Proposed CY 2024 Medicare Physician Fee Schedule Extends Many Telehealth Flexibilities Through 2024

Health Highlights

On July 13, the Centers for Medicare & Medicaid Services (CMS) released its annual proposed rule updating the Medicare Physician Fee Schedule (MPFS) for calendar year (CY) 2024, which includes various proposed changes related to the provision of telehealth, including implementing telehealth provisions included in the Consolidated Appropriations Act, 2023, (CAA 2023) and extending many telehealth flexibilities through the end of CY 2024. CMS also proposed changes to remote monitoring services and is seeking guidance on digital therapies. This newsletter summarizes select telehealth and remote monitoring provisions.

Changes to the Medicare Telehealth Services List Structure and Updates Process. Prior to the COVID-19 public health emergency (PHE), CMS evaluated changes to the Medicare Telehealth Services List (the List) through an annual rulemaking process. Through this process, CMS considered whether a service met one of two criteria for permanent inclusion on the List. Category 1 services are similar to professional consultations, office visits and office psychiatry services that are currently on the List. Category 2 services are not similar to those on the current List—the primary criteria CMS uses in evaluating these services are (a) whether the service is accurately described by the corresponding code when delivered via telehealth and (b) whether the use of a telecommunications system to deliver the service produces demonstrated clinical benefit to the patient. During the PHE, CMS created a third category (Category 3), which allows for temporary coverage while further evidence is developed and the service is considered for permanent (Category 1 or 2) coverage.

The current List structure and updates process have proved cumbersome and confusing to stakeholders, and so CMS is proposing to simplify the List into two categories—permanent and provisional—beginning in calendar year (CY) 2025. CMS proposes the following steps for analyzing changes to the List going forward:

  • Step 1: Determine whether the service is separately payable under the MPFS.
  • Step 2: Determine whether the service is subject to the provisions of Section 1834(m) of the Social Security Act—in effect, whether at least some elements of the service, when delivered via telehealth, are a substitute for an in-person encounter, and all of those face-to-face elements of the service are furnished using an interactive telecommunications system.
  • Step 3: Review the elements of the service as described by the Healthcare Common Procedure Coding System (HCPCS) code and determine whether each of them is capable of being furnished using an interactive telecommunications system.
  • Step 4: Consider whether the service elements of the requested service map to the service elements of a service on the List that has a permanent status described in previous final rulemaking.
  • Step 5: Consider whether there is evidence of clinical benefit analogous to the clinical benefit of the in-person service when the patient who is located at a telehealth originating site receives a service furnished by a physician or practitioner located at a distant site using an interactive telecommunications system.

For 2024, CMS proposes to redesignate Category 1 and Category 2 codes to the new permanent category and “temporary Category 2” and Category 3 codes to the new provisional category. CMS does not propose any specific timeline for considering changes from provisional to permanent status—changes in status will be evaluated during the annual updates process.

Additions to the Medicare Telehealth Services List. Each year, CMS reviews requests for changes to the List. This year, CMS is proposing to add a series of health and well-being coaching services to the List on a temporary basis for CY 2024. In addition, CMS is proposing to add HCPCS code GXXX5, screening for social determinants of health, to the List on a permanent basis, contingent on finalizing the service code definition. There were several other requests for additions to the List on a permanent basis, all of which were rejected by CMS in the proposed rule because they did not meet CMS’ current criteria, described above.

CMS proposes to make a series of temporary policy extensions through CY 2024. CMS is proposing to implement several provisions of the CAA 2023, which would extend the following policies through CY 2024 on a temporary basis:

  • In-Person Requirements for Mental Health Services: Delaying the in-person visit requirement for telemental health services furnished by rural health clinics (RHCs) and federally qualified health centers (FQHCs)
  • Originating Site and Geographic Restrictions: Expanding the scope of telehealth originating sites for services furnished via telehealth to include any site in the United States where the beneficiary is located at the time of the telehealth service, including an individual’s home
  • Eligible Providers: Expanding the definition of telehealth practitioners to include qualified occupational therapists, qualified physical therapists, qualified speech-language pathologists and qualified audiologists (and adding MFTs and MHCs to the list of eligible providers)
  • Audio-Only Services: Continuing coverage of certain audio-only telehealth services on the List

In addition, CMS is proposing to extend the following telehealth flexibilities through CY 2024:

  • Frequency Limits: Removing frequency limitations for certain subsequent inpatient visits, subsequent nursing facility visits and critical care consultation services
  • Direct Supervision of Clinical Staff: Continuing to allow for “direct supervision” to permit the presence and “immediate availability” of the supervising practitioner through real-time audio and visual interactive telecommunications (pre-PHE “direct supervision” could only be met via in-person “immediate availability”) (CMS is seeking comment on whether to extend the flexibilities related to direct supervision and the virtual presence of teaching physicians beyond CY 2024)
  • Telehealth in Teaching Settings: Continuing to allow teaching physicians to have a virtual presence in all teaching settings, but only in clinical instances when the service is furnished virtually (for example, a three-way telehealth visit with all parties in separate locations)
  • Outpatient Therapy, Diabetes Self-Management Training and Medical Nutrition Therapy: Continuing to allow outpatient therapy (physical therapy, occupational therapy, speech-language pathology), diabetes self-management training and medical nutrition therapy to be provided via telehealth when delivered by institutional staff
  • Telehealth for Opioid Treatment Providers: Allowing for periodic assessments to be furnished via audio-only communications technology when video is not available to the extent that use of audio-only communications technology is permitted under the applicable Substance Abuse and Mental Health Services Administration (SAMHSA) and Drug Enforcement Administration (DEA) requirements at the time the service is furnished and provided that all other applicable requirements are met

Changes to Payment by Place of Service for Medicare Telehealth Services. When a physician or practitioner submits a claim for their professional services, including claims for telehealth services, they include a place of service (POS) code that is used to determine whether a service is paid using the facility or non-facility rate. Under the MPFS, there are two payment rates for many physicians’ services: the facility rate, which applies when the service is furnished in a hospital or skilled nursing facility setting, and the non-facility rate, which applies when the service is furnished in an office or other setting. The facility rate is typically lower than the non-facility rate, but there is a separate payment to the facility (sometimes called a facility fee), in addition to the payment to the physician, to pay for facility costs (clinical staff, supplies, equipment, overhead).

CMS has evolved its guidance on the use of modifiers and POS codes for telehealth services over the past several years and during the PHE. Starting in CY 2023, CMS required that telehealth claims be billed with one of two POS indicators:

  • POS “02”—Telehealth Provided Other Than in Patient’s Home
  • POS “10”—Telehealth Provided in Patient’s Home

Beginning in CY 2024, CMS is proposing that claims billed with POS 02 be paid at the facility rate and claims billed with POS 10 be paid at the non-facility rate. CMS explains that during the PHE, especially for behavioral health services, practice patterns evolved such that providers often see patients both in person and virtually. As a result, these practitioners continue to maintain their office presence even as a significant proportion of their practice’s utilization may consist of telehealth visits. Therefore, CMS concludes, the practice expenses for these services are more accurately reflected by the non-facility rate. Claims billed with POS 02 will be paid at the facility rate under the logic that those services will be furnished in originating sites that were typical prior to the PHE and the facility rate more accurately reflects the practice expenses of these telehealth services.

Remote Physiologic and Therapeutic Monitoring. Currently, remote physiologic monitoring (RPM) and remote therapeutic monitoring (RTM) codes are not stand-alone billable visits in RHCs and FQHCs. When these services are furnished incident to an RHC or FQHC visit, payment is included in the RHC’s all-inclusive rate (AIR) subject to a payment limit or per-visit payment under the FQHC prospective payment system (PPS), which is the lesser of the PPS rate or the FQHC’s actual charges. CMS proposes that starting in CY 2024, RPM and RTM services will be separately payable to RHCs and FQHCs using the general care management code, HCPCS code G0511.

In addition, CMS is proposing that RTM services be allowed to be furnished under general rather than direct supervision when provided by occupational therapists (OTs) or physical therapists (PTs) in private practice. Previously, these services, when provided by an occupational or physical therapy assistant, were subject to direct supervision, which required the PT or OT to be “immediately available.” CMS is seeking comment on whether to allow general supervision for a broader set of services provided by OTs and PTs.

Finally, CMS confirmed and clarified the following policies related to RPM and RTM:

  • RPM and RTM services can only be furnished to an established patient.
  • Sixteen days of data are required within a given 30-day period for the relevant RPM and RTM codes.
  • RPM and RTM cannot both be billed for the same patient in the same month, though either RPM or RTM can generally be billed with other care management services as long as time or effort is not double-counted.
  • RPM or RTM (but not both) can be furnished separately from services covered under payment for a global period as long as time and effort requirements are met.

Request for Information on Digital Therapies. CMS has, over time, expanded coverage for a range of digital therapies, including RPM and RTM. CMS is seeking information on how remote monitoring services are used in clinical practice and experience with coding and payment policies for these codes, with a focus on digital cognitive behavioral therapy (CBT). Specifically, CMS asks several pages of questions related to the following topics:

  • How practitioners would identify which patients would benefit from digital therapeutics and how practitioners would monitor their effectiveness
  • Which practitioners and auxiliary staff are involved in furnishing remote monitoring and digital therapy services
  • Standards that have been developed to ensure the privacy and security of digital therapies
  • Effective models for the distribution or delivery of digital therapies and best practices to support and train patients
  • How data are collected and maintained for recordkeeping and care coordination
  • How to handle situations in which one patient may be receiving concurrent digital services
  • The pros and cons of generic versus specific device supply codes for digital therapies
  • What evidence CMS should consider when determining whether digital therapies are reasonable and necessary
  • What aspects of digital therapies for behavioral health should be considered when determining whether they fit into a Medicare benefit category, and which category should be used
  • If CMS determines that digital therapies fit within an existing Medicare benefit category, what aspects of digital CBT services should be considered when determining potential payment (including whether these services are furnished incident to or independent of a visit)
  • Barriers to accessing digital CBT for underserved populations and strategies to address these access barriers

In prior guidance, CMS indicated that digital therapies did not have a statutorily defined Medicare benefit category (except for certain digital therapies with a hardware component that met the definition of durable medical equipment), so it is notable that CMS now is seeking comment on how it should view digital therapies vis-à-vis benefit category determinations.



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