Physician Payment and Reimbursement

Mixed News in Physician Payment Final Rule

November 5, 2018 9:27 am

A low-profile Medicare policy change in the rule is the newly opened door for payments to physicians for their use of technology-based communication tools and remote-patient monitoring.

Nov. 2—Leading physician advocacy groups are celebrating some provisions in the final rule issued by Medicare this week. But other components could cause problems.

Physician advocates hailed provisions related to evaluation and management (E/M) codes in the final rule for the Medicare Physician Fee Schedule, welcoming the changes from a proposed rule issued in July. In the final rule, the Centers for Medicare & Medicaid Services (CMS) delayed setting a single payment rate for level 2 through 4 outpatient E/M visits until Jan. 1, 2021.

“CMS acknowledges the thousands of comments received in response to their proposal to update E/M codes by finalizing the reduced documentation requirements, while delaying the proposed payment changes until 2021,” said Don Crane, president and CEO of America’s Physician Groups (APG). “Thus, for 2019 and 2020, practices will continue using the current coding and payment structure for E/M office and outpatient visits.”

Among various comments from advocates, the Association of American Medical Colleges (AAMC) had warned that the change would impact appropriate payments for complex patients. The delayed implementation of the E/M code changes was unlikely to make eventual implementation any easier.

“Blending payments rates in 2021 won’t necessarily reduce burden, especially with CMS’s newly required add-on codes,” said Anders Gilberg, senior vice president of government affairs for the Medical Group Management Association (MGMA).

In CY21, CMS will implement E/M add-on codes that describe the additional resources inherent in visits for primary care and for specific kinds of nonprocedural, specialized medical care, though the add-ons would not be restricted by physician specialty. These codes would be reportable only for level 2 through 4 office/outpatient E/M visits, and their use generally would not impose new documentation requirements on a per-visit basis, noted a CMS fact sheet.

At the same time, a new “extended visit” add-on code will be allowed for use only with level 2 through 4 office/outpatient E/M visits, to account for the additional resources required when practitioners need to spend extended time with the patient.

ACO Changes

The physician payment rule includes several changes to accountable care organizations (ACOs) in the Medicare Shared Savings Program (MSSP), beyond those included in a separate proposed rule issued in August. That earlier rule would require the 561 existing ACOs to switch into one of two tracks—and to take on downside risk within two years, instead of up to six years.

ACO advocates were pleased that CMS allowed a voluntary six-month extension for existing ACOs with participation agreements that expire on Dec. 31, 2018—and were encouraged by the methodology for determining financial and quality performance during that six-month performance period, which begins Jan. 1, 2019.

“This will afford them sufficient time to prepare for extending their agreements while CMS works on finalizing other program changes,” said Blair Childs, senior vice president of public affairs for Premier.

However, Childs was concerned that if an ACO extends its agreement period and changes its participant list between the six-month extension and the start of the new MSSP model, the ACO’s aligned beneficiaries could be significantly different for the two performance periods.

“This would make an ACO accountable for the quality and financial performance of some of its assigned beneficiaries with little opportunity to manage these beneficiaries’ care,” Childs said.

Other ACO changes include:

  • Allowing beneficiaries who voluntarily align with a nurse practitioner, physician assistant, certified nurse specialist, or a physician with a specialty not used in assignment to be prospectively assigned to an ACO if the clinician they align with is participating in an ACO
  • Revising the definition of primary care services used in beneficiary assignment
  • Reducing the MSSP core quality measure set by eight measures

New Technology Options

A lower-level policy change that could have far-reaching impacts for clinicians is the “newly opened door for reimbursement of technology-based communication tools and remote-patient monitoring tools,” said Carrie Nixon, JD, managing partner of the Nixon Law Group in Fairfax, Va.

The final rule included a first-time differentiation between telehealth and remote-patient monitoring tools, Nixon said in an interview. That separation was key because Medicare payment for telehealth is subject to strict statutory limitations on its provision in rural or underserved locations, as well as requiring patients to receive telehealth care at specific clinical sites.

“For a long time, people have been scratching their heads going, ‘How do we get around this without an act of Congress,” Nixon said.

The change will allow 11 new codes related to remote communication and monitoring. The new provisions move far beyond the single billing code for remote-patient monitoring that CMS allowed—for the first time—in 2018.

“Now we have a situation where physicians are able to make use of remote-patient monitoring technology, whether that is a platform a patient uses to interact with their providers or it is associated with some kind of device monitor,” Nixon said.

Technology, such as blood pressure or glucose monitors, that wirelessly transmits patient data from their home to providers can produce significant clinical benefits and reduce readmissions and avoidable use of emergency departments, she said. Despite previously being uncompensated by Medicare, the technology holds great potential to improve outcomes under new payment models, she said.

Other Provisions

The final rule implemented two changes to restrictions on physician self-referrals. One provision largely codified an existing documentation approach, William Mathias, a shareholder in the Health Law Group in Baker Donelson’s Baltimore office, said in an interview

A more significant change will allow physician signatures to be added to documentation requirements more often than once every three years per physician, as is the limit now for retroactive signatures.

“We have gotten some questions from clients about it,” Mathias said, referring to hospitals’ discovery of missing signatures when self-auditing their documentation. Failure to include such signatures could result in “technical violations” of self-referral rules.

The final rule cuts Part B drug payments based on the wholesale acquisition cost (WAC). Beginning Jan. 1, 2019, WAC-based payments for Part B drugs will have a 3 percent add-on instead of the current 6 percent addition.

“This change in policy will help curb excessive spending, especially for new drugs with high launch prices, and will also decrease beneficiary cost sharing,” wrote CMS officials.

Rich Daly is a senior writer/editor in HFMA’s Washington, D.C., office. Follow Rich on Twitter: @rdalyhealthcare 


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