The CMS on Thursday finalized a rule that will pay doctors for virtual visits and overhaul Medicare billing standards for office visits that haven’t changed since the 1990s.

The agency will now pay doctors for telehealth visits and communication with patients, acknowledging the time those efforts take.

The CMS also will change how physicians bill Medicare for patient visits under a relatively generic set of codes that distinguish level of complexity and site of care, known as evaluation and management visit codes.

Doctors long have been concerned about the codes’ documentation standards. The CMS has used evaluation and management visit codes since 1995.

One of the largest complaints about the E/M codes was that clinicians had to provide a comprehensive medical history each time they submit a claim. They’d rather document why a patient is receiving care in a specific instance of treatment.

Starting next year, doctors will only have to highlight what’s changed since they last saw the patient, versus restating their whole medical history.

Elsewhere in the rule, the agency plans to continue a controversial site-neutral policy launched in 2018. For the second year in a row, off-campus facilities built after Nov. 2, 2015, will be paid 40% of the outpatient rates for the services they provide.

“We are disappointed that CMS will continue its short-sighted site-neutral policies that ignore the need for hospitals to modernize existing facilities so that they can provide the most up-to-date, high-quality services to their patients and communities,” said Ashley Thompson, senior vice president at American Hospital Association.

The policy encourages fairer competition between hospitals and physician practices by promoting greater payment alignment between outpatient care settings, according to the CMS.

The agency is tweaking the Merit-based Incentive Payment System by junking 26 quality measures that it deemed ineffective after hearing from stakeholders. The proposed rule adds eight quality measures including four based on patients’ reporting of their outcomes.

The CMS also seeks to expand provider participating in MIPS. First, it is expanding eligible clinicians for the program to include physical therapists, occupational therapists, clinical social workers and clinical psychologists.

It is also finalizing an opt-in policy that allows some clinicians, who otherwise would have been excluded under the low-volume threshold, the option to participate in MIPS.

Under MIPS, doctors must hit certain quality thresholds. Those who don’t must pay a penalty that is redistributed to the high performers.

In 2021, practices are eligible for $390 million in incentive payments under MIPS, up from the $118 million the CMS expects to pay out in 2020. The raise is due to more doctors participating in the program.

The agency estimates 798,000 clinicians will be participating in MIPS in 2019, that’s up from 642,000 eligible clinicians it estimated was in the program in 2017.

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Geisinger Health System CEO and President Dr. David Feinberg is reportedly moving to Google, where he’ll run healthcare for the company.

Google’s healthcare efforts are far-reaching, ranging from artificial intelligence to data standards to the cloud.

Neither Geisigner nor Google could be reached for comment. The Wall Street Journal first reported the news. Feinberg took himself out of the running this summer to be considered CEO of the healthcare venture launched by Amazon, Berkshire Hathaway and JPMorgan Chase. That job ultimately went to Dr. Atul Gawande.

Google’s healthcare work will play into the company’s interoperability efforts, which it pledged to pursue—along with Microsoft, Amazon, IBM, Oracle, and Salesforce—earlier this year.

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Facing an increasingly saturated electronic health records market, software vendors like Athenahealth are under increasing pressure to consolidate and seek out new avenues for revenue and growth.

Most healthcare organizations already have EHRs in place, and vendors can no longer count on major growth from new installations alone. That’s spelled lower bookings year over year for some. Ever since Athenahealth began reporting quarterly bookings, it’s reported lower year-over-year booked business. And in the second quarter of the year, Allscripts also had a dip—32%—in booked business.

“They’re now faced with the question of how to continue to be successful and grow,” said John Kelly, principal business adviser for Edifecs. “The way to do that is to consolidate.”

Athenahealth is now the latest company to take that tack. On Monday, two private equity firms announced they plan to buy the vendor for $5.7 billion. Veritas Capital and Elliott Management’s Evergreen Coast Capital will combine Athenahealth with Virence Health Technologies, a former GE Healthcare company.

Unlike the other big EHR vendors, Athenahealth charges its customers a percentage of receivables rather than a set price. The company was also a leader in the cloud, offering cloud-based software while other vendors were focused more on traditional, server-based EHRs. Now, the majority of provider organizations are either currently hosting or are considering hosting their data off-site, according to KLAS Research.

But some question the company’s ability to compete in the EHR market, especially with larger providers. In 2017, Athenahealth had just 2.1% market share for U.S. acute-care hospitals, according to KLAS, while Epic had 26.7% and Cerner had 24.8%.

“Athenahealth really is a revenue cycle management vendor and not really a strong competitor in the clinical market,” Kelly added. “Maybe they would have been if Jonathan (Bush) had stayed.”

Bush left the company in June after reports of sexual harassment surfaced and it was made public that Bush had attacked his now ex-wife during their marriage.

Bush also faced business challenges. “He was able to build the company as a disruptor because he has a disruptor personality,” said Michael Burger, senior consultant at Point of Care Partners. “But at some point, a company grows so big that it needs to be run like a company, as opposed to a small business. The company outgrew Jonathan’s leadership.”

Some are concerned that Athenahealth’s freewheeling culture and its influence on the industry may not survive this deal.

“I’m worried about the impact this will have on creative disruption,” said David Muntz, a healthcare consultant and former principal deputy national coordinator at the Office of the National Coordinator for Health Information Technology.

But the Athenahealth brand is, at this point, still strong.

Consolidation isn’t without its challenges. When companies merge, their platforms don’t necessarily get combined at the same time, according to Point of Care Partners’ Burger. So the newly formed companies must maintain multiple platforms. Allscripts, for example, maintains distinct Practice Fusion and McKesson platforms post-acquisition.

“It’s just not easy to get customers to move to one or the other platform,” Burger said. “You would think the idea would be to move everyone onto the Athenahealth platform, because the GE platform is pretty old,” he added. But based on what’s happened with Allscripts and other acquiring companies, that’s not likely, he said.

EHR vendors that maintain separate platforms can struggle. A year after Cerner acquired Siemens Health Services, for example, 87% of users of Siemens’ EHR said they planned to leave the platform, according to KLAS.

There’s also the matter of data integration. “The overall goal is to focus on how to collect data from all the appropriate sources and then use it when you’re looking at patients, payers and providers,” Muntz said. “The challenge is how they’re going to deal with integration of the data and the processes to improve the overall workflow for the providers and payers.”

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Electronic health records were supposed to lower administrative costs, but they may not be getting the job done, according to a new study published this week in JAMA.

Administrative costs made up as much as a quarter of professional revenue for some patient encounters, according to the study, which focused on a single academic medical center. Researchers attribute much of the high cost to varying contracts between the hospital and health plans and payer as well as varying price schedules.

“After investing more than $30 billion in health IT, we haven’t improved the administrative efficiency,” said Dr. Kevin Schulman, one of the study authors and the associate director of the Duke Clinical Research Institute. “That was one of the big promises of digitizing records.”

For the study, researchers estimated the time each billing step took for a 1,500-bed academic healthcare system in North Carolina. Based on the calculated time and salary information, they estimated personnel costs and also added in overhead costs.

As visit complexity increased, so did the time and costs associated with billing and insurance activities. The estimated total time to process a bill for the least expensive type of encounter, a primary-care visit, was 13 minutes, at a cost of $20.49. The average time for the most expensive type of visit, an inpatient surgical procedure, was 100 minutes, at a cost of $215.10.

Costs associated with billing were even higher when researchers took the cost of the EHR software into account, rising to $32.52 for a primary-care visit and $319.80 for an inpatient surgical procedure.

Across the types of patient encounters, billing costs made up between 3.1% (inpatient surgery) and 25.2% (emergency department visit) of professional revenue.

“These findings suggest that significant investments in certified health information technology have not reduced high billing costs in the United States,” the researchers wrote.

The researchers could not attribute the high costs to “any significantly wasteful or inefficient efforts” in billing, something they speculate could be due to the fact that the health system uses a single billing organization.

Instead, they attribute the costs to differing contracts with payers and price schedules that remain unstandardized.

“We think the costs are due to the complexity of the market itself,” Schulman said. “Part of that complexity comes from the fact that every insurance company has their own way of doing things,” he said. “This is a cost that’s passed onto the provider organizations.”

Any time there’s complexity associated with a system, there are costs associated too, said John Kelly, principal business adviser for software firm Edifecs.

“Payers and providers haven’t really agreed to exchange a lot of information,” he said. “By automating the exchange of information, you can make that complexity easy.”

But the EHR alone won’t solve everything.

“Adoption of certified EHR systems by hospitals appears to have been unable to cope with the complexity of multiple payer contracts,” the study authors wrote.

Nor has it brought about great change in administrative processes.

“We hope this will be a wake-up call that it’s time to focus on administrative simplification,” Schulman said.

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In the past few weeks, Veterans Affairs Secretary Dr. David Shulkin has faced scathing criticism over a number of alleged ethical lapses including accepting free tickets to Wimbledon. Late last week, two top Democrats on the Senate Veterans’ Affairs Committee said “chaos” within the department was affecting care of the veterans the agency seeks to serve.

Shulkin this week will get a chance to distance himself from D.C. as he joins healthcare executives, technology vendors and others gathering in Las Vegas to talk shop and hear about the latest and greatest in health IT.

The Healthcare Information and Management Systems Society’s annual convention and trade show, which runs March 5-9, is expected to draw 45,000 people this year. About 42,287 attended in 2017.

Shulkin is slated to speak Friday morning with Vice Adm. Raquel Bono of the Defense Health Agency and address coordinated care. Former executive chairman of Alphabet (née Google) Eric Schmidt, who spoke at HIMSS in 2008 when Google launched its now defunct personal health record, will talk about how to implement technology effectively in healthcare and how to more quickly transform the industry.

“You see a pattern here—there’s more of a ‘roll up your sleeves and deliver’ mentality,” HIMSS CEO Harold Wolf said.

To that end, Wolf expects conference attendees, speakers and exhibitors to focus on using information technology in care delivery. “How do we put into the hands of both the clinician and the administrator more tools that help them understand end-to-end delivery and the value of it?” Wolf also expects artificial intelligence to garner attention this year, as it has in the past two or three years, as well as cybersecurity, which he called “more important than ever.”

These topics all play into the goal of coming up with new ways to deliver care. “I think the biggest issue that everyone is facing right now is how do we use digital health effectively? How do we take care of individuals outside the walls of the encounter-based paradigm?” Wolf said.


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