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The AOA public policy team provides an overview of proposed updates to physician payment policies, the Quality Payment Program (QPP) and the Medicare Shared Savings Program.
On July 10, 2024, the Centers for Medicare & Medicaid Services (CMS) issued the CY2025 Medicare Physician Fee Schedule proposed rule which includes updates to physician payment policies, the Quality Payment Program (QPP) and the Medicare Shared Savings Program. Key takeaways include the following:
Outlined below is an initial summary of this year’s proposed rule. The AOA will submit comments to CMS on its proposals ahead of the Sept. 9 deadline.
Conversion factor
Fee-for-service payments under the Medicare program are determined by multiplying the relative value units (RVUs) for work, practice expense and malpractice for a given service by the fee schedule conversion factor. These values are then adjusted based on geographic practice cost indices (GPCIs). CMS proposes a conversion factor of $32.3562, which reflects a nearly 2.8% reduction in payment across the fee schedule, from CY2024. The anesthesia conversion factor is similarly reduced and will be $20.3340.
Statute requires that any changes to the fee schedule are applied in a budget neutral manner. This means that any changes to RVUs may not result in a net increase to Medicare expenditures when accounting for anticipated utilization. CMS estimates that total changes in expenditures, as a result of newly payable services and changes to existing RVUs, will result in a 0.05% upward budget neutrality adjustment to the conversion factor.
The reduction in payment is driven by the expiration of the short-term increase to the conversion factor enacted by Congress to mitigate past cuts.
The AOA will work with Congress to prevent payment cuts to the 2025 conversion factor and continue its efforts to ensure long-term physician payment reform that entails annual inflationary updates to account for rising costs of practicing medicine.
Evaluation and Management (E/M) coding changes
CMS is proposing to allow the G2211 office/outpatient (O/O) E/M care complexity add-on code, which was made newly payable in 2024, to be billed on the same date as preventive services.
CMS would allow G2211 to be paid when billed with an annual wellness visit (AWV), vaccine administration or any Medicare Part B preventive service furnished in the office or outpatient setting. As a result, E/M codes appended with a modifier -25, to bill preventive services, may also be billed with G2211. This change is intended to better align with how primary care is delivered and support appropriate payment for physician work when they provide an E/M and a preventive service on the same date, while also accounting for the complexity involved in maintaining a longitudinal relationship with a patient.
Advanced Primary Care Management (APCM) Services
CMS proposes to create three new Healthcare Common Procedure Coding System (HCPCS) codes for APCM. In recognition of the importance of driving team-based, coordinated primary care, CMS developed codes designed to capture the broad range of services that comprise advanced primary care. Elements of this service would include enhanced communication with patients via synchronous and asynchronous services, closer collaboration across providers, remote consultations with specialists and real-time management of patients with acute or complex conditions.
The codes are split across three levels to reflect patient characteristics that are indicative of complexity and resource use:
The elements of these services entail several of the elements of other care management services, and as a result, CMS proposes that APCM may not be billed with chronic care management, principal care management, transitional care management or certain communication technology-based services. Patient consent would be required, as these services would entail cost sharing and practices would need to meet certain advanced primary care requirements to bill these codes.
Telehealth
Congressional action is necessary to extend the telehealth flexibilities, set to expire at the end of 2024, which have enabled broader access to telehealth services. Absent legislative action, restrictions that existed prior to the COVID-19 public health emergency, including site and geographic restrictions, will once again go into effect. However, CMS is using the authority it has to support continued access to telehealth where appropriate. CMS will continue to pay for telehealth services at parity with in-person services, proposes adding several services to the telehealth service list, and intends to continue to pay for audio-only services furnished to a beneficiary in their home if the physician is technically capable of using an interactive audio-video telecommunications system but the patient is not capable of, or does not consent to, the use of video technology.
CMS will continue to permit physicians to bill from their enrolled practice location instead of their home address when they are providing telehealth services from their home.
CMS proposes to continue to define direct supervision to permit the “virtual presence” and immediate availability of the supervising practitioner through real-time audio and video interactive telecommunications through Dec. 31, 2025. CMS is also proposing to permanently adopt a definition of direct supervision that allows “immediate availability” of the supervising practitioner using real-time audio-visual communications technology only for a limited subset of incident-to services that CMS views as low-risk to quality or patient safety.
As it applies to services billed in teaching settings, CMS is proposing to continue to permit virtual presence to meet the requirement that a teaching physician be present for the key portion of a service when the service is delivered via telehealth. This change would apply in all teaching settings through the end of CY2025. CMS has also included, in the proposed rule, a request for information on the range of services included under the primary care exception.
Provisions related to Global Surgery Payment
In the proposed rule, CMS reiterates previously stated concerns that estimates of service utilization used to value global periods for surgical procedures are inaccurate and cites data that most postoperative visits included in global periods do not take place. To improve data collection and better understand utilization, CMS proposes to require the use of the existing modifiers (-54, -55 and -56) for all 90-day global surgical packages in any case when the physician (or other practitioner from the same group practice) expects to furnish only the pre-operative (-56), procedure (-54) or post operative portions of a global package (including but not limited to when there is a formal, documented transfer of care).
CMS also proposes a new add-on code for post-operative care services by practitioners not involved in furnishing a surgical procedure to more appropriately reflect the additional time and resources involved in these post-operative visits.
Cardiovascular risk assessment and risk management
CMS seeks to build on its Million Hearts® model, where results of the demonstration found that the model reduced the rate of death, from any cause, for beneficiaries at medium and high-risk for cardiovascular disease by 4%, as well as reduced the risk of death from a cardiovascular event (i.e., heart attack or stroke) by 11%. CMS proposes to create two new HCPCS codes:
Payment for behavioral health services
CMS proposes several payment changes to support its behavioral health strategy:
CMS is also proposing several changes related to OTP, including new telehealth flexibilities for opioid use disorder treatment in OTP facilities, and enhancing payment for OTP intake activities to include payment for social determinants of health risk assessments. The latter proposal seeks to ensure that payment adequately reflects additional effort OTPs may undertake to identify a patient’s unmet health-related social needs or the need for harm reduction interventions and recovery support services.
Payment for preventive services
CMS proposes to cover hepatitis B vaccine and its administration as a Part B preventive service. CMS also proposes to create a fee schedule for drugs covered as preventive services, which would initially include PrEP for HIV. Coverage of these services as preventive under the Part B benefit will support expanded access by making them available without beneficiary cost-sharing.
Federally Qualified Health Centers and Rural Health Clinics
CMS proposes to make several updates to payment policies for Federally Qualified Health Centers (FQHCs) and Rural Health Clinics (RHCs). Most notably, CMS highlights a broader effort to align FQHC and RHC billing and payment with payment under the broader fee schedule. As part of this effort, CMS proposes for 2025 to require FQHCs and RHCs to report the individual CPT and HCPCS codes that describe care coordination services instead of the single HCPCS code G0511 for care management.
CMS also proposes to allow payment, through Dec. 31, 2025, for non-behavioral health visits furnished via telecommunication technology, and to continue to delay the in-person visit requirement for mental health services furnished via communication technology by RHCs and FQHCs to beneficiaries in their homes until Jan. 1, 2026.
CMS also makes several payment adjustments for FQHCs and RHCs, including updates to productivity standards that impact RHC all-inclusive rates, as well as updates to the FQHC market basket for payment.
Clinical Laboratory Fee Schedule
Consistent with statutory requirements, CMS will resume the phase in of Protecting Access to Medicare Act (PAMA) payment reductions to clinical laboratory fee schedule services following the expiration of a delay enacted by Congress that expires at the end of 2024. AOA was successful in obtaining a delay in 2024 and will continue to advocate to prevent these cuts from taking effect in the future.
Merit-Based Incentive Payment System (MIPS) updates
Physicians who participate in MIPS receive a positive, neutral or negative adjustment to their total payment based on their overall performance across four categories: cost, quality, promoting interoperability, and improvement activities. Adjustments are made based on scores relative to a performance threshold.
CMS is proposing to maintain the performance threshold used to determine payment adjustments at 75 points. This follows advocacy by the AOA expressing concern to CMS that many practices sought exemptions from MIPS requirements for the duration of the COVID-19 public health emergency, potentially distorting data on performance. AOA expressed concern that this would particularly disadvantage small and independent practices that disproportionately sought exemptions. This also follows concerns expressed regarding further disruption resulting from the Change Healthcare cyberattack.
The agency proposes numerous changes to the MIPS measure inventory across performance categories, proposes to revise the methodology for scoring topped out quality measures in specialty sets with limited measures and proposes changes to cost measure scoring methodologies.
MIPS Value Pathways (MVPs)
CMS is interested in continuing to refine the MIPS program to better promote value. The MVP performance pathway streamlines activities and measures in each of the performance categories to focus on those that are relevant to a particular specialty, condition or episodes of care. MVPs are designed to allow clinicians to report on a smaller, more relevant set of measures. This pathway may also help alleviate burden associated with reporting under traditional MIPS by allowing physicians to report a reduced number of measures or activities. However, CMS has designed MVPs in a manner that is exceedingly broad and may not truly address the issues that exist in traditional MIPS, such as the need to improve clinical relevance of measures for many specialties and sub-specialties.
In the CY2025 proposed rule, CMS seeks to establish six new MVPs related to ophthalmology, dermatology, gastroenterology, pulmonology, urology and surgical care. CMS is also proposing to consolidate two neurology-specific MVPs into a single MVP.
The agency proposes a change to scoring under MVPs whereby rather than participants selecting a population health measure to report on during MVP registration, CMS will instead use participants’ highest score across available measures. CMS is also proposing changes to better align MVP scoring of cost and improvement activity categories with traditional MIPS.
Currently, participation in MVPs is optional. However, CMS has stated that its goal is to fully shift participation into MVPs or Alternative Payment Models (APMs) and ultimately sunset traditional MIPS. In the proposed rule, the agency sets the goal of completing this transition by 2029. However, MVPs require substantial changes to support broader participation, and the AOA will work with CMS to ensure that traditional MIPS does not sunset until necessary changes are made.
APM Performance Pathway (APP)
CMS proposes to create within the APM Performance Pathway (APP) the APP Plus quality measure set beginning with the CY 2025 performance period/2027 MIPS payment year to align with the Universal Foundation measures under the CMS National Quality Strategy. This would add five measures from the universal foundation to the APP (in addition to the 6 measures already included in the APP). The APP Plus measure set would be required for Medicare Shared Savings Program Accountable Care Organization (ACO) participants, and optional for other APP participants.
Advanced APMs
Beginning in performance year 2025/payment year 2027, the incentive payment for participating in an advanced APM (AAPM) will no longer be available. However, beginning in 2026, the physician fee schedule will have separate conversion factors for AAPM participants and non-AAPM participants, whereby participants receive a 0.75% update to the conversion factor each year and non-participants receive a 0.25% update each year.
Health equity benchmark adjustment
CMS proposes to adjust an ACO’s historical benchmark based on the proportion of the ACO’s assigned beneficiaries who are enrolled in the Medicare Part D low-income subsidy (LIS) or dually eligible for Medicare and Medicaid. CMS’ stated goal is to incentivize practices serving higher proportions of beneficiaries from underserved communities to enter and remain in the program.
APP Plus Quality measure set, scoring methodology and incentives for electronic Clinical Quality Measure (eCQM) reporting
As previously noted, CMS proposes to add five new measures to the APP measure set to align with the universal foundation of measures. MSSP ACOs will be required to report these measures, but CMS will phase in these requirements through performance year 2028. To encourage ACOs to more quickly transition to eCQMs, CMS proposes to extend the Shared Savings Program’s eCQM reporting incentive to performance year 2025 and subsequent performance years to continue to support ACOs reporting eCQMs in meeting the Shared Savings Program quality performance standard for sharing in the savings at the maximum sharing rate.
Mitigating the impact of Significant, Anomalous and Highly Suspect (SAHS) billing activity on Shared Savings Program financial calculations
CMS proposes to build on efforts in another recently proposed rule to address SAHS billing activity. The agency will exclude payment amounts from expenditure and revenue calculations for the relevant calendar year for which the SAHS billing activity is identified as suspect, as well as from historical benchmarks used to reconcile the ACO payment for a performance year corresponding to the calendar year.
The AOA will continue its detailed review of the CY2025 Medicare Physician Fee Schedule and will share resources with members as they are developed. In the meantime, if you have any questions, please contact John-Michael Villarama, MA, Vice President of Public Policy, at [email protected].