CMS Issues Proposed 2019 Physician Reimbursement Rule

July 17, 2018

On July 12, the Centers for Medicare and Medicaid Services (CMS) issued the 2019 proposed rule on physician reimbursement. The rule addresses a wide range of topics of great interest to WHA members, including the following:

Physician fee schedule (PFS): The rule proposes to update physician fee schedule rates by 0.25% in calendar year 2019, as required under the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA).

Site-neutral payments: In the calendar year (CY) 2018 PFS proposed rule, CMS had implemented reductions to nonexcepted services in provider-based departments, setting those rates at 40% of the outpatient prospective payment system (OPPS) rates. In the 2019 proposed rule, CMS proposes to continue to allow nonexcepted provider-based departments to bill for nonexcepted services on the institutional claim and maintain payment for nonexcepted services at 40% of the outpatient prospective payment system amount for CY 2019. CMS also proposes to maintain this same PFS Relativity Adjuster for future years until updated data or other considerations indicate that an alternative adjuster or a change to this approach is warranted.

Telehealth: The rule proposes to expand access to telehealth services by paying clinicians for virtual check-ins—brief, non-face-to-face appointments via communications technology; paying clinicians for evaluation of patient-submitted photos; and expanding Medicare-covered telehealth services to include prolonged preventive services. 

Evaluation and Management documentation: Among other changes to coding and documentation requirements, the rule proposes to collapse the payment rates for levels two through five of evaluation and management codes—which make up about 20 % of allowed charges under the physician fee schedule.

Payment for Medicare Part B drugs: Among other changes, the rule proposes a policy change so that its payments for Part B drugs more closely match the actual costs of the medications being delivered. The proposed payment reduction for new Part B drugs from the rate of Wholesale Acquisition Cost (WAC) plus 6% to WAC plus 3%. This rate would only apply while average sales price data are unavailable.

Quality Payment Program changes: Several changes to the Merit-Based Incentive Payment System (MIPS) are proposed in the rule. Some of these changes include:
  • Removing MIPS process-based quality measures that have been deemed as “low value” or “low priority.”
  • Increasing the weight of the MIPS cost category to 15%, while lowering the weight of the quality category to 45%.
  • Overhauling the MIPS Promoting Interoperability category to allow consumers better access to their own health data, and to align the performance category requirements with the Promoting Interoperability Program proposed for hospitals in the inpatient prospective payment system (IPPS) rule
CMS said it would also explore ways to make health care costs more transparent and understandable to everyday patients. Much like previously proposed rules, the agency has included a request for information asking how standard charges should be defined, the type of pricing information that would be most helpful to seniors, details around out-of-pocket costs and whether patients should be told what Medicare actually pays for a given service.

Over the next few weeks, WHA staff will analyze this proposed rule and submit comments to CMS. Comments are due by September 10, 2018.

For further information on the proposed rule, contact Laura Rose, Vice President of Policy Development, or Jon Hoelter, WHA Director of Federal and State Relations.

This story originally appeared in the July 17, 2018 edition of WHA Newsletter