Incentive programs yield mixed results for expectant internists

Incentive payments from the federal government have been a mixed bag for internists, offering more reimbursement for Medicare patients, but not as much as physicians expected. While the extra income may seem underwhelming, it's still extra money, and it's going to increase as each program continues.

The Centers for Medicare and Medicaid Services (CMS) provides incentive payments to physicians and some nonphysician providers who successfully participate in its Physician Quality Reporting System (PQRS), in electronic prescribing (e-prescribing) and in the Primary Care Incentive Program (PCIP). These incentive programs allow physicians to receive bonus payments for successfully reporting on quality measures for services furnished to beneficiaries, generating electronic prescription orders, and providing designated primary care services over the course of the programs' respective reporting periods.

To illustrate how and where the payments are being made, the agency has released 2009 and early 2010 statistical reports on PQRS and the e-prescribing program. And although the agency has not released statistical results for the PCIP, ACP has received feedback and comments from its members on those bonus payments.

Physician Quality Reporting System

PQRS (originally the Physician Quality Reporting Initiative) began as a voluntary reporting program in 2007 that provided an incentive payment to identified eligible professionals who satisfactorily reported data on specific quality measures for covered professional services furnished to Medicare Part B fee-for-service beneficiaries and paid under the Medicare Physician Fee Schedule. The program was first implemented in 2007. For 2011, participants may earn an incentive payment of 1% of their estimated total allowed charges for covered professional services under Medicare Part B provided during the reporting period.

In terms of the number of participants, physicians and nonphysician practitioners in family practice (15,753), internal medicine (13,864), and cardiology (6,132) were the top specialties using the claims-based individual measures, claims-based measures groups, and registry reporting.

The PQRS program participation, among all specialties, has increased significantly since it began in 2007:

• 2007 had 98,698 participants,
• 2008 had 164,828 participants,
• 2009 had 221,858 participants and
• 2010 had 208,418 participants (this figure does not include registry data).

CMS did not produce a full report on the 2008 PQRI program results. However, the agency did provide a summary of the 2008 incentive payments. More than 162,800 professionals participated in the 2008 PQRI, with incentive payments made to more than 85,000 physicians and nonphysician providers who satisfactorily reported quality-related data to Medicare. The total payments exceeded $92 million, compared to $36 million in 2007. The average incentive amount for individual professionals is about $1,000.

The 2009 PQRS program had 210,000 participating eligible professionals in all specialties. Among those who participated, 120,000 earned incentive payments totaling more than $234 million. The average incentive amount was $2,000 for individual eligible professionals and $18,500 for practices.

CMS provides separate data for medical specialties. Among the 2009 PQRS incentive payments to internal medicine:

• The smallest incentive bonus paid was 72 cents;
• The largest bonus paid was $25,613;
• The median bonus paid was $1,333; and
• The total was nearly $22 million (9.3% of the national total).

PQRS offers various reporting methods to eligible professionals; the table below outlines the high-level performance of internists in the program.

Although the registry reporting method demonstrates itself as the most effective way to report, the most common submission method remains the claims-based reporting for individual measures. To illustrate the effectiveness of registry reporting, consider that 69 registries submitted data for about 15% of the participating professionals (all specialties); the remaining 85% of data was submitted by one of the claims-based methods. And 90% of those who used registry reporting earned an incentive. A table of participation and success rates is here.

Electronic prescribing

This program has been in place since 2009; during its first two years it was a component of the PQRS. In 2011, CMS separated it to become a free-standing program. During its existence, its participation rates have skyrocketed, although the overall success rate has remained steady at 57%. In 2009, e-prescribing had 89,752 participants; 48,354 (54%) earned incentives. By comparison, in 2010, e-prescribing had 100,444 participants in all specialties (does not include registry data).

The 2009 e-prescribing total incentive payments were more than $148 million. The average 2009 e-prescribing incentive payment to individual eligible professionals was $3,000; the average incentive payment to practices was $14,500.

Among internists in the 2009 e-prescribing program:

• Nationwide, 76,929 internists were eligible to participate in 2009 e-prescribing;
• 13,864 (18%) of the eligible internists did participate in 2009 e-prescribing;
• 7,320 (52.8%) of the participating internists earned an incentive;
• The smallest incentive bonus was $0.99;
• The largest incentive bonus was $42,000;
• The median incentive bonus was $1,941;
• The total e-prescribing incentive bonuses to internists were more than $19 million (13% of the national total).

Primary Care Incentive Program

Implemented as part of the Affordable Care Act, the primary care incentive payment (PCIP) bonuses allow primary care physicians to receive a 10% increase in their Medicare payments for certain primary care services rendered during years 2011 to 2015. To qualify for the bonus, a physician must designate himself or herself in a primary care specialty (general internal medicine, family practice, pediatrics or geriatrics). Plus, 60% of the physician's Medicare Part B claims must be for the primary care services designated by a specific list of CPT codes.

During development of the federal rule on the bonuses, ACP successfully advocated to ensure more internists would qualify for bonuses by excluding certain services (observation care services, inpatient hospital care services, hospital discharge services, same-date observation or hospital admission and discharge services and emergency department services) from the 60% calculation.

ACP has heard from a number of its members who reported that the 2011 first-quarter PCIP payments were not as large as were expected. There are several administrative reasons that the payment amounts did not meet expectations: the checks don't represent a full three months of Medicare claims, and many beneficiaries' annual deductibles were still being removed from the payment formula. In addition, the ambiguous ways in which CMS worded its incentive calculation caused some to overestimate what the amount of the first payments would be.

Regarding three months of claims, consider the usual time it takes for the agency's contractors to process claim payments. The first quarter's checks reflect claims processed for January, February and most, but not all, of March. Consequently, the number of included, claimed services is smaller. For this reason alone, physicians can expect their second-quarter checks to be larger.

One should also consider that CMS is basing the bonuses on the amount that Medicare Part B reimburses for services, rather than on the total allowable amount. So, the $162 annual deductible and the 20% coinsurance that a beneficiary pays do not count toward the bonus. The bonus payment equation is under examination by the College; ACP believes that CMS should have been more precise in its language regarding the payment calculation.

For subsequent quarters this year, although the beneficiary's coinsurance will not count toward the bonus, most of the deductible amounts are typically satisfied during the first quarter, and should be less of an issue in the bonus payments.

Internal medicine physicians should consider these incentive programs as a way to boost their Medicare revenues. All three can be integrated into a practice's daily work flow.