CMS finalizes physician fee schedule, including controversial updates to E/M visits

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The Centers for Medicare & Medicaid Services has finalized its annual physician fee schedule. (Getty/utah778)

The Trump administration has finalized the annual regulation governing physician payments, and in the rule approved payment adjustments to evaluation and management visits that drew ire from docs.

The changes to E/M visits would boost payments for these services, with the goal of empowering physicians to intervene more quickly to catch complex conditions and better manage patients' health, Centers for Medicare & Medicaid Services (CMS) Administrator Seema Verma said on a call with reporters Tuesday.

"These payment increases … support clinicians who manage ongoing care of patients with a host of chronic diseases or patient transition between hospitals, nursing facilities and home," Verma said.

However, the physician fee schedule is required to be budget neutral, leading to decreases elsewhere, with some physician specialties facing double-digit decreases in payments for 2021. 

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When these changes were initially proposed in the summer, they drew sharp criticism from physician groups. The American Medical Association (AMA), which pushed for the payment increases for E/M visits, urged the agency to waive the budget neutrality requirement in this case.

The decreases, the group said, would represent an 11% cut to the Medicare conversion factor.

"For this reason, the AMA strongly urges Congress to waive Medicare’s budget neutrality requirement for the office visit and other payment increases. Physicians are already experiencing substantial economic hardships due to COVID-19, so these pay cuts could not come at a worse time," said AMA President Susan R. Bailey, M.D., in a statement.

Physician organizations also warned that cuts could be felt even more strongly as the COVID-19 pandemic does significant damage to their finances. Similar pushback to the final rule is likely.

In addition, the rule has added 60 more services to Medicare's telehealth list, ensuring that they're covered beyond the COVID-19 pandemic.

The agency said in an announcement that it would continue to evaluate whether to add more services in the future as well as which make the most sense to include. The rule would allow beneficiaries in rural medical facilities such as nursing homes to have continued access to emergency care, therapy and critical care.

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CMS does not have statutory authority to expand telehealth coverage beyond a rural benefit in Medicare permanently, the agency noted.

Verma said on the call with reporters that without congressional action, telehealth will "revert to a rural benefit," though the slate of covered services will be larger.

CMS is covering 144 services via telehealth as part of the COVID-19 public health emergency, and the agency has seen a significant increase in use under the pandemic. Prior to COVID-19, about 15,000 fee-for-service beneficiaries received care via telehealth per week.

Due to the pandemic, between mid-March and mid-October more than 24.5 million Medicare beneficiaries have used telehealth, nearly half of the Medicare population.

“Telehealth has long been a priority for the Trump Administration, which is why we started paying for short virtual visits in rural areas long before the pandemic struck,” said Verma in a statement. “But the pandemic accentuated just how transformative it could be, and several months in, it’s clear that the healthcare system has adapted seamlessly to a historic telehealth expansion that inaugurates a new era in healthcare delivery.”