2020 Proposed Medicare Physician Fee Schedule: What You Need to Know

The Centers for Medicare and Medicaid Services (CMS) recently published the proposed Medicare Physician Fee Schedule (PFS) for 2020. At the heart of the proposal is the annual conversion factor update. After legislatively mandated adjustments, the proposed conversion factor is $36.0896, a slight increase above the 2019 PFS conversion factor of $36.0391.

In addition to changing the payment rates for 2020, the Proposed Rule also recommends changes to several payment policies. We’ve highlighted a few of the biggest changes below.

E/M Changes

One of the biggest changes proposed by CMS is an overhaul of office/outpatient E/M visits, which according to a recent Medicare Learning Network call, account for 20 percent of all PFS dollars. In effect, CMS is proposing to undo last year’s rule, which rolled up levels 2 through 4 for established and new patients into a single rate with similar documentation requirements beginning in 2021. Instead, CMS has proposed adopting the changes in description and documentation guidelines the American Medical Association has made to the CPT codes for office/outpatient E/M visits.

According to the CMS Fact Sheet on the proposed changes, the new CPT guidelines retain 5 levels of coding for established patients and reduce the number of levels to 4 for office/outpatient E/M visits for new patients. The CPT changes also revise the times and medical decision making process for all of the codes, allow clinicians to choose the E/M visit level based on either medical decision making or time, and require performance of history and exam only as medically appropriate. 

CMS also is proposing to adopt the AMA RUC-recommended updated values for the office/outpatient E/M visit codes, which will increase payments for these services. See the chart below for how these changes could broadly affect payments before geographic adjustments:

*Current Payment for CY2019
**Proposed Payment based on the CY2020 proposed relative value units and the CY2019 payment rate

The 2019 final rule also included two add-on codes for use beginning in 2021 to describe the additional resources inherent in visits for primary care and particular kinds of non-procedural specialized medical care. In the 2020 proposed rule, CMS hopes to consolidate those add-on codes into a single code describing the work associated with visits that are part of ongoing, comprehensive primary care and/or visits that are part of ongoing care related to a patient’s single, serious, or complex chronic condition. As well, CMS is proposing to use a new CPT code (CPT 99xxx) for prolonged services that extend time beyond in lieu of GPRO1 (the extended service code), which was adopted in 2019 for use beginning in 2021, and CPT codes 99358, 99359 (prolonged non-face-to-face). Payment for the add-on code for complex cases would be $17, and the payment for the prolonged services code would be $35.

Building off last year’s rule, CMS also hopes to continue modifying documentation policies so that physicians, physician assistants, nurse practitioners, clinical nurse specialists, and certified nurse-midwives can review and verify (sign and date), rather than re-document, notes made in the medical record by other physicians, residents, nurses, students, or  other members of the medical team.

CMS currently has no proposals for modifying other E/M code sets, though they are continuing to receive comments on possible updates.

Care Coordination and Management

In addition to changes to office/outpatient E/M visits, CMS is proposing several changes to care coordination and management codes.

First, CMS is proposing to increase payment for Transitional Care Management (TCM), which is a care management service provided to beneficiaries after discharge from an inpatient stay or certain outpatient stays.

Next, CMS is proposing to create a new set of HCPCS G codes for certain Chronic Care Management (CCM) services. Basically, the new codes would replace a number of existing CCM codes with Medicare-specific codes, allowing clinicians to bill incrementally for additional time and resources required in certain cases and to better distinguish complexity of illness as measured by time. These changes would also come with adjustments to certain billing requirements and elements of the care planning services to help reduce the administrative burden on providers.

Finally, CMS is proposing a new code for Principal Care Management (PCM) services, which would pay clinicians for providing care management for patients with single serious and high risk conditions. This change recognizes that clinicians across all specialties manage the care of beneficiaries with chronic conditions.

Ground Ambulance Data Collection System

The Bipartisan Budget Act (BBA) of 2018 mandates the development of a data collection system to collect cost, revenue, utilization, and other information from ground ambulance providers suppliers. In the 2020 PFS proposed rule, CMS outlines a potential data collection format, as well as a sampling methodology that CMS would use to identify ground ambulance organizations for reporting each year through 2024 and not less than every 3 years after 2024. The proposal also would reduce payments by 10 percent for ground ambulance organizations that are identified for reporting but fail to sufficiently submit data. A hardship exemption request process would also be created to allow certain ground ambulance organizations, who do not report as requested, to avoid the payment reduction.

Quality Payment Program MIPS

Several updates to the MIPS program for the 2020 performance year (2022 payment year) are being proposed according to previously published implementation plans, as well as a new MIPS Value Pathways program for 2021 to simplify MIPS participation.

Quality and Cost Performance Category Weighting

The proposed rule would reduce the Quality performance category weight to 40 percent in 2020, 35 percent in 2021, and 30 percent in 2022, down from 45 percent in 2019. Alternately, the proposed rule would increase the Cost performance category weight to 20 percent in 2020, 25 percent in 2021, and 30 percent in 2022, up from 15 percent in 2019. These changes help to achieve mandated equal weighting of the Quality and Cost performance categories, which is required by law beginning with the sixth year of the program (2022 performance year). 

Performance Threshold and Payment Adjustments

Also for the 2020 performance period, the performance threshold would be 45 points, and the exceptional performance threshold would be 80 points, up from 30 and 75 points, respectively, in 2019. For 2021, the performance threshold would be set at 60 points, and the exceptional performance threshold would be set at 85 points. As well, in 2020, the MIPS program would reach the maximum negative payment adjustment of -9 percent, with positive payment adjustments up to a factor of 9 percent. Because the program is budget neutral, positive payments adjustments could be above or below 9 percent. The payment adjustment percentage for 2019 was 7. 

Performance Category Updates

Among the various performance categories, the following updates and changes are proposed for 2020 and beyond:

• Quality: Remove low-bar, standard of care, process measures, focus on high-priority outcome measures, and add new specialty sets (Speech Language Pathology, Audiology, Clinical Social Work, Chiropractic Medicine, Pulmonology, Nutrition/Dietician, and Endocrinology). Data completeness requirements also would increase to 70 percent for 2020, up from 60 percent in 2019.
• Cost: Add 10 episode-based measures and revise current global measures’ attribution methodologies (TPCC and MSPB Clinician).
• Improvement Activities: New requirement for Improvement Activity credit for groups (at least 50% of MIPS eligible clinicians participate). Also, update measures with the addition of two new Improvement Activities, modification of seven existing Improvement Activities, and removal of 15 existing Improvement Activities.
• Promoting Interoperability: New reweighting standards for hospital-based MIPS eligible clinicians in groups. A group would be identified as hospital-based and eligible for reweighting if more than 75 percent of the NPIs in the group meet the definition of a hospital-based individual MIPS eligible clinician. In previous years, 100 percent of a groups NPIs had to be hospital-based. Non-patient facing groups (more than 75 percent of the MIPS eligible clinicians in the group are classified as non-patient facing) would automatically have the Promoting Interoperability performance category reweighted.

MIPS Value Pathways

Finally, CMS is proposing a new program for MIPS participation called MIPS Value Pathways (MVPs). The program is described as “a conceptual participation framework” that would be in effect for the 2021 performance year. MVPs would help move MIPS “away from siloed activities and measures and … towards an aligned set of measure options more relevant to a clinician’s scope of practice that is meaningful to patient care.”

In effect, the MVP framework would do three things:

• Unite and connect measures and activities across the Quality, Cost, Promoting Interoperability, and Improvement Activities performance categories.
• Incorporate a set of administrative claims-based quality measures that focus on population health/public health priorities.
• Streamline MIPS reporting by limiting the number of required specialty or condition specific measures.

“We believe this combination of administrative claims-based measures and specialty/condition specific measures would streamline MIPS reporting, reduce complexity and burden, and improve measurement,” CMS officials said in the fact sheet about the proposal.

CMS has created a collection of illustrative diagrams (automatic download from CMS) to help explain the changes that the MVP framework would bring.

For More Information

For more information about the 2020 Medicare Physician Fee Schedule Proposed Rule and the 2020 Quality Payment Program Proposed Rule, check out the following resources:

• Proposed Policy, Payment, and Quality Provisions Changes to the Medicare Physician Fee Schedule for Calendar Year 2020 Fact Sheet
• 2020 Quality Payment Program Proposed Rule Overview Factsheet (Automatic Download)
• Medicare Learning Network Listening Session: Physician Fee Schedule Proposed Rule: Understanding 3 Key Topics
• Proposed Policy, Payment, and Quality Provisions Changes to the Medicare Physician Fee Schedule for Calendar Year 2020 Full Text

Submit Your Comments

If you wish to submit comments about these or other issues in the proposed 2020 Medicare Physician Fee Schedule or the 2020 Quality Payment Program Proposed Rule, CMS offers the following instructions:

In commenting, please refer to file code CMS-1715-P. Because of staff and resource limitations, CMS cannot accept comments by FAX transmission. Comments, including mass comment submissions, must be submitted in one of the following three ways (please choose only one of the ways listed):

• Electronically. You may submit electronic comments on this regulation to http://www.regulations.gov. Follow the “Submit a comment” instructions.
• By regular mail. You may mail written comments to the following address ONLY: Centers for Medicare & Medicaid Services, Department of Health and Human Services, Attention: CMS-1715-P, P.O. Box 8016, Baltimore, MD 21244-8016. Please allow sufficient time for mailed comments to be received before the close of the comment period.
• By express or overnight mail. You may send written comments to the following address ONLY: Centers for Medicare & Medicaid Services, Department of Health and Human Services, Attention: CMS-1715-P, Mail Stop C4-26-05, 7500 Security Boulevard, Baltimore, MD 21244-1850.

Be sure to submit your comments to CMS by no later than 5 p.m. on September 27, 2019.

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