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  • Washington Highlights

    CMS Issues 2021 Final Physician Fee Schedule and Quality Payment Program Rule


    Gayle Lee, Director, Physician Payment & Quality

    The Centers for Medicare and Medicaid Services (CMS) released the Calendar Year 2021 Medicare Physician Fee Schedule and Quality Payment Program final rule on Dec. 1, 2020. 

    The rule would make permanent certain telehealth and workforce flexibilities provided during the public health emergency, establish payment rates for physicians and other health care professionals for 2021, and make significant changes to the Quality Payment Program. 

    CMS responded to comments submitted by the AAMC and others to the proposed rule. Below are highlights of provisions in the rule.

    Physician Fee Schedule

    The Physician Fee Schedule includes evaluation and management (E/M) coding, documentation, and payment changes that were finalized in the 2020 Medicare Physician Fee Schedule final rule, which would increase payment for outpatient/office E/M services in 2021. 

    To offset the increase in payment for E/M and other services, the statute requires payment reductions in other services. Therefore, CMS announced it will reduce the conversion factor from $36.09 to $32.41, a decrease of approximately 10.2%. Redistributions in payment will be significant, with family medicine increasing by 13% and many other specialties that do not perform office visits frequently experiencing decreases of 8% or more. 

    The AAMC and other stakeholders will be advocating in the coming weeks for Congress to act to stop these reductions. 

    The rule also includes policy changes that expand coverage and payment for some telehealth services on a permanent basis after the pandemic ends and others on a temporary basis until the end of the calendar year in which the pandemic ends. These changes include the permanent addition of some services to the telehealth list, such as the newly established visit and complexity code and prolonged services code. The services that would be added to the telehealth list temporarily until the end of the calendar year in which the public health emergency (PHE) ends include emergency department visits, observation services, critical care, therapy services, and others. When the PHE ends, separate payment will not be made for audio-only telephone E/M services. However, CMS creates a new virtual check-in code for longer conversations of 11-20 minutes to assess whether an in-person visit is warranted. 

    CMS noted that a more permanent expansion of telehealth coverage, which would include removal of the rural and originating site restrictions, would need to be authorized by Congress.

    The rule also finalizes a permanent policy to permit teaching physicians to bill for their services involving residents through virtual presence only for services furnished in residency training sites in rural areas that are located outside of a metropolitan statistical area (MSA). When a teaching physician, through virtual presence, furnishes services involving these residents, the patient’s medical record must clearly reflect how and when the teaching physician was present for the service. For all other settings, the teaching physician virtual presence policies will remain in place for the duration of the PHE. 

    In addition, the rule establishes a policy that Medicare will make payments to the teaching physician when the resident furnishes an expanded array of services (which include CPT codes 99421-99423 and 99452, as well as codes G2010 and G2012) under the primary care exception. Also, residents in training sites outside of an MSA will be able to furnish Medicare telehealth services.

    The rule amends policies regarding moonlighting to state that residents’ services that are not related to their approved graduate medical education programs and are performed in the outpatient department, emergency department, or inpatient setting of a hospital in which they have their training program are separately billable physician’s services for which payment may be made. 

    The rule finalizes changes to the Medicare Shared Savings Program for performance year 2021 to align with Meaningful Measures, reduce reporting burden, and focus on patient outcomes. For performance year 2020, CMS will provide automatic full credit for Consumer Assessment of Healthcare Providers and Systems patient experience of care surveys.

    Quality Payment Program

    In the Quality Payment Program section of the rule, CMS finalizes significant changes to reporting and participation options for providers in the program.

    The rule establishes changes to Merit-based Incentive Payment System (MIPS) performance thresholds and category weights at the following levels for the 2021 performance year (2023 payment year):

    • Performance threshold: 60 points. 
    • Quality performance category weighted at 40% (decrease from 45% in performance year 2020).
    • Cost performance category weighted at 20% (increase from 15% in performance year 2020).
    • Promoting Interoperability performance category weighted at 25% (no change from performance year 2020).
    • Improvement Activities performance category weighted at 15% (no change from performance year 2020).

    In light of the COVID-19 public health emergency, CMS will postpone the introduction of any MIPS Value Pathways (MVPs) until the 2022 performance year. CMS will allow the use of the CMS Web Interface as a collection and submission type for reporting MIPS quality measures in 2021 and will sunset the Web Interface beginning in 2022. 

    CMS will sunset the Alternative Payment Model (APM) Scoring Standard and allow MIPS-eligible clinicians in APMs the option to participate in MIPS and submit data at the individual, group, virtual group, or APM Entity level. For performance year 2021, the CMS will implement a new Alternative Payment Model Performance Pathway to align with the new MVP framework. This option would only be available to MIPS APM participants and would be reported by the individual eligible clinician, group at the taxpayer identification number level, or APM entity. 

    For additional information, CMS has published a physician fee schedule final rule fact sheet and a quality payment program final rule fact sheet and FAQ.

    The AAMC is reviewing the provisions in the final rule and will be providing more details in an upcoming webinar.