CMS Releases Final Physician Fee Schedule With 'Significant' E/M Overhaul

Kerry Dooley Young

November 04, 2019

Federal officials have finalized the 2020 physician fee schedule that includes major changes in payments and policies for office visits, opioid treatment, and supervision rules for physician assistants.

The Centers for Medicare & Medicaid Services (CMS) released the new Medicare rule on Friday. The final rule carries several changes in Medicare's approach to evaluation and management (E/M) services, which are slated to take effect in 2021.

These include simplifying the documentation of continuing care of patients with serious and complex chronic conditions. The American Medical Association (AMA) on Friday praised this aspect of the rule, calling it the "first overhaul of E/M office visit documentation and coding in more than 25 years."

"This new approach is a significant step in reducing administrative burdens that get in the way of patient care," said Patrice A. Harris, MD, president of the AMA, in a statement. "Now it's time for vendors and payors to take the necessary next steps to align their systems with E/M office visit code changes by the time the revisions are deployed on January 1, 2021."

The American Medical Group Association also applauded the E/M coding changes. In a statement, AMGA said it had been concerned about an earlier CMS proposal that would have collapsed E/M levels 2 through 5. Instead, the final rule opted to assign a separate payment rate to each of the office and outpatient E/M visit codes.

AMGA also said it agreed with CMS' decision to maintain the level 1 visit code for established patients. AMGA had recommended this approach, as the level 1 code helps facilitate a team-based approach to care delivery and allows various members of the care delivery team to develop a relationship with a patient.

"A team-based approach to care requires an infrastructure to support it," said Jerry Penso, MD, MBA, AMGA president and CEO, in the statement. "It also requires the right policies and a payment system that will maintain that infrastructure. This change goes a long way to helping our members deliver the best possible care."

CMS Sticks With Controversial Rule

In the final rule, CMS stuck with another aspect of its E/M changes that had angered clinicians in some specialities. It plans adjustments in 2021 that may boost certain pay for some specialties, while lowering it for others. This approach earlier drew an outcry from groups targeted for reductions after CMS released the proposed physician fee rule in July.

CMS said it received many suggestions from medical organizations about strategies to soften the financial impact of E/M payment changes. These included phasing the changes in over 4 or 5 years, capping increases or decreases, conducting claims-based analysis, and working with Congress.

For now, CMS said it is not poised to adopt these suggestions.

"Given that these revised codes and values do not take effect until CY 2021, and we do not know the magnitude of redistribution resulting from other policies we may adopt through rulemaking before then, we believe it would be premature to finalize a strategy in this final rule," CMS said in the rule. "However, we intend to consider these concerns and address them in future rulemaking."

In an article posted on the AMA website, the organization said it remains concerned about "significant payment reductions anticipated for some physicians." The AMA said it intends to work with CMS to persuade the agency that all specialties' payments for office visits should be recognized as equivalent.

Physician Assistants Get "Greater Flexibility"

The physician fee rule also will give physician assistants (PAs) "greater flexibility to practice more broadly in the current health care system in accordance with state law and state scope of practice," CMS said in a press release.

"We believe that, in the absence of state law, if there is documentation at the practice which demonstrates the working relationship that PAs have with physicians in furnishing their professional services, then this would be adequate to ensure that the statutory requirement for PA physician supervision is met," CMS said in the rule.

The American Academy of PAs (AAPA) welcomed the change.

"Deferring to states on how PAs work with other healthcare providers ensures that Medicare policy aligns with the direction many states are already heading [in] when it comes to how healthcare is delivered," said David E. Mittman, PA, president and chair of the board of directors for AAPA, in a statement.

Separately, the rule also creates new coding and payment for a monthly bundle of services for the treatment of opioid abuse. This includes overall management, care coordination, individual and group psychotherapy, and substance use counseling, as well as an add-on code for additional counseling.

Telehealth services can be used for certain individual psychotherapy, group psychotherapy, and substance use counseling, CMS said.

Revocation of Medicare Rights

CMS also stuck with its intention to create a pathway for revoking or denying Medicare participation to clinicians who have harmed patients. Many medical groups had protested against these provisions in the draft rule.

In the final rule, CMS said it received suggestions that it should withdraw these provisions and instead work with medical organizations to address their concerns.

"We respectfully decline to delay finalization of these provisions. We believe they are needed for the reasons described previously in this rule," CMS said. "Nonetheless, we always welcome feedback from provider organizations and would be pleased, after this rule is published, to hear any remaining concerns they may have."

In response to the draft rule, some organizations told CMS they feared this new authority to revoke Medicare participation could cause some clinicians to avoid seeking counseling for burnout. Other comments to CMS called this provision "an unprecedented overreach of the federal government's authority," the agency said.

There also were questions about whether CMS was venturing into matters best left to the expertise of state oversight boards' medical professionals.

CMS said state medical boards play a "very crucial" role in protecting patients, but are not exclusively responsible for this function.

"Given this, we respectfully submit that CMS is not and should not be prohibited from taking action against a Medicare provider merely because the state oversight board may disagree with such action," the agency said. "That is, while we generally give great deference to state oversight boards and their judgments, there could be instances where CMS, in its oversight of Medicare, feels compelled to review a matter."

Some commenters noted how a revocation of Medicare billing could also cause a physician to be terminated from Medicaid and private plans, "which could devastate the individual's medical practice," CMS said.

In the final rule, CMS stressed that it intends to restrict the new revocation authority to "significant cases of patient harm." The agency expects this would thus affect few clinicians.

As an example of the need for the greater authority, CMS cited a case of a physician who was placed on probation, fined, and suspended by a state board after multiple accusations by his patients for sexual assault. But the physician was permitted to maintain his medical license, during which time he continued to sexually assault additional patients, CMS said.

"It was not until multiple years after the initial fine and probation period that the state finally revoked his medical license, and it was only after this license action that CMS was able to revoke the physician's Medicare enrollment," CMS said. "However, with our new patient harm provisions, CMS could have taken immediate action based on the initial probation, fine, and suspension, thus perhaps avoiding the subsequent patient abuse that occurred."

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