The conversion factor was increased twice in one week.
The Centers for Medicare & Medicaid Services (CMS), in a rare move, recently raised the conversion factor (CF) twice in one week, resulting in an adjustment of approximately $34.89 for 2021. The action by CMS marked a last-minute slight increase to the amount in the already passed COVID-19 relief bill. Adjust your calculations accordingly, and remember that this is a one-year fix. See below for more details.
On Dec.1, 2020, CMS issued its Final Rule on the Medicare Physician Fee Schedule (1734-F MPFS) and other policies and regulations that are slated to start take effect on or after Jan. 1, 2021. The 2,165-page document has a lot of information on many different policies, so a few points highlighted here will be the primary focus for many medical practices. You can also find the full Final Rule online at https://public-inspection.federalregister.gov/2020-26815.pdf.
Conversion Factor 2021 (Plus a One-year Fix for COVID Relief)
Physicians were facing a 10.2-percent drop in the Medicare CF, starting Jan. 1, 2021, as an offset to broad new increases in reimbursement rates for evaluation and management (E&M) office and other outpatient visits and other similar services. Due to increases in the relative value units (RVUs) on E&M services and rate-setting refinements to update premium data for malpractice expense and geographic practice cost indices (GPCIs), the CF was set to decrease to $32.41 from its 2020 rate of $36.09. The CF decline was due to Medicare’s budget neutrality mandate, which CMS says they were unable to waive. The COVID-19 relief bill, signed into law on Dec. 28, added an increase of 3.75 percent to the current fee schedule. This would have increased the 2021 CF to $33.63; however, on Jan. 5, 2021, CMS confirmed that they found some extra “budget relief money” to bring the CF to $34.89. This is only a temporary fix for one year. Anticipate that in 2022, the conversion factor will drop to that of the original 2021 final rule.
The RVU files finalized on Dec. 28 for Jan. 1 are set and will not change.
Medicare Payments Sequestration Deduction Extended
The budget sequestration moratorium of 2012, which deducted 2 percent from Medicare payments to account for the debt ceiling increase offset, was scheduled to end Dec. 31, but is now extended to March 31, 2021.
Evaluation and Management Services, Office, and Other Outpatient Visits
The Final Rule affirms that CMS is accepting most of the changes for the new office/other outpatient E&M services. In the Final Rule, it states that E&M visits account for about 40 percent of allowed charges, with new and established office and other outpatient E&M services accounting for about 20 percent of allowed charges. CMS agreed that the current system for “counting” body areas and organ systems is outdated.
The Final Rule confirms the following regarding the E&M codes 99202-99215:
- 99201 will be deleted
- Levels may be chosen by either medical decision-making (MDM; also, and revisions have been made to this table for 2021) or time
- Only a medically appropriate history and examination for the encounter needs to be documented
- When coding by “time,” the entire time spent by the physician or other qualified healthcare professional on the day of the visit (whether face-to-face or non-face-to-face) can be used to choose a level of E&M service (verify the services list that can be included in the time on the AMA website and in the 2021 CPT Book)
Visit Complexity Add-On HCPCS Code Stalled
G2211 will ultimately replace code GPC1X.
This code is defined as a visit complexity code inherent to E&M, associated with medical care services that serve as the continuing focal point for all needed healthcare services – and/or with medical care services that are part of ongoing care related to a patient’s single, serious condition or complex condition (an add-on code in addition to an office or other outpatient new or established patient visit). The Final Rule elaborated on when and when not to use this add-on code.
COVID-19 Relief Bill Alert
The aforementioned relief bill calls for a three-year suspension (through December 2023) of payments for the HCPCS code G2211. The G2211 code accounted for about $3 billion (or 3 percent) of spending in the Medicare payment schedule, so the delay in implementing the code further reduces the budget-neutrality adjustment and allows a path for paying for the one-year, 3.75-percent increase.
Prolonged Services for 2021
There is a point of contention between CMS and the American Medical Association (AMA) wherein CMS does not agree with the AMA-CPT® on prolonged services qualifications for time. CMS disagrees with CPT’s view of when the counting of prolonged service time should start. Due to this, CMS has created a HCPCS II code, G2212, to use in place of 99417. Medicare states that the “maximum” time needs to be met on the Level 5 visit code before the new prolonged services code can be appended to Level 5. CPT® states that the “minimum” time has to be met before prolonged time sets in. Be sure to watch for more on this from CMS to ensure that you are reporting prolonged services correctly for Medicare patients. This code is an audit waiting to happen. Remember, this is only used if you are leveling your E&M office visit code based on time, and only used as an add-on to a Level 5 new or established patient visit.
Telehealth in 2021
There were also many changes finalized for telehealth. In its filing, CMS discussed the new categories of telehealth services and how they would be used. If you need a more in-depth look at this, I will be presenting a webcast, Telehealth 2021, via ICD10University on Jan. 28.
Here are the categories for telehealth coverage:
- Category 1: These codes are permanently added as covered under Medicare telehealth services, as they are considered to be similar to services currently on the list.
- Category 2: These codes are permanently added as covered under Medicare telehealth services, but are not similar to services currently on the list. In order to be considered for coverage, CMS requires clinical studies demonstrating the service furnished via telehealth improves the patient’s diagnosis or treatment of an illness or injury and copies of published peer-reviewed articles relevant to the service when performed via telehealth.
- Category 3: These codes are temporarily covered under the Medicare Telehealth List through the end of the year in which the public health emergency (PHE) for COVID-19 ends, allowing CMS to evaluate whether they should become Category 1 or Category 2 codes.
Here is a complete list of Category 3 Telehealth services for 2021:
- End-stage Renal Disease Codes: 90952, 90953, 90956, 90959, 90962
- Emergency Department Visits: 99281, 99282, 99283, 99284, 99285
- Domiciliary/Rest Home/Custodial Care Services: 99336, 99337
- Home Visits, Established Patients: 99349, 99350
- Nursing Facility Discharge Day Management: 99315, 99316
- Psychological and Neuropsychological Testing: 96121, 96130, 96131, 96132, 96133, 96136, 96137, 96138, 96139
- Therapy Services: 97161, 97162, 97163, 97164, 97165, 97166, 97167, 97168, 97110, 97112, 97116, 97535, 97750, 97755, 97760, 97761, 92521, 92522, 92523, 92524, 92507
- Subsequent OBS/OBS Discharge Day Management: 99217, 99224, 99225, 99226
- Initial Hospital Care/Discharge Day Management: 99221, 99222, 99223, 99238, 99239
- Critical Care Services: 99291, 99292
- Inpatient Neonatal/Pediatric Subsequent Critical Care: 99469, 99472, 99476
- Continuing Neonatal Intensive Care: 99478, 99479,99480
The Biggest Telehealth Takeaway for 2021
According to the 2021 CMS Final Rule, after the end of PHE, there will be no separate payment for the audio-only CPT codes. “At the conclusion of PHE, we will assign a status of ‘bundled’ and post the RUC-recommended RVUs for these codes in accordance with our usual practice,” the relevant language reads.
“Therefore at the end of PHE, in 2021, a new HCPCS code will be created, G2252, as an 11-20-minute audio-only code cross-walked to code 99442 to allow for an encounter when the physician may not be able to have an encounter to visualize the patient,” the Final Rule adds. This is similar to the virtual check-in codes, but will be used when the acuity of the patient’s problem is not likely to warrant a visit in person. It will be for established patients only, and the same seven-day/next 24-hour rule applies.
CMS will be tracking this code, as with all temporary G codes, and again, this is slated to take effect at the conclusion of the PHE.
The 2021 Final Rule also updated rules for immunization services. CMS is maintaining payment rates for immunization administration services described by CPT codes 90460, 90461, 90471, 90472, 90473, and 90474, and HCPCS codes G0008, G0009, and G0010 at their CY 2019 payment levels, in consideration of payment stability for stakeholders, public health concerns, and the importance of these services for Medicare beneficiaries.
It’s going to be a busy time to ready your practice for all the coming changes. Due to the fluidity of the CMS updates, make sure you are on high alert to get your timely updates, and continue to follow ICD10monitor.com and Talk Ten Tuesdays for live broadcast on healthcare industry news.
Programming Note: Listen to Terry Fletcher report this story live during Talk Ten Tuesdays today at 10 a.m. Eastern.