July 21, 2021

It’s that time of year again. Last week, the government released the 2022 Medicare Physician Fee Schedule (PFS) Proposed Rule (PR), and there are some interesting changes that may be in store for hospitals. The following treatment is based on what we’ve gleaned from summaries of the PR released by the Centers for Medicare and Medicaid Services (CMS) and the American Hospital Association (AHA).

Conversion Factor

By way of background the Consolidated Appropriations Act of 2021 (CAA) provided a 3.75 percent increase in the PFS conversion factor (CF) for 2021 only. This one-year increase was meant to offset the rather substantial 10.20 percent PFS CF decrease that CMS finalized for that year. Because the CAA instructed CMS to ignore the 3.75 percent increase when determining PFS payment rates for subsequent years, the agency calculated the 2022 CF as though the 3.75 percent increase never occurred. Thus, CMS proposes a slight decrease in PFS payment rates of 0.14 percent in 2022.

The true change, however, from the final 2021 CF of $34.89 to the proposed 2022 CF of $33.58 is a decrease of $1.31 or 3.89 percent. This reflects the expiration of the 3.75 percent payment increase, a 0 percent update factor as required by the Medicare Access and CHIP Reauthorization Act (MACRA) of 2015, and a budget-neutrality adjustment.

Appropriate Use Criteria

The government proposes to delay the payment penalty phase of the Appropriate Use Criteria (AUC) program to the later of Jan. 1, 2023, or the Jan. 1 that follows the end of the public health emergency (PHE). The agency seeks comment on the proposed start date for the payment penalty phase of the program and whether it sufficiently accounts for the COVID event.

Telehealth Services

This rule includes several proposals to extend temporary coverage of some telehealth services and make permanent coverage and payment for other services. In the 2021 PFS final rule, CMS created a new category—Category 3—for adding services to the approved list of Medicare telehealth services on a temporary basis. The agency also added within that previous rule several services to the Medicare list of telehealth services on a Category 3 basis, establishing coverage and payment for those services through the end of the year in which the PHE expires. In the 2022 PR, the agency retains all services added to the Medicare telehealth services list on a Category 3 basis until the end of CY 2023.

The PR also addresses telehealth as they relate to mental health services. Specifically, providers would be required to conduct an in-person, non-telehealth service within six months prior to providing an initial telehealth mental health service, and at least once every six months thereafter. This requirement would apply only to the mental health telehealth services delivered to patients in their homes and services delivered to patients in geographic locations beyond those currently authorized for Medicare telehealth services.

The PR also allows the use of audio-only communication for the diagnosis, evaluation, or treatment of mental health disorders that are furnished to established patients in their homes, but only if the beneficiary is unable to use, does not wish to use, or does not have access to two-way, audio/video technology.

Shared Visits

The 2022 PR recommends certain refinements in the evaluation and management (E/M) rules. Included within these are provisions related to split (or shared) visits in the facility setting. This is where a physician may see a patient in the morning, for example, and a non-physician practitioner (NPP) within the same group practice sees the same patient later in the day. Together, these visits can currently be billed out as one combined encounter under either provider’s NPI. The PR recommends the following changes for these types of visits:

Definition of split (or shared) E/M visits as evaluation and management (E/M) visits provided in the facility setting by a physician and an NPP in the same group.

The practitioner who provides the substantive portion of the visit (more than half of the total time spent) would bill for the visit.

Split (or shared) visits could be reported for new as well as established patients, and for initial and subsequent visits, as well as prolonged services.

Requiring reporting of a modifier on the claim to help ensure program integrity.

Documentation in the medical record that would identify the two individuals who performed the visit. The individual providing the substantive portion must sign and date the medical record.
Critical Care Services

Proposed changes within the 2022 PR related to critical care services include the following:

Use American Medical Association (AMA) CPT prefatory language as the definition of critical care visits, including bundled services.

Allow critical care services to be furnished concurrently to the same patient on the same day by more than one practitioner representing more than one specialty, and that critical care services can be furnished as split (or shared) visits.

No other E/M visit can be billed for the same patient on the same date as a critical care service when the services are furnished by the same practitioner, or by practitioners in the same specialty and same group to account for overlapping resource costs.

Critical care visits cannot be reported during the same time period as a procedure with a global surgical period.
Rural Health Clinics and Federally Qualified Health Centers

The PR allows RHCs and FQHCs to deliver mental health services via telehealth after the COVID PHE flexibilities expire. Under this proposal, RHCs and FQHCs would be allowed to report and receive payment for mental health visits furnished via real-time telecommunication technology in the same way they currently do for in-person visits. This would include audio-only visits when the beneficiary is not capable of, or does not consent to, the use of video technology.

Medicare Provider Enrollment

CMS proposes several revisions to the provider enrollment regulations, including:

Expanding the agency’s authority to deny or revoke a provider’s or supplier’s Medicare enrollment;

Establishing certain rebuttal procedures for providers and suppliers whose Medicare billing privileges have been deactivated; and

Exempting certain types of independent diagnostic testing facilities (IDTF) from several IDTF supplier standards.
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Due to the amount of material covered in the 1747-page PR, we will be providing further details in a future alert. For now, if you have questions about this topic, you can contact us at info@miramedgs.com.