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Medicare Prescription Drug Improvement & Modernization Act of 2003: Interesting Issues for Nurse Practitioners
Howard L. Sollins
410-347-7369
hlsollins@ober.com
Appeared in The NCGNP Newsletter
Winter 2004
Much of the focus arising from the adoption of the Medicare Prescription Drug, Improvement and Modernization Act of 2003 ("MPDIMA") has been on the new Medicare prescription drug benefit. Without question, this is an important new benefit that is of great interest to patients nurse practitioners serve. The MPDIMA is also the latest omnibus reform of the federal Medicare and Medicaid law and, as such, it includes a number of changes of specific interest to nurse practitioners.
Recognition of Attending Nurse Practitioners as Attending Physicians
Eligible to Serve Hospice Patients
To be eligible for hospice, a physician must certify the patient’s terminal illness and establish and periodically review the plan of care. Also, the attending physician provides ongoing care consistent with the hospice election. Effective now, a nurse practitioner is permitted to serve as the attending physician of a hospice patient, with the exception of certifying the beneficiary’s terminal status. As such, this provision reverses a restrictive interpretation offered in a Centers for Medicare and Medicaid Services ("CMS") Program Memorandum A-03-053 dated June 20, 2003
This change will need to be implemented with caution where the hospice beneficiary is also a resident of a Medicaid nursing facility. Home hospice benefits are available to residents of nursing facilities, including where the per diem care is covered under a state’s Medicaid program. Where that occurs, the nursing facility does not bill the Medicaid program. Instead, the nursing facility bills the hospice. In turn, the hospice is reimbursed the applicable Medicare hospice benefit, such as the home hospice benefit, and is reimbursed by the state’s Medicaid program an amount equal to 95% of the Medicaid nursing facility rate. The hospice then pays the nursing facility for its per diem services.
In such a setting, the resident must receive attending services compatible with the hospice benefit and the nursing facility Requirements of Participation under 42 C.F.R., Section 483.40. The Centers for Medicare and Medicaid Services ("CMS") has continued to clarify the authority and frequency of NP services providing attending physician services in long term care facilities. See, CMS Memorandum S&C -04-08. Those CMS policies will continue to apply, but with no restriction on the continued role of NP’s when the resident makes a hospice election.
Telehealth Opportunities for NPs in LTC Facilities
CMS will be conducting a demonstration project under which a skilled nursing facility is treated as an originating site for telehealth services. The report is due from CMS to Congress by July 1, 2003. Medicare pays for certain telecommunications systems as a substitute for face to face encounters to provide consultations, office or other outpatient visits, individual psychotherapy and pharmacologic management services. Beneficiaries are eligible for telehealth services only if they are presented from an originating site located either in a rural health professional shortage area or in a county that is not in a metropolitan statistical area.
The originating site is determined by the location of the beneficiary. This site already includes a hospital, office of a physician or practitioner, critical access hospital, a rural health clinic or a federally qualified health center. Telehealth cannot be used as a substitute for in-person required visits for physicians, nurse practitioners or physician assistants.
After the demonstration project, effective January l, 2006, the Secretary of HHS can approve SNFs as originating sites for telehealth locations and would need to establish mechanisms to ensure that this does not substitute for in-person visits. Since SNFs are locations in which NPs have strong relationships, this demonstration project could provide additional opportunities for NPs to supplement in-person visits with a wider range of beneficiary interactions using telehealth, enhancing access to services in LTC facilities.
Special Provisions for Durable Medical Equipment
The Secretary will establish and implement quality standards for durable medical equipment, prosthetics and orthotics and certain other items and services. Certain items will require a face-to-face examination and a prescription. Effective now, payment may not be made for a motorized or power wheelchair without a face-to-face examination and a prescription, which can be written by an NP. At the same time, in states where NPs are not permitted to write prescriptions or have restricted or limited authority, local law would need to be changed to enable NPs to take advantage of this federal authority.
Medicare Reimbursement
This article does not detail the changes to Medicare’s Part B reimbursement system for physicians. Those Provisions affecting physician reimbursement will affect NPs, subject to the same fee schedule. On January 7, 2004, CMS published an Interim Final Rule, in part, amending its physician fee schedule to implement MPDIMA requirements. This included tables estimating the impact on Medicare allowed charges by physician, practitioner and supplier category. These took into account otherwise required adjustments anticipated by a November 7, 2003 rule, Geographic Practice Cost Index ("GPCI") changes, as well as the impact of MPDIMA. For example, based on the November 7, 2003 regulation a reduction in the physician fee schedule conversion factor would have been implemented in 2004, and MPDIMA mitigated that reduction. MPDIMA also implemented changes to relative value units. GPCI adjustments will cause reimbursement to vary according to the region in which services are rendered. Taking into account the summary of these various changes depicted on Table 8 of the January 7th interim final regulation, there is an overall, average net 5% increase in NP Medicare Allowed Charges. It is also noted in Table 9 that the impact of the adjustments on selected codes anticipates, for codes 99301-99313, i.e. various levels of services rendered in nursing facilities, there is an increase of 0% to 2%, depending on the code.
There is a particular, new benefit on which NPs should focus. There is an extension of Medicare coverage to an initial preventive physical examination within the first 6 months after an individual becomes eligible for Part B services. Thus, adult NPs in practices with patients who are approaching the age when they will become eligible for Medicaid benefits should use this as an opportunity to encourage preventive examinations.
Important Changes to the
Medicare Reassignment Rules
The Medicare law requires that payment for services rendered to Medicare beneficiaries be made to the provider rendering the service. In certain situations, the provider is authorized to "reassign" that right to payment to another entity. Historically these included, in part, reassignment to an employer or reassignment to a "facility" in which services are rendered (including a hospital or skilled nursing facility). However, those rules did not permit reassignment on the basis of an independent contractor agreement in all settings. This placed constraints on the manner and nature of contractual arrangements available to NPs and all other providers reimbursed on the basis of the physician fee schedule.
Under the MPDIMA, NPs (as well as physicians) are now permitted to reassign their right to payment to another entity that would enroll in the Medicare program, so long as there is a contractual agreement between the physician and that entity under which that entity submits the bill for the service. This will mean that NPs can retain independent contractor status with entities that bill for their services. CMS will be issuing instructions on how to implement these provisions.
This will create many more practice opportunities for NPs. For example, NPs will be better able to explore opportunities to form professional practices and enter into independent contractor relationships with multiple entities. In so doing, the terms of those agreements will be important, as a supplement to the traditional collaboration agreement between NPs and one or more physicians.
Potential Opportunities for Registered Nurse First Assistants:
Greater Competition for Surgical NPs?
Depending on state law and hospital credentialing, Registered Nurse First Assistants ("RNFAs") may perform a variety of tasks, some of which may exceed the scope of services included in the hospital’s reimbursement under the applicable DRG as well as the professional service of the principal surgeon, to a degree that a medically necessary first assistant fee may be billed under Part B. However, notwithstanding the scope of those services, CMS only permits payment to qualified providers of first assistant services, such as a second surgeon. Whatever their permitted scope, the surgical services of RNFAs are not permitted to be billed to Part B.
Some RNFAs may be credentialed as NPs (or as physician assistants). Where this is the case, payment is made at a percentage of the first assistant fee otherwise payable to a physician providing the identical first assistant service.
Under the MPDIMA, MedPAC will now study whether Medicare Part B should reimburse for RNFA services. The report is due January 1, 2005. If Part B payment is extended to all qualified RNFAs, this will increase competition for RNFAs who are NPs, and may have the effect of reducing demand for NP training and credentialing for nurses who presently seek that credential solely to be eligible for Part B reimbursement.
Chronic Care Improvement Programs
HHS will be establishing and implementing chronic care improvement programs. This will provide increase opportunities for NPs working with disease management programs. NPs with that interest should monitor the CMS website for continuing information about those programs.
Medicare Advantage Opportunities
CMS’ Medicare+Choice plans did not prove to be a widespread success. Yet, there has been continued interest in making available Medicare managed care alternatives in which there would be greater interest. Under the new legislation, Congress hopes to spur interest in Medicare Advantage plans as successors to the Medicare+Choice plans. If this occurs, NPs will need to consider ways they can join such panels and provide services as network practitioners.
Under Section 231 of the MPDIMA, there are provisions concerning the approval of Specialized Medicare Advantage plans, for beneficiaries with special needs. Congress specifically singled out the EverCare model and the Wisconsin Partnership demonstration project as examples of what a special MA plan could represent. Under EverCare, nursing home residents paired with physician/NP teams in exchange for a fixed payment. This will mean greater interest and opportunities for NPs. A special needs beneficiary can be defined as Medicare Advantage beneficiaries who institutionalized, entitled to Medicaid or with severe and disabling conditions that the HHS would identify.
NPs are therefore well-advised to monitor and seek enhancements to state laws governing third party payer panels and the manner in which NPs may participate in them, not only in general but with a particular focus on specialized plans that would be well-served by NP-managed programs.
Conclusion
It is evident that NPs are an accepted part of the health care delivery system and offer services Congress and CMS recognize must be integrated into services to Medicare beneficiaries. As Medicare focuses to a greater degree on managed care alternatives, wellness, telehealth and disease management programs, enhanced opportunities for NPs will arise. The change in the reassignment rules will broaden the organizational and practice settings through which NPs will have the opportunity to provide services. Moreover, it will be up to NPs to recognize and adapt to them and to work to ensure that state law does not prohibit them from taking advantage of this national developments. The MPDIMA is not just about the prescription drug benefit, but represents an important step and opportunity for NPs it they choose to avail themselves of it.
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