United States: CMS Finalizes CY 2024 Medicare Physician Fee Schedule Rule

On November 2, 2023, the Centers for Medicare & Medicaid Services ("CMS") released the calendar year ("CY") 2024 Physician Fee Schedule (PFS) Final Rule ("CY 2024 PFS Final Rule"). The final rule reflects CMS' broader strategy to promote a more equitable health care system.

Key Takeaways

• In the CY 2024 PFS Final Rule, CMS decreased payment rates by 1.25% while increasing rates for primary care.
• CMS finalized changes for services that address health-related social needs to allow patients to better access patient navigation services. In addition, CMS finalized proposals related to telehealth by adding additional services to the Social Determinants of Health Risk Assessments and related to payment changes for opioid treatment programs, diabetes screening, and vaccination administration services.
• The provisions of the CY 2024 PFS Final Rule are effective starting January 1, 2024. Below we provide an overview on a few of the key provisions included in the CY 2024 PFS Final Rule related to payment rates, SDOH, value-based care, and telehealth.

The CY 2024 PFS Final Rule includes the following provisions:

Updates to PFS payment rates: CMS reduced PFS payment rates by 1.25% in CY 2024 compared to CY 2023. The final CY 2024 PFS conversion factor is $32.74, a decrease of $1.15 (or 3.4%) from the current CY 2023 conversion factor of $33.89. On the other hand, CMS is finalizing increases in payment rates for primary care and other types of direct patient care.

Updates for Services Addressing Health-Related Social Needs: To align with the HHS Social Determinants of Health Action Plan and help implement the Biden-Harris Cancer Moonshot goal of helping patients with cancer have access to better patient navigation services, CMS finalized coding and payment changes for resources involved in furnishing patient-centered care involving a multidisciplinary team of clinical staff and other auxiliary personnel.

One of those changes was finalizing separate payment codes for Community Health Integration, Social Determinants of Health (SDOH) Risk Assessment, and Principal Illness Navigation services to account for resources involving various types of health care support staff such as community health workers, care navigators, and peer support specialists. The Principal Navigation codes are used to describe services involving auxiliary personnel, such as peer support specialists to better support individuals with behavioral health conditions like severe mental illness and substance use disorder. The SDOH risk assessment codes will be used to recognize when practitioners spend time and resources assessing SDOH that may be impacting their ability to treat the patient. In addition to the risk assessment codes, CMS also added the SDOH risk assessment to the annual wellness visit as an optional element with an additional payment and no patient coinsurance nor deductible (when provided with the annual wellness visit). Lastly, CMS finalized codes and payments for SDOH risk assessments given out during an evaluation or behavioral health visit.

Telehealth Services under the PFS: In the CY 2024 PFS final rule, CMS finalized their proposal to add health and well-being coaching services to the Medicare Telehealth Services List on a temporary basis for CY 2024, and Social Determinants of Health Risk Assessments on a permanent basis.

CMS also finalized the implementation of several telehealth-related provisions of the Consolidated Appropriations Act, 2023 (CAA, 2023):

• The expansion of the (1) scope of telehealth originating sites for services furnished via telehealth to include any site in the United States where the beneficiary is located at the time of the telehealth service, including an individual's home; and (2) definition of telehealth practitioners to include qualified occupational therapists, qualified physical therapists, qualified speech-language pathologists, and qualified audiologists.
• The continued payment and coverage of (1) telehealth services furnished by Rural Health Clinics (RHCs) and Federally Qualified Health Centers (FQHCs) using the methodology established for those telehealth services during the COVID-19 PHE; and (2) telehealth services included on the Medicare Telehealth Services List (as of March 15, 2020) until December 31, 2024.
• Delaying the requirement for an in-person visit with the physician or practitioner within six months prior to initiating mental health telehealth services, and again at subsequent intervals as the Secretary determines appropriate, as well as similar requirements for RHCs and FQHC.
• Telehealth services furnished to people in their homes will be paid at the non-facility PFS rate to protect access to mental health and other telehealth services by aligning with telehealth-related flexibilities that were extended.
• Define direct supervision to permit the presence and immediate availability of the supervising practitioner through real-time audio and video interactive telecommunications through December 31, 2024.

Updates to Remote Therapeutic Monitoring (RTM) services: CMS finalized their proposal to include Remote Physiologic Monitoring (RPM) and Remote Therapeutic Monitoring (RTM) in the general care management HCPCS code G0511 when these services are provided by RHCs and FQHCs. Additionally, CMS finalized a regulatory change to allow therapy assistants to be supervised by physical and occupational therapists in private practice for RTM services. This change aligns with the RTM general supervision policy that CMS finalized in their CY 2023 rulemaking. In the final rule, CMS clarified that the 16-day data requirement does not specifically apply to RTM CPT codes 98980 and 98981.

Medicare Part B Payment for Preventive Vaccine Administration Services: CMS finalized three proposals for vaccination payment continuity. CMS finalized the proposal to maintain the additional payment for the administration of a COVID-19 vaccine in the home, and to extend this in-home additional payment to the other three preventive vaccines: the pneumococcal, influenza, and hepatitis B vaccines – when provided in the home. Relatedly, CMS also finalized the proposal to limit the additional payment to one payment per home visit, even if multiple vaccines are administered during the same home visit. Lastly, effective January 1, 2024, Medicare will pay the same payment amount for the in-home administration of all four vaccines.

Behavioral Health Services: In the PFS final rule, CMS implements Section 4123 of the CAA, 2023, which requires the Secretary to establish new HCPCS codes for psychotherapy for crisis services that are furnished in an applicable site of service. This section specifies that the payment amount for psychotherapy for crisis services shall be equal to 150% of the fee schedule amount for non-facility sites of service for each year for the services identified.

CMS is now allowing the Health Behavior Assessment and Intervention (HBAI) service codes (CPT codes 96156, 96158, 96159, 96164, 96165, 96167, and 96168, and any successor codes) to be also billed by clinical social workers, marriage and family therapists (MFTs), and mental health counselors (MHCs) in addition to clinical psychologists.

CMS also finalized the proposal to apply an adjustment to the work relative value units (RVUs) for psychotherapy codes payable under the PFS which will be implemented over a four-year transition.

Opioid Treatment Programs (OTPs): The CY 2024 final rule will now allow OTPs to bill Medicare under the Part B OTP benefit for furnishing periodic assessments via audio-only telecommunications when video is not available to the beneficiary. CMS is also finalizing their proposal to extend current flexibilities for periodic assessments given over via audio-only telecommunications through the end of CY 2024.

Expanded Diabetes Screening and Medicare Diabetes Prevention Program (MDPP) Expanded Model: The PFS final rule aims to remove barriers, reduce provider and patient burden and confusion, and allow for greater person-centered care in expanding diabetes screen frequency limitations. CMS finalized their proposal to expand coverage of diabetes screening to include the Hemoglobin A1c (HbA1c) test and to simplify the regulatory definition of "diabetes" for diabetes screening, Medical Nutrition Therapy (MNT) and Diabetes Outpatient Self-Management Training Services (DSMT).

For the MDPP Expanded Model, CMS finalized changes to (1) extend the model's Public Health Emergency Flexibilities for four years, which will allow all MDPP suppliers to continue to offer MDPP services virtually through December 31, 2027; and (2) simplify MDPP's current performance-based payment structure by allowing fee-for-service payments for beneficiary attendance.

Provisions from the Inflation Reduction Act Relating to Drugs and Biologicals Payable Under Medicare Part B: The PFS final rule addressed the following changes related to drugs and biologicals:

• Section 11101 requires that beneficiary coinsurance for a Part B rebatable drug is to be based on the inflation-adjusted payment amount if the Medicare payment amount for a calendar quarter exceeds the inflation-adjusted payment amount, beginning on April 1, 2023. CMS issued initial guidance implementing this provision and are finalizing conforming changes to regulatory text.

• Section 11407 provides that for insulin furnished through an item of durable medical equipment (DME) on or after July 1, 2023, the deductible is waived and coinsurance is limited to $35 for a month's supply of insulin furnished through a covered item of DME. CMS is finalizing the codification of this provision for 2024 and future years.

• Section 11402 amends the payment limit for new biosimilars furnished on or after July 1, 2024, during the initial period when the average sales price (ASP) data is not available. CMS is finalizing the codification of this provision in subsequent regulation.

• Section 11403 makes changes to the payment limit for certain biosimilars with an ASP that is not more than the ASP of the reference biological for a period of five years. CMS is finalizing conforming changes to regulatory text to reflect these provisions.

Conclusion

The CY 2024 PFS Final Rule can be viewed on the Federal Register here. CMS also released a fact sheet on the final rule.

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