Medicare and Medicaid Programs; CY 2024 Payment Policies Under the Physician Fee Schedule and Other Changes to Part B Payment and Coverage Policies; Medicare Shared Savings Program Requirements; Medicare Advantage; Medicare and Medicaid Provider and Supplier Enrollment Policies; and Basic Health Program

DEPARTMENT OF HEALTH AND HUMAN SERVICES

Centers for Medicare & Medicaid Services

42 CFR Parts 405, 410, 411, 414, 415, 418, 422, 423, 424, 425, 455, 489, 491, 495, 498, and 600

[CMS-1784-P]

RIN 0938-AV07

Medicare and Medicaid Programs; CY 2024 Payment Policies Under the Physician Fee Schedule and Other Changes to Part B Payment and Coverage Policies; Medicare Shared Savings Program Requirements; Medicare Advantage; Medicare and Medicaid Provider and Supplier Enrollment Policies; and Basic Health Program

AGENCY:

Centers for Medicare & Medicaid Services (CMS), Health and Human Services (HHS).

ACTION:

Proposed rule.

SUMMARY:

This major proposed rule addresses: changes to the physician fee schedule (PFS); other changes to Medicare Part B payment policies to ensure that payment systems are updated to reflect changes in medical practice, relative value of services, and changes in the statute; payment for dental services inextricably linked to specific covered medical services; Medicare Shared Savings Program requirements; updates to the Quality Payment Program; Medicare coverage of opioid use disorder services furnished by opioid treatment programs; updates to certain Medicare and Medicaid provider and supplier enrollment policies, electronic prescribing for controlled substances for a covered Part D drug under a prescription drug plan or an MA-PD plan under the Substance Use-Disorder Prevention that Promotes Opioid Recovery and Treatment for Patients and Communities Act (SUPPORT Act); updates to the Ambulance Fee Schedule regulations and the Medicare Ground Ambulance Data Collection System; codification of the Inflation Reduction Act and Consolidated Appropriations Act, 2023 provisions; expansion of the diabetes screening and diabetes definitions; pulmonary rehabilitation, cardiac rehabilitation and intensive cardiac rehabilitation expansion of supervising practitioners; appropriate use criteria for advanced diagnostic imaging; early release of Medicare Advantage risk adjustment data; a social determinants of health risk assessment in the annual wellness visit and Basic Health Program.

DATES:

To be assured consideration, comments must be received at one of the addresses provided below, no later than 5 p.m. on September 11, 2023.

ADDRESSES:

In commenting, please refer to file code CMS-1784-P.

Comments, including mass comment submissions, must be submitted in one of the following three ways (please choose only one of the ways listed):

1.

Electronically.

You may submit electronic comments on this regulation to

http://www.regulations.gov

. Follow the “Submit a comment” instructions.

2.

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-1784-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.

3.

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-1784-P, Mail Stop C4-26-05, 7500 Security Boulevard, Baltimore, MD 21244-1850.

FOR FURTHER INFORMATION CONTACT:

MedicarePhysicianFeeSchedule@cms.hhs.gov

, for any issues not identified below. Please indicate the specific issue in the subject line of the email.

Michael Soracoe, (410) 786-6312, and Morgan Kitzmiller, (410) 786-1623, for issues related to practice expense, work RVUs, conversion factor, and PFS specialty-specific impacts.

Kris Corwin, (410) 786-8864, for issues related to the comment solicitation on strategies for updates to practice expense data collection and methodology.

MedicarePhysicianFeeSchedule@cms.hhs.gov

, for issues related to caregiver training services, community health integration services, social determinants of health risk assessment, and principal illness navigation services.

Larry Chan, (410) 786-6864, for issues related to potentially misvalued services under the PFS.

Kris Corwin, (410) 786-8864, Patrick Sartini, (410) 786-9252, and Larry Chan, (410) 786-6864, for issues related to direct supervision using two-way audio/video communication technology, telehealth, and other services involving communications technology.

Tamika Brock, (312) 886-7904, for issues related to teaching physician services.

Lindsey Baldwin, (410) 786-1694, Regina Walker-Wren, (410) 786-9160, Erick Carrera, (410) 786-8949, or

MedicarePhysicianFeeSchedule@cms.hhs.gov,

for issues related to advancing access to behavioral health.

MedicarePhysicianFeeSchedule@cms.hhs.gov,

for issues related to PFS payment for evaluation and management services.

Morgan Kitzmiller, (410) 786-1623, for issues related to geographic practice cost indices (GPCIs).

Zehra Hussain, (214) 767-4463, or

MedicarePhysicianFeeSchedule@cms.hhs.gov,

for issues related to payment of skin substitutes.

Pamela West, (410) 786-2302, for issues related to supervision of outpatient therapy services, KX modifier thresholds, diabetes self-management training (DSMT) services, and DSMT telehealth services.

Laura Ashbaugh, (410) 786-1113, and Erick Carrera, (410) 786-8949, Zehra Hussain, (214) 767-4463, or

MedicarePhysicianFeeSchedule@cms.hhs.gov,

for issues related to dental services inextricably linked to specific covered medical services.

Laura Kennedy, (410) 786-3377, Adam Brooks, (202) 205-0671, and Rachel Radzyner, (410) 786-8215, for issues related to Drugs and Biological Products Paid Under Medicare Part B.

MedicarePhysicianFeeSchedule@cms.hhs.gov,

for issues related to complex drug administration.

Laura Ashbaugh, (410) 786-1113, Ariana Pitcher,

ariana.pitcher@cms.hhs.gov,

Rasheeda Arthur, (410) 786-3434, or

CLFS_Inquiries@cms.hhs.gov

for issues related to Clinical Laboratory Fee Schedule.

Lisa Parker, (410) 786-4949, or

FQHC-PPS@cms.hhs.gov,

for issues related to FQHC payments.

Michele Franklin, (410) 786-9226, or

RHC@cms.hhs.gov,

for issues related to RHC and FQHC Conditions for Certification or Coverage.

Kianna Banks (410) 786-3498 and Cara Meyer (667) 290-9856, for issues related to RHCs and FQHCs definitions of staff.

Sarah Fulton, (410) 786-2749, for issues related to pulmonary rehabilitation, cardiac rehabilitation and intensive cardiac rehabilitation expansion of supervising practitioners.

Lindsey Baldwin, (410) 786-1694, Ariana Pitcher,

ariana.pitcher@cms.hhs.gov,

or

OTP_Medicare@cms.hhs.gov,

for issues related to Medicare coverage of opioid use

disorder treatment services furnished by opioid treatment programs.

Sabrina Ahmed, (410) 786-7499, or

SharedSavingsProgram@cms.hhs.gov,

for issues related to the Medicare Shared Savings Program (Shared Savings Program) Quality performance standard and quality reporting requirements.

Janae James, (410) 786-0801, or Elizabeth November, (410) 786-4518, or

SharedSavingsProgram@cms.hhs.gov,

for issues related to Shared Savings Program beneficiary assignment and benchmarking methodology.

Lucy Bertocci, (667) 290-8833, or

SharedSavingsProgram@cms.hhs.gov,

for inquiries related to Shared Savings Program advance investment payments, and eligibility requirements.

Rachel Radzyner, (410) 786-8215, and Michelle Cruse, (443) 478-6390, for issues related to preventive vaccine administration services.

Mollie Howerton (410) 786-5395, for issues related to Medicare Diabetes Prevention Program.

Sarah Fulton (410) 786-2749, for issues related to appropriate use criteria for advanced diagnostic imaging.

Frank Whelan, (410) 786-1302, for issues related to Medicare and Medicaid provider and supplier enrollment regulation updates.

Daniel Feller (410) 786-6913 for issues related to expanding diabetes screening and definitions.

Daniel Feller (410) 786-6913 for issues related to a social determinants of health risk assessment in the annual wellness visit.

Mei Zhang, (410) 786-7837, and Kimberly Go, (410) 786-4560, for issues related to requirement for electronic prescribing for controlled substances for a covered Part D drug under a prescription drug plan or an MA-PD plan (section 2003 of the SUPPORT Act).

Amy Gruber, (410) 786-1542, or

AmbulanceDataCollection@cms.hhs.gov,

for issues related to the Ambulance Fee Schedule (AFS) and the Medicare Ground Ambulance Data Collection System.

Mary Rossi-Coajou (410) 786-6051, for issues related to hospice Conditions of Participation.

Cameron Ingram (410) 409-8023 for issues related to Histopathology, Cytology, and Clinical Cytogenetics Regulations under CLIA of 1988.

Meg Barry (410) 786-1536, for issues related to the Basic Health Program (BHP) provisions.

Renee O'Neill, (410) 786-8821, or Sophia Sugumar, (410) 786-1648, for inquiries related to Merit-based Incentive Payment System (MIPS).

Richard Jensen, (410) 786-6126, for inquiries related to Alternative Payment Models (APMs).

SUPPLEMENTARY INFORMATION:

Inspection of Public Comments:

All comments received before the close of the comment period are available for viewing by the public, including any personally identifiable or confidential business information that is included in a comment. We post all comments received before the close of the comment period on the following website as soon as possible after they have been received:

http://www.regulations.gov

. Follow the search instructions on that website to view public comments. CMS will not post on

Regulations.gov

public comments that make threats to individuals or institutions or suggest that the commenter will take actions to harm an individual. CMS continues to encourage individuals not to submit duplicative comments. We will post acceptable comments from multiple unique commenters even if the content is identical or nearly identical to other comments.

Addenda Available Only Through the Internet on the CMS Website:

The PFS Addenda along with other supporting documents and tables referenced in this proposed rule are available on the CMS website at

https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PhysicianFeeSched/index.html

. Click on the link on the left side of the screen titled, “PFS Federal Regulations Notices” for a chronological list of PFS

Federal Register

and other related documents. For the CY 2024 PFS proposed rule, refer to item CMS-1784-P. Readers with questions related to accessing any of the Addenda or other supporting documents referenced in this proposed rule and posted on the CMS website identified above should contact

MedicarePhysicianFeeSchedule@cms.hhs.gov

.

CPT (Current Procedural Terminology) Copyright Notice:

Throughout this proposed rule, we use CPT codes and descriptions to refer to a variety of services. We note that CPT codes and descriptions are copyright 2020 American Medical Association. All Rights Reserved. CPT is a registered trademark of the American Medical Association (AMA). Applicable Federal Acquisition Regulations (FAR) and Defense Federal Acquisition Regulations (DFAR) apply.

I. Executive Summary

This major annual rule proposes to revise payment polices under the Medicare PFS and makes other policy changes, including proposals to implement certain provisions of the Consolidated Appropriations Act, 2023 (Pub. L. 117-328, September 29, 2022), Inflation Reduction Act of 2022 (IRA) (Pub. L. 117-169, August 16, 2022), Consolidated Appropriations Act, 2022 (Pub. L. 117-103, March 15, 2022), Consolidated Appropriations Act, 2021 (CAA, 2021) (Pub. L. 116-260, December 27, 2020), Bipartisan Budget Act of 2018 (BBA of 2018) (Pub. L. 115-123, February 9, 2018) and the Substance Use-Disorder Prevention that Promotes Opioid Recovery and Treatment for Patients and Communities Act (SUPPORT Act) (Pub. L. 115-271, October 24, 2018), related to Medicare Part B payment. In addition, this major proposed rule includes proposals regarding other Medicare payment policies described in sections III. and IV. of this proposed rule.

This rulemaking proposes to update the Rural Health Clinic (RHC) and Federally Qualified Health Clinic (FQHC) Conditions for Certification and Conditions for Coverage (CfCs), respectively, to implement the provisions of the Consolidated Appropriations Act (CAA), 2023 (Pub. L. 117-328, December 29, 2022), now allowing payment under Medicare Part B for services furnished by a Marriage and Family Therapist (MFT) or Mental Health Counselor (MHC).

This rulemaking would also update the Hospice Conditions of Participation (CoPs) to implement division FF, section 4121 of the CAA 2023 regarding the addition of marriage and family therapists (MFTs) or mental health counselors (MHCs) as part of the hospice interdisciplinary team and would make changes to the hospice personnel requirements. This rulemaking would also seek to further advance Medicare's overall value-based care strategy of growth, alignment, and equity through the Medicare Shared Savings Program (MSSP) and the Quality Payment Program (QPP). The structure of the programs enables us to develop a set of tools for measuring and encouraging improvements in care, which may support a shift to clinician payment over time into Advanced Alternative Payment Models (APMs) and accountable care arrangements which reduce care fragmentation and unnecessary costs for patients and the health system.

This rulemaking would also update the Ambulance Fee Schedule regulations to implement division FF, section 4103 of the CAA 2023 regarding the ground ambulance extenders provisions and would also provide further changes and clarifications to the

Medicare Ground Ambulance Data Collection System.

This rulemaking would also update Medicare and Medicaid provider and supplier enrollment regulations.

B. Summary of the Major Provisions

The statute requires us to establish payments under the PFS, based on national uniform relative value units (RVUs) that account for the relative resources used in furnishing a service. The statute requires that RVUs be established for three categories of resources: work, practice expense (PE), and malpractice (MP) expense. In addition, the statute requires that each year we establish, by regulation, the payment amounts for physicians' services paid under the PFS, including geographic adjustments to reflect the variations in the costs of furnishing services in different geographic areas.

The statute requires us to establish payments under the PFS, based on national uniform relative value units (RVUs) that account for the relative resources used in furnishing a service. The statute requires that RVUs be established for three categories of resources: work, practice expense (PE), and malpractice (MP) expense. In addition, the statute requires that we establish each year by regulation the payment amounts for physicians' services paid under the PFS, including geographic adjustments to reflect the variations in the costs of furnishing services in different geographic areas.

In this major proposed rule, we are proposing to establish RVUs for CY 2024 for the PFS to ensure that our payment systems are updated to reflect changes in medical practice and the relative value of services, as well as changes in the statute. This proposed rule also includes discussions and provisions regarding several other Medicare Part B payment policies, Medicare and Medicaid provider and supplier enrollment policies, and other policies regarding programs administered by CMS.

Specifically, this proposed rule addresses:

• Background (section II.A.)

• Determination of PE RVUs (section II.B.)

• Potentially Misvalued Services Under the PFS (section II.C.)

• Payment for Medicare Telehealth Services Under Section 1834(m) of the Social Security Act (the Act) (section II.D.)

• Valuation of Specific Codes (section II.E.)

• Evaluation and Management (E/M) Visits (section II.F.)

• Geographic Practice Cost Indices (GPCI) (section II.G.)

• Payment for Skin Substitutes (section II.H.)

• Supervision of Outpatient Therapy Services, KX Modifier Thresholds, Diabetes Self-Management Training (DSMT) Services by Registered Dietitians and Nutrition Professional, and DSMT Telehealth Services (section II.I.)

• Advancing Access to Behavioral Health (section II.J.)

• Proposals on Medicare Parts A and B Payment for Dental Services Inextricably Linked to Specific Covered Medical Services (section II.K.)

• Drugs and Biological Products Paid Under Medicare Part B (section III.A.)

• Rural Health Clinics (RHCs) and Federally Qualified Health Centers (FQHCs) (section III.B.)

• Rural Health Clinics (RHCs) and Federally Qualified Health Centers (FQHCs) Conditions for Certification or Coverage (CfCs) (section III.C.)

• Clinical Laboratory Fee Schedule: Revised Data Reporting Period and Phase-in of Payment Reductions (section III.D.)

• Pulmonary Rehabilitation, Cardiac Rehabilitation and Intensive Cardiac Rehabilitation Expansion of Supervising Practitioners (section III.E.)

• Modifications Related to Medicare Coverage for Opioid Use Disorder (OUD) Treatment Services Furnished by Opioid Treatment Programs (OTPs) (section III.F.)

• Medicare Shared Savings Program (section III.G.)

• Medicare Part B Payment for Preventive Vaccine Administration Services (section III.H.)

• Medicare Diabetes Prevention Program Expanded Model (section III.I.)

• Appropriate Use Criteria for Advanced Diagnostic Imaging (section III.J.)

• Medicare and Medicaid Provider and Supplier Enrollment (section III.K.)

• Expand Diabetes Screening and Diabetes Definitions (section III.L.)

• Requirement for Electronic Prescribing for Controlled Substances for a Covered Part D Drug under a Prescription Drug Plan or an MA-PD Plan (section 2003 of the SUPPORT Act) (section III.M.)

• Proposed Changes to the Regulations Associated with the Ambulance Fee Schedule and the Medicare Ground Ambulance Data Collection System (GADCS) (section III.N.)

• Hospice: Changes to the Hospice Conditions of Participation (section III.O.)

• RFI: Histopathology, Cytology, and Clinical Cytogenetics Regulations under the Clinical Laboratory Improvement Amendments (CLIA) of 1988 (section III.P.)

• Changes to the Basic Health Program Regulations (section III.Q.)

• Updates to the Definitions of Certified Electronic Health Record Technology (section III.R.)

• A Social Determinants of Health Risk Assessment in the Annual Wellness Visit (section III.S.)

• Updates to the Quality Payment Program (section IV.)

• Collection of Information Requirements (section V.)

• Response to Comments (section VI.)

• Regulatory Impact Analysis (section VII.)

3. Summary of Costs and Benefits

We have determined that this proposed rule is economically significant. For a detailed discussion of the economic impacts, see section VII., Regulatory Impact Analysis, of this proposed rule.

II. Provisions of the Proposed Rule for the PFS

A. Background

In accordance with section 1848 of the Act, CMS has paid for physicians' services under the Medicare physician fee schedule (PFS) since January 1, 1992. The PFS relies on national relative values that are established for work, practice expense (PE), and malpractice (MP), which are adjusted for geographic cost variations. These values are multiplied by a conversion factor (CF) to convert the relative value units (RVUs) into payment rates. The concepts and methodology underlying the PFS were enacted as part of the Omnibus Budget Reconciliation Act of 1989 (OBRA '89) (Pub. L. 101-239, December 19, 1989), and the Omnibus Budget Reconciliation Act of 1990 (OBRA '90) (Pub. L. 101-508, November 5, 1990). The final rule published in the November 25, 1991

Federal Register

(56 FR 59502) set forth the first fee schedule used for Medicare payment for physicians' services.

We note that throughout this proposed rule, unless otherwise noted, the term “practitioner” is used to describe both physicians and nonphysician practitioners (NPPs) who are permitted to bill Medicare under the PFS for the services they furnish to Medicare beneficiaries.

B. Determination of PE RVUs

1. Overview

Practice expense (PE) is the portion of the resources used in furnishing a

service that reflects the general categories of physician and practitioner expenses, such as office rent and personnel wages, but excluding malpractice (MP) expenses, as specified in section 1848(c)(1)(B) of the Act. As required by section 1848(c)(2)(C)(ii) of the Act, we use a resource-based system for determining PE RVUs for each physicians' service. We develop PE RVUs by considering the direct and indirect practice resources involved in furnishing each service. Direct expense categories include clinical labor, medical supplies, and medical equipment. Indirect expenses include administrative labor, office expense, and all other expenses. The sections that follow provide more detailed information about the methodology for translating the resources involved in furnishing each service into service specific PE RVUs. We refer readers to the CY 2010 Physician Fee Schedule (PFS) final rule with comment period (74 FR 61743 through 61748) for a more detailed explanation of the PE methodology.

2. Practice Expense Methodology

a. Direct Practice Expense

We determine the direct PE for a specific service by adding the costs of the direct resources (that is, the clinical staff, medical supplies, and medical equipment) typically involved with furnishing that service. The costs of the resources are calculated using the refined direct PE inputs assigned to each CPT code in our PE database, which are generally based on our review of recommendations received from the Relative Value Scale Update Committee (RUC) and those provided in response to public comment periods. For a detailed explanation of the direct PE methodology, including examples, we refer readers to the 5-year review of work RVUs under the PFS and proposed changes to the PE methodology in the CY 2007 PFS proposed rule (71 FR 37242) and the CY 2007 PFS final rule with comment period (71 FR 69629).

b. Indirect Practice Expense per Hour Data

We use survey data on indirect PEs incurred per hour worked, in developing the indirect portion of the PE RVUs. Prior to CY 2010, we primarily used the PE/HR by specialty that was obtained from the AMA's Socioeconomic Monitoring System (SMS). The AMA administered a new survey in CY 2007 and CY 2008, the Physician Practice Information Survey (PPIS). The PPIS is a multispecialty, nationally representative, PE survey of both physicians and NPPs paid under the PFS using a survey instrument and methods highly consistent with those used for the SMS and the supplemental surveys. The PPIS gathered information from 3,656 respondents across 51 physician specialty and health care professional groups. We believe the PPIS is the most comprehensive source of PE survey information available. We used the PPIS data to update the PE/HR data for the CY 2010 PFS for almost all of the Medicare recognized specialties that participated in the survey.

When we began using the PPIS data in CY 2010, we did not change the PE RVU methodology itself or the manner in which the PE/HR data are used in that methodology. We only updated the PE/HR data based on the new survey. Furthermore, as we explained in the CY 2010 PFS final rule with comment period (74 FR 61751), because of the magnitude of payment reductions for some specialties resulting from the use of the PPIS data, we transitioned its use over a 4-year period from the previous PE RVUs to the PE RVUs developed using the new PPIS data. As provided in the CY 2010 PFS final rule with comment period (74 FR 61751), the transition to the PPIS data was complete for CY 2013. Therefore, PE RVUs from CY 2013 forward are developed based entirely on the PPIS data, except as noted in this section.

Section 1848(c)(2)(H)(i) of the Act requires us to use the medical oncology supplemental survey data submitted in 2003 for oncology drug administration services. Therefore, the PE/HR for medical oncology, hematology, and hematology/oncology reflects the continued use of these supplemental survey data.

Supplemental survey data on independent labs from the College of American Pathologists were implemented for payments beginning in CY 2005. Supplemental survey data from the National Coalition of Quality Diagnostic Imaging Services (NCQDIS), representing independent diagnostic testing facilities (IDTFs), were blended with supplementary survey data from the American College of Radiology (ACR) and implemented for payments beginning in CY 2007. Neither IDTFs, nor independent labs, participated in the PPIS. Therefore, we continue to use the PE/HR that was developed from their supplemental survey data.

Consistent with our past practice, the previous indirect PE/HR values from the supplemental surveys for these specialties were updated to CY 2006 using the Medicare Economic Index (MEI) to put them on a comparable basis with the PPIS data.

We also do not use the PPIS data for reproductive endocrinology and spine surgery since these specialties currently are not separately recognized by Medicare, nor do we have a method to blend the PPIS data with Medicare recognized specialty data.

Previously, we established PE/HR values for various specialties without SMS or supplemental survey data by cross-walking them to other similar specialties to estimate a proxy PE/HR. For specialties that were part of the PPIS for which we previously used a cross-walked PE/HR, we instead used the PPIS based PE/HR. We use cross-walks for specialties that did not participate in the PPIS. These cross-walks have been generally established through notice and comment rulemaking and are available in the file titled “CY 2024 PFS proposed rule PE/HR” on the CMS website under downloads for the CY 2024 PFS proposed rule at

http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PhysicianFeeSched/PFS-Federal-Regulation-Notices.html

.

c. Allocation of PE to Services

To establish PE RVUs for specific services, it is necessary to establish the direct and indirect PE associated with each service.

(1) Direct Costs

The relative relationship between the direct cost portions of the PE RVUs for any two services is determined by the relative relationship between the sum of the direct cost resources (that is, the clinical staff, medical supplies, and medical equipment) typically involved with furnishing each of the services. The costs of these resources are calculated from the refined direct PE inputs in our PE database. For example, if one service has a direct cost sum of $400 from our PE database and another service has a direct cost sum of $200, the direct portion of the PE RVUs of the first service would be twice as much as the direct portion of the PE RVUs for the second service.

(2) Indirect Costs

We allocate the indirect costs at the code level based on the direct costs specifically associated with a code and the greater of either the clinical labor costs or the work RVUs. We also incorporate the survey data described earlier in the PE/HR discussion. The general approach to developing the indirect portion of the PE RVUs is as follows:

• For a given service, we use the direct portion of the PE RVUs calculated as previously described and the average percentage that direct costs represent of

total costs (based on survey data) across the specialties that furnish the service to determine an initial indirect allocator. That is, the initial indirect allocator is calculated so that the direct costs equal the average percentage of direct costs of those specialties furnishing the service. For example, if the direct portion of the PE RVUs for a given service is 2.00 and direct costs, on average, represent 25 percent of total costs for the specialties that furnish the service, the initial indirect allocator would be calculated so that it equals 75 percent of the total PE RVUs. Thus, in this example, the initial indirect allocator would equal 6.00, resulting in a total PE RVU of 8.00 (2.00 is 25 percent of 8.00 and 6.00 is 75 percent of 8.00).

• Next, we add the greater of the work RVUs or clinical labor portion of the direct portion of the PE RVUs to this initial indirect allocator. In our example, if this service had a work RVU of 4.00 and the clinical labor portion of the direct PE RVU was 1.50, we would add 4.00 (since the 4.00 work RVUs are greater than the 1.50 clinical labor portion) to the initial indirect allocator of 6.00 to get an indirect allocator of 10.00. In the absence of any further use of the survey data, the relative relationship between the indirect cost portions of the PE RVUs for any two services would be determined by the relative relationship between these indirect cost allocators. For example, if one service had an indirect cost allocator of 10.00 and another service had an indirect cost allocator of 5.00, the indirect portion of the PE RVUs of the first service would be twice as great as the indirect portion of the PE RVUs for the second service.

• Then, we incorporate the specialty specific indirect PE/HR data into the calculation. In our example, if, based on the survey data, the average indirect cost of the specialties furnishing the first service with an allocator of 10.00 was half of the average indirect cost of the specialties furnishing the second service with an indirect allocator of 5.00, the indirect portion of the PE RVUs of the first service would be equal to that of the second service.

(3) Facility and Nonfacility Costs

For procedures that can be furnished in a physician's office, as well as in a facility setting, where Medicare makes a separate payment to the facility for its costs in furnishing a service, we establish two PE RVUs: facility and nonfacility. The methodology for calculating PE RVUs is the same for both the facility and nonfacility RVUs, but is applied independently to yield two separate PE RVUs. In calculating the PE RVUs for services furnished in a facility, we do not include resources that would generally not be provided by physicians when furnishing the service. For this reason, the facility PE RVUs are generally lower than the nonfacility PE RVUs.

(4) Services With Technical Components and Professional Components

Diagnostic services are generally comprised of two components: a professional component (PC); and a technical component (TC). The PC and TC may be furnished independently or by different providers, or they may be furnished together as a global service. When services have separately billable PC and TC components, the payment for the global service equals the sum of the payment for the TC and PC. To achieve this, we use a weighted average of the ratio of indirect to direct costs across all the specialties that furnish the global service, TCs, and PCs; that is, we apply the same weighted average indirect percentage factor to allocate indirect expenses to the global service, PCs, and TCs for a service. (The direct PE RVUs for the TC and PC sum to the global.)

(5) PE RVU Methodology

For a more detailed description of the PE RVU methodology, we direct readers to the CY 2010 PFS final rule with comment period (74 FR 61745 through 61746). We also direct readers to the file titled “Calculation of PE RVUs under Methodology for Selected Codes” which is available on our website under downloads for the CY 2024 PFS proposed rule at

http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PhysicianFeeSched/PFS-Federal-Regulation-Notices.html

. This file contains a table that illustrates the calculation of PE RVUs as described in this proposed rule for individual codes.

(a) Setup File

First, we create a setup file for the PE methodology. The setup file contains the direct cost inputs, the utilization for each procedure code at the specialty and facility/nonfacility place of service level, and the specialty specific PE/HR data calculated from the surveys.

(b) Calculate the Direct Cost PE RVUs

Sum the costs of each direct input.

Step 1:

Sum the direct costs of the inputs for each service.

Step 2:

Calculate the aggregate pool of direct PE costs for the current year. We set the aggregate pool of PE costs equal to the product of the ratio of the current aggregate PE RVUs to current aggregate work RVUs and the projected aggregate work RVUs.

Step 3:

Calculate the aggregate pool of direct PE costs for use in ratesetting. This is the product of the aggregate direct costs for all services from Step 1 and the utilization data for that service.

Step 4:

Using the results of Step 2 and Step 3, use the CF to calculate a direct PE scaling adjustment to ensure that the aggregate pool of direct PE costs calculated in Step 3 does not vary from the aggregate pool of direct PE costs for the current year. Apply the scaling adjustment to the direct costs for each service (as calculated in Step 1).

Step 5:

Convert the results of Step 4 to an RVU scale for each service. To do this, divide the results of Step 4 by the CF. Note that the actual value of the CF used in this calculation does not influence the final direct cost PE RVUs as long as the same CF is used in Step 4 and Step 5. Different CFs would result in different direct PE scaling adjustments, but this has no effect on the final direct cost PE RVUs since changes in the CFs and changes in the associated direct scaling adjustments offset one another.

(c) Create the Indirect Cost PE RVUs

Create indirect allocators.

Step 6:

Based on the survey data, calculate direct and indirect PE percentages for each physician specialty.

Step 7:

Calculate direct and indirect PE percentages at the service level by taking a weighted average of the results of Step 6 for the specialties that furnish the service. Note that for services with TCs and PCs, the direct and indirect percentages for a given service do not vary by the PC, TC, and global service.

We generally use an average of the 3 most recent years of available Medicare claims data to determine the specialty mix assigned to each code. Codes with low Medicare service volume require special attention since billing or enrollment irregularities for a given year can result in significant changes in specialty mix assignment. We finalized a policy in the CY 2018 PFS final rule (82 FR 52982 through 52983) to use the most recent year of claims data to determine which codes are low volume for the coming year (those that have fewer than 100 allowed services in the Medicare claims data). For codes that fall into this category, instead of assigning specialty mix based on the specialties of the practitioners reporting the services in the claims data, we use the expected specialty that we identify on a list developed based on medical review and input from expert interested parties. We display this list of expected

specialty assignments as part of the annual set of data files we make available as part of notice and comment rulemaking and consider recommendations from the RUC and other interested parties on changes to this list on an annual basis. Services for which the specialty is automatically assigned based on previously finalized policies under our established methodology (for example, “always therapy” services) are unaffected by the list of expected specialty assignments. We also finalized in the CY 2018 PFS final rule (82 FR 52982 through 52983) a policy to apply these service-level overrides for both PE and MP, rather than one or the other category.

Step 8:

Calculate the service level allocators for the indirect PEs based on the percentages calculated in Step 7. The indirect PEs are allocated based on the three components: the direct PE RVUs; the clinical labor PE RVUs; and the work RVUs.

For most services the indirect allocator is: indirect PE percentage * (direct PE RVUs/direct percentage) + work RVUs.

There are two situations where this formula is modified:

• If the service is a global service (that is, a service with global, professional, and technical components), then the indirect PE allocator is: indirect percentage (direct PE RVUs/direct percentage) + clinical labor PE RVUs + work RVUs.

• If the clinical labor PE RVUs exceed the work RVUs (and the service is not a global service), then the indirect allocator is: indirect PE percentage (direct PE RVUs/direct percentage) + clinical labor PE RVUs.

(

Note:

For global services, the indirect PE allocator is based on both the work RVUs and the clinical labor PE RVUs. We do this to recognize that, for the PC service, indirect PEs would be allocated using the work RVUs, and for the TC service, indirect PEs would be allocated using the direct PE RVUs and the clinical labor PE RVUs. This also allows the global component RVUs to equal the sum of the PC and TC RVUs.)

For presentation purposes, in the examples in the download file titled “Calculation of PE RVUs under Methodology for Selected Codes”, the formulas were divided into two parts for each service.

• The first part does not vary by service and is the indirect percentage (direct PE RVUs/direct percentage).

• The second part is either the work RVU, clinical labor PE RVU, or both depending on whether the service is a global service and whether the clinical PE RVUs exceed the work RVUs (as described earlier in this step).

Apply a scaling adjustment to the indirect allocators.

Step 9:

Calculate the current aggregate pool of indirect PE RVUs by multiplying the result of step 8 by the average indirect PE percentage from the survey data.

Step 10:

Calculate an aggregate pool of indirect PE RVUs for all PFS services by adding the product of the indirect PE allocators for a service from Step 8 and the utilization data for that service.

Step 11:

Using the results of Step 9 and Step 10, calculate an indirect PE adjustment so that the aggregate indirect allocation does not exceed the available aggregate indirect PE RVUs and apply it to indirect allocators calculated in Step 8.

Calculate the indirect practice cost index.

Step 12:

Using the results of Step 11, calculate aggregate pools of specialty specific adjusted indirect PE allocators for all PFS services for a specialty by adding the product of the adjusted indirect PE allocator for each service and the utilization data for that service.

Step 13:

Using the specialty specific indirect PE/HR data, calculate specialty specific aggregate pools of indirect PE for all PFS services for that specialty by adding the product of the indirect PE/HR for the specialty, the work time for the service, and the specialty's utilization for the service across all services furnished by the specialty.

Step 14:

Using the results of Step 12 and Step 13, calculate the specialty specific indirect PE scaling factors.

Step 15:

Using the results of Step 14, calculate an indirect practice cost index at the specialty level by dividing each specialty specific indirect scaling factor by the average indirect scaling factor for the entire PFS.

Step 16:

Calculate the indirect practice cost index at the service level to ensure the capture of all indirect costs. Calculate a weighted average of the practice cost index values for the specialties that furnish the service. (Note: For services with TCs and PCs, we calculate the indirect practice cost index across the global service, PCs, and TCs. Under this method, the indirect practice cost index for a given service (for example, echocardiogram) does not vary by the PC, TC, and global service.)

Step 17:

Apply the service level indirect practice cost index calculated in Step 16 to the service level adjusted indirect allocators calculated in Step 11 to get the indirect PE RVUs.

(d) Calculate the Final PE RVUs

Step 18:

Add the direct PE RVUs from Step 5 to the indirect PE RVUs from Step 17 and apply the final PE budget neutrality (BN) adjustment. The final PE BN adjustment is calculated by comparing the sum of steps 5 and 17 to the aggregate work RVUs scaled by the ratio of current aggregate PE and work RVUs. This adjustment ensures that all PE RVUs in the PFS account for the fact that certain specialties are excluded from the calculation of PE RVUs but included in maintaining overall PFS BN. (See “Specialties excluded from ratesetting calculation” later in this proposed rule.)

Step 19:

Apply the phase-in of significant RVU reductions and its associated adjustment. Section 1848(c)(7) of the Act specifies that for services that are not new or revised codes, if the total RVUs for a service for a year would otherwise be decreased by an estimated 20 percent or more as compared to the total RVUs for the previous year, the applicable adjustments in work, PE, and MP RVUs shall be phased in over a 2-year period. In implementing the phase-in, we consider a 19 percent reduction as the maximum 1-year reduction for any service not described by a new or revised code. This approach limits the year one reduction for the service to the maximum allowed amount (that is, 19 percent), and then phases in the remainder of the reduction. To comply with section 1848(c)(7) of the Act, we adjust the PE RVUs to ensure that the total RVUs for all services that are not new or revised codes decrease by no more than 19 percent, and then apply a relativity adjustment to ensure that the total pool of aggregate PE RVUs remains relative to the pool of work and MP RVUs. For a more detailed description of the methodology for the phase-in of significant RVU changes, we refer readers to the CY 2016 PFS final rule with comment period (80 FR 70927 through 70931).

(e) Setup File Information

• Specialties excluded from ratesetting calculation: For the purposes of calculating the PE and MP RVUs, we exclude certain specialties, such as certain NPPs paid at a percentage of the PFS and low volume specialties, from the calculation. These specialties are included for the purposes of calculating the BN adjustment. They are displayed in Table 1.

EP07AU23.000

•

Cross-walk certain low volume physician specialties:

Cross-walk the utilization of certain specialties with relatively low PFS utilization to the associated specialties.

•

Physical therapy utilization:

Cross-walk the utilization associated with all physical therapy services to the specialty of physical therapy.

•

Identify professional and technical services not identified under the usual TC and 26 modifiers:

Flag the services that are PC and TC services but do not use TC and 26 modifiers (for example, electrocardiograms). This flag associates the PC and TC with the associated global code for use in creating the indirect PE RVUs. For example, the professional service, CPT code 93010 (Electrocardiogram, routine ECG with at least 12 leads; interpretation and report only), is associated with the global service, CPT code 93000 (Electrocardiogram, routine ECG with at least 12 leads; with interpretation and report).

•

Payment modifiers:

Payment modifiers are accounted for in the creation of the file consistent with current payment policy as implemented in claims processing. For example, services billed with the assistant at surgery modifier are paid 16 percent of the PFS amount for that service; therefore, the utilization file is modified to only account for 16 percent of any service that contains the assistant at surgery modifier. Similarly, for those services to which volume adjustments are made to account for the payment modifiers, time adjustments are applied as well. For time adjustments to surgical services, the intraoperative portion in the work time file is used; where it is not present, the intraoperative percentage from the payment files used by contractors to process Medicare claims is used instead. Where neither is available, we use the payment adjustment ratio to adjust the time

accordingly. Table 2 details the manner in which the modifiers are applied.

EP07AU23.001

We also adjust volume and time that correspond to other payment rules, including special multiple procedure endoscopy rules and multiple procedure payment reductions (MPPRs). We note that section 1848(c)(2)(B)(v) of the Act exempts certain reduced payments for multiple imaging procedures and multiple therapy services from the BN calculation under section 1848(c)(2)(B)(ii)(II) of the Act. These MPPRs are not included in the development of the RVUs.

Beginning in CY 2022, section 1834(v)(1) of the Act required that we apply a 15 percent payment reduction for outpatient occupational therapy services and outpatient physical therapy services that are provided, in whole or in part, by a physical therapist assistant (PTA) or occupational therapy assistant (OTA). Section 1834(v)(2)(A) of the Act required CMS to establish modifiers to identify these services, which we did in the CY 2019 PFS final rule (83 FR 59654 through 59661), creating the CQ and CO payment modifiers for services provided in whole or in part by PTAs and OTAs, respectively. These payment modifiers are required to be used on claims for services with dates of service beginning January 1, 2020, as specified in the CY 2020 PFS final rule (84 FR 62702 through 62708). We applied the 15 percent payment reduction to therapy services provided by PTAs (using the CQ modifier) or OTAs (using the CO modifier), as required by statute. Under sections 1834(k) and 1848 of the Act, payment is made for outpatient therapy services at 80 percent of the lesser of the actual charge or applicable fee schedule amount (the allowed charge). The remaining 20 percent is the beneficiary copayment. For therapy services to which the new discount applies, payment will be made at 85 percent of the 80 percent of allowed charges. Therefore, the volume discount factor for therapy services to which the CQ and CO modifiers apply is: (0.20 + (0.80* 0.85), which equals 88 percent.

For anesthesia services, we do not apply adjustments to volume since we use the average allowed charge when simulating RVUs; therefore, the RVUs as calculated already reflect the payments as adjusted by modifiers, and no volume adjustments are necessary. However, a time adjustment of 33 percent is made only for medical direction of two to four cases since that is the only situation where a single practitioner is involved with multiple beneficiaries concurrently, so that counting each service without regard to the overlap with other services would overstate the amount of time spent by the practitioner furnishing these services.

•

Work RVUs:

The setup file contains the work RVUs from this proposed rule.

(6) Equipment Cost per Minute

The equipment cost per minute is calculated as:

(1/(minutes per year * usage)) * price * ((interest rate/(1 (1/((1 + interest rate)^ life of equipment)))) + maintenance)

Where:

minutes per year = maximum minutes per year if usage were continuous (that is, usage=1); generally, 150,000 minutes

usage = variable, see discussion below in this proposed rule

price = price of the particular piece of equipment

life of equipment = useful life of the particular piece of equipment

maintenance = factor for maintenance; 0.05

interest rate = variable, see discussion below in this proposed rule

Usage:

We currently use an equipment utilization rate assumption of 50 percent for most equipment, with the exception of expensive diagnostic imaging equipment, for which we use a 90 percent assumption as required by section 1848(b)(4)(C) of the Act.

Useful Life:

In the CY 2005 PFS final rule we stated that we updated the useful life for equipment items primarily based on the AHA's “Estimated Useful Lives of Depreciable Hospital Assets” guidelines (69 FR 66246). The most recent edition of these guidelines was published in 2018. This reference material provides an estimated useful life for hundreds of different

types of equipment, the vast majority of which fall in the range of 5 to 10 years, and none of which are lower than 2 years in duration. We believe that the updated editions of this reference material remain the most accurate source for estimating the useful life of depreciable medical equipment.

In the CY 2021 PFS final rule, we finalized a proposal to treat equipment life durations of less than 1 year as having a duration of 1 year for the purpose of our equipment price per minute formula. In the rare cases where items are replaced every few months, we noted that we believe it is more accurate to treat these items as disposable supplies with a fractional supply quantity as opposed to equipment items with very short equipment life durations. For a more detailed discussion of the methodology associated with very short equipment life durations, we refer readers to the CY 2021 PFS final rule (85 FR 84482 through 84483).

•

Maintenance:

We finalized the 5 percent factor for annual maintenance in the CY 1998 PFS final rule with comment period (62 FR 33164). As we previously stated in the CY 2016 PFS final rule with comment period (80 FR 70897), we do not believe the annual maintenance factor for all equipment is precisely 5 percent, and we concur that the current rate likely understates the true cost of maintaining some equipment. We also noted that we believe it likely overstates the maintenance costs for other equipment. When we solicited comments regarding sources of data containing equipment maintenance rates, commenters were unable to identify an auditable, robust data source that could be used by CMS on a wide scale. We noted that we did not believe voluntary submissions regarding the maintenance costs of individual equipment items would be an appropriate methodology for determining costs. As a result, in the absence of publicly available datasets regarding equipment maintenance costs or another systematic data collection methodology for determining a different maintenance factor, we did not propose a variable maintenance factor for equipment cost per minute pricing as we did not believe that we have sufficient information at present. We noted that we would continue to investigate potential avenues for determining equipment maintenance costs across a broad range of equipment items.

•

Interest Rate:

In the CY 2013 PFS final rule with comment period (77 FR 68902), we updated the interest rates used in developing an equipment cost per minute calculation (see 77 FR 68902 for a thorough discussion of this issue). The interest rate was based on the Small Business Administration (SBA) maximum interest rates for different categories of loan size (equipment cost) and maturity (useful life). The Interest rates are listed in Table 3.

EP07AU23.002

We are not proposing any changes to the equipment interest rates for CY 2024.

3. Adjusting RVUs To Match the PE Share of the Medicare Economic Index (MEI)

In the past, we have stated that we believe that the MEI is the best measure available of the relative weights of the three components in payments under the PFS—work, practice expense (PE), and malpractice (MP). Accordingly, we believe that to assure that the PFS payments reflect the relative resources in each of these PFS components as required by section 1848(c)(3) of the Act, the RVUs used in developing rates should reflect the same weights in each component as the Medicare Economic Index (MEI). In the past, we have proposed (and subsequently, finalized) to accomplish this by holding the work RVUs constant and adjusting the PE RVUs, MP RVUs, and CF to produce the appropriate balance in RVUs among the three PFS components and payment rates for individual services, that is, that the total RVUs on the PFS are proportioned to approximately 51 percent work RVUs, 45 percent PE RVUs, and 4 percent MP RVUs. As the MEI cost shares are updated, we would typically propose to modify steps 3 and 10 to adjust the aggregate pools of PE costs (direct PE in step 3 and indirect PE in step 10) in proportion to the change in the PE share in the rebased and revised MEI cost share weights, and to recalibrate the relativity adjustment that we apply in step 18 as described “3. Adjusting RVUs To Match PE Share of the Medicare Economic Index (MEI)” of the CY 2023 PFS final rule (87 FR 69414 and 69415) and CY 2014 PFS final rule (78 FR 74236 and 74237). The most recent recalibration was done for the CY 2014 RVUs.

In the CY 2014 PFS proposed rule (78 FR 43287 through 43288) and final rule (78 FR 74236 through 74237), we detailed the steps necessary to accomplish this result (see steps 3, 10, and 18). The CY 2014 proposed and final adjustments were consistent with our longstanding practice to make adjustments to match the RVUs for the PFS components with the MEI cost share weights for the components, including the adjustments described in the CY 1999 PFS final rule (63 FR 58829), CY 2004 PFS final rule (68 FR 63246 and 63247), and CY 2011 PFS final rule (75 FR 73275).

In the CY 2023 PFS final rule (87 FR 69688 through 69711), we finalized to rebase and revise the Medicare Economic Index (MEI) to reflect more current market conditions faced by physicians in furnishing physicians' services. We also finalized a delay of the adjustments to the PE pools in steps 3 and 10 and the recalibration of the relativity adjustment in step 18 until the public had an opportunity to comment on the rebased and revised MEI (87 FR 69414 through 69416). Because we finalized significant methodological and data source changes to the MEI in the CY 2023 PFS final rule and significant time has elapsed since the last rebasing and revision of the MEI in CY 2014, we believed that delaying the implementation of the finalized CY

2023 rebased and revised MEI was consistent with our efforts to balance payment stability and predictability with incorporating new data through more routine updates. We refer readers to the discussion of our comment solicitation in the CY 2023 PFS final rule (87 FR 69429 through 69432), where we reviewed our ongoing efforts to update data inputs for PE to aid stability, transparency, efficiency, and data adequacy. We also solicited comment in the CY 2023 PFS proposed rule on when and how to best incorporate the CY 2023 rebased and revised MEI into PFS ratesetting, and whether it would be appropriate to consider a transition to full implementation for potential future rulemaking. We presented the impacts of implementing the rebased and revised MEI in PFS ratesetting through a 4-year transition and through full immediate implementation, that is, with no transition period in the CY 2023 PFS proposed rule. We also solicited comment on other implementation strategies for potential future rulemaking in the CY 2023 PFS proposed rule. In the CY 2023 PFS final rule, we discussed that many commenters supported our proposed delayed implementation and many commenters expressed concerns with the redistributive impacts of the implementation of the rebased and revised MEI in PFS ratesetting. Many commenters also noted that the AMA has said it intends to collect practice cost data from physician practices in the near future which could be used to derive cost share weights for the MEI and RVU shares.

In light of the AMA's intended data collection efforts in the near future and because the methodological and data source changes to the MEI finalized in the CY 2023 PFS final rule would have significant impacts on PFS payments, we continue to believe that delaying the implementation of the finalized 2017-based MEI cost weights for the RVUs is consistent with our efforts to balance payment stability and predictability with incorporating new data through more routine updates. Therefore, we are not proposing to incorporate the 2017-based MEI in PFS ratesetting for CY 2024.

As discussed above, in the CY 2023 PFS rulemaking, we finalized to rebase and revise the MEI to reflect more current market conditions faced by physicians in furnishing physicians' services. The final 2017-based MEI relies on a methodology that uses publicly available data sources for input costs that represent all types of physician practice ownership, not limited to only self-employed physicians. The 2006-based MEI relied on the 2006 AMA PPIS survey data; as of this CY 2024 rulemaking, this survey had not been updated. Given the changes in the physician and supplier industry and the time since the last update to the base year, we finalized a methodology that would allow us to update the MEI on a consistent basis in the future. The 2017-based MEI cost weights are derived predominantly from the annual expense data from the U.S. Census Bureau's Services Annual Survey (SAS,

https://www.census.gov/programs-surveys/sas.html

). We supplement the 2017 SAS expense data by using several data sources to further disaggregate compensation costs and all other residual costs (87 FR 69688 through 69708).

We continue to review more recently available data from the Census Bureau Services Annual Survey, the main data source for the major components of the 2017-based MEI weights. Data is currently available through 2021. Given that the impact of the PHE may influence the 2020 and 2021 data, we continue to evaluate whether the recent trends are reflective of sustained shifts in cost structures or were temporary as a result of the COVID-19 PHE. The 2022 data from the Services Annual Survey will be available later this year. We will monitor that data and any other data that may become available related to physician services' input expenses and will propose any changes to the MEI, if appropriate, in future rulemaking.

4. Changes to Direct PE Inputs for Specific Services

This section focuses on specific PE inputs. The direct PE inputs are included in the CY 2024 direct PE input public use files, which are available on the CMS website under downloads for the CY 2024 PFS proposed rule at

http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PhysicianFeeSched/PFS-Federal-Regulation-Notices.html.

a. Standardization of Clinical Labor Tasks

As we noted in the CY 2015 PFS final rule with comment period (79 FR 67640 through 67641), we continue to make improvements to the direct PE input database to provide the number of clinical labor minutes assigned for each task for every code in the database instead of only including the number of clinical labor minutes for the preservice, service, and post service periods for each code. In addition to increasing the transparency of the information used to set PE RVUs, this level of detail would allow us to compare clinical labor times for activities associated with services across the PFS, which we believe is important to maintaining the relativity of the direct PE inputs. This information would facilitate the identification of the usual numbers of minutes for clinical labor tasks and the identification of exceptions to the usual values. It would also allow for greater transparency and consistency in the assignment of equipment minutes based on clinical labor times. Finally, we believe that the detailed information can be useful in maintaining standard times for particular clinical labor tasks that can be applied consistently to many codes as they are valued over several years, similar in principle to the use of physician preservice time packages. We believe that setting and maintaining such standards would provide greater consistency among codes that share the same clinical labor tasks and could improve relativity of values among codes. For example, as medical practice and technologies change over time, changes in the standards could be updated simultaneously for all codes with the applicable clinical labor tasks, instead of waiting for individual codes to be reviewed.

In the CY 2016 PFS final rule with comment period (80 FR 70901), we solicited comments on the appropriate standard minutes for the clinical labor tasks associated with services that use digital technology. After consideration of comments received, we finalized standard times for clinical labor tasks associated with digital imaging at 2 minutes for “Availability of prior images confirmed”, 2 minutes for “Patient clinical information and questionnaire reviewed by technologist, order from physician confirmed and exam protocoled by radiologist”, 2 minutes for “Review examination with interpreting MD”, and 1 minute for “Exam documents scanned into PACS” and “Exam completed in RIS system to generate billing process and to populate images into Radiologist work queue.” In the CY 2017 PFS final rule (81 FR 80184 through 80186), we finalized a policy to establish a range of appropriate standard minutes for the clinical labor activity, “Technologist QCs images in PACS, checking for all images, reformats, and dose page.” These standard minutes will be applied to new and revised codes that make use of this clinical labor activity when they are reviewed by us for valuation. We finalized a policy to establish 2 minutes as the standard for the simple case, 3 minutes as the standard for the intermediate case, 4 minutes as the standard for the

complex case, and 5 minutes as the standard for the highly complex case. These values were based upon a review of the existing minutes assigned for this clinical labor activity; we determined that 2 minutes is the duration for most services and a small number of codes with more complex forms of digital imaging have higher values. We also finalized standard times for a series of clinical labor tasks associated with pathology services in the CY 2016 PFS final rule with comment period (80 FR 70902). We do not believe these activities would be dependent on number of blocks or batch size, and we believe that the finalized standard values accurately reflect the typical time it takes to perform these clinical labor tasks.

In reviewing the RUC-recommended direct PE inputs for CY 2019, we noticed that the 3 minutes of clinical labor time traditionally assigned to the “Prepare room, equipment and supplies” (CA013) clinical labor activity were split into 2 minutes for the “Prepare room, equipment and supplies” activity and 1 minute for the “Confirm order, protocol exam” (CA014) activity. We proposed to maintain the 3 minutes of clinical labor time for the “Prepare room, equipment and supplies” activity and remove the clinical labor time for the “Confirm order, protocol exam” activity wherever we observed this pattern in the RUC-recommended direct PE inputs. Commenters explained in response that when the new version of the PE worksheet introduced the activity codes for clinical labor, there was a need to translate old clinical labor tasks into the new activity codes, and that a prior clinical labor task was split into two of the new clinical labor activity codes: CA007 (

Review patient clinical extant information and questionnaire

) in the preservice period, and CA014 (

Confirm order, protocol exam

) in the service period. Commenters stated that the same clinical labor from the old PE worksheet was now divided into the CA007 and CA014 activity codes, with a standard of 1 minute for each activity. We agreed with commenters that we would finalize the RUC-recommended 2 minutes of clinical labor time for the CA007 activity code and 1 minute for the CA014 activity code in situations where this was the case. However, when reviewing the clinical labor for the reviewed codes affected by this issue, we found that several of the codes did not include this old clinical labor task, and we also noted that several of the reviewed codes that contained the CA014 clinical labor activity code did not contain any clinical labor for the CA007 activity. In these situations, we continue to believe that in these cases, the 3 total minutes of clinical staff time would be more accurately described by the CA013 “Prepare room, equipment and supplies” activity code, and we finalized these clinical labor refinements. For additional details, we direct readers to the discussion in the CY 2019 PFS final rule (83 FR 59463 and 59464).

Following the publication of the CY 2020 PFS proposed rule, one commenter expressed concern with the published list of common refinements to equipment time. The commenter stated that these refinements were the formulaic result of the applying refinements to the clinical labor time and did not constitute separate refinements; the commenter requested that CMS no longer include these refinements in the table published each year. In the CY 2020 PFS final rule, we agreed with the commenter that these equipment time refinements did not reflect errors in the equipment recommendations or policy discrepancies with the RUC's equipment time recommendations. However, we believed that it was important to publish the specific equipment times that we were proposing (or finalizing in the case of the final rule) when they differed from the recommended values due to the effect that these changes can have on the direct costs associated with equipment time. Therefore, we finalized the separation of the equipment time refinements associated with changes in clinical labor into a separate table of refinements. For additional details, we direct readers to the discussion in the CY 2020 PFS final rule (84 FR 62584).

Historically, the RUC has submitted a “PE worksheet” that details the recommended direct PE inputs for our use in developing PE RVUs. The format of the PE worksheet has varied over time and among the medical specialties developing the recommendations. These variations have made it difficult for both the RUC's development and our review of code values for individual codes. Beginning with its recommendations for CY 2019, the RUC has mandated the use of a new PE worksheet for purposes of their recommendation development process that standardizes the clinical labor tasks and assigns them a clinical labor activity code. We believe the RUC's use of the new PE worksheet in developing and submitting recommendations will help us to simplify and standardize the hundreds of different clinical labor tasks currently listed in our direct PE database. As we did in previous calendar years, to facilitate rulemaking for CY 2023, we are continuing to display two versions of the Labor Task Detail public use file: one version with the old listing of clinical labor tasks, and one with the same tasks cross-walked to the new listing of clinical labor activity codes. These lists are available on the CMS website under downloads for the CY 2024 PFS proposed rule at

http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PhysicianFeeSched/PFS-Federal-Regulation-Notices.html.

b. Updates to Prices for Existing Direct PE Inputs

In the CY 2011 PFS final rule with comment period (75 FR 73205), we finalized a process to act on public requests to update equipment and supply price and equipment useful life inputs through annual rulemaking, beginning with the CY 2012 PFS proposed rule. Beginning in CY 2019 and continuing through CY 2022, we conducted a market-based supply and equipment pricing update, using information developed by our contractor, StrategyGen, which updated pricing recommendations for approximately 1300 supplies and 750 equipment items currently used as direct PE inputs. Given the potentially significant changes in payment that would occur, in the CY 2019 PFS final rule we finalized a policy to phase in our use of the new direct PE input pricing over a 4-year period using a 25/75 percent (CY 2019), 50/50 percent (CY 2020), 75/25 percent (CY 2021), and 100/0 percent (CY 2022) split between new and old pricing. We believed that implementing the proposed updated prices with a 4-year phase-in would improve payment accuracy, while maintaining stability and allowing interested parties the opportunity to address potential concerns about changes in payment for particular items. This 4-year transition period to update supply and equipment pricing concluded in CY 2022; for a more detailed discussion, we refer readers to the CY 2019 PFS final rule with comment period (83 FR 59473 through 59480).

For CY 2024, we are proposing to update the price of 16 supplies and two equipment items in response to the public submission of invoices following the publication of the CY 2023 PFS final rule. The 16 supply and equipment items with proposed updated prices are listed in the valuation of specific codes section of the preamble under Table 14, CY 2024 Invoices Received for Existing Direct PE Inputs.

We are not proposing to update the price of another eleven supplies which were the subject of public submission of invoices. Our rationale for not updating these prices is detailed below:

• Extended external ECG patch, medical magnetic tape recorder (SD339): We received additional invoices for the SD339 supply from an interested party. Upon review of the invoices, we determined that they contained the identical price point that we previously incorporated into last year's rule when we finalized a price of $260.35 for the supply item (87 FR 69514 through 69516). Since these invoices did not contain any new information, we are maintaining the previously finalized price of $260.35 for the SD339 supply.

• Permanent marking pen (SL477), Liquid coverslip (Ventana 650-010) (SL479), EZ Prep (10X) (Ventana 950-102) (SL481), Cell Conditioning 1 (Ventana 950-124) (SL482), and Hematoxylin II (Ventana 790-2208) (SL483): We received invoices from interested parties for use in updating the price of these laboratory supplies. In each case, however, we were able to find the same supply item available for sale online at the current price or cheaper. Therefore, we do not believe that the submitted invoices represent typical market pricing for these supplies and we are not proposing to update their prices.

• Mask, surgical (SB033), scalpel with blade, surgical (#10-20) (SF033), eye shield, non-fog (SG049), gauze, non-sterile 4in x 4in (SG051), and towel, paper (Bounty) (per sheet) (SK082): We received invoices from interested parties for use in updating the price of these common supply items. In each case, we received a single invoice and once again we were able to find the same supply items available for sale online at the current price or cheaper. Generally speaking, we avoid updating the price for common supply items like the SB033 surgical mask (included in approximately 380 HCPCS codes) based on the submission of a single invoice, as an invoice unrepresentative of current market pricing will have far-reaching effects across the PFS. We did not find that the typical price for a surgical mask had increased by more than 60% since the supply and equipment pricing update concluded in CY 2022, and as such we are maintaining the current price for these supply items.

(1) Invoice Submission

We remind readers that we routinely accept public submission of invoices as part of our process for developing payment rates for new, revised, and potentially misvalued codes. Often these invoices are submitted in conjunction with the RUC-recommended values for the codes. To be included in a given year's proposed rule, we generally need to receive invoices by the same February 10th deadline we noted for consideration of RUC recommendations. However, we will consider invoices submitted as public comments during the comment period following the publication of the PFS proposed rule, and would consider any invoices received after February 10th or outside of the public comment process as part of our established annual process for requests to update supply and equipment prices. Interested parties are encouraged to submit invoices with their public comments or, if outside the notice and comment rulemaking process, via email at

PE_Price_Input_Update@cms.hhs.gov

.

c. Clinical Labor Pricing Update

Section 220(a) of the PAMA provides that the Secretary may collect or obtain information from any eligible professional or any other source on the resources directly or indirectly related to furnishing services for which payment is made under the PFS, and that such information may be used in the determination of relative values for services under the PFS. Such information may include the time involved in furnishing services; the amounts, types and prices of PE inputs; overhead and accounting information for practices of physicians and other suppliers, and any other elements that would improve the valuation of services under the PFS.

Beginning in CY 2019, we updated the supply and equipment prices used for PE as part of a market-based pricing transition; CY 2022 was the final year of this 4-year transition. We initiated a market research contract with StrategyGen to conduct an in-depth and robust market research study to update the supply and equipment pricing for CY 2019, and we finalized a policy in CY 2019 to phase in the new pricing over a period of 4 years. However, we did not propose to update the clinical labor pricing, and the pricing for clinical labor has remained unchanged during this pricing transition. Clinical labor rates were last updated for CY 2002 using Bureau of Labor Statistics (BLS) data and other supplementary sources where BLS data were not available; we refer readers to the full discussion in the CY 2002 PFS final rule for additional details (66 FR 55257 through 55262).

Interested parties raised concerns that the long delay since clinical labor pricing was last updated created a significant disparity between CMS' clinical wage data and the market average for clinical labor. In recent years, a number of interested parties suggested that certain wage rates were inadequate because they did not reflect current labor rate information. Some interested parties also stated that updating the supply and equipment pricing without updating the clinical labor pricing could create distortions in the allocation of direct PE. They argued that since the pool of aggregated direct PE inputs is budget neutral, if these rates are not routinely updated, clinical labor may become undervalued over time relative to equipment and supplies, especially since the supply and equipment prices are in the process of being updated. There was considerable interest among interested parties in updating the clinical labor rates, and when we solicited comment on this topic in past rules, such as in the CY 2019 PFS final rule (83 FR 59480), interested parties supported the idea.

Therefore, we proposed to update the clinical labor pricing for CY 2022, in conjunction with the final year of the supply and equipment pricing update (86 FR 39118 through 39123). We believed it was important to update the clinical labor pricing to maintain relativity with the recent supply and equipment pricing updates. We proposed to use the methodology outlined in the CY 2002 PFS final rule (66 FR 55257), which draws primarily from BLS wage data, to calculate updated clinical labor pricing. As we stated in the CY 2002 PFS final rule, the BLS' reputation for publishing valid estimates that are nationally representative led to the choice to use the BLS data as the main source. We believe that the BLS wage data continues to be the most accurate source to use as a basis for clinical labor pricing and this data will appropriately reflect changes in clinical labor resource inputs for purposes of setting PE RVUs under the PFS. We used the most current BLS survey data (2019) as the main source of wage data for our CY 2022 clinical labor proposal.

We recognized that the BLS survey of wage data does not cover all the staff types contained in our direct PE database. Therefore, we cross-walked or extrapolated the wages for several staff types using supplementary data sources for verification whenever possible. In situations where the price wages of clinical labor types were not referenced in the BLS data, we used the national salary data from the Salary Expert, an online project of the Economic Research Institute that surveys national and local salary ranges and averages for thousands

of job titles using mainly government sources. (A detailed explanation of the methodology used by Salary Expert to estimate specific job salaries can be found at

www.salaryexpert.com

). We previously used Salary Expert information as the primary backup source of wage data during the last update of clinical labor pricing in CY 2002. If we did not have direct BLS wage data available for a clinical labor type, we used the wage data from Salary Expert as a reference for pricing, then cross-walked these clinical labor types to a proxy BLS labor category rate that most closely matched the reference wage data, similar to the crosswalks used in our PE/HR allocation. For example, there is no direct BLS wage data for the Mammography Technologist (L043) clinical labor type; we used the wage data from Salary Expert as a reference and identified the BLS wage data for Respiratory Therapists as the best proxy category. We calculated rates for the “blend” clinical labor categories by combining the rates for each labor type in the blend and then dividing by the total number of labor types in the blend.

As in the CY 2002 clinical labor pricing update, the proposed cost per minute for each clinical staff type was derived by dividing the average hourly wage rate by 60 to arrive at the per minute cost. In cases where an hourly wage rate was not available for a clinical staff type, the proposed cost per minute for the clinical staff type was derived by dividing the annual salary (converted to 2021 dollars using the Medicare Economic Index) by 2080 (the number of hours in a typical work year) to arrive at the hourly wage rate and then again by 60 to arrive at the per minute cost. We ultimately finalized the use of median BLS wage data, as opposed to mean BLS wage data, in response to comments in the CY 2022 PFS final rule. To account for the employers' cost of providing fringe benefits, such as sick leave, we finalized the use of a benefits multiplier of 1.296 based on a BLS release from June 17, 2021 (USDL-21-1094). As an example of this process, for the Physical Therapy Aide (L023A) clinical labor type, the BLS data reflected a median hourly wage rate of $12.98, which we multiplied by the 1.296 benefits modifier and then divided by 60 minutes to arrive at the finalized per-minute rate of $0.28.

After considering the comments on our CY 2022 proposals, we agreed with commenters that the use of a multi-year transition would help smooth out the changes in payment resulting from the clinical labor pricing update, avoiding potentially disruptive changes in payment for affected interested parties, and promoting payment stability from year-to-year. We believed it would be appropriate to use a 4-year transition, as we have for several other broad-based updates or methodological changes. While we recognized that using a 4-year transition to implement the update means that we will continue to rely in part on outdated data for clinical labor pricing until the change is fully completed in CY 2025, we agreed with the commenters that these significant updates to PE valuation should be implemented in the same way, and for the same reasons, as for other major updates to pricing such as the recent supply and equipment update. Therefore, we finalized the implementation of the clinical labor pricing update over 4 years to transition from current prices to the final updated prices in CY 2025. We finalized the implementation of this pricing transition over 4 years, such that one quarter of the difference between the current price and the fully phased-in price is implemented for CY 2022, one third of the difference between the CY 2022 price and the final price is implemented for CY 2023, and one half of the difference between the CY 2023 price and the final price is implemented for CY 2024, with the new direct PE prices fully implemented for CY 2025. (86 FR 65025) An example of the transition from the current to the fully-implemented new pricing that we finalized in the CY 2022 PFS final rule is provided in Table 4.

EP07AU23.003

(1) CY 2023 Clinical Labor Pricing Updates

For CY 2023, we received information from one interested party regarding the pricing of the Histotechnologist (L037B) clinical labor type. The interested party provided data from the 2019 Wage Survey of Medical Laboratories which supported an increase in the per-minute rate from the $0.55 finalized in the CY 2022 PFS final rule to $0.64. This rate of $0.64 for the L037B clinical labor type is a close match to the online salary data that we had for the Histotechnologist and matches the $0.64 rate that we initially proposed for L037B in the CY 2022 PFS proposed rule. Based on the wage data provided by the commenter, we proposed this $0.64 rate for the L037B clinical labor type for CY 2023; we also proposed a slight increase in the pricing for the Lab Tech/Histotechnologist (L035A) clinical labor type from $0.55 to $0.60 as it is a blend of the wage rate for the Lab Technician (L033A) and Histotechnologist clinical labor types. We also proposed the same increase to $0.60 for the Angio Technician (L041A) clinical labor type, as we previously established a policy in the CY 2022 PFS final rule that the pricing for the L041A clinical labor type would match the rate for the L035A clinical labor type (86 FR 65032).

Based on comments received on the CY 2023 proposed rule, we finalized a change in the descriptive text of the L041A clinical labor type from “Angio Technician” to “Vascular Interventional Technologist”. We also finalized an update in the pricing of three clinical labor types: from $0.60 to $0.84 for the Vascular Interventional Technologist (L041A), from $0.63 to $0.79 for the Mammography Technologist (L043A), and from $0.76 to $0.78 for the CT Technologist (L046A) based on submitted wage data from the 2022 Radiologic Technologist Wage and Salary Survey (87 FR 69422 through 69425).

(2) CY 2024 Clinical Labor Pricing Update Proposals

We did not receive new wage data or other additional information for use in clinical labor pricing from interested parties prior to the publication of the CY 2024 PFS proposed rule. Therefore, our proposed clinical labor pricing for CY 2024 is based on the clinical labor pricing that we finalized in the CY 2023 PFS final rule, incremented an additional step for Year 3 of the update:

BILLING CODE 4120-01-C

EP07AU23.004

EP07AU23.005

As was the case for the market-based supply and equipment pricing update, the clinical labor rates will remain open for public comment over the course of the 4-year transition period. We updated the pricing of a number of clinical labor types in the CY 2022 and CY 2023 PFS final rules in response to information provided by commenters. For the full discussion of the clinical labor pricing update, we direct readers to the CY 2022 PFS final rule (86 FR 65020 through 65037).

d. Technical Corrections to Direct PE Input Database and Supporting Files

Following the publication of the CY 2023 PFS proposed rule, an interested party notified CMS that CPT code 86153 (

Cell enumeration using immunologic selection and identification in fluid specimen (e.g., circulating tumor cells in blood); physician interpretation and report, when required

) appeared to be missing its work time in the Physician Work Time public use file. We reviewed the request from the interested party and determined that this was indeed an unintended technical error; we stated in the CY 2013 PFS final rule that we were finalizing 0 minutes pre-service time, 20 minutes intraservice time, and 0 minutes post-service time to CPT code 86153 (77 FR 69059), however work time was inadvertently completely missing for this code. Therefore, we are proposing to add the correct 20 minutes of intraservice work time to CPT code 86153 for CY 2024.

5. Soliciting Public Comment on Strategies for Updates to Practice Expense Data Collection and Methodology

a. Background

The AMA PPIS was first introduced in 2007 as a means to collect comprehensive and reliable data on the direct and indirect PEs incurred by physicians (72 FR 66222). In considering the use of PPIS data, the goal was to improve the accuracy and consistency of PE RVUs used in the PFS. The data collection process included a stratified random sample of physicians across various specialties, and the survey was administered between August 2007 and March 2008. Data points from that period of time that are integrated into PFS calculations today. In the CY 2009 PFS proposed rule (73 FR 38507 through 3850), we discussed the indirect PE methodology that used data from the AMA's survey that predated the PPIS. In CY 2010 PFS rulemaking, we announced our intent to incorporate the AMA PPIS data into the PFS ratesetting process, which would first affect the PE RVU. In the CY 2010 PFS proposed rule, we outlined a 4-year transition period, during which we would phase in the AMA PPIS data, replacing the existing PE data sources (74 FR 33554). We also explained that our proposals intended to update survey data only (74 FR 33530 through 33531). In our CY 2010 final rule, we finalized our proposal, with minor adjustments based on public comments (74 FR 61749 through 61750). We responded to the comments we received about the transition to using the PPIS to inform indirect PE allocations (74 FR 61750). In the responses, we acknowledged concerns about potential gaps in the data, which could impact the allocation of indirect PE for certain physician specialties and suppliers, which are issues that remain important today. The CY 2010 PFS final rule explains that section 212 of the Balanced Budget Refinement Act of 1999 (BBRA) (Pub. L. 106-113, November 29, 1999) directed the Secretary to establish a process under which we accept and use, to the maximum extent practicable and consistent with sound data practices, data collected or developed by entities and organizations to supplement the data we normally collect in determining the PE component. BBRA required us to establish criteria for accepting supplemental survey data. Since the supplemental surveys were specific to individual specialties and not part of a comprehensive multispecialty survey, we had required that certain precision levels be met in order to ensure that the supplemental data was sufficiently valid, and acceptable for use in the development of the PE RVUs. At the time, our rationale included the assumption that because the PPIS is a contemporaneous, consistently collected, and comprehensive multispecialty survey, we do not believe similar precision requirements are necessary, and we did not propose to establish them for the use of the PPIS data (74 FR 61742). We noted potential gaps in the data, which could impact the allocation of indirect PE for certain physician and suppliers. The CY 2010 final rule adopted the proposal, with minor adjustments based on public comments, and explained that these minor adjustments were in part due to non-response bias that results when the characteristics of survey respondents differ in meaningful ways, such as in the mix of practices sizes, from the general population (74 FR 61749 through 61750).

Throughout the 4-year transition period, from CY 2010 to CY 2013, we gradually incorporated the AMA PPIS data into the PFS rates, replacing the previous data sources. The process involved addressing concerns and making adjustments as necessary, such as refining the PFS ratesetting methodology in consideration of interested party feedback. For background on the refinements that we considered after the transition began, we refer readers to discussions in the CY 2011-2014 final rules (75 FR 73178 through 73179; 76 FR 73033 through 73034; 77 FR 98892; 78 FR 74272 through 74276).

In the CY 2011 PFS proposed rule, we requested comments on the methodology for calculating indirect PE RVUs, explicitly seeking input on using survey data, allocation methods, and potential improvements (75 FR 40050). In our CY 2011 PFS final rule, we addressed comments regarding the methodology for indirect PE calculations, focusing on using survey data, allocation methods, and potential improvements (75 FR 73178 through 73179). We recognized some limitations of the current PFS ratesetting methodology but maintained that the approach was the most appropriate at the time. In the CY 2012 PFS final rule, we responded to comments related to indirect PE methodology, including concerns about allocating indirect PE to specific services and using the AMA

PPIS data for certain specialties (76 FR 73033 through 73034). We indicated that CMS would continue to review and refine the methodology and work with interested parties to address their concerns. In the CY PFS 2014 final rule, we responded to comments about fully implementing the AMA PPIS data. By 2014, the AMA PPIS data had been fully integrated into the PFS, serving as the primary source for determining indirect PE inputs (78 FR 74235). We continued to review data and the PE methodology annually, considering interested party feedback and evaluating the need for updates or refinements to ensure the accuracy and relevance of PE RVUs (79 FR 67548). In the years following the full implementation of the AMA PPIS data, we further engaged with interested parties, thought leaders and subject matter experts to improve our PE inputs' accuracy and reliability. For further background, we refer readers to our discussions in final rules for CY 2016-2022 (80 FR 70892; 81 FR 80175; 82 FR 52980 through 52981; 83 FR 59455 through 59456; 84 FR 62572; 85 FR 84476 through 84478; 86 FR 62572).

In our CY 2023 PFS final rule, we issued an RFI to solicit public comment on strategies to update PE data collection and methodology (87 FR 69429 to 69432). We solicited comments on current and evolving trends in health care business arrangements, the use of technology, or similar topics that might affect or factor into PE calculations. We remind readers that we have worked with interested parties and CMS contractors for years to study the landscape and identify possible strategies to reshape the PE portion of physician payments. The fundamental issues are clear, but thought leaders and subject matter experts have advocated for more than one tenable approach to updating our PE methodology.

As described in last year's rule, we have continued interest in developing a roadmap for updates to our PE methodology that account for changes in the health care landscape. Of various considerations necessary to form a roadmap for updates, we reiterate that allocations of indirect PE continue to present a wide range of challenges and opportunities. As discussed in multiple cycles of previous rulemaking, our PE methodology relies on AMA PPIS data, which may represent the best aggregated available source of information at this time. However, we acknowledge the limitations and challenges interested parties have raised about using the current data for indirect PE allocations, which we have also examined in related ongoing research. We noted in last year's rule that there are several competing concerns that CMS must take into account when considering updated data sources, which also should support and enable ongoing refinements to our PE methodology.

Many commenters last year asked that CMS wait for the AMA to complete a refresh of AMA survey data. We responded to these comments by explaining the tension that waiting creates in light of concerns raised by other interested parties. Waiting for refreshed survey data would result in CMS using data nearly 20 years old to form indirect PE inputs to set rates for services on the PFS. We remind readers that many of the critical issues discussed in the background and history above are mainly unchanged and possibly would not be addressed by an updated survey alone but may also require revisions to the PFS ratesetting methodology.

b. Request for Information

We continue to encourage interested parties to provide feedback and suggestions to CMS that give an evidentiary basis to shape optimal PE data collection and methodological adjustments over time. Submissions should discuss the feasibility and burden of implementing any suggested adjustments and highlight opportunities to optimize the cadence, frequency, and phase-in of resulting adjustments. We continue to consider ways that we may engage in dialogue with interested parties to better understand how to address possible long-term policies and methods for PFS ratesetting. We believe some of those concerns may be alleviated by having ways to refresh data and make transparent how the information affects valuations for services payable under the PFS more accurately and precisely.

Considering our ratesetting methodology and prior experiences implementing new data, we are issuing a follow-up solicitation for general information. We seek comments from interested parties on strategies to incorporate information that could address known challenges we experienced in implementing the initial AMA PPIS data. Our current methodology relies on the AMA PPIS data, legislatively mandated supplemental data sources (for, example, we use supplemental survey data collected in 2003, as required by section 1848(c)(2)(H)(i) of the Act to set rates for oncology and hematology specialties), and in some cases crosswalks to allocate indirect PE as necessary for certain specialties and provider types.

We also seek to understand whether, upon completion of the updated PPIS data collection effort by the AMA, contingencies or alternatives may be necessary and available to address lack of data availability or response rates for a given specialty, set of specialties, or specific service suppliers who are paid under the PFS.

In light of the considerations discussed above, we request feedback on the following:

(1) If CMS should consider aggregating data for certain physician specialties to generate indirect allocators so that PE/HR calculations based on PPIS data would be less likely to over-allocate (or under-allocate) indirect PE to a given set of services, specialties, or practice types. Further, what thresholds or methodological approaches could be employed to establish such aggregations?

(2) Whether aggregations of services, for purposes of assigning PE inputs, represent a fair, stable and accurate means to account for indirect PEs across various specialties or practice types?

(3) If and how CMS should balance factors that influence indirect PE inputs when these factors are likely driven by a difference in geographic location or setting of care, specific to individual practitioners (or practitioner types) versus other specialty/practice-specific characteristics (for example, practice size, patient population served)?

(4) What possible unintended consequences may result if CMS were to act upon the respondents' recommendations for any of highlighted considerations above?

(5) Whether specific types of outliers or non-response bias may require different analytical approaches and methodological adjustments to integrate refreshed data?

C. Potentially Misvalued Services Under the PFS

1. Background

Section 1848(c)(2)(B) of the Act directs the Secretary to conduct a periodic review, not less often than every 5 years, of the relative value units (RVUs) established under the PFS. Section 1848(c)(2)(K) of the Act requires the Secretary to periodically identify potentially misvalued services using certain criteria and to review and make appropriate adjustments to the relative values for those services. Section 1848(c)(2)(L) of the Act also requires the Secretary to develop a process to validate the RVUs of certain potentially misvalued codes under the PFS, using the same criteria used to identify

potentially misvalued codes, and to make appropriate adjustments.

As discussed in section II.E. of this proposed rule, under Valuation of Specific Codes, each year we develop appropriate adjustments to the RVUs taking into account recommendations provided by the American Medical Association (AMA) Resource-Based Relative Value Scale (RVS) Update Committee (RUC), MedPAC, and other interested parties. For many years, the RUC has provided us with recommendations on the appropriate relative values for new, revised, and potentially misvalued PFS services. We review these recommendations on a code-by-code basis and consider these recommendations in conjunction with analyses of other data, such as claims data, to inform the decision-making process as authorized by statute. We may also consider analyses of work time, work RVUs, or direct PE inputs using other data sources, such as Department of Veteran Affairs (VA), National Surgical Quality Improvement Program (NSQIP), the Society for Thoracic Surgeons (STS), and the Merit-based Incentive Payment System (MIPS) data. In addition to considering the most recently available data, we assess the results of physician surveys and specialty recommendations submitted to us by the RUC for our review. We also considered information provided by other interested parties such as from the general medical-related community and the public. We conducted a review to assess the appropriate RVUs in the context of contemporary medical practice. We note that section 1848(c)(2)(A)(ii) of the Act authorizes the use of extrapolation and other techniques to determine the RVUs for physicians' services for which specific data are not available and requires us to take into account the results of consultations with organizations representing physicians who provide the services. In accordance with section 1848(c) of the Act, we determine and make appropriate adjustments to the RVUs.

In its March 2006 Report to the Congress (

http://www.medpac.gov/docs/default-source/reports/Mar06_Ch03.pdf?sfvrsn=0

), MedPAC discussed the importance of appropriately valuing physicians' services, noting that misvalued services can distort the market for physicians' services, as well as for other health care services that physicians order, such as hospital services. In that same report, MedPAC postulated that physicians' services under the PFS can become misvalued over time. MedPAC stated, “When a new service is added to the physician fee schedule, it may be assigned a relatively high value because of the time, technical skill, and psychological stress that are often required to furnish that service. Over time, the work required for certain services would be expected to decline as physicians become more familiar with the service and more efficient in furnishing it.” We believe services can also become overvalued when PE costs decline. This can happen when the costs of equipment and supplies fall, or when equipment is used more frequently than is estimated in the PE methodology, reducing its cost per use. Likewise, services can become undervalued when physician work increases or PE costs rise.

As MedPAC noted in its March 2009 Report to Congress (

http://www.medpac.gov/docs/default-source/reports/march-2009-report-to-congress-medicare-payment-policy.pdf

), in the intervening years since MedPAC made the initial recommendations, CMS and the RUC have taken several steps to improve the review process. Also, section 1848(c)(2)(K)(ii) of the Act augments our efforts by directing the Secretary to specifically examine, as determined appropriate, potentially misvalued services in the following categories:

• Codes that have experienced the fastest growth.

• Codes that have experienced substantial changes in PE.

• Codes that describe new technologies or services within an appropriate time-period (such as 3 years) after the relative values are initially established for such codes.

• Codes which are multiple codes that are frequently billed in conjunction with furnishing a single service.

• Codes with low relative values, particularly those that are often billed multiple times for a single treatment.

• Codes that have not been subject to review since implementation of the fee schedule.

• Codes that account for the majority of spending under the PFS.

• Codes for services that have experienced a substantial change in the hospital length of stay or procedure time.

• Codes for which there may be a change in the typical site of service since the code was last valued.

• Codes for which there is a significant difference in payment for the same service between different sites of service.

• Codes for which there may be anomalies in relative values within a family of codes.

• Codes for services where there may be efficiencies when a service is furnished at the same time as other services.

• Codes with high intraservice work per unit of time.

• Codes with high PE RVUs.

• Codes with high cost supplies.

• Codes as determined appropriate by the Secretary.

Section 1848(c)(2)(K)(iii) of the Act also specifies that the Secretary may use existing processes to receive recommendations on the review and appropriate adjustment of potentially misvalued services. In addition, the Secretary may conduct surveys, other data collection activities, studies, or other analyses, as the Secretary determines to be appropriate, to facilitate the review and appropriate adjustment of potentially misvalued services. This section also authorizes the use of analytic contractors to identify and analyze potentially misvalued codes, conduct surveys or collect data, and make recommendations on the review and appropriate adjustment of potentially misvalued services. Additionally, this section provides that the Secretary may coordinate the review and adjustment of any RVU with the periodic review described in section 1848(c)(2)(B) of the Act. Section 1848(c)(2)(K)(iii)(V) of the Act specifies that the Secretary may make appropriate coding revisions (including using existing processes for consideration of coding changes) that may include consolidation of individual services into bundled codes for payment under the PFS.

2. Progress in Identifying and Reviewing Potentially Misvalued Codes

To fulfill our statutory mandate, we have identified and reviewed numerous potentially misvalued codes as specified in section 1848(c)(2)(K)(ii) of the Act, and we intend to continue our work examining potentially misvalued codes in these areas over the upcoming years. As part of our current process, we identify potentially misvalued codes for review, and request recommendations from the RUC and other public commenters on revised work RVUs and direct PE inputs for those codes. The RUC, through its own processes, also identifies potentially misvalued codes for review. Through our public nomination process for potentially misvalued codes established in the CY 2012 PFS final rule with comment period (76 FR 73026, 73058 through 73059), other individuals and groups submit nominations for review of potentially misvalued codes as well. Individuals and groups may submit

codes for review under the potentially misvalued codes initiative to CMS in one of two ways. Nominations may be submitted to CMS via email or through postal mail. Email submissions should be sent to the CMS emailbox at

MedicarePhysicianFeeSchedule@cms.hhs.gov

, with the phrase “Potentially Misvalued Codes” and the referencing CPT code number(s) and/or the CPT descriptor(s) in the subject line. Physical letters for nominations should be sent via the U.S. Postal Service to the Centers for Medicare & Medicaid Services, Mail Stop: C4-01-26, 7500 Security Blvd., Baltimore, Maryland 21244. Envelopes containing the nomination letters must be labeled “Attention: Division of Practitioner Services, Potentially Misvalued Codes.” Nominations for consideration in our next annual rule cycle should be received by our February 10th deadline. Since CY 2009, as a part of the annual potentially misvalued code review and Five-Year Review process, we have reviewed over 1,700 potentially misvalued codes to refine work RVUs and direct PE inputs. We have assigned appropriate work RVUs and direct PE inputs for these services as a result of these reviews. A more detailed discussion of the extensive prior reviews of potentially misvalued codes is included in the CY 2012 PFS final rule with comment period (76 FR 73052 through 73055). In the same CY 2012 PFS final rule with comment period, we finalized our policy to consolidate the review of physician work and PE at the same time, and established a process for the annual public nomination of potentially misvalued services.

In the CY 2013 PFS final rule with comment period (77 FR 68892, 68896 through 68897), we built upon the work we began in CY 2009 to review potentially misvalued codes that have not been reviewed since the implementation of the PFS (so-called “Harvard-valued codes”).

1

In the CY 2019 PFS proposed rule (73 FR 38589), we requested recommendations from the RUC to aid in our review of Harvard-valued codes that had not yet been reviewed, focusing first on high-volume, low intensity codes. In the fourth Five-Year Review of Work RVUs proposed rule (76 FR 32410, 32419), we requested recommendations from the RUC to aid in our review of Harvard-valued codes with annual utilization of greater than 30,000 services. In the CY 2013 PFS final rule with comment period, we identified specific Harvard-valued services with annual allowed charges that total at least $10,000,000 as potentially misvalued. In addition to the Harvard-valued codes, in the CY 2013 PFS final rule with comment period we finalized for review a list of potentially misvalued codes that have stand-alone PE (codes with physician work and no listed work time and codes with no physician work that have listed work time). We continue each year to consider and finalize a list of potentially misvalued codes that have or will be reviewed and revised as appropriate in future rulemaking.

1

The research team and panels of experts at the Harvard School of Public Health developed the original work RVUs for most CPT codes, in a cooperative agreement with the Department of Health and Human Services (HHS). Experts from both inside and outside the Federal Government obtained input from numerous physician specialty groups. This input was incorporated into the initial PFS, which was implemented on January 1, 1992.

3. CY 2024 Identification and Review of Potentially Misvalued Services

In the CY 2012 PFS final rule with comment period (76 FR 73058), we finalized a process for the public to nominate potentially misvalued codes. In the CY 2015 PFS final rule with comment period (79 FR 67548, 67606 through 67608), we modified this process whereby the public and interested parties may nominate potentially misvalued codes for review by submitting the code with supporting documentation by February 10th of each year. Supporting documentation for codes nominated for the annual review of potentially misvalued codes may include the following:

• Documentation in peer reviewed medical literature or other reliable data that demonstrate changes in physician work due to one or more of the following: technique, knowledge and technology, patient population, site-of-service, length of hospital stay, and work time.

• An anomalous relationship between the code being proposed for review and other codes.

• Evidence that technology has changed physician work.

• Analysis of other data on time and effort measures, such as operating room logs or national and other representative databases.

• Evidence that incorrect assumptions were made in the previous valuation of the service, such as a misleading vignette, survey, or flawed crosswalk assumptions in a previous evaluation.

• Prices for certain high cost supplies or other direct PE inputs that are used to determine PE RVUs are inaccurate and do not reflect current information.

• Analyses of work time, work RVU, or direct PE inputs using other data sources (for example, VA, NSQIP, the STS National Database, and the MIPS data).

• National surveys of work time and intensity from professional and management societies and organizations, such as hospital associations.

We evaluate the supporting documentation submitted with the nominated codes and assess whether the nominated codes appear to be potentially misvalued codes appropriate for review under the annual process. In the following year's PFS proposed rule, we publish the list of nominated codes and indicate for each nominated code whether we agree with its inclusion as a potentially misvalued code. The public has the opportunity to comment on these and all other proposed potentially misvalued codes. In each year's final rule, we finalize our list of potentially misvalued codes.

a. Public Nominations

In each proposed rule, we seek nominations from the public and from interested parties of codes that they believe we should consider as potentially misvalued. We receive public nominations for potentially misvalued codes by February 10th and we display these nominations on our public website, where we include the submitter's name and their associated organization for full transparency. We sometimes receive submissions for specific, PE-related inputs for codes, and discuss these PE-related submissions, as necessary under the Determination of PE RVUs section of the rule. We summarize below this year's submissions under the potentially misvalued code initiative. For CY 2024, we received 10 nominations concerning various codes. The nominations are as follows:

(1) CPT Code 59200

In the CY 2022 PFS proposed rule, an interested party nominated CPT code 59200 (

Insertion cervical dilator (e.g., laminaria, prostaglandin

)) (000 zero day global code) as potentially misvalued, because the direct PE inputs for this code do not include the supply item, Dilapan-S. Previous parties had initially sought to establish a Level II HCPCS code for Dilapan-S, but CMS did not find sufficient evidence to support that request. The same interested party then submitted Dilapan-S to be considered as a practice expense (PE) supply input to a Level I CPT code 59200 (86 FR 65045). This year, a different interested party has nominated CPT code 59200 again, and provided the same reasoning as to why this code is potentially misvalued.

Specifically, the current nominee recommends adding 4 rods of Dilapan-S at $80.00 per unit, for a total of $320.00 to this one PE supply inputs, as a replacement for the current PE supply item—laminaria tent (a small rod of dehydrated seaweed that rehydrates, absorbing the water from the surrounding tissue). The laminaria tent is currently listed at $4.0683 per unit, with a total of 3 units, for a total of $12.20. The current nominee stated that Dilapan-S is more consistent and reliable, and suggested that it had higher patient satisfaction than the laminaria tent, and that it was less likely to cause leukocytosis. CPT code 59200 is a relatively low volume code, with respect to Medicare claims and, as the nominator has stated, this service is more typically billed for the Medicaid population, as evidenced by 1.3 million Medicaid claims for this service. Medicaid programs are able to set their own payment policies, which can be different from Medicare payment policies. The current Medicare payment for CPT code 59200 in CY 2023 is about $108.10 in the nonfacility/office setting, which is much less than the typical cost of the Dilapan-S supplies requested by the interested party. The requested 4 rods of Dilapan-S would increase the supply costs of CPT code 59200 by a factor of five and represent an enormous increase in the direct costs for the service.

We do not agree that CPT code 59200 is potentially misvalued, and we do not agree with interested parties that the use of the Dilapan-S supply would be typical for this service. By including the increased direct costs of the service ($320.00, the typical cost of four units of this supply item, Dilapan-S) in the valuation for this code, the cost of this service will expand both Medicare spending and cost sharing for any beneficiary who receives this service. The cost of Dilapan-S is over 19 times higher than the cost of the current supply item (laminaria tent) for CPT code 59200. We do agree with the nominator that CPT code 59200 is much more frequently reported in the Medicaid population, and therefore, we suggest that interested parties submit a request for new and separate Medicaid payments to Medicaid.

We are not proposing to consider this code as potentially misvalued for CY 2024, though we welcome comments on this nomination for further consideration. We are soliciting comments on CPT code 59200 and whether the absence of supply item Dilapan-S makes the nonfacility/office Medicare payment for this service potentially misvalued.

(2) CPT Code 27279

CPT code 27279 (

Arthrodesis, sacroiliac joint, percutaneous or minimally invasive (indirect visualization), with image guidance, includes obtaining bone graft when performed, and placement of transfixing device

) (090 day global code) has been nominated as misvalued due to the absence of separate direct PE inputs for this 090 day global code in the nonfacility office setting. Currently, the PFS only prices CPT code 27279 in the facility setting, at about $826.85 for the physician's professional services, but the nominators are seeking separate direct PE inputs for this service to better account for valuation when performed in the nonfacility/office setting. These PE amounts for CPT code 27279 are expected to be approximately $21,897.63 in total, which is the Medicare outpatient payment amount for CY 2023.

The nominator claims that CPT code 27279 can be safely and effectively furnished in the nonfacility setting, and that this procedure has a low risk profile, similar to kyphoplasty (CPT codes 22513, 22514, and 22515), which is currently furnished in the nonfacility setting. The nominator describes Kyphoplasty as “a percutaneous minimally invasive procedure depositing poly methyl methacrylate via canula into vertebral bodies near neural structures.” The nominator states that permitting payment for direct PE inputs for CPT code 27279 in the nonfacility/office setting would increase access to this service for Medicare patients. One sample invoice for $17,985.00 with three units of the itemized supply item IFuse-3D Implant 7.0 mm × 55 mm, US ($5,995.00 per unit) was submitted with this nomination to illustrate the high direct PE costs for CPT code 27279, should CMS value this code in the nonfacility/office setting.

We are concerned about whether this 090 day surgical service can be safely and effectively furnished in the non-facility/office setting (for example, in an office-based surgical suite). We welcome comments on the nomination of CPT code 27279 for consideration as potentially misvalued.

(3) CPT Codes 99221, 99222, and 99223

An interested party nominated the Hospital Inpatient and Observation Care visit CPT codes 99221 (

Initial hospital care, per day, for the evaluation and management of a patient, which requires these 3 key components: A detailed or comprehensive history; A detailed or comprehensive examination; and Medical decision making that is straightforward or of low complexity. Counseling and/or coordination of care with other physicians, other qualified health care professionals, or agencies are provided consistent with the nature of the problem(s) and the patient's and/or family's needs. Usually, the problem(s) requiring admission are of low severity. Typically, 30 minutes are spent at the bedside and on the patient's hospital floor or unit.

), 99222 (

Initial hospital care, per day, for the evaluation and management of a patient, which requires these 3 key components: A comprehensive history; A comprehensive examination; and Medical decision making of moderate complexity. Counseling and/or coordination of care with other physicians, other qualified health care professionals, or agencies are provided consistent with the nature of the problem(s) and the patient's and/or family's needs. Usually, the problem(s) requiring admission are of moderate severity. Typically, 50 minutes are spent at the bedside and on the patient's hospital floor or unit.

), and 99223 (

Initial hospital care, per day, for the evaluation and management of a patient, which requires these 3 key components: A comprehensive history; A comprehensive examination; and Medical decision making of high complexity. Counseling and/or coordination of care with other physicians, other qualified health care professionals, or agencies are provided consistent with the nature of the problem(s) and the patient's and/or family's needs. Usually, the problem(s) requiring admission are of high severity. Typically, 70 minutes are spent at the bedside and on the patient's hospital floor or unit.)

as potentially misvalued. CMS reviewed these codes in the CY 2023 final rule (87 FR 69588) and established new physician work times and new work RVU payments for these codes. The nominator disagrees with these values and asserts that these “facility-based codes are always inherently (or proportionately) more intense than E/M services provided in other settings [in particular],” with patients presenting with potentially infectious diseases, such as meningitis; pneumonia; tuberculosis; HIV/AIDS; Ebola virus; Zika virus; and, most recently, SARS-CoV-2 and mpox, and that the inpatient setting has a predominance of more seriously ill patients, who are sometimes immunocompromised and/or have multiple drug interaction issues and/or with comorbidities, making them extraordinarily more complex than those patients typically found in the

office setting (with many of these infections being health care-associated infections and antibiotic-resistant bacterial infections). It should be noted that these new requests did not offer appreciably new information relative to last year's nomination/consideration.

The nominator seeks a new work RVU value of 1.92 for CPT code 99221, a new work RVU of 2.79 for CPT code 99222, and a new work value of 4.25 for CPT code 99223. Currently, CPT code 99221 has a work RVU of 1.63, a reduction of 15.1 percent from its 1.92 work RVU from CY 2022. CPT code 99222 had a work RVU of 2.61 in CY 2022 and is now at 2.60. CPT code 99223 had a work RVU of 3.86 in CY 2022. It now has a value of 3.50, which is a reduction of 9.3 percent. The nominator has requested that the work RVU for CPT code 99221 be restored back to 1.92, that the work RVU of CPT code 99222 be increased to 2.79, and that the work RVU of CPT code 99223 be increased to 4.25 (please see Table 6 for a comparison of work RVU values for CY 2022, CY 2023, and of those requested by the nominator).

EP07AU23.006

After consideration of this nomination and their requests for higher work RVUs for CPT codes 99221, 99222, and 99223, we are proposing to maintain the values that we finalized for these codes in the CY 2023 PFS final rule (87 FR 69588). Even so, we welcome comments on the nomination of these codes as potentially misvalued.

(4) CPT Codes 36514, 36516, 36522

An interested party nominated CPT codes 36514 (

Therapeutic apheresis; for plasma pheresis

), 36516 (

Therapeutic apheresis; with extracorporeal immunoadsorption, selective adsorption or selective filtration and plasma reinfusion

), and 36522 (

Photopheresis, extracorporeal

) (all 000 zero day global codes) as potentially misvalued. The interested party stated that the direct PE of clinical labor L042A, “RN/LPN” (for labor rate of $0.525 per minute) was incorrect and should be changed to a more specific entry of “a therapeutic apheresis nurse specialist (RN)” (for a labor rate of about $1.06 to $1.14 per minute), which would approximately double all three of these codes' clinical labor PE entries. In addition, the nominator disagrees with the current direct PE of supply item SC085, “Tubing set, plasma exchange” at $186.12 per item, and believes that this should be worth $248.77 per item with CPT code 36514, using a quantity of one item. The nominator believes that supply item SC084, “Tubing set, blood warmer,” that we currently have listed at $8.01 per item, should be worth $14.71 per item with CPT code 36514, also using a quantity of one item. Sample invoices (not actual invoices) were submitted for illustration and support. We welcome comments on the nomination of these codes as potentially misvalued, or not.

(5) CPT Codes 44205 and 44204

An interested party nominated CPT code 44205 (

Laparoscopy, surgical; colectomy, partial, with removal of terminal ileum with ileocolostomy

), as potentially misvalued, requesting that payment for this code be made equivalent to the payment for CPT code 44204 (

Laparoscopy, surgical; colectomy, partial, with anastomosis

), which is a higher amount. Both codes are 090 day global codes, currently valued only in the facility setting. CPT code 44204 has a total RVU of 45.62 for CY 2023 and CPT code 44205 has a total RVU of 39.62 for CY 2023, with a difference of 6.00 RVUs. CPT code 44204 is associated with 5 to 6 percent more physician work time: 455.0 minutes in total, as compared to 428.5 minutes in total for CPT code 44205. The work RVU for CPT code 44204 is also 15 percent higher than the work RVU for CPT code 44205. The direct PE entries for both codes are the same with regard to supplies, equipment, and clinical labor, except that in the clinical labor and equipment entries, the number of usage minutes is higher for CPT code 44204.

Though these two codes appear to be similar, they are still different in their purpose, physician work times, and direct PEs, with CPT code 44204 involving more time and resources (and having a higher payment, accordingly). For these reasons, we are not inclined to agree that CPT code 44205 is potentially misvalued when compared to CPT code 44204, or to modify this payment differential by paying a higher amount for CPT code 44205. We are soliciting feedback regarding the nomination of CPT code 44205 as potentially misvalued.

(6) CPT Codes 93655 and 93657

An interested party nominated CPT codes 93655 (

Intracardiac catheter ablation of a discrete mechanism of arrhythmia which is distinct from the primary ablated mechanism, including repeat diagnostic maneuvers, to treat a spontaneous or induced arrhythmia (List separately in addition to code for primary procedure))

and 93657

(Additional linear or focal intracardiac catheter ablation of the left or right atrium for treatment of atrial fibrillation remaining after completion of pulmonary vein isolation (List separately in addition to code for primary procedure)),

as potentially misvalued. These two add-on codes were part of our code review in the cardiac ablation code family in the CY 2022 (86 FR 65108) and CY 2023 (87 FR 69516) final rules.

The nominator reiterates that the primary procedures involve “high intensity clinical decision making, complexity in the intraoperative skills required for treatment, morbidity/mortality risks to the patient, and work intensity” and that the work RVUs for both of these add-on codes should reflect the AMA RUC recommended 7.00 work RVUs. We disagreed with this value in CY 2022, and we continue to believe that a work RVU of 5.50 is appropriate for the 60 minutes of physician service time for both codes. We see no reason to reconsider our valuation of CPT codes 93655 and

93657 for CY 2022 or CY 2023, and we do not consider these codes to be potentially misvalued now. We are not proposing to nominate these codes as potentially misvalued for CY 2024.

(7) CPT Code 94762 and 95800

An interested party nominated CPT code 94762 (

Noninvasive ear or pulse oximetry for oxygen saturation; by continuous overnight monitoring (separate procedure)

) as potentially misvalued due to the PE items listed for this code, which were last reviewed in 2009. There is no physician work/professional component associated with this code. The nominator states that the technology behind this code has changed considerably over the last 14 years, and that the listed equipment items for CPT code 94762, EQ212 “pulse oxymetry recording software (prolonged monitoring)” and EQ353 “Pulse oximeter 920 M Plus” are now typically found in a one-time use supply item: SD263 “WatchPAT pneumo-opt slp probes” (extended external overnight pulse oximeter device probe and battery with bluetooth, medical magnetic tape recorder) (WatchPAT One Device) costing $99.00 each, derived from two sample invoices (not actual invoices) that were included with the nomination. According to our PE supply list, item SD263 costs $73.32, which is $25.68 less than the amounts found in the sample invoices submitted by the nominators. The nominator retains equipment item EQ212 “pulse oxymetry recording software (prolonged monitoring)”, and replaces equipment item EQ353 with ED021, a “computer, desktop, w-monitor.” Payment for CPT code 94762 is currently $25.75 in the nonfacility office setting. There were 122,207 allowed service claims for CPT code 94762 in CY 2021. The facility payment amount for CPT code 94762 under the Medicare Hospital Outpatient Prospective Payment System (OPPS) is currently $145.43.

The same interested party who nominated CPT code 94762 also nominated CPT code 95800 (

Sleep study, unattended, simultaneous recording; heart rate, oxygen saturation, respiratory analysis (e.g., by airflow or peripheral arterial tone), and sleep time

) as potentially misvalued, requesting that CMS update PE items for this code, which were last reviewed in 2017. CPT code 95800 currently includes the entry of a one-time use supply item, SD263 “WatchPAT pneumo-opt slp probes” (extended external overnight pulse oximeter device probe and battery with bluetooth, medical magnetic tape recorder) (WatchPAT One Device), which costs $73.32 per item, in contrast to the pricing in the sample invoice—$99.00 each (case of 12 × $99.00 = $1,188.00). This is a $25.68 difference in this supply item's cost.

The nominator excludes the current equipment for this code (EQ335 “WatchPAT 200 Unit with strap, cables, charger, booklet and patient video” and EQ336 “Oximetry and Airflow Device”) and instead includes ED021 (“computer, desktop, w-monitor”) in the PE for this code. We note that we have not previously included ED021 as a specialized equipment item dedicated to this function (and EQ212 “pulse oxymetry recording software (prolonged monitoring)” is also not included in the PE for CPT code 95800, as it is with CPT code 94762). The nominator included the PE listings for CPT code 93245 (

Heart rhythm recording, analysis, interpretation and report of continuous external EKG over more than 1 week up to 1 weeks

) as an example of how PE supply items for CPT code 95800 should be structured, but this code includes a supply item, SD339 “extended external ECG patch, medical magnetic tape recorder” and equipment item ED021 “computer, desktop, w-monitor,” which is presumed to be used to record the data from the ECG patch and to be used to analyze this data. CMS currently pays a total of $150.80 for CPT code 95800 in the non-facility office setting, and there were 53,793 allowed services for this code in CY 2021.

There is not clear evidence whether the WatchPAT One Device needs, or does not need, the specific monitoring and recording system (equipment item EQ212 “pulse oxymetry recording software (prolonged monitoring)”) for CPT code 95800 as opposed to any other system/process. The interested party has requested the practice expense changes discussed above as support for their argument that these CPT codes are potentially misvalued (See Table 7.)

BILLING CODE 4120-01-P

EP07AU23.007

We welcome comments as to whether or not these codes are potentially misvalued.

(8) CPT Codes 0596T and 0597T

An interested party has nominated CPT codes 0596T (

Initial insertion of temporary valve-pump in female urethra

) and 0597T (

Replacement of temporary valve-pump in female urethra

) as potentially misvalued due to MAC pricing, which is determined on a case-by-case basis. These temporary CPT category III codes are all procedure status “C” (contractor priced), and the interested party is seeking status “A” (for active payment status) to account for physician work, nonfacility PE, and professional liability costs. The nominator states that the MAC-determined payment amounts have been inappropriately low, and do not account for the time and the work that the physician expends for these services, or for all of the PE costs associated with the Vesiflo inFlow System. For CPT code 0596T, the nominator expects a physician to spend 60 minutes of work on installing this Vesiflo inFlow System. The nonfacility office PE items include a power table, a mayo stand, an examination light, clinical labor time of a RN/LPN/MTA totaling to 73 minutes, and a list of supplies summing to $1,902.76, primarily from the inFlow Measuring Device of $140.00, the inflow Device of $495.00, and the inflow Activator Kit of $1,250.00, making up about 99 percent of the total cost of supplies.

For CPT code 0597T, the nominator expects a physician to spend 25 minutes of work replacing this Vesiflo inFlow System. The nonfacility office PE items include a power table, a mayo stand, an examination light, clinical labor time of a RN/LPN/MTA totaling to 38 minutes, and a list of supplies summing to $505.30, primarily from the inflow device of $495.00, making up about 98 percent of the total cost of supplies. A sample invoice is included in this nomination (as opposed to an actual invoice).

We welcome comments as to whether or not these two temporary category II CPT codes, CPT codes 0596T and 0597T, are potentially misvalued, and whether these codes should remain contractor priced or not.

(9) CPT Code 93000

An interested party has nominated CPT code 93000 (

Electrocardiogram, routine ECG with at least 12 leads; with interpretation and report

) as potentially misvalued, arguing that we should increase Medicare payment for CPT code 93000 to $35.64, when used in conjunction with other supplies and services, to adequately compensate practitioners for their PE item costs for: (1) $6.10 for EKG leads; (2) $21.19 for a nurse visit of typically 5 minutes time (as illustrated by CPT code 99211 (

Office or other outpatient visit for the evaluation and management of an established patient, that may not require the presence of a physician or other qualified health care professional. Usually, the presenting problem(s) are minimal. Typically, 5 minutes are spent performing or supervising these services.)

); and (3) $7.64 for the interpretation and report for the EKG service (as illustrated by CPT code 93010 (

Electrocardiogram, routine ECG with at least 12 leads; interpretation and report only

). The interested party is asking for the grouping of these services to be valued at $35.64 (the actual sum of these inputs is $34.93). No invoices or other evidence were provided for consideration.

For CY 2023, the national payment amounts under the PFS for CPT codes 93000, 93010, and 99211 in the nonfacility office setting are as follows:

• CPT code 93000; total RVUs 0.43 × CF $33.8872 = $14.57.

• CPT code 93010; total RVUs 0.24 × CF $33.8872 = $8.13.

• CPT code 99211; total RVUs 0.69 × CF $33.8872 = $23.38.

• Sum total $46.08.

After consideration, we are not proposing to nominate CPT code 93000 as potentially misvalued for CY 2024. The sum of a mix of services is not a persuasive indication that one code—in this case, CPT code 93000—is potentially misvalued.

(10) 19 Therapy codes

An interested party has nominated 19 therapy codes as potentially misvalued. These 19 therapy codes were last reviewed by CMS in the CY 2018 PFS final rule (82 FR 53073 through 53074). The interested party stated that the direct PE clinical labor minutes as recommended by the AMA Relative Value Scale Update Committee (RUC) and Healthcare Professional Advisory Committee (HCPAC) Review Board might have had inappropriate multiple procedure payment reductions (MPPR) applied to their PE clinical labor time entries. The nominators are now seeking correction for those clinical labor time entries, which, if adjusted in accordance with the recommendations of the nominators, would likely result in slightly higher or nominally changed payments for the 19 therapy codes.

We have reviewed the clinical labor time entries for these 19 therapy codes, and we are now reconsidering the values established in the CY 2018 final rule. We do not believe that MPPR should be applied to these 19 nominated therapy codes' clinical labor time entries (listed in Table 8), and as a result, we would like the AMA RUC HCPAC recommendations from January 2017 to be re-reviewed. We recommend nomination of these 19 codes as potentially misvalued for CY 2024, and we welcome comments on this nomination.

EP07AU23.008

BILLING CODE 4120-01-C

D. Payment for Medicare Telehealth Services Under Section 1834(m) of the Act

As discussed in prior rulemaking, several conditions must be met for Medicare to make payment for telehealth services under the PFS. See further details and full discussion of the scope of Medicare telehealth services in the CY 2018 PFS final rule (82 FR 53006) and CY 2021 PFS final rule (85 FR 84502) and in 42 CFR 410.78 and 414.65.

1. Payment for Medicare Telehealth Services Under Section 1834(m) of the Act

a. Changes to the Medicare Telehealth Services List

In the CY 2003 PFS final rule with comment period (67 FR 79988), we established a regulatory process for adding services to or deleting services from the Medicare Telehealth Services List in accordance with section 1834(m)(4)(F)(ii) of the Act (42 CFR 410.78(f)). This process provides the public with an ongoing opportunity to submit requests for adding services, which are then reviewed by us and assigned to categories established through notice and comment rulemaking. Specifically, we assign any submitted request to add to the Medicare Telehealth Services List to one of the following two categories:

•

Category 1:

Services that are similar to professional consultations, office visits, and office psychiatry services that are currently on the Medicare Telehealth Services List. In reviewing these requests, we look for similarities between the requested and existing telehealth services for the roles of, and interactions among, the beneficiary, the physician (or other practitioner) at the distant site, and, if necessary, the telepresenter, a practitioner who is present with the beneficiary in the originating site. We also look for similarities in the telecommunications system used to deliver the service; for example, the use of interactive audio and video equipment.

•

Category 2:

Services that are not similar to those on the current Medicare Telehealth Services List. Our review of these requests includes an assessment of whether the service is accurately described by the corresponding code when furnished via telehealth and whether the use of a telecommunications system to furnish the service produces demonstrated clinical benefit to the patient. Submitted evidence should include both a description of relevant clinical studies that demonstrate the service furnished by telehealth to a Medicare beneficiary improves the diagnosis or treatment of an illness or injury or improves the functioning of a malformed body part, including dates and findings, and a list and copies of published peer reviewed articles relevant to the service when furnished via telehealth. Our evidentiary standard of clinical benefit does not include minor or incidental benefits. Some examples of other clinical benefits that we consider include the following:

• Ability to diagnose a medical condition in a patient population without access to clinically appropriate in-person diagnostic services.

• Treatment option for a patient population without access to clinically appropriate in-person treatment options.

• Reduced rate of complications.

• Decreased rate of subsequent diagnostic or therapeutic interventions (for example, due to reduced rate of recurrence of the disease process).

• Decreased number of future hospitalizations or physician visits.

• More rapid beneficial resolution of the disease process treatment.

• Decreased pain, bleeding, or other quantifiable signs or symptoms.

• Reduced recovery time.

•

Category 3:

In the CY 2021 PFS final rule (85 FR 84507), we created a third category of criteria for adding services to the Medicare Telehealth Services List on a temporary basis following the end of the public health emergency (PHE) for the COVID-19 pandemic. This new category describes services that were added to the Medicare Telehealth Services List during the PHE, for which there is likely to be clinical benefit when furnished via telehealth, but there is not yet sufficient evidence available to consider the services for permanent addition under the Category 1 or Category 2 criteria. Services added on a temporary, Category 3 basis will ultimately need to meet the criteria under Category 1 or 2 in order to be permanently added to the Medicare Telehealth Services List. To add specific services on a Category 3 basis, we conducted a clinical assessment to identify those services for which we could foresee a reasonable potential likelihood of clinical benefit when furnished via telehealth. We considered the following factors:

++ Whether, outside of the circumstances of the PHE for COVID-19, there are concerns for patient safety if the service is furnished as a telehealth service.

++ Whether, outside of the circumstances of the PHE for COVID-19, there are concerns about whether the provision of the service via telehealth is likely to jeopardize quality of care.

++ Whether all elements of the service could fully and effectively be performed by a remotely located clinician using two-way, audio/video telecommunications technology.

In the CY 2021 PFS final rule (85 FR 84507), we also temporarily added several services to the Medicare Telehealth Services List using the Category 3 criteria described above. In this proposed rule, we are considering additional requests to add services to the Medicare Telehealth Services List on a Category 3 basis using the previously described Category 3 criteria. The Medicare Telehealth Services List, including the additions described later in this section, is available on the CMS website at

https://www.cms.gov/Medicare/Medicare-General-Information/Telehealth/index.html

.

Beginning in CY 2019, we stated that for CY 2019 and onward, we intend to accept requests through February 10, consistent with the deadline for our receipt of code valuation recommendations from the RUC (83 FR 59491). For CY 2024, requests to add services to the Medicare Telehealth Services List must have been submitted and received by February 10, 2023. Each request to add a service to the Medicare Telehealth Services List must have included any supporting documentation the requester wishes us to consider as we review the request. Because we use the annual PFS rulemaking process as the vehicle to make changes to the Medicare Telehealth Services List, requesters are advised that any information submitted as part of a request is subject to public disclosure for this purpose. For more information on submitting a request in the future to add services to the Medicare Telehealth Services List, including where to mail these requests, see our website at

https://www.cms.gov/Medicare/Medicare-General-Information/Telehealth/index.html

.

b. Requests To Add Services to the Medicare Telehealth Services List for CY 2024

Under our current policy, we add services to the Medicare Telehealth Services List on a Category 1 basis when we determine that they are similar to services on the existing Medicare Telehealth Services List for the roles of, and interactions among, the beneficiary, physician (or other practitioner) at the distant site, and, if necessary, the telepresenter. As we stated in the CY 2012 PFS final rule with comment period (76 FR 73098), we believe that the Category 1 criteria not only

streamline our review process for publicly requested services that fall into this category, but also expedite our ability to identify codes for the Medicare Telehealth Services List that resemble those services already on the Medicare Telehealth Services List.

We also note that section 4113 of Division FF, Title IV, Subtitle A of the Consolidated Appropriations Act, 2023 (CAA, 2023) (Pub. L. 117-328, December 29, 2022) extends the telehealth policies enacted in the Consolidated Appropriations Act, 2022 (CAA, 2022) (Pub. L. 117-103, March 15, 2022) through December 31, 2024, if the PHE ends prior to that date, as discussed in section II.D.c. of this proposed rule.

We received several requests to permanently add various services to the Medicare Telehealth Services List effective for CY 2024. We found that none of the requests we received by the February 10th submission deadline met our Category 1 or Category 2 criteria for permanent addition to the Medicare Telehealth Services List. The requested services are listed in Table 9.

BILLING CODE 4120-01-P

EP07AU23.009

EP07AU23.010

BILLING CODE 4120-01-C

We remind interested parties that the criterion for adding services to the Medicare telehealth list under Category 1 is that the requested services are similar to professional consultations, office visits, and office psychiatry services that are currently on the Medicare Telehealth Services List, and that the criterion for adding services under Category 2 is that there is evidence of clinical benefit if provided as telehealth. As explained below, we find that none of the requested services listed in Table 9 1 met the Category 1 criterion.

(1) Cardiovascular Procedures

We received a request to permanently add CPT code 93793

(Anticoagulant management for a patient taking warfarin, must include review and interpretation of a new home, office, or lab international normalized ratio (INR) test result, patient instructions, dosage adjustment (as needed), and scheduling

of additional test(s), when performed)

) to the Medicare Telehealth Services List. We do not consider this service to be a Medicare telehealth service, because the service is not an inherently face-to-face service—a patient need not be present in order for the service to be furnished in its entirety. For example, in many instances, clinical staff will not change a patient's warfarin dosage as a result of the lab INR test result, and they may or may not confirm the need for a follow-up test via phone; either way there is no need for a face-to-face encounter with a practitioner. As we have explained in previous rulemaking (83 FR 59483), certain kinds of services that are furnished remotely using communications technology are not considered Medicare telehealth services and are not subject to the restrictions articulated in section 1834(m) of the Act. This is true for services that were routinely paid separately prior to the enactment of section 1834(m) of the Act and do not usually include patient interaction such as the remote interpretation of diagnostic tests. We do not consider CPT code 93793 to be a telehealth service under section 1834(m) of the Act or our regulation at § 410.78. Therefore, we are not proposing to add this service to the Medicare Telehealth Services List on a Category 1 basis.

(2) Cardiovascular and Pulmonary Rehab

We received multiple requests to permanently add the following CPT codes to the Medicare Telehealth Services List:

• 93797 (

Physician or other qualified health care professional services for outpatient cardiac rehabilitation; without continuous ECG monitoring (per session)

); and

• 94624

(Physician or other qualified health care professional services for outpatient pulmonary rehabilitation; without continuous oximetry monitoring (per session)).

In the CY 2022 PFS final rule (86 FR 65048), we explained that some services were added temporarily to the Medicare Telehealth Services List on an emergency basis to allow practitioners and beneficiaries to have access to medically necessary care while avoiding both risk for infection and further burdening healthcare settings during the PHE for COVID-19. In the same rule, we considered available evidence and noted that as evidence evolves on this subject matter, we welcome further discussions with interested parties on the topic. In subsequent cycles of annual rulemaking, we have continued conversations with interested parties that furnish, support, and use Cardiovascular and Pulmonary Rehabilitation services. In our CY 2022 PFS final rule (86 FR 65055), we acknowledged that commenters provided a number of studies on the safety and efficacy of these services when furnished via telehealth, and we added the codes to the list on a temporary, Category 3 basis.

We note that some evidence submissions and ongoing discussions with interested parties have focused on the clinical benefits of patients receiving these services in the home. We note that, while demonstrating the clinical benefits of services is important to our decision whether to add a service to the Medicare Telehealth Services List, there are other considerations when deciding whether to add codes to the list on a permanent basis. For example, while the CAA, 2023, does extend certain COVID-19 PHE flexibilities, including allowing the beneficiary's home to serve as an originating site, such flexibilities are only extended through the end of CY 2024. Under current law, beginning on January 1, 2025, the beneficiary's home can be an originating site only for Medicare telehealth services furnished for: (1) the diagnosis, evaluation, or treatment of a mental health disorder; or (2) a beneficiary with a diagnosed substance use disorder (SUD) for purposes of treatment of the SUD or a co-occurring mental health disorder; or (3) monthly ESRD-related clinical assessments furnished to a beneficiary who is receiving home dialysis, beginning January 1, 2025. Therefore, in the absence of further action by Congress, CPT codes 93797 and 94626 will not be able to be furnished via telehealth to a beneficiary in the home beginning January 1, 2025. As such, we are not proposing to include these services permanently on the Medicare Telehealth Services List on a Category 1 basis. We are instead proposing to continue to include these services on the Medicare Telehealth Services List through CY 2024. We would then remove CPT codes 93797 and 94626 from the Medicare Telehealth Services List for CY 2025.

(3) Deep Brain Stimulation

We received a request to permanently add the following CPT codes to the Medicare Telehealth Services List:

• 95970 (

Electronic analysis of implanted neurostimulator pulse generator/transmitter (e.g., contact group[s], interleaving, amplitude, pulse width, frequency [Hz], on/off cycling, burst, magnet mode, dose lockout, patient selectable parameters, responsive neurostimulation, detection algorithms, closed loop parameters, and passive parameters) by physician or other qualified health care professional; with brain, cranial nerve, spinal cord, peripheral nerve, or sacral nerve, neurostimulator pulse generator/transmitter, without programming

);

• 95983 (

Electronic analysis of implanted neurostimulator pulse generator/transmitter (e.g., contact group[s], interleaving, amplitude, pulse width, frequency [Hz], on/off cycling, burst, magnet mode, dose lockout, patient selectable parameters, responsive neurostimulation, detection algorithms, closed loop parameters, and passive parameters) by physician or other qualified health care professional; with brain neurostimulator pulse generator/transmitter programming, first 15 minutes face-to-face time with physician or other qualified health care professional

); and

• 95984 (

Electronic analysis of implanted neurostimulator pulse generator/transmitter (e.g., contact group[s], interleaving, amplitude, pulse width, frequency [Hz], on/off cycling, burst, magnet mode, dose lockout, patient selectable parameters, responsive neurostimulation, detection algorithms, closed loop parameters, and passive parameters) by physician or other qualified health care professional; with brain neurostimulator pulse generator/transmitter programming, each additional 15 minutes face-to-face time with physician or other qualified health care professional (List separately in addition to code for primary procedure)

).

In our CY 2023 proposed rule (85 FR 45891), we explained that these services do not meet the Category 1 criterion for permanent addition to the Medicare Telehealth Services List. Additionally, we discussed concerns about whether the full scope of service elements could be furnished via two-way, audio-video communication technology, particularly since it is unclear whether the connection between the implanted device and the analysis/calibration equipment can be done remotely. Additionally, we are concerned about the immediate safety of the patient if the calibration of the neurostimulator were done incorrectly or if some other problem occurred. However, we did include these services on the Medicare Telehealth Services List on a temporary basis during the PHE to allow additional time for additional information to be gathered and presented. Based on this information, we believe there is some possible clinical benefit for these services when furnished via telehealth; however, there is not yet sufficient evidence available to consider the services for permanent addition under

the Category 2 criterion. We are proposing to keep these services on the Medicare Telehealth Services List for CY 2024. We would consider additional evidence in future rulemaking to determine whether to add the services to the Medicare Telehealth Services List on a permanent basis.

(4) Therapy

We received requests to add Therapy Procedures: CPT codes 97110, 97112, 97116; Physical Therapy Evaluations: CPT codes 97161-97164; Therapy Personal Care services: CPT code 97530; and Therapy Tests and Measurements services: CPT codes 97750, 97763 and Biofeedback: 90901, to the Medicare Telehealth Services List on a Category 1 or 2 basis. We have considered these codes over several years, in multiple cycles of annual rulemaking. In the CY 2017 final rule (81 FR 80198), we first assessed a request to add CPT codes 97110, 97112, and 97116 (the therapy codes) to the Medicare Telehealth Services List. We did not add the codes to the Medicare Telehealth Services List at the time, because there was no emergency waiver providing an exception to the requirements under section 1834(m)(4)(E) of the Act, and physical therapists, occupational therapists, and speech-language pathologists were not eligible telehealth practitioners. In the CY 2018 final rule (82 FR 53008 and 53009), we reiterated our initial assessment that the codes were not appropriate to add to the Medicare Telehealth Services List, because the majority of the therapy codes listed above are furnished over 90 percent of the time by therapy professionals who are not included on the list of distant site practitioners who can furnish telehealth services at section 1834(m)(4)(E) of the Act. We stated that we believed that adding therapy services to the Medicare Telehealth Services List could result in confusion about who is authorized to furnish and bill for these services when furnished via telehealth (82 FR 53009).

Section 3703 of Division A, Title III, Subtitle D of the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) (Pub. L. 116-136, enacted March 27, 2020) amended section 1135(b)(8) of the Act to give the Secretary emergency authorities to waive or modify Medicare telehealth payment requirements under section 1834(m) of the Act during the PHE for COVID-19. Using this authority, CMS issued a set of emergency waivers that included waiving the restrictions in section 1834(m)(4)(E) of the Act on the types of practitioners who may furnish telehealth services. This allowed for therapy professionals to furnish telehealth services for the duration of the PHE. In the CY 2022 final rule (86 FR 65051), we reviewed another round of submissions requesting that CMS add therapy codes to the Medicare Telehealth Services List, and we again determined that these codes did not meet the Category 1 criterion for addition to the list. In the CY 2023 PFS final rule (87 FR 69451), through our review of evidence that was submitted by interested parties in support of adding these services to the Medicare Telehealth Services List on a Category 2 basis, we concluded that there was not sufficient information to determine whether all of the necessary elements of these services could be furnished remotely.

In reviewing this year's request, the evidence submission includes evidence similar to what was submitted last year, with a few new additions suggesting that some elements of the individual services may have clinical benefit when furnished via telehealth, but not resolving uncertainty about whether other elements of the services can be fully furnished remotely via telehealth. The evidence submitted also suggests that receiving therapy services via telehealth in the home may offer some practical benefits, such as use of actual stairs in therapy exercise instead of artificial stairs, or meal preparation instructions focused on available kitchen tools and equipment. However, the evidence submitted for review leaves open questions as to whether such differences in the setting of care translate to a clinical benefit that is more than minor or incidental, in typical circumstances for the typical population of beneficiaries who may receive therapy services via telehealth.

We note that for any submission, including submissions received for these therapy services, we consider all elements of a service as described by a particular HCPCS code and apply our review criteria to the specific code. While some submitted information may focus on an individual service within one specific clinical scenario, and furnished within one specific individual model of care delivery, that information may not be generalizable to the varied settings and scenarios under which the service would be typically furnished via telehealth. We reiterate that available evidence should give a reasonable degree of certainty that all elements of the service could fully and effectively be furnished by a remotely-located clinician using two-way, audio/video telecommunications technology.

Based on the evidence we reviewed, we continue to question whether the findings from therapy studies that focused on a specific clinical issue for a narrow population (for example, joint replacement of a specific joint) translate to clinical benefit for some or many of the various other clinical issues that would typically be addressed when therapists furnish therapy services via telehealth to beneficiaries. Despite the evidence, we are still uncertain as to whether all of the elements of a therapy service could typically be furnished through use of only real-time, two-way audio/video communications technology. Because we continue to have these questions, we are not proposing to add these services to the Medicare Telehealth Services List on a Category 1 or 2 basis, for the same reasons described in our CY 2018 through CY 2023 rulemaking cycles. Also, we continue to believe that adding these therapy services to the Medicare Telehealth Services List permanently would potentially generate confusion. As discussed in last year's final rule, we note that we do not have authority to expand the list of eligible Medicare telehealth practitioners to include therapists (PTs, OTs, or SLPs) after CY 2024 (87 FR 69449 through 69451). We note that the CAA, 2023, did not permanently change the list of practitioners who can furnish and bill for telehealth services; rather, the CAA, 2023, extended the current telehealth flexibilities through the end of CY 2024. That said, we are proposing to keep these therapy services on the Medicare Telehealth Services List until the end of CY 2024. We will consider any further action with regard to these codes in future rulemaking.

(5) Hospital Care, Emergency Department and Hospital

We received a request to permanently add the following CPT codes to the Medicare Telehealth Services List:

• 99221 (

Initial hospital inpatient or observation care, per day, for the evaluation and management of a patient, which requires a medically appropriate history and/or examination and straightforward or low level medical decision making. When using total time on the date of the encounter for code selection, 40 minutes must be met or exceeded.

)

• 99222 (

Initial hospital inpatient or observation care, per day, for the evaluation and management of a patient, which requires a medically appropriate history and/or examination and moderate level of medical decision making. When using total time on the date of the

encounter for code selection, 55 minutes must be met or exceeded.

)

• 99223 (

Initial hospital inpatient or observation care, per day, for the evaluation and management of a patient, which requires a medically appropriate history and/or examination and moderate level of medical decision making. When using total time on the date of the encounter for code selection, 55 minutes must be met or exceeded.

)

• 99234 (

Hospital inpatient or observation care, for the evaluation and management of a patient including admission and discharge on the same date, which requires a medically appropriate history and/or examination and straightforward or low level of medical decision making. When using total time on the date of the encounter for code selection, 45 minutes must be met or exceeded.

)

• 99235 (

Hospital inpatient or observation care, for the evaluation and management of a patient including admission and discharge on the same date, which requires a medically appropriate history and/or examination and moderate level of medical decision making. When using total time on the date of the encounter for code selection, 70 minutes must be met or exceeded.

)

• 99236 (

Hospital inpatient or observation care, for the evaluation and management of a patient including admission and discharge on the same date, which requires a medically appropriate history and/or examination and high level of medical decision making. When using total time on the date of the encounter for code selection, 85 minutes must be met or exceeded.

)

• 99238 (

Hospital inpatient or observation discharge day management; 30 minutes or less on the date of the encounter

)

• 99239 (

Hospital inpatient or observation discharge day management; more than 30 minutes on the date of the encounter

)

• 99281 (

Emergency department visit for the evaluation and management of a patient that may not require the presence of a physician or other qualified health care professional

)

• 99282 (

Emergency department visit for the evaluation and management of a patient, which requires a medically appropriate history and/or examination and straightforward medical decision making

)

• 99283 (

Emergency department visit for the evaluation and management of a p

This text is long and has been trimmed here. Open the source document for the complete record.