Many have called the law (HR 2) that replaced Medicare’s sustainable growth rate formula a “permanent doc fix,” but that sells short many other types of providers who are affected by the legislation — providers critical to ensuring that beneficiaries have timely access to care.

Officials representing several California provider groups — including psychologists, physical therapists, nurse practitioners and physician assistants — say the new law will make it easier for Californians to get care.

The SGR “has been a thorn in everyone’s side for a number of years,” said Jo Linder-Crow, CEO of the California Psychological Association. All providers paid under Medicare’s physician fee schedule have repeatedly faced potential rate cuts under the formula, including:

• Clinical social workers;
• Diagnostic testing facility workers;
• Nurse practitioners;
• Physical therapists;
• Physicians;
• Physician assistants; and
• Psychologists.

After 17 temporary patches — over more than a decade — to the SGR formula staved off scheduled pay cuts, many providers were happy to see Congress finally scrap it last month. In doing so, lawmakers prevented a roughly 21% reduction in Medicare reimbursement rates from taking effect.

“Each period where the SGR was going to kick in, we went into limbo with our patients,” explained Rick Katz, chair of the California Physical Therapy Association’s Payment Policy Committee. He said that created a situation where physical therapists were unsure “whether or not the services would be covered.” That led to providers having to inform patients that they might have “issues with payment” that could “impact their care and their access to care,” Katz said.

The added stability under the new law — which will provide a 0.5% annual payment increase through 2019 for Medicare providers and then transition to a two-tier payment system designed to encourage participation in alternative payment models — is a “major win” that could encourage more psychologists to “stay with the Medicare system,” Linder-Crow said.

The SGR replacement measure not only affects how providers are paid by Medicare, but also the ability of some non-doctor providers to order oxygen equipment, walkers, blood sugar monitors and other durable medical equipment for beneficiaries without a physician’s signature.

That original requirement came about under a provision of the Affordable Care Act in an effort to stem fraud and abuse, according to Michael Powe, vice president of reimbursement and professional advocacy for the American Academy of Physician Assistants. It required:

• Health care professionals to have a face-to-face visit with Medicare beneficiaries before ordering DME for them; and
• Physicians to document that a face-to-face visit had occurred.

While Medicare has temporarily delayed the documentation requirement, it told DME suppliers who were already requiring a doctor’s signature to continue doing so, according to Powe.

That could lead to a delay of “up to several weeks” between a non-physician provider seeing a patient who needed DME and “getting someone to actually sign a piece of paper,” sometimes for a beneficiary whom a doctor has “never seen,” said Donna Emanuele, president of the California Association for Nurse Practitioners.

However, under the new law, physician assistants and nurse practitioners are now authorized to document evaluations for DME, lifting the barriers “in terms of access and the timeliness of care being provided” to beneficiaries, Powe said.

The SGR replacement measure also extended through the end of 2017 a process for physical therapists to receive exceptions to a dollar cap on the amount of outpatient therapy Medicare will pay for. The process lets physical therapists receive exceptions to the cap based on medical necessity, allowing them to continue being reimbursed for outpatient services.

Katz said that will help more beneficiaries “reach their fully functional level of improvement that they expect to achieve.”

Physical therapists fought to completely repeal the cap, which Katz said makes “the expectation of getting the patient to their prior level of function” potentially an unrealistic goal based on the patient’s level of need. He added that while the exception process is not ideal and still leaves open the possibility of a claim being denied, it will help beneficiaries far more than having no exception process at all.

Several leaders of provider groups noted that the SGR replacement legislation will accelerate the move toward alternative payment systems and integrated care models.

That will help move the health system toward one that is “not so focused on the volume or the intensity of service of care that is provided” and instead “is really focused on the value and outcomes of care delivery,” said Emanuele. She noted that the legislation further promotes that shift by ensuring that nurse practitioner-led patient-centered medical homes are eligible to receive Medicare incentive payments for the management of beneficiaries with chronic conditions.

Overall, providers said the new law will be a boon for California beneficiaries. Emanuele said the measure “cements in place roles for the health care providers … to really extend that level of access that’s needed across our populations, especially here in California, because there are just huge hubs in our rural communities, in our urban centers, in our inner-cities that are going without access to care when that doesn’t have to be the case.”