Medicare Program--Revisions to Payment Policies and Five-Year Review of and Adjustments to the Relative Value Units and Physician Fee Schedule Update for Calendar Year 1997 Notice

OGC-97-9: Published: Dec 9, 1996. Publicly Released: Dec 9, 1996.


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Pursuant to a legislative requirement, GAO reviewed the Health Care Financing Administration's (HCFA) new rule on revisions to the Medicare Program's payment policies and 5-year review of and adjustments to the relative value units under the physician fee schedule for calendar year 1997 and its physician fee schedule update for calendar year 1997 and physician volume performance standard rates of increase for fiscal year (FY) 1997 notice. GAO found that: (1) the rule would make several policy changes regarding Medicare payment for physician services and changes in geographic payment areas and procedure status codes to correct certain inequities in physician payments discovered since the establishment of physician fee schedules in January 1992; (2) the rule would also make changes to work relative value units which affect payment for physician services; (3) the final notice announces the calendar year 1997 updates to the Medicare physician fee schedule and the FY 1997 volume performance standards rates of increase for expenditures for physician services under the Medicare Supplementary Medical Insurance Program; and (4) HCFA did not comply with all applicable requirements in promulgating the rule, since it improperly accelerated the rule's effective date.

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