The final rule released by the Centers for Medicare & Medicaid Services (CMS) summarizes the 2007 impact of the following changes on the various physician specialties: work and practice expense relative value units (RVUs), the Deficit Reduction Act adjustments for imaging services payments, and the estimated 5% reduction in the Medicare physician fee schedule. The combined impact of these changes leads to a 2% reduction of allowed charges for hematology/oncology and a 5% reduction for radiation oncology. The rule takes effect on January 1, 2007.
These decreases occurred despite an increase in the value of the work component of several evaluation and management services. The work and practice expense RVU changes alone result in a 3% increase in allowed charges for hematology/oncology, and a 1% rise for radiation oncology, in 2007. Adding in the adjustments to imaging services payments led to a 0% increase (ie, no change) for radiation oncology, and did not affect the 3% increase for hematology/oncology. Incorporating the 5% reduction in the Medicare physician fee schedule produces the reduction for both fields.
Oncologists are not alone in taking a loss under this rule, however. Only 4 of 54 specialties listed in the CMS rule stayed the same or showed an increase after inclusion of the 5% physician fee reduction, compared to 26 of 54 who met those criteria before consideration of the 5% fee reduction.
In other news, CMS took no action on how to allocate price concessions across drugs sold under bundling arrangements in calculating the average sales price (ASP). The agency had sought comment about how bundling affects the ASP calculation and the sales of Part B drugs but indicated in the rule that “we do not yet fully understand the variety of bundling arrangements that exist.” As Practice Manager Insider board member Larry Oday said, “They’ve kicked the can down the road.”
This does not mean that CMS has passed on this issue. The rule also states that CMS may provide “more specific guidance in the future.” Said Oday, a former official of CMS’ predecessor agency, “This is not over.”
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