House committee passes Medicare payment reform bill

The House Ways & Means Committee on May 21 passed the Provider Reimbursement Stability Act(HR 8163), which would make Medicare payment cuts to physicians, including OMSs, less frequent by increasing the threshold that triggers automatic payment reduction. The legislation would raise the budget neutrality threshold from $20 million to $54.3 million and adjust the threshold for inflation every five years. It also would allow CMS to fix utilization errors that affect the budget neutrality calculation; require CMS to update the direct costs used to calculate practice expense relative value units (RVUs) at least every five years; and limit annual changes to the conversion factor to 2.5 percent. Several other bills to reform the Medicare physician payment system have either been introduced or are pending introduction, some of which include similar provisions. It remains unclear whether or when HR 8163 will move to the full House for consideration.