Advanced Revenue Cycle Analytics: An Overview
We already know that the work for revenue cycle teams will increase in 2019. After the CMS published the Medicare Physician Fee Schedule (MPFS), we also know that reimbursement rates will remain flat across the board. These trends together will make it difficult for practices to increase their revenue this year.
There are several factors that make it difficult to predict the reimbursement rate for an individual practice. These factors include:
- Patient volume
- Mix of payers
- Volume of procedures
However, you can get a general idea of what your reimbursements will be by looking at the Medicare Physician Fee Schedule conversion factor. The Medicare Physician Fee Schedule (MPFS) final rule was published on November 1, 2018. Below are the 4 things that every physician practice needs to know about the MPFS for 2019.
The 2019 Medicare conversion rate only increased by 0.14%
In 2018, the MPFS conversion factor was $35.9996. This year, the conversion factor is $36.0391. That is an increase of 0.14%. Most payers base their fee schedule off of the MPFS, so it would appear that reimbursement rates will be flat this year. However, this does not account for inflation. After inflation, the fee schedule change is actually a negative 2.06%. As a result, practices will need to get creative in order to increase revenue this year.
The maximum positive adjustment under MIPS was 0.3%
Medicare chose to focus any additional dollars on the transition to value based payments. For most, this means the Merit-based Incentive Payment System. The problem with MIPS is that it promises reward, but it does not deliver. The maximum bonus paid to groups who did not achieve “exceptional performance” was a mere 0.3%. This is another area where reimbursement remains flat.
The proposed changes to E/M reimbursement are delayed until 2021
Earlier this year, CMS proposed changes to E/M reimbursements in order to reduce the amount of administrative work that physicians have to do. The proposed change will reduce the documentation requirements for differentiating between different levels of service for new and established outpatient visits. It will also simplify the reimbursement for different levels of service.
While the effort to reduce documentation for physicians in order to decrease physician burnout is a great thing, the changes to reimbursements may not actually be helpful. The changes to the reimbursement levels of service are as follows:
- Level 1 – Modest increase
- Levels 2 & 3 – Significant increase
- Levels 4 & 5 – Significant decrease
If you were to evenly distribute the E/M level codes, the result would actually be a 0.46% decrease in reimbursement for established patient visits. Because of these results, the changes have been delayed until 2021.
There you have it. The MPFS for 2019 will result in flat reimbursement rates, and practices will need to work smarter in order to increase their revenue. Prepare yourself for this and other trends in 2019 that will affect your revenue cycle by watching our free on-demand webinar. Click here to view now.