RUC Predicted to Slash AK Reimbursement

WAIKOLOA, HAWAII – Look for a major cut in reimbursement for the treatment of actinic keratoses when the matter comes up for review by the American Medical Association Relative Value Scale Update Committee in January, according to Dr. Brett M. Coldiron.

"It’s going to be bad, bad. The best-case scenario our team has worked out is a 25% cut," Dr. Coldiron said at the Hawaii Dermatology Seminar, sponsored by Skin Disease Education Foundation (SDEF).

Bruce Jancin/IMNG Medical Media

It’s entirely possible that the committee will instead recommend closer to a 50% slash in its report to the Center for Medicare and Medicaid Services, added Dr. Coldiron, who has represented dermatology on the Relative Value Scale Update Committee (RUC) or served in an advisory capacity for the past 19 years.

"That first AK relative value rating was based on numbing [the AK], curetting it twice, electrodesiccation, and [the rating estimated] 47 minutes of nursing time. It’s an extraordinary rating ... [times have changed], and now it’s finally up for review," explained Dr. Coldiron, president of the American College of Mohs Surgery and a 2013 member of the board of directors for the American Academy of Dermatology.

Dermatologists perform 86% of all AK treatments in the United States. And the number of procedures in which they bill Medicare for treating 15 or more AKs jumped by 185% from 1995 to 2006, to nearly 734,000 procedures per year.

Meanwhile, the number of Mohs surgery procedures billed to Medicare has increased by a whopping 400%, skin biopsies by dermatologists have increased by 82%, destructions by 68%, and excisions by 22%.

"Those are extraordinary increases, and you have to realize that they’re underestimates because they don’t include billing under Medicare private plans, which take up about 20% of Medicare dollars," he said.

All the Mohs surgery–related codes will come up for RUC review in April 2013. Dr. Coldiron anticipates reimbursement to be cut by about 20%.

He provided the audience with a colorful behind-the-scenes account of the RUC review process.

"The RUC is the Super Bowl of AMA committees, where everybody sits around a table and tries to strip money away from another specialty," he explained. "The RUC is 26 sharks in a tank with nothing to eat but each other. And we’re a small specialty with a ‘Bite Me’ sign on us. We’re less than 1% of all physicians. We have a seat on RUC because we were there from the beginning. But we have many specialty-specific codes which they can target, and we have rapidly increasing utilization."

What’s it like to stand up for dermatology at a RUC review before adversaries representing 25 other medical specialties? "I present the codes and they shoot questions; they just pound on you, sometimes for days. It’s very uncomfortable. They try to figure out what a code is really worth. It’s not much fun at all," said Dr. Coldiron, a dermatologist at the University of Cincinnati.

This intense battle is fueled by jealousy on the part of other specialties, he said. "Dermatology has done better than anybody else in RUC during the past 20 years. Our share of the Medicare pie has gone from about 2% to 3% of the whole Medicare pool, and they’re all aware of this."

He suspects many of his fellow dermatologists will respond to the coming cut in payment for AK therapy by saying, "Well, I used to bill for 10 AKs when I did 15, now I’m going to bill for all 15 of them." That’s a bad idea, in his view. If utilization suddenly shoots up, reimbursement will simply get cut again. And sharp increases in utilization will attract unwanted attention from the Recovery Audit Contractors (RACs). On a contingency basis, Medicare pays RACS 9%-13% of the money recovered through RAC audits for inappropriate billing.

The anticipated cuts in reimbursement for codes covering AK therapy, Mohs surgery, and medical pathology represent a particularly serious threat to academic dermatology, since most departments derive a substantial portion of their funding from those clinical services. Moreover, academic dermatologists have already been hit harder than others by the loss of consultation codes in the Medicare fee schedule, which translates to an estimated $7,000 per year in lost income for most.

The RUC cuts in reimbursement for AK treatment and Mohs surgery will hurt. But they are by no means the biggest threat facing dermatology, in Dr. Coldiron’s view. That distinction belongs to the Independent Payment Advisory Panel (IPAP) empowered by the Patient Protection and Affordable Care Act. The panel’s job will be to identify overused, overpaid, or useless services and cut Medicare payment rates for providers of those services. Their decisions cannot be reversed except by a two-thirds majority of Congress.

"This is serious for us and all small specialties because anything could happen. Why cover Mohs surgery at all? After all, it’s not covered in Great Britain or France, and they’ve got pretty good health care. Why cover acne – isn’t that cosmetic? Why pay pathologists for seborrheic keratoses? There are all kinds of possibilities here that we need to be prepared for," he cautioned.

He predicted that dermatology and other small specialties will get hit first and hardest by health care cost containment efforts. The RUC doesn’t like dermatology. Nor do Medicare officials and some key members of Congress. Neither does the Medicare Payment Advisory Commission (MedPAC), an independent federal body created to help Congress address complicated health policy issues.

"MedPAC likes primary care. They’re getting a bad attitude after 19 years of no increase for primary care. They want all procedure-oriented specialists to be paid the same as the cognitives," Dr. Coldiron said.

He added that fundamental misconceptions regarding dermatology abound. "They think that what dermatologists do is not important, that it’s cosmetic. And that our increase in Relative Value Units is due to waste, abuse, and minor procedure codes that pay too much. If dermatology disappeared there would be few tears shed," according to Dr. Coldiron.

These critics focus on the fact that dermatology, having reinvented itself as a skin surgical specialty, has become the most procedurally oriented of all specialties. Indeed, in the Medicare database, 73% of dermatologists’ income comes from procedures; ophthalmology is a distant second at 56%.

Dermatology’s critics are unwilling to recognize that the main reason for the big jump in dermatologic procedures during the last 2 decades is the ongoing skin cancer epidemic, Dr. Coldiron continued. He was a coinvestigator in a major study that documented a 75% jump in the age-adjusted rate of skin cancer procedures in the Medicare fee-for-service population between 1992 and 2006 (Arch. Dermatol. 2010;146:283-7).

By 2008, the estimated annual incidence of nonmelanoma skin cancer in the United States stood at nearly 3.7 million cases, far higher than previously recognized (Semin. Cutan. Med. Surg. 2011;30:3-5). Today the incidence is close to 4 million cases per year, he added.

"That’s the result of a lot of baby boomers lying out in the sun. The problem is that the government doesn’t want to pay for it. They would rather pretend it doesn’t exist," Dr. Coldiron concluded.

He reported having no financial conflicts. SDEF and this news organization are owned by Elsevier.

WAIKOLOA, HAWAII – Look for a major cut in reimbursement for the treatment of actinic keratoses when the matter comes up for review by the American Medical Association Relative Value Scale Update Committee in January, according to Dr. Brett M. Coldiron.

"It’s going to be bad, bad. The best-case scenario our team has worked out is a 25% cut," Dr. Coldiron said at the Hawaii Dermatology Seminar, sponsored by Skin Disease Education Foundation (SDEF).

Bruce Jancin/IMNG Medical Media

It’s entirely possible that the committee will instead recommend closer to a 50% slash in its report to the Center for Medicare and Medicaid Services, added Dr. Coldiron, who has represented dermatology on the Relative Value Scale Update Committee (RUC) or served in an advisory capacity for the past 19 years.

"That first AK relative value rating was based on numbing [the AK], curetting it twice, electrodesiccation, and [the rating estimated] 47 minutes of nursing time. It’s an extraordinary rating ... [times have changed], and now it’s finally up for review," explained Dr. Coldiron, president of the American College of Mohs Surgery and a 2013 member of the board of directors for the American Academy of Dermatology.

Dermatologists perform 86% of all AK treatments in the United States. And the number of procedures in which they bill Medicare for treating 15 or more AKs jumped by 185% from 1995 to 2006, to nearly 734,000 procedures per year.

Meanwhile, the number of Mohs surgery procedures billed to Medicare has increased by a whopping 400%, skin biopsies by dermatologists have increased by 82%, destructions by 68%, and excisions by 22%.

"Those are extraordinary increases, and you have to realize that they’re underestimates because they don’t include billing under Medicare private plans, which take up about 20% of Medicare dollars," he said.

All the Mohs surgery–related codes will come up for RUC review in April 2013. Dr. Coldiron anticipates reimbursement to be cut by about 20%.

He provided the audience with a colorful behind-the-scenes account of the RUC review process.

"The RUC is the Super Bowl of AMA committees, where everybody sits around a table and tries to strip money away from another specialty," he explained. "The RUC is 26 sharks in a tank with nothing to eat but each other. And we’re a small specialty with a ‘Bite Me’ sign on us. We’re less than 1% of all physicians. We have a seat on RUC because we were there from the beginning. But we have many specialty-specific codes which they can target, and we have rapidly increasing utilization."

What’s it like to stand up for dermatology at a RUC review before adversaries representing 25 other medical specialties? "I present the codes and they shoot questions; they just pound on you, sometimes for days. It’s very uncomfortable. They try to figure out what a code is really worth. It’s not much fun at all," said Dr. Coldiron, a dermatologist at the University of Cincinnati.

This intense battle is fueled by jealousy on the part of other specialties, he said. "Dermatology has done better than anybody else in RUC during the past 20 years. Our share of the Medicare pie has gone from about 2% to 3% of the whole Medicare pool, and they’re all aware of this."

He suspects many of his fellow dermatologists will respond to the coming cut in payment for AK therapy by saying, "Well, I used to bill for 10 AKs when I did 15, now I’m going to bill for all 15 of them." That’s a bad idea, in his view. If utilization suddenly shoots up, reimbursement will simply get cut again. And sharp increases in utilization will attract unwanted attention from the Recovery Audit Contractors (RACs). On a contingency basis, Medicare pays RACS 9%-13% of the money recovered through RAC audits for inappropriate billing.

The anticipated cuts in reimbursement for codes covering AK therapy, Mohs surgery, and medical pathology represent a particularly serious threat to academic dermatology, since most departments derive a substantial portion of their funding from those clinical services. Moreover, academic dermatologists have already been hit harder than others by the loss of consultation codes in the Medicare fee schedule, which translates to an estimated $7,000 per year in lost income for most.

The RUC cuts in reimbursement for AK treatment and Mohs surgery will hurt. But they are by no means the biggest threat facing dermatology, in Dr. Coldiron’s view. That distinction belongs to the Independent Payment Advisory Panel (IPAP) empowered by the Patient Protection and Affordable Care Act. The panel’s job will be to identify overused, overpaid, or useless services and cut Medicare payment rates for providers of those services. Their decisions cannot be reversed except by a two-thirds majority of Congress.

"This is serious for us and all small specialties because anything could happen. Why cover Mohs surgery at all? After all, it’s not covered in Great Britain or France, and they’ve got pretty good health care. Why cover acne – isn’t that cosmetic? Why pay pathologists for seborrheic keratoses? There are all kinds of possibilities here that we need to be prepared for," he cautioned.

He predicted that dermatology and other small specialties will get hit first and hardest by health care cost containment efforts. The RUC doesn’t like dermatology. Nor do Medicare officials and some key members of Congress. Neither does the Medicare Payment Advisory Commission (MedPAC), an independent federal body created to help Congress address complicated health policy issues.

"MedPAC likes primary care. They’re getting a bad attitude after 19 years of no increase for primary care. They want all procedure-oriented specialists to be paid the same as the cognitives," Dr. Coldiron said.

He added that fundamental misconceptions regarding dermatology abound. "They think that what dermatologists do is not important, that it’s cosmetic. And that our increase in Relative Value Units is due to waste, abuse, and minor procedure codes that pay too much. If dermatology disappeared there would be few tears shed," according to Dr. Coldiron.

These critics focus on the fact that dermatology, having reinvented itself as a skin surgical specialty, has become the most procedurally oriented of all specialties. Indeed, in the Medicare database, 73% of dermatologists’ income comes from procedures; ophthalmology is a distant second at 56%.

Dermatology’s critics are unwilling to recognize that the main reason for the big jump in dermatologic procedures during the last 2 decades is the ongoing skin cancer epidemic, Dr. Coldiron continued. He was a coinvestigator in a major study that documented a 75% jump in the age-adjusted rate of skin cancer procedures in the Medicare fee-for-service population between 1992 and 2006 (Arch. Dermatol. 2010;146:283-7).

By 2008, the estimated annual incidence of nonmelanoma skin cancer in the United States stood at nearly 3.7 million cases, far higher than previously recognized (Semin. Cutan. Med. Surg. 2011;30:3-5). Today the incidence is close to 4 million cases per year, he added.

"That’s the result of a lot of baby boomers lying out in the sun. The problem is that the government doesn’t want to pay for it. They would rather pretend it doesn’t exist," Dr. Coldiron concluded.

He reported having no financial conflicts. SDEF and this news organization are owned by Elsevier.

WAIKOLOA, HAWAII – Look for a major cut in reimbursement for the treatment of actinic keratoses when the matter comes up for review by the American Medical Association Relative Value Scale Update Committee in January, according to Dr. Brett M. Coldiron.

"It’s going to be bad, bad. The best-case scenario our team has worked out is a 25% cut," Dr. Coldiron said at the Hawaii Dermatology Seminar, sponsored by Skin Disease Education Foundation (SDEF).

Bruce Jancin/IMNG Medical Media

It’s entirely possible that the committee will instead recommend closer to a 50% slash in its report to the Center for Medicare and Medicaid Services, added Dr. Coldiron, who has represented dermatology on the Relative Value Scale Update Committee (RUC) or served in an advisory capacity for the past 19 years.

"That first AK relative value rating was based on numbing [the AK], curetting it twice, electrodesiccation, and [the rating estimated] 47 minutes of nursing time. It’s an extraordinary rating ... [times have changed], and now it’s finally up for review," explained Dr. Coldiron, president of the American College of Mohs Surgery and a 2013 member of the board of directors for the American Academy of Dermatology.

Dermatologists perform 86% of all AK treatments in the United States. And the number of procedures in which they bill Medicare for treating 15 or more AKs jumped by 185% from 1995 to 2006, to nearly 734,000 procedures per year.

Meanwhile, the number of Mohs surgery procedures billed to Medicare has increased by a whopping 400%, skin biopsies by dermatologists have increased by 82%, destructions by 68%, and excisions by 22%.

"Those are extraordinary increases, and you have to realize that they’re underestimates because they don’t include billing under Medicare private plans, which take up about 20% of Medicare dollars," he said.

All the Mohs surgery–related codes will come up for RUC review in April 2013. Dr. Coldiron anticipates reimbursement to be cut by about 20%.

He provided the audience with a colorful behind-the-scenes account of the RUC review process.

"The RUC is the Super Bowl of AMA committees, where everybody sits around a table and tries to strip money away from another specialty," he explained. "The RUC is 26 sharks in a tank with nothing to eat but each other. And we’re a small specialty with a ‘Bite Me’ sign on us. We’re less than 1% of all physicians. We have a seat on RUC because we were there from the beginning. But we have many specialty-specific codes which they can target, and we have rapidly increasing utilization."

What’s it like to stand up for dermatology at a RUC review before adversaries representing 25 other medical specialties? "I present the codes and they shoot questions; they just pound on you, sometimes for days. It’s very uncomfortable. They try to figure out what a code is really worth. It’s not much fun at all," said Dr. Coldiron, a dermatologist at the University of Cincinnati.

This intense battle is fueled by jealousy on the part of other specialties, he said. "Dermatology has done better than anybody else in RUC during the past 20 years. Our share of the Medicare pie has gone from about 2% to 3% of the whole Medicare pool, and they’re all aware of this."

He suspects many of his fellow dermatologists will respond to the coming cut in payment for AK therapy by saying, "Well, I used to bill for 10 AKs when I did 15, now I’m going to bill for all 15 of them." That’s a bad idea, in his view. If utilization suddenly shoots up, reimbursement will simply get cut again. And sharp increases in utilization will attract unwanted attention from the Recovery Audit Contractors (RACs). On a contingency basis, Medicare pays RACS 9%-13% of the money recovered through RAC audits for inappropriate billing.

The anticipated cuts in reimbursement for codes covering AK therapy, Mohs surgery, and medical pathology represent a particularly serious threat to academic dermatology, since most departments derive a substantial portion of their funding from those clinical services. Moreover, academic dermatologists have already been hit harder than others by the loss of consultation codes in the Medicare fee schedule, which translates to an estimated $7,000 per year in lost income for most.

The RUC cuts in reimbursement for AK treatment and Mohs surgery will hurt. But they are by no means the biggest threat facing dermatology, in Dr. Coldiron’s view. That distinction belongs to the Independent Payment Advisory Panel (IPAP) empowered by the Patient Protection and Affordable Care Act. The panel’s job will be to identify overused, overpaid, or useless services and cut Medicare payment rates for providers of those services. Their decisions cannot be reversed except by a two-thirds majority of Congress.

"This is serious for us and all small specialties because anything could happen. Why cover Mohs surgery at all? After all, it’s not covered in Great Britain or France, and they’ve got pretty good health care. Why cover acne – isn’t that cosmetic? Why pay pathologists for seborrheic keratoses? There are all kinds of possibilities here that we need to be prepared for," he cautioned.

He predicted that dermatology and other small specialties will get hit first and hardest by health care cost containment efforts. The RUC doesn’t like dermatology. Nor do Medicare officials and some key members of Congress. Neither does the Medicare Payment Advisory Commission (MedPAC), an independent federal body created to help Congress address complicated health policy issues.

"MedPAC likes primary care. They’re getting a bad attitude after 19 years of no increase for primary care. They want all procedure-oriented specialists to be paid the same as the cognitives," Dr. Coldiron said.

He added that fundamental misconceptions regarding dermatology abound. "They think that what dermatologists do is not important, that it’s cosmetic. And that our increase in Relative Value Units is due to waste, abuse, and minor procedure codes that pay too much. If dermatology disappeared there would be few tears shed," according to Dr. Coldiron.

These critics focus on the fact that dermatology, having reinvented itself as a skin surgical specialty, has become the most procedurally oriented of all specialties. Indeed, in the Medicare database, 73% of dermatologists’ income comes from procedures; ophthalmology is a distant second at 56%.

Dermatology’s critics are unwilling to recognize that the main reason for the big jump in dermatologic procedures during the last 2 decades is the ongoing skin cancer epidemic, Dr. Coldiron continued. He was a coinvestigator in a major study that documented a 75% jump in the age-adjusted rate of skin cancer procedures in the Medicare fee-for-service population between 1992 and 2006 (Arch. Dermatol. 2010;146:283-7).

By 2008, the estimated annual incidence of nonmelanoma skin cancer in the United States stood at nearly 3.7 million cases, far higher than previously recognized (Semin. Cutan. Med. Surg. 2011;30:3-5). Today the incidence is close to 4 million cases per year, he added.

"That’s the result of a lot of baby boomers lying out in the sun. The problem is that the government doesn’t want to pay for it. They would rather pretend it doesn’t exist," Dr. Coldiron concluded.

He reported having no financial conflicts. SDEF and this news organization are owned by Elsevier.