CMS finalizes physician fee schedule rule with cuts to physical therapists, psychologists

Stethoscope on top of five, ten, and twenty dollar bills.
CMS has finalized the physician fee schedule for 2020 that includes cuts to physical therapists. Image: Getty Images/PLG

The Trump administration finalized a new payment rule for physicians that will cut payments to physical therapists and psychologists in 2021 and also clarifies changes for evaluation and management coding.

The Centers for Medicare & Medicaid Services released the final rule on Friday for the physician fee schedule for 2020. The rule didn’t have any major changes from the proposal released back in July.

RELATED: Physicians overestimate time that translates to their Medicare payments: study finds

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The agency decided to go forward with a proposal to align the evaluation and management coding with changes proposed by a panel. Several changes include revising the times and medical decision-making process for all of the E/M codes and require performance of history and exam only when medically appropriate.

A physician would also be able to choose the E/M visit level based on either medical decision making or time, according to a fact sheet CMS released on the proposed rule.

CMS Administrator Seema Verma told reporters during a call on Friday that the agency collaborated with the American Medical Association on the E/M changes.

CMS had proposed back in 2018 to collapse the five levels of coding for established patients and for the change to go into effect in 2021. But CMS will reduce the number of levels to four for office/outpatient visits for new patients and revise several code definitions.

RELATED: CMS wanted comments. It got close to 29K, including a flood coming from physical therapists and psychologists

The rule keeps intact controversial proposed cuts to physical therapists, psychologists and social workers.

The final rule cuts payments to physical therapists by 8% starting in 2021. The cut drew ire from several commenters who said that profit margins are already low and the cuts will force providers to close.

The rule also cuts payments for psychologists and social workers by 7% in 2021.

Verma told reporters that the cuts are preliminary and not based on the latest data.

She added that CMS is revising supervision requirements for physician assistants to defer to state law for determining the supervision level. 

In 2020, the physician fee schedule conversion factor will increase to $36.09, a $0.05 increase from the 2019 fee schedule conversion factor.

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