On November 1, 2022, the Centers for Medicare & Medicaid Services (CMS) released the 2023 Physician Fee Schedule (PFS) Final Rule. CMS releases a PFS annually to make changes to policy and reimbursement federal health care. Changes to FSPs often spill over to the private sector, as private payers typically consult with FSPs when evaluating their own payment terms and policies. The new final rule, like its annual predecessors, addresses wide-ranging issues across the Medicare program, including an overall reduction in provider fees and changed policies relating to assessment and management visits and in many other areas. The final rule includes several coverage and payment rules in three areas of particular interest to our customers: telehealth services, remote digital therapy monitoring (RTM), and behavioral health services. The final rule also addresses changes to be expected after the expiration of the public health emergency (PHE) COVID-19, which was recently extended until January 11, 2023. Below, we discuss some notable developments in each of these areas.
As part of the US Department of Health and Human Services’ strategy to combat PHE underway since 2020, CMS has expanded the use and reimbursement of Medicare telehealth services. CMS has done this primarily through “flexibilities”: temporary waivers of narrow restrictions that otherwise apply to the provision and payment of Medicare telehealth. Flexibilities that allow telehealth services to be provided in any geographic area and at any originating site (including the beneficiary’s home) are critical to the expansion of telehealth during the PHE; allow certain services to be provided via audio-only telecommunications systems; and enabling physiotherapists, occupational therapists, speech language pathologists and audiologists to provide telehealth services.
Nearly three years after PHE began, the final rule paves the way for the reversal of many current flexibilities in a way that will temporarily confine and limit the scope of Medicare telehealth in the future. The final rule requires patients to be physically present again at an originating site – an office, clinic or medical facility in a rural area – for most telehealth services. Medicare reimbursement for telehealth visits provided by physical therapists, occupational therapists, speech language pathologists, and audiologists will no longer be permitted. The only Medicare services that will be allowed to be audio-only services will be mental health telehealth services. The final rule establishes a deadline for the withdrawal of these flexibilities after 151 days following the declared end of the PHE.
The final rule leaves open the possibility that some flexibilities may eventually be adopted on a permanent basis. Some important flexibilities under the PHE will be allowed to extend beyond the end of the PHE to allow more time for the collection of data that can support their inclusion as permanent additions to Medicare telehealth services. . For example, telehealth services requiring the “direct supervision” of a physician (i.e. virtual presence) via real-time interactive audio-video technology. CMS states that it will continue to allow direct supervision by virtual presence until at least the end of 2023, or any subsequent calendar year in which the PHE ends CMS says the information and evidence on virtual supervision, which it continues to gather, can guide future rulemaking in this domain.
Therapeutic telemonitoring (RTM)
RTM is designed for remote management of patient treatment using medical devices that collect non-physiological data. Data for key treatment-related endpoints such as treatment/medication compliance, treatment/medication response and pain level can be collected and billed remotely under the RTM codes that CMS has commissioned at beginning of 2022. (RTM should not be confused with remote patient monitoring (RPM) which collects physiological data.) The final rule establishes a new RTM device procurement code for cognitive behavioral therapy monitoring, opening the door to other RTM use cases. Perhaps most notable about the Final Rule’s treatment of the GTR is how it largely relaxes monitoring requirements. Physicians are currently required to directly oversee billed “incident” TMR as part of physician registration, in which clinical staff use medical device data to manage and monitor patient health. From January 2023, physicians would no longer need to be in the same building as clinical staff to meet the “general supervision” requirement and could supervise virtually. The final rule declined to undertake certain proposed changes that were to facilitate Medicare’s expansion in this area. CMS has not elected to introduce a generic state/system-independent RTM device provisioning code nor to establish four new G-codes of the Healthcare Common Procedures Coding System (HCPCS) that providers could use when billing for the provision of RTM services by ancillary personnel.
Behavioral health services
In its Behavioral Health Strategy 2022, CMS pledged to “improve access to high-quality, affordable, people-centred behavioral health care, and to achieve parity in access, coverage and the quality of physical and mental health services, including care made possible by telehealth and technology”. .”
The final rule acts on the commitment by establishing multiple provisions expanding access to behavioral health care. From January 2023, marriage and family therapists, licensed professional counselors and other types of ancillary behavioral health care providers will be able to provide “incident to” services to patients under the general supervision of a physician or a non-physician practitioner, rather than under direct supervision. As explained in the previous section, this would allow ancillary providers to provide services to patients without the supervising practitioner being physically present to administer immediate assistance. However, the general supervision standard still requires that services be performed under the “general direction and control” of the supervisor (see, for example, 42 CFR § 410.32(b)(3)(i)). Supervising practitioners are still responsible for training ancillary providers performing the procedure and ensuring the quality and reliability of services rendered.
CMS has also finalized reimbursement for licensed clinical psychologists and clinical social workers as part of an integrated care team under code G0323. The new code requires “at least 20 minutes of clinical psychologist or clinical social worker time, per calendar month, with the following required elements: initial assessment or follow-up follow-up, including the use of applicable validated rating scales ; behavioral health care planning in relation to behavioral/psychiatric health problems…”. The requirements state that, to be reimbursed, services must involve coordination of treatment with and/or referral to physicians and practitioners authorized by law to prescribe medication, provide emergency services and advice and/or or a psychiatric consultation.
The final rule contains significant changes for telehealth, TMR, and behavioral health providers. These include new codes that will enable additional use cases and relaxed oversight requirements which, in the case of TMR and behavioral health, should expand the possibilities for incident delivery to services by clinical staff. and ancillary providers. The final rule seems to anticipate further growth in these areas and aims to facilitate it. As far as telehealth is concerned, the final rule largely provides for a gradual reduction after the end of the PHE. The final rule also leaves open the possibility that certain aspects of the temporary expansion of telehealth under the PHE, such as virtual supervision, may be established permanently by future regulation. Beginning in January 2023, the prospects for telehealth, TMR, and behavioral health businesses under Medicare and beyond will be significantly affected by the provisions of the final rule.
Our July comments on the proposed 2023 Medicare Physician Fee Schedule Rule can be found here.
The final rule can be accessed via this link.
CMS has prepared a helpful summary of highlights from the final rule, which can be viewed here.
For more information, please contact Jamie Ravitz, David Hoffmeister, Georgia Ravitz, Eva Yin, Paul Gadiock, Jeff Weinstein, or any other member of Wilson Sonsini’s FDA Regulatory, Health, and Consumer Products practice.
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