Hello Roberta Buell,

Medicare finally put out their 2024 Proposed Rules for both Physicians and Hospital Outpatient facilities. While drug payment has not changed much, there are loads of new codes for other services. And, these actually scare me because some overlap a bit with Care Management codes. And, as we all know, there has been a lot of confusion with those codes. But, while the new codes may be a problem, they also may be an opportunity. Check them out.

Bear in mind that this is a preliminary look at Proposals.

Remember that these are proposed rules, so there is no reason YET to panic about a 3.35% cut to the Physician Office conversion factor . But, physician offices take a big hit every single year, which is certainly not sustainable. You all have until September 11, 2023 to comment--And, no, I don't know if they take GIFs and emojis.

The other craziness is that CMS (Coding Might Suck) is reviving that wild and crazy add-on E/M code G2211--remember that one? Wait until you read about how they are going to limit utilization.

And, in addition, in this edition, besides the usual Proposed Rules offices and hospitals, CMS issued a Proposed Rule for the repayment of the 340B cuts which, as you may know, were declared illegal by the Supremes. Hospitals will be getting a windfall of cash, but read the fine print, folks--there are small cuts coming for years and years, if that proposal stands.

To assist you in understanding these rules, we will be doing a webinar on July 25, 2023 (12 noon EDT, 11 CST, and 9 in the morning for those of us on the West Coast). Everyone is welcome!!! Sign up here!

Thanks to all of you who sent love and prayers to my dog, Trey. He has recovered from his serious dietary indiscretions, but my new carpet has not. Many thanks again.

Best,

Da' Mistress

Last week, the Centers for Medicare & Medicaid Services (CMS) issued the Calendar Year (CY) 2024 Physician Fee Schedule (PFS) and Quality Payment Program (QPP) PROPOSED regulation. As a reminder, the proposed PFS and QPP regulation is the annual PROPOSAL outlining coverage, coding, and Medicare payments for physicians and other health care practitioners for the next calendar year. This is a preliminary look at these proposed rules, so nothing is etched in stone.

The rates included in PFS often serve as the basis of many private payers' reimbursements. Fortunately, some payers only use the RVUs, not the conversion factor. The proposal also includes updates to the Merit-based Incentive Payment System (MIPS) and the Quality Payment Program. These rules generally take effect on dates of service starting January 1, 2023. Comments are due September 11, 2023.

TOP TAKEAWAYS FROM THE PFS PROPOSED RULE

• Conversion Factor-- CMS has proposed a 2024 physician conversion factor (CF) of $ 32.7476. This represents a 3.36% reduction from the 2023 physician conversion factor of $33.8872. The proposed CF is the result of a statutory 0% update scheduled for the PFS in 2024, a negative 2.17% budget neutrality adjustment, and an actual increase (1.25%). There has been a stealth outpouring of negativity regarding this cut. Congress has been asked by many specialties to permanently fix physician payment, but, in 2024, we may be stuck with this.
• The GPCI Floor--In some areas, CMS has plugged in a 1.00 Work RVU to bolster payment in certain locations. This has been in place for many years. The change could be significant for some folks. But, take heart, this has been proposed many times and then it never happens. So, we will see.
• Specialty Impact--The specialty impact below estimate does not factor in the full 3.36% reduction in the CF. So, when you crunch the 2024 numbers, there may be a decrease that could be drastically different from this: 

+ Cardiology: 0%

+ Dermatology -1%

+ Family Practice +3%

+ Gastro 0%

+ Hem-Onc +2%

+ Neurology +1%

+ Radiation Oncology -2%

• It's Baaack--G2211--. CMS finalized add-on code G2211 in the 2021 PFS final rule, but it had significant budget implications, since the CMS estimated it would be billed in a high percentage of all office visit claims. So, this was not considered to be good for the Federal Budget. In December 2020, Congress passed the Consolidated Appropriations Act of 2021, which delayed G2211 until 2024. CMS has proposed to reinstitute the code to active status in 2024. However, in the proposal, the agency significantly revised the code rules and now estimates that billing of G2211 will be reduced. TAKE A GUESS WHY--you cannot ever bill this anytime you use Modifier -25!!! While the proposal states this is for minor procedures, this may also include drug admin. As my Nana would say, oy vey.
• Split/Shared Visits--CMS is proposes to not make time the only documentation criteria for split visits in 2024 as originally planned. Instead, they propose to maintain the current definition of the “substantive portion” of an E/M service performed by both a physician and a non-physician practitioner in a facility setting through 2024. Clinicians who furnish the split/shared visit will continue to have a choice of a substantial portion of the three old E/M components, history, physical exam, medical decision making. Alternatively, more than half of the total practitioner time spent can also demonstrate who should bill. CMS has again delayed changing the definition of “substantive portion” to allow time to consider comments from providers and evaluate how this should be treated in the future. Meanwhile, Modifier FS is still in the picture and, for those of you in Provider Based Facilities, you are subject to these rules for office visits.
• Behavioral Health--The proposed changes would allow marriage and family therapists (MFTs) and mental health counselors (MHCs), including substance use disorder counselors, to enroll in Medicare and bill for their services. They will be paid at the lower of 80% of the actual charge or 75% of the PFS. They can also provide telehealth if what is proposed is finalized.
• Telehealth--As you may know, the CAA extended many telehealth services until the end of 2024. CMS is proposing several updates to the Medicare Telehealth Services List for 2024. In addition the 2024 proposal contains several other provisions for telehealth.
• The agency proposes to add Health and Wellbeing Coaching Services to the Medicare Telehealth Services List on a temporary basis in 2024 (CPT codes 0591T-0593T)
• The new code for Social Determinants of Health Risk Assessments (GXXX5 for now) may be added to the list on a permanent basis
• CMS proposes that, beginning in 2024, telehealth services furnished to people in their homes be paid at the non-facility PFS rate, thereby protecting access to telehealth services by aligning with the telehealth-related flexibilities that were extended via the Consolidated Appropriations Act of 2023. As you may know, the POS for the patient being at home is 10.
• In a move that we should all love, CMS proposes to continue to define “direct supervision” that means that the supervising practitioner can continue to be present and available through real-time audio and video interactive telecommunications through December 31, 2024. CMS stated in the proposal that they are soliciting comments on whether it should consider extending the policy beyond December 31, 2024.
• Teaching physicians have been supervising Residents virtually since the beginning of the Pandemic . But, that was supposed to expire 12/31/2023. In the proposal, CMS states that they will continue to allow teaching physicians to have a virtual presence during the key portion of the Medicare telehealth service for which payment is sought, through audio/video real-time communications technology, for all residency training locations through December 31, 2024.
• CMS proposes to collapse Category 1 and 2 telehealth services into one permanent level. And, proposes to call Category 3 "provisional".
• CMS also will lift frequency limits on 99231-99233 among other services if the proposal is accepted.
• Caregiver Support--There are codes that Medicare proposes to pay for in terms of Caregiver Training (96202, 96203, 9X015, 9X016, 9X017). CMS posits that they will pay for certain caregiver training services in specific circumstances, so that HCPs are appropriately paid for supporting caregivers who help people with Medicare enact their treatment plans. Medicare did mention some of the conditions for which they will pay. Conditions include but are not limited to, stroke, traumatic brain injury (TBI), various forms of dementia, autism spectrum disorders, individuals with other intellectual or cognitive disabilities, physical mobility limitations, or necessary use of assisted devices or mobility aids.
• Advancing Health Equity--To maximize Health Equity, CMS has proposed new coding and payment for several services to help underserved populations. Some of these duplicate the Care Management coding spectrum and may cause even more confusion.
• The agency proposes to allow separate coding and payment for community health integration services (GXXX1-GXXX2 for now), which would include person-centered planning, health system coordination, promoting patient self-advocacy, and allowing access to community-based resources to address unmet social needs that interfere with the clinician's diagnosis and treatment plan for the patient. Called "CHI", this code set is for 60 minutes per calendar month with an add-on code for an additional 30 minutes
• Navigators, heads up! Another new proposed payment is for Principal Illness Navigation ("PIN") services to help patients navigate their main treatment in the complicated healthcare world. By the way, cancer was specifically mentioned in use of this code. This code set is (GXXX3-GXXX4 for now). The other thing that is mentioned is that this can be billed with other Care Management codes as this is considered to be a complementary code to Principal Care Management. In addition, there is patient cost sharing.
• The proposal also includes coding and payment for Social Determinants of Health Risk Assessments, (GXXX5 for now) which could be furnished as an add-on to an annual wellness visit (with no cost sharing) or in conjunction with an E/M visit. This assessment must be achieved with an evidenced-based assessment tool.
• Drugs and Biologicals Rules Under the IRA Codified--This proposal which formalizes a lot of things that were in The Inflation Reduction Act contains several provisions that affect payment allowables or beneficiary out-of-pocket costs for certain drugs payable under Part B. In this proposed rule, CMS addresses the following
• Section 11403 makes changes to the payment limit for certain biosimilars when they are new and this is way wacky, people. So, the payment limit for the biosimilar is the lesser of (1) an amount not to exceed 103 percent of the WAC of the biosimilar or the Medicare Part B drug payment methodology in effect on November 1, 2003 (!!!), or (2) 106 percent of the lesser of the WAC or ASP of the reference biological, or in the case of a selected drug during a price applicability period, 106 percent of the maximum fair price (2028?) of the reference biological. If finalized, this goes into effect on July 1, 2024.
• Section 11101 requires that beneficiary coinsurance for a Part B rebatable drug is to be based on the inflation-adjusted payment amount if the Medicare payment amount for a calendar quarter exceeds the inflation-adjusted payment amount, We have already seen how this works.
• Section 11407 provides that for insulin furnished through an item of DME on or after July 1, 2023, the deductible is waived and coinsurance is limited to $35 for a month’s supply of insulin furnished through a covered item of DME.
• More Part B Drug Proposals--Here is more drug news from the Medicare proposal.
• Drugs and Biologicals which are Not Usually Self-Administered by the Patient, and Complex Drug Administration Coding:CMS is soliciting comments regarding policies on the exclusion of coverage for certain drugs under Part B that are usually self-administered by the patient. In addition, they are seeking comment on coding and payment policies for drug administration in complex non-chemotherapeutic drugs, Specialties outside of Hem-Onc are not thrilled that their drugs are not considered "complex". And, no one is thrilled with drug admin payment.
• Rules requiring Manufacturers of Certain Single-Dose Container or Single-Use Package Drugs to Provide Refunds with Respect to Discarded Amounts. This has been implemented as of July 3, 2023. But, there are proposals that include:
• Timelines for the initial and subsequent discarded drug refund reports to manufacturers are proposed in this draft rule. The first report will be preliminary and will occur before 12/31/2023.
• The method of calculating refunds for discarded amounts from lagged claims data, The proposal is that eight quarters of data will be in each report.
• The method of calculating refunds when there are multiple manufacturers for a refundable drug, The proposal is that, for generics in a single HCPCS code, it will be a weighted average of all NDCs for single dose containers. This information will come from the reporting manufacturers' quarterly ASP. Report
• Higher percentages for certain drugs with unique circumstances such as teeny tiny dosing.. Many of these are ophthalmology, but low volume orphan drugs are included.
• An application process by which manufacturers may request an increased applicable percentage for a drug with unique circumstances.
• CMS proposes modification to the JW and JZ modifier policy for drugs payable under Part B from single-dose containers given through DME that are furnished by a supplier who does not administer the drug. They only report -JZ.
• Payment for Dental Services Prior to Certain Cancer Treatments--CMS is helping cancer patients everywhere by proposing that payments can be made for selected dental services (no crowns or implants) prior to and during several different cancer treatments, including:
• Chemotherapy
• CAR-Ts
• Bone modifiers (e.g. biphosphonates)
• Vaccines--In June 2021, CMS announced an additional payment for in-home COVID-19 vaccine administration, which was established on a preliminary basis during the PHE. Based on data that show that this payment has helped improve healthcare access to vaccines for underserved Medicare populations, CMS proposes to maintain this additional payment for the administration of a COVID-19 vaccine in the home. CMS is also proposing to extend this in-home additional payment to the administration of the other three preventive vaccines included in the Part B preventive vaccine benefit — the pneumococcal, influenza, and hepatitis B vaccines — when provided in the home.
• Under this proposal, effective January 1, 2024, the payment amount for administration of all four vaccines would be identical, That is, Medicare Part B will pay the same additional payment amount to providers and suppliers that administer a pneumococcal, influenza, hepatitis B, or COVID-19 vaccine in the home.
• This additional payment amount (proposed at $38.51) will be annually updated using the percentage increase in the Medicare Economic Index and adjusted to reflect geographic cost variations.
• CMS proposes to limit the additional payment to one payment per home visit, even if multiple vaccines are administered during the same home visit. Every vaccine dose that is furnished during a home visit will still receive its own unique vaccine administration payment.
• The AUC Program--This silly thing has been on the books for many years. Now, CMS is saying they do not know HOW they would process these claims without upsetting the entire payment system. CMS now wants to pause efforts to implement the Appropriate Use Criteria (AUC) program for reevaluation and to rescind the current AUC program regulations at 42 CFR 414.94. CMS will continue efforts to identify a workable implementation approach and will propose to adopt any such approach through subsequent rule-making.
• Electronic Prescribing for Controlled Substances (EPCS)--This will be monitored in 2024 with Warning letters as it has been in 2023. The biggest thing here is that practices and clinics with in-house pharmacies are now subject to the 70% rule, if finalized.
• The Quality Payment Program Proposals for 2024--Here are some of the major proposals for the Quality Payment Program next year:
• Merit-Based Incentive Payment System (MIPS) Performance Threshold: CMS is proposing to increase the MIPS performance threshold from 75 to 82 points under all three MIPS reporting options: traditional MIPS, MIPS Value Pathways (MVPs), and Alternative Payment Model Performance Pathways (APPs).
• Components of MIPS: These will remain the same in 2024: 30% Quality; 30% Cost, 15% Improvement Activities; and 25% Promoting Interoperability.
• MVPs: In an effort to expand the MVP option for more specialties, CMS is proposing 5 more MVPs for 2024:
• Women's Health
• Infectious Disease Including HIV and Hepatitis C
• Mental Health and Substance Abuse Disorder
• Quality Care for Ear, Nose, and Throat
• Rehab Support for Musculoskeletal Disease
• Consolidation of Promoting Wellness and Managing Chronic Conditions
• Quality: Data completeness is 75%% for 2024 and 2025 performance periods. will go to 80% in 2026.
• Cost: There will be five new episode-based measures with a 20 case minimum and one removal:
• Depression
• Emergency Medicine
• Cardiac Failure
• Low Back Pain (which I am getting from writing this)
• Psychoses and related Conditions
• Simple Pneumonia with Hospitalization will be removed.
• Improvement Activities: CMS proposes to add 5 new activities; modify one activity; and, remove 3 activities.
• Promoting Interoperability: The biggest thing proposed for 2024 is that the performance period will go from 90 to 180 days.
• APMs--In accordance with the Consolidated Appropriations Act of 2023, the Alternative Payment Model (APM) Incentive Payment for Reporting Year 2023 is 3.5% (from 5%). After the 2023 performance year/2025 payment year, the APM Incentive Payment will end. Beginning with the 2024 performance year/2026 payment year, qualifying participants (QPs) will receive a higher Medicare PFS update (“qualifying APM conversion factor”) of 0.75% compared to non-QPs, who will receive a 0.25% Medicare PFS update, which will result in a higher PFS payment rate for eligible clinicians who are QPs. APM QPs will continue to be excluded from MIPS reporting and payment adjustments for the year. Other proposals include:
• Qualifying APM Participants: CMS proposes to make QP determinations at the individual eligible clinician-level only and no longer the APM Entity-level.
• Proposed Medicare APM Thresholds. Under current statute, the QP threshold percentages will increase beginning with the 2024 performance year/2026 payment year as follows:
• ​Medicare Payments:QP threshold increasing from 50% to 75%; Partial QP threshold increasing from 40% to 50%
• Medicare Patients: QP threshold increasing from 35% to 50%; Partial QP threshold increasing from 25% to 35%.

This rule is voluminous. If you treat diabetes, substance abuse, behavioral issues, or PT/OT patients, please review the rule or the fact sheet for more information. We could not include everything here.

And, don't forget to sign up for our webinar on July 25th (12 noon EDT)!!!

The Centers for Medicare & Medicaid Services (CMS) recently posted its calendar year (CY) 2024 Proposed Rule for Hospital Outpatients ("OPPS")). Like the Physician Rule, comments are welcome until September 11, 2023.

For CY 2024, CMS proposes to increase payment rates under the Hospital Outpatient Prospective

Payment System (OPPS) and the ASC Payment System by a factor of 2.8%. Hospitals and ASCs that

fail to meet their respective quality reporting program requirements are subject to a 2.0% reduction in

the CY 2024 fee schedule increase factor.

Key takeaways from the CY 2024 OPPS System Proposed Rule:

• Drug Payment--Medicare will continue to pay hospitals ASP plus 6%. The packaging amount for drugs in 2024 is proposed to be $140. CMS is proposing “to exempt biosimilars from the OPPS threshold packaging policy when their reference biologicals are separately paid, meaning we would pay separately for these biosimilars even if their per-day cost is below the threshold packaging policy.”
• 340B Modifiers--CMS also proposes to use only a single modifier to identify separately payable drugs and biologicals acquired under the 340B program. Currently, 340B hospitals report the “JG” or “TB” modifiers to identify drugs and biologicals acquired through the 340B program. CMS (author of the meaningless modifier -JZ) states that “utilizing a single modifier will allow for greater simplicity,” while also continuing to identify and exclude 340B-acquired drugs and biologicals for the purpose of Part B inflation rebate liability. CMS proposes that all 340B covered entity hospitals paid under the OPPS would report the “TB” modifier effective January 1, 2025.
• Potential Buffer Stock of Essential Medications: To cushion the impact of drug shortages, CMS is proposing to provide an additional payment as part of the inpatient prospective payment system to support the creation of a buffer supply of medications. CMS indicated that it will consider a similar payment under OPPS in future years.
• Bundling of Radiopharmaceutical--Interested parties have long complained about the bundling of diagnostic Radiopharmaceuticals. Finally, it seems the Agency is listening. CMS has previously heard from interested parties regarding alternative payment methodologies, such as subjecting diagnostic Radiopharmaceuticals to the drug packaging threshold (similar to the other drug packaging) and creating separate APC payments for diagnostic Radiopharmaceuticals with a per-day cost greater than $500. Five alternatives were mentioned in the 2024 proposal:
• Paying separately for diagnostic Radiopharmaceuticals with per-day costs above the OPPS drug packaging threshold of $140
• Establishing a specific per-day cost threshold that may be greater or less than the OPPS drug packaging threshold
• Restructuring APCs, including by adding nuclear medicine APCs for services that utilize high-cost diagnostic Radiopharmaceuticals
• Creating specific payment policies for diagnostic Radiopharmaceuticals used in clinical trials
• Adopting codes that incorporate the disease state being diagnosed or a diagnostic indication of a particular class of diagnostic Radiopharmaceuticals
• Transparency-- CMS proposes to broaden enforcement of the hospital price transparency requirements by requiring hospitals to use a template to submit charge information and by publicizing the enforcement actions it has taken against hospitals.

Here are some of the details:

• CMS increased the maximum daily penalties for noncompliance to cost between $300 and $5,500 per day, depending on the hospital’s number of beds beginning in 2023. Some hospitals may have regarded this as a cost of doing business. It has been enforced in 4 facilities to date, so let's be careful out there!
• In November 2022,CMS made available several sample templates that hospitals could voluntarily use to make public their standard charge information in a machine-readable format. But, this still did not inspire every hospital.
• For CY 2024, CMS proposes to require hospitals to display standard charge information using a machine-readable file template similar to those it made available for voluntary use. CMS proposes to require hospitals to link to this information from their website homepage.
• CMS also seeks additions and modifications to its enforcement regulations, including requiring an authorized hospital official to certify the accuracy and completeness of hospital price transparency data requiring hospitals to acknowledge receipt of warning notices; allowing CMS to notify a health system’s leadership of noncompliance by one of its hospitals; and allowing CMS to publicize information related to CMS’s assessment of a hospital’s compliance and actions/remedies taken.
• In this rule, CMS requests information on how best to coordinate hospital price transparency requirements with Transparency in Coverage and No Surprises Act requirements.
• Behavioral Health--CMS outlines plans to implement the Intensive Outpatient Program ("IOP")benefit. The CAA of 2023, established Medicare coverage for intensive outpatient services beginning in CY 2024. Intensive outpatient services are furnished under IOPs, which are distinct outpatient programs of psychiatric services provided for individuals who have an acute mental illness, including conditions such as depression, schizophrenia and substance use disorders.
• In this rule, CMS proposes the payment and program requirements for the new IOP benefit.
• The proposed rule includes the scope of benefits, physician certification requirements, coding and billing and payment rates under the IOP benefit.
• CMS proposes that IOP services may be furnished in hospital outpatient departments, community mental health centers, federally qualified health centers and rural health clinics.
• Revisions to the Inpatient Only List--For CY 2024, CMS proposes to remove no procedures from the IPO list. CMS proposes to add nine services that were newly defined by the American Medical Association CPT Editorial Panel for CY 2024 to the IPO list. These new services are described by the placeholder CPT codes X114T, 2X002, 2X003,2X004, 619X1, 7X000, 7X001, 7X002 and 7X003.
• Dental Services--In 2023, CMS began to allow payment for dental services that are inextricably linked to, and substantially related and integral to, the clinical success of other covered medical services. This policy change allows payment for certain dental services performed in outpatient settings when OPPS coverage and payment conditions are met. To ensure that CMS can pay for dental services under OPPS, the agency now proposes to assign 229 additional dental codes to clinical APCs. The full list of those codes can be found in table 53 of the OPPS proposed rule. CMS wants some feedback on this list.

To read the entire rule, click here. To get the summary, click here.

The Department of Health and Human Services has published a proposed rule to address reduced payments for Part B drugs for 340B hospital outpatients from 2018 to September 2022. We have been expecting this for a while now and anticipated it to be part of the Proposed Rule for HOPPS 2024. Instead, it a standalone proposal.

On June 15, 2022, the Supreme Court unanimously held that the HHS failed to follow the requirements of the Medicare Statute for changing reimbursement methodology for drug acquisitions for hospitals that participate in the 340B discount drug program. Because HHS failed to follow the Statute’s requirements, the Court ordered that HHS must fund underpayments stemming from the 22.5% drug reimbursement cut for 340B providers. This occurred from January 2018 through September 2022 and the shortfall must be reimbursed to 340B providers by HHS.

In the proposed rule, HHS estimates that the reimbursement cut to 340B providers from January 2018 to September 2022 was approximately $10.5 billion. HHS estimates that the reimbursement methodology change put in place by HHS starting September 27, 2022 has corrected $1.5 billion of that amount. Many of the 2022 claims have been re-processed. Thus, HHS is proposing lump sum payments to 340B providers totaling approximately $9 billion.

HHS is proposing to pay this shortfall by examining claims data for each and every 340B provider from January 1, 2018 to September 27, 2022 . HHS will calculate these payments based on the full amount a 340B provider should have been reimbursed had the payment reductions not gone into effect, and then subtract from that total what HHS has already compensated the 340B provider for the claims. HHS states in the proposed rule that it does not believe it has the authority to account for interest on these claims, thus no interest calculation will be included in the lump sum payment. Hospitals and their advocates are not thrilled with this at all.

A $9 Billion windfall may seem like a winning lottery ticket for 340B hospitals. It is not all positive news for hospitals. Here's the scoop. Remember our old friend, budget neutrality?? In FY 2018, HHS increased OPPS payments to hospitals for NON-DRUG items and services by 3.19% when the cuts to drug acquisition costs for 340B hospitals were enacted. In the proposed rule, HHS estimates that acute care hospitals received an estimated $7.8 billion in additional spending on the aforementioned non-drug items and services for Medicare beneficiaries.

For these (sort of) bonus payments, HHS is proposing a 0.5% reduction in the OPPS fee schedule for non-drug items and services for all hospitals (340B and non-340B) for each year until the $9 Billion in lump sum payments to 340B hospitals is fully repaid. HHS estimates the 0.5% reduction will take place for the next 16 fiscal years from 2025 to 2040. Hospitals are freaking out about this 0.5% conversion factor reduction. Physicians' office say--hold our collective beers.

Remember that this is only a proposed rule and is not the final determination by HHS to resolve the 340B drug payment issue. HHS will hold the proposed rule open for comment until September 5th, 2023.

This newsletter is a brief interpretation of information. It may be subject to typos, misinterpretation, and misapplication. This company and its parent assume no liability for the content herein. Moreover, this is not consultative or legal advice. Billing of claims and payment thereof is individual to payers and circumstance. Providers should check with each payer prior to billing. This information is time-sensitive and may change at any time. Please ensure that you constantly check for new information.