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Experience. Integrity. Advocacy.

2018 Medicare Physician Fee Schedule Final Rule

2018 Medicare Physician Fee Schedule Final Rule

The Centers for Medicare and Medicaid Services (CMS) recently finalized the 2018 Medicare Physician Fee Schedule (MPFS) and related policies, giving physicians and other eligible providers a .41 percent increase as proposed back in July.

This update reflects the .50 percent update established under the Medicare Access and CHIP Reauthorization Act (MACRA) of 2015, reduced by 0.09 percent, due to the misvalued code target recapture amount, required under the Achieving a Better Life Experience Act of 2014. By applying these adjustments, plus the budget neutrality adjustment for changes in RVUs, to the 2017 PFS conversion factor of $35.89, the proposed 2018 PFS conversion factor is $35.9996.

Payment rates for individual services are then calculated by locality using the following formula: Payment = [(RVU work x GPCI work) + (RVU PE x GPCI PE) + (RVU MP x GPCI MP)] x CF. Indiana and Michigan providers can find an updated fee schedule on the WPS-GHA 2018 Medicare Physician Fee Schedules (MPFS) page.

Anesthesia Conversion Factor

For anesthesiologists, the calculation for the 2018 anesthesia conversion factor — $22.1887 — also results in a slight increase from the 2017 rate of $22.0454. Indiana anesthesiologists, however, will see that anesthesia conversion factor adjusted for locality to $20.53 in 2018, down from $21.09 in 2017.

Outpatient Provider-Based Department Payments

As well, CMS finalized a reduction in payment rate for certain items and services furnished by off-campus hospital outpatient provider-based departments. Since January 2017, these services have been paid under the MPFS based on provisions of Section 603 of the Bipartisan Budget Act of 2015. For 2018, the PFS payment rates for these services will be reduced from 50 percent of the OPPS payment rate to 40 percent of the OPPS rate. (CMS had proposed dropping the rate to 25 percent of the OPPS rate, but approved the higher amount in the final rule.) According to CMS, “this adjustment will provide a more level playing field for competition between hospitals and physician practices by promoting greater payment alignment.”


CMS also finalized their proposal to expand the list of allowed telehealth services for 2018, including the following:

  • HCPCS code G0296 (visit to determine low dose computed tomography (LDCT) eligibility);
  • CPT code 90785 (Interactive Complexity);
  • CPT codes 96160 and 96161 (Health Risk Assessment);
  • HCPCS code G0506 (Care Planning for Chronic Care Management); and
  • CPT codes 90839 and 90840 (Psychotherapy for Crisis).

Additionally, the required reporting of the telehealth modifier GT for professional claims has been eliminated as part of CMS’s effort to reduce administrative burden for practitioners.

Quality Reporting

While the PQRS and Value Modifier programs have been replaced with the MACRA Quality Payment Program’s Merit-based Incentive Payment System (MIPS), physicians may still experience the impact of the PQRS/Value Modifier penalties in 2018, based on the 2016 reporting year. The data for that final reporting year had to be submitted by March 2017, so physicians can no longer adjust their submissions. However, CMS is finalizing their proposals to modify the performance guidelines to better align the past programs with the new MIPS guidelines.

Specifically, CMS is changing the current PQRS program policy that requires reporting 9 measures across 3 National Quality Strategy domains to require only 6 measures.

Likewise, for the Value Modifier, CMS is finalizing the following changes:

  • Reduce the automatic downward payment adjustment for not meeting minimum quality reporting requirements from -4 percent to -2 percent for groups of ten or more clinicians; and from -2 percent to negative -1 percent for physician and non-physician solo practitioners and groups of two to nine clinicians;
  • Hold harmless all physician groups and solo practitioners who met minimum quality reporting requirements from downward payment adjustments for performance under quality-tiering for the last year of the program; and
  • Align maximum upward adjustment amounts to 2 times the adjustment factor for all physician groups and solo practitioners.

For more information about the 2018 Medicare Physician Fee Schedule, review the CMS Fact Sheet or the complete Final Rule.

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Charity Singleton Craig

Charity Singleton Craig is a freelance writer and editor who provides communications and marketing services for CIPROMS. She is responsible for creating, editing, and managing all content, design, and interaction on the company website and social media channels in order to promote CIPROMS as a thought leader in healthcare billing and management.

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