This week in Medicare updates—11/9/2022

November 9, 2022
Medicare Insider

CY 2023 Medicare Physician Fee Schedule Final Rule

On November 1, CMS published a draft copy of the CY 2023 Medicare Physician Fee Schedule Final Rule. The rule finalized a decrease in the conversion factor down from $34.61 in 2022 to $33.06 in 2023 (two cents less than the $33.08 listed in the proposed rule). Other policies finalized in the rule include:

  • Adopting coding/documentation changes for E/M visits (including hospital inpatient, observation, emergency department, and more) that align with changes made by the AMA CPT Editorial Panel for January 1, 2023. This includes eliminated use of history and exam to determine code level, revised interpretive guidelines for levels of medical decision-making, and the choice of medical decision-making or time in determining code level.
  • Delaying the split-shared visits policy until CY 2024. This policy will change the definition of the substantive portion as more than half the total time.
  • Extending the time that telehealth services are temporarily included on the telehealth services list during the PHE but are not included on a Category I, II, or III basis for 151 days following the end of the PHE. Providers should continue to report telehealth services with modifier 95 during the PHE, but audio-only services should be reported with modifier 93 effective January 1, 2023.
  • Making an exception to direct supervision requirements under “incident to” regulations at 42 CFR 410.26 allowing behavioral health services provided under general supervision of a physician or non-physician practitioner (NPP) when the services or supplies are provided by auxiliary personnel incident to the services of a physician or NPP.
  • Codifying the reporting of modifier JW for reporting wastage for all separately payable drugs with wastage from single use vials or single use packages effective January 1, 2023, and the reporting of modifier JZ for reporting single use vials or packages with no discarded amount effective July 1, 2023, with editing beginning October 1, 2023.  Other issues were clarified in commentary.
  • Codifying changes to coverage of certain dental care inextricably linked to and substantially related and integral to the clinical success of covered medical services. 

CMS published a Press Release, Fact Sheet on the PFS rule as whole, Fact Sheet on the Quality Payment Program changes, Fact Sheet on Medicare Shared Savings Program Changes, and a Blog Post on behavioral health changes on the same date.

The rule is effective January 1, 2023. 


CY 2023 Outpatient Prospective Payment System (OPPS) Final Rule

On November 1, CMS published a draft copy of the CY 2023 OPPS Final Rule. The rule finalizes updates to both OPPS and ASC PPS payment rates by 3.8% for 2023, significantly higher than the proposed 2.7% increase in payment rates. 

The rule also discusses the status of the 340B drug payment policy in light of the Supreme Court’s decision in American Hospital Association v. Becerra, which ruled that CMS’ previous payment rate of ASP minus 22.5% was unlawful. On September 28, the District Court for the District of Columbia vacated the portion of the 340B reimbursement rate remaining for 2022, but it has yet to rule on a second motion asking for remedy for the reduced payment amounts to the 340B hospitals from 2018-2022. CMS therefore started paying for 340B drugs at ASP plus 6% effective September 28, 2022, and it will continue that payment rate for CY 2023. In order to achieve budget neutrality for CY 2023 due to this payment rate, CMS is implementing a -3.09% reduction to payment rates for non-drug services. CMS stated in the final rule that it is working on a separate proposed rule to address the remedy for 340B payments from CY 2018-2022 and hopes to publish that in advance of the CY 2024 OPPS proposed rule. Providers should continue to use the JG and TB modifiers so CMS can track utilization of these drugs. The modifiers will no longer trigger payment changes.  

Other policies finalized in the rule include:

  • Removing 11 services from the inpatient-only list, adding eight services to the inpatient-only list, and adding four services to the ambulatory surgical center (ASC) covered procedures list
  • Continuing coverage for behavioral health services furnished remotely by hospital staff to beneficiaries in their homes beyond the end of the public health emergency (PHE) as long as the beneficiary receives an in-person service within six months prior to the first remote service and once every 12 months following that. 
  • Adding facet joint injections and nerve destruction as an additional service that would require prior authorization, effective July 1, 2023,  rather than the proposed date of March .
  • Approving four of the eight applications for device pass-through payments for CY 2023.
  • Finalizing changes to the supervision requirements for diagnostic services to allow non-physician practitioners to supervise diagnostic services within their scope of practice, similar to services provided under the Physician Fee Schedule.

CMS is implementing a requirement from the Consolidated Appropriations Act of 2021 to establish rural emergency hospitals (REH) as a new provider type. Critical access hospitals (CAH) and certain rural hospitals may choose to convert to an REH and would be allowed to provide emergency department services, observation care, and certain outpatient medical and health services. 

CMS published a Fact Sheet on the rule, Fact Sheet on the REH provisions, and Press Release to accompany the rule. The regulations are effective January 1, 2023. 


Extension: Policy and Technical Changes to the Medicare Advantage, Medicare Prescription Drug Benefit, PACE, Medicaid FFS, and Medicaid Managed Care Programs for Years 2020 and 2021

On November 1, CMS published an Extension Notice in the Federal Register to note that it is extending the timeline for publishing the “Medicare and Medicaid Programs; Policy and Technical Changes to the Medicare Advantage, Medicare Prescription Drug Benefit, Program of All-inclusive Care for the Elderly (PACE), Medicaid FFS, and Medicaid Managed Care Programs for Years 2020 and 2021” final rule. The rule was supposed to be published by November 1, 2021, but was extended by a year last year due to the amount of comments on Medicare Advantage Risk Adjustment Data Validation (RADV) proposed provisions and the delays caused by the COVID-19 PHE. CMS is now extending the deadline for publication of the final rule by another three months due to the continuing need to focus attention on the COVID-19 PHE. 

Dates: The timeline for publication of a rule to finalize the November 1, 2018 proposed rule is extended until February 1, 2023.


New Codes to Report Home Health Services Furnished by Telehealth

On November 2, CMS published Medicare Claims Processing Transmittal 11502 regarding three new G-codes for reporting home health services furnished by telehealth: G0320, G0321, and G0322. Providers may start reporting these codes voluntarily on January 1, 2023. Reporting the codes will be mandatory starting July 1, 2023. The transmittal also includes revisions to original Medicare systems to process these claims without affecting payment to the home health agency. 

CMS published MLN Matters 12805 on the same date to accompany the transmittal. 

Effective date: January 1, 2023

Implementation date: January 3, 2023


Medicare Provider Compliance Tips

On November 3, CMS revised a Website with provider compliance tips to add in the latest improper payment rates, denial reasons, and code changes. CMS also added information to sections on diabetic supplies, inpatient rehabilitation services, nebulizers, and oxygen.


Update to the Federally Qualified Health Center (FQHC) Prospective Payment System (PPS) for CY 2023

On November 4, CMS published Medicare Claims Processing Transmittal 11677 regarding updates to the FQHC PPS and the geographic adjustment factors (GAF) for the FQHC pricer. The FQHC base payment rate for CY 2023 is $187.19.

Effective date: January 1, 2023

Implementation date: January 3, 2023


ICD-10 and Other Coding Revisions to NCDs–April 2023 Update

On November 4, CMS published One-Time Notification Transmittal 11676 regarding the regular quarterly updates to ICD-10 conversions and other coding updates for NCDs. The NCDs affected by this round of updates include NCD 20.4 and NCD 210.10. 

Effective date: April 1, 2023 - or as noted in individual business requirements

Implementation date: April 3, 2023


Seventh General Update to Provider Enrollment Instructions in Chapter 10 of Program Integrity Manual

On November 4, CMS published Medicare Program Integrity Transmittal 11682 regarding updates to Chapter 10 of the Program Integrity Manual to update provider enrollment instructions regarding ownership disclosures, electronic funds transfers, special payment addresses, and more. 

Effective date: December 5, 2022

Implementation date: December 5, 2022


Corrections: FY 2023 IPPS Final Rule

On November 4, CMS published a Correction Notice in the Federal Register regarding corrections for typos and technical errors in the FY 2023 IPPS Final Rule, which was published August 10. Some of these corrections include updates to the calculation of Factor 3 of the uncompensated care payment methodology to reflect updated information on hospital mergers, corrections to the estimated capital outlier percentage, various typos in citations, and more. 

Important payment factors that changed include:

  • The max add-on for DefenCath was corrected from $4387.50 to $14,259.38. 
  • The Fixed Loss Threshold was corrected from $38,859 to $38,788. 
  • The capital standard amount in Table 1D was corrected from $483.76 to $483.79.

Effective date: The final rule corrections and correcting amendment are effective on November 3, 2022.

Applicability date: The final rule corrections and correcting amendment are applicable for discharges occurring on or after October 1, 2022.