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Medicare Physician Fee Schedule Rule

E/M Reimbursement in 2019: What You Need to Know

On Thursday, November 1, 2018 the Centers for Medicare & Medicaid Services (CMS) released the 2019 Medicare Physician Fee Schedule final rule, announcing modifications to their proposed changes to the office and outpatient evaluation and management (E/M) visits.  Months of tireless advocacy efforts by AAPM&R and across the physician community led to CMS:

  • Conceding to several changes to their E/M proposal as well as agreeing to delay implementation of any E/M payment changes until 2021. 
  • Not implementing a 50% payment reduction for procedures billed on the same day as office and outpatient E/M visits.   This was a major emphasis of AAPM&R advocacy efforts, and we are pleased that CMS agreed to our request.  If implemented, this policy would have resulted in substantial cuts to payment for a large portion of our members.

While we are relieved that our members won’t be hit with significant payment changes on January 1, we continue to have significant concerns with the 2021 policy CMS has put forward. AAPM&R member reimbursement may be negatively impacted if the 2021 policy remains—we know it is a concern for you and it is a top priority for the Academy. We will need your support—your engagement and input—as we continue our advocacy efforts, because our fight is far from over. Stay tuned for opportunities on how to do this in the coming weeks.

Summary of E/M Reimbursement Changes

Effective January 1, 2021, CMS has finalized the following changes to office and outpatient E/M visits:

  • Collapsing of payment for level 2-4 visits for new and established patients (99202-204 and 99212-214) while maintaining payment for level 1 and level 5 visits.  For a detailed look at the new payment rates estimated for 2021, CMS has created a payment chart based on 2018 rates.  Note – this is a change from the original CMS proposal which created a collapsed payment rate for E/M levels 1-5.
  • A new flexibility in documentation requirements.  For office and outpatient visits levels 2-5, visits can be documented in one of three ways:
    • Based on current 1995 or 1997 guidelines (as visits are currently documented)
    • Using medical decision making
    • Using time-based coding (total amount of face-to-face time with beneficiary)
  • Implementation of two new add-on codes that describe resources inherent in visits for primary care and particular kinds of non-procedural specialized medical care (not restricted by medical specialty).  CMS clarifies that these add-on codes will only be permissible for office and outpatient level 2-4 visits. 
  • Implementation of a new extended visit add-on code to be used only with office and outpatient level 2-4 E/M visits to account for additional time.

CMS is implementing certain changes to documentation requirements for office and outpatient E/M visits immediately (effective January 1, 2019):

  • Clarification that for office and outpatient E/M visits, practitioners do not need to re-enter information in the medical record on the patient’s chief complaint and history that has already been entered by ancillary staff or the beneficiary. 
  • For established patients, CMS now indicates that when relevant information is already in the medical record, new documentation can focus on what has changed since the last visit, or pertinent items that have changed since the last visit. 
  • Elimination of the requirement to document the medical necessity of a home visit in lieu of an office visit. 

About MPFS

Medicare payment for physicians, and some non-physician practitioners (NPPs), is based on set rates under Medicare Part B. The system for payment, known as the Medicare Physician Fee Schedule (MPFS), is used when paying for: professional services of physicians and some NPPs; covered services incident to physicians’ services (other than certain drugs covered as incident to services); diagnostic tests (other than clinical laboratory tests); and radiology services. The MPFS also addresses various quality issues, fraud and abuse issues, and other issues that impact physicians. CMS updates the MPFS regulations annually, with comment periods open prior to implementation of the final rule.