TO SAY THAT 2020 was an unusual year for the U.S. health care system is an understatement. Vein care was certainly swept up in the public health emergency (PHE), and many clinics stopped seeing patients in April and May. In compliance with their state guidance, most vein care offices resumed care by May, with offices developing safety protocols to protect patients and staff. Unless we see a significant COVID resurgence in 2021, it seems most outpatient care will continue.
This major upheaval in care occurred against the backdrop of a financially challenging time in the venous reimbursement sphere. With the historical move away from more invasive surgical care and toward using thermal modalities, vein care saw growth. Many new practices opened and experienced sustainable margins between 2005–2015. But the past few years have seen reimbursement tighten, and as baseball great Yogi Berra supposedly once said,“It seems a nickel ain’t worth a dime anymore.”
I would propose that while the past few years have experienced declining reimbursement, I’m cautiously optimistic that the next few years should see more stability. Let me break down how we got to where we are, and weave in a few ideas that give me optimism about reimbursement.
Medicare Sets the Standard
As the largest payer in the U.S., our Medicare system has emerged as the benchmark for all fee- for-service medical procedural payments. Since the early 1990s, the resource-based relative value update committee (RUC) has convened several times per year to evaluate the physician work relative value units (RVUs) of medical procedures. The RUC also evaluates supplies, equipment and non-MD labor in the office setting through their practice expense subcommittee. In the vein care field, sclerotherapy and thermal ablation codes have gone through this RUC review a few times, resulting in reduced reimbursement by the Centers for Medicare & Medicaid Services (CMS), based on the RUC data collected by physician surveys. In 2017, two new codes for vein mechano-chemical ablation were valued and came into use, and in 2018, new codes for non-compounded foam and cyanoacrylate were introduced.
In the summer of 2018, CMS announced their proposed part B physician fee schedule for 2019. Every summer, CMS promulgates the “proposed rule” for public comment for the ensuing calendar year. In July of 2018, CMS announced a new project called the market-based pricing initiative. This effort reviewed many of the medical supplies and equipment that were in use in the U.S. healthcare system. When the agency saw price variations in a supply from the CMS “list price,” CMS assigned a new price to be phased in over the next four years. Several key vein supply inputs were part of this new pricing, including radiofrequency catheters, radiofrequency introducers, laser kits and compression hose. These new supply inputs had the effect of decreasing office-based payment in 2019 and 2020.
On top of that, the RUC reviewed two codes for ambulatory phlebectomy at their April 2018 meeting. New CMS-approved, office-based payment values went into effect for 2020, resulting in an approximate 32% reduction in payment for those two phlebectomy codes. The reduction in the phlebectomy codes’ valuation arose mainly from decreases in physician time, based on physician surveys and CMS insistence upon using the 25th percentile of the reported times. Had the American Vein & Lymphatic Society (AVLS) not identified misvalued and missing supplies in the RUC valuation, the reductions would have been even more significant.
Using Data to Support Payment
In the summer of 2020, CMS announced their proposed part B rule, laying out changes in payment for 2021. The American Vein & Lymphatic Society’s Healthcare Policy Committee conducted a review of the proposed 2021 rule. We had concerns that additional cuts that CMS noted to supply items were likely not typical for the average provider’s prices.
In October, the AVLS and the American Venous Forum (AVF) submitted a comment letter to CMS. We supplied several redacted invoices from random practices to provide evidence as to typical market pricing. Based on feedback from the AVLS, AVF, and other commenters, CMS published their final 2021 Rule in early December. CMS made 2021/2022 supply adjustments to the price of radiofrequency catheters, radiofrequency introducers and endovenous laser kits. These new supply prices will help stabilize payments in 2021 and 2022, and the AVLS health care policy committee feels that the revised supply inputs are more in line with typical pricing.
Late December—Congress saves the Day!
When CMS issued the 2021 “final rule” for the Part B program in early December, payment for most medical procedures was still going to drop sharply due to CMS’s mandated budget neutrality requirement for Part B overall payment. The revised and new 2021 evaluation & management (E&M) codes were going to move payment out of procedures and into E&M on a national scale.
On December 22, 2020, the President signed into law the Consolidated Appropriations Act, a comprehensive omnibus spending package that funded the federal government through FY 2021, provided a new round of COVID relief and economic stimulus, and made adjustments to the 2021 cuts to procedures that were announced in early December. The Act delayed several budget actions that would have impacted payment. For 2021, the revised conversion factor is still 3.3% lower than the 2020 physician fee schedule conversation factor (PFS CF) of $36.0896. This late federal action was very welcome, as it averted major 2021 cuts, but both the annual and the long-term fiscal fix to Medicare physician payment will need to be fought again for 2022.
Past Performance is not indicative of Future Returns
We have heard this phrase when saving for our retirement and deciding where to invest retirement funds. However, because of the AVLS and other committed partners’ actions, we could advocate for fair payment for 2021 and 2022 for our essential thermal procedures. Are we content with current payment rates? No, of course not, but we are guided by data and what we think is a typical practice in the field. We are working every day to ensure that members get fair treatment and appropriate reimbursement.