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Physician Fee Schedule Proposed Rule Released

The Centers for Medicare & Medicaid Services (CMS) released a Medicare Physician Fee Schedule (PFS) proposed rule for calendar year (CY) 2020.

The PFS proposed rule includes these provisions of interest to essential hospitals:

  • Payment update: CMS proposes to adjust the annual physician payment rate by 0.14 percent;
  • Site-neutral payments: The rule does not mention the continuation of reduced payments to new off-campus provider-based departments (PBDs) under Section 603 of the Bipartisan Budget Act of 2015 (BBA). For CY 2020, it is assumed that CMS will continue to pay these PBDs at 40 percent of the OPPS rate. We will confirm that information upon further review;
  • Telehealth services: As part of several provisions related to treatment of opioid use disorder (OUD), CMS proposes to add three new codes describing a bundled episode for OUD treatment to the list of telehealth services for which it will reimburse Medicare providers;
  • Evaluation and management (E/M) services: CMS proposes to use a separate payment for each of the five levels of E/M visit codes, reversing the blended payment rates established in the CY 2019 final rule.

Quality Payment Program Updates

Under the QPP, eligible clinicians participate in one of two tracks: the default Merit-based Incentive Payment System (MIPS) or Advanced Alternative Payment Models (APMs).

For CY 2020 — year four of the program — CMS proposes to maintain many of the requirements from the 2019 performance year while providing new policies allowing clinicians to choose how to participate in either the MIPS or Advanced APM tracks.

For MIPS, CMS proposes several changes, including:

  • increasing the performance threshold for earning positive payment adjustments;
  • maintaining the option to use facility-based scoring (for quality and cost measures) that does not require data submission for facility-based clinicians;
  • retaining bonus points in the scoring methodology for the care of complex patients;
  • updating weights for the four performance categories;
  • continuing removal of process-based quality measures that are low-value or low-priority;
  • adding new specialty sets in the quality performance category; and
  • adding 10 new episode-based measures and revising the current measures in the cost performance category; and
  • seeking comment on potential opioid measures for inclusion in the promoting interoperability performance category.

For Advanced APMs, CMS proposes:

  • maintaining the existing 8 percent revenue-based nominal risk standard through performance year 2024;
  • applying partial qualifying APM participant (QP) status only to the tax identification number/national provider identifier combination(s) through which an individual eligible clinician attains partial QP status, beginning with the 2020 QP performance period; and
  • requesting comment on APM scoring beyond 2020.

MIPS Value Pathways

In a request for information, CMS proposes the creation of MIPS Value Pathways (MVPs) to focus participation on specific meaningful measures or public health priorities, while facilitating movement to the Advanced APM track with the goal of aligning measure sets. MVPs aim to align and connect measures and activities across the four performance categories of MIPS for different specialties or conditions. This new participation framework would be introduced over time, beginning with CY 2021 reporting.

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. 27.

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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