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CMS Issues CY 2024 Medicare Physician Fee Schedule Final Rule

Shahid Zaman
November 3, 2023

The calendar year (CY) 2024 Medicare Physician Fee Schedule (PFS) final rule will decrease physician payments, expand access to telehealth for Medicare beneficiaries, target social determinants of health (SDOH), and make other payment and quality reporting changes.

The rule, which the Centers for Medicare & Medicaid Services (CMS) released Nov. 2, will adjust the conversion factor, which CMS uses to determine physician payment rates for specific services, to $32.74 — a decrease of $1.15, compared with CY 2023. Other important chances are detailed below.


Medicare reimburses practitioners under the PFS for a list of telehealth services updated through annual rulemaking. CMS finalized its proposal to add permanent payment for SDOH risk assessments and to reimburse temporarily for health and well-being coaching services in CY 2024. The agency also finalized changes to its process for evaluating requests from the public to add services to the telehealth services list.

CMS finalized its plan to implement telehealth provisions of the Consolidated Appropriations Act, 2023. This includes extending flexibility for telehealth through Dec. 31, 2024, including by:

  • Expanding the types of originating sites where a beneficiary can be when receiving a telehealth service, including the beneficiary’s home. Practitioners providing services to beneficiaries in their homes will receive payment at the higher, non-facility PFS rate, beginning in CY 2024.
  • Including qualified physical therapists, occupational therapists, and speech-language pathologists as eligible telehealth practitioners. This will allow these practitioners to furnish and bill for telehealth services during this time.
  • Delaying requirements for an in-person visit prior to initiating mental health telehealth visits.
  • Allowing coverage and payment of certain telehealth services furnished via an audio-only communications system, including allowing opioid use disorder treatment programs to bill for periodic assessments provided through audio-only telecommunications technology when permitted by other applicable laws and regulations.

During the COVID-19 public health emergency (PHE), CMS changed the definition of direct supervision to allow virtual presence through two-way, audio/video technology instead of requiring physical presence, which facilitated the provision of telehealth services by clinicians. CMS finalized a proposal to continue allowing direct supervision through virtual presence via real-time audio/video technology through the end of 2024.

CMS also finalized a proposal to allow teaching physicians to oversee services provided by residents using audio/video real-time communications technology at all residency training locations through the end of 2024.

Appropriate Use Criteria for Advanced Diagnostic Imaging

CMS finalized its proposal to halt the Appropriate Use Criteria (AUC) for Advanced Diagnostic Imaging Program and to rescind the AUC program regulations. Pursuant to the Protecting Access to Medicare Act, CMS previously finalized a policy requiring practitioners to use a clinical decision support mechanism to consult AUC when ordering applicable imaging services. CMS postponed the penalty phase of the AUC program multiple times and has allowed practitioners to operate under an educational and operations testing period since 2020. Due to challenges with successfully implementing the program’s requirements, CMS will pause the program indefinitely while it reevaluates its feasibility. CMS says it will continue to assess the best approach to implementing the AUC requirements and propose this through future rulemaking.

Quality Programs

Merit-based Incentive Payment System (MIPS) Value Pathways (MVPs)

CMS finalized five new MVPs for the 2024 performance period:

  • Focusing on Women’s Health.
  • Quality Care for the Treatment of Ear, Nose, and Throat Disorders.
  • Prevention and Treatment of Infectious Disorders Including Hepatitis C and HIV.
  • Quality Care in Mental Health and Substance Use Disorders.
  • Rehabilitative Support for Musculoskeletal Care.

CMS finalized the proposal to revise previously finalized MVPs, including consolidating the Promoting Wellness and Optimizing Chronic Disease Management MVPs into a single primary care MVP.

Traditional MIPS Program

For the quality performance category, CMS is adding 11 new quality measures instead of the proposed 14 for the 2024 performance period. This includes one composite measure and six high priority measures.

CMS also finalized proposals to:

  • Maintain the 75 percent data completeness threshold for 2024.
  • Require Spanish translation of the Consumer Assessment of Healthcare Providers and Systems for MIPS survey.
  • Modify how ICD-10 coding updates are assessed.
  • Calculate cost improvement scoring at the category level instead of measure level.

Medicare Shared Savings Program (MSSP)

CMS finalized the proposal to expand the window for patient assignment in the MSSP, which would assign beneficiaries prospectively to an accountable care organization (ACO). This change could lead to more ACOs meeting the minimum size requirements, potentially resulting in larger assigned populations and lower minimum savings rates for ACOs under certain risk models.

Advance Investment Payments

CMS finalized its proposal to refine the advance investment payment (AIP) policies for ACOs entering agreement periods on Jan. 1, 2024, to allow ACOs receiving AIPs to advance to two-sided risk models sooner and recoup AIPs from shared savings payments instead of directly from the ACO.

Medicare Clinical Quality Measures

CMS finalized the proposal to establish Medicare Clinical Quality Measures (CQMs) as a new collection type for reporting quality measures under the Alternative Payment Model Performance Pathway. This will help ACOs transition to digital measurement by initially focusing on their Medicare patients.

Align with Merit-based Incentive Payment System Certified Electronic Health Record Technology Requirements

CMS finalized the proposal to align Shared Savings Program Certified Electronic Health Record Technology (CEHRT) requirements with MIPS by removing the current CEHRT thresholds and requiring all participating clinicians to report the MIPS Promoting Interoperability performance category measures.

Health Equity Adjustment

CMS finalized a proposal to make more beneficiaries eligible for the health equity adjustment by calculating dual eligibility for Medicare and Medicaid, as well as enrollment in the Medicare Part D Low Income Subsidy, based on partial year enrollment.

Risk Adjustment

CMS finalized a proposal to apply the same CMS Hierarchical Condition Category risk adjustment model used for the performance year to all benchmark years starting in 2024.

Regional Adjustment

CMS finalized changes to further mitigate the effect of negative regional adjustments to benchmark updates.

Beneficiary Assignment

CMS finalized a provision to add a new step to the assignment methodology to better account for beneficiaries receiving primary care from nurse practitioners, physician assistants, and clinical nurse specialists.

Social Determinants of Health

CMS finalized several policies related to SDOH.

Medicare Annual Wellness Visits

The Annual Wellness Visit (AWV) under Medicare Part B is a comprehensive preventive visit for eligible beneficiaries. CMS finalized the proposal to add to the AWV an optional SDOH Risk Assessment, which aims to enhance patient-centered care, identify social risks earlier, and respond to resulting health needs proactively through care planning and coordination.

The SDOH Risk Assessment involves administering a standardized, evidence-based, and culturally and linguistically appropriate SDOH risk assessment tool that considers the patient’s educational, developmental, and health literacy level. It will be separately payable with no cost sharing for beneficiaries when performed as part of the AWV.

This provision builds on the CMS initiative to establish a stand-alone payment code for SDOH Risk Assessment in conjunction with an evaluation and management (E/M) visit.

New HCPCS G-code for SDOH Data Collection

CMS finalized a proposal to establish a new HCPCS code, G0136, that will allow practitioners to bill Medicare for administering a standardized SDOH screening tool during certain E/M visits.

The full descriptor for G0136 is: “Administration of a standardized, evidence-based Social Determinants of Health Risk Assessment tool, 5-15 minutes, not more often than every 6 months.” This code will be billable when a provider spends at least five minutes administering a structured, evidence-based SDOH screening tool as part of an E/M visit. CMS modified its proposed policy so that it no longer will require the SDOH risk assessment be performed on the same day as the E/M visit.

CMS believes this code will improve consistent screening and documentation of SDOH data in the medical record. This data then can inform patient diagnoses, care planning, and coordination.

CMS identified seven SDOH domains that screening tools can address:

  • Economic stability.
  • Education.
  • Health care access and quality.
  • Neighborhood and environment.
  • Food.
  • Community and social context.
  • Social relationships.

Behavioral Health Services

CMS finalized several proposals related to behavioral health services, including:

  • Providing Medicare Part B coverage and payment for services of marriage and family therapists (MFTs) and mental health counselors (MHCs) and allowing addiction counselors or drug and alcohol counselors to enroll in Medicare as MHCs.
  • Adding payment codes for psychotherapy for crisis services provided in an applicable site of service.
  • Allowing MFTs, MHCs, clinical social workers, and clinical psychologists to bill for certain health behavior assessment and intervention services.
  • Increasing payment for timed behavioral health services over a four-year transition period.

Payment for Vaccine Administration

CMS previously finalized a policy to provide additional payment for administering a COVID-19 vaccine in a beneficiary’s home. CMS finalized a proposal to provide additional payment for the administration of three other preventive vaccines covered by Part B — the pneumococcal, influenza, and hepatitis B vaccines — when they are provided in the beneficiary’s home.

Contact Director of Policy Rob Nelb, MPH, at or 202.585.0127 with questions.

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