No practice left behind.

Top Line: Yesterday we skipped the Pricing Methodology of the RO Model after our noses started bleeding.
The Proposed Rule: So here it is on page 90. If you are in the ~40% of practices that get drafted, you’ll use a new HCPCS code specific to the model to indicate that you are initiating (and then ending) an episode of care. You’ll then receive an initial payment installment, roughly half of your total reimbursement for that course that is calculated from a pricing model using 8 key steps. The main one is step 1 where you start with a national base payment rate for the diagnosis. You’ll want to take Table 3, page 97 to your administrator to see how your current revenue and costs compare. That rate then gets modified each year to account for payment trends going to your friends who didn’t get drafted. It’s then further modified to account for 1) the complexity of your patient population and associated costs and 2) your historical revenue for that diagnosis (from 2015 to 2017). This is important because the latter has an additional “efficiency factor” to account for how far above or below national norms you are. If you’ve been thrifty, you’ll get a little boost in the base rate. If you’ve historically received more than average per diagnosis, you’ll be put on a gradual withdrawal of reimbursement until you get closer to average. Wait, what if I just started practicing? Well, you’ll be pegged to the national benchmark. Next comes several discounts and withholding, mostly for quality metrics. Then there’s a geographic factor, beneficiary coinsurance (20%), and a final 2% sequestration. When the 90 day period is over, you’ll get installment 2. Yearly, you’ll get or lose your withholdings based on your participation and performance.
TBL: After you come to terms with the structure of the RO Model, the pricing methodology section (Table 3, page 97) is where you’ll get the most information about how reimbursement will work for you. | CMS 2019


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