2020 Proposed CMS Rule for the Medicare Physician Fee Schedule: CMS-1715-P

2020 Proposed CMS Rule for the Medicare Physician Fee Schedule: CMS-1715-P

On August 14, 2019, CMS published the proposed rule for the 2020 Medicare physician fee schedule. Overall, CMS estimates that emergency medicine will undergo a 1% increase in payments in 2019.

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. CMS estimates a 2020 conversion factor of 36.0686. The 2019 conversion factor is 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 have not occurred for a variety of reasons. Because of budget neutrality provisions ingrained within the Medicare physician fee schedule, the conversion factor is used to balance out any items that cause increased Medicare spending over projected amounts.

Relative Value Units for 2020

CMS has proposed modest RVU changes for emergency service codes in 2020. For 2020, the Work RVUs are slightly increased for certain codes based on a revaluation exercise conducted by the AMA RUC. Practice Expense RVUs are nearly identical to 2019. Surprisingly, Malpractice RVUs were increased for most codes. Table One illustrates the proposed 2020 RVUs for emergency services codes, and compares RVUs to 2019 values. In comparison to 2019, total RVU values have increased by 2.0% in 2020.

Table Two illustrates the expected “national value” fees for emergency services evaluation and management codes.

Redistribution

In the Rule, CMS is proposing groundbreaking payment policy changes that will result in significant redistribution of Medicare physician payments to primary care providers in office based settings. CMS is proposing significant increases in Work RVUs for the office visit CPT codes based upon a revaluation exercise performed by the AMA RUC. Also, CMS is proposing two additional codes that are intended to 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. The mechanism that CMS will use in order to maintain budget neutrality is a reduction in the conversion factor.

CMS is proposing that increased office visit payments 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 proposing elimination of CPT code 99201 – new patient office visit. Tables Five and Six illustrate the new Work RVUs that the RUC proposed and ones that CMS is proposing.