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CMS Backlog Shortchanges Doctors on E-prescribing Exemptions

Medicare processing of hardship exemption applications has lagged, hitting physicians with lower pay rates despite the steps they took to prevent the penalty.

Some physicians are reporting that the Medicare payments they've received for their services in 2012 are being reduced for a failure to prescribe enough electronically in 2011, even though the doctors filed waiver requests seeking special hardship exemptions.

The Centers for Medicare & Medicaid Services could not process all hardship application requests before starting to levy the 1% penalty for noncompliant physicians in 2012, officials said. The agency said it since has approved or denied all of those exemption requests, requiring contractors to reprocess claims for physicians unfairly penalized earlier in the year.

CMS would not provide a count of how many doctors and other health professionals are being assessed the penalty, whether appropriately or not. But physicians say there has been too much confusion throughout the entire process, and many still do not know if the penalties they noticed earlier in the year will continue to apply to their Medicare rates going forward.

Physicians who prescribe electronically who did not report a minimum of 10 e-prescribing encounters on claims for eligible services between January and June 2011 received letters in February 2012 stating that the 1% penalty was being applied to their payments. But physicians filing for hardship exemptions in the fall also received the letters, which stated that the notice did not take into account whether the recipients' exemption applications had been received by a Nov. 8, 2011, deadline.

Such a letter arrived at the Saratoga Springs, N.Y., practice of otolaryngologist Robert Hughes, MD, even though he had filed for a hardship exemption in 2011. “I am suffering a 1% loss in revenue right now,” he said in mid-March.

Dr. Hughes said he e-prescribed for his patients through a regional exchange in Albany. But his patients included those with private Medicare Advantage plans, who were not counted toward the minimum requirement of 10 e-prescribing encounters, so his total fell short.

CMS created the hardship exemption process after the six-month time frame for reporting e-prescribing activity had expired. Dr. Hughes determined that he met the criteria for one of the exemptions, for physicians who had an insufficient number of eligible patients to make the minimum. However, the agency never notified him as to whether his hardship request was accepted.

Notifications of approval or denial of exemptions are the responsibility of Medicare contractors, said CMS spokesman Joseph Kuchler.

The American Medical Association has heard from numerous physicians in a similar situation to Dr. Hughes. The Association has been working with the Medicare agency to address these cases.

“The AMA pressed CMS to open up their phone lines to hear from physicians who believe that they received the 2012 Medicare e-prescribing penalty in error, and CMS agreed,” said AMA President Peter W. Carmel, MD. “Before CMS did this, many physicians contacted the AMA and complained that although they complied with the program requirements or filed for an exemption, they received a 1% payment cut in the beginning of this year.”

The AMA is urging CMS to re-evaluate the penalty timelines associated with the e-prescribing incentive program, as well as other health information technology incentive programs that are kicking in at the same time, Dr. Carmel said. The Medicare agency will penalize doctors who do not meet requirements under the Medicare physician quality reporting system and the electronic health record incentive program in 2015. CMS also will apply a value-based payment modifier for some physicians that year that could reduce their pay even more.

However, these 2015 programs will measure compliance based on Medicare claims in 2013 or 2014—effectively moving up the deadlines. The AMA and dozens of other physician organizations sent CMS acting Administrator Marilyn Tavenner a March 28 letter urging the agency to make changes.

“In the wake of this onslaught of overlapping regulatory mandates and reporting requirements, [the administration] has a responsibility to review all of these programs and take the opportunity to ease the burdens on physician practices,” the letter states. “We urge that CMS, in the physician fee schedule proposed rule for calendar year 2013, discontinue its plans to backdate penalty programs, while better synchronizing the incentive and penalty programs so that physicians who successfully participate in one program are protected from penalties associated with the other programs.”

For now, Medicare has no official appeals process for the e-prescribing penalty program. However, CMS has expressed a willingness to work with individual physicians on concerns with the payment adjustments.

Exemption filing period for 2013 open
CMS now is accepting hardship requests from physicians looking to avoid the 2013 e-prescribing penalty, which will grow to 1.5%. The agency reopened the application website on March 1, and physicians seeking waivers will have until June 30 to file their requests.

Physicians who prescribe electronically for at least 10 eligible patient encounters before the end of June will avoid the 2013 penalty. Physicians who earned an e-prescribing bonus for filing at least 25 eligible e-prescriptions in 2011 also will not be penalized in 2013. CMS has not yet paid those awards, but doctors can access feedback reports that give an idea of whether they met the 2011 incentive program requirements for the bonuses. Each physician's report contains an analysis of the claims he or she filed for services provided between January and October 2011, indicating whether he or she was on track toward earning a bonus.

A request for a feedback report, and an application for a hardship exemption, can be filed online.




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