The Medicaid Recovery Audit Contractor (RAC) program is projected by the U.S. Department of Health and Human Services (HHS) to save $2.1 billion over the next five years by detecting and correcting improper payments by reviewing claims after the payments have been made. The program is based on the existing Medicare Recovery Audit program and will be largely self-funded. The final rule for the Medicaid RAC program goes into effect on January 1, 2012.

The Centers for Medicare & Medicaid Services (CMS) has directed contractors to use postcards announcing the open participation enrollment period this year in place of the CD packets. Previously, the CD packets included an electronic copy of the Medicare Physician Fee Schedule (MPFS). Due to the frequency of last-minute changes to the MPFS in recent years, CMS has directed contractors not to distribute electronic copies. Instead, contractors will keep updated copies of the MPFS and enrollment information on their websites, which will be listed on the postcard. Participating health-care professionals who do not wish to change their participation status will not be required to take any action during the open enrollment period. Postcard announcements will be mailed in early November.

In January, the AASM announced that the Centers for Medicare & Medicaid Services (CMS) approved the establishment of a physician specialty code for sleep medicine. The original approval letter from CMS indicated that the code would be established after October 2011. In an email received Thursday September 8, staff from the CMS Provider Enrollment Operations Group notified the AASM that the establishment of the specialty code has been delayed. CMS staff cited system implementation issues, which will prevent the code from being established until April 2012. The AASM will continue to keep members updated regarding this important issue via the Weekly Update. Once the specialty code has been established, members will be provided information about how to change their specialty information with CMS.

In the Sept. 6 Federal Register, the Centers for Medicare and Medicaid Services (CSM) published a final rule describing changes to the eRx Incentive Program. Beginning in 2012, providers who do not successfully prescribe electronically per CMS requirements will receive a penalty, also known as a payment adjustment, of -1 percent of allowable charges. This adjustment is projected to increase to -1.5 percent in 2013 and -2 percent in 2014.

Providers who believe they cannot meet the requirements of the eRx incentive program due to hardship can apply for exemption from the eRx program. Major changes to the eRx program, as outlined in the final rule, include the addition of new hardship exemption categories as well as an extension of the deadline to submit a hardship exemption request. The exemption deadline is now Nov. 1, 2011.

On August 30, the Office of the Inspector General (OIG) published two compliance reports for Independent Diagnostic Testing Facilities (IDTFs). The reports describe unannounced site visits conducted at all fixed location IDTFs in both the Miami and Los Angeles areas. As a result of the unannounced visits conducted in Miami and Los Angeles, the OIG has recommended that more unannounced visits be conducted. Both compliance reports include information regarding the IDTF standards and can serve as helpful tools for IDTFs looking to maintain compliance with CMS requirements.

According to a recent article from Kaiser Health News, new figures released by the Congressional Budget Office include the imposition of steep Medicare cuts for physicians. The CBO’s new baseline projections of the federal budget estimate that cumulative deficits will reach $3.5 trillion between 2012 and 2021 — a much shallower budget hole than the $6.7 trillion CBO projected in March.

On Tuesday, Aug. 9, the AASM sent a comment letter to the Centers for Medicare & Medicaid Services (CMS) outlining concerns regarding the 2012 Physician Fee Schedule Proposed Rule. AASM members also are encouraged to provide CMS with their own comments on the 2012 Physician Fee Schedule Proposed Rule. Comments to CMS are due by Aug. 30 using the contact information found on the first page of the Proposed Rule.

On Friday, Aug. 19, the Centers for Medicare & Medicaid Services (CMS) announced that it will expand the durable medical equipment, prosthetics, orthotics and supplies (DMEPOS) competitive bidding program, which is used to set prices for DME.  Among the product categories for Round Two are continuous positive airway pressure (CPAP) devices and respiratory assist devices (RADs) and related supplies and accessories.  Bidding for Round Two, which will expand the program from nine cities to 91 areas, will begin this fall.