The purpose of the PQRS program, Physician Quality Reporting System, deals with obviously the threatened insolvency of the Medicare program. We have seen the calls for healthcare reform, although with the latest news coming out of Washington or out of Massachusetts, Medicare health or a healthcare reform has an uncertain future at this moment. We don't know if the bill will ultimately be passed.
But the bottom line is that there are some issues Medicare is facing insolvency. And it's based on the premise that as a fee-for-service program, quality of care is not really being promoted. So, they're looking to take some drastic measures and to transform Medicare from a passive purchaser to an active purchaser of quality services.
And they were looking to get some bang for their buck, in other words. They want to make sure that the care that's being delivered is quality healthcare that will obviously result in good patient outcomes as opposed for paying for more and more of the same type of healthcare which is leading to the higher cost.
The prescription for all of these is one aspect, the Physician Quality Reporting System. And the way they are transitioning to the future pay for performance system is to incentivize you through this PQRS program by presenting a bonus. If you successfully report and participate in this program, then you can realize a 2% bonus, 2% of all your total allowed Medicare payments for the year.
So, obviously, there are some incentives involved and it can be a pay-off for you. And you need to get involve anyways because that's where they're heading with this value-based purchasing. VBP is the future of Medicare, as we can see.
Even within the two bills that are in D.C. at this moment, they were looking to basically continue and extend Physician Quality Reporting System. They're also looking to change some aspects of the program to create some appeals and feedback processes. And, you know, bottom line we're seeing that they are attached to this system and they're going to improve on it in the next few years.
To give you a brief overview obviously, Physician Quality Reporting System is a voluntary program. It involves those patients that you see that are Part B recipients, a rare road Medicare recipients, also Medicare as a secondary payer. What is excluded from this is any Medicare advantage patients, beneficiaries. So, Medicare Part C is not included in this. You would not want to submit quality data codes for any Part C plans.
Right now, it's basically an incentive to get you participating. So, it's reporting-based. It is not performance-based. We will see in the near future where they will hence your payments based on how well you perform these measures. But as of this point and for the next few years, we still see that it's just based on reporting.
So, there are some reporting periods and those depend on the type of reporting that you choose to do. But you have a January 1 through December 31st, or a 12-month or a 6-month, to July 1st through December 31st. But with either of these reporting periods, there is a deadline on February 28, 2011 when you cannot submit anymore claims.
With this, you are looking at the submission of clinical quality data. We submit those actually on the claim form. And there are also other methods through a registry. And there is a new electronic health record option, reporting option. But what you're actually reporting are Category II codes which are some supplemental tracking codes in the CPT manual. And they indicate basic quality PQRS measures that are performed.
We've discussed the potential bonus payment. It's gone from 1.5% this year. It is now a 2% bonus. And ultimately, they are providing feedback reports. This year, the feedback reports changed dramatically from the previous year. And we'll show you some examples of those feedback reports that you can use within your practice to improve the processes.
What is the focus of these measures? Obviously, quality of care. They're looking for greater patient outcomes. So, we're looking at prevention of a big aspect of these measures, chronic care management obviously, because of the high cost involved with these chronic conditions, acute episodes of care, many procedural related episodes of care, resource utilization and coordination of care issues.
And overall, this whole thing is used to develop a measurement process for the overall purpose of improvement. And basically, they want to collect this data and refine and redefine the measures so that ultimately, you are improving everything.
Visit our CMS PQRS page for more insider information on PQRS updates.