Fall 2010 issue of Horizons

General Topics – continued

The Impact on Healthcare Reform on Physicians

Employers Employers are not required by this legislation to provide health coverage, but “applicable large employers” that do not will be liable for an additional tax. An employer is an “applicable large employer” with respect to any calendar year if it employed an average of at least 50 full-time employees during the preceding calendar year. The penalty for any month is an excise tax equal to the number of full-time employees over a 30-employee threshold during the applicable month (regardless of how many employees are receiving a premium tax credit or cost-sharing reduction) multiplied by one- twelfth of $2,000. The penalty would apply to employers with 50 or more workers the first 30 workers would be subtracted from the payment calculation. Businesses with fewer than 50 employees would be exempt from any employer responsibility. In addition, the bill requires employer W-2 reporting of the value of health benefits. Small Business Tax Credits • From 2010-2013, eligible employers (fewer than 25 employees and less than annual wages of $50,000) may qualify for a tax credit of up to 35 percent of their contribution toward employees’ health insurance premium. • In 2014 and beyond, eligible employers may qualify for a credit for two years of up to 50 percent of their contribution. Other Significant Provisions Additional Medicare Payroll Tax • Increased Medicare tax on employees of 0.9 percent on earned income in excess of $200,000 for individuals and $250,000 for joint filers (rate increased from 1.45 percent to 2.35 percent ) beginning in 2013.

The Patient Protection and Affordable Care Act (a.k.a. “Health Care Reform”) became law in March of 2010. While there are provisions that will impact all Americans, included in the laws are specific provisions that will specifically impact health care providers.

Public Reporting of Physician Performance Information

By January 1, 2011, the Secretary of Health and Human Services will create a physician website that contains information on physicians enrolled in the Medicare program and other eligible professionals who participate in the Physician Quality and Reporting Initiative.

Improvement to the Physician Feedback Program

Medicare’s Physician Feedback Program will be expanded to provide for development of individualized reports by 2012. Reports will compare the per capita utilization of physicians (or groups of physicians) to other physicians who see similar patients. Reports will be risk adjusted and standardized to take into account local health care costs. Creation of Accountable Care Organizations under the Medicare Shared Savings Program A shared savings program has been created to promote accountability for a patient population, coordinate items and services under Medicare part A and B, and encourage investments in infrastructure and redesign care processes for a high quality and efficient service delivery. Accountable care organizations, composed of a group of providers, will be rewarded with a share of the savings for providing high quality of care and/or care at lower costs relative to a spending benchmark. Payments under the Physician Quality Reporting Initiative are extended through 2014. Beginning in 2014, physicians who do not report quality measures to the Physician Quality Reporting Initiative will have their Medicare payments reduced. Physician Fee Schedule Value Based Payment Modifier The Secretary of Health and Human Services is required to develop and implement a budget-neutral payment system that will adjust Medicare physician payments based on the quality and cost of care they deliver. Quality and cost measures will be risk-adjusted and geographically standardized. The Secretary will phase in the new payment system over a two year period beginning in 2015. Improvement to the Physician Quality Reporting System

Raise Your Expectations

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