2020 Final CMS Rule for the Medicare Physician Fee Schedule: CMS-1715-F

2020 Final CMS Rule for the Medicare Physician Fee Schedule: CMS-1715-F

On November 15, 2019, CMS published the final rule for the 2020 Medicare physician fee schedule. Overall, CMS estimates that emergency medicine will realize a slight increase in payments in 2020.

The basic payment formula remains: (RVU work x GPCI work) + (RVU P.E.  x GPCI P.E.) + (RVU M x GPCI M) = RVU TOTAL x Conversion Factor = Fee for each CPT® Code

Conversion Factor Updates

The April 2015 MACRA (Medicare Access and CHIP Reauthorization ACT) legislation provided a permanent fix to the SGR-related conversion factor reduction. The 2020 conversion factor is 36.0896. The 2019 conversion factor was 36.0391. This represents a 0.14% increase in the 2020 conversion factor versus 2019. 

MACRA called for 0.50% annual increases in the conversion factor for 2016 through 2019. These 0.50% increases did not fully occur for a variety of reasons. Unless Congress reinstates mandated annual increases in the conversion factor, there will no longer be automatic annual increases.

CMS Review of Work RVUs for Emergency Services

In 2017, CMS stated that they received comments that emergency service CPT code work RVUs (99281 through 99285) may be undervalued. The source of these comments is unknown. CMS requested that the AMA’s Relative Value Update Committee (RUC) evaluate the work RVUs for these emergency services evaluation and management codes. RUC surveyed these codes, and met in the spring of 2018. The result of the RUC’s revaluation exercise were small increases to the Work RVU for 99283 and 99284. The Work RVU for 99285 remained the same. CMS incorporated the RUC revaluation values when publishing the 2020 work RVUs for emergency services.

Relative Value Units for 2020

CMS also finalized small malpractice expense RVU increases for emergency service codes in 2020. For 2020, the Practice Expense RVUs are nearly identical to 2019. Table One illustrates the final 2020 RVUs for emergency services codes, and compares total RVUs to 2019 values.

Redistribution

In the Final Rule, CMS created groundbreaking payment policy changes that will result in significant redistribution of Medicare physician payments to primary care providers in office-based settings. CMS finalized increases in Work RVUs for the office visit CPT codes based upon a revaluation exercise performed by the AMA RUC. In addition, CMS finalized two additional codes that may be used by primary care providers.  Via the budget neutrality provisions of the Medicare Physician Fee Schedule, increases in office visit payments will come at the expense of providers who derive payments from sites of service outside the office. Emergency services fall into this latter category. Payments for evaluation and management services currently compose 40% of Medicare physician payments, with office visits accounting for half of that amount. By increasing office visit payments across the board, budget neutrality requires a reduction in Medicare payments for all other CPT codes. CMS will use a reduction in the conversion factor in order to maintain budget neutrality.

CMS states that increased office visit payments will begin in 2021. This timeframe allows interested parties to comment on this major new CMS payment policy. The 2021 Medicare Physician Fee Schedule Final Rule will be published in November 2020. BSA Healthcare expects that specialties other than primary care will vigorously oppose this new payment policy, especially the reduction in payments to non-primary care providers.

CMS is also eliminating payment for CPT code 99201 – new patient office visit. Tables Two and Three illustrate the new Work RVUs that CMS finalized. One significant difference from the RVUw values in this past summer’s Proposed Rule is that CMS accepted the full RUC-suggested increases in RVUw for 99212 and 99214. These two commonly used codes had been valued by CMS in the Proposed Rule at 0.56 and 1.81. Acceptance of these higher values by CMS serves to accentuate the amount of Medicare funds that will be redistributed to primary care providers.

CMS also finalized the addition of two codes for use by primary care providers. The first code, prolonged services for every 15 minutes, will have a Work RVU of 0.61. The second is a HCPCS code for additional work and will have a Work RVU of 0.33.

Effects on Emergency Services E&M Codes

Because of budget neutrality lowering of the conversion factor, if the new code valuations and additional codes are finalized in 2021 by CMS, there will be an expected 7% reduction in emergency services payments in 2021.

There are a number of variables that may influence the final impact for emergency medicine. First, whether CMS chooses to institute all the office visit Work RVU changes in the 2021 Final Rule. Second, expected robust negative comments by non-office visit specialties may sway CMS over the next 12 months. Last, emergency service E&M codes 99281 through 99283 have always had a Work RVU linkage to office visit codes 99201 through 99203 (and by extension, the higher levels 99284 and 99285). If the RUC and CMS allow this linkage to be maintained the Work RVU values for 99281 through 99285 may increase.

BSA Healthcare’s opinion is Emergency Medicine needs to begin coalition advocacy efforts now in order to reverse negative 2021 impact on emergency service E&M fees as well as fee reductions for other codes utilized by coalition partners.