[Federal Register: July 13, 2009 (Volume 74, Number 132)]
[Proposed Rules]               
[Page 33519-33825]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr13jy09-23]                         
 

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Part II





Department of Health and Human Services





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Centers for Medicare & Medicaid Services



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42 CFR Parts 410, 411, 414, et al.



Medicare Program; Payment Policies Under the Physician Fee Schedule and 
Other Revisions to Part B for CY 2010; Proposed Rule


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Centers for Medicare & Medicaid Services

42 CFR Parts 410, 411, 414, 415, and 485

[CMS-1413-P]
RIN 0938-AP40

 
Medicare Program; Payment Policies Under the Physician Fee 
Schedule and Other Revisions to Part B for CY 2010

AGENCY: Centers for Medicare & Medicaid Services (CMS), HHS.

ACTION: Proposed rule.

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SUMMARY: This proposed rule would address proposed changes to Medicare 
Part B payment policy. We are proposing these changes to ensure that 
our payment systems are updated to reflect changes in medical practice 
and the relative value of services. This proposed rule discusses: 
Refinements to resource-based work, practice expense and malpractice 
relative value units (RVUs); geographic practice cost indices (GPCIs); 
telehealth services; several coding issues; physician fee schedule 
update for CY 2010; payment for covered part B outpatient drugs and 
biologicals; the competitive acquisition program (CAP); payment for 
renal dialysis services; the chiropractic services demonstration; 
comprehensive outpatient rehabilitation facilities; physician self-
referral; the ambulance fee schedule; the clinical laboratory fee 
schedule; durable medical equipment, prosthetics, orthotics, and 
supplies (DMEPOS); and certain provisions of the Medicare Improvements 
for Patients and Providers Act of 2008. (See the Table of contents for 
a listing of the specific issues.)

DATES: To be assured consideration, comments must be received at one of 
the addresses provided below, no later than 5 p.m. on Monday, August 
31, 2009.

ADDRESSES: In commenting, please refer to file code CMS-1413-P. Because 
of staff and resource limitations, we cannot accept comments by 
facsimile (FAX) transmission.
    You may submit comments in one of four ways (please choose only one 
of the ways listed):
    1. Electronically. You may submit electronic comments on this 
regulation to http://www.regulations.gov. Follow the instructions under 
the ``More Search Options'' tab.
    2. By regular mail. You may mail written comments to the following 
address ONLY: Centers for Medicare & Medicaid Services, Department of 
Health and Human Services, Attention: CMS-1413-P, P.O. Box 8013, 
Baltimore, MD 21244-8013.

    Please allow sufficient time for mailed comments to be received 
before the close of the comment period.
    3. By express or overnight mail. You may send written comments to 
the following address only: Centers for Medicare & Medicaid Services, 
Department of Health and Human Services, Attention: CMS-1413-P, Mail 
Stop C4-26-05, 7500 Security Boulevard, Baltimore, MD 21244-1850.

    4. By hand or courier. If you prefer, you may deliver (by hand or 
courier) your written comments before the close of the comment period 
to either of the following addresses:
    a. For delivery in Washington, DC--Centers for Medicare & Medicaid 
Services, Department of Health and Human Services, Room 445-G, Hubert 
H. Humphrey Building, 200 Independence Avenue, SW., Washington, DC 
20201.

    (Because access to the interior of the Hubert H. Humphrey Building 
is not readily available to persons without Federal government 
identification, commenters are encouraged to leave their comments in 
the CMS drop slots located in the main lobby of the building. A stamp-
in clock is available for persons wishing to retain a proof of filing 
by stamping in and retaining an extra copy of the comments being 
filed.)
    b. For delivery in Baltimore, MD--Centers for Medicare & Medicaid 
Services, Department of Health and Human Services, 7500 Security 
Boulevard, Baltimore, MD 21244-1850.

    If you intend to deliver your comments to the Baltimore address, 
please call telephone number (410) 786-9994 in advance to schedule your 
arrival with one of our staff members.
    Comments mailed to the addresses indicated as appropriate for hand 
or courier delivery may be delayed and received after the comment 
period.

FOR FURTHER INFORMATION CONTACT: 
Rick Ensor, (410) 786-5617, for issues related to practice expense 
methodology.
Craig Dobyski, (410) 786-4584, for issues related to geographic 
practice cost indices.
Esther Markowitz, (410) 786-4595, for issues related to telehealth 
services.
Ken Marsalek, (410) 786-4502, for issues related to the physician 
practice information survey and the multiple procedure payment 
reduction.
Cathleen Scally, (410) 786-5714, for issues related to the initial 
preventive physical examination or consultation services.
Regina Walker-Wren, (410) 786-9160, for issues related to the phasing 
out of the outpatient mental health treatment limitation.
Diane Stern, (410) 786-1133, for issues related to the physician 
quality reporting initiative and incentives for e-prescribing.
Lisa Grabert, (410) 786-6827, for issues related to the Physician 
Resource Use Feedback Program.
Colleen Bruce, (410) 786-5529, for issues related to value-based 
purchasing.
Sandra Bastinelli, (410) 786-3630, for issues related to the 
implementation of accreditation standards.
Jim Menas, (410) 786-4507, for issues related to teaching anesthesia 
services.
Sarah McClain, (410) 786-2994, for issues related to the coverage of 
cardiac rehabilitation services.
Dorothy Shannon, (410) 786-3396, for issues related to payment for 
cardiac rehabilitation services.
Roya Lofti, (410) 786-4072, for issues related to the coverage of 
pulmonary rehabilitation.
Jamie Hermansen, (410) 786-2064, for issues related to kidney disease 
patient education programs.
Terri Harris, (410) 786-6830 for issues related to payment for kidney 
disease patient education.
Henry Richter, (410) 786-4562, or Lisa Hubbard, (410) 786-5472, for 
issues related to renal dialysis provisions and payments for end-stage 
renal disease facilities.
Cheryl Gilbreath, (410) 786-5919, for issues related to payment for 
covered outpatient drugs and biologicals.
Edmund Kasaitis, (410) 786-0477, or Bonny Dahm, (410) 786-4006, for 
issues related to the Competitive Acquisition Program (CAP) for Part B 
drugs.
Pauline Lapin, (410) 786-6883, for issues related to the chiropractic 
services demonstration budget neutrality issue.
Monique Howard, (410) 786-3869, for issues related to CORF conditions 
of coverage.
Roechel Kujawa, (410) 786-9111, for issues related to ambulance 
services.
Anne Tayloe Hauswald, (410) 786-4546, for clinical laboratory issues.
Troy Barsky, (410) 786-8873, or Roy Albert, (410) 786-1872, for issues 
related to physician self-referral.
Michelle Peterman, (410) 786-2591, or Iffat Fatima, (410) 786-6709 for 
issues related to the grandfathering

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provisions of the durable medical equipment, prosthetics, orthotics, 
and supplies (DMEPOS) Competitive Acquisition Program.
Ralph Goldberg, (410) 786-4870, or Heidi Edmunds, (410) 786-1781, for 
issues related to the damages process caused by the termination of 
contracts awarded in 2008 under the DMEPOS Competitive Bidding program.
Diane Milstead, (410) 786-3355, or Gaysha Brooks, (410) 786-9649, for 
all other issues.

SUPPLEMENTARY INFORMATION:
    Inspection of Public Comments: All comments received before the 
close of the comment period are available for viewing by the public, 
including any personally identifiable or confidential business 
information that is included in a comment. We post all comments 
received before the close of the comment period on the following Web 
site as soon as possible after they have been received: http://
www.regulations.gov. Follow the search instructions on that Web site to 
view public comments.
    Comments received timely will also be available for public 
inspection as they are received, generally beginning approximately 3 
weeks after publication of a document, at the headquarters of the 
Centers for Medicare & Medicaid Services, 7500 Security Boulevard, 
Baltimore, Maryland 21244, Monday through Friday of each week from 8:30 
a.m. to 4 p.m. To schedule an appointment to view public comments, 
phone 1-800-743-3951.

Table of Contents

    To assist readers in referencing sections contained in this 
preamble, we are providing a table of contents. Some of the issues 
discussed in this preamble affect the payment policies, but do not 
require changes to the regulations in the Code of Federal Regulations 
(CFR). Information on the regulation's impact appears throughout the 
preamble, and therefore, is not exclusively in section V. of this 
proposed rule.

I. Background
    A. Development of the Relative Value System
    1. Work RVUs
    2. Practice Expense Relative Value Units (PE RVUs)
    3. Resource-Based Malpractice RVUs
    4. Refinements to the RVUs
    5. Adjustments to RVUs Are Budget Neutral
    B. Components of the Fee Schedule Payment Amounts
    C. Most Recent Changes to Fee Schedule
II. Provisions of the Proposed Regulation
    A. Resource-Based Practice Expense (PE) Relative Value Units 
(RVUs)
    1. Current Methodology
    a. Data Sources for Calculating Practice Expense
    b. Allocation of PE to Services
    c. Facility and Nonfacility Costs
    d. Services With Technical Components (TCs) and Professional 
Components (PCs)
    e. Transition Period
    f. PE RVU Methodology
    2. PE Proposals for CY 2010
    a. SMS and Supplemental Survey Background
    b. Physician Practice Information Survey (PPIS)
    c. Equipment Utilization Rate
    d. Miscellaneous PE Issues
    e. AMA RUC PE Recommendations for Direct PE Inputs
    B. Geographic Practice Cost Indices (GPCIs): Locality Discussion
    1. Update--Expiration of 1.0 Work GPCI Floor
    2. Payment Localities
    C. Malpractice RVUs
    1. Background
    2. Proposed Methodology for the Revision of Resource-Based 
Malpractice RVUs
    D. Medicare Telehealth Services
    1. Requests for Adding Services to the List of Medicare 
Telehealth Services
    2. Submitted Requests for Addition to the List of Telehealth 
Services
    E. Specific Coding Issues Related to Physician Fee Schedule
    1. Canalith Repositioning
    2. Payment for an Initial Preventive Physical Examination (IPPE)
    3. Audiology Codes: Policy Clarification of Existing CPT Codes
    4. Consultation Services
    F. Potentially Misvalued Codes Under the Physician Fee Schedule
    1. Valuing Services Under the Physician Fee Schedule
    2. High Cost Supplies
    3. Review of Services Often Billed Together and the Possibility 
of Expanding the Multiple Procedure Payment Reduction (MPPR) to 
Additional Nonsurgical Services
    4. AMA RUC Review of Potentially Misvalued Services
    a. Site of Service Anomalies
    b. ``23-Hour'' Stay
    5. Establishing Appropriate Relative Values for Physician Fee 
Schedule Services
    G. Issues Related to the Medicare Improvements for Patients and 
Providers Act of 2008 (MIPPA)
    1. Section 102: Elimination of Discriminatory Copayment Rates 
for Medicare Outpatient Psychiatric Services
    2. Section 131(b): Physician Payment, Efficiency, and Quality 
Improvements--Physician Quality Reporting Initiative (PQRI)
    3. Section 131(c): Physician Resource Use Measurement and 
Reporting Program
    4. Section 131(d): Plan for Transition to Value-Based Purchasing 
Program for Physicians and Other Practitioners
    5. Section 132: Incentives for Electronic Prescribing (E-
Prescribing)--The E-Prescibing Incentive Program
    6. Section 135: Implementation of Accreditation Standards for 
Suppliers Furnishing the Technical Component (TC) of Advanced 
Diagnostic Imaging Services
    7. Section 139: Improvements for Medicare Anesthesia Teaching 
Programs
    8. Section 144(a): Payment and Coverage Improvements for 
Patients With Chronic Obstructive Pulmonary Disease and Other 
Conditions--Cardiac Rehabilitation Services
    9. Section 144(a): Payment and Coverage Improvements for 
Patients With Chronic Obstructive Pulmonary Disease and Other 
Conditions--Pulmonary Rehabitation Services
    10. Section 152(b): Coverage of Kidney Disease Patient Education 
Services
    11. Section 153: Renal Dialysis Provisions
    12. Section 182(b): Revision of Definition of Medically-Accepted 
Indication for Drugs; Compendia for Determination of Medically-
Accepted Indications for Off-Label Uses of Drugs and Biologicals in 
an Anti-Cancer Chemotherapeutic Regimen
    H. Part B Drug Payment
    1. Average Sales Price (ASP) Issues
    2. Competitive Acquisition Program (CAP) Issues
    I. Provisions Related to Payment for Renal Dialysis Services 
Furnished by End-Stage Renal Disease (ESRD) Facilities
    J. Discussion of Chiropractic Services Demonstration
    1. Background
    2. Analysis of Demonstration
    3. Payment Adjustment
    K. Comprehensive Outpatient Rehabilitation Facilities (CORF) and 
Rehabilitation Agency Issues
    L. Ambulance Fee Schedule: Technical Correction to the Rural 
Adjustment Factor Regulations (414.610)
    M. Clinical Laboratory Fee Schedule: Signature on Requisition
    N. Physician Self-Referral
    1. General Background
    2. Physician Stand in the Shoes
    O. Durable Medical Equipment-Related Issues
    1. Damages to Suppliers Awarded a Contract Under the Acquisition 
of Certain Durable Medical Equipment, Prosthetics, Orthotics, and 
Supplies (Medicare DMEPOS Competitive Bidding Program) Caused by the 
Delay of the Program
    2. Notification to Beneficiaries for Suppliers Regarding 
Grandfathering
    P. Physician Fee Schedule Update for CY 2010
III. Collection of Information Requirements
IV. Response to Comments
V. Regulatory Impact Analysis
Regulation Text
Addendum A--Explanation and Use of Addendum B
Addendum B--Proposed Relative Value Units and Related Information 
Used in Determining Medicare Payments for CY 2010
Addendum C--[Reserved]
Addendum D--Proposed 2010 Geographic Adjustment Factors (GAFs)
Addendum E--Proposed 2010 Geographic Practice Cost Indices (GPCIs) 
by State and Medicare Locality

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Addendum F--Proposed CY 2010 ESRD Wage Index for Urban Areas Based 
on CBSA Labor Market Areas
Addendum G--Propsoed CY 2010 ESRD Wage Index Based on CBSA Labor 
Market Areas for Rural Areas

Acronyms

    In addition, because of the many organizations and terms to which 
we refer by acronym in this final rule with comment period, we are 
listing these acronyms and their corresponding terms in alphabetical 
order below:

AACVPR American Association of Cardiovascular and Pulmonary 
Rehabilitation
ACC American College of Cardiology
ACGME Accreditation Council on Graduate Medical Education
ACR American College of Radiology
AFROC Association of Freestanding Radiation Oncology Centers
AHA American Heart Association
AHRQ [HHS'] Agency for Healthcare Research and Quality
AIDS Acquired immune deficiency syndrome
AMA American Medical Association
AMP Average manufacturer price
AOA American Osteopathic Association
APA American Psychological Association
APTA American Physical Therapy Association
ASC Ambulatory surgical center
ASP Average sales price
ASRT American Society of Radiologic Technologists
ASTRO American Society for Therapeutic Radiology and Oncology
ATA American Telemedicine Association
AWP Average wholesale price
BBA Balanced Budget Act of 1997 (Pub. L. 105-33)
BBRA [Medicare, Medicaid and State Child Health Insurance Program] 
Balanced Budget Refinement Act of 1999 (Pub. L. 106-113)
BIPA Medicare, Medicaid, and SCHIP Benefits Improvement Protection 
Act of 2000 (Pub. L. 106-554)
BLS Bureau of Labor Statistics
BN Budget neutrality
CABG Coronary artery bypass graft
CAD Coronary artery disease
CAH Critical access hospital
CAHEA Committee on Allied Health Education and Accreditation
CAP Competitive acquisition program
CBSA Core-Based Statistical Area
CCHIT Certification Commission for Healthcare Information Technology
CEAMA Council on Education of the American Medical Association
CF Conversion factor
CfC Conditions for Coverage
CFR Code of Federal Regulations
CKD Chronic kidney disease
CLFS Clinical laboratory fee schedule
CMA California Medical Association
CMHC Community mental health center
CMP Civil money penalty
CMS Centers for Medicare & Medicaid Services
CNS Clinical nurse specialist
CoP Condition of participation
COPD Chronic obstructive pulmonary disease
CORF Comprehensive Outpatient Rehabilitation Facility
COS Cost of service
CPEP Clinical Practice Expert Panel
CPI Consumer Price Index
CPI-U Consumer price index for urban customers
CPT [Physicians'] Current Procedural Terminology (4th Edition, 2002, 
copyrighted by the American Medical Association)
CR Cardiac rehabilitation
CRNA Certified registered nurse anesthetist
CRP Canalith repositioning
CRT Certified respiratory therapist
CSW Clinical social worker
CY Calendar year
DHS Designated health services
DME Durable medical equipment
DMEPOS Durable medical equipment, prosthetics, orthotics, and 
supplies
DOQ Doctor's Office Quality
DRA Deficit Reduction Act of 2005 (Pub. L. 109-171)
DSMT Diabetes self-management training
E/M Evaluation and management
EDI Electronic data interchange
EEG Electroencephalogram
EHR Electronic health record
EKG Electrocardiogram
EMG Electromyogram
EMTALA Emergency Medical Treatment and Active Labor Act
EOG Electro-oculogram
EPO Erythropoietin
ESRD End-stage renal disease
FAX Facsimile
FDA Food and Drug Administration (HHS)
FEV Forced expiratory volume
FFS Fee-for-service
FR Federal Register
FVC Forced expiratory vital capacity (liters)
GAF Geographic adjustment factor
GAO General Accountability Office
GEM Generating Medicare [Physician Quality Performance Measurement 
Results]
GFR Glomerular filtration rate
GPO Group purchasing organization
GPCI Geographic practice cost index
HAC Hospital-acquired conditions
HBAI Health and behavior assessment and intervention
HCPAC Health Care Professional Advisory Committee
HCPCS Healthcare Common Procedure Coding System
HCRIS Healthcare Cost Report Information System
HDRT High dose radiation therapy
HH PPS Home Health Prospective Payment System
HHA Home health agency
HHRG Home health resource group
HHS [Department of] Health and Human Services
HIPAA Health Insurance Portability and Accountability Act of 1996 
(Pub. L. 104-191)
HIT Health information technology
HITECH Health Information Technology for Economic and Clinical 
Health Act (Title IV of Division B of the Recovery Act, together 
with Title XIII of Division A of the Recovery Act)
HITSP Healthcare Information Technology Standards Panel
HIV Human immunodeficiency virus
HOPD Hospital outpatient department
HPSA Health Professional Shortage Area
HRSA Health Resources Services Administration (HHS)
ICD International Classification of Diseases
IACS Individuals Access to CMS Systems
ICF Intermediate care facilities
ICR Intensive cardiac rehabilitation
ICR Information collection requirement
IDTF Independent diagnostic testing facility
IFC Interim final rule with comment period
IMRT Intensity-Modulated Radiation Therapy
IPPE Initial preventive physical examination
IPPS Inpatient prospective payment system
IRS Internal Revenue Service
ISO Insurance services office
IVD Ischemic Vascular Disease
IVIG Intravenous immune globulin
IWPUT Intra-service work per unit of time
JRCERT Joint Review Committee on Education in Radiologic Technology
JUA Joint underwriting association
KDE Kidney disease education
MA Medicare Advantage
MA-PD Medicare Advantage-Prescription Drug Plans
MCMP Medicare Care Management Performance
MedCAC Medicare Evidence Development and Coverage Advisory Committee 
(formerly the Medicare Coverage Advisory Committee (MCAC))
MedPAC Medicare Payment Advisory Commission
MEI Medicare Economic Index
MIEA-TRHCA Medicare Improvements and Extension Act of 2006 (that is, 
Division B of the Tax Relief and Health Care Act of 2006 (TRHCA) 
(Pub. L. 109-432)
MIPPA Medicare Improvements for Patients and Providers Act of 2008 
(Pub. L. 110-275)
MMA Medicare Prescription Drug, Improvement, and Modernization Act 
of 2003 (Pub. L. 108-173)
MMSEA Medicare, Medicaid, and SCHIP Extension Act of 2007 (Pub. L. 
110-173)
MNT Medical nutrition therapy
MP Malpractice
MPPR Multiple procedure payment reduction
MQSA Mammography Quality Standards Act of 1992 (Pub. L. 102-539)
MRA Magnetic resonance angiography
MRI Magnetic resonance imaging
MS-DRG Medicare Severity-Diagnosis related group
MSA Metropolitan statistical area
NCD National Coverage Determination
NCH National Claims History
NCPDP National Council for Prescription Drug Programs
NCQDIS National Coalition of Quality Diagnostic Imaging Services
NDC National drug code
NF Nursing facility
NISTA National Institute of Standards and Technology Act
NP Nurse practitioner
NPDB National Practitioner Data Bank
NPI National Provider Identifier

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NPP Nonphysician practitioner
NPPES National Plan and Provider Enumeration System
NQF National Quality Forum
NRC Nuclear Regulatory Commission
NTTAA National Technology Transfer and Advancement Act of 1995 (Pub. 
L. 104-113)
NUBC National Uniform Billing Committee
OACT [CMS'] Office of the Actuary
OBRA Omnibus Budget Reconciliation Act
ODF Open door forum
OIG Office of Inspector General
OMB Office of Management and Budget
ONC [HHS'] Office of the National Coordinator
OPPS Outpatient prospective payment system
OSA Obstructive Sleep Apnea
OSCAR Online Survey and Certification and Reporting
P4P Pay for performance
PA Physician assistant
PBM Pharmacy benefit manager
PC Professional component
PCF Patient compensation fund
PCI Percutaneous coronary intervention
PDE Prescription drug event
PDP Prescription drug plan
PE Practice expense
PE/HR Practice expense per hour
PEAC Practice Expense Advisory Committee
PECOS Provider Enrollment, Chain, and Ownership System
PERC Practice Expense Review Committee
PFS Physician Fee Schedule
PGP [Medicare] Physician Group Practice
PHP Partial hospitalization program
PIM [Medicare] Program Integrity Manual
PLI Professional liability insurance
POA Present on admission
POC Plan of care
PPI Producer price index
PPIS Physician Practice Information Survey
PPS Prospective payment system
PPTA Plasma Protein Therapeutics Association
PQRI Physician Quality Reporting Initiative
PRA Paperwork Reduction Act
PSA Physician scarcity areas
PSG Polysomnography
PT Physical therapy
PTCA Percutaneous transluminal coronary angioplasty
RA Radiology assistant
Recovery Act American Recovery and Reinvestment Act (Pub. L. 111-5)
ResDAC Research Data Assistance Center
RFA Regulatory Flexibility Act
RIA Regulatory impact analysis
RN Registered nurse
RNAC Reasonable net acquisition cost
RPA Radiology practitioner assistant
RRT Registered respiratory therapist
RUC [AMA's Specialty Society] Relative (Value) Update Committee
RVU Relative value unit
SBA Small Business Administration
SGR Sustainable growth rate
SLP Speech-language pathology
SMS [AMA's] Socioeconomic Monitoring System
SNF Skilled nursing facility
SOR System of record
SRS Stereotactic radiosurgery
TC Technical Component
TIN Tax identification number
TRHCA Tax Relief and Health Care Act of 2006 (Pub. L. 109-432)
TTO Transtracheal oxygen
UPMC University of Pittsburgh Medical Center
USDE United States Department of Education
VBP Value-based purchasing
WAMP Widely available market price

I. Background

    Since January 1, 1992, Medicare has paid for physicians' services 
under section 1848 of the Social Security Act (the Act), ``Payment for 
Physicians' Services.'' The Act requires that payments under the 
physician fee schedule (PFS) be based on national uniform relative 
value units (RVUs) based on the relative resources used in furnishing a 
service. Section 1848(c) of the Act requires that national RVUs be 
established for physician work, practice expense (PE), and malpractice 
expense. Before the establishment of the resource-based relative value 
system, Medicare payment for physicians' services was based on 
reasonable charges.

A. Development of the Relative Value System

1. Work RVUs
    The concepts and methodology underlying the PFS were enacted as 
part of the Omnibus Budget Reconciliation Act (OBRA) of 1989 (Pub. L. 
101-239), and OBRA 1990, (Pub. L. 101-508). The final rule, published 
on November 25, 1991 (56 FR 59502), set forth the fee schedule for 
payment for physicians' services beginning January 1, 1992. Initially, 
only the physician work RVUs were resource-based, and the PE and 
malpractice RVUs were based on average allowable charges.
    The physician work RVUs established for the implementation of the 
fee schedule in January 1992 were developed with extensive input from 
the physician community. A research team at the Harvard School of 
Public Health developed the original physician work RVUs for most codes 
in a cooperative agreement with the Department of Health and Human 
Services (DHHS). In constructing the code-specific vignettes for the 
original physician work RVUs, Harvard worked with panels of experts, 
both inside and outside the Federal government, and obtained input from 
numerous physician specialty groups.
    Section 1848(b)(2)(B) of the Act specifies that the RVUs for 
anesthesia services are based on RVUs from a uniform relative value 
guide, with appropriate adjustment of the conversion factor (CF), in a 
manner to assure that fee schedule amounts for anesthesia services are 
consistent with those for other services of comparable value. We 
established a separate CF for anesthesia services, and we continue to 
utilize time units as a factor in determining payment for these 
services. As a result, there is a separate payment methodology for 
anesthesia services.
    We establish physician work RVUs for new and revised codes based on 
our review of recommendations received from the American Medical 
Association's (AMA) Specialty Society Relative Value Update Committee 
(RUC).
2. Practice Expense Relative Value Units (PE RVUs)
    Section 121 of the Social Security Act Amendments of 1994 (Pub. L. 
103-432), enacted on October 31, 1994, amended section 
1848(c)(2)(C)(ii) of the Act and required us to develop resource-based 
PE RVUs for each physician's service beginning in 1998. We were to 
consider general categories of expenses (such as office rent and wages 
of personnel, but excluding malpractice expenses) comprising PEs.
    Section 4505(a) of the Balanced Budget Act of 1997 (BBA) (Pub. L. 
105-33), amended section 1848(c)(2)(C)(ii) of the Act to delay 
implementation of the resource-based PE RVU system until January 1, 
1999. In addition, section 4505(b) of the BBA provided for a 4-year 
transition period from charge-based PE RVUs to resource-based RVUs.
    We established the resource-based PE RVUs for each physicians' 
service in a final rule, published November 2, 1998 (63 FR 58814), 
effective for services furnished in 1999. Based on the requirement to 
transition to a resource-based system for PE over a 4-year period, 
resource-based PE RVUs did not become fully effective until 2002.
    This resource-based system was based on two significant sources of 
actual PE data: The Clinical Practice Expert Panel (CPEP) data; and the 
AMA's Socioeconomic Monitoring System (SMS) data. The CPEP data were 
collected from panels of physicians, practice administrators, and 
nonphysicians (for example, registered nurses (RNs)) nominated by 
physician specialty societies and other groups. The CPEP panels 
identified the direct inputs required for each physician's service in 
both the office setting and out-of-office setting. We have since 
refined and revised these inputs based on recommendations from the RUC. 
The AMA's SMS data provided aggregate

[[Page 33524]]

specialty-specific information on hours worked and PEs.
    Separate PE RVUs are established for procedures that can be 
performed in both a nonfacility setting, such as a physician's office, 
and a facility setting, such as a hospital outpatient department. The 
difference between the facility and nonfacility RVUs reflects the fact 
that a facility typically receives separate payment from Medicare for 
its costs of providing the service, apart from payment under the PFS. 
The nonfacility RVUs reflect all of the direct and indirect PEs of 
providing a particular service.
    Section 212 of the Balanced Budget Refinement Act of 1999 (BBRA) 
(Pub. L. 106-113) directed the Secretary of Health and Human Services 
(the Secretary) to establish a process under which we accept and use, 
to the maximum extent practicable and consistent with sound data 
practices, data collected or developed by entities and organizations to 
supplement the data we normally collect in determining the PE 
component. On May 3, 2000, we published the interim final rule (65 FR 
25664) that set forth the criteria for the submission of these 
supplemental PE survey data. The criteria were modified in response to 
comments received, and published in the Federal Register (65 FR 65376) 
as part of a November 1, 2000 final rule. The PFS final rules published 
in 2001 and 2003, respectively, (66 FR 55246 and 68 FR 63196) extended 
the period during which we would accept these supplemental data through 
March 1, 2005.
    In the Calendar Year (CY) 2007 PFS final rule with comment period 
(71 FR 69624), we revised the methodology for calculating PE RVUs 
beginning in CY 2007 and provided for a 4-year transition for the new 
PE RVUs under this new methodology.
3. Resource-Based Malpractice (MP) RVUs
    Section 4505(f) of the BBA amended section 1848(c) of the Act 
requiring us to implement resource-based malpractice (MP) RVUs for 
services furnished on or after 2000. The resource-based MP RVUs were 
implemented in the PFS final rule published November 2, 1999 (64 FR 
59380). The MP RVUs were based on malpractice insurance premium data 
collected from commercial and physician-owned insurers from all the 
States, the District of Columbia, and Puerto Rico.
4. Refinements to the RVUs
    Section 1848(c)(2)(B)(i) of the Act requires that we review all 
RVUs no less often than every 5 years. The first 5-Year Review of the 
physician work RVUs was published on November 22, 1996 (61 FR 59489) 
and was effective in 1997. The second 5-Year Review was published in 
the CY 2002 PFS final rule with comment period (66 FR 55246) and was 
effective in 2002. The third 5-Year Review of physician work RVUs was 
published in the CY 2007 PFS final rule with comment period (71 FR 
69624) and was effective on January 1, 2007. (Note: Additional codes 
relating to the third 5-Year Review of physician work RVUs were 
addressed in the CY 2008 PFS final rule with comment period (72 FR 
66360).)
    In 1999, the AMA's RUC established the Practice Expense Advisory 
Committee (PEAC) for the purpose of refining the direct PE inputs. 
Through March 2004, the PEAC provided recommendations to CMS for over 
7,600 codes (all but a few hundred of the codes currently listed in the 
AMA's Current Procedural Terminology (CPT) codes). As part of the CY 
2007 PFS final rule with comment period (71 FR 69624), we implemented a 
new methodology for determining resource-based PE RVUs and are 
transitioning this over a 4-year period. (Note: In section II.A.2. of 
this proposed rule, we are proposing to use new survey data under the 
PE methodology.)
    In the CY 2005 PFS final rule with comment period (69 FR 66236), we 
implemented the first 5-Year Review of the MP RVUs (69 FR 66263). 
(Note: In section II.C. of this proposed rule, we are proposing to 
update the malpractice RVUs with the use of new data.)
5. Adjustments to RVUs are Budget Neutral
    Section 1848(c)(2)(B)(ii)(II) of the Act provides that adjustments 
in RVUs for a year may not cause total PFS payments to differ by more 
than $20 million from what they would have been if the adjustments were 
not made. In accordance with section 1848(c)(2)(B)(ii)(II) of the Act, 
if adjustments to RVUs cause expenditures to change by more than $20 
million, we make adjustments to ensure that expenditures do not 
increase or decrease by more than $20 million.
    As explained in the CY 2009 PFS final rule with comment period (73 
FR 69730), as required by section 133(b) of the Medicare Improvements 
for Patients and Providers Act of 2008 (MIPPA) (Pub. L. 110-275), the 
separate budget neutrality (BN) adjustor resulting from the third 5-
Year Review of physician work RVUs is being applied to the CF beginning 
with CY 2009 rather than the work RVUs.

B. Components of the Fee Schedule Payment Amounts

    To calculate the payment for every physicians' service, the 
components of the fee schedule (physician work, PE, and MP RVUs) are 
adjusted by a geographic practice cost index (GPCI). The GPCIs reflect 
the relative costs of physician work, PE, and malpractice expense in an 
area compared to the national average costs for each component.
    RVUs are converted to dollar amounts through the application of a 
CF, which is calculated by CMS' Office of the Actuary (OACT).
    The formula for calculating the Medicare fee schedule payment 
amount for a given service and fee schedule area can be expressed as:

Payment = [(RVU work x GPCI work) + (RVU PE x GPCI PE) + (RVU 
malpractice x GPCI malpractice)] x CF

C. Most Recent Changes to the Fee Schedule

    The CY 2009 PFS final rule with comment period (73 FR 69726) 
implemented changes to the PFS and other Medicare Part B payment 
policies finalized the CY 2008 interim RVUs and implemented interim 
RVUs for new and revised codes for CY 2009 to ensure that our payment 
systems are updated to reflect changes in medical practice and the 
relative value of services.
    The CY 2009 PFS final rule with comment period also addressed other 
policies, as well as certain provisions of the MIPPA.
    As required by the statute, and based on section 131 of the MIPPA, 
the CY 2009 PFS final rule with comment period also announced that the 
PFS update is 1.1 percent for CY 2009, the initial estimate for the 
sustainable growth rate for CY 2009 is 7.4 percent, and the conversion 
factor (CF) for CY 2009 is $36.0666.

II. Provisions of the Proposed Regulation

A. Resource-Based Practice Expense (PE) Relative Value Units (RVUs)

    Practice expense (PE) is the portion of the resources used in 
furnishing the service that reflects the general categories of 
physician and practitioner expenses, such as office rent and personnel 
wages but excluding malpractice expenses, as specified in section 
1848(c)(1)(B) of the Act.
    Section 121 of the Social Security Amendments of 1994 (Pub. L. 103-
432), enacted on October 31, 1994, required CMS to develop a 
methodology for a resource-based system for determining

[[Page 33525]]

PE RVUs for each physician's service. Until that time, PE RVUs were 
based on historical allowed charges. This legislation stated that the 
revised PE methodology must consider the staff, equipment, and supplies 
used in the provision of various medical and surgical services in 
various settings beginning in 1998. The Secretary has interpreted this 
to mean that Medicare payments for each service would be based on the 
relative PE resources typically involved with furnishing the service.
    The initial implementation of resource-based PE RVUs was delayed 
from January 1, 1998, until January 1, 1999, by section 4505(a) of the 
BBA. In addition, section 4505(b) of the BBA required that the new 
payment methodology be phased in over 4 years, effective for services 
furnished in CY 1999, and fully effective in CY 2002. The first step 
toward implementation of the statute was to adjust the PE values for 
certain services for CY 1998. Section 4505(d) of the BBA required that, 
in developing the resource-based PE RVUs, the Secretary must--
     Use, to the maximum extent possible, generally-accepted 
cost accounting principles that recognize all staff, equipment, 
supplies, and expenses, not solely those that can be linked to specific 
procedures and actual data on equipment utilization.
     Develop a refinement method to be used during the 
transition.
     Consider, in the course of notice and comment rulemaking, 
impact projections that compare new proposed payment amounts to data on 
actual physician PE.
    In CY 1999, we began the 4-year transition to resource-based PE 
RVUs utilizing a ``top-down'' methodology whereby we allocated 
aggregate specialty-specific practice costs to individual procedures. 
The specialty-specific PEs were derived from the American Medical 
Association's (AMA's) Socioeconomic Monitoring Survey (SMS). In 
addition, under section 212 of the BBRA, we established a process 
extending through March 2005 to supplement the SMS data with data 
submitted by a specialty. The aggregate PEs for a given specialty were 
then allocated to the services furnished by that specialty on the basis 
of the direct input data (that is, the staff time, equipment, and 
supplies) and work RVUs assigned to each CPT code.
    For CY 2007, we implemented a new methodology for calculating PE 
RVUs. Under this new methodology, we use the same data sources for 
calculating PE, but instead of using the ``top-down'' approach to 
calculate the direct PE RVUs, under which the aggregate direct and 
indirect costs for each specialty are allocated to each individual 
service, we now utilize a ``bottom-up'' approach to calculate the 
direct costs. Under the ``bottom up'' approach, we determine the direct 
PE by adding the costs of the resources (that is, the clinical staff, 
equipment, and supplies) typically required to provide each service. 
The costs of the resources are calculated using the refined direct PE 
inputs assigned to each CPT code in our PE database, which are based on 
our review of recommendations received from the AMA's Relative Value 
Update Committee (RUC). For a more detailed explanation of the PE 
methodology, see the Five-Year Review of Work Relative Value Units 
Under the PFS and Proposed Changes to the Practice Expense Methodology 
proposed notice (71 FR 37242) and the CY 2007 PFS final rule with 
comment period (71 FR 69629).

    Note: In section II.A.1 of this proposed rule, we discuss the 
current methodology used for calculating PE. In section II.A.2. of 
this proposed rule, which contains PE proposals for CY 2010, we are 
proposing to use data from the AMA Physician Practice Information 
Survey (PPIS) in place of the AMA's SMS survey data and supplemental 
survey data that is currently used in the PE methodology.

1. Current Methodology
a. Data Sources for Calculating Practice Expense
    The AMA's SMS survey data and supplemental survey data from the 
specialties of cardiothoracic surgery, vascular surgery, physical and 
occupational therapy, independent laboratories, allergy/immunology, 
cardiology, dermatology, gastroenterology, radiology, independent 
diagnostic testing facilities (IDTFs), radiation oncology, and urology 
are used to develop the PE per hour (PE/HR) for each specialty. For 
those specialties for which we do not have PE/HR, the appropriate PE/HR 
is obtained from a crosswalk to a similar specialty.
    The AMA developed the SMS survey in 1981 and discontinued it in 
1999. Beginning in 2002, we incorporated the 1999 SMS survey data into 
our calculation of the PE RVUs, using a 5-year average of SMS survey 
data. (See the CY 2002 PFS final rule with comment period (66 FR 
55246).) The SMS PE survey data are adjusted to a common year, 2005. 
The SMS data provide the following six categories of PE costs:
     Clinical payroll expenses, which are payroll expenses 
(including fringe benefits) for nonphysician clinical personnel.
     Administrative payroll expenses, which are payroll 
expenses (including fringe benefits) for nonphysician personnel 
involved in administrative, secretarial, or clerical activities.
     Office expenses, which include expenses for rent, mortgage 
interest, depreciation on medical buildings, utilities, and telephones.
     Medical material and supply expenses, which include 
expenses for drugs, x-ray films, and disposable medical products.
     Medical equipment expenses, which include depreciation, 
leases, and rent of medical equipment used in the diagnosis or 
treatment of patients.
     All other expenses, which include expenses for legal 
services, accounting, office management, professional association 
memberships, and any professional expenses not previously mentioned in 
this section.
    In accordance with section 212 of the BBRA, we established a 
process to supplement the SMS data for a specialty with data collected 
by entities and organizations other than the AMA (that is, those 
entities and organizations representing the specialty itself). (See the 
Criteria for Submitting Supplemental Practice Expense Survey Data 
interim final rule with comment period (65 FR 25664).) Originally, the 
deadline to submit supplementary survey data was through August 1, 
2001. In the CY 2002 PFS final rule (66 FR 55246), the deadline was 
extended through August 1, 2003. To ensure maximum opportunity for 
specialties to submit supplementary survey data, we extended the 
deadline to submit surveys until March 1, 2005 in the Revisions to 
Payment Policies Under the Physician Fee Schedule for CY 2004 final 
rule with comment period (68 FR 63196) (hereinafter referred to as CY 
2004 PFS final rule with comment period).
    The direct cost data for individual services were originally 
developed by the Clinical Practice Expert Panels (CPEP). The CPEP data 
include the supplies, equipment, and staff times specific to each 
procedure. The CPEPs consisted of panels of physicians, practice 
administrators, and nonphysicians (for example, RNs) who were nominated 
by physician specialty societies and other groups. There were 15 CPEPs 
consisting of 180 members from more than 61 specialties and 
subspecialties. Approximately 50 percent of the panelists were 
physicians.
    The CPEPs identified specific inputs involved in each physician's 
service provided in an office or facility setting.

[[Page 33526]]

The inputs identified were the quantity and type of nonphysician labor, 
medical supplies, and medical equipment. The CPEP data has been 
regularly updated by various RUC committees on PE.
b. Allocation of PE to Services
    The aggregate level specialty-specific PEs are derived from the 
AMA's SMS survey and supplementary survey data. To establish PE RVUs 
for specific services, it is necessary to establish the direct and 
indirect PE associated with each service.
    (i) Direct costs. The direct costs are determined by adding the 
costs of the resources (that is, the clinical staff, equipment, and 
supplies) typically required to provide the service. The costs of these 
resources are calculated from the refined direct PE inputs in our PE 
database. These direct inputs are then scaled to the current aggregate 
pool of direct PE RVUs. The aggregate pool of direct PE RVUs can be 
derived using the following formula: (PE RVUs x physician CF) x 
(average direct percentage from SMS /(Supplemental PE/HR data)).
    (ii) Indirect costs. The SMS and supplementary survey data are the 
source for the specialty-specific aggregate indirect costs used in our 
PE calculations. We then allocate the indirect costs to the code level 
on the basis of the direct costs specifically associated with a code 
and the greater of either the clinical labor costs or the physician 
work RVUs. For calculation of the 2010 PE RVUs, we use the 2008 
procedure-specific utilization data crosswalked to 2010 services. To 
arrive at the indirect PE costs--
     We apply a specialty-specific indirect percentage factor 
to the direct expenses to recognize the varying proportion that 
indirect costs represent of total costs by specialty. For a given 
service, the specific indirect percentage factor to apply to the direct 
costs for the purpose of the indirect allocation is calculated as the 
weighted average of the ratio of the indirect to direct costs (based on 
the survey data) for the specialties that furnish the service. For 
example, if a service is furnished by a single specialty with indirect 
PEs that were 75 percent of total PEs, the indirect percentage factor 
to apply to the direct costs for the purposes of the indirect 
allocation would be (0.75/0.25) = 3.0. The indirect percentage factor 
is then applied to the service level adjusted indirect PE allocators.
     We use the specialty-specific PE/HR from the SMS survey 
data, as well as the supplemental surveys for cardiothoracic surgery, 
vascular surgery, physical and occupational therapy, independent 
laboratories, allergy/immunology, cardiology, dermatology, radiology, 
gastroenterology, IDTFs, radiation oncology, and urology. (Note: For 
radiation oncology, the data represent the combined survey data from 
the American Society for Therapeutic Radiology and Oncology (ASTRO) and 
the Association of Freestanding Radiation Oncology Centers (AFROC)). As 
discussed in the CY 2008 PFS final rule with comment period (72 FR 
66233), the PE/HR survey data for radiology is weighted by practice 
size. We incorporate this PE/HR into the calculation of indirect costs 
using an index which reflects the relationship between each specialty's 
indirect scaling factor and the overall indirect scaling factor for the 
entire PFS. For example, if a specialty had an indirect practice cost 
index of 2.00, this specialty would have an indirect scaling factor 
that was twice the overall average indirect scaling factor. If a 
specialty had an indirect practice cost index of 0.50, this specialty 
would have an indirect scaling factor that was half the overall average 
indirect scaling factor.
     When the clinical labor portion of the direct PE RVU is 
greater than the physician work RVU for a particular service, the 
indirect costs are allocated based upon the direct costs and the 
clinical labor costs. For example, if a service has no physician work 
and 1.10 direct PE RVUs, and the clinical labor portion of the direct 
PE RVUs is 0.65 RVUs, we would use the 1.10 direct PE RVUs and the 0.65 
clinical labor portions of the direct PE RVUs to allocate the indirect 
PE for that service.
c. Facility and Nonfacility Costs
    Procedures that can be furnished in a physician's office, as well 
as in a hospital or facility setting have two PE RVUs: Facility and 
nonfacility. The nonfacility setting includes physicians' offices, 
patients' homes, freestanding imaging centers, and independent 
pathology labs. Facility settings include hospitals, ambulatory 
surgical centers (ASCs), and skilled nursing facilities (SNFs). The 
methodology for calculating PE RVUs is the same for both facility and 
nonfacility RVUs, but is applied independently to yield two separate PE 
RVUs. Because the PEs for services provided in a facility setting are 
generally included in the payment to the facility (rather than the 
payment to the physician under the PFS), the PE RVUs are generally 
lower for services provided in the facility setting.
d. Services With Technical Components (TCs) and Professional Components 
(PCs)
    Diagnostic services are generally comprised of two components: A 
professional component (PC) and a technical component (TC), both of 
which may be performed independently or by different providers. When 
services have TCs, PCs, and global components that can be billed 
separately, the payment for the global component equals the sum of the 
payment for the TC and PC. This is a result of using a weighted average 
of the ratio of indirect to direct costs across all the specialties 
that furnish the global components, TCs, and PCs; that is, we apply the 
same weighted average indirect percentage factor to allocate indirect 
expenses to the global components, PCs, and TCs for a service. (The 
direct PE RVUs for the TC and PC sum to the global under the bottom-up 
methodology.)
e. Transition Period
    As discussed in the CY 2007 PFS final rule with comment period (71 
FR 69674), the change to the PE methodology was implemented over a 4-
year period. In CY 2010, the transition period is concluded and PE RVUs 
will be calculated based entirely on the current methodology.
f. PE RVU Methodology
    The following is a description of the PE RVU methodology.
(i) Setup File
    First, we create a setup file for the PE methodology. The setup 
file contains the direct cost inputs, the utilization for each 
procedure code at the specialty and facility/nonfacility place of 
service level, and the specialty-specific survey PE per physician hour 
data.
(ii) Calculate the Direct Cost PE RVUs
Sum the Costs of Each Direct Input
    Step 1: Sum the direct costs of the inputs for each service. The 
direct costs consist of the costs of the direct inputs for clinical 
labor, medical supplies, and medical equipment. The clinical labor cost 
is the sum of the cost of all the staff types associated with the 
service; it is the product of the time for each staff type and the wage 
rate for that staff type. The medical supplies cost is the sum of the 
supplies associated with the service; it is the product of the quantity 
of each supply and the cost of the supply. The medical equipment cost 
is the sum of the cost of the equipment associated with the service; it 
is the product of the number of minutes each piece of equipment is used 
in the

[[Page 33527]]

service and the equipment cost per minute. The equipment cost per 
minute is calculated as described at the end of this section.
Apply a BN Adjustment to the Direct Inputs
    Step 2: Calculate the current aggregate pool of direct PE costs. To 
do this, multiply the current aggregate pool of total direct and 
indirect PE costs (that is, the current aggregate PE RVUs multiplied by 
the CF) by the average direct PE percentage from the SMS and 
supplementary specialty survey data.
    Step 3: Calculate the aggregate pool of direct costs. To do this, 
for all PFS services, sum the product of the direct costs for each 
service from Step 1 and the utilization data for that service.
    Step 4: Using the results of Step 2 and Step 3 calculate a direct 
PE BN adjustment so that the aggregate direct cost pool does not exceed 
the current aggregate direct cost pool and apply it to the direct costs 
from Step 1 for each service.
    Step 5: Convert the results of Step 4 to an RVU scale for each 
service. To do this, divide the results of Step 4 by the Medicare PFS 
CF.
(iii) Create the indirect PE RVUs.
Create indirect allocators.
    Step 6: Based on the SMS and supplementary specialty survey data, 
calculate direct and indirect PE percentages for each physician 
specialty.
    Step 7: Calculate direct and indirect PE percentages at the service 
level by taking a weighted average of the results of Step 6 for the 
specialties that furnish the service. Note that for services with TCs 
and PCs, we are calculating the direct and indirect percentages across 
the global components, PCs, and TCs. That is, the direct and indirect 
percentages for a given service (for example, echocardiogram) do not 
vary by the PC, TC and global component.
    Step 8: Calculate the service level allocators for the indirect PEs 
based on the percentages calculated in Step 7. The indirect PEs are 
allocated based on the three components: The direct PE RVU, the 
clinical PE RVU, and the work RVU.
    For most services the indirect allocator is: indirect percentage * 
(direct PE RVU/direct percentage) + work RVU.
    There are two situations where this formula is modified:
     If the service is a global service (that is, a service 
with global, professional, and technical components), then the indirect 
allocator is: Indirect percentage * (direct PE RVU/direct percentage) + 
clinical PE RVU + work RVU.
     If the clinical labor PE RVU exceeds the work RVU (and the 
service is not a global service), then the indirect allocator is: 
Indirect percentage * (direct PE RVU/direct percentage) + clinical PE 
RVU.

    Note: For global services, the indirect allocator is based on 
both the work RVU and the clinical labor PE RVU. We do this to 
recognize that, for the professional service, indirect PEs will be 
allocated using the work RVUs, and for the TC service, indirect PEs 
will be allocated using the direct PE RVU and the clinical labor PE 
RVU. This also allows the global component RVUs to equal the sum of 
the PC and TC RVUs.

    For presentation purposes in the examples in the Table 1, the 
formulas were divided into two parts for each service. The first part 
does not vary by service and is the indirect percentage * (direct PE 
RVU/direct percentage). The second part is either the work RVU, 
clinical PE RVU, or both depending on whether the service is a global 
service and whether the clinical PE RVU exceeds the work RVU (as 
described earlier in this step.)
Apply a BN Adjustment to the Indirect Allocators
    Step 9: Calculate the current aggregate pool of indirect PE RVUs by 
multiplying the current aggregate pool of PE RVUs by the average 
indirect PE percentage from the physician specialty survey data. This 
is similar to the Step 2 calculation for the direct PE RVUs.
    Step 10: Calculate an aggregate pool of indirect PE RVUs for all 
PFS services by adding the product of the indirect PE allocators for a 
service from Step 8 and the utilization data for that service. This is 
similar to the Step 3 calculation for the direct PE RVUs.
    Step 11: Using the results of Step 9 and Step 10, calculate an 
indirect PE adjustment so that the aggregate indirect allocation does 
not exceed the available aggregate indirect PE RVUs and apply it to 
indirect allocators calculated in Step 8. This is similar to the Step 4 
calculation for the direct PE RVUs.
Calculate the Indirect Practice Cost Index
    Step 12: Using the results of Step 11, calculate aggregate pools of 
specialty-specific adjusted indirect PE allocators for all PFS services 
for a specialty by adding the product of the adjusted indirect PE 
allocator for each service and the utilization data for that service.
    Step 13: Using the specialty-specific indirect PE/HR data, 
calculate specialty-specific aggregate pools of indirect PE for all PFS 
services for that specialty by adding the product of the indirect PE/HR 
for the specialty, the physician time for the service, and the 
specialty's utilization for the service.
    Step 14: Using the results of Step 12 and Step 13, calculate the 
specialty-specific indirect PE scaling factors as under the current 
methodology.
    Step 15: Using the results of Step 14, calculate an indirect 
practice cost index at the specialty level by dividing each specialty-
specific indirect scaling factor by the average indirect scaling factor 
for the entire PFS.
    Step 16: Calculate the indirect practice cost index at the service 
level to ensure the capture of all indirect costs. Calculate a weighted 
average of the practice cost index values for the specialties that 
furnish the service.

    Note: For services with TCs and PCs, we calculate the indirect 
practice cost index across the global components, PCs, and TCs. 
Under this method, the indirect practice cost index for a given 
service (for example, echocardiogram) does not vary by the PC, TC 
and global component.

    Step 17: Apply the service level indirect practice cost index 
calculated in Step 16 to the service level adjusted indirect allocators 
calculated in Step 11 to get the indirect PE RVU.
(iv) Calculate the Final PE RVUs
    Step 18: Add the direct PE RVUs from Step 6 to the indirect PE RVUs 
from Step 17.
    Step 19: Calculate and apply the final PE BN adjustment by 
comparing the results of Step 18 to the current pool of PE RVUs. This 
final BN adjustment is required primarily because certain specialties 
are excluded from the PE RVU calculation for ratesetting purposes, but 
all specialties are included for purposes of calculating the final BN 
adjustment. (See ``Specialties excluded from ratesetting calculation'' 
below in this section.)
(v) Setup File Information
     Specialties excluded from ratesetting calculation: For the 
purposes of calculating the PE RVUs, we exclude certain specialties 
such as midlevel practitioners paid at a percentage of the PFS, 
audiology, and low volume specialties from the calculation. These 
specialties are included for the purposes of calculating the BN 
adjustment.
     Crosswalk certain low volume physician specialties: 
Crosswalk the utilization of certain specialties with relatively low 
PFS utilization to the associated specialties.
     Physical therapy utilization: Crosswalk the utilization 
associated with all physical therapy services to the specialty of 
physical therapy.
     Identify professional and technical services not 
identified under the usual

[[Page 33528]]

TC and 26 modifiers: Flag the services that are PC and TC services, but 
do not use TC and 26 modifiers (for example, electrocardiograms). This 
flag associates the PC and TC with the associated global code for use 
in creating the indirect PE RVU. For example, the professional service 
code 93010 is associated with the global code 93000.
     Payment modifiers: Payment modifiers are accounted for in 
the creation of the file. For example, services billed with the 
assistant at surgery modifier are paid 16 percent of the PFS amount for 
that service; therefore, the utilization file is modified to only 
account for 16 percent of any service that contains the assistant at 
surgery modifier.
     Work RVUs: The setup file contains the work RVUs from this 
proposed rule.
(vi) Equipment cost per minute
    The equipment cost per minute is calculated as:

(1/(minutes per year * usage)) * price * ((interest rate/(1-(1/((1 + 
interest rate) ** life of equipment)))) + maintenance)

Where:

minutes per year = maximum minutes per year if usage were continuous 
(that is, usage = 1); 150,000 minutes.
usage = equipment utilization assumption; 0.9 for certain equipment 
(see section II.A.2. of this proposed rule) and 0.5. for others.
price = price of the particular piece of equipment.
interest rate = 0.11.
life of equipment = useful life of the particular piece of 
equipment.
maintenance = factor for maintenance; 0.05.

    Note: To illustrate the PE calculation, in Table 1 we have used 
the conversion factor (CF) of $36.0666 which is the CF effective 
January 1, 2009 as published in CY 2009 PFS final rule with comment 
period.

BILLING CODE 4120-01-P

[[Page 33529]]

[GRAPHIC] [TIFF OMITTED] TP13JY09.139


[[Page 33530]]


BILLING CODE 4120-01-C

    Note: Proposed PE RVU in Table 1, row 27, may not match Addendum 
B due to rounding.
    * The direct adj = [current PE RVUs * CF * avg dir pct] / [sum 
direct inputs] = [Step 2] / [Step 3]
    ** The indirect adj = [current PE RVUs * avg ind pct] / [sum of 
ind allocators] = [Step 9] / [Step 10]
2. PE Proposals for CY 2010
a. SMS and Supplemental Survey Background
    Currently, we use PE/HR obtained from the SMS surveys from 1995-
1999. For several specialties that collected additional PE/HR data 
through a more recent supplemental survey, we accepted and incorporated 
these data in developing current PE/HR values.
    While the SMS survey was not specifically designed for the purpose 
of establishing PE RVUs, we found these data to be the best available 
at the time. The SMS was a multi-specialty survey effort conducted 
using a consistent survey instrument and method across specialties. The 
survey sample was randomly drawn from the AMA Physician Masterfile to 
ensure national representativeness. The AMA discontinued the SMS survey 
in 1999.
    As required by the BBRA, we also established a process by which 
specialty groups could submit supplemental PE data. In the May 3, 2000 
interim final rule entitled, Medicare Program; Criteria for Submitting 
Supplemental Practice Expense Survey Data, (65 FR 25664), we 
established criteria for acceptance of supplemental data. The criteria 
were modified in the CY 2001 and CY 2003 PFS final rules with comment 
period (65 FR 65380 and 67 FR 79971, respectively). We currently use 
supplemental survey data for the following specialties: Cardiology; 
dermatology; gastroenterology; radiology; cardiothoracic surgery; 
vascular surgery; physical and occupational therapy; independent 
laboratories; allergy/immunology; independent diagnostic testing 
facilities (IDTFs); radiation oncology; medical oncology; and urology.
    Because the SMS data and the supplemental survey data are from 
different time periods, we have historically inflated them by the MEI 
to help put them on as comparable a time basis as we can when 
calculating the PE RVUs. This MEI proxy has been necessary in the past 
due to the lack of contemporaneous, consistently collected, and 
comprehensive multispecialty survey data.
b. Physician Practice Information Survey (PPIS)
    The AMA has conducted a new survey, the PPIS, which was expanded 
(relative to the SMS) to include nonphysician practitioners (NPPs) paid 
under the PFS. The PPIS, administered in CY 2007 and CY 2008, was 
designed to update the specialty-specific PE/HR data used to develop PE 
RVUs.
    The AMA and our contractor, The Lewin Group (Lewin), analyzed the 
PPIS data and calculated the PE/HR for physician and nonphysician 
specialties, respectively. The AMA's summary worksheets and Lewin's 
final report are available on the CMS Web site at http://www.cms.gov/
PhysicianFeeSched/. (See AMA PPIS Worksheets 1-3 and Lewin Group Final 
Report PPIS.) Table 2 shows the current indirect PE/HR based on SMS and 
supplemental surveys, the PPIS indirect PE/HR, and the indirect cost 
percentages of total costs.

                                Table 2--Indirect PE/HR and Indirect Percentages
                                               [Current and PPIS]
----------------------------------------------------------------------------------------------------------------
                                 Current        PPIS
          Specialty              indirect     indirect     Current        PPIS           Current crosswalk
                                  PE/HR        PE/HR     indirect  %  indirect  %
----------------------------------------------------------------------------------------------------------------
All Physicians...............       $59.04       $86.36           67           74
Allergy and Immunology.......       153.29       162.68           62           67
Anesthesiology...............        19.76        29.37           56           82
Audiology....................        59.04        72.17           67           85  All Physicians.
Cardiology...................       131.02        88.04           56           65
Cardiothoracic Surgery.......        61.75        67.83           68           83
Chiropractor.................        49.60        65.33           69           86  Internal Medicine.
Clinical Laboratory (Billing         66.46        71.01           37           37
 Independently) *.
Clinical Psychology..........        29.07        20.07           90           93  Psychiatry.
Clinical Social Work.........        29.07        17.80           90           97  Psychiatry.
Colon & Rectal Surgery.......        53.93        90.85           77           80
Dermatology..................       158.49       184.62           70           70
Emergency Medicine...........        36.85        38.36           88           94
Endocrinology................        49.60        84.39           69           73
Family Medicine..............        52.79        90.15           62           76
Gastroenterology.............       101.30        96.78           70           75
General Practice.............        52.79        78.59           62           69
General Surgery..............        53.93        82.74           77           82
Geriatrics...................        49.60        54.14           69           74
Hand Surgery.................        98.56       148.78           72           77
Independent Diagnostic              466.16       501.45           50           50
 Testing Facilities *.
Internal Medicine............        49.60        84.03           69           76
Interventional Pain Medicine.        59.04       156.79           67           70
Interventional Radiology.....       118.48        82.55           58           81
Medical Oncology.............       141.84       129.94           59           56
Nephrology...................        49.60        66.00           69           80
Neurology....................        66.05       110.39           74           87
Neurosurgery.................        89.64       115.76           86           87
Nuclear Medicine.............       118.48        39.80           58           77
Obstetrics/Gynecology........        69.74        99.32           67           67
Ophthalmology................       103.28       170.08           65           70
Optometry....................        59.04        88.02           67           77  All Physicians.
Oral Surgery (Dentist only)..        96.01       173.19           71           65  Otolaryngology.

[[Page 33531]]


Orthopaedic Surgery..........        98.56       131.40           72           81
Osteopathic Manipulative             59.04        53.93           67           93
 Therapy.
Otolaryngology...............        96.01       141.53           71           75
Pain Medicine................        59.04       122.41           67           70
Pathology....................        59.80        74.98           70           74
Pediatrics...................        51.52        76.27           62           69
Physical Medicine and                84.92       110.13           71           84
 Rehabilitation.
Physical Therapy.............        35.17        57.26           65           84
Plastic Surgery..............        99.32       134.82           67           74
Podiatry.....................        59.04        74.76           67           82  All Physicians.
Psychiatry...................        29.07        30.09           90           94
Pulmonary Disease............        44.63        55.26           76           74
Radiation Oncology (Hospital        114.00       126.66           50           56
 Based & Freestanding).
Radiology....................       118.48        95.60           58           71
Registered Dieticians........        59.04        18.45           67           84  All Physicians.
Rheumatology.................        84.92        98.08           71           67
Urology......................       119.57        97.02           69           73
Vascular Surgery.............        60.10        83.98           63          73
----------------------------------------------------------------------------------------------------------------
\*\ Did not participate in PPIS. Data based on Supplemental Survey.

    The PPIS is a multispecialty, nationally representative, PE survey 
of both physician and NPPs using a consistent survey instrument and 
methods highly consistent with those used for the SMS and the 
supplemental surveys. The PPIS has gathered information from 3,656 
respondents across 51 physician specialty and health care professional 
groups. We believe the PPIS is the most comprehensive source of PE 
survey information available to date.
    As noted, the BBRA required us to establish criteria for accepting 
supplemental survey data. Since the supplemental surveys were specific 
to individual specialties and not part of a comprehensive 
multispecialty survey, we had required certain precision levels be met 
in order to ensure that the supplemental data was sufficiently valid, 
and to be accepted for use in the development of the PE RVUs. Because 
the PPIS is a contemporaneous, consistently collected, and 
comprehensive multispecialty survey, we do not believe similar 
precision requirements are necessary and are not proposing to establish 
them for the use of the PPIS data.
    For physician specialties, the survey responses were adjusted for 
non-response bias. Non-response bias is the bias that results when the 
characteristics of survey respondents differ in meaningful ways, such 
as in the mix of practice sizes, from the general population. The non-
response adjustment was developed based on a comparison of practice 
size and other characteristic information between the PPIS survey 
respondents and data from the AMA Masterfile (for physician 
specialties) or information from specialty societies (for non-physician 
specialties). For six specialties (that is, chiropractors, clinical 
social workers, nuclear medicine, osteopathic manipulative therapy, 
physical therapy, and registered dietians) such an adjustment was not 
possible due to a lack of available characteristic data. The AMA and 
Lewin have indicated that the non-response weighting has only a small 
impact on PE/HR values.
    Under our current policy, various specialties without SMS or 
supplemental survey data have been crosswalked to other similar 
specialties to obtain a proxy PE/HR. For specialties that were part of 
the PPIS for which we currently use a crosswalked PE/HR, we are 
proposing instead to use the PPIS-based PE/HR. We are proposing to 
continue current crosswalks for specialties that did not participate in 
PPIS.
    Supplemental survey data on independent labs, from the College of 
American Pathologists, was implemented for payments in CY 2005. 
Supplemental survey data from the National Coalition of Quality 
Diagnostic Imaging Services (NCQDIS), representing IDTFs, was blended 
with supplementary survey data from the American College of Radiology 
(ACR) and implemented for payments in CY 2007. Neither IDTFs nor 
Independent Labs participated in PPIS. Therefore, we are proposing to 
continue using the current PE/HR that was developed using their 
supplemental survey data.
    We are not proposing to use the PPIS data for reproductive 
endocrinology, sleep medicine, and spine surgery since these 
specialties are not separately recognized by Medicare and we do not 
know how to blend this data with the Medicare recognized specialty 
data. We seek comment on this issue.
    We are not proposing changes to the manner in which the PE/HR data 
are used in the current PE RVU methodology. We are merely proposing to 
update the PE/HR data itself based on the new survey. We propose to 
utilize the PE/HR developed using PPIS data for all Medicare recognized 
specialties that participated in the PPIS for payments effective 
January 1, 2010. The impact of using the new PPIS-based PE/HR is 
discussed in the Regulatory Impact Analysis in section V. of this 
proposed rule.
c. Equipment Utilization Rate
    As part of the PE methodology associated with the allocation of 
equipment costs for calculating PE RVUs, we have adopted an equipment 
usage assumption of 50 percent. Most recently, we included a discussion 
in the CY 2008 PFS proposed rule on this equipment usage assumption (72 
FR 38132). We noted that if the assumed equipment usage percentage is 
set too high, the result would be an insufficient allowance at the 
service level for the practice costs associated with equipment. If the 
assumed equipment usage percentage is set too low, the result would be 
an excessive allowance for the practice costs of equipment at the 
service level. We acknowledged that

[[Page 33532]]

the current 50 percent usage assumption does not capture the actual 
usage rates for all equipment, but stated that we did not believe that 
we had strong empirical evidence to justify any alternative approaches.
    The commenters' recommendations about making adjustments to the 50 
percent utilization rate assumption varied. Certain commenters 
recommended we do nothing until stronger empirical evidence is 
available, while other commenters recommended a decrease in the 
utilization assumption, and some commenters recommended an increase in 
the utilization assumption. The particular changes recommended in the 
utilization assumption were, in most cases, directly related to a 
specific code.
    In the CY 2008 PFS final rule with comment period (72 FR 66232), we 
agreed with commenters that the equipment utilization rate should 
continue to be examined for accuracy. We reiterated our commitment to 
continue to work with interested parties on this issue. We indicated 
that we would continue to monitor the appropriateness of the equipment 
utilization assumption, and evaluate whether changes should be proposed 
in light of the data available.
    Since the publication of the CY 2008 PFS final rule with comment 
period, MedPAC addressed this issue again in its March 2009 Report to 
Congress (see http://www.medpac.gov/documents/Mar09_EntireReport.pdf). 
In part of its discussion, MedPAC stated:

    ``In 2006, the Commission sponsored a survey by NORC of imaging 
providers in six markets, which found that MRI and CT machines are 
used much more than the 25 hours per week that CMS assumes (Table 
2B-6). According to data from this survey, MRI scanners are used 52 
hours per week, on average (median of 46 hours), and CT machines are 
operated 42 hours per week, on average (median of 40 hours) (NORC 
2006).\32\ Although the survey results are not nationally 
representative, they are representative of imaging providers in the 
six markets included in the survey. We also analyzed data from a 
2007 survey of CT providers by IMV, a market research firm (IMV 
Medical Information Division 2008). IMV data are widely used in the 
industry and have also appeared in published studies (Baker et al. 
2008, Baker and Atlas 2004). Using IMV's data on 803 nonhospital CT 
providers (imaging centers, clinics, and physician offices), we 
calculated that the average provider uses its CT scanner 50 hours 
per week, which is twice the number CMS assumes.\33\ The IMV survey 
also found that nonhospital providers increased the average number 
of procedures per CT machine by 31 percent from 2003 to 2007, which 
indicates that providers either used their machines more hours per 
day or performed more scans per hour (IMV Medical Information 
Division 2008).'' (p. 108)

    We believe the studies cited by MedPAC strongly suggest that our 
current usage rate assumption is significantly understated, especially 
with respect to the types of high cost equipment that were the subject 
of the studies. Our current 50 percent utilization rate translates into 
about 25 hours per week out of a 50 hour work week. The median value of 
46 hours for MRIs from the first study cited by MedPAC is equivalent to 
a utilization rate of 92 percent on a 50-hour week. For CT scanners, 
averaging the value from the first study of 40 hours per week and the 
value from the second study of 50 hours per week yields 45 hours and is 
equivalent to a 90 percent utilization rate on a 50 hour work week. We 
believe the studies cited by MedPAC suggest what we have long 
suspected, that physicians and suppliers would not typically make huge 
capital investments in equipment that would only be utilized 50 percent 
of the time. All of the equipment cited in the MedPAC studies is priced 
over $1 million. Therefore, we are proposing to change the equipment 
usage assumption from the current 50 percent usage rate to a 90 percent 
usage rate for equipment priced over $1 million. We will continue to 
explore data sources regarding the utilization rates of equipment 
priced at less than $1 million dollars, but are not proposing a change 
in the usage rate for this less expensive equipment at this time.
    As MedPAC indicated in its report, we do not believe this proposal 
would create access issues in rural areas. MedPAC noted,

    ``According to our analysis of data from the American Hospital 
Association's 2006 AHA annual survey of hospitals, 95% of rural 
hospitals provide CT services in their community (AHA 2007). 
Therefore, if rural areas do not have physician offices or 
freestanding centers with MRI and CT machines, most of these 
communities have access to such services through a hospital.'' (p. 
110)

    However, we welcome any additional analyses regarding access 
issues, and, as in our CY 2008 and CY 2009 rulemaking, we welcome 
additional empirical data relating to equipment utilization rates. Our 
understanding is that the PPIS survey did not produce information that 
can inform the utilization rate discussion, but we invite comments on 
this or other data sources.
d. Miscellaneous PE Issues
    As we have discussed in the past rulemaking (see the CY 2008 PFS 
final rule with comment period (72 FR 66236) and the CY 2007 PFS final 
rule with comment period (71 FR 69647)), we continue to have concerns 
about the issue of PE RVUs for services which are utilized 24 hours a 
day/7 days a week, such as certain monitoring systems. For example, the 
PE equipment methodology was not developed with this type of 24/7 
equipment in mind. We are continuing to analyze the issue of PEs for 
services which are utilized 24 hours a day/7 days a week to identify 
any modifications to our methodology that would address the specific 
``constant use'' issues associated with these services. Services that 
are currently contractor priced in CY 2009 would remain contractor 
priced in CY 2010. Any proposed changes will be communicated through 
future rulemaking.
    We also received comments regarding the PE direct cost inputs (for 
example, supply costs and the useful life of the renewable sources) 
related to several high dose radiation therapy (HDRT) and placement CPT 
codes. Based on our review of these codes and comments received, we are 
requesting that the AMA RUC consider these CPT codes for additional 
review.
e. AMA RUC Recommendations for Direct PE Inputs
    The AMA RUC provided recommendations for PE inputs for the codes 
listed in Table 3.

             Table 3--Codes With AMA RUC PE Recommendations
------------------------------------------------------------------------
         CPT \1\ code                          Description
------------------------------------------------------------------------
37183.........................  Remove hepatic shunt (tips).
47382.........................  Percut ablate liver rf.
50200.........................  Biopsy of kidney.
55873.........................  Cryoablate prostate.
93025.........................  Microvolt t-wave assess.
------------------------------------------------------------------------
\1\ CPT codes and descriptions are Copyright 2009 American Medical
  Association.

We are in agreement with the AMA RUC recommendations for the direct PE 
inputs for the codes listed in Table 3 and propose to adopt these for 
CY 2010.

B. Geographic Practice Cost Indices (GPCIs): Locality Discussion

1. Update--Expiration of 1.0 Work GPCI Floor
    Section 1848(e)(1)(A) of the Act requires us to develop separate 
Geographic Practice Cost Indices (GPCIs) to measure resource cost 
differences among localities compared to the national average for each 
of the three fee schedule components (that is, work, PE and 
malpractice). While requiring that the PE and malpractice GPCIs reflect 
the full relative cost differences, section 1848(e)(1)(A)(iii) of

[[Page 33533]]

the Act requires that the physician work GPCIs reflect only one-quarter 
of the relative cost differences compared to the national average.
    Section 1848(e)(1)(C) of the Act requires us to review and, if 
necessary, adjust the GPCIs at least every 3 years. This section also 
specifies that if more than 1 year has elapsed since the last GPCI 
revision, we must phase in the adjustment over 2 years, applying only 
one-half of any adjustment in each year. As discussed in the CY 2009 
PFS final rule with comment period (73 FR 69740), the CY 2009 
adjustment to the GPCIs reflected the fully implemented fifth 
comprehensive GPCI update. We also noted that section 134 of the MIPPA 
extended the 1.000 work GPCI floor from July 1, 2008, through December 
31, 2009. (Note: The 1.000 work GPCI floor was enacted and implemented 
for CY 2006, and, prior to enactment of the MIPPA, was set to expire on 
June 30, 2008.) Additionally, section 1848(e)(1)(G) of the Act, as 
amended by section 134(b) of the MIPPA, set a permanent 1.5 work GPCI 
floor in Alaska for services furnished beginning January 1, 2009. 
Therefore, as required by the MIPPA, beginning on January 1, 2010, the 
1.000 work GPCI floor will be removed. However, the 1.500 work GPCI 
floor for Alaska will remain in place. See Addenda D and E of this 
proposed rule for the GPCIs and summarized geographic adjustment 
factors (GAFs), respectively.
2. Payment Localities
a. Background
    As stated above in this section, section 1848(e)(1)(A) of the Act 
requires us to develop separate GPCIs to measure resource cost 
differences among localities compared to the national average for each 
of the three fee schedule components (this is, work, PE, and 
malpractice). Payments under the PFS are based on the relative 
resources involved in furnishing physicians' services, and are adjusted 
for differences in relative resource costs among payment localities 
using the GPCIs. As a result, PFS payments vary between localities.
    The current PFS locality structure was developed and implemented in 
1997. There are currently 89 localities including 37 higher-cost areas; 
16 Rest of State areas (comprising the remaining counties not located 
in a higher-cost area within a State); 34 Statewide areas; and Puerto 
Rico and the Virgin Islands which are designated as ``territory-wide'' 
localities. The development of the current locality structure is 
described in detail in the CY 1997 PFS proposed rule (61 FR 34615) and 
the subsequent final rule (61 FR 59494).
    As we have frequently noted, any changes to the locality 
configuration must be made in a budget neutral manner. Therefore, any 
change in localities can lead to significant redistributions in 
payments. For many years, we have not considered making changes to 
localities without the support of a State medical association in order 
to demonstrate consensus for the change among the professionals whose 
payments would be affected (with some increasing and some decreasing). 
However, we have recognized that, over time, changes in demographics or 
local economic conditions may lead us to conduct a more comprehensive 
examination of existing payment localities.
Payment Locality Approaches Discussed in the CY 2008 PFS Proposed Rule
    For the past several years, we have been involved in discussions 
with California physicians and their representatives about recent 
shifts in relative demographics and economic conditions among a number 
of counties within the current California payment locality structure. 
In the CY 2008 PFS proposed rule and final rule with comment period, we 
described three potential options for changing the payment localities 
in California (72 FR 38139 and 72 FR 66245, respectively).
    After reviewing the comments on these options, we decided not to 
proceed with implementing any of them at that time. We explained that 
there was no consensus among the California medical community as to 
which, if any, of the options would be most acceptable. We also 
received suggestions from the Medicare Payment Advisory Commission 
(MedPAC) for developing changes in payment localities for the entire 
country and other States expressed interest in having their payment 
localities reconfigured as well. In addition, other commenters wanted 
us to consider a national reconfiguration of localities rather than 
just making changes one State at a time. Because of the divergent views 
expressed in comments, we explained in the CY 2008 PFS final rule with 
comment period that we intended to conduct a thorough analysis of 
potential approaches to reconfiguring localities and would address this 
issue again in future rulemaking.
Interim Study of Alternative Payment Localities Under the PFS
    As a follow-up to the CY 2008 PFS final rule with comment period, 
we contracted with Acumen, LLC (Acumen), to conduct a preliminary study 
of several options for revising the payment localities on a nationwide 
basis. The contractor's interim report was posted on the CMS Web site 
on August 21, 2008, and we requested comments from the public. The 
report entitled, ``Review of Alternative GPCI Payment Locality 
Structures,'' is still accessible from the CMS PFS Web page under the 
heading ``Interim Study of Alternative Payment Localities under the 
PFS.'' The report may also be accessed directly from the following 
link: http://www.cms.hhs.gov/PhysicianFeeSched/10_Interim_
Study.asp#TopOfPage. We accepted comments on the interim report through 
November 3, 2008. The alternative locality configurations discussed in 
the report are described briefly below in this section.
Option 1: CMS Core Based Statistical Area (CBSA) Payment Locality 
Configuration
    This option uses the Office of Management and Budget (OMB's) 
Metropolitan Statistical Area (MSA) designations for the payment 
locality configuration. MSAs would be considered as urban CBSAs. 
Micropolitan Areas (as defined by OMB) and rural areas would be 
considered as non-urban (rest of State) CBSAs. This approach would be 
consistent with the inpatient hospital prospective payment system 
(IPPS) pre-reclassification CBSA assignments and with the geographic 
payment adjustments used in other Medicare payment systems. This option 
would increase the number of localities from 89 to 439.
Option 2: Separate High Cost Counties From Existing Localities 
(Separate Counties)
    Under this approach, higher cost counties are removed from their 
existing locality structure and they would each be placed into their 
own locality. This option would increase the number of localities from 
89 to 214 using a 5 percent GAF differential to separate high cost 
counties.
Option 3: Separate MSAs From Statewide Localities (Separate MSAs)
    This option begins with Statewide localities and creates separate 
localities for higher cost MSAs (rather than removing higher cost 
counties from their existing locality as described in option 2). This 
option would increase the number of localities from 89 to 130 using a 5 
percent GAF differential to separate high cost MSAs.

[[Page 33534]]

Option 4: Group Counties Within a State Into Locality Tiers Based on 
Costs (Statewide Tiers)
    This option creates tiers of counties (within each State) that may 
or may not be contiguous but share similar practice costs. This option 
would increase the number of localities from 89 to 140 using a 5 
percent GAF differential to group similar counties into Statewide 
tiers.
    Additionally, as discussed in the interim locality study report, 
our contractor, Acumen, applied a ``smoothing'' adjustment to the 
current PFS locality structure, as well as to each of the alternative 
locality configurations (except option 4: Statewide Tiers). The 
``smoothing'' adjustment was applied to mitigate large payment 
differences (or payment ``cliffs'') between adjacent counties. Since 
large payment differences between adjacent counties could influence a 
physician's decision on a practice location (and possibly impact access 
to care), the ``smoothing'' adjustment was applied to ensure that GAF 
differences between adjacent counties do not exceed 10 percent. (For 
more information on the ``smoothing'' adjustment see the interim 
locality study report on the PFS Web page via the link provided above.)
b. Summary of Public Comments on Interim Locality Study Report
    In the CY 2009 PFS proposed rule (73 FR 38514), we encouraged 
interested parties to submit comments on the options presented both in 
the proposed rule and in the interim report posted on our Web site. We 
also requested comments and suggestions on other potential alternative 
locality configurations (in addition to the options described in the 
report). Additionally, we requested comments on the administrative and 
operational issues associated with the various options under 
consideration. We also emphasized that we would not be proposing any 
changes to the current PFS locality structure for CY 2009 and that we 
would provide extensive opportunities for public comment before 
proposing any change. The following is a summary of the comments 
received on the alternative locality options discussed in the CY 2009 
PFS proposed rule and interim locality study report.
(1) Introduction and General Support for Change
    We received approximately 200 comments on the CY 2009 PFS proposed 
rule and locality study report from various specialty groups, medical 
societies, State medical associations, individual practitioners, and 
beneficiaries. Commenters generally commended us for acknowledging the 
need to reconfigure PFS payment localities and expressed support for 
our study of alternative locality configurations. Many commenters urged 
us to expedite changes to the current locality structure in order to 
accurately reflect the geographic cost differences of operating a 
medical practice. For example, the Connecticut State Medical Society 
commented that the current locality configuration contributes to 
medical access issues and problems with recruitment and retention of 
practitioners (with an emphasis on access to primary care).
    Another commenter stated that Ohio's Statewide locality 
configuration needs to be changed because a Statewide locality 
designation does not account for the (presumably higher) cost of 
operating a medical practice in northern Ohio. The commenter also 
objected to the agency's approach to requests for changes to the 
current locality structure (which includes an assessment of support for 
the changes by the medical community, including the relevant State 
medical associations). The commenter believes the State medical 
association does not represent all of the physicians in Ohio.
    Another commenter stated that a change in the PFS locality 
structure is long overdue. The commenter stated that San Diego County 
is the most underpaid area in the nation and that grouping that county 
with the Rest of California locality is erroneous. Moreover, several 
commenters stated that a timely reassessment is needed and urged us to 
update the locality structure every 3 years. Two commenters believe 
that previous studies completed on the PFS locality structure by 
MedPAC, GAO, Urban Institute, as well as the current study by Acumen, 
support immediate reform to the current PFS locality structure.
    We received many comments from hospitals and physicians located in 
Frederick County Maryland (which is currently grouped with the Rest of 
Maryland locality). The commenters support each of the alternative 
locality configurations we presented because each option results in PFS 
payment increases for services furnished in Frederick County. The 
commenters stated that Frederick County is considered a `bedroom 
community' for the DC/Northern Virginia area, has experienced the 
highest growth rate in the State, and noted that the cost of living has 
increased significantly. Additionally, the commenters noted that the 
last economic census aligns costs in Frederick County with those in 
Montgomery County (whose doctors receive higher payment amounts) and 
that Frederick County competes with physician practices in Montgomery 
County for professional staff. Moreover, the commenters believe that 
because of inadequate PFS payment amounts, access to care is becoming a 
problem and emergency room visits are on the rise.
(2) Cautious Approach
    Some commenters requested that we take a cautious approach to 
reconfiguring the locality structure. For instance, the Texas Medical 
Association stated that because of the redistributive impact that 
results from any locality reconfiguration, CMS should avoid making 
large scale changes at one time. Additionally, another commenter stated 
that ``stakeholders'' should be given a long advance notification 
period (at least 2 full calendar years) prior to the effective date of 
any changes to the PFS locality configuration. The commenter also 
stated that the current locality structure should remain in place (for 
each locality) unless the need for revision is strongly substantiated 
because of a change in practice cost patterns. A specialty society 
expressed support for postponing any adjustments for at least 1 year to 
allow for more discussion between CMS and ``stakeholders''.
(3) Guiding Principles
    We received several comments from California that suggested a set 
of goals for reforming the PFS payment locality structure. The goals 
suggested by the commenters are as follows:
     Improve payment accuracy (as compared to the current 
locality structure);
     Move towards MSA-based localities;
     Mitigate payment reductions to rural California areas (and 
therefore minimize corresponding negative impact on access to care in 
California); and
     Promote administrative simplification by aligning 
physician and hospital payment localities.
    The California Medical Association (CMA) urged us to apply a 
consistent methodology across all payment localities and requested that 
any revision to the localities include a ``formula driven'' mechanism 
that can be applied repeatedly to future revisions. A California county 
medical society stated that more specific objectives for reforming PFS 
payment localities should be developed. For example, the commenter 
suggested that

[[Page 33535]]

payment reductions for practitioners should not exceed 1.5 percent in 
any given year, GAF differentials between adjacent localities should 
not exceed 10 percent, and that contiguous localities with less than a 
1 percent difference in their GAF's should be combined into a single 
locality.
(4) Comments on the Studied Alternative Locality Options
    We received many comments on the options for reconfiguring PFS 
payment localities presented in the interim locality study report. One 
commenter stated that option 1 (the CMS CBSA locality configuration) is 
the best option because it provides the greatest payment accuracy. The 
same commenter also stated that using CBSAs as the PFS locality 
definition would be similar to other Medicare payment systems (for 
example, the IPPS). Therefore, the commenter believed that geographic 
payment adjustments for physicians and hospitals would be consistent 
for a given geographic area. The CMA and a California county medical 
society stated that although option 1 would provide the greatest 
payment accuracy, it would also lead to significant payment reductions 
for many counties. Those same commenters expressed concern with the 
negative impact of transitioning directly to the CMS CBSA locality 
configuration. If adopted, the commenters suggested that the CMS CBSA 
locality configuration be implemented in stages over several years. The 
Texas Medical Association echoed this concern and urged us not to adopt 
option 1 unless we employ a hold harmless floor along with ``material'' 
increases in the conversion factor.
    The Texas Medical Association also stated that option 2 (Separate 
High Cost Counties from Existing Localities) results in less 
significant payment reductions to rural practitioners, as compared to 
the reductions seen under option 1 (CMS CBSA) and option 4 (Statewide 
Tiers). However, the commenter did not support option 2 because it 
would create different localities within major urban areas and, 
therefore, provide incentives for ``border-crossing,'' (in other words, 
incentives for physicians to move their medical practice to an adjacent 
urbanized county to obtain a higher payment amount). Additionally, the 
Texas Medical Association stated that option 2 increases administrative 
complexity due to the additional number of localities and the need to 
reallocate source data into smaller (county level) areas. The CMA also 
stated that option 2 results in less significant payment reductions (as 
compared to the other options). However, the CMA stated that option 2 
continues to produce inaccurate payments because it applies MSA-based 
data to county-based localities.
    Many commenters from the State of California expressed support for 
option 3 (Separate High Cost MSAs from Statewide Localities) because 
the commenters believed it would improve payment accuracy (over the 
current locality configuration) and at the same time mitigate the 
payment reductions to rural areas that would occur under option 1 (CMS 
CBSA) and option 4 (Statewide Tiers). The CMA explained that selecting 
an MSA-based locality approach would provide consistency with the 
hospital payment system and enable physicians to better compete with 
hospitals for the local work force. For example, the commenters stated 
that hospitals located in the Santa Cruz MSA are some of the highest 
paid in the nation. However, under the PFS locality structure, Santa 
Cruz County is grouped with the Rest of California locality, which is 
the lowest paid PFS locality in the State.
    The Texas Medical Association suggested that we adopt option 3 
because it minimizes payment reductions to lower cost rural areas. For 
example, since option 3 results in the fewest payment localities (as 
compared to the other alternative locality configurations), it reduces 
the redistribution effects of separating higher cost areas from rural 
``rest of State'' areas. The commenter also stated that option 3 
(Separate MSAs) matches payment with the underlying data better than 
option 2 (Separate Counties) and option 4 (Statewide Tiers). Some 
commenters expressed their belief that MSAs are better basic locality 
units than counties because the cost data is more reliably derived 
directly from MSAs (instead of counties). Several commenters who 
supported the adoption of an MSA-based PFS locality structure suggested 
that option 3 could be used as a transition to the CMS CBSA locality 
configuration (option 1).
    With regard to option 4 (Statewide Tiers), the Texas Medical 
Association stated that the Statewide Tiers locality configuration 
creates payment areas that are poorly aligned with the underlying data 
and results in unacceptable payment decreases to small urban and rural 
areas. The Florida Medical Association explained that many localities 
have experienced a shift in population and economic development since 
the last PFS locality reconfiguration. The commenter stated that 
counties with similar costs should be grouped together in the same 
locality regardless of geographic location and that the Statewide cost 
tier locality structure (option 4) would accomplish this objective. The 
CMA stated that under option 4, counties are not geographically 
contiguous and noted that the counties grouped together in a locality 
may not be related to one another economically. The commenter suggested 
that noncontiguous counties may experience more frequent economic 
changes than contiguous counties. The commenter expressed concern that 
option 4 would need to be updated more frequently and therefore 
payments to physicians will fluctuate more often. A California county 
medical society stated that option 4 creates payment errors for 
counties in seven California localities that currently have accurate 
payments. The Connecticut State Medical Society stated that New Haven 
County would experience an increase under option 4.
(5) Smoothing Adjustment
    Many commenters from the State of California did not support the 
concept of ``smoothing'' because it would require payment reductions 
for higher cost counties to offset the increases given to lower cost 
counties (in order to achieve budget neutrality). Additionally, the 
same commenters stated that physicians in ``smoothed'' counties benefit 
financially from the smoothing adjustment solely because they are 
located adjacent to high cost areas. They also stated that a 
``smoothing'' adjustment would be complex to administer, and difficult 
to understand. The CMA, a California county medical society, and 
another commenter from California stated that a ``smoothing'' 
adjustment would require a change in the statute and that current 
Medicare statute requires GPCIs to reflect the relative costs 
differences among localities for work, PE, and malpractice expense. 
Another commenter recommended that we study the extent to which a 
``smoothing'' adjustment can be used as a temporary measure; in order 
to phase-in significant changes in payment levels resulting from a PFS 
locality reconfiguration.
(6) Other Alternative Options
    A few commenters submitted suggestions on other potential 
alternative PFS locality configurations in addition to those discussed 
in the interim report. For example, one medical clinic suggested a 
``market-based'' approach instead of the current ``cost-based'' 
methodology. Under this approach, PFS payment would be geographically 
adjusted based on the ratio of Medicare participating

[[Page 33536]]

physicians to Medicare beneficiaries. The commenter suggested that 
payment amounts should be increased in geographic areas with a low 
physician to Medicare beneficiary ratio (for example, 1 physician for 
every 3,000 beneficiaries) and decreased in areas with a higher ratio 
(for example, 1 physician for every 200 beneficiaries). The commenter 
stated that ``this process could be used to bring physician to patient 
ratios in the United States to equilibrium.''
    The CMA and a California county medical society suggested 
variations of option 2 (Separate Counties) with the intention of 
reducing the number of localities that would result under this option. 
The commenters suggested adopting a ``basic locality unit'' (for 
example, MSA) instead of a county when removing areas from an existing 
locality. For example, if 5 counties are removed from a ``Rest of 
State'' locality, and included within the same MSA, the 5 counties 
would be grouped into a single new locality rather than 5 separate new 
localities. The commenter also suggested that if removed counties are 
contiguous and have similar costs (even if not part of same MSA); they 
should be consolidated into one new locality instead of separate 
localities. The commenters stated that either of these variations would 
reduce the number of new localities created under option 2.
    Additionally, the CMA and a California county medical society 
suggested a variation of option 4 (Statewide Tiers). The commenters 
stated that fixed cost tiers be established for each State using .05 
GAF increments which would lock in the upper and lower GAF values for 
each cost tier. Under this approach, the fixed cost tiers would not 
change based on updates to the GPCIs; however, a county could be moved 
to a lower (or higher) cost tier without the need to define new tiers 
for the entire state.
(7) Redistribution of Payment
    Many commenters acknowledged that a significant redistribution of 
payments would occur under each alternative locality configuration 
option and requested that we minimize the payment discrepancy between 
urban and rural areas to ensure continued access to services. 
Additionally several commenters stated that any changes to the locality 
configuration should not be unfair to rural practitioners. One 
specialty college noted that any new locality configuration must be 
budget neutral, resulting in a shift of resources from one geographic 
area to another. The commenter expressed concern that the requirement 
for budget neutrality may help physicians who practice in certain 
geographic areas, but will be costly to others. As such, the commenters 
stated that each alternative PFS locality option could create problems 
for medical access in areas where payments are reduced. As a method to 
minimize payment reduction, a few commenters requested that we continue 
the application of the 1.0 work GPCI floor.
    The AMA stated that any proposal to reconfigure PFS payment 
localities should not necessitate budget-neutral payment 
redistributions. The commenter expressed the concern raised by other 
commenters that some localities would receive payment increases under 
some options while other localities would experience significant 
payment reductions to offset these increases. The commenters requested 
that if new locality definitions are proposed, new funding should be 
provided to increase payments in localities that are found to be 
underpaid. The commenters also stated that budget neutral 
redistributions would only exacerbate an already flawed and under-
funded Medicare PFS. The AMA suggested that States with a Statewide 
locality should be given the option of remaining a Statewide locality 
and that CMS should continue its policy of allowing any State the 
option of converting to a Statewide locality at the request of the 
State Medical Association.
    The Iowa Medical Society stated that Medicare PFS payment levels in 
Iowa are among the lowest in the country and that the four alternative 
locality configurations all appear to further reduce payments to State 
physicians. As such, they requested that Iowa remain a Statewide 
locality under any nationwide locality change.
    Because of the redistribution effect of any locality 
reconfiguration, some commenters did not find any of the potential 
alternative locality configurations preferable to the current payment 
locality structure. For example, one physician academy stated that all 
four of the alternative locality scenarios result in disproportionately 
lower GAFs for non-MSA counties. Therefore, the commenter encouraged us 
to maintain the current locality structure until we identify an 
alternative that decreases the number of payment localities and 
supports practitioners in rural and underserved areas. The commenter 
also expressed support for a locality reconfiguration that minimizes 
the number of payment localities; does not exceed the current number of 
89 localities and eliminates geographic payment adjustments (except 
those designed to encourage physicians to practice in underserved 
areas). Furthermore, the Florida Medical Association urged us to work 
with Congress to remove the application of budget neutrality when 
making changes to the PFS payment locality structure. The commenter 
suggested that we use the current GCPI values as a ``floor'' to ensure 
that future updates to the localities will not result in payment 
reductions.
(8) Methodology
    The CMA and a California county medical society commended the 
contractor, Acumen, for the accuracy of its calculations, modeling of 
the options, and observations. However, they recommended a change in 
the iterative methodology used to develop option 2 and option 3. The 
commenters stated that the threshold for removing high cost counties 
from existing localities (option 2) and removing high cost MSAs from 
Statewide localities (option 3) should be equal to or greater than 5 
percent (not just greater than 5 percent) with no rounding up for GAF 
differences below 5 percent. Additionally, with regard to option 2, the 
commenters recommended that counties with identical GAFs to the county 
being considered for a new locality should not be included in the 
calculation of the ``Rest of Locality'' GAF (which is used for 
comparison to the higher cost county).
    Additionally, the commenters objected to the methodology used for 
the ``smoothing'' adjustment. The commenters believe that a new 
locality created by smoothing should not have a significantly lower GAF 
than it would if the county was a single locality. For example, the 
commenters noted that San Diego County (which is currently included in 
the Rest of California locality) has a county-level GAF of 1.056. 
However, when the smoothing adjustment is applied to the current 
locality configuration, the GAF for San Diego is 1.018.
    One research institute questioned why high cost counties were 
separated from existing localities (option 2) and high cost MSAs were 
separated from Statewide localities (option 3); instead of separating 
low cost counties and low cost MSAs. The commenter stated that the CMS 
CBSA methodology is not designed to be sensitive enough to detect 
significant geographic differences in physician compensation and PE. 
The commenter questioned whether compensation and PE costs are 
correlated directly with population density.

[[Page 33537]]

Clarification on Methodology Used To Develop Alternative Locality 
Configurations Discussed in the Interim Report
    With regard to the iterative methodology used for option 2 and 
option 3, the contractor, Acumen, analyzed these alternative locality 
configurations based on its understanding of the MedPAC ideas. A 
threshold of greater than 5 percent was used to separate high cost 
counties from existing localities (option 2) and to separate high cost 
MSAs from Statewide localities (option 3). Additionally, the contractor 
compared just one county (or MSA) at a time against the weighted 
average GAF of all the lower-ranked counties in the Medicare locality. 
Counties with the same GAF were not treated as a group. In ranking 
counties by GAF, the contractor used physician work RVUs to break 
``ties.'' In other words, when two counties in a Medicare locality had 
the same GAF, the county with the higher physician work RVU was ranked 
as if it had the higher GAF. Keeping counties with identical GAFs 
together would be another possible strategy for developing alternative 
PFS payment localities. The high cost counties and MSAs were removed in 
the iterative process to reflect ongoing concerns regarding individual 
high cost counties (usually in ``rest of state'' areas) where the GAF 
is significantly higher than the norm for the locality. Removing low 
cost counties would isolate very low cost areas leading to further 
reductions in PFS payment levels for physicians and practitioners in 
these counties.
    With regard to the sensitivity of the CBSA methodology and whether 
compensation and PE cost are correlated directly to population density; 
the CBSA methodology has three types of areas: MSAs, Metropolitan 
Divisions within MSAs, and non-MSA areas. None of these definitions 
involve population density per se, although MSAs must include core 
areas with populations of 50,000 or greater. Given that the CBSA 
methodology has more regions than the other alternative locality 
configurations, it could potentially draw on more detailed levels of 
data than the other options, and therefore, result in a more precise 
reflection of geographic cost differences.
(9) Suggested Additional Topics for Review
    One commenter stated that the interim locality study report should 
have addressed how a change in payment locality structure might impact 
a physician's choice regarding practice location and Medicare 
beneficiary access to physician services.
    The CMA and a California county medical society stated that the 
interim locality study should have included a discussion of payment 
accuracy under the current locality structure and under each potential 
locality configuration. The commenters stated that a discussion of the 
potential negative impact under a particular option without a 
discussion of the accuracy of payment for each option is misleading. 
Additionally, they suggested adding a discussion of potential methods 
to mitigate payment reductions.
(10) Administrative and Operational Issues
    We received few comments on administrative and operational issues 
related to making changes to the PFS payment locality structure. Some 
commenters stated that a locality revision would impose a minimal 
amount of additional administrative burden. However, the commenters did 
not specify whose administrative burden they were assessing. One 
commenter stated that implementing the CMS CBSA locality configuration 
(option 1) would be a significant administrative burden. Additionally, 
one health care plan explained that many Medicare Advantage Plans are 
based on Medicare fees in specific localities. As such, any fee 
schedule locality revision would be a large scale and costly 
administrative undertaking for managed care plans as well as for 
``traditional'' Medicare.
(11) Underlying Data
    We also received comments on the data used to develop GPCI values. 
Although we appreciate these comments, the focus of the interim 
locality study was not intended to be a review of the underlying data 
sources used to develop GPCI values. As discussed earlier, the interim 
locality study was a review of potential approaches for redefining the 
Medicare PFS payment localities.
Response to Comments
    We would like to thank the public for the many thoughtful comments 
on the interim locality study report entitled, ``Review of Alternative 
GPCI Payment Locality Structures''. As noted by the commenters and 
reflected in the report, significant payment redistribution would occur 
if a nationwide change in the PFS locality configuration were 
undertaken. All four of the potential alternative payment locality 
configurations reviewed in the report would increase the number of 
localities and separate higher cost, typically urban areas from lower 
cost, typically rural ``Rest of State'' areas. In general, payments to 
urban areas would increase while rural areas would see a decrease in 
payment under each of the options studied because they would no longer 
be grouped with higher cost ``urbanized'' areas. We intend to review 
the suggestions made by the commenters and consider the impact of each 
of the potential alternative locality configurations. We will also 
explore whether alternative underlying data sources are available 
nationwide. A final report will be posted to the CMS Web site after 
further review of the studied alternative locality approaches.
    We are not proposing changes in the PFS locality structure at this 
time. As explained in the CY 2009 PFS final rule with comment period, 
in the event we decide to make a specific proposal for changing the 
locality configuration, we would provide extensive opportunities for 
public input (for example, town hall meetings or open door forums, as 
well as opportunities for public comments afforded by the rulemaking 
process).

C. Malpractice Relative Value Units (RVUs)

1. Background
    Section 1848(c) of the Act requires that each service paid under 
the PFS be comprised of three components: work, PE, and malpractice. 
From 1992 to 1999, malpractice RVUs were charge-based, using weighted 
specialty-specific malpractice expense percentages and 1991 average 
allowed charges. Malpractice RVUs for new codes after 1991 were 
extrapolated from similar existing codes or as a percentage of the 
corresponding work RVU. Section 4505(f) of the BBA required us to 
implement resource-based malpractice RVUs for services furnished 
beginning in 2000. Initial implementation of resource-based malpractice 
RVUs occurred in 2000. The statute also requires that we review, and if 
necessary adjust, RVUs no less often than every 5 years. The first 
review and update of resource based malpractice RVUs was addressed in 
the CY 2005 PFS final rule (69 FR 66263). Minor modifications to the 
methodology were addressed in the CY 2006 PFS final rule (70 FR 70153). 
In this current rule, we are proposing to implement the second review 
and update of malpractice RVUs.

[[Page 33538]]

2. Proposed Methodology for the Revision of Resource-Based Malpractice 
RVUs
    The proposed malpractice RVUs were developed by Acumen, LLC 
(Acumen) under contract to us.
    The methodology used in calculating the proposed second review and 
update of resource-based malpractice RVUs largely parallels the process 
used in the CY 2005 update. The calculation requires information on 
malpractice premiums, linked to the physician work conducted by 
different specialties that furnish Medicare services. Because 
malpractice costs vary by State and specialty, the malpractice premium 
information must be weighted geographically and across specialties. 
Accordingly, the proposed malpractice expense RVUs are based upon three 
data sources:
     Actual CY 2006 and CY 2007 malpractice premium data.
     CY 2008 Medicare payment data on allowed services and 
charges.
     CY 2008 Geographic adjustment data for malpractice 
premiums.
    Similar to the previous update of the resource-based malpractice 
expense RVUs, we are proposing to revise the RVUs using specialty-
specific malpractice premium data because they represent the actual 
malpractice expense to the physician. In addition, malpractice premium 
data are widely available through State Departments of Insurance. We 
propose to use actual CY 2006 and CY 2007 malpractice premium data 
because they are the most current data available (CY 2008 malpractice 
premium data were not consistently available during the data collection 
process). Accounting for market shares, three fourths of all included 
rate filings were implemented in CY 2006 and CY 2007. The remaining 
rate filings were implemented in CY 2003 through CY 2005 but still 
effective in CY 2006 and CY 2007. Carriers submit rate filings to their 
State Departments of Insurance listing the premiums and other features 
of their coverage. The rate filings include an effective date, which is 
the date the premiums go into effect. Some States require premium 
changes to be approved before their effective date; others just require 
the rate filings to be submitted. We try to capture at least 2 
companies and at least 50 percent of the market share, starting with 
the largest carriers in a State.
    The primary determinants of malpractice liability costs continue to 
be physician specialty, level of surgical involvement, and the 
physician's malpractice history. We collected malpractice premium data 
from 49 States and the District of Columbia for all physician 
specialties represented by major insurance providers. Rate filings were 
not available through Departments of Insurance in Mississippi or Puerto 
Rico. Premiums were for $1 million/$3 million, mature, claims-made 
policies (policies covering claims made, rather than services furnished 
during the policy term). A $1 million/$3 million liability limit policy 
means that the most that would be paid on any claim is $1 million and 
that the most that the policy would pay for several claims over the 
timeframe of the policy is $3 million. We collected data from 
commercial and physician-owned insurers and from joint underwriting 
associations (JUAs). A JUA is a State government-administered risk 
pooling insurance arrangement in areas where commercial insurers have 
left the market. Adjustments were made to reflect mandatory surcharges 
for patient compensation funds (PCFs) (funds to pay for any claim 
beyond the statutory amount, thereby limiting an individual physician's 
liability in cases of a large suit) in States where PCF participation 
is mandatory. We sought to collect premium data representing at least 
50 percent of physician malpractice premiums paid in each State as 
identified by State Departments of Insurance and by the National 
Association of Insurance Commissioners (NAIC).
    Rather than select the top 20 physician specialties as when the 
malpractice RVU were originally established and updated, we included 
premium information for all physician and surgeon specialties and risk 
classifications available in the collected rate filings. Most insurance 
companies provided crosswalks from insurance services office (ISO) 
codes to named specialties; we matched these crosswalks to CMS 
specialty codes. We also preserved information obtained regarding 
surgery classes, which are categorizations that affect premium rates. 
For example, many insurance companies grouped general practice 
physicians into nonsurgical, minor-surgical and major-surgical classes, 
each with different malpractice premiums. Some companies provided 
additional surgical subclasses; for example, distinguishing general 
practice physicians that conducted obstetric procedures, which further 
impacted malpractice rates. We standardized this information to CMS 
specialty codes.
    We could not identify malpractice premium rates through typical 
malpractice rate filings for some physician specialties, nonphysician 
practitioners (NPPs), and other entities (for example, independent 
diagnostic testing facilities (IDTFs)) paid under the PFS. In the 
absence of available premium data for these specialties and entities, 
we took a number of steps.
    We collected data from one of the largest association program 
insurance brokers and administrators in the United States providing 
malpractice insurance to medical physicists. We incorporated the data 
into the calculation of the proposed update to the malpractice RVUs for 
TC services. (See section II.C.3 of this proposed rule for a discussion 
of this issue.)
    We also crosswalked 13 specialties for which there was not 
significant collected data available (those in less than 35 States' 
malpractice premium rate filings) to similar specialties and risk 
classes. The unassigned specialties and the specialty to which we are 
proposing to assign them are shown in Table 4. The remaining four 
specialties were dropped, meaning they were not included in the 
weighted averages for calculating the malpractice RVUs.

    Note: While we were able to collect data on many more 
specialties on this survey than under the previous one, these four 
specialties were also dropped under the previous version of the 
survey because of a lack of available data. This left 44 
specialties, representing 90 percent of Medicare services, for which 
we used the malpractice premium data to develop risk factors.


                       Table 4--Crosswalk of Specialties to Similar Physician Specialties
----------------------------------------------------------------------------------------------------------------
                                                          Crosswalk
       Spec. code                Specialty name        specialty code             Crosswalk specialty
----------------------------------------------------------------------------------------------------------------
09......................  Interventional Pain                      72  Pain Management.
                           Management.
19......................  Oral Surgery...............              03  Allergy Immunology*.
35......................  Chiropractic...............              03  Allergy Immunology*.
62......................  Psychologist...............              03  Allergy Immunology*.
65......................  Physical Therapist.........              03  Allergy Immunology*.

[[Page 33539]]


67......................  Occupational Therapist.....              03  Allergy Immunology*.
68......................  Clinical Psychologist......              03  Allergy Immunology*.
79......................  Addiction Medicine.........              03  Allergy Immunology*.
85......................  Maxillofacial Surgery......              03  Allergy Immunology*.
86......................  Neuropsychiatry............              26  Psychiatry.
91......................  Surgical Oncology..........              02  General Surgery.
94......................  Interventional Radiology...              30  Diagnostic Radiology.
98......................  Gynecological/Oncology.....              90  Medical Oncology.
99......................  Unknown Physician Specialty              01  General Practice.
----------------------------------------------------------------------------------------------------------------
* Lowest Physician Specialty.

    The methodology presented in this proposed rule conceptually 
follows the specialty-weighted approach used in the CY 2000 and CY 2005 
PFS final rules with comment period (63 FR 59383 and 69 FR 66263, 
respectively) and incorporates the minor modifications discussed in the 
CY 2006 final rule with comment period (70 FR 70153). We revised the 
current specialty-weighted approach to accommodate additional data 
gathered during the malpractice premium data collection. The specialty-
weighted approach bases the malpractice RVUs upon a weighted average of 
the risk factors of all specialties furnishing a given service. This 
approach ensures that all specialties furnishing a given service are 
accounted for in the calculation of the final malpractice RVUs. Our 
proposed methodology is as follows:
    (1) Compute a preliminary national average premium for each 
specialty. Insurance rating area malpractice premiums for each 
specialty were mapped to the county level. The specialty premium for 
each county is then multiplied by the total county RVUs (as defined by 
Medicare claims data), which had been divided by the malpractice GPCI 
applicable to each county to standardize the relative values for 
geographic variations. If the malpractice RVUs were not normalized for 
geographic variation, the locality cost differences (as reflected by 
the GPCIs) would be counted twice. The product of the malpractice 
premiums and standardized RVUs is then summed across counties for each 
specialty. This calculation is then divided by the total RVUs for all 
counties, for each specialty, to yield a national average premium for 
each specialty.
    (2) Determine which risk class(es) to use within each specialty. 
Many specialties had premium rates that differed for major surgery, 
minor surgery, and no surgery. These surgery classes are designed to 
reflect differences in risk of professional liability and the cost of 
malpractice claims if they occur. The same concept applies to 
procedures; some procedures carry greater liability risks. Accordingly, 
we identified major, minor, nonsurgical, and obstetric procedures among 
all Medicare procedures by established indicators (Global Surgery 
Flags). Table 5 shows the surgery class definitions used in the 
proposed methodology.

                                   Table 5--Surgery Classes by Procedure Code
----------------------------------------------------------------------------------------------------------------
              Surgery class                       CPT code range                   Global surgery flag
----------------------------------------------------------------------------------------------------------------
Major Surgery (Maj)......................  10000-69999.................  90 Day.
Minor Surgery (Min)......................  10000-69999.................  All Other.
Obstetrics (OB)..........................  59000-59899.................  N/A.
No Surgery (NS)..........................  All other CPT Codes.........  N/A.
----------------------------------------------------------------------------------------------------------------

    To account for the presence of surgery classes in the malpractice 
premium data and the task of mapping these premiums to procedures, we 
sought to calculate distinct risk factors for major, minor, and 
nonsurgical procedures, as well as a comparable approach for obstetric 
premiums and procedures. However, the availability of data by surgery 
class varied across specialties. In light of the complexity of the 
surgery class data, we evaluated both the frequency with which rate 
class data were reported and a preliminary set of normed national 
average premiums, calculated for all classes reported in the data. 
Because no single approach accurately addressed the risk weights and 
value differences of various specialty/procedure combinations, we 
developed five strategies for handling the surgical classes and 
defining specialties. These strategies are summarized in Table 6.
    (a) Substantial Data for Each Class: For 13 out of 44 specialties, 
we determined that there was sufficient data for each surgical class, 
as well as sufficient differences in rates between classes, to use the 
surgical class data as the basis for risk factors by surgical class.
    (b) Major Surgery Dominates: These 8 surgical specialties typically 
had rate filings that specified major surgery as the predominate rate 
reported. Filings that distinguished minor surgery or nonsurgical were 
relatively rare. For most of these surgical specialties, we did not 
have ``unspecified'' rate filings. When we had ``unspecified'' rate 
filings, the unspecified category was sometimes above and sometimes 
below the major surgery rate. For these cases, we assigned the premium 
for major surgery to all procedures conducted by this specialty. (In 
practice, the major surgery procedures dominate the services actually 
furnished.)
    (c) Little or No Data for Major Surgery: For five other 
specialties, specific premiums for major surgery were uncommon, but 
most States had rate filings that represented minor surgery or 
nonsurgical coverage. These five specialties had unspecified rates that 
were less common than the minor surgery-nonsurgery distinction and the 
nonsurgery rates. Therefore, for these five specialties we assigned the 
minor surgery rate filings for both major surgery and minor surgery 
procedures, and the nonsurgery filings for nonsurgical procedures.

[[Page 33540]]

    (d) Unspecified Dominates: Many malpractice rate filings did not 
specify surgery classes for some specialties; we refer to these 
instances as unspecified malpractice rates. In only two cases, we 
choose the unspecified premium as the premium information to use for 
the specialty. For both of these specialties, fewer than 20 States had 
rate filings that distinguished by surgical classes, while more than 40 
had general rate filings for the specialty.
    (e) Blend All Available: For the last 16 specialties, there was 
wide variation across the State filings in terms of whether or not 
surgical classes were reported and which categories were reported. 
Because there was no clear strategy for these remaining specialties, we 
blended the rate information we collected into one general premium rate 
and applied that rate for all three premiums (major, minor and 
nonsurgical). For these specialties, we developed a weighted average 
``blended'' premium at the national level, according to the percentage 
of physician work RVUs correlated with the surgery classes within each 
specialty.

  Table 6--Summary of Approaches To Defining Premiums by Surgical Class
------------------------------------------------------------------------
               Situation                         Specialty codes
------------------------------------------------------------------------
1. Substantial Data for Each Class (13)  01 (non-OB), 04, 06, 07.
                                         08 (non-OB), 10, 13, 18.
                                         16 (non-OB), 38, 39, 46, 93.
2. Major Surgery Dominates (8).........  02, 14, 20, 24, 28, 33, 77, 78.
3. Little or No Data for Major Surgery   11, 22, 37, 44, 82.
 (5).
4. Unspecified Dominates (2)...........  05, 72.
5. Blend All Available (16)............  03, 25, 26, 29, 30, 34, 36, 40,
                                          48, 66, 71, 81, 83, 84, 90,
                                          92.
------------------------------------------------------------------------

    For rarely-billed Medicare procedures, we did not apply the 5 
percent threshold for inclusion of services or specialties as utilized 
in previous MP RVU updates. Rather, we are proposing to use the risk 
factor of the dominant specialty by services for each procedure for 
which the number of allowed services is less than 100. This approach 
reflects the risk factors of the specialty that most frequently 
furnishes these low volume procedures.
    (3) Calculate a risk factor for each specialty. Differences among 
specialties in malpractice premiums are a direct reflection of the 
malpractice risk associated with the services furnished by a given 
specialty. The relative differences in national average premiums 
between various specialties can be expressed as a specialty risk 
factor. These risk factors are an index calculated by dividing the 
national average premium for each specialty by the national average 
premium for the specialty with the lowest average premium, allergy/
immunology. Table 7 shows the risk factors by specialty and surgery 
class.

                              Table 7--Risk Factors by Specialty and Surgery Class
----------------------------------------------------------------------------------------------------------------
                                                                               Minor-surgical    Major-surgical
        Medicare code                 Medicare name         Non-surgical  RF         RF                RF
----------------------------------------------------------------------------------------------------------------
1............................  General Practice...........              1.50              2.26              3.56
2............................  General Surgery............              5.87              5.87              5.87
3............................  Allergy Immunology.........              1.00              1.00              1.00
4............................  Otolaryngology.............              1.44              2.37              3.55
5............................  Anesthesiology.............              2.22              2.22              2.22
6............................  Cardiology.................              1.87              2.65              6.09
7............................  Dermatology................              1.14              2.06              3.96
8............................  Family Practice............              1.57              2.23              3.79
10...........................  Gastroenterology...........              2.03              2.48              4.09
11...........................  Internal Medicine..........              1.72              2.52              2.52
13...........................  Neurology..................              2.20              2.90             10.28
14...........................  Neurosurgery...............              9.94              9.94              9.94
16...........................  Obstetrics Gynecology......              1.67              2.37              4.64
18...........................  Ophthalmology..............              1.07              1.68              1.90
19...........................  Oral Surgery...............              1.00              1.00              1.00
20...........................  Orthopedic Surgery.........              5.46              5.46              5.46
22...........................  Pathology..................              1.74              2.26              2.26
24...........................  Plastic and Reconstructive               5.51              5.51              5.51
                                Surgery.
25...........................  Physical Medicine and                    1.14              1.14              1.14
                                Rehabilitation.
26...........................  Psychiatry.................              1.22              1.22              1.22
28...........................  Colorectal Surgery.........              3.99              3.99              3.99
29...........................  Pulmonary Disease..........              2.08              2.08              2.08
30...........................  Diagnostic Radiology.......              2.62              2.62              2.62
33...........................  Thoracic Surgery...........              6.51              6.51              6.51
34...........................  Urology....................              2.64              2.64              2.64
35...........................  Chiropractic...............              1.00              1.00              1.00
36...........................  Nuclear Medicine...........              1.55              1.55              1.55
37...........................  Pediatric Medicine.........              1.49              2.41              2.41
38...........................  Geriatric Medicine.........              1.43              2.23              4.22
39...........................  Nephrology.................              1.61              2.27              4.17
40...........................  Hand Surgery...............              3.49              3.49              3.49
44...........................  Infectious Disease.........              2.09              2.52              2.52
46...........................  Endocrinology..............              1.51              2.23              4.46

[[Page 33541]]


48...........................  Podiatry...................              1.98              1.98              1.98
62...........................  Psychologist...............              1.00              1.00              1.00
65...........................  Physical Therapist.........              1.00              1.00              1.00
66...........................  Rheumatology...............              1.56              1.56              1.56
67...........................  Occupational Therapist.....              1.00              1.00              1.00
68...........................  Clinical Psychologist......              1.00              1.00              1.00
71...........................  Registered Dietitian/                    1.54              1.54              1.54
                                Nutrition Professional.
72...........................  Pain Management............              2.21              2.21              2.21
77...........................  Vascular Surgery...........              6.50              6.50              6.50
78...........................  Cardiac Surgery............              6.89              6.89              6.89
79...........................  Addiction Medicine.........              1.00              1.00              1.00
81...........................  Critical Care                            2.15              2.15              2.15
                                (Intensivists).
82...........................  Hematology.................              1.59              2.03              2.03
83...........................  Hematology/Oncology........              1.72              1.72              1.72
84...........................  Preventive Medicine........              1.16              1.16              1.16
85...........................  Maxillofacial Surgery......              1.00              1.00              1.00
86...........................  Neuropsychiatry............              1.22              1.22              1.22
90...........................  Medical Oncology...........              1.76              1.76              1.76
91...........................  Surgical Oncology..........              5.87              5.87              5.87
92...........................  Radiation Oncology.........              2.30              2.30              2.30
93...........................  Emergency Medicine.........              2.29              3.77              4.87
94...........................  Interventional Radiology...              2.62              2.62              2.62
98...........................  Gynecological/Oncology.....              1.76              1.76              1.76
99...........................  Unknown Physician Specialty              1.50              2.26              3.56
----------------------------------------------------------------------------------------------------------------

    One complication in the calculation of specialty risk factors is 
technical component (TC) data. Many procedures are comprised of 
professional components (PC) and TCs. These components are referred to 
as global procedures when billed together. The TC represents the cost 
of equipment, supplies, and technician/staff salaries involved in 
furnishing a procedure, such as the taking of an x-ray by a technician. 
The PC represents the portion of a service that is furnished by a 
physician such as the interpretation of an x-ray by the physician. The 
distinction is important because PCs and TCs have different associated 
risk factors and face different malpractice insurance costs. The 
previous update of the malpractice RVUs did not update the TCs due to 
the lack of available malpractice premium data for entities providing 
TC services. In the past, we were unable to obtain data concerning 
malpractice costs associated with the TC, so we based the malpractice 
RVUs for TC services and the TC portion of global services on 
historical allowed charges.
    We have had ongoing discussions with the AMA RUC and various 
specialty societies about this issue. In the CY 2008 PFS proposed rule 
(72 FR 38143), we noted that the Professional Liability Insurance (PLI) 
workgroup, a subset of the AMA RUC brought to our attention the fact 
that there are approximately 600 services that have TC malpractice RVUs 
that are greater than the PC malpractice RVUs. The PLI workgroup 
requested that we make changes to these malpractice RVUs and suggested 
that it is illogical for the malpractice RVUs for the TC of a service 
to be higher than the malpractice RVUs for the PC.
    We responded that we would like to develop a resource-based 
methodology for the technical portion of these malpractice RVUs; but 
that we did not have data to support such a change. We asked for 
information about whether, and if so, how technicians employed by 
facilities purchase PLI or how their professional liability is covered. 
We also asked for comments on what types of PLI are carried by entities 
that furnish these technical services.
    In the CY 2009 PFS proposed rule (73 FR 38515), we stated that the 
issue of assigning malpractice RVUs for the TC of certain services 
continues to be a source of concern for several physician associations 
and for CMS. We noted that we did not receive a response to our CY 2008 
request for additional data on this issue and that this issue is one of 
importance to CMS. We also stated that the lack of available PLI data 
affects our ability to make a resource-based evaluation of the TC 
malpractice RVUs for these codes. We indicated that as part of our work 
to update the malpractice RVUs in CY 2010, we would instruct our 
contractor to research available data sources for the malpractice costs 
associated with the TC portion of these codes and that we would also 
ask the contractor to look at what is included in general liability 
insurance versus PLI for physicians and other professional staff. We 
also stated that if data sources were available, we would instruct the 
contractor to gather the data so we will be ready to implement revised 
malpractice RVUs for the TC of these codes in conjunction with the 
update of malpractice RVUs for the PCs in CY 2010.
    In the CY 2009 PFS final rule (73 FR 69741), we again responded to 
comments on this issue. We noted that one commenter provided us with 
the name of a company that provides liability insurance to imaging 
facilities. We stated that we planned to share the information with our 
contractor and that if premium data could be identified; it would be 
incorporated into the malpractice RVU update. Our contractor, Acumen 
LLC, contacted the company suggested by the commenter and obtained 
medical physicist malpractice premium data from one of the largest 
association program insurance brokers and administrators in the United 
States providing this type of malpractice insurance. The premium data 
indicate that medical physicists have very low malpractice premiums 
relative to physicians.
    Medical physicists are involved in complex services such as 
Intensity-Modulated Radiation Therapy (IMRT). IMRT is an advanced mode 
of radiotherapy that utilizes computer-controlled x-ray accelerators to 
deliver radiation doses to a malignant tumor. Based on the complexity 
of these services, we believe that medical

[[Page 33542]]

physicists would pay one of the highest malpractice premium rates of 
the entities furnishing TC services and that using their data as a 
proxy (in the absence of actual premium data) to develop malpractice 
RVUs for TC services would be more realistic than our current approach 
for these entities. Moreover, we believe it is unlikely that actual 
malpractice premium rates for these entities would exceed those for 
medical physicists. Therefore, based on this new data collection, we 
are proposing to use the medical physicists' premium data as a proxy 
for the malpractice premiums paid by entities providing TC services. We 
believe that the use of this data will better reflect the level of 
malpractice premiums paid by entities providing TC services than the 
current charge-based malpractice RVUs or crosswalks to the malpractice 
premium data of physician specialties.
    As we have done in the past, we continue to encourage public 
commenters to submit or identify alternative data that we might use for 
the purpose of establishing malpractice RVUs.
    (4) Calculate malpractice RVUs for each code. Resource-based 
malpractice RVUs were calculated for each procedure. The first step was 
to identify the percentage of services furnished by each specialty for 
each respective procedure code. This percentage was then multiplied by 
each respective specialty's risk factor as calculated in Step 3. The 
products for all specialties for the procedure were then added 
together, yielding a specialty-weighted malpractice RVU reflecting the 
weighted malpractice costs across all specialties for that procedure. 
This sum was then multiplied by the procedure's work RVUs to account 
for differences in risk-of-service.
    Certain codes have no physician work RVUs. The overwhelming 
majority of these codes are the TCs of diagnostic tests, such as x-rays 
and cardiac catheterization, which have a distinctly separate TC (the 
taking of an x-ray by a technician) and PC (the interpretation of the 
x-ray by a physician). Examples of other codes with no work RVUs are 
audiology tests and injections. These services are usually furnished by 
NPPs, in this example, audiologists and nurses, respectively. In many 
cases, the NPP or entity furnishing the TC is distinct and separate 
from the physician ordering and interpreting the test. We believe it is 
appropriate for the malpractice RVUs assigned to TCs to be based on the 
malpractice costs of the NPP or entity, not the professional liability 
of the physician.
    Our proposed methodology, however, would result in zero malpractice 
RVUs for codes with no physician work, since we propose the use of 
physician work RVUs to adjust for risk-of-service. We believe that zero 
malpractice RVUs for reasons other than rounding would be inappropriate 
because NPPs and entities such as IDTFs also have malpractice 
liability.
    Note that the earlier discussion above in ``(3) Calculate a risk 
factor for each specialty'' addressed the proposed use of the medical 
physicist premium data to develop a TC risk factor. This TC risk factor 
is used in (3), as noted above, along with the global risk factor to 
calculate a PC risk factor. Once the global and PC risk factors are 
calculated, they are used here in step (4) to calculate the global and 
PC malpractice RVUs. Once we have calculated the global and PC 
malpractice RVUs, we propose to address the lack of work RVUs for TC 
services by setting the TC malpractice RVUs equal to the difference 
between the global malpractice RVUs and PC malpractice RVUs.
    (5) Rescale for budget neutrality. The statute requires that 
changes to fee schedule RVUs be budget neutral. The current resource-
based malpractice RVUs and the proposed resource-based malpractice RVUs 
were constructed using entirely different malpractice premium data. 
Thus, the last step is to adjust for budget neutrality by rescaling the 
proposed malpractice RVUs so that the total proposed resource-based 
malpractice RVUs equal the total current resource-based malpractice 
RVUs.
    We are requesting comments on our proposed methodology for updating 
the malpractice RVUs. We are especially interested in comments on our 
proposed process for revising the malpractice RVUs of the TC of codes 
with no physician work. Additionally, we intend to post the Acumen 
report, ``Interim Report on Malpractice RVUs for the CY 2010 Medicare 
Physician Fee Schedule Proposed Rule'' on the CMS Web site in 
conjunction with publication of this proposed.

D. Medicare Telehealth Services

1. Requests for Adding Services to the List of Medicare Telehealth 
Services
    Section 1834(m)(4)(F) of the Act defines telehealth services as 
professional consultations, office visits, and office psychiatry 
services, and any additional service specified by the Secretary. In 
addition, the statute requires us to establish a process for adding 
services to or deleting services from the list of telehealth services 
on an annual basis.
    In the December 31, 2002 Federal Register (67 FR 79988), we 
established a process for adding services to or deleting services from 
the list of Medicare telehealth services. This process provides the 
public an ongoing opportunity to submit requests for adding services. 
We assign any request to make additions to the list of Medicare 
telehealth services to one of the following categories:
     Category #1: Services that are similar to professional 
consultations, office visits, and office psychiatry services. In 
reviewing these requests, we look for similarities between the 
requested and existing telehealth services for the roles of, and 
interactions among, the beneficiary, the physician (or other 
practitioner) at the distant site and, if necessary, the telepresenter. 
We also look for similarities in the telecommunications system used to 
deliver the proposed service, for example, the use of interactive audio 
and video equipment.
     Category #2: Services that are not similar to the current 
list of telehealth services. Our review of these requests includes an 
assessment of whether the use of a telecommunications system to deliver 
the service produces similar diagnostic findings or therapeutic 
interventions as compared with the face-to-face ``hands on'' delivery 
of the same service. Requesters should submit evidence showing that the 
use of a telecommunications system does not affect the diagnosis or 
treatment plan as compared to a face-to-face delivery of the requested 
service.
    Since establishing the process, we have added the following to the 
list of Medicare telehealth services: Psychiatric diagnostic interview 
examination; ESRD services with two to three visits per month and four 
or more visits per month (although we require at least one visit a 
month to be furnished in-person ``hands on,'' by a physician, clinical 
nurse specialist (CNS), nurse practitioner (NP), or physician assistant 
(PA) to examine the vascular access site); individual medical nutrition 
therapy; neurobehavioral status exam; and follow-up inpatient 
telehealth consultations.
    Requests to add services to the list of Medicare telehealth 
services must be submitted and received no later than December 31 of 
each calendar year to be considered for the next rulemaking cycle. For 
example, requests submitted before the end of CY 2008 are considered 
for the CY 2010 proposed rule. Each request for adding a service to the 
list of Medicare telehealth

[[Page 33543]]

services must include any supporting documentation you wish us to 
consider as we review the request. Because we use the annual PFS 
rulemaking process as a vehicle for making changes to the list of 
Medicare telehealth services, requesters should be advised that any 
information submitted is subject to disclosure for this purpose. For 
more information on submitting a request for an addition to the list of 
Medicare telehealth services, including where to mail these requests, 
visit our Web site at http://www.cms.hhs.gov/telehealth/.
2. Submitted Requests for Addition to the List of Telehealth Services
    We received requests in CY 2008 to add the following services as 
Medicare telehealth services effective for CY 2010: (1) Health and 
behavior assessment and intervention (HBAI) procedures; and (2) nursing 
facility services. In addition, we received a number of requests to add 
services that we considered previously and did not approve as Medicare 
telehealth services in previous PFS rules. These requested services 
include critical care services; initial and subsequent hospital care; 
group medical nutrition therapy; diabetes self-management training; 
speech and language pathology services; and physical and occupational 
therapy services. The following is a discussion of these requests.
a. Health and Behavior Assessment and Intervention (HBAI)
    The American Psychological Association (APA) submitted a request to 
add HBAI services (as described by HCPCS codes 96150 through 96154) to 
the list of approved telehealth services. The APA asks us to evaluate 
and approve HBAI services as Category 1 service because they 
are comparable to the psychotherapy services currently approved for 
telehealth.
CMS Review
    To determine whether to assign a request to Category 1, we 
look for similarities between the service that is being considered for 
addition and the existing telehealth services in the roles of, and 
interactions among, the beneficiary, the physician (or other 
practitioner) at the distant site and, if necessary, the telepresenter.
    Clinical psychologists furnish HBAI services to beneficiaries to 
help them manage or improve their behavior in response to physical 
problems. Elements of HBAI services typically include interviewing, 
observing, and counseling beneficiaries to help them modify their 
behavior. These elements are also common to the office psychiatry 
services currently approved for telehealth. We believe the interaction 
between a practitioner and a beneficiary receiving individual HBAI 
services (as described by HCPCS codes 96150 through 96152) is similar 
to the assessment and counseling elements of the individual office 
psychiatry services currently approved for telehealth. Therefore, we 
are proposing to revise Sec.  410.78 and Sec.  414.65 to include 
individual HBAI services as Medicare telehealth services.
    With regard to group HBAI (as described by HCPCS code 96153) or 
family-with-patient HBAI (as described by HCPCS code 96154), we note 
that no group services are currently approved as Medicare telehealth 
services. Group counseling services have a different interactive 
dynamic between the physician or practitioner and his or her patients 
as compared to individual services. No other group counseling or other 
group services are approved as telehealth services. Since the 
interactive dynamic for group HBAI services is not similar to that for 
individual HBAI services or any other approved telehealth services, we 
do not believe that group HBAI or family-with-patient HBAI services are 
properly considered as Category 1 requests. To be considered 
as a Category 1 request, a service must be similar to the 
current list of Medicare telehealth services. (See 70 FR 45787 and 
70157, and 73 FR 38516 and 69743).
    Since the interactive dynamic between practitioner and patient for 
group HBAI and family-with-patient HBAI is not similar to that for 
office psychiatry services or any other service currently approved for 
telehealth, we believe that group HBAI and family-with-patient HBAI 
must be evaluated as Category 2 services. Because we consider 
group HBAI and family-with-patient HBAI to be Category 2 
services, we need to evaluate whether these are services for which 
telehealth can be an adequate substitute for a face-to-face encounter. 
The requester did not submit evidence suggesting that the use of a 
telecommunications system to deliver these services would produce 
similar diagnostic findings or therapeutic interventions as compared to 
the face-to-face delivery of these services. As such, we do not propose 
to add group HBAI (as described by HCPCS code 96153) or family-with-
patient HBAI (as described by HCPCS code 96154) to the list of approved 
telehealth services.
b. Nursing Facility Services
    In 2005, we received a request to add the following nursing 
facility services to the list of approved telehealth services: Initial 
nursing facility care (as described by HCPCS codes 99304 through 
99306); subsequent nursing facility care (HCPCS codes 99307 through 
99310); nursing facility discharge services (HCPCS codes 99315 and 
99316); and other nursing facility services (HCPCS code 99318). In the 
CY 2007 PFS final rule with comment period, we did not add these 
nursing facility care services to the list of approved telehealth 
services because these procedure codes did not describe services that 
were appropriate to add to the list of available telehealth originating 
sites in CY 2007. At that time, skilled nursing facilities (SNFs) were 
not defined in the statute as originating sites (71 FR 69657).
    However, section 149 of the MIPPA added SNFs as telehealth 
originating sites effective for services furnished on or after January 
1, 2009. In light of this provision, the American Telemedicine 
Association (ATA) urged us to add nursing facility care codes to the 
list of telehealth services for CY 2009, as requested in 2005.
    In the CY 2009 PFS final rule with comment period, we noted that 
section 149 of the MIPPA did not add any services to the list of 
Medicare telehealth services. In the CY 2009 PFS final rule with 
comment period, we also responded to the ATA's comment suggesting that 
we add nursing facility care codes to the list of telehealth services 
for CY 2009, as requested in 2005. In our response, we noted that when 
we received the 2005 request to consider the addition of nursing 
facility care services for telehealth for CY 2007, we did not include a 
full review of these codes in either the CY 2007 PFS proposed rule or 
final rule with comment period since we believed it was not relevant to 
add the nursing facility services codes when the SNFs in which these 
services would be furnished were not eligible originating sites. In the 
CY 2009 PFS final rule with comment period, we responded that we 
believe it would be more appropriate to consider the addition of 
nursing facility care services for telehealth through our existing 
process, including full notice and comment procedures. We committed to 
revisiting the 2005 request to add the nursing facility codes in the CY 
2010 PFS proposed rule, and we noted that we would accept additional 
information in support of the 2005 request if we received the 
information prior to December 31, 2008 (73 FR 69747).
    Subsequent to publication of the CY 2009 PFS final rule with 
comment period, the ATA submitted an amended request to add subsequent 
nursing facility care; nursing facility discharge

[[Page 33544]]

services; and other nursing facility services to the list of approved 
telehealth services. The Center for Telehealth and e-Health Law 
submitted a request to add the same nursing facility services and 
indicated its support of ATA's request. We also received a request from 
the Marshfield Clinic to add the same services requested by the ATA, 
plus the initial nursing facility care services. The requesters drew 
analogies to the evaluation and management (E/M) services currently 
approved for telehealth, and they provided evidence in support of their 
belief that the use of telehealth could be a reasonable surrogate for 
the face-to-face delivery of this type of care.
CMS Review
    The procedure codes included in these requests are used to report 
E/M services furnished onsite to patients in nursing facilities. In the 
context of these codes, ``nursing facility'' describes SNFs, NFs, 
intermediate care facilities, and psychiatric residential treatment 
centers.
    Medicare telehealth services can only be furnished to beneficiaries 
located at an originating site authorized by law. A SNF (as defined in 
section 1819(a) of the Act) is the only type of nursing facility that 
can also be considered an originating site for telehealth services. 
Therefore, our review of these services focuses on the potential impact 
of adding these services when furnished via telehealth to a Medicare 
beneficiary located in a SNF.
Federally-Mandated Visits in Skilled Nursing Facilities
    In describing our assessment, we first describe the service 
requirements of a Medicare SNF stay. In response to concerns about 
inadequate care provided to residents of nursing homes, the Omnibus 
Budget Reconciliation Act of 1987 (OBRA '87) (Pub. L. 100-203) included 
extensive revisions to the requirements for Medicare and Medicaid 
certified nursing homes. These provisions were designed to 
significantly improve the quality of life and the quality of care 
provided to residents of nursing homes, and were a high priority for 
the Department of Health and Human Services.
    Specific requirements for assuring the quality of care that SNFs 
must meet to participate in Medicare are specified in section 1819 of 
the Act. In addition, section 1819(d)(4)(B) of the Act provides that 
``[a] skilled nursing facility must meet such other requirements 
relating to the health, safety, and well-being of residents or relating 
to the physical facilities thereof as the Secretary may find 
necessary.'' The provisions of 42 CFR Part 483 codify the requirements 
set forth in the statute that long term care facilities are obligated 
to meet in order to participate in the Medicare and/or Medicaid 
program.
    Section 1819(b)(6)(A) of the Act requires that the medical care of 
every SNF resident must be provided under the supervision of a 
physician. The requirements contained in Sec.  483.40 include a 
prescribed visit schedule and specify that the physician must perform 
the initial visit personally. Section 483.40(c) requires that the 
resident of a SNF must be seen by a physician at least once every 30 
days for the first 90 days after admission, and at least once every 60 
days thereafter. As we indicated in the preamble to the February 2, 
1989 final rule (54 FR 5341), and again in response to comments in the 
September 26, 1991 final rule (56 FR 48826), the wording of the 
regulation states that the resident ``must be seen'' by the physician 
and requires an actual, face-to-face contact. Except for certain stated 
exceptions, all required physician visits must be made personally by 
the physician. Section 483.40(e)(2) requires that when personal 
performance of a particular task by a physician is specified in the 
regulations, performance of that task cannot be delegated to anyone 
else. Section 483.40(c)(4) requires that the physician must perform the 
initial visit personally, and Sec.  483.40(c)(5), allows the physician 
the option of alternating with a qualified NPP (that is, physician 
assistant, nurse practitioner, or clinical nurse specialist) in making 
the subsequent required visits. These regulations ensure that at least 
a minimal degree of personal contact between physician or qualified NPP 
and resident is maintained, both at the point of admission to the 
facility and periodically during the course of the resident's stay (54 
FR 5342).
    In the CY 2009 PFS final rule with comment period (73 FR 69747), we 
noted that in considering nursing facility care for telehealth, we 
would need to carefully evaluate the use of telehealth for the personal 
visits that are currently required under Sec.  483.40. The OBRA '87 and 
other long-term care legislation enacted since then require a SNF to 
care for its residents ``in such a manner and in such an environment as 
will promote maintenance or enhancement of the quality of life of each 
resident'' as specified in section 1819(b)(1)(A) of the Act. We believe 
that a minimum number of periodic, comprehensive, hands-on examinations 
of a resident by a physician or a qualified NPP are necessary to ensure 
that the resident receives quality care. We believe that the complexity 
of care required by many residents of SNFs warrants at least a minimal 
degree of direct personal contact between physicians or qualified NPPs 
and SNF residents. Therefore, we believe that these Federally-mandated 
visits should be conducted in-person, and not as telehealth services, 
in order to provide direct personal contact between the resident and 
the physician or qualified NPP.
    In the MMA, the Congress recognized the importance of furnishing 
the Federally-mandated visits in person, rather than via telehealth. 
Section 418 of the MMA required the Secretary to submit a Report to 
Congress evaluating the use of telehealth in SNFs. If the Secretary 
determined that it was advisable to permit a SNF to be an originating 
site for telehealth services, the MMA provided the Secretary with the 
authority to expand telehealth originating sites to include SNFs. SNFs 
were permitted to be added as originating sites only if the Secretary 
could establish a mechanism to ensure that telehealth does not serve as 
a substitute for in-person visits furnished by a physician, or for in-
person visits furnished by a physician assistant, nurse practitioner, 
or clinical nurse specialist.
    On November 9, 2007, the Secretary provided to Congress the report 
specified under section 418 of the MMA, entitled, ``Permitting Skilled 
Nursing Facilities to be Originating Telehealth Sites.'' Overall, the 
Report noted that evidence concerning the net impact of allowing SNFs 
to be originating telehealth sites was not conclusive and further 
analysis was needed. With respect to Federally-mandated visits in SNFs, 
the Report stated that the Secretary could use its authority to add 
services to and delete services from the list of Medicare telehealth 
services as a mechanism to ensure that Federally-mandated visits are 
not furnished as a Medicare telehealth service by not adding these 
visits to the lists of Medicare telehealth services.
    In consideration of the history of the OBRA '87, 42 CFR part 483, 
and Congressional concern expressed in section 418 of the MMA, we do 
not propose to add any procedure codes that are used exclusively to 
describe E/M services that fulfill Federal requirements for personal 
visits under Sec.  483.40. We are proposing to revise Sec.  410.78 to 
restrict physicians and practitioners from using telehealth to furnish 
the physician visits required under Sec.  483.40(c).

[[Page 33545]]

    In the following sections, we will separately review the use of 
telehealth for each of the subcategories of nursing facility services 
included in these requests. In these discussions, we will also indicate 
which of these subcategories are used to describe E/M services that 
fulfill Federal requirements for personal visits under Sec.  483.40.
Initial Nursing Facility Care
    The initial nursing facility care procedure codes (as described by 
HCPCS codes 99304 through 99306) are used to report the initial E/M 
visit in a SNF or NF that fulfills Federally-mandated requirements 
under Sec.  483.40(c). For survey and certification requirements, this 
initial visit must occur no later than 30 days after admission. In a 
SNF, a physician must furnish the initial visit.
    One of the requesters noted that once the patient is transferred to 
the SNF, it might be days until a physician can see a resident in-
person. The requester believes a higher quality of care would be 
provided if the initial nursing facility service can be done in an 
expeditious manner--via telehealth--rather than delayed until the 
physician is on site.
    As noted above, we are not proposing to add any procedure codes 
that are used exclusively to describe E/M services that fulfill Federal 
requirements for personal visits under Sec.  483.40. We believe that 
these Federally-mandated visits should be conducted in-person because 
this will ensure at least a minimal degree of direct personal contact 
between physicians or qualified NPPs and residents. Further, we believe 
it is particularly important that the Federally-mandated initial visit 
should be conducted in-person because this will ensure that the 
physician can comprehensively assess the resident's condition upon 
admission to the SNF through a thorough hands-on examination. We 
believe that even if the initial visit is delayed for a few days, it is 
necessary for the resident of a SNF to have a face-to-face visit with 
the physician who is developing a plan of care. Under section 
1819(b)(2) of the Act, a SNF must provide services to attain or 
maintain the highest practicable physical, mental, and psychosocial 
well-being of each resident. We believe that furnishing the initial 
visit in a face-to-face encounter, and not via telehealth, is necessary 
to assure quality care. As such, we are not proposing to add the 
initial nursing facility care services (as described by HCPCS codes 
99304 through 99306) to the list of approved telehealth services.
Subsequent Nursing Facility Care
    The subsequent nursing facility care procedure codes (as described 
by HCPCS codes 99307 through 99310) are used to report either a 
Federally-mandated periodic visit under Sec.  483.40(c), or any E/M 
visit, prior to and after the initial physician visit, that is 
reasonable and medically necessary to meet the medical needs of the 
individual resident.
    The long-term care regulations at Sec.  483.40 require periodic 
physician visits for residents of SNFs (and NFs) at least once every 30 
days for the first 90 days after admission and at least once every 60 
days thereafter. After the initial visit, Federally-mandated periodic 
visits in SNFs may, at the option of the physician, alternate between 
personal visits by the physician and visits by a qualified NPP (who is 
under the supervision of a physician, and meets the other requirements 
specified at Sec.  483.40(e)). As noted above, we are not proposing to 
allow the use of telehealth to furnish these Federally-mandated 
personal visits. We believe that these Federally-mandated periodic 
visits should be conducted in-person because this will ensure at least 
a minimal degree of direct personal contact between physicians or 
qualified NPPs and residents. Under section 1819(b)(2) of the Act, a 
SNF must provide services to attain or maintain the highest practicable 
physical, mental, and psychosocial well-being of each resident. We 
believe that furnishing the periodic personal visits in face-to-face 
encounters, and not via telehealth, is necessary to assure quality 
care.
    We considered the possibility of approving subsequent nursing 
facility care for telehealth with specific limitations, for example, 
approving subsequent nursing facility care for telehealth only when the 
codes are used for medically necessary E/M visits that are in addition 
to Federally mandated periodic personal visits. In past years, we did 
not add hospital E/M visits to the list of Medicare approved telehealth 
services because of our concern regarding the use of telehealth for the 
ongoing E/M of a high-acuity hospital inpatient. (See 69 FR 47511, 69 
FR 66276, 72 FR 38144, 72 FR 66250, 73 FR 38517, and 73 FR 69745.) Many 
residents of SNFs require medically complex care, and we have similar 
concerns about allowing physicians or NPPs to furnish E/M visits via 
telehealth to residents of SNFs.
    Because the complexity of care required by many residents of SNFs 
may be significantly greater than the complexity of care generally 
associated with patients receiving the office visits approved for 
telehealth, we do not consider E/M visits furnished to residents of 
SNFs similar to the office visits on the current list of Medicare 
telehealth services. Therefore, we believe the use of subsequent 
nursing facility care for medically necessary E/M visits that are in 
addition to Federally mandated periodic personal visits must be 
evaluated as a Category 2 service.
    Because we consider subsequent nursing facility care to be a 
Category 2 request, we evaluate whether these are services for 
which telehealth can be an adequate substitute for a face-to-face 
encounter. The requesters submitted supporting documentation intended 
to suggest that the use of telehealth could be a reasonable surrogate 
for the face-to-face delivery of this type of care.
    One study assessed the impact of videoconferencing (as opposed to 
communication by telephone without video) on nighttime, on-call medical 
decision-making in the nursing home. The comparison of 
videoconferencing with telephonic communication of information by 
nurses does not provide a comparative analysis demonstrating that E/M 
visits furnished via telehealth to residents of SNFs is equivalent to 
the face-to-face delivery of such services. As such, this study was not 
relevant to this review.
    Another study assessed the value of a monitoring system in reducing 
falls and injuries in non-acute late-evening and nighttime situations 
in a nursing home setting. The monitoring system described in this 
study was comprised of sensors to alert caregivers via a silent pager 
when a high-risk resident exits his or her bed, bedroom, or bathroom. 
This allows caregivers to aid the resident and potentially reduce 
falls. The technologies utilized in this study do not correspond with 
our definitions of telehealth as specified in Sec.  410.78. In 
addition, this type of resident monitoring is performed typically by 
nursing staff and is not an E/M visit. As such, this study was not 
relevant to this review.
    A third study presented the savings achieved through avoiding 
transport to emergency departments and physicians' offices by 
furnishing visits via telehealth to residents in nursing facilities. 
The study did not provide any comparative analysis of the services 
furnished via telehealth with those furnished in person.
    A fourth study evaluated the impact of telemedicine as a decision 
aid for residents of long-term care SNFs with chronic wounds. The 
patients selected for this study were alert and

[[Page 33546]]

intellectually interactive. The study concluded that furnishing a 
telehealth consultation prior to a face-to-face consultation increased 
the level of patient comfort with care-related decisions made during 
the face-to-face consultation. The control group did not receive an 
equivalent intermediate consultation face-to-face that could be 
compared to the services furnished to the test group. We acknowledge 
the study's findings that the intermediate telehealth consultation was 
a useful decision aid, but we do not consider this a comparative 
analysis between delivery of the same type of care via telehealth 
versus face-to-face.
    We received a pilot study evaluating the usefulness of E/M services 
furnished via telehealth for making routine medical decisions in the 
nursing home. The nursing home residents were evaluated over 
videoconferencing and then evaluated immediately afterward by the same 
clinician in person. On a scale of 1 to 5 (1 being the least ill), the 
clinicians assessed the illness level of these residents at 3 or below, 
with the illness level for over 65 percent of the encounters assessed 
at ``1.'' Videoconferencing without a face-to-face examination was 
sufficient for making medical decisions in most cases studied in this 
pilot, although face-to-face examinations were preferred. Clinicians 
generated orders in 30 percent of these paired encounters, with a 
predominance of orders generated after, rather than before, the face-
to-face examination. The study also noted that even when nursing home 
residents were alert, they had limited participation in the 
telemedicine interactions and were not as involved in making informed 
medical decisions with their clinicians, compared to face-to-face 
encounters. The study suggests that remote examination by video might 
serve as a substitute for some routine visits, if interspersed with 
face-to-face examinations. The study concluded that videoconferencing 
is feasible for making routine medical decisions in the nursing home.
    We appreciate the comparative analysis provided by this study. 
However, we note that this study focused on the usefulness of 
telehealth for routine decision-making in the nursing home, and the 
reported illness levels of the residents in these sample encounters was 
relatively low to moderate. We do not consider these findings 
persuasive that telehealth can, more generally, be an adequate 
substitute for the face-to-face delivery of E/M visits to residents of 
SNFs who might require more medically complex care.
    We considered the possibility of approving the use of telehealth to 
furnish E/M visits to residents of SNFs who do not require medically 
complex care or approving subsequent nursing facility care for 
telehealth only for medically necessary E/M visits with straightforward 
or low complexity medical decision-making (as described by HCPCS codes 
99307 and 99308). Although this last pilot study concluded that 
videoconferencing is feasible for making routine medical decisions in 
the nursing home, we are concerned with the study's finding that 
residents with low to moderate levels of reported illness had limited 
participation in the telemedicine interactions and less involvement in 
making informed medical decisions with their clinicians, compared to 
face-to-face encounters. Under section 1819(c)(1)(A) of the Act, a SNF 
must protect and promote the rights of each resident, including the 
right to be fully informed in advance of any changes in care or 
treatment that may affect the resident's well-being, and (except with 
respect to a resident adjudged incompetent) to participate in planning 
care and treatment or changes in care or treatment. Under Sec.  
483.10(b)(3), a resident has the right to be fully informed in language 
that he or she can understand of his or her total health status, 
including but not limited to his or her medical condition. If the use 
of telehealth does not elicit from residents with low to moderate 
reported illness adequate participation in making informed medical 
decisions with their clinicians when compared to face-to-face 
encounters, we believe that telehealth is not an adequate substitute 
for the face-to-face delivery of E/M visits to any residents of SNFs.
    After reviewing these studies, we do not have sufficient 
comparative analysis or other compelling evidence to demonstrate that 
furnishing E/M visits via telehealth to residents of SNFs is an 
adequate substitute for the face-to-face encounter between the 
practitioner and the resident, especially in cases where the resident 
requires medically complex care. Therefore, we are not proposing to add 
subsequent nursing facility care services (as described by HCPCS codes 
99307 through 99310) to the list of approved telehealth services.
Nursing Facility Discharge Day Management
    The nursing facility discharge day management codes (as described 
by HCPCS codes 99315 and 99316) are used to report an E/M visit that 
prepares a resident for discharge from a nursing facility. We note that 
there is no Medicare Part B requirement to furnish and bill an E/M 
visit in preparation for a resident's discharge from a SNF. However, if 
a physician or qualified NPP bills a Nursing Facility Discharge 
Services code, we believe that a face-to-face encounter will better 
insure that the resident is prepared for discharge, as we do not have 
evidence that nursing facility discharge services via telehealth is 
adequately equivalent to face-to-face provision. As such, we are not 
proposing to add the nursing facility discharge day management services 
(as described by HCPCS codes 99315 and 99316) to the list of approved 
telehealth services.
Other Nursing Facility Service
    In 2006, CPT added a procedure code for Other Nursing Facility 
Service (CPT code 99318) to describe an annual nursing facility 
assessment. An annual assessment is not one of the required visits 
under the long-term care regulations at Sec.  483.40. For Medicare 
purposes, this code can be used in lieu of a Subsequent Nursing 
Facility Care code to report a Federally-mandated periodic personal 
visit furnished under Sec.  483.40(c). An annual assessment visit 
billed using CPT code 99318 does not represent a distinct benefit 
service for Medicare Part B physician services, and it cannot be billed 
in addition to the required number of Federally-mandated periodic 
personal visits. Under Medicare Part B, we cover this procedure code if 
the visit fully meets the CPT code 99318 requirements for an annual 
nursing facility assessment and if such an annual assessment falls on 
the 60-day mandated visit cycle. We are not proposing to add the other 
nursing facility care services (as described by HCPCS code 99318) to 
the list of approved telehealth services because this code is payable 
by Medicare only if the visit is substituted for a Federally-mandated 
visit under Sec.  483.40(c). As explained above, we believe all of the 
Federally-mandated periodic visits must be conducted in person.
Follow-up Inpatient Consultations
    Prior to 2006, follow-up inpatient consultations (as described by 
CPT codes 99261 through 99263) were approved telehealth services. In 
2006, the CPT Editorial Panel of the American Medical Association (AMA) 
deleted the codes for follow-up inpatient consultations. In the 
hospital setting, the AMA advised practitioners to bill for services 
that would previously have been billed as follow-up inpatient 
consultations using the procedure codes for subsequent hospital care 
(as described by CPT codes 99231 through 99233). In the nursing 
facility setting,

[[Page 33547]]

the AMA advised practitioners to bill for these services using the 
procedure codes for subsequent nursing facility care (as described by 
CPT codes 99307 through 99310).
    In the CY 2008 PFS proposed rule (72 FR 38144) and subsequent final 
rule with comment period (72 FR 66250), we discussed a request from the 
ATA to add subsequent hospital care to the list of approved telehealth 
services. Because there was no method for practitioners to bill for 
follow-up consultations delivered via telehealth to hospital 
inpatients, the ATA requested that we add the subsequent hospital care 
codes to the list of Medicare approved telehealth services. We 
expressed our concern that subsequent hospital care codes describe a 
broader range of services than follow-up consultations, including some 
services that may not be appropriate to be furnished via telehealth. We 
committed to continue evaluating the issues.
    In the CY 2009 PFS proposed rule (73 FR 38517), we proposed to 
create a new series of HCPCS codes for follow-up inpatient telehealth 
consultations. In the CY 2009 PFS final rule with comment period (73 FR 
69745), we finalized our proposal to create follow-up inpatient 
telehealth consultation codes (as described by HCPCS codes G0406 
through G0408) and added these G-codes to the list of Medicare 
telehealth services. These HCPCS codes are limited to the range of 
services included in the scope of the previous CPT codes for follow-up 
inpatient consultations, and the descriptions limit the use of such 
services for telehealth. (See the CMS Internet-Only Medicare Benefit 
Policy Manual, Pub. 100-02, Chapter 15, Section 270.2.1 and the 
Medicare Claims Processing Manual, Pub. 100-04, Chapter 12, Section 
190.3.1 for the current definition of follow-up inpatient telehealth 
consultations.)
    We note that if the former codes for follow-up consultations (as 
described by CPT codes 99261 through 99263) still existed, these 
procedure codes would also be available to practitioners to submit 
claims to their Medicare contractors for payment of follow-up 
consultations provided via telehealth to patients located in SNFs. 
Although we did not receive a public request to add follow-up inpatient 
consultations for patients in SNFs to the list of approved Medicare 
telehealth services, we recognize a similar need to establish a method 
for practitioners to furnish and bill for follow-up consultations 
delivered via telehealth to patients in SNFs.
    We considered the possibility of approving subsequent nursing 
facility care for telehealth with specific limitations, for example, 
approving subsequent nursing facility care for telehealth only when the 
codes are used for follow-up consultations. However, as discussed 
above, we do not believe it would be appropriate for E/M visits to be 
furnished via telehealth to treat residents of SNFs requiring medically 
complex care. We are concerned that it could be difficult to implement 
sufficient controls and monitoring to ensure that the use of the 
subsequent nursing facility care codes for telehealth is limited to the 
delivery of services that were formerly described as follow-up 
inpatient consultations.
    We considered creating new G-codes to enable practitioners to bill 
for the services that were formerly described as follow-up inpatient 
telehealth consultations when furnished to residents of SNFs. We 
examined the feasibility of creating such codes to parallel the 
subsequent nursing facility care services, which are the codes 
currently used to bill these follow-up consultations in a face-to-face 
encounter. We found that the elements of the four levels of subsequent 
nursing facility care did not correspond to the three levels of the 
deleted CPT codes previously used for follow-up inpatient 
consultations. We believe that it would be administratively simpler to 
utilize the three existing codes for follow-up inpatient telehealth 
consultations rather than add additional G-codes. The use of the same 
``follow-up inpatient telehealth consultation'' G-codes for services 
furnished in both hospital inpatient and SNF settings would also 
correspond to the use of the previous CPT codes for services furnished 
to hospital inpatients and residents of SNFs.
    For CY 2010, we are proposing to revise Sec.  410.78 to specify 
that the G-codes for follow-up inpatient telehealth consultations (as 
described by HCPCS codes G0406 through G0408) include follow-up 
telehealth consultations furnished to beneficiaries in hospitals and 
SNFs. The HCPCS codes will clearly designate these services as follow-
up consultations provided via telehealth, and not subsequent nursing 
facility care used for E/M visits. Utilization of these codes for 
patients in SNFs will facilitate payment for these services, as well as 
enable us to monitor whether the codes are used appropriately.
    As described in the CMS Internet-Only Medicare Benefit Policy 
Manual, Pub. 100-02, Chapter 15, Section 270.2.1 and the Medicare 
Claims Processing Manual, Pub. 100-04, Chapter 12, Section 190.3.1, 
follow-up inpatient telehealth consultations include monitoring 
progress, recommending management modifications, or advising on a new 
plan of care in response to changes in the patient's status or no 
changes on the consulted health issue. Counseling and coordination of 
care with other providers or agencies is included as well, consistent 
with the nature of the problem(s) and the patient's needs. The 
physician or practitioner who furnishes the inpatient follow-up 
consultation via telehealth cannot be the physician of record or the 
attending physician, and the follow-up inpatient consultation would be 
distinct from the follow-up care provided by a physician of record or 
the attending physician. If a physician consultant has initiated 
treatment at an initial consultation and participates thereafter in the 
patient's ongoing care management, such care would not be included in 
the definition of a follow-up inpatient consultation and is not 
appropriate for delivery via telehealth.
    Consistent with our policy for follow-up telehealth consultations 
furnished to hospital inpatients, in order to bill and receive payment 
for these services, physicians and practitioners must submit the 
appropriate HCPCS procedure code for follow-up inpatient telehealth 
consultations along with the ``GT'' modifier (``via interactive audio 
and video telecommunications system''). By coding and billing the 
``GT'' modifier with the follow-up inpatient telehealth consultation 
codes, the distant site physician or practitioner certifies that the 
beneficiary was present at an eligible originating site when the 
telehealth service was furnished. (See the CMS Internet-Only Medicare 
Claims Processing Manual, Pub. 100-04, Chapter 12, Section 190.6.1 for 
instructions for submission of interactive telehealth claims.)
    In the case of Federal telemedicine demonstration programs 
conducted in Alaska or Hawaii, store and forward technologies may be 
used as a substitute for an interactive telecommunications system. 
Covered store and forward telehealth services are billed with the 
``GQ'' modifier, ``via asynchronous telecommunications system.'' By 
using the ``GQ'' modifier, the distant site physician or practitioner 
certifies that the asynchronous medical file was collected and 
transmitted to him or her at the distant site from a Federal 
telemedicine demonstration project conducted in Alaska or Hawaii. (See 
the CMS Internet-Only Medicare Claims Processing Manual, Pub. 100-04, 
Chapter 12, Section 190.6.2 for instructions for submission of 
telehealth store and forward claims.)

[[Page 33548]]

c. Critical Care Services
    In the CY 2009 PFS proposed rule (73 FR 38517), we reviewed a 
request submitted by the University of Pittsburgh Medical Center (UPMC) 
to add critical care services (as described by HCPCS codes 99291 and 
99292) to the list of approved telehealth services. UPMC drew analogies 
to the E/M consultation services currently approved for telehealth and 
described how it uses telehealth to give stroke patients timely access 
to consultative input from highly specialized physicians who are not 
available to furnish services face-to-face.
    In the CY 2009 PFS final rule with comment period (73 FR 69744), we 
did not add critical care services to the list of approved telehealth 
services. This request was not considered as a category 1 
request because, as we stated, we believe that remote critical care 
services are a different service than the telehealth delivery of 
critical care (as described by HCPCS codes 99291 and 99292). We stated 
that we had no evidence suggesting that the use of telehealth could be 
a reasonable surrogate for the face-to-face delivery of this type of 
care, and we did not add critical care services to the list of Medicare 
approved telehealth services. We noted that this decision does not 
preclude physicians from providing telehealth consultations to 
critically ill patients.
    Following publication of the CY 2009 PFS final rule with comment 
period, Philips Healthcare, the maker of a remote critical care system, 
submitted an expanded request to add critical care services to the list 
of Medicare approved telehealth services. The Philips Healthcare 
request stated that critical care services can be approved as a 
Category 1 service based on their similarity to the inpatient 
consultation services currently approved for telehealth. The requester 
noted that many of the components of critical care are similar to a 
high-level inpatient consultation service, which is currently approved 
for telehealth. Common components include obtaining a patient history, 
conducting an examination, and engaging in complex medical decision-
making for patients who may be severely ill. Because we classified 
critical care as a Category 2 service last year, Philips also 
submitted evidence to support its belief that the use of telehealth 
could be a reasonable surrogate for the face-to-face delivery of this 
type of care.
CMS Review
    To determine whether to assign a request to Category 1, we 
look for similarities between the service that is being considered for 
addition and existing telehealth services for the roles of, and 
interactions among, the beneficiary, the physician (or other 
practitioner) at the distant site and, if necessary, the telepresenter. 
In this case, we look for such similarities between critical care and 
inpatient consultations and other similar services on the current list 
of approved Medicare telehealth services. Critical care (as described 
by HCPCS codes 99291 and 99292) is the direct delivery by a physician 
of medical care for a critically ill or critically injured patient. It 
involves high complexity decision-making to assess, manipulate, and 
support vital system function(s) to treat single or multiple vital 
organ system failure and/or to prevent further life-threatening 
deterioration of the patient's condition. Within the current standards 
of practice, we believe critical care services require the physical 
presence of the physician rendering the critical care services. We also 
note that a number of hands-on interventions (for example, gastric 
intubation and vascular access procedures), when furnished on the day a 
physician bills for critical care, are included in the critical care 
service and are not reported separately. Inpatient consultations 
generally do not include hands-on interventions. Because we believe 
that critical care services (as described by HCPCS codes 99291 and 
99292) require the physical presence of a physician who is available to 
furnish any necessary hands-on interventions, we do not consider 
critical care services similar to any services on the current list of 
Medicare telehealth services. Therefore, we believe critical care must 
be evaluated as a Category 2 service.
    In order to evaluate critical care services as a Category 
2 service, we need to determine whether these are services for 
which telehealth can be an adequate substitute for a face-to-face 
encounter. In CPT 2009, the AMA defined remote critical care services 
tracking codes (codes 0188T through 0189T) with cross-references to 
critical care services (HCPCS codes 99291 through 99292). CPT directs 
that only one physician may report either critical care services or 
remote critical care services for the same period. The requester cites 
this as evidence that the AMA considers the two services equivalent, 
and that critical care should be approved as a Category 2 
service. We do not consider the CPT coding guidance persuasive evidence 
that remote critical care is the telehealth delivery of critical care, 
as defined by HCPCS codes 99291 and 99292. We believe that if the AMA 
valued the two services equally, they would not have created separate 
tracking codes for remote critical care services.
    As we noted in the CY 2009 PFS final rule with comment period, 
consistent with the AMA's creation of tracking codes, we believe that 
remote critical care services are different from the telehealth 
delivery of critical care services (as described by HCPCS codes 99291 
and 99292). Category III CPT codes track utilization of a service, 
facilitating data collection on, and assessment of, new services and 
procedures. We believe that the data collected for these tracking codes 
will help provide useful information on how to best categorize and 
value remote critical care services in the future.
    The requester also submitted studies which conclude that remote 
critical care services furnished by intensivists improve mortality 
rates, decrease length of stay, reduce per patient costs, and improve 
compliance with best practices, thereby improving patient outcomes. 
These studies are similar to the ones we received and reviewed from the 
CY 2009 PFS proposed rule. We maintain that remote critical care 
services are not the telehealth delivery of critical care services (as 
described by HCPCS codes 99291 and 99292). Therefore, we do not find 
the new studies submitted with the CY 2010 request persuasive that 
telehealth can be an adequate substitute for the face-to-face delivery 
of critical care services (as described by HCPCS codes 99291 and 
99292).
    We continue to believe that remote critical care services are 
different services than the telehealth delivery of critical care (as 
described by HCPCS codes 99291 and 99292). As such, we are not 
proposing to add critical care services (as described by HCPCS codes 
99291 and 99292) to the list of approved telehealth services. We 
reiterate that our decision not to add critical care services to the 
list of approved telehealth services does not preclude physicians from 
furnishing telehealth consultations to critically ill patients.
d. Other Requests
    We received a number of requests to add services that we reviewed 
and did not approve in previous PFS Rules. The following are brief 
summaries and references to previous discussions regarding our 
decisions not to add these procedure codes to the list of Medicare 
approved telehealth services. As explained further below, we are not 
reconsidering these previous decisions.

[[Page 33549]]

Initial and Subsequent Hospital Care
    We received a request to add initial hospital care (as described by 
HCPCS codes 99221 through 99223) and subsequent hospital care (as 
described by HCPCS codes 99231 through 99233) to the list of approved 
telehealth services. In response to previous requests, we did not add 
initial or subsequent hospital care to the list of approved telehealth 
services because of our concern regarding the use of telehealth for the 
ongoing E/M of a high-acuity hospital inpatient. (See 69 FR 47510 and 
66276, 72 FR 38144 and 66250, and 73 FR 38517 and 69745.) We did not 
receive any new information with this request that would alter our 
previous decisions. Therefore, we are not proposing to add initial 
hospital care (as described by HCPCS codes 99221 through 99223) or 
subsequent hospital care (as described by HCPCS codes 99231 through 
99233) to the list of approved telehealth services.
Group Medical Nutrition Therapy Services
    We received a request to add group medical nutrition therapy (MNT) 
services (as described by HCPCS codes G0271 and 97804) to the list of 
approved telehealth services. In response to a previous request, we did 
not add group MNT to the list of approved telehealth services because 
we believe that group services are not appropriately delivered through 
telehealth. (See 70 FR 45787 and 70157.) We did not receive any new 
information with this request that would alter our previous decision. 
Therefore, we are not proposing to add group MNT (as described by HCPCS 
codes G0271 and 97804) to the list of approved telehealth services.
Diabetes Self-Management Training (DSMT)
    We received a request to add diabetes self-management training 
(DSMT) (as described by HCPCS codes G0108 and G0109) to the list of 
approved telehealth services. In response to previous requests, we did 
not add DSMT to the list of approved telehealth services because of the 
statutory requirement that DSMT include teaching beneficiaries to self-
administer injectable drugs. Furthermore, DSMT is often performed in 
group settings and we believe that group services are not appropriately 
delivered through telehealth. (See 70 FR 45787 and 70157, and 73 FR 
38516 and 69743.) We did not receive any new information with this 
request that would alter our previous decisions. Therefore, we are not 
proposing to add DSMT (as described by HCPCS codes G0108 and G0109) to 
the list of approved telehealth services.
Speech and Language Pathology Services
    We received a request to add various speech and language pathology 
services to the list of approved telehealth services. Speech-language 
pathologists are not permitted under current law to furnish and receive 
payment for Medicare telehealth services. Therefore, we do not propose 
to add any speech and language pathology services to the list of 
Medicare telehealth services. (For further discussion, see 69 FR 47512 
and 66276, and 71 FR 48995 and 69657.)
Physical and Occupational Therapy Services
    We received a request to add various physical and occupational 
therapy services to the list of approved telehealth services. Physical 
and occupational therapists are not permitted under current law to 
furnish and receive payment for Medicare telehealth services. 
Therefore, we are not proposing to add any physical and occupational 
therapy services to the list of approved telehealth services. (For 
further discussion, see 71 FR 48995 and 69657.)

E. Coding Issues

1. Canalith Repositioning
    In 2008, the CPT Editorial Panel created a new code for canalith 
repositioning (CRP). This procedure is a treatment for vertigo which 
involves therapeutic maneuvering of the patient's body and head in 
order to use the force of gravity to redeposit the calcium crystal 
debris in the semicircular canal system.
    In the CY 2009 PFS final rule with comment period (73 FR 69896), 
new CPT code 95992, Canalith repositioning procedure(s) (eg, Epley 
maneuver, Semont maneuver), per day, was assigned the bundled status 
indicator (B). We explained that this procedure previously was billed 
as part of an evaluation and management (E/M) service or under a number 
of CPT codes, including CPT code 97112, Therapeutic procedure, one or 
more areas, each 15 minutes; neuromuscular reeducation of movement, 
balance, coordination, kinesthetic sense, posture, and/or 
proprioception for sitting and/or standing activities. We also 
explained that because neurologists and therapists are the predominant 
providers of this service to Medicare patients (each at 22 percent), it 
was assigned as a ``sometimes therapy'' service under the therapy code 
abstract file.
    We received comments on this issue from the American Physical 
Therapy Association (APTA), as well as other organizations expressing 
opposition to our decision to bundle the new code. Commenters stated 
that they believe that our decision to bundle CPT code 95992 is flawed 
since physical therapists are unable to bill E/M services. The 
commenter also stated that therapists would be precluded from using 
another code for billing for this service because CPT correct coding 
instructions require that the provider/supplier select the procedure 
that most accurately defines the service provided. Commenters also 
expressed concern that this could impact beneficiary access to this 
service.
    Based upon the commenters' feedback, we realized that we had failed 
to address how therapists would bill for the service since they cannot 
bill E/M services. In order to address this situation so that access to 
this service would not be impacted, we included language in a change 
request (CR) (the quarterly update CR for April) and also released a 
MedLearn article informing PTs to continue using one of the more 
generally defined ``always therapy'' CPT codes (97112) as a temporary 
measure. See http://www.cms.hhs.gov/transmittals/downloads/R1691CP.pdf 
and http://www.cms.hhs.gov/MLNMattersArticles/downloads/MM6397.pdf.
    In response to the concerns raised and upon additional review of 
this issue for CY 2010, we are proposing to change the status indicator 
from B (Bundled) to I (Invalid). We propose that physicians would 
continue to be paid for CRP as a part of an E/M service. Physical 
therapists would continue to use one of the more generally defined 
``always therapy'' CPT codes (97112). We believe that this will enable 
beneficiaries to continue to receive this service while at the same 
time it will address our concerns about the potential for duplicate 
billing for this service to the extent that this service is paid as a 
part of an E/M service. As a result of this proposal, CPT code 95992 
would be removed as a ``sometimes'' therapy code from the therapy code 
list.
2. Payment for an Initial Preventive Physical Examination (IPPE)
    Beginning January 1, 2010, we propose to increase the payment for 
an initial preventive physical examination (IPPE) furnished face-to-
face with the patient and billed with HCPCS code G0402, Initial 
preventive physical examination; face-to-face visit, services

[[Page 33550]]

limited to new beneficiary during the first 12 months of Medicare 
enrollment. The IPPE service includes a broad array of components and 
focuses on primary care, health promotion, and disease prevention.
    Section 101(b) of the MIPPA changed the IPPE benefit by adding to 
the IPPE visit the measurement of an individual's body mass index and, 
upon an individual's consent, end-of-life planning. Section 101(b) of 
the MIPPA also removed the screening electrocardiogram (EKG) as a 
mandatory service of the IPPE.
    In order to implement this MIPPA provision, in the CY 2009 PFS 
final rule with comment period (73 FR 69870), we created HCPCS code 
G0402 as a new HCPCS code and retained, on an interim basis, the work 
RVUs of 1.34 assigned to HCPCS code G0344, the code that was previously 
used to bill for the IPPE. While we did not believe the revisions to 
the IPPE required by MIPPA impacted the work RVUs associated with this 
service, we solicited public comments on this issue, as well as 
suggested valuations of this service to reflect resources involved in 
furnishing the service.
    We received comments from several medical groups representing 
primary care physicians and geriatricians, as well as comments from the 
American Medical Association concerning this issue. The commenters 
stated that the IPPE service was undervalued prior to the addition of 
components by the MIPPA. Commenters also stated that the current level 
of work RVUs would discourage delivery of appropriate end-of-life 
planning with the beneficiary. One commenter suggested the work 
associated with HCPCS code G0402 for the IPPE, as described in statute, 
is captured in existing CPT code 99387, Preventive Medicine Service, 
new patient, Initial comprehensive preventive medicine, 65 years and 
older. (This code is not paid under the PFS.) The work RVUs for this 
CPT code are 2.06.
    Based on a review of the comments and upon further evaluation of 
the component services of the IPPE, we believe the services, in the 
context of work and intensity, contained in HCPCS code G0402 are most 
equivalent to those services contained in CPT code 99204, Evaluation 
and management new patient, office or other outpatient visit, and 
propose increasing the work RVUs for HCPCS code G0402 to 2.30 effective 
for services furnished beginning on January 1, 2010.
3. Audiology Codes: Policy Clarification of Existing CPT Codes
    In the CY 2009 PFS final rule with comment period (73 FR 69890), we 
noted that the RUC reviewed and recommended work RVUs for 6 audiology 
codes with which we agreed (that is, CPT codes 92620, 92621, 92625, 
92626, 92627, and 92640). We also noted that in the Medicare program, 
audiology services are provided under the diagnostic test benefit and 
that some of the work descriptors for these services include 
``counseling,'' ``potential for remediation,'' and ``establishment of 
interventional goals.'' We noted that we do not believe these aspects 
fit within the diagnostic test benefit, and therefore, we solicited 
comment on this issue.
    Since audiology services fall under the diagnostic test benefit, 
aspects of services that are therapeutic or management activities are 
not payable to audiologists. This distinction is of particular 
importance since CPT codes 92620, 92621, 92626, 92627, and 92640 are 
``timed'' codes, that is, these codes are billed based on the actual 
time spent furnishing the service. In response to our request, the 
society that represents speech language pathologists, audiologists, and 
speech and language scientists, provided the following comments.
    Comment: With respect to the term ``counseling,'' the commenter 
stated that ``counseling'' as used in the intraservice work description 
for CPT code 92640, Diagnostic analysis with programming of auditory 
brainstem implant, per hour, is used in the context of informational 
rather than personal counseling. In this instance the counseling 
provides information and guidance to the patient on what to expect 
relative to the service (application of the electrical stimulation). 
This counseling is an integral part of the diagnostic procedure and not 
a means of providing therapy or active treatment.
    Response: We appreciate the comments related to counseling by the 
specialty society, but are not persuaded that counseling is an integral 
part of a diagnostic test. Although we understand that test results are 
sometimes conveyed to the patient during or at the conclusion of a 
diagnostic test, counseling the patient about how to compensate for a 
hearing loss is part of a therapeutic service. As such, therapeutic 
and/or management of disease process counseling are not part of the 
diagnostic test benefit and time attributable to such activities is not 
payable to audiologists under the Medicare program.
    Comment: With respect to the term ``potential for remediation,'' 
which is found as part of the intraservice work descriptor for CPT code 
92625, Assessment of tinnitus (includes pitch, loudness matching, and 
masking), the commenter states that the procedure evaluates the 
frequency and intensity characteristics of the perceived tinnitus in 
addition to measuring how the tinnitus responds to a masking noise. The 
response to masking noise is diagnostic information that audiologists 
and physicians refer to as the ``potential for remediation.'' This 
assessment is thus a part of a complete diagnostic workup and is not a 
treatment or therapeutic service.
    Response: The intraservice work for this service includes informing 
the patient of the outcome of the evaluation and the potential for 
remediation. As noted above, although we understand that test results 
are sometimes conveyed to the patient during or at the conclusion of a 
diagnostic test, discussing therapeutic options and/or providing 
therapy or management based on test results are not part of a 
diagnostic test. Discussing the potential for remediation does not 
appear to be part of a diagnostic test. While this service can involve 
a small amount of nondiagnostic work, CPT code 92625 is not a timed 
code and the bulk of the work described in the code appears to be 
diagnostic in nature.
    Comment: With respect to the term ``establishment of interventional 
goals,'' this phrase is found in the intraservice work description of 
CPT code 92626, Evaluation of auditory rehabilitation status; first 
hour. The commenter states that this procedure focuses on diagnostic 
information relative to the patient's ability to use residual hearing 
with a hearing aid, a cochlear implant, or with no electronic device. 
The intervention goals may take a variety of forms, such as the 
following: Meeting audiological criteria for cochlear implantation; a 
recommendation to continue use of hearing aids (that is, not a cochlear 
implant candidate); and the need to coordinate with a speech-language 
pathologist for auditory training. This provides the physician with a 
complete diagnostic evaluation of the patient's residual hearing 
status. There is no element of therapy or treatment associated with 
this service.
    Response: Diagnostic testing usually does not involve the 
establishment of interventional goals. The test report usually contains 
test findings and may suggest additional tests. While we appreciate the 
comments of the specialty society, we are not persuaded that 
establishing interventional goals is

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part of a diagnostic test under Medicare. The establishment of 
interventional goals is clearly a function of therapeutic management. 
As such, establishment of goals is not part of the diagnostic test 
benefit and time attributable to such activity is not payable to an 
audiologist under the Medicare program.
    We appreciate the comments we received on this issue. We want to 
emphasize that therapeutic and/or management activities associated with 
these audiology tests are not payable to audiologists because of the 
benefit category under which these tests are covered. We may also issue 
instructions to contractors to monitor these services to prevent 
inappropriate payments.
4. Consultation Services
a. Background
    The current physician visit and consultation codes were developed 
by the American Medical Association (AMA) Current Procedural 
Terminology (CPT) Editorial Panel in November 1990. A consultation 
service is an evaluation and management (E/M) service furnished to 
evaluate and possibly treat a patient's problem(s). It can involve an 
opinion, advice, recommendation, suggestion, direction, or counsel from 
a physician or qualified NPP at the request of another physician or 
appropriate source. (See the Internet-Only Medicare Claims Processing 
Manual, Pub. 100-04, chapter 12, Sec.  30.6.10A for more information.) 
A consultation service must be documented and a written report given to 
the requesting professional. Currently, consultation services are 
predominantly billed by specialty physicians. Primary care physicians 
infrequently furnish these services.
    The required documentation supports the accuracy and medical 
necessity of a consultation service that is requested and provided. 
Medicare pays for a consultation service when the request and report 
are documented as a consultation service, regardless of whether 
treatment is initiated during the consultation evaluation service. (See 
the Internet-Only Medicare Claims Processing Manual, Pub. 100-04, 
chapter 12, Sec.  30.6.10B.) A consultation request between 
professionals may be done orally by telephone, face-to-face, or by 
written prescription brought from one professional to another by the 
patient. The request must be documented in the medical record.
    In the Physician Fee Schedule Final Rule issued June 5, 1991, (56 
FR 25828) we stated that the agency's goal for the development of the 
new visit and consultation codes was that they meet two criteria: (1) 
They should be used reliably and consistently by all physicians and 
carriers; that is, the same service should be coded the same way by 
different physicians; and (2) they should be defined in a way that 
enables us to properly crosswalk the new codes to the relative values 
for the Harvard vignettes so valid RVUs for work are assigned to the 
new codes.
    Based on requests from the physician community to clarify our 
consultation payment policy and to provide consultation examples, we 
convened an internal workgroup of medical officers within CMS (then 
called the Health Care Financing Administration, or HCFA) and revised 
the payment policy instructions in August 1999 in the Medicare Claims 
Processing Manual (at Sec.  30.6.10 as cited above). We provided 
examples of consultation services and examples of clinical scenarios 
that did not satisfy Medicare criteria for consultation services. 
Without explicit instructions for every possible clinical scenario 
outlined in national policy instructions or in AMA coding definitions 
or coding instructions, the local policy interpretations by Medicare 
contractors were not universally equivalent or acceptable to the 
physician community and resulted in denials in different localities. 
Some Medicare contractors would consider a consultation service with 
treatment to be an initial visit rather than a consultation thus 
resulting in a denial for the billed consultation. We clarified in the 
1999 revision that Medicare would pay for a consultation whether 
treatment was initiated at the consultation visit or not. The physician 
community has stated that terms such as referral, transfer and 
consultation, used interchangeably by physicians in clinical settings, 
confuse the actual meaning of a consultation service and that 
interpretation of these words varies greatly among members of that 
community as some label a transfer as a referral and others label a 
consultation as a referral. Although we clarified the terms referral 
and consultation in the 1999 revision, there was disagreement with our 
policy by physicians in the health care community and by AMA CPT staff. 
We provided our documentation guidance so physicians would be in 
compliance with our payment policy. The consultation definition in the 
AMA CPT simply stated that the consultant's opinion or other 
information must be communicated to the requesting physician.
    Additional manual revisions in both January and September 2001 (at 
Sec.  30.6.10 as cited above) clarified that NPPs can both request and 
furnish consultation services within their scope of practice and 
licensure requirements. We continued to explain our documentation 
requirements to the physician community through our Medicare 
contractors and in our discussions with the AMA CPT staff. Under our 
current policy and in the AMA CPT definition, a consultation service 
must have a request from another physician or other professional and be 
followed by a report to the requesting professional. The AMA CPT 
definition does not state the request must be written in the requesting 
physician's medical record. However, we require the request to be 
documented in the requesting physician's plan of care in the medical 
record as a condition for Medicare payment. The E/M documentation 
guidelines which apply to all E/M visits or consultations (http://
www.cms.hhs.gov/MLNEdWebGuide/25_EMDOC.asp) clearly state that when 
referrals are made, consultations are requested, or advice is sought, 
the medical record should indicate to whom and where the referral or 
consultation is made or from whom the advice is requested. Our Medicare 
contractors are responsible for reviewing and paying consultation 
claims when submitted. When there is a question that triggers a review 
of a consultation service, our Medicare contractors will look at both 
the requesting physician's medical record (where the request should be 
noted) and the consultant's medical record where the consultation is 
reported and at the report generated for the requesting physician. 
Medicare contractors do not look for evidence of documentation on every 
claim, only when there is a concern raised during random sampling or 
during a specific audit performed by a contractor. The AMA CPT coding 
manual, which is not a payment manual, does not specify these 
requirements, and, therefore, as we understand it, many physicians do 
not agree with the CMS policy.
    In March 2006, the Office of the Inspector General (OIG) published 
a report entitled, ``Consultations in Medicare: Coding and 
Reimbursement'' (OEI-09-02-00030). The purpose of the report was to 
assess whether Medicare's payments for consultation services were 
appropriate. While the OIG study was being conducted, we continued our 
ongoing discussions with the AMA CPT staff for potential changes to the 
consultation definition and guidance in CPT. The findings in the OIG 
report (based on claims paid by Medicare in 2001) indicated that 
Medicare allowed

[[Page 33552]]

approximately $1.1 billion more in 2001 than it should have for 
services that were billed as consultations. Approximately 75 percent of 
services paid as consultations did not meet all applicable program 
requirements (per the Medicare instructions) resulting in improper 
payments. The majority of these errors (47 percent of the claims 
reviewed) were billed as the wrong type or level of consultation. The 
second most frequent error was for services that did not meet the 
definition of a consultation (19 percent of the claims reviewed). The 
third category of improperly paid claims was a lack of appropriate 
documentation (9 percent of the claims reviewed). The OIG recommended 
that CMS, through our Medicare contractors, should educate physicians 
and other health care practitioners about Medicare criteria and proper 
billing for all types and levels of consultations with emphasis on the 
highest levels and follow-up inpatient consultation services.
    We agreed with the OIG findings that additional education would 
help physicians understand the differences in the requirements for a 
consultation service from those for other E/M services. With each 
additional revision from 1999 until the OIG study began, we continually 
educated physicians through the guidance provided by our Medicare 
contractors. However, there remained discrepancies with unclear and 
ambiguous terms and instructions in the AMA CPT consultation coding 
definition, transfer of care and documentation, and the feedback from 
the physician community indicated they disagreed with Medicare 
guidance.
    Prior to the official publication of the OIG report, we issued a 
Medlearn Matters article, effective January 2006, to educate the 
physician community about requirements and proper billing for all types 
and levels of consultation services as requested by the OIG in their 
report. The Medlearn Matters article reflected the manual changes we 
made in 2006 and the AMA CPT coding changes as noted below.
    Our consultation policy revisions continued as a work-in-progress 
over several years as disagreements were raised by the physician 
community. We continued to work with AMA CPT coding staff in an attempt 
to have improved guidance for consultation services in the CPT coding 
definition. In looking at physician claims data (for example, the low 
usage of confirmatory consultation services) and in response to 
concerns from the physician community regarding how to correctly use 
the follow-up consultation codes, the AMA CPT Editorial Panel chose to 
delete some of the consultation codes for 2006. The Follow-Up Inpatient 
Consultation codes (CPT codes 99261 through 99263) and the Confirmatory 
Consultation codes (CPT codes 99271 through 99275) were deleted. During 
our ongoing discussions, the AMA CPT staff, maintained that physicians 
did not fully understand the use of these codes and historically 
submitted them inappropriately for payment as was reflected in the OIG 
study.
    We issued a manual revision in the Medicare Claims Processing 
Manual (at Sec.  30.6.10 as cited above) simultaneously with the 
publication of AMA CPT 2006 coding changes removing the follow-up 
consultation codes, and instructed physicians to use the existing 
subsequent hospital care code(s) and subsequent nursing facility care 
codes for visits following a consultation service. The confirmatory 
consultation codes (which were typically used for second opinions) were 
also removed and we instructed physicians to use the existing E/M codes 
for a second opinion service. We further clarified the documentation 
requirements by making it easier to document a request for a 
consultation service from another physician and to submit a 
consultation report to the requesting professional. Again, physicians 
stated that a consultant has no control over what a requesting or 
referring physician writes in a medical record, and that they should 
not be penalized for the behavior of others. However, our consultation 
policy instructions apply to all physicians, whether they request a 
consultation or furnish a consultation. As noted above, documentation 
by both the requesting physician and the physician who furnishes the 
consultation, is required under the E/M documentation guidelines. The 
E/M documentation guidelines have been in use since 1995. In our 
discussions with the AMA CPT staff and physician groups, and national 
physician open door conference calls, we have emphasized that the 
requesting physician medical record is not reviewed unless there is a 
specific audit or random sampling performed. The physician furnishing 
the consultation service should document in the medical record from 
whom a request is received.
    We continue to hear from the AMA and from specific national 
physician specialty representatives that physicians are dissatisfied 
with Medicare documentation requirements and guidance that distinguish 
a consultation service from other E/M services such as transfer of 
care. CPT has not clarified transfer of care. Therefore, many physician 
groups disagree with our requirements for documentation of transfer of 
care. Interpretation differs from one physician to another as to 
whether transfer of care should be reported as an initial E/M service 
or as a consultation service.
    Despite our efforts, the physician community disagrees with 
Medicare interpretation and guidance for documentation of transfer of 
care and consultation. The existing consultation coding definition in 
the AMA CPT definition remains ambiguous and confusing for certain 
clinical scenarios and without a clear definition of transfer of care. 
The CPT consultation codes are used by physicians and qualified NPPs to 
identify their services for Medicare payment. There is an absence of 
any guidance in the AMA CPT consultation coding definition that 
distinguishes a transfer of care service (when a new patient visit is 
billed) from a consultation service (when a consultation service is 
billed). Medicare does provide guidance although there is disagreement 
with our policy from AMA CPT staff and some members of the physician 
community. Because of the disparity between AMA coding guidance and 
Medicare policy some physicians state they have difficulty in choosing 
the appropriate code to bill. The payment for both inpatient 
consultation and office/outpatient consultation services is higher than 
for initial hospital care and new patient office/outpatient visits. 
However, the associated physician work is clinically similar. Many 
physicians contend that there is more work involved with a new patient 
visit than a consultation service because of the post work involvement 
with a new patient. The payment for a consultation service has been set 
higher than for initial visits because a written report must be made to 
the requesting professional. However, all medically necessary Medicare 
services require documentation in some form in a patient's medical 
record. Over the past several years, some physicians have asked CMS to 
recognize the provision of the consultation report via a different form 
of communication in lieu of a written letter report to the requesting 
physician so as to lessen any paperwork burden on physicians. We have 
eased the consultation reporting requirements by lessening the required 
level of formality and permitting the report to be made in any written 
form of communication, (including submission of a copy of the 
evaluation examination taken directly from the medical record and 
submitted without a letter format) as long as the identity of the 
physician who furnished the consultation is

[[Page 33553]]

evident. Although preparation and submission of the consultant's report 
is no longer the major defining aspect of consultation services, the 
higher payment has remained. (See the Internet-Only Medicare Claims 
Processing Manual, Pub. 100-04, chapter 12, Sec.  30.6.10 F.)
    Both AMA CPT coding rules and Medicare Part B payment policy have 
always required that there is only one admitting physician of record 
for a particular patient in the hospital or nursing facility setting. 
(AMA CPT 2009, Hospital Inpatient Services, Initial Hospital Care, 
p.12) This physician has been the only one permitted to bill the 
initial hospital care codes or initial nursing facility codes. All 
other physicians must bill either the subsequent hospital care codes, 
subsequent nursing facility care codes or consultation codes. (See the 
Internet-Only Medicare Claims Processing Manual, Pub. 100-04, chapter 
12, Sec.  30.6.9.1 G.)
    Beginning January 1, 2008, we ceased to recognize office/outpatient 
consultation CPT codes for payment of hospital outpatient visits (72 FR 
66790 through 66795). Instead, we instructed hospitals to bill a new or 
established patient visit CPT code, as appropriate to the particular 
patient, for all hospital outpatient visits. Regardless of all of our 
efforts to educate physicians on Medicare guidance for documentation, 
transfer of care, and consultation policy, disagreement in the 
physician community prevails.
b. Proposal
    Beginning January 1, 2010, we propose to budget neutrally eliminate 
the use of all consultation codes (inpatient and office/outpatient 
codes for various places of service except for telehealth consultation 
G-codes) by increasing the work RVUs for new and established office 
visits, increasing the work RVUs for initial hospital and initial 
nursing facility visits, and incorporating the increased use of these 
visits into our PE and malpractice RVU calculations.
    We note that section 1834(m) of the Act includes ``professional 
consultations'' (including the initial inpatient consultation codes 
``as subsequently modified by the Secretary'') in the definition of 
telehealth services. We recognize that consultations furnished via 
telehealth can facilitate the provision of certain services and/or 
medical expertise that might not otherwise be available to a patient 
located at an originating site. Therefore, for CY 2010, if we finalize 
our proposed policy to eliminate consultations from the PFS, then we 
propose to create HCPCS codes specific to the telehealth delivery of 
initial inpatient consultations. The purpose of these codes would be 
solely to preserve the ability for practitioners to provide and bill 
for initial inpatient consultations delivered via telehealth. These 
codes are intended for use by practitioners when furnishing services 
that meet Medicare requirements relating to coverage and payment for 
telehealth services. Practitioners would use these codes to submit 
claims to their Medicare contractors for payment of initial inpatient 
consultations provided via telehealth. The new HCPCS codes would be 
limited to the range of services included in the scope of the CPT codes 
for initial inpatient consultations, and the descriptions would be 
modified to limit the use of such services for telehealth. The HCPCS 
codes would clearly designate these as initial inpatient consultations 
provided via telehealth, and not initial hospital care or initial 
nursing facility care used for inpatient visits. Utilization of these 
codes would allow us to provide payment for these services, as well as 
enable us to monitor whether the codes are used appropriately.
    If we create HCPCS G-codes specific to the telehealth delivery of 
initial inpatient consultations, then we also propose to crosswalk the 
RVUs for these services from the RVUs for initial hospital care (as 
described by CPT codes 99221 through 99223). We believe this is 
appropriate because a physician or practitioner furnishing a telehealth 
service is paid an amount equal to the amount that would have been paid 
if the service had been furnished without the use of a 
telecommunication system. Since physicians and practitioners furnishing 
initial inpatient consultations in a face-to-face encounter to hospital 
inpatients must continue to utilize initial hospital care codes (as 
described by CPT codes 99221 through 99223), we believe it is 
appropriate to set the RVUs for the proposed inpatient telehealth 
consultation G-codes at the same level as for the initial hospital care 
codes.
    We considered creating separate G-codes to enable practitioners to 
bill initial inpatient telehealth consultations when furnished to 
residents of SNFs and crosswalking the RVUs to initial nursing facility 
care (as described by CPT codes 99304 through 99306). For the sake of 
administrative simplicity, if we create HCPCS G-codes specific to the 
telehealth delivery of initial inpatient consultations, they will be 
defined in Sec.  410.78 and in our manuals as appropriate for use to 
deliver care to beneficiaries in hospitals or skilled nursing 
facilities. If we adopt this proposal, then we will make corresponding 
changes to our regulations at Sec.  410.78 and Sec.  414.65. In 
addition, we will add the definition of these codes to the CMS 
Internet-Only Medicare Benefit Policy Manual, Pub. 100-02, Chapter 15, 
Section 270 and the Medicare Claims Processing Manual, Pub. 100-04, 
Chapter 12, Section 190.
    Outside the context of telehealth services, physicians will bill an 
initial hospital care or initial nursing facility care code for their 
first visit during a patient's admission to the hospital or nursing 
facility in lieu of the consultation codes these physicians may have 
previously reported. The initial visit in a skilled nursing facility 
and nursing facility must be furnished by a physician except as 
otherwise permitted as specified in Sec.  483.40(c)(4). In the nursing 
facility setting, an NPP who is enrolled in the Medicare program, and 
who is not employed by the facility, may perform the initial visit when 
the State law permits this. (See this exception in the Internet-Only 
Medicare Claims Processing Manual, Pub. 100-04, chapter 12, Sec.  
30.6.13A). An NPP, who is enrolled in the Medicare program is permitted 
to report the initial hospital care visit or new patient office visit, 
as appropriate, under current Medicare policy. Because of an existing 
CPT coding rule and current Medicare payment policy regarding the 
admitting physician, we will create a modifier to identify the 
admitting physician of record for hospital inpatient and nursing 
facility admissions. For operational purposes, this modifier will 
distinguish the admitting physician of record who oversees the 
patient's care from other physicians who may be furnishing specialty 
care. The admitting physician of record will be required to append the 
specific modifier to the initial hospital care or initial nursing 
facility care code which will identify him or her as the admitting 
physician of record who is overseeing the patient's care. Subsequent 
care visits by all physicians and qualified NPPs will be reported as 
subsequent hospital care codes and subsequent nursing facility care 
codes.
    We believe the rationale for a differential payment for a 
consultation service is no longer supported because documentation 
requirements are now similar across all E/M services. To be consistent 
with OPPS policy, as noted above, we will pay only new and established 
office or other clinic visits under the PFS.
    This proposed change would be implemented in a budget neutral

[[Page 33554]]

manner, meaning it would not increase or decrease PFS expenditures. We 
would make this change budget neutral for the work RVUs by increasing 
the work RVUs for new and established office visits by approximately 6 
percent to reflect the elimination of the office consultation codes and 
the work RVUs for initial hospital and facility visits by approximately 
2 percent to reflect the elimination of the facility consultation 
codes. We have crosswalked the utilization for the office consultation 
codes into the office visits and the utilization of the hospital and 
facility consultation codes into the initial hospital and facility 
visits. This change would be made budget neutral in the PE and 
malpractice RVU methodologies through the use of the new work RVUs and 
the crosswalked utilization. The PE and malpractice RVU methodologies 
are described elsewhere in this proposed rule.
    We are soliciting comments on the proposal, described more fully 
above, to eliminate payment for all consultation services codes under 
the PFS and to allow all physicians to bill, in lieu of a consultation 
service code, an initial hospital care visit or initial nursing 
facility care visit for their first visit during a patient's admission 
to the hospital or nursing facility. Additionally, we are soliciting 
comments on the proposal to create HCPCS G-codes to identify the 
telehealth delivery of initial inpatient consultations.

F. Potentially Misvalued Services Under the Physician Fee Schedule

1. Valuing Services Under the Physician Fee Schedule
    The American Medical Association's (AMA) Relative Value System 
Update Committee (RUC) provides recommendations to CMS for the 
valuation of new and revised codes, as well as codes identified as 
misvalued. On an ongoing basis, the AMA RUC's Practice Expense (PE) 
Subcommittee reviews direct PE (clinical staff, medical supplies, 
medical equipment) for individual services and examines the many broad 
and methodological issues relating to the development of PE relative 
value units (RVUs).
    To address concerns expressed by stakeholders with regard to the 
process we use to price services paid under the PFS, the AMA RUC 
created the Five-Year Review Identification Workgroup. As we stated in 
the CY 2009 PFS proposed rule (73 FR 38582), the workgroup identified 
some potentially misvalued codes through several vehicles, namely, 
identifying codes with site of service anomalies, high intra-service 
work per unit time (IWPUT), and services with high volume growth. The 
IWPUT is derived from components of the ``building-block'' approach, as 
described in the CY 2007 PFS proposed rule (71 FR 37172), and is used 
as a measure of service intensity. There were 204 services identified 
as misvalued last year and we plan to continue working with the AMA RUC 
to identify additional codes that are potentially misvalued. In the CY 
2009 PFS proposed rule (73 FR 38586), we also listed approaches for the 
AMA RUC to utilize, namely, the review of the fastest growing procedure 
codes, review of Harvard-valued codes, and review of PE RVUs.
    We plan to address the AMA RUC's recommendations from the February 
and April 2009 meetings for codes with site of service anomalies in the 
CY 2010 PFS final rule with comment period in a manner consistent with 
the way we address other AMA RUC recommendations. Specifically, we 
complete our own review of the AMA RUC recommendations; and then in the 
PFS final rule with comment period, we describe the AMA RUC's 
recommendations, indicate whether or not we accept them, and provide a 
rationale for our decision. The values for these services will be 
published as interim values for the next calendar year.
    We believe that there are additional steps we can take to help 
address the issue of potentially misvalued services. In the CY 2009 PFS 
proposed rule, we identified approaches to address this issue including 
reviewing services often billed together and the possibility of 
expanding the multiple procedure payment reduction (MPPR) to additional 
nonsurgical procedures and the update of high cost supplies.
2. High Cost Supplies
    In the CY 2009 PFS proposed rule (73 FR 38582), we proposed a 
process to update the prices associated with high cost supplies over 
$150 every 2 years. We explained that we would need the cooperation of 
the medical community in obtaining typical prices in the marketplace. 
We also outlined examples of acceptable documentation. Although we 
received many thoughtful comments on the proposed process for updating 
high-cost supplies, as stated in the CY 2009 PFS final rule with 
comment period (73 FR 69882), we are continuing to examine alternatives 
on the best way to obtain accurate pricing information and will propose 
a revised process in future rulemaking.
3. Review of Services Often Billed Together and the Possibility of 
Expanding the Multiple Procedure Payment Reduction (MPPR) to Additional 
Nonsurgical Procedures
    In the CY 2009 PFS final rule with comment period (73 FR 69882), we 
stated that we plan to perform a data analysis of nonsurgical CPT codes 
that are often billed together. This would identify whether there are 
inequities in PFS payments that are a result of variations between 
services in the comprehensiveness of the codes used to report the 
services, or in the payment policies applied to each (for example, 
global surgery and MPPRs). The rationale for the MPPR is that certain 
clinical labor activities, supplies, and equipment are not performed or 
furnished twice when multiple procedures are performed. We stated that 
we would consider developing a proposal either to bundle additional 
services or expand application of the MPPR to additional procedures.
    Several specialty groups noted that the AMA RUC has already taken 
action to identify frequently occurring code pairs. The commenters 
support the AMA RUC's recommendation that CMS analyze data to identify 
nonsurgical CPT codes that are billed together 90 to 95 percent of the 
time. Additionally, the Medicare Payment Advisory Committee (MedPAC) 
requested that we consider duplicative physician work, as well as PE, 
in any expansion of the MPPR.
    We plan to analyze codes furnished together more than 75 percent of 
the time, excluding E/M codes. We will analyze both physician work and 
PE inputs. If duplications are found, we will consider whether an MPPR 
or bundling of services is most appropriate. Any proposed changes will 
be made through rulemaking and be subject to public comment at a later 
date.
4. AMA RUC Review of Potentially Misvalued Codes
a. Site of Service Anomalies
    The AMA RUC created the Five-Year Review Identification Workgroup 
to respond to concerns expressed by the MedPAC, the Congress, and other 
stakeholders regarding accurate pricing under the PFS. The workgroup 
identified potentially misvalued codes through several vehicles. For 
example, the workgroup focused on codes for which there have been 
shifts in the site of service (site of service anomalies), codes with a 
high intra-service work per unit of time (IWPUT), and codes that were 
high volume. There were 204 potentially misvalued services

[[Page 33555]]

identified in 2008 (see the CY 2009 PFS final rule with comment period 
(73 FR 69883)). These codes were reviewed by the AMA RUC and 
recommendations were submitted to CMS in 2008.
    In the CY 2009 PFS final rule with comment period (73 FR 69883), we 
noted that although we would accept the AMA RUC valuation for these 
site of service anomaly codes for 2009, we recognized that many of them 
included deletion or modification of certain inputs such as hospital 
days, office visits, service times, and discharge day management 
services in the global period. We also indicated that we had concerns 
about the methodology used by the AMA RUC to review these services 
which may have resulted in removal of hospital days and deletion or 
reallocation of office visits without extraction of the associated RVUs 
from the valuation of the code. However, we stated that we believed the 
AMA RUC-recommended valuations were still a better representation of 
the resources used to furnish these services than the current ones. We 
also stated that we would continue to examine these codes and would 
consider whether it would be appropriate to propose additional changes 
in future rulemaking.
    After further review of these codes, we believe it would be 
appropriate to propose further changes to several of the codes where 
the valuation has been adjusted to reflect changes in the site of 
service. Specifically, we are proposing changes to codes for which the 
AMA RUC review process deleted or reallocated pre-service and post 
service times, hospital days, office visits, and discharge day 
management services without the extraction of the associated RVUs.
    We believe the AMA RUC-recommended values do not reflect the 
extraction of the RVUs associated with deleted or reallocated pre-
service and post-service times, hospital days, office visits, and 
discharge day management services. Therefore, we have recalculated the 
work RVUs based upon the AMA RUC-recommended inputs (that is, changes 
in pre-service and post-service times and associated E/M services). The 
proposed work RVUs for each CPT code shown in Table 8 were recalculated 
using the pre-AMA RUC review work RVUs as a starting point, and 
adjusting them for the addition or extraction of pre-service and post-
service times, inpatient hospital days, discharge day management 
services and outpatient visits as recommended by the AMA RUC. We used 
the following methodology:
    1. For each CPT code noted in Table 8, we separated out each 
component (that is, pre-service time, intra-service time, post-service 
time, inpatient hospital day, discharge day management services, and 
outpatient visits) that comprised the entire work RVUs for the service.
    2. We calculated the incremental difference between the pre-service 
and post-service time from before and after the AMA RUC review, and 
multiplied that difference by an IWPUT intensity factor of 0.0224, 
which is a constant in the IWPUT equation. For example, if the pre-
service time prior to the AMA RUC review was 75 minutes and, following 
its review, the AMA RUC recommended an increase in pre-service time to 
85 minutes, we multiplied the difference (10 minutes) by 0.0224 to 
determine the RVUs associated with the increase in pre-service time, 
and then added that number of RVUs to the pre-AMA RUC evaluation work 
RVU.
    3. We then added or removed the work RVUs associated with the 
extraction or reallocation of each inpatient hospital day, outpatient 
visit or discharge day management service as appropriate. For example, 
assume that prior to the AMA RUC review a code was assigned:
     1 inpatient hospital day (currently billed using CPT code 
99231 and assigned 0.76 work RVUs);
     1 discharge day management service (currently billed using 
CPT code 99238 and assigned 1.28 work RVUs); and
     2 outpatient visits (currently billed using 99212 and 
assigned 0.45 work RVUs).
    After the AMA RUC review, the inpatient hospital day and discharge 
day management service were removed. To account for the removal of 
these services, we would have subtracted 0.76 work RVUs (represents the 
removal of the work RVUs for 1 inpatient hospital day) and 1.28 work 
RVUs (represents the removal of the work RVUs for 1 discharge day 
management service) from the pre-AMA RUC review work RVUs in order to 
develop the CMS proposed work RVUs.
    The methodology discussed above was used for each code noted in 
Table 8 and reflects the extraction of the RVUs associated with deleted 
or reallocated hospital days, office visits, discharge day management 
services, and pre-service and post-service times based upon the AMA RUC 
recommendations.

                                     Table 8: CY 2010 CMS Proposed Work RVUs
----------------------------------------------------------------------------------------------------------------
                                                                                   2009 AMA RUC      2010 CMS
          CPT code \1\                      Descriptor              Pre-AMA RUC     recommended    proposed work
                                                                  eval. work RVU     work RVU           RVU
----------------------------------------------------------------------------------------------------------------
21025...........................  Excision of bone, lower jaw...           11.07            9.87            7.23
23415...........................  Release of shoulder ligament..           10.09            9.07           10.64
25116...........................  Remove wrist/forearm lesion...            7.38            7.38            4.83
42440...........................  Excise submaxillary gland.....            7.05            7.05            6.88
52341...........................  Cysto w/ureter stricture tx...            6.11            5.35            5.20
52342...........................  Cysto w/up stricture tx.......            6.61            5.85            5.63
52343...........................  Cysto w/renal stricture tx....            7.31            6.55            6.55
52344...........................  Cysto/uretero, stricture tx...            7.81            7.05            6.83
52345...........................  Cysto/uretero w/up stricture..            8.31            7.55            8.51
52346...........................  Cystouretero w/renal strict...            9.34            8.58            9.02
52400...........................  Cystouretero w/congen repr....           10.06            8.66            8.25
52500...........................  Revision of bladder neck......            9.39            7.99            8.49
52640...........................  Relieve bladder contracture...            6.89            4.73            4.28
53445...........................  Insert uro/ves nck sphincter..           15.21           15.21           17.02
54410...........................  Remove/replace penis prosth...           16.48           15.00           16.01
54530...........................  Removal of testis.............            9.31            8.35            8.65
57287...........................  Revise/remove sling repair....           11.49           10.97           10.36
62263...........................  Epidural lysis mult sessions..            6.41            6.41            6.04
62350...........................  Implant spinal canal cath.....            8.04            6.00            1.29

[[Page 33556]]


63650...........................  Implant neuroelectrodes.......            7.57            7.15            4.18
63685...........................  Insrt/redo spine n generator..            7.87            6.00            4.27
64708...........................  Revise arm/leg nerve..........            6.22            6.22            7.36
64831...........................  Repair of digit nerve.........           10.23            9.00            9.74
65285...........................  Repair of eye wound...........           14.43           14.43          14.43
----------------------------------------------------------------------------------------------------------------
\1\ All CPT codes copyright 2008 American Medical Association.

    Using the methodology described above, the adjustments to work RVUs 
for CPT codes 62355, 62360, 62361, 62362, and 62365 would result in 
negative valuation: 62355 = -1.96; 62360 = -2.31; 62361 = -2.42; 62362 
= -2.46; and 62365 = -1.88. For these codes, we are requesting that the 
AMA RUC re-review the entire family of associated codes and in the 
interim will maintain the AMA RUC recommended values until a 
methodology is developed to address codes that result in negative 
valuation when the methodology described above is utilized.
    In addition to the proposed revisions to the AMA RUC-recommended 
RVUs described above, we encourage the AMA RUC to utilize the building 
block methodology as described in the CY 2007 PFS proposed rule (71 FR 
37172) in the future when revaluing codes with site of service 
anomalies. We recognize that the AMA RUC looks at families of codes and 
may assign RVUs based on a particular code ranking within the family. 
However, the relative value scale requires each service to be valued 
based on the resources used in furnishing the service.
    We are also seeking public comment on alternative methodologies 
that could be utilized to establish work RVUs for codes that would have 
a negative valuation under the methodology we used for the proposed 
revisions to the AMA RUC-recommended values described above.
b. ``23-Hour'' Stay
    For services that are performed in the outpatient setting and 
require a hospital stay of less than 24 hours, we consider this an 
outpatient service and recognize the additional time associated with 
the patient evaluation and assessment in the post-service period. We 
are requesting that the AMA RUC include the additional minutes in their 
recommendations to CMS. We do not believe the current minutes assigned 
in the post-service period accurately reflects the total time required 
for evaluation and assessment of the patient. We believe the use of E/M 
codes for services rendered in the post-service period for procedures 
requiring less than a 24-hour hospital stay would result in overpayment 
for pre-service and intraservice work that would not be provided. 
Therefore, we will not allow an additional E/M service to be billed for 
care furnished during the post procedure period when care is furnished 
for an outpatient service requiring less than a 24-hour hospital stay.
5. Establishing Appropriate Relative Values for Physician Fee Schedule 
Services
    In MedPAC's March 2006 Report to Congress, MedPAC made a number of 
recommendations to improve the review of the relative values for PFS 
services. Since that time, we have taken significant action to improve 
the accuracy of the RVUs. As MedPAC noted in its recent March 2009 
Report to Congress, ``CMS and the AMA RUC have taken several steps to 
improve the review process'' in the intervening years since those 
initial recommendations. Many of our efforts to improve the accuracy of 
RVUs have also resulted in substantial increases in the payments for 
primary care services, which was one of the motivations for MedPAC's 
recommendations.
     We completed the most recent Five-Year Review of work 
RVUs, resulting in an increase in over 25 percent to the work RVUs for 
primary care services.
     We significantly revised the methodology for determining 
PE RVUs, resulting in more than a 5 percent increase for primary care 
services.
     We improved our processes for identifying potentially 
misvalued services by engaging in an ongoing review that includes 
screens for rapidly growing services and services with substantial 
shifts in site of service. We also identified approaches to address the 
issue of potentially misvalued services including reviewing services 
often billed together and the possibility of expanding the multiple 
procedure payment reduction (MPPR) to additional nonsurgical procedures 
and the update of high cost supplies.
     As discussed elsewhere in this proposed rule, we are 
proposing a number of improvements to the calculation and establishment 
of the work, PE, and malpractice RVUs that would result in overall 
payment increases to primary care specialties of between 6 percent and 
8 percent in CY 2010. These changes include a 6 percent increase in the 
work RVUs for office visits as a result of our proposal regarding 
consultation services; our proposed use of more accurate specialty-
specific survey data on physician practice costs; our proposal to 
revise the utilization rate assumption for certain equipment; and our 
proposed use of updated and expanded malpractice premium data in the 
calculation of the malpractice RVUs.
    MedPAC has in the past also recommended the establishment of a 
group panel of experts separate from the AMA RUC to review RVUs. This 
original March 2006 recommendation was summarized in its March 2008 
Report to Congress:

    ``We also recommended that CMS establish a group of experts, 
separate from the AMA RUC, to help the agency conduct these and 
other activities. This recommendation was intended not to supplant 
the AMA RUC but to augment it. To that end, the panel should include 
members who do not directly benefit from changes to Medicare's 
payment rates, such as experts in medical economics and technology 
diffusion and physicians who are employed by managed care 
organizations and academic medical centers.''

    The idea of a group of experts separate from the AMA RUC, to help 
the agency improve the review of relative values raises a number of 
issues. We seek broad public input on the following questions and other 
aspects of such an approach:
     How could input from a group of experts best be 
incorporated into existing processes of rulemaking and agency receipt 
of AMA RUC recommendations?
     What specifically would be the roles of a group of experts 
(for example,

[[Page 33557]]

identify potentially misvalued services, provide recommendations on 
valuation of specified services, review AMA RUC recommendations 
selected by the Secretary, etc.)?
     What should be the composition of a group of experts? How 
could such a group provide expertise on services that clinician group 
members do not furnish?
     How would such a group relate to the AMA RUC and existing 
Secretarial advisory panels such as the Practicing Physician Advisory 
Committee?
    Also of interest are comments on the resources required to 
establish and maintain such a group. As MedPAC noted in its March 2006 
Report with respect to the group of experts ``we recognize that these 
recommendations will increase demands on CMS and urge the Congress to 
provide the agency with the financial resources and administrative 
flexibility needed to undertake them.''
    We welcome comments on these topics, as well as others of interest 
to the stakeholder community. We will consider these comments as we 
consider the establishment of a group of experts to assist us in our 
ongoing reviews of the PFS RVUs.

G. Issues Related to the Medicare Improvements for Patients and 
Providers Act of 2008 (MIPPA)

    This section addresses certain provisions of the Medicare 
Improvements for Patients and Providers Act of 2008 (MIPPA) (Pub. L. 
110-275). We are proposing to revise our policies and regulations as 
described below in order to conform them to the statutory amendments.
1. Section 102: Elimination of Discriminatory Copayment Rates for 
Medicare Outpatient Psychiatric Services
    Prior to the enactment of the MIPPA, section 1833(c) of the Act 
provided that for expenses incurred in any calendar year in connection 
with the treatment of mental, psychoneurotic, and personality disorders 
of an individual who is not an inpatient of a hospital, only 62\1/2\ 
percent of such expenses are considered to be incurred under Medicare 
Part B when determining the amount of payment and application of the 
Part B deductible in any calendar year. This provision is known as the 
outpatient mental health treatment limitation (the limitation), and has 
resulted in Medicare paying only 50 percent of the approved amount for 
outpatient mental health treatment, rather than the 80 percent that is 
paid for most other outpatient services.
    Section 102 of the MIPPA amends the statute to phase out the 
limitation on recognition of expenses incurred for outpatient mental 
health treatment, which will result in an increase in the Medicare Part 
B payment for outpatient mental health services to 80 percent by CY 
2014. When this section is fully implemented in 2014, Medicare will pay 
for outpatient mental health services at the same level as other Part B 
services. For CY 2010, section 102 of the MIPPA provides that Medicare 
will recognize 68\3/4\ percent of expenses incurred for outpatient 
mental health treatment, which translates to a payment of 55 percent of 
the Medicare-approved amount. Section 102 of the MIPPA specifies that 
the phase out of the limitation will be implemented as shown in Table 9 
(provided that the patient has satisfied his or her deductible).

                               Table 9--Implementation of Section 102 of the MIPPA
----------------------------------------------------------------------------------------------------------------
                                                                    Recognized
                                                                     incurred      Patient pays    Medicare pays
                          Calendar year                            expenses (in    (in percent)    (in percent)
                                                                     percent)
----------------------------------------------------------------------------------------------------------------
CY 2009 and prior calendar years................................           62.50              50              50
CY 2010 and CY 2011.............................................           68.75              45              55
CY 2012.........................................................           75.00              40              60
CY 2013.........................................................           81.25              35              65
CY 2014.........................................................          100.00              20              80
----------------------------------------------------------------------------------------------------------------

    At present, Sec.  410.155(c) of the regulations includes examples 
to illustrate application of the current limitation. We are proposing 
to remove these examples from our regulations and, instead, to provide 
examples in this proposed rule, in our manual, and under provider 
education materials as needed. The following examples illustrate the 
application of the limitation in various circumstances as it is 
gradually reduced under section 102 of the MIPPA. We note that although 
we have used the CY 2009 Part B deductible of $135 for purposes of the 
examples below, the actual deductible amount for CY 2010 and future 
years will be subject to change.

    Example #1: In 2010, a clinical psychologist submits a claim for 
$200 for outpatient treatment of a patient's mental disorder. The 
Medicare-approved amount is $180. Since clinical psychologists must 
accept assignment, the patient is not liable for the $20 in excess 
charges. The patient previously satisfied the $135 annual Part B 
deductible. The limitation reduces the amount of incurred expenses 
to 68\3/4\ percent of the approved amount. Medicare pays 80 percent 
of the remaining incurred expenses. The Medicare payment and patient 
liability are computed as shown in Table 10.

                  Table 10--Example 1--CY 2010
------------------------------------------------------------------------

------------------------------------------------------------------------
1. Actual charges.......................................         $200.00
2. Medicare-approved amount.............................          180.00
3. Medicare incurred expenses (0.6875 x line 2) *.......          123.75
4. Unmet deductible.....................................            0.00
5. Remainder after subtracting deductible (line 3 minus           123.75
 line 4)................................................
6. Medicare payment (0.80 x line 5).....................           99.00
7. Patient liability (line 2 minus line 6)..............          81.00
------------------------------------------------------------------------
* The recognized incurred expenses for 2010 are 68\3/4\ percent.


[[Page 33558]]

    Example #2: In 2012, a clinical social worker submits a claim 
for $135 for outpatient treatment of a patient's mental disorder. 
The Medicare-approved amount is $120. Since clinical social workers 
must accept assignment, the patient is not liable for the $15 in 
excess charges. The limitation reduces the amount of incurred 
expenses to 75 percent of the approved amount. The patient 
previously satisfied $70 of the $135 annual Part B deductible, 
leaving $65 unmet (see Table 11).

                  Table 11--Example 2--CY 2012
------------------------------------------------------------------------

------------------------------------------------------------------------
1. Actual charges.......................................         $135.00
2. Medicare-approved amount.............................          120.00
3. Medicare incurred expenses (0.75 x line 2) *.........           90.00
4. Unmet deductible.....................................           65.00
5. Remainder after subtracting deductible (line 3 minus            25.00
 line 4)................................................
6. Medicare payment (0.80 x line 5).....................           20.00
7. Patient liability (line 2 minus line 6)..............         100.00
------------------------------------------------------------------------
* The recognized incurred expenses for CY 2012 are 75 percent.

    Example #3: In CY 2013, a physician who does not accept 
assignment submits a claim for $780 for services in connection with 
the treatment of a mental disorder that did not require inpatient 
hospitalization. The Medicare-approved amount is $750. Because the 
physician does not accept assignment, the patient is liable for the 
$30 in excess charges. The patient has not satisfied any of the $135 
Part B annual deductible (see Table 12).

                  Table 12--Example 3--CY 2013
------------------------------------------------------------------------

------------------------------------------------------------------------
1. Actual charges.......................................         $780.00
2. Medicare-approved amount.............................          750.00
3. Medicare incurred expenses (0.8125 x line 2) *.......          609.38
4. Unmet deductible.....................................          135.00
5. Remainder after subtracting deductible (line 3 minus           474.38
 line 4)................................................
6. Medicare payment (0.80 x line 5).....................          379.50
7. Patient liability (line 1 minus line 6)..............         400.50
------------------------------------------------------------------------
* The recognized incurred expenses for CY 2013 are 81\1/4\ percent.

    Example #4: A patient's Part B expenses during CY 2014 are for a 
physician's services in connection with the treatment of a mental 
disorder that initially required inpatient hospitalization, with 
subsequent physician services furnished on an outpatient basis. The 
patient has not satisfied any of the $135 Part B deductible. The 
physician accepts assignment and submits a claim for $780. The 
Medicare-approved amount is $750. Since the limitation will be 
completely phased out as of January 1, 2014, the entire $750 
Medicare-approved amount is recognized as the total incurred 
expenses because such expenses are no longer reduced. Also, there is 
no longer any distinction between mental health services the patient 
receives as an inpatient or outpatient (see Table 13).

                  Table 13--Example 4--CY 2014
------------------------------------------------------------------------

------------------------------------------------------------------------
1. Actual charges.......................................         $780.00
2. Medicare-approved amount.............................          750.00
3. Medicare incurred expenses (1.00 x line 2) *.........          750.00
4. Unmet deductible.....................................          135.00
5. Remainder after subtracting deductible (line 3 minus           615.00
 line 4)................................................
6. Medicare payment (0.80 x line 5).....................          492.00
7. Beneficiary liability (line 2 minus line 6)..........         258.00
------------------------------------------------------------------------
* The recognized incurred expenses for CY 2014 are 100 percent.

    Section 102 of the MIPPA did not make any other changes to the 
outpatient mental health treatment limitation. Therefore, other aspects 
of the limitation will remain unchanged during the transition period 
between CYs 2010 and 2014. The limitation will continue to be applied 
as it has been in accordance with our regulation at Sec.  410.155(b) 
which specifies that the limitation applies to outpatient treatment of 
a mental, psychoneurotic, or personality disorder, identified under the 
International Classification of Diseases (ICD) diagnosis code range 
290-319. We use the place of service code, and the procedure code to 
identify services to which the limitation applies.
    Additionally, we are proposing to make technical corrections to 
Sec.  410.155(b)(2) in order to update and clarify the services to 
which the limitation does not apply. Our proposed technical changes are 
as follows:
     Under Sec.  410.155(b)(2)(ii), revise the regulation to 
specify the HCPCS code, M0064 (or any successor code), that represents 
the statutory exception to the limitation for brief office visits for 
the sole purpose of monitoring or changing drug prescriptions used in 
mental health treatment.
     At Sec.  410.155(b)(2)(iv), we are proposing to revise the 
regulation to add neuropsychological tests and diagnostic psychological 
tests to the examples of diagnostic services that are not subject to 
the limitation when performed to establish a diagnosis.
     Under Sec.  410.155(b)(2)(v), we are proposing to revise 
the regulation to specify the CPT code 90862 (or any successor code) 
that represents pharmacologic management services to which the 
limitation does not apply when furnished to treat a patient who is 
diagnosed with Alzheimer's disease or a related disorder.

[[Page 33559]]

    Finally, we are proposing to add a new paragraph (c) to Sec.  
410.155 that provides a basic formula for computing the limitation 
during the phase-out period from CY 2010 through CY 2013, as well as 
after the limitation is fully removed from CY 2014 onward.
2. Section 131: Physician Payment, Efficiency, and Quality 
Improvements--Physician Quality Reporting Initiative (PQRI)
a. Program Background and Statutory Authority
    The Physician Quality Reporting Initiative (PQRI) is a voluntary 
reporting program that provides an incentive payment to eligible 
professionals who satisfactorily report data on quality measures for 
covered professional services during a specified reporting period. 
Under section 1848(k)(3)(B) of the Act, the term ``eligible 
professional'' means any of the following: (1) A physician; (2) A 
practitioner described in section 1842(b)(18)(C); (3) A physical or 
occupational therapist or a qualified speech-language pathologist; (4) 
A qualified audiologist. The PQRI was first implemented in 2007 as a 
result of section 101 of Division B of the Tax Relief and Health Care 
Act of 2006--the Medicare Improvements and Extension Act of 2006 (Pub. 
L. 109-432) (MIEA-TRHCA), which was enacted on December 20, 2006. The 
PQRI was extended and further enhanced as a result of the Medicare, 
Medicaid, and SCHIP Extension Act of 2007 (Pub. L. 110-173) (MMSEA), 
which was enacted on December 29, 2007, and the MIPPA, which was 
enacted on July 15, 2008. Changes to the PQRI as a result of these 
laws, as well as information about the PQRI in 2007, 2008, and 2009 are 
discussed in detail in the CY 2008 PFS proposed rule (72 FR 38196 
through 38204), CY 2008 PFS final rule with comment period (72 FR 66336 
through 66353), CY 2009 PFS proposed rule (73 FR 38558 through 38575), 
and CY 2009 PFS final rule with comment period (73 FR 69817 through 
69847). In addition, detailed information about the PQRI is available 
on the CMS Web site at http://www.cms.hhs.gov/PQRI.
b. Incentive Payments for the 2010 PQRI
    For 2010, section 1848(m)(1)(B) of the Act authorizes the Secretary 
to provide an incentive payment equal to 2.0 percent of the estimated 
total allowed charges (based on claims submitted not later than 2 
months after the end of the reporting period) for all covered 
professional services furnished during the reporting period for 2010. 
Although PQRI incentive payments are only authorized through 2010 under 
section 1848(m)(1)(A) of the Act, section 1848(k)(2)(C) of the Act 
provides for the use of consensus-based quality measures for the PQRI 
for 2010 and subsequent years.
    The PQRI incentive payment amount is calculated using estimated 
allowed charges for all covered professional services furnished under 
the PFS, not just those charges associated with the reported quality 
measures. ``Allowed charges'' refers to total charges, including the 
beneficiary deductible and coinsurance, and is not limited to the 80 
percent paid by Medicare or the portion covered by Medicare where 
Medicare is secondary payer. Amounts billed above the PFS amounts for 
assigned and non-assigned claims will not be included in the 
calculation of the incentive payment amount. In addition, since, by 
definition under section 1848(k)(3)(A)) of the Act, ``covered 
professional services'' are limited to services for which payment is 
made under, or is based on, the PFS and which are furnished by an 
eligible professional, other Part B services and items that may be 
billed by eligible professionals but are not paid under or based upon 
the Medicare Part B PFS are not included in the calculation of the 
incentive payment amount.
    Under section 1848(m)(6)(C) of the Act, the ``reporting period'' 
for the 2008 through 2011 PQRI is defined to be the entire year, but 
the Secretary is authorized to revise the reporting period for years 
after 2009 if the Secretary determines such ``revision is appropriate, 
produces valid results on measures reported, and is consistent with the 
goals of maximizing scientific validity and reducing administrative 
burden.''
    We are also required by section 1848(m)(5)(F) of the Act to 
establish alternative criteria for satisfactorily reporting and 
alternative reporting periods for registry-based reporting and for 
reporting measures groups. Therefore, eligible professionals who meet 
the proposed alternative criteria for satisfactorily reporting for 
registry-based reporting and for reporting measures groups for the 
proposed 2010 alternative reporting periods for registry-based 
reporting and for reporting measures groups would also be eligible to 
earn an incentive payment equal to 2.0 percent of the estimated total 
Medicare Part B PFS allowed charges for all covered professional 
services furnished by the eligible professional during the proposed 
alternative reporting periods for 2010 PQRI registry-based reporting or 
for reporting measures groups.
    The proposed PQRI reporting options for an individual eligible 
professional seeking to qualify for a 2010 PQRI incentive payment (that 
is, the proposed PQRI reporting mechanisms, proposed reporting periods, 
and proposed criteria for satisfactory reporting, including the 
proposed alternative reporting periods and alternative criteria for 
satisfactorily reporting for registry-based reporting and for reporting 
measures groups) are addressed in sections II.G.2.c. through II.G.2.f. 
of this proposed rule. The proposed 2010 PQRI quality measures and 
proposed 2010 PQRI measures groups are discussed in section II.G.2.i. 
of this proposed rule.
    Prior to 2010, the PQRI was an incentive program in which 
determination of whether an eligible professional satisfactorily 
reported quality data was made at the individual professional level, 
based on the National Provider Identifier (NPI). Although the incentive 
payments were made to the practice(s) represented by the Tax 
Identification Number (TIN) to which payments are made for the 
individual professional's services, there were no incentive payments 
made to the group practice based on a determination that the group 
practice, as a whole, satisfactorily reported PQRI quality measures 
data. To the extent individuals (based on the individuals' NPIs) 
satisfactorily reported data on PQRI quality measures that were 
associated with more than one practice or TIN, the determination of 
whether an eligible professional satisfactorily reported PQRI quality 
measures data was made for each unique TIN/NPI combination. Therefore, 
the incentive payment amount was calculated for each unique TIN/NPI 
combination and payment was made to the holder of the applicable TIN.
    However, section 1848(m)(3)(C)(i) of the Act requires that by 
January 1, 2010, the Secretary establish and have in place a process 
under which eligible professionals in a group practice (as defined by 
the Secretary) shall be treated as satisfactorily submitting data on 
quality measures for the PQRI for covered professional services for a 
reporting period, if, in lieu of reporting measures under subsection 
(k)(2)(C), the group practice reports measures determined appropriate 
by the Secretary, such as measures that target high-cost chronic 
conditions and preventive care, in a form and manner, and at a time, 
specified by the Secretary. Therefore, beginning with the 2010 PQRI, 
group practices who satisfactorily submit data on quality measures also 
would be eligible to earn an incentive payment equal to 2.0 percent of 
the

[[Page 33560]]

estimated total allowed charges for all covered professional services 
furnished by the group practice during the applicable reporting period. 
As required by section 1848(m)(3)(C)(iii) of the Act, payments to a 
group practice by reason of the process described above shall be in 
lieu of the PQRI incentive payments that would otherwise be made to 
eligible professionals in the group practice for satisfactorily 
submitting data on quality measures. Therefore, an individual eligible 
professional who is participating in the group practice reporting 
option as a member of a group practice would not be able to separately 
earn a PQRI incentive payment as an individual eligible professional.
    The process proposed to be used to determine whether a group 
practice satisfactorily submits data on quality measures for the 2010 
PQRI is described in section II.G.2.g. of this proposed rule. The 
proposed measures on which a group practice would need to report in 
order to be treated as satisfactorily submitting data on quality 
measures for the 2010 PQRI are discussed in section II.G.2.j. of this 
proposed rule.
c. Proposed 2010 Reporting Periods for Individual Eligible 
Professionals
    As we indicated above, section 1848(m)(6)(C) of the Act defines 
``reporting period'' for 2010 to be the entire year. Section 
1848(m)(6)(C)(ii) of the Act, however, authorizes the Secretary to 
revise the reporting period for years after 2009 if the Secretary 
determines such revision is appropriate, produces valid results on 
measures reported, and is consistent with the goals of maximizing 
scientific validity and reducing administrative burden. To be 
consistent with section 1848(m)(6)(C) of the Act and with prior years, 
we propose the 2010 PQRI reporting period for the reporting of 
individual PQRI quality measures through claims or a qualified 
electronic health record (EHR) (see section II.G.2.d. of this proposed 
rule for discussion of proposed 2010 PQRI reporting mechanisms) will be 
the entire year (that is, January 1, 2010 through December 31, 2010).
    We also considered exercising our authority to revise the reporting 
period for claims-based reporting of individual measures by proposing 
to add an alternative reporting period beginning July 1, 2010 for 
claims-based reporting of individual measures. Doing so would make the 
reporting periods for claims-based reporting of individual measures 
consistent with the alternative reporting periods for reporting 
measures groups and for registry-based reporting that have been in 
place since the 2008 PQRI. This would allow an eligible professional to 
earn a PQRI incentive payment equal to 2.0 percent of his or her 
estimated allowed charges for covered professional services furnished 
for the last half of 2010 if he or she satisfactorily reports data on 
individual PQRI quality measures through claims during the last half of 
2010. We received input from a few stakeholders in support of a partial 
year reporting period for claims-based reporting of individual measures 
to give more eligible professionals the opportunity to begin reporting 
later in the year. Other stakeholders recommended that we offer the 
same reporting periods for all reporting mechanisms. We agree that 
having the same reporting periods for all reporting mechanisms may be 
less complex. We also agree that the addition of a 6-month reporting 
period may facilitate participation in PQRI for certain eligible 
professionals. However, we do not believe that making a 6-month 
reporting period available would serve to enhance the validity of 
results on measures reported or to maximize scientific validity as 
required under section 1848(m)(6)(C)(ii) of the Act. In addition, given 
our desire to transition from the use of the claims-based reporting 
mechanism as the primary reporting mechanism for clinical quality 
measures for PQRI after 2010 to rely more heavily on registry-based 
reporting (see section II.G.2.d. of this proposed rule for further 
discussion), we do not believe it appropriate to add a new 6-month 
reporting period for claims-based reporting of individual measures. 
Given the fact that we seek to lessen reliance on the claims-based 
reporting mechanism for the PQRI after 2010, we believe the cost of 
adding a 6-month reporting period for claims-based reporting of 
individual measures outweighs any added flexibility that eligible 
professionals may receive in the short-term.
    Nevertheless, we invite comments on the decision to not propose a 
6-month reporting period for claims-based reporting of individual PQRI 
quality measures.
    In addition, section 1848(m)(5)(F) of the Act requires, for 2008 
and subsequent years, the Secretary to establish alternative reporting 
periods for reporting groups of measures and for registry-based 
reporting. To satisfy the requirements of section 1848(m)(5)(F) of the 
Act and to maintain program stability, we propose to retain the 2 
alternative reporting periods from the 2008 and 2009 PQRI for reporting 
measures groups and for registry-based reporting: (1) The entire year; 
and (2) a 6-month reporting period beginning July 1. Therefore, for 
2010, the proposed alternative reporting periods for reporting measures 
groups and for registry-based reporting are: (1) January 1, 2010 
through December 31, 2010; and (2) July 1, 2010 through December 31, 
2010. We note that the 6-month reporting period, beginning July 1, 
2010, is proposed to be available for reporting on measures groups and 
for reporting using the registry-based reporting mechanism only. For an 
eligible professional who satisfactorily reports measures groups or 
through the registry-based reporting mechanism for the 6-month 
reporting period, the eligible professional would qualify to earn a 
PQRI incentive payment equal to 2.0 percent of his or her total 
estimated allowed charges for covered professional services furnished 
between July 1, 2010 and December 31, 2010 only. The incentive payment 
would not be calculated based on the eligible professional's charges 
for covered professional services for the entire year.
d. Proposed 2010 PQRI Reporting Mechanisms for Individual Eligible 
Professionals
    When the PQRI was first implemented in 2007, there was only 1 
reporting mechanism available to submit data on PQRI quality measures. 
For the 2007 PQRI, the only way that eligible professionals could 
submit data on PQRI quality measures was by reporting the appropriate 
quality data codes on their Medicare Part B claims (claims-based 
reporting). For the 2008 PQRI, we added a second reporting mechanism as 
required by section 1848(k)(4) of the Act, so that eligible 
professionals could submit data on PQRI quality measures to a qualified 
PQRI registry and request the registry to submit PQRI quality measures 
results and numerator and denominator data on the 2008 PQRI quality 
measures or measures groups on their behalf (registry-based reporting). 
For the 2009 PQRI, we retained the 2 reporting mechanisms used in the 
2008 PQRI (that is, claims-based reporting and registry-based 
reporting) for reporting individual PQRI quality measures and for 
reporting measures groups.
    To promote the adoption of EHRs, we also conducted limited testing 
of a third reporting mechanism for the 2008 PQRI, which was the 
submission of clinical quality data extracted from an EHR, or the EHR-
based reporting mechanism. No incentive payment was available to those 
eligible professionals who participated in testing the EHR-based 
reporting mechanism. In the CY 2009 PFS proposed rule (73 FR 38564 
through 38565), we described our plans to test the submission of 
clinical quality

[[Page 33561]]

data extracted from qualified EHR products for five 2008 PQRI measures 
and proposed to accept PQRI data from EHRs and to pay PQRI incentive 
payments based on that submission for a limited subset of the proposed 
2009 PQRI quality measures. However, as described in the CY 2009 PFS 
final rule with comment period (73 FR 69830), we did not finalize our 
proposal to allow eligible professionals to submit clinical quality 
data extracted from EHRs for purposes of receiving a PQRI incentive 
payment for 2009. Since the 2008 EHR testing process was not complete 
at the time of publication of the CY 2009 PFS final rule, we instead 
opted to continue to test the submission of clinical quality data 
extracted from EHRs in 2009 and provide no incentive payment to those 
eligible professionals participating in testing the EHR-based reporting 
mechanism in 2009.
    For the 2010 PQRI, we are proposing to retain the claims-based 
reporting mechanism and the registry-based reporting mechanism. In 
addition, we are again proposing for the 2010 PQRI to accept PQRI 
quality measures data extracted from a qualified EHR product for a 
limited subset of the proposed 2010 PQRI quality measures, as 
identified in Table 20, contingent upon the successful completion of 
our 2009 EHR data submission testing process and a determination based 
on that testing process that accepting data from EHRs on quality 
measures for the 2010 PQRI is practical and feasible. We will make the 
determination as to whether accepting data from EHRs on quality 
measures is practical and feasible for the 2010 PQRI prior to 
publication of the CY 2010 PFS final rule with comment period. We will 
indicate in the CY 2010 PFS final rule with comment period whether we 
intend to finalize this proposal. If we finalize this proposal, then, 
unlike in prior years, an eligible professional would be able to earn a 
PQRI incentive payment through the EHR-based reporting mechanism in 
2010.
    We seek to offer more reporting mechanisms because we recognize 
that 1 mode of quality reporting does not suit all practices and our 
experience with the registry-based reporting mechanism thus far has 
been favorable. While the availability of multiple reporting mechanisms 
should increase opportunities for eligible professionals to 
satisfactorily report quality data for the PQRI, we also recognize that 
there are a number of limitations associated with claims-based 
reporting. On one hand, claims submission is available to nearly all 
eligible professionals. On the other hand, submission of quality data 
on claims has certain drawbacks since the claims processing system was 
developed for billing purposes and not for the submission of quality 
data. As we noted in the CY 2009 PFS final rule with comment period (73 
FR 69833), for example, measures with complex specifications, such as 
those that require multiple diagnosis codes are not as conducive to 
claims-based reporting and may be associated with a greater number of 
invalidly reported quality data codes. Similarly, when multiple 
measures share the same codes it may be difficult to determine which 
measure(s) the eligible professional intended to report through claims.
    We believe that EHR-based reporting is a viable option for 
overcoming the limitations associated with claims-based reporting of 
quality measures. Therefore, we propose to add an EHR-based reporting 
mechanism for the 2010 PQRI in order to promote the adoption and use of 
EHRs and to provide both eligible professionals and CMS experience on 
EHR-based quality reporting.
    Furthermore, on February 17, 2009, the President signed into law 
the American Recovery and Reinvestment Act (the Recovery Act) (Pub. L. 
111-5). Section 4101(a) of the Health Information Technology for 
Economic and Clinical Health (HITECH) Act (Title IV of Division B of 
the Recovery Act, together with Title XIII of Division A of the 
Recovery Act), which amends section 1848 of the Act to add new 
subsection (o), authorizes incentive payments under Medicare for 
certain eligible professionals who are ``meaningful EHR users'' 
beginning in 2011. However, the provisions in this proposed rule do not 
implement any HITECH Act statutory provisions. While our efforts to 
encourage the adoption and use of EHRs through testing EHR-based data 
submission in the 2008 and 2009 PQRI and our proposal to add an EHR-
based reporting mechanism for the purpose of receiving a PQRI incentive 
payment for the 2010 PQRI could potentially provide invaluable 
experience and serve as a foundation for establishing the capacity for 
eligible professionals to send, and for CMS to receive, data on quality 
measures via EHRs, the provisions of the HITECH Act will be implemented 
in future notice and comment rulemaking.
    In summary, we propose that for 2010, an eligible professional may 
choose to report data on PQRI quality measures through claims, to a 
qualified registry (for the qualification requirements for registries, 
see section II.G.2.i.(4) of this proposed rule), or through a qualified 
EHR product (for the qualification requirements for EHR vendors and 
their products, see section II.G.2.i.(5) of this proposed rule). 
Depending on which PQRI individual quality measures or measures groups 
an eligible professional selects, however, one or more of the proposed 
reporting mechanisms may not be available for reporting a particular 
2010 PQRI individual quality measure or measures group. The proposed 
2010 reporting mechanisms through which each proposed 2010 PQRI 
individual quality measure and measures group could be reported is 
identified in Tables 14 through 15. We invite comments on the proposed 
reporting mechanisms for the 2010 PQRI, including our proposal to add 
an EHR-based reporting mechanism to the 2010 PQRI, contingent upon the 
successful completion of our 2009 EHR data submission testing process 
and a determination that accepting data from EHRs on quality measures 
for the 2010 PQRI is practical and feasible.
    While we propose to retain the claims-based reporting mechanism for 
2010, we note that we are considering significantly limiting the 
claims-based mechanism of reporting clinical quality measures for the 
PQRI after 2010. This would be contingent upon there being an adequate 
number and variety of registries available and/or EHR reporting 
options. Potentially, we would retain claims-based reporting in years 
after 2010 principally for the reporting of structural measures, such 
as Measure 124 Health Information Technology (HIT): Adoption/
Use of Electronic Health Records (EHR), and circumstances where claims-
based reporting is the only available mechanism for certain categories 
of eligible professionals to report on PQRI quality measures.
    Reducing our reliance on the claims-based reporting mechanism after 
2010 will allow us and eligible professionals to devote available 
resources to maximizing the potential of registries and EHRs for 
quality measurement reporting. Both mechanisms hold the promise of more 
sophisticated and timely reporting on clinical quality measures. 
Clinical data registries allow the collection of more detailed data, 
including outcomes, without the necessity of a single submission 
contemporaneously with claims billing, which overcomes some of the 
limitations of the claims-based reporting mechanism. Registries can 
also provide feedback and quality improvement information based on 
reported data. Finally, clinical data registries can also receive data 
from EHRs, and therefore, serve as an alternative means to reporting 
clinical quality data extracted

[[Page 33562]]

from an EHR. As we continue to qualify additional registries, we 
believe that there will be a sufficient number of qualified PQRI 
registries by 2011 to make it possible to reduce or even discontinue 
the claims-based reporting mechanism for most measures after 2010. We 
invite comments on our intent to lessen our reliance on the claims-
based reporting mechanism for the PQRI beyond 2010.
    Regardless of the reporting mechanism chosen by an eligible 
professional, there is no requirement for the eligible professional to 
sign up or register to participate in the PQRI. However, there may be 
some requirements for participation through a specific reporting 
mechanism that are unique to that particular reporting mechanism. In 
addition to the criteria for satisfactory reporting of individual 
measures and measures groups described in sections II.G.2.e. and 
II.G.2.f., respectively, of this proposed rule, eligible professionals 
must ensure that they meet all requirements for their chosen reporting 
mechanism.
(1) Requirements for Individual Eligible Professionals Who Choose the 
Claims-Based Reporting Mechanism
    For eligible professionals who choose to participate in the PQRI by 
submitting data on individual quality measures or measures groups 
through the claims-based reporting mechanism, the only requirement 
associated with claims-based reporting that we are proposing apart from 
the proposed criteria for satisfactory reporting of individual measures 
and measures described below in sections II.G.2.e. and II.G.2.f., 
respectively, of this proposed rule, is the submission of the 
appropriate PQRI quality data codes on the professionals' Medicare Part 
B claims. An eligible professional would be permitted to submit the 
quality data codes for the eligible professional's selected individual 
PQRI quality measures or measures group at any time during the 2010 
reporting period. Please note, however, that as required by section 
1848(m)(1)(A) of the Act, all claims for services furnished between 
January 1, 2010 and December 31, 2010 must be processed by no later 
than February 28, 2011 to be included in the 2010 PQRI analysis.
(2) Requirements for Individual Eligible Professionals Who Choose the 
Registry-Based Reporting Mechanism
    In order to report quality measures results and numerator and 
denominator data on the 2010 PQRI individual quality measures or 
measures group through a qualified clinical registry, we propose that 
eligible professionals would need to enter into and maintain an 
appropriate legal arrangement with a qualified 2010 PQRI registry. Such 
arrangements would provide for the registry's receipt of patient-
specific data from the eligible professional and the registry's 
disclosure of quality measures results and numerator and denominator 
data on PQRI quality measures or measures groups on behalf of the 
eligible professional to CMS. Thus, the registry would act as a Health 
Insurance Portability and Accountability Act of 1996 (Pub. L. 104-191) 
(HIPAA) Business Associate and agent of the eligible professional. Such 
agents are referred to as ``data submission vendors.'' The ``data 
submission vendors'' would have the requisite legal authority to 
provide clinical quality measures results and numerator and denominator 
data on individual quality measures or measures groups on behalf of the 
eligible professional for the PQRI. The registry, acting as a data 
submission vendor, would submit registry-derived measures information 
to the CMS designated database for the PQRI, using a CMS-specified 
record layout. The record layout will be provided to the registry by 
CMS.
    To maintain compliance with applicable statutes and regulations, 
our program and its data system must maintain compliance with the HIPAA 
requirements for requesting, processing, storing, and transmitting 
data. Eligible professionals that conduct HIPAA covered transactions 
also must maintain compliance with the HIPAA requirements.
    Eligible professionals choosing to participate in PQRI by 
submitting quality measures results and numerator and denominator data 
on PQRI individual quality measures or measures groups through the 
registry-based reporting mechanism for 2010 would need to select a 
qualified PQRI registry and submit information on PQRI individual 
quality measures or measures groups to the selected registry in the 
form and manner and by the deadline specified by the registry.
    The process and requirements that we propose to use to determine 
whether a registry is qualified to submit quality measures results and 
numerator and denominator data on PQRI quality measures or measures 
groups on an eligible professional's behalf in 2010 are described in 
section II.G.2.d. of this proposed rule. We will post on the PQRI 
section of the CMS Web site at http://www.cms.hhs.gov a list of 
qualified registries for the 2010 PQRI, including the registry name, 
contact information, and the 2010 measure(s) and/or measures group(s) 
for which the registry is qualified and intends to report. We propose 
to post the names of 2010 PQRI qualified registries in 2 phases. In 
either event, even though a registry is listed as ``qualified,'' we 
cannot guarantee or assume responsibility for the registry's successful 
submission of PQRI quality measures results and numerator and 
denominate data on PQRI quality measures or measures groups on behalf 
of eligible professionals.
    In the first phase, we anticipate that by December 31, 2009, we 
will be able to, at minimum, post a list of those registries qualified 
for the 2010 PQRI based on: (1) Being a qualified registry for the 2008 
and 2009 PQRI that successfully submitted 2008 PQRI quality measures 
results and numerator and denominator data on the quality measures; (2) 
having received a letter indicating their continued interest in being a 
PQRI registry for 2010; and (3) the registry's compliance with the 2010 
PQRI registry requirements. By posting this first list of qualified 
registries for the 2010 PQRI, we seek to make available the names of 
registries that can be qualified at the start of the 2010 reporting 
period. We do this to accommodate requests we have received from 
eligible professionals who wish to avoid claims-based reporting pending 
knowing whether a particular registry is qualified for the 2010 PQRI.
    In the second phase, we anticipate to complete posting of the list 
of qualified 2010 registries as soon as we have completed vetting the 
registries interested in participating in the 2010 PQRI and identified 
the qualified registries for the 2010 PQRI, which we anticipate will be 
completed by no later than Summer 2010. An eligible professional's 
ability to report PQRI quality measures results and numerator and 
denominator data on PQRI quality measures or measures groups using the 
registry-based reporting mechanism should not be impacted by the 
complete list of qualified registries for the 2010 PQRI being made 
available after the start of the reporting period. First, registries 
will not begin submitting eligible professionals' PQRI quality measures 
results and numerator and denominator data on the quality measures or 
measures groups to CMS until 2011. Second, if an eligible professional 
decides that he or she is no longer interested in submitting quality 
measures results and numerator and denominator data on PQRI individual 
quality measures or measures group through the registry-based reporting 
mechanism after the complete list of qualified registries becomes 
available, this does not preclude the eligible

[[Page 33563]]

professional from attempting to meet the criteria for satisfactory 
reporting through another 2010 PQRI reporting mechanism.
    In addition to meeting the above proposed requirements specific to 
registry-based reporting, eligible professionals who choose to 
participate in PQRI through the registry-based reporting mechanism 
would need to meet the relevant criteria proposed for satisfactory 
reporting of individual measures or measures groups that all eligible 
professionals must meet in order to qualify to earn a 2010 PQRI 
incentive payment. The criteria for satisfactory reporting of 
individual measures and measures groups are described in sections 
II.G.2.e. and II.G.2.f., respectively, of this proposed rule.
(3) Requirements for Individual Eligible Professionals Who Choose the 
EHR-Based Reporting Mechanism
    For eligible professionals who choose to participate in the 2010 
PQRI by submitting data on individual quality measures through the EHR-
based reporting mechanism, the only proposed requirements associated 
with EHR-based reporting other than meeting the criteria for 
satisfactory reporting of individual measures described in section 
II.G.2.e. of this proposed rule are to: (1) Select a qualified EHR 
product and (2) submit clinical quality data extracted from the EHR to 
a CMS clinical data warehouse. Provided that our 2009 EHR data 
submission testing process is successful, we propose to begin accepting 
submission of clinical quality data extracted from ``qualified'' EHRs 
on January 1, 2010, or as soon thereafter as is technically feasible. 
We propose that eligible professionals will have until March 31, 2011 
to complete data submission through qualified EHRs for services 
furnished during the 2010 PQRI reporting period. The process that was 
used to determine whether an EHR vendor and its EHR product(s) are 
qualified to submit clinical quality data extracted from EHRs for the 
2010 PQRI is described in section II.G.2.d.5. of this proposed rule.
    The specifications for the electronic transmission of the proposed 
2010 PQRI measures identified in Table 20 (section II.G.2.i.(4) of this 
proposed rule) as being under consideration for EHR-based reporting in 
2010 will be posted on a public Web site when available. We will 
announce the availability and exact location of these specifications 
through familiar CMS communications channels, including the PQRI 
section of the CMS Web site at http://www.cms.hhs.gov/PQRI. The posting 
of specifications for the electronic transmission of any particular 
measure prior to publication of the final rule does not signify that 
the measure will necessarily be selected for the 2010 PQRI measure set, 
nor that EHR-based reporting will be accepted for that measure even if 
it may otherwise be included in the 2010 PQRI. However, by posting the 
specifications for electronic transmission of these measures, we seek 
to allow sufficient time for EHR vendors to adapt their products to 
support EHR-based capture and submission of data for these measures 
prior to the start of any 2010 PQRI reporting periods.
    We do not propose any option to report measures groups through EHR-
based reporting on services furnished during 2010. Because EHR-based 
reporting to CMS of data on quality measures would be new to PQRI for 
2010, we propose to make available only the criteria applicable to 
reporting of individual PQRI measures.
    We cannot assume responsibility for the successful submission of 
data from eligible professionals' EHRs. Any eligible professional who 
chooses to submit PQRI data extracted from an EHR should contact the 
EHR product's vendor to determine if the product is qualified and has 
been updated to facilitate PQRI quality measures data submission. Such 
professionals also should begin attempting submission promptly after we 
announce that the clinical data warehouse is ready to accept 2010 PQRI 
quality measures data through the EHR mechanism in order to assure the 
professional has a reasonable period of time to work with his or her 
EHR and/or its vendor to correct any problems that may complicate or 
preclude successful quality measures data submission through that EHR. 
As we indicated above, data submission for the 2010 PQRI would need to 
be completed by March 31, 2011.
(4) Qualification Requirements for Registries
    In order to be ``qualified'' to submit quality measures results and 
numerator and denominator data on PQRI quality measures and measures 
groups on behalf of eligible professionals pursuing incentive payment 
for the 2008 and 2009 PQRI, we required registries to complete a self-
nomination process and to meet certain technical and other 
requirements. For the 2009 PQRI, registries that were ``qualified'' for 
2008 did not need to be ``re-qualified'' for 2009 unless they were 
unsuccessful at submitting 2008 PQRI data (that is, failed to submit 
2008 PQRI data per the 2008 PQRI registry requirements). Registries 
that were ``qualified'' for 2008 and wished to continue to participate 
in 2009 were only required to communicate their desire to continue 
participation for 2009 by submitting a letter to CMS indicating their 
continued interest in being a PQRI registry for 2009 and their 
compliance with the 2009 PQRI registry requirements by March 31, 2009.
    For the 2010 PQRI, we are again proposing to require a self-
nomination process for registries wishing to submit 2010 PQRI quality 
measures or measures groups on behalf of eligible professionals for 
services furnished during the applicable reporting periods in 2010. 
Similar to the 2008 and 2009 PQRI registry self-nomination process, the 
proposed registry self-nomination process for the 2010 PQRI would be 
based on a registry meeting specific technical and other requirements.
    In order to be consistent with the registry requirements from prior 
program years, we propose that the 2010 registry requirements be 
substantially the same as for 2008 and 2009. Specifically, to be 
considered a qualified registry for purposes of submitting individual 
quality measures and measures groups on behalf of eligible 
professionals who choose to report using this reporting mechanism under 
the 2010 PQRI, we propose that a registry would need to:
     Be in existence as of January 1, 2009.
     Be able to collect all needed data elements and calculate 
results for at least 3 measures in the 2010 PQRI program (according to 
the posted 2010 PQRI Measure Specifications).
     Be able to calculate and submit measure-level reporting 
rates by TIN/NPI;
     Be able to calculate and submit, by TIN/NPI, a performance 
rate (that is, the percentage of a defined population who receive a 
particular process of care or achieve a particular outcome) for each 
measure on which the TIN/NPI reports;
     Be able to separate out and report on Medicare Part B FFS 
patients;
     Provide the name of the registry;
     Provide the reporting period start date the registry will 
cover;
     Provide the reporting period end date the registry will 
cover;
     Provide the measure numbers for the PQRI quality measures 
on which the registry is reporting;
     Provide the measure title for the PQRI quality measures on 
which the registry is reporting;
     Report the number of eligible instances (reporting 
denominator);
     Report the number of instances of quality service 
performed (numerator);

[[Page 33564]]

     Report the number of performance exclusions;
     Report the number of reported instances, performance not 
met (eligible professional receives credit for reporting, not for 
performance);
     Be able to transmit this data in a CMS-approved XML 
format. We expect that this CMS-specified record layout will be 
substantially the same as for the 2008 and 2009 PQRI. This layout will 
be provided to registries in 2010;
     Comply with a CMS-specified secure method for data 
submission, such as submitting its data in an XML file through an 
Individuals Access to CMS Systems (IACS) user account;
     Submit an acceptable ``validation strategy'' to CMS by 
March 31, 2010. A validation strategy ascertains whether eligible 
professionals have submitted accurately and on at least the minimum 
number (80 percent) of their eligible patients, visits, procedures, or 
episodes for a given measure. Acceptable validation strategies often 
include such provisions as the registry being able to conduct random 
sampling of their participants' data, but may also be based on other 
credible means of verifying the accuracy of data content and 
completeness of reporting or adherence to a required sampling method;
     Enter into and maintain with its participating 
professionals an appropriate Business Associate agreement that provides 
for the registry's receipt of patient-specific data from the eligible 
professionals, as well as the registry's disclosure of quality measure 
results and numerator and denominator data on behalf of eligible 
professionals who wish to participate in the PQRI program;
     Obtain and keep on file signed documentation that each 
holder of an NPI whose data are submitted to the registry has 
authorized the registry to submit quality measures results and 
numerator and denominator data to CMS for the purpose of PQRI 
participation. This documentation must be obtained at the time the 
eligible professional signs up with the registry to submit PQRI quality 
measures data to the registry and must meet any applicable laws, 
regulations, and contractual business associate agreements;
     Provide CMS access (if requested) to review the Medicare 
beneficiary data on which 2010 PQRI registry-based submissions are 
founded;
     Provide the reporting option (reporting period and 
reporting criteria) that the eligible professional has satisfied or 
chosen; and
     Provide CMS a signed, written attestation statement via 
mail or e-mail which states that the quality measure results and 
numerator and denominator data provided to CMS are accurate and 
complete.
    With respect to the submission of 2010 measure results and 
numerator and denominator data on measures groups, we propose to retain 
the following registry requirements from the 2009 PQRI:
     Indicate the reporting period chosen for each eligible 
professional who chooses to submit data on measures groups;
     Base reported information on measures groups only on 
patients to whom services were furnished during the 12-month reporting 
period of January through December 2010 or the 6-month reporting period 
of July 2010 through December 2010;
     Agree that the registry's data may be inspected by CMS 
under our oversight authority if non-Medicare patients are included in 
the patient sample;
     Be able to report data on all of the measures in a given 
measures group and on either 30 patients from January 1 through 
December 31, 2010 (note this patient sample must include some Medicare 
Part B FFS beneficiaries) or on 80 percent of applicable Medicare Part 
B FFS patients for each eligible professional (with a minimum of 15 
patients during the January 1, 2010 through December 31, 2010 reporting 
period or a minimum of 8 patients during the July 1, 2010 through 
December 31, 2010 reporting period) (see criteria for satisfactory 
reporting of measures groups described in section II.G.2.f. of this 
proposed rule for further information); and
     Be able to report the number of Medicare FFS patients and 
the number of Medicare Advantage patients that are included in the 
patient sample for a given measures group.
    In addition to the above requirements, we propose the following new 
requirements for registries for the 2010 PQRI:
     Registries must have at least 25 participants;
     Registries must provide at least 1 feedback report per 
year to participating eligible professionals;
     Registries must not be owned and managed by an individual 
locally-owned single-specialty group (in other words, single-specialty 
practices with only 1 practice location or solo practitioner practices 
would be prohibited from self-nominating to become a qualified PQRI 
registry);
     Registries must participate in ongoing 2010 PQRI mandatory 
support conference calls hosted by CMS (approximately 1 call per 
month);
     Registries must provide a flow and XML of a measure's 
calculation process for each measure type that the registry intends to 
calculate; and
     Registries must use PQRI measure specifications to 
calculate reporting or performance unless otherwise stated.
    These proposed new requirements are intended to improve the 
registry-based reporting mechanism by taking advantage of some of the 
registries' existing quality improvement functions, maximizing the 
registry's ability to successfully submit eligible professionals' 
quality measure results and numerator and denominator data on PQRI 
individual quality measures or measures groups to CMS, and discouraging 
small physician offices or an individual eligible professional from 
self-nominating to become a qualified registry. We are concerned that 
an individual eligible professional or a small practice does not have 
the resources or capabilities to successfully submit quality measures 
results and numerator and denominator data on PQRI individual measures 
or measures groups through the registry data submission process.
    We propose to post the final 2010 PQRI registry requirements, 
including the exact date by which registries that wish to qualify for 
2010 must submit a self-nomination letter and instructions for 
submitting the self-nomination letter, on the PQRI section of the CMS 
Web site at http://www.cms.hhs.gov/PQRI by November 15, 2009. We 
anticipate that new registries that wish to self-nominate for 2010 will 
be required to do so by January 31, 2010.
    Similar to the 2009 PQRI, we propose that registries that were 
``qualified'' for 2009 and wish to continue to participate in 2010 
would not need to be ``re-qualified'' for 2010 unless they are 
unsuccessful at submitting 2009 PQRI data (that is, fail to submit 2009 
PQRI data per the 2009 PQRI registry requirements). We further propose 
that registries that were ``qualified'' for 2009, were successful in 
submitting 2009 PQRI data, and wish to continue to participate in 2010 
would need to indicate their desire to continue participation for 2010 
by submitting a letter to CMS indicating their continued interest in 
being a PQRI registry for 2010 and their compliance with the 2010 PQRI 
registry requirements by no later than October 31, 2009. Instructions 
regarding the procedures for submitting this letter will be provided to 
qualified 2009 PQRI registries on the 2009 PQRI registry support 
conference calls.
    If a qualified 2009 PQRI registry fails to submit 2009 PQRI data 
per the 2009 PQRI registry requirements, we propose

[[Page 33565]]

the registry would be considered unsuccessful at submitting 2009 PQRI 
data and would need to go through the full self-nomination process 
again to participate in the 2010 PQRI. By March 31, 2010, registries 
that are unsuccessful submitting quality measures results and numerator 
and denominator data for 2009 would need to be able to meet the 2010 
PQRI registry requirements and go through the full vetting process 
again.
    Finally, as discussed further under section II.G.5.c.(1) of this 
proposed rule, we propose that the above registry requirements would 
apply not only for the purpose of a registry qualifying to report 2010 
PQRI quality measure results and numerator and denominator data on PQRI 
individual quality measures or measures groups, but also for the 
purpose of a registry qualifying to submit the proposed electronic 
prescribing measure for the 2010 E-Prescribing Incentive Program.
(5) Qualification Requirements for EHR Vendors and Their Products
    In the CY 2009 PFS final rule with comment period (73 FR 69830), we 
announced our intent to qualify EHR vendors and their specific products 
to submit quality data extracted from their EHR products to the CMS 
clinical quality data warehouse so that we may potentially begin to 
accept data via EHRs for purposes of satisfactorily reporting data on 
quality measures in future PQRI reporting. We stated that we anticipate 
posting on the PQRI section of the CMS Web site at http://
www.cms.hhs.gov/PQRI, by December 31, 2008, a list of requirements that 
EHR vendors must be able to meet in order to self-nominate to have 
their product ``qualified'' to potentially be able to submit quality 
measures data for the 2010 PQRI to CMS. We also stated that qualifying 
EHR vendors ahead of actual data submission will facilitate the live 
data submission process.
    On December 31, 2008, the ``Requirements for Electronic Health 
Record (EHR) Vendors to Participate in the 2009 PQRI EHR Testing 
Program,'' was posted on the Reporting page of the PQRI section of the 
CMS Web site at http://www.cms.hhs.gov/PQRI/20_
Reporting.asp#TopOfPage, which described the EHR vendor requirements 
and the EHR vendor self-nomination process.
    The vendor's EHR system must be updated according to the Draft 2009 
EHR specifications posted on the QualityNet Web site at http://
www.qualitynet.org in order for an EHR vendor and its product to 
qualify to submit test information on 2009 PQRI measures, and for 
possible EHR data submission for future PQRI reporting years. In 
addition, the 2009 PQRI EHR test-vendors must meet the following 
requirements:
     Be able to collect and transmit all required data elements 
according to the 2009 EHR Specifications.
     Be able to separate out and report on Medicare Part B FFS 
patients only.
     Be able to include TIN/NPI information submitted with an 
eligible professional's quality data.
     Be able to transmit this data in the CMS-approved format.
     Comply with a secure method for data submission.
     Enter into and maintain with its participating 
professionals an appropriate legal arrangement that provides for the 
EHR vendor to receive patient-specific data from the eligible 
professional, as well as the EHR vendor's disclosure of protected 
health information on behalf of eligible professionals who wish to 
participate in the 2009 PQRI EHR test program.
     Obtain and keep on file signed documentation that each NPI 
whose data is submitted to the EHR vendor has authorized the EHR vendor 
to submit patient data to CMS for the purpose of PQRI testing. This 
documentation must meet the standards of applicable law, regulations, 
and contractual or business associate agreements.
    As described in the ``Requirements for Electronic Health Record 
(EHR) Vendors to Participate in the 2009 PQRI EHR Testing Program,'' 
which is posted on the Reporting page of the PQRI section of the CMS 
Web site at http://www.cms.hhs.gov/PQRI/20_Reporting.asp#TopOfPage, 
EHR vendors who wish to qualify to participate in the 2009 PQRI EHR 
test program were required to submit a self-nomination letter 
requesting inclusion in the 2009 EHR testing process by February 13, 
2009. All nominees would then go through a vetting process. Those 
nominees passing this vetting process would be asked to submit test 
data (that is, mock-up data) or to submit live test data from some of 
their clients (users) with their permission. Vendors who successfully 
submit their test data would also need to be able to adapt their system 
to any changes in the measure specifications that may arise due to 
Healthcare Information Technology Standards Panel (HITSP) or 
Certification Commission for Healthcare Information Technology (CCHIT) 
adoption of quality measure data reporting criteria.
    It is expected that the process for qualifying self-nominated EHR 
vendors may conclude in 2009. At the conclusion of this process, we 
propose that those EHR products that meet all of the EHR vendor 
requirements will be listed on the PQRI section of the CMS Web site at 
http://www.cms.hhs.gov/PQRI as a ``qualified'' EHR product (that is, 
the name of the vendor software product and the version that is 
qualified), which indicates that the product's users may submit quality 
data to CMS (either directly from their system or through the vendor--
which is yet to be determined) for the 2010 PQRI, if and when, EHR 
submission is included in the 2010 PQRI as a PQRI reporting mechanism.
    As discussed further under section II.G.5.c.(1) of this proposed 
rule, we propose that the above EHR vendor requirements would apply not 
only for the purpose of a vendor's EHR product being qualified for the 
purpose of the product's users being able to submit data extracted from 
the EHR for the 2010 PQRI, but also for the purpose of a vendor's EHR 
product being qualified for the purpose of the product's users being 
able to electronically submit data extracted from the EHR for the 
electronic prescribing measure for the 2010 E-Prescribing Incentive 
Program.
    During 2010, we expect to use the self-nomination process described 
in the ``Requirements for Electronic Health Record (EHR) Vendors to 
Participate in the 2009 PQRI EHR Testing Program'' posted on the PQRI 
section of the CMS Web site at http://www.cms.hhs.gov/PQRI/20_
Reporting.asp#TopOfPage, to qualify additional EHR vendors and their 
EHR products to submit quality data extracted from their EHR products 
to the CMS clinical quality data warehouse for program years after 
2010. We anticipate that the requirements will be similar to those used 
to qualify EHR products for the 2009 PQRI EHR testing, but they may be 
modified based on the results of our 2009 EHR testing. At the 
conclusion of this process, sometime in late 2010, those EHR products 
that meet all of the EHR vendor requirements will be listed on the PQRI 
section of the CMS Web site at http://www.cms.hhs.gov/PQRI as a 
``qualified'' EHR product, which indicates that the product's users may 
submit quality data to CMS (either directly from their system or 
through the vendor--which is yet to be determined) for the 2011 PQRI or 
subsequent years, if and when, EHR submission is included as a PQRI 
reporting mechanism for years after 2010.
e. Proposed Criteria for Satisfactory Reporting of Individual Quality 
Measures for Individual Eligible Professionals
    Under section 1848(m)(3)(A) of the Act, the criteria for 
satisfactorily

[[Page 33566]]

submitting data on individual quality measures through claims-based 
reporting require the reporting of at least 3 applicable measures in at 
least 80 percent of the cases in which the measure is reportable. If 
fewer than 3 measures are applicable to the services of the 
professional, the professional may meet the criteria by reporting on 
all applicable measures (that is, 1 to 2 measures) for at least 80 
percent of the cases where the measures are reportable. It is assumed 
that if an eligible professional submits quality data codes for a 
particular measure, the measure applies to the eligible professional.
    In prior program years, when we were required, under section 
1848(m)(5)(F) of the Act, to establish alternative criteria for 
satisfactorily reporting using the registry-based reporting mechanism, 
we decided that the criteria for registry-based reporting of individual 
measures should be consistent with the criteria for claims-based 
reporting of individual measures. Thus, we adopted the same criteria 
for satisfactory reporting of individual measures through registry-
based reporting as the criteria for satisfactory reporting of 
individual measures through claims-based reporting except that an 
eligible professional could choose to report through the registry-based 
reporting mechanism only if there are at least 3 PQRI quality measures 
applicable to the services of the professional. For the 2008 or 2009 
PQRI, eligible professionals could not satisfactorily report PQRI 
measures through the registry-based reporting mechanism by reporting on 
fewer than 3 measures.
    For years after 2009, section 1848(m)(3)(D) of the Act authorizes 
the Secretary, in consultation with stakeholders and experts, to revise 
the criteria for satisfactorily reporting data on quality measures. 
Based on this authority and the input we have received from 
stakeholders via the invitation to submit suggestions for the 2010 PQRI 
reporting options posted on the PQRI section of the CMS Web site at 
http://www.cms.hhs.gov/PQRI in April 2009, we propose 3 criteria for 
satisfactory reporting of individual PQRI quality measures for 2010. In 
an effort to continue to be consistent with the criteria of 
satisfactory reporting used in prior PQRI program years, we propose to 
retain the following 2 criteria with respect to satisfactorily 
reporting data on individual quality measures in circumstances where 3 
or more individual quality measures apply to the services furnished by 
an eligible professional:
     Report on at least 3 2010 PQRI measures (unless fewer than 
3 2010 PQRI measures apply to the services furnished by the eligible 
professional); and
     Report each measure for at least 80 percent of the 
eligible professional's Medicare Part B FFS patients for whom services 
were furnished during the reporting period to which the measure 
applies.
    These criteria would apply to all proposed 2010 PQRI reporting 
mechanisms available for reporting individual PQRI quality measures 
(that is, claims-based reporting, registry-based reporting, and EHR-
based reporting).
    If an eligible professional has fewer than 3 PQRI measures that 
apply to the professional's services, then the professional would be 
able to meet the criteria for satisfactorily reporting data on 
individual quality measures by meeting the following 2 proposed 
criteria:
     Reporting on all measures that apply to the services 
furnished by the professional (that is 1 to 2 measures); and
     Reporting each measure for at least 80 percent of the 
eligible professional's Medicare Part B FFS patients for whom services 
were furnished during the reporting period to which the measure 
applies.
    We propose that, as in previous years, these criteria for 
satisfactorily reporting data on fewer than 3 individual quality 
measures would be available for the claims-based reporting mechanism 
only. An eligible professional who has fewer than 3 PQRI measures that 
apply to the professional's services would not be able to meet the 
criteria for satisfactory reporting by reporting on all applicable 
measures (that is, 1 or 2 measures) through the registry-based 
reporting mechanism.
    While we have received input from several stakeholders requesting 
that we permit an eligible professional to report fewer than 3 measures 
through the registry-based reporting mechanism if fewer than 3 measures 
apply to him or her, doing so would be inefficient. First, in addition 
to needing to analyze the data submitted to us by the registry, we 
would have to analyze the claims data to ensure that no additional 
measures are applicable to the eligible professional, much like what we 
do under the Measure Applicability Validation process for claims-based 
reporting. Second, we would also have to analyze the claims data to 
ensure that the eligible professional had not attempted to report 
additional measures through claims. For these reasons, we are not 
proposing to permit eligible professionals who choose the registry-
based or EHR-based reporting mechanism to report on individual quality 
measures to report on fewer than 3 measures if only 1 or 2 measures 
apply to the services they furnish.
    Based on the previously stated assumption that a measure applies to 
the eligible professional if an eligible professional submits quality 
data codes for a particular measure, we propose that an eligible 
professional who reports on fewer than 3 measures through the claims-
based reporting mechanism in 2010 may be subject to the Measure 
Applicability Validation process, which allows us to determine whether 
an eligible professional should have reported quality data codes for 
additional measures. This process was applied in the 2007 and 2008 
PQRI. When an eligible professional reports on fewer than 3 measures, 
we propose to review whether there are other closely related measures 
(such as those that share a common diagnosis or those that are 
representative of services typically provided by a particular type of 
professional). If an eligible professional who reports on fewer than 3 
measures in 2010 reports on a measure that is part of an identified 
cluster of closely related measures and did not report on any other 
measure that is part of that identified cluster of closely related 
measures, then the professional would not qualify to receive a 2010 
PQRI incentive payment. Additional information on the Measure 
Applicability Validation process can be found on the Analysis and 
Payment page of the PQRI section of the CMS Web site at http://
www.cms.hhs.gov/PQRI.
    In addition to the above criteria related to the number of measures 
on which an eligible professional would be required to report and the 
frequency of reporting, we propose a third criterion for satisfactory 
reporting of individual measures. Based on our authority to revise the 
criteria for satisfactory reporting under section 1848(m)(3)(D) of the 
Act, we propose that an eligible professional also be required to 
report data on at least one individual measure on a minimum number of 
Medicare Part B FFS patients seen during the reporting period, as 
detailed below. Establishing a minimum patient sample size requirement 
would enhance the scientific validity of eligible professionals' 
performance results and encourage eligible professionals to select to 
report only measures that are representative of the types of services 
they typically provide in their practice. If, for example, an eligible 
professional selects 3 patient-level measures (that is, measures in 
which the required

[[Page 33567]]

reporting frequency is a minimum of once per reporting period per 
individual eligible professional) where only one of his or her Medicare 
Part B FFS patients are eligible for the measures and there is no 
minimum patient sample size requirement, then the eligible professional 
currently could qualify to earn a PQRI incentive payment by reporting 
PQRI quality measures data only 3 times during the entire reporting 
period. We believe that information on such a small sample of cases 
would be insufficient to do any meaningful analysis of the eligible 
professional's performance on the reported measure. We also believe 
that a minimum patient sample size requirement would prevent an 
eligible professional from purposely selecting measures that apply to 
only a few of their patients.
    Regardless of the reporting mechanism chosen by the eligible 
professional, we propose that the minimum patient sample size for 
reporting individual quality measures be 15 Medicare Part B FFS 
patients for the 12-month reporting period. An eligible professional 
would need to meet this minimum patient sample size requirement for at 
least one measure on which the eligible professional chooses to report. 
This proposed number is based on our experience with the 2007 PQRI and 
the limited information we have available regarding the 2008 PQRI 
reporting experience. For the 2007 PQRI measures, where the only 
reporting period was a 6-month reporting period beginning July 1, 2007, 
the median number of instances in which an eligible professional could 
have reported a 2007 PQRI measure was, on average, 9 eligible instances 
per measure. If we assume that the number of eligible instances for the 
first half of 2007 were similar to the number of eligible instances in 
the second half of 2007, then we can assume that the median number of 
eligible instances was an average of 18 instances per measure for the 
entire year. Preliminary information from the 2008 PQRI, based on data 
through September 2008, indicate that the median number of instances in 
which an eligible professional could have reported a 2008 PQRI measure 
was, on average, 18 eligible instances per measure. Since eligible 
professionals are not required to report a measure for all eligible 
cases, we based the proposed minimum patient sample size threshold on 
80 percent of 18 eligible instances, which is 14.4.
    Similarly, for the 6-month reporting period (available for 
registry-based reporting only), we propose that the minimum patient 
sample size for reporting on individual quality measures be 8 Medicare 
Part B FFS patients seen during the 6-month reporting period. An 
eligible professional would need to meet this minimum patient sample 
size requirement for at least one measure on which the eligible 
professional chooses to report. We welcome comments on the proposal to 
add a minimum patient sample size criterion to the criteria for 
satisfactory reporting of data on individual quality measures. In 
addition, we invite comments on the specific thresholds proposed for 
the 12-month reporting period (available for claims-based, registry-
based, and EHR-based reporting) and for the 6-month reporting period 
(available for registry-based reporting only) for reporting individual 
quality measures.
    The proposed 2010 criteria for satisfactory reporting of data on 
individual PQRI quality measures are summarized in Table 14 and are 
arranged by reporting mechanism and reporting period.

   Table 14--Proposed 2010 Criteria for Satisfactory Reporting of Data on Individual PQRI Quality Measures, by
                                    Reporting Mechanism and Reporting Period
----------------------------------------------------------------------------------------------------------------
         Reporting  mechanism                      Reporting criteria                    Reporting period
----------------------------------------------------------------------------------------------------------------
Claims-based reporting................   Report at least 3 PQRI           January 1, 2010-December 31,
                                         measures, or 1-2 measures if less than    2010.
                                         3 measures apply to the eligible
                                         professional;
                                         Report each measure for at
                                         least 80% of the eligible
                                         professional's Medicare Part B FFS
                                         patients seen during the reporting
                                         period to whom the measure applies; and
                                         Report at least 1 PQRI measure
                                         on at least 15 Medicare Part B FFS
                                         patients seen during the reporting
                                         period to which the measure applies.
Registry-based reporting..............   Report at least 3 PQRI           January 1, 2010-December 31,
                                         measures;                                 2010.
                                         Report each measure for at
                                         least 80% of the eligible
                                         professional's Medicare Part B FFS
                                         patients seen during the reporting
                                         period to whom the measure applies; and.
                                         Report at least 1 PQRI measure
                                         on at least 15 Medicare Part B FFS
                                         patients seen during the reporting
                                         period to which the measure applies.
Registry-based reporting..............   Report at least 3 PQRI           July 1, 2010-December 31,
                                         measures;                                 2010.
                                         Report each measure for at
                                         least 80% of the eligible
                                         professional's Medicare Part B FFS
                                         patients seen during the reporting
                                         period to whom the measure applies; and.
                                         Report at least 1 PQRI measure
                                         on at least 8 Medicare Part B FFS
                                         patients seen during the reporting
                                         period to which the measure applies.
EHR-based reporting...................   Report at least 3 PQRI           January 1, 2010-December 31,
                                         measures;                                 2010.
                                         Report each measure for at
                                         least 80% of the eligible
                                         professional's Medicare Part B FFS
                                         patients seen during the reporting
                                         period to whom the measure applies; and.
                                         Report at least 1 PQRI measure
                                         on at least 15 Medicare Part B FFS
                                         patients seen during the reporting
                                         period to which the measure applies.
----------------------------------------------------------------------------------------------------------------


[[Page 33568]]

    As illustrated in Table 14, there are a total of 4 proposed 
reporting options, or ways in which an eligible professional may meet 
the criteria for satisfactory reporting on individual quality measures 
for the 2010 PQRI. Each reporting option consists of the criteria for 
satisfactorily reporting such data and results on individual quality 
measures relevant to a given reporting mechanism and reporting period. 
While eligible professionals may potentially qualify as satisfactorily 
reporting individual quality measures under more than one of the 
proposed reporting criteria, proposed reporting mechanisms, and/or for 
more than one proposed reporting period, only one incentive payment 
would be made to an eligible professional based on the longest 
reporting period for which the eligible professional satisfactorily 
reports.
f. Proposed Criteria for Satisfactory Reporting Measures Groups for 
Individual Eligible Professionals
    As described above, section 1848(m)(5)(F) of the Act requires that, 
for 2008 and subsequent years, the Secretary establish alternative 
reporting periods and alternative criteria for satisfactorily reporting 
groups of measures. In establishing these alternatives in prior years, 
we have labeled these groups of measures ``measures groups.'' We have 
previously defined ``measures groups'' as a subset of four or more PQRI 
measures that have a particular clinical condition or focus in common. 
The denominator definition and coding of the measures group identifies 
the condition or focus that is shared across the measures within a 
particular measures group.
    In the 2008 and 2009 PQRI, measures groups were reportable through 
claims-based or registry-based reporting. For the 2008 and 2009 PQRI, 
there were 2 basic sets of criteria for satisfactory reporting measures 
groups through claims-based or registry-based reporting: (1) The 
reporting of at least 1 measures group for at least 80 percent of 
patients to whom the measures group applies during the reporting 
period; or (2) the reporting of at least 1 measures group for a 
specified number of consecutive patients to whom the measures group 
applies during the reporting period. For registry-based reporting in 
the 2008 and 2009 PQRI, we allowed eligible professionals to include 
some non-Medicare Part B FFS patients in the consecutive patient sample 
under the second set of criteria. For registry-based reporting quality 
measures results and numerator and denominator data on measures groups 
in 2009, we also added to the first set of criteria a requirement to 
report the measures group on a minimum number of patients commensurate 
with the reporting period duration.
    For the 2010 PQRI, we again propose 2 basic sets of criteria for 
satisfactory reporting on measures group. Both sets of criteria would 
apply to the claims-based and registry-based reporting mechanism. As 
discussed in section II.G.2.d.(3) of this proposed rule, we are not 
proposing to make the EHR-based reporting mechanism available for 
reporting on measures groups in 2010.
    The first set of proposed criteria, which we propose to make 
available for either the 12-month or 6-month reporting period in 2010, 
would be consistent with the 2009 criteria for satisfactory reporting 
of measures groups through registry-based reporting, which require the 
reporting of at least 1 measures group for at least 80 percent of 
patients to whom the measures group applies during the applicable 
reporting period (with reporting required on a minimum number of 
Medicare Part B FFS patients commensurate with the reporting period 
duration). In the 2009 PQRI, there was a requirement under these 
criteria to report each measures group on at least 30 Medicare Part B 
FFS patients for the 12-month reporting period and at least 15 Medicare 
Part B FFS patients for the 6-month reporting period for registry-based 
reporting of measures groups. For the 2010 PQRI, we propose to revise 
the requirement by making these criteria applicable to both registry-
based and claims-based reporting and to change the number of Medicare 
Part B FFS patients on which an eligible professional would be required 
to report a measures group. We propose to require an eligible 
professional who chooses to report on measures groups based on 
reporting on 80 percent of applicable patients to report on a minimum 
of 15 Medicare Part B FFS patients for the 12-month reporting period 
and a minimum of 8 Medicare Part B FFS patients for the 6-month 
reporting period, regardless of whether the eligible professional 
chooses to report the measures group through claims-based reporting or 
registry-based reporting. We propose to revise the required minimum 
sample size to make the proposed 2010 criteria for satisfactory 
reporting of measures groups consistent with the proposed 2010 criteria 
for satisfactory reporting of individual measures. We invite comments 
on our proposal to make the criteria for satisfactory reporting of 
measures groups more consistent with those proposed for reporting 
individual measures. We especially would be interested in comments with 
respect to our proposal to revise the minimum sample size requirement 
related to satisfactory reporting on measures group through the 
registry-based reporting mechanism so that the criteria for 
satisfactory reporting of measures groups, regardless of reporting 
mechanism, would be identical to those proposed for reporting 
individual measures.
    The second set of proposed criteria, which we propose to make 
available for the 12-month reporting period only, would be based on 
reporting on a measures group on a specified minimum number of 
patients. The second set of criteria would require reporting on at 
least 1 measures group for at least 30 patients seen between January 1, 
2010 and December 31, 2010 to whom the measures group applies. Unlike 
the 2009 PQRI, which required that eligible professionals report on 
consecutive patients (that is, patients seen in order, by date of 
service), the 30 patients on which an eligible professional would need 
to report a measures group for 2010 would not need to be consecutive 
patients. The eligible professional would be able to report on any 30 
patients seen during the reporting period to which the measures group 
applies. We propose to remove the requirement to report on patients 
seen consecutively by date of service because our preliminary analysis 
of the 2008 PQRI claims-based reporting experience through September 
2008 suggests that this requirement is difficult for professionals to 
apply accurately to meet the criteria for satisfactory reporting of 
measures groups. In addition, the questions we receive from eligible 
professionals indicate that many eligible professionals are not clear 
on how to determine which patients are ``consecutive'' and should be 
included in the patient sample. We believe that any adverse effect on 
the reliability or validity of the quality information received as a 
result of the removal of the requirement to report on patients seen 
consecutively and allowing eligible professionals to report on any 30 
patients would be minimal. When eligible professionals report measures 
groups, they are required to report on multiple measures for a given 
clinical condition or focus, which makes it harder for them to 
selectively choose patients in an attempt to improve their performance 
results. We invite comments on our proposal to allow eligible 
professionals to report on measures groups on any 30 patients rather 
than a consecutive patient sample.
    As in previous years, we propose that for 2010, the patients, for 
claims-based


[[Continued on page 33569]]


From the Federal Register Online via GPO Access [wais.access.gpo.gov]
]                         
 
[[pp. 33569-33618]] Medicare Program; Payment Policies Under the Physician Fee 
Schedule and Other Revisions to Part B for CY 2010

[[Continued from page 33568]]

[[Page 33569]]

reporting, would be limited to Medicare Part B FFS patients. We receive 
claims on Medicare patients only. For registry-based reporting, 
however, we propose that the patients could include some, but not be 
exclusively, non-Medicare Part B FFS patients.
    The proposed 2010 criteria for satisfactory reporting on measures 
groups are summarized in Table 15, which is arranged by reporting 
mechanism and reporting period.

   Table 15--Proposed 2010 Criteria for Satisfactory Reporting on Measures Groups, by Reporting Mechanism and
                                                Reporting Period
----------------------------------------------------------------------------------------------------------------
       Reporting mechanism                            Reporting criteria                      Reporting period
----------------------------------------------------------------------------------------------------------------
Claims-based reporting...........   Report at least 1 PQRI measures group;          January 1, 2010-
                                                                                             December 31, 2010.
                                    Report each measures group for at least 30
                                    Medicare Part B FFS patients.
Claims-based reporting...........   Report at least 1 PQRI measures group;          January 1, 2010-
                                                                                             December 31, 2010.
                                    Report each measures group for at least 80% of
                                    the eligible professional's Medicare Part B FFS
                                    patients seen during the reporting period to whom the
                                    measures group applies; and
                                    Report each measures group on at least 15
                                    Medicare Part B FFS patients seen during the reporting
                                    period to which the measures group applies.
Claims-based reporting...........   Report at least 1 PQRI measures group;          July 1, 2010-
                                                                                             December 31, 2010.
                                    Report each measures group for at least 80% of  January 1, 2010-
                                    the eligible professional's Medicare Part B FFS          December 31, 2010.
                                    patients seen during the reporting period to whom the
                                    measures group applies; and
                                    Report each measures group on at least 8
                                    Medicare Part B FFS patients seen during the reporting
                                    period to which the measures group applies.
Registry-based reporting.........   Report at least 1 PQRI measures group;          January 1, 2010-
                                                                                             December 31, 2010.
                                    Report each measures group for at least 30
                                    patients. Patients may include, but may not be
                                    exclusively, non-Medicare Part B FFS patients.
Registry-based reporting.........   Report at least 1 PQRI measures group;          January 1, 2010-
                                                                                             December 31, 2010.
                                    Report each measures group for at least 80% of
                                    the eligible professional's Medicare Part B FFS
                                    patients seen during the reporting period to whom the
                                    measures group applies; and
                                    Report each measures group on at least 15
                                    Medicare Part B FFS patients seen during the reporting
                                    period to which the measures group applies.
Registry-based reporting.........   Report at least 1 PQRI measures group;          July 1, 2010-
                                                                                             December 31, 2010.
                                    Report each measures group for at least 80 %
                                    of the eligible professional's Medicare Part B FFS
                                    patients seen during the reporting period to whom the
                                    measures group applies; and
                                    Report each measures group on at least 8
                                    Medicare Part B FFS patients seen during the reporting
                                    period to which the measures group applies.
----------------------------------------------------------------------------------------------------------------

    As illustrated in Table 15, there are a total of 6 proposed 
reporting options, or ways in which an eligible professional may meet 
the proposed criteria for satisfactory reporting of measures groups for 
the 2010 PQRI. Each reporting option consists of the criteria for 
satisfactory reporting relevant to a given reporting mechanism and 
reporting period. As stated previously, while eligible professionals 
may potentially qualify as satisfactorily reporting on measures groups 
under more than one of the proposed reporting criteria, proposed 
reporting mechanisms, and/or for more than one proposed reporting 
period, only one incentive payment would be made to an eligible 
professional based on the longest reporting period for which the 
eligible professional satisfactorily reports.
g. Proposed Reporting Option for Satisfactory Reporting on Quality 
Measures by Group Practices
    As stated previously, section 1848(m)(3)(C)(i) of the Act requires 
the Secretary to establish and have in place a process by January 1, 
2010 under which eligible professionals in a group practice (as defined 
by the Secretary) shall be treated as satisfactorily submitting data on 
quality measures under PQRI if, in lieu of reporting measures under 
PQRI, the group practice reports measures determined appropriate by the 
Secretary, such as measures that target high-cost chronic conditions 
and preventive care, in a form and manner, and at a time specified by 
the Secretary. Section 1848(m)(3)(C)(ii) of the Act requires that this 
process provide for the use of a statistical sampling model to submit 
data on measures, such as the model used under the Medicare Physician 
Group Practice (PGP) demonstration project under section 1866A of the 
Act.
    In addition, payments to a group practice under section 1848(m) of 
the Act by reason of the process proposed herein shall be in lieu of 
the PQRI incentive payments that would otherwise be made to eligible 
professionals in the group practice for satisfactorily submitting data 
on quality measures (that is, prohibits double payments). Therefore, in 
addition to making incentive payments for 2010 to group practices based 
on separately analyzing whether the individual eligible professionals 
within the group practice (that is, for each TIN/NPI combination) 
satisfactorily reported on PQRI quality measures, we will begin making 
incentive payments to group practices based on the determination that 
the group practice, as a whole (that is, for the TIN), satisfactorily 
reports on

[[Page 33570]]

PQRI quality measures for 2010. In addition, an individual eligible 
professional who is affiliated with a group practice participating in 
the group practice reporting option that satisfactorily reports under 
the proposed group practice reporting option would not be eligible to 
earn a separate PQRI incentive payment for 2010 on the basis of his or 
her satisfactorily reporting PQRI quality measures data at the 
individual level.
    (1) Definition of ``Group Practice''
    As stated above, section 1848(m)(3)(C)(i) of the Act authorizes the 
Secretary to define ``group practice.'' For purposes of determining 
whether a group practice satisfactorily submits PQRI quality measures 
data, we propose that a ``group practice'' would consist of a physician 
group practice, as defined by a TIN, with at least 200 or more 
individual eligible professionals (or, as identified by NPIs) who have 
reassigned their billing rights to the TIN.
    Generally, our intent is to build on an existing quality reporting 
program that group practices may already be familiar with by modeling 
the PQRI group practice reporting option after the PGP demonstration. 
Since the PGP demonstration is a demonstration program for large group 
practices, one of the requirements for group practices participating in 
the PGP demonstration is for each practice to have 200 or more members. 
To be consistent with the PGP demonstration, we also propose to limit 
initial implementation of the PQRI group practice reporting option for 
2010 to similar large group practices. As we gain more experience with 
the group practice reporting option, we may consider lowering the group 
size threshold in the future. We invite comments on the proposed 
definition of ``group practice'' and our proposal to limit initial 
implementation of the PQRI group practice reporting option in 2010 to 
practices with 200 or more individual eligible professionals.
    In order to participate in the 2010 PQRI through the group practice 
reporting option, we propose to require group practices to complete a 
self-nomination process and to meet certain technical and other 
requirements. Group practices interested in participating in the 2010 
PQRI through the group practice reporting option would be required to 
submit a self-nomination letter to CMS or a CMS designee requesting to 
participate in the 2010 PQRI group practice reporting option. We 
propose that each group practice would be required to meet the 
following requirements:
     Have an active Individuals Access to CMS Systems (IACS) 
user account;
     Provide CMS or a CMS designee with the group practice's 
TIN and the NPI numbers and names of all eligible professionals who 
will be participating as part of the group practice (that is, all 
individual NPI numbers associated with the group practice's TIN). This 
information must be provided in an electronic format specified by CMS, 
such as in an Excel spreadsheet; and
     Agree to have the group practice's PQRI quality 
measurement performance rates for each measure publicly reported by 
posting of the results on a CMS Web site.
    We propose to post the final participation requirements for group 
practices, including the exact date by which group practices that wish 
to participate in the 2010 PQRI through the group practice reporting 
option must submit a self-nomination letter and other instructions for 
submitting the self-nomination letter, on the PQRI section of the CMS 
Web site at http://www.cms.hhs.gov/PQRI by November 15, 2009. We 
anticipate that group practices that wish to self-nominate for 2010 
will be required to do so by the end of the first quarter of 2010, but 
not later than the end of the second quarter of 2010. Upon receipt of 
the self-nomination letters we will assess whether the participation 
requirements proposed above have been met by each self-nominated group 
practice.
(2) Process for Physician Group Practices To Participate as Group 
Practices and Criteria for Satisfactory Reporting Data on Quality 
Measures by Group Practices
    For physician groups selected to participate in the PQRI group 
practice reporting option for 2010, we propose the reporting period 
would be the 12-month reporting period beginning January 1, 2010. We 
propose that group practices would be required to submit information on 
these measures using a data collection tool based on the data 
collection tool used in CMS' Medicare Care Management Performance 
(MCMP) demonstration and the quality measurement and reporting methods 
used in CMS' PGP demonstration. We propose that physician groups 
selected to participate in the 2010 PQRI through the group practice 
reporting option would be required to report on a common set of 26 NQF-
endorsed quality measures that are based on measures currently used in 
the MCMP and/or PGP demonstration and that target high-cost chronic 
conditions and preventive care. These quality measures are identified 
in Table 34. Additional information on the MCMP and PGP demonstrations 
is posted on the Medicare Demonstrations section of the CMS Web site at 
http://www.cms.hhs.gov/DemoProjectsEvalRpts/MD/list.asp#TopOfPage. 
Although our proposed process for physician groups to participate in 
PQRI as a group practice incorporates some characteristics and methods 
from the PGP demonstration and the MCMP demonstration, the PQRI group 
practice reporting option will be a separate program with its own 
specifications and methodology from the PGP and MCMP demonstration 
programs.
    The proposed quality measures identified in Table 34 are based on a 
subset of the Doctor's Office Quality (DOQ) quality measures set 
developed and specified under the direction of CMS and which are used 
in the PGP and/or MCMP demonstration programs. Contributors to the 
development of the DOQ measure set included the American Medical 
Association's Physician Consortium for Performance Improvement (AMA-
PCPI), the American College of Cardiology (ACC), the American Heart 
Association (AHA), the National Diabetes Quality Improvement Alliance, 
the National Committee for Quality Assurance (NCQA), and the Veterans 
Health Administration (VA) and, in most instances, overlap with 
proposed 2010 PQRI measures. These quality measures are grouped into 
four disease modules: diabetes; heart failure; coronary artery disease; 
and preventive care services.
    As part of the data submission process, we propose that, beginning 
in 2011, each group practice would be required to report quality 
measures with respect to services furnished during the 2010 reporting 
period (that is, January 1, 2010 through December 31, 2010) on an 
assigned sample of Medicare beneficiaries. We propose to analyze the 
January 1, 2010 through October 29, 2010 (that is, the last business 
day of October 2010) National Claims History (NCH) file to assign 
Medicare beneficiaries to each physician group practice using the same 
patient assignment methodology used in the PGP demonstration. Assigned 
beneficiaries are limited to those Medicare FFS beneficiaries with 
Medicare Parts A and B for whom Medicare is the primary payer. Assigned 
beneficiaries do not include Medicare Advantage enrollees. Essentially, 
a beneficiary would be assigned to the physician group that provides 
the plurality of a beneficiary's office or other outpatient E/M allowed 
charges (based on Medicare Part B claims submitted for the beneficiary 
for dates of services between January 1, 2010 and October 29, 2010). 
Beneficiaries with

[[Page 33571]]

only 1 visit to the group practice between January 1, 2010 and October 
29, 2010 would be eliminated from the group practice's assigned patient 
sample. Once the beneficiary assignment has been made for each 
physician group, each physician group would be required to report the 
quality measures on a random sample of the assigned beneficiaries per 
disease module or preventive care measure. For each disease module or 
preventive care measure, the physician group would be required to 
report information on the assigned patients in the order in which they 
appear in the group's sample (that is, consecutively). In the fourth 
quarter of 2010, we would pull a random sample of assigned 
beneficiaries for each disease module or preventive care measure and 
provide the sample to the physician group consistent with the methods 
used in the PGP demonstration. Identical to the sampling method used in 
the PGP demonstration, the random sample must consist of at least 411 
assigned beneficiaries. If the pool of eligible assigned beneficiaries 
is less than 411, then the group practice must report on 100 percent of 
the assigned beneficiaries to participate in the group practice 
reporting option.
    We propose a unique reporting mechanism for the group practice 
reporting option that would not be available to individual eligible 
professionals participating in the 2010 PQRI. We propose that each 
physician group selected to participate in the group practice reporting 
option would have access to a database (that is, a data collection 
tool) that would include the assigned beneficiary sample and the 
quality measures. This data collection tool was originally developed 
for use in the PGP demonstration, updated for use in the MCMP 
demonstration, and would be updated as needed for use in the PQRI. The 
assigned beneficiaries' demographic and utilization information would 
be prepopulated based on claims data. We anticipate being able to 
provide the selected physician groups with access to this prepopulated 
database by the fourth quarter of 2010. The physician group would be 
required to populate the remaining data fields necessary for capturing 
quality measure information on each of the assigned beneficiaries. 
Numerators for each of the quality measures would include all 
beneficiaries in the denominator population who also satisfy the 
quality performance criteria for that measure. Denominators for each 
quality measure would include a sample of the assigned beneficiaries 
who meet the eligibility criteria for that quality measure module or 
preventive care measure.
    We invite comments on our proposal to adopt the PGP demonstration's 
quality measurement and reporting methods for the PQRI group practice 
reporting option. We specifically request comments on the proposed 
patient assignment methodology and our proposal to use a data 
collection tool based on the one used in the MCMP demonstration as the 
reporting mechanism for physician groups selected to participate in the 
PQRI group practice reporting option.
    We propose 2 criteria for satisfactory reporting of quality 
measures by a physician group. First, the physician group would be 
required to report completely on all of the proposed modules and 
measures listed in Table 34. Second, the physician group would be 
required to report on the first 411 consecutively assigned Medicare 
beneficiaries per disease module or preventive care measure. This is 
identical to the reporting criteria used in the PGP demonstration. By 
building on an existing demonstration program that large group 
practices may already have experience with, we hope to minimize burden 
on both group practices and CMS. The sample that we pull for and 
provide to each physician group would include more than the 411 
assigned beneficiaries (the sample would include an over sample of 
approximately 50 percent). More beneficiaries are provided in the 
sample than the group practice is required to report on in order to 
account for beneficiaries included in the sample who cannot be 
confirmed with the diagnosis for a particular disease module or whose 
medical information may not be able to be located within the physician 
group's systems.
h. Statutory Requirements and Other Considerations for Measures 
Proposed for Inclusion in the 2010 PQRI
(1) Statutory Requirements for Measures Proposed for Inclusion in the 
2010 PQRI
    As a result of section 131(b) of the MIPPA, the statutory 
requirements with respect to the use of quality measures for the 2010 
PQRI are different from the statutory requirements for previous program 
years. For the 2007 PQRI, section 1848(k)(2)(A)(i) of the Act required 
the Secretary to generally select the quality measures identified as 
2007 physician quality measures under the Physician Voluntary Reporting 
Program. For the 2008 and 2009 PQRI, section 1848(k)(2)(B) of the Act 
required that the quality measures be measures that have been adopted 
or endorsed by a consensus organization (such as the National Quality 
Forum or AQA), that include measures that have been submitted by a 
physician specialty, and that the Secretary identifies as having used a 
consensus-based process for developing such measures. For purposes of 
reporting data on quality measures for covered professional services 
furnished during 2010 and subsequent years for the PQRI, subject to the 
exception noted below, section 1848(k)(2)(C)(i) of the Act, as added by 
MIPPA, requires that the quality measures shall be such measures 
selected by the Secretary from measures that have been endorsed by the 
entity with a contract with the Secretary under subsection 1890(a) of 
the Act, as added by section 183 of the MIPPA. On January 14, 2009, the 
U.S. Department of Health and Human Services awarded the contract 
required under section 1890(a) of the Act to the National Quality Forum 
(NQF).
    In the case of a specified area or medical topic determined 
appropriate by the Secretary for which a feasible and practical measure 
has not been endorsed by the NQF, however, section 1848(k)(2)(C)(ii) of 
the Act authorizes the Secretary to specify a measure that is not so 
endorsed as long as due consideration is given to measures that have 
been endorsed or adopted by a consensus organization identified by the 
Secretary, such as the AQA alliance. In light of these statutory 
requirements, we believe that, except in certain specified 
circumstances, each proposed 2010 PQRI quality measure would need to be 
endorsed by the NQF by July 1, 2009. In those circumstances in which a 
feasible and practical measure has not been endorsed by the NQF, we 
believe that all other proposed 2010 PQRI quality measures would need 
to have at least been adopted by the AQA or another organization with 
comparable consensus-organization characteristics. However, in January 
2009, the AQA announced that it will no longer be adopting measures and 
we are not aware of any other organizations with consensus-organization 
characteristics (see 73 FR 38565 through 38566 for discussion of the 
considerations applied in determining whether an entity is a consensus 
organization). Therefore, our policy with respect to identifying 
exceptions under section 1848(k)(2)(C)(ii) of the Act would be to give 
due consideration to measures that have been endorsed by the NQF. As a 
result, in reviewing measures for possible inclusion in the 2010 PQRI 
quality measure set, we propose that any new quality measures proposed 
for the 2010 PQRI must be NQF-endorsed

[[Page 33572]]

by July 1, 2009, while any proposed 2010 PQRI quality measures selected 
from the 2009 PQRI quality measure set would need to have been adopted 
by the AQA as of January 31, 2009, if the measure still is not endorsed 
by the NQF by July 1, 2009.
    In addition, section 1848(k)(2)(D) of the Act requires that for 
each 2010 PQRI quality measure, ``the Secretary shall ensure that 
eligible professionals have the opportunity to provide input during the 
development, endorsement, or selection of measures applicable to 
services they furnish.'' Measure developers generally include a public 
comment phase in their measure development process. As part of the 
measure development process, measure developers typically solicit 
public comments on measures that they are testing in order to determine 
whether additional refinement of the measure(s) is needed prior to 
submission for consensus endorsement. For example, information on the 
measure development process employed by us when CMS or a CMS contractor 
is the measure developer is available in the ``Measures Management 
System Blueprint'' found on the CMS Web site at http://www.cms.hhs.gov/
apps/QMIS/mmsBlueprint.asp.
    Eligible professionals also have the opportunity to provide input 
on a measure as the measure is being vetted through the NQF consensus 
endorsement process (and previously, the AQA consensus adoption 
process). In particular, the NQF employs a public comment period for 
measures vetted through its consensus endorsement process (and 
previously, for the AQA, its consensus adoption process).
    Finally, eligible professionals have an opportunity to provide 
input on the measures proposed for inclusion in the 2010 PQRI through 
this proposed rule, which provides a 60-day comment period. 
Accordingly, with regard to the 2010 PQRI, we believe we have satisfied 
this requirement in multiple ways.
(2) Other Considerations for Measures Proposed for Inclusion in the 
2010 PQRI
    Consistent with the statutory requirements described in section 
II.G.2.h.(1) of this proposed rule, we propose to apply the following 
considerations with respect to the selection of 2009 PQRI quality 
measures proposed for inclusion in the 2010 PQRI quality measure set:
     Where some 2009 PQRI quality measures have been endorsed 
by the NQF and others have not, those 2009 PQRI quality measures that 
have been specifically considered by NQF for possible endorsement, but 
NQF has declined to endorse it, are not proposed for inclusion in the 
2010 PQRI quality measure set (that is, we propose to retire the 
measure for 2010).
     In circumstances where no NQF-endorsed measure is 
available, we propose to exercise the exception under section 
1848(k)(2)(C)(ii) of the Act. Under these circumstances, a 2009 PQRI 
quality measure that previously (that is, prior to January 31, 2009) 
has been adopted by the AQA would meet the requirements under the Act 
and we propose that it would be appropriate for eligible professionals 
to use the measure to submit quality measures data and/or quality 
measures results and numerator and denominator data on quality 
measures, as appropriate.
     Although we do not propose to include any 2009 PQRI 
measures that have not been endorsed by the NQF or adopted by the AQA 
in the final 2010 PQRI quality measure set, we acknowledge that section 
1848(k)(C)(ii) of the Act provides an exception to the requirement that 
the Secretary select measures that have been endorsed by the entity 
with a contract under section 1890(a) of the Act (that is, the NQF) as 
long as an area or medical topic for which a feasible and practical 
NQF-endorsed measure is not available has been identified and due 
consideration has been given to measures that have been endorsed by the 
NQF and/or, prior to January 31, 2009, adopted by the AQA.
     The statutory requirements under section 1848(k)(2)(C) of 
the Act, subject to the exception noted above, require only that the 
measures be selected from measures that have been endorsed by the 
entity with a contract with the Secretary under section 1890(a) (that 
is, the NQF) and are silent with respect to how the measures that are 
submitted to the NQF for endorsement were developed. The basic steps 
for developing measures applicable to physicians and other eligible 
professionals prior to submission of the measures for endorsement may 
be carried out by a variety of different organizations. We do not 
believe there needs to be any special restrictions on the type or make 
up of the organizations carrying out this basic development of 
physician measures, such as restricting the initial development to 
physician-controlled organizations. Any such restriction would unduly 
limit the basic development of quality measures and the scope and 
utility of measures that may be considered for endorsement as voluntary 
consensus standards.
     2009 PQRI measures that were part of the 2007 and/or 2008 
PQRI in which the 2007 and 2008 PQRI analytics indicate a lack of 
significant reporting and usage were not considered for inclusion in 
the 2010 PQRI.
    In addition to reviewing the 2009 PQRI measures and previously 
retired measures, for purposes of developing the proposed 2010 PQRI 
measures, we have reviewed and considered measure suggestions including 
comments received in response to the CY 2009 PFS proposed rule and 
final rule with comment period. Additionally, suggestions and input 
received through other venues, such as an invitation for measures 
suggestions posted on the PQRI section of the CMS Web site in February 
2009 were also reviewed and considered for purposes of our development 
of the list of proposed 2010 PQRI quality measures.
    With respect to the selection of new measures (that is, measures 
that have never been selected as part of a PQRI quality measure set for 
2009 or any prior year), we propose to apply the following 
considerations, which include many of the same considerations applied 
to the selection of 2009 PQRI quality measures for proposed inclusion 
in the 2010 PQRI quality measure set described above:
     High Impact on Healthcare.
     Measures that are high impact and support CMS and HHS 
priorities for improved quality and efficiency of care for Medicare 
beneficiaries. These current and long term priority topics include: 
Prevention; chronic conditions; high cost and high volume conditions; 
elimination of health disparities; healthcare-associated infections and 
other conditions; improved care coordination; improved efficiency; 
improved patient and family experience of care; improved end-of-life/
palliative care; effective management of acute and chronic episodes of 
care; reduced unwarranted geographic variation in quality and 
efficiency; and adoption and use of interoperable HIT.
     Measures that are included in, or facilitate alignment 
with, other Medicare, Medicaid, and CHIP programs in furtherance of 
overarching healthcare goals.
     NQF Endorsement.
    + Measures must be NQF-endorsed by July 1, 2009 in order to be 
considered for inclusion in the 2010 PQRI quality measure set.
    + Although we do not propose to include any new measures that are 
not endorsed by the NQF by July 1, 2009 in the final 2010 PQRI quality 
measure set, we acknowledge that section (k)(2)(C)(ii) of the Act 
provides an exception to the requirement that the Secretary select 
measures that have been endorsed by the entity with a contract under 
section 1890(a) of the Act (that is, the NQF). As

[[Page 33573]]

long as an area or medical topic for which a feasible and practical 
NQF-endorsed measure is not available has been identified and due 
consideration has been given to measures that have been adopted by the 
AQA or other consensus organization identified by Secretary.
    + The statutory requirements under section 1848(k)(2)(C) of the 
Act, subject to the exception noted above, require only that the 
measures be selected from measures that have been endorsed by the 
entity with a contract with the Secretary under section 1890(a) (that 
is, the NQF) and are silent with respect to how the measures that are 
submitted to the NQF for endorsement were developed. The basic steps 
for developing measures applicable to physicians and other eligible 
professionals prior to submission of the measures for endorsement may 
be carried out by a variety of different organizations. We do not 
believe there needs to be any special restrictions on the type or make 
up of the organizations carrying out this basic development of 
physician measures, such as restricting the initial development to 
physician-controlled organizations. Any such restriction would unduly 
limit the basic development of quality measures and the scope and 
utility of measures that may be considered for endorsement as voluntary 
consensus standards. The requirements under section 1848(k)(2)(C) of 
the Act pertain only to the selection of measures and not to the 
development of measures.
     Address Gaps in PQRI Measure Set.
    + Measures that increase the scope of applicability of the PQRI 
measures to services furnished to Medicare beneficiaries and expand 
opportunities for eligible professionals to participate in PQRI. We 
seek to achieve broad ability to assess the quality of care furnished 
to Medicare beneficiaries, and ultimately to compare performance among 
professionals. We seek to increase the circumstances where eligible 
professionals have at least 3 measures applicable to their practice and 
measures that help expand the number of measures groups with at least 
four measures in a group.
     Measures of various aspects of clinical quality including 
outcome measures, where appropriate and feasible, process measures, 
structural measures, efficiency measures, and measures of patient 
experience of care.
    Other considerations that we propose to apply to the selection of 
measures for 2010, regardless of whether the measure is a 2009 PQRI 
measure or not, are:
     Measures that are functional, which is to say measures 
that can be technically implemented within the capacity of the CMS 
infrastructure for data collection, analysis, and calculation of 
reporting and performance rates. This leads to preference for measures 
that reflect readiness for implementation, such as those that are 
currently in the 2009 PQRI program or have been through testing. The 
purpose of measure testing is to reveal the measure's strengths and 
weaknesses so that the limitations can be addressed and the measure 
refined and strengthened prior to implementation. For new measures, 
preference is given to those that can be most efficiently implemented 
for data collection and submission. Therefore, any measures that have 
been found to be technically impractical to report because they are 
analytically challenging due to any number of factors, including those 
that are claims-based, have not been included in the 2010 PQRI. For 
example, in some cases, we have proposed to replace existing 2009 PQRI 
measures with updated and improved measures that are less technically 
challenging to report.
     For some measures that are useful, but where data 
submission is not feasible through all otherwise available PQRI 
reporting mechanisms, a measure may be included for reporting solely 
through specific reporting mechanism(s) in which its submission is 
feasible. For example, we are proposing to limit reporting of some 
measures that previously were available for claims-based reporting and 
registry-based reporting to registry-based reporting only because they 
were technically challenging to report and/or analyze through the 
claims-based reporting mechanism. For further discussion of the 
proposed reporting mechanisms, see section II.G.2.d. of this proposed 
rule.
    We also reviewed 33 measures that have been retired from the PQRI 
in previous years using the considerations for selecting proposed 
measures for the 2010 PQRI discussed above. None were found to be 
eligible for inclusion in the 2010 PQRI quality measure set because 
they did not meet the criteria described above.
    We welcome comments on the implication of including or excluding 
any given measure or measures proposed herein in the final 2010 PQRI 
quality measure set and on our approach in selecting measures. We 
recognize that some commenters may also wish to recommend additional 
measures for inclusion in the 2010 PQRI measures that we have not 
herein proposed. While we welcome all constructive comments and 
suggestions, and may consider such recommended measures for inclusion 
in future measure sets for PQRI and/or other programs to which such 
measures may be relevant, we will not be able to consider such 
additional measures for inclusion in the 2010 measure set.
    As discussed above, section 1848(k)(2)(D) of the Act requires that 
the public have the opportunity to provide input during the selection 
of measures. We also are required by other applicable statutes to 
provide opportunity for public comment on provisions of policy or 
regulation that are established via notice and comment rulemaking. 
Measures that were not included in this proposed rule for inclusion in 
the 2010 PQRI that are recommended to CMS via comments on this proposed 
rule have not been placed before the public with opportunity for the 
public to comment on the selection of those measures within the 
rulemaking process. Even when measures have been published in the 
Federal Register, but in other contexts and not specifically proposed 
as PQRI measures, such publication does not provide true opportunity 
for public comment on those measures' potential inclusion in PQRI. 
Thus, such additional measures recommended for selection for the 2010 
PQRI via comments on this proposed rule cannot be included in the 2010 
measure set. However, as discussed above, we will consider comments and 
recommendations for measures, which may not be applicable to the final 
set of 2010 PQRI measures, for purposes of identifying measures for 
possible use in future years' PQRI or other initiatives to which those 
measures may be pertinent.
    In addition, as in prior years, we note that we do not use notice 
and comment rulemaking as a means to update or modify measure 
specifications. Quality measures that have completed the consensus 
process have a designated party (usually, the measure developer/owner) 
who has accepted responsibility for maintaining the measure. In 
general, it is the role of the measure owner, developer, or maintainer 
to make changes to a measure. Therefore, comments requesting changes to 
a specific proposed PQRI measure's title, definition, and detailed 
specifications or coding should be directed to the measure developer 
identified in Tables 16 through 34. Contact information for the 2009 
PQRI measure developers is listed in the ``2009 PQRI Quality Measures 
List,'' which is available on the PQRI section of the CMS Web site at 
http://www.cms.hhs.gov/PQRI.

[[Page 33574]]

i. Proposed 2010 PQRI Quality Measures for Individual Eligible 
Professionals
    As stated previously, individual eligible professionals have the 
choice of reporting PQRI quality measures data on either individual 
quality measures or on measures groups.
    Consistent with the statutory requirements for measures included in 
the 2010 PQRI and other considerations for identifying proposed 2010 
quality measures discussed in section II.G.2.h.(1) and II.G.2.h.(2), 
respectively, of this proposed rule, the individual quality measures 
identified for use in the 2010 PQRI will be selected from those we 
propose in this rule and will be finalized as of the date the CY 2010 
PFS final rule with comment period goes on display at the Office of the 
Federal Register. No changes (that is, additions or deletions of 
measures) will be made after publication of the CY 2010 PFS final rule 
with comment period. However, as was the case for 2008 and 2009, we may 
make modifications or refinements, such as revisions to measures titles 
and code additions, corrections, or revisions to the detailed 
specifications for the 2010 measures until the beginning of the 
reporting period. Such specification modifications may be made through 
the last day preceding the beginning of the reporting period. The 2010 
measures specifications for individual quality measures will be 
available on the PQRI section of the CMS Web site at http://
www.cms.hhs.gov/PQRI when they are sufficiently developed or finalized. 
We are targeting finalization and publication of the detailed 
specifications for all 2010 PQRI measures on the PQRI section of the 
CMS Web site by November 15, 2009 and will, in no event, publish these 
specifications later than December 31, 2009. The detailed 
specifications will include instructions for reporting and identify the 
circumstances in which each measure is applicable.
    For 2010, we are proposing that final PQRI quality measures will be 
selected from 153 of the 2009 PQRI measures and 149 measure suggestions 
received in response to the February 2009 invitation to submit 
suggestions for measures and measures groups for possible inclusion in 
the 2010 PQRI (that is, the ``Call for 2010 Measure Suggestions''). We 
propose to include a total of 168 measures (this includes both 
individual measures and measures that are part of a proposed 2010 
measures group) on which individual eligible professionals can report 
for the 2010 PQRI. The individual PQRI quality measures proposed for 
the 2010 PQRI are listed in Tables 17 through 20 and fall into four 
broad categories as set forth below in this section. The four 
categories are the following:
    (1) Proposed 2010 Individual Quality Measures Selected From the 
2009 PQRI Quality Measures Set Available for Claims-based Reporting and 
Registry-Based Reporting;
    (2) Proposed 2010 Individual Quality Measures Selected From the 
2009 PQRI Quality Measures Set Available for Registry-based Reporting 
Only;
    (3) New Individual Quality Measures Proposed for 2010; and
    (4) Proposed 2010 Measures Available for EHR-based Reporting.
    In addition, we propose 13 measures groups for 2010. The measures 
proposed for inclusion in each of the proposed 2010 measures groups are 
listed in Tables 21 through 33.
    (1) Proposed 2010 Individual Quality Measures Selected From the 
2009 PQRI Quality Measures Set Available for Claims-based Reporting and 
Registry-based Reporting
    After careful consideration of 2009 PQRI measures, we propose to 
retire 7 measures because they did not meet one or more of the 
considerations for selection of proposed 2010 measures discussed in 
section II.G.2.h. of this proposed rule. The measures, including their 
Measure Number and Measure Title, and the specific reason(s) we are 
using as the basis for our proposal to retire the measures are 
identified in Table 16.

 Table 16--2009 PQRI Quality Measures Not Proposed for Inclusion in the
                                2010 PQRI
------------------------------------------------------------------------
     Measure no.            Measure title         Reason for retirement
------------------------------------------------------------------------
11..................  Stroke and Stroke         Analytically challenging
                       Rehabilitation: Carotid   / Replaced with another
                       Imagining Reporting.      measure.
34..................  Stroke and Stroke         Analytically challenging
                       Rehabilitation: Tissue    / Replaced with another
                       Plasminogen Activator.    measure.
94..................  Otitis Media with         Lack of significant
                       Effusion (OME):           reporting.
                       Diagnostic Evaluation.
95..................  Otitis Media with         Lack of significant
                       Effusion (OME): Hearing   reporting.
                       Test.
143.................  Oncology: Medical and     Analytically
                       Radiation--Pain           challenging.
                       Intensity Quantified.
144.................  Oncology: Medical and     Analytically
                       Radiation--Plan of Care   challenging.
                       for Pain.
152.................  Coronary Artery Disease   Declined for NQF
                       (CAD): Lipid Profile in   Endorsement.
                       Patients with CAD.
------------------------------------------------------------------------

    We propose to include in the 2010 PQRI quality measure set 116 of 
the 2009 PQRI measures, which would be available for either claims-
based reporting or registry-based reporting as individual quality 
measures. We note that one of these proposed measures, Measure 
46 Medication Reconciliation: Reconciliation After Discharge 
from an Inpatient Facility, is reportable through the registry-based 
reporting mechanism only in the 2009 PQRI. However, for the 2010 PQRI, 
we propose to make this measure available for either claims-based 
reporting or registry-based reporting. For the 2009 PQRI, registries 
have reported difficulty capturing the required information since the 
measure requires the inpatient discharge to be correlated to the 
outpatient visit. Therefore, for the 2010 PQRI we propose to make this 
measure available for both claims-based and registry-based reporting.
    These 116 proposed measures do not include any measures that are 
proposed to be included as part of the 2010 Back Pain measures group. 
Similar to the 2009 PQRI, we propose that any 2010 PQRI measure that is 
included in the Back Pain measures group would not be reportable as 
individual measures through claims-based reporting or registry-based 
reporting.
    The 116 individual 2009 PQRI measures proposed for inclusion in the 
2010 PQRI quality measure set as individual quality measures for either 
claims-based reporting or registry-based reporting are listed by their 
Measure Number and Title in Table 17, along with the name of the 
measure's developer/owner, their NQF endorsement status as of May 1, 
2009, and their AQA adoption status as of January 31, 2009. The PQRI 
Measure Number is a unique identifier assigned by CMS to all measures 
in the PQRI measure set. Once a PQRI Measure Number is assigned to a 
measure, it will not be used again to identify a different

[[Page 33575]]

measure, even if the original measure to which the number was assigned 
is subsequently retired from the PQRI measure set. A description of the 
proposed measures listed in Table 17 can be found in the ``2009 PQRI 
Quality Measures List,'' which is available on the Measures and Codes 
page of the PQRI section of the CMS Web site at http://www.cms.hhs.gov/
PQRI.
    The 2009 measures that are proposed to be available for registry-
based reporting only for the 2010 PQRI are discussed and identified in 
section II.G.2.i.(2) of this proposed rule.

  Table 17--Proposed 2010 Measures Selected From the 2009 PQRI Quality Measure Set Available for Either Claims-
                                   Based Reporting or Registry-Based Reporting
----------------------------------------------------------------------------------------------------------------
                                            NQF endorsement status    AQA adoption status as
     Measure No.         Measure title           as of 5/1/09              of  1/31/09         Measure developer
----------------------------------------------------------------------------------------------------------------
1...................  Diabetes Mellitus:   Yes.....................  Yes....................  NCQA.
                       Hemoglobin A1c
                       Poor Control in
                       Diabetes Mellitus.
2...................  Diabetes Mellitus:   Yes.....................  Yes....................  NCQA.
                       Low Density
                       Lipoprotein (LDL-
                       C) Control in
                       Diabetes Mellitus.
3...................  Diabetes Mellitus:   Yes.....................  No.....................  NCQA.
                       High Blood
                       Pressure Control
                       in Diabetes
                       Mellitus.
6...................  Coronary Artery      Yes.....................  Yes....................  AMA-PCPI.
                       Disease (CAD):
                       Oral Antiplatelet
                       Therapy Perscribed
                       for Patients with
                       CAD.
9...................  Major Depressive     Yes.....................  Yes....................  NCQA.
                       Disorder (MDD):
                       Antidepressant
                       Medication During
                       Acute Phase for
                       Patients with MDD.
10..................  Stroke and Stroke    Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       Rehabilitation:
                       Computed
                       Tomography (CT) or
                       Magnetic Resonance
                       Imaging (MRI)
                       Reports.
12..................  Primary Open Angle   Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       Glaucoma (POAG):
                       Optic Nerve
                       Evaluation.
14..................  Age-Related macular  Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       Degeneration
                       (AMD): Dilated
                       Macular
                       Examination.
18..................  Diabetic             Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       Retinopathy:
                       Documentation of
                       Presence or
                       Absence of Macular
                       Edema and Level of
                       Severity of
                       Retinopathy.
19..................  Diabetic             Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       Retinopathy:
                       Communication with
                       the Physician
                       Managing On-going
                       Diabetes Care.
20..................  Perioperative Care:  Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       Timing of
                       Antibiotic
                       Prophylaxis--Order
                       ing Physician.
21..................  Perioperative Care:  Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       Selection of
                       Prophylactic
                       Antibiotic--First
                       OR Second
                       Generation
                       Cephalosporin.
22..................  Perioperative Care:  Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       Discontinuation of
                       Prophylactic
                       Antibiotics (Non-
                       Cardiac
                       Procedures).
23..................  Perioperative Care:  Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       Venous
                       Thromboembolism
                       (VTE) Prophylaxis
                       (When Indicated in
                       ALL Patients).
24..................  Osteoporosis:        Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       Communication with
                       the Physician
                       Managing On-going
                       Care Post Fracture.
28..................  Aspirin at Arrival   Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       for Acute
                       Myocardial
                       Infarction (AMI).
30..................  Perioperative Care:  Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       Timing of
                       Prophylactic
                       Antibiotics--Admin
                       istering Physician.
31..................  Stroke and Stroke    Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       Rehabilitation:
                       Deep Vein
                       Thrombosis
                       Prophylaxis (DVT)
                       for Ischemic
                       Stroke or
                       Intracranial
                       Hemorrhage.
32..................  Stroke and Stroke    Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       Rehabilitation:
                       Discharged on
                       Antiplatelet
                       Therapy.
35..................  Stroke and Stroke    Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       Rehabilitation:
                       Screening for
                       Dysphagia.
36..................  Stroke and Stroke    Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       Rehabilitation:
                       Consideration for
                       Rehabilitation
                       Services.
39..................  Screening or         Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       Therapy for
                       Osteoporosis for
                       Women Aged 65
                       Years and Older.
40..................  Osteoporosis:        Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       Management
                       Following Fracture.
41..................  Osteoporosis:        Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       Pharmacologic
                       Therapy.
43..................  Coronary Artery      Yes.....................  Yes....................  Society of
                       Bypass Graft                                                            Thoracic Surgeons
                       (CABG): Use of                                                          (STS).
                       Internal Mammary
                       Artery (IMA) in
                       Patients with
                       Isolated CABG
                       Surgery.

[[Page 33576]]


44..................  Coronary Artery      Yes.....................  Yes....................  STS.
                       Bypass Graft
                       (CABG):
                       Preoperative Beta-
                       Blocker in
                       Patients with
                       Isolated CABG
                       Surgery.
45..................  Perioperative Care:  Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       Discontinuation of
                       Prophylactic
                       Antiobitics
                       (Cardiac
                       Procedures).
46..................  Medication           Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       Reconciliation:
                       Reconciliation
                       After Discharge
                       from an Inpatient
                       Facility.
47..................  Advance Care Plan..  Yes.....................  Yes....................  AMA-PCPI/NCQA.
48..................  Urinary              Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       Incontinence:
                       Assessment of
                       Presence or
                       Absence of Urinary
                       Incontinence in
                       Women Aged 6 Years
                       and Older.
49..................  Urinary              Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       Incontinence:
                       Characterization
                       of Urinary
                       Incontinence in
                       Women Aged 65
                       Years and Older.
50..................  Urinary              Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       Incontinence: Plan
                       of Care for
                       Urinary
                       Incontinence in
                       Women Aged 65
                       Years and Older.
51..................  Chronic Obstructive  Yes.....................  No.....................  AMA-PCPI.
                       Pulmonary Disease
                       (COPD): Spirometry
                       Evaluation.
52..................  Chronic Obstructive  Yes.....................  No.....................  AMA-PCPI.
                       Pulmonary Disease
                       (COPD):
                       Bronchodilator
                       Therapy.
53..................  Asthma:              Yes.....................  Yes....................  AMA-PCPI.
                       Pharmacologic
                       Therapy.
54..................  12-Lead              Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       Electrocardiogram
                       (ECG) Performed
                       for Non-Traumatic
                       Chest Pain.
55..................  12-Lead              Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       Electrocardiogram
                       (ECG) Performed
                       for Syncope.
56..................  Community-Acquired   Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       Pneumonia (CAP):
                       Vital Signs.
57..................  Community-Acquired   Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       Pneumonia (CAP):
                       Assessment of
                       Oxygen Saturation.
58..................  Community-Acquired   Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       Pneumonia (CAP):
                       Assessment of
                       Mental Status.
59..................  Community-Acquired   Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       Pneumonia (CAP):
                       Empiric Antibiotic.
64..................  Asthma: Asthma       Yes.....................  Yes....................  AMA-PCPI.
                       Assessment.
65..................  Treatment for        Yes.....................  Yes....................  NCQA.
                       Children with
                       Upper Respiratory
                       Infection (URI):
                       Avoidance of
                       Inappropriate Use.
66..................  Appropriate Testing  Yes.....................  Yes....................  NCQA.
                       for Children with
                       Pharyngitis.
67..................  Myelodysplastic      Yes.....................  Yes....................  AMA-PCPI/American
                       Syndrome (MDS) and                                                      Society of
                       Acute Leukemias:                                                        Hematology (ASH).
                       Baseline
                       Cytogenetic
                       Testing Performed
                       on Bone Marrow.
68..................  Myelodysplastic      Yes.....................  Yes....................  AMA-PCPI/ASH.
                       Syndrome (MDS):
                       Documentation of
                       Iron Stores in
                       Patients Receiving
                       Erythropoietin
                       Therapy.
69..................  Multiple Myeloma:    Yes.....................  Yes....................  AMA-PCPI/ASH.
                       Treatment with
                       Bisphosphonates.
70..................  Chronic Lymphocytic  Yes.....................  Yes....................  AMA-PCPI/ASH.
                       Leukemia (CLL):
                       Baseline Flow
                       Cytometry.
71..................  Breast Cancer:       Yes.....................  Yes....................  AMA-PCPI/American
                       Hormonal Therapy                                                        Society of
                       for Stage IC-IIIC                                                       Clinical Oncology
                       Estrogen Receptor/                                                      (ASCO)/National
                       Progesterone                                                            Comprehensive
                       Receptor (ER/PR)                                                        Cancer Network
                       Positive Breast                                                         (NCCN).
                       Cancer.
72..................  Colon Cancer:        Yes.....................  Yes....................  AMA-PCPI/ASCO/
                       Chemotherapy for                                                        NCCN.
                       Stage III Colon
                       Cancer Patients.
76..................  Prevention of        Yes.....................  Yes....................  AMA-PCPI.
                       Catheter-Related
                       Bloodstream
                       Infections
                       (CRBSI): Central
                       Venous Catheter
                       (CVC) Insertion
                       Protocol.
79..................  End Stage Renal      Yes.....................  Yes....................  AMA-PCPI.
                       Disease (ESRD):
                       Influenza
                       Immunization with
                       Patients in ESRD.
84..................  Hepatitis C:         Yes.....................  Yes....................  AMA-PCPI.
                       Ribonucleic Acid
                       (RNA) Testing
                       Before Initiating
                       Treatment.
85..................  Hepatitis C: HCV     Yes.....................  Yes....................  AMA-PCPI.
                       Genotype Testing
                       Prior to Treatment.
86..................  Hepatitis C:         Yes.....................  Yes....................  AMA-PCPI.
                       Antiviral
                       Treatment
                       Prescribed.
87..................  Hepatitis C: HCV     Yes.....................  Yes....................  AMA-PCPI.
                       Ribonucleic Acid
                       (RNA) Testing at
                       Week 12 of
                       Treatment.
89..................  Hepatitis C:         Yes.....................  Yes....................  AMA-PCPI.
                       Counseling
                       Regarding Risk of
                       Alcohol
                       Consumption.

[[Page 33577]]


90..................  Hepatitis C:         Yes.....................  Yes....................  AMA-PCPI.
                       Counseling
                       Regarding Use of
                       Contraception
                       Prior to Antiviral
                       Therapy.
91..................  Acute Otitis         No......................  Yes....................  AMA-PCPI.
                       Externa (ACE):
                       Topical Therapy.
92..................  Acute Otitis         No......................  Yes....................  AMA-PCPI.
                       Externa (ACE):
                       Pain Assessment.
93..................  Acute Otitis         No......................  Yes....................  AMA-PCPI.
                       Externa (ACE):
                       Systemic
                       Antimicrobial
                       Therapy--Avoidance
                       of Inappropriate
                       Use.
99..................  Breast Cancer        Yes.....................  Yes....................  AMA-PCPI/College
                       Resection                                                               of American
                       Pathology                                                               Pathologists
                       Reporting: pT                                                           (CAP).
                       Category (Primary
                       Tumor) and pN
                       Category (Regional
                       Lymph Nodes) with
                       Histologic Grade.
100.................  Colorectal Cancer    Yes.....................  Yes....................  AMA-PCPI/CAP.
                       Resection
                       Pathology
                       Reporting: pT
                       Category (Primary
                       Tumor) and pN
                       Category (Regional
                       Lymph Nodes) with
                       Histologic Grace.
102.................  Prostate Cancer:     Yes.....................  Yes....................  AMA-PCPI.
                       Avoidance of
                       Overuse of Bone
                       Scan for Staging
                       Low-Risk Prostate
                       Cancer Patients.
104.................  Prostate Cancer:     Yes.....................  Yes....................  AMA-PCPI.
                       Adjuvant Hormonal
                       Therapy for High-
                       Risk Prostate
                       Cancer Patients.
105.................  Prostate Cancer:     Yes.....................  Yes....................  AMA-PCPI.
                       Three-Dimensional
                       (3D) Radiotherapy.
106.................  Major Depressive     Yes.....................  No.....................  AMA-PCPI.
                       Disorder (MDD):
                       Diagnostic
                       Evaluation.
107.................  Major Depressive     Yes.....................  No.....................  AMA-PCPI.
                       Disorder (MDD):
                       Suicide Risk
                       Assessment.
108.................  Rheumatoid           Yes.....................  No.....................  NCQA.
                       Arthritis (RA):
                       Disease Modifying
                       Anti-Rheumatic
                       Drug (DMARD)
                       Therapy.
109.................  Osteoarthritis:      Yes.....................  No.....................  AMA-PCPI.
                       Function and Pain
                       Assessment.
110.................  Preventive Care and  Yes.....................  No.....................  AMA-PCPI.
                       Screening:
                       Influenza
                       Immunization for
                       Patients >=50
                       Years Old.
111.................  Preventive Care and  Yes.....................  Yes....................  NCQA.
                       Screening:
                       Pneumonia
                       Vaccination for
                       Patients 65 Years
                       and Older.
112.................  Preventive Care and  Yes.....................  Yes....................  NCQA.
                       Screening:
                       Screening
                       Mammography.
113.................  Preventive Care and  Yes.....................  Yes....................  NCQA.
                       Screening:
                       Colorectal Cancer
                       Screening.
114.................  Preventive Care and  Yes.....................  Yes....................  AMA-PCPI.
                       Screening: Inquiry
                       Regarding Tobacco
                       Use.
115.................  Preventive Care and  Yes.....................  Yes....................  NCQA.
                       Screening:
                       Advising Smokers
                       to Quit.
116.................  Antibiotic           Yes.....................  No.....................  NCQA.
                       Treatment for
                       Adults with Acute
                       Bronchitis:
                       Avoidance of
                       Inappropriate Use.
117.................  Diabetes Mellitus:   Yes.....................  Yes....................  NCQA.
                       Dilated Eye Exam
                       in Diabetic
                       Patient.
119.................  Diabetes Mellitus:   Yes.....................  No.....................  NCQA.
                       Urine Screening
                       for Microalbumin
                       or Medical
                       Attention for
                       Nephropathy in
                       Diabetic Patients.
121.................  Chronic Kidney       No......................  Yes....................  AMA-PCPI.
                       Disease (CKD):
                       Laboratory Testing
                       (Calcium,
                       Phosphorous,
                       Intact Parathyroid
                       Hormone (iPTH) and
                       Lipid Profile).
122.................  Chronic Kidney       No......................  Yes....................  AMA-PCPI.
                       Disease (CKD):
                       Blood Pressure
                       Management.
123.................  Chronic Kidney       No......................  Yes....................  AMA-PCPI.
                       Disease (CKD):
                       Plan of Care--
                       Elevated
                       Hemoglobin for
                       Patients Receiving
                       Erythropoiesis-
                       Stimulating Agents
                       (ESA).
124.................  Health Information   Yes.....................  Yes....................  CMS/Quality
                       Technology (HIT):                                                       Insights of
                       Adoption/Use of                                                         Pennsylvania
                       Electronic Health                                                       (QIP).
                       Records (EHR).

[[Page 33578]]


126.................  Diabetes Mellitus:   Yes.....................  Yes....................  American Podiatric
                       Diabetic Foot and                                                       Medical
                       Ankle Care,                                                             Association
                       Peripheral                                                              (APMA).
                       Neuropathy--Neurol
                       ogical Evaluation.
127.................  Diabetes Mellitus:   Yes.....................  Yes....................  APMA.
                       Diabetic Foot and
                       Ankle Care, Ulcer
                       Prevention--Evalua
                       tion of Footwear.
128.................  Preventive Care and  Yes.....................  Yes....................  CMS/QIP.
                       Screening: Body
                       Mass Index (BMI)
                       Screening and
                       Follow-Up.
130.................  Documentation and    Yes.....................  Yes....................  CMS/QIP.
                       Verification of
                       Current
                       Medications in the
                       Medical Record.
131.................  Pain Assessment      Yes.....................  Yes....................  CMS/QIP.
                       Prior to
                       Initiation of
                       Patient Therapy
                       and Follow-Up.
134.................  Screening for        Yes.....................  Yes....................  CMS/QIP.
                       Clinical
                       Depression and
                       Follow-Up Plan.
135.................  Chronic Kidney       Yes.....................  Yes....................  AMA-PCPI.
                       Disease (CKD):
                       Influenza
                       Immunization.
140.................  Age-Related Macular  No......................  Yes....................  AMA-PCPI/NCQA.
                       Degeneration
                       (AMD): Counseling
                       on Antioxidant
                       Supplement.
142.................  Osteoarthritis       Yes.....................  Yes....................  AMA-PCPI.
                       (OA): Assessment
                       for Use of Anti-
                       Inflammatory or
                       Analgesic Over-the-
                       Counter (OTC)
                       Medications.
145.................  Radiology: Exposure  Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       Time Reported for
                       Procedures Using
                       Fluoroscopy.
146.................  Radiology:           Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       Inappropriate Use
                       of ``Probably
                       Benign''
                       Assessment
                       Category in
                       Mammography
                       Screening.
147.................  Nuclear Medicine:    Yes.....................  Yes....................  AMA-PCPI.
                       Correlation with
                       Existing Imaging
                       Studies for All
                       Patients
                       Undergoing Bone
                       Scintigraphy.
153.................  Chronic Kidney       Yes.....................  Yes....................  AMA-PCPI.
                       Disease (CKD):
                       Referral for
                       Arteriovenous (AV)
                       Fistula.
154.................  Falls: Risk          No......................  Yes....................  AMA-PCPI/NCQA.
                       Assessment.
155.................  Falls: Plan of Care  No......................  Yes....................  AMA-PCPI/NCQA.
156.................  Oncology: Radiation  Yes.....................  Yes....................  AMA-PCPI.
                       Dose Limits to
                       Normal Tissues.
157.................  Thoracic Surgery:    Yes.....................  Yes....................  STS.
                       Recording of
                       Clinical Stage for
                       Lung Cancer and
                       Esophageal Cancer
                       Resection.
158.................  Endarterectomy: Use  Yes.....................  No.....................  Society of
                       of Patch During                                                         Vascular Surgeons
                       Conventional                                                            (SVS).
                       Endarterectomy.
163.................  Diabetes Mellitus:   Yes.....................  No.....................  NCQA.
                       Foot Exam.
172.................  Hemodialysis         Yes.....................  No.....................  SVS.
                       Vascular Access
                       Decision-Making by
                       Surgeon to
                       Maximize Placement
                       of Autogenous
                       Arterial Venous
                       (AV) Fistula.
173.................  Preventive Care and  No......................  Yes....................  AMA-PCPI.
                       Screening:
                       Unhealthy Alcohol
                       Use--Screening.
175.................  Pediatric End Stage  No......................  Yes....................  AMA-PCPI.
                       Renal Disease
                       (ESRD): Influenza
                       Immunization.
176.................  Rheumatoid           No......................  Yes....................  AMA-PCPI/NCQA.
                       Arthritis (RA):
                       Tuberculosis
                       Screening.
177.................  Rheumatoid           No......................  Yes....................  AMA-PCPI/NCQA.
                       Arthritis (RA):
                       Periodic
                       Assessment of
                       Disease Activity.
178.................  Rhuematoid           No......................  Yes....................  AMA-PCPI/NCQA.
                       Arthritis (RA):
                       Functional Status
                       Assessment.
179.................  Rheumatoid           No......................  Yes....................  AMA-PCPI/NCQA.
                       Arthritis (RA):
                       Assessment and
                       Classification of
                       Disease Prognosis.
180.................  Rheumatoid           No......................  Yes....................  AMA-PCPI/NCQA.
                       Arthritis (RA):
                       Glucocorticoid
                       Management.
181.................  Elder Maltreatment   No......................  Yes....................  CMS/QIP.
                       Screen and Follow-
                       Up Plan.
182.................  Functional Outcome   No......................  Yes....................  CMS/QIP.
                       Assessment in
                       Chiropractic Care.
183.................  Hepatitis C:         Yes.....................  Yes....................  AMA-PCPI.
                       Hepatitis A
                       Vaccination in
                       Patients with HCV.
184.................  Hepatitis C:         Yes.....................  Yes....................  AMA-PCPI.
                       Hepatatis B
                       Vaccination in
                       Patients with HCV.

[[Page 33579]]


185.................  Endoscopy & Polyp    No......................  Yes....................  AMA-PCPI/NCQA.
                       Surveillance:
                       Colonoscopy
                       Interval for
                       Patients with a
                       History of
                       Adenomatous
                       Polyps--Avoidance
                       of Inappropriate
                       Use.
186.................  Wound Care: Use of   No......................  Yes....................  AMA-PCPI/NCQA.
                       Compression System
                       in Patients with
                       Venous Ulcers.
----------------------------------------------------------------------------------------------------------------

    Please note that detailed measure specifications for 2009 
individual PQRI quality measures may have been updated or modified 
during the NQF endorsement process or for other reasons prior to 2010. 
The 2010 PQRI quality measure specifications for any given individual 
quality measure may, therefore, be different from specifications for 
the same quality measure used for 2009. Specifications for all 2010 
individual PQRI quality measures, whether or not included in the 2009 
PQRI program, must be obtained from the specifications document for 
2010 individual PQRI quality measures, which will be available on the 
PQRI section of the CMS Web site on or before December 31, 2009.
(2) Proposed 2010 Individual Quality Measures Selected From the 2009 
PQRI Quality Measures Set Available for Registry-Based Reporting Only
    In the 2008 PQRI, all 2008 PQRI quality measures were reportable 
through either claims-based reporting or registry-based reporting. In 
the CY 2009 PFS final rule with comment period (73 FR 69833), we noted 
that some measures are not as conducive to claims-based reporting and 
indicated that 18 of the 2009 PQRI quality measures are not currently 
reportable through claims-based reporting due to their complexity. 
Instead, these 18 measures must be reported through a qualified PQRI 
registry for the 2009 PQRI. We referred to these measures as 
``registry-only'' measures. As discussed further in section II.G.2.d. 
of this proposed rule, registry-based reporting overcomes some of the 
limitations of claims-based reporting.
    For the 2010 PQRI, we again propose to include registry-only 
individual measures. For 2010, we propose to select 26 registry-only 
individual measures from the 2009 PQRI.
    As we noted previously, 1 measure (measure 46) that was a 
registry-only measure for the 2009 PQRI is now proposed to be available 
for either claims-based reporting or registry-based reporting in the 
2010 PQRI. Therefore, this measure is not included among these 26 
proposed registry-only individual measures. These 26 proposed measures 
do include 9 measures that are available for either claims-based 
reporting or registry-based reporting in the 2009 PQRI and are now 
proposed to be included in the 2010 PQRI as registry-only measures. We 
are proposing to make more 2009 measures registry-only to relieve some 
analytical difficulties encountered during the 2009 PQRI.
    Although we are designating certain measures as registry-only 
measures, we cannot guarantee that there will be a registry qualified 
to submit each registry-only measure for 2010. We rely on registries to 
self-nominate and identify the types of measures for which they would 
like to be qualified to submit quality measures results and numerator 
and denominator data on quality measures. If no registry self-nominates 
to submit measure results and numerator and denominator data on a 
particular type of measure for 2010, then an eligible professional 
would not be able to report that particular measure type. We invite 
comments on our proposal to increase the number of registry-only 
measures for the 2010 PQRI.
    The Measure Number and Measure Title for these proposed registry-
only measures are listed in Table 18 along with the name of each 
measure's developer, the measure's NQF endorsement status as of May 1, 
2009, and the measure's AQA adoption status as of January 31, 2009. A 
description of the proposed measures listed in Table 18 can be found in 
the ``2009 PQRI Quality Measures List,'' which is available on the 
Measures and Codes page of the PQRI section of the CMS Web site at 
http://www.cms.hhs.gov/PQRI. Measures that were available for either 
claims-based reporting or registry-based reporting in the 2009 PQRI but 
are proposed to be available for registry-based reporting only in the 
2010 PQRI are identified by an asterisk (*) in Table 18.

  Table 18--Proposed 2010 Measures Selected From the 2009 PQRI Quality Measure Set Available for Registry-Based
                                                 Reporting Only
----------------------------------------------------------------------------------------------------------------
                                            NQF endorsement status    AQA adoption status as
     Measure No.         Measure title           as of 5/1/09              of  1/31/09         Measure developer
----------------------------------------------------------------------------------------------------------------
5...................  Heart Failure:       Yes.....................  Yes....................  AMA-PCPI.
                       Angiotensin-
                       Converting Enzyme
                       (ACE) Inhibitor or
                       Angiotensin
                       Receptor Blocker
                       (ARB) Therapy for
                       Left Ventricular
                       Systolic
                       Dysfunction
                       (LVSD)*.
7...................  Coronary Artery      Yes.....................  Yes....................  AMA-PCPI.
                       Disease (CAD):
                       Beta-Blocker
                       Therapy for CAD
                       Patients with
                       Prior Myocardial
                       Infarction (MI).
8...................  Heart Failure: Beta- Yes.....................  Yes....................  AMA-PCPI.
                       Blocker Therapy
                       for Left
                       Ventricular
                       Systolic
                       Dysfunction
                       (LVSD)*.

[[Page 33580]]


 33.................  Stroke and Stroke    Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       Rehabilitation:
                       Anticoagulant
                       Therapy Prescribed
                       for Atrial
                       Fibrillation at
                       Discharge.
81..................  End Stage Renal      Yes.....................  Yes....................  AMA-PCPI.
                       Disease (ESRD):
                       Plan of Care for
                       Inadequate
                       Hemodialysis in
                       ESRD Patients.
82..................  End Stage Renal      Yes.....................  Yes....................  AMA-PCPI.
                       Disease (ESRD):
                       Plan of Care for
                       Inadequate
                       Peritoneal
                       Dialysis.
83..................  Hepatitis C:         Yes.....................  Yes....................  AMA-PCPI.
                       Testing for
                       Chronic Hepatitis
                       C--Confirmation of
                       Hepatitis C
                       Viremia*.
118.................  Coronary Artery      Yes.....................  No.....................  AMA-PCPI.
                       Disease (CAD):
                       Angiotensin-
                       Converting Enzyme
                       (ACE) Inhibitor or
                       Angiotensin
                       Receptor Blocker
                       (ARB) Therapy for
                       Patients with CAD
                       and Diabetes and/
                       or Left
                       Ventricular
                       Systolic
                       Dysfunction
                       (LSVD)*.
136.................  Melanoma: Follow-Up  No......................  Yes....................  AMA-PCPI/NCQA.
                       Aspects of Care*.
137.................  Melanoma:            No......................  Yes....................  AMA-PCPI/NCQA.
                       Continuity of
                       Care--Recall
                       System*.
138.................  Melanoma:            No......................  Yes....................  AMA-PCPI/NCQA.
                       Coordination of
                       Care*.
139.................  Cataracts:           No......................  Yes....................  AMA-PCPI/NCQA.
                       Comprehensive
                       Preoperative
                       Assessment for
                       Cataract Surgery
                       with Intraocular
                       Lens (IOL)
                       Placement*.
141.................  Primary Open-Angle   No......................  Yes....................  AMA-PCPI/NCQA.
                       Glaucoma (POAG):
                       Reduction of
                       Intraocular
                       Pressure (IOP) by
                       15% OR
                       Documentation of a
                       Plan of Care*.
159.................  HIV/AIDS: CD4+ Cell  Yes.....................  No.....................  AMA-PCPI/NCQA.
                       Count or CD4+
                       Percentage.
160.................  HIV/AIDS:            Yes.....................  No.....................  AMA-PCPI/NCQA.
                       Pneumocystis
                       Jiroveci Pneumonia
                       (PCP) Prophylaxis.
161.................  HIV/AIDS:            Yes.....................  No.....................  AMA-PCPI/NCQA.
                       Adolescent and
                       Adult Patients
                       with HIV/AIDS Who
                       Are Prescribed
                       Potent
                       Antiretroviral
                       Therapy.
162.................  HIV/AIDS: HIV RNA    Yes.....................  No.....................  AMA-PCPI/NCQA.
                       Control After Six
                       Months of Potent
                       Antiretroviral
                       Therapy.
164.................  Coronary Artery      Yes.....................  Yes....................  STS.
                       Bypass Graft
                       (CABG): Prolonged
                       Intubation
                       (Ventilation).
165.................  Coronary Artery      Yes.....................  Yes....................  STS.
                       Bypass Graft
                       (CABG): Deep
                       Sternal Wound
                       Infection Rate.
166.................  Coronary Artery      Yes.....................  Yes....................  STS.
                       Bypass Graft
                       (CABG): Stroke/
                       Cerebrovascular
                       Accident (CVA).
167.................  Coronary Artery      Yes.....................  Yes....................  STS.
                       Bypass Graft
                       (CABG):
                       Postoperative
                       Renal
                       Insufficiency.
168.................  Coronary Artery      Yes.....................  Yes....................  STS.
                       Bypass Graft
                       (CABG): Surgical
                       Re-exploration.
169.................  Coronary Artery      Yes.....................  Yes....................  STS.
                       Bypass Graft
                       (CABG):
                       Antiplatelet
                       Medications at
                       Discharge.
170.................  Coronary Artery      Yes.....................  Yes....................  STS.
                       Bypass Graft
                       (CABG): Beta-
                       Blockers
                       Administered at
                       Discharge.
171.................  Coronary Artery      Yes.....................  Yes....................  STS.
                       Bypass Graft
                       (CABG): Lipid
                       Management and
                       Counseling.
174.................  Pediatric End Stage  No......................  Yes....................  AMA-PCPI.
                       Renal Disease
                       (ESRD): Plan of
                       Care for
                       Inadequate
                       Hemodialysis.
----------------------------------------------------------------------------------------------------------------
* Individual 2009 PQRI measures that were available for both claims-based and registry-based reporting but
  proposed to be available for registry-based reporting only for the 2010 PQRI.

    Please note that detailed measure specifications for 2009 PQRI 
quality measures may have been updated or modified during the NQF 
endorsement process or for other reasons prior to 2010. Therefore, the 
2010 PQRI quality measure specifications for any given quality measure 
may be different from specifications for the same quality measure used 
for 2009. Specifications for all 2010 individual PQRI quality measures, 
whether or not included in the 2009 PQRI program, must be obtained from 
the specifications document for 2010 individual PQRI quality measures, 
which will be available on the PQRI section of the CMS Web site on or 
before December 31, 2009.
(3) New Individual Quality Measures Proposed for 2010
    We propose to include in the 2010 PQRI quality measure set 22 
measures that were not included in the 2009 PQRI quality measures 
provided that each

[[Page 33581]]

measure obtains NQF endorsement by July 1, 2009 and its detailed 
specifications are completed and ready for implementation in PQRI by 
August 15, 2009. Besides having NQF endorsement, the development of a 
measure is considered complete for the purposes of the 2010 PQRI if by 
August 15, 2009--(1) The final, detailed specifications for use in data 
collection for PQRI have been completed and are ready for 
implementation, and (2) all of the Category II Current Procedural 
Terminology (CPT II) codes required for the measure have been 
established and will be effective for CMS claims data submission on or 
before January 1, 2010. The titles of these proposed additional, or 
new, measures are listed in Table 19 along with the name of the measure 
developer and the proposed reporting mechanism (that is, whether the 
measure is proposed to be reportable using claims, registries, or 
both). For these 22 proposed measures, a PQRI Measure Number will be 
assigned to a measure if and when the measure is included in the final 
set of 2010 PQRI measures.
    Due to the complexity of their measure specifications, we propose 
that 16 of these 22 measures would be available as registry-only 
measures for the 2010 PQRI. We do not believe that these 16 measures 
are conducive to the claims-based reporting mechanism. The remaining 6 
measures would be available for reporting through either claims-based 
reporting or registry-based reporting.

                           Table 19--New Individual Quality Measures Proposed for 2010
----------------------------------------------------------------------------------------------------------------
                               NQF  endorsement
        Measure title           status as  of 5/  AQA adoption status      Measure       Reporting  mechanism(s)
                                     1/09           as of  1/31/09        developer
----------------------------------------------------------------------------------------------------------------
Thrombolytic Therapy           Yes.............  No..................  American Heart   Registry.
 Administered.                                                          Association
                                                                        (AHA)/American
                                                                        Stroke
                                                                        Association
                                                                        (ASA).
Referral for Otologic          Pending NQF       No..................  Audiology        Claims, Registry.
 Evaluation for Patients with   review.                                 Quality
 Visible Congenital or                                                  Consortium
 Traumatic Deformity of the                                             (AQC).
 Ear.
Referral for Otologic          Pending NQF       No..................  AQC............  Claims, Registry.
 Evaluation for Patients with   review.
 History of Active Drainage
 from the Ear within the
 Previous 90 days.
Referral for Otologic          Pending NQF       No..................  AQC............  Claims, Registry.
 Evaluation for Patients with   review.
 a History of Sudden or
 Rapidly Progressive Hearing
 Loss within the Previous 90
 days.
Cataracts: 20/40 or Better     Pending NQF       Yes.................  American         Registry.
 Visual Acuity within 90 days   review.                                 Academy of
 Following Cataract Surgery.                                            Ophthalmology
                                                                        (AAO)/AMA-PCPI/
                                                                        NCQA.
Cataracts: Complications       Pending NQF       Yes.................  AAO/AMA-PCPI/    Registry.
 within 30 Days Following       review.                                 NCQA.
 Cataract Surgery Requiring
 Additional Surgical
 Procedures.
Perioperative Temperature      Yes.............  Yes.................  AMA-PCPI.......  Claims, Registry.
 Management.
Cancer Stage Documented......  Yes.............  Yes.................  AMA-PCPI.......  Claims, Registry.
Stenosis Measurement in        Yes.............  Yes.................  American         Claims, Registry.
 Carotid Imaging Studies.                                               College of
                                                                        Radiology
                                                                        (ACR)/AMA-PCPI/
                                                                        NCQA.
Coronary Artery Disease        Yes.............  No..................  ACC/AHA/AMA-     Registry.
 (CAD): Symptom and Activity                                            PCPI.
 Assessment.
Coronary Artery Disease        Yes.............  No..................  ACC/AHA/AMA-     Registry.
 (CAD): Drug Therapy for                                                PCPI.
 Lowering LDL-Cholesterol.
Heart Failure (HF): Left       Yes.............  No..................  ACC/AHA/AMA-     Registry.
 Ventricular Function                                                   PCPI.
 Assessment.
Heart Failure (HF): Patient    Yes.............  No..................  ACC/AHA/AMA-     Registry.
 Education.                                                             PCPI.
Heart Failure (HF): Warfarin   Yes.............  No..................  ACC/AHA/AMA-     Registry.
 Therapy Patients with Atrial                                           PCPI.
 Fibrillation.
Blood Pressure Management:     Yes.............  No..................  NCQA...........  Registry.
 Control.
Complete Lipid Profile.......  Yes.............  No..................  NCQA...........  Registry.
Cholesterol Count............  Yes.............  No..................  NCQA...........  Registry.
Use of Aspirin or Another      Yes.............  No..................  NCQA...........  Registry.
 Anti-Thrombotic.
HIV/AIDS: Sexually             Yes.............  No..................  AMA-PCPI/NCQA..  Registry.
 Transmitted Diseases--
 Chlamydia and Gonorrhea
 Screenings.
HIV/AIDS: Screening for High   Yes.............  No..................  AMA-PCPI/NCQA..  Registry.
 Risk Sexual Behaviors.
HIV/AIDS: Screening for        Yes.............  No..................  AMA-PCPI/NCQA..  Registry.
 Injection Drug Use.
HIV/AIDS: Sexually             Yes.............  No..................  AMA-PCPI/NCQA..  Registry.
 Transmitted Diseases--
 Syphilis Screening.
----------------------------------------------------------------------------------------------------------------


[[Page 33582]]

(4) Proposed 2010 Individual Quality Measures Available for EHR-Based 
Reporting
    As discussed in section II.G.2.d.(3) of this proposed rule, we 
propose to accept PQRI data from EHRs for a limited subset of the 
proposed 2010 PQRI quality measures, contingent upon the successful 
completion of our 2009 EHR data submission testing process and a 
determination that accepting data from EHRs on quality measures for the 
2010 PQRI is practical and feasible. The 10 proposed 2010 PQRI quality 
measures on which we propose to accept clinical quality data extracted 
from EHRs are identified in Table 20. We propose to make these measures 
available for electronic submission via an EHR because these measures 
target preventive care or common chronic conditions. In addition, 4 of 
these proposed measures overlap with measures used in the Medicare 
Quality Improvement Organization program's 9th Statement of Work. 
Finally, it is much less burdensome for an eligible professional to 
report Measure 124, which assesses adoption and use of EHRs, 
through an EHR than through claims.

                       Table 20--Proposed 2010 Measures Available for EHR-based Reporting
----------------------------------------------------------------------------------------------------------------
                                            NQF endorsement status    AQA adoption status as
   Measure number        Measure title           as of 5/1/09              of  1/31/09         Measure developer
----------------------------------------------------------------------------------------------------------------
1...................  Diabetes Mellitus:   Yes.....................  Yes....................  NCQA
                       Hemoglobin A1c
                       Poor Control in
                       Diabetes Mellitus.
2...................  Diabetes Mellitus:   Yes.....................  Yes....................  NCQA
                       Low Density
                       Lipoprotein (LDL-
                       C) Control in
                       Diabetes Mellitus.
3...................  Diabetes Mellitus:   Yes.....................  No.....................  NCQA
                       High Blood
                       Pressure Control
                       in Diabetes
                       Mellitus.
5...................  Heart Failure:       Yes.....................  Yes....................  AMA-PCPI
                       Angiotensin-
                       Converting Enzyme
                       (ACE) Inhibitor or
                       Angiotensin
                       Receptor Blocker
                       (ARB) Therapy for
                       Left Ventricular
                       Systolic
                       Dysfunction (LVSD).
7...................  Coronary Artery      Yes.....................  Yes....................  AMA-PCPI
                       Disease (CAD):
                       Beta-Blocker
                       Therapy for CAD
                       Patients with
                       Prior Myocardial
                       Infarction (MI).
110.................  Preventive Care and  Yes.....................  No.....................  AMA-PCPI
                       Screening:
                       Influenza
                       Immunization for
                       Patients >= 50
                       Years Old.
111.................  Preventive Care and  Yes.....................  Yes....................  NCQA
                       Screening:
                       Pneumonia
                       Vaccination for
                       Patients 65 Years
                       and Older.
112.................  Preventive Care and  Yes.....................  Yes....................  NCQA
                       Screening:
                       Screening
                       Mammography.
113.................  Preventive Care and  Yes.....................  Yes....................  NCQA
                       Screening:
                       Colorectal Cancer
                       Screening.
124.................  Health Information   Yes.....................  Yes....................  CMS/QIP
                       Technology (HIT):
                       Adoption/Use of
                       Electronic Health
                       Records (EHR).
----------------------------------------------------------------------------------------------------------------

(5) Measures Proposed for Inclusion in 2010 Measures Groups
    We propose to retain the 7 2009 PQRI measures groups for the 2010 
PQRI: (1) Diabetes Mellitus; (2) CKD; (3) Preventive Care; (4) CABG; 
(5) Rheumatoid Arthritis; (6) Perioperative Care; and (7) Back Pain. 
These measures groups were selected for inclusion in the 2010 PQRI 
because they each contain at least 4 PQRI quality measures that share a 
common denominator definition.
    Except for the CABG measures group, all 2009 measures groups are 
reportable either through claims-based reporting or registry-based 
reporting. The CABG measures group, for the 2009 PQRI, is reportable 
through the registry-based reporting mechanism only since some measures 
included in the 2009 CABG measures group are registry-only individual 
PQRI measures. For this reason, we propose the CABG measures group 
would be reportable through the registry-based reporting mechanism only 
for 2010 while the remaining 6 2009 PQRI measures groups would be 
reportable through either claims-based reporting or registry-based 
reporting for the 2010 PQRI.
    Except for the measures included in the Back Pain measures group, 
the measures included in a 2009 PQRI measures group are reportable 
either as individual measures or as part of a measures group. As stated 
in the CY 2009 PFS final rule with comment period (73 FR 69843 through 
69844), as individual measures, the measures in the Back Pain measures 
group are too basic. However, taken together they are meaningful 
indicators of quality of care for back pain. For this reason, for the 
2010 PQRI, we propose that except for the measures included in the Back 
Pain measures group, the measures included in a 2009 PQRI measures 
group that we propose to carry forward for the 2010 PQRI would be 
reportable either as individual measures or as part of a measures 
group.
    The measures proposed for inclusion in the 2010 measures groups 
that are based on the measures groups from 2009 are identified in 
Tables 21 through 27. Some measures proposed for inclusion in some of 
these measures groups for 2010 were not included in the measures groups 
in 2009. The 2009 measures proposed for inclusion in a 2010 measures 
group that were not included in the measures group for 2009 are 
identified with an asterisk (*).
    As with measures group reporting in the 2008 and 2009 PQRI, we 
propose that each eligible professional electing to report a group of 
measures for 2010 must report all measures in the group that are 
applicable to each patient or encounter to which the measures group 
applies at least up to the minimum number of patients required by 
applicable reporting criteria (described above in section II.G.2.f. of 
this proposed rule). The individual measures included in the final 2010 
PQRI measures groups will be limited to

[[Page 33583]]

those measures which will be identified in the CY 2010 PFS final rule 
with comment period as final 2010 PQRI measures

                      Table 21--Measures Proposed for 2010 Diabetes Mellitus Measures Group
----------------------------------------------------------------------------------------------------------------
                                            NQF endorsement status    AQA adoption status as
   Measure number        Measure title           as of 5/1/09              of  1/31/09         Measure developer
----------------------------------------------------------------------------------------------------------------
1...................  Diabetes Mellitus:   Yes.....................  Yes....................  NCQA.
                       Hemoglobin A1c
                       Poor Control in
                       Diabetes Mellitus.
2...................  Diabetes Mellitus:   Yes.....................  Yes....................  NCQA.
                       Low Density
                       Lipoprotein (LDL-
                       C) Control in
                       Diabetes Mellitus.
3...................  Diabetes Mellitus:   Yes.....................  No.....................  NCQA.
                       High Blood
                       Pressure Control
                       in Diabetes
                       Mellitus.
117.................  Diabetes Mellitus:   Yes.....................  Yes....................  NCQA.
                       Dilated Eye Exam
                       in Diabetic
                       Patient.
119.................  Diabetes Mellitus:   Yes.....................  No.....................  NCQA.
                       Urine Screening
                       for Microalbumin
                       or Medical
                       Attention for
                       Nephropathy in
                       Diabetic Patients.
163.................  Diabetes Mellitus:   Yes.....................  No.....................  NCQA.
                       Foot Exam *.
----------------------------------------------------------------------------------------------------------------
* This 2009 PQRI measure was not part of this measures group for 2009, but is proposed for inclusion in this
  measures group for 2010.


                             Table 22--Measures Proposed for 2010 CKD Measures Group
----------------------------------------------------------------------------------------------------------------
                                            NQF endorsement status    AQA adoption status as
   Measure number        Measure title           as of 5/1/09              of  1/31/09         Measure developer
----------------------------------------------------------------------------------------------------------------
121.................  Chronic Kidney       No......................  Yes....................  AMA-PCPI.
                       Disease (CKD):
                       Laboratory Testing
                       (Calcium,
                       Phosphorus, Intact
                       Parathyroid
                       Hormone (iPTH) and
                       Lipid Profile).
122.................  Chronic Kidney       No......................  Yes....................  AMA-PCPI.
                       Disease (CKD):
                       Blood Pressure
                       Management.
123.................  Chronic Kidney       No......................  Yes....................  AMA-PCPI.
                       Disease (CKD):
                       Plan of Care--
                       Elevated
                       Hemoglobin for
                       Patients Receiving
                       Erythropoiesis-
                       Stimulating Agents
                       (ESA).
135.................  Chronic Kidney       No......................  Yes....................  AMA-PCPI.
                       Disease (CKD):
                       Influenza
                       Immunization.
153.................  Chronic Kidney       No......................  Yes....................  AMA-PCPI.
                       Disease (CKD):
                       Referral for
                       Arteriovenous (AV)
                       Fistula.
----------------------------------------------------------------------------------------------------------------


                       Table 23--Measures Proposed for 2010 Preventive Care Measures Group
----------------------------------------------------------------------------------------------------------------
                                            NQF endorsement status    AQA adoption status as
   Measure number        Measure title           as of 5/1/09              of  1/31/09         Measure developer
----------------------------------------------------------------------------------------------------------------
39..................  Screening or         Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       Therapy for
                       Osteoporosis for
                       Women Aged 65
                       Years and Older.
48..................  Urinary              Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       Incontinence:
                       Assessment of
                       Presence or
                       Absence of Urinary
                       Incontinence in
                       Women Aged 65
                       Years and Older.
110.................  Preventive Care and  Yes.....................  No.....................  AMA-PCPI.
                       Screening:
                       Influenza
                       Immunization for
                       Patients >= 50
                       Years Old.
111.................  Preventive Care and  Yes.....................  Yes....................  NCQA.
                       Screening:
                       Pneumonia
                       Vaccination for
                       Patients 65 Years
                       and Older.
112.................  Preventive Care and  Yes.....................  Yes....................  NCQA.
                       Screening:
                       Screening
                       Mammography.
113.................  Preventive Care and  Yes.....................  Yes....................  NCQA.
                       Screening:
                       Colorectal Cancer
                       Screening.
114.................  Preventive Care and  Yes.....................  Yes....................  AMA-PCPI.
                       Screening: Inquiry
                       Regarding Tobacco
                       Use.
115.................  Preventive Care and  Yes.....................  Yes....................  NCQA.
                       Screening:
                       Advising Smokers
                       to Quit.
128.................  Preventive Care and  Yes.....................  Yes....................  CMS/QIP.
                       Screening: Body
                       Mass Index (BMI)
                       Screening and
                       Follow-Up.
173.................  Preventive Care and  No......................  Yes....................  AMA-PCPI.
                       Screening:
                       Unhealthy Alcohol
                       Use--Screening *.
----------------------------------------------------------------------------------------------------------------
* This 2009 PQRI measure was not part of this measures group for 2009, but is proposed for inclusion in this
  measures group for 2010.


[[Page 33584]]


                           Table 24--Measures Proposed for 2010 CABG Measures Group +
----------------------------------------------------------------------------------------------------------------
                                            NQF endorsement status    AQA adoption status as
   Measure number        Measure title           as of 5/1/09              of  1/31/09         Measure developer
----------------------------------------------------------------------------------------------------------------
43..................  Coronary Artery      Yes.....................  Yes....................  Society of
                       Bypass Graft                                                            Thoracic Surgeons
                       (CABG): Use of                                                          (STS).
                       Internal Mammary
                       Artery (IMA) in
                       Patients with
                       Isolated CABG
                       Surgery.
44..................  Coronary Artery      Yes.....................  Yes....................  STS.
                       Bypass Graft
                       (CABG):
                       Preoperative Beta-
                       Blocker in
                       Patients with
                       Isolated CABG
                       Surgery.
164.................  Coronary Artery      Yes.....................  Yes....................  STS.
                       Bypass Graft
                       (CABG): Prolonged
                       Intubation
                       (Ventilation).
165.................  Coronary Artery      Yes.....................  Yes....................  STS.
                       Bypass Graft
                       (CABG): Deep
                       Sternal Wound
                       Infection Rate.
166.................  Coronary Artery      Yes.....................  Yes....................  STS.
                       Bypass Graft
                       (CABG): Stroke/
                       Cerebrovascular
                       Accident (CVA).
167.................  Coronary Artery      Yes.....................  Yes....................  STS.
                       Bypass Graft
                       (CABG):
                       Postoperative
                       Renal
                       Insufficiency.
168.................  Coronary Artery      Yes.....................  Yes....................  STS.
                       Bypass Graft
                       (CABG): Surgical
                       Re-exploration.
169.................  Coronary Artery      Yes.....................  Yes....................  STS.
                       Bypass Graft
                       (CABG):
                       Antiplatelet
                       Medications at
                       Discharge.
170.................  Coronary Artery      Yes.....................  Yes....................  STS.
                       Bypass Graft
                       (CABG): Beta-
                       Blockers
                       Administered at
                       Discharge.
171.................  Coronary Artery      Yes.....................  Yes....................  STS.
                       Bypass Graft
                       (CABG): Lipid
                       Management and
                       Counseling.
----------------------------------------------------------------------------------------------------------------
+ This measures group is proposed to be reportable through registry-based reporting only.


                    Table 25--Measures Proposed for 2010 Rheumatoid Arthritis Measures Group
----------------------------------------------------------------------------------------------------------------
                                            NQF endorsement status    AQA adoption status as
   Measure number        Measure title           as of 5/1/09              of  1/31/09         Measure developer
----------------------------------------------------------------------------------------------------------------
108.................  Rheumatoid           Yes.....................  No.....................  NCQA.
                       Arthritis (RA):
                       Disease Modifying
                       Anti-Rheumatic
                       Drug (DMARD)
                       Therapy.
176.................  Rheumatoid           No......................  Yes....................  AMA-PCPI/NCQA.
                       Arthritis (RA):
                       Tuberculosis
                       Screening.
177.................  Rheumatoid           No......................  Yes....................  AMA-PCPI/NCQA.
                       Arthritis (RA):
                       Periodic
                       Assessment of
                       Disease Activity.
178.................  Rheumatoid           No......................  Yes....................  AMA-PCPI/NCQA.
                       Arthritis (RA):
                       Functional Status
                       Assessment.
179.................  Rheumatoid           No......................  Yes....................  AMA-PCPI/NCQA.
                       Arthritis (RA):
                       Assessment and
                       Classification of
                       Disease Prognosis.
180.................  Rheumatoid           No......................  Yes....................  AMA-PCPI/NCQA.
                       Arthritis (RA):
                       Glucocorticoid
                       Management.
----------------------------------------------------------------------------------------------------------------


                     Table 26--Measures Proposed for 2010 Perioperative Care Measures Group
----------------------------------------------------------------------------------------------------------------
                                            NQF endorsement status    AQA adoption status as
   Measure number        Measure title           as of 5/1/09              of  1/31/09         Measure developer
----------------------------------------------------------------------------------------------------------------
20..................  Perioperative Care:  Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       Timing of
                       Antibiotic
                       Prophylaxis--Order
                       ing Physician.
21..................  Perioperative Care:  Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       Selection of
                       Prophylactic
                       Antibiotic--First
                       OR Second
                       Generation
                       Cephalosporin.
22..................  Perioperative Care:  Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       Discontinuation of
                       Prophylactic
                       Antibiotics (Non-
                       Cardiac
                       Procedures).
23..................  Perioperative Care:  Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       Venous
                       Thromboembolism
                       (VTE) Prophylaxis
                       (When Indicated in
                       ALL Patients).
----------------------------------------------------------------------------------------------------------------


[[Page 33585]]


                          Table 27--Measures Proposed for 2010 Back Pain Measures Group
----------------------------------------------------------------------------------------------------------------
                                            NQF endorsement status    AQA adoption status as
   Measure number        Measure title           as of 5/1/09               of 1/31/09         Measure developer
----------------------------------------------------------------------------------------------------------------
148.................  Back Pain: Initial   Yes.....................  Yes....................  NCQA.
                       Visit.
149.................  Back Pain: Physical  Yes.....................  Yes....................  NCQA.
                       Exam.
150.................  Back Pain: Advice    Yes.....................  Yes....................  NCQA.
                       for Normal
                       Activities.
151.................  Back Pain: Advice    Yes.....................  Yes....................  NCQA.
                       Against Bed Rest.
----------------------------------------------------------------------------------------------------------------

    In addition to the 7 measures groups that we propose to retain from 
the 2009 PQRI, we propose 6 new measures groups for the 2010 PQRI, for 
a total of 13 CY 2010 measures groups. The 6 new measures groups 
proposed for the 2010 PQRI are: (1) Coronary Artery Disease (CAD); (2) 
Heart Failure (HF); (3) Ischemic Vascular Disease (IVD); (4) Hepatitis 
C; (5) Human Immunodeficiency Virus (HIV)/Acquired Immune Deficiency 
Syndrome (AIDS); and (6) Community Acquired Pneumonia (CAP). Many of 
the 6 new measures groups proposed for 2010 contain proposed new 
registry-only measures, which would make them reportable through 
registry-based reporting only. Therefore, only 8 proposed 2010 measures 
groups would be reportable through either claims-based reporting or 
registry-based reporting: Diabetes Mellitus; CKD; Preventive Care; 
Perioperative Care; Rheumatoid Arthritis; Back Pain; Hepatitis C; and 
Community Acquired Pneumonia. We invite comments on our proposal to 
limit claims-based reporting of measures groups in 2010.
    New measures groups are proposed for the 2010 PQRI in order to 
address gaps in quality reporting and are those that have a high impact 
on HHS and CMS priority topics for improved quality and efficiency for 
Medicare beneficiaries (such as prevention, chronic conditions, high 
cost/high volume conditions, improved care coordination, improved 
efficiency, improved patient and family experience of care, and 
effective management of acute and chronic episodes of care). Groups 
were identified in topical areas where: (1) 4 or more proposed 2010 
measures are available; (2) the measures are NQF endorsed; and (3) they 
address a gap in quality reporting. The measures proposed for inclusion 
in these new 2010 measures groups are identified in Tables 28 through 
33.
    Some measures proposed for inclusion in these 6 measures group are 
current 2009 individual PQRI measures. The title of each such measure 
is preceded with its PQRI Measure Number in Tables 28 through 33. As 
stated previously, the PQRI Measure Number is a unique identifier 
assigned by CMS to all measures in the PQRI measure set. Once a PQRI 
Measure Number is assigned to a measure, it will not be used again, 
even if the measure is subsequently retired from the PQRI measure set. 
Measures that are not preceded by a number (in other words, those 
preceded by ``TBD'') in Tables 28 through 33 have never been part of a 
PQRI measure set until being proposed now. A number will be assigned to 
such measures if we include them in the final set of 2010 PQRI measures 
groups.

                            Table 28--Measures Proposed for 2010 CAD Measures Group +
----------------------------------------------------------------------------------------------------------------
                                            NQF endorsement status    AQA adoption status as
   Measure number        Measure title           as of 5/1/09              of  1/31/09         Measure developer
----------------------------------------------------------------------------------------------------------------
6...................  Coronary Artery      Yes.....................  Yes....................  AMA-PCPI.
                       Disease (CAD):
                       Oral Antiplatelet
                       Therapy Prescribed
                       for Patients with
                       CAD.
114.................  Preventive Care and  Yes.....................  Yes....................  AMA-PCPI.
                       Screening: Inquiry
                       Regarding Tobacco
                       Use.
115.................  Preventive Care and  Yes.....................  Yes....................  NCQA.
                       Screening:
                       Advising Smokers
                       to Quit.
TBD.................  Coronary Artery      Yes.....................  Yes....................  ACC/AHA/AMA-PCPI.
                       Disease (CAD):
                       Symptom and
                       Activity
                       Assessment.
TBD.................  Coronary Artery      Yes.....................  Yes....................  ACC/AHA/AMA-PCPI.
                       Disease (CAD):
                       Drug Therapy for
                       Lowering LDL-
                       Cholesterol.
----------------------------------------------------------------------------------------------------------------
+ This measures group is proposed to be reportable through registry-based reporting only.


                            Table 29--Measures Proposed for 2010 HF Measures Group +
----------------------------------------------------------------------------------------------------------------
                                            NQF endorsement status    AQA adoption status as
   Measure number        Measure title           as of 5/1/09              of  1/31/09         Measure developer
----------------------------------------------------------------------------------------------------------------
5...................  Heart Failure:       Yes.....................  Yes....................  AMA-PCPI.
                       Angiotensin-
                       Converting Enzyme
                       (ACE) Inhibitor or
                       Angiotensin
                       Receptor Blocker
                       (ARB) Therapy for
                       Left Ventricular
                       Systolic
                       Dysfunction (LVSD).
8...................  Heart Failure: Beta- Yes.....................  Yes....................  AMA-PCPI.
                       Blocker Therapy
                       for Left
                       Ventricular
                       Systolic
                       Dysfunction (LVSD).
114.................  Preventive Care and  Yes.....................  Yes....................  AMA-PCPI.
                       Screening: Inquiry
                       Regarding Tobacco
                       Use.
115.................  Preventive Care and  Yes.....................  Yes....................  NCQA.
                       Screening:
                       Advising Smokers
                       to Quit.

[[Page 33586]]


TBD.................  Heart Failure (HF):  Yes.....................  Yes....................  ACC/AHA/AMA-PCPI.
                       Left Ventricular
                       Function
                       Assessment.
TBD.................  Heart Failure (HF):  Yes.....................  Yes....................  ACC/AHA/AMA-PCPI.
                       Patient Education.
TBD.................  Heart Failure (HF):  Yes.....................  Yes....................  ACC/AHA/AMA-PCPI.
                       Warfarin Therapy
                       Patients with
                       Atrial
                       Fibrillation.
----------------------------------------------------------------------------------------------------------------
+ This measures group is proposed to be reportable through registry-based reporting only.


                            Table 30--Measures Proposed for 2010 IVD Measures Group +
----------------------------------------------------------------------------------------------------------------
                                            NQF endorsement status    AQA adoption status as
   Measure number        Measure title           as of 5/1/09              of  1/31/09         Measure Developer
----------------------------------------------------------------------------------------------------------------
114.................  Preventive Care and  Yes.....................  Yes....................  AMA-PCPI.
                       Screening: Inquiry
                       Regarding Tobacco
                       Use.
115.................  Preventive Care and  Yes.....................  Yes....................  NCQA.
                       Screening:
                       Advising Smokers
                       to Quit.
TBD.................  Blood Pressure       Yes.....................  No.....................  NCQA.
                       Management:
                       Control.
TBD.................  Complete Lipid       Yes.....................  No.....................  NCQA.
                       Profile.
TBD.................  Cholesterol Control  Yes.....................  No.....................  NCQA.
TBD.................  Use of Aspirin or    Yes.....................  No.....................  NCQA.
                       Another Anti-
                       Thrombotic.
----------------------------------------------------------------------------------------------------------------
+ This measures group is proposed to be reportable through registry-based reporting only.


                         Table 31--Measures Proposed for 2010 Hepatitis C Measures Group
----------------------------------------------------------------------------------------------------------------
                                            NQF endorsement status    AQA adoption status as
     Measure No.         Measure title           as of 5/1/09              of  1/31/09         Measure developer
----------------------------------------------------------------------------------------------------------------
84..................  Hepatitis C:         Yes.....................  Yes....................  AMA-PCPI.
                       Ribonucleic Acid
                       (RNA) Testing
                       Before Initiating
                       Treatment.
85..................  Hepatitis C: HCV     Yes.....................  Yes....................  AMA-PCPI.
                       Genotype Testing
                       Prior to Treatment.
86..................  Hepatitis C:         Yes.....................  Yes....................  AMA-PCPI.
                       Antiviral
                       Treatment
                       Prescribed.
87..................  Hepatitis C: HCV     Yes.....................  Yes....................  AMA-PCPI.
                       Ribonucleic Acid
                       (RNA) Testing at
                       Week 12 of
                       Treatment.
89..................  Hepatitis C:         Yes.....................  Yes....................  AMA-PCPI.
                       Counseling
                       Regarding Risk of
                       Alcohol
                       Consumption.
90..................  Hepatitis C:         Yes.....................  Yes....................  AMA-PCPI.
                       Counseling
                       Regarding Use of
                       Contraception
                       Prior to Antiviral
                       Therapy.
183.................  Hepatitis C:         Yes.....................  Yes....................  AMA-PCPI.
                       Hepatitis A
                       Vaccination in
                       Patients with HCV.
184.................  Hepatitis C:         Yes.....................  Yes....................  AMA-PCPI.
                       Hepatitis B
                       Vaccination in
                       Patients with HCV.
----------------------------------------------------------------------------------------------------------------


                         Table 32--Measures Proposed for 2010 HIV/AIDS Measures Group +
----------------------------------------------------------------------------------------------------------------
                                            NQF endorsement status    AQA adoption status as
     Measure No.         Measure title           as of 5/1/09              of  1/31/09         Measure developer
----------------------------------------------------------------------------------------------------------------
159.................  HIV/AIDS: CD4+ Cell  Yes.....................  No.....................  AMA-PCPI/NCQA.
                       Count or CD4+
                       Percentage.
160.................  HIV/AIDS:            Yes.....................  No.....................  AMA-PCPI/NCQA.
                       Pneumocystis
                       Jiroveci Pneumonia
                       (PCP) Prophylaxis.
161.................  HIV/AIDS:            Yes.....................  No.....................  AMA-PCPI/NCQA.
                       Adolescent and
                       Adult Patients
                       with HIV/AIDS Who
                       Are Prescribed
                       Potent
                       Antiretroviral
                       Therapy.
162.................  HIV/AIDS: HIV RNA    Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       Control After Six
                       Months of Potent
                       Antiretroviral
                       Therapy.
TBD.................  HIV/AIDS: Sexually   Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       Transmitted
                       Diseases--Chlamydi
                       a and Gonorrhea
                       Screenings.
TBD.................  HIV/AIDS: Screening  Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       for High Risk
                       Sexual Behaviors.
TBD.................  HIV/AIDS: Screening  Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       for Injection Drug
                       Use.

[[Page 33587]]


TBD.................  HIV/AIDS: Sexually   Yes.....................  No.....................  AMA-PCPI/NCQA.
                       Transmitted
                       Diseases--Syphilis
                       Screening.
----------------------------------------------------------------------------------------------------------------
+ This measures group is proposed to be reportable through registry-based reporting only.


                Table 33--Measures Proposed for 2010 Community-Acquired Pneumonia Measures Group
----------------------------------------------------------------------------------------------------------------
                                            NQF endorsement status    AQA adoption status as
     Measure No.         Measure title           as of 5/1/09              of  1/31/09         Measure developer
----------------------------------------------------------------------------------------------------------------
56..................  Community-Acquired   Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       Pneumonia (CAP):
                       Vital Signs.
57..................  Community-Acquired   Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       Pneumonia (CAP):
                       Assessment of
                       Oxygen Saturation.
58..................  Community-Acquired   Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       Pneumonia (CAP):
                       Assessment of
                       Mental Status.
59..................  Community-Acquired   Yes.....................  Yes....................  AMA-PCPI/NCQA.
                       Pneumonia (CAP):
                       Empiric Antibiotic.
----------------------------------------------------------------------------------------------------------------

    We note that the specifications for measures groups do not 
necessarily contain all the specification elements of each individual 
measure making up the measures group. This is based on the need for a 
common set of denominator specifications for all the measures making up 
a measures group in order to define the applicability of the measures 
group. Therefore, the specifications and instructions for measures 
groups will be provided separately from the specifications and 
instructions for the individual 2010 PQRI measures. We will post the 
detailed specifications and specific instructions for reporting 
measures groups on the PQRI section of the CMS Web site at http://
www.cms.hhs.gov/PQRI by no later than December 31, 2008.
    Additionally, the detailed measure specifications and instructions 
for submitting data on those proposed 2010 measures groups that were 
also included as 2009 PQRI measures groups may be updated or modified 
prior to 2010. Therefore, the 2010 PQRI measure specifications for any 
given measures group could be different from specifications and 
submission instructions for the same measures group used for 2009. 
These measure specification changes do not materially impact the 
intended meaning of the measures or the strength of the measures.
(6) Request for Public Comment on Measure Suggestions for Future PQRI 
Quality Measure Sets
    As stated above, on February 1, 2009, we posted a ``Call for 2010 
PQRI Measure Suggestions'' on the PQRI section of the CMS Web site at 
http://www.cms.hhs.gov/PQRI. The ``Call for 2010 PQRI Measure 
Suggestions'' invited the public to submit suggestions for individual 
quality measures and measures groups (that is, suggestions for new 
measures groups and/or suggestions for the composition of existing 
measures groups) for consideration for possible inclusion in the 
proposed set of quality measure for use in the 2010 PQRI. To facilitate 
our evaluation of the suggested measures, we asked individuals or 
organizations submitting suggestions to provide us with the following 
information:
     Requestor contact information, such as name and title, 
organization/practice name, phone number and e-mail address;
     Measure title;
     Measure description;
     Measure owner/developer;
     NQF endorsement status, including the date of endorsement 
or anticipated endorsement (if not NQF-endorsed) and type of 
endorsement (for example, time-limited endorsement);
     AQA adoption status, including date of AQA adoption or 
anticipated AQA adoption;
     Preferred PQRI reporting option for the suggested 
measure(s) (that is, claims, registry, registry-only, measures group, 
measures group only, EHRs); and
     The measure specifications.
    In lieu of posting a call for 2011 PQRI measure suggestions on the 
PQRI section of the CMS Web site in 2010, we invite commenters to 
submit suggestions for individual quality measures and measures groups 
(that is, suggestions for new measures groups and/or suggestions for 
the composition of proposed 2010 measures groups) for consideration for 
possible inclusion in the proposed set of quality measures for use in 
the 2011 PQRI. When submitting suggestions for future PQRI quality 
measure sets as part of the comment period for this proposed rule, 
commenters should submit all the information requested above for the 
``Call for 2010 PQRI Measure Suggestions.''
    Please note that suggesting individual measures or measures for a 
new or proposed measures group does not mean that the measure(s) will 
be included in the proposed or final sets of measures of any proposed 
or final rules that address the 2011 PQRI. We will determine what 
individual measures and measures group(s) to include in the proposed 
set of quality measures, and after a period of public comment, we will 
make the final determination with regard to the final set of quality 
measures for the 2011 PQRI.
j. Proposed 2010 PQRI Quality Measures for Physician Groups Selected to 
Participate in the Group Practice Reporting Option
    As discussed in section II.G.2.g. of this proposed rule, we propose 
that physician groups selected to participate in the 2010 PQRI group 
practice reporting option would be required to report on 26 measures. 
These measures are NQF-endorsed measures currently collected as part of 
the PGP and/or MCMP demonstrations and are identified in Table 34. To 
the extent that a measure is an existing PQRI measure, the Measure 
Title is preceded by the measure's PQRI Measure Number. If there is no 
number in the Measure Number column of the table, then the

[[Page 33588]]

measure is not an existing PQRI measure and will be added to the 2010 
PQRI for purposes of the group practice reporting option.

 Table 34--Measures Proposed for Physician Groups Participating in the 2010 PQRI Group Practice Reporting Option
----------------------------------------------------------------------------------------------------------------
                                            NQF endorsement status    AQA adoption status as
     Measure No.         Measure title           as of 5/1/09              of  1/31/09         Measure developer
----------------------------------------------------------------------------------------------------------------
1...................  Diabetes Mellitus:   Yes.....................  Yes....................  NCQA.
                       Hemoglobin A1c
                       Poor Control.
2...................  Diabetes Mellitus:   Yes.....................  Yes....................  NCQA.
                       Low Density
                       Lipoprotein
                       Control.
3...................  Diabetes Mellitus:   Yes.....................  No.....................  NCQA.
                       High Blood
                       Pressure Control.
5...................  Heart Failure: ACE   Yes.....................  Yes....................  AMA-PCPI.
                       Inhibitor or ARB
                       Therapy for LVSD.
6...................  Coronary Artery      Yes.....................  Yes....................  AMA-PCPI.
                       Disease: Oral Anti-
                       platelet Therapy.
7...................  Coronary Artery      Yes.....................  Yes....................  AMA-PCPI.
                       Disease:Beta-
                       blocker Therapy
                       for CAD Patients
                       with Prior MI.
8...................  Heart Failure: Beta- Yes.....................  Yes....................  AMA-PCPI.
                       blocker Therapy
                       for LVSD.
110.................  Preventive Care:     Yes.....................  No.....................  AMA-PCPI.
                       Influenza
                       Vaccination for
                       Patients > 50
                       years.
111.................  Preventive Care:     Yes.....................  Yes....................  NCQA.
                       Pneumonia
                       Vaccination for
                       Patients 65+ years.
112.................  Preventive Care:     Yes.....................  Yes....................  NCQA.
                       Screening
                       Mammography.
113.................  Preventive Care:     Yes.....................  Yes....................  NCQA/AMA-PCPI.
                       Screening
                       Colorectal Cancer.
117.................  Diabetes Mellitus:   Yes.....................  Yes....................  NCQA.
                       Dilated Eye Exam.
118.................  Coronary Artery      Yes.....................  No.....................  AMA-PCPI.
                       Disease: ACE/ARB
                       for Patients with
                       CAD and Diabetes
                       and/or LVSD.
119.................  Diabetes Mellitus:   Yes.....................  No.....................  NCQA.
                       Urine Screening
                       for Microalbumin
                       or Medical
                       Attention for
                       Nephropathy.
163.................  Diabetes Mellitus:   Yes.....................  No.....................  NCQA.
                       Foot Exam.
TBD.................  Diabetes Mellitus:   Yes.....................  No.....................  NCQA.
                       Hemoglobin A1c
                       Testing.
TBD.................  Diabetes Mellitus:   Yes.....................  No.....................  NCQA.
                       Lipid Profile.
TBD.................  Heart Failure: Left  Yes.....................  Yes....................  CMS.
                       Ventricular
                       Function Testing.
TBD.................  Heart Failure: Left  Yes.....................  Yes....................  ACC/AHA/AMA-PCPI.
                       Ventricular
                       Function
                       Assessment.
TBD.................  Heart Failure:       Yes.....................  No.....................  ACC/AHA/AMA-PCPI.
                       Weight Measurement.
TBD.................  Heart Failure:       Yes.....................  Yes....................  ACC/AHA/AMA-PCPI.
                       Patient Education.
TBD.................  Heart Failure:       Yes.....................  Yes....................  ACC/AHA/AMA-PCPI.
                       Warfarin Therapy
                       for Patients with
                       Atrial
                       Fibrillation.
TBD.................  Coronary Artery      Yes.....................  Yes....................  ACC/AHA/AMA-PCPI.
                       Disease: Drug
                       Therapy for
                       Lowering LDL-
                       Cholesterol.
TBD.................  Preventive Care:     Yes.....................  No.....................  ACC/AHA/AMA-PCPI.
                       Blood Pressure
                       Management.
TBD.................  Hypertension: Blood  Yes.....................  No.....................  CMS/NCQA.
                       Pressure Control.
TBD.................  Hypertension: Plan   Yes.....................  No.....................  ACC/AHA/AMA-PCPI.
                       of Care.
----------------------------------------------------------------------------------------------------------------

k. Public Reporting of PQRI Data
    Section 1848(m)(5)(G) of the Act, as added by the MIPPA, requires 
the Secretary to post on the CMS Web site, in an easily understandable 
format, a list of the names of eligible professionals (or group 
practices) who satisfactorily submitted data on quality measures for 
the PQRI and the names of the eligible professionals (or group 
practices) who are successful electronic prescribers as defined and 
discussed further in section II.G.5. of this proposed rule. In 
accordance with section 1848(m)(5)(G) of the Act, we indicated in the 
CY 2009 PFS final rule with comment period (73 FR 69846 through 69847) 
our intent, in 2010, to enhance the current Physician and Other Health 
Care Professionals directory at http://www.medicare.gov with the names 
of eligible professionals that satisfactorily submit quality data for 
the 2009 PQRI. In December 2008, we listed, by State, the names of 
eligible professionals who participated in the 2007 PQRI on the 
Physician and Other Health Care Professionals Directory.
    As required by section 1848(m)(5)(G) of the Act, we intend to make 
public the names of eligible professionals and group practices that 
satisfactorily submit quality data for the 2010 PQRI on the Physician 
and Other Health Care Professionals Directory. We anticipate that the 
names of individual eligible professionals and group practices that 
satisfactorily submit quality data for the 2010 PQRI will be available 
in 2011 after the 2010 incentive payments are paid.
    For purposes of publicly reporting the names of eligible 
professionals, on the Physician and Other Health Care Professionals 
Directory, we propose to post the names of eligible professionals who: 
(1) Submit data on the 2010 PQRI quality measures through one of the

[[Page 33589]]

reporting mechanisms available for the 2010 PQRI; (2) meet one of the 
proposed satisfactory reporting criteria of individual measures or 
measures groups for the 2010 PQRI described above in section II.G.2.e. 
and II.G.2.f., respectively of this proposed rule; and (3) qualify to 
earn a PQRI incentive payment for covered professional services 
furnished during the applicable 2010 PQRI reporting period.
    Similarly, for purposes of publicly reporting the names of group 
practices, on the Physician and Other Health Care Professionals 
Directory, we propose to post the names of group practices who: (1) 
Submit data on the 2010 PQRI quality measures through the proposed 
group practice reporting option described in section II.G.2.g. of this 
proposed rule; (2) meet the proposed criteria for satisfactory 
reporting under the group practice reporting option; and (3) qualify to 
earn a PQRI incentive payment for covered professional services 
furnished during the applicable 2010 PQRI reporting period for group 
practices.
    In addition to posting the information required by section 
1848(m)(5)(G) of the Act, for those group practices that are selected 
to participate in PQRI under the group practice reporting option, we 
also propose to make the group practices' PQRI performance rates 
publicly available, for each of the measures. As we stated in the CY 
2009 PFS proposed rule (73 FR 38574 through 38575), it is our goal to 
make the quality of care for services furnished to Medicare 
beneficiaries publicly available by making physician quality measure 
performance rates, either at the individual practitioner level or 
physician group level, publicly available. While we currently have Web 
pages at http://www.medicare.gov for the public reporting of 
performance results on standardized quality measures for hospitals 
(Hospital Compare), dialysis facilities (Dialysis Facility Compare), 
nursing homes (Nursing Home Compare), and home health facilities (Home 
Health Compare), we do not have a similar Compare Web site for 
information on the quality of care for services furnished by physicians 
and other professionals to Medicare beneficiaries.
    Public reporting of group practices' PQRI performance results at 
the group practice level would allow us to move toward our goal of 
making information on physician performance publicly available. We 
believe that the way we have proposed to design the group practice 
reporting option (see section II.G.2.g. of this proposed rule) 
facilitates public reporting of the groups' performance results. Group 
practices participating in the group practice reporting option would 
have already agreed in advance to have their performance results 
publicly reported. All groups participating in the group practice 
reporting option would be reporting on identical measures, which 
facilitate comparison of the results across groups. In addition, as a 
result of the proposed reporting criteria, no performance results would 
be calculated based on small denominator sizes. Finally, because we 
intend to modify the data collection tool will provide each group 
practice with numerator, denominator, and performance rates for each 
measure at the time of tool submission, the group practice will have 
had an opportunity to review their performance results before they are 
made public.
    In making performance rates for group practices publicly available, 
we will attribute the group practice's performance to the entire group. 
We will not post information with respect to the performance of 
individual physicians or other eligible professionals associated with 
the group. However, we may identify the individual eligible 
professionals who were associated with the group during the reporting 
period. We invite comments regarding our proposal to publicly report 
group practices' PQRI performance results.
3. Section 131(c): Physician Resource Use Measurement and Reporting 
Program
a. Statutory Authority
    As required under section 1848(n) of the Act, as added by section 
131(c) of the MIPPA, we established and implemented by January 1, 2009, 
a Physician Feedback Program using Medicare claims data and other data 
to provide confidential feedback reports to physicians (and as 
determined appropriate by the Secretary, to groups of physicians) that 
measure the resources involved in furnishing care to Medicare 
beneficiaries. Section 1848(n) of the Act authorizes us, as we 
determine appropriate, to include information on the quality of care 
furnished to Medicare beneficiaries by the physician (or group of 
physicians) in the reports. Although we initially called this effort 
the Physician Resource Use Feedback Program, we are renaming this 
initiative the ``Physician Resource Use Measurement and Reporting 
Program'' (hereinafter referred to as ``Program'').
b. Background
    As we stated in the CY 2009 PFS final rule with comment period (73 
FR 69866), the Program would consist of multiple phases. We included a 
summary of the activities of phase I of the Program in the CY 2009 PFS 
final rule with comment period (73 FR 69866 through 69869). In addition 
to discussing phase I of the Program, we also highlighted the 
activities of several other initiatives, including Medicare Value-Based 
Purchasing (VBP) programs and demonstrations and related activities 
undertaken by the MedPAC and the Government Accountability Office 
(GAO). We refer readers to the CY 2009 PFS final rule with comment 
period (73 FR 69866 through 69869) for a detailed discussion of these 
activities.
    In the CY 2009 PFS final rule with comment period (73 FR 69866 
through 69869), we finalized, on an interim basis, the following 
parameters for phase I of the Program: (1) Use of both per capita and 
episode of care methodologies for resource use measurement; (2) cost of 
service category analysis (for example, imaging services or inpatient 
admissions); (3) use of 4 calendar years of claims data; (4) focus on 
high cost and/or high volume conditions; (5) reporting to physician 
specialties relevant to the selected focal conditions; (6) focus on 
physicians practicing in certain geographic areas, and (7) low, median, 
and high cost benchmarks. We intend to finalize these parameters in the 
CY 2010 PFS final rule with comment period.
c. Summary of Comments From the CY 2009 PFS Final Rule With Comment 
Period
    Section 1848(n)(1)(B) of the Act requires that the Program measures 
resources based on the following: (1) An episode basis; (2) a per 
capita basis; or (3) both an episode and a per capita basis. We 
solicited public comments on the use of each of these measurement 
methodologies (73 FR 69868).
    Comment: Commenters were in favor of using both the per capita and 
the per episode measurement methodologies.
    Response: We agree with commenters that both the per capita and per 
episode methodologies are appropriate measures of cost for the Program. 
Each methodology offers distinct advantages. For a further discussion 
regarding the advantages, we refer readers to CMS' Medicare Resource 
Use Measurement Plan Web site at http://www.cms.hhs.gov/
QualityInitiativesGenInfo/downloads/ResourceUse_Roadmap_OEA_1-15_
508.pdf. We intend to finalize both

[[Page 33590]]

methodologies as options for use in future phases of the Program in the 
CY 2010 PFS final rule with comment period.
    In phase I of the Program, we included cost of service (COS) 
category information from aggregated Medicare FFS claims data. We 
solicited public comment on which COS categories are most meaningful 
and actionable (73 FR 69868).
    Comment: Commenters were overwhelmingly in favor of including E/M 
services and imaging services as meaningful and actionable COS 
categories. Further, commenters supported including laboratory 
services, outpatient services, procedures, and post-acute services as 
COS categories. No commenters raised specific categories that should be 
excluded.
    Response: We appreciate the comments in support of the COS category 
analysis. We intend to finalize the option to include information on 
all of these COS categories in future phases of the Program in the CY 
2010 PFS final rule with comment period.
    Section 1848(n)(3) of the Act requires that, to the extent 
practicable, the data for the reports shall be based on the most recent 
data available. In phase I of the Physician Resource Use Feedback 
Program, we used Medicare FFS claims data from CY 2004 through CY 2007. 
We solicited public comment on this approach (73 FR 69868).
    Comment: The majority of commenters stated that 3 calendar years of 
data is sufficient for calculating resource use measures. Further, 
commenters emphasized, to the extent practicable, CMS should use the 
most recent three years of data available for the Program.
    Response: We agree with commenters that 3 years of Medicare FFS 
claims data are sufficient for calculating resource use measures. We 
intend to finalize the use of the most recent 3 years of data available 
for the Program in the CY 2010 PFS final rule with comment period.
    Under section 1848(n)(4)(B) of the Act, the Secretary may focus the 
Program as appropriate, including focusing on physicians who treat 
conditions that are high cost, high volume, or both. We finalized on an 
interim basis for phase I of the Program, the following conditions: (1) 
Congestive heart failure; (2) chronic obstructive pulmonary disease; 
(3) prostate cancer; (4) cholecystitis; (5) coronary artery disease 
with acute myocardial infarction; (6) hip fracture; (7) community-
acquired pneumonia; and (8) urinary tract infection (73 FR 69868). We 
solicited public comments on the use of these high cost/high volume 
conditions (73 FR 69868).
    Comment: Commenters strongly supported these conditions as 
appropriate for measuring the resources furnished to Medicare 
beneficiaries. In addition, several commenters suggested that we 
include diabetes among the priority conditions for the Program.
    Response: We agree with commenters that diabetes is an important 
condition to capture in the Program. We intend to finalize the option 
to include: (1) Congestive heart failure; (2) chronic obstructive 
pulmonary disease; (3) prostate cancer; (4) cholecystitis; (5) coronary 
artery disease with acute myocardial infarction; (6) hip fracture; (7) 
community-acquired pneumonia; (8) urinary tract infection; and (9) 
diabetes, in the Program in the CY 2010 PFS final rule with comment 
period.
    Under section 1848(n)(4)(A) of the Act, we are permitted to focus 
reporting on physician specialties that account for a certain 
percentage of spending for physicians' services. Based on the high cost 
and high volume conditions selected above, we included the following 
physician specialties in phase I of the Program: General internal 
medicine, family practice, gastroenterology, cardiology, general 
surgery, infectious disease, neurology, orthopedic surgery, physical 
medicine and rehabilitation, pulmonology, and urology (73 FR 69868). We 
solicited public comments on the inclusion of these physician 
specialties (73 FR 69868).
    Comment: Commenters supported including all of the physician 
specialties listed above as appropriate for measurement and reporting 
based on the selected conditions.
    Response: We agree with commenters that the physician specialties 
listed above should be included in the Program. We intend to finalize 
the option to include these physician specialties in the Program in the 
CY 2010 PFS final rule with comment period.
    Section 1848(n)(4)(D) of the Act permits us to focus the Program on 
physicians practicing in certain geographic areas. In the CY 2009 PFS 
final rule with comment period (73 FR 69866 through 69869) we 
referenced two geographic sites (Baltimore, MD and Boston, MA) for 
phase I of the Program, which we generally selected based on close 
proximity to the CMS central office and due to high per capita Medicare 
costs, respectively. Since the final rule was published, we have also 
mailed reports to physicians in the following sites:
     Greenville, SC;
     Indianapolis, IN;
     Northern New Jersey;
     Orange County, CA;
     Seattle, WA;
     Syracuse, NY;
     Boston, MA;
     Cleveland, OH;
     East Lansing, MI;
     Little Rock, AR;
     Miami, FL; and
     Phoenix, AZ.
    Comment: Commenters were in favor of including a limited number of 
sites representing a wide range of geographic locations to facilitate a 
phased implementation. No commenters submitted specific areas that 
should be excluded.
    Response: We appreciate the comments in support of including a 
limited number of sites. We intend to