42 USC 1395w-4 - Payment for physicians’ services

U.S Code last checked for updates: Nov 22, 2024

§ 1395w–4.

Payment for physicians’ services

(a)

Payment based on fee schedule

(1)

In general

Effective for all physicians’ services (as defined in subsection (j)(3)) furnished under this part during a year (beginning with 1992) for which payment is otherwise made on the basis of a reasonable charge or on the basis of a fee schedule under section 1395m(b) of this title, payment under this part shall instead be based on the lesser of—

(A)

the actual charge for the service, or

(B)

subject to the succeeding provisions of this subsection, the amount determined under the fee schedule established under subsection (b) for services furnished during that year (in this subsection referred to as the “fee schedule amount”).

(2)

Transition to full fee schedule

(A)

Limiting reductions and increases to 15 percent in 1992

(i)

Limit on increase

(ii)

Limit in reduction

(B)

Special rule for 1993, 1994, and 1995

If a physicians’ service in a fee schedule area is subject to the provisions of subparagraph (A) in 1992, for physicians’ services furnished in the area—

(i)

during 1993, there shall be substituted for the fee schedule amount an amount equal to the sum of—

(I)

75 percent of the fee schedule amount determined under subparagraph (A), adjusted by the update established under subsection (d)(3) for 1993, and

(II)

25 percent of the fee schedule amount determined under paragraph (1) for 1993 without regard to this paragraph;

(ii)

during 1994, there shall be substituted for the fee schedule amount an amount equal to the sum of—

(I)

67 percent of the fee schedule amount determined under clause (i), adjusted by the update established under subsection (d)(3) for 1994 and as adjusted under subsection (c)(2)(F)(ii) and under section 13515(b) of the Omnibus Budget Reconciliation Act of 1993, and

(II)

33 percent of the fee schedule amount determined under paragraph (1) for 1994 without regard to this paragraph; and

(iii)

during 1995, there shall be substituted for the fee schedule amount an amount equal to the sum of—

(I)

50 percent of the fee schedule amount determined under clause (ii) adjusted by the update established under subsection (d)(3) for 1995, and

(II)

50 percent of the fee schedule amount determined under paragraph (1) for 1995 without regard to this paragraph.

(C)

Special rule for anesthesia and radiology services

(D)

“Adjusted historical payment basis” defined

(i)

In general

(ii)

Application to radiology services

(iii)

Nuclear medicine services

(3)

Incentives for participating physicians and suppliers

(4)

Special rule for medical direction

(A)

In general

(B)

Amount

The amount described in this subparagraph, for a physician’s medical direction of the performance of anesthesia services, is the following percentage of the fee schedule amount otherwise applicable under this section if the anesthesia services were personally performed by the physician alone:

(i)

For services furnished during 1994, 120 percent.

(ii)

For services furnished during 1995, 115 percent.

(iii)

For services furnished during 1996, 110 percent.

(iv)

For services furnished during 1997, 105 percent.

(v)

For services furnished after 1997, 100 percent.

(5)

Incentives for electronic prescribing

(A)

Adjustment

(i)

In general

(ii)

Applicable percent

For purposes of clause (i), the term “applicable percent” means—

(I)

for 2012, 99 percent;

(II)

for 2013, 98.5 percent; and

(III)

for 2014, 98 percent.

(B)

Significant hardship exception

(C)

Application

(i)

Physician reporting system rules

(ii)

Incentive payment validation rules

(D)

Definitions

For purposes of this paragraph:

(i)

Eligible professional; covered professional services

(ii)

Physician reporting system

(iii)

Reporting period

(6)

Special rule for teaching anesthesiologists

With respect to physicians’ services furnished on or after January 1, 2010, in the case of teaching anesthesiologists involved in the training of physician residents in a single anesthesia case or two concurrent anesthesia cases, the fee schedule amount to be applied shall be 100 percent of the fee schedule amount otherwise applicable under this section if the anesthesia services were personally performed by the teaching anesthesiologist alone and paragraph (4) shall not apply if—

(A)

the teaching anesthesiologist is present during all critical or key portions of the anesthesia service or procedure involved; and

(B)

the teaching anesthesiologist (or another anesthesiologist with whom the teaching anesthesiologist has entered into an arrangement) is immediately available to furnish anesthesia services during the entire procedure.

(7)

Incentives for meaningful use of certified EHR technology

(A)

Adjustment

(i)

In general

(ii)

Applicable percent

Subject to clause (iii), for purposes of clause (i), the term “applicable percent” means—

(I)

for 2015, 99 percent (or, in the case of an eligible professional who was subject to the application of the payment adjustment under subsection (a)(5) for 2014, 98 percent);

(II)

for 2016, 98 percent; and

(III)

for 2017 and 2018, 97 percent.

(iii)

Authority to decrease applicable percentage for 2018

(B)

Significant hardship exception

(C)

Application of physician reporting system rules

(D)

Non-application to hospital-based and ambulatory surgical center-based eligible professionals

(i)

Hospital-based

(ii)

Ambulatory surgical center-based

(iii)

Determination

The determination of whether an eligible professional is an eligible professional described in clause (ii) may be made on the basis of—

(I)

the site of service (as defined by the Secretary); or

(II)

an attestation submitted by the eligible professional.

Determinations made under subclauses (I) and (II) shall be made without regard to any employment or billing arrangement between the eligible professional and any other supplier or provider of services.

(iv)

Sunset

(E)

Definitions

For purposes of this paragraph:

(i)

Covered professional services

(ii)

EHR reporting period

(iii)

Eligible professional

(8)

Incentives for quality reporting

(A)

Adjustment

(i)

In general

(ii)

Applicable percent

For purposes of clause (i), the term “applicable percent” means—

(I)

for 2015, 98.5 percent; and

(II)

for 2016, 2017, and 2018, 98 percent.

(B)

Application

(i)

Physician reporting system rules

(ii)

Incentive payment validation rules

(C)

Definitions

For purposes of this paragraph:

(i)

Eligible professional; covered professional services

(ii)

Physician reporting system

(iii)

Quality reporting period

(9)

Information reporting on services included in global surgical packages

(b)

Establishment of fee schedules

(1)

In general

Before November 1 of the preceding year, for each year beginning with 1998, subject to subsection (p), the Secretary shall establish, by regulation, fee schedules that establish payment amounts for all physicians’ services furnished in all fee schedule areas (as defined in subsection (j)(2)) for the year. Except as provided in paragraph (2), each such payment amount for a service shall be equal to the product of—

(A)

the relative value for the service (as determined in subsection (c)(2)),

(B)

the conversion factor (established under subsection (d)) for the year, and

(C)

the geographic adjustment factor (established under subsection (e)(2)) for the service for the fee schedule area.

(2)

Treatment of radiology services and anesthesia services

(A)

Radiology services

(B)

Anesthesia services

(C)

Consultation

(3)

Treatment of interpretation of electrocardiograms

The Secretary—

(A)

shall make separate payment under this section for the interpretation of electrocardiograms performed or ordered to be performed as part of or in conjunction with a visit to or a consultation with a physician, and

(B)

shall adjust the relative values established for visits and consultations under subsection (c) so as not to include relative value units for interpretations of electrocardiograms in the relative value for visits and consultations.

(4)

Special rule for imaging services

(A)

In general

In the case of imaging services described in subparagraph (B) furnished on or after January 1, 2007, if—

(i)

the technical component (including the technical component portion of a global fee) of the service established for a year under the fee schedule described in paragraph (1) without application of the geographic adjustment factor described in paragraph (1)(C), exceeds

(ii)

the Medicare OPD fee schedule amount established under the prospective payment system for hospital outpatient department services under paragraph (3)(D) of section 1395l(t) of this title for such service for such year, determined without regard to geographic adjustment under paragraph (2)(D) of such section,

the Secretary shall substitute the amount described in clause (ii), adjusted by the geographic adjustment factor described in paragraph (1)(C), for the fee schedule amount for such technical component for such year.

(B)

Imaging services described

(C)

Adjustment in imaging utilization rate

(D)

Adjustment in technical component discount on single-session imaging involving consecutive body parts

(5)

Treatment of intensive cardiac rehabilitation program

(A)

In general

(B)

Definition of session

(C)

Multiple sessions per day

(6)

Treatment of bone mass scans

For dual-energy x-ray absorptiometry services (identified in 2006 by HCPCS codes 76075 and 76077 (and any succeeding codes)) furnished during 2010, 2011, and the first 2 months of 2012, instead of the payment amount that would otherwise be determined under this section for such years, the payment amount shall be equal to 70 percent of the product of—

(A)

the relative value for the service (as determined in subsection (c)(2)) for 2006;

(B)

the conversion factor (established under subsection (d)) for 2006; and

(C)

the geographic adjustment factor (established under subsection (e)(2)) for the service for the fee schedule area for 2010, 2011, and the first 2 months of 2012, respectively.

(7)

Adjustment in discount for certain multiple therapy services

(8)

Encouraging care management for individuals with chronic care needs

(A)

In general

(B)

Policies relating to payment

In carrying out this paragraph, with respect to chronic care management services, the Secretary shall—

(i)

make payment to only one applicable provider for such services furnished to an individual during a period;

(ii)

not make payment under subparagraph (A) if such payment would be duplicative of payment that is otherwise made under this subchapter for such services; and

(iii)

not require that an annual wellness visit (as defined in section 1395x(hhh) of this title) or an initial preventive physical examination (as defined in section 1395x(ww) of this title) be furnished as a condition of payment for such management services.

(9)

Special rule to incentivize transition from traditional X-ray imaging to digital radiography

(A)

Limitation on payment for film X-ray imaging services

(B)

Phased-in limitation on payment for computed radiography imaging services

In the case of an imaging service (including the imaging portion of a service) that is an X-ray taken using computed radiography technology—

(i)

in the case of such a service furnished during 2018, 2019, 2020, 2021, or 2022, the payment amount for the technical component (including the technical component portion of a global service) of such service that would otherwise be determined under this section (without application of this paragraph and before application of any other adjustment under this section) for such year shall be reduced by 7 percent; and

(ii)

in the case of such a service furnished during 2023 or a subsequent year, the payment amount for the technical component (including the technical component portion of a global service) of such service that would otherwise be determined under this section (without application of this paragraph and before application of any other adjustment under this section) for such year shall be reduced by 10 percent.

(C)

Computed radiography technology defined

(D)

Implementation

(10)

Reduction of discount in payment for professional component of multiple imaging services

(11)

Special rule for certain radiation therapy services

(12)

Payment for psychotherapy for crisis services furnished in an applicable site of service

(A)

In general

(B)

Services described

(C)

Amount of payment

(D)

Definitions

In this paragraph:

(i)

Applicable site of service

(ii)

Psychotherapy for crisis services

(c)

Determination of relative values for physicians’ services

(1)

Division of physicians’ services into components

In this section, with respect to a physicians’ service:

(A)

“Work component” defined

The term “work component” means the portion of the resources used in furnishing the service that reflects physician time and intensity in furnishing the service. Such portion shall—

(i)

include activities before and after direct patient contact, and

(ii)

be defined, with respect to surgical procedures, to reflect a global definition including pre-operative and post-operative physicians’ services.

(B)

“Practice expense component” defined

(C)

“Malpractice component” defined

(2)

Determination of relative values

(A)

In general

(i)

Combination of units for components

(ii)

Extrapolation

(B)

Periodic review and adjustments in relative values

(i)

Periodic review

(ii)

Adjustments

(I)

In general

(II)

Limitation on annual adjustments

(iii)

Consultation

(iv)

Exemption of certain additional expenditures from budget neutrality

The additional expenditures attributable to—

(I)

subparagraph (H) shall not be taken into account in applying clause (ii)(II) for 2004;

(II)

subparagraph (I) insofar as it relates to a physician fee schedule for 2005 or 2006 shall not be taken into account in applying clause (ii)(II) for drug administration services under the fee schedule for such year for a specialty described in subparagraph (I)(ii)(II);

(III)

subparagraph (J) insofar as it relates to a physician fee schedule for 2005 or 2006 shall not be taken into account in applying clause (ii)(II) for drug administration services under the fee schedule for such year;

(IV)

subsection (b)(6) shall not be taken into account in applying clause (ii)(II) for 2010, 2011, or the first 2 months of 2012;

(V)

subsection (t) shall not be taken into account in applying clause (ii)(II) for 2021, 2022, 2023, or 2024; and

(VI)

subsection (b)(12) shall not be taken into account in applying clause (ii)(II) for 2024.

(v)

Exemption of certain reduced expenditures from budget-neutrality calculation

The following reduced expenditures, as estimated by the Secretary, shall not be taken into account in applying clause (ii)(II):

(I)

Reduced payment for multiple imaging procedures

(II)

OPD payment cap for imaging services

(III)

Change in utilization rate for certain imaging services

(IV)

, (V) Repealed. Pub. L. 111–152, title I, § 1107(2), Mar. 30, 2010, 124 Stat. 1050

(VI)

Additional reduced payment for multiple imaging procedures

(VII)

Reduced expenditures for multiple therapy services

(VIII)

Reduced expenditures attributable to application of quality incentives for computed tomography

(IX)

Reductions for misvalued services if target not met

(X)

Reduced expenditures attributable to incentives to transition to digital radiography

(XI)

Discount in payment for professional component of imaging services

(vi)

Alternative application of budget-neutrality adjustment

(C)

Computation of relative value units for components

For purposes of this section for each physicians’ service—

(i)

Work relative value units

(ii)

Practice expense relative value units

The Secretary shall determine a number of practice expense relative value units for the service for years before 1999 equal to the product of—

(I)

the base allowed charges (as defined in subparagraph (D)) for the service, and

(II)

the practice expense percentage for the service (as determined under paragraph (3)(C)(ii)),

and for years beginning with 1999 based on the relative practice expense resources involved in furnishing the service or group of services. For 1999, such number of units shall be determined based 75 percent on such product and based 25 percent on the relative practice expense resources involved in furnishing the service. For 2000, such number of units shall be determined based 50 percent on such product and based 50 percent on such relative practice expense resources. For 2001, such number of units shall be determined based 25 percent on such product and based 75 percent on such relative practice expense resources. For a subsequent year, such number of units shall be determined based entirely on such relative practice expense resources.

(iii)

Malpractice relative value units

The Secretary shall determine a number of malpractice relative value units for the service or group of services for years before 2000 equal to the product of—

(I)

the base allowed charges (as defined in subparagraph (D)) for the service or group of services, and

(II)

the malpractice percentage for the service or group of services (as determined under paragraph (3)(C)(iii)),

and for years beginning with 2000 based on the malpractice expense resources involved in furnishing the service or group of services.

(D)

“Base allowed charges” defined

(E)

Reduction in practice expense relative value units for certain services

(i)

In general

Subject to clause (ii), the Secretary shall reduce the practice expense relative value units applied to services described in clause (iii) furnished in—

(I)

1994, by 25 percent of the number by which the number of practice expense relative value units (determined for 1994 without regard to this subparagraph) exceeds the number of work relative value units determined for 1994,

(II)

1995, by an additional 25 percent of such excess, and

(III)

1996, by an additional 25 percent of such excess.

(ii)

Floor on reductions

(iii)

Services covered

For purposes of clause (i), the services described in this clause are physicians’ services that are not described in clause (iv) and for which—

(I)

there are work relative value units, and

(II)

the number of practice expense relative value units (determined for 1994) exceeds 128 percent of the number of work relative value units (determined for such year).

(iv)

Excluded services

(F)

Budget neutrality adjustments

The Secretary—

(i)

shall reduce the relative values for all services (other than anesthesia services) established under this paragraph (and, in the case of anesthesia services, the conversion factor established by the Secretary for such services) by such percentage as the Secretary determines to be necessary so that, beginning in 1996, the amendment made by section 13514(a) of the Omnibus Budget Reconciliation Act of 1993 would not result in expenditures under this section that exceed the amount of such expenditures that would have been made if such amendment had not been made, and

(ii)

shall reduce the amounts determined under subsection (a)(2)(B)(ii)(I) by such percentage as the Secretary determines to be required to assure that, taking into account the reductions made under clause (i), the amendment made by section 13514(a) of the Omnibus Budget Reconciliation Act of 1993 would not result in expenditures under this section in 1994 that exceed the amount of such expenditures that would have been made if such amendment had not been made.

(G)

Adjustments in relative value units for 1998

(i)

In general

The Secretary shall—

(I)

subject to clauses (iv) and (v), reduce the practice expense relative value units applied to any services described in clause (ii) furnished in 1998 to a number equal to 110 percent of the number of work relative value units, and

(II)

increase the practice expense relative value units for office visit procedure codes during 1998 by a uniform percentage which the Secretary estimates will result in an aggregate increase in payments for such services equal to the aggregate decrease in payments by reason of subclause (I).

(ii)

Services covered

For purposes of clause (i), the services described in this clause are physicians’ services that are not described in clause (iii) and for which—

(I)

there are work relative value units, and

(II)

the number of practice expense relative value units (determined for 1998) exceeds 110 percent of the number of work relative value units (determined for such year).

(iii)

Excluded services

(iv)

Limitation on aggregate reallocation

(v)

No reduction for certain services

(H)

Adjustments in practice expense relative value units for certain drug administration services beginning in 2004

(i)

Use of survey data

In establishing the physician fee schedule under subsection (b) with respect to payments for services furnished on or after January 1, 2004, the Secretary shall, in determining practice expense relative value units under this subsection, utilize a survey submitted to the Secretary as of January 1, 2003, by a physician specialty organization pursuant to section 212 of the Medicare, Medicaid, and SCHIP Balanced Budget Refinement Act of 1999 if the survey—

(I)

covers practice expenses for oncology drug administration services; and

(II)

meets criteria established by the Secretary for acceptance of such surveys.

(ii)

Pricing of clinical oncology nurses in practice expense methodology

(iii)

Work relative value units for certain drug administration services

(iv)

Drug administration services described

The drug administration services described in this clause are physicians’ services—

(I)

which are classified as of October 1, 2003, within any of the following groups of procedures: therapeutic or diagnostic infusions (excluding chemotherapy); chemotherapy administration services; and therapeutic, prophylactic, or diagnostic injections;

(II)

for which there are no work relative value units assigned under this subsection as of such date; and

(III)

for which national relative value units have been assigned under this subsection as of such date.

(I)

Adjustments in practice expense relative value units for certain drug administration services beginning with 2005

(i)

In general

(ii)

Use of supplemental survey data

(I)

In general

(II)

Limitation on specialty

(III)

Application

(J)

Provisions for appropriate reporting and billing for physicians’ services associated with the administration of covered outpatient drugs and biologicals

(i)

Evaluation of codes

(ii)

Use of existing processes

(iii)

Implementation

(iv)

Subsequent, budget neutral adjustments permitted

(K)

Potentially misvalued codes

(i)

In general

The Secretary shall—

(I)

periodically identify services as being potentially misvalued using criteria specified in clause (ii); and

(II)

review and make appropriate adjustments to the relative values established under this paragraph for services identified as being potentially misvalued under subclause (I).

(ii)

Identification of potentially misvalued codes

For purposes of identifying potentially misvalued codes pursuant to clause (i)(I), the Secretary shall examine codes (and families of codes as appropriate) based on any or all of the following criteria:

(I)

Codes that have experienced the fastest growth.

(II)

Codes that have experienced substantial changes in practice expenses.

(III)

Codes that describe new technologies or services within an appropriate time period (such as 3 years) after the relative values are initially established for such codes.

(IV)

Codes which are multiple codes that are frequently billed in conjunction with furnishing a single service.

(V)

Codes with low relative values, particularly those that are often billed multiple times for a single treatment.

(VI)

Codes that have not been subject to review since implementation of the fee schedule.

(VII)

Codes that account for the majority of spending under the physician fee schedule.

(VIII)

Codes for services that have experienced a substantial change in the hospital length of stay or procedure time.

(IX)

Codes for which there may be a change in the typical site of service since the code was last valued.

(X)

Codes for which there is a significant difference in payment for the same service between different sites of service.

(XI)

Codes for which there may be anomalies in relative values within a family of codes.

(XII)

Codes for services where there may be efficiencies when a service is furnished at the same time as other services.

(XIII)

Codes with high intra-service work per unit of time.

(XIV)

Codes with high practice expense relative value units.

(XV)

Codes with high cost supplies.

(XVI)

Codes as determined appropriate by the Secretary.

(iii)

Review and adjustments

(I)

The Secretary may use existing processes to receive recommendations on the review and appropriate adjustment of potentially misvalued services described in clause (i)(II).

(II)

The Secretary may conduct surveys, other data collection activities, studies, or other analyses as the Secretary determines to be appropriate to facilitate the review and appropriate adjustment described in clause (i)(II).

(III)

The Secretary may use analytic contractors to identify and analyze services identified under clause (i)(I), conduct surveys or collect data, and make recommendations on the review and appropriate adjustment of services described in clause (i)(II).

(IV)

The Secretary may coordinate the review and appropriate adjustment described in clause (i)(II) with the periodic review described in subparagraph (B).

(V)

As part of the review and adjustment described in clause (i)(II), including with respect to codes with low relative values described in clause (ii), the Secretary may make appropriate coding revisions (including using existing processes for consideration of coding changes) which may include consolidation of individual services into bundled codes for payment under the fee schedule under subsection (b).

(VI)

The provisions of subparagraph (B)(ii)(II) and paragraph (7) shall apply to adjustments to relative value units made pursuant to this subparagraph in the same manner as such provisions apply to adjustments under subparagraph (B)(ii)(I).

(iv)

Treatment of certain radiation therapy services

(L)

Validating relative value units

(i)

In general

(ii)

Components and elements of work

(iii)

Scope of codes

(iv)

Methods

(v)

Adjustments

(M)

Authority to collect and use information on physicians’ services in the determination of relative values

(i)

Collection of information

(ii)

Use of information

(iii)

Types of information

The types of information described in clauses (i) and (ii) may, at the Secretary’s discretion, include any or all of the following:

(I)

Time involved in furnishing services.

(II)

Amounts and types of practice expense inputs involved with furnishing services.

(III)

Prices (net of any discounts) for practice expense inputs, which may include paid invoice prices or other documentation or records.

(IV)

Overhead and accounting information for practices of physicians and other suppliers.

(V)

Any other element that would improve the valuation of services under this section.

(iv)

Information collection mechanisms

Information may be collected or obtained pursuant to this subparagraph from any or all of the following:

(I)

Surveys of physicians, other suppliers, providers of services, manufacturers, and vendors.

(II)

Surgical logs, billing systems, or other practice or facility records.

(III)

Electronic health records.

(IV)

Any other mechanism determined appropriate by the Secretary.

(v)

Transparency of use of information

(I)

In general

(II)

Thresholds for use

(III)

Disclosure of information

(vi)

Incentive to participate

(vii)

Administration

(viii)

Definition of eligible professional

(ix)

Funding

(N)

Authority for alternative approaches to establishing practice expense relative values

(O)

Target for relative value adjustments for misvalued services

With respect to fee schedules established for each of 2016 through 2018, the following shall apply:

(i)

Determination of net reduction in expenditures

(ii)

Budget neutral redistribution of funds if target met and counting overages towards the target for the succeeding year

If the estimated net reduction in expenditures determined under clause (i) for the year is equal to or greater than the target for the year—

(I)

reduced expenditures attributable to such adjustments shall be redistributed for the year in a budget neutral manner in accordance with subparagraph (B)(ii)(II); and

(II)

the amount by which such reduced expenditures exceeds the target for the year shall be treated as a reduction in expenditures described in clause (i) for the succeeding year, for purposes of determining whether the target has or has not been met under this subparagraph with respect to that year.

(iii)

Exemption from budget neutrality if target not met

(iv)

Target recapture amount

For purposes of clause (iii), the target recapture amount is, with respect to a year, an amount equal to the difference between—

(I)

the target for the year; and

(II)

the estimated net reduction in expenditures determined under clause (i) for the year.

(v)

Target

(3)

Component percentages

For purposes of paragraph (2), the Secretary shall determine a work percentage, a practice expense percentage, and a malpractice percentage for each physician’s service as follows:

(A)

Division of services by specialty

(B)

Division of specialty by component

(C)

Determination of component percentages

(i)

Work percentage

The work percentage for a service (or class of services) is equal to the sum (for all physician specialties) of—

(I)

the average percentage division for the work component for each physician specialty (determined under subparagraph (B)), multiplied by

(II)

the proportion (determined under subparagraph (A)) of such service (or services) performed by physicians in that specialty.

(ii)

Practice expense percentage

(I)

the average percentage division for the practice expense component for each physician specialty (determined under subparagraph (B)), multiplied by

(II)

the proportion (determined under subparagraph (A)) of such service (or services) performed by physicians in that specialty.

(iii)

Malpractice percentage

For years before 1999, the malpractice percentage for a service (or class of services) is equal to the sum (for all physician specialties) of—

(I)

the average percentage division for the malpractice component for each physician specialty (determined under subparagraph (B)), multiplied by

(II)

the proportion (determined under subparagraph (A)) of such service (or services) performed by physicians in that specialty.

(D)

Periodic recomputation

(4)

Ancillary policies

(5)

Coding

(6)

No variation for specialists

(7)

Phase-in of significant relative value unit (RVU) reductions

(8)

Global surgical packages

(A)

Prohibition of implementation of rule regarding global surgical packages

(i)

In general

(ii)

Construction

(B)

Collection of data on services included in global surgical packages

(i)

In general

(ii)

Reassessment and potential sunset

(iii)

Inspector general audit

(C)

Improving accuracy of pricing for surgical services

(d)

Conversion factors

(1)

Establishment

(A)

In general

(B)

Special provision for 1992

(C)

Special rules for 1998

(D)

Special rules for anesthesia services

(E)

Publication and dissemination of information

The Secretary shall—

(i)

cause to have published in the Federal Register not later than November 1 of each year (beginning with 2000) the conversion factor which will apply to physicians’ services for the succeeding year, the update determined under paragraph (4) for such succeeding year, and the allowed expenditures under such paragraph for such succeeding year; and

(ii)

make available to the Medicare Payment Advisory Commission and the public by March 1 of each year (beginning with 2000) an estimate of the sustainable growth rate and of the conversion factor which will apply to physicians’ services for the succeeding year and data used in making such estimate.

(2)

Repealed. Pub. L. 105–33, title IV, § 4502(b), Aug. 5, 1997, 111 Stat. 433

(3)

Update for 1999 and 2000

(A)

In general

Unless otherwise provided by law, subject to subparagraph (D) and the budget-neutrality factor determined by the Secretary under subsection (c)(2)(B)(ii), the update to the single conversion factor established in paragraph (1)(C) for 1999 and 2000 is equal to the product of—

(i)

1 plus the Secretary’s estimate of the percentage increase in the MEI (as defined in section 1395u(i)(3) of this title) for the year (divided by 100), and

(ii)

1 plus the Secretary’s estimate of the update adjustment factor for the year (divided by 100),

minus 1 and multiplied by 100.

(B)

Update adjustment factor

For purposes of subparagraph (A)(ii), the “update adjustment factor” for a year is equal (as estimated by the Secretary) to—

(i)

the difference between (I) the sum of the allowed expenditures for physicians’ services (as determined under subparagraph (C)) for the period beginning April 1, 1997, and ending on March 31 of the year involved, and (II) the amount of actual expenditures for physicians’ services furnished during the period beginning April 1, 1997, and ending on March 31 of the preceding year; divided by

(ii)

the actual expenditures for physicians’ services for the 12-month period ending on March 31 of the preceding year, increased by the sustainable growth rate under subsection (f) for the fiscal year which begins during such 12-month period.

(C)

Determination of allowed expenditures

For purposes of this paragraph and paragraph (4), the allowed expenditures for physicians’ services for the 12-month period ending with March 31 of—

(i)

1997 is equal to the actual expenditures for physicians’ services furnished during such 12-month period, as estimated by the Secretary; or

(ii)

a subsequent year is equal to the allowed expenditures for physicians’ services for the previous year, increased by the sustainable growth rate under subsection (f) for the fiscal year which begins during such 12-month period.

(D)

Restriction on variation from medicare economic index

Notwithstanding the amount of the update adjustment factor determined under subparagraph (B) for a year, the update in the conversion factor under this paragraph for the year may not be—

(i)

greater than 100 times the following amount: (1.03 + (MEI percentage/100)) −1; or

(ii)

less than 100 times the following amount: (0.93 + (MEI percentage/100)) −1,

where “MEI percentage” means the Secretary’s estimate of the percentage increase in the MEI (as defined in section 1395u(i)(3) of this title) for the year involved.

(4)

Update for years beginning with 2001 and ending with 2014

(A)

In general

Unless otherwise provided by law, subject to the budget-neutrality factor determined by the Secretary under subsection (c)(2)(B)(ii) and subject to adjustment under subparagraph (F), the update to the single conversion factor established in paragraph (1)(C) for a year beginning with 2001 and ending with 2014 is equal to the product of—

(i)

1 plus the Secretary’s estimate of the percentage increase in the MEI (as defined in section 1395u(i)(3) of this title) for the year (divided by 100); and

(ii)

1 plus the Secretary’s estimate of the update adjustment factor under subparagraph (B) for the year.

(B)

Update adjustment factor

For purposes of subparagraph (A)(ii), subject to subparagraph (D) and the succeeding paragraphs of this subsection, the “update adjustment factor” for a year is equal (as estimated by the Secretary) to the sum of the following:

(i)

Prior year adjustment component

An amount determined by—

(I)

computing the difference (which may be positive or negative) between the amount of the allowed expenditures for physicians’ services for the prior year (as determined under subparagraph (C)) and the amount of the actual expenditures for such services for that year;

(II)

dividing that difference by the amount of the actual expenditures for such services for that year; and

(III)

multiplying that quotient by 0.75.

(ii)

Cumulative adjustment component

An amount determined by—

(I)

computing the difference (which may be positive or negative) between the amount of the allowed expenditures for physicians’ services (as determined under subparagraph (C)) from April 1, 1996, through the end of the prior year and the amount of the actual expenditures for such services during that period;

(II)

dividing that difference by actual expenditures for such services for the prior year as increased by the sustainable growth rate under subsection (f) for the year for which the update adjustment factor is to be determined; and

(III)

multiplying that quotient by 0.33.

(C)

Determination of allowed expenditures

For purposes of this paragraph:

(i)

Period up to April 1, 1999

(ii)

Transition to calendar year allowed expenditures

Subject to subparagraph (E), the allowed expenditures for—

(I)

the 9-month period beginning April 1, 1999, shall be the Secretary’s estimate of the amount of the allowed expenditures that would be permitted under paragraph (3)(C) for such period; and

(II)

the year of 1999, shall be the Secretary’s estimate of the amount of the allowed expenditures that would be permitted under paragraph (3)(C) for such year.

(iii)

Years beginning with 2000

(D)

Restriction on update adjustment factor

(E)

Recalculation of allowed expenditures for updates beginning with 2001

(F)

Transitional adjustment designed to provide for budget neutrality

Under this subparagraph the Secretary shall provide for an adjustment to the update under subparagraph (A)—

(i)

for each of 2001, 2002, 2003, and 2004, of −0.2 percent; and

(ii)

for 2005 of +0.8 percent.

(5)

Update for 2004 and 2005

(6)

Update for 2006

(7)

Conversion factor for 2007

(A)

In general

The conversion factor that would otherwise be applicable under this subsection for 2007 shall be the amount of such conversion factor divided by the product of—

(i)

1 plus the Secretary’s estimate of the percentage increase in the MEI (as defined in section 1395u(i)(3) of this title) for 2007 (divided by 100); and

(ii)

1 plus the Secretary’s estimate of the update adjustment factor under paragraph (4)(B) for 2007.

(B)

No effect on computation of conversion factor for 2008

(8)

Update for 2008

(A)

In general

(B)

No effect on computation of conversion factor for 2009

(9)

Update for 2009

(A)

In general

(B)

No effect on computation of conversion factor for 2010 and subsequent years

(10)

Update for January through May of 2010

(A)

In general

(B)

No effect on computation of conversion factor for remaining portion of 2010 and subsequent years

(11)

Update for June through December of 2010

(A)

In general

(B)

No effect on computation of conversion factor for 2011 and subsequent years

(12)

Update for 2011

(A)

In general

(B)

No effect on computation of conversion factor for 2012 and subsequent years

(13)

Update for 2012

(A)

In general

(B)

No effect on computation of conversion factor for 2013 and subsequent years

(14)

Update for 2013

(A)

In general

(B)

No effect on computation of conversion factor for 2014 and subsequent years

(15)

Update for 2014

(A)

In general

(B)

No effect on computation of conversion factor for subsequent years

(16)

Update for January through June of 2015

(17)

Update for July through December of 2015

(18)

Update for 2016 through 2019

The update to the single conversion factor established in paragraph (1)(C)—

(A)

for 2016 and each subsequent year through 2018 shall be 0.5 percent; and

(B)

for 2019 shall be 0.25 percent.

(19)

Update for 2020 through 2025

(20)

Update for 2026 and subsequent years

(e)

Geographic adjustment factors

(1)

Establishment of geographic indices

(A)

In general

Subject to subparagraphs (B), (C), (E), (G), (H), and (I), the Secretary shall establish—

(i)

an index which reflects the relative costs of the mix of goods and services comprising practice expenses (other than malpractice expenses) in the different fee schedule areas compared to the national average of such costs,

(ii)

an index which reflects the relative costs of malpractice expenses in the different fee schedule areas compared to the national average of such costs, and

(iii)

an index which reflects ¼ of the difference between the relative value of physicians’ work effort in each of the different fee schedule areas and the national average of such work effort.

(B)

Class-specific geographic cost-of-practice indices

(C)

Periodic review and adjustments in geographic adjustment factors

(D)

Use of recent data

(E)

Floor at 1.0 on work geographic index

(G)

 So in original. No subpar. (F) has been enacted.

Floor for practice expense, malpractice, and work geographic indices for services furnished in Alaska

(H)

Practice expense geographic adjustment for 2010 and subsequent years

(i)

For 2010

(ii)

For 2011

(iii)

Hold harmless

(iv)

Analysis

The Secretary shall analyze current methods of establishing practice expense geographic adjustments under subparagraph (A)(i) and evaluate data that fairly and reliably establishes distinctions in the costs of operating a medical practice in the different fee schedule areas. Such analysis shall include an evaluation of the following:

(I)

The feasibility of using actual data or reliable survey data developed by medical organizations on the costs of operating a medical practice, including office rents and non-physician staff wages, in different fee schedule areas.

(II)

The office expense portion of the practice expense geographic adjustment described in subparagraph (A)(i), including the extent to which types of office expenses are determined in local markets instead of national markets.

(III)

The weights assigned to each of the categories within the practice expense geographic adjustment described in subparagraph (A)(i).

(v)

Revision for 2012 and subsequent years

As a result of the analysis described in clause (iv), the Secretary shall, not later than January 1, 2012, make appropriate adjustments to the practice expense geographic adjustment described in subparagraph (A)(i) to ensure accurate geographic adjustments across fee schedule areas, including—

(I)

basing the office rents component and its weight on office expenses that vary among fee schedule areas; and

(II)

considering a representative range of professional and non-professional personnel employed in a medical office based on the use of the American Community Survey data or other reliable data for wage adjustments.

Such adjustments shall be made without regard to adjustments made pursuant to clauses (i) and (ii) and shall be made in a budget neutral manner.

(I)

Floor for practice expense index for services furnished in frontier States

(i)

In general

(ii)

Limitation

(2)

Computation of geographic adjustment factor

(3)

Geographic cost-of-practice adjustment factor

For purposes of paragraph (2), the “geographic cost-of-practice adjustment factor”, for a service for a fee schedule area, is the product of—

(A)

the proportion of the total relative value for the service that reflects the relative value units for the practice expense component, and

(B)

the geographic cost-of-practice index value for the area for the service, based on the index established under paragraph (1)(A)(i) or (1)(B) (as the case may be).

(4)

Geographic malpractice adjustment factor

For purposes of paragraph (2), the “geographic malpractice adjustment factor”, for a service for a fee schedule area, is the product of—

(A)

the proportion of the total relative value for the service that reflects the relative value units for the malpractice component, and

(B)

the geographic malpractice index value for the area, based on the index established under paragraph (1)(A)(ii).

(5)

Geographic physician work adjustment factor

For purposes of paragraph (2), the “geographic physician work adjustment factor”, for a service for a fee schedule area, is the product of—

(A)

the proportion of the total relative value for the service that reflects the relative value units for the work component, and

(B)

the geographic physician work index value for the area, based on the index established under paragraph (1)(A)(iii).

(6)

Use of MSAs as fee schedule areas in California

(A)

In general

Subject to the succeeding provisions of this paragraph and notwithstanding the previous provisions of this subsection, for services furnished on or after January 1, 2017, the fee schedule areas used for payment under this section applicable to California shall be the following:

(i)

Each Metropolitan Statistical Area (each in this paragraph referred to as an “MSA”), as defined by the Director of the Office of Management and Budget as of December 31 of the previous year, shall be a fee schedule area.

(ii)

All areas not included in an MSA shall be treated as a single rest-of-State fee schedule area.

(B)

Transition for MSAs previously in rest-of-state payment locality or in locality 3

(i)

In general

For services furnished in California during a year beginning with 2017 and ending with 2021 in an MSA in a transition area (as defined in subparagraph (D)), subject to subparagraph (C), the geographic index values to be applied under this subsection for such year shall be equal to the sum of the following:

(I)

Current law component

(II)

MSA-based component

(ii)

Old weighting factor

The old weighting factor described in this clause—

(I)

for 2017, is ⅚; and

(II)

for each succeeding year, is the old weighting factor described in this clause for the previous year minus ⅙.

(iii)

MSA-based weighting factor

(C)

Hold harmless

(D)

Transition area defined

In this paragraph, the term “transition area” means each of the following fee schedule areas for 2013:

(i)

The rest-of-State payment locality.

(ii)

Payment locality 3.

(E)

References to fee schedule areas

(f)

Sustainable growth rate

(1)

Publication

The Secretary shall cause to have published in the Federal Register not later than—

(A)

November 1, 2000, the sustainable growth rate for 2000 and 2001; and

(B)

November 1 of each succeeding year through 2014 the sustainable growth rate for such succeeding year and each of the preceding 2 years.

(2)

Specification of growth rate

The sustainable growth rate for all physicians’ services for a fiscal year (beginning with fiscal year 1998 and ending with fiscal year 2000) and a year beginning with 2000 and ending with 2014 shall be equal to the product of—

(A)

1 plus the Secretary’s estimate of the weighted average percentage increase (divided by 100) in the fees for all physicians’ services in the applicable period involved,

(B)

1 plus the Secretary’s estimate of the percentage change (divided by 100) in the average number of individuals enrolled under this part (other than Medicare+Choice plan enrollees) from the previous applicable period to the applicable period involved,

(C)

1 plus the Secretary’s estimate of the annual average percentage growth in real gross domestic product per capita (divided by 100) during the 10-year period ending with the applicable period involved, and

(D)

1 plus the Secretary’s estimate of the percentage change (divided by 100) in expenditures for all physicians’ services in the applicable period (compared with the previous applicable period) which will result from changes in law and regulations, determined without taking into account estimated changes in expenditures resulting from the update adjustment factor determined under subsection (d)(3)(B) or (d)(4)(B), as the case may be,

minus 1 and multiplied by 100.

(3)

Data to be used

For purposes of determining the update adjustment factor under subsection (d)(4)(B) for a year beginning with 2001, the sustainable growth rates taken into consideration in the determination under paragraph (2) shall be determined as follows:

(A)

For 2001

(B)

For 2002

(C)

For 2003 and succeeding years

For purposes of such calculations for a year after 2002—

(i)

the sustainable growth rates for that year and the preceding 2 years shall be determined on the basis of the best data available to the Secretary as of September 1 of the year preceding the year for which the calculation is made; and

(ii)

the sustainable growth rate for any year before a year described in clause (i) shall be the rate as most recently determined for that year under this subsection.

Nothing in this paragraph shall be construed as affecting the sustainable growth rates established for fiscal year 1998 or fiscal year 1999.

(4)

Definitions

In this subsection:

(A)

Services included in physicians’ services

(B)

Medicare+Choice plan enrollee

(C)

Applicable period

The term “applicable period” means—

(i)

a fiscal year, in the case of fiscal year 1998, fiscal year 1999, and fiscal year 2000; or

(ii)

a calendar year with respect to a year beginning with 2000;

as the case may be.

(g)

Limitation on beneficiary liability

(1)

Limitation on actual charges

(A)

In general

In the case of a nonparticipating physician or nonparticipating supplier or other person (as defined in section 1395u(i)(2) of this title) who does not accept payment on an assignment-related basis for a physician’s service furnished with respect to an individual enrolled under this part, the following rules apply:

(i)

Application of limiting charge

(ii)

No liability for excess charges

(iii)

Correction of excess charges

(iv)

Refund of excess collections

(B)

Sanctions

If a physician, supplier, or other person—

(i)

knowingly and willfully bills or collects for services in violation of subparagraph (A)(i) on a repeated basis, or

(ii)

fails to comply with clause (iii) or (iv) of subparagraph (A) on a timely basis,

the Secretary may apply sanctions against the physician, supplier, or other person in accordance with paragraph (2) of section 1395u(j) of this title. In applying this subparagraph, paragraph (4) of such section applies in the same manner as such paragraph applies to such section and any reference in such section to a physician is deemed also to include a reference to a supplier or other person under this subparagraph.

(C)

Timely basis

(2)

“Limiting charge” defined

(A)

For 1991

For physicians’ services of a physician furnished during 1991, other than radiologist services subject to section 1395m(b) of this title, the “limiting charge” shall be the same percentage (or, if less, 25 percent) above the recognized payment amount under this part with respect to the physician (as a nonparticipating physician) as the percentage by which—

(i)

the maximum allowable actual charge (as determined under section 1395u(j)(1)(C) of this title as of December 31, 1990, or, if less, the maximum actual charge otherwise permitted for the service under this part as of such date) for the service of the physician, exceeds

(ii)

the recognized payment amount for the service of the physician (as a nonparticipating physician) as of such date.

In the case of evaluation and management services (as specified in section 1395u(b)(16)(B)(ii) of this title), the preceding sentence shall be applied by substituting “40 percent” for “25 percent”.

(B)

For 1992

For physicians’ services furnished during 1992, other than radiologist services subject to section 1395m(b) of this title, the “limiting charge” shall be the same percentage (or, if less, 20 percent) above the recognized payment amount under this part for nonparticipating physicians as the percentage by which—

(i)

the limiting charge (as determined under subparagraph (A) as of December 31, 1991) for the service, exceeds

(ii)

the recognized payment amount for the service for nonparticipating physicians as of such date.

(C)

After 1992

(D)

Recognized payment amount

(3)

Limitation on charges for medicare beneficiaries eligible for medicaid benefits

(A)

In general

(B)

Penalty

(4)

Physician submission of claims

(A)

In general

For services furnished on or after September 1, 1990, within 1 year after the date of providing a service for which payment is made under this part on a reasonable charge or fee schedule basis, a physician, supplier, or other person (or an employer or facility in the cases described in section 1395u(b)(6)(A) of this title)—

(i)

shall complete and submit a claim for such service on a standard claim form specified by the Secretary to the carrier on behalf of a beneficiary, and

(ii)

may not impose any charge relating to completing and submitting such a form.

(B)

Penalty

(i)

With respect to an assigned claim wherever a physician, provider, supplier or other person (or an employer or facility in the cases described in section 1395u(b)(6)(A) of this title) fails to submit such a claim as required in subparagraph (A), the Secretary shall reduce by 10 percent the amount that would otherwise be paid for such claim under this part.

(ii)

If a physician, supplier, or other person (or an employer or facility in the cases described in section 1395u(b)(6)(A) of this title) fails to submit a claim required to be submitted under subparagraph (A) or imposes a charge in violation of such subparagraph, the Secretary shall apply the sanction with respect to such a violation in the same manner as a sanction may be imposed under section 1395u(p)(3) of this title for a violation of section 1395u(p)(1) of this title.

(5)

Electronic billing; direct deposit

(6)

Monitoring of charges

(A)

In general

The Secretary shall monitor—

(i)

the actual charges of nonparticipating physicians for physicians’ services furnished on or after January 1, 1991, to individuals enrolled under this part, and

(ii)

changes (by specialty, type of service, and geographic area) in (I) the proportion of expenditures for physicians’ services provided under this part by participating physicians, (II) the proportion of expenditures for such services for which payment is made under this part on an assignment-related basis, and (III) the amounts charged above the recognized payment amounts under this part.

(B)

Report

(C)

Plan

(7)

Monitoring of utilization and access

(A)

In general

The Secretary shall monitor—

(i)

changes in the utilization of and access to services furnished under this part within geographic, population, and service related categories,

(ii)

possible sources of inappropriate utilization of services furnished under this part which contribute to the overall level of expenditures under this part, and

(iii)

factors underlying these changes and their interrelationships.

(B)

Report

(C)

Recommendations

The Secretary shall include in each annual report under subparagraph (B) recommendations—

(i)

addressing any identified patterns of inappropriate utilization,

(ii)

on utilization review,

(iii)

on physician education or patient education,

(iv)

addressing any problems of beneficiary access to care made evident by the monitoring process, and

(v)

on such other matters as the Secretary deems appropriate.

The Medicare Payment Advisory Commission shall comment on the Secretary’s recommendations and in developing its comments, the Commission shall convene and consult a panel of physician experts to evaluate the implications of medical utilization patterns for the quality of and access to patient care.

(h)

Sending information to physicians

(i)

Miscellaneous provisions

(1)

Restriction on administrative and judicial review

There shall be no administrative or judicial review under section 1395ff of this title or otherwise of—

(A)

the determination of the adjusted historical payment basis (as defined in subsection (a)(2)(D)(i)),

(B)

the determination of relative values and relative value units under subsection (c), including adjustments under subsections (c)(2)(F), (c)(2)(H), and (c)(2)(I) and section 13515(b) of the Omnibus Budget Reconciliation Act of 1993,

(C)

the determination of conversion factors under subsection (d), including without limitation a prospective redetermination of the sustainable growth rates for any or all previous fiscal years,

(D)

the establishment of geographic adjustment factors under subsection (e),

(E)

the establishment of the system for the coding of physicians’ services under this section, and

(F)

the collection and use of information in the determination of relative values under subsection (c)(2)(M).

(2)

Assistants-at-surgery

(A)

In general

(B)

Denial of payment in certain cases

(3)

No comparability adjustment

For physicians’ services for which payment under this part is determined under this section—

(A)

a carrier may not make any adjustment in the payment amount under section 1395u(b)(3)(B) of this title on the basis that the payment amount is higher than the charge applicable, for comparable services and under comparable circumstances, to the policyholders and subscribers of the carrier,

(B)

no payment adjustment may be made under section 1395u(b)(8) of this title, and

(C)

section 1395u(b)(9) of this title shall not apply.

(j)

Definitions

In this section:

(1)

Category

(2)

Fee schedule area

(3)

Physicians’ services

(4)

Practice expenses

(k)

Quality reporting system

(1)

In general

(2)

Use of consensus-based quality measures

(A)

For 2007

(i)

In general

(ii)

Subsequent refinements in application permitted

(iii)

Implementation

(B)

For 2008 and 2009

(i)

In general

(ii)

Proposed set of measures

(iii)

Final set of measures

(C)

For 2010 and subsequent years

(i)

In general

(ii)

Exception

(D)

Opportunity to provide input on measures for 2009 and subsequent years

(3)

Covered professional services and eligible professionals defined

For purposes of this subsection:

(A)

Covered professional services

(B)

Eligible professional

The term “eligible professional” means any of the following:

(i)

A physician.

(ii)

A practitioner described in section 1395u(b)(18)(C) of this title.

(iii)

A physical or occupational therapist or a qualified speech-language pathologist.

(iv)

Beginning with 2009, a qualified audiologist (as defined in section 1395x(ll)(3)(B) of this title).

(4)

Use of registry-based reporting

(5)

Identification units

(6)

Education and outreach

(7)

Limitations on review

(8)

Implementation

(9)

Continued application for purposes of MIPS and for certain professionals volunteering to report

The Secretary shall, in accordance with subsection (q)(1)(F), carry out the provisions of this subsection—

(A)

for purposes of subsection (q); and

(B)

for eligible professionals who are not MIPS eligible professionals (as defined in subsection (q)(1)(C)) for the year involved.

(l)

Physician Assistance and Quality Initiative Fund

(1)

Establishment

(2)

Funding

(A)

Amount available

(i)

In general

Subject to clause (ii), there shall be available to the Fund the following amounts:

(I)

For expenditures during 2008, an amount equal to $150,500,000.

(II)

For expenditures during 2009, an amount equal to $24,500,000.

(ii)

Limitations on expenditures

(I)

2008

(II)

2009

(B)

Timely obligation of all available funds for services

The Secretary shall provide for expenditures from the Fund in a manner designed to provide (to the maximum extent feasible) for the obligation of the entire amount available for expenditures, after application of subparagraph (A)(ii), during—

(i)

2008 for payment with respect to physicians’ services furnished during 2008; and

(ii)

2009 for payment with respect to physicians’ services furnished during 2009.

(C)

Payment from Trust Fund

(D)

Funding limitation

(E)

Construction

(m)

Incentive payments for quality reporting

(1)

Incentive payments

(A)

In general

For 2007 through 2014, with respect to covered professional services furnished during a reporting period by an eligible professional, if—

(i)

there are any quality measures that have been established under the physician reporting system that are applicable to any such services furnished by such professional for such reporting period; and

(ii)

the eligible professional satisfactorily submits (as determined under this subsection) to the Secretary data on such quality measures in accordance with such reporting system for such reporting period,

in addition to the amount otherwise paid under this part, there also shall be paid to the eligible professional (or to an employer or facility in the cases described in clause (A) of section 1395u(b)(6) of this title) or, in the case of a group practice under paragraph (3)(C), to the group practice, from the Federal Supplementary Medical Insurance Trust Fund established under section 1395t of this title an amount equal to the applicable quality percent of the Secretary’s estimate (based on claims submitted not later than 2 months after the end of the reporting period) of the allowed charges under this part for all such covered professional services furnished by the eligible professional (or, in the case of a group practice under paragraph (3)(C), by the group practice) during the reporting period.

(B)

Applicable quality percent

For purposes of subparagraph (A), the term “applicable quality percent” means—

(i)

for 2007 and 2008, 1.5 percent;

(ii)

for 2009 and 2010, 2.0 percent;

(iii)

for 2011, 1.0 percent; and

(iv)

for 2012, 2013, and 2014, 0.5 percent.

(2)

Incentive payments for electronic prescribing

(A)

In general

(B)

Limitation with respect to electronic prescribing quality measures

The provisions of this paragraph and subsection (a)(5) shall not apply to an eligible professional (or, in the case of a group practice under paragraph (3)(C), to the group practice) if, for the reporting period (or, for purposes of subsection (a)(5), for the reporting period for a year)—

(i)

the allowed charges under this part for all covered professional services furnished by the eligible professional (or group, as applicable) for the codes to which the electronic prescribing quality measure applies (as identified by the Secretary and published on the Internet website of the Centers for Medicare & Medicaid Services as of January 1, 2008, and as subsequently modified by the Secretary) are less than 10 percent of the total of the allowed charges under this part for all such covered professional services furnished by the eligible professional (or the group, as applicable); or

(ii)

if determined appropriate by the Secretary, the eligible professional does not submit (including both electronically and nonelectronically) a sufficient number (as determined by the Secretary) of prescriptions under part D.

If the Secretary makes the determination to apply clause (ii) for a period, then clause (i) shall not apply for such period.

(C)

Applicable electronic prescribing percent

For purposes of subparagraph (A), the term “applicable electronic prescribing percent” means—

(i)

for 2009 and 2010, 2.0 percent;

(ii)

for 2011 and 2012, 1.0 percent; and

(iii)

for 2013, 0.5 percent.

(D)

Limitation with respect to EHR incentive payments

(3)

Satisfactory reporting and successful electronic prescriber described

(A)

In general

For purposes of paragraph (1), an eligible professional shall be treated as satisfactorily submitting data on quality measures for covered professional services for a reporting period (or, for purposes of subsection (a)(8), for the quality reporting period for the year) if quality measures have been reported as follows:

(i)

Three or fewer quality measures applicable

(ii)

Four or more quality measures applicable

For years after 2008, quality measures for purposes of this subparagraph shall not include electronic prescribing quality measures.

(B)

Successful electronic prescriber

(i)

In general

(ii)

Requirement for submitting data on electronic prescribing quality measures

(iii)

Requirement for electronically prescribing under part D

(iv)

Use of part D data

(v)

Standards for electronic prescribing

(C)

Satisfactory reporting measures for group practices

(i)

In general

(ii)

Statistical sampling model

(iii)

No double payments

(D)

Satisfactory reporting measures through participation in a qualified clinical data registry

(E)

Qualified clinical data registry

(i)

In general

(ii)

Considerations

In establishing the requirements under clause (i), the Secretary shall consider whether an entity—

(I)

has in place mechanisms for the transparency of data elements and specifications, risk models, and measures;

(II)

requires the submission of data from participants with respect to multiple payers;

(III)

provides timely performance reports to participants at the individual participant level; and

(IV)

supports quality improvement initiatives for participants.

(iii)

Measures

With respect to measures used by a qualified clinical data registry—

(I)

sections 1395aaa(b)(7) and 1395aaa–1(a) of this title shall not apply; and

(II)

measures endorsed by the entity with a contract with the Secretary under section 1395aaa(a) of this title may be used.

(iv)

Consultation

(v)

Determination

The Secretary shall establish a process to determine whether or not an entity meets the requirements established under clause (i). Such process may involve one or both of the following:

(I)

A determination by the Secretary.

(II)

A designation by the Secretary of one or more independent organizations to make such determination.

(F)

Authority to revise satisfactorily reporting data

(4)

Form of payment

(5)

Application

(A)

Physician reporting system rules

(B)

Coordination with other bonus payments

(C)

Implementation

(D)

Validation

(i)

In general

(ii)

Method

(iii)

Denial of payment authority

(E)

Limitations on review

Except as provided in subparagraph (I), there shall be no administrative or judicial review under section 1395ff of this title, section 1395oo of this title, or otherwise of—

(i)

the determination of measures applicable to services furnished by eligible professionals under this subsection;

(ii)

the determination of satisfactory reporting under this subsection;

(iii)

the determination of a successful electronic prescriber under paragraph (3), the limitation under paragraph (2)(B), and the exception under subsection (a)(5)(B); and

(iv)

the determination of any incentive payment under this subsection and the payment adjustment under paragraphs (5)(A) and (8)(A) of subsection (a).

(F)

Extension

(G)

Posting on website

The Secretary shall post on the Internet website of the Centers for Medicare & Medicaid Services, in an easily understandable format, a list of the names of the following:

(i)

The eligible professionals (or, in the case of reporting under paragraph (3)(C), the group practices) who satisfactorily submitted data on quality measures under this subsection.

(ii)

The eligible professionals (or, in the case of reporting under paragraph (3)(C), the group practices) who are successful electronic prescribers.

(H)

Feedback

(I)

Informal appeals process

(6)

Definitions

For purposes of this subsection:

(A)

Eligible professional; covered professional services

(B)

Physician reporting system

(C)

Reporting period

(i)

In general

Subject to clauses (ii) and (iii), the term “reporting period” means—

(I)

for 2007, the period beginning on July 1, 2007, and ending on December 31, 2007; and

(II)

for 2008 and subsequent years, the entire year.

(ii)

Authority to revise reporting period

(iii)

Reference

(7)

Integration of physician quality reporting and EHR reporting

Not later than January 1, 2012, the Secretary shall develop a plan to integrate reporting on quality measures under this subsection with reporting requirements under subsection (o) relating to the meaningful use of electronic health records. Such integration shall consist of the following:

(A)

The selection of measures, the reporting of which would both demonstrate—

(i)

meaningful use of an electronic health record for purposes of subsection (o); and

(ii)

quality of care furnished to an individual.

(B)

Such other activities as specified by the Secretary.

(8)

Additional incentive payment

(A)

In general

(B)

Requirements described

In order to qualify for the additional incentive payment described in subparagraph (A), an eligible professional shall meet the following requirements:

(i)

The eligible professional shall—

(I)

satisfactorily submit data on quality measures for purposes of paragraph (1) for a year; and

(II)

have such data submitted on their behalf through a Maintenance of Certification Program (as defined in subparagraph (C)(i)) that meets—

(aa)

the criteria for a registry (as described in subsection (k)(4)); or

(bb)

an alternative form and manner determined appropriate by the Secretary.

(ii)

The eligible professional, more frequently than is required to qualify for or maintain board certification status—

(I)

participates in such a Maintenance of Certification program for a year; and

(II)

successfully completes a qualified Maintenance of Certification Program practice assessment (as defined in subparagraph (C)(ii)) for such year.

(iii)

A Maintenance of Certification program submits to the Secretary, on behalf of the eligible professional, information—

(I)

in a form and manner specified by the Secretary, that the eligible professional has successfully met the requirements of clause (ii) (which may be in the form of a structural measure);

(II)

if requested by the Secretary, on the survey of patient experience with care (as described in subparagraph (C)(ii)(II)); and

(III)

as the Secretary may require, on the methods, measures, and data used under the Maintenance of Certification Program and the qualified Maintenance of Certification Program practice assessment.

(C)

Definitions

For purposes of this paragraph:

(i)

The term “Maintenance of Certification Program” means a continuous assessment program, such as qualified American Board of Medical Specialties Maintenance of Certification program or an equivalent program (as determined by the Secretary), that advances quality and the lifelong learning and self-assessment of board certified specialty physicians by focusing on the competencies of patient care, medical knowledge, practice-based learning, interpersonal and communication skills and professionalism. Such a program shall include the following:

(I)

The program requires the physician to maintain a valid, unrestricted medical license in the United States.

(II)

The program requires a physician to participate in educational and self-assessment programs that require an assessment of what was learned.

(III)

The program requires a physician to demonstrate, through a formalized, secure examination, that the physician has the fundamental diagnostic skills, medical knowledge, and clinical judgment to provide quality care in their respective specialty.

(IV)

The program requires successful completion of a qualified Maintenance of Certification Program practice assessment as described in clause (ii).

(ii)

The term “qualified Maintenance of Certification Program practice assessment” means an assessment of a physician’s practice that—

(I)

includes an initial assessment of an eligible professional’s practice that is designed to demonstrate the physician’s use of evidence-based medicine;

(II)

includes a survey of patient experience with care; and

(III)

requires a physician to implement a quality improvement intervention to address a practice weakness identified in the initial assessment under subclause (I) and then to remeasure to assess performance improvement after such intervention.

(9)

Continued application for purposes of MIPS and for certain professionals volunteering to report

The Secretary shall, in accordance with subsection (q)(1)(F), carry out the processes under this subsection—

(A)

for purposes of subsection (q); and

(B)

for eligible professionals who are not MIPS eligible professionals (as defined in subsection (q)(1)(C)) for the year involved.

(n)

Physician Feedback Program

(1)

Establishment

(A)

In general

(i)

Establishment

(ii)

Reports on resources

(iii)

Inclusion of certain information

(B)

Resource use

The resources described in subparagraph (A)(ii) may be measured—

(i)

on an episode basis;

(ii)

on a per capita basis; or

(iii)

on both an episode and a per capita basis.

(2)

Implementation

(3)

Data for reports

(4)

Authority to focus initial application

The Secretary may focus the initial application of the Program as appropriate, such as focusing the Program on—

(A)

physician specialties that account for a certain percentage of all spending for physicians’ services under this subchapter;

(B)

physicians who treat conditions that have a high cost or a high volume, or both, under this subchapter;

(C)

physicians who use a high amount of resources compared to other physicians;

(D)

physicians practicing in certain geographic areas; or

(E)

physicians who treat a minimum number of individuals under this subchapter.

(5)

Authority to exclude certain information if insufficient information

(6)

Adjustment of data

(7)

Education and outreach

(8)

Disclosure exemption

(9)

Reports on utilization

(A)

Development of episode grouper

(i)

In general

(ii)

Timeline for development

(iii)

Public availability

(iv)

Endorsement

(B)

Reports on utilization

(C)

Analysis of data

The Secretary shall, for purposes of preparing reports under this paragraph, establish methodologies as appropriate, such as to—

(i)

attribute episodes of care, in whole or in part, to physicians;

(ii)

identify appropriate physicians for purposes of comparison under subparagraph (B); and

(iii)

aggregate episodes of care attributed to a physician under clause (i) into a composite measure per individual.

(D)

Data adjustment

In preparing reports under this paragraph, the Secretary shall make appropriate adjustments, including adjustments—

(i)

to account for differences in socioeconomic and demographic characteristics, ethnicity, and health status of individuals (such as to recognize that less healthy individuals may require more intensive interventions); and

(ii)

to eliminate the effect of geographic adjustments in payment rates (as described in subsection (e)).

(E)

Public availability of methodology

The Secretary shall make available to the public—

(i)

the methodologies established under subparagraph (C);

(ii)

information regarding any adjustments made to data under subparagraph (D); and

(iii)

aggregate reports with respect to physicians.

(F)

Definition of physician

In this paragraph:

(i)

In general

(ii)

Treatment of groups

(G)

Limitations on review

(10)

Coordination with other value-based purchasing reforms

(11)

Reports ending with 2017

(o)

Incentives for adoption and meaningful use of certified EHR technology

(1)

Incentive payments

(A)

In general

(i)

In general

(ii)

No incentive payments with respect to years after 2016

(B)

Limitations on amounts of incentive payments

(i)

In general

(ii)

Amount

Subject to clauses (iii) through (v), the applicable amount specified in this subparagraph for an eligible professional is as follows:

(I)

For the first payment year for such professional, $15,000 (or, if the first payment year for such eligible professional is 2011 or 2012, $18,000).

(II)

For the second payment year for such professional, $12,000.

(III)

For the third payment year for such professional, $8,000.

(IV)

For the fourth payment year for such professional, $4,000.

(V)

For the fifth payment year for such professional, $2,000.

(VI)

For any succeeding payment year for such professional, $0.

(iii)

Phase down for eligible professionals first adopting EHR after 2013

(iv)

Increase for certain eligible professionals

(v)

No incentive payment if first adopting after 2014

(C)

Non-application to hospital-based eligible professionals

(i)

In general

(ii)

Hospital-based eligible professional

(D)

Payment

(i)

Form of payment

(ii)

Coordination of application of limitation for professionals in different practices

(iii)

Coordination with Medicaid

(E)

Payment year defined

(i)

In general

(ii)

First, second, etc. payment year

(2)

Meaningful EHR user

(A)

In general

An eligible professional shall be treated as a meaningful EHR user for an EHR reporting period for a payment year (or, for purposes of subsection (a)(7), for an EHR reporting period under such subsection for a year, or pursuant to subparagraph (D) for purposes of subsection (q), for a performance period under such subsection for a year) if each of the following requirements is met:

(i)

Meaningful use of certified EHR technology

(ii)

Information exchange

(iii)

Reporting on measures using EHR

The Secretary may provide for the use of alternative means for meeting the requirements of clauses (i), (ii), and (iii) in the case of an eligible professional furnishing covered professional services in a group practice (as defined by the Secretary). The Secretary shall seek to improve the use of electronic health records and health care quality over time.

(B)

Reporting on measures

(i)

Selection

The Secretary shall select measures for purposes of subparagraph (A)(iii) but only consistent with the following:

(I)

The Secretary shall provide preference to clinical quality measures that have been endorsed by the entity with a contract with the Secretary under section 1395aaa(a) of this title.

(II)

Prior to any measure being selected under this subparagraph, the Secretary shall publish in the Federal Register such measure and provide for a period of public comment on such measure.

(ii)

Limitation

(iii)

Coordination of reporting of information

(C)

Demonstration of meaningful use of certified EHR technology and information exchange

(i)

In general

A professional may satisfy the demonstration requirement of clauses (i) and (ii) of subparagraph (A) through means specified by the Secretary, which may include—

(I)

an attestation;

(II)

the submission of claims with appropriate coding (such as a code indicating that a patient encounter was documented using certified EHR technology);

(III)

a survey response;

(IV)

reporting under subparagraph (A)(iii); and

(V)

other means specified by the Secretary.

(ii)

Use of part D data

(D)

Continued application for purposes of MIPS

(3)

Application

(A)

Physician reporting system rules

(B)

Coordination with other payments

(C)

Limitations on review

There shall be no administrative or judicial review under section 1395ff of this title, section 1395oo of this title, or otherwise, of—

(i)

the methodology and standards for determining payment amounts under this subsection and payment adjustments under subsection (a)(7)(A), including the limitation under paragraph (1)(B) and coordination under clauses (ii) and (iii) of paragraph (1)(D);

(ii)

the methodology and standards for determining a meaningful EHR user under paragraph (2), including selection of measures under paragraph (2)(B), specification of the means of demonstrating meaningful EHR use under paragraph (2)(C), and the hardship exception under subsection (a)(7)(B);

(iii)

the methodology and standards for determining a hospital-based eligible professional under paragraph (1)(C); and

(iv)

the specification of reporting periods under paragraph (5) and the selection of the form of payment under paragraph (1)(D)(i).

(D)

Posting on website

(4)

Certified EHR technology defined

(5)

Definitions

For purposes of this subsection:

(A)

Covered professional services

(B)

EHR reporting period

(C)

Eligible professional

(p)

Establishment of value-based payment modifier

(1)

In general

(2)

Quality

(A)

In general

(B)

Measures

(i)

The Secretary shall establish appropriate measures of the quality of care furnished by a physician or group of physicians to individuals enrolled under this part, such as measures that reflect health outcomes. Such measures shall be risk adjusted as determined appropriate by the Secretary.

(ii)

The Secretary shall seek endorsement of the measures established under this subparagraph by the entity with a contract under section 1395aaa(a) of this title.

(C)

Continued application for purposes of MIPS

(3)

Costs

(4)

Implementation

(A)

Publication of measures, dates of implementation, performance period

Not later than January 1, 2012, the Secretary shall publish the following:

(i)

The measures of quality of care and costs established under paragraphs (2) and (3), respectively.

(ii)

The dates for implementation of the payment modifier (as determined under subparagraph (B)).

(iii)

The initial performance period (as specified under subparagraph (B)(ii)).

(B)

Deadlines for implementation

(i)

Initial implementation

(ii)

Initial performance period

(I)

In general

(II)

Provision of information during initial performance period

(iii)

Application

(C)

Budget neutrality

(5)

Systems-based care

(6)

Consideration of special circumstances of certain providers

(7)

Application

(8)

Definitions

For purposes of this subsection:

(A)

Costs

(B)

Performance period

(9)

Coordination with other value-based purchasing reforms

(10)

Limitations on review

There shall be no administrative or judicial review under section 1395ff of this title, section 1395oo of this title, or otherwise of—

(A)

the establishment of the value-based payment modifier under this subsection;

(B)

the evaluation of quality of care under paragraph (2), including the establishment of appropriate measures of the quality of care under paragraph (2)(B);

(C)

the evaluation of costs under paragraph (3), including the establishment of appropriate measures of costs under such paragraph;

(D)

the dates for implementation of the value-based payment modifier;

(E)

the specification of the initial performance period and any other performance period under paragraphs (4)(B)(ii) and (8)(B), respectively;

(F)

the application of the value-based payment modifier under paragraph (7); and

(G)

the determination of costs under paragraph (8)(A).

(q)

Merit-based Incentive Payment System

(1)

Establishment

(A)

In general

Subject to the succeeding provisions of this subsection, the Secretary shall establish an eligible professional Merit-based Incentive Payment System (in this subsection referred to as the “MIPS”) under which the Secretary shall—

(i)

develop a methodology for assessing the total performance of each MIPS eligible professional according to performance standards under paragraph (3) for a performance period (as established under paragraph (4)) for a year;

(ii)

using such methodology, provide for a composite performance score in accordance with paragraph (5) for each such professional for each performance period; and

(iii)

use such composite performance score of the MIPS eligible professional for a performance period for a year to determine and apply a MIPS adjustment factor (and, as applicable, an additional MIPS adjustment factor) under paragraph (6) to the professional for the year.

Notwithstanding subparagraph (C)(ii), under the MIPS, the Secretary shall permit any eligible professional (as defined in subsection (k)(3)(B)) to report on applicable measures and activities described in paragraph (2)(B).

(B)

Program implementation

(C)

MIPS eligible professional defined

(i)

In general

For purposes of this subsection, subject to clauses (ii) and (iv), the term “MIPS eligible professional” means—

(I)

for the first and second years for which the MIPS applies to payments (and for the performance period for such first and second year), a physician (as defined in section 1395x(r) of this title), a physician assistant, nurse practitioner, and clinical nurse specialist (as such terms are defined in section 1395x(aa)(5) of this title), a certified registered nurse anesthetist (as defined in section 1395x(bb)(2) of this title), and a group that includes such professionals; and

(II)

for the third year for which the MIPS applies to payments (and for the performance period for such third year) and for each succeeding year (and for the performance period for each such year), the professionals described in subclause (I), such other eligible professionals (as defined in subsection (k)(3)(B)) as specified by the Secretary, and a group that includes such professionals.

(ii)

Exclusions

For purposes of clause (i), the term “MIPS eligible professional” does not include, with respect to a year, an eligible professional (as defined in subsection (k)(3)(B)) who—

(I)

is a qualifying APM participant (as defined in section 1395l(z)(2) of this title);

(II)

subject to clause (vii), is a partial qualifying APM participant (as defined in clause (iii)) for the most recent period for which data are available and who, for the performance period with respect to such year, does not report on applicable measures and activities described in paragraph (2)(B) that are required to be reported by such a professional under the MIPS; or

(III)

for the performance period with respect to such year, does not exceed the low-volume threshold measurement selected under clause (iv).

(iii)

Partial qualifying APM participant

For purposes of this subparagraph, the term “partial qualifying APM participant” means, with respect to a year, an eligible professional for whom the Secretary determines the minimum payment percentage (or percentages), as applicable, described in paragraph (2) of section 1395l(z) of this title for such year have not been satisfied, but who would be considered a qualifying APM participant (as defined in such paragraph) for such year if—

(I)

with respect to 2019 and 2020, the reference in subparagraph (A) of such paragraph to 25 percent was instead a reference to 20 percent;

(II)

with respect to each of 2021 through 2026—

(aa)

the reference in subparagraph (B)(i) of such paragraph to 50 percent was instead a reference to 40 percent; and

(bb)

the references in subparagraph (B)(ii) of such paragraph to 50 percent and 25 percent of such paragraph ⁷ were instead references to 40 percent and 20 percent, respectively; and

(III)

with respect to 2027 and subsequent years—

(aa)

the reference in subparagraph (C)(i) of such paragraph to 75 percent was instead a reference to 50 percent; and

(bb)

the references in subparagraph (C)(ii) of such paragraph to 75 percent and 25 percent of such paragraph ⁷ were instead references to 50 percent and 20 percent, respectively.

(iv)

Selection of low-volume threshold measurement

The Secretary shall select a low-volume threshold to apply for purposes of clause (ii)(III), which may include one or more or a combination of the following:

(I)

The minimum number (as determined by the Secretary) of—

(aa)

for performance periods beginning before January 1, 2018, individuals enrolled under this part who are treated by the eligible professional for the performance period involved; and

(bb)

for performance periods beginning on or after January 1, 2018, individuals enrolled under this part who are furnished covered professional services (as defined in subsection (k)(3)(A)) by the eligible professional for the performance period involved.

(II)

The minimum number (as determined by the Secretary) of covered professional services (as defined in subsection (k)(3)(A)) furnished to individuals enrolled under this part by such professional for such performance period.

(III)

The minimum amount (as determined by the Secretary) of—

(aa)

for performance periods beginning before January 1, 2018, allowed charges billed by such professional under this part for such performance period; and

(bb)

for performance periods beginning on or after January 1, 2018, allowed charges for covered professional services (as defined in subsection (k)(3)(A)) billed by such professional for such performance period.

(v)

Treatment of new Medicare enrolled eligible professionals

(vi)

Clarification

(vii)

Partial qualifying APM participant clarifications

(I)

Treatment as MIPS eligible professional

(II)

Not eligible for qualifying APM participant payments

(D)

Application to group practices

(i)

In general

Under the MIPS:

(I)

Quality performance category

(II)

Other performance categories

(ii)

Ensuring comprehensiveness of group practice assessment

(E)

Use of registries

(F)

Application of certain provisions

In applying a provision of subsection (k), (m), (o), or (p) for purposes of this subsection, the Secretary shall—

(i)

adjust the application of such provision to ensure the provision is consistent with the provisions of this subsection; and

(ii)

not apply such provision to the extent that the provision is duplicative with a provision of this subsection.

(G)

Accounting for risk factors

(i)

Risk factors

Taking into account the relevant studies conducted and recommendations made in reports under section 2(d) of the Improving Medicare Post-Acute Care Transformation Act of 2014, and, as appropriate, other information, including information collected before completion of such studies and recommendations, the Secretary, on an ongoing basis, shall, as the Secretary determines appropriate and based on an individual’s health status and other risk factors—

(I)

assess appropriate adjustments to quality measures, resource use measures, and other measures used under the MIPS; and

(II)

assess and implement appropriate adjustments to payment adjustments, composite performance scores, scores for performance categories, or scores for measures or activities under the MIPS.

(2)

Measures and activities under performance categories

(A)

Performance categories

Under the MIPS, the Secretary shall use the following performance categories (each of which is referred to in this subsection as a performance category) in determining the composite performance score under paragraph (5):

(i)

Quality.

(ii)

Resource use.

(iii)

Clinical practice improvement activities.

(iv)

Meaningful use of certified EHR technology.

(B)

Measures and activities specified for each category

For purposes of paragraph (3)(A) and subject to subparagraph (C), measures and activities specified for a performance period (as established under paragraph (4)) for a year are as follows:

(i)

Quality

(ii)

Resource use

(iii)

Clinical practice improvement activities

For the performance category described in subparagraph (A)(iii), clinical practice improvement activities (as defined in subparagraph (C)(v)(III)) under subcategories specified by the Secretary for such period, which shall include at least the following:

(I)

The subcategory of expanded practice access, such as same day appointments for urgent needs and after hours access to clinician advice.

(II)

The subcategory of population management, such as monitoring health conditions of individuals to provide timely health care interventions or participation in a qualified clinical data registry.

(III)

The subcategory of care coordination, such as timely communication of test results, timely exchange of clinical information to patients and other providers, and use of remote monitoring or telehealth.

(IV)

The subcategory of beneficiary engagement, such as the establishment of care plans for individuals with complex care needs, beneficiary self-management assessment and training, and using shared decision-making mechanisms. This subcategory shall include as an activity, for performance periods beginning on or after January 1, 2022, use of a real-time benefit tool as described in section 1395w–104(o) of this title. The Secretary may establish this activity as a standalone or as a component of another activity.

(V)

The subcategory of patient safety and practice assessment, such as through use of clinical or surgical checklists and practice assessments related to maintaining certification.

(VI)

The subcategory of participation in an alternative payment model (as defined in section 1395l(z)(3)(C) of this title).

In establishing activities under this clause, the Secretary shall give consideration to the circumstances of small practices (consisting of 15 or fewer professionals) and practices located in rural areas and in health professional shortage areas (as designated under section 254e(a)(1)(A) of this title).

(iv)

Meaningful EHR use

(C)

Additional provisions

(i)

Emphasizing outcome measures under the quality performance category

(ii)

Application of additional system measures

(iii)

Global and population-based measures

(iv)

Application of measures and activities to non-patient-facing professionals

In carrying out this paragraph, with respect to measures and activities specified in subparagraph (B) for performance categories described in subparagraph (A), the Secretary—

(I)

shall give consideration to the circumstances of professional types (or subcategories of those types determined by practice characteristics) who typically furnish services that do not involve face-to-face interaction with a patient; and

(II)

may, to the extent feasible and appropriate, take into account such circumstances and apply under this subsection with respect to MIPS eligible professionals of such professional types or subcategories, alternative measures or activities that fulfill the goals of the applicable performance category.

In carrying out the previous sentence, the Secretary shall consult with professionals of such professional types or subcategories.

(v)

Clinical practice improvement activities

(I)

Request for information

(II)

Contract authority for clinical practice improvement activities performance category

In applying subparagraph (B)(iii), the Secretary may contract with entities to assist the Secretary in—

(aa)

identifying activities described in subparagraph (B)(iii);

(bb)

specifying criteria for such activities; and

(cc)

determining whether a MIPS eligible professional meets such criteria.

(III)

Clinical practice improvement activities defined

(D)

Annual list of quality measures available for MIPS assessment

(i)

In general

Under the MIPS, the Secretary, through notice and comment rulemaking and subject to the succeeding clauses of this subparagraph, shall, with respect to the performance period for a year, establish an annual final list of quality measures from which MIPS eligible professionals may choose for purposes of assessment under this subsection for such performance period. Pursuant to the previous sentence, the Secretary shall—

(I)

not later than November 1 of the year prior to the first day of the first performance period under the MIPS, establish and publish in the Federal Register a final list of quality measures; and

(II)

not later than November 1 of the year prior to the first day of each subsequent performance period, update the final list of quality measures from the previous year (and publish such updated final list in the Federal Register), by—

(aa)

removing from such list, as appropriate, quality measures, which may include the removal of measures that are no longer meaningful (such as measures that are topped out);

(bb)

adding to such list, as appropriate, new quality measures; and

(cc)

determining whether or not quality measures on such list that have undergone substantive changes should be included in the updated list.

(ii)

Call for quality measures

(I)

In general

(II)

Eligible professional organization defined

(iii)

Requirements

In selecting quality measures for inclusion in the annual final list under clause (i), the Secretary shall—

(I)

provide that, to the extent practicable, all quality domains (as defined in subsection (s)(1)(B)) are addressed by such measures; and

(II)

ensure that such selection is consistent with the process for selection of measures under subsections (k), (m), and (p)(2).

(iv)

Peer review

(v)

Measures for inclusion

The final list of quality measures published under clause (i) shall include, as applicable, measures under subsections (k), (m), and (p)(2), including quality measures from among—

(I)

measures endorsed by a consensus-based entity;

(II)

measures developed under subsection (s); and

(III)

measures submitted under clause (ii)(I).

Any measure selected for inclusion in such list that is not endorsed by a consensus-based entity shall have a focus that is evidence-based.

(vi)

Exception for qualified clinical data registry measures

(vii)

Exception for existing quality measures

Any quality measure specified by the Secretary under subsection (k) or (m), including under subsection (m)(3)(E), and any measure of quality of care established under subsection (p)(2) for the reporting period or performance period under the respective subsection beginning before the first performance period under the MIPS—

(I)

shall not be subject to the requirements under clause (i) (except under items (aa) and (cc) of subclause (II) of such clause) or to the requirement under clause (iv); and

(II)

shall be included in the final list of quality measures published under clause (i) unless removed under clause (i)(II)(aa).

(viii)

Consultation with relevant eligible professional organizations and other relevant stakeholders

(ix)

Optional application

(3)

Performance standards

(A)

Establishment

(B)

Considerations in establishing standards

In establishing such performance standards with respect to measures and activities specified under paragraph (2)(B), the Secretary shall consider the following:

(i)

Historical performance standards.

(ii)

Improvement.

(iii)

The opportunity for continued improvement.

(4)

Performance period

(5)

Composite performance score

(A)

In general

(B)

Incentive to report; encouraging use of certified EHR technology for reporting quality measures

(i)

Incentive to report

(ii)

Encouraging use of certified EHR technology and qualified clinical data registries for reporting quality measures

Under the methodology established under subparagraph (A), the Secretary shall—

(I)

encourage MIPS eligible professionals to report on applicable measures with respect to the performance category described in paragraph (2)(A)(i) through the use of certified EHR technology and qualified clinical data registries; and

(II)

with respect to a performance period, with respect to a year, for which a MIPS eligible professional reports such measures through the use of such EHR technology, treat such professional as satisfying the clinical quality measures reporting requirement described in subsection (o)(2)(A)(iii) for such year.

(C)

Clinical practice improvement activities performance score

(i)

Rule for certification

(ii)

APM participation

(iii)

Subcategories

(D)

Achievement and improvement

(i)

Taking into account improvement

Beginning with the second year to which the MIPS applies, in addition to the achievement of a MIPS eligible professional, if data sufficient to measure improvement is available, the methodology developed under subparagraph (A)—

(I)

in the case of the performance score for the performance category described in clauses (i) and (ii) of paragraph (2)(A), subject to clause (iii), shall take into account the improvement of the professional; and

(II)

in the case of performance scores for other performance categories, may take into account the improvement of the professional.

(ii)

Assigning higher weight for achievement

(iii)

Transition years

(E)

Weights for the performance categories

(i)

In general

Under the methodology developed under subparagraph (A), subject to subparagraph (F)(i) and clause (ii), the composite performance score shall be determined as follows:

(I)

Quality

(aa)

In general

(bb)

First 5 years

(II)

Resource use

(aa)

In general

(bb)

First 5 years

(III)

Clinical practice improvement activities

(IV)

Meaningful use of certified EHR technology

(ii)

Authority to adjust percentages in case of high EHR meaningful use adoption

(F)

Certain flexibility for weighting performance categories, measures, and activities

Under the methodology under subparagraph (A), if there are not sufficient measures and activities (described in paragraph (2)(B)) applicable and available to each type of eligible professional involved, the Secretary shall assign different scoring weights (including a weight of 0)—

(i)

which may vary from the scoring weights specified in subparagraph (E), for each performance category based on the extent to which the category is applicable to the type of eligible professional involved; and

(ii)

for each measure and activity specified under paragraph (2)(B) with respect to each such category based on the extent to which the measure or activity is applicable and available to the type of eligible professional involved.

(G)

Resource use

(H)

Inclusion of quality measure data from other payers

(I)

Use of voluntary virtual groups for certain assessment purposes

(i)

In general

In the case of MIPS eligible professionals electing to be a virtual group under clause (ii) with respect to a performance period for a year, for purposes of applying the methodology under subparagraph (A) with respect to the performance categories described in clauses (i) and (ii) of paragraph (2)(A)—

(I)

the assessment of performance provided under such methodology with respect to such performance categories that is to be applied to each such professional in such group for such performance period shall be with respect to the combined performance of all such professionals in such group for such period; and

(II)

with respect to the composite performance score provided under this paragraph for such performance period for each such MIPS eligible professional in such virtual group, the components of the composite performance score that assess performance with respect to such performance categories shall be based on the assessment of the combined performance under subclause (I) for such performance categories and performance period.

(ii)

Election of practices to be a virtual group

(iii)

Requirements

The requirements for the process under clause (ii) shall—

(I)

provide that an election under such clause, with respect to a performance period, shall be made before the beginning of such performance period and may not be changed during such performance period;

(II)

provide that an individual MIPS eligible professional and a group practice described in clause (ii) may elect to be in no more than one virtual group for a performance period and that, in the case of such a group practice that elects to be in such virtual group for such performance period, such election applies to all MIPS eligible professionals in such group practice;

(III)

provide that a virtual group be a combination of tax identification numbers;

(IV)

provide for formal written agreements among MIPS eligible professionals electing to be a virtual group under this subparagraph; and

(V)

include such other requirements as the Secretary determines appropriate.

(6)

MIPS payments

(A)

MIPS adjustment factor

Taking into account paragraph (1)(G), the Secretary shall specify a MIPS adjustment factor for each MIPS eligible professional for a year. Such MIPS adjustment factor for a MIPS eligible professional for a year shall be in the form of a percent and shall be determined—

(i)

by comparing the composite performance score of the eligible professional for such year to the performance threshold established under subparagraph (D)(i) for such year;

(ii)

in a manner such that the adjustment factors specified under this subparagraph for a year result in differential payments under this paragraph reflecting that—

(I)

MIPS eligible professionals with composite performance scores for such year at or above such performance threshold for such year receive zero or positive payment adjustment factors for such year in accordance with clause (iii), with such professionals having higher composite performance scores receiving higher adjustment factors; and

(II)

MIPS eligible professionals with composite performance scores for such year below such performance threshold for such year receive negative payment adjustment factors for such year in accordance with clause (iv), with such professionals having lower composite performance scores receiving lower adjustment factors;

(iii)

in a manner such that MIPS eligible professionals with composite scores described in clause (ii)(I) for such year, subject to clauses (i) and (ii) of subparagraph (F), receive a zero or positive adjustment factor on a linear sliding scale such that an adjustment factor of 0 percent is assigned for a score at the performance threshold and an adjustment factor of the applicable percent specified in subparagraph (B) is assigned for a score of 100; and

(iv)

in a manner such that—

(I)

subject to subclause (II), MIPS eligible professionals with composite performance scores described in clause (ii)(II) for such year receive a negative payment adjustment factor on a linear sliding scale such that an adjustment factor of 0 percent is assigned for a score at the performance threshold and an adjustment factor of the negative of the applicable percent specified in subparagraph (B) is assigned for a score of 0; and

(II)

MIPS eligible professionals with composite performance scores that are equal to or greater than 0, but not greater than ¼ of the performance threshold specified under subparagraph (D)(i) for such year, receive a negative payment adjustment factor that is equal to the negative of the applicable percent specified in subparagraph (B) for such year.

(B)

Applicable percent defined

For purposes of this paragraph, the term “applicable percent” means—

(i)

for 2019, 4 percent;

(ii)

for 2020, 5 percent;

(iii)

for 2021, 7 percent; and

(iv)

for 2022 and subsequent years, 9 percent.

(C)

Additional MIPS adjustment factors for exceptional performance

(D)

Establishment of performance thresholds

(i)

Performance threshold

(ii)

Additional performance threshold for exceptional performance

In addition to the performance threshold under clause (i), for each year of the MIPS (beginning with 2019 and ending with 2024), the Secretary shall compute an additional performance threshold for purposes of determining the additional MIPS adjustment factors under subparagraph (C). For each such year, subject to clause (iii), the Secretary shall apply either of the following methods for computing such additional performance threshold for such a year:

(I)

The threshold shall be the score that is equal to the 25th percentile of the range of possible composite performance scores above the performance threshold determined under clause (i).

(II)

The threshold shall be the score that is equal to the 25th percentile of the actual composite performance scores for MIPS eligible professionals with composite performance scores at or above the performance threshold with respect to the prior period described in clause (i).

(iii)

Special rule for initial 5 years

With respect to each of the first five years to which the MIPS applies, the Secretary shall, prior to the performance period for such years, establish a performance threshold for purposes of determining MIPS adjustment factors under subparagraph (A) and a threshold for purposes of determining additional MIPS adjustment factors under subparagraph (C). Each such performance threshold shall—

(I)

be based on a period prior to such performance periods; and

(II)

take into account—

(aa)

data available with respect to performance on measures and activities that may be used under the performance categories under subparagraph (2)(B); and

(bb)

other factors determined appropriate by the Secretary.

(iv)

Additional special rule for third, fourth and fifth years of MIPS

(E)

Application of MIPS adjustment factors

In the case of covered professional services (as defined in subsection (k)(3)(A)) furnished by a MIPS eligible professional during a year (beginning with 2019), the amount otherwise paid under this part with respect to such covered professional services and MIPS eligible professional for such year, shall be multiplied by—

(i)

1, plus

(ii)

the sum of—

(I)

the MIPS adjustment factor determined under subparagraph (A) divided by 100, and

(II)

as applicable, the additional MIPS adjustment factor determined under subparagraph (C) divided by 100.

(F)

Aggregate application of MIPS adjustment factors

(i)

Application of scaling factor

(I)

In general

(II)

Scaling factor limit

(ii)

Budget neutrality requirement

(I)

In general

(II)

Aggregate increases

(III)

Aggregate decreases

(iii)

Exceptions

(I)

In the case that all MIPS eligible professionals receive composite performance scores for a year that are below the performance threshold under subparagraph (D)(i) for such year, the negative MIPS adjustment factors under subparagraph (A) shall apply with respect to such MIPS eligible professionals and the budget neutrality requirement of clause (ii) and the additional adjustment factors under clause (iv) shall not apply for such year.

(II)

In the case that, with respect to a year, the application of clause (i) results in a scaling factor equal to the maximum scaling factor specified in clause (i)(II), such scaling factor shall apply and the budget neutrality requirement of clause (ii) shall not apply for such year.

(iv)

Additional incentive payment adjustments

(I)

In general

(II)

Limitation on additional incentive payment adjustments

(7)

Announcement of result of adjustments

(8)

No effect in subsequent years

(9)

Public reporting

(A)

In general

The Secretary shall, in an easily understandable format, make available on the Physician Compare Internet website of the Centers for Medicare & Medicaid Services the following:

(i)

Information regarding the performance of MIPS eligible professionals under the MIPS, which—

(I)

shall include the composite score for each such MIPS eligible professional and the performance of each such MIPS eligible professional with respect to each performance category; and

(II)

may include the performance of each such MIPS eligible professional with respect to each measure or activity specified in paragraph (2)(B).

(ii)

The names of eligible professionals in eligible alternative payment models 11

 So in original. Section 1395l(z)(3)(D) of this title defines the term “eligible alternative payment entity”.

(as defined in section 1395l(z)(3)(D) of this title) and, to the extent feasible, the names of such eligible alternative payment models and performance of such models.

(B)

Disclosure

(C)

Opportunity to review and submit corrections

(D)

Aggregate information

(10)

Consultation

(11)

Technical assistance to small practices and practices in health professional shortage areas

(A)

In general

The Secretary shall enter into contracts or agreements with appropriate entities (such as quality improvement organizations, regional extension centers (as described in section 300jj–32(c) of this title), or regional health collaboratives) to offer guidance and assistance to MIPS eligible professionals in practices of 15 or fewer professionals (with priority given to such practices located in rural areas, health professional shortage areas (as designated under in ⁷ section 254e(a)(1)(A) of this title), and medically underserved areas, and practices with low composite scores) with respect to—

(i)

the performance categories described in clauses (i) through (iv) of paragraph (2)(A); or

(ii)

how to transition to the implementation of and participation in an alternative payment model as described in section 1395l(z)(3)(C) of this title.

(B)

Funding for technical assistance

(12)

Feedback and information to improve performance

(A)

Performance feedback

(i)

In general

Beginning July 1, 2017, the Secretary—

(I)

shall make available timely (such as quarterly) confidential feedback to MIPS eligible professionals on the performance of such professionals with respect to the performance categories under clauses (i) and (ii) of paragraph (2)(A); and

(II)

may make available confidential feedback to such professionals on the performance of such professionals with respect to the performance categories under clauses (iii) and (iv) of such paragraph.

(ii)

Mechanisms

(iii)

Use of data

(iv)

Disclosure exemption

(v)

Receipt of information

(B)

Additional information

(i)

In general

(ii)

Type of information

For purposes of clause (i), the information described in this clause,⁵ is the following:

(I)

With respect to selected items and services (as determined appropriate by the Secretary) for which payment is made under this subchapter and that are furnished to individuals, who are patients of a MIPS eligible professional, by another supplier or provider of services during the most recent period for which data are available (such as the most recent three-month period), such as the name of such providers furnishing such items and services to such patients during such period, the types of such items and services so furnished, and the dates such items and services were so furnished.

(II)

Historical data, such as averages and other measures of the distribution if appropriate, of the total, and components of, allowed charges (and other figures as determined appropriate by the Secretary).

(13)

Review

(A)

Targeted review

(B)

Limitation

Except as provided for in subparagraph (A), there shall be no administrative or judicial review under section 1395ff of this title, section 1395oo of this title, or otherwise of the following:

(i)

The methodology used to determine the amount of the MIPS adjustment factor under paragraph (6)(A) and the amount of the additional MIPS adjustment factor under paragraph (6)(C) and the determination of such amounts.

(ii)

The establishment of the performance standards under paragraph (3) and the performance period under paragraph (4).

(iii)

The identification of measures and activities specified under paragraph (2)(B) and information made public or posted on the Physician Compare Internet website of the Centers for Medicare & Medicaid Services under paragraph (9).

(iv)

The methodology developed under paragraph (5) that is used to calculate performance scores and the calculation of such scores, including the weighting of measures and activities under such methodology.

(r)

Collaborating with the physician, practitioner, and other stakeholder communities to improve resource use measurement

(1)

In general

(2)

Development of care episode and patient condition groups and classification codes

(A)

In general

(B)

Public availability of existing efforts to design an episode grouper

(C)

Stakeholder input

The Secretary shall accept, through the date that is 120 days after the day the Secretary posts the list pursuant to subparagraph (B), suggestions from physician specialty societies, applicable practitioner organizations, and other stakeholders for episode groups in addition to those posted pursuant to such subparagraph, and specific clinical criteria and patient characteristics to classify patients into—

(i)

care episode groups; and

(ii)

patient condition groups.

(D)

Development of proposed classification codes

(i)

In general

Taking into account the information described in subparagraph (B) and the information received under subparagraph (C), the Secretary shall—

(I)

establish care episode groups and patient condition groups, which account for a target of an estimated ½ of expenditures under parts A and B (with such target increasing over time as appropriate); and

(II)

assign codes to such groups.

(ii)

Care episode groups

In establishing the care episode groups under clause (i), the Secretary shall take into account—

(I)

the patient’s clinical problems at the time items and services are furnished during an episode of care, such as the clinical conditions or diagnoses, whether or not inpatient hospitalization occurs, and the principal procedures or services furnished; and

(II)

other factors determined appropriate by the Secretary.

(iii)

Patient condition groups

In establishing the patient condition groups under clause (i), the Secretary shall take into account—

(I)

the patient’s clinical history at the time of a medical visit, such as the patient’s combination of chronic conditions, current health status, and recent significant history (such as hospitalization and major surgery during a previous period, such as 3 months); and

(II)

other factors determined appropriate by the Secretary, such as eligibility status under this subchapter (including eligibility under section 426(a) of this title, section 426(b) of this title, or section 426–1 of this title, and dual eligibility under this subchapter and subchapter XIX).

(E)

Draft care episode and patient condition groups and classification codes

(F)

Solicitation of input

(G)

Operational list of care episode and patient condition groups and codes

(H)

Subsequent revisions

(I)

Information

(3)

Attribution of patients to physicians or practitioners

(A)

In general

(B)

Development of patient relationship categories and codes

The Secretary shall develop patient relationship categories and codes that define and distinguish the relationship and responsibility of a physician or applicable practitioner with a patient at the time of furnishing an item or service. Such patient relationship categories shall include different relationships of the physician or applicable practitioner to the patient (and the codes may reflect combinations of such categories), such as a physician or applicable practitioner who—

(i)

considers themself to have the primary responsibility for the general and ongoing care for the patient over extended periods of time;

(ii)

considers themself to be the lead physician or practitioner and who furnishes items and services and coordinates care furnished by other physicians or practitioners for the patient during an acute episode;

(iii)

furnishes items and services to the patient on a continuing basis during an acute episode of care, but in a supportive rather than a lead role;

(iv)

furnishes items and services to the patient on an occasional basis, usually at the request of another physician or practitioner; or

(v)

furnishes items and services only as ordered by another physician or practitioner.

(C)

Draft list of patient relationship categories and codes

(D)

Stakeholder input

(E)

Operational list of patient relationship categories and codes

(F)

Subsequent revisions

(4)

Reporting of information for resource use measurement

Claims submitted for items and services furnished by a physician or applicable practitioner on or after January 1, 2018, shall, as determined appropriate by the Secretary, include—

(A)

applicable codes established under paragraphs (2) and (3); and

(B)

the national provider identifier of the ordering physician or applicable practitioner (if different from the billing physician or applicable practitioner).

(5)

Methodology for resource use analysis

(A)

In general

In order to evaluate the resources used to treat patients (with respect to care episode and patient condition groups), the Secretary shall, as the Secretary determines appropriate—

(i)

use the patient relationship codes reported on claims pursuant to paragraph (4) to attribute patients (in whole or in part) to one or more physicians and applicable practitioners;

(ii)

use the care episode and patient condition codes reported on claims pursuant to paragraph (4) as a basis to compare similar patients and care episodes and patient condition groups; and

(iii)

conduct an analysis of resource use (with respect to care episodes and patient condition groups of such patients).

(B)

Analysis of patients of physicians and practitioners

In conducting the analysis described in subparagraph (A)(iii) with respect to patients attributed to physicians and applicable practitioners, the Secretary shall, as feasible—

(i)

use the claims data experience of such patients by patient condition codes during a common period, such as 12 months; and

(ii)

use the claims data experience of such patients by care episode codes—

(I)

in the case of episodes without a hospitalization, during periods of time (such as the number of days) determined appropriate by the Secretary; and

(II)

in the case of episodes with a hospitalization, during periods of time (such as the number of days) before, during, and after the hospitalization.

(C)

Measurement of resource use

In measuring such resource use, the Secretary—

(i)

shall use per patient total allowed charges for all services under part A and this part (and, if the Secretary determines appropriate, part D) for the analysis of patient resource use, by care episode codes and by patient condition codes; and

(ii)

may, as determined appropriate, use other measures of allowed charges (such as subtotals for categories of items and services) and measures of utilization of items and services (such as frequency of specific items and services and the ratio of specific items and services among attributed patients or episodes).

(D)

Stakeholder input

(6)

Implementation

(7)

Limitation

There shall be no administrative or judicial review under section 1395ff of this title, section 1395oo of this title, or otherwise of—

(A)

care episode and patient condition groups and codes established under paragraph (2);

(B)

patient relationship categories and codes established under paragraph (3); and

(C)

measurement of, and analyses of resource use with respect to, care episode and patient condition codes and patient relationship codes pursuant to paragraph (5).

(8)

Administration

(9)

Definitions

In this subsection:

(A)

Physician

(B)

Applicable practitioner

The term “applicable practitioner” means—

(i)

a physician assistant, nurse practitioner, and clinical nurse specialist (as such terms are defined in section 1395x(aa)(5) of this title), and a certified registered nurse anesthetist (as defined in section 1395x(bb)(2) of this title); and

(ii)

beginning January 1, 2019, such other eligible professionals (as defined in subsection (k)(3)(B)) as specified by the Secretary.

(10)

Clarification

(s)

Priorities and funding for measure development

(1)

Plan identifying measure development priorities and timelines

(A)

Draft measure development plan

Not later than January 1, 2016, the Secretary shall develop, and post on the Internet website of the Centers for Medicare & Medicaid Services, a draft plan for the development of quality measures for application under the applicable provisions (as defined in paragraph (5)). Under such plan the Secretary shall—

(i)

address how measures used by private payers and integrated delivery systems could be incorporated under subchapter XVIII;

(ii)

describe how coordination, to the extent possible, will occur across organizations developing such measures; and

(iii)

take into account how clinical best practices and clinical practice guidelines should be used in the development of quality measures.

(B)

Quality domains

For purposes of this subsection, the term “quality domains” means at least the following domains:

(i)

Clinical care.

(ii)

Safety.

(iii)

Care coordination.

(iv)

Patient and caregiver experience.

(v)

Population health and prevention.

(C)

Consideration

In developing the draft plan under this paragraph, the Secretary shall consider—

(i)

gap analyses conducted by the entity with a contract under section 1395aaa(a) of this title or other contractors or entities;

(ii)

whether measures are applicable across health care settings;

(iii)

clinical practice improvement activities submitted under subsection (q)(2)(C)(iv) for identifying possible areas for future measure development and identifying existing gaps with respect to such measures; and

(iv)

the quality domains applied under this subsection.

(D)

Priorities

In developing the draft plan under this paragraph, the Secretary shall give priority to the following types of measures:

(i)

Outcome measures, including patient reported outcome and functional status measures.

(ii)

Patient experience measures.

(iii)

Care coordination measures.

(iv)

Measures of appropriate use of services, including measures of over use.

(E)

Stakeholder input

(F)

Final measure development plan

(2)

Contracts and other arrangements for quality measure development

(A)

In general

(B)

Prioritization

(i)

In general

(ii)

Consideration

In selecting measures for development under this subsection, the Secretary shall consider—

(I)

whether such measures would be electronically specified; and

(II)

clinical practice guidelines to the extent that such guidelines exist.

(3)

Annual report by the Secretary

(A)

In general

(B)

Requirements

Each report submitted pursuant to subparagraph (A) shall include the following:

(i)

A description of the Secretary’s efforts to implement this paragraph.

(ii)

With respect to the measures developed during the previous year—

(I)

a description of the total number of quality measures developed and the types of such measures, such as an outcome or patient experience measure;

(II)

the name of each measure developed;

(III)

the name of the developer and steward of each measure;

(IV)

with respect to each type of measure, an estimate of the total amount expended under this subchapter to develop all measures of such type; and

(V)

whether the measure would be electronically specified.

(iii)

With respect to measures in development at the time of the report—

(I)

the information described in clause (ii), if available; and

(II)

a timeline for completion of the development of such measures.

(iv)

A description of any updates to the plan under paragraph (1) (including newly identified gaps and the status of previously identified gaps) and the inventory of measures applicable under the applicable provisions.

(v)

Other information the Secretary determines to be appropriate.

(4)

Stakeholder input

With respect to paragraph (1), the Secretary shall seek stakeholder input with respect to—

(A)

the identification of gaps where no quality measures exist, particularly with respect to the types of measures described in paragraph (1)(D);

(B)

prioritizing quality measure development to address such gaps; and

(C)

other areas related to quality measure development determined appropriate by the Secretary.

(5)

Definition of applicable provisions

In this subsection, the term “applicable provisions” means the following provisions:

(A)

Subsection (q)(2)(B)(i).

(B)

section 13

 So in original. Probably should be “Section”.

1395l(z)(3)(D) of this title.

(6)

Funding

(7)

Administration

(t)

Supporting physicians and other professionals in adjusting to Medicare payment changes during 2021 through 2024

(1)

In general

In order to support physicians and other professionals in adjusting to changes in payment for physicians’ services during 2021, 2022, 2023, and 2024, the Secretary shall increase fee schedules under subsection (b) that establish payment amounts for—

(A)

such services furnished on or after January 1, 2021, and before January 1, 2022, by 3.75 percent;

(B)

such services furnished on or after January 1, 2022, and before January 1, 2023, by 3.0 percent;

(C)

such services furnished on or after January 1, 2023, and before January 1, 2024, by 2.5 percent;

(D)

such services furnished on or after January, 1, 2024, and before March 9, 2024, by 1.25 percent; and

(E)

such services furnished on or after March 9, 2024, and before January 1, 2025, by 2.93 percent.

(2)

Implementation

(A)

Administration

(B)

Limitation

(C)

Application only for 2021 through 2024

(3)

Funding

For purposes of increasing the fee schedules that establish payment amounts pursuant to this subsection—

(A)

there shall be transferred from the General Fund of the Treasury to the Federal Supplementary Medical Insurance Trust Fund under section 1395t of this title, $3,000,000,000, to remain available until expended; and

(B)

in the event the Secretary determines additional amounts are necessary, such amounts shall be available from the Federal Supplementary Medical Insurance Trust Fund.

(Aug. 14, 1935, ch. 531, title XVIII, § 1848, as added Pub. L. 101–239, title VI, § 6102(a), Dec. 19, 1989, 103 Stat. 2169; amended Pub. L. 101–508, title IV, §§ 4102(b), (g)(2), 4104(b)(2), 4105(a)(3), (c), 4106(b)(1), 4107(a)(1), 4109(a), 4116, 4118(b)–(f)(1), (k), Nov. 5, 1990, 104 Stat. 1388–56, 1388–57, 1388–59 to 1388–63, 1388–65, 1388–67, 1388–68, 1388–71; Pub. L. 103–66, title XIII, §§ 13511(a), 13512–13514(c), 13515(a)(1), (c), 13516(a)(1), 13517(a), 13518(a), Aug. 10, 1993, 107 Stat. 580–583, 585, 586; Pub. L. 103–432, title I, §§ 121(b)(1), (2), 122(a), (b), 123(a), (d), 126(b)(6), (g)(2)(B), (5)–(7), (10)(A), Oct. 31, 1994, 108 Stat. 4409, 4410, 4412, 4415, 4416; Pub. L. 105–33, title IV, §§ 4022(b)(2)(B), (C), 4102(d), 4103(d), 4104(d), 4105(a)(2), 4106(b), 4501, 4502(a)(1), (b), 4503, 4504(a), 4505(a), (b), (e), (f)(1), 4644(d), 4714(b)(2), Aug. 5, 1997, 111 Stat. 354, 355, 361, 362, 365, 366, 368, 432–437, 488, 510; Pub. L. 106–113, div. B, § 1000(a)(6) [title II, § 211(a)(1), (2)(A), (3)(A), (b), title III, § 321(k)(5)], Nov. 29, 1999, 113 Stat. 1536, 1501A–345 to 1501A–348, 1501A–366; Pub. L. 106–554, § 1(a)(6) [title I, § 104(a)], Dec. 21, 2000, 114 Stat. 2763, 2763A–469; Pub. L. 108–7, div. N, title IV, § 402(a), Feb. 20, 2003, 117 Stat. 548; Pub. L. 108–173, title III, § 303(a)(1), (g)(2), title IV, § 412, title VI, §§ 601(a)(1), (2), (b)(1), 602, 611(c), title VII, § 736(b)(10), Dec. 8, 2003, 117 Stat. 2233, 2253, 2274, 2300, 2301, 2304, 2356;

cite as: 42 USC 1395w-4

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