• Budget Neutrality Undercuts Payment in 2022 Proposed MPFS

    AAFP Analyzes New Medicare Physician Fee Schedule, Pushes for Fix

    July 28, 2021, 8:51 a.m. News Staff — A possible reduction in physician payment toplines a new AAFP summary for members of the proposed rule for the 2022 Medicare physician fee schedule, which CMS released July 23 and has ignited sharp congressional advocacy by the Academy and a broad coalition of medical groups.

    physician with calculator

    The AAFP summary warns that according to the AMA, a 1.6% reduction in allowed charges for family medicine could result if next year’s fee schedule goes into effect as proposed without congressional intervention. Absent such a legislative remedy, “ongoing structural problems with the MPFS … could result in many beneficiaries losing timely access to essential health care services,” said the Academy and more than 100 other medical organizations in a July 23 letter to House and Senate leaders.

    Comments on the MPFS are due to CMS by Sept. 13. The agency will issue a final rule around Nov. 1, and it will take effect on Jan. 1, 2022. Ahead of the Academy’s detailed formal response to the proposed fee schedule, the five-page summary gives members an overview of its potential impacts.


    The 2022 proposed conversion factor — the number multiplied by the relative value of each code in the fee schedule to determine the Medicare payment rate — is $33.58, which is 3.75% lower than the 2021 conversion factor of $34.89.

    “This reduction can be attributed to the expiration of a 3.75% increase in the 2021 conversion factor, which Congress applied via legislation in December 2020,” the summary says. Before lawmakers stepped in, however, the 2021 conversion factor reflected a reduction of more than 10% from 2020’s rate, owing to a federally mandated budget-neutrality requirement working against the long-planned boost to evaluation and management coding for which the Academy had long advocated.

    Vaccine Administration

    Answering calls by the Academy, CMS acknowledges in the fee schedule that Medicare payment for vaccine administration services is insufficient. “The agency seeks detailed comments on the cost of vaccine supplies and administration and indicates it may use this information to create a new, more sustainable payment methodology for vaccine administration services,” the summary notes.

    Story Highlights

    Appropriate Use Criteria for Advanced Diagnostic Imaging

    Following steady AAFP advocacy, CMS proposes to delay full implementation of the Appropriate Use Criteria program until Jan. 1, 2023, or Jan. 1 of the year after the COVID-19 public health emergency ends, whichever is later. This delay could give Congress a chance to repeal the program, an outcome for which the Academy also has lobbied.


    CMS proposes to retain all services previously added to the Medicare telehealth services list on a temporary basis until the end of calendar year 2023. To implement the telehealth provisions in the Consolidated Appropriations Act of 2021, the proposed rule also would, after the end of the COVID-19 public health emergency (which HHS on July 20 extended for another 90 days),

    • remove geographic restrictions for telehealth services provided to diagnose, evaluate or treat a mental health disorder;
    • add a patient’s home as a permissible originating site for telehealth services for the diagnosis, evaluation or treatment of a mental health disorder; and
    • require, as a condition of payment for mental health telehealth services, that the billing practitioner must have furnished an in-person service to the beneficiary within the six-month period before the date of the telehealth service.

    Audio-only telehealth services would be allowed for the diagnosis, evaluation or treatment of a mental health disorder when

    • the originating site of the visit is the patient’s home;
    • real-time audio-video technology is available but the beneficiary lacks access, capacity or willingness to use it; and
    • an in-person service is furnished within six months of the audio-only service.

    CMS proposes to permanently adopt coding and payment for HCPCS code G2252, covering longer virtual check-ins.

    Valuation of Specific Codes

    Among proposed new or revised valuations of CPT and HCPCS codes, the summary says, “of most interest to family physicians will be CMS’s proposals related to the codes for chronic care management and principal care management.” In those cases, the work relative value units and direct practice expense inputs recommended by the Relative Value Scale Update Committee for all these codes would be accepted — meaning “an increase in the work RVUs for each of the existing CCM codes and one of the two PCM codes, which will be converting from HCPCS codes to CPT codes.”

    Evaluation and Management Visits

    The Academy’s summary notes a number of CMS policy changes proposed across three areas and pays particular attention to guidance related to visits split or shared by a physician and a non-physician clinician working in the same group.

    Among other updates, the 2022 MPFS would allow only the physician or non-physician clinician who performs the substantive portion of the split or shared visit to bill for the visit; “substantive portion” would be defined as more than half of the total time spent by the professional performing the visit. The rule would create a modifier to describe split or shared visits and to require that the modifier be appended to claims for such visits, regardless of which professional bills for the visit.

    Medicare Shared Savings Program

    In line with the AAFP’s advice, CMS proposes to delay a previously finalized overhaul of quality reporting for Medicare Shared Savings Program accountable care organizations. CMS plans to extend the CMS Web Interface reporting option for two years and phase in the quality reporting changes over a longer period.

    For the 2022 performance year, the rule as written would allow MSSP accountable care organizations to report the 10 CMS Web Interface measures or the three Alternative Payment Model Performance Pathway electronic clinical quality measure/Merit-based Incentive Payment System CQMs. For the 2023 performance year, ACOs would be required to report either the 10 CMS Web Interface measures and at least one APP eCQM/MIPS CQM or report the three APP eCQM/MIPS CQMs. Beginning with the 2024 performance period and in subsequent years, ACOs will be required to report the three APP eCQM/MIPS CQMs.

    The MPFS proposes freezing the quality performance standard at the 30th percentile of MIPS Quality Performance Category scores for an additional year. In performance year 2024, CMS would raise the quality performance standard in conjunction with the transition to reporting the three eCQM/MIPS CQMs by all ACOs and increase the performance standard to the 40th percentile.

    The proposed rule adds several codes to the list of primary care services used to assign patients to the ACO and continues the use of CPT codes 99441-99445 in the list of primary care services until they are no longer payable under the MPFS. CMS also plans to lower the repayment mechanism amounts and to modify the methodology used for the annual repayment amount recalculation to use more recent data.

    Quality Payment Program

    The fee schedule would make several changes to the traditional MIPS track of the QPP. The performance threshold would be 75 points in 2022, and the exceptional performance threshold would be 89 points. The cost category would be weighted at 30% of the MIPS score, and the rule would add five new episode-based cost measures, including two for chronic conditions. The quality, promoting interoperability and improvement activities categories would be weighted at 30%, 25% and 15% percent, respectively.

    The proposed rule lays out a transition timeline for replacing traditional MIPS reporting with the MIPS Value Pathways program. The MVP track will begin in 2023, with the goal of providing a more focused reporting option. The most relevant MVP for FPs among those proposed for 2023 is one for chronic care management. CMS plans to sunset traditional MIPS in 2027.

    Academy Urges Correction

    To avoid “steep cuts” in payment to health care practitioners across the range of specialties, the Academy and scores of co-signatories called on Congress in their July 23 letter to maintain this year’s 3.75% conversion-factor increase through 2023.

    More than 100 medical and health care societies, including the AMA and the Association of American Medical Colleges, signed the letter. It was sent to Senate Majority Leader Chuck Schumer, D-N.Y.; Senate Minority Leader Mitch McConnell, R-Ky.; House Speaker Nancy Pelosi, D-Calif.; and House Minority Leader Kevin McCarthy, R-Calif.

    Medicare payments have been “under pressure from CMS’ anti-inflationary payment policies for more than 20 years,” the groups wrote, with the agency’s annual updates to the conversion factor failing to keep pace with inflation. “The result is that the CF today is only about 50% of what it would have been if it had been indexed to general inflation starting in 1998.” At the same time, the letter adds, the cost of running a medical practice has increased by 37% since 2001 — meaning a decline in physician pay of some 22% over that span when practice costs are adjusted for inflation.

    “Moving forward, Congress must recognize the need for critical reforms to the MPFS system, including addressing the budget-neutrality requirement, which can lead to arbitrary reductions to reimbursement unrelated to the cost of providing care,” the letter said. Without such change, patients suffer as clinicians “adjust to unpredictable and excessive reductions to reimbursement that inhibit their ability to ensure beneficiaries have access to the care they need — services that improve outcomes and lower costs.”