This Week – February 11, 2011

This Week in Washington DC:

  • CMS Makes Announcement on Reprocessing Medicare Claims
  • CMS Reminder: Medicare eRx Payment Penalty in 2012 Linked to 2011 Participation
  • ACG Clarification on 2011 Medicare Reimbursement and 2011 Conversion Factor
  • Health Reform Lawsuit Update

CMS to Reprocess Certain Medicare Claims
The Centers for Medicare and Medicaid Services (CMS) announced on Tuesday that it will begin reprocessing Medicare claims in the upcoming weeks for those providers affected by various changes in Medicare payment policy and sustainable growth rate (SGR) moratorium lapses throughout 2010. Providers impacted by various changes in 2010 do not have to resubmit claims as CMS contractors will reprocess these claims automatically. However, those providers who had submitted claims with lower charges than the final 2010 fee schedule amount will be forced to resubmit the claim – i.e. submitted a claim with a negative SGR update during 2010 instead of holding onto the claim while Congress addressed another SGR extension. In these circumstances, providers will need to request a “manual reopening/adjustment” form from their Medicare contractor. Providers will also be given more time than the usual 1 year limitation to re-file these claims.

Various provisions in the Patient Protection and Affordable Care Act (now known as the Affordable Care Act or ACA) impacted Medicare provider reimbursement in 2010. At the same time, Congress dealt with multiple SGR moratoriums to avoid the 20-25% Medicare reimbursement cut originally slated for 2010. Due to these various adjustments and retroactive changes, CMS notes that a large volume of claims will need to be reprocessed.

ACG is monitoring these developments and will update membership as the College receives further guidance from CMS.

Medicare Electronic Prescribing (eRx) Incentive Program Payment Penalty Looms
CMS also reminded medical organizations this week that providers should participate in the Medicare eRx Incentive Program as soon as possible to avoid a payment penalty in 2012 and 2013. In November 2010, CMS announced that providers not successfully demonstrating that they are electronic prescribers under the eRx Program will be subject to a 1% Medicare Part B payment penalty beginning 2012. What’s more, CMS will determine that payment penalty based on what the provider does in early 2011.

The Medicare Improvements for Patients and Providers Act of 2008 (MIPPA) authorized a Medicare eRx Incentive Program to promote the use of eRx systems. To avoid this looming payment penalty, the GI clinician should make sure that if he or she is eligible to participate in the Medicare eRx Incentive Program to start participating as soon as possible.

Do I qualify for the Medicare eRx program… and the reimbursement cut?
The list of “eligible eRx professionals” in the field of gastroenterology include: a doctor of medicine, a nurse practitioner, a physician assistant, or a clinical nurse specialist.

These eligible professionals must also use a “qualified eRx system.” There are two types of eRx systems: a system for electronic prescribing purposes only (a standalone system) or an electronic health record (EHR) with eRx functionality. Either system will work as long as the system is able to do the following:

  • Generate a complete medication list that incorporates data from pharmacies and benefit mangers (if available)
  • Select medications, prints prescriptions, and transmits prescriptions electronically using the applicable standards, and warn the prescriber of possible undesirable or unsafe situations
  • Provide information on lower-cost, therapeutically-appropriate alternatives; and
  • Provide information on formulary or tiered formulary medications, patient eligibility, and authorization requirements received electronically from the patient’s drug plan.

Lastly, at least 10% of an eligible professional’s total Medicare Part B fee for service (FFS) charges in a reporting period must be comprised of the following codes (these codes make up the denominator):

90801 90808 96150 99204 99215 99309 99326 99337 99348
90802 90809 96151 99205 99304 99310 99327 99341 99349
90804 90862 96152 99211 99305 99315 99328 99342 99350
90805 92002 99201 99212 99306 99316 99334 99343 G0101
90806 92004 99202 99213 99307 99324 99335 99345 G0108
90807 92014 99203 99214 99308 99325 99336 99347 G0109

Getting Started
A successful electronic prescriber must report at least 25 unique prescriptions. There is no registration or initial sign-up required. The provider will report one of the above mentioned codes on the Medicare claims form, then a “G8553” modifier code on the form which will alert Medicare claims processors that you are reporting for the eRx Incentive Program. It is important to note that the “G8553” code must be submitted with a line-tem charge of $0.00 on the claims form. Providers will receive a standard “Remittance Advice” from the claims processor reading “This procedure code is not payable. It is for reporting/information purposes only.”

To avoid a payment penalty in 2012, a provider must report at least 10 unique eRx events (can be the same patient) from January – June 2011 for those Medicare patients and relevant denominator codes. Any provider successfully submitting 25 unique eRx events in 2011 (January – December) will also be considered exempt from the 2013 payment penalty. However, it is important to note that providers must still report 10 unique events from January – June 2011 to be exempt from the 2012 payment penalty. It is possible that providers could receive the 1% incentive payment in 2011 as well as the 1% payment penalty in 2012.

Providers must also have at least 100 eligible visits containing the denominator codes before being assessed a penalty. CMS also provides for “hardship exemptions” on a case-by-case basis that will exempt providers from the 2012 payment penalty. For 2012, the following circumstances would constitute a hardship:

  • The provider practices in a rural area with limited high-speed internet access; or
  • The provider practices in an area with limited available pharmacies that can receive electronic prescriptions

Providers wishing to demonstrate a “hardship exemption” are required to report a hardship exemption G-code “G8642” (limited high-speed intent access) or “G8643” (limited available pharmacies) on at least one Medicare claims form with one of the denominator codes from January – June 2011.

Please contact ACG with any question relating to the Medicare eRx Incentive Program.

ACG Members Should Not Expect Lower Medicare Reimbursement in 2011
ACG has learned of reports alleging Medicare reimbursement will be lower in 2011 due to a change in the 2011 Medicare fee schedule conversion factor. ACG has been assured by the American Medical Association (AMA), CMS, and others that ACG members will not unexpectedly experience a 7% reimbursement cut as a result of this change. While CMS did lower the Medicare conversion factor, CMS increased the relative value units (RVUs) used to calculate all Medicare physician fee schedule rates. CMS was forced to lower the conversion factor as a result of reweighting these RVUs due to budget neutrality requirements.

Please contact ACG if your practice experiences an unexpected reimbursement cut due to these changes.

Health Reform Lawsuit Update: Virginia Petitions U.S. Supreme Court to Hear Health Care Law Challenge
Citing “imperative national importance,” Virginia Attorney General Kenneth Cuccinelli on Wednesday formally filed a request that the U.S. Supreme Court hear the health care law challenge instead of letting the lawsuits go through the appellate process. In December, a federal judge in Virginia ruled unconstitutional the health care law’s mandate to purchase health insurance. The 4th Circuit Court of Appeals, based in Richmond, VA, will consider the federal government’s appeal. A federal district court judge in Florida also ruled the entire health care law unconstitutional last month in the multi-state challenge. The government is expected to appeal this ruling as well.

Legal experts do not expect the lawsuits to bypass the traditional appellate process and head directly to the Supreme Court. According to news reports this week, legal experts also agree that when the Supreme Court does rule on the health care law it is unlikely the Court will strike the entire law down despite the absence of a severability clause.

ACG will continue to update its membership on the latest developments in the health reform law challenges going through the courts.

Please stay tuned for further updates. Please also share and discuss your thoughts with fellow ACG members on the ACG GI Circle. To login and share your comments, visit If you have not yet activated your ACG GI Circle account, please email us at

Contact Brad Conway, VP Public Policy, with any questions or for more information.

Brad Conway