Washington Update. Rebecca Hyder Director, Congressional Affairs American Academy of Ophthalmology

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1 Washington Update Rebecca Hyder Director, Congressional Affairs American Academy of Ophthalmology

2 214 Legislative Agenda Medicare Physician Payment Reform Compounding Vision Research Funding

3 Physician Payment Environment Physicians face a 24 cut starting April 1 due to the sustainable growth rate (SGR) formula which is used to determine Medicare payments Over last 1 years, Congress has spent nearly $154 billion to avert SGR cuts to doctors Conservatives in House insist on offsets for patches Harder to find offsets to pay for short-term patches Other providers lobbying to avoid being a pay-for for SGR patch 2% cuts to Medicare services payments under budget sequestration has been extended to 223

4 Physician Payment Environment Physicians face increasing penalties under existing Medicare quality improvement programs (PQRS, EHR/MU and VBM) Ophthalmology also targeted under potentially misvalued codes initiative Without Reform, Cuts in Medicare Fee-for-Service is the Future

5 Value Based Purchasing VBP PQRS (Successful Participation) (Not Participating) MOC (Participate) CMS may consider MOC in the value based modifier. E RX (Successful Participation) (Not Successful) EHR (Achieve MU) Beginning in 211, physicians can earn up to $44, for adoption of EHR/MU (Qualifying for EHR MU precludes e- prescribing bonus) (Not Achieving) to -5 VBM (based on PQRS participation) -1 to +2x (groups of 1+) TBD proposed -2 +1x 2x TBD (all physicians) potentially -3 TBD potentially -3 or more Total Exposure 4%** 4% 2.5% +2% to -1% * * +1.5% to -1.5% * -2% +1% to -2% * -3.5% to +2x potentially -6% potentially -8 or more potentially -8 to 1

6 Physician Payment Reform CBO Score $116 Billion- SGR Repeal on Sale More Agreement on What Should Replace the SGR Policymakers Want to Incentivize Physicians to Move to New Payment Models

7 Physician Payment Reform Three Committees of Jurisdiction Senate Finance House Ways and Means House Energy and Commerce Committees Approved SGR Bills in 213 Committees Reached Agreement on Final SGR Bill Last Week

8 Physician Payment Reform H.R. 415/S. 2 Bipartisan, Bicameral Support Repeal SGR Preserve a Fee-for-Service Payment Model Provide 5-years of Stable Payments with.5% Positive Updates Provide Financial Incentives to Transition to APM Provide Penalty Relief from Existing Quality Programs

9 Physician Payment Reform New Merit-Based Incentive Payment System (MIPS) includes PQRS, EHR/MU, VBM and new clinical practice improvement activities Starts in 218 High Performers Eligible for Incentive Payments Low Performers Face Penalties Capped at 4% in First Year Forces Redistribution of Dollars Among Specialties and Primary Care

10 Physician Payment Reform Finding Offsets Remains a Challenge to Moving Forward Funding Discussions are Ongoing Outcome Depends on Medicine Reaction-Engagement

11 Compounding October 212 fungal meningitis outbreak Traced to epidural steroid injections from New England Compounding Center 64 deaths, 751 sickened nationwide Increased scrutiny of compounding pharmacies on state and federal level

12 Compounding Ophthalmology: Every subspecialty uses compounded drugs Retina, Glaucoma, Cornea, Pediatrics Access to drugs for office critical to practice of ophthalmology Want safe and effective treatments for patients Worked across ophthalmology and the rest of medicine at both state and federal level to ensure access

13 Compounding Public Law : Repackaging of drugs, like Avastin, regulated under existing law; FDA enforcement discretion Outsourcing facilities that voluntarily register for FDA oversight and meet higher federal safety standards can compound large volume for office use Traditional compounding preserved and operates under current law As FDA implements the new law, AAO is working to ensure access to compounded and repacked drugs through the regulatory process

14 Vision Research Funding In the FY214 omnibus appropriations bill, NEI received $682 million, a 3 percent increase over federal FY213. While a positive development, this is still $19 million less than funding levels in place before the across-the-board cuts in federal spending caused by sequestration. The Defense Vision Trauma Research Program received $1 million in FY213 and FY214. The VTRP focuses on combat-related vision research and is the only dedicated funding source for extramural vision research into immediate battlefield needs.