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CMS Issues CY 2022 Physician Fee Schedule Proposed Rule

The Centers for Medicare & Medicaid Services (CMS) has released the calendar year (CY) 2022 Medicare Physician Fee Schedule (PFS) proposed rule.

In the rule, CMS proposes to adjust the conversion factor, which is used to determine physician payment rates for specific services, to $33.58 — a decrease of $1.31 compared with CY 2021. The PFS proposed rule includes other provisions important to essential hospitals, including those related to Medicare reimbursement for telehealth services, vaccine payment rates, the Quality Payment Program, and the Medicare Shared Savings Program.

The rule also includes a request for information (RFI) to address health equity through improved data collection to better measure and analyze disparities across its programs.

Appropriate Use Criteria (AUC)

CMS proposes to delay the penalty phase of the new appropriate use criteria (AUC) to the later of Jan. 1, 2023, or Jan. 1 following the end of the COVID-19 public health emergency (PHE). Pursuant to the Protecting Access to Medicare Act, CMS previously finalized a policy requiring practitioners to consult AUC when ordering applicable imaging services, with an effective date of Jan. 1, 2021. Last year, due to the COVID-19 PHE, CMS delayed the effective date of penalties for noncompliance to CY 2022. CMS now proposes another delay of the penalty phase to allow the agency and providers additional time to prepare for the AUC requirements.


Medicare reimburses practitioners under the PFS for a list of telehealth services updated through annual rulemaking. CMS does not propose to permanently add any new services to the list of reimbursable telehealth services. However, CMS proposes to extend the duration for which it will reimburse for category 3 telehealth services — certain services that were added during the COVID-19 PHE and will be reimbursed temporarily by Medicare while it examines utilization data. CMS proposes to pay for category 3 telehealth services until the end of CY 2023. In last year’s rule, CMS had finalized a policy to pay for category 3 services until the end of the year in which the COVID-19 PHE ends.

In accordance with the Consolidated Appropriations Act of 2021, CMS proposes to lift the geographic restrictions on telehealth services, including by allowing a beneficiary to receive a service while at home when the service is for the diagnosis, evaluation, or treatment of a mental health disorder. Typically, Medicare pays for a telehealth service only when the beneficiary is in a specified rural originating site at the time of the service. CMS also proposes to permit audio-only visits for mental health telehealth services furnished to beneficiaries in their home.

Payment for Vaccine Administration

CMS seeks comment on revising Medicare payment for the costs of administering Part B vaccines, which include influenza, pneumococcal, hepatitis B, and COVID-19 vaccines. The agency also seeks comment on the added $35.50 it pays for administering the COVID-19 vaccine in a beneficiary’s home, including what should qualify as a beneficiary’s home and how the agency can balance vaccine access with program integrity. Finally, CMS requests comments on payment for monoclonal antibody treatments and whether they should be reimbursed similar to other physician-administered drugs and biologicals under Medicare Part B.

Quality Payment Program

Proposals under the Quality Payment Program focus on the new Merit-based Incentive Payment System (MIPS) Value Pathways (MVPs), in addition to updates to the traditional MIPS program.

MIPS Value Pathways

The MVP framework compares the performance of similar clinicians who report on the same MVP relevant to a specialty, medical condition, or episode of care. CMS proposes to begin transitioning to MVPs in the 2023 MIPS performance year, with an aim to sunset traditional MIPS after the end of the 2027 performance and data submission periods.

CMS proposes seven MVPs available beginning with the 2023 performance period in these topic areas:

  • rheumatology;
  • stroke care and prevention;
  • heart disease;
  • chronic disease management;
  • emergency medicine;
  • lower extremity joint repair; and
  • anesthesia.

MVP scoring policies would align with those used in traditional MIPS across all performance categories, with few exceptions.

Traditional MIPS Program

CMS proposes updates across the four MIPS performance categories: quality, cost, improvement activities, and promoting interoperability. Proposed additions to the improvement activities inventory include new activities to promote health equity.

For MIPS-eligible clinicians, CMS also proposes formulas for the complex patient bonus, with two components (one for medical complexity and one for social complexity) and an overall cap of 10 bonus points.

Medicare Shared Savings Program

In the CY 2021 PFS final rule, CMS finalized a requirement that accountable care organizations (ACOs) report quality data via a new Alternative Payment Model (APM) Performance Pathway (APP). In that final rule, CMS extended the use of the CMS Web Interface as a collection type for performance year 2021 to allow ACOs the time needed to make changes necessary to report under the APP.

In response to continued concerns about the transition to reporting quality measures under the APP, CMS proposes a longer transition to this new reporting mechanism by extending the CMS Web Interface as a reporting option for performance years 2022 and 2023.

Electronic Prescribing of Controlled Substances

CMS proposes to delay implementation of the electronic prescribing of certain controlled substances covered under Medicare Part D by one year, to Jan. 1, 2023. Additionally, CMS proposes certain exceptions to the e-prescribing requirements:

  • when the prescriber and dispensing pharmacy are the same entity;
  • for prescribers who issue 100 or fewer controlled substance prescriptions for Part D drugs in a calendar year; and
  • for prescribers who are in the geographic area of a natural disaster or who are granted a waiver based on extraordinary circumstances, such as an influx of patients due to a pandemic.

RFI: Closing the Health Equity Gap

As part of an ongoing CMS effort to evaluate initiatives to reduce health disparities, the agency seeks feedback on future potential stratification of quality measure results by race and ethnicity and improving demographic data collection.

America’s Essential Hospitals is analyzing the proposed rule for comment and will send members a detailed Action Update in the coming days. Comments on the proposed rule are due to CMS by Sept. 13.

Contact Senior Director of Policy Erin O’Malley at or 202.585.0127 with questions.


About the Author

Maryellen Guinan is a principal policy analyst at America's Essential Hospitals.

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