On November 1, 2019, the Centers for Medicare & Medicaid Services (CMS) issued a final rule that updates the Medicare Physician Fee Schedule (PFS) rates and policies for calendar year (CY) 2020 and expands Medicare coverage to opioid treatment programs (OTPs) that treat beneficiaries with opioid use disorder (OUD). In a fact sheet accompanying the final rule, CMS explains that “this final rule is one of several rules that reflect a broader Administration-wide strategy to create a healthcare system that results in better accessibility, quality, affordability, empowerment, and innovation.” Highlights from the final rule are explained below.

PFS rates for CY 2020

The CY 2020 PFS conversion factor will be $36.09, which is only a slight increase from the CY 2019 PFS conversion factor of $36.04. This new rate reflects a budget neutral adjustment based on changes to the relative value units (RVUs).

As CMS states in its final rule, “the PFS relies on national relative values that are established for the work, practice expense, and malpractice” categories, and are further adjusted for differences in geographic costs. These values are then “multiplied by a conversion factor to convert the RVUs into payment rates.” Since the PFS conversion factor changed only slightly, total payments to Medicare physicians will remain relatively unchanged. However, since there were changes made in each the work, physician expense, and malpractice RVUs categories, the impact of changes to the PFS for physicians will likely vary by specialty and service mix.

Evaluation and Management Services

In the final rule, CMS revises its payment policy for Evaluation and Management (E/M) services, which are a generic set of codes that physicians use to bill for common office visits. Currently, CPT codes distinguish general office visits based on the level of complexity, site of service, and whether the patient is new or established. In recent years, CMS has proposed changing E/M services by replacing its five-tier payment system with two blended rates and CMS even finalized a single payment rate for levels 2 through 4 in its CY 2019 final rule, which was summarized by the Health Law Pulse. Reversing its course, CMS rescinds these policies and retains 5 levels of coding for established patients and reduce the number of levels from 5 to 4 for office/outpatient E/M visits for new patients. CMS also changes the CPT codes by permitting practitioners to choose to document office/outpatient E/M level 2 through 5 visits by using either the medical decision making process or time spent by the reporting practitioner on the day of the visit, which includes face-to-face and non face-to-face time. The medical decision making process was redefined by the American Medical Association (AMA) Current Procedural Terminology (CPT) Editorial Panel for office/outpatient E/M visits, which worked in close coordination with CMS in regards to these E/M provisions. More detailed information regarding the AMA’s Panel’s proposals can be found here. In addition, CMS eliminates the requirement that history and exam selects the level of code for office/outpatient E/M visits, and history and exams will now only need to be performed when medically necessary.

Physician Supervision Requirements for Physician Assistants

CMS revises its general physician supervision requirement of physician assistants (PAs) in the Medicare program to give PAs greater flexibility in their practices. Under the final rule the physician supervision requirement for PA services will be met if a PA furnishes services in accordance with state scope of practice and other relevant state laws. When there are not relevant state laws governing physician supervision of PA services, CMS clarifies that the physician supervision of PAs requirement will be met if there is “documentation in the medical record of the PA’s approach to working with physicians in furnishing their services.” CMS states that this change was adopted in response to a request for information (RFI) on potential flexibilities and efficiencies that CMS could make to the Medicare program in which PA stakeholders commented on the autonomy under which most PAs currently practice.

Review and Verification of Medical Record Documentation

In an effort to reduce documentation burdens, CMS provides modifications to its documentation policy for physicians, PAs, and Advanced Practice Registered Nurses (APRNs), which includes nurse practitioners, clinical nurse specialists, certified nurse midwives, and certified registered nurse anesthetists. Under the final rule, CMS changes its policies so that physicians, PAs, and APRNs can simply review and verify (sign and date) documentation rather than having to re-document information that is already included in a patient’s medical record by other physicians, residents, medical students, PAs, and APRN students, nurses, or other members of the medical team. In the final rule, CMS explains that it simplifying and standardizing this policy to add new flexibility for physicians, PAs, and APRNs who are paid for their services under the PFS.

Quality Payment Program

Congress in the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) required CMS to end the Sustainable Growth Rate payment system and implement an incentive program, referred to as the Quality Payment Program. The Quality Payment Program is a two-track value-based reimbursement system; the two tracks are: The Merit-based Incentive Payment System (MIPS); and the Advanced Alternative Payment Models (APMs).

In the final rule, CMS creates a new MIPS Value Pathways (MVPs) framework for CY 2021. CMS explains that this framework will promote “interoperability measures and a set of administrative claims-based quality measures that focus on population health/public health priorities and reduce reporting.” Under MVPs, providers will only have to report on a limited number of specialty or condition specific measures, which is a change since providers are currently required to report on the Quality, Cost, Promoting Interoperability, and Improvement Activities categories. CMS states in the final rule that it is “committed to the transformation of MIPS, which will allow for: more streamlined and cohesive reporting; enhancing and timely feedback; and the creation of MVPs of integrated measures and activities that are meaningful to all clinicians from specialists to primary care clinicians and to patients.”

Medicare Coverage for Opioid Treatment Programs

In its press release, CMS states that as part of the Trump Administration’s efforts to deal with the opioid crisis, the final rule will implement Section 2005 of the Substance Use-Disorder Prevention that Promotes Opioid Recovery and Treatment (SUPPORT) for Patients and Communities Act by creating a new Medicare Part B benefit for opioid treatment programs (OTPs) that furnish opioid use disorder (OUD) treatment services.

Under this new benefit, the definition of OUD treatment services includes: “FDA-approved opioid agonist and antagonist treatment medications; the dispensing and administering of such medications (if applicable); substance use counseling; individual and group therapy; toxicology testing which includes both presumptive and definitive testing; intake activities; and periodic assessments.” In addition, CMS will require OTPs to be SAMHSA certificated in order to receive Medicare reimbursement for OUD medication-assisted treatment (MAT). OTPs that have been fully and continuously certified by SAMHSA since October 23, 2018 will be assigned a moderate risk level of categorical screening, and OTPs that have not been fully and continuously certified by SAMHSA since then will be assigned a high risk level of categorical screening. CMS believes that these classifications will reduce the burden on OTPs while still ensuring that newer OTPs are appropriately screened. OTPs will be reimbursed a bundled payment for the medication administered for episodes of care for a period of one week, and the bundled payment will consist of several different codes to account for varying beneficiary needs.

Medicare Telehealth Services

Since the CY 2003 PFS final rule, CMS has encouraged the public to submit comments regarding potential services that can be added or deleted from the approved list of Medicare telehealth services. For services requested that are similar to professional consultations, office visits, and office psychiatry services that are already on the approved list of telehealth services, CMS adds these requests to Category 1. For services that are not similar to those already on the current telehealth list, CMS adds these requests to Category 2. To determine if a request is similar to an already approved telehealth service, CMS looks at the similarities in the services and telecommunications systems used to deliver the service, such as the use of certain audio or video equipment. While CMS states in the final rule that it did not receive any requests from the public to add services to the approved telehealth list for CY 2020, it proposed adding three new HCPCS G codes for a bundled monthly episode of care for the treatment of OUD in its CY 2020 PFS proposed rule. In the final rule, CMS finalizes these codes (G2086, G2087, and G2088) and adds these codes to its Category 1 list. CMS states that it believes the face-to-face psychotherapy component of these OUD services is relatively similar to other required face-to-face services currently on the Medicare telehealth services list, and this similarity supports adding these services to the Category 1 list.

Care Management Services

To improve payment for care management and care coordination, CMS adopts several changes to these services. In the final rule, CMS increases payments for Transitional Care Management (TCM) services in an effort to increase the use of these services. TCM services are “care management services provided to beneficiaries after discharge from an inpatient stay or certain outpatient stays.” In the final rule CMS cited to a study that found that patients who receive TCM services have “demonstrated reduced readmission rates, lower mortality, and decreased health care costs.” CMS also creates a Medicare-specific add-on code for time spent beyond the time that is currently allotted for Chronic Care Management (CCM) services. CCM services are “comprehensive care coordination services per calendar month, furnished by a physician or non-physician practitioner managing overall care and their clinical staff, for patients with two or more serious chronic conditions.” Finally, CMS creates new coding and payment for Principal Care Management (PCM) services, which are CCM services for patients with only one high-risk disease. Furthermore, a patient will be eligible for PCM services if he or she has one chronic condition that is expected to last between 3 months to a 1 year, or until the death of the patient. This code revises the current CCM codes’ requirement that mandates that patients have two or more chronic conditions. CMS states that approximately 3 million unique Medicare beneficiaries receive care management services annually.

This Medicare PFS final rule will be effective on January 1, 2020, and public comments regarding the “Coding and Payment for Evaluation and Management, Observation and Provision of Self-Administered Esketamine” interim final rule are due no later than 5 p.m. on December 31, 2019 and may be submitted electronically through regulations.gov or by mailing comments to: Centers for Medicare & Medicaid Services, Department of Health and Human Services, Attention: CMS-1715-IFC, P.O. Box 8016, Baltimore, MD 21244-8016.

*Special thanks to Hayley White, Law Clerk and District of Columbia Bar license pending, for her assistance in preparing this post.