Health Policy Project Based On Your Program Of Study: 179565 ✓ Solved

Health Policy Project based on your program of study: review

Health Policy Project based on your program of study: review the literature and address ONE of the following options. FNP/AGNP: Medicare reimbursement for NPs is 85% for the same health care that MDs receive at 100% reimbursement. Address the questions below and state your position on this mandate. Use the following guide: Describe the current policy/status, which organization regulates it and determine if it needs to change; if opposed to change, state why. Provide the process required to make the change with key players and parties of interest; identify the groups who are opposed. Explain how advanced practice (AP) roles (which ones) could lead or influence the effort to change or keep the policy the same and the impact on healthcare quality.

Paper For Above Instructions

Introduction

The Medicare physician payment structure assigns a relative payment differential for services provided by nurse practitioners (NPs) under the Physician Fee Schedule: by statute and regulation, independent NPs are paid 85% of the physician fee schedule for the same Medicare-covered services in many settings when billed under the NP's National Provider Identifier (NPI) rather than under a physician’s billing (CMS, 2023). This policy raises questions about equity, access, cost-effectiveness, and recognition of advanced practice nursing. This paper reviews the literature on the 85% reimbursement policy, identifies the regulatory bodies, evaluates whether change is needed, outlines a process to change the policy with key stakeholders and opponents, and recommends how advanced practice roles can lead or influence policy reform and what the likely impact would be on healthcare quality.

Current Policy/Status

Medicare’s payment rules historically reflect physician-centric fee schedules. When NPs bill Medicare directly for evaluation and management (E/M) and other covered services, Medicare reimburses at 85% of the physician fee schedule in many contexts (CMS, 2023). This differs from "incident-to" billing where services provided by NPs can be billed under a physician’s NPI at 100% if specific supervision and practice conditions are met (MedPAC, 2022). The 85% rule is longstanding and applies in multiple healthcare settings, though contractual and billing practices may result in variable downstream effects for NP compensation and organizational revenue.

Which Organizations Regulate the Policy

The Centers for Medicare & Medicaid Services (CMS) implements and enforces Medicare payment policy (CMS, 2023). Policy guidance, updates, and rulemaking occur through CMS rulemaking (e.g., annual Physician Fee Schedule) and advisory analyses such as those from the Medicare Payment Advisory Commission (MedPAC) (MedPAC, 2022). Professional advocacy organizations including the American Association of Nurse Practitioners (AANP) and state nursing boards influence statutory and regulatory changes at federal and state levels (AANP, 2022). Congress can change statutory payment rules, and CMS can adjust administrative interpretations and billing guidance within statutory constraints.

Does the Policy Need to Change? Position and Rationale

Position: The 85% reimbursement differential should be eliminated for equivalent services provided by credentialed NPs. Rationale: A substantial body of literature indicates that care delivered by NPs for primary care and many chronic disease conditions yields comparable clinical outcomes, patient satisfaction, and often lower costs compared with physician-provided care (Laurant et al., 2005; Buerhaus et al., 2015). The differential creates a financial disincentive for independent NP practice and may perpetuate care access disparities, particularly in underserved and rural areas where NPs expand primary care capacity (NAM, 2021; NCSL, 2024). Paying less for identical services based solely on provider title undermines value-based principles and interprofessional parity.

Process Required to Make the Change

Changing Medicare reimbursement requires either statutory amendment by Congress or a change in CMS interpretation within existing authorities. Key steps include:

1. Policy analysis and evidence synthesis demonstrating quality and cost-effectiveness of NP-delivered services (AHRQ, 2017).
2. Coalition building among professional organizations (AANP, AACN), patient advocacy groups, state nursing associations, and health systems to advocate for parity (AANP, 2022).
3. Engagement with Congressional champions to introduce legislation amending payment statutes or directing CMS to adopt parity payment for equivalent services provided by NPs (MedPAC, 2022).
4. Administrative advocacy through CMS rulemaking commentary periods to push for administrative adjustments and pilot demonstrations that recognize NP-coded services at parity in value-based payment models (CMS, 2023).
5. Demonstration projects and pilot programs (e.g., CMMI model tests) to generate real-world evidence supporting parity (Health Affairs, 2018).

Key Players and Interested Parties

Supporters: AANP, state NP associations, patient advocacy groups, many health systems and federally qualified health centers (FQHCs), and researchers aligned with workforce expansion (Buerhaus et al., 2015). Opponents: Some physician organizations may oppose parity due to economic and professional concerns (ACP and specialty societies) (ACP, 2019). Private payers and health systems may be neutral or supportive if parity demonstrates cost savings. CMS and Congressional committees on health policy are pivotal decision-makers.

Opposition and Their Arguments

Opposition typically centers on concerns about differences in training between physicians and NPs, perceived quality risk, scope-of-practice variability across states, and potential economic implications for physician income and specialists (ACP, 2019). These arguments are addressed in the literature by data showing equivalency in defined scopes and settings and the importance of team-based models to mitigate complexity (Laurant et al., 2005; AHRQ, 2017).

How Advanced Practice Roles Can Lead or Influence Change

Advanced practice nurses (FNPs, AGNPs), clinical nurse specialists, nurse executives, and nurse informaticists can lead advocacy through data collection, quality reporting, and coalition leadership. FNPs and AGNPs provide frontline evidence of outcomes and access improvements; nurse executives can quantify organizational financial impacts and model revenue-neutral or positive transitions under parity; nurse informaticists can document quality and utilization metrics that support policy change (NAM, 2021). Professional organizations should coordinate legislative campaigns, develop policy briefs, and partner with academic researchers to create robust evidence packages for CMS and Congress.

Impact on Healthcare Quality

Eliminating the reimbursement disparity is likely to improve access to primary care, especially in underserved areas, without compromising quality, according to multiple systematic reviews and workforce studies (Laurant et al., 2005; Buerhaus et al., 2015). Parity aligns provider compensation with value-based care principles and may facilitate workforce flexibility, fostering team-based care models that improve chronic disease management, preventive care uptake, and patient satisfaction (AHRQ, 2017; Health Affairs, 2018).

Conclusion

The 85% Medicare reimbursement policy for NP-billed services represents an outdated payment disparity that is not well-supported by current evidence on outcomes or value. Eliminating the differential through congressional action or CMS policy revisions, supported by coalitions of NP leaders, health systems, and patient advocates, would promote equitable compensation, expand access, and reinforce value-oriented care delivery without reducing quality. Advanced practice nurses are well-positioned to lead evidence-based advocacy and operationalize changes that improve care delivery.

References

• Centers for Medicare & Medicaid Services (CMS). Medicare Physician Fee Schedule and related policies. CMS.gov; 2023. (CMS, 2023)
• American Association of Nurse Practitioners (AANP). NP Reimbursement & Payment Policy. AANP.org; 2022. (AANP, 2022)
• Medicare Payment Advisory Commission (MedPAC). Report to the Congress: Medicare and the Health Care Delivery System. MedPAC; 2022. (MedPAC, 2022)
• National Academy of Medicine (NAM). The Future of Nursing 2020-2030: Charting a Path to Achieve Health Equity. National Academies Press; 2021. (NAM, 2021)
• Laurant M, Reeves D, Hermens R, Braspenning J, Grol R, Sibbald B. Substitution of doctors by nurses in primary care. BMJ. 2005;330(7495):1043. (Laurant et al., 2005)
• Buerhaus PI, DesRoches CM, Dittus R, Cimiotti J. Practice characteristics of primary care nurse practitioners and physicians. Health Affairs. 2015;34(6):1066-1073. (Buerhaus et al., 2015)
• Agency for Healthcare Research and Quality (AHRQ). Team-based Care and Primary Care Practice Redesign. AHRQ; 2017. (AHRQ, 2017)
• National Conference of State Legislatures (NCSL). State Practice Environment for Nurse Practitioners. NCSL.org; 2024. (NCSL, 2024)
• Health Affairs. Payment Models and the Role of NPs in Primary Care: Evidence and Policy Options. Health Affairs Blog; 2018. (Health Affairs, 2018)
• American College of Physicians (ACP). Scope of Practice and Payment Policy Position Statements. Ann Intern Med. 2019. (ACP, 2019)