On March 23, 2010, President Obama signed into law the Patient Protection and Affordable Care Act and soon after, the Health Care Education Affordability Reconciliation Act. Effectively reforming the health care system, these new laws contain a multitude of provisions, some of which take effect immediately while others will be implemented over the next several years.
Here’s how the laws will affect your medical practice:
Expanded coverage. The laws ushered in a series of specific initiatives to expand health care coverage including: mandated new benefits for Medicare, Medicaid and commercial insurance recipients; provisions that first encourage and later mandate employers, based on size, to provide employee health coverage; expansion of eligibility for Medicaid; establishment of a temporary high-risk pool for the uninsured; and the elimination of pre-existing and lifetime limits exclusions for patients covered by private payers. State-based insurance “exchanges” open in 2014. Also in 2014, is the introduction of fines for patients who remain uninsured and penalties for employers with more than 50 workers that do not offer coverage. The details of some provisions are extensive while many more have yet to be worked out, but the bottom line is that more patients will be insured. The impact on your practice? More insured patients, more covered benefits, and less bad debt.
Enhanced reimbursement – for some.The law offers incentive payments for primary care physicians (family practitioners, internists, pediatrics and geriatricians) in the form of a 10 percent bonus payment for evaluation and management services during the five-year period of 2011 to 2016. During the same period, general surgeons practicing in a healthcare professional shortage area (HPSA) get a 10 percent bonus for “major procedures.” More immediately, Medicare boosts payments for psychotherapy services by five percent in 2010 and extends the exceptions process for outpatient therapy caps. For 2013 and 2014, primary care physicians will receive rates at or above Medicare when treating Medicaid beneficiaries. Although Congress failed to fix the flawed driver for the Medicare payment system – the sustainable growth rate – it did re-establish a “floor” for the geographic practice cost index (GPCI) for physician work. Rural areas will also benefit from an adjustment to the GPCI for practice expense. The American Medical Association reports that physicians in 56 localities in 42 states will benefit from the GPCI adjustments, which are retroactive to January 1, 2010.
Pay-for-performance (P4P) continues. Medicare’s P4P program, the Physician Quality Reporting Initiative (PQRI), is extended – and participation will soon be required to avoid reimbursement penalties. As compared to the current bonus of two percent, PQRI will offer a payment equal to one percent of total allowed charges in 2011, reduced to 0.5 percent from 2012 to 2014. In 2015, a penalty of 1.5 percent will kick in. It will increase to a two percent reimbursement penalty in 2016 and subsequent years for physicians who choose not to participate in PQRI.
http://www.opencongress.org/bill/111-h4851/show
Healthcare reform may bring a host of other changes that will have an impact on physicians, their practices and their employees – everything from new compliance rules and penalties to small business tax credits to employer coverage rules. For medical practices, the bottom line is that the expansion of health insurance coverage to millions more Americans will increase demand for access to your services. How the reforms will affect your revenue from professional services remains to be seen.
