CY 2023 CMS Final Rule: Medicare Physician Fee Schedule

Earlier this week, CMS released the CY 2023 Medicare Physician Fee Schedule (CY23 MPFS) Final Rule

Please see a summary of the key items, below:

Conversion Factor and MEI CY 2023 Updates

CMS finalized the CY23 PFS conversion factor, which is a fixed amount used to convert relative value units for a service into PFS payments amounts. The CY23 conversion factor is $33.06, which is a $1.55 decrease from CY 2022. This conversion factor reflects the 0% update required for CY 2023, expiration of the 3% supplemental increase in PFS in CY 2022 provided by the Protecting Medicare and American Farmers From Sequester Cuts Act, and the budget neutrality adjustment requirement to account for changes in payment rates.

CMS also finalized the CY23 MEI, which is an index that measures changes in the market price of inputs used to furnish physician services. CMS set the CY23 conversion factor at 3.8% based on the most recent historical data available. The 2017-rebased and revised MEI weights were not used in this rate setting, despite CMS soliciting comments regarding the use of these for rate setting in the future.

Telehealth Services

CMS finalized the policies that were made temporarily available until at least 151 days following the end of the PHE, as aligned with the Consolidated Appropriations Act of 2022. These policies include the following:

  • Expanding originating sites to include any site in which the patient is located at the time of receiving telehealth services, including their homes
  • Expanding providers eligible to furnish telehealth services to include FQHCs and RHCs
  • Expanding practitioners eligible to furnish telehealth services to include the following:
    • Physical therapists,
    • Occupational therapists,
    • Speech-language pathologists, and
    • audiologists
  • Delaying in-person requirements for mental health services furnished through telehealth, and
  • Providing select services may be provided through audio-only telecommunications technology.

CY23 MPFS provided the following updates to billing for telehealth through the later of the end of CY 2023 or the end of the year in which the PHE ends:

  • CMS updated the telehealth originating site facility fee (final payment amount for HCPCS code Q3014) to $28.64.
  • Physicians and practitioners should continue billing with the place of service (POS) code that would have been reported has the service been furnished in-person.
  • Providers billing for Medicare telehealth services using POS “02” will receive facility payment rates during the PHE. Providers may also use POS “10” for Medicare telehealth and services provided in patients’ homes.
  • Modifier “95” should be appended to Medicare telehealth service claims during the PHE.

CMS confirmed their intention to provide guidance on implementing these telehealth services and billing to ensure a smooth transition after the end of the PHE. Advis will continue to closely monitor CMS instruction and guidance following the PHE.

Behavioral Health and Substance Abuse Treatments

Behavioral Health Services and Exception to Incident to Billing

CMS created an exception to “incident to” supervision requirements and created a new General behavioral health integration (BHI) code. Behavioral health services may now be provided under the general supervision of a physician or non-physician practitioner when these services are furnished by auxiliary personnel incident to services of a physician. CMS clarified that this exception applies to services provided primarily for the diagnosis and treatment of a mental health or substance abuse disorders. CMS noted that they intend to address payment for new codes describing caregiver behavioral management training in the CY2024 rulemaking.

Opioid Treatment Programs (OTP)

In addition to the behavioral health billing changes discussed above, Medicare will now pay OTPs for opioid use disorder treatments provided through mobile medication units in accordance with Drug Enforcement Administration (DEA) and Substance Abuse and Mental Health Services Administration (SAMHSA) guidance. A medication unit is a component of an OTP that is geographically separated from the OTP and used to provide OTP services. Mobile units are helpful for people living in rural areas with limited accessibility, especially given that the CY23 MPFS authorizes CMS to pay for treatments provided through them.

E/M Visit Coding

Other E/M visits

The CY23 MPFS maintains current billing policies applying to Other E/Ms, including hospital inpatient, hospital observation, emergency department, nursing facility, home or residence services, and cognitive impairment assessment. CMS finalized creation of Medicare-specific coding for payment of Other E/M prolonged services. Providers are to report E/M prolonged services with three separate Medicare-specific G codes:

G0316: Prolonged inpatient or observation services by physician or other qualified health professional,

G0317: Prolonged nursing facility services by physician or other qualified health professional,

G0318: Prolonged home or residence services by physician or other qualified health professional.

Other Impactful Updates

Clinical Laboratory Fee Schedule

CMS finalized changes to 42 CFR part 414, subpart G, (PAMA) specifying that the data reporting period of January 1, 2023 through March 31, 2023, the data collection period is January 1, 2019 through June 30, 2019. CMS is requiring data reporting is required every 3 years beginning in January 2023. CMS also revised payment so that in 2023-2025, payment may not be reduced by more than 15% as compared to the amount established for the preceding year.

Audiology and Oral Health Services

CMS finalized a new modifier, AB, that will allow beneficiaries direct access to an audiologist without an order from a physician or NPP for non-acute hearing conditions. CMS finalized Medicare FFS payment policies for dental services when that service is an integral part of specific treatment of a beneficiary’s primary medical condition and other clinical scenarios under which Medicare Part A and Part B payment can be made for dental services.

Requiring Manufacturers of Certain Single-Dose Container or Single-Use Package Drugs to Provide Refunds with Respect to Discarded Amounts

CMS is finalizing requirements for providers in all outpatient settings to report the JW modifier for discarded amounts of drugs beginning January 1, 2023 and the JZ modifier for attesting there were no discarded amounts starting no later than July 1, 2023.

For any questions regarding the CY23 MPFS, the impact on providers, or any other health care regulatory and/or operational matters, please contact Advis or call 708.478.7030.

Published: November 4, 2022