CMS introduces proposals to CY 2025 Medicare Physician Fee Schedule

On July 10, 2024, the Centers for Medicare and Medicaid Services (CMS) issued a proposed rule for the 2025 Calendar Year (CY 2025) Medicare Physician Fee Schedule (MPFS) (the Proposed Rule). The Proposed Rule includes updates and changes to CMS payment policy for 2025 in several key areas for physicians and other clinicians, including among others, reducing average payment rates under the MPFS, updating certain telehealth policies, creating a new category of care management services, and providing additional guidance on overpayments. 

This year, however, it is notable that the Proposed Rule follows directly on the heels of two recent Supreme Court decisions, Loper Bright Enterprises v. Raimondo, et al (Loper Bright) and Corner Post, Inc. v. Board of Governors (Corner Post), that may reshape the regulatory landscape of administrative law and agency rulemaking. Although we do not address those decisions or their implications in detail here, please see our previous client alert on Loper Bright for more detail.  

CMS is seeking comments to the CY 2025 MPFS by September 9, 2024.  

Reduction to average payment rates

For 2025, CMS is proposing to reduce average payment rates under the MPFS by 2.93 percent compared to the average amount reimbursed for these services in CY 2024. CMS explains that this amounts to a proposed estimated CY 2025 MPFS conversion factor decrease of $0.93 (or 2.8 percent) from the current CY 2024 conversion factor.  

Telehealth updates

In the Proposed Rule, CMS seeks to update payment policies for Medicare telehealth services. We have highlighted several of these proposals below.

In the CY 2024 Physician Fee Schedule Final Rule, CMS changed the process for making additions, deletions, and changes to the Medicare Telehealth Services List, replacing the old categorization with a new 5-step process (beginning in CY 2025). As part of this change, each telehealth service is assigned either a “permanent” or “provisional” status. A telehealth service receives “provisional” status if there is not enough evidence to demonstrate the clinical benefit of the service, but enough evidence that further study may demonstrate such benefit. 

Denial and addition of certain telehealth services

For CY 2025, CMS would deny several requests it received to permanently add various services to the Medicare Telehealth Services List for CY 2025, including a request to add continuous glucose monitoring (CGM) services. In declining to add CGM services, CMS explains that CGM does not qualify as Medicare telehealth services because there is no inherent face-to-face encounter, nor does the patient need to be present for CGM to be furnished in its entirety. CMS declined to add other services to the Medicare Telehealth Services List for CY 2025 including cardiovascular and pulmonary rehabilitation, health and well-being coaching, and therapy, audiology, and speech language pathology services. Notably, CMS did add Pre-exposure Prophylaxis (PrEP) of Human Immunodeficiency Virus (HIV) services to the list, which would enable primary care and specialized telehealth providers to offer PrEP services via telehealth to Medicare beneficiaries. 

Permitting audio-only communication technology to meet the definition of “telecommunication system”

In response to the public health emergency (PHE), CMS allowed the use of audio-only communications technology to furnish audio-only telephone evaluation and management services, behavioral health counseling, and educational services. CMS is now proposing to revise the definition of “interactive telecommunications system” to include two-way, real-time audio-only communication technology for any telehealth service furnished to a beneficiary in their home if the distant site physician or practitioner is technically capable of using an interactive telecommunications system (multimedia communications equipment that includes audio and video equipment permitting two-way, real-time interactive communication), but the patient is not capable of, or does not consent to, the use of video technology. In this proposal, CMS recognizes that broadband access varies for patients, and that not all patients want to engage with a practitioner in their home using interactive audio and video.   

Distant site requirements

CMS proposes to permit distant site practitioners to continue reporting their currently enrolled practice location, instead of their home address, when providing telehealth services from their home through CY 2025.  

Supervision 

Under Medicare Part B, certain types of services must be furnished under supervision by a physician/practitioner (ie, general supervision, direct supervision, or personal supervision). As relevant herein, direct supervision requires the supervising physician/practitioner to be present in the office suite and immediately available to furnish assistance and direction throughout the performance of the service. 

During the PHE, CMS amended the definition of “direct supervision” to permit a supervising physician/practitioner to be considered “immediately available” through virtual presence using two-way, real-time audio/visual technology for certain services. CMS originally extended this definition through December 31, 2024, and in the Proposed Rule, this definition would be extended through December 31, 2025. Although CMS notes that it remains concerned about situations in which complications arise and the true availability for a supervising physician/practitioner to intervene, CMS recognizes the importance of maintaining this flexibility, which increases patient access to care.  

CMS also proposes to permanently adopt a definition of direct supervision that allows “immediate availability” of the supervising physician/practitioner using audio/video real-time communications technology for a subset of incident-to services, which it views as lower risk given that these services are typically performed in their entirety by auxiliary personnel. These services include (1) services furnished incident-to a physician or other practitioner’s service when provided by auxiliary personnel employed by the billing practitioner and working under direct supervision, and for which the underlying HCPCS code has been assigned a professional component and technical component indicator of “5;” and (2) services described by CPT code 99211. For all other services required to be furnished under direct supervision, CMS proposes to continue to define “immediate availability” to include real-time audio and visual interactive telecommunications technology only through December 31, 2025.

Enhanced care management 

CMS proposes to adopt new HCPCS codes (GPCM1 through 3) for newly defined advanced primary care management (APCM) services whereby a practitioner will be prospectively paid on a per beneficiary per month basis. The new codes would be stratified into three levels based on certain patient characteristics that are broadly indicative of patient complexity and the consequent intensity of resources needed to provide advanced primary care services. These include Level 1 (patients with one or fewer chronic conditions), Level 2 (patients with two or more chronic conditions), and Level 3 (“Qualified Medicare Beneficiaries” with two or more chronic conditions).   

Billing practitioners and auxiliary personnel must have the ability to furnish every service element of APCM (which are included in the code descriptions) as appropriate for any individual patient during any calendar month. However, CMS acknowledges that not all elements may be necessary for every patient during each month (eg, if a patient is not hospitalized during the month, then there will be no management of a care transition after hospital discharge). Therefore, as proposed, not all elements in the code descriptions for APCM services must be furnished during each given calendar month. Conversely, CMS anticipates that there may be some months where it may be appropriate for some service elements to be performed more than once per patient.  

While CMS proposes that specific minutes spent furnishing APCM services for purposes of billing, the APCM codes do not need to be documented in the patient’s medical record. CMS expects to see actions/communications that fall within the APCM elements of service described in the medical record and, as appropriate, their relationship to the clinical problem and/or treatment plan they are intended to resolve.

CMS also proposes a new stand-alone HCPCS code, GCDRA, for the administration of a standardized, evidence-based Atherosclerotic Cardiovascular Disease (ASCVD) Risk Assessment for patients with ASCVD risk factors on the same date as an evaluation/management visit. ASCVD Risk Assessment is currently proposed for 5 to 15 minutes to administer, and billed no more often than once every 12 months.  

CMS sees advanced primary care as a core mechanism for achieving accountable care relationships for all traditional Medicare beneficiaries and vast majority of Medicaid beneficiaries by 2030. In an ongoing effort to strengthen the primary care infrastructure within traditional Medicare, CMS is seeking feedback regarding potential further evolution in coding and payment policies and exploring opportunities to support advanced primary care.  

Reporting and refunding of overpayments

In December 2022, CMS proposed changes to existing Medicare regulations for Parts A, B, C, and D Overpayment Provisions (the “December 2022 Overpayment Proposed Rule”), which we discussed in a previous client alert. CMS did not finalize its proposals in the December 2022 Overpayment Proposed Rule, but rather, retained its proposals and made additional proposals in the Proposed Rule to revise the deadline for reporting and returning overpayments. 

CMS now proposes to clarify the circumstances under which the deadline for reporting and returning overpayments will be suspended, to allow providers time to investigate and calculate overpayment amounts. Specifically, CMS proposes that the 60-day timeframe would be suspended if: (1) a person identified an overpayment, but has not yet completed a good-faith investigation to determine the existence of related overpayments, with such suspension lasting the earlier of: (i) the completion of the good-faith investigation and calculation of related overpayments or (ii) 180 days after the date on which the initial identified overpayment was identified, and (2) a person has made a submission to the Office of the Inspector General (OIG) Self-Disclosure Protocol, the CMS Voluntary Self-Referral Disclosure Protocol, or after requests for an extended repayment schedule as defined under regulation. After the suspension, CMS proposes that the requirement to report and return the overpayment will now be the earlier of, (i) 60 days after the conclusion of the good-faith investigation and calculation of the overpayment amount or (ii) 180 days from the initial discovery of the overpayment. 

CMS provides an example that helps illustrate how these timeframes toll. If a provider identifies an overpayment on day one but has reason to suspect that there may be more affected claims, that provider will now have up to 180 days to conduct and conclude a good-faith investigation to determine the extent of related overpayments. This timeframe may be suspended further subject to voluntary submissions made to OIG or CMS, as set forth above. However, CMS states that if the provider decides not to conduct an investigation, then the overpayment must be reported and returned within 60 days from its initial discovery. 

Additional noteworthy proposals

Office/Outpatient E/M visit complexity add-on  

CMS proposes to refine the current policy beginning CY 2025 with respect to the office/outpatient evaluation and management (O/O E/M) visit complexity add-on code by allowing payment when the O/O E/M base code is reported by the same practitioner on the same day as an annual wellness visit (AWV), vaccine administration, or any Medicare Part B preventive service furnished in the office or outpatient setting.

Supervision of outpatient therapy services in private practices and certification of therapy plans of care with a physician or non-physician practitioner (NPP) order  

• CMS proposes to allow for general supervision of occupational therapy assistants (OTAs) and physical therapy assistants (PTAs) by occupational therapists in private practice and physical therapists in private practice, when the OTAs and PTAs are furnishing outpatient occupational and physical therapy services, respectively.
• CMS proposes to amend its requirements for orders/referrals so that a signed and dated order/referral from a physician/NPP combined with certain other documentation may be sufficient to demonstrate the physician or NPP’s certification of required conditions.

Advancing access to behavior health services 

To address certain risks in individuals with substance use disorders, CMS proposes to:

• Establish separate coding and payment describing safety planning interventions.
• Add a monthly billing code to describe specific protocols involved in furnishing post-discharge follow-up performed in conjunction with a discharge from the emergency department for a crisis encounter.
  
• Provide Medicare payment to billing practitioners for certain digital mental health treatment furnished incident to or integral to professional behavioral health services.

Medicare parts A and B payment for dental services inextricably linked to specific covered services

Consistent with recent efforts to explore dental services that may be inextricably linked and substantially related and integral to the clinical success of other covered services, CMS:

• Proposes to codify at 42 CFR § 411.15(i)(3)(i)(A) additional policies to permit payment for certain dental services that are inextricably linked to other dialysis services in the treatment of end-stage renal disease (ESRD).
• Requests public comment and information related to other clinical scenarios that may involve dental services that are inextricably linked to other covered services relating to diabetes and autoimmune diseases.
• Requests public comment on the services related to use of oral appliances to treat sleep apnea.

Modifications related to Medicare coverage for opioid use disorder treatment services furnished by opioid treatment programs

CMS proposes modifications to the policies governing Medicare coverage and payment of opioid use disorder treatment services furnished by opioid treatment programs, including telecommunication flexibilities to allow periodic assessments to be furnished by audio-only telecommunications. Additionally, CMS proposes to update the payment rate for certain substance use disorder intake activities. 

Other policy proposals

CMS also made significant proposals concerning the following:

• Medicare Shared Savings Program
• Merit-based Incentive Payment System
• Medicare Prescription Drug Inflation Rebate Program

We will continue to review these and other initiatives impacting physicians and other healthcare providers. For more information about the Proposed Rule, please contact your DLA Piper relationship attorney, the authors of this alert, or any member of our Healthcare industry group.