As Medicare Goes, so Goes Managed Care (Or so the Saying Goes)

Neil Versel
Published: Wednesday, Mar 18, 2009
Who will lead the way in promoting greater adoption of e-prescribing, and how can physicians get the most out of using this technology in their practice?

Private payers often set their reimbursement rates based on Medicare payment schedules and take their lead on policy changes from the government as well. But with e-prescribing, the relationship might be more of a codependency, with each sector taking cues from the other. Thanks to the Medicare Improvements for Patients and Providers Act (MIPPA) that became law last July, the Centers for Medicare and Medicaid Services this year and next is providing physicians who “successfully” e-prescribe—according to CMS’s definition—with 2% bonus payments on top of regular Medicare Part B fees. That rate falls to 1% in 2011 and to 0.5% in 2013. And starting in 2012, CMS will dock 1% from anyone not writing electronic prescriptions for a majority of Medicare-eligible patients, a penalty that climbs to 1.5% in 2013 and 2% in 2014. Any bonuses are in addition to the extra money doctors can earn for participating in the Physician Quality Reporting Initiative program (this year, the PQRI bonus is 2%). Under the new CMS rules, a qualified e-prescribing system must be able to:

• Generate a “complete active medication list” based on data sent by pharmacies and pharmacy benefit managers;

• Select medications, produce safety alerts, and both print and electronically transmit prescriptions to pharmacies, though CMS backed off from an earlier ruling that electronic faxes would not qualify as e-prescriptions;

• Receive details on tiered formularies or otherwise provide information on lower-cost options;

• Provide formularies, and if available, patient eligibility and authorization requirements.

This incentive program replaces PQRI measure 125, which listed three G-codes to indicate whether the participating practice attempted to write electronic prescriptions. Reporting continues to go through the PQRI framework. CMS also says that federally qualified health centers that do not bill under Medicare Part B and others that apply the e-prescribing measure to less than 10% of total Part B charges are ineligible for the bonus payments. The agency also may exclude providers that do not submit an adequate volume of prescriptions under Medicare Part D.


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