On November 1, 2019, CMS released the Calendar Year (CY) 2020 Physician Fee Schedule (PFS) final rule (the Final Rule). The Final Rule updated payment policies, payment rates, and quality provisions for services furnished under the PFS. A display copy of the Final Rule is available here and the CMS fact sheet is available here. The Final Rule is scheduled to be published in the Federal Register by November 15, 2019.

Payment Updates

CMS finalized a CY 2020 conversion factor of $36.09, a slight increase from the CY 2019 conversion factor of $36.04. PFS payments are based on the relative resources—Relative Value Units (RVUs)—required to furnish services, with the conversion factor applied. CMS also finalized technical improvements related to practice expenses and refinements to standard rates to reflect premium data involving malpractice expense and geographic practices cost indices.

The Final Rule also made a number of coding changes.

• First, the agency focused on opioids. It expanded physicians’ ability to utilize telehealth to treat opioid use disorders, with CMS adding three new HCPCS codes (G2086, G2087, and G2088). CMS also finalized a new Medicare Part B benefit, including new coding and payment requirements for bundled episodes of care, for the management and counseling for opioid use disorder (OUD) by Opioid Treatment Programs (OTPs) pursuant to Section 2005 of the Substance Use-Disorder Prevention that Promotes Opioid Recovery and Treatment for Patients and Communities Act (SUPPORT Act). OUD services include medications, administration of medications, substance use counseling, therapy, toxicology testing, intake activities, and periodic assessments. OTPs must meet accreditation and certification standards, and enroll in Medicare, in order to receive Medicare payment.
• Second, it revised (effective 2021) office/outpatient Evaluation and Management (E/M) visit coding depending on site of service. For established patients (CPT codes 99211-99215), CMS will pay on five different levels. For new patients (CPT codes 99202-99205), CMS will pay on four different levels. In the CY 2019 PFS final rule, CMS planned to make blended payments (consolidating levels two through four) as of 2021. The agency has reversed course on that policy following stakeholder objection. CMS also revised E/M coding definitions, including time/medical decision-making requirements and removing the use of history and/or physical exam in setting the code level. Patient history and exams are required only where medically appropriate. CMS also increased payment for office/outpatient E/M visits based on recommendations by the American Medical Association Specialty Society Relative Value Scale Update Committee.
• Third, CMS increased payments for transitional care management (CPT 99495, 99496) and now allows concurrent billing of transitional management codes with care management codes (prolonged services without direct patient contact, home and outpatient international normalized ratio monitoring, ESRD services, interpretation of physiological data, complex chronic care management services, and care plan oversight services). CMS also finalized a policy to use a new G-code (G2058) for chronic care management services reflecting increments of clinical staff time.
• Fourth, CMS revised outpatient occupational therapy (OT), physical therapy (PT) and speech-language pathology (SLP) regulations (42 C.F.R. §§ 410.59, 410.60) to reflect changes required under the Balance Budget Act of 2018, clarifying that, as a condition of payment, practitioners must use the “KX” modifier confirming medical necessity if the annual per-beneficiary incurred expense is over a threshold amount (currently $3,000 for OT and $3,000 for PT and SLP combined). Claims exceeding the threshold but lacking the modifier will be denied. The agency also elaborated on modifiers CQ and CO used to identify therapy services furnished in whole or in part by therapy assistants. “In whole or in part” has proven complicated to implement, even in defining it as more than 10% of the therapeutic minutes as compared to therapist, excluding time when therapist and assistant are working on the same patient for the same service. CMS “intend[s] to provide further detail regarding examples of clinical scenarios to illustrate [its] final policies” through information posted to CMS.gov.

CMS also revised the Open Payments Program, (which publishes annual data on financial relationships between physicians/teaching hospitals and applicable manufacturers and group purchasing organizations), CMS expanded the definition of “covered recipient” at 42 C.F.R. § 403.902, modifying payment categories at 42 C.F.R. § 403.904(e)(2), and standardizing data on reported medical devices. The agency made a number of refinements to measures within the Medicare Shared Savings Program, including establishing ACO 43 (Ambulatory Sensitive Condition Acute Composite Prevention Quality Indicator) as pay-for-reporting, rather than performance, for CY 2020 and 2021 due to changes in the measure. It proposed, but did not finalize, the removal of ACO 14 (Preventative Care and Screening: Influenza Immunization).

Lastly, CMS made a number of revisions to the Quality Payment Program (QPP). For the CY 2020 Merit-Based Incentive Payment System (MIPS) 2020 performance period (affecting 2022 payments), CMS set the performance threshold at 45 points (exceptional performance at 85 points). The same as 2019, the quality performance category is weighted at 45% of the total, cost at 15%, promoting interoperability at 25%, and improvement activities at 15%. Each category’s data and performance requirements were also revised. Key changes included strengthening the Qualified Clinical Data Registry measure standards to require measure testing, harmonization, and clinician feedback. CMS also finalized its proposed episode-based measures in the cost category to more accurately reflect costs for specialists, as well as proposed per capita cost and Medicare Spending Per Beneficiary measures. CMS finalized a performance threshold of 60 points (85 for exceptional) for the 2021 performance period. The agency did not announce the category weights for 2021. The CY 2020 QPP FAQs are available here. CMS’s QPP fact sheet is available here, which includes a summary table of how the measures have changed. Finally, CMS announced that it is continuing to move from the MIPS program to the MIPS Value Pathways (MVPs) program, which it says will reduce physician burden, but did not finalize specifics.