Late last week, the Center for Medicare and Medicaid Services (“CMS”) issued its 2019 Medicare Physician Fee Schedule (“MPFS”) and Outpatient Prospective Payment System (“OPPS”) Final Rules. CMS is seeking to save money while embracing newer technologies in telehealth and reducing burdens on practitioners. The most significant impact is the reduction of reimbursement for “Evaluation and Management” outpatient services coupled with a site-neutral payment for the facility component in excepted (e.g., “grandfathered”) hospital off-campus provider-based departments.

Here are 10 things to know:

  1. Site neutral reimbursement for off-campus hospital outpatient clinic visits. Despite CMS’ attempt to create value by adding newly covered services, changing E/M policies, and slightly increasing OPPS and ASC payment rates, the OPPS Final Rule significantly reduced the reimbursement rate for clinic visits coded under G0463 (meaning, “a hospital outpatient clinic visit”).  This new site neutrality provision will apply to all excepted (e.g., “grandfathered”) off-campus sites.

These clinic visits will be paid at 70% of the OPPS rate in 2019, and 40% of the OPPS rate in 2020 and beyond. CMS states that this site neutral payment rate will mitigate the growth of “unnecessary” hospital outpatient services.  The American Hospital Association and the Association of American Medical Colleges are teaming up to challenge this rule.  Clinic visits are one of the most commonly billed outpatient services in off-campus provider-based departments.  This site-neutral policy will have a significant financial impact on hospitals.

Note: This rule will not impact (1) on-campus provider-based departments located within 250 yards of the main hospital, (2) off-campus provider-based departments located within 250 yards of a remote hospital location, or (3) any hospital dedicated emergency departments.

  1. Evaluation and Management (“E/M”) documentation guidelines will ease for practitioners, but changes are on hold until 2021. CMS finalized E/M documentation requirements designed to reduce the documentation burden for practitioners, but will delay implementation until CY 2021. The new documentation standards should enable practitioners to be more flexible and efficient. For CY 2019 and 2020, practitioners should continue to use either the 1995 or 1997 E/M documentation guidelines.

Beginning in 2021, the following documentation requirements will be removed:

  • Medical necessity documentation requirements for home visits (when replacing an office visit);
  • Requirement to re-record patient symptoms of a visit when unchanged from previous visits;
  • Requirement to enter medical record information on patient’s chief complaint and history that was already entered by ancillary staff; and
  • Duplicative notation requirements in medical records that were previously included by other members of the medical team.

Additionally, the Final Rule streamlines the payment reimbursement rates for E/M levels. Beginning in 2021, practitioners will be paid a single rate for E/M outpatient visits for levels 2 through 4.  Additionally, single payment rates will remain in place for levels 1 and 5 E/M visits. Reimbursement rates are indicated in the chart below:

 Level 2Level 3Level 4
Final Rule Rates$135$135$135


  1. Site neutral payment rate unchanged for non-excepted off-campus outpatient departments. Hospitals will continue to receive 40% of the OPPS rate for services rendered within non-excepted off-campus hospital outpatient departments (e.g., off-campus provider-based sites established or acquired on or after November 2, 2015 and not otherwise subject to an exception). Hospitals must continue to code these services with the “PN” modifier.


  1. “Clinical Families” proposal is scratched from final rule. Fortunately for hospitals, CMS did not adopt the Proposed Rule’s “clinical families” provision, meaning that hospitals will continue to have the flexibility to change and expand services within excepted (e.g., “grandfathered”) off-campus provider-based spaces.
  1. 340B reimbursement reduction extends to non-excepted off-campus locations. CMS finalized its policy to reduce reimbursement for 340B drugs dispensed by non-excepted off-campus provider-based departments. Beginning in CY 2019, the ASP – 22.5% 340B reduction will extend to non-excepted off-campus provider-based locations.

In better 340B news, however, HHS also issued a Proposed Rule to change the effective date of the 340B Ceiling Price/CMP Rule from July 1, 2019 to January 1, 2019. If the Proposed Rule is adopted, it would accelerate the policy’s effective date despite numerous delays by HHS to adopt a 340B price-ceiling rule over the past several years.  Implementation of the ceiling price rule would be a victory for safety net hospitals.

  1. Additional telemedicine codes will be added as reimbursable telehealth services. CMS implemented a number of new rules to promote the utilization of telehealth, demonstrating a willingness to embrace newer technologies.

Specifically, CMS will reimburse two new physician technology-based services including: 1) brief communication technology-based services e.g., virtual patient check-ins (HCPCS code G2012) and 2) remote evaluation of recorded video/images that are submitted by an established patient (HCPCS code G2010). CMS envisions that these services will increase physician efficiency in deciding whether or not an office visit or other services for a remote patient is necessary. Physicians will be paid separately for providing these telehealth services.

CMS also added reimbursable codes for telehealth services related to end-stage renal disease (ESRD) patients receiving home dialysis, and also included mobile stroke units as eligible telehealth originating sites. Additionally, Federally Qualified Health Center (“FQHC”) and Rural Health Center (“RHC”) practitioners that provide communication technology-based services and remote evaluation services will receive reimbursement even if those services are not associated with a billable patient visit. The newly created code for FQHC/RHC virtual communication services is G0071 and is reimbursable under PFS non-facility payment rates for communication and remote technology services.

CMS also relaxed the originating geographic site requirements for physicians treating opioid and substance use patients.  The MPFS Final Rule will now include an individual’s home as a permissible origination site for telehealth services furnished after or on July 1, 2019. In January 2020, CMS also plans to establish a new Medicare benefit category for opioid treatment programs under Medicare Part B. In the interim, there will be a 60-day period to comment about the proposed provision.

  1. Wholesale acquisition cost-based (“WAC”) payments for Part B Drugs. The MPFS Final Rule will reduce the add-on rate for new WAC Part B drugs by 3%.
  1. Added CPT billable codes. The OPPS Final Rule added 12 diagnostic cardiac catheterization services and 5 CPT reimbursable codes for ambulatory surgery center (“ASC”) covered procedures beginning in CY 2019. The 5 CPT codes include code numbers: 93566, 93567, 93568, 93571, and 93572.
  1. Facilities get a slight “pay raise.” The OPPS Final Rule adopts a 1.35% reimbursement raise for hospital facilities and a 2.1% raise for ASCs.
  1. Reduced burdens for quality measures reporting. CMS removed nine quality measures for hospital and ASC reporting, streamlining the quality reporting process for CY 2019.

For additional services please click here.  For any questions regarding the CY 2019 OPPS or MPFS Final Rules, or for any organizational assistance with any other health care regulatory or operational matters, please contact The Advis Group by calling (708) 478-7030 or fill out the contact form on the right side of this page.