Published on Sep 15, 2021
This article has been updated to include a comment from CMS and to clarify the commenting period for each proposal.
When the Centers for Medicare and Medicaid released its proposed 2022 reimbursement rates for medical procedures, ophthalmologists around the country were surprised to find that CMS had reduced physician reimbursement for a popular, minimally invasive glaucoma surgery by over 90%.
Doctors who perform the procedure, which involves the insertion of a small stent within the wall of the cornea to drain the excess fluid that causes glaucoma, will now be receiving just $34 for doing so, according to the proposed rates. This is a significant reduction from the $350 to $500 doctors previously received when the procedure was priced by regional Medicare Administrative Contractors.
In addition to lowering the reimbursement rate to doctors for inserting the eye stent, CMS has also proposed to lower the facility fee for ambulatory surgical centers (ASC) by about $800, potentially making the procedure a money-loser for those centers because of the high cost of the devices.
The proposed rates would likely negatively affect Glaukos (GKOS), a manufacturer of eye stents, by making doctors and ASCs much less inclined to perform the procedure.
CMS’ proposals for physician and ASC reimbursement, however, are not final and are subject to a public comment period that ended on September 13 and September 17, respectively. A review of the docket for the 2022 Physicians Fee Schedule finds unanimous opposition from doctors, companies, and ophthalmological trade groups, who all say that the lowered reimbursement rate will likely shut off access to the effective treatment.
“We are commenting to CMS, organizing grass roots efforts, lobbying on the Hill, and we have spoken with CMS directly about this issue,” Dr. Michael Repka of the American Academy of Ophthalmology told The Capitol Forum in an interview, “We hope and assume they will fix the facility problem. We’re less confident on the physician payments but setting a national price as low as they did is going to be very problematic for patient access.”
After reviewing public comments and input from other organizations, CMS will post its final reimbursement rates for both physicians and facilities sometime in November, with the new rates taking effect on January 1, 2022.
If CMS does not revise the reimbursement cuts, in particular the facility fee, it could limit patient access to the surgery or force Glaukos to lower the price of its iStent products in order to make the procedure financially feasible for ASCs, something that the company’s SEC filings note.
“In addition to uncertainties surrounding coverage policies, there are periodic changes to reimbursement levels,” Glaukos’ most recent annual filing states, “Without sufficient reimbursement from governmental programs or third party commercial payors, patients may not be able to access our products. The demand for, and the profitability of, our products could be materially harmed if the Medicaid program, Medicare program, other healthcare programs in the U.S. or elsewhere… provide reimbursement only on unfavorable terms.”
In response to a request for comment for this article, Glaukos provided a previously released statement indicating that it was disappointed in the proposed physician fee and that intended to “engage with CMS during the public comment period in hopes that medical facilities across its network are paid appropriately for conducting these types of procedures.”
Physician reimbursement minimizes work involved and benefit to patient, according to doctors. Reimbursement for eye stent insertion was likely to come down somewhat this year because the procedure is moving from a Category III billing code, which are used for newer and more experimental procedures, to a Category I billing code, which denote more common procedures.
Importantly, eye stent insertion is only authorized by the FDA to be performed in conjunction with cataract surgery. CMS’ calculation for the new rate for corneal implants indicates that the agency felt the procedure was only minimally additive to the overall work performed during cataract surgery.
For 2022, CMS is proposing to reimburse standalone cataract surgery at a rate of $530.98 and cataract surgery combined with eye stent insertion at a rate of $565.23, giving physicians only an extra $34.25 for the additional procedure.
Three ophthalmologists who spoke with The Capitol Forum say that, while it is true a lot of work done during cataract surgery is duplicative of work done to insert eye stents, CMS’ rate does not capture the totality of work involved.
“To put in a stent can require more time in the operating room than CMS is calculating, which is only around 5 minutes. We have to remove the tape and reposition the patients head, reposition the microscope, and use more viscoelastic fluid,” Dr. Robert Peets of the Dayton Eye Care Center explained, “but there is also time spent outside the OR explaining the procedure to the patient, getting their informed consent. There is also a follow up consultation to make sure it is working properly. $34 does not nearly cover any of that.”
“In my wildest imagination,” Dr. Peets continued, “I can’t imagine what CMS is doing with this rate.”
Each doctor said that they would continue providing the procedure given the benefit to the patient, but that they worried that, if CMS did not reverse course, new ophthalmologists would be disinclined to perform the procedure.
“It is true it only takes a few minutes to put the stent in, but it requires a great deal of skill and training to put them in correctly. New surgeons coming into the field might just say it’s not worth their time to train for it,” Dr. Thomas Graul of Eye Surgical Associates in Lincoln, Nebraska said.
Ophthalmologists also stated that they felt that CMS was being too cost-conscious in its reimbursement rate to physicians without accurately calculating in the benefit to both the patient and their health care network. Well over half of the patients that get an eye stent, the doctors said, were able to discontinue the use of daily eye drops, which can cost hundreds of dollars per year and are dependent on the patient remembering to take them.
“Putting in the stent is preventative- it’s cheaper, prevents later, more invasive surgeries, and gets patients off their eye drops,” Dr. Amy Martino of the Eye Institute of West Florida said, adding that “this is real progress in medicine, but this CMS proposal is creating such a negative financial incentive to perform these sight saving procedures, we may no longer be able to do them. It doesn’t make sense; we’re taking one step forward in treatment and two steps backward paying for it.”
“Unfortunately, the government agencies are looking at the smaller aspects of cost rather than the greater good of what’s best for the patient,” Dr. Martino added.
ASC payments may force surgical centers to drop procedure entirely. While the physicians said that they would likely continue implanting eye stents, the decision may not be entirely up to them. Roughly 80% of the procedures, according to Glaukos, are performed in ASCs, which are outpatient centers that do not require overnight stays.
CMS’ 2022 proposed reimbursement rate for ASCs revised the payment rate to the facility from $3,353 in 2021 to $2,516 in 2022. That rate is designed to cover the cost of maintaining the operating room as well as any equipment or devices used in used during the surgery.
To calculate the fees for equipment, CMS uses a standardized device offset cost that caps device costs at 31% of the entire procedure for Category I codes, a ratio that the American Academy of Ophthalmologists says does not accurately reflect the cost of eye stents.
While eye stents are extremely small, often measuring less than one millimeter on all sides, they can be extremely expensive; Glaukos, for example, sells its iStent devices for around $1,000 each. If measured by weight, ophthalmologists tell The Capitol Forum, the devices would be the most expensive substance on the planet.
If CMS does not revise its ASC payment assignment, that $1,000 could quickly eliminate any surgical center’s margin.
“Ophthalmologists will still, if it’s in the best interest of the patient, provide the service, but that’s assuming they can get their facility to allow them do it,” Dr. Repka of the American Academy of Ophthalmology said, “but the ASC under the proposed rule is not going to be paid enough to perform this surgery. Facilities are not going to schedule it if they are going to lose money on every case. So, our concern is that the proposed facility payment will completely shut off access to it, whether or not doctors want to do it.”
That situation is not a hypothetical, according to ophthalmologists, who say that ASCs they work with are already telling them they won’t allow the procedure at the proposed facility rate.
“We are a physician owned hospital and the hospital contacted our group, telling us that it may not be financially feasible to continue offering stents. So much just goes out the door for the device now,” Dr. Graul said.
According to Dr. Repka, a more accurate device offset for stents should have been about 55% of the device cost, which is what it was when it “was billed as a Category III code, and CMS has several years of data showing that. But when they created the new Category I code, CMS looked at it as a new code and didn’t look at the Category III code it replaced. They made a blanket assumption that the device offset would be 31%, and they may not have realized that there is already claims data for the exact same device. CMS has made an error in its device offset calculations we are expecting they will correct.”
Asked if the American Academy of Ophthalmologists had brought the issue to CMS’ attention, Dr. Repka replied that “we have raised this red flag. Everyone in their comment letter is raising this red flag. There’s no doubt they are hearing it from many quarters.”
Asked about the criticism from doctors over the proposals, a spokesperson for CMS told The Capitol Forum that “the agency values the opportunity to solicit public comment on features of proposed rule. While the agency does not speculate on public comments or the rulemaking process as a matter of policy, CMS looks forward to reviewing public feedback—which remains key to shaping policy that can incorporate best practices for beneficiaries and those critical to their care.”