CMS Issues Final 2019 Physician Fee Schedule Rule

November 06, 2018

The Centers for Medicare & Medicaid Services (CMS) issued the 2019 physician fee schedule (PFS) final rule November 1. The rule addresses a wide range of topics from physician reimbursement to the Quality Payment Program (MACRA). Key elements of the rule are noted below.

Physician fee schedule: The rule proposes to update physician fee schedule rates by 0.25% in calendar year 2019, as required under MACRA. 

Evaluation and Management Coding (E&M):

  • Streamlining E&M documentation: In response to comments from WHA and others about the need to alleviate physician burnout that results from Electronic Health Record (EHR) documentation, CMS is streamlining E&M coding procedures for calendar year 2019 and beyond. Specific rule provisions that accomplish this goal include:
    • Removing redundancy in E&M visit documentation when that information is already in the patient record, and requiring physicians to focus their documentation on what has changed since the last visit or on pertinent items that have not changed.  
    • Eliminating the requirement to document the medical necessity of a home visit in lieu of an office visit.
    • Removal of potentially duplicative requirements for notations in medical records that may have previously been included by residents or other members of the medical team for E&M visits furnished by teaching physicians.
  • E&M Reimbursement changes: In the preliminary version of the rule, CMS proposed to collapse the payment rates for E&M levels two through five for office and outpatient visits into a single payment rate. CMS retreated from this position in the final rule in response to comments from WHA and other organizations.  Under the final version, only E&M levels two through four will be combined into one rate. Level five will remain as is to account for the higher costs of treating the most complex patients. Additionally, CMS backed off the proposed 2019 implementation date, and now seeks to implement these changes in 2021. CMS will also be streamlining additional E&M documentation requirements when the E&M coding levels are combined in 2021. 

Site-neutral payments:  In 2017, CMS implemented reductions to certain items and services in hospital outpatient provider-based departments, setting those rates at 40% of the outpatient prospective payment system (OPPS) rates. In the 2019 final rule, CMS is maintaining payment for these services at 40% of the OPPS amount for CY2019.  

Reimbursement for Technology-Based Communications:  The rule will pay separately for newly defined physician services that use communications technology. The new services that will be reimbursed under Medicare are “virtual check-ins”—brief, non-face-to-face appointments via communications technology; evaluation of patient-submitted photos; chronic care remote physiologic monitoring; and interprofessional internet consultation.  

Telehealth changes: Beginning January 1, 2019, CMS is adding two Healthcare Common Procedure Coding System (HCPCS) codes to the list of Medicare-covered telehealth services: G0513 and G0514, which describe prolonged preventive services in an outpatient setting. 

Payment for Medicare Part B drugs:  Among other changes, the rule implements a policy change on January 1, 2019, so that Medicare 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 (MACRA) changes:  The rule contains several changes to the Merit-Based Incentive Payment System (MIPS). Some of these changes include: 

  • Removing MIPS process-based quality measures that have been deemed as “low value” or “low priority.” 
  • Starting in the 2021 payment year, 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. 
  • Beginning in 2021, adding an additional exclusionary category for MIPS:  those clinicians who provide 200 or less covered professional services per year under the PFS.   
  • Starting in 2019, allowing clinicians who are not required to participate in MIPS to opt-in to the program.  

For further information on the final rule, contact WHA’s Vice President of Policy Development Laura Rose or Director of Federal & State Affairs Jon Hoelter

This story originally appeared in the November 06, 2018 edition of WHA Newsletter