Read the latest medical news for the San Bernardino County area.

Noridian announces new audits

Noridian, California's Medicare administrative contractor, has announced it will be conducting service-specific targeted audits of procedure codes 99205 and 99233 when rendered by providers with specific specialties:

  • 99205 performed by cardiology (Centers for Medicare and Medicaid Services specialty designation 06) and pulmonary (29)
  • 99233 performed by internal medicine (11) and hematology/oncology (83)
Noridian conducts these targeted reviews based on data analysis. An analysis of these procedure codes, when performed by physicians in these specialties, indicated a higher utilization by California providers when compared to national claim payment ratios for the same services by the same specialties.

These reviews are conducted on a pre-payment basis, meaning Noridian will notify physicians selected for claim audits through the additional documentation request (ADR) process before payment is made. Upon receipt of a request for information, practices must submit all applicable documentation for each claim with a copy of the ADR as a cover sheet. Records should be mailed (hardcopy or CD) or faxed to Noridian within 45 days of receipt, or a claim denial will result.

More information on the ADR process can be found here. Documentation that may support the services billed includes:

  • Legible copy of the patient's medical record for listed date(s) of service
  • Legible physician signature
  • Consultation reports
  • Physician progress notes
  • Diagnostic test results/reports, including imaging reports if applicable
  • Any other documentation to support the CPT Code that was billed
For more assistance on signature and documentation requirements, refer to the Documentation Guidelines for Medicare Services on Noridian’s website.

Noridian will review the documentation submitted within 30 days of receipt. No letters will be sent on the outcome of each individual claim. The claim decisions will be reflected in the remittance advice and may be appealed through the normal appeal process, if unfavorable.

When the audit is complete, Noridian will analyze the results and determine if any subsequent actions are necessary. The results will be posted to Noridian’s JE Part B website.

Spending for federal health programs is expected to remain 'modest' over the next 10 years

Total health care spending growth for federal health programs such as Medicare and Medicaid is expected to average 5.8 percent in aggregate over 2014-2024, according to a report published by the Centers for Medicare & Medicaid Services (CMS) Office of the Actuary. The authors noted that this rate of growth is still substantially lower than the 9 percent average rate seen in the three decades before 2008.  

“Growth in overall health spending remains modest even as more Americans are covered, many for the first time. Per-capita spending and medical inflation are all at historically very modest levels,” said CMS Acting Administrator Andy Slavitt.

In 2014, health spending in the United States was projected to have reached $3.1 trillion, or $9,695 per person, and to have increased by 5.5 percent from the previous year.

With new expensive specialty drugs hitting the market, prescription drug spending increased 12.6 percent in 2014, the highest growth since 2002. While more people are getting coverage, annual growth in per-enrollee expenditures in 2014 for private health insurance (5.4 percent), Medicare (2.7 percent) and Medicaid (-0.8 percent) remained slow in historical terms.

Other findings from the report included:

  • Medical price inflation averaged 1.4 percent nationally – even with the implementation of the Affordable Care Act (ACA). Hospital and physician and clinical services, which make up the largest portions of medical prices, also increased slowly at 1.4 and 0.5 percent, respectively.

  • Premium growth in private health plans is projected to slow to 2.8 percent in 2015, reflecting the expectation of somewhat healthier marketplace enrollees and the increasing prevalence of high-deductible health plans offered by employers. The authors projected that per-capita premium growth would remain below 6 percent through the end of the projection period (2024).

  • Approximately 19.1 million additional people are expected to enroll in Medicare over the next 11 years as more members of the Baby Boomer generation reach the Medicare eligibility age.

  • In 2014, per capita Medicaid spending was projected to have decreased by 0.8 percent as the newly enrolled were expected to be somewhat healthier than those who were enrolled previously. Overall spending, however, is projected to have increased by 12 percent in 2014 as a result of a 12.9-percent increase in enrollment related to the ACA coverage expansion.
  • While the newly enrolled Medicaid adult population is projected to cost more than adults who were enrolled in the program in 2013, the authors expect that per-enrollee costs will fall below the costs of other adults after pent-up demand for medical care is satisfied.
  • The insured rate is expected to rise from 86 percent to 92.4 percent as the number of uninsured persons is projected to fall by 18 million over the next 11 years.

  • With increases in coverage, the share of health expenses that Americans pay out-of-pocket is projected to decline from 11.6 percent in 2013 to 10 percent in 2024.
Click here to read the report. Read the article published in Health Affairs here.

CMS releases proposed 2016 Medicare physician fee schedule

The Centers for Medicare and Medicaid Services (CMS) recently released the 2016 proposed Medicare physician payment rule. The rule reflects the 0.5 percent increase in payment as of July 1, 2015, and the additional 0.5 percent increase in payment on January 1, 2016, recently adopted by Congress. Overall, Medicare will pay physicians nearly $700 million more in 2016 than they will have paid in 2015.

Most notable in the payment rule is CMS’ proposal to pay for advance care planning and end-of-life counseling. The fee schedule would establish two new codes to cover early conversations between patients and their physician about care options. These codes were recommended by the American Medical Association (AMA) Relative Value Scale Update Committee (RUC). The codes include discussion before an illness progresses and during the course of treatment so patients can make decisions about appropriate treatment for their personal situation. One code would cover the first 30 minutes and the other would cover additional 30-minute blocks of time. AMA and the California Medical Association (CMA) have been pushing CMS to cover such services.

CMS is seeking comments on the 2019 implementation of the new Medicare payment systems recently adopted by Congress as part of the permanent repeal of the sustainable growth rate (SGR) formula. The agency also noted its strong support for promoting primary care services and is soliciting comments on potential coverage of collaborative care services and an expansion of the Comprehensive Primary Care initiative. The proposal also includes an expansion of payment for telehealth services mainly for in-home treatments for end-stage renal disease.

There are numerous changes to the relative values of services – many recommended by the AMA RUC. Most notably, payment for gastroenterology services will be reduced 5 percent, with colon and rectal surgery reduced by 1 percent. Organized medicine is fighting many of these changes.

Other notable provisions of the rule include:

  • Myriad changes to the Accountable Care Organization Shared-Savings program, the Physician Quality Reporting System (PQRS) and the value-based payment modifier, which will soon apply to all physicians who bill under a tax identification number.
  • CMS will no longer require physicians who opt out of the Medicare program to notify Medicare on an annual basis.
  • New appropriate use criteria for advanced diagnostic imaging mainly based on recommendations from the related specialty societies.
  • Some new exceptions to physician self-referral laws.
The overall payment impact by specialty can be found on page 711 of the rule. Please note that these payments do not account for adjustments made by PQRS, the value-based payment modifier or meaningful use.

CMS is also updating the Geographic Adjustment Factors for all localities nationwide. California will see increases of 0.1 to 0.3 percent. Please note that starting in 2017, California localities will move to Metropolitan Statistical Areas due to the CMA-sponsored geographic practice cost index legislation; there will be larger payment increases to the urban counties currently within the "Rest of California" locality.

AMA and CMA are carefully analyzing the multitude of changes to the physician payment system and will be submitting extensive comments.

Contact: Elizabeth McNeil, (800) 786-4262(800) 786-4262 FREE FREE or

CMS to begin provider reimbursement for end-of-life care

On July 8, the Centers for Medicare & Medicaid Services (CMS) released the first proposed update to the Medicare physician payment schedule since the repeal of the sustainable growth rate (SGR) formula through the Medicare Access and Children’s Health Insurance Plan (CHIP) Reauthorization Act of 2015. One of the biggest changes in the CMS proposal is the assignment of codes to pay providers for end-of-life consultations. In addition the department would make advance care planning “an optional element” of a beneficiary's annual wellness visit.

The American Medical Association (AMA) lauded CMS for the advance care planning proposal. “The proposed Medicare payment rule affirms the need to support conversations between patients and physicians to establish and communicate the patient’s wishes in responding to various medical situations,” said AMA president-elect Andres Gurman, M.D.

As far as general reimbursement of Medicare visits, the document includes a 0.5 percent overall increase in Medicare reimbursement in 2016 for all providers.

The release of the rule triggers a 60-day comment period by stakeholders and the public. CMS is accepting public comments on the proposed rule until September 8, 2015. A final rule will be published this fall.

Click here for a fact sheet on the proposed rule. The full rule will be published soon in the Federal Register.

The California Medical Association is reviewing the proposed rule and will provide additional details and comments in the future.

CMS announces changes to make Medicare ICD-10 transition less disruptive for physicians

The Centers for Medicare & Medicaid Services (CMS) announced that it will provide a one-year grace period during which it will allow for flexibility in the claims payment, auditing and quality reporting processes as the medical community gains experience using the new ICD-10 code set. The ICD-10 implementation date of October 1, 2015, has not changed.

The changes announced include:

Claim denials: Medicare review contractors will not deny claims based solely on the specificity of the ICD-10 diagnosis code as long as a valid code from the right family of codes is used. Moreover, physicians will not be subject to audits as a result of ICD-10 coding mistakes during the grace period.

Quality reporting: Physicians also will not be penalized under the quality reporting programs for errors related to the additional specificity of the ICD-10 diagnosis code, again as long as a code from the correct family of codes is used.

Advance payments: If Medicare contractors are unable to process claims within established time limits because of administrative problems, such as contractor system malfunction or implementation problems, advance payment may be available to keep resources flowing to physician practices.

ICD-10 communication center: CMS will set up a communication center to monitor the implementation of ICD-10 in an effort to quickly identify and resolve issues related to the transition. As part of the center, CMS will have an ICD-10 ombudsman to help receive and triage physician and provider issues.

These provisions are a culmination of organized medicine's efforts to convince CMS of the need for a transition period to avoid financial disruptions during this time of tremendous change. The California Medical Association (CMA) has been working closely with the American Medical Association (AMA) and other medical associations, urging CMS to help mitigate the impact of the transition. Most recently, CMA, AMA and other large state medical associations (New York, Texas and Florida), met with CMS and Congressional leadership, urging them to support a two-year grace period during which physicians would not have claims delayed, denied or subject to audits because of simple ICD-10 errors.

ICD-10 education and training available

Recognizing that health care providers need help with the transition, CMS, AMA and CMA are also working to make sure physicians and other providers are ready for the October 1 transition to the new ICD-10 code sets. CMS and AMA will be offering webinars, on-site training, educational articles and national provider calls to help physicians and other health care providers prepare for the transition. For more information, see CMS's ICD-10 provider page and AMA's ICD-10 web page.

CMA, in partnership with its local county medical societies and the California Medical Group Management Association, is offering two-day ICD-10 code set seminars around the state. The two-day boot camps include 16 hours of intensive general ICD-10 code set training, along with hands-on coding exercises. To view the available dates and locations, visit the CMA event calendar. For the latest ICD-10 news and updates, see CMA's ICD-10 resource page and visit AMA Wire.

Physicians should be aware the Medicare claims processing systems will not have the capability to accept ICD-9 codes for dates of services after September 30, 2015, nor will they be able to accept claims for both ICD-9 and ICD-10 codes.

Slight increase to Medicare reimbursement rates effective as of July 1

A 0.5 percent physician payment increase will go into effect for dates of service from July 1 through December 31, 2015. This mid-year increase is a result of the Medicare Access and CHIP Reauthorization Act. The Centers for Medicare & Medicaid Services released the updated RVU files reflecting the payment increase and new conversion factor, $35.9335 (previously $35.7547).

Noridian, the Medicare Administrative Contractor for California, has posted the new fee schedule that will be in effect from July 1 through December 31, 2015. There will be an additional 0.5 percent increase on January 1, 2016.

CMA supports bill to eliminate RAC incentives that cause punitive and burdensome auditing

The California Medical Association (CMA) has announced its support of a bill introduced in Congress on May 22 that would reform the Medicare Recovery Audit Contractors (RAC) system. It is titled the Fair Medical Audits Act of 2015 and was introduced by North Carolina Congressman George Holding.

The Medicare Prescription Drug, Improvement, and Modernization Act of 2003 established the Medicare RAC program to combat fraud and waste in the Medicare system. Initially launched in 2005 as a demonstration project in three states (California, Florida and New York), the Centers for Medicare and Medicaid Services (CMS) in 2007 ordered the nationwide expansion of the RAC program by January 1, 2010.

Other provisions of the Fair Medical Audits Act of 2015 would establish penalties on RAC contractors for incorrect audit findings; require the use of qualified audit professionals, including the use of physicians of the same specialty and subspecialty to conduct medical necessity reviews; and require the use of statistically sound extrapolation formulas. The bill only allows RAC to recover back two years instead of four years. The bill would also cut down on the need for audits by allowing payments to RACs for education programs to providers on commonly found billing and coding errors and correct coding. The bill would also require that RACs give a 90-day advance notice of audits based on overutilization of codes. Most important, it would not allow the RACs to collect physician overpayments until the appeals process has been finalized.

The California Medical Association (CMA) has been working long and hard to end the punitive practices of these RAC audits and feels that the legislation addresses many concerns that physicians have with regard to the extraordinary lack of transparency and expensive, time-consuming and often unfair processes that plague the current Medicare audit program. A CMS-authored study found that “as of March 2010, an astonishing 64.4 percent of appealed RAC re-openings resulted in decisions favorable to the provider.”

“The fact that more than half of all RAC audits are overturned by an administrative law judge when a physician appeals the findings tells CMA that something is drastically wrong with the incentives in the program,” said CMA President, Luther F. Cobb, M.D.

The bill ensures due process for physicians in the Medicare program. The education component alone will save Medicare program resources. It will protect access to care by ensuring that physicians are treated fairly and that they remain in the Medicare program.

Click here to read a summary of the bill.

Contact: Elizabeth McNeil, (800) 786-4262, or

California Medical Association supports the Fair Medical Audits Act of 2015

The California Medical Association (CMA) issued a strong endorsement for the “Fair Medical Audits Act of 2015,” introduced today by U.S. Representative George Holding of North Carolina. The legislation addresses many concerns that physicians have with regard to the extraordinary lack of transparency and expensive, time-consuming and often unfair processes that plague the current Medicare audit program.
Representative Holding declared it time to fix the broken audit program: “Put simply, patients achieve the best health outcomes when practicing physicians do just that – practice medicine. My bill will bring transparency and fairness to the audit process so doctors can spend more time caring for their patients and less time proving their innocence. Medicare frauds must be found and severely punished, but not at the cost of the independent practice of medicine.”
Currently, Medicare pays recovery audit contractors (RAC) on a contingency basis to find overpayments to health care providers, providing these contractors with undue monetary incentives to audit doctors. This legislation would establish incentives for RACs to make more accurate audit findings and increase educational efforts to help physicians avoid common mistakes.  Since its inception in 2006, CMA has worked closely with the Physicians Advocacy Institute to advocate for more fair and transparent medical audits.  
CMA President Luther F. Cobb, M.D., lauded the legislation, noting: “It is time to address fundamental problems that have contributed to the backlog of audit appeals and caused a great deal of unnecessary expense and confusion for physicians in California.”
Robert W. Seligson, President of the Physicians Advocacy Institute and EVP/CEO of the North Carolina Medical Society, also hailed the proposal, stating, “Physicians and their advocates across the nation commend Congressman Holding for his leadership on this critically important issue.”
Representative Holding is a member of the House Ways and Means Committee, which has jurisdiction to consider legislation to reform the RAC program.
For more information, please contact CMA’s Molly Weedn at (916) 551-2069, or PAI Executive Vice President Kelly Kenney at (312) 543-7955 or

California seniors' state of health ranks 29th in national health study

According to a study released June 20 from America’s Health Rankings, California’s seniors have decreased exercising in the past two years, have begun drinking more alcohol and are experiencing more mental health issues.

Over the past two years, California’s senior population decreased exercising and dropped stopped from a national ranking of 18th in the nation to 29th -- this according to a study conducted by the United Health Foundation, a nonprofit arm of the United Health Group, which also owns the insurer United Healthcare.

The study tracked 35 measures for senior health in each state using data from several federal agencies, including the U.S. Department of Health and Human Services, the U.S. Department of Commerce and the U.S. Department of Labor. Categories assessed included behavior, community and environment, policy, clinical care, outcomes and supplemental measures.

Other study findings for California seniors included a low numbers of smokers (8th in the nation) , 46th for chronic drinking, 4th in the nation for obesity and 48th for poor mental health.

Click here to see the study results for California and here for the full report.

Ask the Expert: If Medicare pays for a procedure, does a Medicare Advantage plan also have to pay?

The California Medical Association (CMA) has received this question from physician practices many times over the past few years. The answer is – it depends.

Title XVIII of the Social Security Act established regulations for the Medicare program, which includes provisions affecting Medicare Advantage (MA) plans. The Centers for Medicare and Medicaid Services (CMS) has interpreted these provisions through the Medicare Managed Care Manual (Chapter 4 – Benefits and Beneficiary Protections). The Manual provides guidance for MA plans under Internet-only manual (IOM) 100-16. These guidelines reflect CMS’ current interpretation of the provisions of the MA statute and regulations (Chapter 42 of the Code of Federal Regulations, part 422) pertaining to benefits and beneficiary protections.

In general, the Act lists categories of items and services covered by Medicare. Congress occasionally adds specific services to be covered by Medicare. The MA plans are required to provide enrollees with all basic categories of benefits under Original Medicare. Some examples of services that are specifically defined in the Act and that MA plans would be required to cover are prostate cancer screening tests for a man over 50 years of age who has not been tested in the preceding year, as well as pneumococcal, influenza and hepatitis B vaccines and administration.

While MA plans are required to provide coverage for the same basic categories of benefits as Original Medicare would provide, MA plans are not necessarily required to pay for all of the same procedures that Medicare would have paid. So, how can you determine when an MA plan is required to pay?

According to the CMS Internet Only Manual 100-16, Chapter 1 (page 4), an item or service classified as an original Medicare benefit must be covered by an MA plan if:

  • The specific service is specifically identified in the Act (section 1861) (unless superseded by written CMS instructions or regulations regarding Part C of the Medicare program);
  • CMS has a National Coverage Determination specifically listing that CPT code as medically necessary/payable; or
  • A local Medicare Administrative Contractor with jurisdiction for claims in your geographic region has a Local Coverage Determination that specifically lists that CPT code as medically necessary/payable.
In other words, if the service in question doesn’t fall into one of the above categories, the MA plan may have its own medical policy and deem a procedure experimental, investigational or not medically necessary and deny payment. For this reason, it’s important to be familiar with the medical policies of the plans for which you contract.


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