CMS issued several final rules last week, including the Outpatient Prospective Payment System (OPPS) and Ambulatory Surgical Center (ASC) Payment System Final Rule and the Physician Fee Schedule Final Rule. With the main headline surrounding the 340B program underpayments, CMS also addressed several administrative goals, including promoting health equity, expanding access to behavioral healthcare, improving transparency in the health system, and promoting safe, effective, and patient-centered care. CMS also announced modest payment increases for hospital outpatient and ASC services, while reducing the fee schedule conversion factor for physician services. Advis prepared a summary of key provisions below. Should you have any questions regarding these CMS policies, please contact Advis at 708-478-7030 or via our website.
OPPS and ASC Payment System Final Rule
- OPPS Payment for Drugs Acquired Through the 340B Program
CMS will continue to pay for 340B acquired drugs and biologicals at the statutory default rate, generally ASP plus 6%. The payment for 340B-acquired drugs and biologicals will not differ from the payment rate for drugs and biologicals not acquired through the 340B program. CMS recently issued a final rule discussing the remedy for payment for 340B acquired drugs for CYs 2018 to 2022, including how those payments will impact OPPS payment policy in future calendar years. An Advis summary of key provisions of the final rule on 340B-acquired drug payment policy can be found here.
- OPPS and ASC Payment Rates
CMS has finalized a 3.1% increase in payment rate for hospitals and ASCs based on the projected hospital market basket increase of 3.3%, reduced by 0.2% for the productivity adjustments. This is an increase of 0.3% from the proposed rule. An Advis analysis of key provisions in the proposed rule can be found here.
Additionally, CMS finalized its proposal to continue to align the ASC update factor with the one used to update hospital outpatient department (HOPD) payments – the productivity-adjusted hospital market basket update – extending the five-year interim period an additional two years, through CY 2025.
- Intensive Outpatient Program
In its Final Rule, CMS proposes policies to close a coverage gap for behavioral health by establishing payment for intensive outpatient program (IOP) services under Medicare.
An IOP is a distinct and organized outpatient program of psychiatric services provided for individuals who have an acute mental illness or substance use disorder, consisting of a specified group of behavioral health services paid on a per diem basis under the OPPS or other applicable payment system when furnished in HOPDs, Community Mental Health Centers (CMHCs), Federally Qualified Health Centers (FQHCs), and Rural Health Clinics (RHCs). IOP services may also be furnished in Opioid Treatment Programs (OTPs) for the treatment of opioid use disorder (OUD). CMS is in the process of finalizing a consolidated list of service codes to be included in the IOP.
To offer services under an IOP program, generally, a physician will need to certify, at least every other month, that the patient requires a minimum of nine hours of IOP services per week. CMS is establishing two IOP Ambulatory Payment Classifications (APCs) for each provider type: one for days with three services per day and one for days with four or more services per day. CMS is finalizing hospital-based and CMHC IOP payment rates for the two IOP APCs using a broad set of OPPS data. For the other care settings, RHCs will be paid the 3-services per day payment amount for HOPDs, and FQHC’s payment will be the lesser of a FQHC’s actual charges or the 3- services per day payment amount for hospital outpatient departments.
- Partial Hospitalization Program
The Final Rule includes updates to payment rates for partial hospitalization program (PHP) services furnished in HOPDs and CMHCs. CMS is expanding the existing rate structure to include two PHP APCs for each provider type: one for days with three services per day and one for days with four or more services per day. Hospital-based and CMHC PHP payment rates are calculated based on cost per day using OPPS data that includes both PHP and non-PHP days, which is a change from the current methodology of using only PHP data.
CMS also clarified that Medicare covers PHP for the treatment of Substance Use Disorder (SUD), and CMS considers services that are for the treatment of SUD and behavioral health generally to be consistent with the statutory and regulatory definitions of PHP services.
- Changes to Community Mental Health Centers Conditions of Participation (CoPs)
To implement provisions of the 2023 Consolidated Appropriations Act (CAA), as proposed, CMS is modifying the requirements for the CMHC to include IOP services throughout the CoPs. CMS will also modify the CMHC CoPs for personnel qualifications to add a definition of marriage and family therapists, and revise the current definition of mental health counselors. Lastly, CMS is adding Marriage and Family Therapists (MFTs) and Mental Health Counselors (MHCs) to the list of practitioners who can lead interdisciplinary team meetings.
- OPPS and ASC Payment for Dental Services
CMS will assign over 240 dental codes to clinical APCs to enable them to be paid for under the OPPS. This will result in greater consistency in Medicare payment for different sites of service and help ensure patient access to dental services performed in the hospital outpatient setting when payment and coverage requirements are met.
Additionally, based on public comments, CMS is reassigning HCPCS code G0330 from the Dental Procedures APC (APC 5871) to Level 4 ENT Procedures (APC 5164) for CY 2024 to more appropriately reflect the costs to furnish these services.
To address patient access to dental services, CMS is adding 26 separately payable dental surgical procedures to the ASC Covered Procedures List (CPL) and 78 ancillary dental services to the list of covered ancillary services.
- Hospital Price Transparency
In line with the goal to promote a more patient-driven health care system, CMS is finalizing modifications to the standard charge display requirements at 45 CFR 180.50. Additionally, CMS is finalizing updates to the enforcement provisions at 45 CFR 180.70 to streamline and improve the transparency of the enforcement process. These policy updates, among others, would include standardization of files and data elements for enhanced consumer access and readability, improved accessibility for oversight, and strengthened enforcement capabilities. Overall, these policy changes will serve to further increase price transparency and enforce hospital compliance with the new requirements.
- Rural Emergency Hospitals (REH) – Payment for Indian Health Services (HIS) Facilities and Tribal Facilities
To improve access to health in rural, Tribal, and geographically isolated areas, CMS is implementing a policy where IHS and Tribal facilities that convert to REHs will be paid for hospital outpatient services under the same All-Inclusive Rate (AIR) that would otherwise apply if these services were performed by an IHS or Tribal hospital that is not an REH. Additionally, IHS and Tribal facilities that convert to REHs would receive the REH monthly facility payment consistent with how this payment is applied to REHs that are not tribally or IHS operated.
- Hospital Outpatient/ASC/REH Quality Reporting Programs
CMS is modifying three measures in both the Hospital Outpatient Quality Reporting (OQR) and Ambulatory Surgical Center Quality Reporting (ASCQR) programs. These modified measures include the COVID-19 Vaccination Coverage Among Healthcare Personnel (HCP) measure, the Cataracts: Improvement in Patient’s Visual Function Within 90 Days Following Cataract Surgery measure, and the Appropriate Follow-Up Interval for Normal Colonoscopy in Average Risk Patients measure.
In addition, CMS is adopting a new measure in both programs – the Risk-Standardized Patient-Reported Outcomes Following Elective Primary Total Hip and/or Total Knee Arthroplasty measure and an additional measure that applies only to the Hospital OQR Program – the Excessive Radiation Dose or Inadequate Image Quality for Diagnostic Computed Tomography (CT) in Adults electronic clinical quality measure (eCQM).
Lastly, the Final Rule adopts and codifies the Rural Emergency Hospital Quality Reporting (REHQR) Program, a new quality reporting program for specifically designated REHs that must provide emergency department (ED) services and observation care.
Other notable changes:
OPPS Payment for Remote Mental Health Services: CMS is finalizing technical changes in how remote mental health services are furnished, including creating a new untimed code describing group psychotherapy.
Addition of Procedures to the ASC Covered Procedures List (ASC-CPL): CMS finalized the addition of 37 surgical procedures to the ASC-CPL, including the 26 dental codes that were included in the proposed rule and 11 additional surgical codes that were not included in the proposed rule.
Hospital Inpatient Prospective Payment System (IPPS) and OPPS Payment Adjustments for the Additional Costs of Establishing and Maintaining a Buffer Stock of Essential Medicines: While CMS is not adopting a policy in the Final Rule, they intend to propose new CoPs in forthcoming notice and comment rulemaking addressing hospital processes for pharmaceutical supply.
It is important to note that CMS expects to release further guidance on the following topics mentioned in the OPPS and ASC Final Rule summary:
- Hospital transparency regulations;
- Untimed code describing group psychotherapy; and
- CoPs addressing hospital processes for pharmaceutical supply
Medicare Physician Fee Schedule Final Rule
- Ratesetting and Conversion Factor
Overall payment rates under the PFS will be reduced by 1.25% in CY 2024 compared to CY 2023.
The final CY 2024 PFS conversion factor is $32.74, a decrease of $1.15 (or 3.4%) from the current CY 2023 conversion factor of $33.89.
- Services Addressing Health-Related Social Needs
For CY 2024, CMS is finalizing coding and payment changes to better account for resources involved in furnishing patient-centered care involving a multidisciplinary team of clinical staff and other auxiliary personnel.
Specifically, CMS will pay separately for Community Health Integration (CHI), Social Determinants of Health (SDOH) Risk Assessment, and Principal Illness Navigation (PIN) services. The services described by the finalized codes are the first that are specifically designed to describe services involving community health workers, care navigators, and peer support specialists.
CHI services address unmet SDOH needs that affect the diagnosis and treatment of the patient’s medical problems. PNI services are to help people with Medicare who are diagnosed with high-risk conditions (for example, dementia, HIV/AIDS, and cancer) identify and connect with appropriate clinical and support resources.
CMS has also finalized an additional set of PIN codes to describe services involving auxiliary personnel, such as peer support specialists, along with coding and payment for SDOH risk assessments to recognize when practitioners spend time and resources assessing SDOH that may be impacting their ability to treat the patient.
- Evaluation and Management (E/M) Visits
Beginning January 1, 2024, CMS is implementing a separate add-on payment for healthcare common procedure coding system (HCPCS) code G2211. Generally, it will be applicable for outpatient and office visits as an additional payment. This additional payment follows the reasoning that building an effective longitudinal relationship, in and of itself, is a key aspect of providing reasonable and necessary medical care. Further, CMS has clarified that the add-on code cannot be billed with an office or outpatient E/M visit that is itself focused on a procedure or other service instead of being focused on longitudinal care for all needed healthcare services, or a single, serious or complex condition.
For split (or shared) E/M visits provided in part by physicians and in part by other nonphysician practitioners, CMS is revising to the definition of “substantive portion” of a split (or shared) visit to mean more than half of the total time spent by the physician or nonphysician practitioner performing the split (or shared) visit, or a substantive part of the medical decision making.
- Telehealth Services
CMS will add health and well-being coaching services to the Medicare Telehealth Services List on a temporary basis for CY 2024, and SDOH Risk Assessments on a permanent basis. Further, beginning in CY 2024, telehealth services furnished to people in their homes will be paid at the non-facility PFS rate.
CMS is implementing several telehealth-related provisions of the Consolidated Appropriations Act, 2023 (CAA, 2023), such as the temporary expansion of the scope of telehealth originating sites for services furnished via telehealth, the expansion of the definition of telehealth practitioners, and other provisions until December 31, 2024.
Collectively, these policies will continue many of the flexibilities put in place during the COVID-19 PHE for Medicare telehealth services at least until the end of 2024.
Importantly, for telehealth services furnished in teaching settings located outside the metropolitan statistical area (MSA), CMS finalized an exception in which case the teaching physician could be present through audio/video real-time communications technology, rather than by physical presence.
Teaching physicians will continue to be allowed to use audio/video real-time communications technology to be present when the resident furnishes Medicare telehealth services in all residency training locations through the end of CY 2024.
Additionally, CMS is finalized the proposal to allow the entirety of Diabetes Self-Management Training (DSMT) services to be furnished via telehealth.
- Behavioral Health Services
CMS continues to implement policies put forth in the CAA, 2023 including Medicare Part B coverage and payment under the Medicare Physician Fee Schedule for the services of MFTs and MHCs when billed by these professionals. Additionally, addiction counselors or drug and alcohol counselors who meet the applicable requirements will be able to enroll in Medicare as an MHC. Enrolled MFTs and MHCs will be able to bill for services starting January 1, 2024.
Further, new HCPCS codes (90839 and 90840) will be established under the PFS for psychotherapy for crisis services that are furnished in an applicable site of service on or after January 1, 2024. Other policies aimed at expanding access to behavioral health services include the ability of social workers, MFTs, and MHCs to now bill Health Behavior Assessment and Intervention (HBAI) services and an increase in the valuation for timed behavioral health services under the PFS.
Other changes in the Final Rule include modifying the requirements for the hospice Conditions of Participation (CoPs) to allow social workers, MHCs or MFTs to serve as members of the interdisciplinary group (IDG), finalizing the requirements for the RHC and FQHC Conditions for Certification and Conditions for Coverage (CfCs) to allow MFTs and MHCs to provide additional behavioral health services in these facilities, and removing the requirement that nurse practitioners be certified in primary care to provide care in these facilities.
- Rural Health Clinics (RHCs) and Federally Qualified Health Centers (FQHCs)
In line with the CAA, 2023, CMS will extend payment for telehealth services furnished in RHCs and FQHCs and extend the definition of direct supervision to permit virtual presence in RHCs and FQHCs through December 31, 2024.
CMS has finalized several new codes and payment methods for services furnished by RHCs and FQHCs, including:
- Remote Physiologic Monitoring and Remote Therapeutic Monitoring in the general care management HCPCS code G0511;
- CHI and PIN services in the general care management HCPCS code G0511; and
- a change in the methodology to calculate the payment rate for the general care management HCPCS code G0511.
- Medicare and Medicaid Provider and Supplier Enrollment
CMS has finalized several regulatory provisions regarding Medicare and Medicaid provider enrollment. These include, but are not limited to:
- A new Medicare provider enrollment action labeled a “stay of enrollment;”
- Requiring all Medicare provider and supplier types to report additions, deletions, or changes in their practice locations within 30 days;
- Establishing new and revised Medicare denial and revocation authorities; and
- Clarifying the length of time for which a Medicaid provider will remain in the Medicaid termination database.
Other notable changes:
Caregiver Training Services: CMS finalized new coding and payment for caregiver training services, so that practitioners are appropriately paid for engaging with caregivers to facilitate the patient’s functional performance in the home or community.
Medicare Part B Payment for Preventive Vaccine Administration Services: CMS will maintain the additional payment for in-home COVID-19 vaccine administration and will 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. Effective January 1, 2024, the payment amount for the in-home administration of all four vaccines will be identical.
Clinical Laboratory Fee Schedule: CMS is specifying that for the data reporting period of January 1, 2024, through March 31, 2024, the data collection period for clinical diagnostic laboratory tests (CDLTs) that are not advanced diagnostic laboratory tests (ADLTs) is January 1, 2019 through June 30, 2019. Additionally, for CY 2023, payment for a CDLT that is not an ADLT may not be reduced compared to the payment amount established for that test in CY 2022 and for CYs 2024 through 2026, payment may not be reduced by more than 15% as compared to the payment amount established for that test for the preceding year.