RICHARD G. COWART

The issue of pay for performance remains an area of active debate.

Health policy makers in Washington want physicians to provide some quality reporting and participation in order to get a raise. Organized medicine has been resistant, fearing the regulatory tentacles of Big Brother. The tensions on the fault line increased in April with the posting of quality reporting measures for physicians to voluntarily submit in order to receive bonus payments.

The Centers for Medicare and Medicaid Services (CMS) has posted specifications for measures included in the 2007 Physician Quality Reporting Initiative (PQRI). PQRI establishes a financial incentive for physicians and other health practitioners to participate in a voluntary quality reporting program. Eligible professionals who successfully report data for a designated set of quality measures may earn a bonus payment of 1.5 percent of total allowed charges for covered Medicare Physician Fee Schedule services provided during the reporting period of July 1, 2007, to Dec. 31, 2007. The specifics are as follows:

Eligibility and Reporting. No registration is required, and all Medicare-enrolled eligible professionals may participate in the PQRI, regardless of whether they have signed a Medicare participation agreement to accept assignment on all claims. Specifically, the physicians who are eligible to participate include: doctor of medicine, doctor of osteopathy, doctor of podiatric medicine, doctor of optometry, doctor of oral surgery, doctor of dental medicine and chiropractor.

Others practitioners are also eligible, including physician assistants, nurse practitioners, clinical psychologists, and physical therapists.

The 74 PQRI quality measures are posted at www.cms.gov/PQRI. Reporting will be claims-based using CPT® Category II codes for reporting quality data, and may be reported on paper-based CMS-1500 claims or electronic 837-P claims. PQRI quality data will not be publicly reported, but confidential feedback reports will be available near the time of the bonus payments in 2008. These feedback reports are expected to include reporting and performance rates.

CMS will determine successful reporting through the application of certain thresholds. CMS is currently working to establish how such thresholds will be verified.

Bonus Payments. Participating professionals who successfully report may earn a 1.5 percent bonus, calculated based on total allowed charges during the reporting period for professional services billed under the Physician Fee Schedule. Bonus payments will be made to the holder of record of the Taxpayer Identification Number in a lump sum in mid-2008. A cap may apply when few instances of quality measures are reported, which will be based on a formula that encourages increased reporting.

Since the reporting period is scheduled will begin July 1, interested professionals should review their practices in light of the reporting measures and determine their potential for bonus payments.

It will be interesting to see how many physicians are willing to voluntarily participate in order to receive the bonus payments.



Richard G. Cowart is chairman of the health law/public policy department of Baker, Donelson, Bearman, Caldwell & Berkowitz. He can be reached via
dcowart@bakerdonelson.com.


May 2007