(Washington, D.C.) – A coalition of medical specialties today congratulated the Center for Medicare and Medicaid Services (CMS) for its careful and reasoned implementation of up-to-date practice expense rates into its physician payments. The new practice expense rates that were recently issued by CMS use accurate data from a rigorous survey supported by more than 70 medical and health care professional groups, and they begin a long-needed correction that should remain untouched by Congress. The new practice expense rates recognize that overhead costs differ among physician specialties, and rely upon data that was independently corroborated by a respected third-party survey firm.

“For most specialties, CMS had been using practice cost data that was at least a decade old and does not accurately capture the relative costs faced by different physician practices today,” said David W. Parke II, MD, CEO of the American Academy of Ophthalmology, which is a member of the coalition. “The new rates level the playing field by using sound data gathered from all specialties at the same time. We are pleased that CMS used strong, scientifically valid evidence to determine fair and accurate physician practice expense rates.”

The latest practice expense data is based on a new Physician Practice Information Survey (PPIS) conducted in 2008 under strict methodology as outlined by CMS. The results were validated by The Lewin Group, an independent survey firm. CMS’ implementation of reimbursement rates based on the new practice cost data ends four years of losses by many specialties that began in 2005, when CMS adopted external data from only a few specialties. CMS corrects the previous imbalances in its 2010 Final Fee Schedule rule, but will phase in the new practice expense data over a four-year period. In their own words from the rule, CMS calls PPIS “the most comprehensive, multispecialty, contemporaneous, consistently collected PE data source available.” The data does not by itself result in more payments to physicians, but a redistribution of the payment pool based in part on the practice expense data.

The survey design and methodology had the wide support of medicine and other health care professional groups, including funding from CMS and the AMA. Medical and health care groups were not alone in calling for new practice expense data. The Medicare Payment Advisory Commission and the Government Accounting Office had called for CMS to update data for all specialties.

“The CMS rule is a fair solution to a long-standing problem. The new rates are the result of a sound and careful process that had the broad support of medicine,” said Lori Heim, MD, president of the American Academy of Family Physicians. “We are hopeful that Congress will realize that second-guessing the process will not improve patient care or safety and will only reinstate the imbalances that previously existed.”

The coalition members are:

• American Academy of Dermatology Association
• American Academy of Family Physicians
• American Academy of Neurology Professional Association
• American Academy of Ophthalmology
• American Academy of Otolaryngology – Head and Neck Surgery
• American Association of Neurological Surgeons
• American Association of Orthopaedic Surgeons
• American College of Emergency Physicians
• American College of Obstetricians and Gynecologists
• American College of Surgeons
• American Occupational Therapy Association
• American Optometric Association
• American Physical Therapy Association
• American Psychiatric Association
• American Society of Anesthesiologists 
• American Society of Cataract and Refractive Surgery
• American Society of Plastic Surgeons
• Congress of Neurological Surgeons
• Infectious Diseases Society of America

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About the American Academy of Ophthalmology
The Academy is the world's largest association of eye physicians and surgeons—Eye M.D.s—with more than 27,000 members worldwide.  Eye health care is provided by the three “O’s” – opticians, optometrists and ophthalmologists. It is the ophthalmologist, or Eye M.D., who can treat it all: eye diseases and injuries, and perform eye surgery. To find an Eye M.D. in your area, visit the Academy's Web site at www.aao.org.