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Medicare’s Patient Evaluation Proposal Could Cut Doctor Pay

July 25, 2018, 8:04 PM

Physicians who provide complex care say Medicare’s plan to condense the payment structure for patient evaluation and management could hurt them.

This proposal “means that physicians who provide care for a disproportionate number of high-acuity patients would consistently, and unfairly, receive underpayment,” Tom Nickels, executive vice president of the American Hospital Association, said in a statement.

The Centers for Medicare & Medicaid Services’ July 12 proposal would reduce the payment system for evaluation and management care from five levels to two. The first level, for nonphysician services, would not change under the proposal. The new second level would replace four earlier levels, which involved increasingly complex levels of care by doctors and progressively higher payment rates.

Medicare payment for new patients currently ranges from $76 for a level 2 visit to $211 for a level 5 visit. The proposal would condense that into one rate of $135. Current payment for established patients ranges from $22 for a level 2 visit to $148 for a level 5 visit, and would be $93 under the proposal.

“I don’t think the sky is falling, even though it is concerning,” Brian Outland, director of regulatory affairs at the American College of Physicians, told Bloomberg Law July 23.

Burden on Practices

Patients with complex needs require more time and attention, and thus, more resources, from doctors, Outland said.

The CMS’s proposal could potentially be a financial burden on a practice, Outland said, and could cause a physician shortage. If doctors decide they’re not willing to potentially be paid less, they could stop accepting Medicare or retire, Outland said.

“I’ve heard some concern about the impact of these changes on physicians who see lots of complex cases, which is a particular concern to those of us at academic medical centers,” Lloyd Minor, dean of the Stanford University School of Medicine, said in a statement to Bloomberg Law. “CMS’ answer indicated that they’ve analyzed this risk and believe the impact to be negligible.”

Comments are due Sept. 10. If made final, the changes would go into effect in January 2019.

Outland said he is also concerned about the speed with which the CMS wants to enact this policy and would like the agency to take more time to implement it. The final rule would be released in October or November, which would only give physicians up to two months to prepare for these changes to go into effect.

Additional Payments

The proposal would recognize the additional time spent on prolonged evaluation and management visits by including add-on payments and prolonged visit payments, a CMS spokesperson told Bloomberg Law.

This proposal “would result in a payment of MORE than they are being paid now for the most highly paid visits,” CMS Administrator Seema Verma said in a tweet July 23.

Providers would receive an add-on payment of $14 for visits associated with endocrinology, rheumatology, hematology/oncology, urology, neurology, obstetrics/gynecology, allergy/immunology, otolaryngology, cardiology, or interventional pain management-centered care.

Doctors would also be paid $67 for every additional 30 minutes of care provided after the base evaluation.

The proposal would allow doctors “to use time as the governing factor in selecting visit level and documenting the E/M visit, regardless of whether counseling or care coordination dominate the visit,” according to a statement from the CMS.

For example, care at level 5 under the current payment system for a new patient would result in a payment of $211. Under the proposed rule, there would be a payment of $134 for the base evaluation, $14 of an add-on payment, and $67 for each additional 30 minutes of care provided, a total of $215.

Rheumatology, dermatology, and podiatry would have a decrease in payment of at least 3 percent, not including any potential payment for prolonged care, according to the CMS’s estimates. Obstetrics/gynecology and nurse practitioners would have an increase in payment of at least 3 percent, according to the estimates. Other specialties would see either no change in their payment or a change of less than 3 percent.

“There’s no reason why the goals of reduced administrative burden and fair reimbursement for complex care should be in conflict, and I believe CMS is committed to both,” Minor said.

To contact the reporter on this story: Shira Stein in Washington at

To contact the editor responsible for this story: Brian Broderick at