Health Care Alert: Bittersweet News as CMS Publishes Final 2021 Medicare Physician Fee Schedule

Last week, the Centers for Medicare & Medicaid Services (CMS) issued the final 2021 Medicare Physician Fee Schedule (PFS). The recent COVID-19 pandemic has created a lasting impression on the delivery of health care services, and CMS has taken notice by making permanent changes to some telemedicine services and prompting increases in behavioral health reimbursement. However, in a budget neutral process, CMS reduced the conversion factor used to calculate rates by 10.2%, from $36.09 to $32.41, which will substantially impact a large group of providers, including emergency medicine physicians who are currently working on the front lines of the pandemic. Despite comments from the public requesting that CMS use its 1135 waiver authority to address pandemic-related issues and help reduce the negative impacts resulting from the budget neutrality requirement, CMS reiterated that the Secretary does not have such authority to make such exceptions. The nature of the budget neutral process is a shifting foundation of health care reimbursement whereby providers annually await the release to see whether their reimbursements are increased at the expense of their peers or vice versa. In some instances, providers can find themselves on both sides. Primary care providers (PCPs) may find themselves in that situation this year as CMS provided additional reimbursement for chronic care management and time spent with patients managing such conditions.

Specialists like PCPs managing chronic conditions, endocrinologists, rheumatologists, hematologists/oncologists and psychiatrists are all projected to see increases in reimbursement according to CMS. On the other hand, radiologists, pathologists, anesthesiologists and their CRNA and AA colleagues, thoracic and vascular surgeons, general surgeons and physical & occupational therapists are all projected to experience a reduction in reimbursement. Those providers whose compensation is determined based on wRVU production will experience similar changes as a result of this latest PFS.

The financial impact on providers has prompted some members of Congress to introduce H.B. 8702, titled, the “Holding Providers Harmless From Medicare Cuts During COVID-19 Act of 2020.” This bill as drafted would make providers whole by allowing them to continue to be paid in 2021 and 2022 what they would have received under the 2020 PFS because of the impacts of the pandemic. Office evaluation and management (E&M) codes are excluded from this bill which was introduced in the House on October 30, 2020.

Although reimbursement is largely the most significant impact in the 2021 PFS, other major changes released include the following:

• Addition of several CPT codes to the Category 1 of permanent telehealth delivery methods and the addition of several codes to the temporary Category 3 for use through the end of the year of the Public Health Emergency (Section 11.D.);
• Refinements to the values of certain E&M codes during the Public Health Emergency  which include the deletion of CPT code 99201 (Level 1 Office Visit, New Patient) and changes to CPT code levels 2-5 of the new and established office visit codes to be based either on the level of medical-decision making or time. In other words, the consideration of history and exam elements will no longer be a factor in determining the CPT code level (Section II.F.);
• Several changes to the Medicare Shared Savings Program ACO requirements including:
  • Changes related to the quality data they report by applying the Alternative Payment Model Performance Pathway model beginning in performance year 2021             
  • Revisions to the Shared Savings Program Quality Performance Standard;
  • Updates to the definition of primary care services used in beneficiary assignment; and
  • Revisions to the repayment mechanism arrangement policy; and
  • Application of automatic credit to ACOs for Consumer Assessment of Healthcare Providers and Systems (CAHPS) reporting requirement in performance year 2020. (For more information, please see the Quality Payment Program fact sheet) (Section III.G.).
• Updates to the Medicaid Promoting Interoperability Program requirements for Eligible Professionals which establishes the electronic clinical quality measures (eCQMs) on which Eligible Professionals must report in order to achieve success in this program. These measures are similar to those in the 2020 PFS, but the end date for the 90-day continuous period of reporting must end by October 31, 2021 to ensure that state Departments of Medicaid can issue Program payments before December 31, 2021. This may create some additional effort to meet this accelerated reporting deadline on the part of Eligible Professionals (Section III.F.);
• Requirement for electronic prescribing of controlled substances (Schedules II, III, IV, and V) for Covered Part D drugs with limited exceptions under the authority of Section 2003 of the SUPPORT Act (Section III.K.). This means that providers who are not already e-prescribing controlled substances must begin doing so. Note: This rule is effective on January 1, 2021, but will not be enforced until January 1, 2022. This was changed from the proposed PFS.

Additional key changes for the calendar year 2021 PFS are highlighted below:

Medicare Telehealth and Other Services Involving Communications Technology

• For CY 2021, CMS is finalizing the addition of the following list of services to the Medicare telehealth list on a Category 1 basis:
  • Group Psychotherapy (CPT code 90853)
  • Psychological and Neuropsychological Testing (CPT code 96121)
  • Domiciliary, Rest Home, or Custodial Care Services, Established Patients (CPT codes 99334-99335)
  • Home Visits, Established Patient (CPT codes 99347-99348)
  • Cognitive Assessment and Care Planning Services (CPT code 99483)
  • Visit Complexity Inherent to Certain Office/Outpatient Evaluation and Management (E/M) (HCPCS code G2211)
  • Prolonged Services (HCPCS code G2212)
• Additionally, CMS is finalizing the creation of a third temporary category. The list includes the addition of the following services to the Medicare telehealth list on a Category 3 basis:
  • Domiciliary, Rest Home, or Custodial Care Services, Established Patients (CPT codes 99336-99337)
  • Home Visits, Established Patient (CPT codes 99349-99350)
  • Emergency Department Visits, Levels 1-5 (CPT codes 99281-99285)
  • Nursing Facilities Discharge Day Management (CPT codes 99315-99316)
  • Psychological and Neuropsychological Testing (CPT codes 96130-96133; CPT codes 96136-96139)
  • Therapy Services, Physical and Occupational Therapy, All levels (CPT codes 97161-97168; CPT codes 97110, 97112, 97116, 97535, 97750, 97755, 97760, 97761, 92521-92524, 92507)
  • Hospital Discharge Day Management (CPT codes 99238-99239)
  • Inpatient Neonatal and Pediatric Critical Care, Subsequent (CPT codes 99469, 99472, 99476)
  • Continuing Neonatal Intensive Care Services (CPT codes 99478-99480)
  • Critical Care Services (CPT codes 99291-99292)
  • End-Stage Renal Disease Monthly Capitation Payment codes (CPT codes 90952, 90953, 90956, 90959, 90962)
  • Subsequent Observation and Observation Discharge Day Management (CPT codes 99217; CPT codes 99224-99226)
• CMS is finalizing a frequency limitation for subsequent nursing facility (NF) telehealth visits of one visit every 14 days.
• CMS clarified that licensed clinical social workers, clinical psychologists, physical therapists (PTs), occupational therapists (OTs), and speech-language pathologists (SLPs) can furnish the brief online assessment and management services as well as virtual check-ins and remote evaluation services.

Direct Supervision by Interactive Telecommunications Technology

• CMS is finalizing that direct supervision may be provided using real-time, interactive audio and video technology through the later of the end of the calendar year in which the Public Health Emergency ends or December 31, 2021.

Payment for Office/Outpatient Evaluation and Management (E/M) and Analogous Visits

• CMS is also clarifying the definition of HCPCS add-on code G2211(formerly referred to as GPC1X), previously finalized for office/outpatient E/M visit complexity, and refining our utilization assumptions for this code.
• CMS is also finalizing a separate payment for a new HCPCS code, G2212, describing prolonged office/outpatient E/M visits to be used in place of CPT code 99417 (formerly referred to as CPT code 99XXX).

Therapy Assistants Furnishing Maintenance Therapy

• CMS finalized Part B policy for maintenance therapy services which allows physical therapists (PT) and occupational therapists (OT) to delegate the furnishing of maintenance therapy services, as clinically appropriate, to a physical therapy assistant (PTA) or an occupational therapy assistant (OTA).

Medical Record Documentation

• CMS clarified that Physicians and Non-Physician Providers, including therapists, can review and verify documentation entered into the medical record by members of the medical team for their own services that are paid under the PFS.
• CMS clarified that therapy students, and students of other disciplines, working under a physician or practitioner who furnish and bill directly for their professional services to the Medicare program, may document in the record so long as the documentation is reviewed and verified (signed and dated) by the billing physician, practitioner, or therapist.