Medicare Proposes Changes to Clinician Pay for E/M Visits

July 31, 2019

Osborn Insurance Group

The Centers for Medicare and Medicaid Services (CMS) said today that it is seeking to change its approach to paying clinicians for many office visits, incorporating recommendations and ideas from research done by the American Medical Association.

Medicare also is pressing for greater disclosure to consumers about hospital prices and for the creation of incentives for dialysis centers to adopt newer technologies. CMS announced these plans as it unveiled three draft payment rules for 2020.

These include the proposed physician fee schedule for 2020, which CMS Administrator Seema Verma described on a call with reporters as a bid to modernize the approach used to pay for evaluation and management (E/M) services.

CMS said the proposed E/M changes for the 2020 physician fee schedule are intended to better pay “clinicians across all specialties for the time they spend treating the growing number of patients with greater needs and multiple medical conditions.”

By increasing the value of E/M codes for office/outpatient visits and providing enhanced payments for certain types of visits, CMS “is investing in the critical thinking required to evaluate a patient, which will help improve outcomes,” the agency said.

About 1 in 5 people enrolled in Medicare have multiple chronic diseases, Verma said in a press release.

“We are announcing proposals so that the government doesn’t stand in the way of patient care, by giving clinicians the support they need to spend valuable time coordinating the care of these patients to ensure their diseases are well-managed and their quality of life is preserved,” she said.

Proposed Coding Changes Align With AMA Guidance

In a fact sheet on the proposed rule, CMS said it intends to align its E/M coding with changes laid out by the American Medical Association (AMA)’s CPT Editorial Panel for office/outpatient E/M visits. The CPT coding changes maintain five levels of coding for established patients and cut the number of levels to four for office/outpatient E/M visits for new patients, CMS said.

The changes for CPT also change the medical decision-making process for the codes, while requiring performance of history and exam only as medically appropriate, CMS said. The agency said the CPT code changes also allow clinicians to choose the E/M visit level based on either medical decision-making or time involved.

CMS also said it intends to incorporate work done by the AMA’s Relative Value Scale Update Committee (RUC).  The AMA RUC-recommended values would increase payment for office/outpatient E/M visits.

CMS said this recommendation is based on a “robust” survey approach by the AMA. The AMA’s work “surveying over 50 specialty types demonstrate that office/outpatient E/M visits are generally more complex and require additional resources for most clinicians,” CMS said.

“We are proposing to adopt the AMA RUC-recommended values for the office/outpatient E/M visit codes for CY 2021 and the new add-on CPT code for prolonged service time,” CMS said.

The physician fee rule also covers nurse practitioners, physician assistants (PAs), and physical therapists, as well as radiation therapy centers and independent diagnostic testing facilities, CMS said.

In the fact sheet, CMS also said it is seeking through the rule to modify the regulation of PAs. The agency intends to give PAs “greater flexibility to practice more broadly in the current health care system in accordance with state law and state scope of practice.”

Price Transparency

In a separate proposed rule covering Medicare’s 2020 payment for outpatient services provided at hospitals, CMS put forward what the agency called “historic changes” regarding cost disclosures. In a press release, CMS said hospitals will need to make public their “standard charges,” which the agency defines as two types of charges: gross charges and payer-specific negotiated charges. CMS also said hospitals will need to post information on standard charges online in a machine-readable file.

And CMS also released a draft rule covering Medicare’s 2020 payments for care of people enrolled in the program who have end-stage renal disease (ESRD). This proposal would alter the approach to deciding which products qualify for the transitional drug add-on payment adjustment (TDAPA) under the ESRD payment rule. The aim is to better target the additional payments to “innovative renal dialysis drugs and biological products,” with CMS proposing to exclude generic drugs from TDAPA eligibility.