On November 1st, the Centers for Medicare & Medicaid Services (CMS) released the Medicare Physician Fee Schedule (MPFS) final rule for CY 2023 (CMS-1770-F). This rule updates payment policies and payment rates for Part B services furnished under the MPFS, as well as makes changes to the Quality Payment Program (QPP). The rule in its entirety, the addenda, including Addendum B, which lists the final RVUs for each CPT code can be found here.

In this final rule, CMS outlines several significant policy changes and includes responses to several requests for information (RFI). The following summarizes the major policies finalized for 2023. Note that the page numbers listed in this document refer to the display copy of the final rule.

Update: On December 22nd, Congress voted to pass the Consolidated Appropriations Act of 2023, or the Omnibus bill, which mitigates some of the cuts to physician payment previously set in the 2023 MPFS. The Omnibus bill reduces the cut to Medicare physician payment by reducing the conversion factor by 2% rather than the 4.5% outlined in the 2023 MPFS. The new impacts of these cuts can be viewed at the following links. Information on the previously finalized CY 2023 MPFS is below.

• Updated CY 2023 MPFS Impacts on Urology Codes Compared with CY 2022 Rates (Facility and Non-Facility Rates)
• Updated CY 2023 MPFS Impacts on Evaluation & Management Codes Compared with CY 2022 Rates (Facility and Non-Facility Rates)

REGULATORY IMPACT ANALYSIS – P. 2248

Highlight: Medicare payments for physician services set for a 2.5% decrease.

Conversion Factor for 2023
The new conversion factor for 2023 is set to decrease by approximately 2.5% from $34.61 to $33.89 as outlined in the Omnibus bill. This update is the result of advocacy by specialty societies, including the AUA. The previously finalized conversion factor in the 2023 MPFS was $33.06 and was a 4.5% decrease from the 2022 conversion factor.

Specialty Level Impact Final
The impact to group practices and the individual physicians, however, varies based on practice type and the mix of patients and services provided to those patients. Note that the Impact Table found on page 2265 in the final rule does not reflect the 3% cut described above. It only includes impacts of rate-setting changes and changes to RVUs within the budget neutral system. The table for the Estimated Specialty Level Impacts is excerpted from Table 148 and depicts some of the specialties with the greatest impact both positive and negative. We have included other specialties in this table so that one can see the impact across specialties.

• Final CY 2023 MPFS Impacts on Urology Codes Compared with CY 2022 Rates (Facility and Non-Facility Rates)
• Final CY 2023 MPFS Impacts on Evaluation & Management Codes Compared with CY 2022 Rates (Facility and Non-Facility Rates)

Estimated Specialty Level Impact for 2023 (p. 2265)

Specialty	Medicare Allowed Charges (millions)	Impact Work RVU	Impact PE RVU	Impact MP RVU	Combined Impact
Infectious Diseases	$590	4%	0%	0%	+4%
Internal Medicine	$9,881	2%	0%	0%	+2%
Endocrinology	$534	0%	0%	0%	0%
Gastroenterology	$1,595	0%	-1%	0%	-1%
Obstetrics/Gynecology	$596	-1%	0%	0%	-1%
Urology	$1,758	-1%	-1%	0%	-1%
Allergy/Immunology	$233	0%	-1%	0%	-2%
Vascular Surgery	$1,104	0%	-3%	0%	-3%
Interventional Radiology	$467	-1%	-3%	0%	-4%

EVALUATION AND MANAGEMENT (E/M) VISITS – P. 498

Highlight: CMS finalizes the RUC recommended values for inpatient and observation E/M services. Creates new G codes for prolonged services.

Several years ago, the American Medical Association (AMA) set out to revise the entire CPT® evaluation and management (E/M) code set with the culmination of that effort included in this rulemaking cycle. Revised E/M codes outlined in this rule include inpatient and observation visits, emergency department (ED) visits, nursing facility visits, domiciliary or rest home visits, home visits, and cognitive impairment assessment. In the CY 2020 and 2021 rules, CMS implemented changes to the outpatient E/M services.

CMS finalized nearly all the revisions for CPT^® codes used to report other E/M visits including inpatient and observation services. The changes include revisions to the documentation guidelines and to the descriptors for these services, which will now mirror those previously made to the outpatient E/M services. Inpatient E/M code level may be chosen based on time or medical decision making, and like the outpatient E/M codes, using the history and exam to determine code level has been eliminated, but should be performed when medically necessary.

Valuation of Hospital Inpatient or Observation Care Services – p. 476

As noted previously, CMS has accepted the CPT Panel revisions for codes used to report inpatient and observation care services. Additionally, the agency has finalized without revision, the RUC recommended work RVUs and associated times for initial and subsequent inpatient/observation same day services. Current and the final 2023 work RVUs are depicted in the table below.
2022 vs 2023 Work RVUs Inpatient/Observation E/M Services - p. 477

2022 vs 2023 Work RVUs Inpatient/Observation E/M Services - p. 477

CPT Code	2022 wRVU	2023 wRVU	Percent Change 2022-2023
99221 – initial inpatient, low MDM	1.92	1.63	-15%
99222 – initial inpatient, moderate MDM	2.61	2.60	0%
99223 – initial inpatient, high MDM	3.86	3.50	-9%
99231 – subsequent inpatient, low MDM	0.76	1.00	32%
99232 – subsequent inpatient, moderate MDM	1.39	1.59	14%
99233 – subsequent inpatient, high MDM	2.00	2.40	20%
99234 – inpatient or observation care, same day, low MDM	2.56	2.00	-22%
99235 – inpatient or observation care, same day, moderate MDM	3.24	3.24	0%
99236 – inpatient or observation care, same day, high MDM	4.20	4.30	2%

Prolonged Services - p. 529

CMS finalized changes for the reporting of prolonged services. Specifically, the rule created a prolonged service code which may be used to bill for a prolonged service for only the highest level of initial inpatient visit (99223), subsequent inpatient visit (99233) and hospital inpatient or observation care (admission and discharge) (99236) E/M services when billing by time. The descriptor for G0316 is as follows; “Prolonged hospital inpatient or observation care evaluation and management service(s) beyond the total time for the primary service (when the primary service has been selected using time on the date of the primary service); each additional 15 minutes by the physician or qualified healthcare professional, with or without direct patient contact (list separately in addition to CPT codes 99223, 99233, and 99236 for hospital inpatient or observation care evaluation and management services). (Do not report G0316 on the same date of service as other prolonged services for evaluation and management 99358, 99359, 99415, 99416, 99418). (Do not report G0316 for any time unit less than 15 minutes).

CMS is finalized a work value of 0.61 for this service with a malpractice RVU of 0.04, and a facility practice expense RVU of 0.25.

Providers should use G0316 instead of 99418 when billing Medicare for prolonged services associated with inpatient/observation services. The agency did not support the use of code 99418 as the agency does not agree with the CPT instructions that outline when the prolonged code may be used.

The new G-code may only be used if the practitioner is using time to select the E/M code level, and therefore may only be reported when the service’s upper limit of time has been exceeded for 99223, 99233, and 99236. Below are the coding guidelines that CMS finalized for the use of the prolonged services code:

• The prolonged time can be billed once 15 additional minutes after the total times for 99223, 99233 and 99236 have been met.
• The code is for 15-minute increments, and the entire 15 minutes must be met or exceeded before the G-code may be used.
• Time spent is face-to-face and non-face-to-face on the date of the encounter for initial (99223) and subsequent (99233) services and for three days after for 99236.

Time Thresholds to Report G0316 for Inpatient/Observation Prolonged Services - p. 590

Primary E/M Service	Prolonged Service Code	Time Threshold to Report Prolonged Code	Count Physician Time/NPP time spent within this time period (surveyed time frame)
Initial IP/Obs. Visit (99223)	G0316	105 minutes	Date of visit
Subsequent IP/Obs. Visit (99233)	G0316	80 minutes	Date of visit
IP/Obs. Same-Day Admission/Discharge (99236)	G0316	125 minutes	Date of visit to three days after

CMS also finalized two additional G codes that account for prolonged services for nursing home visits and home/residence visits. See page 590 for additional information.

Proposed Definition of Initial and Subsequent - p. 520

CMS finalized its definition of initial and subsequent and will not use the definition in the CPT code book that notes that a subspeciality within the same practice may be included when determining if a visit is initial or subsequent for the physician providing the service.

• An initial service would be defined as one that occurs when the patient has not received any professional services from the physician or other qualified health care professional or another physician or other qualified health care professional of the same specialty who belongs to the same group practice during the stay.
• A subsequent service would be defined as one that occurs when the patient has received any professional services from the physician or other qualified health care professional or another physician or other qualified health care professional of the same specialty who belongs to the same group practice during the stay.

Note that the only change is the elimination of the word “subspecialty” from each definition. This means that when a patient sees a practitioner with a subspecialty designation within the same group practice, that this does not qualify as a “new patient visit.”

Split/Shared Services - p. 591

CMS decided to delay the much-debated split/shared services policy for another year, until 2024. The agency received many comments on this issue but did not revise its definition of how the agency will determine the provider that bills for a split/shared service. Beginning January 1, 2024, the provider that bills for a split/shared service should be the provider that spent the substantive portion of time (defined as more than half of the total time) with the patient, MDM will NOT be a determining factor. Note that under this policy, if a non-physician practitioner (NPP) performed at least half of the E/M visit (by time), then Medicare would only pay 85% of the MPFS rate.

In 2023, therefore, the billing provider will be determined by who performed the history and physical exam or MDM, or it will be determined by who spent more than half the total time with the patient.

VALUATION OF SPECIFIC CODES FOR CY 2023 – P. 179

Highlight: CMS only proposed to accept 75% of the RUC’s recommendations.

Percutaneous Nephrolithotomy (CPT codes 50080, 50081) – p. 260

The CPT® Editorial Panel revised the descriptors for this code family at the September 2021 meeting: CPT codes 50080 (Percutaneous nephrolithotomy or pyelolithotomy, lithotripsy stone extraction, antegrade ureteroscopy, antegrade stent placement and nephrostomy tube placement, when performed, including imaging guidance; simple (e.g., stone[s] up to 2 cm in a single location of kidney or renal pelvis, nonbranching stones)) and 50081 (Percutaneous nephrolithotomy or pyelolithotomy, lithotripsy stone extraction, antegrade ureteroscopy, antegrade stent placement and nephrostomy tube placement, when performed, including imaging guidance; complex (e.g., stone[s] > 2 cm, branching stones, stones in multiple locations, ureter stones, complicated anatomy). The codes had been identified on the screen for site of service anomalies for services performed in the inpatient setting less than 50% of the time but having 90-day global periods. The revised descriptors added image guidance and nephrostomy tube placement, which had not been included in the previous descriptors, and had been reported separately.

The AUA submitted comments objecting to CMS proposed RVUs, which were lower than the RUC recommended values for these services. CMS rejected commenters’ arguments that the RVUs proposed by RUC were appropriate. The agency noted that in general, when the time for a service or procedure decreases, then the work RVU should have a corresponding decrease. The agency also notes in its comments that “it has been many years since these two CPT codes were last reviewed and percutaneous nephrolithotomy’s technologies and methodologies have changed, which may have added complexities to the service, but at the same time, there have been improvements in methods and efficiencies through research and evaluations of better and best practices.” The agency goes on to say that they see evidence of the efficiencies gained over several years. For example, the intra-service time has dropped 23% from 117 minutes to 90 minutes for code 50080.

Finalized in the rule is an additional 0.30 wRVUs for the performance of a fluoroscopy as they believe this work was not accounted for in the proposed RUC values.

Work RVUs and Time for CPT Codes 50080 and 50081

Code	Current Work RVU/Time	RUC-Recommended Work RVU/Time	CMS Final Work RVU/Time
50080	15.74 wRVUs 117 min intra-service time 359.5 min total time	13.50 wRVUs 90 min intra-service time 244 min total time	12.41 wRVUs 90 min intra-service time 244 min total time
50081	23.0 wRVUs 42 min pre-service evaluation time 0 positioning time 25 min pre-service scrub, dress and wait time 195 min intra-service time 27 min post-service time 507.5 min total time	22.0 work RVUs 40 min pre-service evaluation time 3 min positioning time 10 min scrub, dress and wait time 140 min intra-service time 302 min total time	20.91 wRVUs 40 min pre-service evaluation time 3 min positioning time 10 min scrub, dress and wait time 140 min intra-service time 302 min total time

Laparoscopic Simple Prostatectomy (CPT codes 55821, 55831, 55866, and 55867) – p. 264

This family of codes was RUC reviewed after the CPT® Editorial Panel added code 55867 (Laparoscopy, surgical prostatectomy, simple subtotal (including control of postoperative bleeding, vasectomy, meatotomy, urethral calibration and/or dilation, and internal urethrotomy), includes robotic assistance, when performed). CMS finalized the RUC-recommended work RVUs and PE inputs without change. The agency received two comments on this topic, both in support of the code values.

Work RVUs and Time for CPT Laparoscopic Simple Prostatectomy

Code	Current work RVU/Time	RUC-Recommended wRVU/Time	CMS Final wRVU/Time
55821	15.76 work RVUs 102 min intra-service time 399.5 min total time	15.18 work RVUs 33 min pre-service evaluation time 3 min positioning time 10 min scrub, dress and wait time 120 min intra-service time 25 min post-service time 329 min total time	15.18 work RVUs 315 min total time
55831	17.19 work RVUs 114 min intra-service time 422.5 min total time	15.60 work RVUs 40 min pre-service evaluation time 3 min positioning time 10 min scrub, dress and wait time 120 min intra-service time 25 min post-service time 329 min total time	15.60 work RVUs 322 min total time
55866	26.80 work RVUs 180 min intra-service time 422 min total time	22.46 work RVUs 40 min pre-service evaluation time 15 min positioning time 12 min scrub, dress and wait time 180 min intra-service time 50 min post-service time 362 min total time	22.46 work RVUs 362 min total time
558XX	N/A	19.53 work RVU 40 min pre-service evaluation time 8 min positioning time 11 min scrub, dress and wait time 180 min intra-service time 50 min post-service time 354 min total time	19.53 work RVUs 354 min total time

STRATEGIES FOR IMPROVING GLOBAL SURGICAL PACKAGE VALUATION - P. 76

Highlight: CMS continues to “call into question the accuracy of globals that have been valued through standard valuation processes.”

CMS continues to grapple with the payment for services under the global surgical package construct. In recent years, the agency has studied this issue and solicited public comment as to the best way to pay for services included in a surgical procedure, which includes E/M visits pre- and post-surgery. In the proposed rule, CMS asked for comments on how to address payment for global services and did not propose any policy changes. The agency received comments on nearly every aspect of the “globals”. The comments received indicate that there isn’t any consensus among stakeholders on the strategy to value global services. In the end, the agency agreed that this is a complicated issue and will consider appropriate next steps in future rulemaking.

STRATEGIES FOR UPDATES TO PRACTICE EXPENSE DATA COLLECTION AND METHODOLOGY - P. 64

Highlight: CMS received many comments on updating indirect practice expenses, but no consensus reached among stakeholders.

In the proposed rule, CMS sought comment on the best approach for updating the indirect practice data inputs within the practice expense. Indirect practice expenses are those costs associated with office rent, infrastructure costs such as computers and printers, and other non-clinical expenses associated with operating a medical practice. While no new policies were proposed for 2023, CMS has set a goal of collaborating with stakeholders in developing a methodology that is “consistent, transparent, and predictable.” The indirect practice expense inputs have not been updated since the late 2000’s when the Physician Practice Expenses Survey (PPIS) was last fielded by the AMA.

CMS, as is the theme throughout the rule, would like to update or correct methodology and policies that adversely affect certain MPFS services, which may then lead to access to care issues or disparities in care or outcomes. Many commenters noted that the AMA in the process of conducting a new survey of physician practices expenses, therefore they requested that CMS wait until this survey is complete before proposing new or changing the practice expense data inputs. Of note, the AMA does not expect to have data ready for rulemaking until 2024. CMS commented that if this is the case, then updated data inputs will not be ready for several more years, which will leave the agency with using data that is more than 20 years old for at least the next several rule cycles. Other comments called for the agency to develop an expert panel/advisory group to assist the agency in revising and updating the processes and data used in rate setting under the MPFS.

CMS did not propose alternatives but thanked commenters for the feedback and it will use the comments in developing policy solutions in future years.

REQUEST FOR INFORMATION: MEDICARE POTENTIALLY UNDERUTILIZED SERVICES - P. 458

Highlight: CMS appreciated the comments received and did not address any specific comments.

The proposed rule, and therefore the final rule was policy heavy in that CMS requested information on many topics, without proposing changes. The agency requested comments on the utilization or lack thereof, for high-value services for Medicare beneficiaries. A high-value service is defined as a “service that provide the best possible health outcomes at the lowest possible cost and will improve health, avoid harms, and eliminate wasteful practices.” CMS used the proposed rule as an opportunity to collect information on services that provide high value to the Medicare beneficiary, while simultaneously addressing health disparity issues. CMS “appreciated thoughtful feedback submitted by the public on this important issue and plan to consider these suggestions for possible future rulemaking and program refinement.”

NON-FACE-TO-FACE/REMOTE THERAPEUTIC MONITORING SERVICES – P. 663

Highlight: CMS did not finalize its proposal to create 4 new HCPCS G codes.

Remote Therapeutic Monitoring (RTM) is a family of five codes – three practice expense (PE) only codes and two treatment management codes – finalized for Medicare payment in the CY 2022 MPFS rule. In that rule, CMS permitted therapists (e.g., physical or occupational) and other qualified healthcare practitioners (QHPs), including CSWs, CRNAs, PTs, OTs, and SLPs, to bill the RTM codes.

Regarding the treatment management codes (CPT codes 98980 and 98981), CMS and stakeholders have expressed concern about whether these codes may be billed by qualified NPPs outside of “incident to” billing rules. In response to these concerns, CMS proposed to create four new HCPCS G codes – one pair of codes aimed at reducing physician and non-physician practitioner (NPP) supervisory burden and the second pair aimed at increasing patient access to RTM services. As a result of this proposal, CMS also proposed to change the status of CPT codes 98980 and 98981 to non-payable by Medicare. However, after considering public comments, CMS is not finalizing its proposal to create 4 new HCPCS G codes. Instead, for CY 2023, CMS is maintaining its current policies for the RTM treatment management, CPT codes 98980 and 98981.

In the final rule, CMS issued clarification and finalized new policy regarding the billing requirements for the current RTM codes: CPT codes 98975, 98976, 98977, 98980, and 98981. Beginning January 1, 2023, the below modifications to existing RTM policies will take effect.

• General supervision for all RTM services: Any RTM service may be furnished under CMS’ general supervision requirements.
• Cognitive behavioral therapy monitoring device: CMS finalized its proposal to accept the RUC recommendation to contractor price CPT code 98978 (Remote therapeutic monitoring (eg, therapy adherence, therapy response); device(s) supply with scheduled (eg, daily) recording(s) and/or programmed alert(s) transmission to monitor cognitive behavioral therapy, each 30 days), a PE-only device code. There is no professional work associated with the code.

CMS will continue to gather information and provider experiences with coding and payment policies for RTM services to better understand opportunities and challenges related to policies and claims processing for RTM codes. CMS will consider the need for further guidance or rulemaking regarding these services in the future.

GEOGRAPHIC PRACTICE COST INDICES - P. 597

Highlight: CMS finalizes technical changes to the factors included in calculating the Geographic Practice Cost Indices (GPCIs).

CMS is required to update the GPCI adjustments every three years, and therefore has finalized as proposed, revisions to the 2023 GPCI amounts and changes to the calculations and data inputs. Given that the costs of living are higher in some areas versus others it follows that the cost of providing Medicare services varies by geographic region. Therefore, CMS must adjust payments accordingly. The GPICs are used to calculate and adjust payment for the various geographic regions within the US.

REBASING AND REVISING THE MEDICARE ECONOMIC INDEX - P. 808

Highlight: CMS is seeking comments on revisions to the Medicare Economic Index (MEI), but not proposing any changes for 2023.

CMS finalized policy to rebase (change the base year of data used in the calculation) and revise (change the sample of data used for the calculation) the MEI, which measures input price pressures on providing physician services. The agency will adjust the base year from 2006 to 2017 and will use publicly available data from the U.S. Census Bureau NAICS 6211 Offices of Physicians. The use of the new data will reflect physician ownership of practices, rather than consisting only of data from self-employed physicians. The final MEI update is 3.8 percent based on recent historical data. However, the revised and rebased MEI weights were not used in rate setting for 2023 and were delayed allowing the agency to seek additional comment given the significant impact to physician payments.

PAYMENT FOR MEDICARE TELEHEALTH SERVICES UNDER SECTION 1834(m) OF THE ACT - P. 115

Highlight: CMS finalized changes to Medicare’s telehealth policies, some of which will prepare practitioners for delivering and reporting these services after the end of the public health emergency.

Of note, the agency outlines changes to the telehealth services list; how it plans to implement the 151-day extension of certain telehealth flexibilities authorized by Congress in the Consolidated Appropriations Act, 2022 (P.L. 117-103); what modifier should be appended to telehealth claims after the PHE; the status of virtual direct supervision; and the proposed Medicare telehealth originating site facility fee for CY 2023.

Changes to the Medicare Telehealth Services List

CMS finalized its proposal to add additional services to the Medicare telehealth list with a Category 3 designation, which are services added on a temporary basis through the end of CY 2023 and may be considered for permanent addition when the requirements for Category 1 or Category 2 services can be met. Requests for services to be added to the telehealth list on a permanent basis must be received each year by February 10 for evaluation and potential inclusion in the following calendar year’s list.

CMS has received requests to add telephone E/M visit codes, CPT codes 99441, 99442, and 99443, on a Category 3 basis and reiterated the decision not to add these services to the list on a Category 3 basis. CMS notes that telephone services are not analogous to in-person care or a substitute for a face-to-face encounter outside of the circumstances of the public health emergency, while acknowledging these services can be used to deliver mental health services to patients in their homes under certain circumstances after the PHE based on relevant statutory authority. Therefore, CMS is finalizing its proposal not to add CPT codes 99441-99443 to the Medicare Telehealth Services List on a Category 3 basis. CPT codes 99441-99443 will remain on the Medicare Telehealth Services List through the expiration of the 151-day period following the end of the PHE.

The agency is proposing to add the new HCPCS codes for prolonged services associated with certain types of E/M services—G0316, G0317 and G0318 to the telehealth list on a Category 1 basis since those codes are replacing the existing prolonged service codes, which are currently on the Category 1 list.

CMS is proposing to allow all services that were added to the telehealth list on a temporary basis during the PHE, including those that have not been converted to Category 1, 2 or 3, to remain available through the 151-day period after the end of the PHE authorized by Congress in the Consolidated Appropriations Act, 2022 for certain telehealth flexibilities to remain in place.

Implementation of Provisions Included in the Consolidated Appropriations Act, 2022

The Consolidated Appropriations Act, 2022 (P.L. 117-103) requires the continued waiver of the originating site and geographic restrictions, and coverage of services designated for delivery via audio-only on the date of enactment on March 15, 2022. In the final rule, CMS reiterates its intention to issue program instructions or other sub-regulatory guidance to effectuate the changes required by statute when appropriate.

Telehealth Service Modifiers

At the start of the public health emergency, CMS directed physicians to report the place of service (POS) code that would have been reported if that telehealth visit had occurred in-person. To facilitate this, physicians were instructed to add modifier “95” to claims to indicate a telehealth service along with the appropriate POS code. During the 151-day extension of certain telehealth flexibilities after the public health emergency concludes, CMS will continue to process Medicare telehealth claims that include modifier “95” as well as the appropriate POS code as had been the practice during the public health emergency. After the telehealth extension period concludes, modifier “95” will no longer be required, and the POS indicators for telehealth services include:

• POS 02 – Telehealth Provided Other than in Patient’s Home (Descriptor: The location where health services and health related services are provided or received, through telecommunication technology. Patient is not located in their home when receiving health services or health related services through telecommunication technology.) CMS clarifies that for services furnished in a facility as an originating site, POS 02 may be used, and the corresponding facility fee can be billed, per pre-PHE policy, beginning the 152nd day after the end of the PHE.
• POS 10 – Telehealth Provided in Patient’s Home (Descriptor: The location where health services and health related services are provided or received through telecommunication technology. Patient is in their home (which is a location other than a hospital or other facility where the patient receives care in a private residence) when receiving health services or health related services through telecommunication technology.).

Payment for these services will be made at the facility payment rate in accordance with established CMS policy. The agency continues to believe the facility payment amount best reflects the direct and indirect practices expenses of telehealth services.

Further, effective January 1, 2023, a physician billing for telehealth services using audio-only communication technology may append CPT modifier “93” (Synchronous Telemedicine Service Rendered Via Telephone of Other Real-Time Interactive Audio-Only Telecommunications System: Synchronous telehealth medicine service is defined as a real-time interaction between a physician or other qualified health care professional and a patient who is located away at a distant site from the physician or other qualified health care professional. The totality of the communication of information exchanged between the physician or other qualified health care professional and the patient during the synchronous telemedicine service must be of an amount and nature that is sufficient to meet the key components and/or requirements of the same service when rendered via a face-to-face interaction) to claims for which audio-only technology is permitted.

Additionally, all providers, including Rural Health Clinics (RHCs), Federally Qualified Health Centers (FQHCs), and Opioid Treatment Programs (OTPs) must append Medicare modifier “FQ” (Medicare telehealth service was furnished using audio-only communication technology) for allowable audio-only services furnished in those settings. However, CMS will require all providers including RHCs, FQHCs, and OTPs to use modifier “93” when billing for eligible mental health services furnished via audio-only telecommunications technology. Therefore, providers will have the option to use the “FQ” or the “93” modifiers or both. Supervising practitioners should continue to append the “FR” modifier on any telehealth claims for when required to be present through an interactive real-time, audio and video telecommunications link, as the service may require.

Comment Solicitation on Virtual Direct Supervision

CMS has finalized policy that on December 31 in the year in which the public health emergency ends the pre-public health emergency rules for direct supervision would again apply, meaning the temporary exception to allow immediate availability for direct supervision through a virtual presence will no longer apply. In the proposed rule, CMS requested additional information on whether the flexibility to meet the availability requirement for direct supervision through virtual presence should be made permanent and whether this should only be applied to a subset of services should it be made permanent. CMS received comments from many stakeholders recommending a permanent change to direct supervision rules citing concerns such as workforce shortages and clinician burnout. Additionally, commenters recommended permanent virtual direct supervision on a specialty-level or service-level analysis. For example, commenters identified a certain specialty or family of codes that would be typically low-risk for patient safety issues, and indicated that those specialties or services would be appropriate for permanent virtual direct supervision policy. In the final rule, CMS states that they are continuing to gather information and evidence for direct supervision through virtual presence to better understand the appropriateness of this flexibility outside of the COVID-19 PHE.

Telehealth Originating Site Facility Fee

The telehealth statute established a Medicare telehealth originating site facility fee that is updated based on the Medicare Economic Index (MEI). For CY 2023, the final payment amount for HCPCS code Q3014 (Telehealth originating site facility fee) is $28.64.

REQUIRING MANUFACTURERS OF CERTAIN SINGLE-DOSE CONTAINER OR SINGLE-USE PACKAGE DRUGS TO PROVIDE REFUNDS WITH RESPECT TO DISCARDED AMOUNTS (§§ 414.902 AND 414.940) – P. 862

Highlight: CMS has finalized implementation of this provision without any major deviations from the statutory language; makes final hydrogel exceptions

CMS data show that Medicare Part B paid nearly $720 million for discarded amounts of drugs from a single-dose container or single-use package based on claims billed with the JW modifier (Drug amount discarded/not administered to any patient), which is comparable to the other recent years for which data is available. Section 90004 of the Infrastructure Investment and Jobs Act (Pub. L. 117-58) included a provision to require manufacturers to provide a refund to CMS for certain discarded drug amounts from a refundable single-dose container or single-use package drug with certain exclusions. This new requirement will apply to drugs paid under all Medicare Part B methodologies.

The agency has finalized the policy to use the JW modifier to determine the total number of discarded billing units for a single-dose container or single-use package drug as identified by its billing and payment code during each quarter. Hospital outpatient departments will also be required to report the JW modifier for single-dose containers or single-use package drugs; however, units of these drugs packaged into APCs will be excluded from the refund amount.

While the JW modifier is currently reported, CMS recognizes the data is incomplete; therefore, beginning January 1, 2023, the JW modifier will be required on all claims for all drugs for which any amount is discarded and a separate modifier, the JZ modifier, will be required on claims for these drugs when no amount is discarded if as finalized in the rule. The agency does not believe this policy will increase provider burden since providers already determine whether any units of these drugs have been discarded.

CMS finalized its definition of “refundable single-dose container or single-use package drug” to include those FDA-approved drugs whose label or product information describes them as being supplied in a “single-dose” container or “single-use” package. This would be inclusive of those drugs described as a “kit” intended for a single dose or single use. To meet this definition, all national drug codes (NDCs) assigned to the drug’s billing and payment code must meet these labeling requirements.

The statute includes certain drug exclusions, which CMS will implement as follows:

• Radiopharmaceuticals and imaging agents described as such in FDA-approved labeling.
• Drugs with a filtration requirement stated on the FDA label; and
• Single-dose container or single-use package drugs approved by FDA on or after November 15, 2021, for which Part B payment has been made for fewer than 18 months with the 18-month period or six calendar quarters beginning on the first day of the calendar quarter following the date of the first sale as reported to CMS for the drug. This exclusion applies only once per drug. Should additional NDCs in the same billing and payment code be FDA approved, marketed, and paid under Part B, this exclusion would not apply.

To operationalize this provision, CMS will provide an annual report to manufacturers for each calendar quarter, however CMS did not finalize the timing of the initial reports to manufacturers, nor did the agency finalize a date by for when the first refunds will be due. The agency did finalize that a preliminary report on estimated discarded drug amounts based on claims from the first two calendar quarters of 2023 will be issued no later than December 31, 2023 and the agency will revisit the timing of the first report in future rulemaking.

CMS considered whether to use the authority granted by Congress to raise the applicable percentage of waste that triggers a refund for drugs with unique circumstances. Specifically, the agency considered drugs that must be reconstituted with hydrogel noting that a substantial amount adheres to the vial wall during preparation. The agency speculated 35 percent may be appropriate to account for the portion of the drug that adheres to the vial. The AUA commented that CMS should use its authority and finalize policy that raises the applicable percentage to 35 percent for wastage associated with drugs reconstituted with hydrogel. With this rule, CMS adopted this policy to allow for 35% wastage, and in this case, the only drug to which it would apply is Jelmyto® (mitomycin for pyelocalyceal solution) would.

CHANGES TO THE QUALITY PAYMENT PROGRAM – P. 1859

TRANSFORMING THE MERIT-BASED INCENTIVE PAYMENT SYSTEM (MIPS): MIPS VALUE PATHWAY STRATEGY – P. 1870

Highlight: CMS notes that MIPS will be phased out, and replaced entirely by MVPs, but a timeline has not been set.

CMS is proceeding with the transition to the MIPS Value Pathways (MVPs) to improve value, reduce burden, inform patient choice in selecting clinicians, and reduce barriers to participation in Alternative Payment Models (APMs). MVPs will be available for voluntary reporting beginning with the CY 2023 MIPS performance period, and the agency intends for MVPs to be the only method to participate in MIPS in future years, although they have not yet finalized timing to sunset traditional MIPS.

MVP DEVELOPMENT AND REPORTING REQUIREMENTS - P. 1874

Highlight: CMS will have twelve new MVPs available for reporting in 2023.

CMS finalized the proposal to modify the MVP development process to allow the agency to evaluate a submitted candidate MVP on an ongoing basis through the MVP development process and then post a draft version of the submitted candidate MVP on the QPP website to solicit feedback for a 30-day period. CMS will then review the feedback submitted and determine if any changes should be made to the MVP before including it in proposed rulemaking.

CMS finalized the proposal to modify the MVP maintenance process so that stakeholders can submit their recommendations for potential revisions to established MVPs on a yearly rolling basis. If any submitted recommendations are considered feasible and appropriate, the agency will host a webinar where stakeholders may offer feedback on any potential revisions. Any revisions are then made through notice and comment rulemaking.

CMS finalized the inclusion of 12 MVPs for CY 2023 performance period. The following seven MVPs were finalized in the CY 2022 rulemaking cycle and were revised this year to reflect the removal of certain activities and the addition of other relevant quality measures:

• Advancing Rheumatology Patient Care
• Coordinating Stroke Care to Promote Prevention and Cultivate Positive Outcomes
• Advancing Care for Heart Disease
• Optimizing Chronic Disease Management
• Adopting Best Practices and Promoting Patient Safety within Emergency Medicine
• Improving Care for Lower Extremity Joint Repair
• Patient Safety and Support of Positive Experiences with Anesthesia

See Appendix 3: MVP Inventory (p. 2902) for the final versions of these seven MVPs. CMS finalized five new MVPs:

• Advancing Cancer Care: most applicable to clinicians who treat patients within the practice of oncology and hematology
• Optimal Care for Kidney Health: most applicable to clinicians who treat patients within the practice of nephrology
• Optimal Care for Patients with Episodic Neurological Conditions: most applicable to clinicians who treat patients within the practice of neurology
• Supportive Care for Cognitive-based Neurological Conditions: most applicable to clinicians who treat patients within the practice of neurology
• Promoting Wellness: most applicable to clinicians who treat patients within the practice of preventive medicine, internal medicine, family medicine, and geriatrics

See Appendix 3: MVP Inventory (p. 2902) for details on the new MVPs.

CMS provided clarification on options for how multispecialty groups who practice in team-based care can report MVPs. The agency encouraged multispecialty groups to consider adopting subgroup reporting before it becomes mandatory in the CY 2026 performance period.

For subgroup reporting, CMS finalized the following changes: 1) to modify the definition of single specialty group and multispecialty group; 2) to add subgroup description requirements to the registration process; 3) to limit the number of subgroups a clinician may participate in to one subgroup per TIN; 4) establish the subgroup determination period; 5) apply new policies for scoring administrative claims measures and cost measures for subgroups; and 6) not assign a subgroup final score to registered subgroups that do not submit data.

APM PERFORMANCE PATHWAY – P. 1907

CMS finalized the APM Performance Pathway (APP), which was designed to provide predictable and consistent MIPS reporting options to reduce reporting burden and encourage continued APM participation, for performance year 2021. CMS finalized the proposal to modify the language and remove the reference to subgroup scoring of the APP, which would clarify that reporting of the APP by a subset of a group is not allowed. In the future, CMS could propose changes to allow subgroup reporting if this is of interest to MIPS eligible clinicians.

MIPS PERFORMANCE CATEGORY SCORING - P. 1910

Highlight: Addressing health equity is a priority for CMS. New measures created to better understand the issues.

MIPS is one of two tracks under the Quality Payment Program, which allows for Medicare Part B providers to participate in a performance-based payment system.

CMS did not receive any feedback on the potential INCLUSION of two new measures in the APP measure set in future rulemaking:

• MUC21-136: Screening for Social Drivers of Health
• MUC21-134: Screen Positive Rate for Social Drivers of Health

CMS appreciated the feedback on the health equity requests for information and will consider the responses to inform future rulemaking.

Quality Performance Category – p. 1912

CMS finalized several changes to the quality performance category:

• Revised the definition of the term “high priority measure” to include quality measurement pertaining to health equity.
• Replaced the “Asian language survey completion” variable with “language other than English spoken at home” variable in the case-mix adjustment model for the Consumer Assessment of Healthcare Providers and Systems (CAPHS) for MIPS Survey.
• Increased the data completeness criteria threshold to at least 75 percent for CY 2024 and CY 2025 performance periods/2026 and 2027 MIPS payment years.
• Modified the MIPS quality measure set to include the addition of nine new measures, updates to several specialty sets, removal of ELEVEN existing measures; partial removal of TWO existing measures (removed from traditional MIPS but retained for MVPs), and substantive changes to seventy-six existing measures.

CMS is considering developing quality measure to address amputation avoidance in patients with diabetes, which would assess the percent of patients with diabetes who receive neurologic and vascular assessments of their lower extremities to determine ulcer risk, have a documented ulcer risk level, and who receive a follow-up plan of care if identified as high risk for ulcer. CMS appreciated the feedback received and will consider the information received to inform future rulemaking.

Cost Performance Category – p. 1941

CMS finalized the proposal to update the operational list of care episode and patient condition groups and codes by adding the Medicare Spending per Beneficiary (MSPB) Clinician cost measure as a care episode group.

Improvement Activities Performance Category – p. 1947

CMS finalized changes to the improvement activities inventory for the CY 2023 performance period/2025 MIPS payment year and future years, including adding four new improvement activities, modifying five existing improvement activities, and removing six previously adopted improvement activities. For one new activity, COVID-19 Vaccine Achievement for Practice Staff, CMS revised the activity description based on feedback from public comments.

Promoting Interoperability Performance Category – p. 1956

For the 2024 MIPS payment year and each subsequent payment year, the performance period for the Promoting Interoperability performance category is a minimum of any continuous 90-day period within the calendar year that occurs two years prior to the applicable MIPS payment year, up to and including the full calendar year.

Beginning with the performance period in CY 2023, CMS will require the Query of PDMP measure for MIPS eligible clinicians participating in the Promoting Interoperability performance category. The measure will be worth 10 points, but they will no longer be bonus points because the measure will be required. Two exclusions apply: 1) any MIPS eligible clinician who is unable to electronically prescribe Schedule II opioids and Schedule III and IV drugs in accordance with applicable law during the performance period, and 2) any MIPS eligible clinician who writes fewer than 100 permissible prescriptions during the performance period.

CMS also expanded the Query of PDMP measure to include Schedule III and IV drugs, in addition to Schedule II opioids.

CMS finalized the proposal to add a new measure to the Health Information Exchange Objective beginning with the CY 2023 performance period: Enabling Exchange under the Trusted Exchange Framework and Common Agreement (TEFCA) measure. This will offer health care providers more opportunities to earn credit for the Health Information Exchange Objective and would incentivize health care providers to enable exchange under TEFCA, which is critical to advancing health care data exchange nationwide.

Under the Public Health and Clinical Data Exchange Objective, CMS revised the options under Active Engagement to consolidate the existing first two options (initial registration and the testing and validation process). The proposed option two would be the existing option three, validated data production.

Furthermore, beginning with CY 2024 performance period, MIPS eligible clinicians would only be able to spend one performance period at the pre-production and validation level of active engagement per measure; they must progress to the validated data production level in the next performance period for which they report a particular measure.

MIPS FINAL SCORE METHODOLOGY – P. 1999

Highlight: The agency made technical changes to calculating the final MIPS score.

CMS continues to build on the scoring methodology finalized in prior years, which allows for accountability and alignment across the performance categories and minimizes burden on MIPS eligible clinicians. For the CY 2023 performance period/2025 MIPS payment year, CMS finalized the following:

• Revise the benchmarking policy to score administrative claims measures in the quality performance category using a benchmark calculated from performance period data.
• Clarify the topped-out measure policy and update the topped-out measure life cycle for scoring topped-out measures in the quality performance category.
• Establish a maximum cost improvement score of 1 percentage point out of 100 for the cost performance category beginning with the CY 2022 performance period/2024 MIPS payment year.

CMS finalized the following changes for calculating the final score:

• A facility-based MIPS eligible clinician will be eligible to receive the complex patient bonus beginning with the CY 2023 performance period/2025 MIPS payment year.
• Virtual groups will be eligible for facility-based measurement.
• Finalized conforming changes to the definition of a facility-based MIPS eligible clinician to align with the previously revisions to the definition made in the 2018 Quality Payment Program final rule.

CMS finalized the proposal to establish the performance threshold for the CY 2025 MIPS payment year using 2019 MIPS payment year data. The performance threshold would be the mean of the final scores for all MIPS eligible clinicians, which is 75 points (rounded up from 74.56). CMS aims to provide performance feedback to MIPS eligible clinicians and groups on or around July 1 of each year, but due to the PHE and COVID-19, feedback may be received later.

THIRD PARTY INTERMEDIARIES GENERAL REQUIREMENTS – P. 2066

Highlight: The agency signals that telehealth is a valuable tool by adding an indicator to clinician and group profile pages on HHS’ Care Compare website that would clarify the clinicians offering telehealth services.

CMS allows eligible clinicians to participate in MIPS using third party intermediaries that collect or submit data on their behalf, which improves flexible reporting options. CMS updated the definition of a third- party intermediary to include subgroups and AMP Entities. CMS revised the Qualified Clinical Data Registry (QCDR) measure self-nomination and measure approval requirements, including to delay the QCDR measure testing requirement for traditional MIPS by an additional year (until the CY 2024 performance period/2026 MIPS payment year). CMS finalized the proposal to revise the remedial action and termination of third-party intermediaries' policies. CMS appreciated the feedback on the two RFIs on third party intermediary support of MVPS and will use this feedback for future rulemaking.

Public Reporting on the Compare Tools hosted by HHS – p. 2088

CMS is adding an indicator to clinician profile pages on HHS’ Care Compare website that would clarify the clinicians that offer telehealth services. CMS would identify clinicians who perform telehealth services using Place of Service Code 02 (Telehealth Provided Other than in Patient’s Home) or 10 (Telehealth Provided in Patient’s Home) on carrier claims, or modifier 95 appended on paid claims. CMS will then use a 6-month lookback period and refresh the telehealth indicator bi-monthly, to ensure that when a time- limited Category 3 telehealth code expires, a clinician who only bills telehealth services under the expired code would no longer have a telehealth indicator on their profile page.

CMS will publicly report Medicare procedural utilization on the Compare tool clinician profile pages. This may allow patients and caregivers to make more informed healthcare decisions. CMS will begin publicly reporting this data no earlier than CY 2023.

OVERVIEW OF THE APM INCENTIVE – P. 2103

Highlight: CMS updated the annual notice cut-off date for Qualifying APM Participants

Under the QPP, an eligible clinician who is a Qualifying APM Participant (QP) for a performance year earns an APM Incentive Payment, which is made in the corresponding payment year for payment years 2019 through 2024. This payment is made based on the clinician’s QP status in the QP Performance Period that is two years prior, and the APM Incentive Payment is equal to five percent of the eligible clinician’s estimated aggregate payments for covered professional services in the base period.

CMS notifies QPs for whom they are unable to identify an appropriate TIN to make the APM Incentive Payment through an annual notice in the Federal Register. CMS is updating the specified cutoff date from November 1 to September 1 of the payment year, or 60 days from the date on which the agency makes the initial round of payments, whichever is later.

Payment Year 2024 is the final year for which the statute authorizes an APM Incentive Payment. After performance year 2022/payment year 2024, there is no further statutory authority for a 5 percent APM Incentive Payment for eligible clinicians who become QPs for a year. In performance year 2023/payment year 2025, the statute does not provide for any type of incentive for eligible clinicians who become QPs. CMS is concerned that the statutory incentive structure beginning in the 2023 performance year/2025 payment year could lead to a drop in Advanced APM participation.

To address this in future rulemaking, CMS sought public comment that they could use to identify potential options for the 2024 performance period/2026 payment year, and beyond. CMS appreciated the feedback received through public comment and a public listening session and will continue to engage the public moving forward.

Advanced APMs

CMS finalized several changes to policies on Advanced APM criteria, provided clarification around payment based on quality measures, and modified the period of applicability for the generally applicable nominal amount standard.

CMS is considering discontinuing the policy to calculate Threshold Scores and make most QP determinations at the APM Entity level, to instead make all QP determinations at the individual eligible clinician level. CMS appreciated the feedback on this approach and will consider it for future rulemaking on changes to the QPP.

Appendix A

New Quality Measures Finalized for the 2023 Performance Period/2025 MIPS Payment Year and Future Payment Years

• Psoriasis – Improvement in Patient-Reported Itch Severity
• Dermatitis – Improvement in Patient-Reported Itch Severity
• Screening for Social Drivers of Health
• Kidney Health Evaluation
• Adult Kidney Disease: Angiotensin Converting Enzyme (ACE) Inhibitor or Angiotensin Receptor Blocker (ARB) Therapy
• Appropriate Intervention of Immune-Related Diarrhea and/or Colitis in Patients Treated with Immune Checkpoint Inhibitors
• Mismatch Repair (MMR) or Microsatellite Instability (MSI) Biomarker Testing Status in Colorectal Carcinoma, Endometrial, Gastroesophageal, or Small Bowel Carcinoma
• Risk-Standardized Acute Cardiovascular-Related Hospital Admission Rates for Patients with Heart Failure under the Merit-based Incentive Payment System
• Adult Immunization Status

Appendix B

Final Changes to Specialty Measure Sets for 203 Performance Period/2025 MIPS Payment Year and Future Payment Years

Urology—Finalized for Addition
Measure Title and Description	Measure Type/Domain	Measure Steward
Preventive Care and Screening: Screening for Depression and Follow-Up Plan: Percentage of patients aged 12 years and older screened for depression on the date of the encounter or up to 14 days prior to the date of the encounter using an age- appropriate standardized depression screening tool AND if positive, a follow-up plan is documented on the date of the eligible encounter.	Process/Community/Population Health	Centers for Medicare & Medicaid Services
Use of High-Risk Medications in Older Adults: Percentage of patients 65 years of age and older who were ordered at least two high-risk medications from the same drug class.	Process/Patient Safety	National Committee for Quality Assurance
CAHPS for MIPS Clinician/Group Survey: The Consumer Assessment of Healthcare Providers and Systems (CAHPS) for MIPS Clinician/Group Survey is comprised of 10 Summary Survey Measures (SSMs) and measures patient experience of care within a group practice. The NQF endorsement status and endorsement id (if applicable) for each SSM utilized in this measure are as follows: • Getting Timely Care, Appointments, and Information; (Not endorsed by NQF) • How well Providers Communicate; (Not endorsed by NQF) • Patient’s Rating of Provider; (NQF endorsed # 0005) • Access to Specialists; (Not endorsed by NQF) • Health Promotion and Education; (Not endorsed by NQF) • Shared Decision-Making; (Not endorsed by NQF) • Health Status and Functional Status; (Not endorsed by NQF) • Courteous and Helpful Office Staff; (NQF endorsed # 0005) • Care Coordination; (Not endorsed by NQF) • Stewardship of Patient Resources. (Not endorsed by NQF)	Patient Engagement & Experience/Person and Caregiver Centered Experience and Outcomes	Agency for Healthcare Research and Quality
Percentage of Patients Who Died from Cancer Receiving Chemotherapy in the Last 14 Days of Life (lower score – better): Percentage of patients who died from cancer receiving chemotherapy in the last 14 days of life.	Process/Effective Clinical Care	American Society of Clinical Oncology
Percentage of Patients Who Died from Cancer Admitted to Hospice for Less than 3 days (lower score – better): Percentage of patients who died from cancer and admitted to hospice and spent less than 3 days there.	Outcome/Effective Clinical Care	American Society of Clinical Oncology
Screening for Social Drivers of Health: Percent of beneficiaries 18 years and older screened for food insecurity, housing instability, transportation needs, utility difficulties, and interpersonal safety.	Process/Patient Safety	Physicians Foundation
Kidney Health Evaluation: Percentage of patients aged 18- 75 years with a diagnosis of diabetes who received a kidney health evaluation defined by an Estimated Glomerular Filtration Rate (eGFR) AND Urine Albumin-Creatinine Ratio (uACR) within the 12-month measurement period.	Process/Effective Clinical Care	National Kidney Foundation

Urology—Finalized for Removal
Measure Title and Description	Measure Type/Domain	Measure Steward
Diabetes: Medical Attention for Nephropathy: The percentage of patients 18- 75 years of age with diabetes who had a nephropathy screening test or evidence of nephropathy during the measurement period.	Process/Effective Clinical Care	National Committee of Quality Assurance
Biopsy Follow-Up: Percentage of new patients whose biopsy results have been reviewed and communicated to the primary care/referring physician and patient.	Process/Communication and Care Coordination	American Academy of Dermatology