Medicare Physician Fee Schedule Final Rule 2020 – What practices need to know

The Centers for Medicare & Medicaid Services (CMS) published its 2020 Medicare Physician Fee Schedule Final Rule on November 15, 2019.  CMS estimates that total allowed charges under the Medicare Physician Fee Schedule for all specialties will exceed $93 billion in 2020, which includes approximately $2.2 billion for nephrology, $1.9 billion for hematology/oncology, $1.8 billion for radiation oncology and radiation therapy centers, and $500 million for rheumatology.   

Here are some of the key provisions that will impact physician practices in 2020: 

Since 2015, Medicare has reimbursed physicians for chronic care management (CCM) furnished to beneficiaries with multiple chronic conditions. CCM involves non-face-to-face services furnished by clinical staff under general supervision of the billing practitioner, pursuant to a written care plan. These services include, for example, care coordination, medication reconciliation, and patient education.  Generally, CCM is intended for the long-term management of high-cost patients by primary care providers.

Effective January 1, CMS will reimburse for principal care management (PCM) furnished to beneficiaries with a single chronic condition. The following identifies the key differences between CCM and PCM services:

	Chronic Care Management	Principal Care Management
Base CPT/HCPCS code	99490	G2065
Total RVU/Payment	1.17/$42.22	1.10/$39.70
Time Requirement (services furnished by clinical staff under general supervision)	20 minutes/month	30 minutes/month
Number of Chronic Conditions	2 or more	1
Billing Practitioner (most cases)	Primary Care Provider	Specialist
Scope of Service	Manage total patient care	Manage disease-specific care
Likely Trigger	General need for care coordination, communication	Exacerbation of condition or hospitalization
Intended Length of Time	Longer-term, as needed	Shorter-term, until condition is stabilized

Note: these summarizations are not strict service requirements, rather, a brief summarization of intended use of the codes based on various readings of CMS regulatory guidance and other materials.

Concerned about paying for duplicative services, CMS includes two additional requirements for PCM:  (1) the practitioner billing for PCM must document in the patient’s record ongoing communication and care coordination between all practitioners furnishing care to the beneficiary, and (2) the practitioner cannot bill for interprofessional consultations or other care management services (excluding remote patient monitoring for the same beneficiary for the same time period as PCM).

As with CCM, CMS will reimburse for PCM services furnished directly by a physician or non-physician practitioner (as opposed to clinical staff under general supervision) under HCPCS code G2064. Payment will be $78.68 for 30 minutes or more of care management services.  

PCM becomes a strong alternative to CCM for specialists engaged in care management activities. CCM has always been challenging for specialists as they often only manage one (or a subset) of a patient’s chronic conditions. With PCM, that focus becomes the purpose—shorter-term care management of a single chronic condition—and specialists will likely find it easier to meet the code’s billing requirements.

After proposing otherwise, CMS has decided to assign the same weights to the four MIPS performance categories as it did in 2019:

• Quality – 45 percent
• Improvement Activities – 15 percent
• Promoting Interoperability – 25 percent
• Cost – 15 percent

By statute, Cost must be increased to 30 percent and Quality must be reduced to 30 percent by 2022.

In 2020, the minimum performance score required to avoid any MIPS penalty will increase from 30 to 45 points. In 2021, it will increase to 60 points. The threshold to qualify for the exceptional performance payment will increase from 75 to 85 points in 2020 and 2021. Finally, the maximum incentive payment and penalty will increase to 9 percent in 2020.  

In 2020, there will be 20 measures in the Cost category:   the Medicare Spending Per Beneficiary measure, the Total Per Capita Cost measure, and eighteen episode-based measures. CMS is adding 10 new episode based measures, including a new measure for lumpectomy, partial mastectomy and simple mastectomy.

In the Final Rule, CMS discussed at length its intent to expand the number of episode-based measures in future years to include more specialties, including the process for developing and validating those measures.

CMS will calculate a Cost score based on a combination of all the Cost measures for which a physician or group qualifies. However, CMS will not calculate a score in the Cost category if the physician or group does not meet the case minimum for at least one of the measures. In those cases, the 15 percent Cost category weight will be transferred to the Quality category, raising the percentage from 45 percent to 60 percent.

This summer, CMS proposed an updated framework for MIPS called MIPS Value Pathways, or MVPs. The proposed MVPs are best described as condition- or specialty-specific groups of cost, quality, and improvement measures. Measures would be pre-selected and grouped for providers, to relieve the burden of choice and re-focus the program on the most important health priorities (i.e., quality over quantity).

In the Final Rule, CMS affirmed its intent to move forward with MVPs, with at least some MVPs defined and available for reporting in 2021. However, CMS offered no additional details, other than to state its intent to engage stakeholders in the MVP development process. 

The allowable charge for each service listed on the Medicare Physician Fee Schedule is calculated by multiplying the relative value units (RVUs) assigned to that service by a standard Medicare conversion factor. In 2020, physicians will see a 0.14 percent increase in that conversion factor, from $36.04 in 2019 to $36.09. The calculation of the annual conversion factor is mandated under the Medicare Access and CHIP Reauthorization Act (MACRA) of 2015. 

As is the case each year, a significant portion of the Final Rule addresses work, practice expense, and malpractice RVU adjustments for a wide range of services. The 2020 RVU updates will result in minor changes in total allowed charges for some specialties, as illustrated below: 

Highest Increases		Highest Reductions
Clinical Social Worker	4%	Ophthalmology	-4%
Clinical Psychologist	3%	Diagnostic Testing Facility	-3%
Podiatry	2%	Neurology	-2%
		Optometry	-2%
		Cardiac Surgery	-2%
		Vascular Surgery	-2%

Source: CY2020 Medicare Physician Fee Schedule Final Rule, Table 119.

All other specialties will experience no more than a 1 percent gain or loss in total allowed charges due to RVU changes. Keep in mind that CMS’ estimates are based on the entire specialty, and the impact of the proposed RVU changes can vary widely depending on the mix of services provided in a practice.

CMS remains on track to overhaul documentation and payment policies for evaluation and management (E/M) services. Effective January 1, 2021, CMS will adopt revised E/M code definitions developed by the AMA CPT Editorial Panel. CMS also intends to pay for each level of service rather than utilize a blended rate and to adopt revised work and practice RVU inputs for E/M services.

CMS included in the Final Rule its estimated impact of the E/M changes on specific specialties’ total allowed charges in 2021, which range from a 16 percent increase for endocrinologists to a 10 percent decrease for ophthalmologists.

Highest Increases		Highest Reductions
Endocrinology	16%	Ophthalmology	-10%
Rheumatology	15%	Chiropractor	-9%
Hematology/Oncology	12%	Nurse Anesthetist	-9%
Family Practice	12%	Cardiac Surgery	-8%
Urology	8%	Pathology	-8%
Neurology	8%	Radiology	-8%
Interventional Pain Management	8%	Physical/Occupational Therapy	-8%
General Practice	8%	Radiation Oncology & Radiation Therapy Centers	-4%
Nurse Practitioner	8%

Source: CY2020 Medicare Physician Fee Schedule Final Rule, Table 120.