing the TC of advanced diagnostic imaging
services is required to furnish CMS with all of the following:
(1) A detailed description of how the organization's accreditation
criteria satisfy the statutory standards authorized by section
1834(e)(3) of the Act, specifically--
(i) Qualifications of medical personnel who are not physicians and
who furnish the TC of advanced diagnostic imaging services;
(ii) Qualifications and responsibilities of medical directors and
supervising physicians (who may be the same person), such as their
training in advanced diagnostic imaging services in a residency program,
expertise obtained through experience, or continuing medical education
courses;
(iii) Procedures to ensure the reliability, clarity, and accuracy of
the technical quality of diagnostic images produced by the supplier,
including a thorough evaluation of equipment performance and safety;
(iv) Procedures to ensure the safety of persons who furnish the TC
of advanced diagnostic imaging services and individuals to whom such
services are furnished;
(v) Procedures to assist the beneficiary in obtaining the
beneficiary's imaging records on request; and
(vi) Procedures to notify the accreditation organization of any
changes to the modalities subsequent to the organization's accreditation
decision.
(2) An agreement to conform accreditation requirements to any
changes in Medicare statutory requirements authorized by section 1834(e)
of the Act. The accreditation organization must maintain or adopt
standards that are equal to, or more stringent than, those of Medicare.
(3) Information that demonstrates the accreditation organization's
knowledge and experience in the advanced diagnostic imaging arena.
(4) The organization's proposed fees for accreditation for each
modality in which the organization intends to offer accreditation,
including any plans for reducing the burden and cost of accreditation to
small and rural suppliers.
(5) Any specific documentation requirements and attestations
requested by CMS as a condition of designation under this part.
(6) A detailed description of the organization's survey process,
including the following:
(i) Type and frequency of the surveys performed.
(ii) The ability of the organization to conduct timely reviews of
accreditation applications, to include the organizations national
capacity.
(iii) Description of the organization's audit procedures, including
random site visits, site audits, or other strategies for ensuring
suppliers maintain compliance for the duration of accreditation.
(iv) Procedures for performing unannounced site surveys.
(v) Copies of the organization's survey forms.
(vi) A description of the accreditation survey review process and
the accreditation status decision-making process, including the process
for addressing deficiencies identified with the accreditation
requirements, and the procedures used to monitor the correction of
deficiencies found during an accreditation survey.
(vii) Procedures for coordinating surveys with another accrediting
organization if the organization does not accredit all products the
supplier provides.
(viii) Detailed information about the individuals who perform
evaluations for the accreditation organization, including all of the
following information:
(A) The number of professional and technical staff that are
available for surveys.
[[Page 25]]
(B) The education, employment, and experience requirements surveyors
must meet.
(C) The content and length of the orientation program.
(ix) The frequency and types of in-service training provided to
survey personnel.
(x) The evaluation systems used to monitor the performance of
individual surveyors and survey teams.
(xi) The policies and procedures regarding an individual's
participation in the survey or accreditation decision process of any
organization with which the individual is professionally or financially
affiliated.
(xii) The policies and procedures used when an organization has a
dispute regarding survey findings or an adverse decision.
(7) Detailed information about the size and composition of survey
teams for each category of advanced medical imaging service supplier
accredited.
(8) A description of the organization's data management and analysis
system for its surveys and accreditation decisions, including the kinds
of reports, tables, and other displays generated by that system.
(9) The organization's procedures for responding to and for the
investigation of complaints against accredited facilities, including
policies and procedures regarding coordination of these activities with
appropriate licensing bodies and CMS.
(10) The organization's policies and procedures for the withholding
or removal of accreditation status for facilities that fail to meet the
accreditation organization's standards or requirements, and other
actions taken by the organization in response to noncompliance with its
standards and requirements. These policies and procedures must include
notifying CMS of Medicare facilities that fail to meet the requirements
of the accrediting organization.
(11) A list of all currently accredited suppliers, the type and
category of accreditation currently held by each supplier, and the
expiration date of each supplier's current accreditation.
(12) A written presentation that demonstrates the organization's
ability to furnish CMS with electronic data in ASCII comparable code.
(13) A resource analysis that demonstrates that the organization's
staffing, funding, and other resources are adequate to perform the
required surveys and related activities.
(14) A statement acknowledging that, as a condition for approval of
designation, the organization agrees to carry out the following
activities:
(i) Prioritize surveys for those suppliers needing to be accredited
by January 1, 2012.
(ii) Notify CMS, in writing, of any Medicare supplier that had its
accreditation revoked, withdrawn, revised, or any other remedial or
adverse action taken against it by the accreditation organization within
30 calendar days of any such action taken.
(iii) Notify all accredited suppliers within 10 calendar days of the
organization's removal from the list of designated accreditation
organizations.
(iv) Notify CMS, in writing, at least 30 calendar days in advance of
the effective date of any significant proposed changes in its
accreditation requirements.
(v) Permit its surveyors to serve as witnesses if CMS takes an
adverse action based on accreditation findings.
(vi) Notify CMS, in writing (electronically or hard copy), within 2
business days of a deficiency identified in any accreditation supplier
from any source where the deficiency poses an immediate jeopardy to the
supplier's beneficiaries or a hazard to the general public.
(vii) Provide, on an annual basis, summary data specified by CMS
that relates to the past year's accreditations and trends.
(viii) Attest that the organization will not perform any
accreditation surveys of Medicare-participating suppliers with which it
has a financial relationship in which it has an interest.
(ix) Conform accreditation requirements to changes in Medicare
requirements.
(x) If CMS withdraws an accreditation organization's approved
status, work collaboratively with CMS to direct suppliers to the
remaining accreditation organizations within a reasonable period of
time.
[[Page 26]]
(d) Determination of whether additional information is needed. If
CMS determines that additional information is necessary to make a
determination for approval or denial of the accreditation organization's
application for designation, the organization must be notified and
afforded an opportunity to provide the additional information.
(e) Visits to the organization's office. CMS may visit the
organization's offices to verify representations made by the
organization in its application, including, but not limited to,
reviewing documents and interviewing the organization's staff.
(f) Formal notice from CMS. The accreditation organization will
receive a formal notice from CMS stating whether the request for
designation has been approved or denied. If approval was denied the
notice includes the basis for denial and reconsideration and
reapplication procedures.
(g) Ongoing responsibilities of a CMS-approved accreditation
organization. An accreditation organization approved by CMS must carry
out the following activities on an ongoing basis:
(1) Provide CMS with all of the following in written format (either
electronic or hard copy):
(i) Copies of all accreditation surveys, together with any survey-
related information that CMS may require (including corrective action
plans and summaries of findings with respect to unmet CMS requirements).
(ii) Notice of all accreditation decisions.
(iii) Notice of all complaints related to suppliers.
(iv) Information about all accredited suppliers against which the
accreditation organization has taken remedial or adverse action,
including revocation, withdrawal, or revision of the supplier's
accreditation.
(v) Notice of any proposed changes in its accreditation standards or
requirements or survey process. If the organization implements the
changes before or without CMS' approval, CMS may withdraw its approval
of the accreditation organization.
(2) Within 30 calendar days after a change in CMS requirements, the
accreditation organization must submit an acknowledgment of receipt of
CMS' notification to CMS.
(3) The accreditation organization must permit its surveyors to
serve as witnesses if CMS takes an adverse action based on accreditation
findings.
(4) Within 2 business days of identifying a deficiency of an
accredited supplier that poses immediate jeopardy to a beneficiary or to
the general public, the accreditation organization must provide CMS with
written notice of the deficiency and any adverse action implemented by
the accreditation organization.
(5) Within 10 calendar days after CMS' notice to a CMS-approved
accreditation organization that CMS intends to withdraw approval of the
accreditation organization, the accreditation organization must provide
written notice of the withdrawal to all of the organization's accredited
suppliers.
(6) The organization must provide, on an annual basis, summary data
specified by CMS that relate to the past year's accreditation activities
and trends.
(h) Continuing Federal oversight of approved accreditation
organizations. This paragraph establishes specific criteria and
procedures for continuing oversight and for withdrawing approval of a
CMS-approved accreditation organization.
(1) Validation audits. (i) CMS or its contractor may conduct an
audit of an accredited supplier to validate the survey accreditation
process of approved accreditation organizations for the TC of advanced
diagnostic imaging services.
(ii) The audits must be conducted on a representative sample of
suppliers who have been accredited by a particular accrediting
organization or in response to allegations of supplier noncompliance
with the standards.
(A) When conducted on a representative sample basis, the audit is
comprehensive and addresses all of the standards, or may focus on a
specific standard in issue.
(B) When conducted in response to an allegation, CMS audits any
standards that CMS determines are related to the allegations.
(2) Notice of intent to withdraw approval. (i) If, during the audit
specified
[[Page 27]]
in paragraph (h)(1) of this section, CMS identifies any accreditation
programs for which validation audit results indicate--
(A) A 10 percent or greater rate of disparity between findings by
the accreditation organization and findings by CMS on standards that do
not constitute immediate jeopardy to patient health and safety if unmet;
or
(B) Any disparity between findings by the accreditation organization
and findings by CMS on standards that constitute immediate jeopardy to
patient health and safety if unmet; or,
(C) Irrespective of the rate of disparity, widespread or systemic
problems in an organization's accreditation process such that
accreditation by that accreditation organization no longer provides CMS
with adequate assurance that suppliers meet or exceed the Medicare
requirements; then CMS will give the organization written notice of its
intent to withdraw approval as specified in paragraph (h)(3) of this
section.
(ii) CMS may also provide the organization written notice of its
intent to withdraw approval if an equivalency review, onsite
observation, or CMS' daily experience with the accreditation
organization suggests that the accreditation organization is not meeting
the requirements of this section.
(3) Withdrawal of approval. CMS may withdraw its approval of an
accreditation organization at any time if CMS determines that--
(i) Accreditation by the organization no longer adequately assures
that the suppliers furnishing the technical component of advanced
diagnostic imaging service are meeting the established industry
standards for each modality and that failure to meet those requirements
could jeopardize the health or safety of Medicare beneficiaries and
could constitute a significant hazard to the public health; or
(ii) The accreditation organization has failed to meet its
obligations with respect to application or reapplication procedures.
(i) Reconsideration. An accreditation organization dissatisfied with
a determination that its accreditation requirements do not provide or do
not continue to provide reasonable assurance that the suppliers
accredited by the accreditation organization meet the applicable quality
standards is entitled to a reconsideration. CMS reconsiders any
determination to deny, remove, or not renew the approval of designation
to accreditation organizations if the accreditation organization files a
written request for reconsideration by its authorized officials or
through its legal representative.
(1) Filing requirements. (i) The request must be filed within 30
calendar days of the receipt of CMS notice of an adverse determination
or non-renewal.
(ii) The request for reconsideration must specify the findings or
issues with which the accreditation organization disagrees and the
reasons for the disagreement.
(iii) A requestor may withdraw its request for reconsideration at
any time before the issuance of a reconsideration determination.
(2) CMS response to a filing request. In response to a request for
reconsideration, CMS provides the accreditation organization with--
(i) The opportunity for an informal hearing to be conducted by a
hearing officer appointed by the Administrator of CMS and provide the
accreditation organization the opportunity to present, in writing and in
person, evidence or documentation to refute the determination to deny
approval, or to withdraw or not renew designation; and
(ii) Written notice of the time and place of the informal hearing at
least 10 business days before the scheduled date.
(3) Hearing requirements and rules. (i) The informal reconsideration
hearing is open to all of the following:
(A) CMS.
(B) The organization requesting the reconsideration including--
(1) Authorized representatives;
(2) Technical advisors (individuals with knowledge of the facts of
the case or presenting interpretation of the facts); and
(3) Legal counsel.
(ii) The hearing is conducted by the hearing officer who receives
testimony and documents related to the proposed action.
(iii) Testimony and other evidence may be accepted by the hearing
officer
[[Page 28]]
even though such evidence may be inadmissible under the Federal Rules of
Civil Procedure.
(iv) The hearing officer does not have the authority to compel by
subpoena the production of witnesses, papers, or other evidence.
(v) Within 45 calendar days of the close of the hearing, the hearing
officer presents the findings and recommendations to the accreditation
organization that requested the reconsideration.
(vi) The written report of the hearing officer includes separate
numbered findings of fact and the legal conclusions of the hearing
officer.
(vii) The hearing officer's decision is final.
[74 FR 62006, Nov. 25, 2009]
Sec. 414.80 Incentive payment for primary care services.
(a) Definitions. As defined in this section--
Eligible primary care practitioner means one of the following:
(i) A physician (as defined in section 1861(r)(1) of the Act) who
meets all of the following criteria:
(A) Enrolled in Medicare with a primary specialty designation of 08-
family practice, 11-internal medicine, 37-pediatrics, or 38-geriatrics.
(B) At least 60 percent of the physician's allowed charges under the
physician fee schedule (excluding hospital inpatient care and emergency
department visits) during a reference period specified by the Secretary
are for primary care services.
(ii) A nurse practitioner, clinical nurse specialist, or physician
assistant (as defined in section 1861(aa)(5) of the Act) who meets all
of the following criteria:
(A) Enrolled in Medicare with a primary specialty designation of 50-
nurse practitioner, 89-certified clinical nurse, or 97-physician
assistant.
(B) At least 60 percent of the practitioner's allowed charges under
the physician fee schedule (excluding hospital inpatient care and
emergency department visits) during a reference period specified by the
Secretary are for primary care services.
Primary care services means--
(i) New and established patient office or other outpatient
evaluation and management (E/M) visits;
(ii) Initial, subsequent, discharge, and other nursing facility E/M
services;
(iii) New and established patient domiciliary, rest home (for
example, boarding home), or custodial care E/M services;
(iv) Domiciliary, rest home (for example, assisted living facility),
or home care plan oversight services; and
(v) New and established patient home E/M visits.
(b) Payment. (1) For primary care services furnished by an eligible
primary care practitioner on or after January 1, 2011 and before January
1, 2016, payment is made on a quarterly basis in an amount equal to 10
percent of the payment amount for the primary care services under Part
B, in addition to the amount the primary care practitioner would
otherwise be paid for the primary care services under Part B.
(2) The payment described in paragraph (b)(1) of this section is
made to the eligible primary care practitioner or, where the physician
has reassigned his or her benefits to a critical access hospital (CAH)
paid under the optional method, to the CAH based on an institutional
claim.
[75 FR 73617, Nov. 29, 2010]
Sec. 414.84 Payment for MDPP services.
(a) Definitions. In addition to the definitions specified at Sec.
410.79(b) and Sec. 424.205(a) of this chapter, the following
definitions apply to this section.
Bridge payment means a one-time payment to an MDPP supplier for
furnishing its first MDPP session to an MDPP beneficiary who has
previously received one or more MDPP services from a different MDPP
supplier.
Performance goal means an attendance or weight loss goal that an
MDPP beneficiary must achieve during the MDPP services period for an
MDPP supplier to be paid a performance payment.
Performance payment means a payment made to an MDPP supplier for
furnishing certain MDPP services to an MDPP beneficiary when the MDPP
beneficiary achieves the applicable performance goal.
[[Page 29]]
(b) Performance payment. CMS makes one or more types of performance
payments to an MDPP supplier as specified in this paragraph (b). Each
type of performance payment is made only if the beneficiary achieves the
applicable performance goal and only once per MDPP beneficiary. A
performance payment is made only on an assignment-related basis in
accordance with Sec. 424.55 of this chapter, and MDPP suppliers must
accept the Medicare allowed charge as payment in full and may not bill
or collect from the beneficiary any amount. CMS will make a performance
payment only to an MDPP supplier that complies with all applicable
enrollment and program requirements and only for MDPP services that are
furnished by an eligible coach, on or after his or her coach eligibility
start date and, if applicable, before his or her coach eligibility end
date. As a condition of payment, the MDPP supplier must report the NPI
of the coach who furnished the session on the claim for the MDPP
session. The seven types of performance payments are as follows:
(1) Performance Goal 1: Attends the first core session that
initiates the MDPP services period. CMS makes a performance payment to
an MDPP supplier if an MDPP beneficiary attends the first core session,
which initiates the MDPP services period, and that first core session
was furnished by that supplier. An MDPP supplier that has been paid this
performance payment for an MDPP beneficiary is not eligible to be paid a
bridge payment described in paragraph (c) of this section for that MDPP
beneficiary. The amount of this performance payment is determined as
follows:
(i) For a first core session furnished April 1 through December 31,
2018. $25.
(ii) For a first core session furnished during a calendar year
subsequent to CY 2018. The performance payment amount specified in this
paragraph for the prior year, adjusted as specified in paragraph (d) of
this section.
(2) Performance Goal 2: Attends four core sessions. CMS makes a
performance payment to an MDPP supplier if an MDPP beneficiary achieves
attendance at the fourth core session upon attendance at a core session
furnished by that supplier. The amount of this performance payment is
determined as follows:
(i) For a fourth core session furnished April 1 through December 31,
2018. $50.
(ii) For a fourth core session furnished during a calendar year
subsequent to CY 2018. The performance payment amount specified in this
paragraph for the prior year, adjusted as specified in paragraph (d) of
this section.
(3) Performance Goal 3: Attends nine core sessions. CMS makes a
performance payment to an MDPP supplier if an MDPP beneficiary achieves
attendance at the ninth core session upon attendance at a core session
furnished by that supplier. The amount of this performance payment is
determined as follows:
(i) For a ninth core session furnished April 1 through December 31,
2018. $90.
(ii) For a ninth core session furnished during a calendar year
subsequent to CY 2018. The performance payment amount specified in this
paragraph for the prior year, adjusted as specified in paragraph (d) of
this section.
(4) Performance Goal 4: Attends two core maintenance sessions during
a core maintenance session interval. CMS makes a performance payment to
an MDPP supplier if an MDPP beneficiary attends two core maintenance
sessions in a core maintenance session interval and achieves attendance
at the second core maintenance session upon attendance at a core
maintenance session furnished by that supplier. CMS makes this
performance payment to an MDPP supplier only once per MDPP beneficiary
per core maintenance session interval. The amount of this performance
payment is determined as follows:
(i) If the beneficiary also achieves or maintains the required
minimum weight loss as measured in-person during a core maintenance
session furnished during the applicable core maintenance session
interval:
(A) For a second core maintenance session furnished April 1 through
December 31, 2018. $60.
(B) For a second core maintenance session furnished during a
calendar year subsequent to CY 2018. The performance payment amount
specified in this paragraph for the prior year, adjusted as specified in
paragraph (d) of this section.
[[Page 30]]
(ii) If the beneficiary does not achieve or maintain the required
minimum weight loss as measured in-person during a core maintenance
session furnished during the applicable core maintenance session
interval:
(A) For a second core maintenance session furnished April 1 through
December 31, 2018. $15.
(B) For a second core maintenance session furnished during a
calendar year subsequent to CY 2018. The performance payment amount
specified in this paragraph for the prior year, adjusted as specified in
paragraph (d) of this section.
(5) Performance Goal 5: Attends two ongoing maintenance sessions and
maintains the required minimum weight loss during an ongoing maintenance
session interval. CMS makes a performance payment to an MDPP supplier if
an MDPP beneficiary attends two ongoing maintenance sessions during an
ongoing maintenance session interval, achieves attendance at that second
ongoing maintenance session upon attendance at an ongoing maintenance
session furnished by that supplier, and achieves or maintains the
required minimum weight loss as measured in-person during an ongoing
maintenance session furnished during the applicable ongoing maintenance
session interval. CMS makes this performance payment to an MDPP supplier
only once per MDPP beneficiary per ongoing maintenance session interval.
The amount of this performance payment is determined as follows:
(i) For a second ongoing maintenance session furnished April 1
through December 31, 2018. $50.
(ii) For a second ongoing maintenance session furnished during a
calendar year subsequent to CY 2018. The performance payment amount
specified in this paragraph for the prior year, adjusted as specified in
paragraph (d) of this section.
(6) Performance Goal 6: Achieves the required minimum weight loss.
CMS makes a performance payment to an MDPP supplier for an MDPP
beneficiary who achieves the required minimum weight loss as measured
in-person during a core session or core maintenance session furnished by
that supplier. The amount of this performance payment is determined as
follows:
(i) For a core session or core maintenance session, as applicable,
furnished April 1 through December 31, 2018. $160.
(ii) For a core session or core maintenance session, as applicable,
furnished during a calendar year subsequent to CY 2018. The performance
payment amount specified in this paragraph for the prior year, adjusted
as specified in paragraph (d) of this section.
(7) Performance Goal 7: Achieves 9-percent weight loss. CMS makes a
performance payment to an MDPP supplier for an MDPP beneficiary who
achieves at least a 9-percent weight loss as measured in-person during a
core session, core maintenance session, or ongoing maintenance session
furnished by that supplier. The amount of this performance payment is
determined as follows:
(i) For a core session, core maintenance session, or ongoing
maintenance session, as applicable, furnished April 1 through December
31, 2018. $25.
(ii) For a core session, core maintenance session, or ongoing
maintenance session, as applicable, furnished during a calendar year
subsequent to CY 2018. The performance payment amount specified in this
paragraph for the prior year, adjusted as specified in paragraph (d) of
this section.
(c) Bridge payment. CMS makes a bridge payment to an MDPP supplier
only for a core session, core maintenance session, or ongoing
maintenance session furnished to an MDPP beneficiary who has previously
received MDPP services from a different MDPP supplier. An MDPP supplier
that has previously been paid either a bridge payment or a performance
payment for an MDPP beneficiary is not eligible to be paid a bridge
payment for that beneficiary. A bridge payment is made only on an
assignment-related basis in accordance with Sec. 424.55 of this
chapter, and MDPP suppliers must accept the Medicare allowed charge as
payment in full and may not bill or collect from the beneficiary any
amount. CMS will make a bridge payment only to an MDPP supplier that
complies with all applicable enrollment and program requirements, and
only for MDPP services furnished by an eligible coach, on or after his
or her coach eligibility start date and, if applicable, before his or
her coach eligibility end date. As a
[[Page 31]]
condition of payment, the MDPP supplier must report the NPI of the coach
who furnished the session on the claim for the MDPP session. The amount
of the bridge payment is determined as follows:
(1) For a core session, core maintenance session, or ongoing
maintenance session, as applicable, furnished April 1 through December
31, 2018. $25.
(2) For a core session, core maintenance session, or ongoing
maintenance session, as applicable, furnished during a calendar year
subsequent to CY 2018. The bridge payment amount specified in this
paragraph for the prior year, adjusted as specified in paragraph (d) of
this section.
(d) Updating performance payments and the bridge payment. The
performance payments and bridge payment will be adjusted each calendar
year by the percent change in the Consumer Price Index for All Urban
Consumers (CPI-U) (U.S. city average) for the 12-month period ending
June 30th of the year preceding the update year. The percent change
update will be calculated based on the level of precision of the index
as published by the Bureau of Labor Statistics and applied based on one
decimal place of precision. The annual MDPP services payment update will
be published by CMS transmittal.
[82 FR 53360, Nov. 15, 2017]
Sec. 414.90 Physician Quality Reporting System (PQRS).
(a) Basis and scope. This section implements the following
provisions of the Act:
(1) 1848(a)--Payment Based on Fee Schedule.
(2) 1848(k)--Quality Reporting System.
(3) 1848(m)--Incentive Payments for Quality Reporting.
(b) Definitions. As used in this section, unless otherwise
indicated--
Administrative claims means a reporting mechanism under which an
eligible professional or group practice uses claims to report data on
PQRS quality measures. Under this reporting mechanism, CMS analyzes
claims data to determine which measures an eligible professional or
group practice reports.
Certified survey vendor means a vendor that is certified by CMS for
a particular program year to transmit survey measures data to CMS.
Covered professional services means services for which payment is
made under, or is based on, the Medicare physician fee schedule as
provided under section 1848(k)(3) of the Act and which are furnished by
an eligible professional.
Direct electronic health record (EHR) product means an electronic
health record vendor's product and version that submits data on PQRS
measures directly to CMS.
Electronic health record (EHR) data submission vendor product means
an entity that receives and transmits data on PQRS measures from an EHR
product to CMS.
Eligible professional means any of the following:
(i) A physician.
(ii) A practitioner described in section 1842(b)(18)(C) of the Act.
(iii) A physical or occupational therapist or a qualified speech-
language pathologist.
(iv) A qualified audiologist (as defined in section 1861(ll)(3)(B)
of the Act).
Group practice means a physician group practice that is defined by a
TIN, with 2 or more individual eligible professionals (or, as identified
by NPIs) that has reassigned their billing rights to the TIN.
Group practice reporting option (GPRO) web interface means a web
product developed by CMS that is used by group practices that are
selected to participate in the group practice reporting option (GPRO) to
submit data on PQRS quality measures.
Maintenance of Certification Program means a continuous assessment
program, such as qualified American Board of Medical Specialties
Maintenance of Certification Program or an equivalent program (as
determined by the Secretary), that advances quality and the lifelong
learning and self-assessment of board certified specialty physicians by
focusing on the competencies of patient care, medical knowledge,
practice-based learning, interpersonal and communication skills, and
professionalism. Such a program must include the following:
[[Page 32]]
(i) The program requires the physician to maintain a valid
unrestricted license in the United States.
(ii) The program requires a physician to participate in educational
and self-assessment programs that require an assessment of what was
learned.
(iii) The program requires a physician to demonstrate, through a
formalized secure examination, that the physician has the fundamental
diagnostic skills, medical knowledge, and clinical judgment to provide
quality care in their respective specialty.
(iv) The program requires successful completion of a qualified
maintenance of certification program practice assessment.
Maintenance of Certification Program Practice Assessment means an
assessment of a physician's practice that--
(i) Includes an initial assessment of an eligible professional's
practice that is designed to demonstrate the physician's use of
evidence-based medicine.
(ii) Includes a survey of patient experience with care.
(iii) Requires a physician to implement a quality improvement
intervention to address a practice weakness identified in the initial
assessment under paragraph (h) of this section and then to remeasure to
assess performance improvement after such intervention.
Measures group means a subset of six or more PQRS measures that have
a particular clinical condition or focus in common. The denominator
definition and coding of the measures group identifies the condition or
focus that is shared across the measures within a particular measures
group.
Physician Quality Reporting System (PQRS) means the physician
reporting system under section 1848(k) of the Act for the reporting by
eligible professionals of data on quality measures and the incentive
payment associated with this physician reporting system.
Performance rate means the percentage of a defined population who
receives a particular process of care or achieve a particular outcome
for a particular quality measure.
Qualified clinical data registry means a CMS-approved entity that
has self-nominated and successfully completed a qualification process
that collects medical and/or clinical data for the purpose of patient
and disease tracking to foster improvement in the quality of care
provided to patients. A qualified clinical data registry must perform
the following functions:
(i) Submit quality measures data or results to CMS for purposes of
demonstrating that, for a reporting period, its eligible professionals
have satisfactorily participated in PQRS. A qualified clinical data
registry must have in place mechanisms for the transparency of data
elements and specifications, risk models, and measures.
(ii) Submit to CMS, for purposes of demonstrating satisfactory
participation, quality measures data on multiple payers, not just
Medicare patients.
(iii) Provide timely feedback, at least four times a year, on the
measures at the individual participant level for which the qualified
clinical data registry reports on the eligible professional's behalf for
purposes of the individual eligible professional's satisfactory
participation in the clinical quality data registry.
(iv) Possess benchmarking capacity that measures the quality of care
an eligible professional provides with other eligible professionals
performing the same or similar functions.
Qualified registry means a medical registry or a maintenance of
certification program operated by a specialty body of the American Board
of Medical Specialties that, with respect to a particular program year,
has self-nominated and successfully completed a vetting process (as
specified by CMS) to demonstrate its compliance with the PQRS
qualification requirements specified by CMS for that program year. The
registry may act as a data submission vendor, which has the requisite
legal authority to provide PQRS data (as specified by CMS) on behalf of
an eligible professional to CMS. If CMS finds that a qualified registry
submits grossly inaccurate data for reporting periods occurring in a
particular year, CMS reserves the right to disqualify a registry for
reporting periods occurring in the subsequent year.
Reporting rate means the percentage of patients that the eligible
professional indicated a quality action was or
[[Page 33]]
was not performed divided by the total number of patients in the
denominator of the measure.
(c) Incentive payments. For 2007 to 2014, with respect to covered
professional services furnished during a reporting period by an eligible
professional, an eligible professional (or in the case of a group
practice under paragraph (i) of this section, a group practice) may
receive an incentive if--
(1) There are any quality measures that have been established under
the PQRS that are applicable to any such services furnished by such
professional (or in the case of a group practice under paragraph (i) of
this section, such group practice) for such reporting period; and
(2) If the eligible professional (or in the case of a group practice
under paragraph (j) of this section, the group practice) satisfactorily
submits (as determined under paragraph (g) of this section for the
eligible professional and paragraph (i) of this section for the group
practice) to the Secretary data on such quality measures in accordance
with the PQRS for such reporting period, in addition to the amount
otherwise paid under section 1848 of the Act, there also must be paid to
the eligible professional (or to an employer or facility in the cases
described in section 1842(b)(6)(A) of the Act or, in the case of a group
practice under paragraph (i) of this section, to the group practice)
from the Federal Supplementary Medical Insurance Trust Fund established
under section 1841 of the Act an amount equal to the applicable quality
percent (as specified in paragraph (c)(3) of this section) of the
eligible professional's (or, in the case of a group practice under
paragraph (i) of this section, the group practice's) total estimated
allowed charges for all covered professional services furnished by the
eligible professional (or, in the case of a group practice under
paragraph (i) of this section, by the group practice) during the
reporting period.
(3) The applicable quality percent is as follows:
(i) For 2007 and 2008, 1.5 percent.
(ii) For 2009 and 2010, 2.0 percent.
(iii) For 2011, 1.0 percent.
(iv) For 2012, 2013, and 2014, 0.5 percent.
(4) For purposes of this paragraph (c)--
(i) The eligible professional's (or, in the case of a group practice
under paragraph (i) of this section, the group practice's) total
estimated allowed charges for covered professional services furnished
during a reporting period are determined based on claims processed in
the National Claims History (NCH) no later than 2 months after the end
of the applicable reporting period;
(ii) In the case of the eligible professional who furnishes covered
professional services in more than one practice, incentive payments are
separately determined for each practice based on claims submitted for
the eligible professional for each practice;
(iii) Incentive payments to a group practice under this paragraph
must be in lieu of the payments that would otherwise be made under the
PQRS to eligible professionals in the group practice for meeting the
criteria for satisfactory reporting for individual eligible
professionals. For any program year in which the group practice (as
identified by the TIN) is selected to participate in the PQRS group
practice reporting option, the eligible professional cannot individually
qualify for a PQRS incentive payment by meeting the requirements
specified in paragraph (g) of this section.
(iv) Incentive payments earned by the eligible professional (or in
the case of a group practice under paragraph (i) of this section, by the
group practice) for a particular program year will be paid as a single
consolidated payment to the TIN holder of record.
(5) The Secretary must treat an individual eligible professional, as
identified by a unique TIN/NPI combination, as satisfactorily submitting
data on quality measures (as determined under paragraph (g) of this
section), if the eligible professional is satisfactorily participating
(as determined under paragraph (h) of this section), in a qualified
clinical data registry.
(d) Additional incentive payment. Through 2014, if an eligible
professional meets the requirements described in paragraph (d)(2) of
this section, the applicable percent for such year, as described in
paragraphs (c)(3)(iii) and (iv)
[[Page 34]]
of this section, must be increased by 0.5 percentage points.
(1) In order to qualify for the additional incentive payment
described in paragraph (d) of this section, an eligible professional
must meet all of the following requirements:
(i) Satisfactorily submits data on quality measures, or, for 2014,
in lieu of satisfactory reporting, satisfactorily participates in a
qualified clinical data registry for purposes of this section for the
applicable incentive year.
(ii) Have such data submitted on their behalf through a Maintenance
of Certification program that meets:
(A) The criteria for a registry (as specified by CMS); or
(B) An alternative form and manner determined appropriate by the
Secretary.
(iii) The eligible professional, more frequently than is required to
qualify for or maintain board certification status--
(A) Participates in a maintenance of certification program for a
year; and
(B) Successfully completes a qualified maintenance of certification
program practice assessment for such year.
(2) In order for an eligible professional to receive the additional
incentive payment, a Maintenance of Certification Program must submit to
the Secretary, on behalf of the eligible professional, information--
(i) In a form and manner specified by the Secretary, that the
eligible professional has successfully met the requirements of paragraph
(d)(1)(iii) of this section, which may be in the form of a structural
measure.
(ii) If requested by the Secretary, on the survey of patient
experience with care.
(iii) As the Secretary may require, on the methods, measures, and
data used under the Maintenance of Certification Program and the
qualified Maintenance of Certification Program practice assessment.
(e) Payment adjustments. For 2015 through 2018, with respect to
covered professional services furnished by an eligible professional, if
the eligible professional does not satisfactorily submit data on quality
measures for covered professional services for the quality reporting
period for the year (as determined under section 1848(m)(3)(A) of the
Act), the fee schedule amount for such services furnished by such
professional during the year (including the fee schedule amount for
purposes for determining a payment based on such amount) must be equal
to the applicable percent of the fee schedule amount that would
otherwise apply to such services under this paragraph (e).
(1) The applicable percent is as follows:
(i) For 2015, 98.5 percent.
(ii) For 2016 through 2018, 98 percent.
(2) The Secretary must treat an individual eligible professional, as
identified by a unique TIN/NPI combination, as satisfactorily submitting
data on quality measures (as determined under paragraph (h) of this
section), if the eligible professional is satisfactorily participating,
in a qualified clinical data registry.
(f) Use of appropriate and consensus-based quality measures. For
measures selected for inclusion in the PQRS quality measure set, CMS
will use group practice measures determined appropriate by CMS and
consensus-based quality measures that meet one of the following
criteria:
(1) Be such measures selected by the Secretary from measures that
have been endorsed by the entity with a contract with the Secretary
under section 1890(a) of the Act. In the case of a specified area or
medical topic determined appropriate by the Secretary for which a
feasible and practical measure has not been endorsed by the entity with
a contract under section 1890(a) of the Act, the Secretary may specify a
measure that is not so endorsed as long as due consideration is given to
measures that have been endorsed or adopted by a consensus organization
identified by the Secretary.
(2) For each quality measure adopted by the Secretary under this
paragraph, the Secretary ensures that eligible professionals have the
opportunity to provide input during the development, endorsement, or
selection of quality measures applicable to services they furnish.
(g) Use of quality measures for satisfactory participation in a
qualified clinical data registry. For measures selected for
[[Page 35]]
reporting to meet the criteria for satisfactory participation in a
qualified clinical data registry, CMS will use measures selected by
qualified clinical data registries based on parameters set by CMS.
(h) Satisfactory reporting requirements for the incentive payments.
In order to qualify to earn a PQRS incentive payment for a particular
program year, an individual eligible professional, as identified by a
unique TIN/NPI combination, must meet the criteria for satisfactory
reporting specified by CMS under paragraph (h)(3) of (h)(5) of this
section for such year by reporting on either individual PQRS quality
measures or PQRS measures groups identified by CMS during a reporting
period specified in paragraph (h)(1) of this section, using one of the
reporting mechanisms specified in paragraph (h)(2) or (4) of this
section, and using one of the reporting criteria specified in paragraph
(h)(3) or (5) of this section.
(1) Reporting periods. For purposes of this paragraph, the reporting
period is--
(i) The 12-month period from January 1 through December 31 of such
program year.
(ii) A 6-month period from July 1 through December 31 of such
program year.
(A) For 2011, such 6-month reporting period is not available for
EHR-based reporting of individual PQRS quality measures.
(B) For 2012 and subsequent program years, such 6-month reporting
period from July 1 through December 31 of such program year is only
available for registry-based reporting of PQRS measures groups by
eligible professionals.
(2) Reporting mechanisms for individual eligible professionals. An
individual eligible professional who wishes to participate in the PQRS
must report information on PQRS quality measures identified by CMS in
one of the following manners:
(i) Claims. Reporting PQRS quality measures or PQRS measures groups
to CMS, by no later than 2 months after the end of the applicable
reporting period, on the eligible professional's Medicare Part B claims
for covered professional services furnished during the applicable
reporting period.
(A) If an eligible professional re-submits a Medicare Part B claim
for reprocessing, the eligible professional may not attach a G-code at
that time for reporting on individual PQRS measures or measures groups.
(B) [Reserved]
(ii) Registry. Reporting PQRS quality measures or PQRS measures
groups to a qualified registry in the form and manner and by the
deadline specified by the qualified registry selected by the eligible
professional. The selected registry must submit information, as required
by CMS, for covered professional services furnished by the eligible
professional during the applicable reporting period to CMS on the
eligible professional's behalf.
(iii) Direct EHR product. Reporting PQRS quality measures to CMS by
extracting clinical data using a secure data submission method, as
required by CMS, from a direct EHR product by the deadline specified by
CMS for covered professional services furnished by the eligible
professional during the applicable reporting period.
(iv) EHR data submission vendor. Reporting PQRS quality measures to
CMS by extracting clinical data using a secure data submission method,
as required by CMS, from an EHR data submission vendor product by the
deadline specified by CMS for covered professional services furnished by
the eligible professional during the applicable reporting period.
(v) Although an eligible professional may attempt to qualify for the
PQRS incentive payment by reporting on both individual PQRS quality
measures and measures groups, using more than one reporting mechanism
(as specified in paragraph (g)(2) of this section), or reporting for
more than one reporting period, he or she will receive only one PQRS
incentive payment per TIN/NPI combination for a program year.
(3) Satisfactory reporting criteria for individual eligible
professionals for the 2014 PQRS incentive. An individual eligible
professional who wishes to qualify for the 2014 PQRS incentive must
report information on PQRS quality measures data in one of the following
manners:
[[Page 36]]
(i) Via Claims. For the 12-month 2014 PQRS incentive reporting
period--
(A) Report at least 9 measures covering at least 3 National Quality
Strategy domains, and report each measure for at least 50 percent of the
Medicare Part B FFS patients seen during the reporting period to which
the measure applies; or if less than 9 measures covering at least 3
National Quality Strategy domains apply to the eligible professional,
report 1 to 8 measures covering 1 to 3 National Quality Strategy domains
and report each measure for at least 50 percent of the Medicare Part B
FFS patients seen during the reporting period to which the measure
applies. For an eligible professional who reports fewer than 9 measures
covering at least 3 NQS domains via the claims-based reporting
mechanism, the eligible professional would be subject to the Measures
Applicability Validation process, which would allow us to determine
whether an eligible professional should have reported quality data codes
for additional measures and/or covering additional National Quality
Strategy domains. Measures with a 0 percent performance rate would not
be counted.
(B) [Reserved]
(ii) Via Qualified Registry. (A) For the 12-month 2014 PQRS
incentive reporting period--
(1) Report at least 9 measures covering at least 3 of the National
Quality Strategy domains report each measure for at least 50 percent of
the eligible professional's Medicare Part B FFS patients seen during the
reporting period to which the measure applies; or, if less than 9
measures covering at least 3 NQS domains apply to the eligible
professional, report 1 to 8 measures covering 1 to 3 National Quality
Strategy domains for which there is Medicare patient data and report
each measure for at least 50 percent of the eligible professional's
Medicare Part B FFS patients seen during the reporting period to which
the measure applies. For an eligible professional who reports fewer than
9 measures covering at least 3 NQS domains via the qualified registry-
based reporting mechanism, the eligible professional will be subject to
the Measures Applicability Validation process, which would allow us to
determine whether an eligible professional should have reported on
additional measures and/or measures covering additional National Quality
Strategy domains. Measures with a 0 percent performance rate would not
be counted.
(2) Report at least 1 measures group and report each measures group
for at least 20 patients, a majority of which much be Medicare Part B
FFS patients. Measures with a 0 percent performance rate or measures
groups containing a measure with a 0 percent performance rate will not
be counted.
(B) For the 6-month 2014 PQRS incentive reporting period, report at
least 1 measures group and report each measures group for at least 20
patients, a majority of which much be Medicare Part B FFS patients.
Measures groups containing a measure with a 0 percent performance rate
will not be counted.
(iii) Via EHR Direct Product. For the 12-month 2014 PQRS incentive
reporting period, report 9 measures covering at least 3 of the National
Quality Strategy domains. If an eligible professional's CEHRT does not
contain patient data for at least 9 measures covering at least 3
domains, then the eligible professional must report the measures for
which there is Medicare patient data. An eligible professional must
report on at least 1 measure for which there is Medicare patient data.
(iv) Via EHR Data Submission Vendor. For the 12-month 2014 PQRS
incentive reporting period, report 9 measures covering at least 3 of the
National Quality Strategy domains. If an eligible professional's CEHRT
does not contain patient data for at least 9 measures covering at least
3 domains, then the eligible professional must report the measures for
which there is Medicare patient data. An eligible professional must
report on at least 1 measure for which there is Medicare patient data.
(4) Reporting mechanisms for group practices. With the exception of
a group practice who wishes to participate in the PQRS using the
certified survey vendor mechanism (as specified in paragraph (h)(4)(v)
of this section), a group practice must report information on PQRS
quality measures identified by CMS in one of the following reporting
mechanisms:
[[Page 37]]
(i) Web interface. For 2013 and subsequent years, reporting PQRS
quality measures to CMS using a CMS web interface in the form and manner
and by the deadline specified by CMS.
(ii) Registry. For 2013 and subsequent years, reporting on PQRS
quality measures to a qualified registry in the form and manner and by
the deadline specified by the qualified registry selected by the
eligible professional. The selected registry must submit information, as
required by CMS, for covered professional services furnished by the
eligible professional during the applicable reporting period to CMS on
the eligible professional's behalf.
(iii) Direct EHR product. For 2014 and subsequent years, reporting
PQRS quality measures to CMS by extracting clinical data using a secure
data submission method, as required by CMS, from a direct EHR product by
the deadline specified by CMS for covered professional services
furnished by the eligible professional during the applicable reporting
period.
(iv) EHR data submission vendor. For 2014 and subsequent years,
reporting PQRS quality measures to CMS by extracting clinical data using
a secure data submission method, as required by CMS, from an EHR data
submission vendor product by the deadline specified by CMS for covered
professional services furnished by the eligible professional during the
applicable reporting period.
(v) Certified survey vendors. For 2014 and subsequent years,
reporting CAHPS for PQRS survey measures to CMS using a vendor that is
certified by CMS for a particular program year to transmit survey
measures data to CMS. Group practices that elect this reporting
mechanism must select an additional group practice reporting mechanism
in order to meet the criteria for satisfactory reporting for the
incentive payments.
(vi) Although a group practice may attempt to qualify for the PQRS
incentive payment by using more than one reporting mechanism (as
specified in paragraph (g)(3) of this section), or reporting for more
than one reporting period, the group practice will receive only one PQRS
incentive payment for a program year.
(5) Satisfactory reporting criteria for group practices for the 2014
PQRS incentive. A group practice who wishes to qualify for the 2014 PQRS
incentive must report information on PQRS quality measures identified by
CMS in one of the following manners:
(i) Via the GPRO web interface. (A) For the 12-month 2014 PQRS
incentive reporting period, for a group practice of 25 to 99 eligible
professionals, report on all measures included in the web interface and
populate data fields for the first 218 consecutively ranked and assigned
beneficiaries in the order in which they appear in the group's sample
for each module or preventive care measure. If the pool of eligible
assigned beneficiaries is less than 218, then report on 100 percent of
assigned beneficiaries.
(B) For the 12-month 2014 PQRS incentive reporting period, for a
group practice of 100 or more eligible professionals, report on all
measures included in the web interface and populate data fields for the
first 411 consecutively ranked and assigned beneficiaries in the order
in which they appear in the group's sample for each module or preventive
care measure. If the pool of eligible assigned beneficiaries is less
than 411, then report on 100 percent of assigned beneficiaries. In
addition, for the 12-month 2014 PQRS incentive reporting period, the
group practice must report all CAHPS for PQRS survey measures via a CMS-
certified survey vendor, and report at least 6 measures covering at
least 2 of the National Quality Strategy domains using a qualified
registry, direct EHR product, or EHR data submission vendor.
(ii) Via Qualified Registry. For the 12-month 2014 PQRS incentive
reporting period, for a group practice of 2 or more eligible
professionals, report at least 9 measures, covering at least 3 of the
National Quality Strategy domains and report each measure for at least
50 percent of the group practice's Medicare Part B FFS patients seen
during the reporting period to which the measure applies; or, if less
than 9 measures covering at least 3 NQS domains apply to the group
practice, then the
[[Page 38]]
group practice must report 1-8 measures for which there is Medicare
patient data and report each measure for at least 50 percent of the
group practice's Medicare Part B FFS patients seen during the reporting
period to which the measure applies. For a group practice who reports
fewer than 9 measures covering at least 3 NQS domains via the qualified
registry-based reporting mechanism, the group practice would be subject
to the Measures Applicability Validation process, which would allow us
to determine whether a group practice should have reported on additional
measures and/or measures covering additional National Quality Strategy
domains. Measures with a 0 percent performance rate would not be
counted.
(iii) Via EHR Direct Product. For the 12-month 2014 PQRS incentive
reporting period, for a group practice of 2 or more eligible
professionals, report 9 measures covering at least 3 of the National
Quality Strategy domains. If a group practice's CEHRT does not contain
patient data for at least 9 measures covering at least 3 domains, then
the group practice must report the measures for which there is Medicare
patient data. A group practice must report on at least 1 measure for
which there is Medicare patient data.
(iv) Via EHR Data Submission Vendor. For the 12-month 2014 PQRS
incentive reporting period, for a group practice of 2 or more eligible
professionals, report 9 measures covering at least 3 of the National
Quality Strategy domains. If a group practice's CEHRT does not contain
patient data for at least 9 measures covering at least 3 domains, then
the group practice must report the measures for which there is Medicare
patient data. A group practice must report on at least 1 measure for
which there is Medicare patient data.
(v) Via a Certified survey vendor, in addition to the GPRO web
interface, qualified registry, direct EHR product, or EHR data
submission vendor reporting mechanisms. For the 12-month 2014 PQRS
incentive reporting period, for a group practice of 25 or more eligible
professionals, report all CAHPS for PQRS survey measures via a CMS-
certified survey vendor, and report at least 6 measures covering at
least 2 of the National Quality Strategy domains using a qualified
registry, direct EHR product, EHR data submission vendor, or GPRO web
interface.
(i) Satisfactory participation requirements for the incentive
payments for individual eligible professionals. To qualify for the 2014
PQRS incentive using a qualified clinical data registry, an individual
eligible professional, as identified by a unique TIN/NPI combination,
must meet the criteria for satisfactory participation as specified under
paragraph (i)(3) of this section by reporting on quality measures
identified by a qualified clinical data registry during a reporting
period specified in paragraph (i)(1) of this section, and using the
reporting mechanism specified in paragraph (i)(2) of this section.
(1) Reporting period. For purposes of this paragraph, the reporting
period is the 12-month period from January 1 through December 31.
(2) Reporting Mechanism. An individual eligible professional who
wishes to meet the criteria for satisfactory participation in a
qualified clinical data registry must use a qualified clinical data
registry to report information on quality measures identified by the
qualified clinical data registry.
(3) Satisfactory participation criteria for individual eligible
professionals for the 2014 PQRS incentive. An individual eligible
professional who wishes to qualify for the 2014 PQRS incentive through
satisfactory participation in a qualified clinical data registry must
report information on quality measures identified by the qualified
clinical data registry in the following manner:
(i) For the 12-month 2014 PQRS incentive reporting period, report at
least 9 measures designated for reporting under a qualified clinical
data registry covering at least 3 of the National Quality Strategy
domains and report each measure for at least 50 percent of the eligible
professional's patients. Of the measures reported via a qualified
clinical data registry, the eligible professional must report on at
least 1 outcome measure.
(ii) [Reserved]
(j) Satisfactory reporting requirements for the payment adjustments.
In order to satisfy the requirements for the PQRS
[[Page 39]]
payment adjustment for a particular program year, an individual eligible
professional, as identified by a unique TIN/NPI combination, or a group
practice must meet the criteria for satisfactory reporting specified by
CMS for such year by reporting on either individual PQRS measures or
PQRS measures groups identified by CMS during a reporting period
specified in paragraph (j)(1) of this section, using one of the
reporting mechanisms specified in paragraph (j)(2) or (4) of this
section, and using one of the reporting criteria specified in section
(j)(3) or (5) of this section.
(1) For purposes of this paragraph (j), the reporting period for the
payment adjustment, with respect to a payment adjustment year, is the
12-month period from January 1 through December 31 that falls 2 years
prior to the year in which the payment adjustment is applied.
(i) For the 2015 and 2016 PQRS payment adjustments only, an
alternative 6-month reporting period, from July 1-December 31 that fall
2 years prior to the year in which the payment adjustment is applied, is
also available.
(ii) Secondary Reporting Period for the 2017 PQRS payment adjustment
for certain eligible professionals or group practices- Individual
eligible professionals or group practices, who bill under the TIN of an
ACO participant if the ACO failed to report data on behalf of such EPs
or group practices during the previously established reporting period
for the 2017 PQRS payment adjustment, may separately report during a
secondary reporting period for the 2017 PQRS payment adjustment. The
secondary reporting period for the 2017 PQRS payment adjustment for the
affected individual eligible professionals or group practices is January
1, 2016 through December 31, 2016.
(2) Reporting mechanisms for individual eligible professionals. An
individual eligible professional participating in the PQRS must report
information on PQRS quality measures identified by CMS in one of the
following manners:
(i) Claims. Reporting PQRS quality measures or PQRS measures groups
to CMS, by no later than 2 months after the end of the applicable
reporting period, on the eligible professional's Medicare Part B claims
for covered professional services furnished during the applicable
reporting period.
(A) If an eligible professional re-submits a Medicare Part B claim
for reprocessing, the eligible professional may not attach a G-code at
that time for reporting on individual PQRS measures or measures groups.
(B) [Reserved]
(ii) Registry. Reporting PQRS quality measures or PQRS measures
groups to a qualified registry in the form and manner and by the
deadline specified by the qualified registry selected by the eligible
professional. The selected registry must submit information, as required
by CMS, for covered professional services furnished by the eligible
professional during the applicable reporting period to CMS on the
eligible professional's behalf.
(iii) Direct EHR product. Reporting PQRS quality measures to CMS by
extracting clinical data using a secure data submission method, as
required by CMS, from a direct EHR product by the deadline specified by
CMS for covered professional services furnished by the eligible
professional during the applicable reporting period.
(iv) EHR data submission vendor. Reporting PQRS quality measures to
CMS by extracting clinical data using a secure data submission method,
as required by CMS, from an EHR data submission vendor product by the
deadline specified by CMS for covered professional services furnished by
the eligible professional during the applicable reporting period.
(v) Administrative claims. For 2015, reporting data on PQRS quality
measures via administrative claims during the applicable reporting
period. Eligible professionals that are administrative claims reporters
must meet the following requirement for the payment adjustment:
(A) Elect to participate in the PQRS using the administrative claims
reporting option.
(B) Reporting Medicare Part B claims data for CMS to determine
whether the eligible professional has performed services applicable to
certain individual PQRS quality measures.
[[Page 40]]
(3) Satisfactory reporting criteria for individual eligible
professionals for the 2016 PQRS payment adjustment. An individual
eligible professional who wishes to meet the criteria for satisfactory
reporting for the 2016 PQRS payment adjustment must report information
on PQRS quality measures identified by CMS in one of the following
manners:
(i) Via Claims. (A) For the 12-month 2016 PQRS payment adjustment
reporting period--
(1)(i) Report at least 9 measures covering at least 3 National
Quality Strategy domains and report each measure for at least 50 percent
of the Medicare Part B FFS patients seen during the reporting period to
which the measure applies; or if less than 9 measures covering at least
3 NQS domains apply to the eligible professional, report 1-8 measures
covering 1-3 National Quality Strategy domains, and report each measure
for at least 50 percent of the Medicare Part B FFS patients seen during
the reporting period to which the measure applies. For an eligible
professional who reports fewer than 9 measures covering at least 3 NQS
domains via the claims-based reporting mechanism, the eligible
professional would be subject to the Measures Applicability Validation
process, which would allow us to determine whether an eligible
professional should have reported quality data codes for additional
measures and/or covering additional National Quality Strategy domains;
or
(ii) Report at least 3 measures covering at least 1 NQS domain, or,
if less than 3 measures covering at least 1 NQS domain apply to the
eligible professional, report 1-2 measures covering at least 1 NQS
domain; and report each measure for at least 50 percent of the eligible
professional's Medicare Part B FFS patients seen during the reporting
period to which the measure applies.
(2) Measures with a 0 percent performance rate would not be counted.
(ii) Via Qualified Registry. (A) For the 12-month 2016 PQRS payment
adjustment reporting period--
(1)(i) Report at least 9 measures covering at least 3 of the
National Quality Strategy domains; or if less than 9 measures covering
at least 3 NQS domains apply to the eligible professional, report 1 to 8
measures covering 1 to 3 National Quality Strategy domains for which
there is Medicare patient data, and report each measure for at least 50
percent of the eligible professional's Medicare Part B FFS patients seen
during the reporting period to which the measure applies. For an
eligible professional who reports fewer than 9 measures covering at
least 3 NQS domains via the qualified registry-based reporting
mechanism, the eligible professional would be subject to the Measures
Applicability Validation process, which would allow us to determine
whether an eligible professional should have reported on additional
measures and/or measures covering additional National Quality Strategy
domains; or
(ii) Report at least 3 measures covering at least 1 of the NQS
domains; or if less than 3 measures covering at least 1 NQS domain apply
to the eligible professional, report 1 to 2 measures covering 1 National
Quality Strategy domain for which there is Medicare patient data, and
report each measure for at least 50 percent of the eligible
professional's Medicare Part B FFS patients seen during the reporting
period to which the measure applies. For an eligible professional who
reports fewer than 3 measures covering 1 NQS domain via the registry-
based reporting mechanism, the eligible professional would be subject to
the Measures Applicability Validation process, which would allow us to
determine whether an eligible professional should have reported on
additional measures; or
(iii) Report at least 1 measures group and report each measures
group for at least 20 patients, a majority of which much be Medicare
Part B FFS patients.
(2) Measures with a 0 percent performance rate or measures groups
containing a measure with a 0 percent performance rate will not be
counted.
(B) For the 6-month 2016 PQRS payment adjustment reporting period--
(1) Report at least 1 measures group and report each measures group
for at least 20 patients, a majority of which much be Medicare Part B
FFS patients. Measures groups containing a measure with a 0 percent
performance rate will not be counted.
[[Page 41]]
(iii) Via EHR Direct Product. For the 12-month 2016 PQRS payment
adjustment reporting period, report 9 measures covering at least 3 of
the National Quality Strategy domains. If an eligible professional's
CEHRT does not contain patient data for at least 9 measures covering at
least 3 domains, then the eligible professional must report the measures
for which there is Medicare patient data. An eligible professional must
report on at least 1 measure for which there is Medicare patient data.
(iv) Via EHR Data Submission Vendor. For the 12-month 2016 PQRS
payment adjustment reporting period, report 9 measures covering at least
3 of the National Quality Strategy domains. If an eligible
professional's CEHRT does not contain patient data for at least 9
measures covering at least 3 domains, then the eligible professional
must report the measures for which there is Medicare patient data. An
eligible professional must report on at least 1 measure for which there
is Medicare patient data.
(4) Satisfactory Reporting Criteria for Individual Eligible
Professionals for the 2017 PQRS Payment Adjustment. An individual
eligible professional who wishes to meet the criteria for satisfactory
reporting for the 2017 PQRS payment adjustment must report information
on PQRS quality measures identified by CMS in one of the following
manners:
(i) Via Claims. (A) For the 12-month 2017 PQRS payment adjustment
reporting period--
(1)(i) Report at least 9 measures, covering at least 3 of the NQS
domains and report each measure for at least 50 percent of the eligible
professional's Medicare Part B FFS patients seen during the reporting
period to which the measure applies. Of the 9 measures reported, if the
eligible professional sees at least 1 Medicare patient in a face-to-face
encounter, the eligible professional must report on at least 1 measure
contained in the cross-cutting measure set specified by CMS. If less
than 9 measures apply to the eligible professional, report up to 8
measures and report each measure for at least 50 percent of the Medicare
Part B FFS patients seen during the reporting period to which the
measure applies. Measures with a 0 percent performance rate would not be
counted.
(ii) [Reserved]
(ii) Via Qualified Registry. (A) For the 12-month 2017 PQRS payment
adjustment reporting period--
(1)(i) Report at least 9 measures, covering at least 3 of the NQS
domains and report each measure for at least 50 percent of the eligible
professional's Medicare Part B FFS patients seen during the reporting
period to which the measure applies. Of the 9 measures reported, if the
eligible professional sees at least 1 Medicare patient in a face-to-face
encounter, the eligible professional must report on at least 1 measure
contained in the cross-cutting measure set specified by CMS. If less
than 9 measures apply to the eligible professional, report up to 8
measures and report each measure for at least 50 percent of the Medicare
Part B FFS patients seen during the reporting period to which the
measure applies.
(ii) Report at least 1 measures group and report each measures group
for at least 20 patients, a majority of which much be Medicare Part B
FFS patients.
(2) Measures with a 0 percent performance rate or measures groups
containing a measure with a 0 percent performance rate will not be
counted.
(iii) Via EHR Direct Product. For the 12-month 2017 PQRS payment
adjustment reporting period, report 9 measures covering at least 3 of
the NQS domains. If an eligible professional's direct EHR product does
not contain patient data for at least 9 measures covering at least 3
domains, then the eligible professional must report the measures for
which there is Medicare patient data. An eligible professional must
report on at least 1 measure for which there is Medicare patient data.
(iv) Via EHR Data Submission Vendor. For the 12-month 2017 PQRS
payment adjustment reporting period, report 9 measures covering at least
3 of the NQS domains. If an eligible professional's EHR data submission
vendor product does not contain patient data for at least 9 measures
covering at least 3 domains, then the eligible professional must report
the measures for which there is Medicare patient data. An eligible
professional must report on
[[Page 42]]
at least 1 measure for which there is Medicare patient data.
(v) Paragraphs (j)(8)(ii), (iii), and (iv) of this section apply to
individuals reporting using the secondary reporting period established
under paragraph (j)(1)(ii) of this section for the 2017 PQRS payment
adjustment.
(5) Reporting mechanisms for group practices. With the exception of
a group practice who wishes to participate in the PQRS using the
certified survey vendor mechanism, a group practice participating in the
PQRS must report information on PQRS quality measures identified by CMS
in one of the following reporting mechanisms:
(i) Web interface. For the 2015 payment adjustment and subsequent
payment adjustments, reporting PQRS quality measures to CMS using a CMS
web interface in the form and manner and by the deadline specified by
CMS.
(ii) Registry. For the 2015 subsequent adjustment and subsequent
payment adjustments, reporting on PQRS quality measures to a qualified
registry in the form and manner and by the deadline specified by the
qualified registry selected by the eligible professional. The selected
registry will submit information, as required by CMS, for covered
professional services furnished by the eligible professional during the
applicable reporting period to CMS on the eligible professional's
behalf.
(iii) Direct EHR product. For the 2016 subsequent adjustment and
subsequent payment adjustments, reporting PQRS quality measures to CMS
by extracting clinical data using a secure data submission method, as
required by CMS, from a direct EHR product by the deadline specified by
CMS for covered professional services furnished by the eligible
professional during the applicable reporting period.
(iv) EHR data submission vendor. For the 2016 subsequent adjustment
and subsequent payment adjustments, reporting PQRS quality measures to
CMS by extracting clinical data using a secure data submission method,
as required by CMS, from an EHR data submission vendor product by the
deadline specified by CMS for covered professional services furnished by
the group practice during the applicable reporting period.
(v) Administrative claims. For 2015, reporting data on PQRS quality
measures via administrative claims during the applicable reporting
period. Group practices that are administrative claims reporters must
meet the following requirement for the payment adjustment:
(A) Elect to participate in the PQRS using the administrative claims
reporting option.
(B) Reporting Medicare Part B claims data for CMS to determine
whether the group practice has performed services applicable to certain
individual PQRS quality measures.
(vi) Certified Survey Vendors. For 2016 and subsequent years,
reporting CAHPS for PQRS survey measures to CMS using a vendor that is
certified by CMS for a particular program year to transmit survey
measures data to CMS. Group practices that elect this reporting
mechanism must select an additional group practice reporting mechanism
in order to meet the criteria for satisfactory reporting for the payment
adjustment.
(6) Satisfactory reporting criteria for group practices for the 2016
PQRS payment adjustment. A group practice who wishes to meet the
criteria for satisfactory reporting for the 2016 PQRS payment adjustment
must report information on PQRS quality measures identified by CMS in
one of the following manners:
(i) Via the GPRO web interface. (A) For the 12-month 2016 PQRS
payment adjustment reporting period, for a group practice of 25 to 99
eligible professionals, report on all measures included in the web
interface and populate data fields for the first 218 consecutively
ranked and assigned beneficiaries in the order in which they appear in
the group's sample for each module or preventive care measure. If the
pool of eligible assigned beneficiaries is less than 218, then report on
100 percent of assigned beneficiaries.
(B) For the 12-month 2016 PQRS payment adjustment reporting period,
for a group practice of 100 or more eligible professionals, report on
all measures
[[Page 43]]
included in the Web interface and populate data fields for the first 411
consecutively ranked and assigned beneficiaries in the order in which
they appear in the group's sample for each module or preventive care
measure. If the pool of eligible assigned beneficiaries is less than
411, then report on 100 percent of assigned beneficiaries. In addition,
the group practice must also report all CAHPS for PQRS survey measures
via certified survey vendor.
(ii) Via Qualified Registry. (A) For the 12-month 2016 PQRS payment
adjustment reporting period, for a group practice of 2 or more eligible
professionals--
(1) Report at least 9 measures, covering at least 3 of the National
Quality Strategy domains and report each measure for at least 50 percent
of the group practice's Medicare Part B FFS patients seen during the
reporting period to which the measure applies; or If less than 9
measures covering at least 3 NQS domains apply to the eligible
professional, then the group practices must report 1-8 measures for
which there is Medicare patient data and report each measure for at
least 50 percent of the group practice's Medicare Part B FFS patients
seen during the reporting period to which the measure applies. For a
group practice who reports fewer than 9 measures covering at least 3 NQS
domains via the registry-based reporting mechanism, the group practice
would be subject to the Measures Applicability Validation process, which
would allow us to determine whether a group practice should have
reported on additional measures. Measures with a 0 percent performance
rate would not be counted; or
(2) Report at least 3 measures, covering at least 1 of the National
Quality Strategy domains and report each measure for at least 50 percent
of the group practice's Medicare Part B FFS patients seen during the
reporting period to which the measure applies; or if less than 3
measures covering at least 1 NQS domain apply to the group practice,
then the group practice must report 1-2 measures for which there is
Medicare patient data and report each measure for at least 50 percent of
the group practice's Medicare Part B FFS patients seen during the
reporting period to which the measure applies. For a group practice who
reports fewer than 3 measures covering at least 1 NQS domain via the
registry-based reporting mechanism, the group practice would be subject
to the Measures Applicability Validation process, which would allow us
to determine whether a group practice should have reported on additional
measures. Measures with a 0 percent performance rate would not be
counted.
(iii) Via EHR Direct Product. For a group practice of 2 or more
eligible professionals, for the 12-month 2016 PQRS payment adjustment
reporting period, report 9 measures covering at least 3 of the National
Quality Strategy domains. If a group practice's CEHRT does not contain
patient data for at least 9 measures covering at least 3 domains, then
the group practice must report the measures for which there is Medicare
patient data. A group practice must report on at least 1 measure for
which there is Medicare patient data.
(iv) Via EHR Data Submission Vendor. For a group practice of 2 or
more eligible professionals, for the 12-month 2016 PQRS payment
adjustment reporting period, report 9 measures covering at least 3 of
the National Quality Strategy domains. If a group practice's CEHRT does
not contain patient data for at least 9 measures covering at least 3
domains, then the group practice must report the measures for which
there is Medicare patient data. A group practice must report on at least
1 measure for which there is Medicare patient data.
(v) Via a Certified survey vendor, in addition to the GPRO Web
interface, qualified registry, direct EHR product, or EHR data
submission vendor reporting mechanisms. For a group practice of 25 or
more eligible professionals, for the 12-month 2016 PQRS payment
adjustment reporting period, report all CAHPS for PQRS survey measures
via a CMS-certified survey vendor and report at least 6 measures
covering at least 2 of the National Quality Strategy domains using a
qualified registry, direct EHR product, EHR data submission vendor, or
GPRO Web interface.
[[Page 44]]
(7) Satisfactory reporting criteria for group practices for the 2017
PQRS payment adjustment. A group practice who wishes to meet the
criteria for satisfactory reporting for the 2017 PQRS payment adjustment
must report information on PQRS quality measures identified by CMS in
one of the following manners:
(i) Via the GPRO web interface. For the 12-month 2017 PQRS payment
adjustment reporting period, for a group practice of 25 to 99 eligible
professionals, report on all measures included in the web interface and
populate data fields for the first 248 consecutively ranked and assigned
beneficiaries in the order in which they appear in the group's sample
for each module or preventive care measure. If the pool of eligible
assigned beneficiaries is less than 248, then report on 100 percent of
assigned beneficiaries. A group practice must report on at least 1
measure for which there is Medicare patient data.
(ii) Via Qualified Registry. For a group practice of 2 to 99
eligible professionals, for the 12-month 2017 PQRS payment adjustment
reporting period, report at least 9 measures, covering at least 3 of the
NQS domains and report each measure for at least 50 percent of the group
practice's Medicare Part B FFS patients seen during the reporting period
to which the measure applies; or if less than 9 measures covering at
least 3 NQS domains apply to the eligible professional, then the group
practice must report up to 8 measures for which there is Medicare
patient data and report each measure for at least 50 percent of the
group practice's Medicare Part B FFS patients seen during the reporting
period to which the measure applies. Of the measures reported, if any
eligible professional in the group practice sees at least 1 Medicare
patient in a face-to-face encounter, the group practice must report on
at least 1 measure contained in the cross-cutting measure set specified
by CMS. Measures with a 0 percent performance rate would not be counted;
or
(iii) Via EHR Direct Product. For a group practice of 2 to 99
eligible professionals, for the 12-month 2017 PQRS payment adjustment
reporting period, report 9 measures covering at least 3 of the NQS
domains. If a group practice's direct EHR product does not contain
patient data for at least 9 measures covering at least 3 domains, then
the group practice must report the measures for which there is Medicare
patient data. A group practice must report on at least 1 measure for
which there is Medicare patient data.
(iv) Via EHR Data Submission Vendor. For a group practice of 2 to 99
eligible professionals, for the 12-month 2017 PQRS payment adjustment
reporting period, report 9 measures covering at least 3 of the NQS
domains. If a group practice's EHR data submission vendor product does
not contain patient data for at least 9 measures covering at least 3
domains, then the group practice must report the measures for which
there is Medicare patient data. A group practice must report on at least
1 measure for which there is Medicare patient data.
(v) Via a Certified Survey Vendor in addition to a Qualified
Registry. For a group practice of 2 or more eligible professionals, for
the 12-month 2017 PQRS payment adjustment reporting period, report all
CAHPS for PQRS survey measures via a CMS-certified survey vendor and
report at least 6 additional measures covering at least 2 of the NQS
domains using a qualified registry. If less than 6 measures apply to the
group practice, the group practice must report up to 5 measures. Of the
additional measures that must be reported in conjunction with reporting
the CAHPS for PQRS survey measures, if any eligible professional in the
group practice sees at least 1 Medicare patient in a face-to-face
encounter, the group practice must report on at least 1 measure in the
cross-cutting measure set specified by CMS.
(vi) Via a Certified Survey Vendor in addition a Direct EHR Product
or EHR Data Submission Vendor. For a group practice of 2 or more
eligible professionals, for the 12-month 2017 PQRS payment adjustment
reporting period, report all CAHPS for PQRS survey measures via a CMS-
certified survey vendor and report at least 6 additional measures,
outside of CAHPS for PQRS, covering at least 2 of the NQS domains using
the direct EHR product that is CEHRT or EHR data submission vendor
[[Page 45]]
product that is CEHRT. If less than 6 measures apply to the group
practice, the group practice must report up to 5 measures. Of the
additional measures that must be reported in conjunction with reporting
the CAHPS for PQRS survey measures, the group practice must report on at
least 1 measure for which there is Medicare patient data.
(vii) Via a Certified Survey Vendor in addition to the GPRO Web
interface. (A) For a group practice of 25 or more eligible
professionals, for the 12-month 2017 PQRS payment adjustment reporting
period, report all CAHPS for PQRS survey measures via a CMS-certified
survey vendor and report on all measures included in the GPRO web
interface; AND populate data fields for the first 248 consecutively
ranked and assigned beneficiaries in the order in which they appear in
the group's sample for each module or preventive care measure. If the
pool of eligible assigned beneficiaries is less than 248, then the group
practice would report on 100 percent of assigned beneficiaries. A group
practice must report on at least 1 measure for which there is Medicare
patient data.
(B) [Reserved]
(viii) Paragraphs (j)(9)(ii), (iii), and (iv) of this section apply
to group practices reporting using the secondary reporting period
established under paragraph (j)(1)(ii) of this section for the 2017 PQRS
payment adjustment.
(8) Satisfactory reporting criteria for individual eligible
professionals for the 2018 PQRS payment adjustment. An individual
eligible professional who wishes to meet the criteria for satisfactory
reporting for the 2018 PQRS payment adjustment must report information
on PQRS quality measures identified by CMS in one of the following
manners:
(i) Via claims. (A) For the 12-month 2018 PQRS payment adjustment
reporting period--
(1)(i) Report at least 6 measures and report each measure for at
least 50 percent of the eligible professional's Medicare Part B Fee-for-
Service patients seen during the reporting period to which the measure
applies. If less than 6 measures apply to the eligible professional, the
eligible professional must report on each measure that is applicable,
and report each measure for at least 50 percent of the Medicare Part B
Fee-for-Service patients seen during the reporting period to which the
measure applies. Measures with a 0 percent performance rate will not be
counted (unless they are inverse measures where a lower rate reflects
better performance).
(ii) [Reserved]
(2) [Reserved]
(B) [Reserved]
(ii) Via qualified registry. (A) For the 12-month 2018 PQRS payment
adjustment reporting period--
(1)(i) Report at least 6 measures and report each measure for at
least 50 percent of the eligible professional's Medicare Part B Fee-for-
Service patients seen during the reporting period to which the measure
applies. If less than 6 measures apply to the eligible professional, the
eligible professional must report on each measure that is applicable,
and report each measure for at least 50 percent of the Medicare Part B
Fee-for-Service patients seen during the reporting period to which the
measure applies.
(ii) Report at least 1 measures group and report each measures group
for at least 20 patients, a majority of which must be Medicare Part B
FFS patients.
(2) Measures with a 0 percent performance rate or measures groups
containing a measure with a 0 percent performance rate will not be
counted (unless they are inverse measures where a lower rate reflects
better performance).
(B) [Reserved]
(iii) Via EHR direct product. For the 12-month 2018 PQRS payment
adjustment reporting period, report 6 measures. If an eligible
professional's direct EHR product or EHR data submission vendor product
does not contain patient data for at least 6 measures, then the eligible
professional must report all of the measures for which there is Medicare
patient data. An eligible professional must report on at least 1 measure
for which there is Medicare patient data.
(iv) Via EHR data submission vendor. For the 12-month 2018 PQRS
payment adjustment reporting period, report at least 6 measures. If an
eligible professional's direct EHR product or EHR data submission vendor
product does not contain patient data for at least 6
[[Page 46]]
measures, then the eligible professional must report all of the measures
for which there is Medicare patient data. An eligible professional must
report on at least 1 measure for which there is Medicare patient data.
(9) Satisfactory reporting criteria for group practices for the 2018
PQRS payment adjustment. A group practice who wishes to meet the
criteria for satisfactory reporting for the 2018 PQRS payment adjustment
must report information on PQRS quality measures identified by CMS in
one of the following manners:
(i) Via the GPRO web interface. For the 12-month 2018 PQRS payment
adjustment reporting period, for a group practice of 25 or more eligible
professionals, report on all measures included in the web interface; AND
populate data fields for the first 248 consecutively ranked and assigned
beneficiaries in the order in which they appear in the group's sample
for each module or preventive care measure. If the pool of eligible
assigned beneficiaries is less than 248, then the group practice must
report on 100 percent of assigned beneficiaries. In some instances, the
sampling methodology will not be able to assign at least 248 patients on
which a group practice may report, particularly those group practices on
the smaller end of the range of 25-99 eligible professionals. If the
group practice is assigned less than 248 Medicare beneficiaries, then
the group practice must report on 100 percent of its assigned
beneficiaries. A group practice must report on at least 1 measure for
which there is Medicare patient data.
(ii) Via qualified registry. For a group practice of 2 or more
eligible professionals, for the 12-month 2018 PQRS payment adjustment
reporting period, report at least 6 measures and report each measure for
at least 50 percent of the group practice's Medicare Part B Fee-for-
Service patients seen during the reporting period to which the measure
applies. If less than 6 measures apply to the group practice, the group
practice must report on each measure that is applicable, and report each
measure for at least 50 percent of the Medicare Part B Fee-for-Service
patients seen during the reporting period to which the measure applies.
Measures with a 0 percent performance rate would not be counted (unless
they are inverse measures where a lower rate reflects better
performance).
(iii) Via EHR direct product. For a group practice of 2 or more
eligible professionals, for the 12-month 2018 PQRS payment adjustment
reporting period, report 6 measures. If the group practice's direct EHR
product or EHR data submission vendor product does not contain patient
data for at least 6 measures, then the group practice must report all of
the measures for which there is Medicare patient data. A group practice
must report on at least 1 measure for which there is Medicare patient
data.
(iv) Via EHR data submission vendor. For a group practice of 2 or
more eligible professionals, for the 12-month 2018 PQRS payment
adjustment reporting period, report 6 measures. If the group practice's
direct EHR product or EHR data submission vendor product does not
contain patient data for at least 6 measures, then the group practice
must report all of the measures for which there is Medicare patient
data. A group practice must report on at least 1 measure for which there
is Medicare patient data.
(v) Via a certified survey vendor in addition to a qualified
registry. For a group practice of 2 or more eligible professionals that
elects to report via a certified survey vendor in addition to a
qualified registry for the 12-month 2018 PQRS payment adjustment
reporting period, the group practice must have all CAHPS for PQRS survey
measures reported on its behalf via a CMS-certified survey vendor. In
addition, the group practice must report at least 3 additional measures
using the qualified registry and report each measure for at least 50
percent of the group practice's Medicare Part B Fee-for-Service patients
seen during the reporting period to which the measure applies. If less
than 3 measures apply to the group practice, the group practice must
report on each measure that is applicable, and report each measure for
at least 50 percent of the Medicare Part B Fee-for-Service patients seen
during the reporting period to which the
[[Page 47]]
measure applies. Measures with a 0 percent performance rate would not be
counted (unless they are inverse measures where a lower rate reflects
better performance).
(vi) Via a certified survey vendor in addition to a direct EHR
product or EHR data submission vendor. For a group practice of 2 or more
eligible professionals that elects to report via a certified survey
vendor in addition to a direct EHR product or EHR data submission vendor
for the 12-month 2018 PQRS payment adjustment reporting period, the
group practice must have all CAHPS for PQRS survey measures reported on
its behalf via a CMS-certified survey vendor. In addition, the group
practice must report at least 3 additional measures using the direct EHR
product or EHR data submission vendor product. If less than 3 measures
apply to the group practice, the group practice must report all of the
measures for which there is patient data. Of the additional 3 measures
that must be reported in conjunction with reporting the CAHPS for PQRS
survey measures, a group practice must report on at least 1 measure for
which there is Medicare patient data.
(vii) Via a certified survey vendor in addition to the GPRO web
interface. (A) For a group practice of 25 or more eligible
professionals, for the 12-month 2018 PQRS payment adjustment reporting
period, the group practice must have all CAHPS for PQRS survey measures
reported on its behalf via a CMS-certified survey vendor. In addition,
the group practice must report on all measures included in the GPRO web
interface; AND populate data fields for the first 248 consecutively
ranked and assigned beneficiaries in the order in which they appear in
the group's sample for each module or preventive care measure. If the
pool of eligible assigned beneficiaries is less than 248, then the group
practice must report on 100 percent of assigned beneficiaries. A group
practice will be required to report on at least 1 measure for which
there is Medicare patient data.
(B) [Reserved]
(viii) If the CAHPS for PQRS survey is applicable to the practice,
group practices comprised of 100 or more eligible professionals that
register to participate in the GPRO may administer the CAHPS for PQRS
survey, regardless of the GPRO reporting mechanism selected.
(k) Satisfactory participation requirements for the payment
adjustments for individual eligible professionals and group practices.
In order to satisfy the requirements for the PQRS payment adjustment for
a particular program year through participation in a qualified clinical
data registry, an individual eligible professional, as identified by a
unique TIN/NPI combination, or group practice must meet the criteria for
satisfactory participation as specified in paragraph (k)(3) of this
section for such year, by reporting on quality measures identified by a
qualified clinical data registry during a reporting period specified in
paragraph (k)(1) of this section, using the reporting mechanism
specified in paragraph (k)(2) of this section.
(1) Reporting period. For purposes of this paragraph, the reporting
period is--
(i) The 12-month period from January 1 through December 31 that
falls 2 years prior to the year in which the payment adjustment is
applied.
(ii) [Reserved]
(2) Reporting mechanism. An individual eligible professional or
group practice who wishes to meet the criteria for satisfactory
participation in a qualified clinical data registry must use the
qualified clinical data registry to report information on quality
measures identified by the qualified clinical data registry.
(3) Satisfactory participation criteria for individual eligible
professionals for the 2016 PQRS payment adjustment. Satisfactory
participation criteria for individual eligible professionals for the
2016 PQRS payment adjustment. An individual eligible professional who
wishes to meet the criteria for satisfactory participation in a
qualified clinical data registry for the 2016 PQRS payment adjustment
must report information on quality measures identified by the qualified
clinical data registry in one of the following manners:
(i) For the 12-month 2016 PQRS payment adjustment reporting period--
(A) Report at least 9 measures available for reporting under a
qualified clinical data registry covering at least
[[Page 48]]
3 of the National Quality Strategy domains and report each measure for
at least 50 percent of the eligible professional's patients; or
(B) Report at least 3 measures available for reporting under a
qualified clinical data registry covering at least 1 of the National
Quality Strategy domains and report each measure for at least 50 percent
of the eligible professional's patients.
(4) Satisfactory participation criteria for individual eligible
professionals for the 2017 PQRS payment adjustment. An individual
eligible professional who wishes to meet the criteria for satisfactory
participation in a QCDR for the 2017 PQRS payment adjustment must report
information on quality measures identified by the QCDR in one of the
following manner:
(i) For the 12-month 2017 PQRS payment adjustment reporting period,
report at least 9 measures available for reporting under a QCDR covering
at least 3 of the NQS domains, and report each measure for at least 50
percent of the eligible professional's patients. Of these measures,
report on at least 2 outcome measures, or, if 2 outcomes measures are
not available, report on at least 2 outcome measures and at least 1 of
the following types of measures--resource use, patient experience of
care, efficiency/appropriate use or patient safety.
(ii) Section 414.90(k)(5) applies to individuals and group practices
reporting using the secondary reporting period established under
paragraph (j)(1)(ii) of this section for the 2017 PQRS payment
adjustment.
(5) Satisfactory participation criteria for individual eligible
professionals and group practices for the 2018 PQRS payment adjustment.
An individual eligible professional or group practice who wishes to meet
the criteria for satisfactory participation in a QCDR for the 2018 PQRS
payment adjustment must report information on quality measures
identified by the QCDR in the following manner:
(i) Individual eligible professional. For the applicable 12-month
reporting period, report at least 6 measures available for reporting
under a QCDR and report each measure for at least 50 percent of the
eligible professional's patients seen during the reporting period to
which the measure applies. If less than 6 measures apply to the eligible
professional, the eligible professional must report on each measure that
is applicable, and report each measure for at least 50 percent of the
eligible professional's patients.
(ii) Group practices. For the applicable 12-month reporting period,
report at least 6 measures available for reporting under a QCDR and
report each measure for at least 50 percent of the group practice's
patients seen during the reporting period to which the measure applies.
If less than 6 measures apply to the group practice, the group practice
must report on each measure that is applicable, and report each measure
for at least 50 percent of the group practice's patients. If a group
practice reports the CAHPS for PQRS survey measures, apply reduced
criteria as follows: 3 measures, as applicable.
(l) Requirements for group practices. Under the PQRS, a group
practice must meet all of the following requirements:
(1) Meet the participation requirements specified by CMS for the
PQRS group practice reporting option.
(2) Report measures in the form and manner specified by CMS.
(3) Meet other requirements for satisfactory reporting specified by
CMS.
(4) Meet participation requirements.
(i) If an eligible professional, as identified by an individual NPI,
has reassigned his or her Medicare billing rights to a group practice
(as identified by the TIN) selected to participate in the PQRS group
practice reporting option for a program year, then for that program year
the eligible professional must participate in the PQRS via the group
practice reporting option.
(ii) If, for the program year, the eligible professional
participates in the PQRS as part of a group practice (as identified by
the TIN) that is not selected to participate in the PQRS group practice
reporting option for that program year, then the eligible professional
may individually participate and qualify for a PQRS incentive by meeting
the requirements specified in paragraph (g) of this section under that
TIN.
(m) Informal review. Eligible professionals or group practices may
seek an
[[Page 49]]
informal review of the determination that an eligible professional or
group practices did not satisfactorily submit data on quality measures
under the PQRS, or, for individual eligible professionals, in lieu of
satisfactory reporting, did not satisfactorily participate in a
qualified clinical data registry.
(1) To request an informal review for reporting periods that occur
prior to 2014, an eligible professional or group practice must submit a
request to CMS within 90 days of the release of the feedback reports. To
request an informal review for reporting periods that occur in 2014 and
subsequent years, an eligible professional or group practice must submit
a request to CMS within 60 days of the release of the feedback reports.
The request must be submitted in writing and summarize the concern(s)
and reasons for requesting an informal review and may also include
information to assist in the review.
(2) CMS will provide a written response within 90 days of the
receipt of the original request.
(i) All decisions based on the informal review will be final.
(ii) There will be no further review or appeal.
(3) If, during the informal review process, CMS finds errors in data
that was submitted by a third-party vendor on behalf of an eligible
professional or group practice using either the qualified registry, EHR
data submission vendor, or QCDR reporting mechanisms, CMS may allow for
the resubmission of data to correct these errors.
(i) CMS will not allow resubmission of data submitted via claims,
direct EHR, and the GPRO web interface reporting mechanisms.
(ii) CMS will only allow resubmission of data that was already
previously submitted to CMS.
(iii) CMS will only accept data that was previously submitted for
the reporting periods for which the corresponding informal review period
applies.
(n) Limitations on review. Except as specified in paragraph (i) of
this section, there is no administrative or judicial review under
section 1869 or 1879 of the Act, or otherwise of--
(1) The determination of measures applicable to services furnished
by eligible professionals under the PQRS;
(2) The determination of satisfactory reporting; and
(3) The determination of any Physician Quality Reporting System
incentive payment and the PQRS payment adjustment.
(o) Public reporting of an eligible professional's or group
practice's PQRS data. For each program year, CMS will post on a public
Web site, in an easily understandable format, a list of the names of
eligible professionals (or in the case of reporting under paragraph (g)
of this section, group practices) who satisfactorily submitted PQRS
quality measures.
[78 FR 74812, Dec. 10, 2013, as amended at 79 FR 68003, Nov. 13, 2014;
81 FR 34913, June 1, 2016; 81 FR 77537, Nov. 4, 2016; 81 FR 80554, Nov.
15, 2016; 82 FR 53362, Nov. 15, 2017]
Sec. 414.92 Electronic Prescribing Incentive Program.
(a) Basis and scope. This section implements the following
provisions of the Act:
(1) Section 1848(a)--Payment Based on Fee Schedule.
(2) Section 1848(m)--Incentive Payments for Quality Reporting.
(b) Definitions. As used in this section, unless otherwise
indicated--
Certified electronic health record technology means an electronic
health record vendor's product and version as described in 45 CFR
170.102.
Covered professional services means services for which payment is
made under, or is based on, the Medicare physician fee schedule which
are furnished by an eligible professional.
Electronic Prescribing Incentive Program means the incentive payment
program established under section 1848(m) of the Act for the adoption
and use of electronic prescribing technology by eligible professionals.
Eligible professional means any of the following healthcare
professionals who have prescribing authority:
(i) A physician.
(ii) A practitioner described in section 1842(b)(18)(C) of the Act.
(iii) A physical or occupational therapist or a qualified speech-
language pathologist.
[[Page 50]]
(iv) A qualified audiologist (as defined in section 1861(ll)(3)(B)
of the Act).
Group practice means a group practice that is--
(i)(A) Defined at Sec. 414.90(b), that is participating in the
Physician Quality Reporting System; or
(B) In a Medicare-approved demonstration project or other Medicare
program, under which Physician Quality Reporting System requirements and
incentives have been incorporated; and
(ii) Has indicated its desire to participate in the electronic
prescribing group practice option.
Qualified electronic health record product means an electronic
health record product and version that, with respect to a particular
program year, is designated by CMS as a qualified electronic health
record product for the purpose of the Physician Quality Reporting System
(as described in Sec. 414.90) and the product's vendor has indicated a
desire to have the product qualified for purposes of the product's users
to submit information related to the electronic prescribing measure.
Qualified registry means a medical registry or a Maintenance of
Certification Program operated by a specialty body of the American Board
of Medical Specialties that, with respect to a particular program year,
is designated by CMS as a qualified registry for the purpose of the
Physician Quality Reporting System (as described in Sec. 414.90) and
that has indicated its desire to be qualified to submit the electronic
prescribing measure on behalf of eligible professionals for the purposes
of the Electronic Prescribing Incentive Program.
(c) Incentive payments and payment adjustments. (1) Incentive
payments. Subject to paragraph (c)(3) of this section, with respect to
covered professional services furnished during a reporting period by an
eligible professional, if the eligible professional is a successful
electronic prescriber for such reporting period, in addition to the
amount otherwise paid under section 1848 of the Act, there also must be
paid to the eligible professional (or to an employer or facility in the
cases described in section 1842(b)(6)(A) of the Act) or, in the case of
a group practice under paragraph (e) of this section, to the group
practice, from the Federal Supplementary Medical Insurance Trust Fund
established under section 1841 of the Act an amount equal to the
applicable electronic prescribing percent (as specified in paragraph
(c)(1)(ii) of this section) of the eligible professional's (or, in the
case of a group practice under paragraph (e) of this section, the group
practice's) total estimated allowed charges for all covered professional
services furnished by the eligible professional (or, in the case of a
group practice under paragraph (e) of this section, by the group
practice) during the applicable reporting period.
(i) For purposes of paragraph (c)(1) of this section,
(A) The eligible professional's (or, in the case of a group practice
under paragraph (e) of this section, the group practice's) total
estimated allowed charges for covered professional services furnished
during a reporting period are determined based on claims processed in
the National Claims History (NCH) no later than 2 months after the end
of the applicable reporting period;
(B) In the case of an eligible professional who furnishes covered
professional services in more than one practice, incentive payments are
separately determined for each practice based on claims submitted for
the eligible professional for each practice;
(C) Incentive payments earned by an eligible professional (or in the
case of a group practice under paragraph (e) of this section, by a group
practice) for a particular program year will be paid as a single
consolidated payment to the TIN holder of record.
(ii) Applicable electronic prescribing percent. The applicable
electronic prescribing percent is as follows:
(A) For the 2011 and 2012 program years, 1.0 percent.
(B) For the 2013 program year, 0.5 percent.
(iii) Limitation with respect to electronic health record (EHR)
incentive payments. The provisions of this paragraph do not apply to an
eligible professional (or, in the case of a group practice under
paragraph (e) of this section, a group practice) if, for the electronic
[[Page 51]]
health record reporting period the eligible professional (or group
practice) receives an incentive payment under section 1848(o)(1)(A) of
the Act with respect to a certified electronic health record technology
(as defined in section 1848(o)(4) of the Act) that has the capability of
electronic prescribing.
(2) Payment adjustment. Subject to paragraphs (c)(1)(ii) and (c)(3)
of this section, with respect to covered professional services furnished
by an eligible professional during 2012, 2013, or 2014, if the eligible
professional (or in the case of a group practice under paragraph (e) of
this section, the group practice) is not a successful electronic
prescriber (as specified by CMS for purposes of the payment adjustment)
for an applicable reporting period (as specified by CMS) the fee
schedule amount for such services furnished by such professional (or
group practice) during the program year (including the fee schedule
amount for purposes of determining a payment based on such amount) is
equal to the applicable percent (as specified in paragraph (c)(2)(i) of
this section) of the fee schedule amount that would otherwise apply to
such services under section 1848 of the Act.
(i) Applicable percent. The applicable percent is as follows:
(A) For 2012, 99 percent;
(B) For 2013, 98.5 percent; and
(C) For 2014, 98 percent.
(ii) Significant hardship exception. CMS may, on a case-by-case
basis, exempt an eligible professional (or in the case of a group
practice under paragraph (e) of this section, a group practice) from the
application of the payment adjustment under paragraph (c)(2) of this
section if, CMS determines, subject to annual renewal, that compliance
with the requirement for being a successful electronic prescriber would
result in a significant hardship. Eligible professionals (or, in the
case of a group practice under paragraph (e) of this section, a group
practice) may request consideration for a significant hardship exemption
from a eRx payment adjustment if one of the following circumstances
apply:
(A) From the 2012 payment adjustments by meeting one of the
following:
(1) The practice is located in a rural area without high speed
internet access.
(2) The practice is located in an area without sufficient available
pharmacies for electronic prescribing.
(3) Registration to participate in the Medicare or Medicaid EHR
Incentive Program and adoption of Certified EHR Technology.
(4) Inability to electronically prescribe due to local, State or
Federal law or regulation.
(5) Eligible professionals who achieve meaningful use during the
respective 6 or 12-month payment adjustment reporting periods.
(6) Eligible professionals who have registered to participate in the
EHR Incentive Program and adopted Certified EHR Technology prior to
application of the respective payment adjustment.
(B) From the 2013 and 2014 payment adjustments by meeting one of the
following:
(1) The eligible professional or group practice is located in a
rural area without high speed internet access.
(2) The eligible professional or group practice is located in an
area without sufficient available pharmacies for electronic prescribing.
(3) The eligible professional or group practice is unable to
electronically prescribe due to local, State, or Federal law or
regulation.
(4) The eligible professional or group practice has limited
prescribing activity, as defined by an eligible professional generating
fewer than 100 prescriptions during a 6-month reporting period.
(iii) Other limitations to the payment adjustment. An eligible
professional (or in the case of a group practice under paragraph (b) of
this section, a group practice) is exempt from the application of the
payment adjustment under paragraph (c)(2) of this section if one of the
following applies:
(A) The eligible professional is not an MD, DO, podiatrist, nurse
practitioner, or physician assistant.
(B) The eligible professional does not have at least 100 cases
containing an encounter code that falls within the denominator of the
electronic prescribing measure for dates of service during the
[[Page 52]]
6-month reporting period specified in paragraph (f)(1) of this section.
(3) Limitation with respect to electronic prescribing quality
measures. The provisions of paragraphs (c)(1) and (c)(2) of this section
do not apply to an eligible professional (or, in the case of a group
practice under paragraph (e) of this section, a group practice) if for
the reporting period the allowed charges under section 1848 of the Act
for all covered professional services furnished by the eligible
professional (or group, as applicable) for the codes to which the
electronic prescribing measure applies are less than 10 percent of the
total of the allowed charges under section 1848 of the Act for all such
covered professional services furnished by the eligible professional (or
the group practice, as applicable).
(d) Requirements for individual eligible professionals to qualify to
receive an incentive payment. In order to be considered a successful
electronic prescriber and qualify to earn an electronic prescribing
incentive payment (subject to paragraph (c)(3) of this section), an
individual eligible professional, as identified by a unique TIN/NPI
combination, must meet the criteria for being a successful electronic
prescriber under section 1848(m)(3)(B) of the Act and as specified by
CMS during the reporting period specified in paragraph (d)(1) of this
section and using one of the reporting mechanisms specified in paragraph
(d)(2) of this section. Although an eligible professional may attempt to
qualify for the electronic prescribing incentive payment using more than
one reporting mechanism (as specified in paragraph (d)(2) of this
section), the eligible professional will receive only one electronic
prescribing incentive payment per TIN/NPI combination for a program
year.
(1) Reporting period. For purposes of this paragraph, the reporting
period with respect to a program year is the entire calendar year.
(2) Reporting mechanisms. An eligible professional who wishes to
participate in the Electronic Prescribing Incentive Program must report
information on the electronic prescribing measure identified by CMS to--
(i) CMS, by no later than 2 months after the end of the applicable
reporting period, on the eligible professional's Medicare Part B claims
for covered professional services furnished by the eligible professional
during the reporting period specified in paragraph (d)(1) of this
section;
(ii) A qualified registry (as defined in paragraph (b) of this
section) in the form and manner and by the deadline specified by the
qualified registry selected by the eligible professional. The selected
qualified registry will submit information, as required by CMS, for
covered professional services furnished by the eligible professional
during the reporting period specified in paragraph (d)(1) of this
section to CMS on the eligible professional's behalf; or
(iii) CMS by extracting clinical data using a secure data submission
method, as required by CMS, from a qualified electronic health record
product (as defined in paragraph (b) of this section) by the deadline
specified by CMS for covered professional services furnished by the
eligible professional during the reporting period specified in paragraph
(d)(1) of this section. Prior to actual data submission for a given
program year and by a date specified by CMS, the eligible professional
must submit a test file containing real or dummy clinical quality data
extracted from the qualified electronic health record product selected
by the eligible professional using a secure data submission method, as
required by CMS.
(e) Requirements for group practices to qualify to receive an
incentive payment. (1) A group practice (as defined in paragraph (b) of
this section) will be treated as a successful electronic prescriber for
covered professional services for a reporting period if the group
practice meets the criteria for successful electronic prescriber
specified by CMS in the form and manner and at the time specified by
CMS.
(2) No double payments. Payments to a group practice under this
paragraph must be in lieu of the payments that would otherwise be made
under the Electronic Prescribing Incentive Program to eligible
professionals in the group practice for being a successful electronic
prescriber.
(i) If an eligible professional, as identified by an individual NPI,
has reassigned his or her Medicare billing
[[Page 53]]
rights to a TIN selected to participate in the electronic prescribing
group practice reporting option for a program year, then for that
program year the eligible professional must participate in the
Electronic Prescribing Incentive Program via the group practice
reporting option. For any program year in which the TIN is selected to
participate in the Electronic Prescribing Incentive Program group
practice reporting option, the eligible professional cannot individually
qualify for an electronic prescribing incentive payment by meeting the
requirements specified in paragraph (d) of this section.
(ii) If, for the program year, the eligible professional
participates in the Electronic Prescribing Incentive Program under a TIN
that is not selected to participate in the Electronic Prescribing
Incentive Program group practice reporting option for that program year,
then the eligible professional may individually qualify for an
electronic prescribing incentive by meeting the requirements specified
in paragraph (d) of this section under that TIN.
(f) Requirements for individual eligible professionals and group
practices for the payment adjustment. In order to be considered a
successful electronic prescriber for the electronic prescribing payment
adjustment, an individual eligible professional (or, in the case of a
group practice under paragraph (b) of this section, a group practice),
as identified by a unique TIN/NPI combination, must meet the criteria
for being a successful electronic prescriber specified by CMS, in the
form and manner specified in paragraph (f)(2) of this section, and
during the reporting period specified in paragraph (f)(1) of this
section.
(1) Reporting periods. (i) For purposes of this paragraph (f), the
reporting period for the 2013 payment adjustment is either of the
following:
(A) The 12-month period from January 1, 2011 through December 31,
2011.
(B) The 6-month period from January 1, 2012 through June 30, 2012.
(ii) For purposes of this paragraph (f), the reporting period for
the 2014 payment adjustment is either of the following:
(A) The 12-month period from January 1, 2012 through December 31,
2012.
(B) The 6-month period from January 1, 2013 through June 30, 2013.
(2) Reporting mechanisms. An eligible professional (or, in the case
of a group practice under paragraph (e) of this section, a group
practice) who wishes to participate in the Electronic Prescribing
Incentive Program must report information on the electronic prescribing
measure identified by CMS to one of the following:
(i) For the 6- and 12-month reporting periods under paragraph (f)(1)
of this section, CMS, by no later than 2 months after the end of the
applicable 12-month reporting period or by no later than 1 month after
the end of the applicable 6-month reporting period, on the eligible
professional's Medicare Part B claims for covered professional services
furnished by the eligible professional during the reporting period
specified in paragraph (f)(1) of this section.
(A) If an eligible professional re-submits a Medicare Part B claim
for reprocessing, the eligible professional may not attach a G-code at
that time for reporting on the electronic prescribing measure.
(B) [Reserved]
(ii) For the 12-month reporting period under paragraph (f)(1) of
this section, a qualified registry (as defined in paragraph (b) of this
section) in the form and manner and by the deadline specified by the
qualified registry selected by the eligible professional. The selected
qualified registry submits information, as required by CMS, for covered
professional services furnished by the eligible professional during the
reporting period specified in paragraph (f)(1) of this section to CMS on
the eligible professional's behalf.
(iii) For the 12-month reporting period under paragraph (f)(1) of
this section, CMS by extracting clinical data using a secure data
submission method, as required by CMS, from a qualified electronic
health record product (as defined in paragraph (b) of this section) by
the deadline specified by CMS for covered professional services
furnished by the eligible professional during the reporting period
specified in paragraph (f)(1) of this section. Prior to actual
[[Page 54]]
data submission for a given program year and by a date specified by CMS,
the eligible professional must submit a test file containing dummy
clinical quality data extracted from the qualified electronic health
record product selected by the eligible professional using a secure data
submission method, as required by CMS.
(g) Informal review. Eligible professionals (or in the case of
reporting under paragraph (e) of this section, group practices) may seek
an informal review of the determination that an eligible professional
(or in the case of reporting under paragraph (e) of this section, group
practices) did not meet the requirements for the 2012 and 2013
incentives or the 2013 and 2014 payment adjustments.
(1) To request an informal review for the 2012 and 2013 incentives,
an eligible professional or group practice must submit a request to CMS
via email within 90 days of the release of the feedback reports. The
request must be submitted in writing and summarize the concern(s) and
reasons for requesting an informal review and may also include
information to assist in the review.
(2) To request an informal review for the 2013 and 2014 payment
adjustments, an eligible professional or group practices must submit a
request to CMS via email by February 28 of the year in which the
eligible professional is receiving the applicable payment adjustment.
The request must be submitted in writing and summarize the concern(s)
and reasons for requesting an informal review and may also include
information to assist in the review.
(3) CMS will provide a written response of CMS' determination.
(i) All decisions based on the informal review will be final.
(ii) There will be no further review or appeal.
(h) Public reporting of an eligible professional's or group
practice's Electronic Prescribing Incentive Program data. For each
program year, CMS will post on a public Web site, in an easily
understandable format, a list of the names of eligible professionals (or
in the case of reporting under paragraph (e) of this section, group
practices) who are successful electronic prescribers.
[75 FR 73620, Nov. 29, 2010, as amended at 76 FR 54968, Sept. 6, 2011;
76 FR 73472, Nov. 28, 2011; 77 FR 69368, Nov. 16, 2012; 80 FR 71379,
Nov. 16, 2015]
Sec. 414.94 Appropriate use criteria for advanced
diagnostic imaging services.
(a) Basis and scope. This section implements the following
provisions of the Act:
(1) Section 1834(q)--Recognizing Appropriate Use Criteria for
Certain Imaging Services.
(2) Section 1834(q)(1)--Program Established.
(3) Section 1834(q)(2)--Establishment of Applicable Appropriate Use
Criteria.
(b) Definitions. As used in this section unless otherwise
indicated--
Advanced diagnostic imaging service means an imaging service as
defined in section 1834(e)(1)(B) of the Act.
Applicable imaging service means an advanced diagnostic imaging
service (as defined in section 1834(e)(1)(B) of the Act) for which the
Secretary determines--
(i) One or more applicable appropriate use criteria apply;
(ii) There are one or more qualified clinical decision support
mechanisms listed; and
(iii) One or more of such mechanisms is available free of charge.
Applicable payment system means the following:
(i) The physician fee schedule established under section 1848(b) of
the Act;
(ii) The prospective payment system for hospital outpatient
department services under section 1833(t) of the Act; and
(iii) The ambulatory surgical center payment systems under section
1833(i) of the Act.
Applicable setting means a physician's office, a hospital outpatient
department (including an emergency department), an ambulatory surgical
center, an independent diagnostic testing facility, and any other
provider-led outpatient setting determined appropriate by the Secretary.
Appropriate use criteria (AUC) means criteria only developed or
endorsed by national professional medical specialty
[[Page 55]]
societies or other provider-led entities, to assist ordering
professionals and furnishing professionals in making the most
appropriate treatment decision for a specific clinical condition for an
individual. To the extent feasible, such criteria must be evidence-
based. An AUC set is a collection of individual appropriate use
criteria. An individual criterion is information presented in a manner
that links: a specific clinical condition or presentation; one or more
services; and, an assessment of the appropriateness of the service(s).
Clinical decision support mechanism (CDSM) means the following: an
interactive, electronic tool for use by clinicians that communicates AUC
information to the user and assists them in making the most appropriate
treatment decision for a patient's specific clinical condition. Tools
may be modules within or available through certified EHR technology (as
defined in section 1848(o)(4)) of the Act or private sector mechanisms
independent from certified EHR technology or established by the
Secretary.
Furnishing professional means a physician (as defined in section
1861(r) of the Act) or a practitioner described in section
1842(b)(18)(C) of the Act who furnishes an applicable imaging service.
Ordering professional means a physician (as defined in section
1861(r) of the Act) or a practitioner described in section
1842(b)(18)(C) of the Act who orders an applicable imaging service.
Priority clinical areas means clinical conditions, diseases or
symptom complexes and associated advanced diagnostic imaging services
identified by CMS through annual rulemaking and in consultation with
stakeholders which may be used in the determination of outlier ordering
professionals.
Provider-led entity (PLE) means a national professional medical
specialty society or other organization that is comprised primarily of
providers or practitioners who, either within the organization or
outside of the organization, predominantly provide direct patient care.
Specified applicable appropriate use criteria means any individual
appropriate use criterion or AUC set developed, modified or endorsed by
a qualified PLE.
(c) Qualified provider-led entity. To be qualified by CMS, a PLE
must adhere to the evidence-based processes described in paragraph
(c)(1) of this section when developing or modifying AUC. A qualified PLE
may develop AUC, modify AUC developed by another qualified PLE, or
endorse AUC developed by other qualified PLEs.
(1) Requirements for qualified PLEs developing or modifying AUC. A
PLE must perform all of the following when developing or modifying AUC:
(i) Utilize an evidentiary review process when developing or
modifying AUC that includes:
(A) A systematic literature review of the clinical topic and
relevant imaging studies; and
(B) An assessment of the evidence using a formal, published and
widely recognized methodology for grading evidence. Consideration of
relevant published consensus statements by professional medical
specialty societies must be part of the evidence assessment.
(ii) Utilize at least one multidisciplinary team with autonomous
governance, decision-making and accountability for developing or
modifying AUC. At a minimum the team must be comprised of seven members
including at least one practicing physician with expertise in the
clinical topic related to the appropriate use criterion being developed
or modified, at least one practicing physician with expertise in the
imaging studies related to the appropriate use criterion, at least one
primary care physician or practitioner as described in sections
1833(u)(6), 1833(x)(2)(A)(i)(I), and 1833(x)(2)(A)(i)(II) of the Act, at
least one expert in statistical analysis and at least one expert in
clinical trial design. A given team member may be the team's expert in
more than one domain.
(iii) Utilize a publicly transparent process for identifying
potential conflicts of interest and for resolving conflicts of interest
of members on the multidisciplinary team, the PLE and any other party
participating in AUC development or modification, to include recusal or
exclusion of individuals as appropriate. The PLE must document the
following information and make it available in timely fashion to
[[Page 56]]
a public request, for a period of not less than 5 years after the most
recent published update of the relevant AUC:
(A) Direct or indirect financial relationships that exist between
individuals or the spouse or minor child of individuals who have
substantively participated in the development of AUC and companies or
organizations including the PLE and any other party participating in AUC
development or modification that may financially benefit from the AUC.
These financial relationships may include, for example, compensation
arrangements such as salary, grant, speaking or consulting fees,
contract, or collaboration agreements.
(B) Ownership or investment interests between individuals or the
spouse or minor child of individuals who have substantively participated
in the development of AUC and companies or organizations including the
PLE or any other party participating in AUC development or modification
that may financially benefit from the AUC.
(iv) Publish each individual criterion on the PLE's Web site and
include an identifying title, authors (at a minimum, all members of the
multidisciplinary AUC development team must be listed as authors), and
key references used to establish the evidence.
(v) Identify each appropriate use criterion or AUC subset that are
relevant to a priority clinical area with a statement on the PLE's Web
site. To be identified as being relevant to a priority clinical area,
the criterion or AUC subset must reasonably address the entire clinical
scope of the corresponding priority clinical area.
(vi) Identify key points in an individual criterion as evidence-
based or consensus-based, and grade such key points in terms of strength
of evidence using a formal, published and widely recognized methodology.
(vii) Utilize a transparent process for the timely and continual
updating of each criterion. Each criterion must be reviewed and, when
appropriate, updated at least annually.
(viii) Publicly post the process for developing or modifying the AUC
on the PLE's Web site.
(ix) Disclose parties external to the PLE when such parties have
involvement in the AUC development process.
(2) Process to identify qualifying PLEs. PLEs must meet all of the
following criteria:
(i) PLEs must submit an application to CMS for review that documents
adherence to each of the AUC development requirements outlined in
paragraph (c)(1) of this section;
(ii) Applications will be accepted by CMS only from PLEs that meet
the definition of PLE in paragraph (b) of this section;
(iii) Applications must be received by CMS annually by January 1;
(iv) All approved qualified PLEs in each year will be included on
the list of qualified PLEs posted to the CMS Web site by June 30 of that
year; and
(v) Approved PLEs are qualified for a period of 5 years.
(vi) Qualified PLEs are required to re-apply. The application must
be received by CMS by January 1 of the 5th year after the PLE's most
recent approval date.
(d) Endorsement. Qualified PLEs may endorse the AUC set or
individual criteria of other qualified PLEs, under agreement by the
respective parties, in order to enhance an AUC set.
(e) Identifying priority clinical areas. (1) CMS identifies priority
clinical areas through annual rulemaking and in consultation with
stakeholders.
(2) CMS will consider incidence and prevalence of disease, the
volume and variability of use of particular imaging services, and
strength of evidence supporting particular imaging services. We will
also consider applicability of the clinical area to a variety of care
settings and to the Medicare population.
(3) The Medicare Evidence Development & Coverage Advisory Committee
(MEDCAC) may make recommendations to CMS.
(4) Priority clinical areas will be used by CMS to identify outlier
ordering professionals (section 1834(q)(5) of the Act).
(5) Priority clinical areas include the following:
(i) Coronary artery disease (suspected or diagnosed).
(ii) Suspected pulmonary embolism.
[[Page 57]]
(iii) Headache (traumatic and non-traumatic).
(iv) Hip pain.
(v) Low back pain.
(vi) Shoulder pain (to include suspected rotator cuff injury).
(vii) Cancer of the lung (primary or metastatic, suspected or
diagnosed).
(viii) Cervical or neck pain.
(f) Identification of non-evidence-based AUC or other non-adherence
to requirements for qualified PLEs. (1) CMS will accept public comment
to facilitate identification of AUC sets, subsets or individual
criterion that are not evidence-based, giving priority to AUC associated
with priority clinical areas and to AUC that conflict with one another.
CMS may also independently identify AUC of concern.
(2) The evidentiary basis of the identified AUC may be reviewed by
the MEDCAC.
(3) If a qualified PLE is found non-adherent to the requirements in
paragraph (c) of this section, CMS may terminate its qualified status or
may consider this information during re-qualification.
(g) Qualified clinical decision support mechanisms (CDSMs).
Qualified CDSMs are those specified as such by CMS. Qualified CDSMs must
adhere to the requirements described in paragraph (g)(1) of this
section.
(1) Requirements for qualification of CDSMs. A CDSM must meet all of
the following requirements:
(i) Make available specified applicable AUC and its related
supporting documentation.
(ii) Identify the appropriate use criterion consulted if the CDSM
makes available more than one criterion relevant to a consultation for a
patient's specific clinical scenario.
(iii) Make available, at a minimum, specified applicable AUC that
reasonably address common and important clinical scenarios within all
priority clinical areas identified in paragraph (e)(5) of this section.
(iv) Be able to incorporate specified applicable AUC from more than
one qualified PLE.
(v) Determines, for each consultation, the extent to which the
applicable imaging service is consistent with specified applicable AUC.
(vi) Generate and provide a certification or documentation at the
time of order that documents which qualified CDSM was consulted; the
name and national provider identifier (NPI) of the ordering professional
that consulted the CDSM; whether the service ordered would adhere to
specified applicable AUC; whether the service ordered would not adhere
to specified applicable AUC; or whether the specified applicable AUC
consulted was not applicable to the service ordered. Certification or
documentation must:
(A) Be generated each time an ordering professional consults a
qualified CDSM.
(B) Include a unique consultation identifier generated by the CDSM.
(vii) Modifications to AUC within the CDSM must comply with the
following timeline requirements:
(A) Make available updated AUC content within 12 months from the
date the qualified PLE updates AUC.
(B) A protocol must be in place to expeditiously remove AUC
determined by the qualified PLE to be potentially dangerous to patients
and/or harmful if followed.
(C) Specified applicable AUC that reasonably address common and
important clinical scenarios within any new priority clinical area must
be made available for consultation through the qualified CDSM within 12
months of the priority clinical area being finalized by CMS.
(viii) Meet privacy and security standards under applicable
provisions of law.
(ix) Provide to the ordering professional aggregate feedback
regarding their consultations with specified applicable AUC in the form
of an electronic report on at least an annual basis.
(x) Maintain electronic storage of clinical, administrative, and
demographic information of each unique consultation for a minimum of 6
years.
(xi) Comply with modification(s) to any requirements under paragraph
(g)(1) of this section made through rulemaking within 12 months of the
effective date of the modification.
(xii) Notify ordering professionals upon de-qualification.
[[Page 58]]
(2) Process to specify qualified CDSMs. (i) The CDSM developer must
submit an application to CMS for review that documents adherence to each
of the CDSM requirements outlined in paragraph (g)(1) of this section;
(ii) Receipt of applications. (A) Applications must be received by
CMS annually by January 1 (except as stated in paragraph (g)(2)(ii)(B)
of this section).
(B) For CDSM applicants seeking qualification in CY 2017,
applications must be submitted by March 1, 2017; and
(1) Applications that document current adherence to qualified CDSM
requirements will receive full qualification.
(2) Applications that do not document current adherence to each
qualified CDSM requirement, but that document how and when each
requirement is reasonably expected to be met, will receive preliminary
qualification.
(3) A preliminary qualification period begins under paragraph (2) on
June 30, 2017 and ends on the effective date of the requirements under
sections 1834(q)(4)(A) and 1834(q)(4)(B) of the Act.
(4) A CDSM with preliminary qualification will become fully
qualified by the end of the preliminary qualification period, or earlier
if CMS determines that the CDSM has demonstrated adherence to each
qualified CDSM requirement, unless we determine that the CDSM fails to
meet all requirements (including those requirements they expected to
meet in paragraph (g)(2)(ii)(B)(2) of this section) by the end of the
preliminary qualification period.
(iii) All qualified CDSMs specified by CMS in each year will be
included on the list of specified qualified CDSMs posted to the CMS Web
site by June 30 of that year; and
(iv) Qualified CDSMs are specified by CMS as such for a period of 5
years.
(v) Qualified CDSMs are required to re-apply during the fifth year
after they are specified by CMS in order to maintain their status as
qualified CDSMs. This application must be received by CMS by January 1
of the 5th year after the most recent approval date.
(h) Identification of non-adherence to requirements for qualified
CDSMs. (1) If a qualified CDSM is found non-adherent to the requirements
in paragraph (g)(1) of this section, CMS may terminate its qualified
status or may consider this information during requalification.
(i) Exceptions. Consulting and reporting requirements are not
required for orders for applicable imaging services made by ordering
professionals under the following circumstances:
(1) Emergency services when provided to individuals with emergency
medical conditions as defined in section 1867(e)(1) of the Act.
(2) For an inpatient and for which payment is made under Medicare
Part A.
(3) Significant hardships for ordering professionals who experience
any of the following:
(i) Insufficient internet access.
(ii) EHR or CDSM vendor issues.
(iii) Extreme and uncontrollable circumstances.
(j) Consulting. (1) Except as specified in paragraphs (i) and (j)(2)
of this section, ordering professionals must consult specified
applicable AUC through qualified CDSMs for applicable imaging services
furnished in an applicable setting, paid for under an applicable payment
system, and ordered on or after January 1, 2020.
(2) Ordering professionals may delegate the consultation with
specified applicable AUC required under paragraph (j)(1) of this section
to clinical staff acting under the direction of the ordering
professional.
(k) Reporting. The following information must be reported on
Medicare claims for advanced diagnostic imaging services furnished in an
applicable setting, paid for under an applicable payment system defined
in paragraph (b) of this section, and ordered on or after January 1,
2020:
(1) The qualified CDSM consulted by the ordering professional.
(2) Information indicating:
(i) Whether the service ordered would adhere to specified applicable
AUC;
(ii) Whether the service ordered would not adhere to specified
applicable AUC; or
[[Page 59]]
(iii) Whether the specified applicable AUC consulted was not
applicable to the service ordered.
(3) The NPI of the ordering professional who consulted specified
applicable AUC as required in paragraph (j) of this section, if
different from the furnishing professional.
[80 FR 71380, Nov. 16, 2015, as amended at 80 FR 80554, Nov. 15, 2016;
82 FR 53363, Nov. 15, 2017; 83 FR 60074, Nov. 23, 2018]
Subpart C_Fee Schedules for Parenteral and Enteral Nutrition (PEN)
Nutrients, Equipment and Supplies, Splints, Casts, and Certain
Intraocular Lenses (IOLs)
Source: 66 FR 45176, Aug. 28, 2001, unless otherwise noted.
Sec. 414.100 Purpose.
This subpart implements fee schedules for PEN items and services,
splints and casts, and IOLs inserted in a physician's office as
authorized by section 1842(s) of the Act.
[78 FR 72252, Dec. 2, 2013]
Sec. 414.102 General payment rules.
(a) General rule. For PEN items and services furnished on or after
January 1, 2002, and for splints and casts and IOLs inserted in a
physician's office on or after April 1, 2014, Medicare pays for the
items and services as described in paragraph (b) of this section on the
basis of 80 percent of the lesser of---
(1) The actual charge for the item or service; or
(2) The fee schedule amount for the item or service, as determined
in accordance with Sec. Sec. 414.104 thru 414.108.
(b) Payment classification. (1) CMS or the carrier determines fee
schedules for parenteral and enteral nutrition (PEN) nutrients,
equipment, and supplies, splints and casts, and IOLs inserted in a
physician's office, as specified in Sec. Sec. 414.104 thru 414.108.
(2) CMS designates the specific items and services in each category
through program instructions.
(c) Updating the fee schedule amounts. For the years 2003 through
2010 for PEN items and services, the fee schedule amounts of the
preceding year are updated by the percentage increase in the CPI-U for
the 12-month period ending with June of the preceding year. For each
year subsequent to 2010 for PEN items and services and for each year
subsequent to 2014 for splints and casts, and IOLs inserted in a
physician's office, the fee schedule amounts of the preceding year are
updated by the percentage increase in the CPI-U for the 12-month period
ending with June of the preceding year, reduced by the productivity
adjustment described in section 1886(b)(3)(B)(xi)(II) of the Act.
[66 FR 45176, Aug. 28, 2001, as amended at 78 FR 72252, Dec. 2, 2013]
Sec. 414.104 PEN Items and Services.
(a) Payment rules. Payment for PEN items and services is made in a
lump sum for nutrients and supplies that are purchased and on a monthly
basis for equipment that is rented.
(b) Fee schedule amount. The fee schedule amount for payment for an
item or service furnished in 2002 is the lesser of--
(i) The reasonable charge from 1995; or
(ii) The reasonable charge that would have been used in determining
payment for 2002.
Sec. 414.105 Application of competitive bidding information.
For enteral nutrients, equipment and supplies furnished on or after
January 1, 2011, the fee schedule amounts may be adjusted based on
information on the payment determined as part of implementation of the
programs under subpart F using the methodologies set forth at Sec.
414.210(g).
[79 FR 66262, Nov. 6, 2014]
Sec. 414.106 Splints and casts.
(a) Payment rules. Payment is made in a lump sum for splints and
casts.
(b) Fee schedule amount. The fee schedule amount for payment for an
item or service furnished in 2014 is the reasonable charge amount for
2013, updated by the percentage increase in the CPI-U for the 12-month
period ending with June of 2013.
[78 FR 72253, Dec. 2, 2013]
[[Page 60]]
Sec. 414.108 IOLs inserted in a physician's office.
(a) Payment rules. Payment is made in a lump sum for IOLs inserted
in a physician's office.
(b) Fee schedule amount. The fee schedule amount for payment for an
IOL furnished in 2014 is the national average allowed charge for the IOL
furnished from in calendar year 2012, updated by the percentage increase
in the CPI-U for the 24-month period ending with June of 2013.
[78 FR 72253, Dec. 2, 2013]
Subpart D_Payment for Durable Medical Equipment and Prosthetic and
Orthotic Devices
Sec. 414.200 Purpose.
This subpart implements sections 1834(a), (h) and (i) of the Act by
specifying how payments are made for the purchase or rental of new and
used durable medical equipment, prosthetic and orthotic devices, and
surgical dressings for Medicare beneficiaries.
[78 FR 72253, Dec. 2, 2013]
Sec. 414.202 Definitions.
For purposes of this subpart, the following definitions apply:
Complex rehabilitative power-driven wheelchair means a power-driven
wheelchair that is classified as--
(1) Group 2 power wheelchair with power options that can accommodate
rehabilitative features (for example, tilt in space); or
(2) Group 3 power wheelchair.
Covered item update means the percentage increase in the consumer
price index for all urban consumers (U.S. city average) (CPI-U) for the
12-month period ending with June of the previous year.
Durable medical equipment means equipment, furnished by a supplier
or a home health agency that meets the following conditions:
(1) Can withstand repeated use.
(2) Effective with respect to items classified as DME after January
1, 2012, has an expected life of at least 3 years.
(3) Is primarily and customarily used to serve a medical purpose.
(4) Generally is not useful to an individual in the absence of an
illness or injury.
(5) Is appropriate for use in the home.
Prosthetic and orthotic devices means--
(1) Devices that replace all or part of an internal body organ,
including ostomy bags and supplies directly related to ostomy care, and
replacement of such devices and supplies;
(2) One pair of conventional eyeglasses or contact lenses furnished
subsequent to each cataract surgery with insertion of an intraocular
lens; and
(3) Leg, arm, back, and neck braces, and artificial legs, arms, and
eyes, including replacements if required because of a change in the
beneficiary's physical condition.
The following are neither prosthetic nor orthotic devices--
(1) Parenteral and enteral nutrients, supplies, and equipment;
(2) Intraocular lenses;
(3) Medical supplies such as catheters, catheter supplies, ostomy
bags, and supplies related to ostomy care that are furnished by an HHA
as part of home health services under Sec. 409.40(e) of this chapter;
(4) Dental prostheses.
Region means, for the purpose of implementing Sec. 414.210(g),
geographic areas defined by the Bureau of Economic Analysis in the
United States Department of Commerce for economic analysis purposes,
and, for the purpose of implementing Sec. 414.228, those contractor
service areas administered by CMS regional offices.
Rural area means, for the purpose of implementing Sec. 414.210(g),
a geographic area represented by a postal zip code if at least 50
percent of the total geographic area of the area included in the zip
code is estimated to be outside any metropolitan area (MSA). A rural
area also includes a geographic area represented by a postal zip code
that is a low population density area excluded from a competitive
bidding area in accordance with the authority provided by section
1847(a)(3)(A) of the Act at the time the rules at Sec. 414.210(g) are
applied.
[57 FR 57689, Dec. 7, 1992, as amended at 75 FR 73622, Nov. 29, 2010; 76
FR 70314, Nov. 10, 2011; 79 FR 66262, Nov. 6, 2014]
[[Page 61]]
Sec. 414.210 General payment rules.
(a) General rule. For items furnished on or after January 1, 1989,
except as provided in paragraphs (c), (d), and (g) of this section,
Medicare pays for durable medical equipment, prosthetics and orthotics,
including a separate payment for maintenance and servicing of the items
as described in paragraph (e) of this section, on the basis of 80
percent of the lesser of--
(1) The actual charge for the item;
(2) The fee schedule amount for the item, as determined in
accordance with the provisions of Sec. Sec. 414.220 through 414.232
(b) Payment classification. (1) The carrier determines fee schedules
for the following classes of equipment and devices:
(i) Inexpensive or routinely purchased items, as specified in Sec.
414.220.
(ii) Items requiring frequent and substantial servicing, as
specified in Sec. 414.222.
(iii) Certain customized items, as specified in Sec. 414.224.
(iv) Oxygen and oxygen equipment, as specified in Sec. 414.226.
(v) Prosthetic and orthotic devices, as specified in Sec. 414.228.
(vi) Other durable medical equipment (capped rental items), as
specified in Sec. 414.229.
(vii) Transcutaneous electrical nerve stimulators (TENS), as
specified in Sec. 414.232.
(2) CMS designates the items in each class of equipment or device
through its program instructions.
(c) Exception for certain HHAs. Public HHAs and HHAs that furnish
services or items free-of-charge or at nominal prices to a significant
number of low-income patients, as defined in Sec. 413.13(a) of this
chapter, are paid on the basis of 80 percent of the fee schedule amount
determined in accordance with the provision of Sec. Sec. 414.220
through 414.230.
(d) Prohibition on special limits. For items furnished on or after
January 1, 1989 and before January 1, 1991, neither CMS nor a carrier
may establish a special reasonable charge for items covered under this
subpart on the basis of inherent reasonableness as described in Sec.
405.502(g) of this chapter.
(e) Maintenance and servicing--(1) General rule. Except as provided
in paragraph (e)(3) of this section, the carrier pays the reasonable and
necessary charges for maintenance and servicing of beneficiary-owned
equipment. Reasonable and necessary charges are those made for parts and
labor not otherwise covered under a manufacturer's or supplier's
warranty. Payment is made for replacement parts in a lump sum based on
the carrier's consideration of the item. The carrier establishes a
reasonable fee for labor associated with repairing, maintaining, and
servicing the item. Payment is not made for maintenance and servicing of
a rented item other than the maintenance and servicing fee for oxygen
equipment described in paragraph (e)(2) of this section or for other
durable medical equipment as described in Sec. 414.229(e).
(2) Maintenance and servicing payment for certain oxygen equipment
furnished after the 36-month rental period from January 1, 2009 through
June 30, 2010. The carrier makes a maintenance and servicing payment for
oxygen equipment other than liquid and gaseous equipment (stationary and
portable) as follows:
(i) For the first 6-month period following the date on which the 36-
month rental period ends in accordance with Sec. 414.226(a)(1) of this
subpart, no payments are made.
(ii) For each succeeding 6-month period, payment may be made during
the first month of that period for 30 minutes of labor for routine
maintenance and servicing of the equipment in the beneficiary's home
(including an institution used as the beneficiary's home).
(iii) The supplier must visit the beneficiary's home (including an
institution used as the beneficiary's home) to inspect the equipment
during the first month of the 6-month period.
(3) Exception to maintenance and servicing payments. For items
purchased on or after June 1, 1989, no payment is made under the
provisions of paragraph (e)(1) of this section for the maintenance and
servicing of:
(i) Items requiring frequent and substantial servicing, as defined
in Sec. 414.222(a);
(ii) Capped rental items, as defined in Sec. 414.229(a), that are
not beneficiary-
[[Page 62]]
owned in accordance with Sec. 414.229(d), Sec. 414.229(f)(2), or Sec.
414.229(h); and
(iii) Capped rental items, as defined in Sec. 414.229(a), that are
not beneficiary-owned in Sec. 414.229(d), Sec. 414.229(f)(2), or Sec.
414.229(h); and
(iv) Oxygen equipment, as described in Sec. 414.226.
(4) Supplier replacement of beneficiary-owned equipment based on
accumulated repair costs. A supplier that transfers title to a capped
rental item to a beneficiary in accordance with Sec. 414.229(f)(2) is
responsible for furnishing replacement equipment at no cost to the
beneficiary or to the Medicare program if the carrier determines that
the item furnished by the supplier will not last for the entire
reasonable useful lifetime established for the equipment in accordance
with Sec. 414.210(f)(1). In making this determination, the carrier may
consider whether the accumulated costs of repair exceed 60 percent of
the cost to replace the item.
(5) Maintenance and servicing payment for certain oxygen equipment
furnished after the 36-month rental period and on or after July 1, 2010.
For oxygen equipment other than liquid and gaseous equipment (stationary
and portable), the carrier makes payment as follows:
(i) For the first 6-month period following the date on which the 36-
month rental period ends in accordance with Sec. 414.226(a)(1) of this
subpart, no payments are made.
(ii) For each succeeding 6-month period, payment may be made during
the first month of that period for routine maintenance and servicing of
the equipment in the beneficiary's home (including an institution used
as the beneficiary's home).
(iii) Payment for maintenance and servicing is made based on a
reasonable fee not to exceed 10 percent of the purchase price for a
stationary oxygen concentrator. This payment includes payment for
maintenance and servicing of all oxygen equipment other than liquid or
gaseous equipment (stationary or portable).
(iv) The supplier must visit the beneficiary's home (including an
institution used as the beneficiary's home) to inspect the equipment
during the first month of the 6-month period.
(f) Payment for replacement of equipment. If an item of DME or a
prosthetic or orthotic device paid for under this subpart has been in
continuous use by the patient for the equipment's reasonable useful
lifetime or if the carrier determines that the item is lost, stolen, or
irreparably damaged, the patient may elect to obtain a new piece of
equipment.
(1) The reasonable useful lifetime of DME or prosthetic and orthotic
devices is determined through program instructions. In the absence of
program instructions, carriers may determine the reasonable useful
lifetime of equipment but in no case can it be less than 5 years.
Computation is based on when the equipment is delivered to the
beneficiary, not the age of the equipment.
(2) If the beneficiary elects to obtain replacement oxygen
equipment, payment is made in accordance with Sec. 414.226(a).
(3) If the beneficiary elects to obtain a replacement capped rental
item, payment is made in accordance with Sec. 414.229(a)(2) or (a)(3).
(4) For all other beneficiary-owned items, if the beneficiary elects
to obtain replacement equipment, payment is made on a purchase basis.
(g) Application of Competitive Bidding Information and Limitation of
Inherent Reasonableness Authority. For items furnished on or after
January 1, 2011, the fee schedule amounts may be adjusted, and for DME
items furnished on or after January 1, 2016, the fee schedule amounts
shall be adjusted, based on information on the payment determined as
part of implementation of the programs under subpart F, of this part,
excluding information on the payment determined in accordance with the
special payment rules at Sec. 414.409. In the case of such adjustments,
the rules at Sec. 405.502(g) and (h) of this chapter shall not be
applied. The methodologies for adjusting fee schedule amounts are
provided below. In any case where application of these methodologies
results in an increase in the fee schedule amount, the adjustment to the
fee schedule amount is not made.
(1) Payment adjustments for areas within the contiguous United
States using information from competitive bidding programs. For an item
or service subject to
[[Page 63]]
the programs under subpart F of this part, the fee schedule amounts for
such item or service for areas within the contiguous United States shall
be adjusted as follows:
(i) CMS determines a regional price for each state in the contiguous
United States and the District of Columbia equal to the un-weighted
average of the single payment amounts for an item or service established
in accordance with Sec. 414.416 for competitive bidding areas that are
fully or partially located in the same region that contains the state or
District of Columbia.
(ii) CMS determines a national average price equal to the un-
weighted average of the regional prices determined under paragraph
(g)(1)(i) of this section.
(iii) A regional price determined under paragraph (g)(1)(i) of this
section cannot be greater than 110 percent of the national average price
determined under paragraph (g)(1)(ii) of this section nor less than 90
percent of the national average price determined under paragraph
(g)(1)(ii) of this section.
(iv) The fee schedule amount for all areas within a state that are
not defined as rural areas for purposes of this subpart is adjusted to
the regional price determined under paragraphs (g)(1)(i) and (iii) of
this section.
(v) The fee schedule amount for all areas within a state that are
defined as rural areas for the purposes of this subpart is adjusted to
110 percent of the national average price determined under paragraph
(g)(1)(ii) of this section.
(2) Payment adjustments for areas outside the contiguous United
States using information from competitive bidding programs. For an item
or service subject to the programs under subpart F, the fee schedule
amounts for areas outside the contiguous United States are reduced to
the greater of--
(i) The average of the single payment amounts for the item or
service for CBAs outside the contiguous United States.
(ii) 110 percent of the national average price for the item or
service determined under paragraph (g)(1)(ii) of this section.
(3) Payment adjustments for items and services included in no more
than ten competitive bidding programs. Notwithstanding paragraph (g)(1)
of this section, for an item or service that is included in ten or fewer
competitive bidding programs as defined at Sec. 414.402, the fee
schedule amounts applied for all areas within and outside the contiguous
United States are reduced to 110 percent of the un-weighted average of
the single payment amounts from the ten or fewer competitive bidding
programs for the item or service in the areas where the ten or fewer
competitive bidding programs are in place.
(4) Payment adjustments using data on items and services included in
competitive bidding programs no longer in effect. In the case where
adjustments to fee schedule amounts are made using any of the
methodologies described, other than paragraph (g)(10) of this section,
if the adjustments are based solely on single payment amounts from
competitive bidding programs that are no longer in effect, the single
payment amounts are updated before being used to adjust the fee schedule
amounts. The single payment amounts are updated based on the percentage
change in the Consumer Price Index for all Urban Consumers (CPI-U) from
the mid-point of the last year the single payment amounts were in effect
to the month ending 6 months prior to the date the initial fee schedule
reductions go into effect. Following the initial adjustments to the fee
schedule amounts, if the adjustments continue to be based solely on
single payment amounts from competitive bidding programs that are no
longer in effect, the single payment amounts used to reduce the fee
schedule amounts are updated every 12 months using the percentage change
in the CPI-U for the 12-month period ending 6 months prior to the date
the updated payment adjustments would go into effect.
(5) Adjusted payment amounts for accessories used with different
types of base equipment. In situations where a HCPCS code that describes
an item used with different types of base equipment is included in more
than one product category in a CBA under competitive bidding, a weighted
average of the single payment amounts for the code is computed for each
CBA based on the total number of allowed services
[[Page 64]]
for the item on a national basis for the code from each product category
prior to applying the payment adjustment methodologies in this section.
(6) Adjustments of single payment amounts resulting from price
inversions under the DMEPOS Competitive Bidding Program. (i) In
situations where a price inversion defined in Sec. 414.402 occurs under
the DMEPOS Competitive Bidding Program in a competitive bidding area
(CBA) following a competition for a grouping of similar items identified
in paragraph (g)(6)(ii) of this section, prior to adjusting the fee
schedule amounts under paragraph (g) of this section the single payment
amount for each item in the grouping of similar items in the CBA is
adjusted to be equal to the weighted average of the single payment
amounts for the items in the grouping of similar items in the CBA.
(ii) The groupings of similar items subject to this rule include--
(A) Hospital beds (HCPCS codes E0250, E0251, E0255, E0256, E0260,
E0261, E0290, E0291, E0292, E0293, E0294, E0295, E0301, E0302, E0303,
and E0304).
(B) Mattresses and overlays (HCPCS codes E0277, E0371, E0372, and
E0373)
(C) Power wheelchairs (HCPCS codes K0813, K0814, K0815, K0816,
K0820, K0821, K0822, and K0823).
(D) Seat lift mechanisms (HCPCS codes E0627 and E0629).
(E) TENS devices (HCPCS codes E0720 and E0730).
(F) Walkers (HCPCS codes E0130, E0135, E0141, and E0143).
(iii) The weight for each item (HCPCS code) used in calculating the
weighted average described in paragraph (g)(6)(ii) of this section is
equal to the proportion of total nationwide allowed services furnished
in calendar year 2012 for the item (HCPCS code) in the grouping of
similar items, relative to the total nationwide allowed services
furnished in calendar year 2012 for each of the other items (HCPCS
codes) in the grouping of similar items.
(7) Payment adjustments for mail order items furnished in the
Northern Mariana Islands. The fee schedule amounts for mail order items
furnished to beneficiaries in the Northern Mariana Islands are adjusted
so that they are equal to 100 percent of the single payment amounts
established under a national mail order competitive bidding program.
Beginning on or after the date that the Northern Mariana Islands are
included under a national mail order competitive bidding program, the
fee schedule adjustment methodology under this paragraph no longer
applies.
(8) Updating adjusted fee schedule amounts. The adjusted fee
schedule amounts are revised each time a single payment amount for an
item or service is updated following one or more new competitions and as
other items are added to programs established under Subpart F of this
part.
(9) Transition rules. The payment adjustments described above are
phased in as follows:
(i) For applicable items and services furnished with dates of
service from January 1, 2016 through December 31, 2016, based on the fee
schedule amount for the area is equal to 50 percent of the adjusted
payment amount established under this section and 50 percent of the
unadjusted fee schedule amount.
(ii) For items and services furnished with dates of service from
January 1, 2017, through May 31, 2018, the fee schedule amount for the
area is equal to 100 percent of the adjusted payment amount established
under this section.
(iii) For items and services furnished in rural areas and non-
contiguous areas (Alaska, Hawaii, and U.S. territories) with dates of
service from June 1, 2018 through December 31, 2020, based on the fee
schedule amount for the area is equal to 50 percent of the adjusted
payment amount established under this section and 50 percent of the
unadjusted fee schedule amount.
(iv) For items and services furnished in areas other than rural or
noncontiguous areas with dates of service from June 1, 2018 through
December 31, 2020, based on the fee schedule amount for the area is
equal to 100 percent of the adjusted payment amount established under
this section.
(10) Payment adjustments for items and services furnished in former
competitive bidding areas during temporary gaps in the DMEPOS CBP.
During a temporary gap in the entire DMEPOS CBP and/or National Mail
Order CBP, the fee schedule amounts for items and services that were
competitively bid and
[[Page 65]]
furnished in areas that were competitive bidding areas at the time the
program(s) was in effect are adjusted based on the SPAs in effect in the
competitive bidding areas on the last day before the CBP contract period
of performance ended, increased by the projected percentage change in
the Consumer Price Index for all Urban Consumers (CPI-U) for the 12-
month period ending on the date after the contract periods ended. If the
gap in the CBP lasts for more than 12 months, the fee schedule amounts
are increased once every 12 months on the anniversary date of the first
day of the gap period based on the projected percentage change in the
CPI-U for the 12-month period ending on the anniversary date.
[57 FR 57689, Dec. 7, 1992, as amended at 71 FR 65932, Nov. 9, 2006; 73
FR 69936, Nov. 19, 2008; 73 FR 80304, Dec. 31, 2008; 74 FR 62009, Nov.
25, 2009; 79 FR 66262, Nov. 6, 2013; 81 FR 77965, Nov. 4, 2016; 83 FR
21925, May 11, 2018; 83 FR 57070, Nov. 14, 2018]
Sec. 414.220 Inexpensive or routinely purchased items.
(a) Definitions. (1) Inexpensive equipment means equipment the
average purchase price of which did not exceed $150 during the period
July 1986 through June 1987.
(2) Routinely purchased equipment means equipment that was acquired
by purchase on a national basis at least 75 percent of the time during
the period July 1986 through June 1987.
(3) Accessories. Effective January 1, 1994, accessories used in
conjunction with a nebulizer, aspirator, or ventilator excluded from
Sec. 414.222 meet the definitions of ``inexpensive equipment'' and
``routinely purchased equipment'' in paragraphs (a)(1) and (a)(2) of
this section, respectively.
(b) Payment rules. (1) Subject to the limitation in paragraph (b)(3)
of this section, payment for inexpensive and routinely purchased items
is made on a rental basis or in a lump sum amount for purchase of the
item based on the applicable fee schedule amount.
(2) Effective January 1, 1994, payment for ostomy supplies,
tracheostomy supplies, urologicals, and surgical dressings not furnished
as incident to a physician's professional service or furnished by an HHA
is made using the methodology for the inexpensive and routinely
purchased class.
(3) The total amount of payments made for an item may not exceed the
fee schedule amount recognized for the purchase of that item.
(c) Fee schedule amount for 1989 and 1990. The fee schedule amount
for payment of purchase or rental of inexpensive or routinely purchased
items furnished in 1989 and 1990 is the local payment amount determined
as follows:
(1) The carrier determines the average reasonable charge for
inexpensive or routinely purchased items that were furnished during the
period July 1, 1986 through June 30, 1987 based on the mean of the
carrier's allowed charges for the item. A separate determination of an
average reasonable charge is made for rental equipment, new purchased
equipment, and used purchased equipment.
(2) The carrier adjusts the amount determined under paragraph (c)(1)
of this section by the change in the level of the CPI-U for the 6-month
period ending December 1987.
(d) Updating the local payment amounts for years after 1990. For
each year subsequent to 1990, the local payment amounts of the preceding
year are increased or decreased by the covered item update. For 1991 and
1992, the covered item update is reduced by 1 percentage point.
(e) Calculating the fee schedule amounts for years after 1990. For
years after 1990, the fee schedule amounts are equal to the national
limited payment amount.
(f) Calculating the national limited payment amount. The national
limited payment amount is computed as follows:
(1) The 1991 national limited payment amount is equal to:
(i) 100 percent of the local payment amount if the local payment
amount is neither greater than the weighted average nor less than 85
percent of the weighted average of all local payment amounts;
(ii) The sum of 67 percent of the local payment amount plus 33
percent of the weighted average of all local payment amounts if the
local payment amount exceeds the weighted average of all local payment
amounts; or
[[Page 66]]
(iii) The sum of 67 percent of the local payment amount plus 33
percent of 85 percent of the weighted average of all local payment
amounts if the local payment amount is less than 85 percent of the
weighted average of all local payment amounts.
(2) The 1992 national limited payment amount is equal to:
(i) 100 percent of the local payment amount if the local payment
amount is neither greater than the weighted average nor less than 85
percent of the weighted average of all local payment amounts;
(ii) The sum of 33 percent of the local payment amount plus 67
percent of the weighted average of all local payment amounts if the
local payment amount exceeds the weighted average; or
(iii) The sum of 33 percent of the local payment amount plus 67
percent of 85 percent of the weighted average of all local payment
amounts if the local payment amount is less than 85 percent of the
weighted average.
(3) For 1993, the national limited payment amount is equal to one of
the following:
(i) 100 percent of the local payment amount if the local payment
amount is neither greater than the weighted average nor less than 85
percent of the weighted average of all local payment amounts.
(ii) 100 percent of the weighted average of all local payment
amounts if the local payment amount exceeds the weighted average of all
local payment amounts.
(iii) 85 percent of the weighted average of all local payment
amounts if the local payment amount is less than 85 percent of the
weighted average of all local payment amounts.
(4) For 1994 and subsequent years, the national limited payment
amount is equal to one of the following:
(i) If the local payment amount is not in excess of the median, nor
less than 85 percent of the median, of all local payment amounts--100
percent of the local payment amount.
(ii) If the local payment amount exceeds the median--100 percent of
the median of all local payment amounts.
(iii) If the local payment amount is less than 85 percent of the
median--85 percent of the median of all local payment amounts.
(g) Payment for surgical dressings. For surgical dressings furnished
after December 31, 1993, the national limited payment amount is computed
based on local payment amounts using average reasonable charges for the
12-month period ending December 31, 1992, increased by the covered item
updates for 1993 and 1994.
[57 FR 57689, Dec. 7, 1992, as amended at 60 FR 35497, July 10, 1995]
Sec. 414.222 Items requiring frequent and substantial servicing.
(a) Definition. Items requiring frequent and substantial servicing
in order to avoid risk to the beneficiary's health are the following:
(1) Ventilators (except those that are either continuous airway
pressure devices or respiratory assist devices with bi-level pressure
capability with or without a backup rate, previously referred to as
``intermittent assist devices with continuous airway pressure
devices'').
(2) Continuous and intermittent positive pressure breathing
machines.
(3) Continuous passive motion machines.
(4) Other items specified in CMS program instructions.
(5) Other items identified by the carrier.
(b) Payment rule. Rental payments for items requiring frequent and
substantial servicing are made on a monthly basis, and continue until
medical necessity ends.
(c) Fee schedule amount for 1989 and 1990. The fee schedule amount
for items requiring frequent and substantial servicing is the local
payment amount determined as follows:
(1) The carrier determines the average reasonable charge for rental
of items requiring frequent and substantial servicing that were
furnished during the period July 1, 1986 through June 30, 1987 based on
the mean of the carrier's allowed charges for the item.
(2) The carrier adjusts the amounts determined under paragraph
(c)(1) of this section by the change in the level of the CPI-U for the
6-month period ending December 1987.
[[Page 67]]
(d) Updating the fee schedule amounts for years after 1990. For
years after 1990, the fee schedules are determined using the methodology
contained in paragraphs (d), (e), and (f) of Sec. 414.220.
(e) Transition to other payment classes. For purposes of calculating
the 15-month rental period, beginning January 1, 1994, if an item has
been paid for under the frequent and substantial servicing class and is
subsequently paid for under another payment class, the rental period
begins with the first month of continuous rental, even if that period
began before January 1, 1994. For example, if the rental period began on
July 1, 1993, the carrier must use this date as beginning the first
month of rental. Likewise, for purposes of calculating the 10-month
purchase option, the rental period begins with the first month of
continuous rental without regard to when that period started. For
example, if the rental period began in August 1993, the 10-month
purchase option must be offered to the beneficiary in May 1994, the
tenth month of continuous rental.
(f) Multi-function ventilators--(1) Definition. For the purpose of
this paragraph (f), a multi-function ventilator is a ventilator as
defined in paragraph (a)(1) of this section that also performs medically
necessary functions for the patient at the same time that would
otherwise be performed by one or more different items classified under
Sec. 414.220, Sec. 414.226, or Sec. 414.229.
(2) Payment rule. Effective for dates of service on or after January
1, 2019, the monthly rental fee schedule amount for a multi-function
ventilator described in paragraph (f)(1) of this section is equal to the
monthly rental fee schedule amount for the ventilator established in
paragraph (c) and paragraph (d) of this section plus the average of the
lowest monthly cost for one additional function determined under
paragraph (f)(3) of this section and the monthly cost of all additional
functions determined under paragraph (f)(3) of this section, increased
by the annual covered item updates of section 1834(a)(14) of the Act.
(3) Monthly cost for additional functions. (i) For functions
performed by items classified under this section prior to 1994, the
monthly cost is equal to the monthly rental fee schedule amount
established in paragraphs (c) and (d) of this section increased by the
covered item update of section 1834(a)(14) of the Act.
(ii) For functions performed by items classified under Sec.
414.220, the monthly cost is equal to the fee schedule amount for
purchased equipment established in Sec. 414.220(c), (d), (e), and (f),
adjusted in accordance with Sec. 414.210(g), divided by 60 months or
total number of months of the reasonable useful lifetime of the
equipment.
(iii) For functions performed by items classified under Sec.
414.226, the monthly cost is equal to the monthly payment amount
established in Sec. 414.226(e) and (f), adjusted in accordance with
Sec. 414.210(g), multiplied by 36 and divided by 60 months or total
number of months of the reasonable useful lifetime of the oxygen
equipment.
(iv) For functions performed by items classified under Sec.
414.229, the monthly cost is equal to the purchase price established in
Sec. 414.229(c), adjusted in accordance with Sec. 414.210(g), divided
by 60 months or total number of months of the reasonable useful lifetime
of the equipment.
[57 FR 57690, Dec. 7, 1992, as amended at 60 FR 35497, July 10, 1995; 71
FR 4525, Jan. 27, 2006; 83 FR 57071, Nov. 14, 2018]
Sec. 414.224 Customized items.
(a) Criteria for a customized item. To be considered a customized
item for payment purposes under paragraph (b) of this section, a covered
item (including a wheelchair) must be uniquely constructed or
substantially modified for a specific beneficiary according to the
description and orders of a physician and be so different from another
item used for the same purpose that the two items cannot be grouped
together for pricing purposes.
(b) Payment rule. Payment is made on a lump sum basis for the
purchase of a customized item based on the carrier's individual
consideration and judgment of a reasonable payment amount for each
customized item. The carrier's individual consideration takes into
account written documentation on the costs of the item including at
least the
[[Page 68]]
cost of labor and materials used in customizing an item.
[56 FR 65998, Dec. 20, 1991, as amended at 58 FR 34919, June 30, 1993]
Sec. 414.226 Oxygen and oxygen equipment.
(a) Payment rules--(1) Oxygen equipment. Payment for rental of
oxygen equipment is made based on a monthly fee schedule amount during
the period of medical need, but for no longer than a period of
continuous use of 36 months. A period of continuous use is determined
under the provisions in Sec. 414.230.
(2) Oxygen contents. Payment for purchase of oxygen contents is made
based on a monthly fee schedule amount until medical necessity ends.
(b) Monthly fee schedule amount for items furnished prior to 2007.
(1) Monthly fee schedule amounts are separately calculated for the
following items:
(i) Stationary oxygen equipment and oxygen contents (stationary and
portable oxygen contents).
(ii) Portable oxygen equipment only.
(iii) Stationary and portable oxygen contents only.
(iv) Portable oxygen contents only.
(2) For 1989 and 1990, the monthly fee schedule amounts are the
local payment amounts determined as follows:
(i) The carrier determines the base local average monthly payment
rate equal to the total reasonable charges for the item for the 12-month
period ending December 1986 divided by the total number of months for
all beneficiaries receiving the item for the same period. In determining
the local average monthly payment rate, the following limitations apply:
(A) Purchase charges for oxygen systems are not included as items
classified under paragraph (b)(1)(i) of this section.
(B) Purchase charges for portable equipment are not included as
items classified under paragraph (b)(1)(ii) of this section.
(ii) The carrier determines the local monthly payment amount equal
to 0.95 times the base local average monthly payment amount adjusted by
the change in the CPI-U for the six-month period ending December 1987.
(3) For 1991 through 2006, the fee schedule amounts for items
described in paragraphs (b)(1)(iii) and (iv) of this section are
determined using the methodology contained in Sec. 414.220(d), (e), and
(f).
(4) For 1991 through 2006, the fee schedule amounts for items
described in paragraphs (b)(1)(i) and (ii) of this section are
determined using the methodology contained in Sec. 414.220(d), (e), and
(f).
(5) For 2005 and 2006, the fee schedule amounts determined under
paragraph (b)(4) of this section are reduced using the methodology
described in section 1834(a)(21)(A) of the Act.
(c) Monthly fee schedule amount for items furnished from 2007
through 2018. (1) For 2007, national limited monthly payment rates are
calculated and paid as the monthly fee schedule amounts for the
following classes of items:
(i) Stationary oxygen equipment (including stationary concentrators)
and oxygen contents (stationary and portable).
(ii) Portable equipment only (gaseous or liquid tanks).
(iii) Oxygen generating portable equipment only.
(iv) Stationary oxygen contents only.
(v) Portable oxygen contents only.
(2) The national limited monthly payment rate for items described in
paragraph (c)(1)(i) of this section is equal to the weighted average fee
schedule amount established under paragraph (b)(5) of this section
reduced by $1.44.
(3) The national limited monthly payment rate for items described in
paragraph (c)(1)(ii) of this section is equal to the weighted average of
the fee schedule amounts established under paragraph (b)(5) of this
section.
(4) The national limited monthly payment rate for items described in
paragraph (c)(1)(iii) of this section is equal to the national limited
monthly payment rate established under paragraph (c)(5) of this section,
multiplied by 24, and divided by 36.
(5) The national limited monthly payment rate for items described in
paragraphs (c)(1)(iv) and (c)(1)(v) of this section is equal to 50
percent of the weighted average fee schedule amounts established under
paragraph (b)(3) of
[[Page 69]]
this section for items described in paragraph (b)(1)(iii) of this
section.
(6) For 2008 through 2018, CMS makes an annual adjustment to the
national limited monthly payment rate for items described in paragraph
(c)(1)(i) of this section to ensure that such payment rates do not
result in expenditures for any year that are more or less than the
expenditures that would have been made if such classes had not been
established.
(d) Application of monthly fee schedule amounts for items furnished
from 2007 through 2018. (1) The fee schedule amount for items described
in paragraph (c)(1)(i) of this section is paid when the beneficiary
rents stationary oxygen equipment.
(2) Subject to the limitation set forth in paragraph (g)(2) of this
section, the fee schedule amount for items described in paragraphs
(c)(1)(ii) and (c)(1)(iii) of this section is paid when the beneficiary
rents portable oxygen equipment.
(3) The fee schedule amount for items described in paragraph
(c)(1)(iv) of this section is paid when the beneficiary--
(i) Owns stationary oxygen equipment that requires delivery of
gaseous or liquid oxygen contents; or
(ii) Rents stationary oxygen equipment that requires delivery of
gaseous or liquid oxygen contents after the period of continuous use of
36 months described in paragraph (a)(1) of this section.
(4) The fee schedule amount for items described in paragraph
(c)(1)(v) of this section is paid when the beneficiary--
(i) Owns portable oxygen equipment described in (c)(1)(ii) of this
section;
(ii) Rents portable oxygen equipment described in paragraph
(c)(1)(ii) of this section during the period of continuous use of 36
months described in paragraph (a)(1) of this section and does not rent
stationary oxygen equipment; or
(iii) Rents portable oxygen equipment described in paragraph
(c)(1)(ii) of this section after the period of continuous use of 36
months described in paragraph (a)(1) of this section.
(e) Monthly fee schedule amount for items furnished for years after
2018. (1) For 2019, national limited monthly payment rates are
calculated and paid as the monthly fee schedule amounts for the
following classes of items:
(i) Stationary oxygen equipment (including stationary concentrators)
and oxygen contents (stationary and portable).
(ii) Portable gaseous equipment only.
(iii) Portable liquid equipment only.
(iv) Oxygen generating portable equipment only.
(v) Stationary oxygen contents only.
(vi) Portable oxygen contents only, except for portable liquid
oxygen contents for prescribed flow rates greater than four liters per
minute.
(vii) Portable liquid oxygen contents only for prescribed flow rates
of more than 4 liters per minute.
(2) The monthly payment rate for items described in paragraphs
(e)(1)(i), (ii), (iv), (v), and (vi) of this section are determined
using the applicable methodologies contained in Sec. 414.210(g).
(3) The monthly payment rate for items described in paragraph
(e)(1)(iii) of this section is determined initially based on the monthly
payment rate for items described in paragraph (e)(1)(iv) of this section
and is subsequently adjusted using the applicable methodologies
contained in Sec. 414.210(g).
(4) The monthly payment rate for items described in paragraph
(e)(1)(vii) of this section is determined initially based on 150 percent
of the monthly payment rate for items described in paragraph (e)(1)(vi)
of this section and is subsequently adjusted using the applicable
methodologies contained in Sec. 414.210(g).
(5) Beginning in 2019, CMS makes an annual adjustment to the monthly
payment rate for items described in paragraphs (e)(1)(i) through
(e)(1)(vii) of this section to ensure that such payment rates do not
result in expenditures for any year that are more or less than the
expenditures that would have been made if such classes had not been
established.
(f) Application of monthly fee schedule amounts for items furnished
for years after 2018. (1) The fee schedule amount for items described in
paragraph (e)(1)(i) of this section is paid when the beneficiary rents
stationary oxygen equipment.
(2) Subject to the limitation set forth in paragraph (g)(2) of this
section, the
[[Page 70]]
fee schedule amount for items described in paragraphs (e)(1)(ii), (iii),
and (iv) of this section is paid when the beneficiary rents portable
oxygen equipment.
(3) The fee schedule amount for items described in paragraph
(e)(1)(v) of this section is paid when the beneficiary--
(i) Owns stationary oxygen equipment that requires delivery of
gaseous or liquid oxygen contents; or
(ii) Rents stationary oxygen equipment that requires delivery of
gaseous or liquid oxygen contents after the period of continuous use of
36 months described in paragraph (a)(1) of this section.
(4) The fee schedule amount for items described in paragraph
(e)(1)(vi) of this section is paid when the beneficiary--
(i) Owns portable oxygen equipment described in paragraphs
(e)(1)(ii) or (e)(1)(iii) of this section; or Code of Federal
Regulations/Title 42--Public Health/Vol. 3/2017-10-0166
(ii) Rents portable oxygen equipment described in paragraphs
(e)(1)(ii) or (e)(1)(iii) of this section during the period of
continuous use of 36 months described in paragraph (a)(1) of this
section and does not rent stationary oxygen equipment; or
(iii) Rents portable oxygen equipment described in paragraphs
(e)(1)(ii) or (e)(1)(iii) of this section after the period of continuous
use of 36 months described in paragraph (a)(1) of this section.
(5) The fee schedule amount for items described in paragraph
(e)(1)(vii) of this section is paid when the beneficiary has a
prescribed flow rate of more than 4 liters per minute and--
(i) Owns portable liquid oxygen equipment described in paragraph
(e)(1)(iii) of this section; or Code of Federal Regulations/Title 42--
Public Health/Vol. 3/2017-10-0166
(ii) Rents portable liquid oxygen equipment described in paragraph
(e)(1)(iii) of this section during the period of continuous use of 36
months described in paragraph (a)(1) of this section and does not rent
stationary oxygen equipment; or
(iii) Rents portable liquid oxygen equipment described in paragraph
(e)(1)(iii) of this section after the period of continuous use of 36
months described in paragraph (a)(1) of this section.
(g) Volume adjustments. (1) The fee schedule amount for an item
described in paragraph (c)(1)(i) of this section is adjusted as follows:
(i) If the attending physician prescribes an oxygen flow rate
exceeding four liters per minute, the fee schedule amount is increased
by 50 percent, subject to the limit in paragraph (g)(2) of this section.
(ii) If the attending physician prescribes an oxygen flow rate of
less than one liter per minute, the fee schedule amount is decreased by
50 percent.
(2) If portable oxygen equipment is used and the prescribed oxygen
flow rate exceeds four liters per minute, the total fee schedule amount
recognized for payment is limited to the higher of--
(i) The sum of the monthly fee schedule amount for the items
described in paragraphs (c)(1)(i) and (c)(1)(ii) or (c)(1)(iii) of this
section; or
(ii) The adjusted fee schedule amount described in paragraph
(g)(1)(i) of this section.
(3) In establishing the volume adjustment for those beneficiaries
whose physicians prescribe varying flow rates, the following rules
apply:
(i) If the prescribed flow rate is different for stationary oxygen
equipment than for portable oxygen equipment, the flow rate for the
stationary equipment is used.
(ii) If the prescribed flow rate is different for the patient at
rest than for the patient at exercise, the flow rate for the patient at
rest is used.
(iii) If the prescribed flow rate is different for nighttime use and
daytime use, the average of the two flow rates is used.
(h) Furnishing oxygen and oxygen equipment after the 36-month rental
cap. (1) The supplier that furnishes oxygen equipment for the 36th
continuous month during which payment is made under this section must--
(i) Continue to furnish the equipment during any period of medical
need for the remainder of the reasonable useful lifetime established for
the equipment in accordance with Sec. 414.210(f)(1); or
(ii) Arrange for furnishing the oxygen equipment with another
supplier if the
[[Page 71]]
beneficiary relocates to an area that is outside the normal service area
of the supplier that initially furnished the equipment.
(2) The supplier that furnishes liquid or gaseous oxygen equipment
(stationary or portable) for the 36th continuous month during which
payment is made under this section must--
(i) Continue to furnish the oxygen contents necessary for the
effective use of the liquid or gaseous equipment during any period of
medical need for the remainder of the reasonable useful lifetime
established for the equipment in accordance with Sec. 414.210(f)(1); or
(ii) Arrange for furnishing the oxygen contents with another
supplier if the beneficiary relocates to an area that is outside the
normal service area of the supplier that initially furnished the
equipment.
(i) Additional supplier requirements for rentals that begin on or
after January 1, 2007. (1) The supplier that furnishes oxygen equipment
for the first month during which payment is made under this section must
continue to furnish the equipment for the entire 36-month period of
continuous use, unless medical necessity ends or--
(i) The item becomes subject to a competitive acquisition program
implemented in accordance with section 1847(a) of the Act;
(ii) The beneficiary relocates to an area that is outside the normal
service area of the supplier that initially furnished the equipment;
(iii) The beneficiary elects to obtain oxygen equipment from a
different supplier prior to the expiration of the 36-month rental
period; or
(iv) CMS or the carrier determines that an exception should apply in
an individual case based on the circumstances.
(2) Oxygen equipment furnished under this section may not be
replaced by the supplier prior to the expiration of the reasonable
useful lifetime established for the equipment in accordance with Sec.
414.210(f)(1) unless:
(i) The supplier replaces an item with the same, or equivalent, make
and model of equipment because the item initially furnished was lost,
stolen, irreparably damaged, is being repaired, or no longer functions;
(ii) A physician orders different equipment for the beneficiary. If
the order is based on medical necessity, then the order must indicate
why the equipment initially furnished is no longer medically necessary
and the supplier must retain this order in the beneficiary's medical
record;
(iii) The beneficiary chooses to obtain a newer technology item or
upgraded item and signs an advanced beneficiary notice (ABN); or
(iv) CMS or the carrier determines that a change in equipment is
warranted.
(3) Before furnishing oxygen equipment, the supplier must disclose
to the beneficiary its intentions regarding whether it will accept
assignment of all monthly rental claims for the duration of the rental
period. A supplier's intentions could be expressed in the form of a
written agreement between the supplier and the beneficiary.
[57 FR 57690, Dec. 7, 1992, as amended at 71 FR 65933, Nov. 9, 2006; 73
FR 69936, Nov. 19, 2008; 78 FR 72253, Dec. 2, 2013; 83 FR 57071, Nov.
14, 2018]
Sec. 414.228 Prosthetic and orthotic devices.
(a) Payment rule. Payment is made on a lump-sum basis for prosthetic
and orthotic devices subject to this subpart.
(b) Fee schedule amounts. The fee schedule amount for prosthetic and
orthotic devices is determined as follows:
(1) The carrier determines a base local purchase price equal to the
average reasonable charge for items purchased during the period July 1,
1986 through June 30, 1987 based on the mean of the carrier's allowed
charges for the item.
(2) The carrier determines a local purchase price equal to the
following:
(i) For 1989 and 1990, the base local purchase price is adjusted by
the change in the level of the CPI-U for the 6-month period ending
December 1987.
(ii) For 1991 through 1993, the local purchase price for the
preceding year is adjusted by the applicable percentage increase for the
year. The applicable percentage increase is equal to 0 percent for 1991.
For 1992 and 1993, the applicable percentage increase is equal to
[[Page 72]]
the percentage increase in the CPI-U for the 12-month period ending with
June of the previous year.
(iii) For 1994 and 1995, the applicable percentage increase is 0
percent.
(iv) For all subsequent years the applicable percentage increase is
equal to the percentage increase in the CPI-U for the 12-month period
ending with June of the previous year.
(3) CMS determines the regional purchase price equal to the
following:
(i) For 1992, the average (weighted by the relative volume of all
claims among carriers) of the local purchase prices for the carriers in
the region.
(ii) For 1993 and subsequent years, the regional purchase price for
the preceding year adjusted by the applicable percentage increase for
the year.
(4) CMS determines a purchase price equal to the following:
(i) For 1989, 1990 and 1991, 100 percent of the local purchase
price.
(ii) For 1992, 75 percent of the local purchase price plus 25
percent of the regional purchase price.
(iii) For 1993, 50 percent of the local purchase price plus 50
percent of the regional purchase price.
(iv) For 1994 and subsequent years, 100 percent of the regional
purchase price.
(5) For 1992 and subsequent years, CMS determines a national average
purchase price equal to the unweighted average of the purchase prices
determined under paragraph (b)(4) of this section for all carriers.
(6) CMS determines the fee schedule amount equal to 100 percent of
the purchase price determined under paragraph (b)(4) of this section,
subject to the following limitations:
(i) For 1992, the amount cannot be greater than 125 percent nor less
than 85 percent of the national average purchase price determined under
paragraph (b)(5) of this section.
(ii) For 1993 and subsequent years, the amount cannot be greater
than 120 percent of the national average nor less than 90 percent of the
national average purchase price determined under paragraph (b)(5) of
this section.
(c) Payment for therapeutic shoes. The payment rules specified in
paragraphs (a) and (b) of this section are applicable to custom molded
and extra depth shoes, modifications, and inserts (therapeutic shoes)
furnished after December 31, 2004.
[57 FR 57691, Dec. 7, 1992, as amended at 60 FR 35498, July 10, 1995; 73
FR 69937, Nov. 19, 2008]
Sec. 414.229 Other durable medical equipment--capped rental items.
(a) General payment rule. Payment is made for other durable medical
equipment that is not subject to the payment provisions set forth in
Sec. 414.220 through Sec. 414.228 as follows:
(1) For items furnished prior to January 1, 2006, payment is made on
a rental or purchase option basis in accordance with the rules set forth
in paragraphs (b) through (e) of this section.
(2) For items other than power-driven wheelchairs furnished on or
after January 1, 2006, payment is made in accordance with the rules set
forth in paragraph (f) of this section.
(3) For power-driven wheelchairs furnished on or after January 1,
2006 through December 31, 2010, payment is made in accordance with the
rules set forth in paragraphs (f) or (h) of this section.
(4) For power-driven wheelchairs that are not classified as complex
rehabilitative power-driven wheelchairs, furnished on or after January
1, 2011, payment is made in accordance with the rules set forth in
paragraph (f) of this section.
(5) For power-driven wheelchairs classified as complex
rehabilitative power-driven wheelchairs, furnished on or after January
1, 2011, payment is made in accordance with the rules set forth in
paragraphs (f) or (h) of this section.
(b) Fee schedule amounts for rental. (1) For 1989 and 1990, the
monthly fee schedule amount for rental of other covered durable medical
equipment equals 10 percent of the purchase price recognized as
determined under paragraph (c) of this section subject to the following
limitation: For 1989 and 1990, the fee schedule amount cannot be greater
than 115 percent nor less than 85 percent of the prevailing charge, as
determined under Sec. 405.504 of this chapter, established for rental
of the item in January 1987, as adjusted by the
[[Page 73]]
change in the level of the CPI-U for the 6-month period ending December
1987.
(2) For 1991 and subsequent years, the monthly fee schedule amount
for rental of other covered durable medical equipment equals 10 percent
of the purchase price recognized as determined under paragraph (c) of
this section for each of the first 3 months and 7.5 percent of the
purchase price for each of the remaining months.
(3) For power-driven wheelchairs furnished on or after January 1,
2011, the monthly fee schedule amount for rental equipment equals 15
percent of the purchase price recognized as determined under paragraph
(c) of this section for each of the first 3 months and 6 percent of the
purchase price for each of the remaining months.
(c) Determination of purchase price. The purchase price of other
covered durable medical equipment is determined as follows:
(1) For 1989 and 1990. (i) The carrier determines a base local
purchase price amount equal to the average of the purchase prices
submitted on an assignment-related basis of new items supplied during
the 6-month period ending December 1986.
(ii) The purchase price is equal to the base local purchase price
adjusted by the change in the level of the CPI-U for the 6-month period
ending December 1987.
(2) For 1991. (i) The local payment amount is the purchase price for
the preceding year adjusted by the covered item update for 1991 and
decreased by the percentage by which the average of the reasonable
charges for claims paid for all other items described in Sec. 414.229,
is lower than the average of the purchase prices submitted for such
items during the final 9 months of 1988.
(ii) The purchase price for 1991 is the national limited payment
amount as determined using the methodology contained in Sec.
414.220(f).
(3) For years after 1991. The purchase price is determined using the
methodology contained in paragraphs (d) through (f) of Sec. 414.220.
(d) Purchase option. Suppliers must offer a purchase option to
beneficiaries during the 10th continuous rental month and, for power-
driven wheelchairs, the purchase option must also be made available at
the time the equipment is initially furnished.
(1) Suppliers must offer beneficiaries the option of purchasing
power-driven wheelchairs at the time the supplier first furnishes the
item. On or after January 1, 2011, this option is available only for
complex rehabilitative power-driven wheelchairs. Payment must be on a
lump-sum fee schedule purchase basis if the beneficiary chooses the
purchase option. The purchase fee is the amount established in paragraph
(c) of this section.
(2) Suppliers must offer beneficiaries the option of converting
capped rental items (including power-driven wheelchairs not purchased
when initially furnished) to purchased equipment during their 10th
continuous rental month. Beneficiaries have one month from the date the
supplier makes the offer to accept the purchase option.
(i) If the beneficiary does not accept the purchase option, payment
continues on a rental basis not to exceed a period of continuous use of
longer than 15 months. After 15 months of rental payments have been
paid, the supplier must continue to provide the item without charge,
other than a charge for maintenance and servicing fees, until medical
necessity ends or Medicare coverage ceases. A period of continuous use
is determined under the provisions in Sec. 414.230.
(ii) If the beneficiary accepts the purchase option, payment
continues on a rental basis not to exceed a period of continuous use of
longer than 13 months. On the first day after 13 continuous rental
months during which payment is made, the supplier must transfer title to
the equipment to the beneficiary.
(e) Payment for maintenance and servicing. (1) The carrier
establishes a reasonable fee for maintenance and servicing for each
rented item of other durable medical equipment. The fee may not exceed
10 percent of the purchase price recognized as determined under
paragraph (c) of this section.
(2) Payment of the fee for maintenance and servicing of other
durable medical equipment that is rented is made only for equipment that
continues to be used after 15 months of
[[Page 74]]
rental payments have been made and is limited to the following:
(i) For the first 6-month period, no payments are to be made.
(ii) For each succeeding 6-month period, payment may be made during
the first month of that period.
(3) Payment for maintenance and servicing DME purchased in
accordance with paragraphs (d)(1) and (d)(2)(ii) of this section, is
made on the basis of reasonable and necessary charges.
(f) Rules for capped rental items furnished beginning on or after
January 1, 2006. (1) For items furnished on or after January 1, 2006,
payment is made based on a monthly rental fee schedule amount during the
period of medical need, but for no longer than a period of continuous
use of 13 months. A period of continuous use is determined under the
provisions in Sec. 414.230.
(2) The supplier must transfer title to the item to the beneficiary
on the first day that begins after the 13th continuous month in which
payments are made under paragraph (f)(1) of this section.
(3) Payment for maintenance and servicing of beneficiary-owned
equipment is made in accordance with Sec. 414.210(e).
(g) Additional supplier requirements for capped rental items that
are furnished beginning on or after January 1, 2007. (1) The supplier
that furnishes an item for the first month during which payment is made
using the methodology described in paragraph (f)(1) of this section must
continue to furnish the equipment until medical necessity ends, or the
13-month period of continuous use ends, whichever is earlier, unless--
(i) The item becomes subject to a competitive acquisition program
implemented in accordance with section 1847(a) of the Act;
(ii) The beneficiary relocates to an area that is outside the normal
service area of the supplier that initially furnished the equipment;
(iii) The beneficiary elects to obtain the equipment from a
different supplier prior to the expiration of the 13-month rental
period; or
(iv) CMS or the carrier determines that an exception should apply in
an individual case based on the circumstances.
(2) A capped rental item furnished under this section may not be
replaced by the supplier prior to the expiration of the 13-month rental
period unless:
(i) The supplier replaces an item with the same, or equivalent, make
and model of equipment because the item initially furnished was lost,
stolen, irreparably damaged, is being repaired, or no longer functions;
(ii) A physician orders different equipment for the beneficiary. If
the need for different equipment is based on medical necessity, then the
order must indicate why the equipment initially furnished is no longer
medically necessary and the supplier must retain this order in the
beneficiary's medical record;
(iii) The beneficiary chooses to obtain a newer technology item or
upgraded item and signs an advanced beneficiary notice (ABN); or
(iv) CMS or the carrier determines that a change in equipment is
warranted.
(3) Before furnishing a capped rental item, the supplier must
disclose to the beneficiary its intentions regarding whether it will
accept assignment of all monthly rental claims for the duration of the
rental period. A supplier's intentions could be expressed in the form of
a written agreement between the supplier and the beneficiary.
(4) No later than two months before the date on which the supplier
must transfer title to a capped rental item to the beneficiary, the
supplier must disclose to the beneficiary whether it can maintain and
service the item after the beneficiary acquires title to it. CMS or its
carriers may make exceptions to this requirement on a case-by-case
basis.
(h) Purchase of power-driven wheelchairs furnished on or after
January 1, 2006. (1) Suppliers must offer beneficiaries the option to
purchase power-driven wheelchairs at the time the equipment is initially
furnished.
(2) Payment is made on a lump-sum purchase basis if the beneficiary
chooses this option.
[[Page 75]]
(3) On or after January 1, 2011, this option is available only for
complex rehabilitative power-driven wheelchairs.
[57 FR 57691, Dec. 7, 1992, as amended at 60 FR 35498, July 10, 1995; 71
FR 65934, Nov. 9, 2006; 75 FR 73622, Nov. 29, 2010]
Sec. 414.230 Determining a period of continuous use.
(a) Scope. This section sets forth the rules that apply in
determining a period of continuous use for rental of durable medical
equipment.
(b) Continuous use. (1) A period of continuous use begins with the
first month of medical need and lasts until a beneficiary's medical need
for a particular item of durable medical equipment ends.
(2) In the case of a beneficiary receiving oxygen equipment on
December 31, 2005, the period of continuous use for the equipment begins
on January 1, 2006.
(c) Temporary interruption. (1) A period of continuous use allows
for temporary interruptions in the use of equipment.
(2) An interruption of not longer than 60 consecutive days plus the
days remaining in the rental month in which use ceases is temporary,
regardless of the reason for the interruption.
(3) Unless there is a break in medical necessity that lasts lnnger
than 60 consecutive days plus the days remaining in the rental month in
which use ceases, medical necessity is presumed to continue.
(d) Criteria for a new rental period. If an interruption in the use
of equipment continues for more than 60 consecutive days plus the days
remaining in the rental month in which use ceases, a new rental period
begins if the supplier submits all of the following information--
(1) A new prescription.
(2) New medical necessity documentation.
(3) A statement describing the reason for the interruption and
demonstrating that medical necessity in the prior episode ended.
(e) Beneficiary moves. A permanent or temporary move made by a
beneficiary does not constitute an interruption in the period of
continuous use.
(f) New equipment. (1) If a beneficiary changes equipment or
requires additional equipment based on a physician's prescription, and
the new or additional equipment is found to be necessary, a new period
of continuous use begins for the new or additional equipment. A new
period of continuous use does not begin for base equipment that is
modified by an addition.
(2) A new period of continuous use does not begin when a beneficiary
changes from one stationary oxygen equipment modality to another or from
one portable oxygen equipment modality to another.
(g) New supplier. If a beneficiary changes suppliers, a new period
of continuous use does not begin.
(h) Oxygen equipment furnished after the 36-month rental period. A
new period of continuous use does not begin under any circumstance in
the case of oxygen equipment furnished after the 36-month rental period
in accordance with Sec. 414.226(h) until the end of the reasonable
useful lifetime established for such equipment in accordance with Sec.
414.210(h).
[56 FR 50823, Oct. 9, 1991, as amended at 57 FR 57111, Dec. 3, 1992; 71
FR 65935, Nov. 9, 2006; 73 FR 69937, Nov. 19, 2008; 83 FR 57072, Nov.
14, 2018]
Sec. 414.232 Special payment rules for transcutaneous electrical
nerve stimulators (TENS).
(a) General payment rule. Except as provided in paragraph (b) of
this section, payment for TENS is made on a purchase basis with the
purchase price determined using the methodology for purchase of
inexpensive or routinely purchased items as described in Sec. 414.220.
The payment amount for TENS computed under Sec. 414.220(c)(2) is
reduced according to the following formula:
(1) Effective April 1, 1990--the original payment amount is reduced
by 15 percent.
(2) Effective January 1, 1991--the reduced payment amount in
paragraph (a)(1) is reduced by 15 percent.
(3) Effective January 1, 1994--the reduced payment amount in
paragraph (a)(1) is reduced by 45 percent.
(b) Exception. In order to permit an attending physician time to
determine
[[Page 76]]
whether the purchase of the TENS is medically appropriate for a
particular patient, two months of rental payments may be made in
addition to the purchase price. The rental payments are equal to 10
percent of the purchase price.
[57 FR 57692, Dec. 7, 1992, as amended at 60 FR 35498, July 10, 1995]
Sec. 414.234 Prior authorization for items frequently subject to
unnecessary utilization.
(a) Definitions. For the purpose of this section, the following
definitions apply:
Prior authorization is a process through which a request for
provisional affirmation of coverage is submitted to CMS or its
contractors for review before the item is furnished to the beneficiary
and before the claim is submitted for processing.
Provisional affirmation is a preliminary finding that a future claim
meets Medicare's coverage, coding, and payment rules.
Unnecessary utilization means the furnishing of items that do not
comply with one or more of Medicare's coverage, coding, and payment
rules.
(b) Master list of items frequently subject to unnecessary
utilization. (1) The Master List of Items Frequently Subject to
Unnecessary Utilization includes items listed on the Durable Medical
Equipment, Prosthetics, Orthotics, and Supplies fee schedule with an
average purchase fee of $1,000 (adjusted annually for inflation using
consumer price index for all urban consumers (CPI-U)) or greater or an
average rental fee schedule of $100 (adjusted annually for inflation
using CPI-U) or greater that also meet one of the following two
criteria:
(i) The item has been identified as having a high rate of fraud or
unnecessary utilization in a report that is national in scope from 2007
or later published by any of the following:
(A) The Office of Inspector General (OIG).
(B) The General Accountability Office (GAO).
(ii) The item is listed in the 2011 or later Comprehensive Error
Rate Testing (CERT) program's Annual Medicare Fee-For-Service (FFS)
Improper Payment Rate Report DME and/or DMEPOS Service Specific
Report(s).
(2) The Master List of DMEPOS Items Frequently Subject to
Unnecessary Utilization is self-updating annually and is published in
the Federal Register.
(3) DMEPOS items identified as having a high rate of fraud or
unnecessary utilization in any of the following reports that are
national in scope and meeting the payment threshold criteria set forth
in paragraph (b)(1) of this section are added to the Master List:
(i) OIG reports published after 2015.
(ii) GAO reports published after 2015.
(iii) CERT program's Annual Medicare FFS Improper Payment Rate
Report DME and/or DMEPOS Service Specific Report(s) published after
2015, also referred to as the Comprehensive Error Rate Testing (CERT)
program's Annual Medicare FFS Improper Payment Rate Report DME Service
Specific Report(s).
(4) Items remain on the Master List for 10 years from the date the
item was added to the Master List.
(5) Items that are discontinued or are no longer covered by Medicare
are removed from the Master List.
(6) An item is removed from the list if the purchase amount drops
below the payment threshold (an average purchase fee of $1,000 or
greater or an average monthly rental fee schedule of $100 or greater).
(7) An item is removed from the Master List and replaced by its
equivalent when the Healthcare Common Procedure Coding System (HCPCS)
code representing the item has been discontinued and cross-walked to an
equivalent item.
(c) Condition of payment--(1) Items requiring prior authorization.
CMS publishes in the Federal Register and posts on the CMS Prior
Authorization Web site a list of items, the Required Prior Authorization
List, that require prior authorization as a condition of payment.
(i) The Required Prior Authorization List specified in paragraph
(c)(1) of this section is selected from the Master List of Items
Frequently Subject to Unnecessary Utilization (as described in paragraph
(b) of this section). CMS
[[Page 77]]
may consider factors such as geographic location, item utilization or
cost, system capabilities, administrative burden, emerging trends,
vulnerabilities identified in official agency reports, or other data
analysis.
(ii) CMS may elect to limit the prior authorization requirement to a
particular region of the country if claims data analysis shows that
unnecessary utilization of the selected item(s) is concentrated in a
particular region.
(iii) The Required Prior Authorization List is effective no less
than 60 days after publication and posting.
(2) Denial of claims. (i) CMS or its contractors denies a claim for
an item that requires prior authorization if the claim has not received
a provisional affirmation.
(ii) Claims receiving a provisional affirmation may be denied based
on either of the following:
(A) Technical requirements that can only be evaluated after the
claim has been submitted for formal processing.
(B) Information not available at the time of a prior authorization
request.
(d) Submission of prior authorization requests. A prior
authorization request must do the following:
(1) Include all relevant documentation necessary to show that the
item meets applicable Medicare coverage, coding, and payment rules,
including all of the following:
(i) Order.
(ii) Relevant information from the beneficiary's medical record.
(iii) Relevant supplier produced documentation.
(2) Be submitted before the item is furnished to the beneficiary and
before the claim is submitted for processing.
(e) Review of prior authorization requests. (1) After receipt of a
prior authorization request, CMS or its contractor reviews the prior
authorization request for compliance with applicable Medicare coverage,
coding, and payment rules.
(2) If applicable Medicare coverage, coding, and payment rules are
met, CMS or its contractor issues a provisional affirmation to the
requester.
(3)(i) If applicable Medicare coverage, coding, and payment rules
are not met, CMS or its contractor issues a non-affirmation decision to
the requester.
(ii) If the requester receives a non-affirmation decision, the
requester may resubmit a prior authorization request before the item is
furnished to the beneficiary and before the claim is submitted for
processing.
(4) Expedited reviews. (i) A prior authorization request for an
expedited review must include documentation that shows that processing a
prior authorization request using a standard timeline for review could
seriously jeopardize the life or health of the beneficiary or the
beneficiary's ability to regain maximum function.
(ii) If CMS or its contractor agrees that processing a prior
authorization request using a standard timeline for review could
seriously jeopardize the life or health of the beneficiary or the
beneficiary's ability to regain maximum function, then CMS or its
contractor expedites the review of the prior authorization request and
communicates the decision following the receipt of all applicable
Medicare required documentation.
(f) Suspension of prior authorization requests. (1) CMS may suspend
prior authorization requirements generally or for a particular item or
items at any time and without undertaking rulemaking.
(2) CMS provides notification of the suspension of the prior
authorization requirements via--
(i) Federal Register notice; and
(ii) Posting on the CMS prior authorization Web site.
[80 FR 81706, Dec. 30, 2015]
Subpart E_Determination of Reasonable Charges Under the ESRD Program
Sec. 414.300 Scope of subpart.
This subpart sets forth criteria and procedures for payment of the
following services furnished to ESRD patients:
(a) Physician services related to renal dialysis.
(b) Physician services related to renal transplantation.
(c) Home dialysis equipment, supplies, and support services.
(d) Epoetin (EPO) furnished by a supplier of home dialysis equipment
and
[[Page 78]]
supplies to a home dialysis patient for use in the home.
[55 FR 23441, June 8, 1990, as amended at 56 FR 43710, Sept. 4, 1991; 59
FR 1285, Jan. 10, 1994]
Sec. 414.310 Determination of reasonable charges for physician services
furnished to renal dialysis patients.
(a) Principle. Physician services furnished to renal dialysis
patients are subject to payment if the services are otherwise covered by
the Medicare program and if they are considered reasonable and medically
necessary in accordance with section 1862(a)(1)(A) of the Act.
(b) Scope and applicability--(1) Scope. This section pertains to
physician services furnished to the following patients:
(i) Outpatient maintenance dialysis patients who dialyze--
(A) In an independent or hospital-based ESRD facility, or
(B) At home.
(ii) Hospital inpatients for which the physician elects to continue
payment under the monthly capitation payment (MCP) method described in
Sec. 414.314.
(2) Applicability. These provisions apply to routine professional
services of physicians. They do not apply to administrative services
performed by physicians, which are paid for as part of a prospective
payment for dialysis services made to the facility under Sec. 413.170
of this chapter.
(c) Definitions. For purposes of this section, the following
definitions apply:
Administrative services are physician services that are
differentiated from routine professional services and other physician
services because they are supervision, as described in the definition of
``supervision of staff'' of this section, or are not related directly to
the care of an individual patient, but are supportive of the facility as
a whole and of benefit to patients in general. Examples of
administrative services include supervision of staff, staff training,
participation in staff conferences and in the management of the
facility, and advising staff on the procurement of supplies.
Dialysis session is the period of time that begins when the patient
arrives at the facility and ends when the patient departs from the
facility. In the case of home dialysis, the period begins when the
patient prepares for dialysis and generally ends when the patient is
disconnected from the machine. In this context, a dialysis facility
includes only those parts of the building used as a facility. It does
not include any areas used as a physician's office.
Medical direction, in contrast to supervision of staff, is a routine
professional service that entails substantial direct involvement and the
physical presence of the physician in the delivery of services directly
to the patient.
Routine professional services include all physicians' services
furnished during a dialysis session and all services listed in paragraph
(d) of this section that meet the following requirements:
(1) They are personally furnished by a physician to an individual
patient.
(2) They contribute directly to the diagnosis or treatment of an
individual patient.
(3) They ordinarily must be performed by a physician.
Supervision of staff, in contrast to medical direction, is an
administrative service that does not necessarily require the physician
to be present at the dialysis session. It is a general activity
primarily concerned with monitoring performance of and giving guidance
to other health care personnel (such as nurses and dialysis technicians)
who deliver services to patients.
(d) Types of routine professional services. Routine professional
services include at least all of the following services when medically
appropriate:
(1) Visits to the patient during dialysis, and review of laboratory
test results, nurses' notes and any other medical documentation, as a
basis for--
(i) Adjustment of the patient's medication or diet, or the dialysis
procedure;
(ii) Prescription of medical supplies; and
(iii) Evaluation of the patient's psychosocial status and the
appropriateness of the treatment modality.
(2) Medical direction of staff in delivering services to a patient
during a dialysis session.
(3) Pre-dialysis and post-dialysis examinations, or examinations
that
[[Page 79]]
could have been furnished on a pre-dialysis or post-dialysis basis.
(4) Insertion of catheters for patients who are on peritoneal
dialysis and do not have indwelling catheters.
(e) Payment for routine professional services. Beginning August 7,
1990, routine professional services furnished by physicians may be paid
under either the ``initial method'' of payment described in Sec.
414.313, (if all of the physicians at the facility elect the initial
method) or under the ``physician MCP method'' described in Sec.
414.314. Physician services furnished after July 31, 1983 and before
August 6, 1990, are payable only under the MCP method described in Sec.
414.314.
Sec. 414.313 Initial method of payment.
(a) Basic rule. Under this method, the intermediary pays the
facility for routine professional services furnished by physicians.
Payment is in the form of an add-on to the facility's composite rate
payment, which is described in part 413, subpart H of this subchapter.
(b) Services for which payment is not included in the add-on
payment. (1) Physician administrative services are considered to be
facility services and are paid for as part of the facility's composite
rate.
(2) The carrier pays the physician or the beneficiary (as
appropriate) under the reasonable charge criteria set forth in subpart E
of part 405 of this chapter for the following services:
(i) Physician services that must be furnished at a time other than
during the dialysis session (excluding pre-dialysis and post-dialysis
examinations and examinations that could have been furnished on a pre-
dialysis or post-dialysis basis), such as monthly and semi-annual
examinations to review health status and treatment.
(ii) Physician surgical services other than insertion of catheters
for patients who are on peritoneal dialysis and do not have indwelling
catheters.
(iii) Physician services furnished to hospital inpatients who were
not admitted solely to receive maintenance dialysis.
(iv) Administration of hepatitis B vaccine.
(c) Physician election of the initial method. (1) Each physician in
a facility must submit to the appropriate carrier and intermediary that
serve the facility a statement of election of the initial method of
payment for all the ESRD facility patients that he or she attends.
(2) The initial method of payment applies to dialysis services
furnished beginning with the second calendar month after the month in
which all physicians in the facility elect the initial method and
continues until the effective date of a termination of the election
described in paragraph (d) of this section.
(d) Termination of the initial method. (1) Physicians may terminate
the initial method of payment by written notice to the carrier(s) that
serves each physician and to the intermediary that serves the facility.
(2) If the notice terminating the initial method is received by the
carrier(s) and intermediary--
(i) On or before November 1, the effective date of the termination
is January 1 of the year following the calendar year in which the
termination notice is received by the carrier(s) and intermediary; or
(ii) After November 1, the effective date of the termination is
January 1 of the second year after the calendar year in which the notice
is received by the carrier(s) and intermediary.
(e) Determination of payment amount. The factors used in determining
the add-on amount are related to program experience. They are re-
evaluated periodically and may be adjusted, as determined necessary by
CMS, to maintain the payment at a level commensurate with the prevailing
charges of other physicians for comparable services.
(f) Publication of payment amount. Revisions to the add-on amounts
are published in the Federal Register in accordance with the
Department's established rulemaking procedures.
[55 FR 23441, June 8, 1990, as amended at 62 FR 43674, Aug. 15, 1997]
Sec. 414.314 Monthly capitation payment method.
(a) Basic rules. (1) Under the monthly capitation payment (MCP)
method, the carrier pays an MCP amount for each patient, to cover all
professional services furnished by the physician, except
[[Page 80]]
those listed in paragraph (b) of this section.
(2) The carrier pays the MCP amount, subject to the deductible and
coinsurance provisions, either to the physician if the physician accepts
assignment or to the beneficiary if the physician does not accept
assignment.
(3) The MCP method recognizes the need of maintenance dialysis
patients for physician services furnished periodically over relatively
long periods of time, and the capitation amounts are consistent with
physicians' charging patterns in their localities.
(4) Payment of the capitation amount for any particular month is
contingent upon the physician furnishing to the patient all physician
services required by the patient during the month, except those listed
in paragraph (b) of this section.
(5) Payment for physician administrative services (Sec. 414.310) is
made to the dialysis facility as part of the facility's composite rate
(part 413, subpart H of this subchapter) and not to the physician under
the MCP.
(b) Services not included in the MCP. (1) Services that are not
included in the MCP and which may be paid in accordance with the
reasonable charge rules set forth in subpart E of part 405 of this
chapter are limited to the following:
(i) Administration of hepatitis B vaccine.
(ii) Covered physician services furnished by another physician when
the patient is not available to receive, or the attending physician is
not available to furnish, the outpatient services as usual (see
paragraph (b)(3) of this section).
(iii) Covered physician services furnished to hospital inpatients,
including services related to inpatient dialysis, by a physician who
elects not to continue to receive the MCP during the period of inpatient
stay.
(iv) Surgical services, including declotting of shunts, other than
the insertion of catheters for patients on maintenance peritoneal
dialysis who do not have indwelling catheters.
(v) Needed physician services that are--
(A) Furnished by the physician furnishing renal care or by another
physician;
(B) Not related to the treatment of the patient's renal condition;
and
(C) Not furnished during a dialysis session or an office visit
required because of the patient's renal condition.
(2) For the services described in paragraph (b)(1)(v) of this
section, the following rules apply:
(i) The physician must provide documentation to show that the
services are not related to the treatment of the patient's renal
condition and that additional visits are required.
(ii) The carrier's medical staff, acting on the basis of the
documentation and appropriate medical consultation obtained by the
carrier, determines whether additional payment for the additional
services is warranted.
(3) The MCP is reduced in proportion to the number of days the
patient is--
(i) Hospitalized and the physician elects to bill separately for
services furnished during hospitalization; or
(ii) Not attended by the physician or his or her substitute for any
reason, including when the physician is not available to furnish patient
care or when the patient is not available to receive care.
(c) Determination of payment amount. The amount of payment for the
MCP is determined under the Medicare physician fee schedule described in
this part 414.
[55 FR 23441, June 8, 1990, as amended at 59 FR 63463, Dec. 8, 1994; 62
FR 43674, Aug. 15, 1997]
Sec. 414.316 Payment for physician services to patients in training
for self-dialysis and home dialysis.
(a) For each patient, the carrier pays a flat amount that covers all
physician services required to create the capacity for self-dialysis and
home dialysis.
(b) CMS determines the amount on the basis of program experience and
reviews it periodically.
(c) The payment is made at the end of the training course, is
subject to the deductible and coinsurance provisions, and is in addition
to any amounts payable under the initial or MCP methods set forth in
Sec. Sec. 414.313 and 414.314, respectively.
[[Page 81]]
(d) If the training is not completed, the payment amount is
proportionate to the time spent in training.
Sec. 414.320 Determination of reasonable charges for physician
renal transplantation services.
(a) Comprehensive payment for services furnished during a 60-day
period. (1) The comprehensive payment is subject to the deductible and
coinsurance provisions and is for all surgeon services furnished during
a period of 60 days in connection with a renal transplantation,
including the usual preoperative and postoperative care, and for
immunosuppressant therapy if supervised by the transplant surgeon.
(2) Additional sums, in amounts established on the basis of program
experience, may be included in the comprehensive payment for other
surgery performed concurrently with the transplant operation.
(3) The amount of the comprehensive payment may not exceed the lower
of the following:
(i) The actual charges made for the services.
(ii) Overall national payment levels established under the ESRD
program and adjusted to give effect to variations in physician's charges
throughout the nation. (These adjusted amounts are the maximum
allowances in a carrier's service area for renal transplantation surgery
and related services by surgeons.)
(4) Maximum allowances computed under these instructions are revised
at the beginning of each calendar year to the extent permitted by the
lesser of the following:
(i) Changes in the economic index as described in Sec.
405.504(a)(3)(i) of this chapter.
(ii) Percentage changes in the weighted average of the carrier's
prevailing charges (before adjustment by the economic index) for--
(A) A unilateral nephrectomy; or
(B) Another medical or surgical service designated by CMS for this
purpose.
(b) Other payments. Payments for covered medical services furnished
to the transplant beneficiary by other specialists, as well as for
services by the transplant surgeon after the 60-day period covered by
the comprehensive payment, are made under the reasonable charge criteria
set forth in Sec. 405.502 (a) through (d) of this chapter. The payments
for physicians' services in connection with renal transplantations are
changed on the basis of program experience and the expected advances in
the medical art for this operation.
Sec. 414.330 Payment for home dialysis equipment, supplies,
and support services.
(a) Equipment and supplies--(1) Basic rule. Except as provided in
paragraph (a)(2) of this section, Medicare pays for home dialysis
equipment and supplies only under the prospective payment rates
established at Sec. 413.210.
(2) Exception for equipment and supplies furnished prior to January
1, 2011. If the conditions in subparagraphs (a)(2) (i) through (iv) of
this section are met, Medicare pays for home analysis equipment and
supplies on a reasonable charge basis in accordance with subpart E
(Criteria for Determination of Reasonable Charges; Reimbursement for
Services of Hospital Interns, Residents, and Supervising Physicians) of
part 405, but the amount of payment may not exceed the limit for
equipment and supplies in paragraph (c)(2) of this section.
(i) The patient elects to obtain home dialysis equipment and
supplies from a supplier that is not a Medicare approved dialysis
facility.
(ii) The patient certifies to CMS that he or she has only one
supplier for all home dialysis equipment and supplies. This
certification is made on CMS Form 382 (the ``ESRD Beneficiary
Selection'' form).
(iii) In writing, the supplier--
(A) Agrees to receive Medicare payment for home dialysis supplies
and equipment only on an assignment-related basis; and
(B) Certifies to CMS that it has a written agreement with one
Medicare approved dialysis facility or, if the beneficiary is also
entitled to military or veteran's benefits, one military or Veterans
Administration hospital, for each patient. (See part 494 of this chapter
for the requirements for a Medicare approved dialysis facility.) Under
the agreement, the facility or military or VA hospital agrees to the
following:
[[Page 82]]
(1) To furnish all home dialysis support services for each patient
in accordance with part 494 (Conditions for Coverage for End-Stage Renal
Disease Facilities) of this chapter. (Sec. 410.52 sets forth the scope
and conditions of Medicare Part B coverage of home dialysis services,
supplies, and equipment.)
(2) To furnish institutional dialysis services and supplies. (Sec.
410.50 sets forth the scope and conditions for Medicare Part B coverage
of institutional dialysis services and supplies.)
(3) To furnish dialysis-related emergency services.
(4) To arrange for a Medicare approved laboratory to perform
dialysis-related laboratory tests that are covered under the composite
rate established at Sec. 413.170 and to arrange for the laboratory to
seek payment from the facility. The facility then includes these
laboratory services in its claim for payment for home dialysis support
services.
(5) To arrange for a Medicare approved laboratory to perform
dialysis-related laboratory tests that are not covered under the
composite rate established at Sec. 413.170 and for which the laboratory
files a Medicare claim directly.
(6) To furnish all other necessary dialysis services and supplies
(that is, those which are not home dialysis equipment and supplies).
(7) To satisfy all documentation, recordkeeping and reporting
requirements in part 494 (Conditions for Coverage for End-Stage Renal
Disease Facilities) of this chapter. This includes maintaining a
complete medical record of ESRD related items and services furnished by
other parties. The facility must report, on the forms required by CMS or
the ESRD network, all data for each patient in accordance with subpart
U.
(iv) The facility with which the agreement is made must be located
within a reasonable distance from the patient's home (that is, located
so that the facility can actually furnish the needed services in a
practical and timely manner, taking into account variables like the
terrain, whether the patient's home is located in an urban or rural
area, the availability of transportation, and the usual distances
traveled by patients in the area to obtain health care services).
(C) Agrees to report to the ESRD facility providing support
services, at least every 45 days, all data (meaning information showing
what supplies and services were provided to the patient and when each
was provided) for each patient regarding services and items furnished to
the patient in accordance with Sec. 494.100(c)(2) of this chapter.
(b) Support services--(1) Basic rule. Except as provided in
paragraph (b)(2) of this section, Medicare pays for support services
only under the prospective payment rates established in Sec. 413.210 of
this chapter.
(2) Exception for home support services furnished prior to January
1, 2011. If the patient elects to obtain home dialysis equipment and
supplies from a supplier that is not an approved ESRD facility, Medicare
pays for support services, other than support services furnished by
military or VA hospitals referred to in paragraph (a)(2)(iii)(B) of this
section, under paragraphs (b)(2) (i) and (ii) of this section but in no
case may the amount of payment exceed the limit for support services in
paragraph (c)(1) of this section:
(i) For support services furnished by a hospital-based ESRD
facility, Medicare pays on a reasonable cost basis in accordance with
part 413 of this chapter.
(ii) For support services furnished by an independent ESRD facility,
Medicare pays on the basis of reasonable charges that are related to
costs and allowances that are reasonable when the services are furnished
in an effective and economical manner.
(c) Payment limits for support services, equipment and supplies, and
notification of changes to the payment limits apply prior to January 1,
2011 as follows:
(1) Support services. The amount of payment for home dialysis
support services is limited to the national average Medicare-allowed
charge per patient per month for home dialysis support services, as
determined by CMS, plus the median cost per treatment for all dialysis
facilities for laboratory tests included under the composite rate, as
determined by CMS, multiplied
[[Page 83]]
by the national average number of treatments per month.
(2) Equipment and supplies. Payment for home dialysis equipment and
supplies is limited to an amount equal to the result obtained by
subtracting the support services payment limit in paragraph (c)(1) of
this section from the amount (or, in the case of continuous cycling
peritoneal dialysis, 130 percent) of the national median payment as
determined by CMS that would have been made under the prospective
payment rates established in Sec. 413.170 of this chapter for hospital-
based facilities.
(3) Notification of changes to the payment limits. Updated data are
incorporated into the payment limits when the prospective payment rates
established at Sec. 413.170 of this chapter are updated, and changes
are announced by notice in the Federal Register without a public comment
period. Revisions of the methodology for determining the limits are
published in the Federal Register in accordance with the Department's
established rulemaking procedures.
[57 FR 54187, Nov. 17, 1992, as amended at 73 FR 20474, Apr. 15, 2008;
75 FR 49202, Aug. 12, 2010]
Sec. 414.335 Payment for EPO furnished to a home dialysis patient
for use in the home.
(a) Prior to January 1, 2011, payment for EPO used at home by a home
dialysis patient is made only to either a Medicare approved ESRD
facility or a supplier of home dialysis equipment and supplies.
Effective January 1, 2011, payment for EPO used at home by a home
dialysis patient is made only to a Medicare-approved ESRD facility in
accordance with the per treatment payment as defined in Sec. 413.230.
(b) After January 1, 2011, a home and self training amount is added
to the per treatment base rate for adult and pediatric patients as
defined in Sec. 413.230
[75 FR 49202, Aug. 12, 2010]
Subpart F_Competitive Bidding for Certain Durable Medical Equipment,
Prosthetics, Orthotics, and Supplies (DMEPOS)
Sec. 414.400 Purpose and basis.
This subpart implements competitive bidding programs for certain
DMEPOS items as required by sections 1847(a) and (b) of the Act.
[72 FR 18084, Apr. 10, 2007]
Sec. 414.402 Definitions.
For purposes of this subpart, the following definitions apply:
Affected party means a contract supplier that has been notified that
their DMEPOS CBP contract will be terminated for a breach of contract.
Bid means an offer to furnish an item or items for a particular
price and time period that includes, where appropriate, any services
that are directly related to the furnishing of the item or items.
Bidding entity means the entity whose legal business name is
identified in the ``Form A: Business Organization Information'' section
of the bid.
Breach of contract means any deviation from contract requirements,
including a failure to comply with a governmental agency or licensing
organization requirements, constitutes a breach of contract.
Competitive bidding area (CBA) means an area established by the
Secretary under this subpart.
Competitive bidding program means a program established under this
subpart within a designated CBA.
Composite bid means the bid submitted by the supplier for the lead
item in the product category.
Contract supplier means an entity that is awarded a contract by CMS
to furnish items under a competitive bidding program.
Corrective action plan (CAP) means a contract supplier's written
document with supporting information that describes the actions the
contract supplier will take within a specified timeframe to remedy a
breach of contract.
Covered document means a financial, tax, or other document required
to be submitted by a bidder as part of an
[[Page 84]]
original bid submission under a competitive acquisition program in order
to meet the required financial standards.
Covered document review date means the later of--
(1) The date that is 30 days before the final date for the closing
of the bid window; or
(2) The date that is 30 days after the opening of the bid window.
DMEPOS stands for durable medical equipment, prosthetics, orthotics,
and supplies.
Grandfathered item means all rented items within a product category
for which payment was made prior to the implementation of a competitive
bidding program to a grandfathered supplier that chooses to continue to
furnish the items in accordance with Sec. 414.408(j) of this subpart
and that fall within the following payment categories for competitive
bidding:
(1) An inexpensive or routinely purchased item described in Sec.
414.220 of this part.
(2) An item requiring frequent and substantial servicing, as
described in Sec. 414.222 of this part.
(3) Oxygen and oxygen equipment described in Sec. 414.226 of this
part.
(4) Other DME described in Sec. 414.229 of this part.
Grandfathered supplier means a noncontract supplier that chooses to
continue to furnish grandfathered items to a beneficiary in a CBA.
Hearing officer means an individual, who was not involved with the
CBIC recommendation to take action for a breach of a DMEPOS Competitive
Bidding Program contract, who is designated by CMS to review and make an
unbiased and independent recommendation when there is an appeal of CMS's
initial determination to take action for a breach of a DMEPOS
Competitive Bidding Program contract.
Hospital has the same meaning as in section 1861(e) of the Act.
Item means a product included in a competitive bidding program that
is identified by a HCPCS code, which may be specified for competitive
bidding (for example, a product when it is furnished through mail
order), or a combination of codes and/or modifiers, and includes the
services directly related to the furnishing of that product to the
beneficiary. Items that may be included in a competitive bidding program
are:
(1) Durable medical equipment (DME) other than class III devices
under the Federal Food, Drug and Cosmetic Act, as defined in Sec.
414.202 of this part and group 3 complex rehabilitative wheelchairs and
further classified into the following categories:
(i) Inexpensive or routinely purchased items, as specified in Sec.
414.220(a).
(ii) Items requiring frequent and substantial servicing, as
specified in Sec. 414.222(a).
(iii) Oxygen and oxygen equipment, as specified in Sec.
414.226(c)(1).
(iv) Other DME (capped rental items), as specified in Sec. 414.229.
(2) Supplies necessary for the effective use of DME other than
inhalation and infusion drugs.
(3) Enteral nutrients, equipment, and supplies.
(4) Off-the-shelf orthotics, which are orthotics described in
section 1861(s)(9) of the Act that require minimal self-adjustment for
appropriate use and do not require expertise in trimming, bending,
molding, assembling or customizing to fit a beneficiary.
Item weight is a number assigned to an item based on its beneficiary
utilization rate using national data when compared to other items in the
same product category.
Lead item is the item in a product category with multiple items with
the highest total nationwide Medicare allowed charges of any item in the
product category prior to each competition.
Mail order contract supplier is a contract supplier that furnishes
items through the mail to beneficiaries who maintain a permanent
residence in a competitive bidding area.
Mail order item means any item (for example, diabetic testing
supplies) shipped or delivered to the beneficiary's home, regardless of
the method of delivery.
Metropolitan Statistical Area (MSA) has the same meaning as that
given by the Office of Management and Budget.
Minimal self-adjustment means an adjustment that the beneficiary,
caretaker for the beneficiary, or supplier of
[[Page 85]]
the device can perform and does not require the services of a certified
orthotist (that is, an individual certified by either the American Board
for Certification in Orthotics and Prosthetics, Inc., or the Board for
Orthotist/Prosthetist Certification) or an individual who has
specialized training.
National mail order DMEPOS competitive bidding program means a
program whereby contracts are awarded to suppliers for the furnishing of
mail order items across the nation.
Nationwide competitive bidding area means a CBA that includes the
United States, its Territories, and the District of Columbia.
Nationwide mail order contract supplier means a mail order contract
supplier that furnishes items in a nationwide competitive bidding area.
Network means a group of small suppliers that form a legal entity to
provide competitively bid items throughout the entire CBA.
Noncontract supplier means a supplier that is not awarded a contract
by CMS to furnish items included in a competitive bidding program.
Non-mail order item means any item (for example, diabetic testing
supplies) that a beneficiary or caregiver picks up in person at a local
pharmacy or supplier storefront.
Parties to the hearing means the DMEPOS contract supplier and CMS.
Physician has the same meaning as in section 1861(r) of the Act.
Pivotal bid means the lowest composite bid based on bids submitted
by suppliers for a product category that includes a sufficient number of
suppliers to meet beneficiary demand for the items in that product
category.
Price inversion means any situation where the following occurs: One
item (HCPCS code) in a grouping of similar items (e.g., walkers, enteral
infusion pumps, or power wheelchairs) in a product category includes a
feature that another, similar item in the same product category does not
have (e.g., wheels, alarm, or Group 2 performance); the average of the
2015 fee schedule amounts (or initial, unadjusted fee schedule amounts
for subsequent years for new items) for the code with the feature is
higher than the average of the 2015 fee schedule amounts for the code
without the feature; and, following a competition, the SPA for the code
with the feature is lower than the SPA for the code without that
feature.
Product category means a grouping of related items that are used to
treat a similar medical condition.
Regional competitive bidding area means a CBA that consists of a
region of the United States, its Territories, and the District of
Columbia.
Regional mail order contract supplier means a mail order contract
supplier that furnishes items in a regional competitive bidding area.
Single payment amount means the allowed payment for an item
furnished under a competitive bidding program.
Small supplier means, a supplier that generates gross revenue of
$3.5 million or less in annual receipts including Medicare and non-
Medicare revenue.
Supplier means an entity with a valid Medicare supplier number,
including an entity that furnishes an item through the mail.
Total nationwide allowed services means the total number of services
allowed for an item furnished in all states, territories, and the
District of Columbia where Medicare beneficiaries reside and can receive
covered DMEPOS items and services.
Treating practitioner means a physician assistant, nurse
practitioner, or clinical nurse specialist, as those terms are defined
in section 1861(aa)(5) of the Act.
Weighted bid means the item weight multiplied by the bid price
submitted for that item.
[72 FR 18084, Apr. 10, 2007, as amended at 74 FR 2880, Jan. 16, 2009; 74
FR 62009, Nov. 25, 2009; 75 FR 73622, Nov. 29, 2010; 76 FR 70314, Nov.
10, 2011; 81 FR 77966, Nov. 4, 2016; 83 FR 21925, May 11, 2018; 83 FR
57072, Nov. 14, 2018]
Sec. 414.404 Scope and applicability.
(a) Applicability. Except as specified in paragraph (b) of this
section, this subpart applies to all suppliers that furnish the items
defined in Sec. 414.402 to beneficiaries, including providers,
physicians, treating practitioners, physical therapists, and
occupational therapists that furnish such items under Medicare Part B.
[[Page 86]]
(b) Exceptions. (1) Physicians, treating practitioners, and
hospitals may furnish certain types of competitively bid durable medical
equipment without submitting a bid and being awarded a contract under
this subpart, provided that all of the following conditions are
satisfied:
(i) The items furnished are limited to crutches, canes, walkers,
folding manual wheelchairs, blood glucose monitors, and infusion pumps
that are DME, and off-the-shelf (OTS) orthotics.
(ii) The items are furnished by the physician or treating
practitioner to his or her own patients as part of his or her
professional service or by a hospital to its own patients during an
admission or on the date of discharge.
(iii) The items are billed under a billing number assigned to the
hospital, physician, the treating practitioner (if possible), or a group
practice to which the physician or treating practitioner has reassigned
the right to receive Medicare payment.
(2) A physical therapist in private practice (as defined in Sec.
410.60(c) of this chapter) or an occupational therapist in private
practice (as defined in Sec. 410.59(c) of this chapter) may furnish
competitively bid off-the-shelf orthotics without submitting a bid and
being awarded a contract under this subpart, provided that the items are
furnished only to the therapist's own patients as part of the physical
or occupational therapy service.
(3) Payment for items furnished in accordance with paragraphs (b)(1)
and (b)(2) of this section will be paid in accordance with Sec.
414.408(a).
[72 FR 18084, Apr. 10, 2007, as amended at 74 FR 2880, Jan. 16, 2009; 75
FR 73623, Nov. 29, 2010; 76 FR 70314, Nov. 10, 2011]
Sec. 414.406 Implementation of programs.
(a) Implementation contractor. CMS designates one or more
implementation contractors for the purpose of implementing this subpart.
(b) Competitive bidding areas. CMS designates through program
instructions or by other means, such as the request for bids, each CBA
in which a competitive bidding program may be implemented under this
subpart.
(c) Revisions to competitive bidding areas. CMS may revise the CBAs
designated under paragraph (b) of this section.
(d) Competitively bid items. CMS designates the items that are
included in a competitive bidding program through program instructions
or by other means
(e) Claims processing. The Durable Medical Equipment Medicare
Administrative Contractor designated to process DMEPOS claims for a
particular geographic region also processes claims for items furnished
under a competitive bidding program in the same geographic region.
[71 FR 48409, Aug. 18, 2006, as amended at 72 FR 18085, Apr. 10, 2007]
Sec. 414.408 Payment rules.
(a) Payment basis. (1) The payment basis for an item furnished under
a competitive bidding program is 80 percent of the single payment amount
calculated for the item under Sec. 414.416 for the CBA in which the
beneficiary maintains a permanent residence.
(2) If an item that is included in a competitive bidding program is
furnished to a beneficiary who does not maintain a permanent residence
in a CBA, the payment basis for the item is 80 percent of the lesser of
the actual charge for the item, or the applicable fee schedule amount
for the item, as determined under subpart C or subpart D.
(b) No changes to the single payment amount. The single payment
amount calculated for each item under each competitive bidding program
is paid for the duration of the competitive bidding program and will not
be adjusted by any update factor.
(c) Payment on an assignment-related basis. Payment for an item
furnished under this subpart is made on an assignment-related basis.
(d) Applicability of advanced beneficiary notice. Implementation of
a program in accordance with this subpart does not preclude the use of
an advanced beneficiary notice.
(e) Requirement to obtain competitively bid items from a contract
supplier. (1) General rule. Except as provided in paragraph (e)(2) of
this section, all items that are included in a competitive bidding
program must be furnished
[[Page 87]]
by a contract supplier for that program.
(2) Exceptions. (i) A grandfathered supplier may furnish a
grandfathered item to a beneficiary in accordance with paragraph (j) of
this section.
(ii) Medicare may make a secondary payment for an item furnished by
a noncontract supplier that the beneficiary is required to use under his
or her primary insurance policy. The provisions of this paragraph do not
supersede Medicare secondary payer statutory and regulatory provisions,
including the Medicare secondary payment rules located in Sec. Sec.
411.32 and 411.33 of this subchapter, and payment will be calculated in
accordance with those rules.
(iii) If a beneficiary is outside of the CBA in which he or she
maintains a permanent residence, he or she may obtain an item from a--
(A) Contract supplier, if the beneficiary obtains the item in
another CBA and the item is included in the competitive bidding program
for that CBA; or
(B) Supplier with a valid Medicare billing number, if the
beneficiary obtains the item in an area that is not a CBA, or if the
beneficiary obtains the item in another CBA but the item is not included
in the competitive bidding program for that CBA.
(iv) A physician, treating practitioner, physical therapist in
private practice, occupational therapist in private practice, or
hospital may furnish an item in accordance with Sec. 414.404(b) of this
subpart.
(3) Unless paragraph (e)(2) of this section applies:
(i) Medicare will not make payment for an item furnished in
violation of paragraph (e)(1) of this section, and
(ii) A beneficiary has no financial liability to a noncontract
supplier that furnishes an item included in the competitive bidding
program for a CBA in violation of paragraph (e)(1) of this section,
unless the beneficiary has signed an advanced beneficiary notice.
(4) CMS separately designates the Medicare billing number of all
noncontract suppliers to monitor compliance with paragraphs (e)(1) and
(e)(2) of this section.
(f) Purchased equipment. (1) The single payment amounts for new
purchased durable medical equipment, including power wheelchairs that
are purchased when the equipment is initially furnished and enteral
nutrition equipment are calculated based on the bids submitted and
accepted for these items. For contracts entered into beginning on or
after January 1, 2011, payment on a lump sum purchase basis is only
available for power wheelchairs classified as complex rehabilitative
power wheelchairs.
(2) Payment for used purchased durable medical equipment and enteral
nutrition equipment is made in an amount equal to 75 percent of the
single payment amounts calculated for new purchased equipment under
paragraph (f)(1) of this section.
(g) Purchased supplies and orthotics. The single payment amounts for
the following purchased items are calculated based on the bids submitted
and accepted for the following items:
(1) Supplies used in conjunction with durable medical equipment.
(2) Enteral nutrients.
(3) Enteral nutrition supplies.
(4) OTS orthotics.
(h) Rented equipment--(1) Capped rental DME. Subject to the
provisions of paragraph (h)(2) of this section, payment for capped
rental durable medical equipment is made in an amount equal to 10
percent of the single payment amounts calculated for new durable medical
equipment under paragraph (f)(1) of this section for each of the first 3
months, and 7.5 percent of the single payment amounts calculated for
these items for each of the remaining months 4 through 13.
(2) For contracts entered into beginning on or after January 1,
2011, the monthly fee schedule amount for rental of power wheelchairs
equals 15 percent of the single payment amounts calculated for new
durable medical equipment under paragraph (f)(1) of this section for
each of the first 3 months, and 6 percent of the single payment amounts
calculated for these items for each of the remaining months 4 through
13.
(3) Additional payment to certain contract suppliers for capped
rental DME. (i) Except as specified in paragraph
[[Page 88]]
(h)(3)(ii) of this section, Medicare makes 13 monthly payments to a
contract supplier that furnishes capped rental durable medical equipment
to a beneficiary who would otherwise be entitled to obtain the item from
a grandfathered supplier under paragraph (j) of this section. Payment is
made using the methodology described in paragraph (h)(1) of this
section. The contract supplier must transfer title to the item to the
beneficiary on the first day that begins after the 13th continuous month
in which payments are made in accordance with this paragraph.
(ii) Medicare does not make payment to a contract supplier under
paragraph (h)(3)(i) of this section if the contract supplier furnishes
capped rental durable medical equipment to a beneficiary who previously
rented the equipment from another contract supplier.
(4) Maintenance and servicing of rented DME. Separate maintenance
and servicing payments are not made for any rented durable medical
equipment.
(5) Payment for rented enteral nutrition equipment. Payment for
rented enteral nutrition equipment is made in an amount equal to 10
percent of the single payment amounts calculated for new enteral
nutrition equipment under paragraph (f)(1) of this section for each of
the first 3 months, and 7.5 percent of the single payment amount
calculated for these items under paragraph (f)(1) of this section for
each of the remaining months 4 through 15. The contract supplier to
which payment is made in month 15 for furnishing enteral nutrition
equipment on a rental basis must continue to furnish, maintain and
service the equipment until a determination is made by the beneficiary's
physician or treating practitioner that the equipment is no longer
medically necessary.
(6) Maintenance and servicing of rented enteral nutrition equipment.
Payment for the maintenance and servicing of rented enteral nutrition
equipment beginning 6 months after 15 months of rental payments is made
in an amount equal to 5 percent of the single payment amounts calculated
for these items under paragraph (f)(1) of this section.
(7) Payment for inexpensive or routinely purchased durable medical
equipment. Payment for inexpensive or routinely purchased durable
medical equipment furnished on a rental basis is made in an amount equal
to 10 percent of the single payment amount calculated for new purchased
equipment.
(8) Payment amounts for rented DME requiring frequent and
substantial servicing--(i) General rule. Except as provided in paragraph
(h)(7)(ii) of this section, the single payment amounts for rented
durable medical equipment requiring frequent and substantial servicing
are calculated based on the rental bids submitted and accepted for the
furnishing of these items on a monthly basis.
(ii) Exception. The single payment amounts for continuous passive
motion exercise devices are calculated based on the bids submitted and
accepted for the furnishing of these items on a daily basis.
(i) Monthly payment amounts for oxygen and oxygen equipment--(1)
Basic payment amount. Subject to the provisions of paragraph (i)(2) of
this section, the single payment amounts for oxygen and oxygen equipment
are calculated based on the bids submitted and accepted for the
furnishing on a monthly basis of each of the five classes of oxygen and
oxygen equipment described in Sec. 414.226(c)(1).
(2) Additional payment to certain contract suppliers. (i) Except as
specified in paragraph (i)(2)(iii) of this section, Medicare makes
monthly payments to a contract supplier that furnishes oxygen equipment
to a beneficiary who would otherwise be entitled to obtain the item from
a grandfathered supplier under paragraph (j) of this section as follows:
(A) If Medicare made 26 or less monthly payments to the former
supplier, Medicare makes a monthly payment to the contract supplier for
up to the number of months equal to the difference between 36 and the
number of months for which payment was made to the former supplier.
(B) If Medicare made 27 or more monthly payments to the former
supplier, Medicare makes 10 monthly payments to the contract supplier.
[[Page 89]]
(ii) Payment is made using the methodology described in paragraph
(i)(1) of this section. On the first day after the month in which the
final rental payment is made under paragraph (i)(2)(i) of this section,
the contract supplier must transfer title of the oxygen equipment to the
beneficiary.
(iii) Medicare does not make payment to a contract supplier under
paragraph (i)(2) of this section if the contract supplier furnishes
oxygen equipment to a beneficiary who previously rented the equipment
from another contract supplier.
(j) Special rules for certain rented durable medical equipment and
oxygen and oxygen equipment--(1) Supplier election. (i) A supplier that
is furnishing durable medical equipment or is furnishing oxygen or
oxygen equipment on a rental basis to a beneficiary prior to the
implementation of a competitive bidding program in the CBA where the
beneficiary maintains a permanent residence may elect to continue
furnishing the item as a grandfathered supplier.
(ii) A supplier that elects to be a grandfathered supplier must
continue to furnish the grandfathered items to all beneficiaries who
elect to continue receiving the grandfathered items from that supplier
for the remainder of the rental period for that item.
(2) Payment for grandfathered items furnished during the first
competitive bidding program implemented in a CBA. Payment for
grandfathered items furnished during the first competitive bidding
program implemented in a CBA is made as follows:
(i) For inexpensive and routinely purchased items described in Sec.
414.220(a), payment is made in the amount determined under Sec.
414.220(b).
(ii) For other durable medical equipment or capped rental items
described in Sec. 414.229, payment is made in the amount determined
under Sec. 414.229(b).
(iii) For items requiring frequent and substantial servicing
described in Sec. 414.222, payment is made in accordance with paragraph
(a)(1) of this section.
(iv) For oxygen and oxygen equipment described in Sec.
414.226(c)(1), payment is made in accordance with paragraph (a)(1) of
this section.
(3) Payment for grandfathered items furnished during all subsequent
competitive bidding programs in a CBA. Beginning with the second
competitive bidding program implemented in a CBA, payment is made for
grandfathered items in accordance with paragraph (a)(1) of this section.
(4) Choice of suppliers. (i) Beneficiaries who are renting an item
that meets the definition of a grandfathered item in Sec. 414.402 of
this subpart may elect to obtain the item from a grandfathered supplier.
(ii) A beneficiary who is otherwise entitled to obtain a
grandfathered item from a grandfathered supplier under paragraph (j) of
this section may elect to obtain the same item from a contract supplier
at any time after a competitive bidding program is implemented.
(iii) If a beneficiary elects to obtain the same item from a
contract supplier, payment is made for the item accordance with
paragraph (a)(1) of this section.
(5) Notification of beneficiaries and CMS by suppliers that choose
to become grandfathered suppliers. (i) Notification of beneficiaries by
suppliers. (A) Requirements of notification. A noncontract supplier that
elects to become a grandfathered supplier must provide a 30-day written
notification to each Medicare beneficiary that resides in a competitive
bidding area and is currently renting a competitively bid item from that
supplier. The 30-day notification to the beneficiary must meet the
following requirements:
(1) Be sent by the supplier to the beneficiary at least 30 business
days before the start date of the implementation of the competitive
bidding program for the CBA in which the beneficiary resides.
(2) Identify the grandfathered items that the supplier is willing to
continue to rent to the beneficiary.
(3) Be in writing (for example, by letter or postcard) and the
supplier must maintain proof of delivery.
(4) State that the supplier is willing to continue to furnish
certain rented
[[Page 90]]
Durable Medical Equipment (DME), oxygen and oxygen equipment, and
supplies that the supplier is currently furnishing to the beneficiary
(that is, before the start of the competitive bidding program) and is
willing to continue to provide these items to the beneficiary for the
remaining rental months.
(5) State that the beneficiary has the choice to continue to receive
a grandfathered item(s) from the grandfathered supplier or may elect to
receive the item(s) from a contract supplier after the end of the last
month for which a rental payment is made to the noncontract supplier.
(6) Provide the supplier's telephone number and instruct the
beneficiary to call the supplier with any questions and to notify the
supplier of his or her decision to use or not use the supplier as a
grandfathered supplier.
(7) State that the beneficiary can obtain information about the
competitive bidding program by calling 1-800-MEDICARE or on the Internet
at http://www.Medicare.gov.
(B) Record of beneficiary's choice. The supplier should obtain an
election from the beneficiary regarding whether to use or not use the
supplier as a grandfathered supplier. The supplier must maintain a
record of its attempts to communicate with the beneficiary to obtain the
beneficiary's election regarding grandfathering. When the supplier
obtains such an election, the supplier must maintain a record of the
beneficiary decision including the date the choice was made, and how the
beneficiary communicated his or her choice to the supplier.
(C) Notification. If the beneficiary chooses not to continue to
receive a grandfathered item(s) from their current supplier, the
supplier must provide the beneficiary with 2 more notices in addition to
the 30-day notice prior to the supplier picking up its equipment.
(1) 10-day notification: Ten business days prior to picking up the
item, the supplier should have direct contact (for example, a phone
call) with the beneficiary or the beneficiary's caregiver and receive
acknowledgement that the beneficiary understands their equipment will be
picked up. This should occur on the first anniversary date after the
start of the CBP or on another date agreed to by the beneficiary or the
beneficiary's caregiver. The beneficiary's anniversary date occurs every
month and is the date of the month on which the item was first delivered
to the beneficiary by the current supplier. When a date other than the
anniversary date is chosen by the beneficiary or the beneficiary's
caregiver, the noncontract supplier will still receive payment up to the
anniversary date after the start of the CBP, and the new contract
supplier may not bill for any period of time before the anniversary
date.
(2) 2-day notification: Two business days prior to picking up the
item the supplier should contact the beneficiary or the beneficiary's
caregiver by phone to notify the beneficiary of the date the supplier
will pick up the item. This date should not be before the beneficiary's
first anniversary date that occurs after the start of the competitive
bidding program unless an alternative arrangement has been made with the
beneficiary and the new contract supplier.
(D) Pickup procedures. (1) The pickup of the noncontract supplier's
equipment and the delivery of the new contract supplier's equipment
should occur on the same date, that is, the first rental anniversary
date of the equipment that occurs after the start of the competitive
bidding program unless an alternative arrangement has been made with the
beneficiary and the new contract supplier.
(2) Under no circumstance should a supplier pick up a rented item
prior to the supplier's receiving acknowledgement from the beneficiary
that the beneficiary is aware of the date on which the supplier is
picking up the item and the beneficiary has made arrangements to have
the item replaced on that date by a contract supplier.
(3) When a beneficiary chooses to switch to a new contract supplier,
the current noncontract supplier and the new contract supplier must make
arrangements that are suitable to the beneficiary.
(4) The contract supplier may not submit a claim with a date of
delivery for the new equipment that is prior to
[[Page 91]]
the first anniversary date that occurs after the beginning of the CBP,
and the contract supplier may not begin billing until the first
anniversary date that occurs after the beginning of the CBP.
(5) The noncontract supplier must submit a claim to be paid up to
the first anniversary date that occurs after the beginning of the CBP.
Therefore, they should not pick up the equipment before that date unless
an alternative arrangement has been made with the beneficiary and the
new contract supplier.
(ii) Notification to CMS by suppliers. A noncontract supplier that
elects to become a grandfathered supplier must provide a written
notification to CMS of this decision. This notification must meet the
following requirements:
(A) State that the supplier agrees to continue to furnish certain
rented DME, oxygen and oxygen equipment that it is currently furnishing
to beneficiaries (that is, before the start of the competitive bidding
program) in a CBA and will continue to provide these items to these
beneficiaries for the remaining months of the rental period.
(B) Include the following information:
(1) Name and address of the supplier.
(2) The 6-digit NSC number of the supplier.
(3) Product category(s) by CBA for which the supplier is willing to
be a grandfathered supplier.
(C) State that the supplier agrees to meet all the terms and
conditions pertaining to grandfathered suppliers.
(D) Be provided by the supplier to CMS in writing at least 30
business days before the start date of the implementation of the
Medicare DMEPOS Competitive Bidding Program.
(6) Suppliers that choose not to become grandfathered suppliers. (i)
Requirement for non-grandfathered supplier. A noncontract supplier that
elects not to become a grandfathered supplier is required to pick up the
item it is currently renting to the beneficiary from the beneficiary's
home after proper notification.
(ii) Notification. Proper notification includes a 30-day, a 10-day,
and a 2-day notice of the supplier's decision not to become a
grandfathered supplier to its Medicare beneficiaries who are currently
renting certain DME competitively bid item(s) and who reside in a CBA.
(iii) Requirements of notification. These notifications must meet
all of the requirements listed in paragraph (j)(5)(i) of this section
for the 30-day, 10-day and 2-day notices that must be sent by suppliers
who decide to be grandfathered suppliers, with the following exceptions
for the 30-day notice.
(A) State that, for those items for which the supplier has decided
not to be a grandfathered supplier, the supplier will only continue to
rent these competitively bid item(s) to its beneficiaries up to the
first anniversary date that occurs after the start of the Medicare
DMEPOS Competitive Bidding Program.
(B) State that the beneficiary must select a contract supplier for
Medicare to continue to pay for these items.
(C) Refer the beneficiary to the contract supplier locator tool on
and to 1-800-MEDICARE to obtain information about the availability of
contract suppliers for the beneficiary's area.
(iv) Pickup procedures. (A) The pick-up of the noncontract
supplier's equipment and the delivery of the new contract supplier's
equipment should occur on the same date, that is, the first rental
anniversary date of the equipment that occurs after the start of the
competitive bidding program unless an alternative arrangement has been
made with the beneficiary and the new contract supplier.
(B) Under no circumstance should a supplier pick up a rented item
prior to the supplier's receiving acknowledgement from the beneficiary
that the beneficiary is aware of the date on which the supplier is
picking up the item and the beneficiary has made arrangements to have
the item replaced on that date by a contract supplier.
(C) When a beneficiary chooses to switch to a new contract supplier,
the current noncontract supplier and the new contract supplier must make
arrangements that are agreeable to the beneficiary.
(D) The contract supplier cannot submit a claim with a date of
delivery for the new equipment that is prior to the first anniversary
date that occurs after the beginning of the CBP.
[[Page 92]]
(7) Payment for accessories and supplies for grandfathered items.
Accessories and supplies that are used in conjunction with and are
necessary for the effective use of a grandfathered item may be furnished
by the same grandfathered supplier that furnishes the grandfathered
item. Payment is made in accordance with paragraph (a)(1) of this
section.
(k) Payment for maintenance, servicing and replacement of
beneficiary-owned items. (1) Payment is made for the maintenance and
servicing of beneficiary-owned items, provided the maintenance and
servicing is performed by a contract supplier or a noncontract supplier
having a valid Medicare billing number, as follows:
(i) Payment for labor is made in accordance with Sec. 414.210(e)(1)
of subpart D.
(ii) Payment for parts that are not items (as defined in Sec.
414.402) is made in accordance with Sec. 414.210(e)(1) of subpart D.
(iii) Payment for parts that are items (as defined in Sec. 414.402)
is made in accordance with paragraph (a)(1) of this section.
(2) Additional payments are made in accordance with Sec.
414.210(e)(2), (e)(3) and (e)(5) of this part for the maintenance and
servicing of oxygen equipment if performed by a contract supplier or a
noncontract supplier having a valid Medicare billing number.
(3) Beneficiaries must obtain a replacement of a beneficiary-owned
item, other than parts needed for the repair of beneficiary-owned
equipment from a contract supplier. Payment is made for the replacement
item in accordance with paragraph (a)(1) of this section.
(l) Exceptions for certain items and services paid in accordance
with special payment rules. The payment rules in paragraphs (f) thru
(h), (j)(2), (j)(3), and (j)(7), and (k) of this section do not apply to
items and services paid in accordance with the special payment rules at
Sec. 414.409.
[72 FR 18085, Apr. 10, 2007, as amended at 74 FR 2880, Jan. 16, 2009; 74
FR 62009, Nov. 25, 2009; 75 FR 73623, Nov. 29, 2010; 76 FR 70315, Nov.
10, 2011; 79 FR 66264, Nov. 6, 2014]
Sec. 414.409 Special payment rules.
(a) Payment on a bundled, continuous rental basis. In no more than
12 CBAs, in conjunction with competitions that begin after January 1,
2015, payment is made on a bundled, continuous monthly rental basis for
standard power wheelchairs and continuous positive airway pressure
(CPAP) devices. The CBAs and competitions where these payment rules
apply are announced in advance of each competition, with the payment
rules in this section used in lieu of the payment rules at Sec.
414.408(f) thru (h), (j)(2), (j)(3), and (j)(7), and (k). The single
payment amounts are established based on bids submitted and accepted for
furnishing rented standard power wheelchairs and CPAP devices on a
monthly basis for each month of medical need during the contract period.
The single payment amount for the monthly rental of the DME includes
payment for the rented equipment, maintenance and servicing of the
rented equipment, and replacement of supplies and accessories necessary
for the effective use of the rented equipment. Separate payment for
replacement of equipment, repair or maintenance and servicing of
equipment, or for replacement of accessories and supplies necessary for
the effective use of equipment is not allowed under any circumstance.
(b) Payment for grandfathered DME items paid on a bundled,
continuous rental basis. Payment to a supplier that elects to be a
grandfathered supplier of DME furnished in CBPs where these special
payment rules apply is made in accordance with Sec. 414.408(a)(1).
(c) Supplier transitions for DME paid on a bundled, continuous
rental basis. Changes from a non-contract supplier to a contract
supplier at the beginning of a CBP where payment is made on a bundled,
continuous monthly rental basis results in the contract supplier taking
on responsibility for meeting all of the monthly needs for furnishing
the covered DME. In the event that a beneficiary relocates from a CBA
where these special payment rules apply to an area where rental cap
rules apply, a new period of continuous use begins for the capped rental
item as long as the item is determined to be medically necessary.
(d) Responsibility for repair and maintenance and servicing of power
wheelchairs.
[[Page 93]]
In no more than 12 CBAs where payment for power wheelchairs is made on a
capped rental basis, for power wheelchairs furnished in conjunction with
competitions that begin after January 1, 2015, contract suppliers that
furnish power wheelchairs under contracts awarded based on these
competitions shall continue to repair power wheelchairs they furnish
following transfer of title to the equipment to the beneficiary. The
responsibility of the contract supplier to repair, maintain and service
beneficiary-owned power wheelchairs does not apply to power wheelchairs
that the contract supplier did not furnish to the beneficiary. For power
wheelchairs that the contract supplier furnishes during the contract
period, the responsibility of the contract supplier to repair, maintain
and service the power wheelchair once it is owned by the beneficiary
continues until the reasonable useful lifetime of the equipment expires,
coverage for the power wheelchair ends, or the beneficiary relocates
outside the CBA where the item was furnished. The contract supplier may
not charge the beneficiary or the program for any necessary repairs or
maintenance and servicing of a beneficiary-owned power wheelchair it
furnished during the contract period.
[79 FR 66264, Nov. 6, 2014]
Sec. 414.410 Phased-in implementation of competitive bidding programs.
(a) Phase-in of competitive bidding programs. CMS phases in
competitive bidding programs so that competition under the programs
occurs--
(1) In CY 2009, in Cincinnati--Middletown (Ohio, Kentucky and
Indiana), Cleveland--Elyria--Mentor (Ohio), Charlotte--Gastonia--Concord
(North Carolina and South Carolina), Dallas--Fort Worth--Arlington
(Texas), Kansas City (Missouri and Kansas), Miami--Fort Lauderdale--
Miami Beach (Florida), Orlando (Florida), Pittsburgh (Pennsylvania), and
Riverside--San Bernardino--Ontario (California).
(2) In CY 2011, in an additional 91 MSAs (the additional 70 MSAs
selected by CMS as of June 1, 2008, and the next 21 largest MSAs by
total population based on 2009 population estimates, and not already
phased in as of June 1, 2008). CMS may subdivide any of the 91 MSAs with
a population of greater than 8,000,000 into separate CBAs, thereby
resulting in more than 91 CBAs.
(3) After CY 2011, additional CBAs (or, in the case of national mail
order for items and services, after CY 2010).
(4) For competitions (other than for national mail order items and
services) after CY 2011 and prior to CY 2015, the following areas are
excluded:
(i) Rural areas.
(ii) MSAs not selected under paragraphs (a)(1) or (a)(2) of this
section with a population of less than 250,000.
(iii) An area with low population density within an MSA not selected
under paragraphs (a)(1) or (a)(2) of this section.
(b) Selection of MSAs for CY 2007 and CY 2009. CMS selects the MSAs
for purposes of designating CBAs in CY 2007 and CY 2009 by considering
the following variables:
(1) The total population of an MSA.
(2) The Medicare allowed charges for DMEPOS items per fee-for-
service beneficiary in an MSA.
(3) The total number of DMEPOS suppliers per fee-for-service
beneficiary who received DMEPOS items in an MSA.
(4) An MSA's geographic location.
(c) Exclusions from a CBA. CMS may exclude from a CBA a rural area
(as defined in Sec. 412.64(b)(1)(ii)(C) of this subchapter), or an area
with low population density based on one or more of the following
factors--
(1) Low utilization of DMEPOS items by Medicare beneficiaries
receiving fee-for-service benefits relative to similar geographic areas;
(2) Low number of DMEPOS suppliers relative to similar geographic
areas; or
(3) Low number of Medicare fee-for-service beneficiaries relative to
similar geographic areas.
(d) Selection of additional CBAs after CY 2009. (1) Beginning after
CY 2009, CMS designates through program instructions or by other means
additional CBAs based on CMS' determination that the implementation of a
competitive bidding program in a particular area would be likely to
result in significant savings to the Medicare program.
[[Page 94]]
(2) Beginning after CY 2009, CMS may designate through program
instructions or by other means a nationwide CBA or one or more regional
CBAs for purposes of implementing competitive bidding programs for items
that are furnished through the mail by nationwide or regional mail order
contract suppliers.
[72 FR 18085, Apr. 10, 2007, as amended at 74 FR 2880, Jan. 16, 2009; 75
FR 73623, Nov. 29, 2010; 76 FR 70315, Nov. 10, 2011]
Sec. 414.411 Special rule in case of competitions for diabetic
testing strips conducted on or after January 1, 2011.
(a) National mail order competitions. A supplier must demonstrate
that their bid submitted as part of a national mail order competition
for diabetic testing strips covers the furnishing of a sufficient number
of different types of diabetic testing strip products that, in the
aggregate, and taking into account volume for the different products,
includes at least 50 percent of all the different types of products on
the market. A type of diabetic testing strip means a specific brand and
model of testing strips.
(b) Other competitions. CMS may apply this special rule to non-mail
order or local competitions for diabetic testing strips.
[75 FR 73623, Nov. 29, 2010]
Sec. 414.412 Submission of bids under a competitive bidding program.
(a) Requirement to submit a bid. Except as provided under Sec.
414.404(b), in order for a supplier to receive payment for items
furnished to beneficiaries under a competitive bidding program, the
supplier must submit a bid to furnish those items and be awarded a
contract under this subpart.
(b) Grouping of items into product categories. (1) Composite bids,
as defined in Sec. 414.402, are submitted for lead items, as defined in
Sec. 414.402.
(2) The bid submitted for each lead item and product category cannot
exceed the payment amount that would otherwise apply to the lead item
under subpart C of this part, without the application of Sec.
414.210(g), or subpart D of this part, without the application of Sec.
414.105.
(3) The bids submitted for standard power wheelchairs paid in
accordance with the special payment rules at Sec. 414.409(a) cannot
exceed the average monthly payment for the bundle of items and services
that would otherwise apply to the item under subpart D of this part.
(4) The bids submitted for continuous positive airway pressure
(CPAP) devices paid in accordance with the special payment rules at
Sec. 414.409(a) cannot exceed the 1993 fee schedule amounts for these
items, increased by the covered item update factors provided for these
items in section 1834(a)(14) of the Act.
(5) Suppliers shall take into consideration the special payment
rules at Sec. 414.409(d) when submitting bids for furnishing power
wheelchairs under competitions where these rules apply.
(c) Furnishing of items. A bid must include all costs related to
furnishing all items in the product category, including all services
directly related to the furnishing of the items.
(d) Commonly-owned or controlled suppliers. (1) For purposes of this
paragraph--
(i) An ownership interest is the possession of equity in the
capital, stock or profits of another supplier;
(ii) A controlling interest exists if one or more of owners of a
supplier is an officer, director or partner in another supplier; and
(iii) Two or more suppliers are commonly-owned if one or more of
them has an ownership interest totaling at least 5 percent in the
other(s).
(2) A supplier must disclose in its bid each supplier in which it
has an ownership or controlling interest and each supplier which has an
ownership or controlling interest in it.
(3) Commonly-owned or controlled suppliers must submit a single bid
to furnish a product category in a CBA. Each commonly-owned or
controlled supplier that is located in the CBA for which the bid is
being submitted must be included in the bid. The bid must also include
any commonly-owned or controlled supplier that is located outside of the
CBA but would furnish the product category to the beneficiaries who
maintain a permanent residence in the CBA.
[[Page 95]]
(e) Mail order suppliers. (1) Suppliers that furnish items through
the mail must submit a bid to furnish these items in a CBA in which a
mail order competitive bidding program that includes the items is
implemented.
(2) Suppliers that submit one or more bids under (e)(1) of this
section may submit the same bid amount for each item under each
competitive bidding program for which it submits a bid.
(f) Applicability of the mail order competitive bidding program.
Suppliers that do not furnish items through the mail are not required to
participate in a nationwide or regional mail order competitive bidding
program that includes the same items. Suppliers may continue to furnish
these items in--
(1) A CBA, if the supplier is awarded a contract under this subpart;
or
(2) An area not designated as a CBA.
(g) Requiring bid surety bonds for bidding entities--(1) Bidding
requirements. For competitions beginning on or after January 1, 2017,
and no later than January 1, 2019, a bidding entity may not submit a
bid(s) for a CBA unless it obtains a bid surety bond for the CBA from an
authorized surety on the Department of the Treasury's Listing of
Certified Companies and provides proof of having obtained the bond by
submitting a copy to CMS by the deadline for bid submission.
(2) Bid surety bond requirements. (i) The bid surety bond issued
must include at a minimum:
(A) The name of the bidding entity as the principal/obligor;
(B) The name and National Association of Insurance Commissioners
number of the authorized surety;
(C) CMS as the named obligee;
(D) The conditions of the bond as specified in paragraph (g)(3) of
this section;
(E) The CBA covered by the bond;
(F) The bond number;
(G) The date of issuance; and
(H) The bid bond value of $50,000.00.
(ii) The bid surety bond must be maintained until it is either
collected upon due to forfeiture or the liability is returned for not
meeting bid forfeiture conditions.
(3) Forfeiture of bid surety bond. (i) When a bidding entity is
offered a contract for a CBA/product category (``competition'') and its
composite bid for the competition is at or below the median composite
bid rate for all bidding entities included in the calculation of the
single payment amounts within the competition and the bidding entity
does not accept the contract offer, its bid surety bond submitted for
that CBA will be forfeited and CMS will collect on the bond via
Electronic Funds Transfer (EFT) from the respective bonding company. As
one bid surety bond is required for each CBA in which the bidding entity
is submitting a bid, the failure to accept a contract offer for any
product category within the CBA when the entity's bid is at or below the
median composite bid rate will result in forfeiture of the bid surety
bond for that CBA.
(ii) Where the bid(s) does not meet the specified forfeiture
conditions in paragraph (h)(3)(i) of this section, the bid surety bond
liability will be returned within 90 days of the public announcement of
contract suppliers for the CBA. CMS will notify the bidding entity that
it did not meet the specified forfeiture requirements and the bid surety
bond will not be collected by CMS.
(4) Penalties. (i) A bidding entity that has been determined to have
falsified its bid surety bond may be prohibited from participation in
the DMEPOS Competitive Bidding Program for the current round of the
Competitive Bidding Program in which it submitted a bid and also from
participating in the next round of the Competitive Bidding Program.
Offending suppliers will also be referred to the Office of Inspector
General and Department of Justice for further investigation.
(ii) A bidding entity, whose composite bid is at or below the median
composite bid rate, that--
(A) Accepts a contract award; and
(B) Is found to be in breach of contract for nonperformance of the
contract to avoid forfeiture of the bid surety bond will have its
contract terminated and will be precluded from participation in the in
the next round of
[[Page 96]]
the DMEPOS Competitive Bidding Program.
[72 FR 18085, Apr. 10, 2007, as amended at 79 FR 66264, Nov. 6, 2014; 81
FR 77966, Nov. 4, 2016; 83 FR 21925, May 11, 2018; 83 FR 57072, Nov. 14,
2018]
Sec. 414.414 Conditions for awarding contracts.
(a) General rule. The rules set forth in this section govern the
evaluation and selection of suppliers for contract award purposes under
a competitive bidding program.
(b) Basic supplier eligibility. (1) Each supplier must meet the
enrollment standards specified in Sec. 424.57(c) of this chapter.
(2) Each supplier must disclose information about any prior or
current legal actions, sanctions, revocations from the Medicare program,
program-related convictions as defined in section 1128(a)(1) through
(a)(4) of the Act, exclusions or debarments imposed against it, or
against any members of the board of directors, chief corporate officers,
high-level employees, affiliated companies, or subcontractors, by any
Federal, State, or local agency. The supplier must certify in its bid
that this information is completed and accurate.
(3) Each supplier must have all State and local licenses required to
perform the services identified in the request for bids. CMS may not
award a contract to any entity in a CBA unless the entity meets
applicable State licensure requirements.
(4) Each supplier must submit a bona fide bid that complies with all
the terms and conditions contained in the request for bids.
(5) Each network must meet the requirements specified in Sec.
414.418.
(c) Quality standards and accreditation. Each supplier furnishing
items and services directly or as a subcontractor must meet applicable
quality standards developed by CMS in accordance with section
1834(a)(20) of the Act and be accredited by a CMS-approved organization
that meets the requirements of Sec. 424.58 of this subchapter, unless a
grace period is specified by CMS.
(d) Financial standards--(1) General rule. Each supplier must submit
along with its bid the applicable covered documents (as defined in Sec.
414.402) specified in the request for bids.
(2) Process for reviewing covered documents--(i) Submission of
covered documents for CMS review. To receive notification of whether
there are missing covered documents, the supplier must submit its
applicable covered documents by the later of the following covered
document review dates:
(A) The date that is 30 days before the final date for the closing
of the bid window; or
(B) The date that is 30 days after the opening of the bid window.
(ii) CMS feedback to a supplier with missing covered documents. (A)
For Round 1 bids. CMS has up to 45 days after the covered document
review date to review the covered documents and to notify suppliers of
any missing documents.
(B) For subsequent Round bids. CMS has 90 days after the covered
document review date to notify suppliers of any missing covered
documents.
(iii) Submission of missing covered documents. Suppliers notified by
CMS of missing covered documents have 10 business days after the date of
such notice to submit the missing documents. CMS does not reject the
supplier's bid on the basis that the covered documents are late or
missing if all the applicable missing covered documents identified in
the notice are submitted to CMS not later than 10 business days after
the date of such notice.
(e) Evaluation of bids. CMS evaluates composite bids submitted for a
lead item within a product category by--
(1) Calculating the expected beneficiary demand in the CBA for the
lead item in the product category;
(2) Calculating the total supplier capacity that would be sufficient
to meet the expected beneficiary demand in the CBA for the lead item in
the product category;
(3) Arraying the composite bids from the lowest composite bid price
to the highest composite bid price;
(4) Calculating the pivotal bid for the product category; and
(5) Selecting all suppliers and networks whose composite bids are
less than or equal to the pivotal bid for that product category, and
that meet
[[Page 97]]
the requirements in paragraphs (b) through (d) of this section.
(f) Expected savings. A contract is not awarded under this subpart
unless CMS determines that the amounts to be paid to contract suppliers
for an item under a competitive bidding program are expected to be less
than the amounts that would otherwise be paid for the same item under
subpart C or subpart D.
(g) Special rules for small suppliers--(1) Target for small supplier
participation. CMS ensures that small suppliers have the opportunity to
participate in a competitive bidding program by taking the following
steps:
(i) Setting a target number for small supplier participation by
multiplying 30 percent by the number of suppliers that meet the
requirements in paragraphs (b) through (d) of this section and whose
composite bids are equal to or lower than the pivotal bid calculated for
the product category;
(ii) Identifying the number of qualified small suppliers whose
composite bids are at or below the pivotal bid for the product category;
(iii) Selecting additional small suppliers whose composite bids are
above the pivotal bid for the product category in ascending order based
on the proximity of each small supplier's composite bid to the pivotal
bid, until the number calculated in paragraph (g)(1)(i) of this section
is reached or there are no more composite bids submitted by small
suppliers for the product category.
(2) The bids by small suppliers that are selected under paragraph
(g)(1)(iii) of this section are not used to calculate the single payment
amounts for any items under Sec. 414.416 of this subpart.
(h) Sufficient number of suppliers. (1) Except as provided in
paragraph (h)(3) of this section. CMS will award at least five
contracts, if there are five suppliers satisfying the requirements in
paragraphs (b) through (f) of this section; or
(2) CMS will award at least two contracts, if there are less than
five suppliers meeting these requirements and the suppliers satisfying
these requirements have sufficient capacity to satisfy beneficiary
demand for the product category calculated under paragraph (e)(1) of
this section.
(3) The provisions of paragraph (h)(1) of this section do not apply
to regional or nationwide mail order CBAs under Sec. 414.410(d)(2) of
this subpart.
(i) Selection of new suppliers after bidding. (1) Subsequent to the
awarding of contracts under this subpart, CMS may award additional
contracts if it determines that additional contract suppliers are needed
to meet beneficiary demand for items under a competitive bidding
program. CMS selects additional contract suppliers by--
(i) Referring to the arrayed list of suppliers that submitted bids
for the product category included in the competitive bidding program for
which beneficiary demand is not being met; and
(ii) Beginning with the supplier whose composite bid is the first
composite bid above the pivotal bid for that product category,
determining if that supplier is willing to become a contract supplier
under the same terms and conditions that apply to other contract
suppliers in the CBA.
(2) Before CMS awards additional contracts under paragraph (i)(1) of
this section, a supplier must submit updated information demonstrating
that the supplier meets the requirements under paragraphs (b) through
(d) of this section.
[72 FR 18085, Apr. 10, 2007, as amended at 74 FR 2880, Jan. 16, 2009; 76
FR 70315, Nov. 10, 2011; 79 FR 66264, Nov. 6, 2014; 81 FR 77967, Nov. 4,
2016; 83 FR 21925, May 11, 2018; 83 FR 57072, Nov. 14, 2018]
Sec. 414.416 Determination of competitive bidding payment amounts.
(a) General rule. CMS establishes a single payment amount for each
item furnished under a competitive bidding program.
(b) Methodology for setting payment amount. (1) The single payment
amount for a lead item furnished under a competitive bidding program is
equal to the maximum bid submitted for that item by suppliers whose
composite bids for the product category that includes the item are equal
to or below the pivotal bid for that product category.
(2) The single payment amount for a lead item must be less than or
equal to
[[Page 98]]
the amount that would otherwise be paid for the same item under subpart
C or subpart D of this part.
(3) The single payment amount for an item in a product category
furnished under a competitive bidding program that is not a lead item
for that product category is equal to the single payment amount for the
lead item in the same product category multiplied by the ratio of the
average of the 2015 fee schedule amounts for all areas (that is, all
states, the District of Columbia, Puerto Rico, the United States Virgin
Islands), for the item to the average of the 2015 fee schedule amounts
for all areas for the lead item.
[72 FR 18085, Apr. 10, 2007, as amended at 81 FR 77967, Nov. 4, 2016; 83
FR 57072, Nov. 14, 2018]
Sec. 414.418 Opportunity for networks.
(a) A network may be comprised of at least 2 but not more than 20
small suppliers.
(b) The following rules apply to networks that seek contracts under
this subpart:
(1) Each network must form a single legal entity that acts as the
bidder and submits the bid. Any agreement entered into for purposes of
forming a network must be submitted to CMS. The network must identify
itself as a network and identify all of its members.
(2) Each member of the network must satisfy the requirements in
Sec. 414.414(b) through (d).
(3) A small supplier may join one or more networks but cannot submit
an individual bid to furnish the same product category in the same CBA
as any network in which it is a member. A small supplier may not be a
member of more than one network if those networks submit bids to furnish
the same product category in the same CBA.
(4) The network cannot be anticompetitive, and this section does not
supersede any Federal law or regulation that regulates anticompetitive
behavior.
(5) A bid submitted by a network must include a statement from each
network member certifying that the network member joined the network
because it is unable independently to furnish all of the items in the
product category for which the network is submitting a bid to
beneficiaries throughout the entire geographic area of the CBA.
(6) At the time that a network submits a bid, the network's total
market share for each product category that is the subject of the
network's bid cannot exceed 20 percent of the Medicare demand for that
product category in the CBA.
(c) If the network is awarded a contract, each supplier must submit
its own claims and will receive payment directly from Medicare for the
items that it furnishes under the competitive bidding program.
[72 FR 18085, Apr. 10, 2007]
Sec. 414.420 Physician or treating practitioner authorization
and consideration of clinical efficiency and value of items.
(a) Prescription for a particular brand item or mode of delivery.
(1) A physician or treating practitioner may prescribe, in writing, a
particular brand of an item for which payment is made under a
competitive bidding program, or a particular mode of delivery for an
item, if he or she determines that the particular brand or mode of
delivery would avoid an adverse medical outcome for the beneficiary.
(2) When a physician or treating practitioner prescribes a
particular brand or mode of delivery of an item under paragraph (a)(1)
of this section, the physician or treating practitioner must document
the reason in the beneficiary's medical record why the particular brand
or mode of delivery is medically necessary to avoid an adverse medical
outcome.
(b) Furnishing of a prescribed particular brand item or mode of
delivery. If a physician or treating practitioner prescribes a
particular brand of an item or mode of delivery, the contract supplier
must--
(1) Furnish the particular brand or mode of delivery as prescribed
by the physician or treating practitioner;
(2) Consult with the physician or treating practitioner to find an
appropriate alternative brand of item or mode of delivery for the
beneficiary
[[Page 99]]
and obtain a revised written prescription from the physician or treating
practitioner; or
(3) Assist the beneficiary in locating a contract supplier that can
furnish the particular brand of item or mode of delivery prescribed by
the physician or treating practitioner.
(c) Payment for a particular brand of item or mode of delivery.
Medicare does not make an additional payment to a contract supplier that
furnishes a particular brand or mode of delivery for an item, as
directed by a prescription written by the beneficiary's physician or
treating practitioner.
(d) Prohibition on billing for an item different from the particular
brand of item or mode of delivery prescribed. A contract supplier is
prohibited from submitting a claim to Medicare if it furnishes an item
different from that specified in the written prescription received from
the beneficiary's physician or treating practitioner. Payment will not
be made to a contract supplier that submits a claim prohibited by this
paragraph.
[72 FR 18085, Apr. 10, 2007]
Sec. 414.422 Terms of contracts.
(a) Basic rule. CMS specifies the terms and conditions of the
contracts entered into with contract suppliers under this subpart. A
contract supplier must comply with all terms of its contract, including
any option exercised by CMS, for the full duration of the contract
period.
(b) Recompeting competitive bidding contracts. CMS recompetes
competitive bidding contracts at least once every 3 years.
(c) Nondiscrimination. The items furnished by a contract supplier
under this subpart must be the same items that the contract supplier
makes available to other customers.
(d) Change of ownership. (1) A contract supplier must notify CMS if
it is negotiating a change in ownership no later than 60 days before the
anticipated date of the change.
(2) CMS may transfer a contract to an entity that merges with, or
acquires, a contract supplier if the entity meets the following
requirements:
(i) A successor entity--
(A) Meets all requirements applicable to contract suppliers for the
applicable competitive bidding program;
(B) Submits to CMS the documentation described under Sec.
414.414(b) through (d) if documentation has not previously been
submitted by the successor entity or if the documentation is no longer
sufficient for CMS to make a financial determination. A successor entity
is not required to duplicate previously submitted information if the
previously submitted information is not needed to make a financial
determination. This documentation must be submitted no later than 30
days prior to the anticipated effective date of the change of ownership;
and
(C) Submits to CMS, at least 30 days before the anticipated
effective date of the change of ownership, a signed novation agreement
acceptable to CMS stating that it will assume all obligations under the
contract; or
(ii) A new entity--
(A) Meets the requirements of (d)(2)(i)(A) and (B) of this section;
and
(B) Contract supplier submits to CMS, at least 30 days before the
anticipated effective date of the change of ownership, its final draft
of a novation agreement as described in paragraph (d)(2)(C) of this
section for CMS review. The new entity submits to CMS, within 30 days
after the effective date of the change of ownership, an executed
novation agreement acceptable to CMS.
(3) Except as specified in paragraph (d) (4) of this section, CMS
transfers the entire contract, including all product categories and
competitive bidding areas, to a new qualified entity.
(4) For contracts issued in the Round 2 Recompete and subsequent
rounds in the case of a CHOW where a contract supplier sells a distinct
company, (e.g., an affiliate, subsidiary, sole proprietor, corporation,
or partnership) that furnishes a specific product category or services a
specific CBA, CMS may transfer the portion of the contract performed by
that company to a new qualified entity, if the following conditions are
met:
(i) Every CBA, product category, and location of the company being
sold must be transferred to the new qualified owner who meets all
competitive
[[Page 100]]
bidding requirements; i.e. financial, accreditation and licensure;
(ii) All CBAs and product categories in the original contract that
are not explicitly transferred by CMS remain unchanged in that original
contract for the duration of the contract period unless transferred by
CMS pursuant to a subsequent CHOW;
(iii) All requirements of paragraph (d)(2) of this section are met;
and
(iv) The sale of the distinct company includes all of the contract
supplier's assets associated with the CBA and/or product category(s);
and
(v) CMS determines that transfer of part of the original contract
will not result in disruption of service or harm to beneficiaries.
(e) Furnishing of items. Except as otherwise prohibited under
section 1877 of the Act, or any other applicable law or regulation:
(1) A contract supplier must agree to furnish items under its
contract to any beneficiary who maintains a permanent residence in, or
who visits, the CBA and who requests those items from that contract
supplier.
(2) A skilled nursing facility defined under section 1819(a) of the
Act or a nursing facility defined under section 1919(a) of the Act that
has elected to furnish items only to its own residents and that is also
a contract supplier may furnish items under a competitive bidding
program to its own patients to whom it would otherwise furnish Part B
services.
(3) Contract suppliers for diabetic testing supplies must furnish
the brand of diabetic testing supplies that work with the home blood
glucose monitor selected by the beneficiary. The contract supplier is
prohibited from influencing or incentivizing the beneficiary by
persuading, pressuring, or advising them to switch from their current
brand or for new beneficiaries from their preferred brand of glucose
monitor and testing supplies. The contract supplier may not furnish
information about alternative brands to the beneficiary unless the
beneficiary requests such information.
(f) Disclosure of subcontracting arrangements. (1) Initial
disclosure. Not later than 10 days after the date a supplier enters into
a contract under this section the supplier must disclose information on
both of the following:
(i) Each subcontracting arrangement that the supplier has in
furnishing items and services under the contract.
(ii) Whether each subcontractor meets the requirement of section
1834(a)(20)(F)(i) of the Act if applicable to such subcontractor.
(2) Subsequent disclosure. Not later than 10 days after the date a
supplier enters into a subcontracting arrangement subsequent to contract
award with CMS, the supplier must disclose information on both of the
following:
(i) The subcontracting arrangement that the supplier has in
furnishing items and services under the contract.
(ii) Whether the subcontractor meets the requirement of section
1834(a)(20)(F)(i) of the Act, if applicable to such subcontractor.
(g) Breach of contract. (1) Any deviation from contract
requirements, including a failure to comply with governmental agency or
licensing organization requirements, constitutes a breach of contract.
(2) In the event a contract supplier breaches its contract, CMS may
take one or more of the following actions, which will be specified in
the notice of breach of contract:
(i) Suspend the contract supplier's contract;
(ii) Terminate the contract;
(iii) Preclude the contract supplier from participating in the
competitive bidding program; or
(iv) Avail itself of other remedies allowed by law.
[72 FR 18085, Apr. 10, 2007, as amended at 74 FR 2881, Jan. 16, 2009; 75
FR 73623, Nov. 29, 2010; 76 FR 70315, Nov. 10, 2011; 79 FR 66264, Nov.
6, 2014; 81 FR 77967, Nov. 4, 2016; 83 FR 57073, Nov. 14, 2018]
Sec. 414.423 Appeals process for breach of a DMEPOS
competitive bidding program contract actions.
This section implements an appeals process for suppliers that CMS
has determined are in breach of their Medicare DMEPOS Competitive
Bidding Program contract and where CMS has issued a notice of breach of
contract indicating its intent to take action(s) pursuant to Sec.
414.422(g)(2).
[[Page 101]]
(a) Breach of contract. CMS may take one or more of the actions
specified in Sec. 414.422(g)(2) as a result of a supplier's breach of
their DMEPOS Competitive Bidding Program contract.
(b) Notice of breach of contract--(1) CMS notification. If CMS
determines a supplier to be in breach of its contract, it will notify
the supplier of the breach of contract in a notice of breach of
contract.
(2) Content of the notice of breach of contract. The CMS notice of
breach of contract will include the following:
(i) The details of the breach of contract.
(ii) The action(s) that CMS is taking as a result of the breach of
the contract pursuant to Sec. 414.422(g)(2), and the duration of or
timeframe(s) associated with the action(s), if applicable.
(iii) The right to request a hearing by a CBIC hearing officer and,
depending on the nature of the breach, the supplier may also be allowed
to submit a corrective action plan (CAP) in lieu of requesting a hearing
by a CBIC hearing officer, as specified in paragraph (c)(1)(i) of this
section.
(iv) The address to which the written request for a hearing must be
submitted.
(v) The address to which the CAP must be submitted, if applicable.
(vi) The effective date of the action(s) that CMS is taking is the
date specified by CMS in the notice of breach of contract, or 45 days
from the date of the notice of breach of contract unless:
(A) A timely hearing request has been filed; or
(B) A CAP has been submitted within 30 days of the date of the
notice of breach of contract where CMS allows a supplier to submit a
CAP.
(c) Corrective action plan (CAP)--(1) Option for a CAP. (i) CMS has
the option to allow a supplier to submit a written CAP to remedy the
deficiencies identified in the notice at its sole discretion, including
where CMS determines that the delay in the effective date of the breach
of contract action(s) caused by allowing a CAP will not cause harm to
beneficiaries. CMS will not allow a CAP if the supplier has been
excluded from any Federal program, debarred by a Federal agency, or
convicted of a healthcare-related crime, or for any other reason
determined by CMS.
(ii) If a supplier chooses not to submit a CAP, if CMS determines
that a supplier's CAP is insufficient, or if CMS does not allow the
supplier the option to submit a CAP, the supplier may request a hearing
on the breach of contract action(s).
(2) Submission of a CAP. (i) If allowed by CMS, a CAP must be
submitted within 30 days from the date on the notice of breach of
contract. If the supplier decides not to submit a CAP the supplier may,
within 30 days of the date on the notice, request a hearing by a CBIC
hearing officer.
(ii) Suppliers will have the opportunity to submit a CAP when they
are first notified that they have been determined to be in breach of
contract. If the CAP is not acceptable to CMS or is not properly
implemented, suppliers will receive a subsequent notice of breach of
contract. The subsequent notice of breach of contract may, at CMS'
discretion, allow the supplier to submit another written CAP pursuant to
paragraph (c)(1)(i) of this section.
(d) The purpose of the CAP. The purpose of the CAP is:
(1) For the supplier to remedy all of the deficiencies that were
identified in the notice of breach of contract.
(2) To identify the timeframes by which the supplier will implement
each of the components of the CAP.
(e) Review of the CAP. (1) The CBIC will review the CAP. Suppliers
may only revise their CAP one time during the review process based on
the deficiencies identified by the CBIC. The CBIC will submit a
recommendation to CMS for each applicable breach of contract action
concerning whether the CAP includes the steps necessary to remedy the
contract deficiencies as identified in the notice of breach of contract.
(2) If CMS accepts the CAP, including the supplier's designated
timeframe for its completion, the supplier must provide a follow-up
report within 5 days after the supplier has fully implemented the CAP
that verifies that all of the deficiencies identified in the CAP have
been corrected in accordance with the timeframes accepted by CMS.
[[Page 102]]
(3) If the supplier does not implement a CAP that was accepted by
CMS, or if CMS does not accept the CAP submitted by the supplier, then
the supplier will receive a subsequent notice of breach of contract, as
specified in paragraph (b) of this section.
(f) Right to request a hearing by the CBIC Hearing Officer. (1) A
supplier who receives a notice of breach of contract (whether an initial
notice of breach of contract or a subsequent notice of breach of
contract under Sec. 414.422(e)(3)) has the right to request a hearing
before a CBIC hearing officer who was not involved with the original
breach of contract determination.
(2) A supplier that wishes to appeal the breach of contract
action(s) specified in the notice of breach of contract must submit a
written request to the CBIC. The request for a hearing must be received
by the CBIC within 30 days from the date of the notice of breach of
contract.
(3) A request for hearing must be in writing and submitted by an
authorized official of the supplier.
(4) The appeals process for the Medicare DMEPOS Competitive Bidding
Program is not to be used in place of other existing appeals processes
that apply to other parts of Medicare.
(5) If the supplier is given the opportunity to submit a CAP and a
CAP is not submitted and the supplier fails to timely request a hearing,
the breach of contract action(s) will take effect 45 days from the date
of the notice of breach of contract.
(g) The CBIC Hearing Officer schedules and conducts the hearing. (1)
Within 30 days from the receipt of the supplier's timely request for a
hearing the hearing officer will contact the parties to schedule the
hearing.
(2) The hearing may be held in person or by telephone at the
parties' request.
(3) The scheduling notice to the parties must indicate the time and
place for the hearing and must be sent to the parties at least 30 days
before the date of the hearing.
(4) The hearing officer may, on his or her own motion, or at the
request of a party, change the time and place for the hearing, but must
give the parties to the hearing 30 days' notice of the change.
(5) The hearing officer's scheduling notice must provide the parties
to the hearing the following information:
(i) A description of the hearing procedure.
(ii) The specific issues to be resolved.
(iii) The supplier has the burden to prove it is not in violation of
the contract or that the breach of contract action(s) is not
appropriate.
(iv) The opportunity for parties to the hearing to submit additional
evidence to support their positions, if requested by the hearing
officer.
(v) A notification that all evidence submitted, both from the
supplier and CMS, will be provided in preparation for the hearing to all
affected parties at least 15 days prior to the scheduled date of the
hearing.
(h) Burden of proof and evidence submission. (1) The burden of proof
is on the Competitive Bidding Program contract supplier to demonstrate
to the hearing officer with convincing evidence that it has not breached
its contract or that the breach of contract action(s) is not
appropriate.
(2) The supplier's evidence must be submitted with its request for a
hearing.
(3) If the supplier fails to submit the evidence at the time of its
submission, the Medicare DMEPOS supplier is precluded from introducing
new evidence later during the hearing process, unless permitted by the
hearing officer.
(4) CMS also has the opportunity to submit evidence to the hearing
officer within 10 days of receiving the scheduling notice.
(5) The hearing officer will share all evidence submitted by the
supplier and/or CMS, with all parties to the hearing at least 15 days
prior to the scheduled date of the hearing.
(i) Role of the hearing officer. The hearing officer will conduct a
thorough and independent review of the evidence including the
information and documentation submitted for the hearing and other
information that the hearing officer considers pertinent for the
hearing. The role of the hearing officer includes, at a minimum, the
following:
(1) Conduct the hearing and decide the order in which the evidence
and the arguments of the parties are presented;
[[Page 103]]
(2) Determine the rules on admissibility of the evidence;
(3) Examine the witnesses, in addition to the examinations conducted
by CMS and the contract supplier;
(4) The CBIC may assist CMS in the appeals process including being
present at the hearing, testifying as a witness, or performing other,
related ministerial duties;
(5) Determine the rules for requesting documents and other evidence
from other parties;
(6) Ensure a complete record of the hearing is made available to all
parties to the hearing;
(7) Prepare a file of the record of the hearing which includes all
evidence submitted as well as any relevant documents identified by the
hearing officer and considered as part of the hearing; and
(8) Comply with all applicable provisions of Title 18 and related
provisions of the Act, the applicable regulations issued by the
Secretary, and manual instructions issued by CMS.
(j) Hearing officer recommendation. (1) The hearing officer will
issue a written recommendation(s) to CMS within 30 days of the close of
the hearing unless an extension has been granted by CMS because the
hearing officer has demonstrated that an extension is needed due to the
complexity of the matter or heavy workload. In situations where there is
more than one breach of contract action presented at the hearing, the
hearing officer will issue separate recommendations for each breach of
contract action.
(2) The recommendation(s) will explain the basis and the rationale
for the hearing officer's recommendation(s).
(3) The hearing officer must include the record of the hearing,
along with all evidence and documents produced during the hearing along
with its recommendation(s).
(k) CMS' final determination. (1) CMS' review of the hearing
officer's recommendation(s) will not allow the supplier to submit new
information.
(2) After reviewing the hearing officer's recommendation(s), CMS'
decision(s) will be made within 30 days from the date of receipt of the
hearing officer's recommendation(s). In situations where there is more
than one breach of contract action presented at the hearing, and the
hearing officer issues multiple recommendations, CMS will render
separate decisions for each breach of contract action.
(3) A notice of CMS' decision will be sent to the supplier and the
hearing officer. The notice will indicate:
(i) If any breach of contract action(s) included in the notice of
breach of contract, specified in paragraph (b)(1) of this section, still
apply and will be effectuated, and
(ii) The effective date for any breach of contract action specified
in paragraph (k)(3)(i) of this section.
(4) This decision(s) is final and binding.
(l) Effect of breach of contract action(s)--(1) Effect of contract
suspension. (i) All locations included in the contract cannot furnish
competitive bid items to beneficiaries within a CBA and the supplier
cannot be reimbursed by Medicare for these items for the duration of the
contract suspension.
(ii) The supplier must notify all beneficiaries who are receiving
rented competitive bid items or competitive bid items on a recurring
basis of the suspension of their contract.
(A) The notice to the beneficiary from the supplier must be provided
within 15 days of receipt of the final notice.
(B) The notice to the beneficiary must inform the beneficiary that
they must select a new contract supplier to furnish these items in order
for Medicare to pay for these items.
(2) Effect of contract termination. (i) All locations included in
the contract can no longer furnish competitive bid items to
beneficiaries within a CBA and the supplier cannot be reimbursed by
Medicare for these items after the effective date of the termination.
(ii) The supplier must notify all beneficiaries, who are receiving
rented competitive bid items or competitive bid items received on a
recurring basis, of the termination of their contract.
(A) The notice to the beneficiary from the supplier must be provided
within 15 days of receipt of the final notice of termination.
(B) The notice to the beneficiary must inform the beneficiary that
they
[[Page 104]]
are going to have to select a new contract supplier to furnish these
items in order for Medicare to pay for these items.
(3) Effect of preclusion. A supplier who is precluded will not be
allowed to participate in a specific round of the Competitive Bidding
Program, which will be identified in the original notice of breach of
contract, as specified in paragraph (b)(1) of this section.
(4) Effect of other remedies allowed by law. If CMS decides to
impose other remedies under Sec. 414.422(g)(2)(iv), the details of the
remedies will be included in the notice of breach of contract, as
specified in paragraph (b)(2) of this section.
[81 FR 77967, Nov. 4, 2016, as amended at 83 FR 57073, Nov. 14, 2018]
Sec. 414.424 Administrative or judicial review.
(a) There is no administrative or judicial review under this subpart
of the following:
(1) Establishment of payment amounts.
(2) Awarding of contracts.
(3) Designation of CBAs.
(4) Phase-in of the competitive bidding programs.
(5) Selection of items for competitive bidding.
(6) Bidding structure and number of contract suppliers selected for
a competitive bidding program.
(b) A denied claim is not appealable if the denial is based on a
determination by CMS that a competitively bid item was furnished in a
CBA in a manner not authorized by this subpart.
[72 FR 18085, Apr. 10, 2007]
Sec. 414.425 Claims for damages.
(a) Eligibility for filing a claim for damages as a result of the
termination of supplier contracts by the Medicare Improvements for
Patients and Providers Act of 2008 (MIPPA). (1) Any aggrieved supplier,
including a member of a network that was awarded a contract for the
Round 1 Durable Medical Prosthetics, Orthotics, and Supplies Competitive
Bidding Program (DMEPOS CBP) that believes it has been damaged by the
termination of its competitive bid contract, may file a claim under this
section.
(2) A subcontractor of a contract supplier is not eligible to submit
a claim under this section.
(b) Timeframe for filing a claim. (1) A completed claim, including
all documentation, must be filed within 90 days of January 1, 2010 (the
effective date of these damages provisions), unless that day is a
Federal holiday or Sunday in which case it will fall to the next
business day.
(2) The date of filing is the actual date of receipt by the CBIC of
a completed claim that includes all the information required by this
rule.
(c) Information that must be included in a claim. (1) Supplier's
name, name of authorized official, U.S. Post Office mailing address,
phone number, email address and bidding number, and National Supplier
Clearinghouse Number;
(2) A copy of the signed contract entered into with CMS for the
Round 1 DMEPOS Competitive Bidding Program;
(3) A detailed explanation of the damages incurred by this supplier
as a direct result of the termination of the Round 1 competitive bid
contract by MIPPA. The explanation must include all of the following:
(i) Documentation of the supplier's damages through receipts.
(ii) Records that substantiate the supplier's damages and
demonstrate that the damages are directly related to performance of the
Round 1 contract and are consistent with information the supplier
provided as part of their bid.
(4) The supplier must explain how it would be damaged if not
reimbursed.
(5) The claim must document steps the supplier took to mitigate any
damages they may have incurred due to the contract termination,
including a detailed explanation of the steps of all attempts to use for
other purposes, return or dispose of equipment or other assets purchased
or rented for the use in the Round 1 DMEPOS CBP contract performance.
(d) Items that will not be considered in a claim. The following
items will not be considered in a claim:
(1) The cost of submitting a bid.
[[Page 105]]
(2) Any fees or costs incurred for consulting or marketing.
(3) Costs associated with accreditation or licensure.
(4) Costs incurred before March 20, 2008.
(5) Costs incurred for contract performance after July 14, 2008
except for costs incurred to mitigate damages.
(6) Any profits a supplier may have expected from the contract.
(7) Costs that would have occurred without a contract having been
awarded.
(8) Costs for items such as inventory, delivery vehicles, office
space and equipment, personnel, which the supplier did not purchase
specifically to perform the contract.
(9) Costs that the supplier has recouped by any means, and may
include use of personnel, material, suppliers, or equipment in the
supplier's business operations.
(e) Filing a claim. (1) A claim, with all supporting documentation,
must be filed with the CMS Competitive Bidding Implementation Contractor
(CBIC).
(2) Claims must include a statement from a supplier's authorized
official certifying the accuracy of the information provided on the
claim and all supporting documentation.
(3) The CBIC does not accept electronic submissions of claims for
damages.
(f) Review of claim. (1) Role of the CBIC. (i) The CBIC will review
the claim to ensure it is submitted timely, complete, and by an eligible
claimant. When the CBIC identifies that a claim is incomplete or not
filed timely, it will make a recommendation to the Determining Authority
not to process the claim further. Incomplete or untimely claims may be
dismissed by the Determining Authority without further processing.
(ii) For complete, timely claims, the CBIC will review the claim on
its merits to determine if damages are warranted and may seek further
information from the claimant when making its recommendation to the
Determining Authority. The CBIC may set a deadline for receipt of
additional information. A claimant's failure to respond timely may
result in a denial of the claim.
(iii) The CBIC will make a recommendation to the Determining
Authority for each claim filed and include an explanation that supports
its recommendation.
(iv) The recommendation must be either to award damages for a
particular amount (which may not be the same amount requested by the
claimant) or that no damages should be awarded.
(A) If the CBIC recommends that damages are warranted, the CBIC will
calculate a recommended reasonable amount of damages based on the claim
submitted.
(B) The reasonable amount will consider both costs incurred and the
contractor's attempts and action to limit the damages;
(v) The recommendation will be sent to the Determining Authority for
a final determination.
(2) CMS' role as the Determining Authority. (i) The Determining
Authority shall review the recommendation of the CBIC.
(ii) The Determining Authority may seek further information from the
claimant or the CBIC in making a concurrence or non-concurrence
determination.
(iii) The Determining Authority may set a deadline for receipt of
additional information. A claimant's failure to respond timely may
result in a denial of the claim.
(iv) If the Determining Authority concurs with the CBIC
recommendation, the Determining Authority shall submit a final signed
decision to the CBIC and direct the CBIC to notify the claimant of the
decision and the reasons for the final decision.
(v) If the Determining Authority non-concurs with the CBIC
recommendation, the Determining Authority may return the claim for
further processing or the Determining Authority may:
(A) Write a determination granting (in whole or in part) a claim for
damages or denying a claim in its entirety;
(B) Direct the CBIC to write said determination for the Determining
Authority's signature; or
(C) Return the claim to the CBIC with further instructions.
[[Page 106]]
(vi) The Determining Authority's determination is final and not
subject to administrative or judicial review.
(g) Timeframe for determinations. (1) Every effort will be made to
make a determination within 120 days of initial receipt of the claim for
damages by the CBIC or the receipt of additional information that was
requested by the CBIC, whichever is later.
(2) In the case of more complex cases, or in the event of a large
workload, a decision will be issued as soon as practicable.
(h) Notification to claimant of damage determination. The CBIC must
mail the Determining Authority's determination to the claimant by
certified mail return receipt requested, at the address provided in the
claim.
[74 FR 62011, Nov. 25, 2009]
Sec. 414.426 Adjustments to competitively bid payment amounts
to reflect changes in the HCPCS.
If a HCPCS code for a competitively bid item is revised after the
contract period for a competitive bidding program begins, CMS adjusts
the single payment amount for that item as follows:
(a) If a single HCPCS code for an item is divided into two or more
HCPCS codes for the components of that item, the sum of single payment
amounts for the new HCPCS codes equals the single payment amount for the
original item. Contract suppliers must furnish the components of the
item and submit claims using the new HCPCS codes.
(b) If a single HCPCS code is divided into two or more separate
HCPCS codes, the single payment amount for each of the new separate
HCPCS codes is equal to the single payment amount applied to the single
HCPCS code. Contract suppliers must furnish the items and submit claims
using the new separate HCPCS codes.
(c) If the HCPCS codes for components of an item are merged into a
single HCPCS code for the item, the single payment amount for the new
HCPCS code is equal to the total of the separate single payment amounts
for the components. Contract suppliers must furnish the item and submit
claims using the new HCPCS code.
(d) If multiple HCPCS codes for similar items are merged into a
single HCPCS code, the items to which the new HCPCS codes apply may be
furnished by any supplier that has a valid Medicare billing number.
Payment for these items will be made in accordance with Subpart C or
Subpart D.
[72 FR 18085, Apr. 10, 2007]
Subpart G_Payment for Clinical Diagnostic Laboratory Tests
Source: 71 FR 69786, Dec. 1, 2006, unless otherwise noted.
Sec. 414.500 Basis and scope.
This subpart implements provisions of 1833(h)(8) of the Act and
1834A of the Act--procedures for determining the basis for, and amount
of, payment for a clinical diagnostic laboratory test (CDLT).
[81 FR 41098, June 23, 2016]
Sec. 414.502 Definitions.
For purposes of this subpart--
Actual list charge means the publicly available rate on the first
day the new advanced diagnostic laboratory test (ADLT) is obtainable by
a patient who is covered by private insurance, or marketed to the public
as a test a patient can receive, even if the test has not yet been
performed on that date.
Advanced diagnostic laboratory test (ADLT) means a clinical
diagnostic laboratory test (CDLT) covered under Medicare Part B that is
offered and furnished only by a single laboratory and not sold for use
by a laboratory other than the single laboratory that designed the test
or a successor owner of that laboratory, and meets one of the following
criteria:
(1) The test--
(i) Is an analysis of multiple biomarkers of deoxyribonucleic acid
(DNA), ribonucleic acid (RNA), or proteins;
(ii) When combined with an empirically derived algorithm, yields a
result that predicts the probability a specific individual patient will
develop a certain condition(s) or respond to a particular therapy(ies);
(iii) Provides new clinical diagnostic information that cannot be
obtained
[[Page 107]]
from any other test or combination of tests; and
(iv) May include other assays.
(2) The test is cleared or approved by the Food and Drug
Administration.
Applicable information, with respect to each CDLT for a data
collection period:
(1) Means--
(i) Each private payor rate for which final payment has been made
during the data collection period;
(ii) The associated volume of tests performed corresponding to each
private payor rate; and
(iii) The specific Healthcare Common Procedure Coding System (HCPCS)
code associated with the test.
(2) Does not include information about a test for which payment is
made on a capitated basis.
Applicable laboratory means an entity that:
(1) Is a laboratory, as defined in Sec. 493.2 of this chapter;
(2) Bills Medicare Part B under its own National Provider Identifier
(NPI);
(i) For hospital outreach laboratories--bills Medicare Part B on the
CMS 1450 under bill type 14x;
(ii) [Reserved]
(3) In a data collection period, receives more than 50 percent of
its Medicare revenues, which includes fee-for-service payments under
Medicare Parts A and B, prescription drug payments under Medicare Part
D, and any associated Medicare beneficiary deductible or coinsurance for
services furnished during the data collection period from one or a
combination of the following sources:
(i) This subpart G.
(ii) Subpart B of this part.
(4) Receives at least $12,500 of its Medicare revenues from this
subpart G. Except, for a single laboratory that offers and furnishes an
ADLT, this $12,500 threshold--
(i) Does not apply with respect to the ADLTs it offers and
furnishes; and
(ii) Applies with respect to all the other CDLTs it furnishes.
Data collection period is the 6 months from January 1 through June
30 during which applicable information is collected and that precedes
the data reporting period.
Data reporting period is the 3-month period, January 1 through March
31, during which a reporting entity reports applicable information to
CMS and that follows the preceding data collection period.
National Provider Identifier (NPI) means the standard unique health
identifier used by health care providers for billing payors, assigned by
the National Plan and Provider Enumeration System (NPPES) in 45 CFR part
162.
New advanced diagnostic laboratory test (ADLT) means an ADLT for
which payment has not been made under the clinical laboratory fee
schedule prior to January 1, 2018.
New ADLT initial period means a period of 3 calendar quarters that
begins on the first day of the first full calendar quarter following the
later of the date a Medicare Part B coverage determination is made or
ADLT status is granted by CMS.
New clinical diagnostic laboratory test (CDLT) means a CDLT that is
assigned a new or substantially revised Healthcare Common Procedure
Coding System (HCPCS) code, and that does not meet the definition of an
ADLT.
New test means any clinical diagnostic laboratory test for which a
new or substantially revised Healthcare Common Procedure Coding System
Code is assigned on or after January 1, 2005.
Private payor means:
(1) A health insurance issuer, as defined in section 2791(b)(2) of
the Public Health Service Act.
(2) A group health plan, as defined in section 2791(a)(1) of the
Public Health Service Act.
(3) A Medicare Advantage plan under Medicare Part C, as defined in
section 1859(b)(1) of the Act.
(4) A Medicaid managed care organization, as defined in section
1903(m)(1)(A) of the Act.
Private payor rate, with respect to applicable information:
(1) Is the final amount that is paid by a private payor for a CDLT
after all private payor price concessions are applied and does not
include price concessions applied by a laboratory.
(2) Includes any patient cost sharing amounts, if applicable.
(3) Does not include information about denied payments.
[[Page 108]]
Publicly available rate means the lowest amount charged for an ADLT
that is readily accessible in such forums as a company Web site, test
registry, or price listing, to anyone seeking to know how much a patient
who does not have the benefit of a negotiated rate would pay for the
test.
Reporting entity is the entity that reports tax-related information
to the Internal Revenue Service (IRS) using its Taxpayer Identification
Number (TIN) for its components that are applicable laboratories.
Single laboratory, for purposes of an ADLT, means:
(1) The laboratory, as defined in 42 CFR 493.2, which furnishes the
test, and that may also design, offer, or sell the test; and
(2) The following entities, which may design, offer, or sell the
test:
(i) The entity that owns the laboratory.
(ii) The entity that is owned by the laboratory.
Specific HCPCS code means a HCPCS code that does not include an
unlisted CPT code, as established by the American Medical Association,
or a Not Otherwise Classified (NOC) code, as established by the CMS
HCPCS Workgroup.
Substantially Revised Healthcare Common Procedure Coding System Code
means a code for which there has been a substantive change to the
definition of the test or procedure to which the code applies (such as a
new analyte or a new methodology for measuring an existing analyte
specific test).
Successor owner, for purposes of an ADLT, means a single laboratory,
that has assumed ownership of the single laboratory that designed the
test or of the single laboratory that is a successor owner to the single
laboratory that designed the test, through any of the following
circumstances:
(1) Partnership. The removal, addition, or substitution of a
partner, unless the partners expressly agree otherwise, as permitted by
applicable State law.
(2) Unincorporated sole proprietorship. Transfer of title and
property to another party.
(3) Corporation. The merger of the single laboratory corporation
into another corporation, or the consolidation of two or more
corporations, including the single laboratory, resulting in the creation
of a new corporation. Transfer of corporate stock or the merger of
another corporation into the single laboratory corporation does not
constitute change of ownership.
Taxpayer Identification Number (TIN) means a Federal taxpayer
identification number or employer identification number as defined by
the IRS in 26 CFR 301.6109-1.
[71 FR 69786, Dec. 1, 2006, as amended at 72 FR 66401, Nov. 27, 2007; 81
FR 41098, June 23, 2016; 83 FR 60074, Nov. 23, 2018]
Sec. 414.504 Data reporting requirements.
(a) In a data reporting period, a reporting entity must report
applicable information for each CDLT furnished by its component
applicable laboratories during the corresponding data collection period,
as follows--
(1) For CDLTs that are not ADLTs, every 3 years beginning January 1,
2017.
(2) For ADLTs that are not new ADLTs, every year beginning January
1, 2017.
(3) For new ADLTs--
(i) Initially, no later than the last day of the second quarter of
the new ADLT initial period; and
(ii) Thereafter, every year.
(b) Applicable information must be reported in the form and manner
specified by CMS.
(c) A laboratory seeking new ADLT status for its test must, in its
new ADLT application, attest to the actual list charge.
(d) To certify data integrity, the President, CEO, or CFO of a
reporting entity, or an individual who has been delegated authority to
sign for, and who reports directly to, such an officer, must sign the
certification statement and be responsible for assuring that the data
provided are accurate, complete, and truthful, and meets all the
reporting parameters described in this section.
(e) If the Secretary determines that a reporting entity has failed
to report applicable information for its applicable laboratories, or
made a misrepresentation or omission in reporting applicable information
for its applicable laboratories, the Secretary may apply a civil
monetary penalty to a reporting
[[Page 109]]
entity in an amount of up to $10,000 per day, as amended by the Federal
Civil Penalties Inflation Adjustment Act Improvements Act of 2015 (Sec.
701 of the Bipartisan Budget Act of 2015, Pub. L. 114-74, November 2,
2015), for each failure to report or each such misrepresentation or
omission. The provisions for civil monetary penalties that apply in
general to the Medicare program under 42 U.S.C. 1320a-7b apply in the
same manner to the laboratory data reporting process under this section.
(f) CMS or its contractors will not disclose applicable information
reported to CMS under this section in a manner that would identify a
specific payor or laboratory, or prices charged or payments made to a
laboratory, except to permit the Comptroller General, the Director of
the Congressional Budget Office, and the Medicare Payment Advisory
Commission, to review the information, or as CMS determines is necessary
to implement this subpart, such as disclosures to the HHS Office of
Inspector General or the Department of Justice for oversight and
enforcement activities.
(g) Applicable information may not be reported for an entity that
does not meet the definition of an applicable laboratory. For a single
laboratory that offers and furnishes an ADLT that is not an applicable
laboratory except with respect to its ADLTs, the applicable information
of its CDLTs that are not ADLTs may not be reported.
[81 FR 41099, June 23, 2016]
Sec. 414.506 Procedures for public consultation for payment
for a new clinical diagnostic laboratory test.
For a new CDLT, CMS determines the basis for and amount of payment
after performance of the following:
(a) CMS makes available to the public (through CMS's Internet Web
site) a list that includes codes for which establishment of a payment
amount is being considered for the next calendar year.
(b) CMS publishes a Federal Register notice of a meeting to receive
public comments and recommendations (and data on which recommendations
are based) on the appropriate basis, as specified in Sec. 414.508, for
establishing payment amounts for the list of codes made available to the
public.
(c) Not fewer than 30 days after publication of the notice in the
Federal Register, CMS convenes a meeting that includes representatives
of CMS officials involved in determining payment amounts, to receive
public comments and recommendations (and data on which the
recommendations are based).
(d) Considering the comments and recommendations (and accompanying
data) received at the public meeting, CMS develops and makes available
to the public (through an Internet Web site and other appropriate
mechanisms) a list of--
(1) Proposed determinations with respect to the appropriate basis
for establishing a payment amount for each code, with an explanation of
the reasons for each determination, the data on which the determinations
are based, including recommendations from the Advisory Panel on CDLTs
described in paragraph (e) of this section, and a request for written
public comments within a specified time period on the proposed
determination; and
(2) Final determinations of the payment amounts for tests, with the
rationale for each determination, the data on which the determinations
are based, and responses to comments and suggestions from the public.
(3) On or after January 1, 2018, in applying paragraphs (d)(1) and
(2) of this section, CMS will provide an explanation of how it took into
account the recommendations of the Advisory Panel on CDLTs described in
paragraph (e) of this section.
(4) On or after January 1, 2018, in applying paragraphs (d)(1) and
(2) of this section and Sec. 414.509(b)(2)(i) and (iii) when CMS uses
the gapfilling method described in Sec. 414.508(b)(2), CMS will make
available to the public an explanation of the payment rate for the test.
(e) CMS will consult with an expert outside advisory panel, called
the Advisory Panel on CDLTs, composed of an appropriate selection of
individuals with expertise, which may include molecular pathologists
researchers, and individuals with expertise in laboratory science or
health economics, in issues related to CDLTs. This advisory
[[Page 110]]
panel will provide input on the establishment of payment rates under
Sec. 414.508 and provide recommendations to CMS under this subpart.
[71 FR 69786, Dec. 1, 2006, as amended at 72 FR 66401, Nov. 27, 2007; 81
FR 41099, June 23, 2016]
Sec. 414.507 Payment for clinical diagnostic laboratory tests.
(a) General rule. Except as provided in paragraph (d) of this
section, and Sec. Sec. 414.508 and 414.522, the payment rate for a CDLT
furnished on or after January 1, 2018, is equal to the weighted median
for the test, as calculated under paragraph (b) of this section. Each
payment rate will be in effect for a period of one calendar year for
ADLTs and three calendar years for all other CDLTs, until the year
following the next data collection period.
(b) Methodology. For each test under paragraph (a) of this section
for which applicable information is reported, the weighted median is
calculated by arraying the distribution of all private payor rates,
weighted by the volume for each payor and each laboratory.
(c) The payment amounts established under this section are not
subject to any adjustment, such as geographic, budget neutrality, annual
update, or other adjustment.
(d) Phase-in of payment reductions. For years 2018 through 2023, the
payment rates established under this section for each CDLT that is not a
new ADLT or new CDLT, may not be reduced by more than the following
amounts for--
(1) 2018--10 percent of the national limitation amount for the test
in 2017.
(2) 2019--10 percent of the payment rate established in 2018.
(3) 2020--10 percent of the payment rate established in 2019.
(4) 2021--15 percent of the payment rate established in 2020.
(5) 2022--15 percent of the payment rate established in 2021.
(6) 2023--15 percent of the payment rate established in 2022.
(e) There is no administrative or judicial review under sections
1869 and 1878 of the Social Security Act, or otherwise, of the payment
rates established under this subpart.
(f) Effective April 1, 2014, the nominal fee that would otherwise
apply for a sample collected from an individual in a Skilled Nursing
Facility (SNF) or by a laboratory on behalf of a Home Health Agency
(HHA) is $5.
(g) For a CDLT for which CMS receives no applicable information,
payment is made based on the crosswalking or gapfilling methods
described in Sec. 414.508(b)(1) and (2).
(h) For ADLTs that are furnished between April 1, 2014 and December
31, 2017, payment is based on the crosswalking or gapfilling methods
described in Sec. 414.508(a).
[81 FR 41099, June 23, 2016]
Sec. 414.508 Payment for a new clinical diagnostic laboratory test.
(a) For a new CDLT that is assigned a new or substantially revised
code between January 1, 2005 and December 31, 2017, CMS determines the
payment amount based on either of the following:
(1) Crosswalking. Crosswalking is used if it is determined that a
new CDLT is comparable to an existing test, multiple existing test
codes, or a portion of an existing test code.
(i) CMS assigns to the new CDLT code, the local fee schedule amounts
and national limitation amount of the existing test.
(ii) Payment for the new CDLT code is made at the lesser of the
local fee schedule amount or the national limitation amount.
(2) Gapfilling. Gapfilling is used when no comparable existing CDLT
is available.
(i) In the first year, Medicare Administrative Contractor-specific
amounts are established for the new CDLT code using the following
sources of information to determine gapfill amounts, if available:
(A) Charges for the CDLT and routine discounts to charges;
(B) Resources required to perform the CDLT;
(C) Payment amounts determined by other payors; and
(D) Charges, payment amounts, and resources required for other tests
that may be comparable or otherwise relevant.
(ii) In the second year, the test code is paid at the national
limitation
[[Page 111]]
amount, which is the median of the contractor-specific amounts.
(iii) For a new CDLT for which a new or substantially revised HCPCS
code was assigned on or before December 31, 2007, after the first year
of gapfilling, CMS determines whether the contractor-specific amounts
will pay for the test appropriately. If CMS determines that the
contractor-specific amounts will not pay for the test appropriately, CMS
may crosswalk the test.
(b) For a new CDLT that is assigned a new or substantially revised
HCPCS code on or after January 1, 2018, CMS determines the payment
amount based on either of the following until applicable information is
available to establish a payment amount under the methodology described
in Sec. 414.507(b):
(1) Crosswalking. Crosswalking is used if it is determined that a
new CDLT is comparable to an existing test, multiple existing test
codes, or a portion of an existing test code.
(i) CMS assigns to the new CDLT code, the payment amount established
under Sec. 414.507 of the comparable existing CDLT.
(ii) Payment for the new CDLT code is made at the payment amount
established under Sec. 414.507.
(2) Gapfilling. Gapfilling is used when no comparable existing CDLT
is available.
(i) In the first year, Medicare Administrative Contractor-specific
amounts are established for the new CDLT code using the following
sources of information to determine gapfill amounts, if available:
(A) Charges for the test and routine discounts to charges;
(B) Resources required to perform the test;
(C) Payment amounts determined by other payors;
(D) Charges, payment amounts, and resources required for other tests
that may be comparable or otherwise relevant; and
(E) Other criteria CMS determines appropriate.
(ii) In the second year, the CDLT code is paid at the median of the
Medicare Administrative Contractor-specific amounts.
[81 FR 41100, June 23, 2016]
Sec. 414.509 Reconsideration of basis for and amount of payment
for a new clinical diagnostic laboratory test.
For a new CDLT, the following reconsideration procedures apply:
(a) Reconsideration of basis for payment. (1) CMS will receive
reconsideration requests in written format for 60 days after making a
determination of the basis for payment under Sec. 414.506(d)(2)
regarding whether CMS should reconsider the basis for payment and why a
different basis for payment would be more appropriate. If a requestor
recommends that the basis for payment should be changed from gapfilling
to crosswalking, the requestor may also recommend the code or codes to
which to crosswalk the new test.
(2)(i) A requestor that submitted a request under paragraph (a)(1)
of this section may also present its reconsideration request at the
public meeting convened under Sec. 414.506(c), provided that the
requestor requests an opportunity to present at the public meeting as
part of its written submission under paragraph (a)(1) of this section.
(ii) If the requestor presents its reconsideration request at the
public meeting convened under Sec. 414.506(c), members of the public
may comment on the reconsideration request verbally at the public
meeting and may submit written comments after the public meeting (within
the timeframe for public comments established by CMS).
(3) Considering reconsideration requests and other comments
received, CMS may reconsider its determination of the basis for payment.
As the result of such a reconsideration, CMS may change the basis for
payment from crosswalking to gapfilling or from gapfilling to
crosswalking.
(4) If the basis for payment is revised as the result of a
reconsideration, the new basis for payment is final and is not subject
to further reconsideration.
(b) Reconsideration of amount of payment--(1) Crosswalking. (i) For
60 days after making a determination under Sec. 414.506(d)(2) of the
code or codes to which a new test will be crosswalked, CMS receives
reconsideration requests in written format regarding whether CMS should
reconsider its determination and the recommended code or
[[Page 112]]
codes to which to crosswalk the new test.
(ii)(A) A requestor that submitted a request under paragraph
(b)(1)(i) of this section may also present its reconsideration request
at the public meeting convened under Sec. 414.506(c), provided that the
requestor requests an opportunity to present at the public meeting as
part of its written submission under paragraph (b)(1)(i) of this
section.
(B) If a requestor presents its reconsideration request at the
public meeting convened under Sec. 414.506(c), members of the public
may comment on the reconsideration request verbally at the public
meeting and may submit written comments after the public meeting (within
the timeframe for public comments established by CMS).
(iii) Considering comments received, CMS may reconsider its
determination of the amount of payment. As the result of such a
reconsideration, CMS may change the code or codes to which the new test
is crosswalked.
(iv) If CMS changes the basis for payment from gapfilling to
crosswalking as a result of a reconsideration, the crosswalked amount of
payment is not subject to reconsideration.
(2) Gapfilling. (i) By April 30 of the year after CMS makes a
determination under Sec. 414.506(d)(2) or paragraph (a)(3) of this
section that the basis for payment for a CDLT will be gapfilling, CMS
posts interim Medicare Administrative Contractor-specific amounts on the
CMS Web site.
(ii) For 60 days after CMS posts interim Medicare Administrative
Contractor-specific amounts on the CMS Web site, CMS will receive public
comments in written format regarding the interim Medicare Administrative
Contractor-specific amounts.
(iii) After considering the public comments, CMS will post final
Medicare Administrative Contractor-specific amounts on the CMS Web site.
(iv) For 30 days after CMS posts final Medicare Administrative
Contractor-specific payment amounts on the CMS Web site, CMS will
receive reconsideration requests in written format regarding whether CMS
should reconsider the final Medicare Administrative Contractor-specific
payment amount and median of the Medicare Administrative Contractor-
specific payment amount for the CDLT.
(v) Considering reconsideration requests received, CMS may
reconsider its determination of the amount of payment. As the result of
a reconsideration, CMS may revise the median of the Medicare
Administrative Contractor-specific payment amount for the CDLT.
(3) For both gapfilled and crosswalked new tests, if CMS revises the
amount of payment as the result of a reconsideration, the new amount of
payment is final and is not subject to further reconsideration.
(c) Effective date. If CMS changes a determination as the result of
a reconsideration, the new determination regarding the basis for or
amount of payment is effective January 1 of the year following
reconsideration. Claims for services with dates of service prior to the
effective date will not be reopened or otherwise reprocessed.
(d) Jurisdiction for reconsideration decisions. Jurisdiction for
reconsidering a determination rests exclusively with the Secretary. A
decision whether to reconsider a determination is committed to the
discretion of the Secretary. A decision not to reconsider an initial
determination is not subject to administrative or judicial review.
[72 FR 66401, Nov. 27, 2007, as amended at 73 FR 2432, Jan. 15, 2008; 81
FR 41100, June 23, 2016]
Sec. 414.510 Laboratory date of service for clinical laboratory
and pathology specimens.
The date of service for either a clinical laboratory test or the
technical component of physician pathology service is as follows:
(a) Except as provided under paragraph (b) of this section, the date
of service of the test must be the date the specimen was collected.
(b)(1) If a specimen was collected over a period that spans 2
calendar days, then the date of service must be the date the collection
ended.
(2) In the case of a test performed on a stored specimen, if a
specimen was stored for--
(i) Less than or equal to 30 calendar days from the date it was
collected, the
[[Page 113]]
date of service of the test must be the date the test was performed only
if--
(A) The test is ordered by the patient's physician at least 14 days
following the date of the patient's discharge from the hospital;
(B) The specimen was collected while the patient was undergoing a
hospital surgical procedure;
(C) It would be medically inappropriate to have collected the sample
other than during the hospital procedure for which the patient was
admitted;
(D) The results of the test do not guide treatment provided during
the hospital stay; and
(E) The test was reasonable and medically necessary for the
treatment of an illness.
(ii) More than 30 calendar days before testing, the specimen is
considered to have been archived and the date of service of the test
must be the date the specimen was obtained from storage.
(3) In the case of a chemotherapy sensitivity test performed on live
tissue, the date of service of the test must be the date the test was
performed only if--
(i) The decision regarding the specific chemotherapeutic agents to
test is made at least 14 days after discharge;
(ii) The specimen was collected while the patient was undergoing a
hospital surgical procedure;
(iii) It would be medically inappropriate to have collected the
sample other than during the hospital procedure for which the patient
was admitted;
(iv) The results of the test do not guide treatment provided during
the hospital stay; and,
(v) The test was reasonable and medically necessary for the
treatment of an illness.
(4) For purposes of this section, ``chemotherapy sensitivity test''
means a test identified by the Secretary as a test that requires a fresh
tissue sample to test the sensitivity of tumor cells to various
chemotherapeutic agents. The Secretary identifies such tests through
program instructions.
(5) In the case of a molecular pathology test or a test designated
by CMS as an ADLT under paragraph (1) of the definition of an advanced
diagnostic laboratory test in Sec. 414.502, the date of service of the
test must be the date the test was performed only if--
(i) The test was performed following a hospital outpatient's
discharge from the hospital outpatient department;
(ii) The specimen was collected from a hospital outpatient during an
encounter (as both are defined in Sec. 410.2 of this chapter);
(iii) It was medically appropriate to have collected the sample from
the hospital outpatient during the hospital outpatient encounter;
(iv) The results of the test do not guide treatment provided during
the hospital outpatient encounter; and
(v) The test was reasonable and medically necessary for the
treatment of an illness.
[71 FR 69786, Dec. 1, 2006, as amended at 72 FR 66402, Nov. 27, 2007; 82
FR 52636, Nov. 13, 2017; 82 FR 59496, Dec. 14, 2017]
Sec. 414.522 Payment for new advanced diagnostic laboratory tests.
(a) The payment rate for a new ADLT--
(1) During the new ADLT initial period, is equal to its actual list
charge.
(2) Prior to the new ADLT initial period, is determined by the
Medicare Administrative Contractor based on information provided by the
laboratory seeking new ADLT status for its laboratory test.
(b) After the new ADLT initial period, the payment rate for a new
ADLT is equal to the weighted median established under the payment
methodology described in Sec. 414.507(b).
(c) If, after the new ADLT initial period, the actual list charge of
a new ADLT is greater than 130 percent of the weighted median
established under the payment methodology described in Sec. 414.507,
CMS will recoup the difference between the ADLT actual list charge and
130 percent of the weighted median.
(d) If CMS does not receive any applicable information for a new
ADLT by the last day of the second quarter of the new ADLT initial
period, the payment rate for the test is determined either by the
gapfilling or crosswalking method as described in Sec. 414.508(b)(1)
and (2).
[81 FR 41100, June 23, 2016]
[[Page 114]]
Subpart H_Fee Schedule for Ambulance Services
Source: 67 FR 9132, Feb. 27, 2002, unless otherwise noted.
Sec. 414.601 Purpose.
This subpart implements section 1834(l) of the Act by establishing a
fee schedule for the payment of ambulance services. Section 1834(l) of
the Act requires that, except for services furnished by certain critical
access hospitals (see Sec. 413.70(b)(5) of this chapter), payment for
all ambulance services, otherwise previously payable on a reasonable
charge basis or retrospective reasonable cost basis, be made under a fee
schedule.
Sec. 414.605 Definitions.
As used in this subpart, the following definitions apply to both
land and water (hereafter collectively referred to as ``ground'')
ambulance services and to air ambulance services unless otherwise
specified:
Advanced life support (ALS) assessment is an assessment performed by
an ALS crew as part of an emergency response that was necessary because
the patient's reported condition at the time of dispatch was such that
only an ALS crew was qualified to perform the assessment. An ALS
assessment does not necessarily result in a determination that the
patient requires an ALS level of service.
Advanced life support (ALS) intervention means a procedure that is,
in accordance with State and local laws, required to be furnished by ALS
personnel.
Advanced life support, level 1 (ALS1) means transportation by ground
ambulance vehicle, medically necessary supplies and services and either
an ALS assessment by ALS personnel or the provision of at least one ALS
intervention.
Advanced life support, level 2 (ALS2) means either transportation by
ground ambulance vehicle, medically necessary supplies and services, and
the administration of at least three medications by intravenous push/
bolus or by continuous infusion, excluding crystalloid, hypotonic,
isotonic, and hypertonic solutions (Dextrose, Normal Saline, Ringer's
Lactate); or transportation, medically necessary supplies and services,
and the provision of at least one of the following ALS procedures:
(1) Manual defibrillation/cardioversion.
(2) Endotracheal intubation.
(3) Central venous line.
(4) Cardiac pacing.
(5) Chest decompression.
(6) Surgical airway.
(7) Intraosseous line.
Advanced life support (ALS) personnel means an individual trained to
the level of the emergency medical technician-intermediate (EMT-
Intermediate) or paramedic. The EMT-Intermediate is defined as an
individual who is qualified, in accordance with State and local laws, as
an EMT-Basic and who is also qualified in accordance with State and
local laws to perform essential advanced techniques and to administer a
limited number of medications. The EMT-Paramedic is defined as
possessing the qualifications of the EMT-Intermediate and also, in
accordance with State and local laws, as having enhanced skills that
include being able to administer additional interventions and
medications.
Basic life support (BLS) means transportation by ground ambulance
vehicle and medically necessary supplies and services, plus the
provision of BLS ambulance services. The ambulance must be staffed by at
least two people who meet the requirements of state and local laws where
the services are being furnished. Also, at least one of the staff
members must be certified, at a minimum, as an emergency medical
technician-basic (EMT-Basic) by the State or local authority where the
services are furnished and be legally authorized to operate all
lifesaving and life-sustaining equipment on board the vehicle. These
laws may vary from State to State.
Conversion factor (CF) is the dollar amount established by CMS that
is multiplied by relative value units to produce ground ambulance
service base rates.
Emergency response means responding immediately at the BLS or ALS1
level of service to a 911 call or the equivalent in areas without a 911
call system. An
[[Page 115]]
immediate response is one in which the ambulance entity begins as
quickly as possible to take the steps necessary to respond to the call.
Fixed wing air ambulance (FW) means transportation by a fixed wing
aircraft that is certified as a fixed wing air ambulance and such
services and supplies as may be medically necessary.
Geographic adjustment factor (GAF) means the practice expense (PE)
portion of the geographic practice cost index (GPCI) from the physician
fee schedule as applied to a percentage of the base rate. For ground
ambulance services, the PE portion of the GPCI is applied to 70 percent
of the base rate for each level of service. For air ambulance services,
the PE portion of the GPCI is applied to 50 percent of the applicable
base rate.
Loaded mileage means the number of miles the Medicare beneficiary is
transported in the ambulance vehicle.
Paramedic ALS intercept (PI) means EMT-Paramedic services furnished
by an entity that does not furnish the ground ambulance transport,
provided the services meet the requirements specified in Sec. 410.40(c)
of this chapter.
Point of pick-up means the location of the beneficiary at the time
he or she is placed on board the ambulance.
Relative value units (RVUs) means a value assigned to a ground
ambulance service.
Rotary wing air ambulance (RW) means transportation by a helicopter
that is certified as an ambulance and such services and supplies as may
be medically necessary.
Rural adjustment factor (RAF) means an adjustment applied to the
base payment rate when the point of pick-up is located in a rural area.
Rural area means an area located outside an urban area, or a rural
census tract within a Metropolitan Statistical Area as determined under
the most recent version of the Goldsmith modification as determined by
the Office of Rural Health Policy of the Health Resources and Services
Administration.
Specialty care transport (SCT) means interfacility transportation of
a critically injured or ill beneficiary by a ground ambulance vehicle,
including medically necessary supplies and services, at a level of
service beyond the scope of the EMT-Paramedic. SCT is necessary when a
beneficiary's condition requires ongoing care that must be furnished by
one or more health professionals in an appropriate specialty area, for
example, nursing, emergency medicine, respiratory care, cardiovascular
care, or a paramedic with additional training.
Urban area means a Metropolitan Statistical Area, as defined by the
Executive Office of Management and Budget.
[67 FR 9132, Feb. 27, 2002, as amended at 68 FR 67693, Dec. 5, 2003; 71
FR 69787, Dec. 1, 2006; 80 FR 71382, Nov. 16, 2015]
Sec. 414.610 Basis of payment.
(a) Method of payment. Medicare payment for ambulance services is
based on the lesser of the actual charge or the applicable fee schedule
amount. The fee schedule payment for ambulance services equals a base
rate for the level of service plus payment for mileage and applicable
adjustment factors. Except for services furnished by certain critical
access hospitals or entities owned and operated by them, as described in
Sec. 413.70(b) of this chapter, all ambulance services are paid under
the fee schedule specified in this subpart (regardless of the vehicle
furnishing the service).
(b) Mandatory assignment. Effective with implementation of the
ambulance fee schedule described in Sec. 414.601 (that is, for services
furnished on or after April 1, 2002), all payments made for ambulance
services are made only on an assignment-related basis. Ambulance
suppliers must accept the Medicare allowed charge as payment in full and
may not bill or collect from the beneficiary any amount other than the
unmet Part B deductible and Part B coinsurance amounts. Violations of
this requirement may subject the provider or supplier to sanctions, as
provided by law (part 402 of this chapter).
(c) Formula for computation of payment amounts. The fee schedule
payment amount for ambulance services is computed according to the
following provisions:
(1) Ground ambulance service levels. The CF is multiplied by the
applicable RVUs for each level of service to produce a service-level
base rate.
[[Page 116]]
(i) For services furnished during the period July 1, 2004 through
December 31, 2006, ambulance services originating in--
(A) Urban areas (both base rate and mileage) are paid based on a
rate that is 1 percent higher than otherwise is applicable under this
section; and
(B) Rural areas (both base rate and mileage) are paid based on a
rate that is 2 percent higher than otherwise is applicable under this
section.
(ii) For services furnished during the period July 1, 2008 through
December 31, 2022, ambulance services originating in:
(A) Urban areas (both base rate and mileage) are paid based on a
rate that is 2 percent higher than otherwise is applicable under this
section.
(B) Rural areas (both base rate and mileage) are paid based on a
rate that is 3 percent higher than otherwise is applicable under this
section.
(iii) The service-level base rate is then adjusted by the GAF.
Compare this amount to the actual charge. The lesser of the actual
charge or the GAF adjusted base rate amount is added to the lesser of
the actual mileage charges or the payment rate per mile, multiplied by
the number of miles that the beneficiary was transported. When
applicable, the appropriate RAF is applied to the ground mileage rate to
determine the appropriate payment rates. The RVU scale for the ambulance
fee schedule is as follows:
------------------------------------------------------------------------
Relative
value
Service level units
(RVUs)
------------------------------------------------------------------------
BLS......................................................... 1.00
BLS-Emergency............................................... 1.60
ALS1........................................................ 1.20
ALS1-Emergency.............................................. 1.90
ALS2........................................................ 2.75
SCT......................................................... 3.25
PI.......................................................... 1.75
------------------------------------------------------------------------
(2) Air ambulance service levels. The base payment rate for the
applicable type of air ambulance service is adjusted by the GAF and,
when applicable, by the appropriate RAF to determine the amount of
payment. Air ambulance services have no CF or RVUs. This amount is
compared to the actual charge. The lesser of the charge or the adjusted
GAF rate amount is added to the payment rate per mile, multiplied by the
number of miles that the beneficiary was transported. When applicable,
the appropriate RAF is also applied to the air mileage rate.
(3) Loaded mileage. Payment is based on loaded miles. Payment for
air mileage is based on loaded miles flown as expressed in statute
miles. There are three mileage payment rates: a rate for FW services, a
rate for RW services, and a rate for all levels of ground
transportation.
(4) Geographic adjustment factor (GAF). For ground ambulance
services, the PE portion of the GPCI from the physician fee schedule is
applied to 70 percent of the base rate for ground ambulance services.
For air ambulance services, the PE portion of the physician fee schedule
GPCI is applied to 50 percent of the base rate for air ambulance
services.
(5) Rural adjustment factor (RAF). (i) For ground ambulance services
where the point of pickup is in a rural area, the mileage rate is
increased by 50 percent for each of the first 17 miles and, for services
furnished before January 1, 2004, by 25 percent for miles 18 through 50.
The standard mileage rate applies to every mile over 50 miles and, for
services furnished after December 31, 2003, to every mile over 17 miles.
For air ambulance services where the point of pickup is in a rural area,
the total payment is increased by 50 percent; that is, the rural
adjustment factor applies to the sum of the base rate and the mileage
rate.
(ii) For services furnished during the period July 1, 2004 through
December 31, 2022, the payment amount for the ground ambulance base rate
is increased by 22.6 percent where the point of pickup is in a rural
area determined to be in the lowest 25 percent of rural population
arrayed by population density. The amount of this increase is based on
CMS's estimate of the ratio of the average cost per trip for the rural
areas in the lowest quartile of population compared to the average cost
per trip for the rural areas in the highest quartile of population. In
making this estimate, CMS may use data provided by the GAO.
(6) Multiple patients. The allowable amount per beneficiary for a
single ambulance transport when more than one
[[Page 117]]
patient is transported simultaneously is based on the total number of
patients (both Medicare and non-Medicare) on board. If two patients are
transported simultaneously, then the payment allowance for the
beneficiary (or for each of them if both patients are beneficiaries) is
equal to 75 percent of the service payment allowance applicable for the
level of care furnished to the beneficiary, plus 50 percent of the
applicable mileage payment allowance. If three or more patients are
transported simultaneously, the payment allowance for the beneficiary
(or each of them) is equal to 60 percent of the service payment
allowance applicable for the level of care furnished to the beneficiary,
plus the applicable mileage payment allowance divided by the number of
patients on board.
(7) Payment rate for mileage greater than 50 miles. For services
furnished during the period July 1, 2004 through December 31, 2008, each
loaded ambulance mile greater than 50 (that is, miles 51 and greater)
for ambulance transports originating in either urban areas or in rural
areas are paid based on a rate that is 25 percent higher than otherwise
is applicable under this section.
(8) Transport of an individual with end-stage renal disease for
renal dialysis services. For ambulance services furnished during the
period October 1, 2013 through September 30, 2018, consisting of non-
emergency basic life support (BLS) services involving transport of an
individual with end-stage renal disease for renal dialysis services (as
described in section 1881(b)(14)(B) of the Act) furnished other than on
an emergency basis by a provider of services or a renal dialysis
facility, the fee schedule amount otherwise applicable (both base rate
and mileage) is reduced by 10 percent. For such services furnished on or
after October 1, 2018, the fee schedule amount otherwise applicable
(both base rate and mileage) is reduced by 23 percent.
(d) Payment. Payment, in accordance with this subpart, represents
payment in full (subject to applicable Medicare Part B deductible and
coinsurance requirements as described in subpart G of part 409 of this
chapter or in subpart I of part 410 of this chapter) for all services,
supplies, and other costs for an ambulance service furnished to a
Medicare beneficiary. No direct payment will be made under this subpart
if billing for the ambulance service is required to be consolidated with
billing for another benefit for which payment may be made under this
chapter.
(e) Point of pick-up. The zip code of the point of pick-up must be
reported on each claim for ambulance services so that the correct GAF
and RAF may be applied, as appropriate.
(f) Updates. The CF, the air ambulance base rates, and the mileage
rates are updated annually by an inflation factor established by law.
The inflation factor is based on the consumer price index for all urban
consumers (CPI-U) (U.S. city average) for the 12-month period ending
with June of the previous year and, for 2011 and each subsequent year,
is reduced by the productivity adjustment described in section
1886(b)(3)(B)(xi)(II) of the Act.
(g) Adjustments. The Secretary monitors payment and billing data on
an ongoing basis and adjusts the CF and air ambulance rates as
appropriate to reflect actual practices under the fee schedule. These
rates are not adjusted solely because of changes in the total number of
ambulance transports.
(h) Treatment of certain areas for payment for air ambulance
services. Any area that was designated as a rural area for purposes of
making payments under the ambulance fee schedule for air ambulance
services furnished on December 31, 2006, must be treated as a rural area
for purposes of making payments under the ambulance fee schedule for air
ambulance services furnished during the period July 1, 2008 through June
30, 2013.
[67 FR 9132, Feb. 27, 2002, as amended at 68 FR 67693, Dec. 5, 2003; 69
FR 40292, July 1, 2004; 71 FR 69787, Dec. 1, 2006; 73 FR 69937, Nov. 19,
2008; 74 FR 62012, Nov. 25, 2009; 75 FR 73625, Nov. 29, 2010; 76 FR
70315, Nov. 10, 2011; 77 FR 69368, Nov. 16, 2012; 78 FR 74820, Dec. 10,
2013; 79 FR 68005, Nov. 13, 2014; 80 FR 71382, Nov. 16, 2015; 83 FR
60074, Nov. 23, 2018]
Sec. 414.615 Transition to the ambulance fee schedule.
The fee schedule for ambulance services will be phased in over 5
years beginning April 1, 2002. Subject to the first sentence in Sec.
414.610(a), payment
[[Page 118]]
for services furnished during the transition period is made based on a
combination of the fee schedule payment for ambulance services and the
amount the program would have paid absent the fee schedule for ambulance
services, as follows:
(a) 2002 Payment. For services furnished in 2002, the payment for
the service component, the mileage component and, if applicable, the
supply component is based on 80 percent of the reasonable charge for
independent suppliers or on 80 percent of reasonable cost for providers,
plus 20 percent of the ambulance fee schedule amount for the service and
mileage components. The reasonable charge or reasonable cost portion of
payment in CY 2002 is equal to the supplier's reasonable charge
allowance or provider's reasonable cost allowance for CY 2001,
multiplied by the statutory inflation factor for ambulance services.
(b) 2003 Payment. For services furnished in CY 2003, payment is
based on 60 percent of the reasonable charge or reasonable cost, as
applicable, plus 40 percent of the ambulance fee schedule amount. The
reasonable charge and reasonable cost portion in CY 2003 is equal to the
supplier's reasonable charge or provider's reasonable cost for CY 2002,
multiplied by the statutory inflation factor for ambulance services.
(c) 2004 Payment. For services furnished in CY 2004, payment is
based on 40 percent of the reasonable charge or reasonable cost, as
applicable, plus 60 percent of the ambulance fee schedule amount. The
reasonable charge and reasonable cost portion in CY 2004 is equal to the
supplier's reasonable charge or provider's reasonable cost for CY 2003,
multiplied by the statutory inflation factor for ambulance services.
(d) 2005 Payment. For services furnished in CY 2005, payment is
based on 20 percent of the reasonable charge or reasonable cost, as
applicable, plus 80 percent of the ambulance fee schedule amount. The
reasonable charge and reasonable cost portion in CY 2005 is equal to the
supplier's reasonable charge or provider's reasonable cost for CY 2004,
multiplied by the statutory inflation factor for ambulance services.
(e) 2006 and Beyond Payment. For services furnished in CY 2006 and
thereafter, the payment is based solely on the ambulance fee schedule
amount.
(f) Updates. The portion of the transition payment that is based on
the existing payment methodology (that is, the non-fee-schedule portion)
is updated annually for inflation by a factor equal to the percentage
increase in the CPI-U (U.S. city average) for the 12-month period ending
with June of the previous year. The CY 2002 inflation update factor used
to update the 2001 payment amounts is applied to the annualized
(average) payment amounts for CY 2001. For the period January 1, 2001
through June 30, 2001, the inflation update factor is 2.7 percent. For
the period July 1, 2001 through December 31, 2001, the inflation update
factor is 4.7 percent. The average for the year is 3.7 percent. Thus,
the annualized (average) CY 2001 payment amounts used to derive the CY
2002 payment amounts are equivalent to the CY 2001 payment amounts that
would have been determined had the inflation update factor for the
entire CY 2001 been 3.7 percent. Both portions of the transition payment
(that is, the portion that is based on reasonable charge or reasonable
cost and the portion that is based on the ambulance fee schedule) are
updated annually for inflation by the inflation factor described in
Sec. 414.610(f).
(g) Exception. There will be no blended payment allowance as
described in paragraphs (a), (b), (c), and (d) of this section for
ground mileage in those States where the Medicare carrier paid
separately for all out-of-county ground ambulance mileage, but did not,
before the implementation of the Medicare ambulance fee schedule, make a
separate payment for any ground ambulance mileage within the county in
which the beneficiary was transported. Payment for ground ambulance
mileage in that State will be made based on the full ambulance fee
schedule amount for ground mileage. This exception applies only to
carrier-processed claims and only in those States in which the carrier
paid separately for out-of-county ambulance mileage, but did not make
separate payment for any in-county mileage throughout the entire State.
[[Page 119]]
Sec. 414.617 Transition from regional to national ambulance fee schedule.
For services furnished during the period July 1, 2004 through
December 31, 2009, the amount for the ground ambulance base rate is
subject to a floor amount determined by establishing nine fee schedules
based on each of the nine census divisions using the same methodology as
used to establish the national fee schedule. If the regional fee
schedule methodology for a given census division results in an amount
that is less than or equal to the national ground base rate, then it is
not used, and the national FS amount applies. If the regional fee
schedule methodology for a given census division results in an amount
that is greater than the national ground base rate, then the FS portion
of the base rate for that census division is equal to a blend of the
national rate and the regional rate in accordance with the following
schedule:
------------------------------------------------------------------------
Regional National
Time period percent percent
------------------------------------------------------------------------
7/1/04-12/31/04................................... 80 20
CY 2005........................................... 60 40
CY 2006........................................... 40 60
CY 2007-CY 2009................................... 20 80
CY 2010 and thereafter............................ 0 100
------------------------------------------------------------------------
[69 FR 40292, July 1, 2004]
Sec. 414.620 Publication of the ambulance fee schedule.
(a) Changes in payment rates resulting from incorporation of the
annual inflation factor and the productivity adjustment as described in
Sec. 414.610(f) will be announced by CMS by instruction and on the CMS
Web site.
(b) CMS will follow applicable rulemaking procedures in publishing
revisions to the fee schedule for ambulance services that result from
any factors other than those described in Sec. 414.610(f).
[75 FR 73626, Nov. 29, 2010]
Sec. 414.625 Limitation on review.
There will be no administrative or judicial review under section
1869 of the Act or otherwise of the amounts established under the fee
schedule for ambulance services, including the following:
(a) Establishing mechanisms to control increases in expenditures for
ambulance services.
(b) Establishing definitions for ambulance services that link
payments to the type of services provided.
(c) Considering appropriate regional and operational differences.
(d) Considering adjustments to payment rates to account for
inflation and other relevant factors.
(e) Phasing in the application of the payment rates under the fee
schedule in an efficient and fair manner.
Subpart I_Payment for Drugs and Biologicals
Source: 69 FR 1116, Jan. 7, 2004, unless otherwise noted.
Sec. 414.701 Purpose.
This subpart implements section 1842(o) of the Social Security Act
by specifying the methodology for determining the payment allowance
limit for drugs and biologicals covered under Part B of Title XVIII of
the Act (hereafter in this subpart referred to as the ``program'') that
are not paid on a cost or prospective payment system basis. Examples of
drugs that are subject to the rules contained in this subpart are: drugs
furnished incident to a physician's service; durable medical equipment
(DME) drugs; separately billable drugs at independent dialysis
facilities not under the ESRD composite rate; statutorily covered drugs,
for example, influenza, pneumococcal and hepatitis vaccines, antigens,
hemophilia blood clotting factor, immunosuppressive drugs and certain
oral anti-cancer drugs.
Sec. 414.704 Definitions.
As used in this subpart, the following definition applies. Drug
refers to both drugs and biologicals.
Sec. 414.707 Basis of payment.
(a) Method of payment. (1) Payment for a drug in calendar year 2004
is based on the lesser of--
(i) The actual charge on the claim for program benefits; or
(ii) 85 percent of the average wholesale price determined as of
April 1,
[[Page 120]]
2003, subject to the exceptions as specified in paragraphs (a)(2)
through (a)(8) of this section.
(2) The payment limits for the following drugs are calculated using
95 percent of the average wholesale price:
(i) Blood clotting factors.
(ii) A drug or biological furnished during 2004 that was not
available for Medicare payment as of April 1, 2003.
(iii) Pneumococcal and influenza vaccines as well as hepatitis B
vaccine that is furnished to individuals at high or intermediate risk of
contracting hepatitis B (as determined by the Secretary).
(iv) A drug or biological furnished during 2004 in connection with
the furnishing of renal dialysis services if separately billed by renal
dialysis facilities.
(3) The payment limits for infusion drugs furnished through a
covered item of durable medical equipment are calculated using 95
percent of the average wholesale price in effect on October 1, 2003.
(4) The payments limits for drugs contained in the following table
are calculated based on the percentages of the average wholesale price
determined as of April 1, 2003 that are specified in the table.
------------------------------------------------------------------------
Percentage
used to
calculate
Drug 2004
payment
limit
------------------------------------------------------------------------
EPOETIN ALFA............................................... 87
LEUPROLIDE ACETATE......................................... 81
GOSERELIN ACETATE.......................................... 80
RITUXIMAB.................................................. 81
PACLITAXEL................................................. 81
DOCETAXEL.................................................. 80
CARBOPLATIN................................................ 81
IRINOTECAN................................................. 80
GEMCITABINE HCL............................................ 80
PAMIDRONATE DISODIUM....................................... 85
DOLASETRON MESYLATE........................................ 80
FILGRASTIM................................................. 81
HYLAN G-F 20............................................... 82
MYCOPHENOLATE MOFETIL...................................... 86
GRANISETRON HCL............................................ 80
ONDANSETRON................................................ 87
VINORELBINE TARTATE........................................ 81
SARGRAMOSTIM............................................... 80
TOPOTECAN.................................................. 84
IPRATROPIUM BROMIDE........................................ 80
ALBUTEROL SULFATE.......................................... 80
IMMUNE GLOBULIN............................................ 80
LEUCOVORIN CALCIUM......................................... 80
DOXORUBICIN HCL............................................ 80
DEXAMETHOSONE SODIUM PHOSPHATE............................. 86
HEPARIN SODIUM LOCK-FLUSH.................................. 80
CROMOLYN SODIUM............................................ 80
ACETYLCYSTEINE............................................. 80
------------------------------------------------------------------------
(5) The payment limits for imiglucerase and alglucerase are
calculated using 94 percent of the average wholesale price determined as
of April 1, 2003.
(6) Exception. The payment limit for a drug otherwise subject to
paragraph (a)(1)(ii) or paragraph (a)(4) of this section may be
calculated using the percentage of the average wholesale price as the
Secretary deems appropriate based on data and information submitted by
the drug manufacturer.
(i) The manufacturer must submit data after October 15, 2003 and
before January 1, 2004.
(ii) The percentage only applies for drugs furnished on or after
April 1, 2004.
(7) In the case of blood and blood products (other than blood
clotting factors), the payment limits shall be determined in the same
manner as such payment limit was determined on October 1, 2003.
(b) Mandatory assignment. Effective with services furnished on or
after February 1, 2001, payment for any drug covered under Part B of
Medicare may be made on an assignment-related basis only. All billers
must accept the program allowed charge as payment in full and may not
bill nor collect from the beneficiary any amount other than the unmet
Part B deductible and Part B coinsurance amounts, if applicable.
Violations of this requirement may subject the supplier to sanctions, as
provided by the statute (See Sec. 402 of this chapter).
(c) Mandatory reporting of anemia quality indicators. The following
provisions are effective January 1, 2008:
(1) Each request for payment for anti-anemia drugs furnished to
treat anemia resulting from the treatment of cancer must report the
beneficiary's most recent hemoglobin or hematocrit level;
(2) Each request for payment for use of erythropoiesis stimulating
agents
[[Page 121]]
must report the beneficiary's most recent hemoglobin or hematocrit
level.
[69 FR 1116, Jan. 7, 2004, as amended at 72 FR 66402, Nov. 27, 2007]
Subpart J_Submission of Manufacturer's Average Sales Price Data
Source: 69 FR 17938, Apr. 6, 2004, unless otherwise noted.
Sec. 414.800 Purpose.
This subpart implements section 1847A of the Act by specifying the
requirements for submission of a manufacturer's average sales price data
for certain drugs and biologicals covered under Part B of Title XVIII of
the Act that are paid under sections 1842(o)(1)(D), 1847A, and
1881(b)(13)(A)(ii) of the Act.
Sec. 414.802 Definitions.
As used in this subpart, unless the context indicates otherwise--
Bona fide service fees means fees paid by a manufacturer to an
entity, that represent fair market value for a bona fide, itemized
service actually performed on behalf of the manufacturer that the
manufacturer would otherwise perform (or contract for) in the absence of
the service arrangement, and that are not passed on in whole or in part
to a client or customer of an entity, whether or not the entity takes
title to the drug.
Drug means both drugs and biologicals.
Manufacturer means any entity that is engaged in the following (This
term does not include a wholesale distributor of drugs or a retail
pharmacy licensed under State law):
(1) Production, preparation, propagation, compounding, conversion or
processing of prescription drug products, either directly or indirectly
by extraction from substances of natural origin, or independently by
means of chemical synthesis, or by a combination of extraction and
chemical synthesis.
(2) The packaging, repackaging, labeling, relabeling, or
distribution of prescription drug products.
Unit means the product represented by the 11-digit National Drug
Code, unless otherwise specified by CMS to account for situations where
labeling indicates that the amount of drug product represented by a
National Drug Code varies. The method of counting units excludes units
of CAP drugs (as defined in Sec. 414.902 of this part) sold to an
approved CAP vendor (as defined in Sec. 414.902 of this part) for use
under the CAP (as defined in Sec. 414.902 of this part).
[69 FR 17938, Apr. 6, 2004, as amended at 71 FR 48143, Aug. 18, 2006; 71
FR 69787, Dec. 1, 2006; 74 FR 62012, Nov. 25, 2009; 76 FR 73473, Nov.
28, 2011]
Sec. 414.804 Basis of payment.
(a) Calculation of manufacturer's average sales price. (1) The
manufacturer's average sales price for a quarter for a drug represented
by a particular 11-digit National Drug Code must be calculated as the
manufacturer's sales to all purchasers in the United States for that
particular 11-digit National Drug Code (after excluding sales as
specified in paragraph (a)(4) of this section and then deducting price
concessions as specified in paragraphs (a)(2) and (a)(3) of this
section) divided by the total number of units sold by the manufacturer
in that quarter (after excluding units associated with sales as
specified in paragraph (a)(4) of this section).
(2) Price concessions. (i) In calculating the manufacturer's average
sales price, a manufacturer must deduct price concessions. Price
concessions include the following types of transactions and items:
(A) Volume discounts.
(B) Prompt pay discounts.
(C) Cash discounts.
(D) Free goods that are contingent on any purchase requirement.
(E) Chargebacks and rebates (other than rebates under the Medicaid
program).
(ii) For the purposes of paragraph (a)(2)(i), bona fide services
fees are not considered price concessions.
(3) To the extent that data on price concessions, as described in
paragraph (a)(2) of this section, are available on a lagged basis, the
manufacturer must estimate this amount in accordance with the
methodology described in this paragraph.
[[Page 122]]
(i)(A) For each National Drug Code with at least 12 months of sales
(including products for which the manufacturer has redesignated the
National Drug Code for the specific product and package size and has 12
months of sales across the prior and current National Drug Codes), after
adjusting for exempted sales, the manufacturer calculates a percentage
equal to the sum of the price concessions for the most recent 12-month
period available associated with sales subject to the average sales
price reporting requirement divided by the total in dollars for the
sales subject to the average sales price reporting requirement for the
same 12-month period.
(B) For each National Drug Code with less than 12 months of sales,
the calculation described in paragraph (i)(A) of this section is
performed for the time period equaling the total number of months of
sales.
(ii) The manufacturer multiplies the applicable percentage described
in paragraph (a)(3)(i)(A) or (a)(3)(i)(B) of this section by the total
in dollars for the sales subject to the average sales price reporting
requirement (after adjusting for exempted sales) for the quarter being
submitted. (The manufacturer must carry a sufficient number of decimal
places in the calculation of the price concessions percentage in order
to round accurately the net total sales amount for the quarter to the
nearest whole dollar.) The result of this multiplication is then
subtracted from the total in dollars for the sales subject to the
average sales price reporting requirement (after adjusting for exempted
sales) for the quarter being submitted.
(iii) The manufacturer uses the result of the calculation described
in paragraph (a)(3)(ii) of this section as the numerator and the number
of units sold in the quarter (after adjusting for exempted sales) as the
denominator to calculate the manufacturer's average sales price for the
National Drug Code for the quarter being submitted.
(iv) Example. After adjusting for exempted sales, the total lagged
price concessions (discounts, rebates, etc.) over the most recent 12-
month period available associated with sales for National Drug Code
12345-6789-01 subject to the ASP reporting requirement equal $200,000,
and the total in dollars for the sales subject to the average sales
price reporting requirement for the same period equals $600,000. The
lagged price concessions percentage for this period equals 200,000/
600,000 = 0.33333. The total in dollars for the sales subject to the
average sales price reporting requirement for the quarter being
reported, equals $50,000 for 10,000 units sold. The manufacturer's
average sales price calculation for this National Drug Code for this
quarter is: $50,000-(0.33333 x $50,000) = $33,334 (net total sales
amount); $33,334/10,000 = $3.33 (average sales price).
(4) Exempted sales. (i) In calculating the manufacturer's average
sales price, a manufacturer must exclude sales that are exempt from
inclusion in the determination of the best price under section
1927(c)(1)(C)(i) of the Act and sales that are merely nominal in amount
as applied for purposes of section 1927(c)(1)(C)(ii)(III) of the Act, as
limited by section 1927(c)(1)(D) of the Act.
(ii) In determining nominal sales exempted under section
1927(c)(1)(C)(ii)(III) of the Act, the manufacturer calculates the
average manufacturer price as defined in section 1927(k) of the Act and
then identifies sales that are eligible to be considered a nominal sale
under section 1927(c)(1)(D) of the Act and are at less than 10 percent
of the average manufacturer price. To identify nominal sales, the
manufacturer must use the average manufacturer price for the calendar
quarter that is the same calendar quarter as the average sales price
reporting period.
(5) The manufacturer's average sales price must be calculated by the
manufacturer every calendar quarter and submitted to CMS within 30 days
of the close of the quarter. The first quarter submission must be
submitted by April 30, 2004. Subsequent reports are due not later than
30 days after the last day of each calendar quarter.
(6) The manufacturer's average sales price must be calculated based
on the amount of product in a vial or other container as conspicuously
reflected on the FDA approved label as defined by
[[Page 123]]
section 201(k) of the Food, Drug, and Cosmetic Act.
(7) Each report must be certified by one of the following:
(i) The manufacturer's Chief Executive Officer (CEO).
(ii) The manufacturer's Chief Financial Officer (CFO).
(iii) An individual who has delegated authority to sign for, and who
reports directly to, the manufacturer's CEO or CFO.
(b) [Reserved]
[69 FR 17938, Apr. 6, 2004, as amended at 69 FR 55764, Sept. 16, 2004;
70 FR 70332, Nov. 21, 2005; 71 FR 69787, Dec. 1, 2006; 72 FR 18914, Apr.
16, 2007; 75 FR 73626, Nov. 29, 2010]
Sec. 414.806 Penalties associated with the failure to submit timely
and accurate ASP data.
Section 1847A(d)(4) specifies the penalties associated with
misrepresentations associated with ASP data. If the Secretary determines
that a manufacturer has made a misrepresentation in the reporting of ASP
data, a civil money penalty in an amount of up to $10,000 may be applied
for each price misrepresentation and for each day in which the price
misrepresentation was applied. Section 1927(b)(3)(C) of the Act, as
amended by section 303(i)(4) of the MMA, specifies the penalties
associated with a manufacturer's failure to submit timely information or
the submission of false information.
Subpart K_Payment for Drugs and Biologicals Under Part B
Source: 69 FR 66424, Nov. 15, 2004, unless otherwise noted.
Sec. 414.900 Basis and scope.
(a) This subpart implements sections 1842(o), 1847A, and 1847B of
the Act and outlines two payment methodologies applicable to drugs and
biologicals covered under Medicare Part B that are not paid on a cost or
prospective payment system basis.
(b) Examples of drugs that are subject to the requirements specified
in this subpart are:
(1) Drugs furnished incident to a physician's service; durable
medical equipment (DME) drugs.
(2) Separately billable drugs at independent dialysis facilities not
under the ESRD composite rate.
(3) Statutorily covered drugs, for example--
(i) Influenza.
(ii) Pneumococcal and Hepatitis B vaccines.
(iii) Antigens.
(iv) Hemophilia blood clotting factor.
(v) Immunosuppressive drugs.
(vi) Certain oral anti-cancer drugs.
[69 FR 66424, Nov. 15, 2004, as amended at 70 FR 39093, July 6, 2005]
Sec. 414.902 Definitions.
As used in this subpart, unless the context indicates otherwise--
Approved CAP vendor means an entity that has been awarded a contract
by CMS to participate in the competitive acquisition program under 1847B
of the Act.
Bid means an offer to furnish a CAP drug within a category of CAP
drugs in a competitive acquisition area for a particular price and time
period.
Biosimilar biological product means a biological product approved
under an abbreviated application for a license of a biological product
that relies in part on data or information in an application for another
biological product licensed under section 351 of the Public Health
Service Act (PHSA) as defined at section 1847A(c)(6)(H) of the Act.
CAP drug means a physician-administered drug or biological furnished
on or after January 1, 2006 described in section 1842(o)(1)(C) of the
Act and supplied by an approved CAP vendor under the CAP as provided in
this subpart.
Competitive acquisition area means a geographic area established by
the Secretary for purposes of implementing the CAP required by section
1847B of the Act.
Competitive acquisition program (CAP) means a program as defined
under section 1847B of the Act.
Designated carrier means an entity assigned by CMS to process and
pay claims for drugs and biologicals under the CAP.
Drug means both drugs and biologicals.
Emergency delivery means delivery of a CAP drug within one business
day in appropriate shipping and packaging, in
[[Page 124]]
all areas of the United States and its territories, with the exception
of the Pacific Territories. In the Pacific Territories, emergency
delivery means delivery of a CAP drug within 5 business days in
appropriate shipping and packaging. In each case, this timeframe shall
be reduced if product stability requires it, meaning that the
manufacturer's labeling instructions, drug compendia, or specialized
drug stability references indicate that a shorter delivery timeframe is
necessary to avoid adversely affecting the product's integrity, safety,
or efficacy.
Emergency situation means, for the purposes of the CAP, an
unforeseen occurrence or situation determined by the participating CAP
physician, in his or her clinical judgment, to require prompt action or
attention for purposes of permitting the participating CAP physician to
use a drug from his or her own stock, if the other requirements of Sec.
414.906(e) are met.
Local carrier means an entity assigned by CMS to process and pay
claims for administration of drugs and biologicals under the CAP.
Manufacturer's average sales price means the price calculated and
reported by a manufacturer under part 414, subpart J of this chapter.
Multiple source drug means a drug described by section
1847A(c)(6)(C) of the Act.
Pacific Territories means, for purposes of the CAP, American Samoa,
Guam, or the Northern Mariana Islands.
Participating CAP physician means a physician electing to
participate in the CAP, as described in this subpart. The participating
CAP physician must complete and sign the participating CAP physician
election agreement. Physicians who do not participate in Medicare but
who elect to participate in the CAP must agree to accept assignment for
CAP drug administration claims.
Participating CAP physician election agreement means the agreement
that the physician signs to notify CMS of the physician's election to
participate in the CAP and to agree to the terms and conditions of CAP
participation as set forth in this subpart.
Prescription order means a written order submitted by the
participating CAP physician to the approved CAP vendor that meets the
requirements of this subpart.
Reference biological product means the biological product licensed
under such section 351 of the PHSA that is referred to in the
application of the biosimilar biological product as defined at section
1847A(c)(6)(I) of the Act.
Routine delivery means delivery of a drug within 2 business days in
appropriate shipping and packaging in all areas of the United States and
its territories, with the exception of the Pacific Territories. In the
Pacific Territories, routine delivery of drug means delivery of a CAP
drug within 7 business days in appropriate shipping and packaging. In
each case, this timeframe will be reduced if product stability requires
it, meaning that the manufacturer's labeling instructions, drug
compendia, or specialized drug stability references indicate that a
shorter delivery timeframe is necessary to avoid adversely affecting the
product's integrity, safety, or efficacy.
Single source drug means a drug described by section 1847A(c)(6)(D)
of the Act.
Timely delivery means delivery of a CAP drug within the defined
routine and emergency delivery timeframes. Compliance with timely
delivery standards is also a factor for evaluation of potential and
approved CAP vendors.
Unit is defined as in part 414, subpart J of this chapter.
Wholesale acquisition cost (WAC) means the price described by
section 1847A(c)(6)(B) of the Act.
[69 FR 66424, Nov. 15, 2004, as amended at 70 FR 39093, July 6, 2005; 75
FR 73626, Nov. 29, 2010]
Sec. 414.904 Average sales price as the basis for payment.
(a) Method of payment. Payment for a drug furnished on or after
January 1, 2005 is based on the lesser of--
(1) The actual charge on the claim for program benefits; or
(2) 106 percent of the average sales price, subject to the
applicable limitations specified in paragraph (d) of this section or
subject to the exceptions described in paragraph (e) of this section.
(3) For purposes of this paragraph--
[[Page 125]]
(i) CMS calculates an average sales price payment limit based on the
amount of product included in a vial or other container as reflected on
the FDA-approved label.
(ii) Additional product contained in the vial or other container
does not represent a cost to providers and is not incorporated into the
ASP payment limit.
(iii) No payment is made for amounts of product in excess of that
reflected on the FDA-approved label.
(b) Multiple source drugs--(1) Average sales prices. The average
sales price for all drug products included within the same multiple
source drug billing and payment code is the volume-weighted average of
the manufacturers' average sales prices for those drug products.
(2) Calculation of the average sales price. (i) For dates of service
before April 1, 2008, the average sales price is determined by--
(A) Computing the sum of the products (for each National Drug Code
assigned to the drug products) of the manufacturer's average sales price
and the total number of units sold; and
(B) Dividing that sum by the sum of the total number of units sold
for all NDCs assigned to the drug products.
(ii) For dates of service on or after April 1, 2008, the average
sales price is determined by--
(A) Computing the sum of the products (for each National Drug Code
assigned to such drug products) of the manufacturer's average sales
price, determined by the Secretary without dividing such price by the
total number of billing units for the National Drug Code for the billing
and payment code and the total number of units sold; and
(B) Dividing the sum determined under clause (A) by the sum of the
products (for each National Drug Code assigned to such drug products) of
the total number of units sold and the total number of billing units for
the National Drug Code for the billing and payment code.
(iii) For purposes of this subsection and subsection (c), the term
billing unit means the identifiable quantity associated with a billing
and payment code, as established by CMS.
(c) Single source drugs--(1) Average sales price. The average sales
price is the volume-weighted average of the manufacturers' average sales
prices for all National Drug Codes assigned to the drug or biological
product.
(2) Calculation of the average sales price. (i) For dates of service
before April 1, 2008, the average sales price is determined by--
(A) Computing the sum of the products (for each National Drug Code
assigned to the drug product) of the manufacturer's average sales price
and the total number of units sold; and
(B) Dividing that sum by the sum of the total number of units sold
for all NDCs assigned to the drug product.
(ii) For dates of service on or after April 1, 2008, the average
sales price is determined by--
(A) Computing the sum of the products (for each National Drug Code
assigned to such drug products) of the manufacturer's average sales
price, determined by the Secretary without dividing such price by the
total number of billing units for the National Drug Code for the billing
and payment code and the total number of units sold; and
(B) Dividing the sum determined under clause (A) by the sum of the
products (for each National Drug Code assigned to such drug products) of
the total number of units sold and the total number of billing units for
the National Drug Code for the billing and payment code.
(d) Limitations on the average sales price--(1) Wholesale
acquisition cost for a single source drug. The payment limit for a
single source drug product is the lesser of 106 percent of the average
sales price for the product or 106 percent of the wholesale acquisition
cost for the product.
(2) Payment limit for a drug furnished to an end-stage renal disease
patient. (i) Effective for drugs and biologicals furnished in 2005, the
payment for such drugs and biologicals, including erythropoietin,
furnished to an end-stage renal disease patient that is separately
billed by an end-stage renal disease facility and not paid on a cost
basis is acquisition cost as determined by the Inspector General report
as required by section 623(c) of the Medicare Prescription Drug,
Improvement, and Modernization Act of 2003 inflated by the
[[Page 126]]
percentage increase in the Producer Price Index.
(ii) Except as provided in paragraph (a) of this section, the
payment for drugs and biologicals, furnished to an end-stage renal
disease patient that is separately billed by an end-stage renal disease
facility, is based on 106 percent of the average sales price.
(iii) Effective for drugs and biologicals furnished in CY 2006 and
subsequent calendar years, the payment for such drugs and biologicals
furnished in connection with renal dialysis services and separately
billed by freestanding and hospital-based renal dialysis facilities not
paid on a cost basis is the amount determined under section 1847A of the
Act.
(3) Widely available market price and average manufacturer price. If
the Inspector General finds that the average sales price exceeds the
widely available market price or the average manufacturer price by the
applicable threshold percentage specified in paragraph (d)(3)(iii) or
(iv) of this section, the Inspector General is responsible for informing
the Secretary (at such times as specified by the Secretary) and the
payment amount for the drug or biological will be substituted subject to
the following adjustments:
(i) The payment amount substitution will be applied at the next
average sales price payment amount calculation period after the
Inspector General informs the Secretary (at such times specified by the
Secretary) about billing codes for which the average sales price has
exceeded the average manufacturer price by the applicable threshold
percentage, and will remain in effect for 1 quarter after publication.
(ii) Payment at 103 percent of the average manufacturer price for a
billing code will be applied at such times when all of the following
criteria are met:
(A) The threshold for making price substitutions, as defined in
paragraph (d)(3)(iii) of this section is met.
(B) 103 percent of the average manufacturer price is less than the
106 percent of the average sales price for the quarter in which the
substitution would be applied.
(C) Beginning in 2013, the drug and dosage form described by the
HCPCS code is not identified by the FDA to be in short supply at the
time that ASP calculations are finalized.
(iii) The applicable percentage threshold for average manufacturer
price comparisons is 5 percent and is reached when--
(A) The average sales price for the billing code has exceeded the
average manufacturer price for the billing code by 5 percent or more in
2 consecutive quarters, or 3 of the previous 4 quarters immediately
preceding the quarter to which the price substitution would be applied;
and
(B) The average manufacturer price for the billing code is
calculated using the same set of National Drug Codes used for the
average sales price for the billing code.
(iv) The applicable percentage threshold for widely available market
price comparisons is 5 percent.
(e) Exceptions to the average sales price--(1) Vaccines. The payment
limits for hepatitis B vaccine furnished to individuals at high or
intermediate risk of contracting hepatitis B (as determined by the
Secretary), pneumococcal vaccine, and influenza vaccine and are
calculated using 95 percent of the average wholesale price.
(2) Infusion drugs furnished through a covered item of durable
medical equipment. The payment limit for an infusion drug furnished
before January 1, 2017, through a covered item of durable medical
equipment is calculated using 95 percent of the average wholesale price
in effect on October 1, 2003.
(3) Blood and blood products. In the case of blood and blood
products (other than blood clotting factors), the payment limits are
determined in the same manner as the payment limits were determined on
October 1, 2003.
(4) Payment limit in a case where the average sales price during the
first quarter of sales is unavailable. In the case of a drug during an
initial period (not to exceed a full calendar quarter) in which data on
the prices for sales of the drug are not sufficiently available from the
manufacturer to compute an average sales price for the drug, the payment
limit is based on the wholesale acquisition cost or the Medicare Part B
drug payment methodology in effect on November 1, 2003.
[[Page 127]]
(5) Treatment of certain drugs. Beginning with April 1, 2008, the
payment amount for--
(i) Each single source drug or biological described in section
1842(o)(1)(G) that is treated as a multiple source drug because of the
application of section 1847A(c)(6)(C)(ii) is the lower of--
(A) The payment amount that would be determined for such drug or
biological applying section 1847A(c)(6)(C)(ii); or
(B) The payment amount that would have been determined for such drug
or biological if section 1847A(c)(6)(C)(ii) were not applied.
(ii) A multiple source drug described in section 1842(o)(1)(G)
(excluding a drug or biological that is treated as a multiple source
drug because of the application of section 1847A(c)(6)(C)(ii)) is the
lower of--
(A) The payment amount that would be determined for such drug or
biological taking into account the application of section
1847A(c)(6)(C)(ii); or
(B) The payment amount that would have been determined for such drug
or biological if section 1847A(c)(6)(C)(ii) were not applied.
(f) Except as otherwise specified (see paragraph (e)(2) of this
section) for infusion drugs, the payment limits are updated quarterly.
(g) The payment limit is computed without regard to any special
packaging, labeling, or identifiers on the dosage form or product or
package.
(h) The payment amount is subject to applicable deductible and
coinsurance.
(i) If manufacturer ASP data is not available prior to the
publication deadline for quarterly payment limits and the unavailability
of manufacturer ASP data significantly changes the quarterly payment
limit for the billing code when compared to the prior quarter's billing
code payment limit, the payment limit is calculated by carrying over the
most recent available manufacturer ASP price from a previous quarter for
an NDC in the billing code, adjusted by the weighted average of the
change in the manufacturer ASPs for the NDCs that were reported for both
the most recently available previous quarter and the current quarter.
(j) Biosimilar biological products. Effective January 1, 2016, the
payment amount for a biosimilar biological drug product (as defined in
Sec. 414.902) for all NDCs assigned to such product is the sum of the
average sales price of all NDCs assigned to the biosimilar biological
products included within the same billing and payment code as determined
under section 1847A(b)(6) of the Act and 6 percent of the amount
determined under section 1847A(b)(4) of the Act for the reference drug
product (as defined in Sec. 414.902).
[69 FR 66424, Nov. 15, 2004, as amended at 70 FR 70332, Nov. 21, 2005;
71 FR 69788, Dec. 1, 2006; 72 FR 66402, Nov. 27, 2007; 73 FR 69937, Nov.
19, 2008; 73 FR 80304, Dec. 31, 2008; 74 FR 62012, Nov. 25, 2009; 75 FR
73626, Nov. 29, 2010; 76 FR 73473, Nov. 28, 2011; 77 FR 69368, Nov. 16,
2012; 80 FR 71382, Nov. 16, 2015; 82 FR 53363, Nov. 15, 2017; 83 FR
60074, Nov. 23, 2018]
Sec. 414.906 Competitive acquisition program as the basis for payment.
(a) Program payment. Beginning in 2006, as an alternative to payment
under Sec. 414.904, payment for a CAP drug may be made through the CAP
if the following occurs:
(1) The CAP drug is supplied under the CAP by an approved CAP vendor
as specified in Sec. 414.908(b).
(2) The claim for the prescribed drug is submitted by the approved
CAP vendor that supplied the drug, and payment is made only to that
vendor.
(3) The approved CAP vendor collects applicable deductible and
coinsurance with respect to the drug furnished under the CAP only after
the drug is administered to the beneficiary.
(4) The approved CAP vendor delivers CAP drugs directly to the
participating CAP physician in unopened vials or other original
containers as supplied by the manufacturer or from a distributor that
has acquired the products directly from the manufacturer and includes
language with the shipping material stating that the drug was acquired
in a manner consistent with all statutory requirements. If the approved
CAP vendor opts to split shipments, the participating CAP physician must
be notified in writing which can be included with the initial shipment,
and each incremental shipment
[[Page 128]]
must arrive at least 2 business days before the anticipated date of
administration.
(5) The approved CAP vendor bills Medicare only for the amount of
the drug administered to the patient, and the beneficiary's coinsurance
will be calculated from the quantity of drug that is administered.
(b) Exceptions to competitive acquisition. Specific CAP drugs,
including a category of these drugs, may be excluded from the CAP if the
application of competitive bidding to these drugs--
(1) Is not likely to result in significant savings; or
(2) Is likely to have an adverse impact on access to those drugs.
(c) Computation of payment amount. Except as specified in paragraph
(c)(2) of this section, payment for CAP drugs is based on bids submitted
as a result of the bidding process as described in Sec. 414.910 of this
subpart.
(1) Single payment amount. (i) A single payment amount for each CAP
drug in the competitive acquisition area is determined on the basis of
the bids submitted and accepted and updated from the bidding period to
the beginning of the payment year.
(ii) The single payment amount is then updated quarterly based on
the approved CAP vendor's reasonable net acquisition costs for that
category as determined by CMS, and limited by the weighted payment
amount established under section 1847A of the Act across all drugs for
which a composite bid is required in the category.
(iii) The payment amount for each other drug for which the approved
CAP vendor submits a bid in accordance with Sec. 414.910 of this
subpart and each other drug that is approved by CMS for the approved CAP
vendor to furnish under the CAP is also updated quarterly based on the
approved CAP vendor's reasonable net acquisition costs for each HCPCS
code and limited by the payment amount established under section 1847A
of the Act.
(2) Updates to payment amount. (i) The first update is effective on
the first day of claims processing for the first quarter of an approved
CAP vendor's contract. The first quarterly contract update is based on
the reasonable net acquisition cost (RNAC) data reported to CMS or its
designee for any purchases of drug before the beginning of CAP claims
processing for the contract period and reported to CMS no later than 30
days before the beginning of CAP claims processing.
(ii) For subsequent quarters, each approved CAP vendor must report
to CMS or its designee RNAC data for a quarter of CAP drug purchases
within 30 days of the close of that quarter.
(iii) For all quarters, only RNAC data from approved CAP vendors
that are supplying CAP drugs under their CAP contract at the time
updates are being calculated must be used to calculate updated CAP
payment amounts.
(iv) CMS excludes such RNAC data submitted by an approved CAP vendor
if, during the time calculations are being done, CMS knows that the
approved CAP vendor will not be under contract for the applicable
quarterly update.
(v) The payment amount weights must be calculated based on the more
recent of the following:
(A) Contract bidding weights.
(B) CAP claims data.
(vi) The payment limit must be determined using the most recent
payment limits available to CMS under section 1847A of the Act.
(vii) The following payment amount update calculation must be
applied for the group of all drugs for which a composite bid is
required.
(A) The most recent previous composite payment amount for the group
is updated by--
(1) Calculating the percent change in reasonable net acquisition
costs for each approved CAP vendor;
(2) Calculating the median of all participating approved CAP
vendors' adjusted CAP payment amounts; and
(3) Limiting the payment as described in paragraph (c)(1) of this
section.
(B) The median percent change, subject to the limit described in
paragraph (c)(1) of this section, must be the update percentage for that
quarter.
(C) The single update percentage must be applied to the payment
amount for each drug in the group of drugs for which a composite bid is
required in the category.
[[Page 129]]
(viii) The following payment amount update calculation must be
applied for each of the following items: Each HCPCS code not included in
the composite bid list; Each HCPCS code added to the drug list during
the contract period; and each drug that has not yet been assigned a
HCPCS code, but for which a HCPCS code will be established.
(A) The most recent previous payment amount for each drug must be
updated by calculating the percent change in reasonable net acquisition
costs for each approved CAP vendor, then calculating the median of all
participating approved CAP vendors' adjusted CAP payment amounts.
(B) The median percent change calculated for each drug, subject to
the limit described in paragraph (c)(1) of this section, must be applied
to the payment amount for each drug.
(3) Alternative payment amount. The alternative payment amount
established under section 1847A of the Act may be used to establish
payment for a CAP drug if--
(i) The drug is properly assigned to a category established under
the CAP; and
(ii) It is a drug for which a HCPCS code must be established.
(d) Adjustments. There is an established process for adjustments to
payments to account for drugs that were billed, but which were not
administered.
(e) Resupply of participating CAP physician drug inventory. A
participating CAP physician may acquire drugs under the CAP to resupply
his or her private inventory if all of the following requirements are
met:
(1) The drugs were required immediately.
(2) The participating CAP physician could not have anticipated the
need for the drugs.
(3) The approved CAP vendor could not have delivered the drugs in a
timely manner. For purposes of this section, timely manner means
delivery within the emergency delivery timeframe, as defined in Sec.
414.902.
(4) The participating CAP physician administered the drugs in an
emergency situation, as defined in Sec. 414.902.
(f) Substitution or addition of drugs on an approved CAP vendor's
CAP drug list--(1) Short-term substitution of a CAP drug. On an
occasional basis (for a period of time less than 2 weeks), an approved
CAP vendor may agree to furnish a substitute NDC within a HCPCS code on
the approved CAP vendor's CAP drug list if the approved CAP vendor--
(i) Is willing to accept the payment amount that was established for
the HCPCS code under this section; and
(ii) Obtains the participating CAP physician's prior approval.
(2) Long-term substitution or addition of a CAP drug. An approved
CAP vendor may submit a request, as specified in paragraph (f)(3) of
this section, for approval to substitute an NDC supplied by the approved
CAP vendor for another NDC within the same HCPCS code or to add an NDC
to the approved CAP vendor's drug list, if at least one of the following
criteria is met:
(i) Proposed substitution of an NDC for a period of 2 weeks or
longer.
(ii) Proposed addition of one or more NDCs within a HCPCS code
included in the CAP drug category specified by CMS or on the approved
CAP vendor's approved CAP drug list.
(iii) Proposed addition of--
(A) One or more newly issued HCPCS codes; or
(B) One of the following single indication orphan drug J codes or
their updates: J0205, J0256, J9300, J1785, J2355, J3240, J7513, J9010,
J9015, J9017, J9160, J9216.
(iv) Beginning January 1, 2007, the proposed addition of a drug(s)
that has not yet been assigned a HCPCS code, but for which a HCPCS code
must be established.
(v) On or after January 1, 2010, the proposed addition of drugs with
similar therapeutic uses to drugs already supplied under the CAP by the
approved CAP vendor(s).
(3) Requesting the addition or substitution of CAP drug. An approved
CAP vendor that meets the one of the criteria specified in paragraph
(f)(2) must submit a written request to CMS or its designee. The request
must--
(i) Specify the NDC(s) and the respective HCPCS code that is to be
added or substituted.
[[Page 130]]
(ii) Address the rationale for the substitution or addition of the
NDC(s) or the addition of the HCPCS code(s) as applicable; and
(iii) Address the impact of the substitution of the NDC(s) or the
addition of the NDC(s) or HCPCS code(s), or both on--
(A) Patient and drug safety;
(B) Drug waste; and
(C) The potential for cost savings.
(iv) In the case of additions requested under paragraph (f)(2)(v) of
this section, address and document the need for such an expansion based
on demand for the product(s).
(4) Approval of a request(s). CMS or its designee notifies the
approved CAP vendor of its decision.
(i) Except as specified in paragraph (f)(4)(ii) of this section, an
approved request is effective at the beginning of the next calendar
quarter.
(ii) Approved substitutions for request based on a drug shortage or
other exigent circumstance may become effective immediately provided
that--
(A) CMS approves the immediate substitution; and
(B) The approved CAP vendor's notifies its CAP participating
physicians of the substitution immediately following CMS approval.
(5) Payment for an approved drug change(s). The payment for--
(i) Substituted or added CAP drugs that are within a HCPCS code for
which payment is computed under paragraph (c)(1) of this section is the
single payment for that HCPCS code, as determined and updated in
accordance with paragraph (c)(1) of this section; or
(ii) Added CAP drugs that are not within a HCPCS code for which
payment is computed under paragraph (c)(1) of this section is specified
under paragraph (c)(2) of this section.
(g) Deletion of drugs on an approved CAP vendor's CAP drug list.
Deletion of drugs on an approved CAP vendor's CAP drug list due to
unavailability requires a written request and approval as described in
paragraphs (f)(3)(i) through (iii) and (f)(4) of this section.
[70 FR 39094, July 6, 2005, as amended at 70 FR 70333, Nov. 21, 2005; 71
FR 9460, Feb. 24, 2006; 74 FR 62012, Nov. 25, 2009]
Sec. 414.908 Competitive acquisition program.
(a) Participating CAP physician selection of an approved CAP vendor.
(1) CMS provides the participating CAP physician with a process for the
selection of an approved CAP vendor on an annual basis, with exceptions
as specified in Sec. 414.908(a)(2). Participating CAP physicians will
also receive information about the CAP in the enrollment process for
Medicare participation set forth in section 1842(h) of the Act.
(2) A participating CAP physician may select an approved CAP vendor
outside the annual selection process or opt out of the CAP for the
remainder of the annual selection period when--
(i) The selected approved CAP vendor ceases participation in the
CAP;
(ii) The physician leaves a group practice participating in CAP;
(iii) The participating CAP physician relocates to another
competitive acquisition area; or
(iv) The approved CAP vendor refuses to ship to the participating
CAP physician because the conditions of Sec. 414.914(i) have been met
(if this subparagraph (a)(2)(iv) applies, the physician can withdraw
from the CAP category for the remainder of the year immediately upon
notice to CMS and the approved CAP vendor); or
(v) Other exigent circumstances defined by CMS are present,
including--
(A) If, up to and including 60 days after the effective date of the
physician's CAP election agreement, the participating CAP physician
submits a written request to the designated carrier to terminate the CAP
election agreement because CAP participation imposes a burden on the
physician's practice. The written request must document the burden. The
designated carrier will process the participating CAP physician's
request and CMS will approve or deny the request under the dispute
resolution process as specified under Sec. 414.917 of this subpart.
(B) If, more than 60 days after the effective date of the
physician's CAP election agreement, the participating CAP physician
submits a written request to the designated carrier to terminate the CAP
election agreement because, based on a change in circumstances of which
the participating
[[Page 131]]
CAP physician was not previously aware, CAP participation imposes a
burden on the physician's practice. The written request must document
the burden. The designated carrier will process the participating CAP
physician's request and CMS will approve or deny the request under the
dispute resolution process as specified under Sec. 414.917 of this
subpart.
(3) The physician participating in the CAP--
(i) Elects to use an approved CAP vendor for the drug category and
area as set forth in Sec. 414.908(b);
(ii) Completes and signs the CAP election agreement;
(iii) Submits a written prescription order to the approved CAP
vendor with complete patient information for patients new to the
approved CAP vendor or when information changes. Abbreviated information
may be sent on all subsequent orders for a patient for which the
approved CAP vendor has previously received complete information and
that has no changes to the original information. Prescription orders may
be initiated by telephone, with a follow-up written order provided
within 8 hours for routine deliveries and immediately for emergency
deliveries;
(iv) Does not receive payment for the CAP drug;
(v) Except where applicable State pharmacy law prohibits it,
provides the following information to the approved CAP vendor to
facilitate collection of applicable deductible and coinsurance as
described in Sec. 414.906(a)(3):
(A) Date of order.
(B) Beneficiary name, address, and phone number.
(C) Physician identifying information:
Name, practice location/shipping address, group practice information
(if applicable), PIN, and UPIN.
(D) Drug name.
(E) Strength.
(F) Quantity ordered.
(G) Dose.
(H) Frequency/instructions.
(I) Anticipated date of administration.
(J) Beneficiary Medicare information/Health insurance (HIC) number.
(K) Supplementary insurance information (if applicable).
(L) Medicaid information (if applicable).
(M) Additional patient information: date of birth, allergies,
height/weight, ICD-9-CM (if necessary).
(vi) Agrees to accept the particular National Drug Codes (NDCs)
supplied by the approved CAP vendor for the duration of the
participating CAP physician's enrollment with the approved CAP vendor,
subject to paragraphs (a)(3)(vii) and (a)(3)(xiv) of this section. By
electing to participate with an approved CAP vendor, the participating
CAP physician also agrees to accept the changes to the approved CAP
vendor's CAP drug list that have been approved in accordance with Sec.
414.906(f).
(vii) Agrees to place routine orders for CAP drugs at the HCPCs
level, except when medical necessity requires a particular formulation
on the approved CAP vendor's CAP drug list. Medical necessity must be
documented. When the conditions of this paragraph are met, the
participating CAP physician may submit a prescription order to the
approved CAP vendor that specifies the NDC.
(viii) Notifies the approved CAP vendor when a drug is not
administered or a smaller amount was administered than was originally
ordered. The participating CAP physician and the approved CAP vendor
agree on how to handle the unused CAP drug. If it is agreed that the
participating CAP physician will maintain the CAP drug in his inventory
for administration at a later date, the participating CAP physician
submits a new prescription order at that time. This prescription order
specifies that the CAP drug is being obtained from the participating CAP
physician's CAP inventory and shipment should not occur;
(ix) Maintains a separate electronic or paper inventory for each CAP
drug obtained;
(x) Agrees to file the Medicare claim within 30 calendar days of the
date of drug administration.
(xi) Agrees to submit documentation such as medical records or
certification, as necessary, to support payment for a CAP drug;
[[Page 132]]
(xii) Agrees not to transport CAP drugs from one practice location
or place of service to another location except in accordance with a
written agreement between the participating CAP physician and the
approved CAP vendor that requires that drugs are not subjected to
conditions that will jeopardize their integrity, stability, and/or
sterility while being transported.
(xiii) Agrees to provide the CMS-developed CAP fact sheet to
beneficiaries; and
(xiv) May receive payment under the ASP system when medical
necessity requires a certain brand or formulation of a drug that the
approved CAP vendor has not been contracted to furnish under the CAP.
(4) Physician group practices. If a physician group practice using a
group billing number(s) elects to participate in the CAP, all physicians
in the group are considered to be participating CAP physicians when
using the group's billing number(s).
(b) Program requirements. (1) CMS selects approved CAP vendors
through a competition among entities based on the following:
(i) Submission of the bid prices using the OMB-approved Vendor
Application and Bid Form for CAP drugs within the category and
competitive acquisition area that--
(A) Places the vendor among the qualified bidders with the lowest
five composite bids; and
(B) Does not exceed the weighted payment amount established under
section 1847A of the Act across all drugs in that category.
(ii) Ability to ensure product integrity.
(iii) Customer service/Grievance process.
(iv) At least 3 years experience in furnishing Part B injectable
drugs.
(v) Financial performance and solvency.
(vi) Record of integrity and the implementation of internal
integrity measures.
(vii) Internal financial controls.
(viii) Acquisition of all CAP drugs directly from the manufacturer
or from a distributor that has acquired the products directly from the
manufacturer.
(ix) Maintenance of appropriate licensure to supply CAP drugs in
States in which they are supplying CAP drugs.
(x) Cost-sharing assistance as described in Sec. 414.914(g).
(xi) Other factors as determined by CMS.
(2) Approved CAP vendors must also meet the contract requirements
under Sec. 414.914.
(c) Additional considerations. CMS may refuse to award a contract or
terminate an approved CAP vendor contract based upon the following:
(1) Suspension or revocation by the Federal or State government of
the entity's license for distribution of drugs, including controlled
substances.
(2) Exclusion of the entity under section 1128 of the Act from
participation in Medicare or other Federal health care programs. These
considerations are in addition to CMS' ability to terminate the approved
CAP vendor for cause as specified in Sec. 414.914(a).
(3) Past violations or misconduct related to the pricing, marketing,
distribution, or handling of drugs provided incident to a physician's
service.
(d) Multiple source drugs. In the case of multiple source drugs,
there must be a competition among entities for the acquisition of at
least one CAP drug within each billing and payment code within each
category for each competitive acquisition area.
(e) Multiple contracts for a category and area. The number of
bidding qualified entities that are awarded a contract for a given
category and area may be limited to no fewer than two.
[70 FR 39094, July 6, 2005, as amended at 70 FR 70333, Nov. 21, 2005; 72
FR 66402, Nov. 27, 2007; 74 FR 62013, Nov. 25, 2009]
Sec. 414.910 Bidding process.
(a) Entities may bid to furnish CAP drugs in all competitive
acquisition areas of the United States, or one or more specific
competitive acquisition areas.
(b) The amount of the bid for any CAP drug for a specific
competitive acquisition area must be uniform for all portions of that
competitive acquisition area.
(c) A submitted bid price must include the following:
[[Page 133]]
(1) All costs related to the delivery of the drug to the
participating CAP physician.
(2) The costs of dispensing (including shipping) of the drug and
management fees. The costs related to the administration of the drug or
wastage, spillage, or spoilage may not be included.
[70 FR 39095, July 6, 2005]
Sec. 414.912 Conflicts of interest
(a) Approved CAP vendors and applicants that bid to participate in
the CAP are subject to the following:
(1) The conflict of interest standards and requirements of the
Federal Acquisition Regulation (FAR) organizational conflict of interest
guidance, found under FAR subpart 9.5.
(2) Those requirements and standards contained in each individual
contract awarded to perform functions under section 1847B of the Act.
(b) Post-award conflicts of interest. Approved CAP vendors must have
a code of conduct that establishes policies and procedures for
recognizing and resolving conflicts of interest between the approved CAP
vendor and any entity, including the Federal Government, with whom it
does business. The code of conduct which is submitted as part of the
application must--
(1) State the need for management, employees, contractors, and
agents to comply with the approved CAP vendor's code of conduct, and
policies and procedures for conflicts of interest; and
(2) State the approved CAP vendor's expectations for management,
employees, contractors, and agents to comply with the approved CAP
vendor's code of conduct, and policies and procedures for detecting,
preventing, and resolving conflicts of interest.
[70 FR 39094, July 6, 2005]
Sec. 414.914 Terms of contract.
(a) The contract between CMS and the approved CAP vendor will be for
a term of 3 years, unless terminated or suspended earlier as provided in
this section or provided in Sec. 414.917. The contract may be
terminated--
(1) By CMS for default if the approved CAP vendor violates any term
of the contract; or
(2) In the absence of a contract violation, by either CMS or the
approved CAP vendor, if the terminating party notifies the other party
by June 30 for an effective date of termination of December 31 of that
year.
(b) The contract will provide for a code of conduct for the approved
CAP vendor that includes standards relating to conflicts of interest
standards as set forth at Sec. 414.912.
(c) The approved CAP vendor will have and implement a compliance
plan that contains policies and procedures that control program fraud,
waste, and abuse, and consists of the following minimum elements:
(1) Written policies, procedures, and standards of conduct
articulating the organization's commitment to comply with all applicable
Federal and State laws, regulations, and guidance, including, but not
limited to, the Prescription Drug Marketing Act (PDMA), the physician
self-referral (``Stark'') prohibition, the Anti-Kickback statute and the
False Claims Act.
(2) The designation of a compliance officer and compliance committee
accountable to senior management.
(3) Effective training and education of the compliance officer and
organization employees, contractors, agents, and directors.
(4) Enforcement of standards through well publicized disciplinary
guidelines.
(5) Procedures for effective internal monitoring and auditing.
(6) Procedures for ensuring prompt responses to detected offenses
and development of corrective action initiatives relating to the
organization's contract as an approved CAP vendor.
(i) If the approved CAP vendor discovers evidence of misconduct
related to payment or delivery of drugs or biologicals under the
contract, it will conduct a timely and reasonable inquiry into that
conduct.
(ii) The approved CAP vendor will conduct appropriate corrective
actions including, but not limited to, repayment of overpayments and
disciplinary actions against responsible individuals, in response to
potential violations referenced at paragraph (c)(6)(i) of this section.
[[Page 134]]
(7) Procedures to voluntarily self-report potential fraud or
misconduct related to the CAP to the appropriate government agency.
(d) The contract must provide for disclosure of the approved CAP
vendor's reasonable, net acquisition costs for a specified period of
time, not to exceed quarterly.
(e) The contract must provide for appropriate adjustments as
described in Sec. 414.906(c)(1).
(f) Under the terms of the contract, the approved CAP vendor must
also--
(1) Have sufficient arrangements to acquire and deliver CAP drugs
within the category in the competitive acquisition area specified by the
contract;
(2) Have arrangements in effect for shipment at least 5 weekdays
each week of CAP drugs under the contract, including the ability to
comply with the routine and emergency delivery timeframes defined in
Sec. 414.902;
(3) Have procedures in place to address and resolve complaints of
participating CAP physicians and individuals and inquiries regarding
shipment of CAP drugs;
(4) Have a grievance and appeals process for dispute resolution;
(5) Respond within 2 business days to any inquiry, or sooner if the
inquiry is related to drug quality;
(6) Staff a toll-free telephone line from 8:30 a.m. or earlier and
until 5 p.m. or later for all time zones served in the continental
United States by the CAP vendor on business days (Monday through Friday
excluding Federal holidays) to provide customer assistance, and
establish reasonable hours of operation for Hawaii, Alaska, Puerto Rico,
and the other U.S. territories;
(7) Staff an emergency toll-free telephone line for weekend and
evening access when the call center is closed, and determine what hours
on Saturday and Sunday the call center is staffed and which hours a
toll-free emergency line is activated; and
(8) Include assistance for the disabled, the hearing impaired, and
Spanish-speaking inquirers in all customer service operations.
(9) Meet applicable licensure requirements in each State in which it
supplies drugs under the CAP;
(10) Be enrolled in Medicare as a participating supplier;
(11) Comply with all applicable Federal and State laws, regulations
and guidance related to the prevention of fraud and abuse;
(12) Supply CAP drugs upon receipt of a prescription order to all
participating CAP physicians who have selected the approved CAP vendor,
except when the conditions of paragraph (h) of this section or Sec.
414.916(b) of this subpart are met;
(13) Provide direct notification to participating CAP physicians
enrolled with them of updates to the approved CAP vendor's CAP drug list
on a quarterly basis. Changes must be disseminated at least 30 days
before the approved changes are due to take effect, unless immediate
notification as described in Sec. 414.906(f)(4) is required. The
approved CAP vendor's entire CAP drug list must be disseminated at least
once yearly; and approved CAP vendors must make a complete list that
incorporates the most recent updates available to physicians on an
ongoing basis. CMS posts on its web site the updated CAP drug lists for
each approved CAP vendor.
(14) Ensure that subcontractors who are involved in providing
services under the approved CAP contractor's CAP contract meet all
requirements and comply with all laws and regulations relating to the
services they provide under the CAP program. Notwithstanding any
relationship the CAP vendor may have with any subcontractor, the
approved CAP vendor maintains ultimate responsibility for adhering to
and otherwise fully complying with all terms and conditions of its
contract with CMS;
(15) Comply with product integrity and record keeping requirements
including but not limited to drug acquisition, handling, storage,
shipping, drug waste, and return processes; and
(16) Comply with such other terms and conditions as CMS may specify
in the CAP contract consistent with section 1847B of the Act.
(g) Under the terms of the contract, the approved CAP vendor must
provide assistance to beneficiaries experiencing financial difficulty in
paying their
[[Page 135]]
cost-sharing amounts through any one or all of the following:
(1) Referral to a bona fide and independent charitable organization.
(2) Implementation of a reasonable payment plan.
(3) A full or partial waiver of the cost-sharing amount after
determining in good faith that the individual is in financial need or
the failure of reasonable collection efforts, provided that the waiver
meets all of the requirements of section 1128A(i)(6)(A) of the Act and
the corresponding regulations at paragraph (1) of the definition of
``Remuneration'' in Sec. 1003.101 of this title. The availability of
waivers may not be advertised or be made as part of a solicitation.
Approved CAP vendors must inform beneficiaries that they generally make
available the categories of assistance described in paragraphs (g)(1),
(g)(2), and (g)(3) of this section. In no event may the approved CAP
vendor include or make any statements or representations that promise or
guarantee that beneficiaries receive cost-sharing waivers.
(h) The approved CAP vendor must verify drug administration prior to
collection of any applicable cost sharing amount.
(1) The approved CAP vendor documents, in writing, the following
information necessary to verify drug administration:
(i) Beneficiary name.
(ii) Health insurance number.
(iii) Expected date of administration.
(iv) Actual date of administration.
(v) Identity of the participating CAP physician.
(vi) Prescription order number.
(vii) Identity of the individuals who supply and receive the
information.
(viii) Dosage supplied.
(ix) Dosage administered.
(2) If the information is obtained verbally, the approved CAP vendor
must also maintain the following information:
(i) The identities of individuals who exchanged the information.
(ii) The date and time that the information was obtained.
(3) The approved CAP vendor must provide this information to CMS or
the beneficiary upon request.
(i) The approved CAP vendor must comply with the following
procedures before it may refuse to make further shipments of CAP drugs
to a participating CAP physician on behalf of a beneficiary:
(1) Subsequent to receipt of payment by Medicare, or the
verification of drug administration by the participating CAP physician,
the approved CAP vendor must bill any applicable supplemental insurance
policies.
(2) An approved CAP vendor that has received payment from the
designated carrier for CAP drugs that have not been administered must
promptly refund payment for such drugs to the designated carrier and
must refund any coinsurance and deductible collected from the
beneficiary and his or her supplemental insurer.
(3) At the time of billing the beneficiary, or the participating CAP
physician's presentation of the bill on behalf of the approved CAP
vendor, the approved CAP vendor must inform the beneficiary of any types
of cost-sharing assistance that may be available consistent with the
requirements of section 1128A(a)(5) of the Act and Sec. 414.914(g).
(4) If the beneficiary demonstrates a financial need, the approved
CAP vendor must follow the conditions outlined in paragraph (g) of this
section.
(5) For purposes of paragraph (i) of this section delivery means
postmark date, or the date the coinsurance bill or notice was presented
to the beneficiary by the participating CAP physician on behalf of the
approved CAP vendor.
(i) Except as specified in paragraph (i)(5)(ii) of this section, if
after 45 days from delivery of the approved CAP vendor's bill to the
beneficiary, the beneficiary's cost-sharing obligation remains unpaid,
the approved CAP vendor may refuse further shipments to the
participating CAP physician for that beneficiary.
(ii) If the beneficiary has requested cost-sharing assistance within
45 days of receiving delivery of the approved CAP vendor's bill,
provisions of paragraphs (i)(6), (i)(7), or (i)(8) of this section,
apply.
(6) If the approved CAP vendor implements a reasonable payment plan,
as
[[Page 136]]
specified in Sec. 414.914(g)(2), the approved CAP vendor must continue
to ship CAP drugs for the beneficiary, as long as the beneficiary
remains in compliance with the payment plan and makes an initial payment
under the plan within 15 days after the delivery of the approved CAP
vendor's written notice to the beneficiary offering the payment plan.
(7) If the approved CAP vendor has waived the cost-sharing
obligations in accordance with section 1128A of the Act and Sec.
414.914(g)(3), the approved CAP vendor may not refuse to ship drugs for
that beneficiary.
(8) If the approved CAP vendor refers the beneficiary to a bona fide
and independent charity in accordance with Sec. 414.914(g)(1), the
approved CAP vendor may refuse to ship drugs if the past due balance is
not paid 15 days after the date of delivery of the approved CAP vendor's
written notice to the beneficiary containing the referral for cost-
sharing assistance.
(9) The approved CAP vendor may refuse to make further shipments to
that participating CAP physician on behalf of the beneficiary for the
lesser of the end of the calendar year or until the beneficiary's
balance is paid in full.
[70 FR 39096, July 6, 2005, as amended at 70 FR 70333, Nov. 21, 2005; 72
FR 66403, Nov. 27, 2007; 74 FR 62013, Nov. 25, 2009]
Sec. 414.916 Dispute resolution for vendors and beneficiaries.
(a) General rule. Cases of an approved CAP vendor's dissatisfaction
with denied drug claims are resolved through a voluntary alternative
dispute resolution process delivered by the designated carrier, and a
reconsideration process provided by CMS.
(b) Dispute resolution. (1) When an approved CAP vendor is not paid
on claims submitted to the designated carrier, the vendor may appeal to
the designated carrier to counsel the responsible participating CAP
physician on his or her agreement to file a clean claim and pursue an
administrative appeal in accordance with subpart H of part 405 of this
chapter. If problems persist, the approved CAP vendor may ask the
designated carrier to--
(i) Review the participating CAP physician's performance; and
(ii) Potentially recommend to CMS that CMS suspend the participating
CAP physician's CAP election agreement.
(2) The designated carrier--
(i) Gathers information from the local carrier, the participating
CAP physician, the beneficiary, and the approved CAP vendor; and
(ii) Makes a recommendation to CMS on whether the participating CAP
physician has been filing his or her CAP drug administration claims in
accordance with the requirements for physician participation in the CAP
as set forth in Sec. 414.908(a)(3). The recommendation will include
numbered findings of fact.
(3) CMS will review the recommendation of the designated carrier and
gather relevant additional information from the participating CAP
physician before deciding whether to suspend the participating CAP
physician's CAP election agreement. A suspension commencing before
October 1 will conclude on December 31 of the same year. A suspension
commencing on or after October 1 will conclude on December 31 of the
next year.
(4) Upon notification from CMS of a participating CAP physician's
suspension from the program, the approved CAP vendor must cease delivery
of CAP drugs to the suspended participating CAP physician until the
suspension has been lifted.
(5) The participating CAP physician may appeal that suspension by
requesting a reconsideration of CMS' decision. The reconsideration will
address whether the participating CAP physician's denied claims and
appeals were the result of the participating CAP physician's failure to
participate in accordance with the requirements of Sec. 414.908(a)(3).
(c) Reconsideration--(1) Right to a reconsideration. A participating
CAP physician dissatisfied with a determination that his or her CAP
election agreement has been suspended by CMS or a determination under
Sec. 414.917(d) denying the participating CAP physician's request to
terminate participation in the CAP under Sec. 414.908(a)(v) is entitled
to a reconsideration as provided in this subpart.
[[Page 137]]
(2) Eligibility for reconsideration. CMS reconsiders any
determination to suspend a participating CAP physician's election
agreement if the participating CAP physician files a written request for
reconsideration in accordance with paragraphs (c)(3) and (c)(4) of this
section.
(3) Manner and timing of request for reconsideration. A
participating CAP physician who is dissatisfied with a CMS decision to
suspend his or her CAP election agreement may request a reconsideration
of the decision by filing a request with CMS. The request must be filed
within 30 days of receipt of the CMS decision letter notifying the
participating CAP physician of CMS' decision to suspend his or her CAP
election agreement. From the date of receipt of the decision letter
until the day the reconsideration determination is final, the ASP
payment methodology under section 1847A of the Act applies to the
physician.
(4) Content of request. The request for reconsideration must
specify--
(i) The findings or issues with which the participating CAP
physician disagrees;
(ii) The reasons for the disagreement;
(iii) A recital of the facts and law supporting the participating
CAP physician's position;
(iv) Any supporting documentation; and
(v) Any supporting statements from approved CAP vendors, local
carriers, or beneficiaries.
(5) Withdrawal of request for reconsideration. A participating CAP
physician may withdraw his or her request for reconsideration at any
time before the issuance of a reconsideration determination.
(6) Discretionary informal hearing. In response to a request for
reconsideration, CMS may, at its discretion, provide the participating
CAP physician the opportunity for an informal hearing that--
(i) Is conducted by a hearing officer appointed by the director of
the CMS Center for Medicare Management or his or her designee; and
(ii) Provides the participating CAP physician the opportunity to
present, by telephone or in person, evidence to rebut CMS' decision to
suspend or terminate a participating CAP physician's CAP election
agreement.
(7) Informal hearing procedures. (i) CMS provides written notice of
the time and place of the informal hearing at least 10 days before the
scheduled date.
(ii) The informal reconsideration hearing will be conducted in
accordance with the following procedures:
(A) The hearing is open to CMS and the participating CAP physician
requesting the reconsideration, including--
(1) Authorized representatives;
(2) Technical advisors (individuals with knowledge of the facts of
the case or presenting interpretation of the facts);
(3) Representatives from the local carrier;
(4) Representatives from the approved CAP vendor; and
(5) Legal counsel.
(B) The hearing is conducted by the hearing officer who receives
relevant testimony;
(C) Testimony and other evidence may be accepted by the hearing
officer even though it would be inadmissible under the rules of evidence
applied in Federal courts;
(D) Either party may call witnesses from among those individuals
specified in paragraph (c)(7)(ii)(A) of this section; and
(E) The hearing officer does not have the authority to compel by
subpoena the production of witnesses, papers, or other evidence.
(8) Hearing officer's findings. (i) Within 30 days of the hearing
officer's receipt of the hearing request, the hearing officer presents
the findings and recommendations to the participating CAP physician who
requested the reconsideration. If the hearing officer decides to conduct
an in-person or telephone hearing, the hearing officer will send a
hearing notice to the participating CAP physician within 10 days of
receipt of the hearing request, and the findings and recommendations are
due to the participating CAP physician within 30 days of the hearing's
conclusion.
(ii) The written report of the hearing officer includes separate
numbered
[[Page 138]]
findings of fact and the legal conclusions of the hearing officer.
(9) Final reconsideration determination. (i) The hearing officer's
decision is final unless the director of the CMS Center for Medicare
Management or his or her designee chooses to review that decision within
30 days. If the decision is favorable to the participating CAP
physician, then the participating CAP physician may resume his or her
participation in CAP. The hearing officer and the CMS official may
review decisions that are favorable or unfavorable to the participating
CAP physician.
(ii) The CMS official may accept, reject, or modify the hearing
officer's findings.
(iii) If the CMS official reviews the hearing officer's decision,
the CMS official issues a final reconsideration determination to the
participating CAP physician on the basis of the hearing officer's
findings and recommendations and other relevant information.
(iv) The reconsideration determination of the CMS official is final.
If the final decision is unfavorable to the participating CAP physician,
then the participating CAP physician's CAP election agreement is
terminated.
(d) The approved CAP vendor may not charge the beneficiary for the
full drug coinsurance amount if the designated contractor did not pay
the approved CAP vendor in full, unless a properly executed advance
beneficiary notice is in place. When a beneficiary receives an
inappropriate coinsurance bill, the beneficiary may participate in the
approved CAP vendor's grievance process to request correction of the
approved CAP vendor's file. If the beneficiary is dissatisfied with the
result of the approved CAP vendor's grievance process, the beneficiary
may request intervention from the designated carrier. This is in
addition to, rather than in place of, any other beneficiary appeal
rights. The designated carrier will first investigate the facts and then
facilitate correction to the appropriate claim record and beneficiary
file.
[70 FR 39097, July 6, 2005, as amended at 72 FR 66403, Nov. 27, 2007; 74
FR 62013, Nov. 25, 2009]
Sec. 414.917 Dispute resolution and process for suspension or termination
of approved CAP contract and termination of physician participation
under exigent circumstances.
(a) General rule. If a participating CAP physician finds an approved
CAP vendor's service, or the quality of a CAP drug supplied by the
approved CAP vendor to be unsatisfactory, then the physician may address
the issue first through the approved CAP vendor's grievance process, and
second through an alternative dispute resolution process administered by
the designated carrier and CMS. If CMS suspends an approved CAP vendor's
CAP contract for noncompliance or terminates the CAP contract in
accordance with Sec. 414.914(a), the approved CAP vendor may request a
reconsideration in accordance with paragraph (c) of this section.
(b) Dispute resolution. (1) When a participating CAP physician is
dissatisfied with an approved CAP vendor's service or the quality of a
CAP drug supplied by the approved CAP vendor, then the participating CAP
physician may use the approved CAP vendor's grievance process. If the
service or quality issues are not resolved through the grievance process
to the physician's satisfaction, then the participating CAP physician
may ask the designated carrier to--
(i) Review the approved CAP vendor's performance; and
(ii) Potentially recommend termination of the approved CAP vendor's
CAP contract.
(2) Responsibility of the designated carrier. The designated
carrier--
(i) Gathers information from the local carrier, the participating
CAP physician, the beneficiary, and the approved CAP vendor; and
(ii) Makes a recommendation to CMS on whether the approved CAP
vendor has been meeting the service and quality obligations of its CAP
contract. This recommendation will include numbered findings of fact.
(3) CMS will review the recommendation of the designated carrier
and, gather relevant additional information from the approved CAP
vendor, the participating CAP physician, the local
[[Page 139]]
carrier, and the beneficiary before deciding whether to terminate the
approved CAP vendor's CAP contract.
(4) The approved CAP vendor may appeal that termination by
requesting a reconsideration. A determination must be made as to whether
the approved CAP vendor has been meeting the service and quality
obligations of its CAP contract. The approved CAP vendor's contract will
remain suspended during the reconsideration process.
(c) Reconsideration--(1) Right to reconsideration. An approved CAP
vendor dissatisfied with a determination that its CAP contract has been
suspended or terminated by CMS is entitled to a reconsideration as
provided in this subpart.
(2) Eligibility for reconsideration. CMS will reconsider any
determination to suspend or terminate an approved CAP vendor's contract
if the approved CAP vendor files a written request for reconsideration
in accordance with paragraphs (c)(3) and (c)(4) of this section.
(3) Manner and timing of request for reconsideration. An approved
CAP vendor that is dissatisfied with a CMS decision to suspend or
terminate its CAP contract may request a reconsideration of the decision
by filing a request with CMS. The request must be filed within 30 days
of receipt of the CMS decision letter notifying the approved CAP vendor
of the suspension or termination of its CAP contract.
(4) Content of request. The request for reconsideration must
specify--
(i) The findings or issues with which the approved CAP vendor
disagrees;
(ii) The reasons for the disagreement;
(iii) A recital of the facts and law supporting the approved CAP
vendor's position;
(iv) Any supporting documentation; and
(v) Any supporting statements from participating CAP physicians, the
local carrier, or beneficiaries.
(5) Withdrawal of request for reconsideration. An approved CAP
vendor may withdraw its request for reconsideration at any time before
the issuance of a reconsideration determination.
(6) Discretionary informal hearing. In response to a request for
reconsideration, CMS may, at its discretion, provide the approved CAP
vendor the opportunity for an informal hearing that--
(i) Is conducted by a hearing officer appointed by the Director of
the CMS Center for Medicare Management or his or her designee; and
(ii) Provides the approved CAP vendor the opportunity to present, by
telephone or in person, evidence to rebut CMS' decision to suspend or
terminate the approved CAP vendor's CAP contract.
(7) Informal hearing procedures. (i) CMS will provide written notice
of the time and place of the informal hearing at least 10 days before
the scheduled date.
(ii) The informal reconsideration hearing will be conducted in
accordance with the following procedures:
(A) The hearing is open to CMS and the approved CAP vendor
requesting the reconsideration, including--
(1) Authorized representatives;
(2) Technical advisors (individuals with knowledge of the facts of
the case or presenting interpretation of the facts);
(3) Representatives from the local carriers and the designated
carrier;
(4) The participating CAP physician who requested the suspension, if
any; and
(5) Legal counsel.
(B) The hearing will be conducted by the hearing officer, who will
receive relevant testimony;
(C) Testimony and other evidence may be accepted by the hearing
officer even though it would be inadmissible under the rules of evidence
applied in Federal courts;
(D) Either party may call witnesses from among those individuals
specified in the paragraph (c)(7)(ii)(A) of this section; and
(E) The hearing officer does not have the authority to compel by
subpoena the production of witnesses, papers, or other evidence.
(8) Hearing officer's findings. (i) Within 30 days of the hearing
officer's receipt of the hearing request, the hearing officer will
present the findings and recommendations to the approved CAP vendor that
requested the reconsideration. If the hearing officer conducts a hearing
in person or by phone, the
[[Page 140]]
hearing officer will send a hearing notice to the approved CAP vendor
within 10 days of receipt of the hearing request, and the findings and
recommendations are due to the approved CAP vendor within 30 days from
of the hearing's conclusion.
(ii) The written report of the hearing officer will include separate
numbered findings of fact and the legal conclusions of the hearing
officer.
(9) Final reconsideration determination. (i) The hearing officer's
decision is final unless the Director of the CMS Center for Medicare
Management or his or her designee (CMS official) chooses to review that
decision within 30 days. If the decision is favorable to the approved
CAP vendor, then the approved CAP vendor may resume participation in
CAP. The hearing officer and the CMS official may review decisions that
are favorable or unfavorable to the approved CAP vendor.
(ii) The CMS official may accept, reject, or modify the hearing
officer's findings.
(iii) If the CMS official reviews the hearing officer's decision,
the CMS official will issue a final reconsideration determination to the
approved CAP vendor on the basis of the hearing officer's findings and
recommendations and other relevant information.
(iv) The reconsideration determination of the CMS official is final.
(d) CAP participating physicians' exigent circumstances provision.
The following process must be completed for participating CAP
physicians' requests to terminate their participation in the program
under exigent circumstances provisions described in Sec.
414.908(a)(2)(v):
(1) The designated carrier must--
(i) Determine whether a request to terminate CAP participation was
related to approved CAP vendor service, and if so, forward the issue to
the approved CAP vendor's grievance process within 1 business day of the
receipt of the request; or
(ii) Continue to investigate, consistent with Sec. 414.916(b)(2) of
this chapter, and within 2 business days of receipt, do any of the
following:
(A) Request a single, 2-business day extension. No later than the
end of any 2-business day extension, the designated carrier must make
findings and a recommendation as provided in subparagraph (B) or (C).
(B) Submit a recommendation and relevant findings to CMS that the
requesting participating CAP physician be permitted to terminate his or
her participation in the CAP.
(C) Submit a recommendation and relevant findings to CMS that the
requesting participating CAP physician not be permitted to terminate his
or her participation in the CAP.
(ii) In the case of a request made under Sec. 414.908(a)(2)(v)(B),
the designated carrier also shall include in its recommendation its
finding with respect to whether the request is based on a change in
circumstances of which the participating CAP physician was previously
unaware.
(2) CMS will consider the carrier's findings and recommendation and
may also make its own findings. As a result, CMS will--
(i) Approve or deny the request to terminate participation in the
CAP within 2 business days of receipt of the recommendation.
(ii) Communicate the decision to the appropriate Medicare
contractors and the participating CAP physician.
(3) A denial of the participating CAP physician's request to
terminate participation in the CAP must include written notification of
the right to request reconsideration under Sec. 414.916(c).
(4) Upon termination of participation in the CAP a physician must--
(i) Continue to submit claims for drugs supplied and administered
under the CAP prior to the effective date of the physician's termination
from the CAP consistent with Sec. 414.908(a) until all such claims are
timely submitted.
(ii) Return any unused CAP drugs that had not been administered to
the beneficiary prior to the effective date of the physician's
termination from the CAP to the approved CAP vendor consistent with
applicable law and regulation and any agreement with the approved CAP
vendor.
(iii) Cooperate in any post-payment review activities on claims
submitted under the CAP, as required under section 1847B(a)(3) of the
Act.
(5) An approved CAP vendor that has billed and been paid for CAP
drugs that
[[Page 141]]
have not been administered must refund any payments made by CMS or the
beneficiary and his or her supplemental insurer in accordance with Sec.
414.914(h)(3)(i)(2) of this chapter.
[70 FR 39098, July 6, 2005, as amended at 72 FR 66403, Nov. 27, 2007; 74
FR 62013, Nov. 25, 2009]
Sec. 414.918 Assignment.
Payment for a CAP drug may be made only on an assignment-related
basis.
[70 FR 39099, July 6, 2005]
Sec. 414.920 Judicial review.
The following areas under the CAP are not subject to administrative
or judicial review:
(a) The establishment of payment amounts.
(b) The awarding of vendor contracts.
(c) The establishment of competitive acquisition areas.
(d) The selection of CAP drugs.
(e) The bidding structure.
(f) The number of vendors selected.
[70 FR 39099, July 6, 2005]
Sec. 414.930 Compendia for determination of medically-accepted indications
for off-label uses of drugs and biologicals in an anti-cancer
chemotherapeutic regimen.
(a) Definitions. For the purposes of this section:
Compendium means a comprehensive listing of FDA-approved drugs and
biologicals or a comprehensive listing of a specific subset of drugs and
biologicals in a specialty compendium, for example a compendium of anti-
cancer treatment. A compendium--
(i) Includes a summary of the pharmacologic characteristics of each
drug or biological and may include information on dosage, as well as
recommended or endorsed uses in specific diseases.
(ii) Is indexed by drug or biological.
(iii) Has a publicly transparent process for evaluating therapies
and for identifying potential conflicts of interests.
Publicly transparent process for evaluating therapies means that the
process provides that the following information from an internal or
external request for inclusion of a therapy in a compendium are
available to the public for a period of not less than 5 years, which
includes availability on the compendium's Web site for a period of not
less than 3 years, coincident with the compendium's publication of the
related recommendation:
(i) The internal or external request for listing of a therapy
recommendation including criteria used to evaluate the request.
(ii) A listing of all the evidentiary materials reviewed or
considered by the compendium pursuant to the request.
(iii) A listing of all individuals who have substantively
participated in the review or disposition of the request.
(iv) Minutes and voting records of meetings for the review and
disposition of the request.
Publicly transparent process for identifying potential conflicts of
interests means that process provides that the following information is
identified and made timely available in response to a public request for
a period of not less than 5 years, coincident with the compendium's
publication of the related recommendation:
(i) Direct or indirect financial relationships that exist between
individuals or the spouse or minor child of individuals who have
substantively participated in the development or disposition of
compendia recommendations and the manufacturer or seller of the drug or
biological being reviewed by the compendium. This may include, for
example, compensation arrangements such as salary, grant, contract, or
collaboration agreements between individuals or the spouse or minor
child of individuals who have substantively participated in the review
and disposition of the request and the manufacturer or seller of the
drug or biological being reviewed by the compendium.
(ii) Ownership or investment interests between individuals or the
spouse or minor child of individuals who have substantively participated
in the development or disposition of compendia recommendations and the
manufacturer or seller of the drug or biological being reviewed by the
compendium.
(b) Process for listing compendia for determining medically-accepted
uses of
[[Page 142]]
drugs and biologicals in anti-cancer treatment. (1) The CMS process--
(i) Receives formal written requests for changes to the list of
compendia during a 30 day window beginning January 15 each year.
(ii) Publishes a listing of the timely, complete requests by March
15th and solicits public comment on the requests for 30 days. The
listing identifies the requestor and the requested action.
(iii) Considers a compendium's attainment of the MedCAC (Medicare
Evidence Development and Coverage Advisory Committee, previously known
as the MCAC--Medicare Coverage Advisory Committee) recommended desirable
characteristics of compendia (including explicit listing and
recommendations) in reviewing requests. CMS may consider additional
reasonable factors.
(iv) Considers a compendium's grading of evidence used in making
recommendations regarding off-label uses and the process by which the
compendium grades the evidence.
(v) Considers whether the publication that is the subject of the
request meets the definition of a compendium in this section.
(vi) Publishes its decision no later than 90 days after the close of
the public comment period.
(2) Exception. In addition to the annual process outlined in
paragraph (b)(1) of this section, CMS may internally generate a request
for changes to the list of compendia at any time.
(c) Written request for review. (1) CMS will review a complete,
written request that is submitted in writing, electronically or via hard
copy (no duplicate submissions) and includes the following:
(i) The full name and contact information of the requestor.
(ii) The full identification of the compendium that is the subject
of the request, including name, publisher, edition if applicable, date
of publication, and any other information needed for the accurate and
precise identification of the specific compendium.
(iii) A complete written copy of the compendium that is the subject
of the request.
(iv) The specific action that is requested of CMS.
(v) Materials that the requestor must submit for CMS review in
support of the requested action.
(vi) A single compendium as its subject.
(d) CMS may at its discretion combine and consider multiple requests
that refer to the same compendium.
(e) For the purposes of this section, publication by CMS may be
accomplished by posting on the CMS Web site.
[72 FR 66404, Nov. 27, 2007, as amended at 74 FR 62013, Nov. 25, 2009]
Subpart L_Supplying and Dispensing Fees
Sec. 414.1000 Purpose.
This subpart implements section 1842(o)(2) and section 1842(o)(6) of
the Act, as added by section 303(e)(2) of the MMA, by specifying a
supplying fee for drugs and biologicals covered under Part B of Title
XVIII of the Act that are described in sections 1861(s)(2)(J),
1861(s)(2)(Q), and 1861(s)(2)(T) of the Act.
[69 FR 66425, Nov. 15, 2004]
Sec. 414.1001 Basis of payment.
(a) Supplying fees. Beginning in CY 2006--
(1) A supplying fee of $24 is paid to a pharmacy for the first
prescription of drugs and biologicals described in sections
1861(s)(2)(J), 1861(s)(2)(Q), and 1861(s)(2)(T) of the Act, that the
pharmacy provided to a beneficiary during a 30-day period.
(2) A supplying fee of $16 is paid to a pharmacy for each
prescription following the first prescription (as specified in paragraph
(a)(1) of this section) of drugs and biologicals described in sections
1861(s)(2)(J), 1861(s)(2)(Q), and 1861(s)(2)(T) of the Act, that the
pharmacy provided to a beneficiary during a 30-day period.
(3) A separate supplying fee is paid to a pharmacy for each
prescription of drugs and biologicals described in sections
1861(s)(2)(J), 1861(s)(2)(Q), and 1861(s)(2)(T) of the Act.
(b) Supplying fees following transplant. Beginning CY 2006--(1) A
supplying fee
[[Page 143]]
of $50 is paid to pharmacy for the initial supplied prescription of
drugs and biologicals described in section 1861(s)(2)(J) of the Act,
that the pharmacy provided to a patient during the first 30-day period
following a transplant.
(2) A supplying fee of $16 is paid to a pharmacy for each
prescription following an initial prescription after a transplant (as
specified in paragraph (b)(1) of this section) of drugs and biologicals
describe in section 1861(s)(2)(J) of the Act, that the pharmacy provided
to a beneficiary during a 30-day period.
(c) 30-day dispensing fees. Beginning CY 2006--(1) A dispensing fee
of $57 is paid to a supplier to the extent that the prescription is for
the initial dispensed 30-day supply of inhalation drugs furnished
through durable medical equipment covered under section 1861(n) of the
Act, regardless of the number of partial shipments of that 30-day
supply.
(2) Except for supplied inhalation drugs that meet criteria
described in paragraph (c)(1) of this section, a dispensing fee of $33
is paid for each dispensed 30-day supply of inhalation drugs furnished
through durable medical equipment covered under section 1861(n) of the
Act, regardless of the number of partial shipments of that 30-day
supply.
(d) 90-day dispensing fee. Beginning CY 2006, a dispensing fee of
$66 is paid to a supplier for each dispensed 90-day supply of inhalation
drugs furnished through durable medical equipment covered under section
1861(n) of the Act, regardless of the number of partial shipments of
that 90-day supply.
[70 FR 70334, Nov. 21, 2005]
Subpart M_Payment for Comprehensive Outpatient Rehabilitation Facility
(CORF) Services
Source: 72 FR 66404, Nov. 27, 2007, unless otherwise noted.
Sec. 414.1100 Basis and scope.
This subpart implements sections 1834(k)(1) and (k)(3) of the Act by
specifying the payment methodology for comprehensive outpatient
rehabilitation facility services covered under Part B of Title XVIII of
the Act that are described at section 1861(cc)(1) of the Act.
Sec. 414.1105 Payment for Comprehensive Outpatient Rehabilitation Facility
(CORF) services.
(a) Payment under the physician fee schedule. Except as otherwise
specified under paragraphs (b), (c), (d), and (e) of this section
payment for CORF services, as defined under Sec. 410.100 of this
chapter, is paid the lesser of 80 percent of the following:
(1) The actual charge for the item or service; or
(2) The nonfacility amount determined under the physician fee
schedule established under section 1848(b) of the Act for the item or
service.
(b) Payment for physician services. No separate payment for
physician services that are CORF services under Sec. 410.100(a) of this
chapter will be made.
(c) Payment for supplies and durable medical equipment, prosthetic
and orthotic devices, and drugs and biologicals. Supplies and durable
medical equipment that are CORF services under Sec. 410.100(l) of this
chapter, prosthetic device services that are CORF services under Sec.
410.100(f), orthotic devices that are CORF services under Sec.
410.100(g) of this chapter and drugs and biologicals that are CORF
services under Sec. 410.100(k) of this chapter are paid the lesser of
80 percent of the following:
(1) The actual charge for the service provided that payment for such
item is not included in the payment amount for other CORF services paid
under paragraphs (a) or (d); or
(2) The amount determined under the DMEPOS fee schedule established
under part 414 subparts D and F for the item or the single payment
amount established under the DMEPOS competitive bidding program provided
that payment for such item is not included in the payment amount for
other CORF services paid under paragraphs (a) or (d).
(d) Payment for drugs and biologicals. Drugs and biologicals that
are CORF
[[Page 144]]
services under Sec. 410.100(j) of this chapter, are paid the lesser of
80 percent of the following:
(1) The actual charge for the service provided that payment for such
item is not included in the payment amount for other CORF services paid
under paragraphs (a) or (c); or
(2) The amount determined using the same methodology for drugs (as
defined in Sec. 414.704 of this chapter) described in section
1842(o)(1) of the Act provided that payment for such drug is not
included in the payment amount for other CORF services paid under
paragraphs (a) or (c).
(e) Payment for CORF services when no fee schedule amount for the
service. If there is no fee schedule amount established for a CORF
service, payment for the item or service will be the lesser of 80
percent of:
(i) The actual charge for the service provided that payment for such
item or service is not included in the payment amount for other CORF
services paid under paragraphs (a), (c), or (d) of this section.
(ii) The amount determined under the fee schedule established for a
comparable service as specified by the Secretary provided that payment
for such item or service is not included in the payment amount for other
CORF services paid under paragraphs (a), (c), or (d) of this section.
Subpart N_Value-Based Payment Modifier Under the Physician Fee Schedule
Source: 77 FR 69368, Nov. 16, 2012, unless otherwise noted.
Sec. 414.1200 Basis and scope.
(a) Basis. This subpart implements section 1848(p) of the Act by
establishing a payment modifier that provides for differential payment
starting in 2015 to a group of physicians and starting in 2017 to a
group and a solo practitioner under the Medicare Physician Fee Schedule
based on the quality of care furnished compared to cost during a
performance period.
(b) Scope. This subpart sets forth the following:
(1) The application of the value-based payment modifier.
(2) Performance and payment adjustment periods.
(3) Reporting mechanisms for the value-based payment modifier.
(4) Alignment of PQRS quality of care measures with the quality
measures for the value-based payment modifier.
(5) Additional measures for groups and solo practitioners.
(6) Cost measures.
(7) Attribution for quality of care and cost measures.
(8) Scoring methods for the value-based payment modifier.
(9) Benchmarks for quality of care measures.
(10) Benchmarks for cost measures.
(11) Composite scores.
(12) Reliability of measures.
(13) Payment adjustments.
(14) Value-based payment modifier quality-tiering scoring
methodology.
(15) Limitation of review.
(16) Inquiry process.
[77 FR 69368, Nov. 16, 2012, as amended at 79 FR 68005, Nov. 13, 2014]
Sec. 414.1205 Definitions.
As used in this subpart, unless otherwise indicated--
Accountable care organization (ACO) has the same meaning given this
term under Sec. 425.20 of this chapter.
Certified registered nurse anesthetist (CRNA) has the same meaning
given this term under section 1861(bb)(2) of the Act.
Critical access hospital has the same meaning given this term under
Sec. 400.202 of this chapter.
Electronic health record (EHR) has the same meaning given this term
under Sec. 414.92 of this chapter.
Eligible professional has the same meaning given this term under
section 1848(k)(3)(B) of the Act.
Federally Qualified Health Center has the same meaning given this
term under Sec. 405.2401(b) of this chapter.
Group of physicians (Group) means a single Taxpayer Identification
Number (TIN) with 2 or more eligible professionals, as identified by
their individual National Provider Identifier (NPI), who have reassigned
their Medicare billing rights to the TIN.
Performance period means the calendar year that will be used to
assess
[[Page 145]]
the quality of care furnished compared to cost.
Performance rate mean the calculated rate for each quality or cost
measure such as the percent of times that a particular clinical quality
action was reported as being performed, or a particular outcome was
attained, for the applicable persons to whom a measure applies as
described in the denominator for the measure.
Physician has the same meaning given this term under section 1861(r)
of the Act.
Physician assistant (PA), nurse practitioner (NP), and clinical
nurse specialist (CNS) have the same meanings given these terms under
section 1861(aa)(5) of the Act.
Physician Fee Schedule has the same meaning given this term under
part 410 of this chapter.
Physician Quality Reporting System means the system established
under section 1848(k) of the Act.
Risk score means the beneficiary risk score derived from the CMS
Hierarchical Condition Categories (HCC) model.
Solo practitioner means a single Taxpayer Identification Number
(TIN) with one eligible professional who is identified by an individual
National Provider Identifier (NPI) billing under the TIN.
Taxpayer Identification Number (TIN) has the same meaning given this
term under Sec. 425.20 of this chapter.
Value-based payment modifier means the percentage as determined
under Sec. 414.1270 by which amounts paid to a group or solo
practitioner under the Medicare Physician Fee Schedule established under
section 1848 of the Act are adjusted based upon a comparison of the
quality of care furnished to cost as determined by this subpart.
[77 FR 69368, Nov. 16, 2012, as amended at 79 FR 68005, Nov. 13, 2014;
80 FR 71382, Nov. 16, 2015]
Sec. 414.1210 Application of the value-based payment modifier.
(a) The value-based payment modifier is applicable:
(1) For the CY 2015 payment adjustment period, to physicians in
groups with 100 or more eligible professionals based on the performance
period described at Sec. 414.1215(a).
(2) For the CY 2016 payment adjustment period, to physicians in
groups with 10 or more eligible professionals based on the performance
period described at Sec. 414.1215(b).
(3) For the CY 2017 payment adjustment period and each subsequent
calendar year payment adjustment period, to physicians in groups with 2
or more eligible professionals and to physicians who are solo
practitioners based on the performance period for the payment adjustment
period as described at Sec. 414.1215.
(4) For the CY 2018 payment adjustment period, to nonphysician
eligible professionals who are physician assistants, nurse
practitioners, clinical nurse specialists, and certified registered
nurse anesthetists in groups with 2 or more eligible professionals and
to physician assistants, nurse practitioners, clinical nurse
specialists, and certified registered nurse anesthetists who are solo
practitioners based on the performance period for the payment adjustment
period as described at Sec. 414.1215.
(b) Exceptions. (1) Groups of physicians that are participating in
the Medicare Shared Savings Program, the testing of the Pioneer ACO
model, or other similar Innovation Center or CMS initiatives shall not
be subject to any adjustments under the value-based payment modifier for
CY 2015 and CY 2016.
(2) Application of the value-based payment modifier to participants
in the Shared Savings Program.
(i) For the CY 2017 payment adjustment period and each subsequent
calendar year payment adjustment period, the value-based payment
modifier is applicable to physicians in groups with 2 or more eligible
professionals and to physicians who are solo practitioners that
participate in an ACO under the Shared Savings Program during the
performance period for the payment adjustment period as described at
Sec. 414.1215. The value-based payment modifier for a group or solo
practitioner that participates in an ACO under the Shared Savings
Program
[[Page 146]]
during the performance period is determined based on paragraphs
(b)(2)(i)(A) through (D) of this section.
(A) The cost composite is classified as ``average'' under Sec.
414.1275(b).
(B) For groups and solo practitioners that participate in a Shared
Savings Program ACO that successfully reports quality data as required
by the Shared Savings Program under Sec. 425.504 of this chapter, the
quality composite score is calculated under Sec. 414.1260(a) using
quality data reported by the ACO for the performance period through the
ACO GPRO Web interface as required under Sec. 425.504(a)(1) of this
chapter or another mechanism specified by CMS and the ACO all-cause
readmission measure. Groups and solo practitioners that participate in
two or more ACOs during the applicable performance period receive the
quality composite score of the ACO that has the highest numerical
quality composite score. For the CY 2018 payment adjustment period, the
CAHPS for ACOs survey also will be included in the quality composite
score. For the CY 2017 and 2018 payment adjustment periods, for groups
and solo practitioners who participate in a Shared Savings Program ACO
that does not successfully report quality data as required by the Shared
Savings Program under Sec. 425.504 and who meet the requirements to
avoid the PQRS payment adjustment for CY 2018 by reporting to the PQRS
outside the ACO, the quality composite is classified as ``average''
under Sec. 414.1275(b).
(C) For the CY 2017 payment adjustment period, the value-based
payment modifier adjustment will be equal to the amount determined under
Sec. 414.1275 for the payment adjustment period, except that if the ACO
(or groups and solo practitioners that participate in the ACO) does not
successfully report quality data as described in paragraph (b)(2)(i)(B)
of this section for the performance period, such adjustment will be
equal to -4% for groups of physicians with 10 or more eligible
professionals and equal to -2% for groups of physicians with two to nine
eligible professionals and for physician solo practitioners. If the ACO
has an assigned beneficiary population during the performance period
with an average risk score in the top 25 percent of the risk scores of
beneficiaries nationwide, and a group of physician or physician solo
practitioner that participates in the ACO during the performance period
is classified as high quality/average cost under quality-tiering for the
CY 2017 payment adjustment period, the group or solo practitioner
receives an upward adjustment of +3 x (rather than +2 x) if the group
has 10 or more eligible professionals or +2 x (rather than +1 x) for a
solo practitioner or the group has two to nine eligible professionals.
(D) For the CY 2018 payment adjustment period, the value-based
payment modifier adjustment will be equal to the amount determined under
Sec. 414.1275 for the payment adjustment period, except that if the ACO
(or groups and solo practitioners that participate in the ACO) does not
successfully report quality data as described in paragraph (b)(2)(i)(B)
of this section for the performance period, such adjustment will be
equal to the downward payment adjustment amounts described at Sec.
414.1270(d)(1). If the ACO has an assigned beneficiary population during
the performance period with an average risk score in the top 25 percent
of the risk scores of beneficiaries nationwide, and a group or solo
practitioner that participates in the ACO during the performance period
is classified as high quality/average cost under quality-tiering for the
CY 2018 payment adjustment period, the group or solo practitioner
receives an upward adjustment of +3 x (rather than +2 x) if the group of
physicians has 10 or more eligible professionals, +2 x (rather than +1
x) for a physician solo practitioner or if the group of physicians has
two to nine eligible professionals, or +2 x (rather than +1 x) for a
solo practitioner who is a nonphysician eligible professional or if the
group consists of nonphysician eligible professionals.
(E) For the CY 2017 payment adjustment period and each subsequent
calendar year payment adjustment period, the value-based payment
modifier for groups and solo practitioners that participate in an ACO
under the Shared Savings Program during the applicable performance
period is determined as described under paragraph (b)(2) of this
[[Page 147]]
section, regardless of whether any eligible professionals in the group
or the solo practitioner also participate in an Innovation Center model
during the performance period.
(F) For groups and solo practitioners that participate in a Shared
Savings Program ACO that successfully reports quality data as required
by the Shared Savings Program under Sec. 425.504 of this chapter, the
same value-based payment modifier adjustment will be applied in the
payment adjustment period to all groups based on size as specified under
Sec. 414.1275 and solo practitioners that participated in the ACO
during the performance period.
(ii) For the CY 2018 payment adjustment period and each subsequent
calendar year payment adjustment period, the value-based payment
modifier is applicable to nonphysician eligible professionals in groups
with 2 or more eligible professionals and to nonphysician eligible
professionals who are solo practitioners that participate in an ACO
under the Shared Savings Program during the performance period for the
payment adjustment period as described at Sec. 414.1215. The value-
based payment modifier for nonphysician eligible professionals is
determined in the same manner as for physicians as described under
paragraphs (b)(2)(i)(A) through (D) of this section.
(3) Application of the value-based payment modifier to participants
in the Pioneer ACO Model and the Comprehensive Primary Care Initiative.
(i) For the CY 2017 payment adjustment period, the value-based payment
modifier is waived under section 1115A(d)(1) of the Act for physicians
in groups with 2 or more eligible professionals and for physicians who
are solo practitioners that participate in the Pioneer ACO Model or the
Comprehensive Primary Care (CPC) Initiative during the performance
period for the payment adjustment period as described at Sec. 414.1215.
(ii) For the CY 2018 payment adjustment period, the value-based
payment modifier is waived under section 1115A(d)(1) of the Act for
physicians and nonphysician eligible professionals in groups with 2 or
more eligible professionals and for physicians and nonphysician eligible
professionals who are solo practitioners that participate in the Pioneer
ACO Model or the Comprehensive Primary Care (CPC) Initiative during the
performance period for the payment adjustment period as described at
Sec. 414.1215.
(iii) For purposes of the value-based payment modifier, a group or
solo practitioner is considered to be participating in the Pioneer ACO
Model or CPC Initiative if at least one eligible professional billing
under the TIN in the performance period for the payment adjustment
period as described at Sec. 414.1215 is participating in the Pioneer
ACO Model or CPC Initiative in the performance period.
(4) Application of the value-based payment modifier to participants
in other similar Innovation Center models. (i) For the CY 2017 payment
adjustment period, the value-based payment modifier is waived under
section 1115A(d)(1) of the Act for physicians in groups with 2 or more
eligible professionals and for physicians who are solo practitioners
that participate in other similar Innovation Center models during the
performance period for the payment adjustment period as described at
Sec. 414.1215.
(ii) For the CY 2018 payment adjustment period, the value-based
payment modifier is waived under section 1115A(d)(1) of the Act for
physicians and nonphysician eligible professionals in groups with 2 or
more eligible professionals and for physicians and nonphysician eligible
professionals who are solo practitioners that participate in other
similar Innovation Center models during the performance period for the
payment adjustment period as described at Sec. 414.1215.
(iii) For purposes of the value-based payment modifier, a group or
solo practitioner is considered to be participating in a similar
Innovation Center model if at least one eligible professional billing
under the TIN in the performance period for the payment adjustment
period as described at Sec. 414.1215 is participating in the similar
model in the performance period.
(c) Group size and composition determination. (1) The list of groups
of physicians subject to the value-based payment modifier for the CY
2015 payment adjustment period is based on a query of PECOS on October
15, 2013. For each
[[Page 148]]
subsequent calendar year payment adjustment period, the list of groups
and solo practitioners subject to the value-based payment modifier is
based on a query of PECOS that occurs within 10 days of the close of the
Physician Quality Reporting System group registration process during the
applicable performance period described at Sec. 414.1215. Groups are
removed from the PECOS-generated list if, based on a claims analysis,
the group did not have the required number of eligible professionals, as
defined in paragraph (a) of this section, that submitted claims during
the performance period for the applicable calendar year payment
adjustment period. Solo practitioners are removed from the PECOS-
generated list if, based on a claims analysis, the solo practitioner did
not submit claims during the performance period for the applicable
calendar year payment adjustment period.
(2) Beginning with the CY 2016 payment adjustment period, the size
of a group during the applicable performance period will be determined
by the lower number of eligible professionals as indicated by the PECOS-
generated list or claims analysis.
(3) For the CY 2018 payment adjustment period, the composition of a
group during the applicable performance period will be determined based
on whether the group includes physicians, physician assistants, nurse
practitioners, clinical nurse specialists, certified registered nurse
anesthetists, and/or other types of nonphysician eligible professionals
as indicated by the PECOS-generated list or claims analysis.
[77 FR 69368, Nov. 16, 2012, as amended at 78 FR 74820, Dec. 10, 2013;
79 FR 68005, Nov. 13, 2014; 80 FR 71382, Nov. 16, 2015; 81 FR 80555,
Nov. 15, 2016]
Sec. 414.1215 Performance and payment adjustment periods
for the value-based payment modifier.
(a) The performance period is calendar year 2013 for value-based
payment modifier adjustments made in the calendar year 2015 payment
adjustment period.
(b) The performance period is calendar year 2014 for value-based
payment modifier adjustments made in the calendar year 2016 payment
adjustment period.
(c) The performance period is calendar year 2015 for value-based
payment modifier adjustments made in the calendar year 2017 payment
adjustment period.
(d) The performance period is calendar year 2016 for value-based
payment modifier adjustments made in the calendar year 2018 payment
adjustment period.
[77 FR 69368, Nov. 16, 2012, as amended at 78 FR 74820, Dec. 10, 2013;
80 FR 71383, Nov. 16, 2015]
Sec. 414.1220 Reporting mechanisms for the value-based payment modifier.
Solo practitioners and groups subject to the value-based payment
modifier (or individual eligible professionals within such groups) may
submit data on quality measures as specified under the Physician Quality
Reporting System using the reporting mechanisms for which they are
eligible.
[78 FR 74820, Dec. 10, 2013, as amended at 79 FR 68006, Nov. 13, 2014]
Sec. 414.1225 Alignment of Physician Quality Reporting System
quality measures and quality measures for the value-based payment modifier.
All of the quality measures for which solo practitioners and groups
(or individual eligible professionals within such groups) are eligible
to report under the Physician Quality Reporting System in a given
calendar year are used to calculate the value-based payment modifier for
the applicable payment adjustment period, as defined in Sec. 414.1215,
to the extent a solo practitioner or a group (or individual eligible
professionals within such group) submit data on such measures.
[79 FR 68006, Dec. 13, 2014]
Sec. 414.1230 Additional measures for groups and solo practitioners.
The value-based payment modifier includes the following additional
quality measures (outcome measures) as applicable for all groups and
solo practitioners subject to the value-based payment modifier:
(a) A composite of rates of potentially preventable hospital
admissions
[[Page 149]]
for heart failure, chronic obstructive pulmonary disease, and diabetes.
The rate of potentially preventable hospital admissions for diabetes is
a composite measure of uncontrolled diabetes, short term diabetes
complications, long term diabetes complications and lower extremity
amputation for diabetes.
(b) A composite of rates of potentially preventable hospital
admissions for dehydration, urinary tract infections, and bacterial
pneumonia.
(c) Rates of an all-cause hospital readmissions measure, except for
groups with between two to nine eligible professionals and solo
practitioners starting with the CY 2017 payment adjustment period.
[77 FR 69368, Nov. 16, 2012, as amended at 79 FR 68007, Nov. 13, 2014;
80 FR 71383, Nov. 16, 2015]
Sec. 414.1235 Cost measures.
(a) Included measures. Beginning with the CY 2016 payment adjustment
period, costs for groups and solo practitioners subject to the value-
based payment modifier are assessed based on a cost composite comprised
of the following 6 cost measures (only the measures identified in
paragraphs (a)(1) through (5) of this section are included for the
value-based payment modifier for the CY 2015 payment adjustment period):
(1) Total per capita costs for all attributed beneficiaries.
(2) Total per capita costs for all attributed beneficiaries with
diabetes.
(3) Total per capita costs for all attributed beneficiaries with
coronary artery disease.
(4) Total per capita costs for all attributed beneficiaries with
chronic obstructive pulmonary disease.
(5) Total per capita costs for all attributed beneficiaries with
heart failure.
(6) Medicare Spending per Beneficiary associated with an acute
inpatient hospitalization.
(b) Included payments. Cost measures enumerated in paragraph (a) of
this section include all fee-for-service payments made under Medicare
Part A and Part B.
(c) Cost measure adjustments. (1) Payments under Medicare Part A and
Part B will be adjusted using CMS' payment standardization methodology
to ensure fair comparisons across geographic areas.
(2) The CMS-HCC model (and adjustments for ESRD status) is used to
adjust standardized payments for the measures listed at paragraphs
(a)(1) through (5) of this section.
(3) The beneficiary's age and severity of illness are used to adjust
the Medicare Spending per Beneficiary measure as specified in paragraph
(a)(6) of this section.
(4) Beginning with the CY 2016 payment adjustment period, the cost
measures of a group and solo practitioner subject to the value-based
payment modifier are adjusted to account for the group's and solo
practitioner's specialty mix, by computing the weighted average of the
national specialty specific expected costs and comparing this to the
group's actual risk adjusted costs. Each national specialty-specific
expected cost is weighted by the proportion of Part B payments incurred
by each specialty within the group.
(5) The national specialty-specific expected costs referenced in
paragraph (c)(4) of this section are derived by calculating, for each
specialty, the weighted average of the risk-adjusted costs computed
across all groups, where the weight for each group is equal to the
number of beneficiaries attributed to the group, times the number of
eligible professionals in the group with the relevant specialty, times
the proportion of eligible professionals in the group with the relevant
specialty.
[78 FR 74821, Dec. 10, 2013, as amended at 79 FR 68007, Nov. 13, 2014;
80 FR 71383, Nov. 16, 2015]
Sec. 414.1240 Attribution for quality of care and cost measures.
(a) Beneficiaries are attributed to groups and solo practitioners
subject to the value-based payment modifier using a method generally
consistent with the method of assignment of beneficiaries under Sec.
425.402 of this chapter, for measures other than the Medicare Spending
per Beneficiary measure.
(b) For the Medicare Spending per Beneficiary (MSPB) measure, an
MSPB episode is attributed to the group or
[[Page 150]]
the solo practitioner subject to the value-based payment modifier whose
eligible professionals submitted the plurality of claims (as measured by
allowable charges) under the group's or solo practitioner's TIN for
Medicare Part B services, rendered during an inpatient hospitalization
that is an index admission for the MSPB measure during the applicable
performance period described at Sec. 414.1215.
[79 FR 68007, Nov. 13, 2014]
Sec. 414.1245 Scoring methods for the value-based payment modifier
using the quality-tiering approach.
For each quality of care and cost measure, a standardized score is
calculated for each group and solo practitioner subject to the value-
based payment modifier by dividing--
(a) The difference between their performance rate and the benchmark,
by
(b) The measure's standard deviation.
[77 FR 69368, Nov. 16, 2012, as amended at 79 FR 68007, Nov. 13, 2014]
Sec. 414.1250 Benchmarks for quality of care measures.
(a) The benchmark for quality of care measures reported through the
PQRS using the claims, registries, QCDR, or web interface is the
national mean for that measure's performance rate (regardless of the
reporting mechanism) during the year prior to the performance period. In
calculating the national benchmark, solo practitioners' and groups' (or
individual eligible professionals' within such groups) performance rates
are weighted by the number of beneficiaries used to calculate the solo
practitioners' or groups' (or individual eligible professionals' within
such groups) performance rate. Beginning with the CY 2016 performance
period, eCQMs reported via EHRs are excluded from the overall benchmark
for quality of care measures and separate eCQM benchmarks will be
developed. The eCQM benchmark is the national mean for the measure's
performance rate during the year prior to the performance period. In
calculating the national benchmark, solo practitioners' and groups' (or
individual eligible professionals' within such groups) performance rates
are weighted by the number of beneficiaries used to calculate the solo
practitioners' or groups' (or individual eligible professionals' within
such groups) performance rate.
(b) The benchmark for each outcome measure under Sec. 414.1230, is
the national mean for that measure's performance rate during the year
prior to the performance period. In calculating the national benchmark,
solo practitioners' and groups' (or individual eligible professionals'
within such groups) performance rates are weighted by the number of
beneficiaries used to calculate the solo practitioners' or groups' (or
individual eligible professionals' within such groups) performance rate.
[79 FR 68007, Nov. 13, 2014, as amended at 80 FR 71384, Nov. 16, 2015]
Sec. 414.1255 Benchmarks for cost measures.
(a) For the CY 2015 payment adjustment period, the benchmark for
each cost measure is the national mean of the performance rates
calculated among all groups of physicians for which beneficiaries are
attributed to the group of physicians that are subject to the value-
based payment modifier. In calculating the national benchmark, groups of
physicians' performance rates are weighted by the number of
beneficiaries used to calculate the group of physician's performance
rate.
(b) Beginning with the CY 2016 payment adjustment period, the
benchmark for each cost measure is the national mean of the performance
rates calculated among all groups and solo practitioners that meet the
minimum number of cases for that measure under Sec. 414.1265(a). In
calculating the national benchmark, groups and solo practitioners'
performance rates are weighted by the number of beneficiaries used to
calculate the group or solo practitioner's performance rate.
[78 FR 74821, Dec. 10, 2013, as amended at 79 FR 68007, Nov. 13, 2014;
80 FR 71384, Nov. 16, 2015]
Sec. 414.1260 Composite scores.
(a)(1) The standardized score for each quality of care measure is
classified into one of the following equally weighted domains to
determine the quality composite:
[[Page 151]]
(i) Patient safety.
(ii) Patient experience.
(iii) Care coordination.
(iv) Clinical care.
(v) Population/community health.
(vi) Efficiency.
(2) If a domain includes no measure or does not reach the minimum
case size in Sec. 414.1265, the remaining domains are equally weighted
to form the quality of care composite.
(b)(1) The standardized score for each cost measure is grouped into
two separate and equally weighted domains to determine the cost
composite:
(i) Total per capita costs for all attributed beneficiaries: Total
per capita costs measure and Medicare Spending per Beneficiary measure;
and
(ii) Total per capita costs for all attributed beneficiaries with
specific conditions: Diabetes, coronary artery disease, chronic
obstructive pulmonary disease, or heart failure (four measures).
(2) Measures within each domain are equally weighted.
[77 FR 69368, Nov. 16, 2012, as amended at 78 FR 74821, Dec. 10, 2013]
Sec. 414.1265 Reliability of measures.
To calculate a composite score for a quality measure or a cost
measure, a group or solo practitioner subject to the value-based payment
modifier must have 20 or more cases for that measure.
(a) In a performance period, if a group or solo practitioner has
fewer than 20 cases for a measure, that measure is excluded from its
domain and the remaining measures in the domain are given equal weight.
(1) Starting with the CY 2017 payment adjustment period, the
exception to this paragraph (a) is the all-cause hospital readmissions
measure described at Sec. 414.1230(c). In a performance period, if a
group has fewer than 200 cases for this all-cause hospital readmissions
measure, that measure is excluded from its domain and the remaining
measures in the domain are given equal weight.
(2) Starting with the CY 2017 payment adjustment period, the
Medicare Spending Per Beneficiary measure described at Sec.
414.1235(a)(6) is an exception to this paragraph (a). In a performance
period, if a group or a solo practitioner has fewer than 125 episodes
for this MSPB measure, that measure is excluded from its domain and the
remaining measures in the domain are given equal weight.
(b)(1) For the CY 2015 payment adjustment period, if a reliable
quality of care composite or cost composite cannot be calculated,
payments will not be adjusted under the value-based payment modifier.
(2) Beginning with the CY 2016 payment adjustment period, a group
and a solo practitioner subject to the value-based payment modifier will
receive a quality composite score that is classified as ``average''
under Sec. 414.1275(b)(1) if such group and solo practitioner do not
have at least one quality measure that meets the minimum number of cases
under paragraph (a) of this section.
(3) Beginning with the CY 2016 payment adjustment period, a group
and a solo practitioner subject to the value-based payment modifier will
receive a cost composite score that is classified as ``average'' under
Sec. 414.1275(b)(2) if such group and solo practitioner do not have at
least one cost measure that meets the minimum number of cases under
paragraph (a) of this section.
[77 FR 69368, Nov. 16, 2012, as amended at 79 FR 68007, Nov. 13, 2014;
80 FR 71384, Nov. 16, 2015]
Sec. 414.1270 Determination and calculation of Value-Based Payment
Modifier adjustments.
(a) For the CY 2015 payment adjustment period:
(1) Downward payment adjustments. A downward payment adjustment will
be applied to a group of physicians subject to the value-based payment
modifier if--
(i) Such group neither self-nominates for the PQRS GPRO and reports
at least one measure, nor elects the PQRS administrative claims option
for CY 2013 as defined in Sec. 414.90(h).
(A) Such adjustment will be -1.0 percent.
(B) [Reserved]
(ii) Such group elects that its value-based payment modifier be
calculated using a quality-tiering approach, and is determined to have
poor performance
[[Page 152]]
(low quality and high costs; low quality and average costs; or average
quality and high costs).
(A) Such adjustment will not exceed -1.0 percent as specified in
Sec. 414.1275(c)(1).
(B) [Reserved]
(2) No payment adjustments. There will be no value-based payment
modifier adjustment applied to a group of physicians subject to the
value-based payment modifier if such group either:
(i) Self-nominates for the PQRS GPRO and reports at least one
measure; or
(ii) Elects the PQRS administrative claims option for CY 2013 as
defined in Sec. 414.90(h).
(3) Upward payment adjustments. If a group of physicians subject to
the value-based payment modifier elects that the value-based payment
modifier be calculated using a quality-tiering approach, upward payment
adjustments are determined based on the projected aggregate amount of
downward payment adjustments determined under paragraph (a)(1) of this
section and applied as specified in Sec. 414.1275(c)(1).
(b) For the CY 2016 payment adjustment period:
(1) A downward payment adjustment of -2.0 percent will be applied to
a group of physicians subject to the value-based payment modifier if,
during the applicable performance period as defined in Sec. 414.1215,
the following apply:
(i) Such group does not self-nominate for the PQRS GPRO and meet the
criteria as a group to avoid the PQRS payment adjustment for CY 2016 as
specified by CMS; and
(ii) Fifty percent of the eligible professionals in such group do
not meet the criteria as individuals to avoid the PQRS payment
adjustment for CY 2016 as specified by CMS.
(2) For a group of physicians comprised of 100 or more eligible
professionals that is not included in paragraph (b)(1) of this section,
the value-based payment modifier adjustment will be equal to the amount
determined under Sec. 414.1275(c)(2).
(3) For a group of physicians comprised of between 10 and 99
eligible professionals that is not included in paragraph (b)(1) of this
section, the value-based payment modifier adjustment will be equal to
the amount determined under Sec. 414.1275(c)(2), except that such
adjustment will be 0.0 percent if the group of physicians is determined
to be low quality/high cost, low quality/average cost, or average
quality/high cost.
(4) If at least fifty percent of the eligible professionals in the
group meet the criteria as individuals to avoid the PQRS payment
adjustment for CY 2016 as specified by CMS, and all of those eligible
professionals use a qualified clinical data registry and CMS is unable
to receive quality performance data for them, the quality composite
score for such group will be classified as ``average'' under Sec.
414.1275(b)(1).
(c) For the CY 2017 payment adjustment period:
(1) A downward payment adjustment of -2.0 percent will be applied to
a group with two to nine eligible professionals and a solo practitioner
and a downward payment adjustment of -4.0 percent will be applied to a
group with 10 or more eligible professionals subject to the value-based
payment modifier if, during the applicable performance period as defined
in Sec. 414.1215, the following apply:
(i) Such group does not meet the criteria as a group to avoid the
PQRS payment adjustment for CY 2017 as specified by CMS; and
(ii) Fifty percent of the eligible professionals in such group do
not meet the criteria as individuals to avoid the PQRS payment
adjustment for CY 2017 as specified by CMS; or
(iii) Such solo practitioner does not meet the criteria as an
individual to avoid the PQRS payment adjustment for CY 2017 as specified
by CMS.
(2) For a group comprised of 10 or more eligible professionals that
is not included in paragraph (c)(1) of this section, the value-based
payment modifier adjustment will be equal to the amount determined under
Sec. 414.1275(c)(3)(i).
(3) For a group comprised of between two to nine eligible
professionals and a solo practitioner that are not included in paragraph
(c)(1) of this section, the value-based payment modifier adjustment will
be equal to the amount determined under Sec. 414.1275(c)(3)(ii).
[[Page 153]]
(4) If at least fifty percent of the eligible professionals in the
group meet the criteria as individuals to avoid the PQRS payment
adjustment for CY 2017 as specified by CMS, and all of those eligible
professionals use a qualified clinical data registry and CMS is unable
to receive quality performance data for them, the quality composite
score for such group will be classified as ``average'' under Sec.
414.1275(b)(1).
(d) For the CY 2018 payment adjustment period:
(1) A downward payment adjustment of -1.0 percent will be applied to
a solo practitioner, a group with two to nine eligible professionals,
and a group consisting only of nonphysician eligible professionals
subject to the value-based payment modifier and no physicians; and a
downward payment adjustment of -2.0 percent will be applied to a group
with 10 or more eligible professionals and at least one physician if,
during the applicable performance period as defined in Sec. 414.1215,
the following apply:
(i) For groups:
(A) Such group does not meet the criteria as a group to avoid the
PQRS payment adjustment for CY 2018 as specified by CMS; and
(B) Fifty percent of the eligible professionals in such group do not
meet the criteria as individuals to avoid the PQRS payment adjustment
for CY 2018 as specified by CMS.
(ii) For solo practitioners, such solo practitioner does not meet
the criteria as an individual to avoid the PQRS payment adjustment for
CY 2018 as specified by CMS.
(2) For a group composed of 10 or more eligible professionals that
is not included in paragraph (d)(1) of this section, the value-based
payment modifier adjustment will be equal to the amount determined under
Sec. 414.1275(c)(4)(i).
(3) For a group composed of between two to nine eligible
professionals and a solo practitioner that are not included in paragraph
(d)(1) of this section, the value-based payment modifier adjustment will
be equal to the amount determined under Sec. 414.1275(c)(4)(ii).
(4) For a group and a solo practitioner consisting of nonphysician
eligible professionals that are not included in paragraph (d)(1) of this
section, the value-based payment modifier adjustment will be equal to
the amount determined under Sec. 414.1275(c)(4)(iii).
(5) If at least 50 percent of the eligible professionals in the
group meet the criteria as individuals to avoid the PQRS payment
adjustment for CY 2018 as specified by CMS, and all of those eligible
professionals use a qualified clinical data registry and CMS is unable
to receive quality performance data for them, the quality composite
score for such group will be classified as ``average'' under Sec.
414.1275(b)(1).
[78 FR 74821, Dec. 10, 2013, as amended at 79 FR 68007, Nov. 13, 2014;
80 FR 71384, Nov. 16, 2015; 82 FR 53363, Nov. 15, 2017]
Sec. 414.1275 Value-based payment modifier quality-tiering
scoring methodology.
(a) The value-based payment modifier amount for a group and a solo
practitioner subject to the value-based payment modifier is based upon a
comparison of the composite of quality of care measures and a composite
of cost measures.
(b) Quality composite and cost composite are classified into high,
average, and low categories based on whether the composites are
statistically above, not different from, or below the mean composite
scores.
(1) Quality composites that are one or more standard deviations
above the mean are classified into the high category. Quality composites
that are one or more standard deviations below the mean are classified
into the low category.
(2) Cost composites that are one or more standard deviations below
the mean are classified into the low category. Cost composites that are
one or more standard deviations above the mean are classified into the
high category.
(c)(1) The following value-based payment modifier percentages apply
to the CY 2015 payment adjustment period:
[[Page 154]]
CY 2015 Value-Based Payment Modifier Amounts for the Quality-Tiering
Approach
------------------------------------------------------------------------
Average High cost
Quality/cost Low cost cost (percent)
------------------------------------------------------------------------
High quality..................... + 2.0x* + 1.0x* + 0.0
Average quality.................. + 1.0x* + 0.0% -0.5
Low quality...................... + 0.0% -0.5% -1.0
------------------------------------------------------------------------
* Groups of physicians eligible for an additional + 1.0x if (1)
reporting Physician Quality Reporting System quality measures through
the GPRO web-interface or CMS-qualified registry, and (2) average
beneficiary risk score is in the top 25 percent of all beneficiary
risk scores.
(2) The following value-based payment modifier percentages apply to
the CY 2016 payment adjustment period:
CY 2016 Value-Based Payment Modifier Amounts for the Quality-Tiering
Approach
------------------------------------------------------------------------
Average High cost
Quality/cost Low cost cost (percent)
------------------------------------------------------------------------
High quality..................... + 2.0x* + 1.0x* + 0.0
Average quality.................. + 1.0x* + 0.0% -1.0
Low quality...................... + 0.0% -1.0% -2.0
------------------------------------------------------------------------
* Groups of physicians eligible for an additional + 1.0x if reporting
Physician Quality Reporting System quality measures and average
beneficiary risk score is in the top 25 percent of all beneficiary
risk scores.
(3) The following value-based payment modifier percentages apply to
the CY 2017 payment adjustment period:
(i) For groups with 10 or more eligible professionals:
CY 2017 Value-Based Payment Modifier Amounts for the Quality-Tiering Approach for Groups With 10 or More
Eligible Professionals
----------------------------------------------------------------------------------------------------------------
Cost/quality Low quality Average quality High quality
----------------------------------------------------------------------------------------------------------------
Low Cost............................................... + 0.0% * + 2.0x * + 4.0x
Average Cost........................................... -2.0% + 0.0% * + 2.0x
High Cost.............................................. -4.0% -2.0% + 0.0%
----------------------------------------------------------------------------------------------------------------
* Groups eligible for an additional + 1.0x if reporting Physician Quality Reporting System quality measures and
average beneficiary risk score is in the top 25 percent of all beneficiary risk scores, where `x' represents
the upward payment adjustment factor.
(ii) For groups with two to nine eligible professionals and solo
practitioners:
CY 2017 Value-Based Payment Modifier Amounts for the Quality-Tiering Approach for Groups With Two to Nine
Eligible Professionals and Solo Practitioners
----------------------------------------------------------------------------------------------------------------
Cost/quality Low quality Average quality High quality
----------------------------------------------------------------------------------------------------------------
Low Cost............................................... + 0.0% * + 1.0x * + 2.0x
Average Cost........................................... + 0.0% + 0.0% * + 1.0x
High Cost.............................................. + 0.0% + 0.0% + 0.0%
----------------------------------------------------------------------------------------------------------------
* Groups and solo practitioners eligible for an additional + 1.0x if reporting Physician Quality Reporting
System quality measures and average beneficiary risk score is in the top 25 percent of all beneficiary risk
scores, where `x' represents the upward payment adjustment factor.
(4) The following value-based payment modifier percentages apply to
the CY 2018 payment adjustment period, for physicians, physician
assistants, nurse practitioners, clinical nurse specialists, and
certified registered nurse anesthetists who are solo practitioners or
who are in groups of any size:
CY 2018 Value-Based Payment Modifier Amounts for the Quality-Tiering Approach for Physicians, Physician
Assistants, Nurse Practitioners, Clinical Nurse Specialists, and Certified Registered Nurse Anesthetists
----------------------------------------------------------------------------------------------------------------
Average
Cost/quality Low quality quality High quality
----------------------------------------------------------------------------------------------------------------
Low Cost........................................................ +0.0% * +1.0x * +2.0x
[[Page 155]]
Average Cost.................................................... +0.0% +0.0% * +1.0x
High Cost....................................................... +0.0% +0.0% +0.0%
----------------------------------------------------------------------------------------------------------------
* Eligible for an additional +1.0x if reporting Physician Quality Reporting System quality measures and average
beneficiary risk score is in the top 25 percent of all beneficiary risk scores, where `x' represents the
upward payment adjustment factor.
(d)(1) Groups of physicians subject to the value-based payment
modifier that have an attributed beneficiary population with an average
risk score in the top 25 percent of the risk scores of beneficiaries
nationwide and for the CY 2015 payment adjustment period elect the
quality-tiering approach or for the CY 2016 payment adjustment period
are subject to the quality-tiering approach, receive a greater upward
payment adjustment as follows:
(i) Classified as high quality/low cost receive an upward adjustment
of + 3x (rather than + 2x); and
(ii) Classified as either high quality/average cost or average
quality/low cost receive an upward adjustment of + 2x (rather than +
1x).
(2) Groups and solo practitioners subject to the value-based payment
modifier that have an attributed beneficiary population with an average
risk score in the top 25 percent of the risk scores of beneficiaries
nationwide and for the CY 2017 payment adjustment period are subject to
the quality-tiering approach, receive a greater upward payment
adjustment as follows:
(i) Classified as high quality/low cost receive an upward adjustment
of + 5x (rather than + 4x) if the group has 10 or more eligible
professionals or + 3x (rather than + 2x) if a solo practitioner or the
group has two to nine eligible professionals; and
(ii) Classified as either high quality/average cost or average
quality/low cost receive an upward adjustment of + 3x (rather than + 2x)
if the group has 10 or more eligible professionals or + 2x (rather than
+ 1x) if a solo practitioner or the group has two to nine eligible
professionals.
(3) Groups and solo practitioners subject to the value-based payment
modifier that have an attributed beneficiary population with an average
risk score in the top 25 percent of the risk scores of beneficiaries
nationwide and for the CY 2018 payment adjustment period are subject to
the quality-tiering approach, receive a greater upward payment
adjustment as follows:
(i) Classified as high quality/low cost receive an upward adjustment
of +3x (rather than +2x); and
(ii) Classified as either high quality/average cost or average
quality/low cost receive an upward adjustment of +2x (rather than +1x).
[77 FR 69368, Nov. 16, 2012, as amended at 78 FR 74822, Dec. 10, 2013;
79 FR 68008, Nov. 13, 2014; 80 FR 71385, Nov. 16, 2015; 82 FR 53363,
Nov. 15, 2017]
Sec. 414.1280 Limitation on review.
(a) There shall be no administrative or judicial review under
section 1869 of the Act, section 1878 of the Act, or otherwise of all of
the following:
(1) The establishment of the value-based payment modifier.
(2) The evaluation of the quality of care composite, including the
establishment of appropriate measure of the quality of care.
(3) The evaluation of costs composite, including establishment of
appropriate measures of costs.
(4) The dates of implementation of the value-based payment modifier.
(5) The specification of the initial performance period and any
other performance period.
(6) The application of the value-based payment modifier.
(7) The determination of costs.
(b) [Reserved]
Sec. 414.1285 Informal inquiry process.
After the dissemination of the annual Physician Feedback reports, a
group and a solo practitioner may contact CMS to inquire about its
report and
[[Page 156]]
the calculation of the value-based payment modifier.
[77 FR 69368, Nov. 16, 2012, as amended at 79 FR 68008, Nov. 13, 2014]
Subpart O_Merit-Based Incentive Payment System and Alternative Payment
Model Incentive
Source: 81 FR 77537, Nov. 4, 2016, unless otherwise noted.
Sec. 414.1300 Basis and scope.
(a) Basis. This subpart implements the following provisions of the
Act:
(1) Section 1833(z)--Incentive Payments for Participation in
Eligible Alternative Payment Models.
(2) Section 1848(a)--Payment for Physicians' Services Based on Fee
Schedule.
(3) Section 1848(k)--Quality Reporting System.
(4) Section 1848(q)--Merit-based Incentive Payment System.
(b) Scope. This subpart part sets forth the following:
(1) The circumstances under which eligible clinicians are not
considered MIPS eligible clinicians with respect to a year.
(2) How individual MIPS eligible clinicians can have their
performance assessed as a group.
(3) The data submission methods and data submission criteria for
each of the MIPS performance categories.
(4) Methods for calculating a performance category score for each of
the MIPS performance categories.
(5) Methods for calculating a MIPS final score and applying the MIPS
payment adjustment to MIPS eligible clinicians.
(6) Requirements for an APM to be designated an ``Advanced APM.''
(7) Methods for eligible clinicians and entities participating in
Advanced APMs to meet the participation thresholds to become Qualifying
APM Participants (QPs) and Partial QPs.
(8) Methods and processes for counting participation in Other Payer
Advanced APMs in making QP and Partial QP determinations.
(9) Methods for calculating and paying the APM Incentive Payment to
QPs.
(10) Criteria for Physician-Focused Payment Models (PFPMs).
Sec. 414.1305 Definitions.
As used in this section, unless otherwise indicated--
Additional performance threshold means the numerical threshold for a
MIPS payment year against which the final scores of MIPS eligible
clinicians are compared to determine the additional MIPS payment
adjustment factors for exceptional performance.
Advanced Alternative Payment Model (Advanced APM) means an APM that
CMS determines meets the criteria set forth in Sec. 414.1415.
Affiliated practitioner means an eligible clinician identified by a
unique APM participant identifier on a CMS-maintained list who has a
contractual relationship with the APM Entity for the purposes of
supporting the APM Entity's quality or cost goals under the Advanced
APM.
Affiliated practitioner list means the list of Affiliated
Practitioners of an APM Entity that is compiled from a CMS-maintained
list.
Alternative Payment Model (APM) means any of the following:
(1) A model under section 1115A of the Act (other than a health care
innovation award).
(2) The shared savings program under section 1899 of the Act.
(3) A demonstration under section 1866C of the Act.
(4) A demonstration required by Federal law.
Ambulatory Surgical Center (ASC)-based MIPS eligible clinician
means:
(1) For the 2019 and 2020 MIPS payment years, a MIPS eligible
clinician who furnishes 75 percent or more of his or her covered
professional services in sites of service identified by the Place of
Service (POS) codes used in the HIPAA standard transaction as an
ambulatory surgical center setting based on claims for a period prior to
the performance period as specified by CMS; and
(2) Beginning with the 2021 MIPS payment year, a MIPS eligible
clinician who furnishes 75 percent or more
[[Page 157]]
of his or her covered professional services in sites of service
identified by the POS codes used in the HIPAA standard transaction as an
ambulatory surgical center setting based on claims for the MIPS
determination period.
APM Entity means an entity that participates in an APM or other
payer arrangement through a direct agreement with CMS or an other payer
or through Federal or State law or regulation.
APM Entity group means the group of eligible clinicians
participating in an APM Entity, as identified by a combination of the
APM identifier, APM Entity identifier, Taxpayer Identification Number
(TIN), and National Provider Identifier (NPI) for each participating
eligible clinician.
APM Incentive Payment means the lump sum incentive payment for a
year paid to an eligible clinician who is a QP for the year from 2019
through 2024.
Attestation means a secure mechanism, specified by CMS, with respect
to a particular performance period, whereby a MIPS eligible clinician or
group may submit the required data for the advancing care information or
the improvement activities performance categories of MIPS in a manner
specified by CMS.
Attributed beneficiary means a beneficiary attributed to the APM
Entity under the terms of the Advanced APM as indicated on the most
recent available list of attributed beneficiaries at the time of a QP
determination.
Attribution-eligible beneficiary means a beneficiary who during the
QP Performance Period:
(1) Is not enrolled in Medicare Advantage or a Medicare cost plan;
(2) Does not have Medicare as a secondary payer;
(3) Is enrolled in both Medicare Parts A and B;
(4) Is at least 18 years of age;
(5) Is a United States resident; and
(6) Has a minimum of one claim for evaluation and management
services furnished by an eligible clinician who is in the APM Entity for
any period during the QP Performance Period or, for an Advanced APM that
does not base attribution on evaluation and management services and for
which attributed beneficiaries are not a subset of the attribution-
eligible beneficiary population based on the requirement to have at
least one claim for evaluation and management services furnished by an
eligible clinician who is in the APM Entity for any period during the QP
Performance Period, the attribution basis determined by CMS based upon
the methodology the Advanced APM uses for attribution, which may include
a combination of evaluation and management and/or other services.
Certified Electronic Health Record Technology (CEHRT) means the
following:
(1) For any calendar year before 2019, EHR technology (which could
include multiple technologies) certified under the ONC Health IT
Certification Program that meets one of the following:
(i) The 2014 Edition Base EHR definition (as defined at 45 CFR
170.102) and that has been certified to the certification criteria that
are necessary to report on applicable objectives and measures specified
for the MIPS advancing care information performance category, including
the applicable measure calculation certification criterion at 45 CFR
170.314(g)(1) or (2) for all certification criteria that support an
objective with a percentage-based measure.
(ii) Certification to--
(A) The following certification criteria:
(1) CPOE at--
(i) 45 CFR 170.314(a)(1), (18), (19) or (20); or
(ii) 45 CFR 170.315(a)(1), (2) or (3).
(2)(i) Record demographics at 45 CFR 170.314(a)(3); or
(ii) 45 CFR 170.315(a)(5).
(3)(i) Problem list at 45 CFR 170.314(a)(5); or
(ii) 45 CFR 170.315(a)(6).
(4)(i) Medication list at 45 CFR 170.314(a)(6); or
(ii) 45 CFR 170.315(a)(7).
(5)(i) Medication allergy list 45 CFR 170.314(a)(7); or
(ii) 45 CFR 170.315(a)(8).
(6)(i) Clinical decision support at 45 CFR 170.314(a)(8); or
(ii) 45 CFR 170.315(a)(9).
(7) Health information exchange at transitions of care at one of the
following:
(i) 45 CFR 170.314(b)(1) and (2).
[[Page 158]]
(ii) 45 CFR 170.314(b)(1), (b)(2), and (h)(1).
(iii) 45 CFR 170.314(b)(1), (b)(2), and (b)(8).
(iv) 45 CFR 170.314(b)(1), (b)(2), (b)(8), and (h)(1).
(v) 45 CFR 170.314(b)(8) and (h)(1).
(vi) 45 CFR 170.314(b)(1), (b)(2), and 170.315(h)(2).
(vii) 45 CFR 170.314(b)(1), (b)(2), (h)(1), and 170.315(h)(2).
(viii) 45 CFR 170.314(b)(1), (b)(2), (b)(8), and 170.315(h)(2).
(ix) 45 CFR 170.314(b)(1), (b)(2), (b)(8), (h)(1), and
170.315(h)(2).
(x) 45 CFR 170.314(b)(8), (h)(1), and 170.315(h)(2).
(xi) 45 CFR 170.314(b)(1), (b)(2), and 170.315(b)(1).
(xii) 45 CFR 170.314(b)(1), (b)(2), (h)(1), and 170.315(b)(1).
(xiii) 45 CFR 170.314(b)(1), (b)(2), (b)(8), and 170.315(b)(1).
(xiv) 45 CFR 170.314(b)(1), (b)(2), (b)(8), (h)(1), and
170.315(b)(1).
(xv) 45 CFR 170.314(b)(8), (h)(1), and 170.315(b)(1).
(xvi) 45 CFR 170.314(b)(1), (b)(2), (b)(8), (h)(1), 170.315(b)(1),
and 170.315(h)(1).
(xvii) 45 CFR 170.314(b)(1), (b)(2), (b)(8), (h)(1), 170.315(b)(1),
and 170.315(h)(2).
(xviii) 45 CFR 170.314(h)(1) and 170.315(b)(1).
(xix) 45 CFR 170.315(b)(1) and (h)(1).
(xx) 45 CFR 170.315(b)(1) and (h)(2).
(xxi) 45 CFR 170.315(b)(1), (h)(1), and (h)(2); and
(B) Clinical quality measures at--
(1) 45 CFR 170.314(c)(1) or 170.315(c)(1);
(2) 45 CFR 170.314(c)(2) or 170.315(c)(2);
(3) Clinical quality measure certification criteria that support the
calculation and reporting of clinical quality measures at 45 CFR
170.314(c)(2) and (3) and optionally (4); or 45 CFR 170.315(c)(3)(i) and
(ii) and optionally (c)(4); and can be electronically accepted by CMS if
the data is submitted electronically.
(C) Privacy and security at--
(1) 45 CFR 170.314(d)(1) or 170.315(d)(1);
(2) 45 CFR 170.314(d)(2) or 170.315(d)(2);
(3) 45 CFR 170.314(d)(3) or 170.315(d)(3);
(4) 45 CFR 170.314(d)(4) or 170.315(d)(4);
(5) 45 CFR 170.314(d)(5) or 170.315(d)(5);
(6) 45 CFR 170.314(d)(6) or 170.315(d)(6);
(7) 45 CFR 170.314(d)(7) or 170.315(d)(7);
(8) 45 CFR 170.314(d)(8) or 170.315(d)(8); and
(D) The certification criteria that are necessary to report on
applicable objectives and measures specified for the MIPS advancing care
information performance category, including the applicable measure
calculation certification criterion at 45 CFR 170.314(g)(1) or (2) or 45
CFR 170.315(g)(1) or (2) for all certification criteria that support an
objective with a percentage-based measure.
(iii) The definition for 2019 and subsequent years specified in
paragraph (2) of this definition.
(2) For 2019 and subsequent years, EHR technology (which could
include multiple technologies) certified under the ONC Health IT
Certification Program that meets the 2015 Edition Base EHR definition
(as defined at 45 CFR 170.102) and has been certified to the 2015
Edition health IT certification criteria--
(i) At 45 CFR 170.315(a)(12) (family health history) and 45 CFR
170.315(e)(3) (patient health information capture); and
(ii) Necessary to report on applicable objectives and measures
specified for the MIPS advancing care information performance category
including the following:
(A) The applicable measure calculation certification criterion at 45
CFR 170.315(g)(1) or (2) for all certification criteria that support an
objective with a percentage-based measure.
(B) Clinical quality measure certification criteria that support the
calculation and reporting of clinical quality measures at 45 CFR
170.315(c)(2) and (c)(3)(i) and (ii) and optionally (c)(4), and can be
electronically accepted by CMS.
CMS-approved survey vendor means a survey vendor that is approved by
CMS for a particular performance period to administer the CAHPS for MIPS
survey and to transmit survey measures data to CMS.
CMS Multi-Payer Model means an Advanced APM that CMS determines, per
the terms of the Advanced APM, has at least one other payer arrangement
that is designed to align with the terms of that Advanced APM.
CMS Web Interface means a web product developed by CMS that is used
by groups that have elected to utilize the
[[Page 159]]
CMS Web Interface to submit data on the MIPS measures and activities.
Collection type means a set of quality measures with comparable
specifications and data completeness criteria, as applicable, including,
but not limited to: electronic clinical quality measures (eCQMs); MIPS
Clinical Quality Measures (MIPS CQMs), QCDR measures, Medicare Part B
claims measures, CMS Web Interface measures, the CAHPS for MIPS survey,
and administrative claims measures.
Covered professional services has the meaning given by section
1848(k)(3)(A) of the Act.
Eligible clinician means ``eligible professional'' as defined in
section 1848(k)(3) of the Act, as identified by a unique TIN and NPI
combination and, includes any of the following:
(1) A physician.
(2) A practitioner described in section 1842(b)(18)(C) of the Act.
(3) A physical or occupational therapist or a qualified speech-
language pathologist.
(4) A qualified audiologist (as defined in section 1861(ll)(3)(B) of
the Act).
Episode payment model means an APM or other payer arrangement
designed to improve the efficiency and quality of care for an episode of
care by bundling payment for services furnished to an individual over a
defined period of time for a specific clinical condition or conditions.
Estimated aggregate payment amounts means the total payments to a QP
for Medicare Part B covered professional services for the incentive
payment base period, estimated by CMS as described in Sec. 414.1450(b).
Facility-based MIPS eligible clinician means an individual MIPS
eligible clinician who furnishes 75 percent or more of their covered
professional services (as defined in section 1848(k)(3)(A) of the Act)
in sites of service identified by the Place of Service (POS) codes used
in the HIPAA standard transaction as an inpatient hospital, as
identified by POS code 21, or an emergency room, as identified by POS
code 23, based on claims during the facility-based determination period,
and a group provided that more than 75 percent of the NPIs billing under
the group's TIN meet the definition of a facility-based individual MIPS
eligible clinician during the facility-based determination period.
Final score means a composite assessment (using a scoring scale of 0
to 100) for each MIPS eligible clinician for a performance period
determined using the methodology for assessing the total performance of
a MIPS eligible clinician according to performance standards for
applicable measures and activities for each performance category.
Full TIN APM means an APM where participation is determined at the
TIN level, and all eligible clinicians who have assigned their billing
rights to a participating TIN are therefore participating in the APM.
Group means a single TIN with two or more eligible clinicians
(including at least one MIPS eligible clinician), as identified by their
individual NPI, who have reassigned their billing rights to the TIN.
Health IT vendor means an entity that supports the health IT
requirements on behalf of a MIPS eligible clinician (including obtaining
data from a MIPS eligible clinician's CEHRT).
Health Professional Shortage Areas (HPSA) means areas as designated
under section 332(a)(1)(A) of the Public Health Service Act.
High priority measure means:
(1) For the 2019 and 2020 MIPS payment years, an outcome (including
intermediate-outcome and patient-reported outcome), appropriate use,
patient safety, efficiency, patient experience, or care coordination
quality measure.
(2) Beginning with the 2021 MIPS payment year, an outcome (including
intermediate-outcome and patient-reported outcome), appropriate use,
patient safety, efficiency, patient experience, care coordination, or
opioid-related quality measure.
Hospital-based MIPS eligible clinician means:
(1) For the 2019 and 2020 MIPS payment years, a MIPS eligible
clinician who furnishes 75 percent or more of his or her covered
professional services in sites of service identified by the Place of
Service (POS) codes used in the HIPAA standard transaction as an
inpatient hospital, on-campus outpatient
[[Page 160]]
hospital, off campus-outpatient hospital, or emergency room setting
based on claims for a period prior to the performance period as
specified by CMS; and
(2) Beginning with the 2021 MIPS payment year, a MIPS eligible
clinician who furnishes 75 percent or more of his or her covered
professional services in sites of service identified by the POS codes
used in the HIPAA standard transaction as an inpatient hospital, on-
campus outpatient hospital, off campus outpatient hospital, or emergency
room setting based on claims for the MIPS determination period.
Improvement activities means an activity that relevant MIPS eligible
clinician, organizations and other relevant stakeholders identify as
improving clinical practice or care delivery and that the Secretary
determines, when effectively executed, is likely to result in improved
outcomes.
Improvement scoring means an assessment measuring improvement for
each MIPS eligible clinician or group for a performance period using a
methodology that compares improvement from one performance period to
another performance period.
Incentive payment base period means the calendar year prior to the
year in which CMS disburses the APM Incentive Payment.
Low-volume threshold means:
(1) For the 2019 MIPS payment year, the low-volume threshold that
applies to an individual eligible clinician, group, or APM Entity group
that, during the low-volume threshold determination period described in
paragraph (4) of this definition, has Medicare Part B allowed charges
less than or equal to $30,000 or provides care for 100 or fewer Medicare
Part B-enrolled individuals.
(2) For the 2020 MIPS payment year, the low-volume threshold that
applies to an individual eligible clinician, group, or APM Entity group
that, during the low-volume threshold determination period described in
paragraph (4) of this definition, has allowed charges for covered
professional services less than or equal to $90,000 or furnishes covered
professional services to 200 or fewer Medicare Part B-enrolled
individuals.
(3) Beginning with the 2021 MIPS payment year, the low-volume
threshold that applies to an individual eligible clinician, group, or
APM Entity group that, during the MIPS determination period, has allowed
charges for covered professional services less than or equal to $90,000,
furnishes covered professional services to 200 or fewer Medicare Part B-
enrolled individuals, or furnishes 200 or fewer covered professional
services to Medicare Part B-enrolled individuals.
(4) For the 2019 and 2020 MIPS payment years, the low-volume
threshold determination period is a 24-month assessment period
consisting of:
(i) An initial 12-month segment that spans from the last 4 months of
the calendar year 2 years prior to the performance period through the
first 8 months of the calendar year preceding to the performance period;
and
(ii) A second 12-month segment that spans from the last 4 months of
the calendar year 1 year prior to the performance period through the
first 8 months of the calendar year performance period. An individual
eligible clinician, group, or APM Entity group that is identified as not
exceeding the low-volume threshold during the initial 12-month segment
will continue to be excluded under Sec. 414.1310(b)(1)(iii) for the
applicable year regardless of the results of the second 12-month segment
analysis. For the 2019 MIPS payment year, each segment of the low-volume
threshold determination period includes a 60-day claims run out. For the
2020 MIPS payment year, each segment of the low-volume threshold
determination period includes a 30-day claims run out.
Meaningful EHR user for MIPS means a MIPS eligible clinician who
possesses CEHRT, uses the functionality of CEHRT, and reports on
applicable objectives and measures specified for the advancing care
information performance category for a performance period in the form
and manner specified by CMS, supports information exchange and the
prevention of health information blocking, and engages in activities
related to supporting providers with the performance of CEHRT.
[[Page 161]]
Measure benchmark means the level of performance that the MIPS
eligible clinician is assessed on for a specific performance period at
the measures and activities level.
Medicaid APM means a payment arrangement authorized by a State
Medicaid program that meets the Other Payer Advanced APM criteria set
forth in Sec. 414.1420.
Medical Home Model means an APM under section 1115A of the Act that
is determined by CMS to have the following characteristics:
(1) The APM has a primary care focus with participants that
primarily include primary care practices or multispecialty practices
that include primary care physicians and practitioners and offer primary
care services. For the purposes of this provision, primary care focus
means the inclusion of specific design elements related to eligible
clinicians practicing under one or more of the following Physician
Specialty Codes: 01 General Practice; 08 Family Medicine; 11 Internal
Medicine; 16 Obstetrics and Gynecology; 37 Pediatric Medicine; 38
Geriatric Medicine; 50 Nurse Practitioner; 89 Clinical Nurse Specialist;
and 97 Physician Assistant;
(2) Empanelment of each patient to a primary clinician; and
(3) At least four of the following:
(i) Planned coordination of chronic and preventive care.
(ii) Patient access and continuity of care.
(iii) Risk-stratified care management.
(iv) Coordination of care across the medical neighborhood.
(v) Patient and caregiver engagement.
(vi) Shared decision-making.
(vii) Payment arrangements in addition to, or substituting for, fee-
for-service payments (for example, shared savings or population-based
payments).
Medicaid Medical Home Model means a payment arrangement under title
XIX that CMS determines to have the following characteristics:
(1) The payment arrangement has a primary care focus with
participants that primarily include primary care practices or
multispecialty practices that include primary care physicians and
practitioners and offer primary care services. For the purposes of this
provision, primary care focus means the inclusion of specific design
elements related to eligible clinicians practicing under one or more of
the following Physician Specialty Codes: 01 General Practice; 08 Family
Medicine; 11 Internal Medicine; 16 Obstetrics and Gynecology; 37
Pediatric Medicine; 38 Geriatric Medicine; 50 Nurse Practitioner; 89
Clinical Nurse Specialist; and 97 Physician Assistant;
(2) Empanelment of each patient to a primary clinician; and
(3) At least four of the following:
(i) Planned coordination of chronic and preventive care.
(ii) Patient access and continuity.
(iii) Risk-stratified care management.
(iv) Coordination of care across the medical neighborhood.
(v) Patient and caregiver engagement.
(vi) Shared decision-making.
(vii) Payment arrangements in addition to, or substituting for, fee-
for-service payments (for example, shared savings or population-based
payments).
Merit-based Incentive Payment System (MIPS) means the program
required by section 1848(q) of the Act.
MIPS APM means an APM that meets the criteria specified under Sec.
414.1370(b).
MIPS determination period means:
(1) Beginning with the 2021 MIPS payment year, a 24-month assessment
period consisting of:
(i) An initial 12-month segment beginning on October 1 of the
calendar year 2 years prior to the applicable performance period and
ending on September 30 of the calendar year preceding the applicable
performance period, and that includes a 30-day claims run out; and
(ii) A second 12-month segment beginning on October 1 of the
calendar year preceding the applicable performance period and ending on
September 30 of the calendar year in which the applicable performance
period occurs.
(2) Subject to Sec. 414.1310(b)(1)(iii), an individual eligible
clinician, group, or APM Entity group that is identified as not
exceeding the low-volume threshold or as having special status during
the first segment of the MIPS determination period will be identified as
[[Page 162]]
such for the applicable MIPS payment year regardless of the results of
the second segment of the MIPS determination period. An individual
eligible clinician, group, or APM Entity group for which the unique
billing TIN and NPI combination is established during the second segment
of the MIPS determination period will be assessed based solely on the
results of such segment.
MIPS eligible clinician as identified by a unique billing TIN and
NPI combination used to assess performance, means any of the following
(except as excluded under Sec. 414.1310(b)):
(1) For the 2019 and 2020 MIPS payment years:
(i) A physician (as defined in section 1861(r) of the Act);
(ii) A physician assistant, a nurse practitioner, and clinical nurse
specialist (as such terms are defined in section 1861(aa)(5) of the
Act);
(iii) A certified registered nurse anesthetist (as defined in
section 1861(bb)(2) of the Act); and
(iv) A group that includes such clinicians.
(2) For the 2021 MIPS payment year and future years:
(i) A clinician described in paragraph (1) of this definition;
(ii) A physical therapist or occupational therapist;
(iii) A qualified speech-language pathologist;
(iv) A qualified audiologist (as defined in section 1861(ll)(3)(B)
of the Act);
(v) A clinical psychologist (as defined by the Secretary for
purposes of section 1861(ii) of the Act);
(vi) A registered dietician or nutrition professional; and
(vii) A group that includes such clinicians.
MIPS payment year means a calendar year in which the MIPS payment
adjustment factor, and if applicable the additional MIPS payment
adjustment factor, are applied to Medicare Part B payments.
New Medicare-Enrolled MIPS eligible clinician means an eligible
clinician who first becomes a Medicare-enrolled eligible clinician
within the Provider Enrollment, Chain and Ownership System (PECOS)
during the performance period for a year and had not previously
submitted claims under Medicare as an individual, an entity, or a part
of a physician group or under a different billing number or tax
identifier.
Non-patient facing MIPS eligible clinician means:
(1) For the 2019 and 2020 MIPS payment year, an individual MIPS
eligible clinician who bills 100 or fewer patient facing encounters
(including Medicare telehealth services defined in section 1834(m) of
the Act), as described in paragraph (3) of this definition, during the
non-patient facing determination period described in paragraph (4) of
this definition, and a group or virtual group provided that more than 75
percent of the NPIs billing under the group's TIN or virtual group's
TINs, as applicable, meet the definition of a non-patient facing
individual MIPS eligible clinician.
(2) Beginning with the 2021 MIPS payment year, an individual MIPS
eligible clinician who bills 100 or fewer patient facing encounters
(including Medicare telehealth services defined in section 1834(m) of
the Act), as described in paragraph (3) of this definition, during the
MIPS determination period, and a group or virtual group provided that
more than 75 percent of the NPIs billing under the group's TIN or
virtual group's TINs, as applicable, meet the definition of a non-
patient facing individual MIPS eligible clinician.
(3) For purposes of this definition, a patient-facing encounter is
an instance in which the individual MIPS eligible clinician or group
bills for items and services furnished such as general office visits,
outpatient visits, and procedure codes under the PFS, as specified by
CMS.
(4) For the 2019 and 2020 MIPS payment year, the non-patient facing
determination period is a 24-month assessment period consisting of:
(i) An initial 12-month segment that spans from the last 4 months of
the calendar year 2 years prior to the performance period through the
first 8 months of the calendar year preceding the performance period;
and
(ii) A second 12-month segment that spans from the last 4 months of
the calendar year 1 year prior to the performance period through the
first 8 months
[[Page 163]]
of the calendar year performance period. An individual eligible MIPS
clinician, group, or virtual group that is identified as non-patient
facing during the initial 12-month segment will continue to be
considered non-patient facing for the applicable year regardless of the
results of the second 12-month segment analysis. For the 2019 MIPS
payment year, each segment of the non-patient facing determination
period includes a 60-day claims run out. For the 2020 MIPS payment year
and future years, each segment of the non-patient facing determination
period includes a 30-day claims run out.
Other MIPS APM means a MIPS APM that does not require reporting
through the CMS Web Interface.
Other Payer Advanced APM means an other payer arrangement that meets
the Other Payer Advanced APM criteria set forth in Sec. 414.1420.
Other payer arrangement means a payment arrangement with any payer
that is not an APM.
Partial Qualifying APM Participant (Partial QP) means an eligible
clinician determined by CMS to have met the relevant Partial QP
threshold under Sec. 414.1430(a)(2) and (4) and (b)(2) and (4) for a
year.
Partial QP patient count threshold means the minimum threshold score
specified in Sec. 414.1430(a)(4) and (b)(4) that an eligible clinician
must attain through a patient count methodology described in Sec. Sec.
414.1435(b) and 414.1440(c) to become a Partial QP for a year.
Partial QP payment amount threshold means the minimum threshold
score specified in Sec. 414.1430(a)(2) and (b)(2) that an eligible
clinician must attain through a payment amount methodology described
Sec. Sec. 414.1435(a) and 414.1440(b) to become a Partial QP for a
year.
Participation List means the list of participants in an APM Entity
that is compiled from a CMS-maintained list.
Performance category score means the assessment of each MIPS
eligible clinician's performance on the applicable measures and
activities for a performance category for a performance period based on
the performance standards for those measures and activities.
Performance standards means the level of performance and methodology
that the MIPS eligible clinician is assessed on for a MIPS performance
period at the measures and activities level for all MIPS performance
categories.
Performance threshold means the numerical threshold for a MIPS
payment year against which the final scores of MIPS eligible clinicians
are compared to determine the MIPS payment adjustment factors.
QP patient count threshold means the minimum threshold score
specified in Sec. 414.1430(a)(3) and (b)(3) that an eligible clinician
must attain through a patient count methodology described in Sec. Sec.
414.1435(b) and 414.1440(c) to become a QP for a year.
QP payment amount threshold means the minimum threshold score
specified in Sec. 414.1430(a)(1) and (b)(1) that an eligible clinician
must attain through the payment amount methodology described in
Sec. Sec. 414.1435(a) and 414.1440(b) to become a QP for a year.
QP Performance Period means the time period that CMS will use to
assess the level of participation by an eligible clinician in Advanced
APMs and Other Payer Advanced APMs for purposes of making a QP
determination for the eligible clinician for the year as specified in
Sec. 414.1425. The QP Performance Period begins on January 1 and ends
on August 31 of the calendar year that is 2 years prior to the payment
year.
Qualified clinical data registry (QCDR) means:
(1) For the 2019, 2020 and 2021 MIPS payment year, a CMS-approved
entity that has self-nominated and successfully completed a
qualification process to determine whether the entity may collect
medical or clinical data for the purpose of patient and disease tracking
to foster improvement in the quality of care provided to patients.
(2) Beginning with the 2022 MIPS payment year, an entity that
demonstrates clinical expertise in medicine and quality measurement
development experience and collects medical or clinical data on behalf
of a MIPS eligible clinician for the purpose of patient and disease
tracking to foster improvement in the quality of care provided to
patients.
Qualified registry means a medical registry, a maintenance of
certification program operated by a specialty
[[Page 164]]
body of the American Board of Medical Specialties or other data
intermediary that, with respect to a particular performance period, has
self-nominated and successfully completed a vetting process (as
specified by CMS) to demonstrate its compliance with the MIPS
qualification requirements specified by CMS for that performance period.
The registry must have the requisite legal authority to submit MIPS data
(as specified by CMS) on behalf of a MIPS eligible clinician or group to
CMS.
Qualifying APM participant (QP) means an eligible clinician
determined by CMS to have met or exceeded the relevant QP payment amount
or QP patient count threshold under Sec. 414.1430(a)(1), (a)(3),
(b)(1), or (b)(3) for a year based on participation in an APM Entity
that is also participating in an Advanced APM.
Rural area means a ZIP code designated as rural, using the most
recent Health Resources and Services Administration (HRSA) Area Health
Resource File data set available.
Small practice means:
(1) For the 2019 MIPS payment year, a TIN consisting of 15 or fewer
eligible clinicians.
(2) For the 2020 MIPS payment year, a TIN consisting of 15 or fewer
eligible clinicians during a 12-month assessment period that spans from
the last 4 months of the calendar year 2 years prior to the performance
period through the first 8 months of the calendar year preceding the
performance period and includes a 30-day claims run out.
(3) Beginning with the 2021 MIPS payment year, a TIN consisting of
15 or fewer eligible clinicians during the MIPS determination period.
Solo practitioner means a practice consisting of 1 eligible
clinician (who is also a MIPS eligible clinician).
Submission type means the mechanism by which the submitter type
submits data to CMS, including, but not limited to: Direct, log in and
upload, log in and attest, Medicare Part B claims and the CMS Web
Interface.
Submitter type means the MIPS eligible clinician, group, virtual
group, or third party intermediary acting on behalf of a MIPS eligible
clinician, group, or virtual group, as applicable, that submits data on
measures and activities under MIPS.
Third party intermediary means an entity that has been approved
under Sec. 414.1400 to submit data on behalf of a MIPS eligible
clinician, group, or virtual group for one or more of the quality,
improvement activities, and promoting interoperability performance
categories.
Threshold Score means the percentage value that CMS determines for
an eligible clinician based on the calculations described in Sec.
414.1435 or Sec. 414.1440.
Topped out non-process measure means a measure where the Truncated
Coefficient of Variation is less than 0.10 and the 75th and 90th
percentiles are within 2 standard errors.
Topped out process measure means a measure with a median performance
rate of 95 percent or higher.
Virtual group means a combination of two or more TINs assigned to
one or more solo practitioners or to one or more groups consisting of 10
or fewer eligible clinicians, or both, that elect to form a virtual
group for a performance period for a year.
[81 FR 77537, Nov. 4, 2016, as amended at 82 FR 53950, Nov. 16, 2017; 83
FR 60075, Nov. 23, 2018]
Sec. 414.1310 Applicability.
(a) Program implementation. Except as specified in paragraph (b) of
this section, MIPS applies to payments for covered professional services
furnished by MIPS eligible clinicians on or after January 1, 2019.
(b) Exclusions. (1) For a year, a MIPS eligible clinician does not
include an eligible clinician who:
(i) Is a Qualifying APM Participant (as defined at Sec. 414.1305);
(ii) Is a Partial Qualifying APM Participant and does not elect to
participate in MIPS as a MIPS eligible clinician; or
(iii) Does not exceed the low-volume threshold. Beginning with the
2021 MIPS payment year, if an individual eligible clinician, group, or
APM Entity group in a MIPS APM exceeds at least one, but not all, of the
low-volume threshold criteria and elects to participate in MIPS as a
MIPS eligible clinician, the individual eligible clinician, group, or
APM Entity group is
[[Page 165]]
treated as a MIPS eligible clinician for the applicable MIPS payment
year. For such solo practitioners and groups that elect to participate
in MIPS as a virtual group (except for APM Entity groups in MIPS APMs),
the virtual group election under Sec. 414.1315 constitutes an election
under this paragraph and results in the solo practitioners and groups
being treated as MIPS eligible clinicians for the applicable MIPS
payment year. For such APM Entity groups in MIPS APMs, only the APM
Entity group election can result in the APM Entity group being treated
as MIPS eligible clinicians for the applicable MIPS payment year.
(2) Eligible clinicians, as defined at Sec. 414.1305, who are not
MIPS eligible clinicians, as defined at Sec. 414.1305, have the option
to voluntarily report measures and activities for MIPS.
(c) Treatment of new Medicare-enrolled eligible clinicians. New
Medicare-enrolled eligible clinician, as defined at Sec. 414.1305, will
not be treated as a MIPS eligible clinician until the subsequent year
and the performance period for such subsequent year.
(d) Clarification. In no case will a MIPS payment adjustment factor
(or additional MIPS payment adjustment factor) apply to payments for
items and services furnished during a year by a eligible clinician,
including an eligible clinician described in paragraph (b) or (c) of
this section, who is not a MIPS eligible clinician, including an
eligible clinician who voluntarily reports on applicable measures and
activities under MIPS.
(e) Requirements for groups. (1) Except as provided under Sec.
414.1370(f)(2), each MIPS eligible clinician in the group will receive a
MIPS payment adjustment factor (or additional MIPS payment adjustment
factor) based on the group's combined performance assessment.
(2) For individual MIPS eligible clinicians to participate in MIPS
as a group, all of the following requirements must be met:
(i) Groups must meet the definition of a group at all times during
the applicable performance period.
(ii) Individual eligible clinicians that elect to participate in
MIPS as a group must aggregate their performance data across the group's
TIN.
(iii) Individual eligible clinicians that elect to participate in
MIPS as a group will have their performance assessed at the group level
across all four MIPS performance categories.
(iv) Groups must adhere to an election process established by CMS,
as applicable.
(3) Eligible clinicians and MIPS eligible clinicians within a group
must aggregate their performance data across the TIN in order for their
performance to be assessed as a group.
(4) A group that elects to have its performance assessed as a group
will be assessed as a group across all four MIPS performance categories.
(5) A group must adhere to an election process established and
required by CMS.
[81 FR 77537, Nov. 4, 2016, as amended at 83 FR 60076, Nov. 23, 2018]
Sec. 414.1315 Virtual groups.
(a) Eligibility. (1) For a MIPS payment year, a solo practitioner or
a group of 10 or fewer eligible clinicians may elect to participate in
MIPS as a virtual group with at least one other such solo practitioner
or group. The election must be made prior to the start of the applicable
performance period and cannot be changed during the performance period.
A solo practitioner or group may elect to be in no more than one virtual
group for a performance period, and, in the case of a group, the
election applies to all MIPS eligible clinicians in the group.
(2) Except as provided under Sec. 414.1370(f)(2), each MIPS
eligible clinician in the virtual group receives a MIPS payment
adjustment factor and, if applicable, an additional MIPS payment
adjustment factor based on the virtual group's combined performance
assessment.
(b) Election deadline. The election deadline is December 31 of the
calendar year preceding the applicable performance period.
(c) Election process. For the 2020 MIPS payment year and future
years, the virtual group election process is as follows:
[[Page 166]]
(1) Stage 1: Virtual group eligibility determination. (i) For the
2020 MIPS payment year, the virtual group eligibility determination
period is an assessment period of up to 5 months beginning on July 1 and
ending as late as November 30 of the calendar year preceding the
applicable performance period, and that includes a 30-day claims run
out.
(ii) Beginning with the 2021 MIPS payment year, the virtual group
eligibility determination period is the first segment of the MIPS
determination period.
(2) Stage 2: Virtual group formation. (i) Solo practitioners and
groups that elect to participate in MIPS as a virtual group must
establish a formal written agreement that satisfies paragraph (c)(3) of
this section prior to the election.
(ii) A designated virtual group representative must submit an
election, on behalf of the solo practitioners and groups that compose a
virtual group, to participate in MIPS as a virtual group for a
performance period in a form and manner specified by CMS by the election
deadline specified in paragraph (b) of this section. The virtual group
election must include each TIN and NPI associated with the virtual group
and contact information for the virtual group representative.
(iii) After an election is made, the virtual group representative
must contact their designated CMS contact to update any election
information that changed during a performance period at least one time
prior to the start of data submission.
(3) Virtual group agreement. The virtual group arrangement must be
set forth in a formal written agreement among the parties, consisting of
each solo practitioner and group that composes a virtual group. The
agreement must comply with the following requirements:
(i) Identifies each party by name, TIN, and each NPI under the TIN,
and includes as parties only the solo practitioners and groups that
compose the virtual group.
(ii) Is for a term of at least one performance period.
(iii) Requires each party to notify each NPI under the party's TIN
regarding their participation in the MIPS as a virtual group.
(iv) Sets forth each NPI's rights and obligations in, and
representation by, the virtual group, including, but not limited to, the
reporting requirements and how participation in the MIPS as a virtual
group affects the NPI's ability to participate in the MIPS outside of
the virtual group.
(v) Describes how the opportunity to receive payment adjustments
will encourage each member of the virtual group (and each NPI under each
TIN in the virtual group) to adhere to quality assurance and
improvement.
(vi) Requires each party to update its Medicare enrollment
information, including the addition or removal of NPIs billing under its
TIN, on a timely basis in accordance with Medicare program requirements
and to notify the other parties of any such changes within 30 days of
the change.
(vii) Requires completion of a close-out process upon termination or
expiration of the agreement that requires each party to furnish all data
necessary for the parties to aggregate their data across the virtual
group's TINs.
(viii) Expressly requires each party to participate in the MIPS as a
virtual group and comply with the requirements of the MIPS and all other
applicable laws (including, but not limited to, Federal criminal law,
the Federal False Claims Act, the Federal anti-kickback statute, the
Federal civil monetary penalties law, the Federal physician self-
referral law, and the Health Insurance Portability and Accountability
Act of 1996).
(ix) Is executed on behalf of each party by an individual who is
authorized to bind the party.
(d) Virtual group reporting requirements. For solo practitioners and
groups of 10 or fewer eligible clinicians to participate in MIPS as a
virtual group, all of the following requirements must be met:
(1) Virtual groups must meet the definition of a virtual group at
all times during the applicable performance period.
(2) Solo practitioners and groups of 10 or fewer eligible clinicians
that elect to participate in MIPS as a virtual
[[Page 167]]
group must aggregate their performance data across the virtual group's
TINs.
(3) Solo practitioners and groups of 10 or fewer eligible clinicians
that elect to participate in MIPS as a virtual group will have their
performance assessed at the virtual group level across all four MIPS
performance categories.
(4) Virtual groups must adhere to the election process described in
paragraph (c) of this section.
[83 FR 60077, Nov. 23, 2018]
Sec. 414.1320 MIPS performance period.
(a) For purposes of the 2019 MIPS payment year, the performance
period for all performance categories and submission mechanisms except
for the cost performance category and data for the quality performance
category reported through the CMS Web Interface, for the CAHPS for MIPS
survey, and for the all-cause hospital readmission measure, is a minimum
of a continuous 90-day period within CY 2017, up to and including the
full CY 2017 (January 1, 2017 through December 31, 2017). For purposes
of the 2019 MIPS payment year, for data reported through the CMS Web
Interface or the CAHPS for MIPS survey and administrative claims-based
cost and quality measures, the performance period under MIPS is CY 2017
(January 1, 2017 through December 31, 2017).
(b) For purposes of the 2020 MIPS payment year, the performance
period for:
(1) The quality and cost performance categories is CY 2018 (January
1, 2018 through December 31, 2018).
(2) Promoting Interoperability and improvement activities
performance categories is a minimum of a continuous 90-day period within
CY 2018, up to and including the full CY 2018 (January 1, 2018 through
December 31, 2018).
(c) For purposes of the 2021 MIPS payment year, the performance
period for:
(1) The quality and cost performance categories is CY 2019 (January
1, 2019 through December 31, 2019).
(2) Promoting Interoperability and improvement activities
performance categories is a minimum of a continuous 90-day period within
CY 2019, up to and including the full CY 2019 (January 1, 2019 through
December 31, 2019).
(d) Beginning with the 2022 MIPS payment year, the performance
period for:
(1) The quality and cost performance categories is the full calendar
year (January 1 through December 31) that occurs 2 years prior to the
applicable MIPS payment year.
(2) The improvement activities performance categories is a minimum
of a continuous 90-day period within the calendar year that occurs 2
years prior to the applicable MIPS payment year, up to and including the
full calendar year.
(e) For purposes of the 2022 MIPS payment year, the performance
period for:
(1) The Promoting Interoperability performance category is a minimum
of a continuous 90-day period within the calendar year that occurs 2
years prior to the applicable MIPS payment year, up to and including the
full calendar year.
(2) [Reserved]
[81 FR 77537, Nov. 4, 2016, as amended at 82 FR 53953, Nov. 16, 2017; 83
FR 60078, Nov. 23, 2018]
Sec. 414.1325 Data submission requirements.
(a) Applicable performance categories. (1) Except as provided in
paragraph (a)(2) of this section or under Sec. 414.1370, as applicable,
individual MIPS eligible clinicians and groups must submit data on
measures and activities for the quality, improvement activities, and
Promoting Interoperability performance categories in accordance with
this section. Except for the Medicare Part B claims submission type, the
data may also be submitted on behalf of the individual MIPS eligible
clinician or group by a third party intermediary described at Sec.
414.1400.
(2) There are no data submission requirements for:
(i) The cost performance category or administrative claims-based
quality measures. Performance in the cost performance category and on
such measures is calculated by CMS using administrative claims data,
which includes claims submitted with dates of service
[[Page 168]]
during the applicable performance period that are processed no later
than 60 days following the close of the applicable performance period.
(ii) The quality and cost performance categories, as applicable, for
MIPS eligible clinicians and groups that are scored under the facility-
based measurement scoring methodology described in Sec. 414.1380(e).
(b) Data submission types for individual MIPS eligible clinicians.
An individual MIPS eligible clinician may submit their MIPS data using:
(1) For the quality performance category, the direct, login and
upload, and Medicare Part B claims (beginning with the 2021 MIPS payment
year for small practices only) submission types.
(2) For the improvement activities or Promoting Interoperability
performance categories, the direct, login and upload, or login and
attest submission types.
(c) Data submission types for groups. Groups may submit their MIPS
data using:
(1) For the quality performance category, the direct, login and
upload, Medicare Part B claims (beginning with the 2021 MIPS payment
year, for small practices only), and CMS Web Interface (for groups
consisting of 25 or more eligible clinicians or a third party
intermediary submitting on behalf of a group) submission types.
(2) For the improvement activities or Promoting Interoperability
performance categories, the direct, login and upload, or login and
attest submission types.
(d) Use of multiple data submission types. Beginning with the 2021
MIPS payment year, MIPS eligible clinicians, groups, and virtual groups
may submit their MIPS data using multiple data submission types for any
performance category described in paragraph (a)(1) of this section, as
applicable; provided, however, that the MIPS eligible clinician, group,
or virtual group uses the same identifier for all performance categories
and all data submissions.
(e) Data submission deadlines. The data submission deadlines are as
follows:
(1) For the direct, login and upload, login and attest, and CMS Web
Interface submission types, March 31 following the close of the
applicable performance period or a later date as specified by CMS.
(2) For the Medicare Part B claims submission type, data must be
submitted on claims with dates of service during the applicable
performance period that must be processed no later than 60 days
following the close of the applicable performance period.
[83 FR 60078, Nov. 23, 2018]
Sec. 414.1330 Quality performance category.
(a) For a MIPS payment year, CMS uses the following quality
measures, as applicable, to assess performance in the quality
performance category:
(1) Measures included in the MIPS final list of quality measures
established by CMS through rulemaking;
(2) QCDR measures approved by CMS under Sec. 414.1400;
(3) Facility-based measures described in Sec. 414.1380; and
(4) MIPS APM measures described in Sec. 414.1370.
(b) Unless a different scoring weight is assigned by CMS,
performance in the quality performance category comprises:
(1) 60 percent of a MIPS eligible clinician's final score for MIPS
payment year 2019.
(2) 50 percent of a MIPS eligible clinician's final score for MIPS
payment year 2020.
(3) 45 percent of a MIPS eligible clinician's final score for MIPS
payment year 2021.
[83 FR 60078, Nov. 23, 2018]
Sec. 414.1335 Data submission criteria for the quality performance category.
(a) Criteria. A MIPS eligible clinician or group must submit data on
MIPS quality measures in one of the following manners, as applicable:
(1) For Medicare Part B claims measures, MIPS CQMs, eCQMs, or QCDR
measures. (i) Except as provided in paragraph (a)(1)(ii) of this
section, submit data on at least six measures, including at least one
outcome measure. If an applicable outcome measure is not available,
report one other high priority measure. If fewer than six measures apply
to the MIPS eligible
[[Page 169]]
clinician or group, report on each measure that is applicable.
(ii) MIPS eligible clinicians and groups that report on a specialty
or subspecialty measure set, as designated in the MIPS final list of
quality measures established by CMS through rulemaking, must submit data
on at least six measures within that set, including at least one outcome
measure. If an applicable outcome measure is not available, report one
other high priority measure. If the set contains fewer than six measures
or if fewer than six measures within the set apply to the MIPS eligible
clinician or group, report on each measure that is applicable.
(2) For CMS Web Interface measures. (i) Report on all measures
included in the CMS Web Interface. The group is required to report on at
least one measure for which there is Medicare patient data.
(ii) [Reserved]
(3) For the CAHPS for MIPS survey. (i) For the 12-month performance
period, a group that wishes to voluntarily elect to participate in the
CAHPS for MIPS survey must use a survey vendor that is approved by CMS
for the applicable performance period to transmit survey measures data
to CMS.
(ii) [Reserved]
(b) [Reserved]
[81 FR 77537, Nov. 4, 2016, as amended at 82 FR 53953, Nov. 16, 2017; 83
FR 60079, Nov. 23, 2018]
Sec. 414.1340 Data completeness criteria for the quality
performance category.
(a) MIPS eligible clinicians and groups submitting quality measures
data on QCDR measures, MIPS CQMs, or eCQMs must submit data on:
(1) At least 50 percent of the MIPS eligible clinician or group's
patients that meet the measure's denominator criteria, regardless of
payer for the MIPS payment years 2019.
(2) At least 60 percent of the MIPS eligible clinician or group's
patients that meet the measure's denominator criteria, regardless of
payer for the MIPS payment years 2020 and 2021.
(b) MIPS eligible clinicians and groups submitting quality measure
data on Medicare Part B claims measures must submit data on:
(1) At least 50 percent of the applicable Medicare Part B patients
seen during the performance period to which the measure applies for MIPS
payment years 2019.
(2) At least 60 percent of the applicable Medicare Part B patients
seen during the performance period to which the measure applies for MIPS
payment years 2020 and 2021.
(c) Groups submitting quality measures data on CMS Web Interface
measures or the CAHPS for MIPS survey must submit data on the sample of
the Medicare Part B patients CMS provides, as applicable.
(1) For CMS Web Interface measures. (i) The group must report on the
first 248 consecutively ranked beneficiaries in the sample for each
measure or module. If the sample of eligible assigned beneficiaries is
less than 248, then the group must report on 100 percent of assigned
beneficiaries.
(ii) [Reserved]
(2) [Reserved]
[81 FR 77537, Nov. 4, 2016, as amended at 82 FR 53953, Nov. 16, 2017; 83
FR 60079, Nov. 23, 2018]
Sec. 414.1350 Cost performance category.
(a) Specification of cost measures. For purposes of assessing
performance of MIPS eligible clinicians on the cost performance
category, CMS specifies cost measures for a performance period.
(b) Attribution. (1) Cost measures are attributed at the TIN/NPI
level.
(2) For the total per capita cost measure, beneficiaries are
attributed using a method generally consistent with the method of
assignment of beneficiaries under Sec. 425.402 of this chapter.
(3) For the Medicare Spending per Beneficiary (MSPB) measure, an
episode is attributed to the MIPS eligible clinician who submitted the
plurality of claims (as measured by allowed charges) for Medicare Part B
services rendered during an inpatient hospitalization that is an index
admission for the MSPB measure during the applicable performance period.
(4) For the acute condition episode-based measures specified for the
2017
[[Page 170]]
performance period, an episode is attributed to each MIPS eligible
clinician who bills at least 30 percent of inpatient evaluation and
management (E&M) visits during the trigger event for the episode.
(5) For the procedural episode-based measures specified for the 2017
performance period, an episode is attributed to each MIPS eligible
clinician who bills a Medicare Part B claim with a trigger code during
the trigger event for the episode.
(6) For the acute inpatient medical condition episode-based measures
specified beginning with the 2019 performance period, an episode is
attributed to each MIPS eligible clinician who bills inpatient E&M claim
lines during a trigger inpatient hospitalization under a TIN that
renders at least 30 percent of the inpatient E&M claim lines in that
hospitalization.
(7) For the procedural episode-based measures specified beginning
with the 2019 performance period, an episode is attributed to each MIPS
eligible clinician who renders a trigger service as identified by HCPCS/
CPT procedure codes.
(c) Case minimums. (1) For the total per capita cost measure, the
case minimum is 20.
(2) For the Medicare spending per beneficiary measure, the case
minimum is 35.
(3) For the episode-based measures specified for the 2017
performance period, the case minimum is 20.
(4) For the procedural episode-based measures specified beginning
with the 2019 performance period, the case minimum is 10.
(5) For the acute inpatient medical condition episode-based measures
specified beginning with the 2019 performance period, the case minimum
is 20.
(d) Scoring weight. Unless a different scoring weight is assigned by
CMS under section 1848(q)(5)(F) of the Act, performance in the cost
performance category comprises:
(1) Zero percent of a MIPS eligible clinician's final score for MIPS
payment year 2019.
(2) 10 percent of a MIPS eligible clinician's final score for MIPS
payment year 2020.
(3) 15 percent of a MIPS eligible clinician's final score for MIPS
payment year 2021.
[83 FR 60079, Nov. 23, 2018]]
Sec. 414.1355 Improvement activities performance category.
(a) For a MIPS payment year, CMS uses improvement activities
included in the MIPS final inventory of improvement activities
established by CMS through rulemaking to assess performance in the
improvement activities performance category.
(b) Unless a different scoring weight is assigned by CMS under
section 1848(q)(5)(F) of the Act, performance in the improvement
activities performance category comprises:
(1) 15 percent of a MIPS eligible clinician's final score for MIPS
payment year 2019 and for each MIPS payment year thereafter.
(2) [Reserved].
(c) The following are the list of subcategories, of which, with the
exception of Participation in an APM, include activities for selection
by a MIPS eligible clinician or group:
(1) Expanded practice access, such as same day appointments for
urgent needs and after-hours access to clinician advice.
(2) Population management, such as monitoring health conditions of
individuals to provide timely health care interventions or participation
in a QCDR.
(3) Care coordination, such as timely communication of test results,
timely exchange of clinical information to patients or other clinicians,
and use of remote monitoring or telehealth.
(4) Beneficiary engagement, such as the establishment of care plans
for individuals with complex care needs, beneficiary self-management
assessment and training, and using shared decision making mechanisms.
(5) Patient safety and practice assessment, such as through the use
of clinical or surgical checklists and practice assessments related to
maintaining certification.
(6) Participation in an APM.
(7) Achieving health equity, such as for MIPS eligible clinicians
that achieve high quality for underserved
[[Page 171]]
populations, including persons with behavioral health conditions, racial
and ethnic minorities, sexual and gender minorities, people with
disabilities, people living in rural areas, and people in geographic
HPSAs.
(8) Emergency preparedness and response, such as measuring MIPS
eligible clinician participation in the Medical Reserve Corps, measuring
registration in the Emergency System for Advance Registration of
Volunteer Health Professionals, measuring relevant reserve and active
duty uniformed services MIPS eligible clinician activities, and
measuring MIPS eligible clinician volunteer participation in domestic or
international humanitarian medical relief work.
(9) Integrated behavioral and mental health, such as measuring or
evaluating such practices as: Co-location of behavioral health and
primary care services; shared/integrated behavioral health and primary
care records; cross training of MIPS eligible clinicians, and
integrating behavioral health with primary care to address substance use
disorders or other behavioral health conditions, as well as integrating
mental health with primary care.
[81 FR 77537, Nov. 4, 2016, as amended at 83 FR 60079, Nov. 23, 2018]
Sec. 414.1360 Data submission criteria for the improvement activities
performance category.
(a) For purposes of the transition year of MIPS and future years,
MIPS eligible clinicians or groups must submit data on MIPS improvement
activities in one of the following manners:
(1) Via direct, login and upload, and login and attest. For the
applicable performance period, submit a yes response for each
improvement activity that is performed for at least a continuous 90-day
period during the applicable performance period.
(i) Submit a yes response for activities within the improvement
activities inventory.
(ii) [Reserved]
(2) [Reserved]
(b) [Reserved]
[81 FR 77537, Nov. 4, 2016, as amended at 82 FR 53953, Nov. 16, 2017; 83
FR 60080, Nov. 23, 2018]
Sec. 414.1370 APM scoring standard under MIPS.
(a) General. The APM scoring standard is the MIPS scoring
methodology applicable for MIPS eligible clinicians identified on the
Participation List for the performance period of an APM Entity
participating in a MIPS APM.
(b) Criteria for MIPS APMs. MIPS APMs are those in which:
(1) APM Entities participate in the APM under an agreement with CMS
or through a law or regulation;
(2) The APM is designed such that APM Entities participating in the
APM include at least one MIPS eligible clinician on a Participation
List;
(3) The APM bases payment on quality measures and cost/utilization;
and
(4) The APM is not either of the following:
(i) New APMs. An APM for which the first performance year begins
after the first day of the MIPS performance period for the year.
(ii) APM in final year of operation for which the APM scoring
standard is impracticable. An APM in the final year of operation for
which CMS determines, within 60 days after the beginning of the MIPS
performance period for the year, that it is impracticable for APM Entity
groups to report to MIPS using the APM scoring standard.
(c) APM scoring standard performance period. The MIPS performance
period under Sec. 414.1320 applies for the APM scoring standard.
(d) APM participant identifier. The APM participant identifier for
an eligible clinician is the combination of four identifiers:
(1) APM identifier (established for the APM by CMS);
(2) APM Entity identifier (established for the APM Entity by CMS);
(3) Medicare-enrolled billing TIN; and
(4) Eligible clinician NPI.
(e) APM Entity group determination. For the APM scoring standard,
the APM Entity group is determined in the manner prescribed in Sec.
414.1425(b)(1).
(1) Full TIN APM. In addition to the dates set forth in Sec.
414.1425(b)(1), the APM Entity group includes an eligible clinician who
is on a Participation List in a Full TIN APM on December 31 of the MIPS
performance period.
(2) [Reserved]
[[Page 172]]
(f) APM Entity group scoring under the APM scoring standard. The
MIPS final score calculated for the APM Entity is applied to each MIPS
eligible clinician in the APM Entity group. The MIPS payment adjustment
is applied at the TIN/NPI level for each of the MIPS eligible clinicians
in the APM Entity group.
(1) If a Shared Savings Program ACO does not report data on quality
measures as required by the Shared Savings Program under Sec. 425.508
of this chapter, each ACO participant TIN will be treated as a unique
APM Entity for purposes of the APM scoring standard and the ACO
participant TINs may report data for the MIPS quality performance
category according to the MIPS submission and reporting requirements.
(2) MIPS eligible clinicians who participate in a group or have
elected to participate in a virtual group and who are also on a MIPS APM
Participation List will be included in the assessment under MIPS for
purposes of producing a group or virtual group score and under the APM
scoring standard for purposes of producing an APM Entity score. The MIPS
payment adjustment for these eligible clinicians is based solely on
their APM Entity score; if the APM Entity group is exempt from MIPS all
eligible clinicians within that APM Entity group are also exempt from
MIPS.
(g) MIPS performance category scoring under the APM scoring
standard--(1) Quality--(i) MIPS APMs that require APM Entities to submit
quality data using the CMS Web Interface. (A) Quality Performance
Category Score. The quality performance category score for a MIPS
performance period is calculated for the APM Entity using the data
submitted by the APM Entity according to the terms of the MIPS APM,
including data on measures submitted through the CMS Web Interface and
other measures specified by CMS through notice and comment rulemaking
for the APM scoring standard.
(B) Quality Improvement Score. Beginning in 2018, for an APM Entity
for which CMS calculated a total quality performance category score for
one or more participants in the APM Entity for the previous MIPS
performance period, CMS calculates a quality improvement score for the
APM Entity group as specified in Sec. 414.1380(b)(1)(xvi).
(C) Total Quality Performance Category Score. Beginning in 2018, the
total quality performance category score is the sum of the quality
performance category score, all applicable bonus points provided for by
Sec. 414.1380(b), and the quality improvement score.
(ii) Other MIPS APMs--(A) Quality Performance Category Score. The
MIPS quality performance category score for a MIPS performance period is
calculated for the APM Entity using the data submitted by the APM Entity
based on measures specified by CMS through notice and comment rulemaking
for each Other MIPS APM from among those used under the terms of the
Other MIPS APM, and which are:
(1) Tied to payment;
(2) Available for scoring;
(3) Have a minimum of 20 cases available for reporting; and
(4) Have an available benchmark.
(B) Quality Improvement Score. Beginning in 2018, for an APM Entity
for which CMS calculated a total quality performance category score for
the previous MIPS performance period, CMS calculates a quality
improvement score for the APM Entity group, as specified in Sec.
414.1380(b)(1)(xvi).
(C) Total Quality Performance Category Score. Beginning in 2018, the
total quality performance category score is the sum of the quality
performance category score, all applicable bonus points provided by
Sec. 414.1380(b), and the quality improvement score.
(2) Cost. The cost performance category weight is zero percent for
APM Entities in MIPS APMs.
(3) Improvement activities. (i) CMS assigns an improvement
activities score for each MIPS APM for a MIPS performance period based
on the requirements of the MIPS APM. The assigned improvement activities
score applies to each APM Entity group for the MIPS performance period.
In the event that the assigned score does not represent the maximum
improvement activities score, an APM Entity may report additional
activities.
(ii) [Reserved]
[[Page 173]]
(4) Promoting Interoperability. (i) For the 2019 and 2020 MIPS
payment years, each Shared Savings Program ACO participant TIN must
report data on the Promoting Interoperability performance category
separately from the ACO, as specified in Sec. 414.1375(b)(2). The ACO
participant TIN scores are weighted according to the number of MIPS
eligible clinicians in each TIN as a proportion of the total number of
MIPS eligible clinicians in the APM Entity group, and then aggregated to
determine an APM Entity score for the ACI performance category.
(ii) For the 2019 and 2020 MIPS payment years, for APM Entities in
MIPS APMs other than the Shared Savings Program, CMS uses one score for
each MIPS eligible clinician in the APM Entity group to derive a single
average APM Entity score for the Promoting Interoperability performance
category. Beginning with the 2021 MIPS payment year, for APM Entities in
MIPS APMs including the Shared Savings Program, CMS uses one score for
each MIPS eligible clinician in the APM Entity group to derive a single
average APM Entity score for the Promoting Interoperability performance
category. The score for each MIPS eligible clinician is the higher of
either:
(A) A group score based on the measure data for the Promoting
Interoperability performance category reported by a TIN for the MIPS
eligible clinician according to MIPS submission and reporting
requirements for groups; or
(B) An individual score based on the measure data for the Promoting
Interoperability performance category reported by the MIPS eligible
clinician according to MIPS submission and reporting requirements for
individuals.
(iii) In the event that a MIPS eligible clinician participating in a
MIPS APM receives an exception from the Promoting Interoperability
performance category reporting requirements, such eligible clinician
will be assigned a null score when CMS calculates the APM Entity's
Promoting Interoperability performance category score under the APM
scoring standard.
(A) If all MIPS eligible clinicians in an APM Entity have been
excepted from reporting the Promoting Interoperability performance
category, the performance category weight will be reweighted to zero for
the APM Entity for that MIPS performance period.
(B) [Reserved]
(h) APM scoring standard performance category weights. The
performance category weights used to calculate the MIPS final score for
an APM Entity group for the APM scoring standard performance period are:
(1) Quality. (i) For MIPS APMs that require use of the CMS Web
Interface: 50 percent.
(ii) For Other MIPS APMs, 0 percent for 2017, 50 percent beginning
in 2018.
(2) Cost. 0 percent.
(3) Improvement activities. (i) For MIPS APMs that require use of
the CMS Web Interface: 20 percent.
(ii) For Other MIPS APMs, 25 percent for 2017, 20 percent beginning
in 2018.
(4) Promoting Interoperability. (i) For MIPS APMs that require use
of the CMS Web Interface: 30 percent.
(ii) For Other MIPS APMs, 25 percent for 2017, 30 percent beginning
in 2018.
(5) Reweighting the MIPS Performance categories for the APM scoring
standard. If CMS determines there are not sufficient measures or
activities applicable and available to MIPS eligible clinicians, CMS
will assign weights as follows:
(i) If CMS reweights the quality performance category to 0 percent:
(A) In 2017, the improvement activities performance category is
reweighted to 25 percent and the Promoting Interoperability performance
category is reweighted to 75 percent; and
(B) Beginning in 2018, the Promoting Interoperability performance
category is reweighted to 75 percent and the improvement activities
performance category is reweighted to 25 percent.
(ii) If CMS reweights the Promoting Interoperability performance
category to zero percent:
(A) In 2017, the quality performance category is reweighted to 75
percent and the improvement activities performance category will remain
at 25 percent.
(B) Beginning in 2018, the quality performance category is
reweighted to 80 percent and the improvement activities performance
category will remain at 20 percent.
[[Page 174]]
(i) Total APM Entity Score. CMS scores each performance category and
then multiplies each performance category score by the applicable
performance category weight. CMS then calculates the sum of each
weighted performance category score and then applies all applicable
adjustments. APM Entities will receive MIPS bonuses applied to the final
score as set forth in Sec. 414.1380(b).
[81 FR 77537, Nov. 4, 2016, as amended at 82 FR 53953, Nov. 16, 2017; 83
FR 23610, May 22, 2018; 83 FR 60080, Nov. 23, 2018]
Sec. 414.1375 Promoting Interoperability (PI) performance category.
(a) Final score. Unless a different scoring weight is assigned by
CMS under sections 1848(o)(2)(D), 1848(q)(5)(E)(ii), or 1848(q)(5)(F) of
the Act, performance in the Promoting Interoperability performance
category comprises 25 percent of a MIPS eligible clinician's final score
for each MIPS payment year.
(b) Reporting for the Promoting Interoperability performance
category. To earn a performance category score for the Promoting
Interoperability performance category for inclusion in the final score,
a MIPS eligible clinician must:
(1) CEHRT. Use CEHRT as defined at Sec. 414.1305 for the
performance period;
(2) Report MIPS--Promoting Interoperability objectives and measures.
Report on the objectives and associated measures as specified by CMS for
the Promoting Interoperability performance category for the performance
period as follows:
(i) For the 2019 and 2020 MIPS payment years: For each base score
measure, as applicable, report the numerator (of at least one) and
denominator, or yes/no statement, or claim an exclusion for each measure
that includes an option for an exclusion; and
(ii) For the 2021 and 2022 MIPS payment years:
(A) Report that the MIPS eligible clinician completed the actions
included in the Security Risk Analysis measure during the year in which
the performance period occurs; and
(B) For each required measure, as applicable, report the numerator
(of at least one) and denominator, or yes/no statement, or an exclusion
for each measure that includes an option for an exclusion.
(3) Support information exchange and the prevention of health
information blocking, and engage in activities related to supporting
providers with the performance of CEHRT. (i) Supporting providers with
the performance of CEHRT (SPPC). To engage in activities related to
supporting providers with the performance of CEHRT, the MIPS eligible
clinician--
(A) Must attest that he or she:
(1) Acknowledges the requirement to cooperate in good faith with ONC
direct review of his or her health information technology certified
under the ONC Health IT Certification Program if a request to assist in
ONC direct review is received; and
(2) If requested, cooperated in good faith with ONC direct review of
his or her health information technology certified under the ONC Health
IT Certification Program as authorized by 45 CFR part 170, subpart E, to
the extent that such technology meets (or can be used to meet) the
definition of CEHRT, including by permitting timely access to such
technology and demonstrating its capabilities as implemented and used by
the MIPS eligible clinician in the field.
(B) Optionally, may also attest that he or she:
(1) Acknowledges the option to cooperate in good faith with ONC-ACB
surveillance of his or her health information technology certified under
the ONC Health IT Certification Program if a request to assist in ONC-
ACB surveillance is received; and
(2) If requested, cooperated in good faith with ONC-ACB surveillance
of his or her health information technology certified under the ONC
Health IT Certification Program as authorized by 45 CFR part 170,
subpart E, to the extent that such technology meets (or can be used to
meet) the definition of CEHRT, including by permitting timely access to
such technology and demonstrating its capabilities as implemented and
used by the MIPS eligible clinician in the field.
(ii) Support for health information exchange and the prevention of
information blocking. The MIPS eligible clinician must attest to CMS
that he or she--
[[Page 175]]
(A) Did not knowingly and willfully take action (such as to disable
functionality) to limit or restrict the compatibility or
interoperability of certified EHR technology.
(B) Implemented technologies, standards, policies, practices, and
agreements reasonably calculated to ensure, to the greatest extent
practicable and permitted by law, that the certified EHR technology was,
at all relevant times--
(1) Connected in accordance with applicable law;
(2) Compliant with all standards applicable to the exchange of
information, including the standards, implementation specifications, and
certification criteria adopted at 45 CFR part 170;
(3) Implemented in a manner that allowed for timely access by
patients to their electronic health information; and
(4) Implemented in a manner that allowed for the timely, secure, and
trusted bi-directional exchange of structured electronic health
information with other health care providers (as defined by 42 U.S.C.
300jj(3)), including unaffiliated providers, and with disparate
certified EHR technology and health IT vendors.
(C) Responded in good faith and in a timely manner to requests to
retrieve or exchange electronic health information, including from
patients, health care providers (as defined by 42 U.S.C. 300jj(3)), and
other persons, regardless of the requestor's affiliation or technology
vendor.
[81 FR 77537, Nov. 4, 2016, as amended at 82 FR 53955, Nov. 16, 2017; 83
FR 60080, Nov. 23, 2018]
Sec. 414.1380 Scoring.
(a) General. MIPS eligible clinicians are scored under MIPS based on
their performance on measures and activities in four performance
categories. MIPS eligible clinicians are scored against performance
standards for each performance category and receive a final score,
composed of their performance category scores, and calculated according
to the final score methodology.
(1) Performance standards. (i) For the quality performance category,
measures are scored between zero and 10 measure achievement points.
Performance is measured against benchmarks. Measure bonus points are
available for submitting high-priority measures, submitting measures
using end-to-end electronic reporting, and in small practices that
submit data on at least 1 quality measure. Beginning with the 2020 MIPS
payment year, improvement scoring is available in the quality
performance category.
(ii) For the cost performance category, measures are scored between
1 and 10 points. Performance is measured against a benchmark. Starting
with the 2024 MIPS payment year, improvement scoring is available in the
cost performance category.
(iii) For the improvement activities performance category, each
improvement activity is assigned a certain number of points. The points
for all submitted activities are summed and scored against a total
potential performance category score of 40 points.
(iv) For the Promoting Interoperability performance category, each
measure is scored against a maximum number of points. The points for all
submitted measures are summed and scored against a total potential
performance category score of 100 points.
(2) [Reserved]
(b) Performance categories. MIPS eligible clinicians are scored
under MIPS in four performance categories.
(1) Quality performance category. (i) Measure achievement points.
For the 2019, 2020, and 2021 MIPS payment years, MIPS eligible
clinicians receive between 3 and 10 measure achievement points
(including partial points) for each measure required under Sec.
414.1335 on which data is submitted in accordance with Sec. 414.1325
that has a benchmark at paragraph (b)(1)(ii) of this section, meets the
case minimum requirement at paragraph (b)(1)(iii) of this section, and
meets the data completeness requirement at Sec. 414.1340. The number of
measure achievement points received for each such measure is determined
based on the applicable benchmark decile category and the percentile
distribution. MIPS eligible clinicians receive zero measure achievement
points for each measure required
[[Page 176]]
under Sec. 414.1335 on which no data is submitted in accordance with
Sec. 414.1325. MIPS eligible clinicians that submit data in accordance
with Sec. 414.1325 on a greater number of measures than required under
Sec. 414.1335 are scored only on the required measures with the
greatest number of measure achievement points. Beginning with the 2021
MIPS payment year, MIPS eligible clinicians that submit data in
accordance with Sec. 414.1325 on a single measure via multiple
collection types are scored only on the data submission with the
greatest number of measure achievement points.
(A) Lack of benchmark or case minimum. (1) Except as provided in
paragraph (b)(1)(i)(A)(2) of this section, for the 2019, 2020, and 2021
MIPS payment years, MIPS eligible clinicians receive 3 measure
achievement points for each submitted measure that meets the data
completeness requirement, but does not have a benchmark or meet the case
minimum requirement.
(2) The following measures are excluded from a MIPS eligible
clinician's total measure achievement points and total available measure
achievement points:
(i) Each submitted CMS Web Interface-based measure that meets the
data completeness requirement, but does not have a benchmark or meet the
case minimum requirement, or is redesignated as pay-for-reporting for
all Shared Savings Program accountable care organizations by the Shared
Savings Program; and
(ii) Each administrative claims-based measure that does not have a
benchmark or meet the case minimum requirement.
(B) Lack of complete data. (1) Except as provided in paragraph
(b)(1)(i)(B)(2) of this section, for each submitted measure that does
not meet the data completeness requirement:
(i) For the 2019 MIPS payment year, MIPS eligible clinicians receive
3 measure achievement points;
(ii) For the 2020 and 2021 MIPS payment years, MIPS eligible
clinicians other than small practices receive 1 measure achievement
point, and small practices receive 3 measure achievement points; and
(iii) Beginning with the 2022 MIPS payment year, MIPS eligible
clinicians other than small practices receive zero measure achievement
points, and small practices receive 3 measure achievement points.
(2) MIPS eligible clinicians receive zero measure achievement points
for each submitted CMS Web Interface-based measure that does not meet
the data completeness requirement.
(ii) Benchmarks. Benchmarks will be based on collection type, from
all available sources, including MIPS eligible clinicians and APMs, to
the extent feasible, during the applicable baseline or performance
period.
(A) Each benchmark must have a minimum of 20 individual clinicians
or groups who reported the measure meeting the case minimum requirement
at paragraph (b)(1)(iii) of this section and the data completeness
requirement at Sec. 414.1340 and having a performance rate that is
greater than zero.
(B) CMS Web Interface collection type uses benchmarks from the
corresponding reporting year of the Shared Savings Program.
(iii) Minimum case requirements. Except for the all-cause hospital
readmission measure, the minimum case requirement is 20 cases. For the
all-cause hospital readmission measure, the minimum case requirement is
200 cases.
(iv) Topped out measures. CMS will identify topped out measures in
the benchmarks published for each Quality Payment Program year.
(A) For the 2020 MIPS payment year, each topped out measure
specified by CMS through rulemaking receives no more than 7 measure
achievement points, provided that the benchmark for the applicable
collection type is identified as topped out in the benchmarks published
for the 2018 MIPS performance period.
(B) Beginning with the 2021 MIPS payment year, each measure (except
for measures in the CMS Web Interface) for which the benchmark for the
applicable collection type is identified as topped out for 2 or more
consecutive years receives no more than 7 measure achievement points in
the second consecutive year it is identified as topped out, and beyond.
[[Page 177]]
(v) Measure bonus points. MIPS eligible clinicians receive measure
bonus points for the following measures, except as otherwise required
under Sec. 414.1335, regardless of whether the measure is included in
the MIPS eligible clinician's total measure achievement points.
(A) High priority measures. Subject to paragraph (b)(1)(v)(A)(1) of
this section, MIPS eligible clinicians receive 2 measure bonus points
for each outcome and patient experience measure and 1 measure bonus
point for each other high priority measure. Beginning with the 2021 MIPS
payment year, MIPS eligible clinicians do not receive such measure bonus
points for CMS Web Interface measures.
(1) Limitations. (i) Each high priority measure must have a
benchmark at paragraph (b)(1)(ii) of this section, meet the case minimum
requirement at (b)(1)(iii) of this section, meet the data completeness
requirement at Sec. 414.1340, and have a performance rate that is
greater than zero.
(ii) For the 2019, 2020, and 2021 MIPS payment years, the total
measure bonus points for high priority measures cannot exceed 10 percent
of the total available measure achievement points.
(iii) Beginning with the 2021 MIPS payment year, MIPS eligible
clinicians that collect data in accordance with Sec. 414.1325 on a
single measure via multiple collection types receive measure bonus
points only once.
(B) End-to-end electronic reporting. Subject to paragraph
(b)(1)(v)(B)(1) of this section, MIPS eligible clinicians receive 1
measure bonus point for each measure (except claims-based measures)
submitted with end-to-end electronic reporting for a quality measure
under certain criteria determined by the Secretary.
(1) Limitations. (i) For the 2019, 2020, and 2021 MIPS payment
years, the total measure bonus points for measures submitted with end-
to-end electronic reporting cannot exceed 10 percent of the total
available measure achievement points.
(ii) Beginning with the 2021 MIPS payment year, MIPS eligible
clinicians that collect data in accordance with Sec. 414.1325 on a
single measure via multiple collection types receive measure bonus
points only once.
(C) Small practices. Beginning with the 2021 MIPS payment year, MIPS
eligible clinicians in small practices receive 6 measure bonus points if
they submit data to MIPS on at least 1 quality measure.
(vi) Improvement scoring. Improvement scoring is available to MIPS
eligible clinicians that demonstrate improvement in performance in the
current MIPS performance period compared to performance in the
performance period immediately prior to the current MIPS performance
period based on measure achievement points.
(A) Improvement scoring is available when the data sufficiency
standard is met, which means when data are available and a MIPS eligible
clinician has a quality performance category achievement percent score
for the previous performance period and the current performance period.
(1) Data must be comparable to meet the requirement of data
sufficiency which means that the quality performance category
achievement percent score is available for the current performance
period and the previous performance period and quality performance
category achievement percent scores can be compared.
(2) Quality performance category achievement percent scores are
comparable when submissions are received from the same identifier for
two consecutive performance periods.
(3) If the identifier is not the same for 2 consecutive performance
periods, then for individual submissions, the comparable quality
performance category achievement percent score is the highest available
quality performance category achievement percent score associated with
the final score from the prior performance period that will be used for
payment for the individual. For group, virtual group, and APM Entity
submissions, the comparable quality performance category achievement
percent score is the average of the quality performance category
achievement percent score associated with the final score from the prior
performance period that will be used for payment for each of the
individuals in the group.
[[Page 178]]
(4) Improvement scoring is not available for clinicians who were
scored under facility-based measurement in the performance period
immediately prior to the current MIPS performance period.
(B) The improvement percent score may not total more than 10
percentage points.
(C) The improvement percent score is assessed at the performance
category level for the quality performance category and included in the
calculation of the quality performance category percent score as
described in paragraph (b)(1)(vii) of this section.
(1) The improvement percent score is awarded based on the rate of
increase in the quality performance category achievement percent score
of MIPS eligible clinicians from the previous performance period to the
current performance period.
(2) An improvement percent score is calculated by dividing the
increase in the quality performance category achievement percent score
from the prior performance period to the current performance period by
the prior performance period quality performance category achievement
percent score multiplied by 10 percent.
(3) An improvement percent score cannot be lower than zero
percentage points.
(4) For the 2020 and 2021 MIPS payment year, we will assume a
quality performance category achievement percent score of 30 percent if
a MIPS eligible clinician earned a quality performance category score
less than or equal to 30 percent in the previous year.
(5) The improvement percent score is zero if the MIPS eligible
clinician did not fully participate in the quality performance category
for the current performance period.
(D) For the purpose of improvement scoring methodology, the term
``quality performance category achievement percent score'' means the
total measure achievement points divided by the total available measure
achievement points, without consideration of measure bonus points or
improvement percent score.
(E) For the purpose of improvement scoring methodology, the term
``improvement percent score'' means the score that represents
improvement for the purposes of calculating the quality performance
category percent score as described in paragraph (b)(1)(vii) of this
section.
(F) For the purpose of improvement scoring methodology, the term
``fully participate'' means the MIPS eligible clinician met all
requirements in Sec. Sec. 414.1335 and 414.1340.
(vii) Quality performance category score. A MIPS eligible
clinician's quality performance category percent score is the sum of all
the measure achievement points assigned for the measures required for
the quality performance category criteria plus the measure bonus points
in paragraph (b)(1)(v) of this section. The sum is divided by the sum of
total available measure achievement points. The improvement percent
score in paragraph (b)(1)(vi) of this section is added to that result.
The quality performance category percent score cannot exceed 100
percentage points.
(A) Beginning with the 2021 MIPS payment year, for each measure that
a MIPS eligible clinician submits that is significantly impacted by
clinical guideline changes or other changes that CMS believes may result
in patient harm or misleading results, the total available measure
achievement points are reduced by 10 points.
(B) Beginning with the 2021 MIPS payment year, for groups that
submit 5 or fewer measures and register for the CAHPS for MIPS survey
but do not meet the minimum beneficiary sampling requirements, the total
available measure achievement points are reduced by 10 points.
(viii) ICD-10 updates. Beginning with the 2018 MIPS performance
period, measures significantly impacted by ICD-10 updates, as determined
by CMS, will be assessed based only on the first 9 months of the 12-
month performance period. For purposes of this paragraph (b)(1)(viii),
CMS will make a determination as to whether a measure is significantly
impacted by ICD-10 coding changes during the performance period. CMS
will publish on the CMS website which measures require a 9-month
assessment process by October
[[Page 179]]
1st of the performance period if technically feasible, but by no later
than the beginning of the data submission period at Sec.
414.1325(f)(1).
(2) Cost performance category. For each cost measure attributed to a
MIPS eligible clinician, the clinician receives one to ten achievement
points based on the clinician's performance on the measure during the
performance period compared to the measure's benchmark. Achievement
points are awarded based on which benchmark decile range the MIPS
eligible clinician's performance on the measure is between. CMS assigns
partial points based on the percentile distribution.
(i) Cost measure benchmarks are determined by CMS based on cost
measure performance during the performance period. At least 20 MIPS
eligible clinicians or groups must meet the minimum case volume
specified under Sec. 414.1350(c) for a cost measure in order for a
benchmark to be determined for the measure. If a benchmark is not
determined for a cost measure, the measure will not be scored.
(ii) A MIPS eligible clinician must meet the minimum case volume
specified under Sec. 414.1350(c) to be scored on a cost measure.
(iii) The cost performance category percent score is the sum of the
following, not to exceed 100 percent:
(A) The total number of achievement points earned by the MIPS
eligible clinician divided by the total number of available achievement
points; and
(B) The cost improvement score, as determined under paragraph
(b)(2)(iv) of this section.
(iv) The cost improvement score is determined for a MIPS eligible
clinician that demonstrates improvement in performance in the current
MIPS performance period compared to their performance in the immediately
preceding MIPS performance period.
(A) The cost improvement score is determined at the measure level
for the cost performance category.
(B) The cost improvement score is calculated only when data
sufficient to measure improvement is available. Sufficient data is
available when a MIPS eligible clinician or group participates in MIPS
using the same identifier in 2 consecutive performance periods and is
scored on the same cost measure(s) for 2 consecutive performance
periods. If the cost improvement score cannot be calculated because
sufficient data is not available, then the cost improvement score is
zero.
(C) The cost improvement score is determined by comparing the number
of measures with a statistically significant change (improvement or
decline) in performance; a change is determined to be significant based
on application of a t-test. The number of cost measures with a
significant decline is subtracted from the number of cost measures with
a significant improvement, with the result divided by the number of cost
measures for which the MIPS eligible clinician or group was scored for 2
consecutive performance periods. The resulting fraction is then
multiplied by the maximum cost improvement score.
(D) The cost improvement score cannot be lower than zero percentage
points.
(E) The maximum cost improvement score for the 2020, 2021, 2022, and
2023 MIPS payment years is zero percentage points.
(v) A cost performance category percent score is not calculated if a
MIPS eligible clinician or group is not attributed any cost measures for
the performance period because the clinician or group has not met the
minimum case volume specified by CMS for any of the cost measures or a
benchmark has not been created for any of the cost measures that would
otherwise be attributed to the clinician or group.
(3) Improvement activities performance category. Subject to
paragraphs (b)(3)(i) and (ii) of this section, the improvement
activities performance category score equals the total points for all
submitted improvement activities divided by 40 points, multiplied by 100
percent. MIPS eligible clinicians (except for non-patient facing MIPS
eligible clinicians, small practices, and practices located in rural
areas and geographic HPSAs) receive 10 points for each medium-weighted
improvement activity and 20 points for each high-weighted improvement
activity required under Sec. 414.1360 on which data is submitted in
accordance with Sec. 414.1325.
[[Page 180]]
Non-patient facing MIPS eligible clinicians, small practices, and
practices located in rural areas and geographic HPSAs receive 20 points
for each medium-weighted improvement activity and 40 points for each
high-weighted improvement activity required under Sec. 414.1360 on
which data is submitted in accordance with Sec. 414.1325.
(i) For MIPS eligible clinicians participating in APMs, the
improvement activities performance category score is at least 50
percent.
(ii) For MIPS eligible clinicians in a practice that is certified or
recognized as a patient-centered medical home or comparable specialty
practice, as determined by the Secretary, the improvement activities
performance category score is 100 percent. For the 2019 MIPS payment
year, at least one practice site within a group's TIN must be certified
or recognized as a patient-centered medical home or comparable specialty
practice. For the 2020 MIPS payment year and future years, at least 50
percent of the practice sites within a group's TIN must be recognized as
a patient-centered medical home or comparable specialty practice. MIPS
eligible clinicians that wish to claim this status for purposes of
receiving full credit in the improvement activities performance category
must attest to their status as a patient-centered medical home or
comparable specialty practice in order to receive this credit. A
practice is certified or recognized as a patient-centered medical home
if it meets any of the following criteria:
(A) The practice has received accreditation from one of four
accreditation organizations that are nationally recognized;
(1) The Accreditation Association for Ambulatory Health Care;
(2) The National Committee for Quality Assurance (NCQA);
(3) The Joint Commission; or
(4) The Utilization Review Accreditation Commission (URAC).
(B) The practice is participating in a Medicaid Medical Home Model
or Medical Home Model.
(C) The practice is a comparable specialty practice that has
received the NCQA Patient-Centered Specialty Recognition.
(D) The practice has received accreditation from other certifying
bodies that have certified a large number of medical organizations and
meet national guidelines, as determined by the Secretary. The Secretary
must determine that these certifying bodies must have 500 or more
certified member practices, and require practices to include the
following:
(1) Have a personal physician/clinician in a team-based practice.
(2) Have a whole-person orientation.
(3) Provide coordination or integrated care.
(4) Focus on quality and safety.
(5) Provide enhanced access.
(4) Promoting Interoperability performance category. (i) For the
2019 and 2020 MIPS payment years, a MIPS eligible clinician's Promoting
Interoperability performance category score equals the sum of the base
score, performance score, and any applicable bonus scores, not to exceed
100 percentage points. A MIPS eligible clinician cannot earn a
performance score or bonus score unless they have earned a base score.
(A) A MIPS eligible clinician earns a base score by reporting for
each base score measure, as applicable: The numerator (of at least one)
and denominator, or a yes/no statement, or an exclusion.
(B) A MIPS eligible clinician earns a performance score by reporting
on the performance score measures specified by CMS. A MIPS eligible
clinician may earn up to 10 or 20 percentage points as specified by CMS
for each performance score measure reported.
(C) A MIPS eligible clinician may earn the following bonus scores:
(1) A bonus score of 5 percentage points for reporting to one or
more additional public health agencies or clinical data registries.
(2) A bonus score of 10 percentage points for attesting to
completing one or more improvement activities specified by CMS using
CEHRT.
(3) For the 2020 MIPS payment year, a bonus score of 10 percentage
points for submitting data for the measures for the base score and the
performance score generated solely from CEHRT as defined in Sec.
414.1305 for 2019 and subsequent years.
[[Page 181]]
(ii) For the 2021 and 2022 MIPS payment years, a MIPS eligible
clinician's Promoting Interoperability performance category score equals
the sum of the scores for each of the six required measures and any
applicable bonus scores, not to exceed 100 points.
(A) A MIPS eligible clinician earns a score for each measure by
reporting, as applicable: the numerator (of at least one) and
denominator, or a yes/no statement. If an exclusion is reported for a
measure, the points available for that measure are redistributed to
another measure(s).
(B) Each required measure is worth 10, 20, or 40 points, as
specified by CMS.
(C) Each optional measure is worth five bonus points.
(c) Final score calculation. Each MIPS eligible clinician receives a
final score of 0 to 100 points for a performance period for a MIPS
payment year calculated as follows. If a MIPS eligible clinician is
scored on fewer than 2 performance categories, he or she receives a
final score equal to the performance threshold.
------------------------------------------------------------------------
-------------------------------------------------------------------------
For the 2019 MIPS payment year:
Final score = [(quality performance category percent score x quality
performance category weight) + (cost performance category percent
score x cost performance category weight) + (improvement activities
performance category score x improvement activities performance
category weight) + (Promoting Interoperability performance category
score x Promoting Interoperability performance category weight)],
not to exceed 100 points.
For the 2020 MIPS payment year:
Final score = [(quality performance category percent score x quality
performance category weight) + (cost performance category percent
score x cost performance category weight) + (improvement activities
performance category score x improvement activities performance
category weight) + (Promoting Interoperability performance category
score x Promoting Interoperability performance category weight)] x
100 + [the complex patient bonus + the small practice bonus], not
to exceed 100 points.
Beginning with the 2021 MIPS payment year:
Final score = [(quality performance category percent score x quality
performance category weight) + (cost performance category percent
score x cost performance category weight) + (improvement activities
performance category score x improvement activities performance
category weight) + (Promoting Interoperability performance category
score x Promoting Interoperability performance category weight)] x
100 + the complex patient bonus, not to exceed 100 points.
------------------------------------------------------------------------
(1) Performance category weights. The weights of the performance
categories in the final score are as follows, unless a different scoring
weight is assigned under paragraph (c)(2) of this section:
(i) Quality performance category weight is defined under Sec.
414.1330(b).
(ii) Cost performance category weight is defined under Sec.
414.1350(d).
(iii) Improvement activities performance category weight is defined
under Sec. 414.1355(b).
(iv) Promoting Interoperability performance category weight is
defined under Sec. 414.1375(a).
(2) Reweighting the performance categories. (i) In accordance with
paragraph (c)(2)(ii) of this section, a scoring weight different from
the weights specified in paragraph (c)(1) of this section will be
assigned to a performance category, and its weight as specified in
paragraph (c)(1) of this section will be redistributed to another
performance category or categories, in the following circumstances:
(A) CMS determines based on the following circumstances that there
are not sufficient measures and activities applicable and available
under section 1848(q)(5)(F) of the Act.
(1) For the quality performance category, CMS cannot calculate a
score for the MIPS eligible clinician because there is not at least one
quality measure applicable and available to the clinician.
[[Page 182]]
(2) For the cost performance category, CMS cannot reliably calculate
a score for the cost measures that adequately captures and reflects the
performance of the MIPS eligible clinician.
(3) Beginning with the 2021 MIPS payment year, for the quality,
cost, improvement activities, and Promoting Interoperability performance
categories, the MIPS eligible clinician joins an existing practice
during the final 3 months of the performance period year that is not
participating in MIPS as a group or joins a practice that is newly
formed during the final 3 months of the performance period year.
(4) For the Promoting Interoperability performance category
beginning with the 2021 MIPS payment year, the MIPS eligible clinician
is a physical therapist, occupational therapist, clinical psychologist,
qualified audiologist, qualified speech-language pathologist, or a
registered dietitian or nutrition professional. In the event that a MIPS
eligible clinician submits data for the Promoting Interoperability
performance category, the scoring weight specified in paragraph (c)(1)
of this section will be applied and its weight will not be
redistributed.
(5) For the Promoting Interoperability performance category for the
2019, 2020, and 2021 MIPS payment years, the MIPS eligible clinician is
a nurse practitioner, physician assistant, clinical nurse specialist, or
certified registered nurse anesthetist. In the event that a MIPS
eligible clinician submits data for the Promoting Interoperability
performance category, the scoring weight specified in paragraph (c)(1)
of this section will be applied and its weight will not be
redistributed.
(6) Beginning with the 2020 MIPS payment year, for the quality,
cost, and improvement activities performance categories, the MIPS
eligible clinician demonstrates through an application submitted to CMS
that they were subject to extreme and uncontrollable circumstances that
prevented the clinician from collecting information that the clinician
would submit for a performance category or submitting information that
would be used to score a performance category for an extended period of
time. Beginning with the 2021 MIPS payment year, in the event that a
MIPS eligible clinician submits data for the quality, cost, or
improvement activities performance categories, the scoring weight
specified in paragraph (c)(1) of this section will be applied and its
weight will not be redistributed.
(7) For the 2019 MIPS payment year, for the quality and improvement
activities performance categories, the MIPS eligible clinician was
located in an area affected by extreme and uncontrollable circumstances
as identified by CMS. In the event that a MIPS eligible clinician
submits data for a performance category, the scoring weight specified in
paragraph (c)(1) of this section will be applied and its weight will not
be redistributed.
(8) Beginning with the 2020 MIPS payment year, for the quality,
cost, and improvement activities performance categories, the MIPS
eligible clinician was located in an area affected by extreme and
uncontrollable circumstances as identified by CMS. In the event that a
MIPS eligible clinician submits data for the quality or improvement
activities performance categories, the scoring weight specified in
paragraph (c)(1) of this section will be applied and its weight will not
be redistributed.
(B) Under section 1848(q)(5)(E)(ii) of the Act, CMS estimates that
the proportion of MIPS eligible clinicians who are physicians as defined
in section 1861(r) of the Act and earn a Promoting Interoperability
performance category score of at least 75 percent is 75 percent or
greater. The estimation is based on data from the performance period
that occurs four years before the MIPS payment year and does not include
physicians for whom the Promoting Interoperability performance category
is weighted at zero percent.
(C) Under section 1848(o)(2)(D) of the Act, a significant hardship
exception or other type of exception is granted to a MIPS eligible
clinician based on the following circumstances for the Promoting
Interoperability performance category. In the event that a MIPS eligible
clinician submits data for the Promoting Interoperability performance
category, the scoring weight specified in paragraph (c)(1) of this
section
[[Page 183]]
will be applied and its weight will not be redistributed.
(1) The MIPS eligible clinician demonstrates through an application
submitted to CMS that they lacked sufficient internet access during the
performance period, and insurmountable barriers prevented the clinician
from obtaining sufficient internet access.
(2) The MIPS eligible clinician demonstrates through an application
submitted to CMS that they were subject to extreme and uncontrollable
circumstances that caused their CEHRT to be unavailable.
(3) The MIPS eligible clinician was located in an area affected by
extreme and uncontrollable circumstances as identified by CMS.
(4) The MIPS eligible clinician demonstrates through an application
submitted to CMS that 50 percent or more of their outpatient encounters
occurred in practice locations where they had no control over the
availability of CEHRT.
(5) The MIPS eligible clinician is a non-patient facing MIPS
eligible clinician as defined in Sec. 414.1305.
(6) The MIPS eligible clinician is a hospital-based MIPS eligible
clinician as defined in Sec. 414.1305.
(7) The MIPS eligible clinician is an ASC-based MIPS eligible
clinician as defined in Sec. 414.1305.
(8) Beginning with the 2020 MIPS payment year, the MIPS eligible
clinician demonstrates through an application submitted to CMS that
their CEHRT was decertified either during the performance period for the
MIPS payment year or during the calendar year preceding the performance
period for the MIPS payment year, and the MIPS eligible clinician made a
good faith effort to adopt and implement another CEHRT in advance of the
performance period. In no case may a MIPS eligible clinician be granted
this exception for more than 5 years.
(9) Beginning with the 2020 MIPS payment year, the MIPS eligible
clinician demonstrates through an application submitted to CMS that they
are in a small practice as defined in Sec. 414.1305, and overwhelming
barriers prevent them from complying with the requirements for the
Promoting Interoperability performance category.
(ii) A scoring weight different from the weights specified in
paragraph (c)(1) of this section will be assigned to a performance
category, and its weight as specified in paragraph (c)(1) of this
section will be redistributed to another performance category or
categories, as follows:
(A) For the 2019 MIPS payment year:
----------------------------------------------------------------------------------------------------------------
Reweight Reweight Reweight
scenario if no scenario if no scenario if no
Weighting for promoting quality improvement
Performance category (%) the 2019 MIPS interoperability performance activities
payment year performance category performance
(%) category score percent score category score
(%) (%) (%)
----------------------------------------------------------------------------------------------------------------
Quality....................................... 60 85 0 75
Cost.......................................... 0 0 0 0
Improvement Activities........................ 15 15 50 0
Promoting Interoperability.................... 25 0 50 25
----------------------------------------------------------------------------------------------------------------
(B) For the 2020 MIPS payment year:
----------------------------------------------------------------------------------------------------------------
Promoting
Reweighting scenario Quality (%) Cost (%) Improvement interoperability
activities (%) (%)
----------------------------------------------------------------------------------------------------------------
No Reweighting Needed:
--Scores for all four performance 50 10 15 25
categories...............................
Reweight One Performance Category:
--No Cost................................. 60 0 15 25
--No Promoting Interoperability........... 75 10 15 0
--No Quality.............................. 0 10 45 45
--No Improvement Activities............... 65 10 0 25
Reweight Two Performance Categories:
[[Page 184]]
--No Cost and no Promoting 85 0 15 0
Interoperability.........................
--No Cost and no Quality.................. 0 0 50 50
--No Cost and no Improvement Activities... 75 0 0 25
--No Promoting Interoperability and no 0 10 90 0
Quality..................................
--No Promoting Interoperability and no 90 10 0 0
Improvement Activities...................
--No Quality and no Improvement Activities 0 10 0 90
----------------------------------------------------------------------------------------------------------------
(C) For the 2021 MIPS payment year:
----------------------------------------------------------------------------------------------------------------
Promoting
Reweighting scenario Quality (%) Cost (%) Improvement interoperability
activities (%) (%)
----------------------------------------------------------------------------------------------------------------
No Reweighting Needed:
--Scores for all four performance 45 15 15 25
categories...............................
Reweight One Performance Category:
--No Cost................................. 60 0 15 25
--No Promoting Interoperability........... 70 15 15 0
--No Quality.............................. 0 15 40 45
--No Improvement Activities............... 60 15 0 25
Reweight Two Performance Categories:
--No Cost and no Promoting 85 0 15 0
Interoperability.........................
--No Cost and no Quality.................. 0 0 50 50
--No Cost and no Improvement Activities... 75 0 0 25
--No Promoting Interoperability and no 0 15 85 0
Quality..................................
--No Promoting Interoperability and no 85 15 0 0
Improvement Activities...................
--No Quality and no Improvement Activities 0 15 0 85
----------------------------------------------------------------------------------------------------------------
(iii) For MIPS eligible clinicians submitting data as a group or
virtual group, in order for the Promoting Interoperability performance
category to be reweighted in accordance with paragraph (c)(2)(ii) of
this section, all of the MIPS eligible clinicians in the group must
qualify for reweighting based on the circumstances described in
paragraph (c)(2)(i) of this section.
(3) Complex patient bonus. For the 2020 and 2021 MIPS payment years,
provided that a MIPS eligible clinician, group, virtual group or APM
entity submits data for at least one MIPS performance category for the
applicable performance period for the MIPS payment year, a complex
patient bonus will be added to the final score for the MIPS payment
year, as follows:
(i) For MIPS eligible clinicians and groups, the complex patient
bonus is calculated as follows: [The average HCC risk score assigned to
beneficiaries (pursuant to the HCC risk adjustment model established by
CMS pursuant to section 1853(a)(1) of the Act) seen by the MIPS eligible
clinician or seen by clinicians in a group] + [the dual eligible ratio x
5].
(ii) For APM entities and virtual groups, the complex patient bonus
is calculated as follows: [The beneficiary weighted average HCC risk
score for all MIPS eligible clinicians, and if technically feasible,
TINs for models and virtual groups which rely on complete TIN
participation within the APM entity or virtual group, respectively] +
[the average dual eligible ratio for all MIPS eligible clinicians, and
if technically feasible, TINs for models and virtual groups which rely
on complete TIN participation, within the APM entity or virtual group,
respectively, x 5].
(iii) The complex patient bonus cannot exceed 5.0.
(4) Small practice bonus. A small practice bonus of 5 points will be
added to the final score for the 2020 MIPS payment year for MIPS
eligible clinicians, groups, virtual groups, and APM Entities that meet
the definition of a small practice as defined at Sec. 414.1305 and
participate in MIPS by submitting data on at least one performance
category in the 2018 MIPS performance period.
[[Page 185]]
(d) Scoring for APM Entities. MIPS eligible clinicians in APM
Entities that are subject to the APM scoring standard are scored using
the methodology under Sec. 414.1370.
(e) Scoring for facility-based measurement. For the payment in 2021
MIPS payment year and subsequent years and subject to paragraph
(e)(6)(vi) of this section, a MIPS eligible clinician or group will be
scored under the quality and cost performance categories using the
methodology described in this paragraph (e).
(1) General. The facility-based measurement scoring standard is the
MIPS scoring methodology applicable for MIPS eligible clinicians
identified as meeting the requirements in paragraph (e)(2) of this
section.
(i) The measures used for facility-based measurement are the measure
set finalized for the fiscal year value-based purchasing program for
which payment begins during the applicable MIPS performance period.
(ii) Beginning with the 2021 MIPS payment year, the scoring
methodology applicable for MIPS eligible clinicians scored with
facility-based measurement is the Total Performance Score methodology
adopted for the Hospital VBP Program, for the fiscal year for which
payment begins during the applicable MIPS performance period.
(2) Eligibility for facility-based measurement. MIPS eligible
clinicians are eligible for facility-based measurement for a MIPS
payment year if they are determined to be facility-based as an
individual clinician or as part of a group, as follows:
(i) Facility-based individual determination. A MIPS eligible
clinician is facility-based if the clinician meets all of the following
criteria:
(A) Furnishes 75 percent or more of his or her covered professional
services in sites of service identified by the place of service codes
used in the HIPAA standard transaction as an inpatient hospital, on-
campus outpatient hospital, or emergency room setting based on claims
for a 12-month segment beginning on October 1 of the calendar year 2
years prior to the applicable performance period and ending on September
30 of the calendar year preceding the performance period with a 30-day
claims run out.
(B) Furnishes at least 1 covered professional service in sites of
service identified by the place of service codes used in the HIPAA
standard transaction as an inpatient hospital, or emergency room
setting.
(C) Can be attributed, under the methodology specified in paragraph
(e)(5) of this section, to a facility with a value-based purchasing
score for the applicable period.
(ii) Facility-based group determination. A facility-based group is a
group in which 75 percent or more of its eligible clinician NPIs billing
under the group's TIN meet the requirements under paragraph (e)(2)(i) of
this section.
(3) [Reserved]
(4) Data submission for facility-based measurement. There are no
data submission requirements for individual clinicians to be scored
under facility-based measurement. A group must submit data in the
improvement activities or Promoting Interoperability performance
categories in order to be scored as a facility-based group.
(5) Determination of applicable facility score. (i) A facility-based
clinician is scored with facility-based measurement using the score
derived from the value-based purchasing score for the facility at which
the clinician provided services to the most Medicare beneficiaries
during the period the claims are drawn from in paragraph (e)(2) of this
section. If there is an equal number of Medicare beneficiaries treated
at more than one facility, the value-based purchasing score for the
highest scoring facility is used.
(ii) A facility-based group is scored with facility-based
measurement using the score derived from the value-based purchasing
score for the facility at which the plurality of clinicians identified
as facility-based would have had their score determined under paragraph
(e)(5)(i) of this section.
(6) MIPS performance category scoring under the facility-based
measurement scoring standard--(i) Measures. The quality and cost
measures are those adopted under the value-based purchasing program of
the facility for the year described in paragraph (e)(1)(i) of this
section.
[[Page 186]]
(ii) Benchmarks. The benchmarks are those adopted under the value-
based purchasing program of the facility program for the year described
in paragraph (e)(1) of this section.
(iii) Performance period. The performance period for facility-based
measurement is the performance period for the measures adopted under the
value-based purchasing program of the facility program for the year
described in paragraph (e)(1) of this section.
(iv) Quality. The quality performance category percent score is
established by determining the percentile performance of the facility in
the value-based purchasing program for the specified year as described
in paragraph (e)(1) of this section and awarding a score associated with
that same percentile performance in the MIPS quality performance
category percent score for those MIPS-eligible clinicians who are not
eligible to be scored using facility-based measurement for the MIPS
payment year. A clinician or group receiving a facility-based
performance score will not earn improvement points based on prior
performance in the MIPS quality performance category
(v) Cost. The cost performance category percent score is established
by determining the percentile performance of the facility in the value-
based purchasing program for the specified year as described in
paragraph (e)(1) of this section and awarding a score associated with
that same percentile performance in the MIPS cost performance category
percent score for those MIPS eligible clinicians who are not eligible to
be scored using facility-based measurement for the MIPS payment year. A
clinician or group receiving a facility-based performance score will not
earn improvement points based on prior performance in the MIPS cost
category.
(A) Other cost measures. MIPS eligible clinicians who are scored
under facility-based measurement are not scored on cost measures
described in paragraph (b)(2) of this section.
(B) [Reserved]
(vi) Use of score from facility-based measurement. The MIPS quality
and cost performance category scores will be based on the facility-based
measurement scoring methodology described in paragraph (e)(6) of this
section unless a clinician or group receives a higher combined MIPS
quality and cost performance category score through another MIPS
submission.
[83 FR 60081, Nov. 23, 2018]
Sec. 414.1385 Targeted review and review limitations.
(a) Targeted review. MIPS eligible clinicians or groups may request
a targeted review of the calculation of the MIPS payment adjustment
factor under section 1848(q)(6)(A) of the Act and, as applicable, the
calculation of the additional MIPS payment adjustment factor under
section 1848(q)(6)(C) of the Act applicable to such MIPS eligible
clinician or group for a year. The process for targeted reviews is:
(1) MIPS eligible clinicians and groups have a 60-day period to
submit a request for targeted review, which begins on the day CMS makes
available the MIPS payment adjustment factor, and if applicable the
additional MIPS payment adjustment factor, for the MIPS payment year and
ends on September 30 of the year prior to the MIPS payment year or a
later date specified by CMS.
(2) CMS will respond to each request for targeted review timely
submitted and determine whether a targeted review is warranted.
(3) The MIPS eligible clinician or group may include additional
information in support of their request for targeted review at the time
the request is submitted. If CMS requests additional information from
the MIPS eligible clinician or group, it must be provided and received
by CMS within 30 days of the request. Non-responsiveness to the request
for additional information may result in the closure of the targeted
review request, although the MIPS eligible clinician or group may submit
another request for targeted review before the deadline.
(4) Decisions based on the targeted review are final, and there is
no further review or appeal.
(b) Limitations on review. Except as specified in paragraph (a)(4)
of this section, there is no administrative or judicial review under
section 1869 or 1879 of the Act, or otherwise of--
[[Page 187]]
(1) The methodology used to determine the amount of the MIPS payment
adjustment factor and the amount of the additional MIPS payment
adjustment factor and the determination of such amounts;
(2) The establishment of the performance standards and the
performance period;
(3) The identification of measures and activities specified for a
MIPS performance category and information made public or posted on the
Physician Compare Internet Web site of the CMS; and
(4) The methodology developed that is used to calculate performance
scores and the calculation of such scores, including the weighting of
measures and activities under such methodology.
Sec. 414.1390 Data validation and auditing.
(a) General. CMS will selectively audit MIPS eligible clinicians and
groups on a yearly basis. If a MIPS eligible clinician or group is
selected for audit, the MIPS eligible clinician or group will be
required to do the following in accordance with applicable law and
timelines CMS establishes:
(1) Comply with data sharing requests, providing all data as
requested by CMS or our designated entity. All data must be shared with
CMS or our designated entity within 45 days of the data sharing request,
or an alternate timeframe that is agreed to by CMS and the MIPS eligible
clinician or group. Data will be submitted via email, facsimile, or an
electronic method via a secure Web site maintained by CMS.
(2) Provide substantive, primary source documents as requested.
These documents may include: Copies of claims, medical records for
applicable patients, or other resources used in the data calculations
for MIPS measures, objectives, and activities. Primary source
documentation also may include verification of records for Medicare and
non-Medicare beneficiaries where applicable.
(b) Certification. All MIPS eligible clinicians and groups that
submit data and information to CMS for purposes of MIPS must certify to
the best of their knowledge that the data submitted to CMS is true,
accurate, and complete. Such certification must accompany the submission
and be made at the time of submission.
(c) Reopening. CMS may reopen and revise a MIPS payment adjustment
in accordance with the rules set forth at Sec. Sec. 405.980 through
405.986 of this chapter.
(d) Record retention. All MIPS eligible clinicians and groups that
submit data and information to CMS for purposes of MIPS must retain such
data and information for 6 years from the end of the MIPS performance
period.
[81 FR 77537, Nov. 4, 2016, as amended at 82 FR 53959, Nov. 16, 2017]
Sec. 414.1395 Public reporting.
(a) Public reporting of eligible clinician and group Quality Payment
Program information. For each program year, CMS posts on Physician
Compare, in an easily understandable format, information regarding the
performance of eligible clinicians or groups under the Quality Payment
Program.
(b) Maintain existing public reporting standards. With the exception
of data that must be mandatorily reported on Physician Compare, for each
program year, CMS relies on established public reporting standards to
guide the information available for inclusion on Physician Compare. The
public reporting standards require data included on Physician Compare to
be statistically valid, reliable, and accurate; comparable across
collection types; and meet the reliability threshold. And, to be
included on the public facing profile pages, the data must also resonate
with website users, as determined by CMS.
(c) First year measures. For each program year, CMS does not
publicly report any first year measure for the first 2 years, meaning
any measure in its first 2 years of use in the quality and cost
performance categories. After the first 2 years, CMS reevaluates
measures to determine when and if they are suitable for public
reporting.
(d) 30-day preview period. For each program year, CMS provides a 30-
day preview period for any clinician or group with Quality Payment
Program
[[Page 188]]
data before the data are publicly reported on Physician Compare.
[82 FR 53959, Nov. 16, 2017, as amended at 83 FR 60087, Nov. 23, 2018]
Sec. 414.1400 Third party intermediaries.
(a) General. (1) MIPS data may be submitted on behalf of a MIPS
eligible clinician, group, or virtual group by any of the following
third party intermediaries:
(i) A QCDR;
(ii) A qualified registry;
(iii) A health IT vendor; or
(iv) A CMS-approved survey vendor.
(2) QCDRs, qualified registries, and health IT vendors may submit
MIPS data for any of the following MIPS performance categories:
(i) Quality, except for data on the CAHPS for MIPS survey;
(ii) Improvement activities; or
(iii) Promoting Interoperability, if the MIPS eligible clinician,
group, or virtual group is using CEHRT.
(3) CMS-approved survey vendors may submit data on the CAHPS for
MIPS survey for the MIPS quality performance category.
(4) To be approved as a third party intermediary, an entity must
agree to meet the applicable requirements of this section, including,
but not limited to, the following:
(i) A third party intermediary's principle place of business and
retention of any data must be based in the U.S.
(ii) If the data is derived from CEHRT, a QCDR, qualified registry,
or health IT vendor must be able to indicate its data source.
(iii) All data must be submitted in the form and manner specified by
CMS.
(iv) If the clinician chooses to opt-in in accordance with Sec.
414.1310, the third party intermediary must be able to transmit that
decision to CMS.
(5) All data submitted to CMS by a third party intermediary on
behalf of a MIPS eligible clinician, group or virtual group must be
certified by the third party intermediary as true, accurate, and
complete to the best of its knowledge. Such certification must be made
in a form and manner and at such time as specified by CMS.
(b) QCDR approval criteria--(1) QCDR self-nomination. For the 2020
and 2021 MIPS payment years, entities seeking to qualify as a QCDR must
self-nominate September 1 until November 1 of the CY preceding the
applicable performance period. For the 2022 MIPS payment year and future
years, entities seeking to qualify as a QCDR must self-nominate during a
60-day period during the CY preceding the applicable performance period
(beginning no earlier than July 1 and ending no later than September 1).
Entities seeking to qualify as a QCDR for a performance period must
provide all information required by CMS at the time of self-nomination
and must provide any additional information requested by CMS during the
review process. For the 2021 MIPS payment year and future years,
existing QCDRs that are in good standing may attest that certain aspects
of their previous year's approved self-nomination have not changed and
will be used for the applicable performance period.
(2) Establishment of a QCDR entity. (i) Beginning with the 2022 MIPS
Payment Year, the QCDR must have at least 25 participants by January 1
of the year prior to the applicable performance period.
(ii) If the entity uses an external organization for purposes of
data collection, calculation, or transmission, it must have a signed,
written agreement with the external organization that specifically
details the responsibilities of the entity and the external
organization. The written agreement must be effective as of September 1
of the year preceding the applicable performance period.
(3) QCDR measures for the quality performance category. (i) For
purposes of QCDRs submitting data for the MIPS quality performance
category, CMS considers the following types of quality measures to be
QCDR measures:
(A) Measures that are not included in the MIPS final list of quality
measures described in Sec. 414.1330(a)(1) for the applicable MIPS
payment year; and
(B) Measures that are included in the MIPS final list of quality
measures described in Sec. 414.1330(a)(1) for the applicable MIPS
payment year, but have undergone substantive changes, as determined by
CMS.
(ii) For the 2020 MIPS payment year and future years, an entity
seeking to
[[Page 189]]
become a QCDR must submit specifications for each measure, activity, and
objective that the entity intends to submit to for MIPS (including the
information described in paragraphs (b)(3)(ii)(A) and (B) of this
section) at the time of self-nomination. In addition, no later than 15
calendar days following CMS approval of any QCDR measure specifications,
the entity must publicly post the measure specifications for each QCDR
measure (including the CMS-assigned QCDR measure ID) and provide CMS
with a link to where this information is posted.
(A) For QCDR measures, the entity must submit the measure
specifications for each QCDR measure, including: Name/title of measures,
NQF number (if NQF-endorsed), descriptions of the denominator,
numerator, and when applicable, denominator exceptions, denominator
exclusions, risk adjustment variables, and risk adjustment algorithms.
(B) For MIPS quality measures, the entity must submit the MIPS
measure IDs and specialty-specific measure sets, as applicable.
(iii) A QCDR must include the CMS-assigned QCDR measure ID when
submitting data on any QCDR measure to CMS.
(c) Qualified registry approval criteria--(1) Qualified registry
self-nomination. For the 2020 and 2021 MIPS payment years, entities
seeking to qualify as a qualified registry must self-nominate from
September 1 until November 1 of the CY preceding the applicable
performance period. For the 2022 MIPS payment year and future years,
entities seeking to qualify as a qualified registry must self-nominate
during a 60-day period during the CY preceding the applicable
performance period (beginning no earlier than July 1 and ending no later
than September 1). Entities seeking to qualify as a qualified registry
for a performance period must provide all information required by CMS at
the time of self-nomination and must provide any additional information
requested by CMS during the review process. For the 2021 MIPS payment
year and future years, existing qualified registries that are in good
standing may attest that certain aspects of their previous year's
approved self-nomination have not changed and will be used for the
applicable performance period.
(2) Establishment of a qualified registry entity. Beginning with the
2022 MIPS Payment Year, the qualified registry must have at least 25
participants by January 1 of the year prior to the applicable
performance period.
(d) Health IT vendor approval criteria. Health IT vendors must meet
the criteria specified at paragraph (a)(4) of this section.
(e) CMS-approved survey vendor approval criteria. Entities seeking
to be a CMS-approved survey vendor for any MIPS performance period must
submit a survey vendor application to CMS in a form and manner specified
by CMS for each MIPS performance period for which it wishes to transmit
such data. The application and any supplemental information requested by
CMS must be submitted by deadlines specified by CMS. For an entity to be
a CMS-approved survey vendor, it must meet the following criteria:
(1) The entity must have sufficient experience, capability, and
capacity to accurately report CAHPS data, including:
(i) At least 3 years of experience administering mixed-mode surveys
(that is, surveys that employ multiple modes to collect date), including
mail survey administration followed by survey administration via
Computer Assisted Telephone Interview (CATI);
(ii) At least 3 years of experience administering surveys to a
Medicare population;
(iii) At least 3 years of experience administering CAHPS surveys
within the past 5 years;
(iv) Experience administering surveys in English and at least one
other language for which a translation of the CAHPS for MIPS survey is
available;
(v) Use equipment, software, computer programs, systems, and
facilities that can verify addresses and phone numbers of sampled
beneficiaries, monitor interviewers, collect data via CATI,
electronically administer the survey and schedule call-backs to
beneficiaries at varying times of the day and week, track fielded
surveys, assign final disposition codes to reflect the outcome of data
collection of each
[[Page 190]]
sampled case, and track cases from mail surveys through telephone
follow-up activities; and
(vi) Employment of a program manager, information systems
specialist, call center supervisor and mail center supervisor to
administer the survey.
(2) The entity has certified that it has the ability to maintain and
transmit quality data in a manner that preserves the security and
integrity of the data.
(3) The entity has successfully completed, and has required its
subcontractors to successfully complete, vendor training(s) administered
by CMS or its contractors.
(4) The entity has submitted a quality assurance plan and other
materials relevant to survey administration, as determined by CMS,
including cover letters, questionnaires and telephone scripts.
(5) The entity has agreed to participate and cooperate, and has
required its subcontractors to participate and cooperate, in all
oversight activities related to survey administration conducted by CMS
or its contractors.
(6) The entity has sent an interim survey data file to CMS that
establishes the entity's ability to accurately report CAHPS data.
(f) Remedial action and termination of third party intermediaries.
(1) If CMS determines that a third party intermediary has ceased to meet
one or more of the applicable criteria for approval, or has submitted
data that is inaccurate, unusable, or otherwise compromised, CMS may
take one or more of the following remedial actions after providing
written notice to the third party intermediary:
(i) Require the third party intermediary to submit a corrective
action plan (CAP) to CMS to address the identified deficiencies or data
issue, including the actions it will take to prevent the deficiencies or
data issues from recurring. The CAP must be submitted to CMS by a date
specified by CMS.
(ii) Publicly disclose the entity's data error rate on the CMS
website until the data error rate falls below 3 percent.
(2) CMS may immediately or with advance notice terminate the ability
of a third party intermediary to submit MIPS data on behalf of a MIPS
eligible clinician, group, or virtual group for one or more of the
following reasons:
(i) CMS has grounds to impose remedial action;
(ii) CMS has not received a CAP within the specified time period or
the CAP is not accepted by CMS; or
(iii) The third party intermediary fails to correct the deficiencies
or data errors by the date specified by CMS.
(3) For purposes of paragraph (f) of this section, CMS may determine
that submitted data is inaccurate, unusable, or otherwise compromised if
the submitted data:
(i) Includes, without limitation, TIN/NPI mismatches, formatting
issues, calculation errors, or data audit discrepancies; and
(ii) Affects more than 3 percent of the total number of MIPS
eligible clinicians or group for which data was submitted by the third
party intermediary.
(g) Auditing of entities submitting MIPS data. Any third party
intermediary must comply with the following procedures as a condition of
its qualification and approval to participate in MIPS as a third party
intermediary.
(1) The entity must make available to CMS the contact information of
each MIPS eligible clinician or group on behalf of whom it submits data.
The contact information must include, at a minimum, the MIPS eligible
clinician or group's practice phone number, address, and, if available,
email.
(2) The entity must retain all data submitted to CMS for purposes of
MIPS for 6 years from the end of the MIPS performance period.
(3) For the purposes of auditing, CMS may request any records or
data retained for the purposes of MIPS for up to 6 years from the end of
the MIPS performance period.
[83 FR 60088, Nov. 23, 2018]
Sec. 414.1405 Payment.
(a) General. Each MIPS eligible clinician receives a MIPS payment
adjustment factor, and if applicable an additional MIPS payment
adjustment factor for exceptional performance, for a MIPS payment year
determined by
[[Page 191]]
comparing their final score to the performance threshold and additional
performance threshold for the year.
(b) Performance threshold. A performance threshold will be specified
for each MIPS payment year.
(1) MIPS eligible clinicians with a final score at or above the
performance threshold receive a zero or positive MIPS payment adjustment
factor on a linear sliding scale such that an adjustment factor of 0
percent is assigned for a final score at the performance threshold and
an adjustment factor of the applicable percent is assigned for a final
score of 100.
(2) MIPS eligible clinicians with a final score below the
performance threshold receive a negative MIPS payment adjustment factor
on a linear sliding scale such that an adjustment factor of 0 percent is
assigned for a final score at the performance threshold and an
adjustment factor of the negative of the applicable percent is assigned
for a final score of 0; further, MIPS eligible clinicians with final
scores that are equal to or greater than zero, but not greater than one-
fourth of the performance threshold, receive a negative MIPS payment
adjustment factor that is equal to the negative of the applicable
percent.
(3) A scaling factor not to exceed 3.0 may be applied to positive
MIPS payment adjustment factors to ensure budget neutrality such that
the estimated increase in aggregate allowed charges resulting from the
application of the positive MIPS payment adjustment factors for the MIPS
payment year equals the estimated decrease in aggregate allowed charges
resulting from the application of negative MIPS payment adjustment
factors for the MIPS payment year.
(4) The performance threshold for the 2019 MIPS payment year is 3
points.
(5) The performance threshold for the 2020 MIPS payment year is 15
points.
(6) The performance threshold for the 2021 MIPS payment year is 30
points.
(c) Applicable percent. For MIPS payment year 2019, 4 percent. For
MIPS payment year 2020, 5 percent. For MIPS payment year 2021, 7
percent. For MIPS payment year 2022 and each subsequent MIPS payment
year, 9 percent.
(d) Additional performance threshold. An additional performance
threshold will be specified for each of the MIPS payment years 2019
through 2024.
(1) In addition to the MIPS payment adjustment factor, MIPS eligible
clinicians with a final score at or above the additional performance
threshold receive an additional MIPS payment adjustment factor for
exceptional performance on a linear sliding scale such that an
additional adjustment factor of 0.5 percent is assigned for a final
score at the additional performance threshold and an additional
adjustment factor of 10 percent is assigned for a final score of 100,
subject to the application of a scaling factor as determined by CMS,
such that the estimated aggregate increase in payments resulting from
the application of the additional MIPS payment adjustment factors for
the MIPS payment year shall not exceed $500,000,000 for each of the MIPS
payment years 2019 through 2024.
(2) [Reserved]
(3) The additional performance threshold for the 2019 MIPS payment
year is 70 points.
(4) The additional performance threshold for the 2020 MIPS payment
year is 70 points.
(5) The additional performance threshold for the 2021 MIPS payment
year is 75 points.
(e) Application of adjustments to payments. Except as specified in
paragraph (f) of this section, in the case of covered professional
services (as defined in section 1848(k)(3)(A) of the Act) furnished by a
MIPS eligible clinician during a MIPS payment year beginning with 2019,
the amount otherwise paid under Part B with respect to such covered
professional services and MIPS eligible clinician for such year, is
multiplied by 1, plus the sum of the MIPS payment adjustment factor
divided by 100, and as applicable, the additional MIPS payment
adjustment factor divided by 100.
(f) Exception to application of MIPS payment adjustment factors to
model-specific payments under section 1115A APMs. Effective for the 2019
MIPS payment year, the payment adjustment factors specified under
paragraph (e) of this section are not applicable to payments
[[Page 192]]
that meet all of the following conditions:
(1) Are made only to participants in a model tested under section
1115A of the Act;
(2) Would otherwise be subject to the requirement to apply the MIPS
payment adjustment factors if the payment is made with respect to a MIPS
eligible clinician participating in a section 1115A model; and
(3) Either have a specified payment amount or are paid according to
a methodology for calculating a model-specific payment that is applied
in a consistent manner to all model participants, such that application
of the MIPS payment adjustment factors would potentially interfere with
CMS's ability to effectively evaluate the impact of the APM.
[81 FR 77537, Nov. 4, 2016, as amended at 82 FR 53960, Nov. 16, 2017; 83
FR 60089, Nov. 23, 2018]
Sec. 414.1410 Advanced APM determination.
(a) General. An APM is an Advanced APM for a payment year if CMS
determines that it meets the criteria in Sec. 414.1415 during the QP
Performance Period.
(b) Advanced APM determination process. CMS determines Advanced APMs
in the following manner:
(1) Advanced APM determination. (i) No later than January 1, 2017,
CMS will post on its Web site a list of all Advanced APMs for the first
QP Performance Period.
(ii) CMS updates the Advanced APM list on its Web site at intervals
no less than annually.
(iii) CMS will include notice of whether a new APM is an Advanced
APM in the first public notice of the new APM.
(2) [Reserved]
[81 FR 77537, Nov. 4, 2016, as amended at 82 FR 53960, Nov. 16, 2017]
Sec. 414.1415 Advanced APM criteria.
(a) Use of certified electronic health record technology (CEHRT)--
(1) Required use of CEHRT. To be an Advanced APM, an APM must:
(i) Require at least 50 percent, or for QP Performance Periods
beginning in 2019, 75 percent of eligible clinicians in each
participating APM Entity group, or for APMs in which hospitals are the
APM Entities, each hospital, to use CEHRT to document and communicate
clinical care to their patients or health care providers; or
(ii) For QP Performance Periods prior to 2019, for the Shared
Savings Program, apply a penalty or reward to an APM Entity based on the
degree of the use of CEHRT of the eligible clinicians in the APM Entity.
(b) Payment based on quality measures. (1) To be an Advanced APM, an
APM must include quality measure performance as a factor when
determining payment to participants for covered professional services
under the terms of the APM.
(2) At least one of the quality measures upon which an Advanced APM
bases the payment in paragraph (b)(1) of this section must have an
evidence-based focus, be reliable and valid, and meet at least one of
the following criteria:
(i) Used in the MIPS quality performance category as described in
Sec. 414.1330;
(ii) Endorsed by a consensus-based entity;
(iii) Developed under section 1848(s) of the Act;
(iv) Submitted in response to the MIPS Call for Quality Measures
under section 1848(q)(2)(D)(ii) of the Act; or
(v) Any other quality measures that CMS determines to have an
evidence-based focus and to be reliable and valid.
(3) In addition to the quality measure requirements under paragraph
(b)(2) of this section, the quality measures upon which an Advanced APM
bases the payment in paragraph (b)(1) of this section must include at
least one outcome measure. This requirement does not apply if CMS
determines that there are no available or applicable outcome measures
included in the MIPS quality measures list for the Advanced APM's first
QP Performance Period.
(c) Financial risk. To be an Advanced APM, except as described in
paragraph (c)(6) of this section, an APM must either meet the financial
risk standard under paragraph (c)(1) or (2) of this section and the
nominal amount standard under paragraph (c)(3) or (4) of this section or
be an expanded Medical Home
[[Page 193]]
Model under section 1115A(c) of the Act.
(1) Generally applicable financial risk standard. Except for
paragraph (c)(2) of this section, to be an Advanced APM, an APM must,
based on whether an APM Entity's actual expenditures for which the APM
Entity is responsible under the APM exceed expected expenditures during
a specified QP Performance Period, do one or more of the following:
(i) Withhold payment for services to the APM Entity or the APM
Entity's eligible clinicians;
(ii) Reduce payment rates to the APM Entity or the APM Entity's
eligible clinicians; or
(iii) Require the APM Entity to owe payment(s) to CMS.
(2) Medical Home Model financial risk standard. The APM Entity
participates in a Medical Home Model that, based on the APM Entity's
failure to meet or exceed one or more specified performance standards,
which may include expected expenditures, does one or more of the
following:
(i) Withholds payment for services to the APM Entity or the APM
Entity's eligible clinicians;
(ii) Reduces payment rates to the APM Entity or the APM Entity's
eligible clinicians;
(iii) Requires the APM Entity to owe payment(s) to CMS; or
(iv) Causes the APM Entity to lose the right to all or part of an
otherwise guaranteed payment or payments.
(3) Generally applicable nominal amount standard. (i) Except as
provided in paragraph (c)(4) of this section, the total amount an APM
Entity potentially owes CMS or foregoes under an APM must be at least
equal to either:
(A) For QP Performance Periods beginning in 2017, through 2024, 8
percent of the average estimated total Medicare Parts A and B revenue of
all providers and suppliers in participating APM Entities; or
(B) 3 percent of the expected expenditures for which an APM Entity
is responsible under the APM.
(ii) [Reserved]
(4) Medical Home Model nominal amount standard. (i) For a Medical
Home Model to meet the Medical Home Model nominal amount standard, the
total annual amount that an APM Entity potentially owes CMS or foregoes
must be at least the following amounts:
(A) For QP Performance Period 2017, 2.5 percent of the average
estimated total Medicare Parts A and B revenue of all providers and
suppliers in participating APM Entities.
(B) For QP Performance Period 2018, 2.5 percent of the average
estimated total Medicare Parts A and B revenue of all providers and
suppliers in participating APM Entities.
(C) For QP Performance Period 2019, 3 percent of the average
estimated total Medicare Parts A and B revenue of all providers and
suppliers in participating APM Entities.
(D) For QP Performance Period 2020, 4 percent of the average
estimated total Medicare Parts A and B revenue of all providers and
suppliers in participating APM Entities.
(E) For QP Performance Periods 2021 and later, 5 percent of the
average estimated total Medicare Parts A and B revenue of all providers
and suppliers in participating APM Entities.
(ii) [Reserved]
(5) Expected expenditures. For the purposes of this section,
expected expenditures is defined as the beneficiary expenditures for
which an APM Entity is responsible under an APM. For episode payment
models, expected expenditures mean the episode target price.
(6) Capitation. A full capitation arrangement meets this Advanced
APM criterion. For purposes of this part, a full capitation arrangement
means a payment arrangement in which a per capita or otherwise
predetermined payment is made under the APM for all items and services
furnished to a population of beneficiaries during a fixed period of
time, and no settlement is performed to reconcile or share losses
incurred or savings earned by the APM Entity. Arrangements between CMS
and Medicare Advantage Organizations under the Medicare Advantage
program (42 U.S.C. 422) are not considered capitation arrangements for
purposes of this paragraph (c)(6).
(7) Medical Home Model 50 eligible clinician limit. Notwithstanding
paragraphs (c)(2) and (4) of this section, beginning in the 2018 QP
Performance Period, if
[[Page 194]]
an APM Entity participating in a Medical Home Model other than Round 1
of the Comprehensive Primary Care Plus (CPC+) Model is owned and
operated by an organization with 50 or more eligible clinicians whose
Medicare billing rights have been reassigned to the TIN(s) of the
organization(s) or any of the organization's subsidiary entities, the
requirements of paragraphs (c)(1) and (c)(3) of this section apply.
[81 FR 77537, Nov. 4, 2016, as amended at 82 FR 53960, Nov. 16, 2017; 83
FR 60090, Nov. 23, 2018]
Effective Date Notes: 1. At 83 FR 60090, Nov. 23, 2018, section
414.1415 was amended by revising paragraphs (b)(2) and (3), effective
Jan. 1, 2010. For the convenience of the user, the revised text is set
forth as follows:
Sec. 414.1415 Advanced APM criteria.
* * * * *
(b) * * *
(2) At least one of the quality measures used in the payment
arrangement as specified in paragraph (b)(1) of this section must:
(i) For QP Performance Periods before January 1, 2020, have an
evidence-based focus, be reliable and valid, and meet at least one of
the following criteria:
(A) Used in the MIPS quality performance category, as described in
Sec. 414.1330;
(B) Endorsed by a consensus-based entity;
(C) Developed under section 1848(s) of the Act;
(D) Submitted in response to the MIPS Call for Quality Measures
under section 1848(q)(2)(D)(ii) of the Act; or
(E) Any other quality measures that CMS determines to have an
evidence-based focus and to be reliable and valid; and
(ii) For QP Performance Periods beginning on or after January1,
2020, be:
(A) Finalized on the MIPS final list of measures, as described in
Sec. 414.1330;
(B) Endorsed by a consensus-based entity; or
(C) Determined by CMS to be evidenced-based, reliable, and valid.
(3) In addition to the quality measure described under paragraph
(b)(2) of this section, the quality measures upon which an Advanced APM
bases the payment in paragraph (b)(1) of this section must include at
least one additional measure that is an outcome measure unless CMS
determines that there are no available or applicable outcome measures
included in the MIPS final quality measures list for the Advanced APM's
first QP Performance Period. Beginning January 1, 2020, the included
outcome measure must satisfy the criteria in paragraph (b)(2) of this
section.
* * * * *
2. At 84 FR 540, Jan. 31, 2019, in amendatory instruction 41 on page
60090, in the second column, in line 2, the parenthetical ``(effective
January 1, 2010)'' denoting the effective date of the rule was corrected
to read ``(effective January 1, 2020)''.
Sec. 414.1420 Other payer advanced APM criteria.
(a) Other Payer Advanced APM criteria. A payment arrangement with a
payer other than Medicare is an Other Payer Advanced APM for a QP
Performance Period if CMS determines that the arrangement meets the
following criteria during the QP Performance Period:
(1) Use of CEHRT, as described in paragraph (b) of this section;
(2) Quality measures comparable to measures under the MIPS quality
performance category apply, as described in paragraph (c) of this
section; and
(3) Either:
(i) Requires APM Entities to bear more than nominal financial risk
if actual aggregate expenditures exceed expected aggregate expenditures
as described in paragraph (d) of this section; or
(ii) Is a Medicaid Medical Home Model that meets criteria comparable
to Medical Home Models expanded under section 1115A(c) of the Act as
described in paragraph (d) of this section.
(b) Use of CEHRT. To be an Other Payer Advanced APM, an other payer
arrangement must require participants to use CEHRT as defined in Sec.
414.1305. The other payer arrangement must require at least 50 percent
of eligible clinicians in each participating APM Entity group, or each
hospital if hospitals are the APM Entities, to use CEHRT to document and
communicate clinical care.
(c) Use of quality measures. (1) To be an Other Payer Advanced APM,
a payment arrangement must apply quality measures comparable to measures
under the MIPS quality performance category, as described in paragraph
(c)(2) of this section.
(2) At least one of the quality measures used in the payment
arrangement
[[Page 195]]
must have an evidence-based focus, be reliable and valid, and meet at
least one of the following criteria:
(i) Used in the MIPS quality performance category, as described in
Sec. 414.1330;
(ii) Endorsed by a consensus-based entity;
(iii) Developed under section 1848(s) of the Act;
(iv) Submitted in response to the MIPS Call for Quality Measures
under section 1848(q)(2)(D)(ii) of the Act; or
(v) Any other quality measures that CMS determines to have an
evidence-based focus and to be reliable and valid.
(3) To meet the quality measure use criterion, a payment arrangement
must use an outcome measure if there is an applicable outcome measure on
the MIPS quality measure list.
(d) Financial risk. To be an Other Payer Advanced APM, except as
described in paragraph (d)(7) of this section, a payment arrangement
must meet either the financial risk standard under paragraph (d)(1) or
(2) of this section and the nominal amount standard under paragraph
(d)(3) or (4) of this section, or be a Medicaid Medical Home Model with
criteria comparable to an expanded Medical Home Model under section
1115A(c) of the Act.
(1) Generally applicable financial risk standard. Except for APM
Entities to which paragraph (d)(2) of this section applies, to be an
Other Payer Advanced APM, an APM Entity must, based on whether an APM
Entity's actual expenditures for which the APM Entity is responsible
under the payment arrangement exceed expected expenditures during a
specified period of performance do one or more of the following:
(i) Withhold payment for services to the APM Entity or the APM
Entity's eligible clinicians;
(ii) Reduce payment rates to the APM Entity or the APM Entity's
eligible clinicians; or
(iii) Require direct payment by the APM Entity to the payer.
(2) Medicaid Medical Home Model financial risk standard. The APM
Entity participates in a Medicaid Medical Home Model that, based on the
APM Entity's failure to meet or exceed one or more specified performance
standards, does one or more of the following:
(i) Withhold payment for services to the APM Entity or the APM
Entity's eligible clinicians;
(ii) Require direct payment by the APM Entity to the Medicaid
program;
(iii) Reduce payment rates to the APM Entity or the APM Entity's
eligible clinicians; or
(iv) Require the APM Entity to lose the right to all or part of an
otherwise guaranteed payment or payments.
(3) Generally applicable nominal amount standard. Except for payment
arrangements described in paragraph (d)(2) of this section, the total
amount an APM Entity potentially owes a payer or foregoes under a
payment arrangement must be at least:
(i) For QP Performance Periods 2019 through 2024, 8 percent of the
total combined revenues from the payer to providers and other entities
under the payment arrangement if financial risk is expressly defined in
terms of revenue; or, 3 percent of the expected expenditures for which
an APM Entity is responsible under the payment arrangement.
(ii) Except for risk arrangements described under paragraph (d)(2)
of this section, the risk arrangement must have:
(A) A marginal risk rate of at least 30 percent; and
(B) Total potential risk of at least 4 percent of expected
expenditures.
(4) Medicaid Medical Home Model nominal amount standard. For a
Medicaid Medical Home Model to meet the Medicaid Medical Home Model
nominal amount standard, the total annual amount that an APM Entity
potentially owes a payer or foregoes must be at least the following
amounts:
(i) For QP Performance Period 2019, 3 percent of the average
estimated total revenue of the participating providers or other entities
under the payer.
(ii) For QP Performance Period 2020, 4 percent of the average
estimated total revenue of the participating providers or other entities
under the payer.
[[Page 196]]
(iii) For QP Performance Periods 2021 and later, 5 percent of the
average estimated total revenue of the participating providers or other
entities under the payer.
(5) Marginal risk rate. For purposes of this section, the marginal
risk rate is defined as the percentage of actual expenditures that
exceed expected expenditures for which an APM Entity is responsible
under an APM.
(i) In the event that the marginal risk rate varies depending on the
amount by which actual expenditures exceed expected expenditures, the
lowest marginal risk rate across all possible levels of actual
expenditures would be used for comparison to the marginal risk rate
specified in paragraph (d)(3)(ii)(A) of this section, with exceptions
for large losses as described in paragraph (d)(5)(ii) of this section
and small losses as described in paragraph (d)(5)(iii) of this section.
(ii) Allowance for large losses. The determination in paragraph
(d)(3)(ii)(A) of this section may disregard the marginal risk rates that
apply in cases when actual expenditures exceed expected expenditures by
an amount sufficient to require the APM Entity to make financial risk
payments under the Other Payer Advanced APM greater than or equal to the
total risk requirement under paragraph (d)(3)(i) of this section.
(iii) Allowance for minimum loss rate. The determination in
paragraph (d)(3)(ii)(A) of this section may disregard the marginal risk
rates that apply in cases when actual expenditures exceed expected
expenditures by less than 4 percent of expected expenditures.
(6) Expected expenditures. For the purposes of this section,
expected expenditures is defined as the Other Payer Advanced APM
benchmark, except for episode payment models, for which it is defined as
the episode target price.
(7) Capitation. A full capitation arrangement meets this Other Payer
Advanced APM criterion. For purposes of paragraph (d)(3) of this
section, a full capitation arrangement means a payment arrangement in
which a per capita or otherwise predetermined payment is made under the
payment arrangement for all items and services furnished to a population
of beneficiaries during a fixed period of time, and no settlement is
performed for the purpose of reconciling or sharing losses incurred or
savings earned by the participant. Arrangements made directly between
CMS and Medicare Advantage Organizations under the Medicare Advantage
program (42 U.S.C. 422) are not considered capitation arrangements for
purposes of this paragraph (c)(7).
(8) Medicaid Medical Home Model 50 eligible clinician limit.
Notwithstanding paragraphs (d)(2) and (4) of this section, beginning in
the 2019 QP Performance Period, if an APM Entity participating in a
Medicaid Medical Home Model is owned and operated by an organization
with 50 or more eligible clinicians whose Medicare billing rights have
been reassigned to the TIN(s) of the organization(s) or any of the
organization's subsidiary entities, the requirements of paragraphs
(d)(1) and (3) of this section apply.
[81 FR 77537, Nov. 4, 2016, as amended at 82 FR 53961, Nov. 16, 2017; 83
FR 23610, May 22, 2018; 83 FR 60090, Nov. 23, 2018]
Effective Date Note: At 83 FR 60090, Nov. 23, 2018, section 414.1420
was amended by revising paragraphs (b), (c)(2) and (3), effective Jan.
1, 2020. For the convenience of the user, the revised text is set forth
as follows:
Sec. 414.1420 Other payer advanced APM criteria.
* * * * *
(b) Use of CEHRT. To be an Other Payer Advanced APM, CEHRT must be
used by at least 50 percent, or for QP Performance Periods on or after
January 1, 2020, 75 percent of participants in each participating APM
Entity group, or each hospital if hospitals are the APM Entities, in the
other payer arrangement to document and communicate clinical care.
(c) * * *
(2) At least one of the quality measures used in the payment
arrangement as specified in paragraph (c)(1) of this section must:
(i) For QP Performance Period before January 1, 2020, have an
evidence-based focus, be reliable and valid, and meet at least one of
the following criteria:
(A) Used in the MIPS quality performance category, as described in
Sec. 414.1330;
(B) Endorsed by a consensus-based entity;
(C) Developed under section 1848(s) of the Act;
[[Page 197]]
(D) Submitted in response to the MIPS Call for Quality Measures
under section 1848(q)(2)(D)(ii) of the Act; or
(E) Any other quality measures that CMS determines to have an
evidence-based focus and to be reliable and valid; and
(ii) For QP Performance Periods beginning on or after January 1,
2020, be:
(A) Finalized on the MIPS final list of measures, as described in
Sec. 414.1330;
(B) Endorsed by a consensus-based entity; or
(C) Determined by CMS to be evidenced-based, reliable, and valid.
(3) To meet the quality measure use criterion under paragraph (c)(1)
of this section, a payment arrangement must:
(i) For QP Performance Periods before January 1, 2020, use an
outcome measure if there is an applicable outcome measure on the MIPS
quality measure list. This criterion also applies for payment
arrangements determined to be Other Payer Advanced APMs on or before
January 1, 2020, but only for the Other Payer Advanced APM determination
made with respect to the arrangement for the CY 2020 QP Performance
Period (regardless of whether that determination is a single- or multi-
year determination).
(ii) For QP Performance Periods on or after January 1, 2020, in
addition to the quality measure described under paragraph (c)(2) of this
section, use at least one additional measure that is an outcome measure
and meets the criteria in paragraph (c)(2)(ii) of this section if there
is such an applicable outcome measure on the MIPS quality measure list.
* * * * *
Sec. 414.1425 Qualifying APM participant determination: In general.
(a) List used for QP determination. (1) For Advanced APMs in which
all APM Entities may include eligible clinicians on a Participation
List, the Participation List is used to identify the APM Entity group
for purposes of QP determinations, regardless of whether the APM Entity
may also include eligible clinicians on an Affiliated Practitioner List.
(2) For Advanced APMs in which APM Entities do not include eligible
clinicians on a Participation List but do include eligible clinicians on
an Affiliated Practitioner List, the Affiliated Practitioner List is
used to identify the eligible clinicians for purposes of QP
determinations.
(3) For Advanced APMs in which some APM Entities may include
eligible clinicians on a Participation List and other APM Entities may
only include eligible clinicians on an Affiliated Practitioner List
depending on the type of APM Entity, paragraph (a)(1) of this section
applies to APM Entities that may include eligible clinicians on a
Participation List, and paragraph (a)(2) of this section applies to APM
Entities that may only include eligible clinicians on an Affiliated
Practitioner List.
(b) Group or individual determination under the Medicare Option. (1)
APM Entity group determination. Except for paragraphs (b)(2) and (3) of
this section and as set forth in Sec. 414.1440, for purposes of the QP
determinations for a year, eligible clinicians are grouped and assessed
through their collective participation in an APM Entity group that is in
an Advanced APM. To be included in the APM Entity group for purposes of
the QP determination, an eligible clinician's APM participant identifier
must be present on a Participation List of an APM Entity group on one of
the dates: March 31, June 30, or August 31 of the QP Performance Period.
An eligible clinician included on a Participation List on any one of
these dates is included in the APM Entity group even if that eligible
clinician is not included on that Participation List at one of the prior
or later listed dates. CMS performs QP determinations for the eligible
clinicians in an APM entity group three times during the QP Performance
Period using claims data for services furnished from January 1 through
each of the respective QP determination dates: March 31, June 30, and
August 31. An eligible clinician can only be determined to be a QP if
the eligible clinician appears on the Participation List on a date
(March 31, June 30, or August 31) CMS uses to determine the APM Entity
group and to make QP determinations collectively for the APM Entity
group based on participation in the Advanced APM.
(2) Affiliated practitioner individual determination under the
Medicare Option. For Advanced APMs to which paragraph (a)(2) of this
section applies, QP determinations are made individually for each
eligible clinician. To be assessed as an Affiliated Practitioner, an
eligible clinician must be identified on
[[Page 198]]
an Affiliated Practitioner List on one of the dates: March 31, June 30,
or August 31 of the QP Performance Period. An eligible clinician
included on an Affiliated Practitioner List on any one of these dates is
assessed as an Affiliated Practitioner even if that eligible clinician
is not included on the Affiliated Practitioner List at one of the prior
or later listed dates. For such eligible clinicians, CMS performs QP
determinations during the QP Performance Period using claims data for
services furnished from January 1 through each of the respective QP
determination dates that the eligible clinician is on the Affiliated
Practitioner List: March 31, June 30, and August 31.
(c) QP determination. (1) CMS makes QP determinations as set forth
in Sec. Sec. 414.1435 and 414.1440.
(2) An eligible clinician cannot be both a QP and a Partial QP for a
year. A determination that an eligible clinician is a QP means that the
eligible clinician is not a Partial QP.
(3) An eligible clinician is a QP for a year under the Medicare
Option if the eligible clinician is in an APM Entity group that achieves
a Threshold Score that meets or exceeds the corresponding QP payment
amount threshold or QP patient count threshold for that QP Performance
Period as described in Sec. 414.1430(a)(1) and (3). An eligible
clinician is a QP for the year under the All-Payer Combination Option if
the eligible clinician individually, or as part of an APM Entity group,
achieves a Threshold Score that meets or exceeds the corresponding QP
payment amount threshold or QP patient count threshold for that QP
Performance Period as described in Sec. 414.1430(b)(1) and (3).
(4) Notwithstanding paragraph (c)(3) of this section, an eligible
clinician is a QP for a year if:
(i) The eligible clinician is included in more than one APM Entity
group and none of the APM Entity groups in which the eligible clinician
is included meets the QP payment amount threshold or the QP patient
count threshold, or the eligible clinician is an Affiliated
Practitioner; and
(ii) CMS determines that the eligible clinician individually
achieves a Threshold Score that meets or exceeds the QP payment amount
threshold or the QP patient count threshold.
(5) Notwithstanding paragraph (c)(3) of this section, an eligible
clinician is not a QP for a year if the APM Entity group voluntarily or
involuntarily terminates from an Advanced APM before the end of the QP
Performance Period.
(6) Notwithstanding paragraph (c)(4) of this section, an eligible
clinician is not a QP for a year if one or more of the APM Entities in
which the eligible clinician participates voluntarily or involuntarily
terminates from the Advanced APM before the end of the QP Performance
Period, and the eligible clinician does not individually achieve a
Threshold Score that meets or exceeds the QP payment amount threshold or
QP patient count threshold based on participation in the remaining non-
terminating APM Entities.
(7) Advanced APMs that start or end during the QP Performance
Period:
(i) Notwithstanding paragraph (a) of this section and Sec. Sec.
414.1435 and 414.1440, CMS makes QP determinations and Partial QP
determinations for the APM Entity group or individual eligible clinician
under Sec. 414.1425(b) for Advanced APMs that start or end during the
QP Performance Period and that are actively tested for 60 or more
continuous days during the QP Performance Period using claims data for
services furnished during those dates on which the Advanced APM is
actively tested. For Advanced APMs that start active testing during the
QP Performance Period, CMS performs QP and Partial QP determinations
during the QP Performance Period using claims data for services
furnished from the start of active testing of the Advanced APM through
each of the QP determination dates that occur on or after the Advanced
APM has been actively tested for 60 or more continuous days: March 31,
June 30, and August 31. For Advanced APMs that end active testing during
the QP Performance Period, CMS performs QP and Partial QP determinations
using claims data for services furnished from January 1 or the start of
active testing, whichever occurs later, through the final day of active
testing of the Advanced APM for each of the QP determination dates that
occur on or after the Advanced APM has been actively
[[Page 199]]
tested for 60 or more continuous days during that QP Performance Period:
March 31, June 30, and August 31.
(ii) For QP determinations specified under paragraph (c)(4) of this
section and Partial QP determinations under paragraph (d)(2) of this
section, QP determinations are made using claims data for the full QP
Performance Period even if the eligible clinician participates in one or
more Advanced APMs that start or end during the QP Performance Period.
(d) Partial QP determination. (1) An eligible clinician is a Partial
QP for a year under the Medicare Option if the eligible clinician is in
an APM Entity group that achieves Threshold Score that meets or exceeds
the corresponding Partial QP payment amount threshold or Partial QP
patient count threshold for that QP Performance Period as described in
Sec. 414.1430(a)(2) and (4). An eligible clinician is a Partial QP for
the year under the All-Payer Combination Option if the eligible
clinician achieves individually, or as part of an APM Entity group, a
Threshold Score that meets or exceeds the corresponding Partial QP
payment amount threshold or Partial QP patient count threshold for that
QP Performance Period as described in Sec. 414.1430(b)(2) and (4).
(2) Notwithstanding paragraph (d)(1) of this section, an eligible
clinician is a Partial QP for a year if:
(i) The eligible clinician is included in more than one APM Entity
group and none of the APM Entity groups in which the eligible clinician
is included meets the corresponding QP or Partial QP threshold, or the
eligible clinician is an Affiliated Practitioner; and
(ii) CMS determines that the eligible clinician individually
achieves a Threshold Score that meets or exceeds the corresponding
Partial QP Threshold.
(3) Notwithstanding paragraph (d)(1) of this section, an eligible
clinician is not a Partial QP for a year if the APM Entity group
voluntarily or involuntarily terminates from an Advanced APM before the
end of the QP Performance Period.
(4) Notwithstanding paragraph (d)(2) of this section, an eligible
clinician is not a Partial QP for a year if one or more of the APM
Entities in which the eligible clinician participates voluntarily or
involuntarily terminates from the Advanced APM before the end of the QP
Performance Period, and the eligible clinician does not individually
achieve a Threshold Score that meets or exceeds the Partial QP payment
amount threshold or Partial QP patient count threshold based on
participation in the remaining non-terminating APM Entities.
(e) Notification of QP determination. CMS notifies eligible
clinicians determined to be QPs or Partial QPs for a year as soon as
practicable following each QP determination date in the QP Performance
Period.
(f) Order of threshold options. (1) For payment years 2019 and 2020,
CMS performs QP determinations for an eligible clinicians only under the
Medicare Option described in Sec. 414.1435.
(2) For payment years 2021 and later, CMS performs QP determinations
for eligible clinicians under the Medicare Option, as described in Sec.
414.1435 and, except as specified in paragraphs (d)(2)(i) and (ii) of
this section, the All-Payer Combination Option, described in Sec.
414.1440.
(i) If CMS determines the eligible clinician to be a QP under the
Medicare Option, then CMS does not calculate a Threshold Score for such
eligible clinician under the All-Payer Combination Option.
(ii) If the Threshold Score for an eligible clinician under the
Medicare Option is less than the amount specified in Sec.
414.1430(b)(2)(ii) and (b)(3)(iii), then CMS does not perform a QP
determination for such eligible clinician(s) under the All-Payer
Combination Option.
[81 FR 77537, Nov. 4, 2016, as amended at 82 FR 53961, Nov. 16, 2017]
Sec. 414.1430 Qualifying APM participant determination:
QP and partial QP thresholds.
(a) Medicare Option--(1) QP payment amount threshold. The QP payment
amount thresholds are the following values for the indicated payment
years:
(i) 2019 and 2020: 25 percent.
(ii) 2021 and 2022: 50 percent.
(iii) 2023 and later: 75 percent.
(2) Partial QP payment amount threshold. The Partial QP payment
amount
[[Page 200]]
thresholds are the following values for the indicated payment years:
(i) 2019 and 2020: 20 percent.
(ii) 2021 and 2022: 40 percent.
(ii) 2023 and later: 50 percent.
(3) QP patient count threshold. The QP patient count thresholds are
the following values for the indicated payment years:
(i) 2019 and 2020: 20 percent
(ii) 2021 and 2022: 35 percent
(ii) 2023 and later: 50 percent
(4) Partial QP patient count threshold. The Partial QP patient count
thresholds are the following values for the indicated payment years:
(i) 2019 and 2020: 10 percent
(ii) 2021 and 2022: 25 percent
(iii) 2023 and later: 35 percent
(b) All-Payer Combination Option--(1) QP payment amount threshold.
(i) The QP payment amount thresholds are the following values for
the indicated payment years:
(A) 2021 and 2022: 50 percent.
(B) 2023 and later: 75 percent.
(ii) To meet the QP payment amount threshold under this option, the
eligible clinician must also meet a 25 percent QP payment amount
threshold under the Medicare Option.
(2) Partial QP payment amount threshold. (i) The Partial QP payment
amount thresholds are the following values for the indicated payment
years:
(A) 2021 and 2022: 40 percent.
(B) 2023 and later: 50 percent.
(ii) To meet the QP payment amount threshold under this option, the
eligible clinician must also meet a 20 percent Partial QP payment amount
threshold under the Medicare Option.
(3) QP patient count threshold. (i) The QP patient count thresholds
are the following values for the indicated payment years:
(A) 2021 and 2022: 35 percent.
(B) 2023 and later: 50 percent.
(ii) To meet the QP patient count threshold under this option, the
eligible clinician must also meet a 20 percent QP patient count
threshold under the Medicare Option.
(4) Partial QP patient count threshold. (i) The Partial QP patient
count thresholds are the following values for the indicated payment
years:
(A) 2021 and 2022: 25 percent.
(B) 2023 and later: 35 percent.
(ii) To meet the Partial QP patient count threshold under this
option, the eligible clinician group or eligible clinician must also
meet a 10 percent QP patient count threshold under the Medicare Option.
Sec. 414.1435 Qualifying APM participant determination: Medicare option.
(a) Payment amount method. The Threshold Score for an APM Entity or
eligible clinician is calculated as a percent by dividing the value
described under paragraph (a)(1) of this section by the value described
under paragraph (a)(2) of this section.
(1) Numerator. The aggregate of payments for Medicare Part B covered
professional services furnished by the APM Entity group to attributed
beneficiaries during the QP Performance Period.
(2) Denominator. The aggregate of payments for Medicare Part B
covered professional services furnished by the APM Entity group to all
attribution-eligible beneficiaries during the QP Performance Period.
(3) Claims and adjustments. In the calculations under paragraphs
(a)(1) and (2) of this section, CMS compiles claims and treats claims
adjustments, supplemental service payments, and alternative payment
methods in the same manner as described in Sec. 414.1450.
(b) Patient count method. The Threshold Score for each eligible
clinician in an APM Entity group is calculated as a percent under the
patient count method by dividing the value described under paragraph
(b)(1) of this section by the value described under paragraph (b)(2) of
this section.
(1) Numerator. The number of attributed beneficiaries to whom the
APM Entity group furnishes Medicare Part B covered professional services
or services by a Rural Health Clinic (RHC) or Federally-Qualified Health
Center (FQHC) during the QP Performance Period.
(2) Denominator. The number of attribution-eligible beneficiaries to
whom the APM Entity group or eligible clinician furnish Medicare Part B
covered professional services or services by a Rural Health Clinic (RHC)
or Federally-Qualified Health Center (FQHC) during the QP Performance
Period.
[[Page 201]]
(3) Unique beneficiaries. For each APM Entity group, a unique
Medicare beneficiary is counted no more than one time for the numerator
and no more than one time for the denominator.
(4) Beneficiaries count multiple times. Based on attribution under
the terms of an Advanced APM, a single Medicare beneficiary may be
counted in the numerator or denominator for multiple different APM
Entity groups.
(c) Attribution. (1) Attributed beneficiaries are determined from
Advanced APM attributed beneficiary lists generated by each Advanced
APM's specific attribution methodology.
(2) When operationally feasible, this attributed beneficiary list
will be the final beneficiary list used for reconciliation purposes in
the Advanced APM.
(3) When it is not operationally feasible to use the final
attributed beneficiary list, the attributed beneficiary list will be
taken from the Advanced APM's most recently available attributed
beneficiary list at the end of the QP Performance Period.
(d) Use of methods. CMS calculates Threshold Scores for an APM
Entity or eligible clinician as provided by Sec. 414.1425(b) under both
the payment amount and patient count methods for each QP Performance
Period. CMS then assigns to the eligible clinicians included in the APM
Entity group or to the eligible clinician the score that results in the
greater QP status. QP status is greater than Partial QP status, and
Partial QP status is greater than no QP status.
[81 FR 77537, Nov. 4, 2016, as amended at 82 FR 53963, Nov. 16, 2017]
Sec. 414.1440 Qualifying APM participant determination:
All-payer combination option.
(a) Payments excluded from calculations. (1) These calculations
include a combination of both Medicare payments for Part B covered
professional services and all other payments for all other payers,
except for payments made by:
(i) The Secretary of Defense for the costs of Department of Defense
health care programs;
(ii) The Secretary of Veterans Affairs for the cost of Department of
Veterans Affairs health care programs; and
(iii) Under Title XIX in a State in which no Medicaid APM or
Medicaid Medical Home Model that is an Other Payer Advanced APM is
available.
(2) Payments and associated patient counts under paragraph
(a)(1)(iii) of this section are included in the numerator and
denominator as specified in paragraphs (b)(2) and (3) and paragraphs
(c)(2) and (3) of this section for an eligible clinician if CMS
determines that there is at least one Medicaid APM or Medicaid Medical
Home Model that is an Other Payer Advanced APM available in the county
where the eligible clinician sees the most patients during the QP
Performance Period, and that the eligible clinician is not ineligible to
participate in the Other Payer Advanced APM based on their specialty.
(b) Payment amount method--(1) In general. The Threshold Score for
either an APM Entity group or eligible clinician will be calculated by
dividing the value described under the numerator by the value described
under the denominator as specified in paragraphs (b)(2) and (3) of this
section.
(2) Numerator. The aggregate amount of all payments from all payers,
except those excluded under paragraph (a) of this section, attributable
to the eligible clinician or to the APM Entity group under the terms of
all Advanced APMs and Other Payer Advanced APMs during the QP
Performance Period.
(3) Denominator. The aggregate amount of all payments from all
payers, except those excluded under paragraph (a) of this section, made
to the eligible clinician or to the APM Entity group during the QP
Performance Period.
(c) Patient count method--(1) In general. The Threshold Score for
either an APM Entity group or eligible clinician is calculated by
dividing the value described under the numerator by the value described
under the denominator as specified in paragraphs (c)(2) and (3) of this
section.
(2) Numerator. The number of unique patients to whom an APM Entity
group or eligible clinician furnishes services that are included in the
measures of aggregate expenditures used under the terms of all Advanced
APMs and Other
[[Page 202]]
Payer Advanced APMs during the QP Performance Period.
(3) Denominator. The number of unique patients to whom the APM
Entity group or eligible clinician furnishes services under all non-
excluded payers during the QP Performance Period.
(4) Unique patients. CMS may count a single patient in the numerator
and/or denominator for multiple different payers.
(d) QP Determinations under the All-Payer Combination Option. (1)
CMS performs QP determinations following the QP Performance Period using
payment amount and/or patient count information submitted from January 1
through each of the respective QP determination dates: March 31, June
30, and August 31. CMS will use data for the same time periods for the
Medicare and other payer portions of Threshold Score calculations under
the All-Payer Combination Option. CMS will use the payment amount or
patient count method, applying the more advantageous of the two for both
the Medicare and other payer portions of the Threshold score
calculation, regardless of the method used for the Medicare Threshold
Score calculation.
(2) An APM Entity may request that CMS make QP determinations at the
APM Entity level, an eligible clinician may request that CMS make QP
determinations at the eligible clinician level, and an eligible
clinician or an APM Entity may request that CMS makes QP determinations
at the TIN-level in instances where all clinicians who reassigned
billing rights to the TIN are participating in a single APM Entity. CMS
makes QP determinations at either the APM Entity, eligible clinician, or
TIN level. Eligible clinicians assessed at the eligible clinician level
under the Medicare Option at Sec. 414.1425(b)(2) will be assessed at
the eligible clinician level only under the All-Payer Combination
Option. Eligible Clinicians may meet the Medicare and the All-Payer
Combination Option thresholds using the payment amount method for both
thresholds, the patient account method for both thresholds, or the
payment amount method for one threshold and the patient account method
for the other threshold.
(3) CMS uses data at the same level for the Medicare and other payer
portions of Threshold Score calculations under the All-Payer Combination
Option. When QP determinations are made at the eligible clinician or, at
the TIN level when all clinicians who have reassigned billing rights to
the TIN are included in a single APM Entity; and if the Medicare
Threshold score for the APM Entity group is higher than when calculated
for the eligible clinician or TIN, CMS makes QP determinations using a
weighted Medicare Threshold Score that is factored into an All-Payer
Combination Option Threshold Score.
(e) Information used to calculate Threshold Scores under the All-
Payer Combination Option. (1) An APM Entity or eligible clinician may
request as set forth in Sec. 414.1445(b)(2) that CMS determine whether
a payment arrangement in which they participate meets the Other Payer
Advanced APM criteria and may demonstrate participation in an Other
Payer Advanced APM determined as a result of a request made in Sec.
414.1445(a)(1) or (b)(1) in a form and manner specified by CMS.
(2) To request a QP determination under the All-Payer Combination
Option, for each payment arrangement submitted as set forth in paragraph
(e)(1) of this section, the APM Entity or eligible clinician must
include the amount of revenue for services furnished through the payment
arrangement, the total revenue received from all payers except those
excluded as provided in paragraph (a)(2) of this section, the number of
patients furnished any service through the arrangement, and the total
number of patients furnished any services, except those excluded as
provided in paragraph (a)(2) of this section.
(3) An APM Entity or eligible clinician must submit the information
specified in paragraph (e)(2) of this section in a form and manner
specified by CMS. An APM Entity or eligible clinician may submit the
information specified in paragraph (e)(2) of this section for the
following periods of time in the relevant QP Performance Period: January
1 through March 31, January 1 through June 30, and January 1 through
August 31.
[[Page 203]]
(4) To request a QP determination under the All-Payer Combination
Option, an APM Entity or eligible clinician must submit this information
to CMS no later than the QP Determination Submission Deadline, which is
December 1 of the calendar year that is 2 years prior to the payment
year.
(f) Requirement to submit sufficient information--(1) Sufficient
Information. CMS makes a QP determination with respect to the eligible
clinician under the All-Payer Combination Option only if the APM Entity
or eligible clinician submits the information required under paragraph
(e) of this section sufficient for CMS to assess the eligible clinician
under either the payment amount or patient count as described in
paragraphs (b) and (c) of this section.
(2) Certification. The APM Entity or eligible clinician who submits
information to request a QP determination under the All-Payer
Combination Option must certify that the information submitted to CMS is
true, accurate, and complete. Such certification must accompany the
submission and be made at the time of submission. In the case of
information submitted by an APM Entity, the certification must be made
by an individual with the authority to bind the APM Entity.
(g) Notification of QP determination. CMS notifies eligible
clinicians determined to be QPs or Partial QPs for a year as soon as
practicable after QP calculations are conducted.
[81 FR 77537, Nov. 4, 2016, as amended at 82 FR 53963, Nov. 16, 2017; 83
FR 60091, Nov. 23, 2018]
Sec. 414.1445 Determination of other payer advanced APMs.
(a) Determination of Medicaid APMs. Beginning in 2018, and each year
thereafter, at a time determined by CMS, a state, APM Entity, or
eligible clinician may request, in a form and manner specified by CMS,
that CMS determine whether a payment arrangement authorized under Title
XIX is either a Medicaid APM or a Medicaid Medical Home Model that meets
the Other Payer Advanced APM criteria as set forth in Sec. 414.1420. A
state must submit its request by April 1 of the year prior to the
relevant QP Performance Period, and an APM Entity or eligible clinician
must submit its request by November 1 of the year prior to the relevant
QP Performance Period. CMS will not determine that a payment arrangement
is a Medicaid APM or Medicaid Medical Home Model that meets the Other
Payer Advanced APM criteria as set forth in Sec. 414.1420 for a year
after the relevant QP Performance Period.
(b) Determination of Other Payer Advanced APMs--(1) Payer initiated
Other Payer Advanced APM determination process. Beginning in 2018, and
each year thereafter, at a time determined by CMS a payer with a
Medicare Health Plan payment arrangement may request, in a form and
manner specified by CMS, that CMS determine whether a Medicare Health
Plan payment arrangement meets the Other Payer Advanced APM criteria set
forth in Sec. 414.1420. A payer with a Medicare Health Plan payment
arrangement must submit its requests by the annual Medicare Advantage
bid deadline of the year prior to the relevant QP Performance Period. A
Medicare Health Plan is a Medicare Advantage plan, a section 1876 cost
plan, a PACE organization operated under section 1894, and any similar
plan which provides Medicare benefits under demonstration or waiver
authority (other than an APM as defined in section 1833(z)(3)(C) of the
Act).
(2) Eligible clinician initiated Other Payer Advanced APM
determination process. Except as provided by paragraph (a) of this
section, at a time specified by CMS, an APM Entity or eligible clinician
may request that CMS determine whether a payment arrangement meets the
Other Payer Advanced APM criteria as set forth in Sec. 414.1420 in a
form and manner specified by CMS. An APM Entity or eligible clinician
must submit requests by December 1 of the calendar year of the relevant
QP Performance Period.
(c) Information required for Other Payer Advanced APM
determinations. (1) In order to make an Other Payer Advanced APM
determination as set forth in paragraphs (a) and (b) of this section, a
payer, APM Entity, or eligible clinician must submit the information
specified by CMS in a form and manner
[[Page 204]]
specified by CMS. If a payer, APM Entity, or eligible clinician fails to
submit the information required, CMS will not make a determination as to
whether a payment arrangement meets the Other Payer Advanced APM
criteria as set forth in Sec. 414.1420.
(2) If an eligible clinician submits information showing that a
payment arrangement requires that the eligible clinician must use CEHRT
as defined in Sec. 414.1305 to document and communicate clinical care,
CMS will presume that the CEHRT criterion in Sec. 414.1420(b) is
satisfied for that payment arrangement.
(i) Based on the submission by an eligible clinician or payer of
evidence that CMS determines sufficiently demonstrates that CEHRT is
used as specified in Sec. 414.1420(b) by participants in the payment
arrangement, CMS will consider the CEHRT criterion in Sec. 414.1420(b)
is satisfied for that payment arrangement.
(ii) [Reserved]
(3) If a payment arrangement has no outcome measure, the payer, APM
Entity, or eligible clinician requesting a determination of whether a
payment arrangement meets the Other Payer Advanced APM criteria must
certify that there is no available or applicable outcome measure on the
MIPS measure list.
(d) Certification. A payer, APM Entity, or eligible clinician that
submits information pursuant to paragraph (c) of this section must
certify that the information it submitted to CMS is true, accurate, and
complete. Such certification must accompany the submission and be made
at the time of submission. In the case of information submitted by a
payer or an APM Entity, the certification must be made by an individual
with the authority to bind the payer or the APM Entity.
(e) Timing of Other Payer Advanced APM determinations. CMS makes
Other Payer Advanced APM determinations prior to making QP
determinations under Sec. 414.1440.
(f) Notification of Other Payer Advanced APM determinations. CMS
makes Other Payer Advanced APM determinations and notifies the
requesting payer, APM Entity, or eligible clinician of such
determinations as soon as practicable following the relevant submission
deadline.
[82 FR 53964, Nov. 16, 2017, as amended at 83 FR 60091, Nov. 23, 2018]
Sec. 414.1450 APM incentive payment.
(a) In general. (1) CMS makes a lump sum payment to QPs in the
amount described in paragraph (b) of this section in the manner
described in paragraphs (d) and (e) of this section.
(2) CMS provides notice of the amount of the APM Incentive Payment
to QPs as soon as practicable following the calculation and validation
of the APM Incentive Payment amount, but in any event no later than 1
year after the incentive payment base period.
(b) APM Incentive Payment amount. (1) The amount of the APM
Incentive Payment is equal to 5 percent of the estimated aggregate
payments for covered professional services as defined in section
1848(k)(3)(A) of the Act furnished during the calendar year immediately
preceding the payment year.
(2) The estimated aggregate payment amount for covered professional
services includes all such payments to any and all of the TIN/NPI
combinations associated with the NPI of the QP.
(3) In calculating the estimated aggregate payment amount for a QP,
CMS uses claims submitted with dates of service from January 1 through
December 31 of the incentive payment base period, and processing dates
of January 1 of the base period through March 31 of the subsequent
payment year.
(4) The payment adjustment amounts, negative or positive, as
described in sections 1848(m), (o), (p), and (q) of the Act are not
included in calculating the APM Incentive Payment amount.
(5) Incentive payments made to eligible clinicians under sections
1833(m), (x), and (y) of the Act are not included in calculating the APM
Incentive Payment amount.
(6) Financial risk payments such as shared savings payments or net
reconciliation payments are excluded from the amount of covered
professional services in calculating the APM Incentive Payment amount.
(7) Supplemental service payments in the amount of covered
professional
[[Page 205]]
services are included in calculating the APM Incentive Payment amount
according to this paragraph (b). Supplemental service payments are
included in the amount of covered professional services when calculating
the APM Incentive Payment amount when the supplemental service payment
meets the following four criteria:
(i) Is payment for services that constitute physicians services
authorized under section 1832(a) and defined under section 1861(s) of
the Act.
(ii) Is made for only Part B services under the criterion in
paragraph (b)(9)(i) of this section.
(iii) Is directly attributable to services furnished to an
individual beneficiary.
(iv) Is directly attributable to an eligible clinician, including an
eligible clinician that is a group of individual eligible clinicians.
(8) For payment amounts that are affected by a cash flow mechanism,
the payment amounts that would have occurred if the cash flow mechanism
were not in place are used in calculating the APM Incentive Payment
amount.
(c) APM Incentive Payment recipient. (1) CMS pays the entire APM
Incentive Payment amount to the TIN associated with the QP's
participation in the Advanced APM entity that met the applicable QP
threshold during the QP Performance Period.
(2) In the event that an eligible clinician is no longer affiliated
with the TIN associated with the QP's participation in the Advanced APM
Entity that met the applicable QP threshold during the QP Performance
Period at the time of the APM Incentive Payment distribution, CMS makes
the APM Incentive Payment to the TIN listed on the eligible clinician's
CMS-588 EFT Application form on the date that the APM Incentive Payment
is distributed.
(3) In the event that an eligible clinician becomes a QP through
participation in multiple Advanced APMs, CMS divides the APM Incentive
Payment amount between the TINs associated with the QP's participation
in each Advanced APM during the QP Performance Period. Such payments
will be divided in proportion to the amount of payments associated with
each TIN that the eligible clinician received for covered professional
services during the QP Performance Period.
(d) Timing of the APM Incentive Payment. APM Incentive Payments made
under this section are made as soon as practicable following the
calculation and validation of the APM Incentive Payment amount, but in
any event no later than 1 year after the incentive payment base period.
(e) Treatment of APM Incentive Payment amount in APMs. (1) APM
Incentive Payments made under this section are not included in
determining actual expenditures under an APM.
(2) APM Incentive Payments made under this section are not included
in calculations for the purposes of rebasing benchmarks in an APM.
(f) Treatment of APM Incentive Payment for other Medicare incentive
payments and payment adjustments. APM Incentive Payments made under this
section will not be included in determining the amount of incentive
payment made to eligible clinicians under section 1833(m), (x), and (y)
of the Act.
Sec. 414.1455 Limitation on review.
There is no administrative or judicial review under sections 1869,
1878, or otherwise, of the Act of the following:
(a) The determination that an eligible clinician is a QP or Partial
QP under Sec. 414.1425 and the determination that an APM Entity is an
Advanced APM Entity under Sec. 414.1410.
(b) The determination of the amount of the APM Incentive Payment
under Sec. 414.1450, including any estimation as part of such
determination.
Sec. 414.1460 Monitoring and program integrity.
(a) Vetting eligible clinicians. Prior to payment of the APM
Incentive Payment, CMS determines if eligible clinicians were in
compliance with all Medicare conditions of participation and the terms
of the relevant Advanced APMs in which they participated during the QP
Performance Period. A determination under this provision is not binding
for other purposes.
(b) Rescinding QP Determinations. CMS may rescind a QP determination
if:
[[Page 206]]
(1) Any of the information CMS relied on in making the QP
determination was inaccurate or misleading.
(2) The QP is terminated from an Advanced APM or Other Payer
Advanced APM during the QP Performance Period or Incentive Payment Base
Period; or
(3) The QP is found to be in violation of the terms of the relevant
Advanced APM or any relevant Federal, State, or tribal statute or
regulation during the QP Performance Period or Incentive Payment Base
Period.
(c) Information submitted for All-Payer Combination Option.
Information submitted by payers, APM Entities, or eligible clinicians
for purposes of the All-Payer Combination Option may be subject to audit
by CMS.
(d) Reducing, denying, and recouping of APM Incentive Payments. (1)
CMS may reduce or deny an APM Incentive Payment to an eligible
clinician.
(i) Who CMS determines is not in compliance with all Medicare
conditions of participation and the terms of the relevant Advanced APM
in which they participate during the QP Performance Period or Incentive
Payment Base Period;
(ii) Who is terminated by an APM or Advanced APM during the QP
Performance Period or Incentive Payment Base Period; or
(iii) Whose APM Entity is terminated by an APM or Advanced APM for
non-compliance with any Medicare condition of participation or the terms
of the relevant Advanced APM in which they participate during the QP
Performance Period or Incentive Payment Base Period.
(2) CMS may reopen, revise, and recoup an APM Incentive Payment that
was made in error in accordance with procedures similar to those set
forth at Sec. Sec. 405.980 through Sec. 405.986 and Sec. Sec. 405.370
through 405.379 of this chapter or as established under the relevant
APM.
(e) Maintenance of records. (1) A payer that submits information to
CMS under Sec. 414.1445 for assessment under the All-Payer Combination
Option must maintain such books, contracts, records, documents, and
other evidence as necessary to enable the audit of an Other Payer
Advanced APM determination. Such information and supporting
documentation must be maintained for a period of 6 years after
submission.
(2) An APM Entity or eligible clinician that submits information to
CMS under Sec. 414.1445 for assessment under the All-Payer Combination
Option or Sec. 414.1440 for QP determinations must maintain such books,
contracts, records, documents, and other evidence as necessary to enable
the audit of an Other Payer Advanced APM determination, QP
determinations, and the accuracy of APM Incentive Payments for a period
of 6 years from the end of the QP Performance Period or from the date of
completion of any audit, evaluation, or inspection, whichever is later.
(3) A payer, APM Entity or eligible clinician that submits
information to CMS under Sec. Sec. 414.1440 or 414.1445 must provide
such information and supporting documentation to CMS upon request.
(f) OIG authority. None of the provisions of this part limit or
restrict OIG's authority to audit, evaluate, investigate, or inspect the
Advanced APM Entity, its eligible clinicians, and other individuals or
entities performing functions or services related to its APM activities.
[81 FR 77537, Nov. 4, 2016, as amended at 82 FR 53965, Nov. 16, 2017]
Sec. 414.1465 Physician-focused payment models.
(a) Definition. A physician-focused payment model (PFPM) is an
Alternative Payment Model:
(1) In which Medicare is a payer;
(2) In which eligible clinicians that are eligible professionals as
defined in section 1848(k)(3)(B) of the Act are participants and play a
core role in implementing the APM's payment methodology; and
(3) Which targets the quality and costs of services that eligible
professionals participating in the Alternative Payment Model provide,
order, or can significantly influence.
(b) Criteria. In carrying out its review of physician-focused
payment model proposals, the PTAC must assess
[[Page 207]]
whether the physician-focused payment model meets the following criteria
for PFPMs sought by the Secretary. The Secretary seeks PFPMs that:
(1) Incentives: Pay for higher-value care. (i) Value over volume:
provide incentives to practitioners to deliver high-quality health care.
(ii) Flexibility: provide the flexibility needed for practitioners
to deliver high-quality health care.
(iii) Quality and Cost: are anticipated to improve health care
quality at no additional cost, maintain health care quality while
decreasing cost, or both improve health care quality and decrease cost.
(iv) Payment methodology: pay APM Entities with a payment
methodology designed to achieve the goals of the PFPM Criteria.
Addresses in detail through this methodology how Medicare, and other
payers if applicable, pay APM Entities, how the payment methodology
differs from current payment methodologies, and why the PFPM cannot be
tested under current payment methodologies.
(v) Scope: aim to broaden or expand the CMS APM portfolio by
addressing an issue in payment policy in a new way or including APM
Entities whose opportunities to participate in APMs have been limited.
(vi) Ability to be evaluated: have evaluable goals for quality of
care, cost, and any other goals of the PFPM.
(2) Care delivery improvements: Promote better care coordination,
protect patient safety, and encourage patient engagement. (i)
Integration and Care Coordination: encourage greater integration and
care coordination among practitioners and across settings where multiple
practitioners or settings are relevant to delivering care to the
population treated under the PFPM.
(ii) Patient Choice: encourage greater attention to the health of
the population served while also supporting the unique needs and
preferences of individual patients.
(iii) Patient Safety: aim to maintain or improve standards of
patient safety.
(3) Information Enhancements: Improving the availability of
information to guide decision-making. (i) Health Information Technology:
encourage use of health information technology to inform care.
(ii) [Reserved]
PART 415_SERVICES FURNISHED BY PHYSICIANS IN PROVIDERS,
SUPERVISING PHYSICIANS IN TEACHING SETTINGS, AND RESIDENTS
IN CERTAIN SETTINGS--Table of Contents
Subpart A_General Provisions
Sec.
415.1 Basis and scope.
Subpart B_Fiscal Intermediary Payments to Providers for Physician
Services
415.50 Scope.
415.55 General payment rules.
415.60 Allocation of physician compensation costs.
415.70 Limits on compensation for physician services in providers.
Subpart C_Part B Carrier Payments for Physician Services to
Beneficiaries in Providers
415.100 Scope.
415.102 Conditions for fee schedule payment for physician services to
beneficiaries in providers.
415.105 Amounts of payment for physician services to beneficiaries in
providers.
415.110 Conditions for payment: Medically directed anesthesia services.
415.120 Conditions for payment: Radiology services.
415.130 Conditions for payment: Physician pathology services.
Subpart D_Physician Services in Teaching Settings
415.150 Scope.
415.152 Definitions.
415.160 Election of reasonable cost payment for direct medical and
surgical services of physicians in teaching hospitals: General
provisions.
415.162 Determining payment for physician services furnished to
beneficiaries in teaching hospitals.
415.164 Payment to a fund.
415.170 Conditions for payment on a fee schedule basis for physician
services in a teaching setting.
415.172 Physician fee schedule payment for services of teaching
physicians.
415.174 Exception: Evaluation and management services furnished in
certain centers.
415.176 Renal dialysis services.
415.178 Anesthesia services.
[[Page 208]]
415.180 Teaching setting requirements for the interpretation of
diagnostic radiology and other diagnostic tests.
415.184 Psychiatric services.
415.190 Conditions of payment: Assistants at surgery in teaching
hospitals.
Subpart E_Services of Residents
415.200 Services of residents in approved GME programs.
415.202 Services of residents not in approved GME programs.
415.204 Services of residents in skilled nursing facilities and home
health agencies.
415.206 Services of residents in nonprovider settings.
415.208 Services of moonlighting residents.
Authority: 42 U.S.C. 1302 and 1395hh.
Source: 60 FR 63178, Dec. 8, 1995, unless otherwise noted.
Subpart A_General Provisions
Sec. 415.1 Basis and scope.
(a) Basis. This part is based on the provisions of the following
sections of the Act: Section 1848 establishes a fee schedule for payment
for physician services. Section 1861(q) specifies what is included in
the term ``physician services'' covered under Medicare. Section
1862(a)(14) sets forth the exclusion of nonphysician services furnished
to hospital patients under Part B of Medicare. Section 1886(d)(5)(B)
provides for a payment adjustment under the prospective payment system
for the operating costs of inpatient hospital services furnished to
Medicare beneficiaries in cost reporting periods beginning on or after
October 1, 1983, to account for the indirect costs of medical education.
Section 1886(h) establishes the methodology for Medicare payment of the
cost of direct GME activities.
(b) Scope. This part sets forth rules for fiscal intermediary
payments to providers for physician services, Part B carrier payments
for physician services to beneficiaries in providers, physician services
in teaching settings, and services of residents.
Subpart B_Fiscal Intermediary Payments to Providers for Physician
Services
Sec. 415.50 Scope.
This subpart sets forth rules for payment by fiscal intermediaries
to providers for services furnished by physicians. Payment for covered
services is made either under the prospective payment system (PPS) to
PPS-participating providers in accordance with part 412 of this chapter
or under the reasonable cost method to non-PPS participating providers
in accordance with part 413 of this chapter.
Sec. 415.55 General payment rules.
(a) Allowable costs. Except as specified otherwise in Sec. Sec.
413.102 of this chapter (concerning compensation of owners), 415.60
(concerning allocation of physician compensation costs), and 415.162
(concerning payment for physician services furnished to beneficiaries in
teaching hospitals), costs a provider incurs for services of physicians
are allowable only if the following conditions are met:
(1) The services do not meet the conditions in Sec. 415.102(a)
regarding fee schedule payment for services of physicians to a
beneficiary in a provider.
(2) The services include a surgeon's supervision of services of a
qualified anesthetist, but do not include physician availability
services, except for reasonable availability services furnished for
emergency rooms and the services of standby surgical team physicians.
(3) The provider has incurred a cost for salary or other
compensation it furnished the physician for the services.
(4) The costs incurred by the provider for the services meet the
requirements in Sec. 413.9 of this chapter regarding costs related to
patient care.
(5) The costs do not include supervision of interns and residents
unless the provider elects reasonable cost payment as specified in Sec.
415.160, or any other costs incurred in connection with an approved GME
program that are payable under Sec. Sec. 413.75 through 413.83 of this
chapter.
(b) Allocation of allowable costs. The provider must follow the
rules in
[[Page 209]]
Sec. 415.60 regarding allocation of physician compensation costs to
determine its costs of services.
(c) Limits on allowable costs. The intermediary must apply the
limits on compensation set forth in Sec. 415.70 to determine its
payments to a provider for the costs of services.
[60 FR 63178, Dec. 8, 1995, as amended at 70 FR 47490, Aug. 12, 2005]
Sec. 415.60 Allocation of physician compensation costs.
(a) Definition. For purposes of this subpart, physician compensation
costs means monetary payments, fringe benefits, deferred compensation,
and any other items of value (excluding office space or billing and
collection services) that a provider or other organization furnishes a
physician in return for the physician services. Other organizations are
entities related to the provider within the meaning of Sec. 413.17 of
this chapter or entities that furnish services for the provider under
arrangements within the meaning of the Act.
(b) General rule. Except as provided in paragraph (d) of this
section, each provider that incurs physician compensation costs must
allocate those costs, in proportion to the percentage of total time that
is spent in furnishing each category of services, among--
(1) Physician services to the provider (as described in Sec.
415.55);
(2) Physician services to patients (as described in Sec. 415.102);
and
(3) Activities of the physician, such as funded research, that are
not paid under either Part A or Part B of Medicare.
(c) Allowable physician compensation costs. Only costs allocated to
payable physician services to the provider (as described in Sec.
415.55) are allowable costs to the provider under this subpart.
(d) Allocation of all compensation to services to the provider.
Generally, the total physician compensation received by a physician is
allocated among all services furnished by the physician, unless--
(1) The provider certifies that the compensation is attributable
solely to the physician services furnished to the provider; and
(2) The physician bills all patients for the physician services he
or she furnishes to them and personally receives the payment from or on
behalf of the patients. If returned directly or indirectly to the
provider or an organization related to the provider within the meaning
of Sec. 413.17 of this chapter, these payments are not compensation for
physician services furnished to the provider.
(e) Assumed allocation of all compensation to beneficiary services.
If the provider and physician agree to accept the assumed allocation of
all the physician services to direct services to beneficiaries as
described under Sec. 415.102(a), CMS does not require a written
allocation agreement between the physician and the provider.
(f) Determination and payment of allowable physician compensation
costs. (1) Except as provided under paragraph (e) of this section, the
intermediary pays the provider for these costs only if--
(i) The provider submits to the intermediary a written allocation
agreement between the provider and the physician that specifies the
respective amounts of time the physician spends in furnishing physician
services to the provider, physician services to patients, and services
that are not payable under either Part A or Part B of Medicare; and
(ii) The compensation is reasonable in terms of the time devoted to
these services.
(2) In the absence of a written allocation agreement, the
intermediary assumes, for purposes of determining reasonable costs of
the provider, that 100 percent of the physician compensation cost is
allocated to services to beneficiaries as specified in paragraph (b)(2)
of this section.
(g) Recordkeeping requirements. Except for services furnished in
accordance with the assumed allocation under paragraph (e) of this
section, each provider that claims payment for services of physicians
under this subpart must meet all of the following requirements:
(1) Maintain the time records or other information it used to
allocate physician compensation in a form that permits the information
to be validated by the intermediary or the carrier.
(2) Report the information on which the physician compensation
allocation
[[Page 210]]
is based to the intermediary or the carrier on an annual basis and
promptly notify the intermediary or carrier of any revisions to the
compensation allocation.
(3) Retain each physician compensation allocation, and the
information on which it is based, for at least 4 years after the end of
each cost reporting period to which the allocation applies.
Sec. 415.70 Limits on compensation for physician services in providers.
(a) Principle and scope. (1) Except as provided in paragraphs (a)(2)
and (a)(3) of this section, CMS establishes reasonable compensation
equivalency limits on the amount of compensation paid to physicians by
providers. These limits are applied to a provider's costs incurred in
compensating physicians for services to the provider, as described in
Sec. 415.55(a).
(2) Limits established under this section do not apply to costs of
physician compensation attributable to furnishing inpatient hospital
services that are paid for under the prospective payment system
implemented under part 412 of this chapter or to costs of physician
compensation attributable to approved GME programs that are payable
under Sec. Sec. 413.75 through 413.83 of this chapter.
(3) Compensation that a physician receives for activities that may
not be paid for under either Part A or Part B of Medicare is not
considered in applying these limits.
(b) Methodology for establishing limits. (1) For cost reporting
periods beginning before January 1, 2015. CMS establishes a methodology
for determining annual reasonable compensation equivalency limits and,
to the extent possible, considers average physician incomes by specialty
and type of location using the best available data.
(2) For cost reporting periods beginning on or after January 1,
2015. CMS establishes a methodology for determining annual reasonable
compensation equivalency limits and, to the extent possible, considers
average physician incomes by specialty using the best available data.
(c) Application of limits. If the level of compensation exceeds the
limits established under paragraph (b) of this section, Medicare payment
is based on the level established by the limits.
(d) Adjustment of the limits. The intermediary may adjust limits
established under paragraph (b) of this section to account for costs
incurred by the physician or the provider related to malpractice
insurance, professional memberships, and continuing medical education.
(1) For the costs of membership in professional societies and
continuing medical education, the intermediary may adjust the limit by
the lesser of--
(i) The actual cost incurred by the provider or the physician for
these activities; or
(ii) Five percent of the appropriate limit.
(2) For the cost of malpractice expenses incurred by either the
provider or the physician, the intermediary may adjust the reasonable
compensation equivalency limit by the cost of the malpractice insurance
expense related to the physician service furnished to patients in
providers.
(e) Exception to limits. An intermediary may grant a provider an
exception to the limits established under paragraph (b) of this section
only if the provider can demonstrate to the intermediary that it is
unable to recruit or maintain an adequate number of physicians at a
compensation level within these limits.
(f) Notification of changes in methodologies and payment limits. (1)
Before the start of a cost reporting period to which limits established
under this section will be applied, CMS publishes a notice in the
Federal Register that sets forth the amount of the limits and explains
how it calculated the limits.
(2) If CMS proposes to revise the methodology for establishing
payment limits under this section, CMS publishes a notice, with
opportunity for public comment, in the Federal Register. The notice
explains the proposed basis and methodology for setting limits,
specifies the limits that would result, and states the date of
implementation of the limits.
(3) If CMS updates limits by applying the most recent economic index
data without revising the limit methodology, CMS publishes the revised
limits in a notice in the Federal Register
[[Page 211]]
without prior publication of a proposal or public comment period.
[60 FR 63178, Dec. 8, 1995, as amended at 70 FR 47490, Aug. 12, 2005; 79
FR 50358, Aug. 22, 2014]
Subpart C_Part B Carrier Payments for Physician Services to
Beneficiaries in Providers
Sec. 415.100 Scope.
This subpart implements section 1887(a)(1)(A) of the Act by
providing general conditions that must be met in order for services
furnished by physicians to beneficiaries in providers to be paid for on
the basis of the physician fee schedule under part 414 of this chapter.
Section 415.102 sets forth the conditions for fee schedule payment for
physician services to beneficiaries in providers. Section 415.105 sets
forth general requirements for determining the amounts of payment for
services that meet the conditions of this section. Sections 415.120 and
415.130 set forth additional conditions for payment for physician
services in the specialties of radiology and pathology (laboratory
services).
Sec. 415.102 Conditions for fee schedule payment for physician services
to beneficiaries in providers.
(a) General rule. If the physician furnishes services to
beneficiaries in providers, the carrier pays on a fee schedule basis
provided the following requirements are met:
(1) The services are personally furnished for an individual
beneficiary by a physician.
(2) The services contribute directly to the diagnosis or treatment
of an individual beneficiary.
(3) The services ordinarily require performance by a physician.
(4) In the case of radiology or laboratory services, the additional
requirements in Sec. 415.120 or Sec. 415.130, respectively, are met.
(b) Exception. If a physician furnishes services in a provider that
do not meet the requirements in paragraph (a) of this section, but are
related to beneficiary care furnished by the provider, the intermediary
pays for those services, if otherwise covered. The intermediary follows
the rules in Sec. Sec. 415.55 and 415.60 for payment on the basis of
reasonable cost or PPS, as appropriate.
(c) Effect of billing charges for physician services to a provider.
(1) If a physician furnishes services that may be paid under the
reasonable cost rules in Sec. 415.55 or Sec. 415.60, and paid by the
intermediary, or would be paid under those rules except for the PPS
rules in part 412 of this chapter, and under the payment rules for GME
established by Sec. Sec. 413.75 through 413.83 of this chapter, neither
the provider nor the physician may seek payment from the carrier,
beneficiary, or another insurer.
(2) If a physician furnishes services to an individual beneficiary
that do not meet the applicable conditions in Sec. Sec. 415.120
(concerning conditions for payment for radiology services) and 415.130
(concerning conditions for payment for physician pathology services),
the carrier does not pay on a fee schedule basis.
(3) If the physician, the provider, or another entity bills the
carrier or the beneficiary or another insurer for physician services
furnished to the provider, as described in Sec. 415.55(a), CMS
considers the provider to which the services are furnished to have
violated its provider participation agreement, and may terminate that
agreement. See part 489 of this chapter for rules governing provider
agreements.
(d) Effect of physician assumption of operating costs. If a
physician or other entity enters into an agreement (such as a lease or
concession) with a provider, and the physician (or entity) assumes some
or all of the operating costs of the provider department in which the
physician furnishes physician services, the following rules apply:
(1) If the conditions set forth in paragraph (a) of this section are
met, the carrier pays for the physician services under the physician fee
schedule in part 414 of this chapter.
(2) To the extent the provider incurs a cost payable on a reasonable
cost basis under part 413 of this chapter, the intermediary pays the
provider on a reasonable cost basis for the costs associated with
producing these services, including overhead, supplies, equipment costs,
and services furnished by nonphysician personnel.
[[Page 212]]
(3) The physician (or other entity) is treated as being related to
the provider within the meaning of Sec. 413.17 of this chapter
(concerning cost to related organizations).
(4) The physician (or other entity) must make its books and records
available to the provider and the intermediary as necessary to verify
the nature and extent of the costs of the services furnished by the
physician (or other entity).
[60 FR 63178, Dec. 8, 1995, as amended at 70 FR 47490, Aug. 12, 2005]
Sec. 415.105 Amounts of payment for physician services
to beneficiaries in providers.
(a) General rule. The carrier determines amounts of payment for
physician services to beneficiaries in providers in accordance with the
general rules governing the physician fee schedule payment in part 414
of this chapter, except as provided in paragraph (b) of this section.
(b) Application in certain settings--(1) Teaching hospitals. The
carrier applies the rules in subpart D of this part (concerning
physician services in teaching settings), in addition to those in this
section, in determining whether fee schedule payment should be made for
physician services to individual beneficiaries in a teaching hospital.
(2) Hospital-based ESRD facilities. The carrier applies Sec. Sec.
414.310 through 414.314 of this chapter, which set forth determination
of reasonable charges under the ESRD program, to determine the amount of
payment for physician services furnished to individual beneficiaries in
a hospital-based ESRD facility approved under part 405 subpart U.
Sec. 415.110 Conditions for payment: Medically directed anesthesia services.
(a) General payment rule. Medicare pays for the physician's medical
direction of anesthesia services for one service or two through four
concurrent anesthesia services furnished after December 31, 1998, only
if each of the services meets the condition in Sec. 415.102(a) and the
following additional conditions:
(1) For each patient, the physician--
(i) Performs a pre-anesthetic examination and evaluation;
(ii) Prescribes the anesthesia plan;
(iii) Personally participates in the most demanding aspects of the
anesthesia plan including, if applicable, induction and emergence;
(iv) Ensures that any procedures in the anesthesia plan that he or
she does not perform are performed by a qualified individual as defined
in operating instructions;
(v) Monitors the course of anesthesia administration at frequent
intervals;
(vi) Remains physically present and available for immediate
diagnosis and treatment of emergencies; and
(vii) Provides indicated post-anesthesia care.
(2) The physician directs no more than four anesthesia services
concurrently and does not perform any other services while he or she is
directing the single or concurrent services so that one or more of the
conditions in paragraph (a)(1) of this section are not violated.
(3) If the physician personally performs the anesthesia service, the
payment rules in Sec. 414.46(c) of this chapter apply (Physician
personally performs the anesthesia procedure).
(b) Medical documentation. The physician alone inclusively documents
in the patient's medical record that the conditions set forth in
paragraph (a)(1) of this section have been satisfied, specifically
documenting that he or she performed the pre-anesthetic exam and
evaluation, provided the indicated post-anesthesia care, and was present
during the most demanding procedures, including induction and emergence
where applicable.
[63 FR 58912, Nov. 2, 1998]
Sec. 415.120 Conditions for payment: Radiology services.
(a) Services to beneficiaries. The carrier pays for radiology
services furnished by a physician to a beneficiary on a fee schedule
basis only if the services meet the conditions for fee schedule payment
in Sec. 415.102(a) and are identifiable, direct, and discrete
diagnostic or therapeutic services furnished to an individual
beneficiary, such as interpretation of x-ray plates, angiograms,
myelograms, pyelograms, or
[[Page 213]]
ultrasound procedures. The carrier pays for interpretations only if
there is a written report prepared for inclusion in the patient's
medical record maintained by the hospital.
(b) Services to providers. The carrier does not pay on a fee
schedule basis for physician services to the provider (for example,
administrative or supervisory services) or for provider services needed
to produce the x-ray films or other items that are interpreted by the
radiologist. However, the intermediary pays the provider for these
services in accordance with Sec. 415.55 for provider costs; Sec.
415.102(d)(2) for costs incurred by a physician, such as under a lease
or concession agreement; or part 412 of this chapter for payment under
PPS.
Sec. 415.130 Conditions for payment: Physician pathology services.
(a) Definitions. The following definitions are used in this section.
(1) Covered hospital means, with respect to an inpatient or an
outpatient, a hospital that had an arrangement with an independent
laboratory that was in effect as of July 22, 1999, under which a
laboratory furnished the technical component of physician pathology
services to fee-for-service Medicare beneficiaries who were hospital
inpatients or outpatients, and submitted claims for payment for this
technical component directly to a Medicare carrier.
(2) Fee-for-service Medicare beneficiaries means those beneficiaries
who are entitled to benefits under Part A or are enrolled under Part B
of Title XVIII of the Act or both and are not enrolled in any of the
following:
(i) A Medicare + Choice plan under Part C of Title XVIII of the Act.
(ii) A plan offered by an eligible organization under section 1876
of the Act;
(iii) A program of all-inclusive care for the elderly (PACE) under
1894 of the Act; or
(iv) A social health maintenance organization (SHMO) demonstration
project established under section 4018(b) of the Omnibus Budget
Reconciliation Act of 1987.
(b) Physician pathology services. The carrier pays for pathology
services furnished by a physician to an individual beneficiary on a fee
schedule basis only if the services meet the conditions for payment in
Sec. 415.102(a) and are one of the following services:
(1) Surgical pathology services.
(2) Specific cytopathology, hematology, and blood banking services
that have been identified to require performance by a physician and are
listed in program operating instructions.
(3) Clinical consultation services that meet the requirements in
paragraph (c) of this section.
(4) Clinical laboratory interpretative services that meet the
requirements of paragraphs (c)(1), (c)(3), and (c)(4) of this section
and that are specifically listed in program operating instructions.
(c) Clinical consultation services. For purposes of this section,
clinical consultation services must meet the following requirements:
(1) Be requested by the beneficiary's attending physician.
(2) Relate to a test result that lies outside the clinically
significant normal or expected range in view of the condition of the
beneficiary.
(3) Result in a written narrative report included in the
beneficiary's medical record.
(4) Require the exercise of medical judgment by the consultant
physician.
(d) Physician pathology services furnished by an independent
laboratory. (1) The technical component of physician pathology services
furnished by an independent laboratory to a hospital inpatient or
outpatient on or before June 30, 2012, may be paid to the laboratory by
the contractor under the physician fee schedule if the Medicare
beneficiary is a patient of a covered hospital as defined in paragraph
(a)(1) of this section.
(2) For services furnished after June 30, 2012, an independent
laboratory may not bill the Medicare contractor for the technical
component of physician pathology services furnished to a hospital
inpatient or outpatient.
(3) For services furnished on or after January 1, 2008, the date of
service policy in Sec. 414.510 of this chapter applies to
[[Page 214]]
the TC of specimens for physician pathology services.
[60 FR 63178, Dec. 8, 1995, as amended at 64 FR 59442, Nov. 2, 1999; 66
FR 55332, Nov. 1, 2001; 71 FR 69788, Dec. 1, 2006; 72 FR 66405, Nov. 27,
2007; 73 FR 69938, Nov. 19, 2008; 75 FR 73626, Nov. 29, 2010; 76 FR
73473, Nov. 28, 2011; 77 FR 69371, Nov. 16, 2012]
Subpart D_Physician Services in Teaching Settings
Sec. 415.150 Scope.
This subpart sets forth the rules governing payment for the services
of physicians in teaching settings and the criteria for determining
whether the payments are made as one of the following:
(a) Services to the hospital under the reasonable cost election in
Sec. Sec. 415.160 through 415.164.
(b) Provider services through the direct GME payment mechanism in
Sec. Sec. 413.75 through 413.83 of this chapter.
(c) Physician services to beneficiaries under the physician fee
schedule as set forth in part 414 of this chapter.
[60 FR 63178, Dec. 8, 1995, as amended at 70 FR 47490, Aug. 12, 2005]
Sec. 415.152 Definitions.
As used in this subpart--
Approved graduate medical education (GME) program means one of the
following:
(1) A residency program approved by the Accreditation Council for
Graduate Medical Education, by the American Osteopathic Association, by
the Commission on Dental Accreditation of the American Dental
Association, or by the Council on Podiatric Medical Education of the
American Podiatric Medical Association.
(2) A program otherwise recognized as an ``approved medical
residency program'' under Sec. 413.75(b) of this chapter.
Direct medical and surgical services means services to individual
beneficiaries that are either personally furnished by a physician or
furnished by a resident under the supervision of a physician in a
teaching hospital making the cost election described in Sec. Sec.
415.160 through 415.162.
Nonprovider setting means a setting other than a hospital, skilled
nursing facility, home health agency, or comprehensive outpatient
rehabilitation facility in which residents furnish services. These
include, but are not limited to, family practice or multispecialty
clinics and physician offices.
Resident means one of the following:
(1) An individual who participates in an approved GME program,
including programs in osteopathy, dentistry, and podiatry.
(2) A physician who is not in an approved GME program, but who is
authorized to practice only in a hospital, for example, individuals with
temporary or restricted licenses, or unlicensed graduates of foreign
medical schools. For purposes of this subpart, the term resident is
synonymous with the terms intern and fellow.
Teaching hospital means a hospital engaged in an approved GME
residency program in medicine, osteopathy, dentistry, or podiatry.
Teaching physician means a physician (other than another resident)
who involves residents in the care of his or her patients.
Teaching setting means any provider, hospital-based provider, or
nonprovider settings in which Medicare payment for the services of
residents is made under the direct GME payment provisions of Sec. Sec.
413.75 through 413.83, or on a reasonable-cost basis under the
provisions of Sec. 409.26 or Sec. 409.40(f) for resident services
furnished in skilled nursing facilities or home health agencies,
respectively.
[60 FR 63178, Dec. 8, 1995, as amended at 61 FR 59554, Nov. 22, 1996; 63
FR 26359, May 12, 1998; 70 FR 47490, Aug. 12, 2005; 74 FR 44001, Aug.
27, 2009; 75 FR 50418, Aug. 16, 2010]
Sec. 415.160 Election of reasonable cost payment for direct medical
and surgical services of physicians in teaching hospitals: General provisions.
(a) Scope. A teaching hospital may elect to receive payment on a
reasonable cost basis for the direct medical and surgical services of
its physicians in lieu of fee schedule payments that might otherwise be
made for these services.
(b) Conditions. A teaching hospital may elect to receive these
payments only if--
(1) The hospital notifies its intermediary in writing of the
election and
[[Page 215]]
meets the conditions of either paragraph (b)(2) or paragraph (b)(3) of
this section;
(2) All physicians who furnish services to Medicare beneficiaries in
the hospital agree not to bill charges for these services; or
(3) All physicians who furnish services to Medicare beneficiaries in
the hospital are employees of the hospital and, as a condition of
employment, are precluded from billing for these services.
(c) Effect of election. If a teaching hospital elects to receive
reasonable cost payment for physician direct medical and surgical
services furnished to beneficiaries--
(1) Those services and the supervision of interns and residents
furnishing care to individual beneficiaries are covered as hospital
services, and
(2) The intermediary pays the hospital for those services on a
reasonable cost basis under the rules in Sec. 415.162. (Payment for
other physician compensation costs related to approved GME programs is
made as described in Sec. 413.78 of this chapter.)
(d) Election declined. If the teaching hospital does not make this
election, payment is made--
(1) For physician services furnished to beneficiaries on a fee
schedule basis as described in part 414 subject to the rules in this
subpart, and
(2) For the supervision of interns and residents as described in
Sec. Sec. 413.75 through 413.83.
[60 FR 63178, Dec. 8, 1995, as amended at 70 FR 47490, Aug. 12, 2005]
Sec. 415.162 Determining payment for physician services
furnished to beneficiaries in teaching hospitals.
(a) General rule. Payments for direct medical and surgical services
of physicians furnished to beneficiaries and supervision of interns and
residents furnishing care to beneficiaries is made by Medicare on the
basis of reasonable cost if the hospital exercises the election as
provided for in Sec. 415.160. If this election is made, the following
occurs:
(1) Physician services furnished to beneficiaries and supervision of
interns and residents furnishing care to beneficiaries are paid on a
reasonable-cost basis, as provided for in paragraph (b) of this section.
(2) Payment for certain medical school costs may be made as provided
for in paragraph (c) of this section.
(3) Payments for services donated by volunteer physicians to
beneficiaries are made to a fund designated by the organized medical
staff of the teaching hospital or medical school as provided for in
paragraph (d) of this section.
(b) Reasonable cost of physician services and supervision of interns
and residents. (1) Physician services furnished to beneficiaries and
supervision of interns and residents furnishing care to beneficiaries in
a teaching hospital are payable as provider services on a reasonable-
cost basis.
(2) For purposes of this paragraph, reasonable cost is defined as
the direct salary paid to these physicians, plus applicable fringe
benefits.
(3) The costs must be allocated to the services as provided by
paragraph (j) of this section and apportioned to program beneficiaries
as provided by paragraph (g) of this section.
(4) Other allowable costs incurred by the provider related to the
services described in this paragraph are payable subject to the
requirements applicable to all other provider services.
(c) Reasonable costs for the services furnished by a medical school
or related organization in a hospital. An amount is payable to the
hospital by CMS under the Medicare program provided that the costs would
be payable if incurred directly by the hospital rather than under the
arrangement. The amount must not be in excess of the reasonable costs
(as defined in paragraphs (c)(1) and (c)(2) of this section) incurred by
a teaching hospital for services furnished by a medical school or
organization as described in Sec. 413.17 of this chapter for certain
costs to the medical school (or a related organization) in furnishing
services in the hospital.
(1) Reasonable costs of physician services--(i) When the medical
school and the hospital are related organizations. If the medical school
(or organization related to the medical school) and the hospital are
related by common ownership or control as described in Sec. 413.17 of
this chapter--
[[Page 216]]
(A) The costs of these services are allowable costs to the hospital
under the provisions of Sec. 413.17 of this chapter; and
(B) The reimbursable costs to the hospital are determined under the
provisions of this section in the same manner as the costs incurred for
physicians on the hospital staff and without regard to payments made to
the medical school by the hospital.
(ii) When the medical school and the hospital are not related
organizations. (A) If the medical school and the hospital are not
related organizations under the provisions of Sec. 413.17 of this
chapter and the hospital makes payment to the medical school for the
costs of those services furnished to all patients, payment is made by
Medicare to the hospital for the reasonable cost incurred by the
hospital for its payments to the medical school for services furnished
to beneficiaries.
(B) Costs incurred under an arrangement must be allocated to the
full range of services furnished to the hospital by the medical school
physicians on the same basis as provided for under paragraph (j) of this
section, and costs allocated to direct medical and surgical services
furnished to hospital patients must be apportioned to beneficiaries as
provided for under paragraph (g) of this section.
(C) If the medical school and the hospital are not related
organizations under the provisions of Sec. 413.17 of this chapter and
the hospital makes payment to the medical school only for the costs of
those services furnished to beneficiaries, costs of the medical school
not to exceed 105 percent of the sum of physician direct salaries,
applicable fringe benefits, employer's portion of FICA taxes, Federal
and State unemployment taxes, and workmen's compensation paid by the
medical school or an organization related to the medical school may be
recognized as allowable costs of the medical school.
(D) These allowable medical school costs must be allocated to the
full range of services furnished by the physicians of the medical school
or organization related as provided by paragraph (j) of this section.
(E) Costs allocated to direct medical and surgical services
furnished to hospital patients must be apportioned to beneficiaries as
provided by paragraph (g) of this section.
(2) Reasonable costs of other than direct medical and surgical
services. These costs are determined in accordance with paragraph (c)(1)
of this section except that--
(i) If the hospital makes payment to the medical school for other
than direct medical and surgical services furnished to beneficiaries and
supervision of interns and residents furnishing care to beneficiaries,
these payments are subject to the required cost-finding and
apportionment methods applicable to the cost of other hospital services
(except for direct medical and surgical services furnished to
beneficiaries); or
(ii) If the hospital makes payment to the medical school only for
these services furnished to beneficiaries, the cost of these services is
not subject to cost-finding and apportionment as otherwise provided by
this subpart, and the reasonable cost paid by Medicare must be
determined on the basis of the health insurance ratio(s) used in the
apportionment of all other provider costs (excluding physician direct
medical and surgical services furnished to beneficiaries) applied to the
allowable medical school costs incurred by the medical school for the
services furnished to all patients of the hospital.
(d) ``Salary equivalent'' payments for direct medical and surgical
services furnished by physicians on the voluntary staff of the hospital.
(1) CMS makes payments under the Medicare program to a fund as defined
in Sec. 415.164 for direct medical and surgical services furnished to
beneficiaries on a regularly scheduled basis by physicians on the unpaid
voluntary medical staff of the hospital (or medical school under
arrangement with the hospital).
(i) These payments represent compensation for contributed medical
staff time which, if not contributed, would have to be obtained through
employed staff on a payable basis.
(ii) Payments for volunteer services are determined by applying to
the regularly scheduled contributed time an
[[Page 217]]
hourly rate not to exceed the equivalent of the average direct salary
(exclusive of fringe benefits) paid to all full-time, salaried
physicians (other than interns and residents) on the hospital staff or,
if the number of full-time salaried physicians is minimal in absolute
terms or in relation to the number of physicians on the voluntary staff,
to physicians at like institutions in the area.
(iii) This ``salary equivalent'' is a single hourly rate covering
all physicians regardless of specialty and is applied to the actual
regularly scheduled time contributed by the physicians in furnishing
direct medical and surgical services to beneficiaries including
supervision of interns and residents in that care.
(iv) A physician who receives any compensation from the hospital or
a medical school related to the hospital by common ownership or control
(within the meaning of Sec. 413.17 of this chapter) for direct medical
and surgical services furnished to any patient in the hospital is not
considered an unpaid voluntary physician for purposes of this paragraph.
(v) If, however, a physician receives compensation from the hospital
or related medical school or organization only for services that are
other than direct medical and surgical services, a salary equivalent
payment for the physician's regularly scheduled direct medical and
surgical services to beneficiaries in the hospital may be imputed.
However, the sum of the imputed value for volunteer services and the
physician's actual compensation from the hospital and the related
medical school (or organization) may not exceed the amount that would
have been imputed if all of the physician's hospital and medical school
services (compensated and volunteer) had been volunteer services, or
paid at the rate of $30,000 per year, whichever is less.
(2) The following examples illustrate how the allowable imputed
value for volunteer services is determined. In each example, it has been
assumed that the average salary equivalent hourly rate is equal to the
hourly rate for the individual physician's compensated services.
Example No: 1. Dr. Jones received $3,000 a year from Hospital X for
services other than direct medical services to all patients, for
example, utilization review and administrative services. Dr. Jones also
voluntarily furnished direct medical services to beneficiaries. The
imputed value of the volunteer services amounted to $10,000 for the cost
reporting period. The full imputed value of Dr. Jones' volunteer direct
medical services would be allowed since the total amount of the imputed
value ($10,000) and the compensated services ($3,000) does not exceed
$30,000.
Example No: 2. Dr. Smith received $25,000 from Hospital X for
services as a department head in a teaching hospital. Dr. Smith also
voluntarily furnished direct medical services to beneficiaries. The
imputed value of the volunteer services amounted to $10,000. Only $5,000
of the imputed value of volunteer services would be allowed since the
total amount of the imputed value ($10,000) and the compensated services
($25,000) exceeds the $30,000 maximum amount allowable for all of Dr.
Smith's services.
Computation:
Maximum amount allowable for all services performed by Dr. $30,000
Smith for purposes of this computation......................
Less compensation received from Hospital X for other than $25,000
direct medical services to individual patients..............
Allowable amount of imputed value for the volunteer services $5,000
furnished by Dr. Smith......................................
Example No. 3. Dr. Brown is not compensated by Hospital X for any
services furnished in the hospital. Dr. Brown voluntarily furnished
direct surgical services to beneficiaries for a period of 6 months, and
the imputed value of these services amounted to $20,000. The allowable
amount of the imputed value for volunteer services furnished by Dr.
Brown would be limited to $15,000 ($30,000 x 6/12).
(3) The amount of the imputed value for volunteer services
applicable to beneficiaries and payable to a fund is determined in
accordance with the aggregate per diem method described in paragraph (g)
of this section.
(4) Medicare payments to a fund must be used by the fund solely for
improvement of care of hospital patients or for educational or
charitable purposes (which may include but are not limited to medical
and other scientific research).
(i) No personal financial gain, either direct or indirect, from
benefits of the fund may inure to any of the hospital
[[Page 218]]
staff physicians, medical school faculty, or physicians for whom
Medicare imputes costs for purposes of payment into the fund.
(ii) Expenses met from contributions made to the hospital from a
fund are not included as a reimbursable cost when expended by the
hospital, and depreciation expense is not allowed with respect to
equipment or facilities donated to the hospital by a fund or purchased
by the hospital from monies in a fund.
(e) Requirements for payment--(1) Physicians on the hospital staff.
The requirements under which the costs of physician direct medical and
surgical services (including supervision of interns and residents) to
beneficiaries are the same as those applicable to the cost of all other
covered provider services except that the costs of these services are
separately determined as provided by this section and are not subject to
cost-finding as described in Sec. 413.24 of this chapter.
(2) Physicians on the medical school faculty. Payment is made to a
hospital for the costs of services of physicians on the medical school
faculty, provided that if the medical school is not related to the
hospital (within the meaning of Sec. 413.17 of this chapter, concerning
cost to related organizations), the hospital does not make payment to
the medical school for services furnished to all patients and the
following requirements are met: If the hospital makes payment to the
medical school for services furnished to all patients, these
requirements do not apply. (See paragraph (c)(1)(ii) of this section.)
(i) There is a written agreement between the hospital and the
medical school or organization, specifying the types and extent of
services to be furnished by the medical school and specifying that the
hospital must pay to the medical school an amount at least equal to the
reasonable cost (as defined in paragraph (c) of this section) of
furnishing the services to beneficiaries.
(ii) The costs are paid to the medical school by the hospital no
later than the date on which the cost report covering the period in
which the services were furnished is due to CMS.
(iii) Payment for the services furnished under an arrangement would
have been made to the hospital had the services been furnished directly
by the hospital.
(3) Physicians on the voluntary staff of the hospital (or medical
school under arrangement with the hospital). If the conditions for
payment to a fund outlined in Sec. 415.164 are met, payments are made
on a ``salary equivalent'' basis (as defined in paragraph (d) of this
section) to a fund.
(f) Requirements for payment for medical school faculty services
other than physician direct medical and surgical services. If the
requirements for payment for physician direct medical and surgical
services furnished to beneficiaries in a teaching hospital described in
paragraph (e) of this section are met, payment is made to a hospital for
the costs of medical school faculty services other than physician direct
medical and surgical services furnished in a teaching hospital.
(g) Aggregate per diem methods of apportionment--(1) For the costs
of physician direct medical and surgical services. The cost of physician
direct medical and surgical services furnished in a teaching hospital to
beneficiaries is determined on the basis of an average cost per diem as
defined in paragraph (h)(1) of this section for physician direct medical
and surgical services to all patients (see Sec. Sec. 415.172 through
415.184) for each of the following categories of physicians:
(i) Physicians on the hospital staff.
(ii) Physicians on the medical school faculty.
(2) For the imputed value of physician volunteer direct medical and
surgical services. The imputed value of physician direct medical and
surgical services furnished to beneficiaries in a teaching hospital is
determined on the basis of an average per diem, as defined in paragraph
(h)(1) of this section, for physician direct medical and surgical
services to all patients except that the average per diem is derived
from the imputed value of the physician volunteer direct medical and
surgical services furnished to all patients.
(h) Definitions. (1) Average cost per diem for physician direct
medical and surgical services (including supervision of interns and
residents) furnished in a teaching hospital to patients in each category
[[Page 219]]
of physician services described in paragraph (g)(1) of this section
means the amount computed by dividing total reasonable costs of these
services in each category by the sum of--
(i) Inpatient days (as defined in paragraph (h)(2) of this section);
and
(ii) Outpatient visit days (as defined in paragraph (h)(3) of this
section).
(2) Inpatient days are determined by counting the day of admission
as 3.5 days and each day after a patient's day of admission, except the
day of discharge, as 1 day.
(3) Outpatient visit days are determined by counting only one visit
day for each calendar day that a patient visits an outpatient department
or multiple outpatient departments.
(i) Application. (1) The following illustrates how apportionment
based on the aggregate per diem method for costs of physician direct
medical and surgical services furnished in a teaching hospital to
patients is determined.
Teaching Hospital Y
Statistical and financial data:
Total inpatient days as defined in paragraph (h)(2) of this 75,000
section and outpatient visit days as defined in paragraph
(h)(3) of this section....................................
Total inpatient Part A days................................ 20,000
Total inpatient Part B days where Part A coverage is not 1,000
available.................................................
Total outpatient Part B visit days......................... 5,000
Total cost of direct medical and surgical services $1,500,000
furnished to all patients by physicians on the hospital
staff as determined in accordance with paragraph (i) of
this section..............................................
Total cost of direct medical and surgical services $1,650,000
furnished to all patients by physicians on the medical
school faculty as determined in accordance with paragraph
(i) of this section.......................................
Computation of cost applicable to program for physicians on the
hospital staff:
Average cost per diem for direct medical and surgical services to
patients by physicians on the hospital staff: $1,500,000 / 75,000 = $20
per diem.
Cost of physician direct medical and surgical services $400,000
furnished to inpatient beneficiaries covered under Part A:
$20 per diem x 20,000.....................................
Cost of physician direct medical and surgical services $20,000
furnished to inpatient beneficiaries covered under Part B:
$20 per diem x 1,000......................................
Cost of physician direct medical and surgical services $100,000
furnished to outpatient beneficiaries covered under Part
B: $20 per diem x 5,000...................................
Computation of cost applicable to program for physicians on the
medical school faculty:
Average cost per diem for direct medical and surgical services to
patients by physicians on the medical school faculty: $1,650,000 /
75,000 = $22 per diem.
Cost of physician direct medical and surgical services $440,000
furnished to inpatient beneficiaries covered under Part A:
$22 per diem x 20,000.....................................
Cost of physician direct medical and surgical services $22,000
furnished to inpatient beneficiaries covered under Part B:
$20 per diem x 1,000......................................
Cost of physician direct medical and surgical services $110,000
furnished to outpatient beneficiaries covered under Part
B: $22 per diem x 5,000...................................
(2) The following illustrates how the imputed value of physician
volunteer direct medical and surgical services furnished in a teaching
hospital to beneficiaries is determined.
Example: The physicians on the medical staff of Teaching Hospital Y
donated a total of 5,000 hours in furnishing direct medical and surgical
services to patients of the hospital during a cost reporting period and
did not receive any compensation from either the hospital or the medical
school. Also, the imputed value for any physician volunteer services did
not exceed the rate of $30,000 per year per physician.
Statistical and financial data:
Total salaries paid to the full-time salaried physicians by $800,000
the hospital (excluding interns and residents)............
Total physicians who were paid for an average of 40 hours 20
per week or 2,080 (52 weeks x 40 hours per week) hours per
year......................................................
Average hourly rate equivalent: $800,000 / 41,600 (2,080 x $19.23
20).......................................................
Computation of total imputed value of physician volunteer services
applicable to all patients:
(Total donated hours x average hourly rate equivalent): $96,150
5,000 x $19.23............................................
[[Page 220]]
Total inpatient days (as defined in paragraph (h)(2) of 75,000
this section) and outpatient visit days (as defined in
paragraph (h)(3) of this section).........................
Total inpatient Part A days................................ 20,000
Total inpatient Part B days if Part A coverage is not 1,000
available.................................................
Total outpatient Part B visit days......................... 5,000
Computation of imputed value of physician volunteer direct medical
and surgical services furnished to Medicare beneficiaries:
Average per diem for physician direct medical and surgical services
to all patients: $96,150 / 75,000 = $1.28 per diem
Imputed value of physician direct medical and surgical $25,600
services furnished to inpatient beneficiaries covered
under Part A: $1.28 per diem x 20,000.....................
Imputed value of physician direct medical and surgical $1,280
services furnished to inpatient beneficiaries covered
under Part B: $1.28 per diem x 1,000......................
Imputed value of physician direct medical and surgical $6,400
services furnished to outpatient beneficiaries covered
under Part B: $1.28 per diem x 5,000......................
Total...................................................... $33,280
(j) Allocation of compensation paid to physicians in a teaching
hospital. (1) In determining reasonable cost under this section, the
compensation paid by a teaching hospital, or a medical school or related
organization under arrangement with the hospital, to physicians in a
teaching hospital must be allocated to the full range of services
implicit in the physician compensation arrangements. (However, see
paragraph (d) of this section for the computation of the ``salary
equivalent'' payments for volunteer services furnished to patients.)
(2) This allocation must be made and must be capable of
substantiation on the basis of the proportion of each physician's time
spent in furnishing each type of service to the hospital or medical
school.
Sec. 415.164 Payment to a fund.
(a) General rules. Payment for certain voluntary services by
physicians in teaching hospitals (as these services are described in
Sec. 415.160) is made on a salary equivalent basis (as described in
Sec. 415.162(d)) subject to the conditions and limitations contained in
parts 405 and 413 of this chapter and this part 415, to a single fund
(as defined in paragraph (b) of this section) designated by the
organized medical staff of the hospital (or, if the services are
furnished in the hospital by the faculty of a medical school, to a fund
as may be designated by the faculty), if the following conditions are
met:
(1) The hospital (or medical school furnishing the services under
arrangement with the hospital) incurs no actual cost in furnishing the
services.
(2) The hospital has an agreement with CMS under part 489 of this
chapter.
(3) The intermediary, or CMS as appropriate, has received written
assurances that--
(i) The payment is used solely for the improvement of care of
hospital patients or for educational or charitable purposes; and
(ii) Neither the individuals who are furnished the services nor any
other persons are charged for the services (and if charged, provision is
made for the return of any monies incorrectly collected).
(b) Definition of a fund. For purposes of paragraph (a) of this
section, a fund is an organization that meets either of the following
requirements:
(1) The organization has and retains exemption, as a governmental
entity or under section 501(c)(3) of the Internal Revenue Code
(nonprofit educational, charitable, and similar organizations), from
Federal taxation.
(2) The organization is an organization of physicians who, under the
terms of their employment by an entity that meets the requirements of
paragraph (b)(1) of this section, are required to turn over to that
entity all income that the physician organization derives from the
physician services.
(c) Status of a fund. A fund approved for payment under paragraph
(a) of this section has all the rights and responsibilities of a
provider under Medicare except that it does not enter into an agreement
with CMS under part 489 of this chapter.
[[Page 221]]
Sec. 415.170 Conditions for payment on a fee schedule basis
for physician services in a teaching setting.
Services meeting the conditions for payment in Sec. 415.102(a)
furnished in teaching settings are payable under the physician fee
schedule if--
(a) The services are personally furnished by a physician who is not
a resident; or
(b) The services are furnished by a resident in the presence of a
teaching physician except as provided in Sec. 415.172 (concerning
physician fee schedule payment for services of teaching physicians),
Sec. 415.174 (concerning an exception for services furnished in
hospital outpatient and certain other ambulatory settings), Sec.
415.176 (concerning renal dialysis services), and Sec. 415.184
(concerning psychiatric services), as applicable.
Sec. 415.172 Physician fee schedule payment for services
of teaching physicians.
(a) General rule. If a resident participates in a service furnished
in a teaching setting, physician fee schedule payment is made only if a
teaching physician is present during the key portion of any service or
procedure for which payment is sought.
(1) In the case of surgical, high-risk, or other complex procedures,
the teaching physician must be present during all critical portions of
the procedure and immediately available to furnish services during the
entire service or procedure.
(i) In the case of surgery, the teaching physician's presence is not
required during opening and closing of the surgical field.
(ii) In the case of procedures performed through an endoscope, the
teaching physician must be present during the entire viewing.
(2) In the case of evaluation and management services, the teaching
physician must be present during the portion of the service that
determines the level of service billed. (However, in the case of
evaluation and management services furnished in hospital outpatient
departments and certain other ambulatory settings, the requirements of
Sec. 415.174 apply.)
(b) Documentation. Except for services furnished as set forth in
Sec. Sec. 415.174 (concerning an exception for services furnished in
hospital outpatient and certain other ambulatory settings), 415.176
(concerning renal dialysis services), and 415.184 (concerning
psychiatric services), the medical records must document the teaching
physician was present at the time the service is furnished. The presence
of the teaching physician during procedures and evaluation and
management services may be demonstrated by the notes in the medical
records made by a physician, resident, or nurse.
(c) Payment level. In the case of services such as evaluation and
management for which there are several levels of service codes available
for reporting purposes, the appropriate payment level must reflect the
extent and complexity of the service when fully furnished by the
teaching physician.
[60 FR 63178, Dec. 8, 1995, as amended at 83 FR 60091, Nov. 23, 2018]
Sec. 415.174 Exception: Evaluation and management services furnished
in certain centers.
(a) In the case of certain evaluation and management codes of lower
and mid-level complexity (as specified by CMS in program instructions),
carriers may make physician fee schedule payment for a service furnished
by a resident without the presence of a teaching physician. For the
exception to apply, all of the following conditions must be met:
(1) The services must be furnished in a center that is located in an
outpatient department of a hospital or another ambulatory care entity in
which the time spent by residents in patient care activities is included
in determining intermediary payments to a hospital under Sec. Sec.
413.75 through 413.83.
(2) Any resident furnishing the service without the presence of a
teaching physician must have completed more than 6 months of an approved
residency program.
(3) The teaching physician must not direct the care of more than
four residents at any given time and must direct the care from such
proximity as to constitute immediate availability. The teaching
physician must--
[[Page 222]]
(i) Have no other responsibilities at the time;
(ii) Assume management responsibility for those beneficiaries seen
by the residents;
(iii) Ensure that the services furnished are appropriate; and
(iv) Review with each resident during or immediately after each
visit, the beneficiary's medical history, physical examination,
diagnosis, and record of tests and therapies.
(4) The range of services furnished by residents in the center
includes all of the following:
(i) Acute care for undifferentiated problems or chronic care for
ongoing conditions.
(ii) Coordination of care furnished by other physicians and
providers.
(iii) Comprehensive care not limited by organ system, or diagnosis.
(5) The patients seen must be an identifiable group of individuals
who consider the center to be the continuing source of their health care
and in which services are furnished by residents under the medical
direction of teaching physicians.
(6) The medical records must document the extent of the teaching
physician's participation in the review and direction of services
furnished to each beneficiary. The extent of the teaching physician's
participation may be demonstrated by the notes in the medical records
made by a physician, resident, or nurse.
(b) Nothing in paragraph (a) of this section may be construed as
providing a basis for the coverage of services not determined to be
covered under Medicare, such as routine physical checkups.
[60 FR 63178, Dec. 8, 1995, as amended at 61 FR 59554, Nov. 22, 1996; 70
FR 47490, Aug. 12, 2005; 83 FR 60092, Nov. 23, 2018]
Sec. 415.176 Renal dialysis services.
In the case of renal dialysis services, physicians who are not paid
under the physician monthly capitation payment method (as described in
Sec. 414.314 of this chapter) must meet the requirements of Sec. Sec.
415.170 and 415.172 (concerning physician fee schedule payment for
services of teaching physicians).
Sec. 415.178 Anesthesia services.
(a) General rule. (1) For services furnished prior to January 1,
2010, an unreduced physician fee schedule payment may be made if a
physician is involved in a single anesthesia procedure involving an
anesthesia resident. In the case of anesthesia services, the teaching
physician must be present during all critical portions of the procedure
and immediately available to furnish services during the entire service
or procedure. The teaching physician cannot receive an unreduced fee if
he or she performs services involving other patients during the period
the anesthesia resident is furnishing services in a single case.
Additional rules for payment of anesthesia services involving residents
are specified in Sec. 414.46(c)(1)(iii) of this chapter.
(2) For services furnished on or after January 1, 2010, payment made
under Sec. 414.46(e) of this chapter if the teaching anesthesiologist
(or different teaching anesthesiologists in the same anesthesia group
practice) is present during all critical or key portions of the
anesthesia service or procedure involved; and the teaching
anesthesiologist (or another anesthesiologist with whom the teaching
anesthesiologist has entered into an arrangement) is immediately
available to furnish anesthesia services during the entire procedure.
(b) Documentation. Documentation must indicate the teaching
physician's presence during all critical or key portions of the
anesthesia procedure and the immediate availability of another teaching
anesthesiologist.
[74 FR 62014, Nov. 25, 2009]
Sec. 415.180 Teaching setting requirements for the interpretation
of diagnostic radiology and other diagnostic tests.
(a) General rule. Physician fee schedule payment is made for the
interpretation of diagnostic radiology and other diagnostic tests if the
interpretation is performed or reviewed by a physician other than a
resident.
(b) Documentation. Documentation must indicate that the physician
personally performed the interpretation or reviewed the resident's
interpretation with the resident.
[[Page 223]]
Sec. 415.184 Psychiatric services.
To qualify for physician fee schedule payment for psychiatric
services furnished under an approved GME program, the physician must
meet the requirements of Sec. Sec. 415.170 and 415.172, including
documentation, except that the requirement for the presence of the
teaching physician during the service in which a resident is involved
may be met by observation of the service by use of a one-way mirror,
video equipment, or similar device.
Sec. 415.190 Conditions of payment: Assistants at surgery
in teaching hospitals.
(a) Basis, purpose, and scope. This section describes the conditions
under which Medicare pays on a fee schedule basis for the services of an
assistant at surgery in a teaching hospital. This section is based on
section 1842(b)(7)(D)(I) of the Act and applies only to hospitals with
an approved GME residency program. Except as specified in paragraph (c)
of this section, fee schedule payment is not available for assistants at
surgery in hospitals with--
(1) A training program relating to the medical specialty required
for the surgical procedure; and
(2) A resident in a training program relating to the specialty
required for the surgery available to serve as an assistant at surgery.
(b) Definition. Assistant at surgery means a physician who actively
assists the physician in charge of a case in performing a surgical
procedure.
(c) Conditions for payment for assistants at surgery. Payment on a
fee schedule basis is made for the services of an assistant at surgery
in a teaching hospital only if the services meet one of the following
conditions:
(1) Are required as a result of exceptional medical circumstances.
(2) Are complex medical procedures performed by a team of
physicians, each performing a discrete, unique function integral to the
performance of a complex medical procedure that requires the special
skills of more than one physician.
(3) Constitute concurrent medical care relating to a medical
condition that requires the presence of, and active care by, a physician
of another specialty during surgery.
(4) Are medically required and are furnished by a physician who is
primarily engaged in the field of surgery, and the primary surgeon does
not use interns and residents in the surgical procedures that the
surgeon performs (including preoperative and postoperative care).
(5) Are not related to a surgical procedure for which CMS determines
that assistants are used less than 5 percent of the time.
Subpart E_Services of Residents
Sec. 415.200 Services of residents in approved GME programs.
(a) General rules. Services furnished in hospitals by residents in
approved GME programs are specifically excluded from being paid as
``physician services'' defined in Sec. 414.2 of this chapter and are
payable as hospital services. This exclusion applies whether or not the
resident is licensed to practice under the laws of the State in which he
or she performs the service. The payment methodology for services of
residents in hospitals and hospital-based providers is set forth in
Sec. Sec. 413.75 through 413.83 of this chapter.
(b) Exception. For low and mid-level evaluation and management
services furnished under certain conditions in centers located in
hospital outpatient departments and other ambulatory settings, see Sec.
415.174.
(c) Definitions. See Sec. 415.152 for definitions of terms used in
this subpart E.
[60 FR 63178, Dec. 8, 1995, as amended at 70 FR 47490, Aug. 12, 2005]
Sec. 415.202 Services of residents not in approved GME programs.
(a) General rules. For services of a physician employed by a
hospital who is authorized to practice only in a hospital setting and
for the services of a resident who is not in any approved GME program,
payment is made to the hospital on a Part B reasonable cost basis
regardless of whether the services are furnished to hospital inpatients
or outpatients.
(b) Payment. For services described in paragraph (a) of this
section, payment is made under Part B by reducing the
[[Page 224]]
reasonable costs of furnishing the services by the beneficiary
deductible and paying 80 percent of the remaining amount. No payment is
made for other costs of unapproved programs, such as administrative
costs related to teaching activities of physicians.
Sec. 415.204 Services of residents in skilled nursing facilities
and home health agencies.
(a) Medicare Part A payment. Payment is made under Medicare Part A
for interns' and residents' services furnished in the following settings
that meet the specified requirements:
(1) Skilled nursing facility. Payment to a participating skilled
nursing facility may include the cost of services of an intern or
resident who is in an approved GME program in a hospital with which the
skilled nursing facility has a transfer agreement that provides, in
part, for the transfer of patients and the interchange of medical
records.
(2) Home health agency. A participating home health agency may
receive payment for the cost of the services of an intern or resident
who is under an approved GME program of a hospital with which the home
health agency is affiliated or under common control if these services
are furnished as part of the home health visits for a Medicare
beneficiary. (Nevertheless, see Sec. Sec. 413.75 through 413.83 of this
chapter for the costs of approved GME programs in hospital-based
providers.)
(b) Medicare Part B payment. Medical services of a resident of a
hospital that are furnished by a skilled nursing facility or home health
agency are paid under Medicare Part B if payment is not provided under
Medicare Part A. Payment is made under Part B for a resident's services
by reducing the reasonable costs of furnishing the services by the
beneficiary deductible and paying 80 percent of the remaining amount.
[60 FR 63178, Dec. 8, 1995, as amended at 70 FR 47490, Aug. 12, 2005]
Sec. 415.206 Services of residents in nonprovider settings.
Patient care activities of residents in approved GME programs that
are furnished in nonprovider settings are payable in one of the
following two ways:
(a) Direct GME payments. If the conditions in Sec. 413.78 regarding
patient care activities and training of residents are met, the time
residents spend in nonprovider settings such as clinics, nursing
facilities, and physician offices in connection with approved GME
programs is included in determining the number of full-time equivalency
residents in the calculation of a teaching hospital's resident count.
The teaching physician rules on carrier payments in Sec. Sec. 415.170
through 415.184 apply in these teaching settings.
(b) Physician fee schedule. (1) Services furnished by a resident in
a nonprovider setting are covered as physician services and payable
under the physician fee schedule if the following requirements are met:
(i) The resident is fully licensed to practice medicine, osteopathy,
dentistry, or podiatry in the State in which the service is performed.
(ii) The time spent in patient care activities in the nonprovider
setting is not included in a teaching hospital's full-time equivalency
resident count for the purpose of direct GME payments.
(2) Payment may be made regardless of whether a resident is
functioning within the scope of his or her GME program in the
nonprovider setting.
(3) If fee schedule payment is made for the resident's services in a
nonprovider setting, payment must not be made for the services of a
teaching physician.
(4) The carrier must apply the physician fee schedule payment rules
set forth in subpart A of part 414 of this chapter to payments for
services furnished by a resident in a nonprovider setting.
[60 FR 63178, Dec. 8, 1995, as amended at 70 FR 47490, Aug. 12, 2005]
Sec. 415.208 Services of moonlighting residents.
(a) Definition. For purposes of this section, the term services of
moonlighting residents refers to services that licensed residents
perform that are outside the scope of an approved GME program.
[[Page 225]]
(b) Services in GME program hospitals. (1) The services of residents
to inpatients of hospitals in which the residents have their approved
GME program are not covered as physician services and are payable under
Sec. Sec. 413.75 through 413.83 regarding direct GME payments.
(2) Services of residents that are not related to their approved GME
programs and are performed in an outpatient department or emergency
department of a hospital in which they have their training program are
covered as physician services and payable under the physician fee
schedule if all of the following criteria are met:
(i) The services are identifiable physician services and meet the
conditions for payment of physician services to beneficiaries in
providers in Sec. 415.102(a).
(ii) The resident is fully licensed to practice medicine,
osteopathy, dentistry, or podiatry by the State in which the services
are performed.
(iii) The services performed can be separately identified from those
services that are required as part of the approved GME program.
(3) If the criteria specified in paragraph (b)(2) of this section
are met, the services of the moonlighting resident are considered to
have been furnished by the individual in his or her capacity as a
physician, rather than in the capacity of a resident. The carrier must
review the contracts and agreements for these services to ensure
compliance with the criteria specified in paragraph (b)(2) of this
section.
(4) No payment is made for services of a ``teaching physician''
associated with moonlighting services, and the time spent furnishing
these services is not included in the teaching hospital's full-time
equivalency count for the indirect GME payment (Sec. 412.105 of this
chapter) and for the direct GME payment (Sec. Sec. 413.75 through
413.83 of this chapter).
(c) Other settings. Moonlighting services of a licensed resident in
an approved GME program furnished outside the scope of that program in a
hospital or other setting that does not participate in the approved GME
program are payable under the physician fee schedule as set forth in
Sec. 415.206(b)(1).
[60 FR 63178, Dec. 8, 1995, as amended at 70 FR 47490, Aug. 12, 2005]
PART 416_AMBULATORY SURGICAL SERVICES--Table of Contents
Subpart A_General Provisions and Definitions
Sec.
416.1 Basis and scope.
416.2 Definitions.
Subpart B_General Conditions and Requirements
416.25 Basic requirements.
416.26 Qualifying for an agreement.
416.30 Terms of agreement with CMS.
416.35 Termination of agreement.
Subpart C_Specific Conditions for Coverage
416.40 Condition for coverage--Compliance with State licensure law.
416.41 Condition for coverage--Governing body and management.
416.42 Condition for coverage--Surgical services.
416.43 Conditions for coverage--Quality assessment and performance
improvement.
416.44 Condition for coverage--Environment.
416.45 Condition for coverage--Medical staff.
416.46 Condition for coverage--Nursing services.
416.47 Condition for coverage--Medical records.
416.48 Condition for coverage--Pharmaceutical services.
416.49 Condition for coverage--Laboratory and radiologic services.
416.50 Condition for coverage--Patient rights.
416.51 Conditions for coverage--Infection control.
416.52 Conditions for coverage--Patient admission, assessment and
discharge.
416.54 Condition for coverage--Emergency preparedness.
Subpart D_Scope of Benefits for Services Furnished Before January 1,
2008
416.60 General rules.
416.61 Scope of facility services.
416.65 Covered surgical procedures.
416.75 Performance of listed surgical procedures on an inpatient
hospital basis.
[[Page 226]]
416.76 Applicability.
Subpart E_Prospective Payment System for Facility Services Furnished
Before January 1, 2008
416.120 Basis for payment.
416.121 Applicability.
416.125 ASC facility services payment rate.
416.130 Publication of revised payment methodologies.
416.140 Surveys.
Subpart F_Coverage, Scope of ASC Services, and Prospective Payment
System for ASC Services Furnished on or After January 1, 2008
416.160 Basis and scope
416.161 Applicability of this subpart
416.163 General rules
416.164 Scope of ASC services
416.166 Covered surgical procedures
416.167 Basis of payment
416.171 Determination of payment rates for ASC services
416.172 Adjustments to national payment rates
416.173 Publication of revised payment methodologies and payment rates
416.178 Limitations on administrative and judicial review
416.179 Payment and coinsurance reduction for devices replaced without
cost or when full or partial credit is received.
Subpart G_Adjustment in Payment Amounts for New Technology Intraocular
Lenses Furnished by Ambulatory Service Centers
416.180 Basis and scope.
416.185 Process for establishing a new class of new technology IOLs.
416.190 Request for review of payment amount.
416.195 Determination of membership in new classes of new technology
IOLs.
416.200 Payment adjustment.
Subpart H_Requirements Under the Ambulatory Surgical Center Quality
Reporting (ASCQR) Program
416.300 Basis and scope of subpart.
416.305 Participation and withdrawal requirements under the ASCQR
Program.
416.310 Data collection and submission requirements under the ASCQR
Program.
416.315 Public reporting of data under the ASCQR Program.
416.320 Retention and removal of quality measures under the ASCQR
Program.
416.325 Measure maintenance under the ASCQR Program.
416.330 Reconsiderations under the ASCQR Program.
Authority: 42 U.S.C. 273, 1302, 1320b-8, and 1395hh.
Source: 47 FR 34094, Aug. 5, 1982, unless otherwise noted.
Subpart A_General Provisions and Definitions
Sec. 416.1 Basis and scope.
(a) Statutory basis. (1) Section 1832(a)(2)(F)(i) of the Act
provides for Medicare Part B coverage of facility services furnished in
connection with surgical procedures specified by the Secretary under
section 1833(i)(1) of the Act.
(2) Section 1833(i)(1)(A) of the Act requires the Secretary to
specify the surgical procedures that can be performed safely on an
ambulatory basis in an ambulatory surgical center.
(3) Sections 1833(i)(2)(A) and (D) and 1833(a)(1)(G) of the Act
specify the amounts to be paid for facility services furnished in
connection with the specified surgical procedures when they are
performed in an ASC.
(4) Section 1833(i)(2)(C) of the Act provides that if the Secretary
has not updated amounts for ASC facility services furnished during a
fiscal year through 2005 or a calendar year beginning with 2006, the
amounts shall be increased by the percentage increase in the Consumer
Price Index for all urban consumers as estimated by the Secretary for
the 12-month period ending with the midpoint of the year involved,
except that, in fiscal year 2005, the last quarter of calendar year
2005, and each of the calendar years 2006 through 2009, the increase
shall be zero percent.
(5) Section 1833(i)(2)(E) of the Act provides that, with respect to
surgical procedures furnished on or after January 1, 2007, and before
the effective date of the implementation of a revised payment system,
the payment amount shall be the lesser of the ASC payment rate
established under section 1833(i)(2)(A) of the Act or the prospective
payment rate for hospital outpatient department services established
under section 1833(t)(3)(D) of the Act. The lesser payment amount shall
be determined prior to application of any geographic adjustment.
(b) Scope. This part sets forth--
[[Page 227]]
(1) The conditions that an ASC must meet in order to participate in
the Medicare program;
(2) The scope of covered services; and
(3) The conditions for Medicare payment for facility services.
[56 FR 8843, Mar. 1, 1991; 56 FR 23022, May 20, 1991, as amended at 71
FR 68226, Nov. 24, 2006]
Sec. 416.2 Definitions.
As used in this part:
Ambulatory surgical center or ASC means any distinct entity that
operates exclusively for the purpose of providing surgical services to
patients not requiring hospitalization and in which the expected
duration of services would not exceed 24 hours following an admission.
The entity must have an agreement with CMS to participate in Medicare as
an ASC, and must meet the conditions set forth in subparts B and C of
this part.
ASC services means, for the period before January 1, 2008, facility
services that are furnished in an ASC, and beginning January 1, 2008,
means the combined facility services and covered ancillary services that
are furnished in an ASC in connection with covered surgical procedures.
Covered ancillary services means items and services that are
integral to a covered surgical procedure performed in an ASC as provided
in Sec. 416.164(b), for which payment may be made under Sec. 416.171
in addition to the payment for the facility services.
Covered surgical procedures means those surgical procedures
furnished before January 1, 2008, that meet the criteria specified in
Sec. 416.65 and those surgical procedures furnished on or after January
1, 2008, that meet the criteria specified in Sec. 416.166.
Facility services means for the period before January 1, 2008,
services that are furnished in connection with covered surgical
procedures performed in an ASC, and beginning January 1, 2008, means
services that are furnished in connection with covered surgical
procedures performed in an ASC as provided in Sec. 416.164(a) for which
payment is included in the ASC payment established under Sec. 416.171
for the covered surgical procedure.
[56 FR 8843, Mar. 1, 1991; 56 FR 23022, May 20, 1991, as amended at 71
FR 68226, Nov. 24, 2006; 72 FR 42544, Aug. 2, 2007; 73 FR 68811, Nov.
18, 2008]
Subpart B_General Conditions and Requirements
Sec. 416.25 Basic requirements.
Participation as an ASC is limited to facilities that--
(a) Meet the definition in Sec. 416.2; and
(b) Have in effect an agreement obtained in accordance with this
subpart.
[56 FR 8843, Mar. 1, 1991]
Sec. 416.26 Qualifying for an agreement.
(a) Deemed compliance. CMS may deem an ASC to be in compliance with
any or all of the conditions set forth in subpart C of this part if--
(1) The ASC is accredited by a national accrediting body, or
licensed by a State agency, that CMS determines provides reasonable
assurance that the conditions are met;
(2) In the case of deemed status through accreditation by a national
accrediting body, where State law requires licensure, the ASC complies
with State licensure requirements; and
(3) The ASC authorizes the release to CMS, of the findings of the
accreditation survey.
(b) Survey of ASCs. (1) Unless CMS deems the ASC to be in compliance
with the conditions set forth in subpart C of this part, the State
survey agency must survey the facility to ascertain compliance with
those conditions, and report its findings to CMS.
(2) CMS surveys deemed ASCs on a sample basis as part of CMS's
validation process.
(c) Acceptance of the ASC as qualified to furnish ambulatory
surgical services. If CMS determines, after reviewing the survey agency
recommendation and other evidence relating to the qualification of the
ASC, that the facility meets the requirements of this part, it sends to
the ASC--
(1) Written notice of the determination; and
(2) Two copies of the ASC agreement.
[[Page 228]]
(d) Filing of agreement by the ASC. If the ASC wishes to participate
in the program, it must--
(1) Have both copies of the ASC agreement signed by its authorized
representative; and
(2) File them with CMS.
(e) Acceptance by CMS. If CMS accepts the agreement filed by the
ASC, returns to the ASC one copy of the agreement, with a notice of
acceptance specifying the effective date.
(f) Appeal rights. If CMS refuses to enter into an agreement or if
CMS terminates an agreement, the ASC is entitled to a hearing in
accordance with part 498 of this chapter.
[56 FR 8843, Mar. 1, 1991]
Sec. 416.30 Terms of agreement with CMS.
As part of the agreement under Sec. 416.26 the ASC must agree to
the following:
(a) Compliance with coverage conditions. The ASC agrees to meet the
conditions for coverage specified in subpart C of this part and to
report promptly to CMS any failure to do so.
(b) Limitation on charges to beneficiaries. \1\ The ASC agrees to
charge the beneficiary or any other person only the applicable
deductible and coinsurance amounts for facility services for which the
beneficiary--
---------------------------------------------------------------------------
\1\ For facility services furnished before July 1987, the ASC had to
agree to make no charge to the beneficiary, since those services were
not subject to the part B deductible and coinsurance provisions.
---------------------------------------------------------------------------
(1) Is entitled to have payment made on his or her behalf under this
part; or
(2) Would have been so entitled if the ASC had filed a request for
payment in accordance with Sec. 410.165 of this chapter.
(c) Refunds to beneficiaries. (1) The ASC agrees to refund as
promptly as possible any money incorrectly collected from beneficiaries
or from someone on their behalf.
(2) As used in this section, money incorrectly collected means sums
collected in excess of those specified in paragraph (b) of this section.
It includes amounts collected for a period of time when the beneficiary
was believed not to be entitled to Medicare benefits if--
(i) The beneficiary is later determined to have been entitled to
Medicare benefits; and
(ii) The beneficiary's entitlement period falls within the time the
ASC's agreement with CMS is in effect.
(d) Furnishing information. The ASC agrees to furnish to CMS, if
requested, information necessary to establish payment rates specified in
Sec. Sec. 416.120-416.130 in the form and manner that CMS requires.
(e) Acceptance of assignment. The ASC agrees to accept assignment
for all facility services furnished in connection with covered surgical
procedures. For purposes of this section, assignment means an assignment
under Sec. 424.55 of this chapter of the right to receive payment under
Medicare Part B and payment under Sec. 424.64 of this chapter (when an
individual dies before assigning the claim).
(f) ASCs operated by a hopsital. In an ASC operated by a hospital--
(1) The agreement is made effective on the first day of the next
Medicare cost reporting period of the hospital that operates the ASC;
and
(2) The ASC participates and is paid only as an ASC.
(3) Costs for the ASC are treated as a non-reimbursable cost center
on the hopsital's cost report.
(g) Additional provisions. The agreement may contain any additional
provisions that CMS finds necessary or desirable for the efficient and
effective administration of the Medicare program.
[47 FR 34094, Aug. 5, 1982, as amended at 51 FR 41351, Nov. 14, 1986; 56
FR 8844, Mar. 1, 1991; 74 FR 60680, Nov. 20, 2009]
Sec. 416.35 Termination of agreement.
(a) Termination by the ASC--(1) Notice to CMS. An ASC that wishes to
terminate its agreement must send CMS written notice of its intent.
(2) Date of termination. The notice may state the intended date of
termination which must be the first day of a calendar month.
(i) If the notice does not specify a date, or the date is not
acceptable to CMS, CMS may set a date that will not be more than 6
months from the date on the ASC's notice of intent.
[[Page 229]]
(ii) CMS may accept a termination date that is less than 6 months
after the date on the ASC's notice if it determines that to do so would
not unduly disrupt services to the community or otherwise interfere with
the effective and efficient administration of the Medicare program.
(3) Voluntary termination. If an ASC ceases to furnish services to
the community, that shall be deemed to be a voluntary termination of the
agreement by the ASC, effective on the last day of business with
Medicare beneficiaries.
(b) Termination by CMS--(1) Cause for termination. CMS may terminate
an agreement if it determines that the ASC--
(i) No longer meets the conditions for coverage as specified under
Sec. 416.26; or
(ii) Is not in substantial compliance with the provisions of the
agreement, the requirements of this subpart, and other applicable
regulations of subchapter B of this chapter, or any applicable
provisions of title XVIII of the Act.
(2) Notice of termination. CMS sends notice of termination to the
ASC at least 15 days before the effective date stated in the notice.
(3) Appeal by the ASC. An ASC may appeal the termination of its
agreement in accordance with the provisions set forth in part 498 of
this chapter.
(c) Effect of termination. Payment is not available for ASC services
furnished on or after the effective date of termination.
(d) Notice to the public. Prompt notice of the date and effect of
termination is given to the public by--
(1) The ASC, after CMS has approved or set a termination date; or
(2) CMS, when it has terminated the agreement.
(e) Conditions for reinstatement after termination of agreement by
CMS. When an agreement with an ASC is terminated by CMS, the ASC may not
file another agreement to participate in the Medicare program unless
CMS--
(1) Finds that the reason for the termination of the prior agreement
has been removed; and
(2) Is assured that the reason for the termination will not recur.
[47 FR 34094, Aug. 5, 1982, as amended at 52 FR 22454, June 12, 1987; 56
FR 8844, Mar. 1, 1991; 61 FR 40347, Aug. 2, 1996; 82 FR 38515, Aug. 14,
2017]
Subpart C_Specific Conditions for Coverage
Sec. 416.40 Condition for coverage--Compliance with State licensure law.
The ASC must comply with State licensure requirements.
Sec. 416.41 Condition for coverage--Governing body and management.
The ASC must have a governing body that assumes full legal
responsibility for determining, implementing, and monitoring policies
governing the ASC's total operation. The governing body has oversight
and accountability for the quality assessment and performance
improvement program, ensures that facility policies and programs are
administered so as to provide quality health care in a safe environment,
and develops and maintains a disaster preparedness plan.
(a) Standard: Contract services. When services are provided through
a contract with an outside resource, the ASC must assure that these
services are provided in a safe and effective manner.
(b) Standard: Hospitalization. (1) The ASC must have an effective
procedure for the immediate transfer, to a hospital, of patients
requiring emergency medical care beyond the capabilities of the ASC.
(2) This hospital must be a local, Medicare-participating hospital
or a local, nonparticipating hospital that meets the requirements for
payment for emergency services under Sec. 482.2 of this chapter.
(3) The ASC must--
(i) Have a written transfer agreement with a hospital that meets the
requirements of paragraph (b)(2) of this section; or
(ii) Ensure that all physicians performing surgery in the ASC have
admitting privileges at a hospital that
[[Page 230]]
meets the requirements of paragraph (b)(2) of this section.
[73 FR 68811, Nov. 18, 2008, as amended at 81 FR 64022, Sept. 16, 2016]
Effective Date Note: At 84 FR 51814, Sept. 30, 2019, section 416.41
was amended by revising paragraph (b)(3), effective Nov. 29, 2019. For
the convenience of the user, the revised text is set forth as follows:
Sec. 416.41 Condition for coverage--Governing body and management.
* * * * *
(b) * * *
(3) The ASC must periodically provide the local hospital with
written notice of its operations and patient population served.
Sec. 416.42 Condition for coverage--Surgical services.
Surgical procedures must be performed in a safe manner by qualified
physicians who have been granted clinical privileges by the governing
body of the ASC in accordance with approved policies and procedures of
the ASC.
(a) Standard: Anesthetic risk and evaluation. (1) A physician must
examine the patient immediately before surgery to evaluate the risk of
anesthesia and of the procedure to be performed.
(2) Before discharge from the ASC, each patient must be evaluated by
a physician or by an anesthetist as defined at Sec. 410.69(b) of this
chapter, in accordance with applicable State health and safety laws,
standards of practice, and ASC policy, for proper anesthesia recovery.
(b) Standard: Administration of anesthesia. Anesthetics must be
administered by only--
(1) A qualified anesthesiologist; or
(2) A physician qualified to administer anesthesia, a certified
registered nurse anesthetist (CRNA), or an anesthesiologist's assistant
as defined in Sec. 410.69(b) of this chapter, or a supervised trainee
in an approved educational program. In those cases in which a non-
physician administers the anesthesia, unless exempted in accordance with
paragraph (c) of this section, the anesthetist must be under the
supervision of the operating physician, and in the case of an
anesthesiologist's assistant, under the supervision of an
anesthesiologist.
(c) Standard: State exemption. (1) An ASC may be exempted from the
requirement for physician supervision of CRNAs as described in paragraph
(b)(2) of this section, if the State in which the ASC is located submits
a letter to CMS signed by the Governor, following consultation with the
State's Boards of Medicine and Nursing, requesting exemption from
physician supervision of CRNAs. The letter from the Governor must attest
that he or she has consulted with State Boards of Medicine and Nursing
about issues related to access to and the quality of anesthesia services
in the State and has concluded that it is in the best interests of the
State's citizens to opt-out of the current physician supervision
requirement, and that the opt-out is consistent with State law.
(2) The request for exemption and recognition of State laws, and the
withdrawal of the request may be submitted at any time, and are
effective upon submission.
[57 FR 33899, July 31, 1992, as amended at 66 FR 56768, Nov. 13, 2001;
73 FR 68812, Nov. 18, 2008; 79 FR 27153, May 12, 2014]
Sec. 416.43 Conditions for coverage--Quality assessment
and performance improvement.
The ASC must develop, implement and maintain an ongoing, data-driven
quality assessment and performance improvement (QAPI) program.
(a) Standard: Program scope. (1) The program must include, but not
be limited to, an ongoing program that demonstrates measurable
improvement in patient health outcomes, and improves patient safety by
using quality indicators or performance measures associated with
improved health outcomes and by the identification and reduction of
medical errors.
(2) The ASC must measure, analyze, and track quality indicators,
adverse patient events, infection control and other aspects of
performance that includes care and services furnished in the ASC.
(b) Standard: Program data. (1) The program must incorporate quality
indicator data, including patient care and other relevant data regarding
services furnished in the ASC.
[[Page 231]]
(2) The ASC must use the data collected to--
(i) Monitor the effectiveness and safety of its services, and
quality of its care.
(ii) Identify opportunities that could lead to improvements and
changes in its patient care.
(c) Standard: Program activities. (1) The ASC must set priorities
for its performance improvement activities that--
(i) Focus on high risk, high volume, and problem-prone areas.
(ii) Consider incidence, prevalence, and severity of problems in
those areas.
(iii) Affect health outcomes, patient safety, and quality of care.
(2) Performance improvement activities must track adverse patient
events, examine their causes, implement improvements, and ensure that
improvements are sustained over time.
(3) The ASC must implement preventive strategies throughout the
facility targeting adverse patient events and ensure that all staff are
familiar with these strategies.
(d) Standard: Performance improvement projects. (1) The number and
scope of distinct improvement projects conducted annually must reflect
the scope and complexity of the ASC's services and operations.
(2) The ASC must document the projects that are being conducted. The
documentation, at a minimum, must include the reason(s) for implementing
the project, and a description of the project's results.
(e) Standard: Governing body responsibilities. The governing body
must ensure that the QAPI program--
(1) Is defined, implemented, and maintained by the ASC.
(2) Addresses the ASC's priorities and that all improvements are
evaluated for effectiveness.
(3) Specifies data collection methods, frequency, and details.
(4) Clearly establishes its expectations for safety.
(5) Adequately allocates sufficient staff, time, information systems
and training to implement the QAPI program.
[73 FR 68812, Nov. 18, 2008]