On July 13, 2021, the Centers for Medicare and Medicaid Services (CMS) released an advance copy of the calendar year (CY) 2022 Medicare Physician Fee Schedule (PFS) proposed payment rule. The proposed CY 2022 PFS conversion factor is $33.58, a decrease of $1.31 from the CY 2021 PFS conversion factor of $34.89. Changes to the Open Payments program are proposed, along with policies impacting telehealth and evaluation and management codes. Comments on the proposed rule are due by September 13.
“Over the past year, the public health emergency has highlighted the disparities in the U.S. health care system, while at the same time demonstrating the positive impact of innovative policies to reduce these disparities,” said CMS Administrator Chiquita Brooks-LaSure. “CMS aims to take the lessons learned during this time and move forward toward a system where no patient is left out and everyone has access to comprehensive quality health services.”
Open Payments
In the proposed rule, CMS offers a number of changes to the Open Payments program. Under the program, there are three categories of reported information: (1) general; (2) research; (3) ownership interests. Payments associated with research may be flagged for delayed publication to protect sensitive information related to research and development, but many payments in the general category have been flagged by reporting entities for delayed publication. CMS clarified that delaying the reporting of general payments is not permitted and that research-relayed payments do not have to be specifically outlined in the original research agreement to be reported as research payments.
CMS is also proposing to add a field to the reporting template for reporting payments to teaching hospitals to help them verify that the reported information is correct. Historically, the information reported has not been sufficient, leading to disputes between reporting entities and teaching hospitals. In the proposed rule, the added field would only be visible to the teaching hospital disputing the reported information.
CMS is further proposing to define physician-owned distributorships (PODs), a type of group purchasing organization, and make clear that PODs are required to report and self-identify under the Open Payments program.
Telehealth
CMS received several requests to permanently add various services to the Medicare telehealth services list effective for CY 2022. However, none of the requests met CMS’ criteria for permanent addition to the Medicare telehealth services list. The agency found that the codes did not meet the criteria for addition to the list on a Category 1 or Category 2 basis, citing concerns over patient safety, the ability of the services to be accurately and thoroughly performed via telehealth, and insufficient information to demonstrate a clinical benefit to Medicare beneficiaries.
Last year, CMS created a set of “Category 3” codes to designate telehealth services covered temporarily during the PHE, but for which CMS has not yet developed evidence sufficient to meet the requirements for permanent coverage. Currently, coverage of Category 3 codes lasts through the end of the calendar year in which the PHE ends, but CMS has proposed extending that expiration date to December 31, 2023. This is intended to allow more time to compile data on Category 3 codes, utilization levels of these services during the PHE, and give stakeholders more opportunity to develop support for the permanent addition of these services to the Medicare telehealth services list.
CMS is also seeking comment on whether to adopt a policy to permanently allow provision of direct supervision via telehealth. For Medicare purposes, direct supervision requires the physician to be physically present in the same office suite as the supervised non-physician, and immediately available to furnish assistance and direction throughout the performance of the procedure. The agency is considering whether or not it should make permanent the ability to fulfill direct supervision via interactive audio-video technology.
Furthermore, CMS intends to make the new virtual check-in code permanent. Communication Technology-Based Services (CTBS) are brief communication services conducted over different types of technology to avoid unnecessary in-person office visits. These services are virtual and do not replace services that would normally be performed in-person. CMS created HCPCS code G2252 to cover extended services delivered via synchronous communication technology, including audio-only. HCPCS code G2252 has been covered on a temporary basis only, but CMS proposed to permanently adopt it for CY 2022. The code is intended for situations where the acuity of the patient’s problem is not necessarily likely to warrant an in-person visit, but when more than 5-10 minutes is needed to make that assessment.
Payment Cuts
Recently, the American Medical Association (AMA) has called upon Congress to re-evaluate the Medicare physician payment system. In a letter, AMA raised concerns over Congressional “indifference” to an incoming pay cut of up to 9.75 percent on January 1, 2022. Congress had originally intended to end the two percent sequester originating from the Budget Control Act of 2011 in 2021, but recently extended it to at least 2030 to fund non-healthcare infrastructure initiatives.
AMA further cited the burden of a 4 percent statutory Pay-As-You-Go (PAYGO) sequester, likely for the next 10 years, as an added stressor to physician practices. Without intervention, this will be the first time that Congress has not waived the statutory PAYGO.
The proposed 2022 Medicare Fee Schedule also includes a 3.75 percent reduction to the Fee Schedule conversion factor, which caused an uproar of dissent from major healthcare organizations. The Consolidated Appropriations Act initially enacted a 3.75 percent increase in Fee Schedule payments to avoid cuts relating to budget neutrality adjustments during COVID-19.
The American Medical Group Association (AMGA) expressed comparable concerns about the conversion factor reduction and extended mandatory sequestration under the PFS proposed rule, similarly urging Congress to intervene and prevent cuts.
Evaluation & Management Codes
In the proposed rule, CMS provides its proposal for regulations codifying its long-standing guidance on billing for “split (or shared)” evaluation and management (E/M) visits. Split (or shared) visits are E/M visits provided in part by both physician and non-physician practitioners (NPPs). NPPs generally include nurse practitioners, physician assistants and clinical nurse specialists and are also known outside of the Medicare program by other names, such as advanced practice practitioners (APPs). The proposed regulations incorporate some changes from the historical guidance that introduce new opportunities and restrictions on split (or shared) visits.
Quality Payment Program
CMS is moving forward with MIPS Value Pathways (MVPs) as CMS notes that “MVPs allow for a more cohesive participation experience by connecting activities and measures from the 4 MIPS performance categories that are relevant to a specialty, medical condition, or a particular population.” To provide clinicians and third-party intermediaries with sufficient time to prepare for a shift to this new participation framework, CMS is proposing to begin transitioning to MVPs in the 2023 Merit-Based Incentive Payment System (MIPS) performance year.
ASP Drug Price Reporting
CMS is proposing to make regulatory changes to implement the CAA’s requirement that manufacturers of drugs or biologicals payable under Part B without a Medicaid Drug Rebate Agreement report ASP data. Starting with calendar quarters beginning on January 1, 2022, manufacturers will be required to report ASP for drugs and biologicals payable under Medicare Part B. CMS notes that manufacturers are accustomed to the existing ASP reporting requirements and that the new requirements will “preserve the status quo to the extent possible.” CMS proposes to amend the definition of “drug” to include an item, service, supply or product that is payable under Medicare Part B as a drug or biological. CMS notes that it is not persuaded to exempt repackagers from the new reporting requirements, but that it may propose to exempt them in the future, if warranted. Under the CAA, the HHS Office of Inspector General (OIG) is required to conduct periodic studies to identify NDC for self-administered drugs that are not covered under Medicare Part B. In these circumstances, CMS would apply the “lesser-of payment methodology.”