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Summarizing Medicare’s 2024 Physician Fee Schedule Final Rule – Part 1

Last week, the Centers for Medicare and Medicaid Services (CMS) issued its final rule for the calendar year 2024 Physician Fee Schedule (MPFS). At over 2,700 pages, the final rule provides lengthy discussions of key policy changes to the MPFS. While CMS issued a helpful summary of the major changes in the fact sheet located at this link, the document does not explore key details about new policy in the rule. To better understand the changes, this edition of Insights InHealth summarizes a few of the key changes that will materially impact the operations of medical groups, with a focus on three areas: (1) the addition of key new current procedural terminology (CPT) codes, and (2) noteworthy changes to billing rules and policies. To facilitate your review of the rule in the federal register, we have provided page references in [brackets] throughout this document.


Before diving into the other changes, we highlight the new finalized conversion factor of $32.7442. The conversion factor represents a decrease of roughly 3.4% from the prior conversion factor of $33.8872. CMS anticipates that utilization of the new CPT codes will result in higher spending, which will partially offset the decrease, leading to an overall reduction in spending of 1.25% using the new conversion factor. Between specialties, primary care providers (e.g., family practice) are expected to see the most significant increase in reimbursement, mostly attributable to addition of the new office/outpatient evaluation/management visit complexity add-on CPT code (discussed further below). Procedure-driven specialties (e.g., interventional radiology) are expected to see the largest decreases in reimbursement. Overall, CMS is continuing its trend towards shifting reimbursement away from procedure-driven specialties to primary care specialties. This shift is being implemented in a “budget neutral” manner, though the wisdom of this approach in light of rampant inflation is beyond the scope of this article.


Addition of New CPT Codes: Focus on Primary Care and Addressing Social Needs

Office/Outpatient (O/O) Evaluation/Management (E/M) Add-On Code

The most significant addition to the CPT roster is the new add-on code for O/O E/M visits intended to capture the complexity of a primary care physician serving as the focal point for all health services or for other physicians managing an ongoing serious medical condition (HCPCS code G2211). This code was introduced in 2021, but implementation was delayed until this final rule. The new code can be billed in conjunction with O/O E/M visits (e.g., 99202-5 and 99211-5), but not inpatient E/M services.


The following quote summarizes CMS’s view of the applicability of the add-on code to existing E/M services: “We note that the application of the add-on code is not based on the characteristics of particular patients…but rather the relationship between the patient and the practitioner.” [Emphasis added] The code is not intended to be billed in conjunction with E/M services that are related to care involving a discrete, routine, or time-limited nature (“longitudinal, non-procedural care”). Essentially, the code will apply to primary care services and services involved in the ongoing management of a serious condition (e.g., cancers requiring chemotherapy).


The add-on code will be assigned .49 relative value units (RVUs), of which .33 are work RVUs (wRVUs), .14 are non-facility practice expense RVUs (peRVUs), and .02 are malpractice RVU (mpRVUs). The code cannot be billed in conjunction with modifier -25 (service billed on the same day as a minor procedure or another E/M visit by the same practitioner). CMS estimates that roughly half of all E/M services will be eligible for the new code, resulting in a 2% increase in total Part B spending. This impact drove a substantial proportion of the decrease in the conversion factor.

Services Addressing Health-Related Social Needs

As CMS has prioritized health equity as a key pillar of Medicare and Medicaid programs, the 2024 Final Rule contains new CPT codes intended to advance this objective. In order to better care for underserved populations, providers have a key role to play in addressing health-related social needs. Until the new final rule, this crucial work was not reimbursable by Medicare. The 2024 Final Rule adds seven key new CPT codes that pertain to these services. The table below summarizes the codes and their RVU amounts.

CPT Code

Description

wRVUs

peRVUs

mpRVUs

RVUs

G0019

Community Health Integration (CHI) services involving (but not limited to): holistic assessments of patient needs, care coordination between different provider types (e.g., care transition from hospital to home), and health education to enhance treatment.

1.00

1.35

0.07

2.42

G0022

CHI add-on code for each 30 minutes past initial 60 minutes.

0.70

0.76

0.05

1.51

G0023

Principal Illness Navigation (PIN) services involving (but not limited to): person-centered assessment of impact of illness to patient, identifying caregiver resources, care coordination, and health education to enhance specific illness treatment.

1.00

1.35

0.07

2.42

G0024

PIN add-on code for each 30 minutes past initial 60 minutes.

0.70

0.76

0.05

1.51

G0136

Administration of a standardized, evidence-based Social Determinants of Health (SDoH) Risk Assessment tool (5 to 15 minutes)

0.18

0.38

0.01

0.57

G0140

PIN services by peer support specialists for the treatment of behavioral health conditions.

1.00

1.35

0.07

2.42

G0146

PIN by peer support specialist add-on code for each 30 minutes past initial 60 minutes.

0.70

0.76

0.05

1.51

Here are some highlights related to the codes above:

  • The services covered by the new codes may be recurring in nature, with billing based on time spent delivering the services on a monthly basis.

  • The new services are applicable to certified or trained auxiliary personnel (e.g., care navigators) working under the direction of the physician (the last two codes are specific to peer support specialists only).

  • The following criteria establish the definition of a serious condition eligible for PIN services:

    • One serious, high-risk condition expected to last at least 3 months and that places the patient at significant risk of hospitalization, nursing home placement, acute exacerbation/decompensation, functional decline, or death.

    • The condition requires development, monitoring, or revision of a disease-specific care plan, and may require frequent adjustment in the medication or treatment regimen, or substantial assistance from a caregiver.

  • The SDoH risk assessment code cannot be billed separately if the time involved in administering the tool overlaps with CHI or PIN services.

Given the nature of these services, practices that have advanced capabilities in team-based care and data analytics related to value-based care stand to benefit from the additional reimbursement for activities essential to their care delivery models.

Caregiver Training Services

Given the critical role of caregivers in helping effectively treat underlying medical conditions, CMS finalized three new CPT codes for caregiver training provided by physicians or other qualified health professionals. The codes will reimburse for either individualized or group face-to-face training services provided to caregivers without the patient present. The caregiver training must be focused on facilitating a patient’s activities of daily living, reducing the impacts of a condition on a patient, and carrying out a treatment plan. The table below summarizes the codes and the RVU values.

CPT Code

Description

wRVUs

peRVUs

mpRVUs

RVUs

97550

Face-to-Face caregiver training to an individual without the patient present – first 30 minutes

1.00

0.56

0.03

1.59

97551

Add-on code for individual training – each additional 15 minutes

0.54

0.24

0.01

0.79

97552

Face-to-Face caregiver training to a group with multiple sets of caregivers and no patients present

0.23

0.43

0.01

0.67

The CPT code for group training (97552) is billed per person trained within the group.



Changes to E/M, Telemedicine, and Behavioral Health Services Policies

Split-Shared Billing Rules Update

As was the case in the 2023 Final Rule, CMS elected to postpone for another year their redefinition of what constitutes the “substantive portion” of a split/shared visit for the purpose of attributing credit to the visit to either the physician or advanced practice professional. For more background on split-shared billing rules, reference this prior Insight. This postponement will allow for split-shared visits to be attributed to the provider that performs the medical decision making associated with a visit, regardless of the distribution of face-to-face time associated with patient care. CMS is continuing to track utilization patterns associated with split-shared billing practices and may revisit its current position in future rulemaking.

Telemedicine Services Policies

A few notable changes were made regarding CMS’s telemedicine services policies. CMS added health and well-being coaching to the list of services eligible to be billed through telemedicine (CPT codes 0591T, 0592T, and 0593T). These services are provided by certified health and wellness coaches for the purpose of effecting the lifestyle changes needed to treat and manage conditions like diabetes, chronic pain, and depression without costly medical intervention. In addition, Medicare added the new CPT code, G0136, for SDoH assessment tool administration to the telemedicine services list. Of note, the CPT codes for CHI and PIN services do not typically require face-to-face interaction, so CMS indicated that those services could be billed similarly to other communications-based technology services (e.g., remote patient monitoring).


The 2024 Final Rule also codified significant changes to telemedicine policy that were originally proposed in the Consolidated Appropriations Act of 2023. These are summarized below:

  • Temporarily allowing telehealth originating sites (i.e., the locations where the patient receives a telehealth service) to include any location where the patient is located at the time of the service, include the home.

  • Expanding telemedicine-eligible practitioners to include qualified occupational therapists, physical therapists, speech-language pathologists, and audiologists.

  • Pausing the requirement for an in-person visit with a provider to establish telemedicine services for mental health conditions.

  • Continuing the temporary permission for providers to bill the services allowed during the COVID-19 public health emergency (e.g., select deep brain stimulation, therapy, hospital, and emergency department CPT codes).

  • Reimbursing telemedicine services originating from the patient’s home at the non-facility rate.

  • Extending the definition of “direct supervision” by a practitioner to permit immediate availability in the form of real-time audio and video interactive telecommunications technology.

The sum total of these changes will facilitate the financial viability of telemedicine providers that serve Medicare beneficiaries, at least through the end of 2024. In particular, the final two changes are essential for improving access to professional care through telemedicine given the costs associated with such services and the ability for physicians to simultaneously supervise care team staff spread over multiple geographic locations.

Behavioral Health Services Changes

Similar to the telemedicine policy changes and in keeping with the Biden administration’s focus on improving mental health, CMS finalized a number of important changes to Behavioral Health Services, as summarized below:

  • A variety of new provider types may bill Medicare Part B for mental health services, including:

    • Marriage and family therapists (MFTs)

    • Mental health counselors (MHCs)

    • Addiction counselors or drug and alcohol counselors who meet the applicable requirements to be an MHC

  • In addition, the CMS expanded the types of mental health services for which these providers can bill Medicare.

  • New CPT codes were established for crisis psychotherapy provided to patients located outside of a facility setting (e.g., in their home).

  • CMS is implementing a four-year transition process to increase the wRVUs associated with psychotherapy services. By then end of the four-year period, the wRVUs for these codes will have increased by around 19%.

As with the changes to telemedicine policy, these updates will increase access to care, as well as reimbursement for behavioral health services.


2024 PFS Final Rule Summary - Part 1
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