CMS Releases Proposed Physician Fee Schedule for CY 2023, Expanding Accountable Care Organization Access (CMS-1770-P)

On July 7, the Centers for Medicare & Medicaid Services (CMS) issued the proposed calendar year (CY) 2023 Physician Fee Schedule, which proposes policies for physician payment and other outpatient services covered under Medicare Part B. See the press release here. CMS has provided a rule overview fact sheet and a Medicare Shared Savings Program proposal fact sheet. This rule proposes to:

Decrease the conversion factor for CY 2023, as compared to CY 2022,
Rebase and Revise Medicare Economic Index Cost Share Weights,
Refine Current Evaluation and Management Visit Policies,
Delay the split (or shared) evaluation and management visits policy,
Update the Quality Payment Program, including changes to the Merit-based Incentive Payment System Value Pathways (MVPs),
Include significant changes to the Medicare Shared Savings Program,
Maintain telehealth services added during the public health emergency (PHE) through 2023,
Revise the provider and supplier Medicare enrollment process,
Update vaccine administration payment,
Clarify policies regarding covid-19 vaccine and monoclonal antibody products,
Codify existing clinical laboratory fee schedule specimen collection and travel allowance payment policies,
Redefine skin substitute payment policy, and
Add four new remote therapeutic monitoring “G” codes.

This proposed rule also contains several requests for information, changes to behavioral health services delivery, among other proposals.

This proposed rule is scheduled to be published in the Federal Register on July 29, 2022, and comments are due by 5:00pm EDT on September 6, 2022.

CMS Proposes Decreased Conversion Factor, Rebases and Revises Medicare Economic Index Cost Share Weights

Physicians and other health professionals are paid under Medicare Part B for services that include office visits, surgical procedures, and other diagnostic and therapeutic efforts. To determine payment, Medicare uses a physician fee schedule (PFS) that is based on the relative resources typically used to furnish the service. These relative value units (RVUs) are applied to each service for physician work, practice expense (PE), and malpractice.

CMS multiplies these RVUs by a “conversion factor” to determine the Medicare payment amounts for each physician service. This year, CMS proposes to decrease the conversion factor by 4.4 percent, which reflects the finalized unadjusted CY 2022 conversion factor of $33.60 multiplied by an RVU budget neutrality adjustment of – 1.55 percent. Specifically, CMS proposes a conversion factor of $33.08, which is a decrease of $1.53 from the CY 2022 conversion factor of $34.61.[1] This means that each physician service will be paid over 4 percent less in 2023 than it was in 2022, except for services where CMS proposes changes to the RVUs or otherwise specifically proposes payment increases.

The Protecting Medicare and American Farmers from Sequester Cuts Act (PMA)[2] provided a 1-year 3.0 percent increase to the conversion factor that increased the CY 2022 finalized conversion factor from $33.60 to $34.61. CMS notes that the PMA required this increase not to be taken into account in determining the PFS payment rates for subsequent years. Therefore, the 2023 conversion factor was calculated as though the 3.0 percent increase for the 2022 conversion factor had never been applied.

TABLE 1. Physician Fee Schedule Conversion Factor (CF) Comparison[3]

CY 2022 Finalized CF	PMA Adjusted CF	Proposed 2023 CF[4]
33.5983	34.6062	33.0775

Overall, providers could be facing significant reductions in Medicare payments, including a 2 percent sequestration cut[5] that began on July 1, 2022 that is scheduled to continue through fiscal year 2031, along with a Pay-As-You-Go (PAYGO)[6] sequestration cut[7] that could occur in 2023 without congressional action.[8] Sequestration[9] is a budget enforcement tool that reduces federal spending when budget goals are not met.[10]

CMS to Rebase and Revise Medicare Economic Index Cost Share Weights

For CY 2023, CMS proposes to rebase and revise Medicare Economic Index (MEI) cost share weights from a 2006-base year to a 2017-base year in consideration of more current market conditions. The CMS Office of the Actuary developed the MEI, which consists of an index that measures market price changes of inputs used to provide physician services. CMS has historically used MEI cost weights to update geographic practice cost index (GPCI) weights to weigh four components of the GPCI PE, including employee compensation, office rent, purchased services, and medical equipment, supplies and other miscellaneous expenses.

CMS completed its most recent calibration for CY 2014 RVUs when the MEI was last updated. CMS will primarily rebase these rates from data provided by the U.S. Census Bureau’s 2017 Services Annual Survey (SAS), supplemented by other various data services.[11] The agency believes that the 2017 SAS data is the most recently available and complete data due to concerns about the COVID-19 pandemic’s impact on more recent data.

CMS estimates that proposed weights would not impact overall spending, but would significantly impact the PE GPCI. Therefore, in an effort to promote predictability in payments, CMS proposes not to use the rebased and revised MEI weights for the PE GPCI in CY 2023 and solicits comment on potential implementation timing for future rulemaking. Specifically, CMS proposes to maintain current use of 2006-based MEI cost share weights for CY 2023 GPCIs.

CMS notes that the use of 2006-based weights would have minimal impact on over 70 percent of localities’ PE GPCIs. [12]

CMS Proposes Refinements to Current Evaluation and Management Visit Policies

As with prior years, CMS is proposing to continue to refine and update coding and payment for evaluation and management (E/M) visits. In total E/M visits make up approximately 40 percent of all allowable charges under the PFS. [13]

The AMA CPT^®[14] Editorial Panel approved coding and updated guidelines for Other E/M visits that go into effect on January 1, 2023. In the CY 2021 PFS, CMS finalized policies for office/outpatient E/M visit coding and documentation, and the Agency is proposing to adopt similar policies for Other E/M visits (which include hospital inpatient, hospital observation, emergency department, nursing facility, home or residence services, and cognitive impairment assessment) effective January 1, 2023. In the CY 2023 PFS proposed rule, CMS proposes revising coding and documentation framework that would include CPT code definition changes (revisions to the Other E/M code descriptors), including:

New description times;
Updated guidelines for levels of medical decision making;
Choice of medical decision making or time to select code level (except for a few families like emergency department visits and cognitive impairment assessment, because they are not timed services); and
Elimination of the use of history and exam to decide code level. There would instead be a requirement for a medically appropriate history and exam.

CMS also proposes to create Medicare-specific coding payment of other E/M prolonged services.

CMS Proposes to Delay Split (or Shared) Evaluation and Management Visits Policy

In the CY 2022 PFS, CMS finalized a policy for split (or shared) E/M visits, specifically the definition of substantive portion of a visit as more than half of the total time spent. CMS is proposing to delay the split (or shared) visits policy until CY 2024.

This means that in CY 2023, as in CY 2022, physicians who provide split (or shared) visits will have the choice of history, physical exam, or medical decision making, or more than half of the total practitioner time spent to define the substantive portion, instead of using total time to determine the substantive portion.

CMS Focuses on Subgroups in MIPS Value Pathways

In the annual PFS rulemaking, CMS includes its proposals for the Quality Payment Program (QPP), which includes two tracks: Merit-based Incentive Payment System (MIPS) and Alternative Payment Models (APMs). MIPS includes four performance categories: quality, cost, improvement activities, and promoting interoperability.

In CY 2020 rulemaking, CMS finalized creation of the MIPS Value Pathways (MVPs), a reporting option for MIPS that the agency believes will provide a more cohesive participation experience by aligning activities from the four MIPS performance categories around a certain specialty, medical condition, or patient population. CMS proposes to move forward with this transition beginning with the 2023 MIPS performance year.

In the CY 2022 PFS final rule, CMS finalized seven MVPs that would be available for reporting beginning with the CY 2023 performance period/2025 MIPS payment year:

Advancing Care for Heart Disease;
Optimizing Chronic Disease Management;
Advancing Rheumatology Patient Care;
Improving Care for Lower Extremity Joint Repair;
Adopting Best Practices and Promoting Patient Safety within Emergency Medicine;
Patient Safety and Support of Positive Experiences with Anesthesia; and
Coordinating Stroke Care to Promote Prevention and Cultivate Positive Outcomes.

CMS proposes revisions to these seven MVPs based on quality measure changes. CMS also proposes five additional new MVPs:

Advancing Cancer Care;
Optimal Care for Kidney Health;
Optimal Care for Neurological Conditions;
Supportive Care for Cognitive-Based Neurological Conditions; and
Promoting Wellness.

CMS believes that subgroup reporting will allow for comprehensive measurement of clinician performance in MIPS because it allows clinicians to form subgroups and report on measures and activities relevant to the scope of care provided. CMS proposes subgroup reporting will be voluntary for CY 2023, 2024, and 2025 performance periods. Each subgroup must include at least one MIPS eligible clinician. Multispecialty groups that choose to report through an MVP will be required to participate as subgroups beginning with the CY 2026 performance period.

CMS does not propose any restrictions to the composition of a subgroup to allow flexibility for exploring the utilization of these subgroups. Multispecialty groups must submit a description of each subgroup at the time of registration.

CMS proposes limited changes under traditional MIPS to allow clinicians the time and consistency needed to gain familiarity with the MVPs.

CMS also proposes policies to encourage participation in Alternative Payment Models (APMs), in line with the Agency’s overall goals. This includes permanently establishing the eight percent minimum Generally Applicable Nominal Risk standard for Advanced APMs (currently set to expire in 2024).

Additionally, in the proposed rule, CMS is issuing multiple Requests for Information (RFIs) related to the future of the QPP, including:

How CMS should address the transition from a lump sum APM incentive payment to a percentage conversion factor update for QPs;
The development and implementation of health equity measures for the quality performance category;
Developing quality measures that address amputation avoidance in diabetic patients;
Whether third party intermediaries should have flexibility to choose which measures they will support within the MVP;
Allowing Continuing Medical Education (CME) Organizations to directly submit improvement activities for MVPs;
Opportunities to incentivize participation in TEFCA (the Trusted Exchange Framework and Common Agreement);
The use of Fast Healthcare Interoperability Resources (FHIR) in the QPP;
Changes in the way CMS makes QP determinations.

CMS Proposes to Advance Health Equity in the Medicare Shared Savings Program

In January 2022, over 11 million Medicare beneficiaries were enrolled in an accountable care organization (ACO) participating in the Medicare Shared Savings Program (MSSP)—the largest value-based purchasing program in the U.S. In the MSSP, an ACO agrees to be held accountable for the quality, cost, and experience of care for assigned fee-for-service (FFS) beneficiaries. Eligible healthcare providers and hospitals can participate in the MSSP by starting or joining an ACO. The MSSP consists of different participation tracks that allow ACOs to assume various levels of risk.

Based on stakeholder feedback and continuing recent efforts to improve health equity, CMS’s MSSP proposals aim to advance health equity for rural and underserved populations. In the CY 2023 PFS proposed rule, CMS proposes the following changes:

Providing advanced shared savings payments (referred to as advance investment payments) to low revenue ACOs that are inexperienced with performance-based risk initiatives, that are new to MSSP, and that provide care to underserved populations;
Strengthening program participation by increasing incentives for ACOs providing services to complex and high cost of care populations;
Transitioning ACOs to all payer quality measure reporting, implementing a health equity adjustment, and addressing social determinants of health (SDOH); and
Reducing the level of administrative burden for ACOs.

Additionally, signaling a commitment to health equity as it relates to quality measurement, CMS is seeking comment on a request for information (RFI) on the use of two SDOH eCQM/MIPS CQM outcome-oriented measures for ACOs and inclusion of CAHPS for MIPS survey questions specific to discrimination and price transparency. These SDOH eCQM/MIPS CQMs are identical to those CMS proposed in the recent Inpatient Prospective Payment System (IPPS) proposed rule for Hospital Inpatient Quality Reporting (IQR).

CMS is also seeking comment on an alternative approach to calculating ACO historical benchmarks that would use administratively set benchmarks.

CMS also proposes the establishment of a health equity adjustment to revise and improve the MSSP quality performance requirements for 2023 and future years. This adjustment would recognize and reward ACOs that serve a high population of underserved beneficiaries while delivering high quality care. Qualifying ACOs could receive a potential upward adjustment of up to 10 bonus points on the ACO’s MIPS quality performance score. The health equity adjusted performance score would be used to determine whether the ACO meets the quality performance standard set for performance year 2023 and subsequent years.

Medicare Will Preserve Telehealth Services Added During the Public Health Emergency Until the End of 2023

During the COVID-19 public health emergency (PHE), CMS greatly expanded flexibility for telehealth services. In the CY 2021 PFS final rule, CMS created a Category III for adding temporary Medicare telehealth services to the Medicare Telehealth Services List. CMS proposes to add several additional services to Category 3 on a temporary basis. The services that are temporarily included on the Medicare Telehealth Services list will be included through the end of CY 2023.

CMS provided additional comments on the following services:

Service	Comments
Telephone Evaluation/Management (E/M) Services	CMS received requests to add certain Telephone E/M visit codes to the Medicare Telehealth Services List on a Category III basis. The agency believes audio-only telephone E/M services are inherently non-face-to-face, and therefore, would not be appropriate to leave on the Medicare Telehealth Services List following the end of the PHE.
GI Tract Imaging and Continuous Glucose Monitoring	CMS received requests to add GI Tract Imaging and Continuous Glucose Monitoring to the Medicare Telehealth Services List on a Category III basis, The agency believes these services are inherently non-face-face and does not propose to add these services to the list; however, CMS seeks information on whether these services are inherently non-face-to-face and may be included on the list. Additionally, CMS seeks comment on whether these services would require an in-person visit when furnished without the use of a telecommunications system.
Neurotransmitter Pulse Generator/Transmitter	CMS received requests to add codes describing the electronic analysis of an implanted neurostimulator pulse generator/transmitter to the Medicare Telehealth Services List. For one code, the request indicated that the service could be furnished using two-way, audio-video technology, but it is currently unavailable. CMS will consider these additions when the communication technology becomes available. For other codes, CMS expressed concern with the scope of available technology and the safety of using telecommunications. CMS proposes to add CPT codes 95970, 95983, and 95984 to the Medicare Telehealth Services List on a Category III, while seeking comment on the safety and appropriate inclusion of these services.
Emotional/behavior assessment, Psychological, or Neuropsychological Testing and Evaluation services	CMS received requests regarding Emotional/behavior assessment, Psychological, or Neuropsychological Testing and Evaluation services. The agency proposes to include these services on the Medicare Telehealth Services List on a Category III basis but is concerned that the quality of services may be jeopardized outside of the PHE and seeks comment on patient safety concerns.
Other Services Proposed for Addition to the Medicare Telehealth Services List	CMS proposes to add several other services on a Category III basis, to allow the agency to evaluate data that may support the permanent addition of some services to the Medicare Telehealth Services List.

CMS Leverages Telehealth Provisions in the Consolidated Appropriations Act to Ease Transition Following End of PHE

In alignment with the Consolidated Appropriations Act of 2022[15] (CAA), CMS proposes to extend the services that are temporarily included on the telehealth services list during the PHE, but not on a Category 1, 2, or 3 basis, for 151 days following the end of the PHE. Using CAA flexibilities will allow: 1) for telehealth services to be furnished in any site in the US, 2) audio-only telecommunications systems for certain services, and 3) physical therapists, occupation therapists, speech-language pathologists, and audiologists to furnish telehealth services. Additionally, CAA provisions will delay the in-person visit requirements for services furnished via telehealth until 152 days after the end of the PHE.

CMS proposes that after 151 days following the end of the PHE, telehealth claims will require an appropriate place of service (POS) indicator on the claim, rather than the modifier “95.” Beginning January 1, 2023, CMS proposes to require qualified health care practitioners to use modifier “93” for audio-only Medicare telehealth services.

CMS Seeks Information on “Direct Supervision” Flexibility

Due to the PHE, CMS temporarily changed the definition of “direct supervision” for certain types of services that require supervision, allowing supervising professionals to be available through virtual presence rather than physical presence. While CMS is not proposing to make this permanent, the agency is seeking information on whether this flexibility should be made permanent.

Updated Telehealth Originating Site Fee

CMS proposes to update the telehealth originating site fee to $28.61 for HCPCS code Q3014.

CMS Proposes to Strengthen Medicare Provider and Supplier Enrollment Oversight

CMS proposes revisions to the provider and supplier Medicare enrollment process to strengthen program integrity. These changes include:

Allowing revocation based on Office of the Investigator General (OIG) exclusions and felony conviction;
Expanding the number of providers and suppliers subject to the highest level of screening, including skilled nursing facilities (SNFs), which requires fingerprinting all 5 percent or greater owners of those providers and suppliers; and
Adding a new DMEPOS condition of payment requiring DMEPOS suppliers to be in compliance with state licensure requirements[16] at the time an item or service is furnished in order to receive payment.

CMS states that the third proposal results from situations where an unlicensed DMEPOS supplier furnishes items for an extended period, then terminates their enrollment or CMS revokes their enrollment but CMS loses money because the supplier was furnishing items and services while unlicensed until the enrollment was terminated. CMS estimates that based on data collected, the proposed change will result in 6,100 claim denials per month involving $1.3 million in denied/unpaid claims.

CMS Proposes Annual Payment Updates for Preventative Vaccine Administration Services While Maintaining COVID-19 Vaccine Administration Payment Rate and In-Home Additional Payment

For CY 2023, CMS proposes to annually update the payment amount for the administration of Part B preventive vaccines to reflect changes in cost based upon the increase in the Medicare Economic Index (MEI). CMS also proposes to adjust this payment amount to reflect cost differences for the geographic locality using the Geographic Adjustment Factor (GAF). These adjustments would apply to HCPCS codes G0008, G0009, and G0010 effective January 1, 2023.

Regarding COVID-19 vaccine administration, CMS reiterated that the agency will maintain the current payment rate of $40 per dose, geographically adjusted, for the administration of the COVID-19 vaccines through the end of the calendar year in which the ongoing PHE ends. Thus, effective January 1 of the year following the year in which the PHE ends, the payment rate for COVID-19 vaccine administration will be set at a rate to align with the payment rate for the administration of other Part B preventive vaccines. CMS proposes to clarify that this policy would be dependent on the declaration under section 564 of the Federal Food, Drug, and Cosmetic Act (FD&C Act).

In addition, for CY 2023, CMS is proposing to continue the add-on payment of $35.50 when a COVID-19 vaccine is administered in a beneficiary’s home under the certain circumstances. CMS proposes adjustments for geographic cost differences by using the GAF and would update the $35.50 by the CY 2023 MEI.

CMS Clarifies Policies Regarding COVID-19 Vaccine and Monoclonal Antibody Products

CMS clarifies that its payment policies for COVID-19 vaccines and COVID-19 monoclonal antibody (mAb) products will continue until the until the EUA declaration for drugs and biological products is terminated.

Specifically, for COVID-19 vaccines and their administration, CMS will keep the current payment rate of $40 per dose for the administration of the COVID–19 vaccines through the end of the calendar year in which the March 27, 2020 EUA declaration under section 564 of the FD&C Act (EUA declaration) ends. Effective January 1 of the year following the declaration for drugs and biologicals end, the payment rate for COVID–19 vaccine administration will be set at a rate to align with the payment rate for the administration of other Part B preventive vaccines.

CMS proposes to continue to pay for COVID-19 mAbs under the Medicare Part B vaccine benefit through the end of the calendar year in which the EUA declaration is terminated. Until such time, CMS will maintain the payment rate for administering a COVID–19 mAb used for treatment or for post-exposure prophylaxis of COVID-19 in a healthcare setting, as well as the payment rates for administering a COVID–19 mAb in the home. Effective January 1 of the year following the year in which the EUA declaration for drugs and biological products ends, CMS would pay physicians and other suppliers for covered COVID–19 mAbs used for the treatment or for post-exposure prophylaxis of COVID-19 as biological products paid under section 1847A of the Act per the applicable payment system similar to the way they are paid for administering other complex biological products.

Beginning January 1, 2023, CMS proposes to apply the GAF to the payment amount for the administration of mAbs used for treatment or for post-exposure prophylaxis of COVID-19 so long as the EUA declaration is still in place. Regarding an update based upon the MEI, beginning January 1, 2023, CMS would not extend the proposal to update the payment amount for the administration of these products.

CMS clarifies that its policy of coverage and payment under the Part B vaccine benefit for mAbs includes those used as pre-exposure prophylaxis for prevention of COVID-19. CMS proposes to continue the existing policy to pay for these products and their administration under the Part B vaccine benefit even after the EUA declaration for drugs and biological products is terminated so long as such products have market authorization. CMS proposes applying the GAF to the payment amount for the administration of those mAbs, effective January 1, 2023 but not an update with the MEI.

As the payment amounts established for the administration of mAbs used as pre-exposure prophylaxis for COVID-19 were intended to account for resource costs associated with pandemic response, and like the payment amounts for administration of other COVID-19 mAbs, reflects an approximation. CMS expresses interest in maintaining the current amount without a specified update mechanism and seeks comment on how best to consider refining rates for administration of this specific kind of product in the future.

CMS Proposes Policies for Requiring Manufacturer Refunds for Discarded Single-Dose or Single-Use Drugs

Under current law,[17] drug manufacturers must provide a refund to CMS for certain discarded amounts from a refundable single-dose container or single-use package drug. The refund amount is equal to the amount of discarded drug that exceeds an applicable percentage, which is required to be at least 10 percent, of total charges for the drug in a given calendar quarter.

CMS includes several proposals to implement this policy:

How discarded amounts of drugs are determined:
- Proposes JW modifier[18] (or any successor modifier that includes the same data) to identify discarded billing units
- Proposes hospital outpatient departments (HOPDs) would be required to use the JW modifier or any successor modifier to identify discarded amounts of refundable single-dose container or single-use package assigned status indicator “K” (Nonpass-Through Drugs and Nonimplantable Biologicals, Including Therapeutic Radiopharmaceuticals) or status indicator “G” (Pass-Through Drugs and Biologicals)
- Proposes the JW modifier or any successor modifier to identify discarded amounts of refundable single-dose container or single-use package drugs assigned payment indicator “K2” (‘Drugs and biologicals paid separately when provided integral to a surgical procedure on ASC list; payment based on OPPS rate)
- Proposes requiring for dates of service on or after January 1, 2023 requiring the JW modifier be required on claims for all single-dose container or single use drugs for which any amount is discarded (as reflected in our current policy), and a separate modifier JZ be required on claims for these drugs when there are no discarded amount. This would mean for all claims for single use vials or single use packages payable under Part B, either the JW modifier would be used to identify any discarded amounts or the JZ modifier would be present to attest that there were no discarded amounts.
A definition of which drugs are subject to refunds (and exclusions):
- Proposes policy applies to drugs paid under Medicare Part B described as being supplied in a single-dose container or single-use package based on the FDA-approved labeling or product information
- Proposes exclusions per statute for radiopharmaceutical or imaging agents, certain drugs requiring filtration during the drug preparation process, and certain new drugs approved on or after the date of enactment of the Infrastructure Act (i.e., November 15, 2021) for which Part B payment has been made for fewer than 18 months. CMS also proposes per statute to exclude units that are packaged into the payment amount for an item or service and not separately payable
When and how often CMS will notify manufacturers of refunds:
- Proposes to send annual reports to manufacturers with information for each calendar quarter with reports sent no later than October 1 of each year. The first report would be no later than October 1, 2023. CMS proposes that the report should reflect claims data that is finalized by the end of the second calendar quarter (that is, June 30) of the year in which the report is sent.
When and how often payment of refunds from manufacturers to CMS is required;
- Proposes refunds be paid annually and paid no later than December 31 of the year in which the report was sent to the manufacturer except in circumstances where a dispute is pending.
Refund calculation methodology (including applicable percentages):
- Per statute, proposes the refund amount is equal to the estimated amount (if any) by which the product of 1) the total number of units of the billing and payment code for such drug that were discarded during such quarter and 2) the payment limit amount for the refundable single-dose container or single-use package drug exceeds an amount equal to the applicable percentage of the estimated total allowed charges for such a drug (less the amount paid for packaged drugs) during the quarter. The applicable percentage is 10 percent.
- CMS notes that the agency has authority to propose an increase of the applicable percentage for any drugs with unique circumstances, but does not propose increasing the percentage for any drugs in the rule. CMS indicates they are considering whether to adopt a higher applicable percentage for drugs that are diluted in hydrogel and administered via the pyelocaliceal route and solicits comments on this and other drugs with unique circumstances as described under section 1847A(h)(3)(B)(ii) of the Act that may warrant an increase in the applicable percentage.
A dispute resolution process:
- Proposes a dispute resolution process for manufacturers where they must assert any basis for contesting its refund calculation during the 30-day period following the issuance of the report. Response would be provided no later than 30 days after receipt of the dispute.
Enforcement provisions:
- Proposes periodic audits of manufacturers for compliance with this refund requirement and Part B medication claims to ensure the JW modifier, JZ modifier (if adopted), and discarded drug amounts are billed appropriately
- Proposes to codify civil monetary penalties outlined in statute as equal to the sum of the amount that the manufacturer would have paid as refund and 25 percent of such amount.

CMS to Codify Existing Clinical Laboratory Fee Schedule (CLFS) Specimen Collection and Travel Allowance Payment Policies

Under section 1833(h)(3) of the Act, CMS must provide a nominal fee for specimen collection for laboratory testing and a fee to cover transportation and personnel expenses for trained personnel to collect specimens from homebound patients and inpatients (not in a hospital).

Though CMS’ longstanding policies and practices regarding the statutory requirements for the laboratory specimen collection and travel allowance are outlined in Medicare Claims Processing guidance, the Office of Inspector General and others has noted inconsistencies regarding Medicare Contractor implementation of these policies and unclear or conflicting guidance to providers regarding the travel allowance. In response to comments received in the prior year’s rule regarding these payment policies and clarification, CMS proposes to:

Specify that CMS will pay $3 for all specimens collected in one patient encounter
Clarify that one specimen collection fee would be allowed for each single patient encounter – this means that, if different types or multiple specimens are drawn from one patient, only one specimen collection fee would be allowed
Indicate the specimen collection requirements that must be met for a specimen collection fee to be payable
Clarify the requirement that the specimen must be collected by a “trained technician” and that a specimen collected by a trained technician would have to be either blood collected through venipuncture or a urine collected by catheterization
Delete the section in the manual regarding physician specimen collection as codes exist to describe these services when performed by physicians under the PFS
Codify in regulations and make some modifications and clarifications regarding (1) general requirement, (2) travel allowance basis, (3) travel allowance amount, and (4) travel allowance amount calculation

If finalized, CMS would make conforming changes to the Medicare Claims Processing Manual, Chapter 16 to reflect changes or clarifications and remove sections that are no longer applicable.

CMS Redefines Skin Substitute Payment Policy

CMS currently uses the term “skin substitute” to define a group of products used to cover appropriate wounds with the intent of stimulating the healing process. CMS has previously defined skin substitutes as a category of “biological and synthetic products that are most commonly used in outpatient settings for the treatment of diabetic foot ulcers and venous leg ulcers.”[19] CMS has also clarified that this definition does not include bandages or standard dressing.

However, in response to concerns that this definition has led to confusion about the use of these products, CMS proposes to replace the term ‘skin substitute’ with the term ‘wound care management’ or ‘wound care management products’ beginning in 2024.

In the 2022 PFS Final Rule, CMS finalized a payment approach for synthetic skin substitutes[20] and established unique HCPCS “A” codes for ten synthetic skin substitutes. There, CMS indicated that these substitutes would be payable as add-on codes to appropriate surgical application codes (CPT codes 15271-15278) and would be contractor-priced. This is a departure from other skin substitute products, which have commonly been assigned HCPCS “Q” codes.

However, in response to concerns that the above policy has led to an inconsistent payment approach for skin substitutes, CMS proposes to treat skin substitutes in the physician office setting as incident to supplies beginning January 1, 2024. Consequently, resource costs for these products would be included in the establishment of PE RVUs for its associated service procedure. This means that these products would no longer receive separate payment under an average sales price (ASP) + 6 percent payment methodology.

Beginning January 1, 2024, CMS also proposes to assign “A” codes for all skin substitute products meeting criteria for a HCPCS Level II code, which would be contractor-priced.

CMS Proposes to Increase Behavioral Health Access

CMS proposes changes to the behavioral health services delivery to increase access to and quality of behavioral health treatment. CMS solicits comments on these changes to ensure beneficiary access to behavioral health services paid under the PFS. These changes include:

A proposal to change the supervisor requirement for Licensed Professional Councilors (LPCs) and Marriage and Family Therapists (MFTs). Under the current statute, LPCs and MFTs can only be paid under the PFS when working with, under the direct supervision of, the billing physician or provider. CMS proposes to change that requirement to be “general” rather than “direct” supervision to allow for broader access to payment for those LPC and MFT services.
Proposed changes to billing to allow for more comprehensive chronic pain treatment, that includes behavioral health services for those with chronic pain. CMS is also seeking comment on whether the PFS accurately identified how to adjust coding to accommodate for this change.
Proposed changes to coding to integrate services delivered by Clinical Psychiatrists (CPs) and Clinical Social Workers (CSWs) into primary care coding and billing.

CMS Proposes Four New Remote Therapeutic Monitoring HCPCS “G” Codes

CMS proposes to establish four new HCPCS “G” codes related to remote therapeutic monitoring (RTM); one pair of codes is designed to increase patient access to remote therapeutic monitoring services and a second pair is designed to lessen the supervisory burden of physicians and Non-Physician Practitioners (NPPs). Additionally, CMS proposes to make the current CPT codes 98980 and 98981 non-payable under Medicare.

CMS proposes the following CPCS “G” codes:

GRTM1. Remote therapeutic monitoring treatment management services, physician or NPP professional time over a calendar month requiring at least one interactive communication with the patient/caregiver during the calendar month; first 20 minutes of evaluation and management services.
GRTM2. Remote therapeutic monitoring treatment management services, physician or NPP professional time over a calendar month requiring at least one interactive communication with the patient/caregiver over a calendar month; each additional 20 minutes of evaluation and management services during the calendar month (List separately in addition to code for primary procedure).
GRTM3. Remote therapeutic monitoring treatment assessment services, first 20 minutes furnished personally/directly by a nonphysician qualified healthcare professional over a calendar month requiring at least one interactive communication with the patient/caregiver during the month.
GRTM4. Remote therapeutic monitoring treatment assessment services, additional 20 minutes furnished personally/directly by a nonphysician qualified healthcare professional over a calendar month requiring at least one interactive communication with the patient/caregiver during the calendar month (List separately in addition to code for primary procedure).

CMS also seeks comment about RTM devices such as the types of data collected using RTM devices, how the data that are collected solve specific health conditions and what those health conditions are, the costs associated with RTM devices that are available to collect RTM data, how long the typical episode of care by condition type might last, and the potential number of beneficiaries for whom an RTM device might be used by the health condition type.

CMS Seeks Comment on Potential Payment Changes for Dental and Oral Health Services

CMS aims to improve clarity and coding for Medicare fee-for-service (FFS) payment policies for medically necessary dental services. Specifically, CMS seeks comment on payment for dental services that are linked and significantly related to the outcome of other covered medical services, for example, dental examinations as a comprehensive workup prior to organ transplant or cardiac valve replacement surgery.

CMS also seeks comment on the establishment of processes for submitting dental services which are inextricably linked to other covered medical services for the agency’s consideration and review as well as on potential future payment models for dental and oral health services. CMS notes that should a payment change for the expansion of dental services eligible for payment under Medicare Part A and Part B be finalized in the CY 2023 PFS Final Rule, such a policy may be adjusted and subject to impact analysis with public comment in future rulemaking.

[1] This conversion factor includes the update from the Protecting Medicare and American Farmers from Sequester Cuts Act (PMA, Pub. L. 117-71).

[2] Pub. L. 117-71.

[3] See Table 136 on page 1438 of the unpublished rule.

[4] Includes a CY 2023 RVU budget neutrality adjustment of -1.55 percent.

[5] Budget Control Act of 2011 (Pub. L. 112-25).

[6] Pay-As-You-Go Act of 2010 (Pub. L. 113-139).

[7] PAYGO cannot reduce Medicare benefit payments and integrity spending by more than 4 percent.

[8] PAYGO can be triggered in situations where budget enforcement rules are not followed. Specifically, the American Rescue Plan Act of 2021 (ARPA, Pub. L. 117-2) triggered PAYGO for 2022, but the PMA deferred this impact to 2023.

[9] Sequestration was established under the Balanced Budget and Emergency Deficit Control Act of 1985, Pub. L. 99-177.

[10] https://sgp.fas.org/crs/misc/R45106.pdf.

[11] See page 463 of the unpublished rule of a list of these supplemental data sources.

[12] See page 1521 – 1522 of the unpublished rule for a detailed impact analysis.

[13] See page 299 of the unpublished rule.

[14] CPT is a registered trademark of the American Medical Association.

[15] Pub. L. 117-103.

[16] 42 C.F.R. § 424.57(c)(1)(ii)(A).

[17] Section 90004 of the Infrastructure Investment and Jobs Act (Pub. L. 117-9).

[18] The JW modifier has existed since 2003, and since 2017 its use has been required on claims for separately payable Part B drugs that include discarded amounts of single use vials or single use packages. Currently, there are no other modifiers to measure discarded units of Part B drugs.

[19] 85 FR 80605.

[20] 86 FR 64996.

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