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Rule

Medicare Program; Revisions to Payment Policies Under the Physician Fee Schedule, Clinical Laboratory Fee Schedule & Other Revisions to Part B for CY 2014

Action

Final Rule With Comment Period.

Summary

This major final rule with comment period addresses changes to the physician fee schedule, clinical laboratory fee schedule, and other Medicare Part B payment policies to ensure that our payment systems are updated to reflect changes in medical practice and the relative value of services. This final rule with comment period also includes a discussion in the Supplementary Information regarding various programs. (See the Table of Contents for a listing of the specific issues addressed in the final rule with comment period.)

Unified Agenda

 

Table of Contents Back to Top

Tables Back to Top

DATES: Back to Top

Effective date: The provisions of this final rule with comment period are effective on January 1, 2014, except for the amendments to §§ 405.350, 405.355, 405.405.2413, 405.2415, 405.2452, 410.19, 410.26, 410.37, 410.71, 410.74, 410.75, 410.76, 410.77, and 414.511, which are effective January 27, 2014, and the amendments to §§ 405.201, § 405.203, § 405.205, § 405.207, § 405.209, § 405.211, § 405.212, § 405.213, § 411.15, and 423.160, which are effective on January 1, 2015.

The incorporation by reference of certain publications listed in the rule is approved by the Director of the Federal Register as of January 1, 2014.

Applicability dates: Additionally, the policies specified in under the following preamble sections are applicable January 27, 2014:

  • Physician Compare Web site (section III.G.);
  • Physician Self-Referral Prohibition: Annual Update to the List of CPT/HCPCS Codes. (section III.N.)

Comment date: To be assured consideration, comments must be received at one of the addresses provided below, no later than 5 p.m. on January 27, 2014. (See the SUPLEMENTARY INFORMATION section of this final rule with comment period for a list of the provisions open for comment.)

ADDRESSES: Back to Top

In commenting, please refer to file code CMS-1600-FC. Because of staff and resource limitations, we cannot accept comments by facsimile (FAX) transmission.

You may submit comments in one of four ways (please choose only one of the ways listed):

1. Electronically. You may submit electronic comments on this regulation to www.regulations.gov. Follow the instructions for “submitting a comment.”

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-1600-FC, P.O. Box 8013, Baltimore, MD 21244-8013.

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-1600-FC, Mail Stop C4-26-05, 7500 Security Boulevard, Baltimore, MD 21244-1850.

4. By hand or courier. If you prefer, you may deliver (by hand or courier) your written comments before the close of the comment period to either of the following addresses:

a. For delivery in Washington, DC—Centers for Medicare & Medicaid Services, Department of Health and Human Services, Room 445-G, Hubert H. Humphrey Building, 200 Independence Avenue SW., Washington, DC 20201.

(Because access to the interior of the Hubert H. Humphrey Building is not readily available to persons without federal government identification, commenters are encouraged to leave their comments in the CMS drop slots located in the main lobby of the building. A stamp-in clock is available for persons wishing to retain a proof of filing by stamping in and retaining an extra copy of the comments being filed.)

b. For delivery in Baltimore, MD—Centers for Medicare & Medicaid Services, Department of Health and Human Services, 7500 Security Boulevard, Baltimore, MD 21244-1850.

If you intend to deliver your comments to the Baltimore address, please call telephone number (410) 786-7195 in advance to schedule your arrival with one of our staff members.

Comments mailed to the addresses indicated as appropriate for hand or courier delivery may be delayed and received after the comment period.

FOR FURTHER INFORMATION CONTACT: Back to Top

Elliott Isaac, (410) 786-4735 or Elliott.Isaac@cms.hhs.gov, for any physician payment issues not identified below.

Chava Sheffield, (410) 786-2298 or Chava.Sheffield@cms.hhs.gov, for issues related to practice expense methodology, impacts, the sustainable growth rate, or conversion factors.

Ryan Howe, (410) 786-3355 or Ryan.Howe@cms.hhs.gov, for issues related to direct practice expense inputs or interim final direct PE inputs.

Kathy Kersell, (410) 786-2033 or Kathleen.Kersell@cms.hhs.gov, for issues related to misvalued services.

Jessica Bruton, (410) 786-5991 or Jessica.Bruton@cms.hhs.gov, for issues related to work or malpractice RVUs.

Heidi Oumarou, (410) 786-7942 or Heidi.Oumarou@cms.hhs.gov, for issues related to the revision of Medicare Economic Index (MEI).

Gail Addis, (410) 786-4552 or Gail.Addis@cms.hhs.gov, for issues related to the refinement panel.

Craig Dobyski, (410) 786-4584 or Craig.Dobyski@cms.hhs.gov, for issues related to geographic practice cost indices.

Ken Marsalek, (410) 786-4502 or Kenneth.Marsalek@cms.hhs.gov, for issues related to telehealth services.

Simone Dennis, (410) 786-8409 or Simone.Dennis@cms.hhs.gov, for issues related to therapy caps.

Darlene Fleischmann, (410) 786-2357 or Darlene.Fleischmann@cms.hhs.gov, for issues related to “incident to” services or complex chronic care management services.

Corinne Axelrod, (410) 786-5620 or Corrine.Axelrod@cms.hhs.gov, for issues related to “incident to” services in Rural Health Clinics or Federally Qualified Health Centers.

Roberta Epps, (410) 786-4503 or Roberta.Epps@cms.hhs.gov, for issues related to chiropractors billing for evaluation and management services.

Rosemarie Hakim, (410) 786-3934 or Rosemarie.Hakim@cms.hhs.gov, for issues related to coverage of items and services furnished in FDA-approved investigational device exemption clinical trials.

Jamie Hermansen, (410) 786-2064 or Jamie.Hermansen@cms.hhs.gov or Jyme Schafer, (410) 786-4643 or Jyme.Schafer@cms.hhs.gov, for issues related to ultrasound screening for abdominal aortic aneurysms or colorectal cancer screening.

Anne Tayloe-Hauswald, (410) 786-4546 or Anne-E-Tayloe.Hauswald@ cms.hhs.gov, for issues related to ambulance fee schedule and clinical lab fee schedule.

Ronke Fabayo, (410) 786-4460 or Ronke.Fabayo@cms.hhs.gov or Jay Blake, (410) 786-9371 or Jay.Blake@cms.hhs.gov, for issues related to individual liability for payments made to providers and suppliers and handling of incorrect payments.

Rashaan Byers, (410) 786-2305 or Rashaan.Byers@cms.hhs.gov, for issues related to physician compare.

Christine Estella, (410) 786-0485 or Christine.Estella@cms.hhs.gov, for issues related to the physician quality reporting system and EHR incentive program.

Sandra Adams, (410) 786-8084 or Sandra.Adams@cms.hhs.gov, for issues related to Medicare Shared Savings Program.

Michael Wrobleswki, (410) 786-4465 or Michael.Wrobleswki@cms.hhs.gov, for issues related to value-based modifier and improvements to physician feedback.

Andrew Morgan, (410) 786-2543 or Andrew.Morgan@cms.hhs.gov, for issues related to e-prescribing under Medicare Part D.

Pauline Lapin, (410)786-6883 or Pauline.Lapin@cms.hhs.gov, for issues related to the chiropractic services demonstration budget neutrality issue.

SUPPLEMENTARY INFORMATION: Back to Top

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 Web site as soon as possible after they have been received: http://www.regulations.gov. Follow the search instructions on that Web site to view public comments.

Comments received timely will also be available for public inspection as they are received, generally beginning approximately 3 weeks after publication of a document, at the headquarters of the Centers for Medicare & Medicaid Services, 7500 Security Boulevard, Baltimore, Maryland 21244, Monday through Friday of each week from 8:30 a.m. to 4 p.m. To schedule an appointment to view public comments, phone 1-800-743-3951.

Table of Contents Back to Top

I. Executive Summary and Background

A. Executive Summary

B. Background

II. Provisions of the Final Rule With Comment Period for PFS

A. Resource-Based Practice Expense (PE) Relative Value Units (RVUs)

B. Misvalued Services

C. Malpractice RVUs

D. Medicare Economic Index (MEI)

E. Establishing RVUs for CY 2014

F. Geographic Practice Cost Indices (GPCIs)

G. Allowed Expenditures for Physicians' Services and the Sustainable Growth Rate

H. Medicare Telehealth Services for the Physician Fee Schedule

I. Therapy Caps

J. Requirements for Billing “Incident to” Services

K. Chronic Care Management (CCM) Services

L. Collecting Data on Services Furnished in Off-Campus Provider-Based Departments

M. Chiropractors Billing for Evaluation & Management Services

III. Other Provisions of the Proposed Regulations

A. Medicare Coverage of Items and Services in FDA-Approved Investigational Device Exemption Clinical Studies—Revisions of Medicare Coverage Requirements

B. Ultrasound Screening for Abdominal Aortic Aneurysms

C. Colorectal Cancer Screening: Modification to Coverage of Screening Fecal Occult Blood Tests

D. Ambulance Fee Schedule

E. Policies Regarding the Clinical Laboratory Fee Schedule

F. Liability for Overpayments to or on Behalf of Individuals Including Payments to Providers or Other Persons

G. Physician Compare Web site

H. Physician Payment, Efficiency, and Quality Improvements—Physician Quality Reporting System

I. Electronic Health Record (EHR) Incentive Program

J. Medicare Shared Savings Program

K. Value-Based Payment Modifier and Physician Feedback Program

L. Updating Existing Standards for E-Prescribing Under Medicare Part D

M. Discussion of Budget Neutrality for the Chiropractic Services Demonstration

N. Physician Self-Referral Prohibition: Annual Update to the List of CPT/HCPCS Codes

IV. Collection of Information Requirements

V. Response to Comments

VI. Waiver of Proposed Rulemaking and Waiver of Delay of Effective Date

VII. Regulatory Impact Analysis

Regulations Text

Acronyms Back to Top

In addition, because of the many organizations and terms to which we refer by acronym in this final rule with comment period, we are listing these acronyms and their corresponding terms in alphabetical order below:

AAAAbdominal aortic aneurysms

ACAAffordable Care Act (Pub. L. 111-148)

ACOAccountable care organization

AHEAverage hourly earnings

AMAAmerican Medical Association

AMA RUCAMA [Specialty Society] Relative (Value) Update Committee

ASCAmbulatory surgical center

ATRAAmerican Taxpayer Relief Act (Pub. L. 112-240)

AWVAnnual wellness visit

BBABalanced Budget Act of 1997 (Pub. L. 105-33)

BBRA[Medicare, Medicaid and State Child Health Insurance Program] Balanced Budget Refinement Act of 1999 (Pub. L. 106-113)

BEABureau of Economic Analysis

CAHCritical access hospital

CBSACore-Based Statistical Area

CCMChronic Care Management

CEDCoverage with evidence development

CEHRTCertified EHR technology

CFConversion factor

CLFSClinical Laboratory Fee Schedule

CMDContractor medical director

CMHCCommunity mental health center

CMTChiropractic manipulative treatment

CORFComprehensive outpatient rehabilitation facility

CPCComprehensive Primary Care

CPEPClinical Practice Expert Panel

CPI-UConsumer Price Index for Urban Areas

CPSCurrent Population Survey

CPT[Physicians] Current Procedural Terminology (CPT codes, descriptions and other data only are copyright 2013 American Medical Association. All rights reserved.)

CQMClinical quality measure

CTComputed tomography

CTAComputed tomographic angiography

CYCalendar year

DFARDefense Federal Acquisition Regulations

DHSDesignated health services

DRADeficit Reduction Act of 2005 (Pub. L. 109-171)

DSMTDiabetes self-management training

ECECEmployer Costs for Employee Compensation

ECIEmployment Cost Index

eCQMElectronic clinical quality measures

EHRElectronic health record

EMTALAEmergency Medical Treatment and Labor Act

eRxElectronic prescribing

ESRDEnd-stage renal disease

FARFederal Acquisition Regulations

FFSFee-for-service

FOBTFecal occult blood test

FQHCFederally qualified health center

FRFederal Register

GAFGeographic adjustment factor

GAOGovernment Accountability Office

GPCIGeographic practice cost index

GPROGroup practice reporting option

HCPCSHealthcare Common Procedure Coding System

HHS[Department of] Health and Human Services

HOPDHospital outpatient department

HPSAHealth professional shortage area

IDEInvestigational device exemption

IDTFIndependent diagnostic testing facility

IOMInstitute of Medicine

IPPEInitial Preventive Physical Examination

IPPSInpatient Prospective Payment System

IQRInpatient Quality Reporting

IWPUTIntensity of work per unit of time

KDEKidney disease education

LCDLocal coverage determination

LDTLaboratory-developed test

MAMedicare Advantage

MACMedicare Administrative Contractor

MAPCPMulti-payer Advanced Primary Care Practice

MCTRJCAMiddle Class Tax Relief and Job Creation Act of 2012 (Pub. L. 112-96)

MDCMajor diagnostic category

MedPACMedicare Payment Advisory Commission

MEIMedicare Economic Index

MFPMulti-Factor Productivity

MGMAMedical Group Management Association

MIEA-TRHCAThe Medicare Improvements and Extension Act, Division B of the Tax Relief and Health Care Act (Pub. L. 109-432)

MIPPAMedicare Improvements for Patients and Providers Act (Pub. L. 110-275)

MMEAMedicare and Medicaid Extenders Act (Pub. L. 111-309)

MMSEAMedicare, Medicaid, and State Children's Health Insurance Program Extension Act (Pub. L. 110-73)

MPMalpractice

MPPRMultiple procedure payment reduction

MRAMagnetic resonance angiography

MRIMagnetic resonance imaging

MSAMetropolitan Statistical Areas

MSPBMedicare Spending per Beneficiary

MSSPMedicare Shared Savings Program

MUMeaningful use

NCDNational coverage determination

NCQDISNational Coalition of Quality Diagnostic Imaging Services

NPNurse practitioner

NPINational Provider Identifier

NPPNonphysician practitioner

OACTCMS's Office of the Actuary

OBRA '89Omnibus Budget Reconciliation Act of 1989

OBRA '90Omnibus Budget Reconciliation Act of 1990

OESOccupational Employment Statistics

OMBOffice of Management and Budget

OPPSOutpatient prospective payment system

PCProfessional component

PCIPPrimary Care Incentive Payment

PDPPrescription Drug Plan

PEPractice expense

PE/HRPractice expense per hour

PEACPractice Expense Advisory Committee

PECOSProvider Enrollment, Chain, and Ownership System

PFSPhysician Fee Schedule

PLIProfessional Liability Insurance

PMAPremarket approval

POSPlace of Service

PQRSPhysician Quality Reporting System

PPISPhysician Practice Expense Information Survey

QRURQuality and Resources Use Report

RBRVSResource-based relative value scale

RFARegulatory Flexibility Act

RHCRural health clinic

RIARegulatory impact analysis

RoPRRegistry of Patient Registries

RUCARural Urban Commuting Area

RVURelative value unit

SBASmall Business Administration

SGRSustainable growth rate

SMSSocioeconomic Monitoring System

SNFSkilled nursing facility

SOIStatistics of Income

TAPTechnical Advisory Panel

TCTechnical component

TINTax identification number

TPTCCATemporary Payroll Tax Cut Continuation Act (Pub. L. 112-78)

UAFUpdate adjustment factor

USPSTFUnited States Preventive Services Task Force

VBPValue-based purchasing

VBMValue-Based Modifier

Addenda Available Only Through the Internet on the CMS Web site Back to Top

The PFS Addenda along with other supporting documents and tables referenced in this final rule with comment period are available through the Internet on the CMS Web site at http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PhysicianFeeSched/PFS-Federal-Regulation-Notices.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 2014 PFS final rule with comment period, refer to item CMS-1600-FC. Readers who experience any problems accessing any of the Addenda or other documents referenced in this final rule with comment period and posted on the CMS Web site identified above should contact Elliot.Isaac@cms.hhs.gov.

CPT (Current Procedural Terminology) Copyright Notice Back to Top

Throughout this final rule with comment period, we use CPT codes and descriptions to refer to a variety of services. We note that CPT codes and descriptions are copyright 2013 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 and Background Back to Top

A. Executive Summary

1. Purpose

This major final rule with comment period revises payment polices under the Medicare Physician Fee Schedule (PFS) and makes other policy changes related to Medicare Part B payment. Unless otherwise noted, these changes are applicable to services furnished in CY 2014.

2. Summary of the Major Provisions

The Social Security Act (Act) 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 Act requires that RVUs be established for three categories of resources: work, practice expense (PE); and malpractice (MP) expense; and that we establish by regulation each year payment amounts for all physicians' services, incorporating geographic adjustments to reflect the variations in the costs of furnishing services in different geographic areas. In this major final rule with comment period, we establish RVUs for CY 2014 for the PFS, and other Medicare Part B payment policies, 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. In addition, this final rule with comment period includes discussions and/or policy changes regarding:

  • Misvalued PFS Codes.
  • Telehealth Services.
  • Applying Therapy Caps to Outpatient Therapy Services Furnished by CAHs.
  • Requiring Compliance with State law as a Condition of Payment for Services Furnished Incident to Physicians' (and Other Practitioners') Services.
  • Revising the MEI based on MEI TAP Recommendations.
  • Updating the Ambulance Fee Schedule regulations.
  • Adjusting the Clinical Laboratory Fee Schedule based on technological changes
  • Updating the—

++ Physician Compare Web site.

++ Physician Quality Reporting System.

++ Electronic Prescribing (eRx) Incentive Program.

++ Medicare Shared Savings Program.

++ Electronic Health Record (EHR) Incentive Program.

  • Budget Neutrality for the Chiropractic Services Demonstration.
  • Physician Value-Based Payment Modifier and the Physician Feedback Reporting Program.

3. Summary of Costs and Benefits

We have determined that this final rule with comment period is economically significant. For a detailed discussion of the economic impacts, see section VII. of this final rule with comment period.

B. Background

Since January 1, 1992, Medicare has paid for physicians' services under section 1848 of the Act, “Payment for Physicians' Services.” The system relies on national relative values that are established for work, PE, and MP, which are then adjusted for geographic cost variations. These values are multiplied by a conversion factor (CF) to convert the 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) (101, enacted on December 19, 1989), and the Omnibus Budget Reconciliation Act of 1990 (OBRA '90 (101, enacted on November 5, 1990). The final rule published on November 25, 1991 (56 FR 59502) set forth the first fee schedule used for payment for physicians' services.

We note that throughout this final rule with comment period, unless otherwise noted, the term “practitioner” is used to describe both physicians and nonphysician practitioners who are permitted to bill Medicare under the PFS for services furnished to Medicare beneficiaries.

1. Development of the Relative Values

a. Work RVUs

The physician work RVUs established for the implementation of the fee schedule in January 1992 were developed with extensive input from the physician community. A research team at the Harvard School of Public Health developed the original physician work RVUs for most codes under a cooperative agreement with the Department of Health and Human Services (HHS). In constructing the code-specific vignettes used in determining the original physician work RVUs, Harvard worked with panels of experts, both inside and outside the federal government, and obtained input from numerous physician specialty groups.

We establish work RVUs for new and revised codes based, in part, on our review of recommendations received from the American Medical Association/Specialty Society Relative Value Update Committee (AMA RUC).

b. Practice Expense RVUs

Initially, only the work RVUs were resource-based, and the PE and MP RVUs were based on average allowable charges. Section 121 of the Social Security Act Amendments of 1994 (103, enacted on October 31, 1994), amended section 1848(c)(2)(C)(ii) of the Act and required us to develop resource-based PE RVUs for each physicians' service beginning in 1998. We were required to consider general categories of expenses (such as office rent and wages of personnel, but excluding malpractice expenses) comprising PEs. Originally, this method was to be used beginning in 1998, but section 4505(a) of the Balanced Budget Act of 1997 (BBA) (Pub. L. 105-33, enacted on August 5, 1997) delayed implementation of the resource-based PE RVU system until January 1, 1999. In addition, section 4505(b) of the BBA provided for a 4-year transition period from the charge-based PE RVUs to the resource-based PE RVUs.

We established the resource-based PE RVUs for each physicians' service in a final rule, published November 2, 1998 (63 FR 58814), effective for services furnished in CY 1999. Based on the requirement to transition to a resource-based system for PE over a 4-year period, payment rates were not fully based upon resource-based PE RVUs until CY 2002. This resource-based system was based on two significant sources of actual PE data: The Clinical Practice Expert Panel (CPEP) data and the AMA's Socioeconomic Monitoring System (SMS) data. (These data sources are described in greater detail in the CY 2012 final rule with comment period (76 FR 73033).)

Separate PE RVUs are established for services furnished in facility settings, such as a hospital outpatient department (HOPD) or an ambulatory surgical center (ASC), and in non-facility settings, such as a physician's office. The nonfacility RVUs reflect all of the direct and indirect PEs involved in furnishing a service described by a particular HCPCS code. The difference, if any, in these PE RVUs generally results in a higher payment in the nonfacility setting because in the facility settings some costs are borne by the facility. Medicare's payment to the facility (such as the outpatient prospective payment system (OPPS) payment to the HOPD) would reflect costs typically incurred by the facility. Thus, payment associated with those facility resources is not made under the PFS.

Section 212 of the Balanced Budget Refinement Act of 1999 (BBRA) (Pub. L. 106-113, enacted on November 29, 1999) directed the Secretary of Health and Human Services (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. On May 3, 2000, we published the interim final rule (65 FR 25664) that set forth the criteria for the submission of these supplemental PE survey data. The criteria were modified in response to comments received, and published in the Federal Register (65 FR 65376) as part of a November 1, 2000 final rule. The PFS final rules published in 2001 and 2003, respectively, (66 FR 55246 and 68 FR 63196) extended the period during which we would accept these supplemental data through March 1, 2005.

In the CY 2007 PFS final rule with comment period (71 FR 69624), we revised the methodology for calculating direct PE RVUs from the top-down to the bottom-up methodology beginning in CY 2007. We adopted a 4-year transition to the new PE RVUs. This transition was completed for CY 2010. In the CY 2010 PFS final rule with comment period, we updated the practice expense per hour (PE/HR) data that are used in the calculation of PE RVUs for most specialties (74 FR 61749). In CY 2010, we began a 4-year transition to the new PE RVUs using the updated PE/HR data, which was completed for CY 2013.

c. Malpractice RVUs

Section 4505(f) of the BBA amended section 1848(c) of the Act to require that we implement resource-based MP RVUs for services furnished on or after CY 2000. The resource-based MP RVUs were implemented in the PFS final rule with comment period published November 2, 1999 (64 FR 59380). The MP RVUs are based on malpractice insurance premium data collected from commercial and physician-owned insurers from all the states, the District of Columbia, and Puerto Rico.

d. Refinements to the RVUs

Section 1848(c)(2)(B)(i) of the Act requires that we review RVUs no less often than every 5 years. Prior to CY 2013, we conducted periodic reviews of work RVUs and PE RVUs independently. We completed Five-Year Reviews of Work RVUs that were effective for calendar years 1997, 2002, 2007, and 2012.

While refinements to the direct PE inputs initially relied heavily on input from the AMA RUC Practice Expense Advisory Committee (PEAC), the shifts to the bottom-up PE methodology in CY 2007 and to the use of the updated PE/HR data in CY 2010 have resulted in significant refinements to the PE RVUs in recent years.

In the CY 2012 PFS final rule with comment period (76 FR 73057), we finalized a proposal to consolidate reviews of work and PE RVUs under section 1848(c)(2)(B) of the Act and reviews of potentially misvalued codes under section 1848(c)(2)(K) of the Act into one annual process.

With regard to MP RVUs, we completed Five-Year Reviews of MP that were effective in CY 2005 and CY 2010.

In addition to the Five-Year Reviews, beginning for CY 2009, CMS and the AMA RUC have identified and reviewed a number of potentially misvalued codes on an annual basis based on various identification screens. This annual review of work and PE RVUs for potentially misvalued codes was supplemented by the amendments to section 1848 of the Act, as enacted by section 3134 of the Affordable Care Act, which requires the agency to periodically identify, review and adjust values for potentially misvalued codes with an emphasis on seven specific categories (see section II.C.2. of this final rule with comment period).

e. Application of Budget Neutrality to Adjustments of RVUs

As described in section VII.C.1. of this final rule with comment period, in accordance with section 1848(c)(2)(B)(ii)(II) of the Act, if revisions to the RVUs would cause expenditures for the year to change by more than $20 million, we make adjustments to ensure that expenditures do not increase or decrease by more than $20 million.

2. Calculation of Payments Based on RVUs

To calculate the payment for each physicians' service, the components of the fee schedule (work, PE, and MP RVUs) are adjusted by geographic practice cost indices (GPCIs) to reflect the variations in the costs of furnishing the services. The GPCIs reflect the relative costs of physician work, PE, and MP in an area compared to the national average costs for each component. (See section II.F.2 of this final rule with comment period for more information about GPCIs.)

RVUs are converted to dollar amounts through the application of a CF, which is calculated based on a statutory formula by CMS's Office of the Actuary (OACT). The CF for a given year is calculated using (a) the productivity-adjusted increase in the Medicare Economic Index (MEI) and (b) the Update Adjustment Factor (UAF), which is calculated by taking into account the Medicare Sustainable Growth Rate (SGR), an annual growth rate intended to control growth in aggregate Medicare expenditures for physicians' services, and the allowed and actual expenditures for physicians' services. For a more detailed discussion of the calculation of the CF, the SGR, and the MEI, we refer readers to section II.G. of this final rule with comment period.

The formula for calculating the Medicare fee schedule payment amount for a given service and fee schedule area can be expressed as:

Payment = [(RVU work × GPCI work) + (RVU PE × GPCI PE) + (RVU MP × GPCI MP)] × CF.

3. Separate Fee Schedule Methodology for Anesthesia Services

Section 1848(b)(2)(B) of the Act specifies that the fee schedule amounts for anesthesia services are to be based on a uniform relative value guide, with appropriate adjustment of an anesthesia conversion factor, in a manner to assure that fee schedule amounts for anesthesia services are consistent with those for other services of comparable value. Therefore, there is a separate fee schedule methodology for anesthesia services. Specifically, we establish a separate conversion factor for anesthesia services and we utilize the uniform relative value guide, or base units, as well as time units, to calculate the fee schedule amounts for anesthesia services. Since anesthesia services are not valued using RVUs, a separate methodology for locality adjustments is also necessary. This involves an adjustment to the national anesthesia CF for each payment locality.

4. Most Recent Changes to the Fee Schedule

The CY 2013 PFS final rule with comment period (77 FR 68892) implemented changes to the PFS and other Medicare Part B payment policies. It also finalized many of the CY 2012 interim final RVUs and established interim final RVUs for new and revised codes for CY 2013 to ensure that our payment system is updated to reflect changes in medical practice, coding changes, and the relative values of services. It also implemented certain statutory provisions including provisions of the Affordable Care Act (Pub. L. 111-148) and the Middle Class Tax Relief and Jobs Creation Act (MCTRJCA) (Pub. L. 112-96), including claims-based data reporting requirements for therapy services.

In the CY 2013 PFS final rule with comment period, we announced the following for CY 2013: the total PFS update of −26.5 percent; the initial estimate for the SGR of −19.7 percent; and the CY 2013 CF of $25.0008. These figures were calculated based on the statutory provisions in effect on November 1, 2012, when the CY 2013 PFS final rule with comment period was issued.

On January 2, 2013, the American Taxpayer Relief Act (ATRA) of 2012 (Pub. L. 112-240) was signed into law. Section 601(a) of the ATRA specified a zero percent update to the PFS CF for CY 2013. As a result, the CY 2013 PFS conversion factor was revised to $34.0320. In addition, the ATRA extended and added several provisions affecting Medicare services furnished in CY 2013, including:

  • Section 602—extending the 1.0 floor on the work geographic practice cost index through CY 2013;
  • Section 603—extending the exceptions process for outpatient therapy caps through CY 2013, extending the application of the cap and manual medical review threshold to services furnished in the HOPD through CY 2013, and requiring the counting of a proxy amount for therapy services furnished in a Critical Access Hospital (CAH) toward the cap and threshold during CY 2013.

In addition to the changes effective for CY 2013, section 635 of ATRA revised the equipment utilization rate assumption for advanced imaging services furnished on or after January 1, 2014.

A correction document (78 FR 48996) was issued to correct several technical and typographical errors that occurred in the CY 2013 PFS final rule with comment period.

II. Provisions of the Final Rule With Comment Period for PFS Back to Top

A. Resource-Based Practice Expense (PE) Relative Value Units (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 expenses, as specified in section 1848(c)(1)(B) of the Act. Section 121 of the Social Security Amendments of 1994 (103), enacted on October 31, 1994, amended section 1848(c)(2)(C)(ii) of the Act to require us to develop a methodology for a resource-based system for determining PE RVUs for each physician's service. We develop PE RVUs by looking at 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 PFS final rule with comment period (74 FR 61743 through 61748) for a more detailed explanation of the PE methodology.

In addition, we note that section 1848(c)(2)(B)(ii)(II) of the Act provides that adjustments in RVUs for a year may not cause total PFS payments to differ by more than $20 million from what they would have otherwise been if the adjustments were not made. Therefore, if revisions to the RVUs cause expenditures to change by more than $20 million, we make adjustments to ensure that expenditures do not increase or decrease by more than $20 million.

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, equipment, and supplies) 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 based on our review of recommendations received from the AMA 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 Five-Year Review of Work Relative Value Units Under the PFS and Proposed Changes to the Practice Expense Methodology proposed notice (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 practice expense per hour (PE/HR) by specialty that was obtained from the AMA's Socioeconomic Monitoring Surveys (SMS). The AMA administered a new survey in CY 2007 and CY 2008, the Physician Practice Expense Information Survey (PPIS). The PPIS is a multispecialty, nationally representative, PE survey of both physicians and nonphysician practitioners (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 (75 percent old/25 percent new for CY 2010, 50 percent old/50 percent new for CY 2011, 25 percent old/75 percent new for CY 2012, and 100 percent new for CY 2013) 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, the CY 2013 and CY 2014 PE RVUs 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 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.

We do not use the PPIS data for sleep medicine since there is not a full year of Medicare utilization data for that specialty given the specialty code was only available beginning in October 1, 2012. We anticipate using the PPIS data to create PE/HR for sleep medicine for CY 2015 when we will have a full year of data to make the calculations.

Previously, we established PE/HR values for various specialties without SMS or supplemental survey data by crosswalking 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 crosswalked PE/HR, we instead used the PPIS-based PE/HR. We continue previous crosswalks for specialties that did not participate in the PPIS. However, beginning in CY 2010 we changed the PE/HR crosswalk for portable x-ray suppliers from radiology to IDTF, a more appropriate crosswalk because these specialties are more similar to each other with respect to physician time.

For registered dietician services, the resource-based PE RVUs have been calculated in accordance with the final policy that crosswalks the specialty to the “All Physicians” PE/HR data, as adopted in the CY 2010 PFS final rule with comment period (74 FR 61752) and discussed in more detail in the CY 2011 PFS final rule with comment period (75 FR 73183).

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, equipment, and supplies) 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

Section II.B.2.b. of this final rule with comment period describes the current data sources for specialty-specific indirect costs used in our PE calculations. We allocated the indirect costs to the code level on the basis of the direct costs specifically associated with a code and the greater of either the clinical labor costs or the physician work RVUs. We also incorporated the survey data described earlier in the PE/HR discussion. The general approach to developing the indirect portion of the PE RVUs is described 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. In other words, 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, represented 25 percent of total costs for the specialties that furnished 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 RVUs 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 work RVUs of 4.00 and the clinical labor portion of the direct PE RVUs 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.
  • Next, 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.

d. Facility and Nonfacility Costs

For procedures that can be furnished in a physician's office, as well as in a hospital or facility setting, 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. Because 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 in a facility, the facility PE RVUs are generally lower than the nonfacility PE RVUs. Medicare makes a separate payment to the facility for its costs of furnishing a service.

e. Services With Technical Components (TCs) and Professional Components (PCs)

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 under the bottom-up methodology.)

f. PE RVU Methodology

For a more detailed description of the PE RVU methodology, we refer readers to the CY 2010 PFS final rule with comment period (74 FR 61745 through 61746).

(1) 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.

(2) 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. Apply a scaling adjustment to the direct inputs.

Step 2: Calculate the aggregate pool of direct PE costs for the current year. This is the product of the current aggregate PE (direct and indirect) RVUs, the CF, and the average direct PE percentage from the survey data used for calculating the PE/HR by specialty.

Step 3: Calculate the aggregate pool of direct PE costs for use in ratesetting. This is the product of the aggregated direct costs for all services from Step 1 and the utilization data for that service. For CY 2014, we adjusted the aggregate pool of direct PE costs in proportion to the change in the PE share in the revised MEI, as discussed in section II.D. of this final rule with comment period.

Step 4: Using the results of Step 2 and Step 3, 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 factor 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 2 and Step 5. Different CFs will result in different direct PE scaling factors, but this has no effect on the final direct cost PE RVUs since changes in the CFs and changes in the associated direct scaling factors offset one another.

(3) 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.

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 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 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 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 will be allocated using the work RVUs, and for the TC service, indirect PEs will 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 Table 1, 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 current aggregate pool of PE RVUs 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. For CY 2014, we adjusted the indirect cost pool in proportion to the change in the PE share in the revised MEI, as discussed in section II.D. of this final rule with comment period.

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 physician 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.

(4) Calculate the Final PE RVUs

Step 18: Add the direct PE RVUs from Step 6 to the indirect PE RVUs from Step 17 and apply the final PE budget neutrality (BN) adjustment and the MEI revision adjustment.

The final PE BN adjustment is calculated by comparing the results of Step 18 to the current pool of PE RVUs (prior to the adjustments corresponding with the MEI revision described in section II.D. of this final rule with comment period). This final BN adjustment is required to redistribute RVUs from step 18 to all PE RVUs in the PFS, and because certain specialties are excluded from the PE RVU calculation for ratesetting purposes, but we note that all specialties are included for purposes of calculating the final BN adjustment. (See “Specialties excluded from ratesetting calculation” later in this section.)

(5) Setup File Information

  • Specialties excluded from ratesetting calculation: For the purposes of calculating the PE RVUs, we exclude certain specialties, such as certain nonphysician practitioners 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.
Table 1—Specialties Excluded From Ratesetting Calculation Back to Top
Specialty code Specialty description
49 Ambulatory surgical center.
50 Nurse practitioner.
51 Medical supply company with certified orthotist.
52 Medical supply company with certified prosthetist.
53 Medical supply company with certified prosthetist-orthotist.
54 Medical supply company not included in 51, 52, or 53.
55 Individual certified orthotist.
56 Individual certified prosthestist.
57 Individual certified prosthetist-orthotist.
58 Individuals not included in 55, 56, or 57.
59 Ambulance service supplier, e.g., private ambulance companies, funeral homes, etc.
60 Public health or welfare agencies.
61 Voluntary health or charitable agencies.
73 Mass immunization roster biller.
74 Radiation therapy centers.
87 All other suppliers (e.g., drug and department stores).
88 Unknown supplier/provider specialty.
89 Certified clinical nurse specialist.
95 Competitive Acquisition Program (CAP) Vendor.
96 Optician.
97 Physician assistant.
A0 Hospital.
A1 SNF.
A2 Intermediate care nursing facility.
A3 Nursing facility, other.
A4 HHA.
A5 Pharmacy.
A6 Medical supply company with respiratory therapist.
A7 Department store.
1 Supplier of oxygen and/or oxygen related equipment.
2 Pedorthic personnel.
3 Medical supply company with pedorthic personnel.
  • Crosswalk certain low volume physician specialties: Crosswalk the utilization of certain specialties with relatively low PFS utilization to the associated specialties.
  • Physical therapy utilization: Crosswalk 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 physician 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.
Table 2—Application of Payment Modifiers to Utilization Files Back to Top
Modifier Description Volume adjustment Time adjustment
80,81,82 Assistant at Surgery 16% Intraoperative portion.
AS Assistant at Surgery—Physician Assistant 14% (85% * 16%) Intraoperative portion.
50 or LT and RT Bilateral Surgery 150% 150% of physician time.
51 Multiple Procedure 50% Intraoperative portion.
52 Reduced Services 50% 50%.
53 Discontinued Procedure 50% 50%.
54 Intraoperative Care only Preoperative + Intraoperative Percentages on the payment files used by Medicare contractors to process Medicare claims Preoperative + Intraoperative portion.
55 Postoperative Care only Postoperative Percentage on the payment files used by Medicare contractors to process Medicare claims Postoperative portion.
62 Co-surgeons 62.5% 50%.
66 Team Surgeons 33% 33%.

We also make adjustments to volume and time that correspond to other payment rules, including special multiple procedure endoscopy rules and multiple procedure payment reductions (MPPR). 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.

For anesthesia services, we do not apply adjustments to volume since the average allowed charge is used when simulating RVUs, and therefore, includes all adjustments. A time adjustment of 33 percent is made only for medical direction of two to four cases since that is the only situation where time units are duplicative.

  • Work RVUs: The setup file contains the work RVUs from this final rule with comment period.

(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.

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.

Usage: We currently use an equipment utilization rate assumption of 50 percent for most equipment, with the exception of expensive diagnostic imaging equipment. For CY 2013, expensive diagnostic imaging equipment, which is equipment priced at over $1 million (for example, computed tomography (CT) and magnetic resonance imaging (MRI) scanners), we use an equipment utilization rate assumption of 75 percent. Section 1848(b)(4)(C) of the Act, as modified by section 635 of the ATRA), requires that for fee schedules established for CY 2014 and subsequent years, in the methodology for determining PE RVUs for expensive diagnostic imaging equipment, the Secretary shall use a 90 percent assumption. The provision also requires that the reduced expenditures attributable to this change in the utilization rate for CY 2014 and subsequent years shall not be taken into account when applying the BN limitation on annual adjustments described in section 1848(c)(2)(B)(ii)(II) of the Act. We are applying the 90 percent utilization rate assumption in CY 2014 to all of the services to which the 75 percent equipment utilization rate assumption applied in CY 2013. These services are listed in a file called “CY 2014 CPT Codes Subject to 90 Percent Usage Rate,” available on the CMS Web site under downloads for the CY 2014 PFS final rule with comment period at http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PhysicianFeeSched/PFS-Federal-Regulation-Notices.html. These codes are also displayed in Table 3.

Table 3—CPT Codes Subject to 90 Percent Equipment Utilization Rate Assumption Back to Top
CPT code Short descriptor
70336 Mri, temporomandibular joint(s).
70450 Ct head/brain w/o dye.
70460 Ct head/brain w/dye.
70470 Ct head/brain w/o & w/dye.
70480 Ct orbit/ear/fossa w/o dye.
70481 Ct orbit/ear/fossa w/dye.
70482 Ct orbit/ear/fossa w/o & w/dye.
70486 Ct maxillofacial w/o dye.
70487 Ct maxillofacial w/dye.
70488 Ct maxillofacial w/o & w/dye.
70490 Ct soft tissue neck w/o dye.
70491 Ct soft tissue neck w/dye.
70492 Ct soft tissue neck w/o & w/dye.
70496 Ct angiography, head.
70498 Ct angiography, neck.
70540 Mri orbit/face/neck w/o dye.
70542 Mri orbit/face/neck w/dye.
70543 Mri orbit/face/neck w/o & w/dye.
70544 Mr angiography head w/o dye.
70545 Mr angiography head w/dye.
70546 Mr angiography head w/o & w/dye.
70547 Mr angiography neck w/o dye.
70548 Mr angiography neck w/dye.
70549 Mr angiography neck w/o & w/dye.
70551 Mri brain w/o dye.
70552 Mri brain w/dye.
70553 Mri brain w/o & w/dye.
70554 Fmri brain by tech.
71250 Ct thorax w/o dye.
71260 Ct thorax w/dye.
71270 Ct thorax w/o & w/dye.
71275 Ct angiography, chest.
71550 Mri chest w/o dye.
71551 Mri chest w/dye.
71552 Mri chest w/o & w/dye.
71555 Mri angio chest w/ or w/o dye.
72125 CT neck spine w/o dye.
72126 Ct neck spine w/dye.
72127 Ct neck spine w/o & w/dye.
72128 Ct chest spine w/o dye.
72129 Ct chest spine w/dye.
72130 Ct chest spine w/o & w/dye.
72131 Ct lumbar spine w/o dye.
72132 Ct lumbar spine w/dye.
72133 Ct lumbar spine w/o & w/dye.
72141 Mri neck spine w/o dye.
72142 Mri neck spine w/dye.
72146 Mri chest spine w/o dye.
72147 Mri chest spine w/dye.
72148 Mri lumbar spine w/o dye.
72149 Mri lumbar spine w/dye.
72156 Mri neck spine w/o & w/dye.
72157 Mri chest spine w/o & w/dye.
72158 Mri lumbar spine w/o & w/dye.
72159 Mr angio spine w/o & w/dye.
72191 Ct angiography, pelv w/o & w/dye.
72192 Ct pelvis w/o dye.
72193 Ct pelvis w/dye.
72194 Ct pelvis w/o & w/dye.
72195 Mri pelvis w/o dye.
72196 Mri pelvis w/dye.
72197 Mri pelvis w/o & w/dye.
72198 Mri angio pelvis w/or w/o dye.
73200 Ct upper extremity w/o dye.
73201 Ct upper extremity w/dye.
73202 Ct upper extremity w/o & w/dye.
73206 Ct angio upper extr w/o & w/dye.
73218 Mri upper extr w/o dye.
73219 Mri upper extr w/dye.
73220 Mri upper extremity w/o & w/dye.
73221 Mri joint upper extr w/o dye.
73222 Mri joint upper extr w/dye.
73223 Mri joint upper extr w/o & w/dye.
73225 Mr angio upr extr w/o & w/dye.
73700 Ct lower extremity w/o dye.
73701 Ct lower extremity w/dye.
73702 Ct lower extremity w/o & w/dye.
73706 Ct angio lower ext w/o & w/dye.
73718 Mri lower extremity w/o dye.
73719 Mri lower extremity w/dye.
73720 Mri lower ext w/& w/o dye.
73721 Mri joint of lwr extre w/o dye.
73722 Mri joint of lwr extr w/dye.
73723 Mri joint of lwr extr w/o & w/dye.
73725 Mr angio lower ext w or w/o dye.
74150 Ct abdomen w/o dye.
74160 Ct abdomen w/dye.
74170 Ct abdomen w/o & w/dye.
74174 Ct angiography, abdomen and pelvis w/o & w/dye.
74175 Ct angiography, abdom w/o & w/dye.
74176 Ct abdomen and pelvis w/o dye.
74177 Ct abdomen and pelvis w/dye.
74178 Ct abdomen and pelvis w/ and w/o dye.
74181 Mri abdomen w/o dye.
74182 Mri abdomen w/dye.
74183 Mri abdomen w/o and w/dye.
74185 Mri angio, abdom w/or w/o dye.
74261 Ct colonography, w/o dye.
74262 Ct colonography, w/dye.
75557 Cardiac mri for morph.
75559 Cardiac mri w/stress img.
75561 Cardiac mri for morph w/dye.
75563 Cardiac mri w/stress img & dye.
75565 Card mri vel flw map add-on.
75571 Ct hrt w/o dye w/ca test.
75572 Ct hrt w/3d image.
75573 Ct hrt w/3d image, congen.
75574 Ct angio hrt w/3d image.
75635 Ct angio abdominal arteries.
76380 CAT scan follow up study.
77058 Mri, one breast.
77059 Mri, broth breasts.
77078 Ct bone density, axial.
77084 Magnetic image, bone marrow.

Comment: Several commenters objected to the statutorily-mandated change in equipment utilization rate assumptions, but none provided evidence that CMS has authority to use a different equipment utilization assumption for these services.

Response: As mandated by statute, we are finalizing our proposed change in the equipment utilization rate for these services.

Interest Rate: In the CY 2013 final rule with comment period (77 FR 68902), we updated the interest rates used in developing an equipment cost per minute calculation. 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 4. (See 77 FR 68902 for a thorough discussion of this issue.)

Table 4—SBA Maximum Interest Rates Back to Top
Price Useful life Interest rate (percent)
See 77 FR 68902 for a thorough discussion of this issue.
<$25K <7 Years 7.50
$25K to $50K <7 Years 6.50
>$50K <7 Years 5.50
<$25K 7+ Years 8.00
$25K to $50K 7+ Years 7.00
>$50K 7+ Years 6.00
Table 5—Calculation of PE RVUs Under Methodology for Selected Codes Back to Top
Step Source Formula 99213 Office visit, est Non-facility 33533 CABG, arterial, single Facility 71020 Chest x-ray Non-facility 71020-TC Chest x-ray, Non-facility 71020-26 Chest x-ray, Non-facility 93000 ECG, complete, Non-facility 93005 ECG, tracing Non-facility 93010 ECG, report Non-facility
Note: PE RVUs in Table 5, row 27, may not match Addendum B due to rounding.
* The direct adj = [current pe rvus * CF * avg dir pct]/[sum direct inputs] = [step2]/[step3]
** The indirect adj = [current pe rvus * avg ind pct]/[sum of ind allocators] = [step9]/[step10]
Note: The use of any particular conversion factor (CF) in Table 5 to illustrate the PE Calculation has no effect on the resulting RVUs.
Note: The Other Adjustment includes an adjustment for the equipment utilization change.
(1) Labor cost (Lab) Step 1 AMA 13.32 77.52 5.74 5.74 0.00 5.10 5.10 0.00
(2) Supply cost (Sup) Step 1 AMA 2.98 7.34 3.39 3.39 0.00 1.19 1.19 0.00
(3) Equipment cost (Eqp) Step 1 AMA 0.17 0.58 7.24 7.24 0.00 0.09 0.09 0.00
(4) Direct cost (Dir) Step 1 =(1)+(2)+(3) 16.48 85.45 16.38 16.38 0.00 6.38 6.38 0.00
(5) Direct adjustment (Dir. Adj.) Steps 2-4 See footnote * 0.5511 0.5511 0.5511 0.5511 0.5511 0.5511 0.5511 0.5511
(6) Adjusted Labor Steps 2-4 =Lab * Dir Adj =(1)*(5) 7.34 42.72 3.16 3.16 0.00 2.81 2.81 0.00
(7) Adjusted Supplies Steps 2-4 =Eqp * Dir Adj =(2)*(5) 1.64 4.05 1.87 1.87 0.00 0.66 0.66 0.00
(8) Adjusted Equipment Steps 2-4 =Sup * Dir Adj =(3)*(5) 0.10 0.32 3.99 3.99 0.00 0.05 0.05 0.00
(9) Adjusted Direct Steps 2-4 =(6)+(7)+(8) 9.08 47.09 9.03 9.03 0.00 3.52 3.52 0.00
(10) Conversion Factor (CF) Step 5 PFS 34.0230 34.0230 34.0230 34.0230 34.0230 34.0230 34.0230 34.0230
(11) Adj. labor cost converted Step 5 =(Lab * Dir Adj)/CF =(6)/(10) 0.22 1.26 0.09 0.09 0.00 0.08 0.08 0.00
(12) Adj. supply cost converted Step 5 =(Sup * Dir Adj)/CF =(7)/(10) 0.05 0.12 0.05 0.05 0.00 0.02 0.02 0.00
(13) Adj. equipment cost converted Step 5 =(Eqp * Dir Adj)/CF =(8)/(10) 0.00 0.01 0.12 0.12 0.00 0.00 0.00 0.00
(14) Adj. direct cost converted Step 5 =(11)+(12)+(13) 0.27 1.38 0.27 0.27 0.00 0.10 0.10 0.00
(15) Work RVU Setup File PFS 0.97 33.75 0.22 0.00 0.22 0.17 0.00 0.17
(16) Dir_pct Steps 6,7 Surveys 0.31 0.18 0.31 0.31 0.31 0.31 0.31 0.31
(17) Ind_pct Steps 6,7 Surveys 0.69 0.82 0.69 0.69 0.69 0.69 0.69 0.69
(18) Ind. Alloc. Formula (1st part) Step 8 See Step 8 ((14)/(16))*(17) ((14)/(16))*(17) ((14)/(16))*(17) ((14)/(16))*(17) ((14)/(16))*(17) ((14)/(16))*(17) ((14)/(16))*(17) ((14)/(16))*(17)
(19) Ind. Alloc.(1st part) Step 8 See 18 0.81 6.51 0.65 0.65 0 0.26 0.26 0
(20) Ind. Alloc. Formula (2nd part) Step 8 See Step 8 (15) (15) (15+11) (11) (15) (15+11) (11) (15)
(21) Ind. Alloc.(2nd part) Step 8 See 20 0.97 33.75 0.31 0.09 0.22 0.25 0.08 0.17
(22) Indirect Allocator (1st + 2nd) Step 8 =(19)+(21) 1.78 40.26 0.96 0.74 0.22 0.51 0.34 0.17
(23) Indirect Adjustment (Ind. Adj.) Steps 9-11 See Footnote ** 0.3848 0.3848 0.3848 0.3848 0.3848 0.3848 0.3848 0.3848
(24) Adjusted Indirect Allocator Steps 9-11 =Ind Alloc * Ind Adj 0.68 15.49 0.37 0.29 0.08 0.20 0.13 0.07
(25) Ind. Practice Cost Index (IPCI) Steps 12-16 1.07 0.76 0.95 0.95 0.95 0.91 0.91 0.91
(26) Adjusted Indirect Step 17 = Adj.Ind Alloc * PCI =(24)*(25) 0.73 11.74 0.35 0.27 0.08 0.18 0.12 0.06
(27) PE RVU Step 18 =(Adj Dir + Adj Ind) * Other Adj =((14)+(26)) * Other Adj) 1.00 13.08 0.63 0.55 0.08 0.28 0.22 0.06

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

For CY 2014, as explained in detail in section II.D of this final rule with comment period, we are finalizing revisions to the MEI based on the recommendations of the MEI Technical Advisory Panel (TAP). The MEI is an index that measures the price change of the inputs used to furnish physician services. This measure was authorized by statute and is developed by the CMS Office of the Actuary. We believe that the MEI is the best measure available of the relative weights of the three components in payments under the PFS—work, PE and malpractice. Accordingly, we believe that to assure that the PFS payments reflect the resources in each of these 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 MEI. We proposed to accomplish this by holding the work RVUs constant and adjusting the PE RVUs, the MP RVUs and the CF to produce the appropriate balance in RVUs among components and payments. In the proposed rule and above, we detailed the steps necessary to accomplish this result (see steps 3, 10, and 18).

This proposed adjustment is 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 63246-63247, and CY 2011 PFS Final Rule (75 FR 73275). We note that the revisions to the MEI finalized in section II.D of this final rule are made to the MEI as rebased for CY 2011, and that the RVUs we proposed for CY 2014 reflect the weights of the MEI as rebased for CY 2011 and revised for CY 2014. As such, the relationships among the work, PE, and malpractice RVUs under the PFS are aligned with those under the revised 2006-based MEI.

Comment: Several commenters requested explanation regarding the relationship between the proposed MEI revision and the proposed RVUs. One commenter suggested that it would be better to scale the work RVUs upward instead of scaling the PE RVUs downward to achieve the weighting adjustment.

Response: The change in the relationship among work, PE, and malpractice RVUs could be accomplished by applying adjustments directly to the work, PE, and malpractice RVUs or by holding the RVUs constant for one component, scaling the other two components and applying a budget neutrality adjustment to the conversion factor. We proposed to make the adjustment by holding work RVUs constant consistent with prior adjustments and in response to many public comments made during previous rulemaking (see, for example, 75 FR 73275) indicating a strong preference and persuasive arguments in favor of keeping the work RVUs stable over time since work RVUs generally only change based on reviews of particular services. In contrast, PE RVUs are developed annually, irrespective of changes in the direct PE inputs for particular services, so that scaling of PE RVUs is less disruptive to the public review of values that determine PFS payment rates. We took this approach for the CY 2014 adjustment because we believe the methodology and reasons for making the adjustment in this way are settled and remain valid. For these reasons, we are finalizing the proposed rebasing of the relationship among RVU components by holding the work RVUs constant, decreasing the PE RVUs and the MP RVUs, and applying a budget neutrality adjustment to the CF.

Comment: Several commenters argued that the RVU components should not be weighted consistent with the revised MEI as it was it was entirely appropriate to include nurse practitioner and physician assistant wages in the physician practice expense calculation because physicians often employ nurse practitioners, physician assistants and other non‐physicians.

Response: We refer commenters to section II.D. of the final rule with comment period regarding the appropriate classification of wages in the MEI. Regarding classification of labor inputs in the RVU components, the decision as to whether something should be considered a practice expense or work under the PFS does not depend on the employment status of the health care professional furnishing the service. Resource inputs are classified based on whether they relate to the “work” or “practice expense” portion of a service. The clinical labor portion of the direct PE input database includes the portion of services provided by practitioners who do not bill Medicare directly, such as registered nurses and other clinical labor. We do not include in this category the costs of nurse practitioners and others who can bill Medicare directly. Under the PFS, the work component of a service is valued based on the work involved in furnishing the typical service. The value is the same whether the service is billed by a physician or another practitioner (such as a nurse practitioner or physician assistant) who is permitted to bill Medicare directly for the service. We acknowledge that these practitioners may perform a variety of services in a physician office—some of which would be included in the work portion and others that would be included in the PE portion as clinical labor. Similarly, it is not unusual for physicians to hire other physicians to work in their practices, but we likewise do not consider those costs to be part of the clinical labor that is included as a practice expense. Since values for services under the PFS are based upon the typical case rather than the type of practitioner that performs the service in a particular situation, we continue to believe it is appropriate to include the work performed by professionals eligible to bill Medicare directly in the work component of PFS payments, even in cases when they are employed by physicians.

Additionally, we note that none of the commenters who questioned the appropriate accounting for the work of these nonphysician practitioners addressed how it would be appropriate to treat the costs for these nonphysician practitioners differently for purposes of calculating RVUs and the MEI. The labor of nonphysician practitioners who can bill independently for their services under the PFS is considered as work under the physician fee schedule since these services are also furnished by physicians and the RVUs for these PFS services do not vary based on whether furnished by a physician or nonphysician. As such, we believe that the change in the MEI to shift these costs from the PE to the work category as described in section II.D. of this final rule with comment period is entirely consistent with the PFS in this regard.

We would also note that the change in the MEI was recommended by the MEI TAP that identified a discrepancy between how the work of non-physician practitioners is captured in the RVUs, how billing works under the PFS, and how costs are accounted for in the MEI. With the change in the MEI being finalized in this final rule with comment period, we continue to believe that the MEI weights are the best reflection of the PFS component weights, and we believe it is appropriate to finalize this adjustment in the RVUs as well.

Comment: Several commenters strongly urged the agency, in adjusting weights among the PFS components to reflect the MEI cost weight changes, to consider alternative methodologies that would mitigate the redistribution of RVUs from the PE to the work category. These commenters pointed out that the practitioners who furnish services with a higher proportion of PE RVUs are hit hardest by these changes. These comments also suggested that CMS should consider postponing this adjustment of the RVUs until such a methodology can be vetted.

Several commenters suggested that, given the magnitude of the reductions, CMS should consider a phase-in of this change. These commenters pointed out that CMS has used a phase-in approach in the past to mitigate the effects of methodological changes to the calculation of payment rates under the MPFS, including a four-year phase-in of the transition from the top-down to the bottom-up methodology of calculating direct PE RVUs.

Response: We appreciate that the increase in the work RVUs relative to PE RVUs will generally result in lower payments for practitioners who furnish more services with a higher proportion of PE RVUs. However, we continue to believe that the MEI cost share weights are the best reflection of the PFS component weights. The CY 2014 revisions to the MEI, following the rebasing for 2011 and consideration by the MEI TAP, reflect the best available information. As such, we believe that the relationship among the RVU components should conform to the revised cost weights adopted for the MEI.

While we understand and recognize the general preference to avoid significant year-to-year reductions in Medicare payment, including practitioners' interests in phasing in any reduction, and we acknowledge that this revision of the PFS component weights results in an increase in work RVUs relative to PE RVUs, we note that the 2011 rebasing of the MEI resulted in a change of greater magnitude that increased the PE RVUs relative to work RVUs. That change was not phased in. Based on consideration of these comments, we are finalizing as proposed the adjustment to the relationship among the work, PE, and malpractice component RVUs to reflect the MEI cost share being finalized in this final rule with comment period, with the necessary adjustment to the conversion factor and to PE and MP RVUs to maintain budget neutrality.

4. Changes to Direct PE Inputs for Specific Services

In this section, we discuss other CY 2014 proposals and revisions related to direct PE inputs for specific services. The final direct PE inputs are included in the final rule with comment period CY 2014 direct PE input database, which is available on the CMS Web site under under downloads for the CY 2014 PFS final rule with comment period at http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PhysicianFeeSched/PFS-Federal-Regulation-Notices.html.

a. Anomalous Supply Inputs

In the CY 2013 PFS final rule with comment period, we established interim final direct PE inputs based on acceptance, with refinement, of recommendations submitted by the AMA RUC. Although we generally address public comments on the current year's interim final direct PE inputs in the following year's final rule with comment period, several commenters raised an issue regarding anomalous supply items for codes that were not subject to comment in the CY 2013 final rule with comment period. Since changes were being suggested to codes not subject to comment, we believed these comments were best addressed through proposed revisions to the direct PE inputs in the proposed rule allowing the opportunity for public comment before implementation.

For the CY 2013 interim final direct PE inputs for a series of codes that describe six levels of surgical pathology services (CPT codes 88300, 88302, 88304, 88305, 88307, 88309), we did not accept the AMA RUC recommendation to create two new direct PE supply inputs because we did not consider these items to be disposable supplies (77 FR 69074) and thus they did not meet the criteria for direct PE inputs. These items were called “specimen, solvent, and formalin disposal cost,” and “courier transportation costs.” In the CY 2013 PFS final rule with comment period, we explained that neither the specimen and supply disposal nor courier costs for transporting specimens are appropriately considered disposable medical supplies. Instead, we stated these costs are incorporated into the PE RVUs for these services through the indirect PE allocation. We also noted that the current direct PE inputs for these and similar services across the PFS do not include these kinds of costs as disposable supplies.

Several commenters noted that, contrary to our assertion in the CY 2013 final rule with comment period, there are items incorporated in the direct PE input database as “supplies” that are no more disposable supplies than the new items recommended by the AMA RUC for the surgical pathology codes. These commenters identified seven supply inputs in particular that they believe are analogous to the items that we did not accept in establishing CY 2013 interim final direct PE inputs. These items and their associated HCPCS codes are listed in Table 6.

Table 6—Items Identified by Commenters Back to Top
CMS supply code Item description Affected CPT codes
SK106 device shipping cost 93271, 93229, 93268.
SK112 Federal Express cost (average across all zones) 64650, 88363, 64653.
SK113 communication, wireless per service 93229.
SK107 fee, usage, cycletron/accelerator, gammaknife, Lincac SRS System 77423, 77422.
SK110 fee, image analysis 96102, 96101, 99174.
SK111 fee, licensing, computer, psychology 96102, 96101, 96103, 96120.
SD140 bag system, 1000ml (for angiographywaste fluids) 93451, 93452, 93453, 93454, 93455, 93456, 93457, 93458, 93459, 93460, 93461.

We reviewed each of these items for consistency with the general principles of the PE methodology regarding the categorization of all costs. Within the PE methodology, all costs other than clinical labor, disposable supplies, and medical equipment are considered indirect costs. For six of the items contained in Table 6, we agreed with the commenters that the items should not be considered disposable supplies. We believed that these items are more appropriately categorized as indirect PE costs, which are reflected in the allocation of indirect PE RVUs rather than through direct PE inputs. Therefore, we proposed to remove the following six items from the direct PE input database for CY 2014: “device shipping cost” (SK106); “Federal Express cost (average across all zones)” (SK112); “communication, wireless per service” (SK113); “fee, usage, cycletron/accelerator, gammaknife, Lincac SRS System” (SK107); “fee, image analysis” (SK110); and “fee, licensing, computer, psychology” (SK111).

In the case of the supply item called “bag system, 1000ml (for angiography waste fluids)” (SD140), we did not agree with the commenters that this item is analogous to the specimen disposal costs recommended for the surgical pathology codes. This supply input represents only the costs of the disposable material items associated with the removal of waste fluids that typically result from a particular procedure. In contrast, the item recommended by the AMA RUC for surgical pathology consisted of an amortized portion of a specimen disposal contract that includes costs for resources such as labor and transportation. Furthermore, we did not believe that the specimen disposal contract is attributable to individual procedures within the established PE methodology. We believe that a disposable supply is one that is attributable, in its entirety, to an individual patient for a particular service. An amortized portion of a specimen disposal contract does not meet these criteria. Accordingly, as stated in the CY 2013 final rule with comment period, we did not accept the AMA RUC recommendation to create a new supply item related to specimen disposal costs. We believe that many physician offices and other nonfacility settings where Medicare beneficiaries receive services incur costs related to waste management or other service contracts, but none of these costs are currently incorporated into the PE methodology as disposable supplies. Instead, these costs are appropriately categorized as indirect costs, which are reflected in the PE RVUs through the allocation of indirect PE. We clarified that we believe that supply costs related to specimen disposal attributable to individual services may be appropriately categorized as disposable supplies, but that specimen disposal costs related to an allocated portion of service contracts cannot be attributed to individual services and should not be incorporated into the direct PE input database as disposable supplies.

Moreover, because we do not agree with commenters that the “bag system, 1000ml (for angiography waste fluids)” (SD140) is analogous to a specimen disposal contract for the reasons state above, we continued to believe that SD140 is a direct expense. Accordingly, we did not propose to remove SD140 from the direct PE input database.

Comment: One commenter objected to CMS's proposal to remove the “device shipping cost” (SK106) and “communication, wireless per service” (SK113) from the direct PE input database as they are more analogous to the angiography waste fluid bag system than the other items since both items represent costs associated with a specific procedure rather than an amortization of costs associated with a service contract.

Response: We agree with the commenter that both of these items may represent costs associated with a specific procedure. However, as we articulated in making the proposal to remove these items, we do not believe these items are disposable supplies and we believe all costs other than clinical labor, disposable supplies, and medical equipment should be considered indirect costs in order to maintain consistency and relativity within the PE methodology. We believe that there are a variety of costs allocable to individual services that are appropriately considered part of indirect cost categories for purposes of the PE methodology. Were all these included as direct PE inputs for services across the PFS, regardless of whether or not the items were reasonably described as clinical labor, disposable supplies, or medical equipment, then the relationship between direct and indirect costs would be significantly skewed. This skewing could be compounded since the amount of indirect PE allocated to particular codes is partly determined by the amount of direct costs associated with the codes. Therefore, the inaccurate inclusion of indirect costs as direct costs would not only result in duplicative accounting for the items (as both indirect and direct PE costs) but also an additional allocation of indirect PE based on the item's inclusion as a direct cost. Therefore, we are finalizing removal of these items from the direct PE input database as proposed.

Comment: Several commenters suggested that CMS should change its understanding of direct and indirect practice expense items. One commenter suggested that all variable costs proportional to the number of services furnished per day be considered direct. Another commenter suggested that the only costs that can be considered indirect costs are those that are required by all services, those that do not vary from one service type to the next; and those that are not based on service volume. Therefore CMS should allow all other recommended direct PE inputs to be allowed as direct PE inputs.

Response: We note that there is a longstanding PE methodology, established through notice and comment rulemaking that includes principles for determining whether an expense is direct or indirect. Under the established PE methodology, whether or not a particular cost is variable has little bearing on the appropriate classification of a particular item as a direct or indirect cost. Although we have previously pointed out that the current methodology does not accommodate costs that cannot be allocated to particular services as direct costs, this does not mean that all costs that can be allocated to particular services are necessarily direct costs. Instead, a significant number of costs considered to be indirect for purposes of the PE methodology are variable costs proportional to the kind and number of services furnished each day. For example, administrative and clerical resource costs associated with medical billing are likely to be incurred with each service furnished. Presumably, practitioners incur greater resource cost associated with administrative and clerical labor and supplies based on the volume of services furnished. Similarly, some kinds of services may require more administrative resources than others. Some complex services, for example, may require advance or follow-up administrative work that is not required for less complex services. General office expenses may also vary depending on the number and kind of services furnished. For example, practices that furnish a greater number of services to a greater number of patients generally require larger waiting rooms and additional waiting room furniture. Other services such as those that are furnished without having the patient present may not require patient waiting rooms at all. We note that some services require a different amount of electricity than others and some require more space than others. We believe that the PE methodology accounts for these costs in the allocation of indirect PE RVUs included in the payment rate for each service furnished to Medicare beneficiaries. We do not believe it would appropriate in the current methodology to include all such variable costs as direct PE inputs. Therefore, we do not agree with commenters' assertions regarding the appropriateness of these items as direct costs. Instead, we continue to believe that these costs represent indirect costs that are incorporated in the PE RVUs for these services through the allocation of indirect PE RVUs. We also direct readers to section II.E.2.b. of this final rule for a discussion of comments received regarding the CY 2013 interim final direct PE inputs for surgical pathology services.

After consideration of these comments, we are finalizing our proposal to remove the specified anomalous supply items from the direct PE input database. The CY 2014 direct PE input database and the PE RVUs displayed in Addendum B of this final rule with comment period reflect the finalization of this proposal.

b. Direct PE Input Refinements Based on Routine Data Review

In reviewing the direct PE input database, we identified several discrepancies that we proposed to address for CY 2014. In the following paragraphs, we identify the nature of these discrepancies, the affected codes, and the adjustments proposed in the CY 2014 proposed rule direct PE input database. As part of our internal review of information in the direct PE input database, we identified supply items that appeared without quantities for CPT code 51710 (Change of cystostomy tube; complicated). Upon reviewing these items we believed that the code should include the items at the quantities listed in Table 7.

Table 7—Supply Items and Quantities for CPT Code 51710 Back to Top
Supply code Description of supply item NF quantity
SA069 tray, suturing 1.0
SB007 drape, sterile barrier 16in x 29in 1.0
SC029 needle, 18-27g 1.0
SC051 syringe 10-12ml 1.0
SD024 catheter, Foley 1.0
SD088 Guidewire 1.0
SF036 suture, nylon, 3-0 to 6-0, c 1.0
SG055 gauze, sterile 4in x 4in 1.0
SG079 tape, surgical paper 1in (Micropore) 6.0
SH075 water, sterile inj 3.0
SJ032 lubricating jelly (K-Y) (5gm uou) 1.0
SJ041 povidone soln (Betadine) 20.0

Upon reviewing the direct PE inputs for CPT code 51710 and the related code 51705 (Change of cystostomy tube; simple), we also noted that the direct PE input database includes an anomalous 0.5 minutes of clinical labor time in the post-service period. We believe that this small portion of clinical labor time is the result of a rounding error in our data and should be removed from the direct PE input database.

Comment: One commenter supported the inclusion of the supply items for CPT code 51710. We received no comments regarding the change in clinical labor time for codes 51710 and 51705.

Response: Based on these comments and for the reasons stated, we are finalizing the removal of these items in the CY 2014 final direct PE input database.

During our review of the data, we noted an invalid supply code (SM037) that appears in the direct PE input database for CPT codes 88312 and 88313. Upon review of the code, we believe that the supply item called “wipes, lens cleaning (per wipe) (Kimwipe)” (SM027) should be included for these codes instead of the invalid supply code. We did not receive any comments regarding this proposed revision. Therefore, we are finalizing this revision as proposed for CY 2014.

Additionally, we conducted a routine review of the codes valued in the nonfacility setting for which moderate sedation is inherent in the procedure. Consistent with the standard moderate sedation package finalized in the CY 2012 PFS final rule with comment period (76 FR 73043), we have made minor adjustments to the nurse time and equipment time for 18 of these codes. These codes appear in Table 8.

Comment: One commenter agreed with this proposal to standardize moderate sedation inputs for codes valued in the nonfacility setting. We received no comments on the correction on the invalid supply item.

Response: After considering this comment, we are finalizing the minor adjustments to the moderate sedation inputs as proposed. The CY 2014 direct PE database reflects these adjustments.

Table 8—Codes With Minor Adjustments to Moderate Sedation Inputs Back to Top
CPT Code Descriptor
31629 Bronchoscopy/needle bx each.
31645 Bronchoscopy clear airways.
31646 Bronchoscopy reclear airway.
32405 Percut bx lung/mediastinum.
32550 Insert pleural cath.
35471 Repair arterial blockage.
37183 Remove hepatic shunt (tips).
37210 Embolization uterine fibroid.
43453 Dilate esophagus.
43458 Dilate esophagus.
44394 Colonoscopy w/snare.
45340 Sig w/balloon dilation.
47000 Needle biopsy of liver.
47525 Change bile duct catheter.
49411 Ins mark abd/pel for rt perq.
50385 Change stent via transureth.
50386 Remove stent via transureth.
57155 Insert uteri tandem/ovoids.
93312 Echo transesophageal.
93314 Echo transesophageal.
G0341 Percutaneous islet celltrans.

c. Adjustments to Pre-Service Clinical Labor Minutes

As we noted in the CY 2014 PFS proposed rule, we had recently received a recommendation from the AMA RUC regarding appropriate pre-service clinical labor minutes in the facility setting for codes with 000-day global periods. In general, the AMA RUC recommended that codes with 000-day global period include a maximum of 30 minutes of clinical labor time in the pre-service period in the facility setting. The AMA RUC identified 48 codes that currently include more clinical labor time than this recommended maximum and provided us with recommended pre-service clinical labor minutes in the facility setting of 30 minutes or fewer for these 48 codes. We reviewed the AMA RUC's recommendation and agree that the recommended reductions would be appropriate to maintain relativity with other 000-day global codes. Therefore, we proposed to amend the pre-service clinical labor minutes for the codes listed in Table 9, consistent with the AMA RUC recommendation.

Comment: One commenter supported this proposal based on the AMA RUC's recommendation.

Response: After considering the supporting comment, we are finalizing these changes as proposed. The CY 2014 direct PE input database reflects these changes.

Table 9—000-Day Global Codes With Changes to Pre-Service CL Time Back to Top
CPT code Short descriptor Existing CL Pre-Service facility minutes CL Pre-Service facility minutes (AMA RUC recommendation)
20900 Removal of bone for graft 60 30
20902 Removal of bone for graft 60 30
33224 Insert pacing lead & connect 35 30
33226 Reposition l ventric lead 35 30
36800 Insertion of cannula 60 0
36861 Cannula declotting 37 0
37202 Transcatheter therapy infuse 45 0
50953 Endoscopy of ureter 60 30
50955 Ureter endoscopy & biopsy 60 30
51726 Complex cystometrogram 41 30
51785 Anal/urinary muscle study 34 30
52250 Cystoscopy and radiotracer 37 30
52276 Cystoscopy and treatment 32 30
52277 Cystoscopy and treatment 37 30
52282 Cystoscopy implant stent 31 30
52290 Cystoscopy and treatment 31 30
52300 Cystoscopy and treatment 36 30
52301 Cystoscopy and treatment 36 30
52334 Create passage to kidney 31 30
52341 Cysto w/ureter stricture tx 42 30
52342 Cysto w/up stricture tx 42 30
52343 Cysto w/renal stricture tx 42 30
52344 Cysto/uretero stricture tx 55 30
52345 Cysto/uretero w/up stricture 55 30
52346 Cystouretero w/renal strict 55 30
52351 Cystouretero & or pyeloscope 45 30
52352 Cystouretero w/stone remove 50 30
52353 Cystouretero w/lithotripsy 50 30
52354 Cystouretero w/biopsy 50 30
52355 Cystouretero w/excise tumor 50 30
54100 Biopsy of penis 33 30
61000 Remove cranial cavity fluid 60 15
61001 Remove cranial cavity fluid 60 15
61020 Remove brain cavity fluid 60 15
61026 Injection into brain canal 60 15
61050 Remove brain canal fluid 60 15
61055 Injection into brain canal 60 15
61070 Brain canal shunt procedure 60 15
62268 Drain spinal cord cyst 36 30
67346 Biopsy eye muscle 42 30
68100 Biopsy of eyelid lining 32 30
93530 Rt heart cath congenital 35 30
93531 R & l heart cath congenital 35 30
93532 R & l heart cath congenital 35 30
93533 R & l heart cath congenital 35 30
93580 Transcath closure of asd 35 30
93581 Transcath closure of vsd 35 30

d. Price Adjustment for Laser Diode

As we noted in the CY 2013 PFS proposed rule, it has come to our attention that the price associated with the equipment item called “laser, diode, for patient positioning (Probe)” (ER040) in the direct PE input database is $7,678 instead of $18,160 as listed in the CY 2013 PFS final rule with comment period (77 FR 68922). We proposed to revise the direct PE input database to reflect the corrected price.

Comment: Several commenters expressed support for this proposal.

Response: We appreciate the commenters' support and have revised the CY 2014 final direct PE input database as proposed.

e. Direct PE Inputs for Stereotactic Radiosurgery (SRS) Services (CPT Codes 77372 and 77373)

Since 2001, Medicare has used HCPCS G-codes, in addition to the CPT codes, for stereotactic radiosurgery (SRS) to distinguish robotic and non-robotic methods of delivery. Based on our review of the current SRS technology, it is our understanding that most services currently furnished with linac-based SRS technology, including services currently billed using the non-robotic codes, incorporate some type of robotic feature. Therefore, we believe that it is no longer necessary to continue to distinguish robotic versus non-robotic linac-based SRS through the HCPCS G-codes. For purposes of the hospital outpatient prospective payment system (OPPS), we proposed to replace the existing four SRS HCPCS G-codes G0173 (Linear accelerator based stereotactic radiosurgery, complete course of therapy in one session), G0251(Linear accelerator based stereotactic radiosurgery, delivery including collimator changes and custom plugging, fractionated treatment, all lesions, per session, maximum five sessions per course of treatment), G0339 (Image-guided robotic linear accelerator-based stereotactic radiosurgery, complete course of therapy in one session or first session of fractionated treatment), and G0340 (Image-guided robotic linear accelerator-based stereotactic radiosurgery, delivery including collimator changes and custom plugging, fractionated treatment, all lesions, per session, second through fifth sessions, maximum five sessions per course of treatment), with the SRS CPT codes 77372 (Radiation treatment delivery, stereotactic radiosurgery (SRS), complete course of treatment of cranial lesion(s) consisting of 1 session; linear accelerator based) and 77373 (Stereotactic body radiation therapy, treatment delivery, per fraction to 1 or more lesions, including image guidance, entire course not to exceed 5 fractions) that do not distinguish between robotic and non-robotic methods of delivery. We refer readers to section II.C.3 of the CY 2014 OPPS proposed rule for more discussion of that proposal. We also refer readers to the CY 2007 OPPS final rule (71 FR 68023 through 68026) for a detailed discussion of the history of the SRS codes.

Two of the four current SRS G-codes are paid in the nonfacility setting through the PFS. These two codes, G0339 and G0340, describe robotic SRS treatment delivery and are contractor-priced. CPT codes 77372 and 77373, which describe SRS treatment delivery without regard to the method of delivery, are currently paid in the nonfacility setting based on resource-based RVUs developed through the standard PE methodology. We noted in the proposed rule that if the CY 2014 OPPS proposal were finalized, it would appear that there would no longer be a need for G-codes to describe robotic SRS treatment and delivery. We did not propose to replace the contractor-priced G-codes for PFS payment but did seek comment from the public and stakeholders, including the AMA RUC, regarding whether or not the direct PE inputs for CPT codes 77372 and 77373 would continue to accurately estimate the resources used in furnishing typical SRS delivery were there no coding distinction between robotic and non-robotic methods of delivery.

Comment: Several commenters, including the AMA RUC, responded to our request for information regarding whether the direct PE inputs for CPT codes 77372 and 77373 would continue to accurately estimate the resources used in furnishing typical SRS delivery were there no coding distinction between robotic and non-robotic methods of delivery. Most commenters, including the AMA RUC, stated that the most recently recommended direct PE inputs for these services would accurately estimate the resources. One commenter suggested this was not the case and that CMS should maintain the G-codes for purposes of PFS payment.

Response: We appreciate stakeholders' responsiveness to our request for information. We will consider the information submitted in public comments as we consider future rulemaking for these codes.

2. Using OPPS and ASC Rates in Developing PE RVUs

We typically establish two separate PE RVUs for services that can be furnished in either a nonfacility setting, like a physician's office, or a facility setting, like a hospital. The nonfacility PE RVUs reflect all of the direct and indirect practice expenses involved in furnishing a particular service when the entire service is furnished in a nonfacility setting. The facility PE RVUs reflect the direct and indirect practice expenses associated with furnishing a particular service in a setting such as a hospital or ASC where those facilities incur a portion or all of the costs and receive a separate Medicare payment for the service.

When services are furnished in the facility setting, such as a HOPD or an ASC, the total combined Medicare payment (made to the facility and the professional) typically exceeds the Medicare payment made for the same service when furnished in the physician office or other nonfacility setting. We believe that this payment difference generally reflects the greater costs that facilities incur than those incurred by practitioners furnishing services in offices and other nonfacility settings. For example, hospitals incur higher overhead costs because they maintain the capability to furnish services 24 hours a day and 7 days per week, generally furnish services to higher acuity patients than those who receive services in physicians' offices, and have additional legal obligations such as complying with the Emergency Medical Treatment and Labor Act (EMTALA). Additionally, hospitals must meet conditions of participation and ASCs must meet conditions for coverage in order to participate in Medicare.

However, we have found that for some services, the total Medicare payment when the service is furnished in the physician office setting exceeds the total Medicare payment when the service is furnished in an HOPD or an ASC. When this occurs, we believe it is not the result of appropriate payment differentials between the services furnished in different settings. Rather, we believe it is due to anomalies in the data we use under the PFS and in the application of our resource-based PE methodology to the particular services.

The PFS PE RVUs rely heavily on the voluntary submission of information by individuals furnishing the service and who are paid at least in part based on the data provided. Currently, we have little means to validate whether the information is accurate or reflects typical resource costs. Furthermore, in the case of certain direct costs, like the price of high-cost disposable supplies and expensive capital equipment, even voluntary information has been very difficult to obtain. In some cases the PE RVUs are based upon single price quotes or one paid invoice. We have addressed these issues extensively in previous rulemaking (for example, 75 FR 73252). Such incomplete, small sample, potentially biased or inaccurate resource input costs may distort the resources used to develop nonfacility PE RVUs used in calculating PFS payment rates for individual services.

In addition to the accuracy issues with some of the physician PE resource inputs, the data used in the PFS PE methodology can often be outdated. As we have previously noted (77 FR 68921) there is no practical means for CMS or stakeholders to engage in a complete simultaneous review of the input resource costs for all HCPCS codes paid under the PFS on an annual or even regular basis. Thus, the information used to estimate PE resource costs for PFS services is not routinely updated. Instead, we strive to maintain relativity by reviewing at the same time the work RVUs, physician time, and direct PE inputs for a code, and reviewing all codes within families of codes where appropriate. Nonetheless, outdated resource input costs may distort RVUs used to develop nonfacility PFS payment rates for individual services. In the case of new medical devices for which a high growth in the volume of a service as it diffuses into clinical practice may lead to a decrease in the cost of expensive items, outdated price inputs can result in significant overestimation of resource costs.

Such inaccurate resource input costs may distort the nonfacility PE RVUs used to calculate PFS payment rates for individual services. As we have previously noted, OPPS payment rates are based on auditable hospital data and are updated annually. Given the differences in the validity of the data used to calculate payments under the PFS and OPPS, we believe that the nonfacility PFS payment rates for procedures that exceed those for the same procedure when furnished in a facility result from inadequate or inaccurate direct PE inputs, especially in price or time assumptions, as compared to the more accurate OPPS data. On these bases, we proposed a change in the PE methodology beginning in CY 2014. To improve the accuracy of PFS nonfacility payment rates for each calendar year, we proposed to use the current year OPPS or ASC rates as a point of comparison in establishing PE RVUs for services under the PFS. In setting PFS rates, we proposed to compare the PFS payment rate for a service furnished in an office setting to the total combined Medicare payment to practitioners and facilities for the same service when furnished in a hospital outpatient setting. For services on the ASC list, we proposed to make the same comparison except we would use the ASC rate as the point of comparison instead of the OPPS rate.

We proposed to limit the nonfacility PE RVUs for individual codes so that the total nonfacility PFS payment amount would not exceed the total combined amount that Medicare would pay for the same code in the facility setting. That is, if the nonfacility PE RVUs for a code would result in a higher payment than the corresponding combined OPPS or ASC payment rate and PFS facility PE RVUs (when applicable) for the same code, we would reduce the nonfacility PE RVU rate so that the total nonfacility payment does not exceed the total Medicare payment made for the service in the facility setting. To maintain the greatest consistency and transparency possible, we proposed to use the current year PFS conversion factor. Similarly, we proposed to use current year OPPS or ASC rates in the comparison. For services with no work RVUs, we proposed to compare the total nonfacility PFS payment to the OPPS payment rates directly since no PFS payment is made for these services when furnished in the facility setting.

We proposed to exempt the following services from this policy:

  • Services Without Separate OPPS Payment Rates: We proposed to exclude services without separately payable OPPS rates from this methodical change since there would be no OPPS rate to which we could compare the PFS nonfacility PE RVUs. We note that there would also be no ASC rate for these services since ASCs are only approved to furnish a subset of OPPS services.
  • Codes Subject to the DRA Imaging Cap: We proposed to exclude from this policy services capped at the OPPS payment rate in accordance with the Deficit Reduction Act of 2005 (DRA) (Pub. L. 109-171). The DRA provision limits PFS payment for most imaging procedures to the amount paid under the OPPS system. This policy applies to the technical component of imaging services, including X-ray, ultrasound, nuclear medicine, MRI, CT, and fluoroscopy services. Screening and diagnostic mammograms are exempt. Since payment for these procedures is capped by statute we proposed to exclude them from this policy.
  • Codes with Low Volume in the OPPS or ASC: We proposed to exclude any service for which 5 percent or less of the total number of services are furnished in the OPPS setting relative to the total number of PFS/OPPS allowed services.
  • Codes with ASC Rates Based on PFS Payment Rates: To avoid issues of circularity, we proposed to exclude ASC services that are subject to the “office-based” procedure payment policies for which payment rates are based on the PFS nonfacility PE RVUs. We directed interested readers to the CY 2013 OPPS final rule (77 FR 68444) for additional information regarding this payment policy.
  • Codes Paid in the Facility at Nonfacility PFS Rates: To avoid issues of circularity, we also proposed to exclude services that are paid in the facility setting at nonfacility payment rates.

This would include certain professional-only services where the resource costs for practitioners are assumed to be similar in both settings.

  • Codes with PE RVUs Developed Outside the PE Methodology: We also proposed to exclude services with PE RVUs established through notice and comment rulemaking outside the PE Methodology.

Addendum B of the proposed rule displayed the PE RVUs that would result from implementation of the proposed change in the PE methodology.

In discussing resource input issues, some stakeholders have previously suggested that the direct costs (for example, clinical labor, disposable supplies and medical equipment) involved in furnishing a service are similar in both the nonfacility and facility settings. Others have suggested that facilities, like hospitals, have greater purchasing power for medical equipment and disposable supplies so that the direct costs for a facility to furnish a service can be lower than costs for a physician practice furnishing the same service. Our proposed policy did not assume that the direct costs to furnish a service in the nonfacility setting are always lower than in the facility setting. Medicare payment methodologies, including both OPPS and the PFS PE methodology, incorporate both direct and indirect costs (administrative labor, office expenses, and all other expenses). Our proposed policy was premised on the idea that there are significantly greater indirect resource costs that are carried by facilities even in the event that the direct costs involved in furnishing a service in the office and facility settings are comparable.

We stated our belief that our proposal provides a reliable means for Medicare to set upper payment limits for office-based procedures based on relatively more reliable cost information available for the same procedures when furnished in a facility setting where the cost structure would be expected to be somewhat, if not significantly, higher than the office setting. We believe that the current basis for estimating the resource costs involved in furnishing a PFS service is significantly encumbered by our current inability to obtain accurate information regarding supply and equipment prices, as well as procedure time assumptions. We believe that our proposed policy would mitigate the negative impact of these difficulties on both the appropriate relativity of PFS services and overall Medicare spending. A wide range of stakeholders and public commenters have pointed to the nonfacility setting as the most cost-effective location for services. Given the significantly higher cost structure of facilities (as discussed above) we believe that this presumption is accurate. In its March 2012 report to Congress, MedPAC recommended that Medicare should seek to pay similar amounts for similar services across payment settings, taking into account differences in the definitions of services and patient severity. (MedPAC March 2012 Report to Congress, page 46) We believe that the proposed change to our PFS PE methodology would more appropriately reflect resource costs in the nonfacility setting.

Comment: One commenter representing primary care physicians supported the proposal and indicated a belief that the proposed policy would help to correct misvaluation between primary care services and the services affected by the policy. Another commenter supported the policy as an interim step until an expedited review of the services could be conducted. Other commenters, while not supporting the proposal due to the financial impact on certain services, stated that hospitals and ASCs do typically incur higher overhead costs in delivering services than physician offices.

The overwhelmingly majority of commenters objected to the proposed policy. Several commenters believed the services impacted by the policy were potentially misvalued, but still opposed our policy. Many commenters questioned whether facilities' costs for providing all services are necessarily higher than the costs of physicians or other practitioners. Commenters stated that the resources required to furnish services in nonfacility physician settings cannot be accurately measured using the OPPS methodology and that our proposal would result in rank order anomalies. Commenters indicated that it was inappropriate to base PFS payment on OPPS payment since a single APC contains multiple services that can involve a wide a range of costs that are averaged under the OPPS methodology. Many commenters also stated that since OPPS payment rates rely on the accuracy of APC payments, developed through hospitals accurately allocating their costs and charges to particular departments/APCs. These commenters stated that hospitals may have little incentive to accurately allocate their costs and charges to particular departments/APCs since they typically provide a broad range of services and therefore have the ability to make up for losses on one service with profits on another. The argument is that this ability makes the precise pricing of individual services less important in the OPPS system than it is in the physician setting. Also, the argument is that if physicians are going to be paid based upon the OPPS system it should be for all services so that like the hospitals they benefit from those overpaid in the hospital. Many commenters also questioned CMS' authority to use payment rates from other Medicare payment methodologies to cap PFS rates since they asserted the policy violated the statutory requirement that the PFS PE relative values be based on the resources used in furnishing the service. Some commenters also cited the financial impact of our proposed policy on the PFS rates as a further reason that the policy was inappropriate.

For all of these reasons, these commenters recommended that we not adopt the proposed policy. Many of these commenters also suggested modifications to the policy if CMS did decide to move forward. Commenters suggested that since the ASC rates reflect the OPPS relative weights to determine payment rates under the ASC payment system, and are not based on cost information collected from ASCs, the ASC rates should not be used in the proposed policy.

Commenters also stated a strong preference to use prospective year OPPS rates instead of current year OPPS rates as the point of comparison to prospective year PFS rates. The CY 2014 OPPS proposed rule proposed significant packaging that raised payment for many APCs, and therefore, raised the associated PFS cap rate.

Some commenters stated that they believed that CMS does not have authority to use any conversion factor in the policy other than the one calculated under existing law for CY 2014.

Commenters stated that the low-volume threshold (a minimum of 5 percent in the hospital outpatient setting) was proposed with insufficient rationale and recommended either a 50 percent threshold or an absolute volume threshold. Commenters also argued that there should be an ASC low-volume threshold for using ASC rates.

Commenters urged CMS to establish a means for stakeholders to demonstrate the validity of office costs relative to OPPS payments prior to implementing a cap for any particular code. Commenters also suggested that the AMA RUC should examine each code prior to the implementation of the policy for that code.

Commenters suggested excluding codes recently revalued, such as certain surgical pathology codes, from the cap as their resource inputs and costs are more accurate than those less recently revalued.

Commenters suggested that CMS should make the cap more transparent by identifying all affected codes and displaying the data used in establishing the capped values.

Several commenters suggested using the individual OPPS HCPCS code costs that are used to calculate the APC payment, rather than the APC payment rate itself, as a way of avoiding the problems caused by the averaging that goes on in calculating the APC rates. These commenters argued that individual code costs are a more appropriate comparison than APC payment rates.

Response: As we stated in the proposed rule, when services are furnished in the facility setting, such as an HOPD or ASC, the total Medicare payment (made to the facility and the professional combined) typically exceeds the Medicare payment made for the same service when furnished in the physician office or other nonfacility setting. We continue to believe that this payment difference generally reflects the greater costs that facilities incur compared to those incurred by practitioners furnishing services in offices and other non-facility settings. We also continue to believe that if the total Medicare payment when a service is furnished in the physician office setting exceeds the total Medicare payment when a service is furnished in an HOPD or an ASC, this is generally not the result of appropriate payment differentials between the services furnished in different settings. Rather, we continue to believe that it is primarily due to anomalies in the data we use under the PFS and in the application of our resource-based PE methodology to the particular services.

We greatly appreciate all of the comments that we received on our proposal. Given the many thoughtful and detailed technical comments that we received, we are not finalizing our proposed policy in this final rule with comment period. We will consider more fully all the comments received, including those suggesting technical improvements to our proposed methodology. After further consideration of the comments, we expect to develop a revised proposal for using OPPS and ASC rates in developing PE RVUs which we will propose through future notice and comment rulemaking.

At this time, we do not believe that our standard process for evaluating potentially misvalued codes, including the use of the AMA RUC is an effective means of addressing these codes. As we stated in the proposed rule, we do not believe that the direct practice expense information we currently use to value these codes is accurate or reflects typical resource costs. We have addressed these issues extensively in previous rulemaking (for example, 75 FR 73252) and again in section II.B.4. of this final rule with comment period. We believe the current review process for direct PE inputs only accommodates incomplete, small sample, and potentially biased or inaccurate resource input costs that may distort the resources used to develop nonfacility PE RVUs used in calculating PFS payment rates for individual services.

3. Ultrasound Equipment Recommendations

In the CY 2012 PFS proposed rule (76 FR 42796), we asked the AMA RUC to review the ultrasound equipment described in the direct PE input database. We specifically asked for review of the ultrasound equipment items described in the direct PE input database and whether the ultrasound equipment listed for specific procedure codes is clinically necessary.

In response, the AMA RUC recommended creating several new equipment inputs in addition to the revision of current equipment inputs for ultrasound services. The AMA RUC also forwarded pricing information for new and existing equipment items from certain medical specialty societies that represent the practitioners who furnish these services. In the following paragraphs, we summarize the AMA RUC recommendations, address our review of the provided information, and describe a series of changes we proposed to the direct PE inputs used in developing PE RVUs for these services for CY 2014.

(1) Equipment Rooms

The AMA RUC made a series of recommendations regarding the ultrasound equipment items included in direct PE input equipment packages called “rooms.” Specifically, the AMA RUC recommended adding several new equipment items to the equipment packages called “room, ultrasound, general” (EL015) and “room, ultrasound, vascular” (EL016). The AMA RUC also recommended creating a similar direct PE input equipment package called “room, ultrasound, cardiovascular.” In considering these recommendations, we identified a series of new concerns regarding the makeup of these equipment packages and because there are several different ways to handle these concerns. In the CY 2014 PFS proposed rule we sought public comment from stakeholders prior to proposing to implement any of these recommended changes through future rulemaking.

We noted that the existing “rooms” for ultrasound technology include a greater number of individual items than the “rooms” for other kinds of procedures. For example, the equipment package for the “room, basic radiology” (EL012) contains only two items: an x-ray machine and a camera. Ordinarily under the PFS, direct PE input packages for “rooms” include only equipment items that are typically used in furnishing every service in that room. When equipment items beyond those included in a “room” are typically used in furnishing a particular procedure, the additional equipment items for that procedure are separately reflected in the direct PE input database in addition to the “room” rather than being included in the room. When handled in this way, the room includes only those inputs that are common to all services furnished in that room type, and thus the direct PE inputs are appropriate for the typical case of each particular service. When additional equipment items are involved in furnishing a particular service, they are included as an individual PE input only for that particular service.

In contrast, the equipment items currently included in the “room, ultrasound, general” are: the ultrasound system, five different transducers, two probe starter kits, two printers, a table, and various other items. In the proposed rule, we stated that we do not believe that it is likely that all of these items would be typically used in furnishing each service. For example, we do not believe that the typical ultrasound study would require the use of five different ultrasound transducers. However, the costs of all of these items are incorporated into the resource inputs for every service for which the ultrasound room is a direct PE input, regardless of whether each of those items is typically used in furnishing the particular service. This increases the resource cost for every service that uses the room regardless of whether or not each of the individual items is typically used in furnishing a particular procedure.

Instead of proposing to incorporate the AMA RUC's recommendation to add more equipment items to these ultrasound equipment “room” packages, we stated our intention to continue to consider the appropriateness of the full number of items in the ultrasound “rooms” in the context of maintaining appropriate relativity with other services across the PFS. We sought comment from stakeholders, including the AMA RUC, on the items included in the ultrasound rooms, especially as compared to the items included in other equipment “rooms.” We stated that we thought that it would be appropriate to consider these comments in future rulemaking instead of proposing to alter the existing “rooms” just for ultrasound equipment items for CY 2014. Specifically we sought comment on whether equipment packages called “rooms” should include all of the items that might be included in an actual room, just the items typically used for every service in such a room, or all of the items typically used in typical services furnished in the room. We stated that we believed that it would be most appropriate to propose changes to the “room, ultrasound, general” (EL015) and “room, ultrasound, vascular” (EL016) in the context of considering comments on this broader issue. We also stated that we believed that consideration of the broader issue will help determine whether it would be appropriate to create a “room, ultrasound, cardiovascular,” and if so, what items would be included in this equipment package.

Comment: Several commenters, including the AMA RUC, suggested that equipment room packages should include all items that are typically in the room and cannot be used for another patient, in order to furnish all typical services performed in that room. In its comment letter, the AMA RUC urged CMS to adopt its previous recommendations and pointed out that CMS has previously stated that equipment time is comprised of any time that clinical labor is using the piece of equipment, plus any additional time the piece of equipment is not available for use with another patient due to its use during the procedure in question. Therefore, any time a piece of equipment is not available for use with another patient, the equipment should be allocated minutes. The AMA RUC also pointed out, as an example, that the equipment item called “otoscope-ophthalmoscope (wall unit)” (EQ189) is a standard equipment input for all E/M codes even though it may not be typically used for each E/M service. Therefore, items included in the room but not necessarily typically used in furnishing particular services should be included as equipment minutes for all codes that typically use the room.

Response: We appreciate the responses of the AMA RUC and others regarding our questions regarding equipment packages. We remain concerned about the appropriate estimate of resources regarding equipment items, especially those in room packages. We note that in our previous statements regarding allocation of equipment minutes, we have articulated that equipment minutes should be allocated to particular items when those items are unavailable for use with another patient “due to its use during the procedure in question.” Based on the recommended equipment room packages, we are concerned that this definition may not apply consistently in the direct PE input database. While we understand the example of the “otoscope-ophthalmoscope (wall unit)” (EQ189) for E/M services, we believe that there may be other medical equipment items in a typical evaluation room in addition to the otoscope-ophthalmoscope (wall unit) and an exam table.

These comments reinforce our belief that, for the sake of relativity and accuracy, changes to particular equipment room packages should be made in the context of a broader examination of all equipment packages, as well as assumed equipment utilization rates for these packages.

In addition to the concerns regarding the contents of the ultrasound “room” packages, we also expressed concerned about the pricing information submitted through the AMA RUC to support its recommendation to add equipment to the ultrasound room packages. The highest-price item used in pricing the existing equipment input called “room, ultrasound, general” (EL015), is a “GE Logic 9 ultrasound system,” currently priced at $220,000. As part of the AMA RUC recommendation described in the proposal, a medical specialty society recommended increasing the price of that item to $314,500. However, that recommendation did not include documentation to support the pricing level, such as a copy of a paid invoice for the equipment. Furthermore, the recommended price conflicts with certain publicly available information. For example, the Milwaukee Sentinel-Journal reported in a February 9, 2013 article that the price for GE ultrasound equipment ranges from “$7,900 for a hand-held ultrasound to $200,000 for its most advanced model.” The same article points to an item called the “Logiq E9” as the ultrasound machine most used by radiologists and priced from $150,000 to $200,000. http://www.jsonline.com/business/ge-sees-strong-future-with-its-ultrasound-business-uj8mn79-190533061.html.

In the proposed rule, we noted that we were unsure how to best reconcile the information disclosed by the manufacturer to the press and the prices submitted by the medical specialty society for use in updating the direct PE input prices. We believe discrepancies, such as these, exemplify the potential problem with updating prices for particular items based solely on price quotes or information other than copies of paid invoices. However, copies of paid invoices must also be evaluated carefully. The information presented in the article regarding the price for hand-held ultrasound devices raises questions about the adequacy of paid invoices, too, in determining appropriate input costs. The direct PE input described in the database as “ultrasound unit, portable” (EQ250) is currently priced at $29,999 based on a submitted invoice, while the article cites that GE sells a portable unit for as low as $7,900. We sought comment on the appropriate price to use as the typical for portable ultrasound units.

Comment: We received several comments regarding the appropriate means to price the direct PE inputs. The AMA RUC and several specialty expressed concern that it is difficult for medical specialty societies to obtain paid invoices for equipment and supplies, especially for large equipment items that are bought infrequently.

Several medical specialty societies suggested that their members are often uncomfortable sending invoices for expensive items since the prices are often proprietary and even though identifying information is redacted, the invoices are sometimes distributed to all AMA RUC meeting participants and available to the public once submitted to CMS. The specialty society suggested that certain stakeholders in the marketplace are often able to identify the individual practice submitting the invoice through this process and that such public revelation of the propriety pricing information may have major implications for the provider in future price negotiations and service lines in local markets for any practitioner volunteering such information.

The AMA RUC expressed a shared concern with CMS about pricing information submitted as supporting documentation for the ultrasound room packages and stated that it will work with medical specialty societies to provide paid invoices as soon as possible. The AMA RUC also noted that it will work with the specialties to ensure that paid invoices, rather than quotes, are submitted to CMS. Several commenters objected to CMS' suggestion that a newspaper article might more accurately reflect typical resource costs than an invoice.

Response: We appreciate the response of the AMA RUC to these concerns. We also appreciate that in many cases the staff of medical specialty societies may have difficulty obtaining paid invoices. However, we believe the difficulty in obtaining invoices due to market sensitivity does not negate or lessen the critical importance of using accurate pricing information in establishing direct PE inputs. We believe it is likely that the pricing information would be less market sensitive if the information served to confirm the assumptions we already display in the direct PE input database. We appreciate the concerns shared by the AMA RUC's and we continue to seek the best means to identify typical resource costs associated with disposable supplies and medical equipment. While we believe that a copy of a paid invoice is the minimal amount of necessary information for pricing a disposable supply or medical equipment input, we reiterate our concerns that, even when proffered, a sole paid invoice is not necessarily the optimal source for identifying typical resource costs. We agree with commenters that information a manufacturer provides the news media is not necessarily accurate. However, when such information stands in stark contrast to single invoices, we believe it is imperative to attempt to reconcile that information to identify the best available information regarding the typical cost. We will continue to consider the perspectives offered by these commenters in developing future proposals regarding the pricing of individual items and equipment packages.

(2) New Equipment Inputs and Price Updates

Ultrasound Unit, portable, breast procedures. The AMA RUC recommended that a new direct PE input, “ultrasound unit, portable, breast procedures,” be created for breast procedures that are performed in a surgeon's office and where ultrasound imaging is included in the code descriptor. These services are described by CPT codes 19105 (Ablation, cryosurgical, of fibroadenoma, including ultrasound guidance, each fibroadenoma), 19296 (Placement of radiotherapy afterloading expandable catheter (single or multichannel) into the breast for interstitial radioelement application following partial mastectomy, includes imaging guidance; on date separate from partial mastectomy), and 19298 (Placement of radiotherapy afterloading brachytherapy catheters (multiple tube and button type) into the breast for interstitial radioelement application following (at the time of or subsequent to) partial mastectomy, includes imaging guidance). As we noted in the proposed rule, we are creating this input. The pricing information submitted for this item is a paid invoice and two price quotes. As we have previously stated, we believe that copies of paid invoices are more likely to reflect actual resource costs associated with equipment and supply items than quotes or other information. Therefore, we proposed a price of $33,930, which reflects the price displayed on the submitted copy of the paid invoice. We are not using the quotes as we do not believe that quotes provide reliable information about the prices that are actually paid for medical equipment. We did not receive any additional information regarding the price for this equipment item. Therefore the CY 2014 direct PE input database reflects the price as proposed.

Endoscopic Ultrasound Processor. The AMA RUC recommended creating a new direct PE input called “endoscopic ultrasound processor,” for use in furnishing the service described by CPT code 31620 (Endobronchial ultrasound (EBUS) during bronchoscopic diagnostic or therapeutic intervention(s) (List separately in addition to code for primary procedure[s])). We created this equipment item to use as an input in the direct PE input database. The price associated with the “endoscopic ultrasound processor” is $59,925, which reflects the price documented on the copy of the paid invoice submitted with the recommendation. We did not receive any additional information regarding the price for this equipment item. Therefore the CY 2014 direct PE input database reflects the price as proposed.

Bronchofibervideoscope. The AMA RUC recommended creating a new direct PE input called “Bronchofibervideoscope,” for use in furnishing the service described by CPT code 31620 (Endobronchial ultrasound (EBUS) during bronchoscopic diagnostic or therapeutic intervention(s) (List separately in addition to code for primary procedure[s])). We created this new equipment item to use as an input in the direct PE input database. However, this item had no price associated with it in the proposed direct PE input database because we did not receive any information that would allow us to price the item accurately. Consequently, we sought copies of paid invoices for this equipment item in the CY 2014 proposed rule so that we could price the item accurately in the future.

Comment: One commenter reported that the current sales price for the bronchofibervideoscope ranges from $30,000-$50,000. The commenter provided an invoice for the equipment that reflected a price of $35,200.

Response: Based on the submission of the invoice information, we have updated the direct PE input database to reflect a price of $35,200 for the Bronchofibervideoscope (ER093).

Endoscope, ultrasound probe, drive (ES015). The AMA RUC forwarded pricing information to us regarding the existing input called “endoscope, ultrasound probe, drive” (ES015), including a copy of a paid invoice. Based on this information, we proposed to change the price associated with ES015 to $13,256.25, which reflects the price documented on the submitted copy of the paid invoice. We did not receive any additional information regarding the price for this equipment item. Therefore, we the CY 2014 direct PE input database reflects the price as proposed.

(2) Ultrasound Equipment Input Recommendations for Particular Services

The AMA RUC made recommendations regarding the typical ultrasound items used in furnishing particular services. In general, the AMA RUC recommended that the existing equipment items accurately described the typical equipment used in furnishing particular services. However, for some CPT codes the AMA RUC recommended changing the associated equipment inputs that appear in the direct PE input database. Based on our review of these recommendations, we generally agreed with the AMA RUC regarding these recommended changes, and the recommended changes are reflected in the direct PE input database. Table 10 displays the codes with changes to ultrasound equipment. However, for certain codes we did not agree with the recommendations of the AMA RUC. The following paragraphs address the changes we proposed that differ from the recommendations of the AMA RUC.

For a series of cardiovascular services that include ultrasound technology, the AMA RUC recommended removing certain equipment items and replacing those items with a new item called “room, ultrasound, cardiovascular.” As we described in the preceding paragraphs, we did not propose to create the “room, ultrasound, cardiovascular” and therefore did not propose to add this “room” as an input for these services. However, we noted that the newly recommended equipment package incorporates many of the same kinds of items as the currently existing “room, ultrasound, vascular” (EL016). We agreed with the AMA RUC's suggestion that the existing equipment inputs for the relevant services listed in Table 10 do not reflect typical resource costs of furnishing the services. We believed that, pending our further consideration of the ultrasound “room” equipment packages, it would be appropriate to use the existing “room, ultrasound, vascular” (EL016) as a proxy for resource costs for these services.

Comment: Several commenters urged CMS to accept the AMA RUC's recommendations. Most of these commenters suggested that if CMS were not to accept the AMA RUC's recommendation to create the new “cardiovascular ultrasound room” for CY 2014, then the inputs for the existing “room, ultrasound, vascular” (EL016) should be used. A few commenters representing some of the practitioners who furnish some of these services objected to the change in equipment inputs based on their assertion that the members of their specialty societies typically use more resource intensive equipment than reflected in the AMA RUC recommendations. One of these commenters suggested that the CPT codes for fetal echocardiography (CPT codes 76825, 76826, 78627, and 78628) previously included the same equipment items as the other echocardiography codes with equipment updates. This commenter suggested that the equipment for these codes should be updated to correspond with the equipment for other, similar services.

Response: As we noted in the proposed rule, we believe that the issue of equipment room packages should be addressed in future rulemaking. Based on these comments, we are finalizing the use of the existing “room, ultrasound, vascular” (EL016) as a proxy for resource costs for these services pending future consideration of equipment room packages. We note that the AMA RUC based its recommendation on information obtained from the medical specialty societies that represent the specialty of the practitioners who furnish the majority of allowed services for each of these codes using recent Medicare claims data. We examined the comments we received objecting to the finalization of the AMA RUC-recommended equipment recommendations and, in each case, confirmed that the commenters did not represent the practitioners who typically furnish each service according to the Medicare claims data. In the case of the fetal echocardiography codes, we agree with the commenter's suggestion that the equipment for these codes should correspond with the equipment for the similar services, especially since the AMA RUC recommended replacing these items for all other codes in the direct PE inputs database. Based on that review, we remain confident that our proposal is appropriate and we are finalizing the changes in the ultrasound equipment items as proposed, with the exception of updating the equipment items for fetal echocardiography to be consistent with other echocardiography services. These changes are displayed in Table 10 and incorporated in the CY 2014 direct PE input database.

In the case of CPT code 76942 (Ultrasonic guidance for needle placement (for example, biopsy, aspiration, injection, localization device), imaging supervision and interpretation), we agreed with the AMA RUC's recommendation to replace the current equipment input of the “room, ultrasound, general” (EL015) with “ultrasound unit, portable” (EQ250). We note that this service is typically reported with other codes that describe the needle placement procedures and that the recommended change in equipment from a room to a portable device reflects a change in the typical kinds of procedures reported with this image guidance service. Given this change, we believe that it is appropriate to reconsider the procedure time assumption currently used in establishing the direct PE inputs for this code, which is 45 minutes. We reviewed the services reported with CPT code 76942 to identify the most common procedures furnished with this image guidance. The code most frequently reported with CPT code 76942 is CPT 20610 (Arthrocentesis, aspiration and/or injection; major joint or bursa (for example, shoulder, hip, knee joint, subacromial bursa). The assumed procedure time for this service is five minutes. The procedure time assumptions for the vast majority of other procedures frequently reported with CPT code 76942 range from 5 to 20 minutes. Therefore, in addition to proposing the recommended change in equipment inputs associated with the code, we proposed to change the procedure time assumption used in establishing direct PE inputs for the service from 45 to 10 minutes, based on our analysis of 30 needle placement procedures most frequently reported with CPT code 76942. We noted that this reduced the clinical labor and equipment minutes associated with the code from 58 to 23 minutes.

Comment: Several commenters noted that the AMA RUC is planning to conduct surveys and review the assumptions regarding the code and that CMS will be in a better position to make more accurate determinations if it waits for that data from the AMA RUC. One commenter stated that CMS should not make a change in the direct PE input database based on information in the Medicare claims data without input from the medical specialty societies whose members furnish and report the ultrasound guidance as described with CPT code 76942 and that a recommendation from the AMA RUC may provide better data than the information contained on Medicare claims.

Response: We appreciate the partnership of the AMA RUC in the misvalued code initiative, but as a general principle, we do not believe that we should refrain from making appropriate changes to code values solely because the AMA RUC is planning to review a service in the future. In some cases, we believe that we should examine claims information and other sources of data and make proposals regarding the appropriate inputs used to develop the amount Medicare pays for PFS services. We believe that notice and comment rulemaking itself provides a means for the public, including medical specialty societies and the AMA RUC, to respond substantively to proposed changes in resource inputs for particular services. Furthermore, in cases like this one, we do not believe that the information reflected in the Medicare claims data is subjective or open to differing interpretations.

Comment: Several commenters, including the AMA RUC, pointed out that CPT code 76942 includes supervision and interpretation, which represents both time and work that is separate from the surgical code and that the additional time included in the direct PE inputs may reflect time in addition to the base procedure.

Response: We appreciate the response of the AMA RUC and others in pointing out concerns with our assumptions. We note that the proposed clinical labor service period of 23 minutes includes the 10 minutes of intra-service time in addition to 2 minutes for preparing the room, equipment, and supplies, 3 minutes for preparing and positioning the patient, 3 minutes for cleaning the room, and 5 minutes for processing images, completing data sheet, and presenting images and data to the interpreting physician. We did not receive information from any commenters suggesting that the time allocated for these tasks was inadequate. Therefore, we are finalizing our adjustment to the clinical labor minutes associated with this code, as proposed.

Table 10—Codes With Changes to Ultrasound Equipment for CY 2014 Back to Top
CPT code Descriptor CY 2013 CMS equipment code CY 2013 equipment description CY 2014 equipment CMS code CY 2014 equipment description
19105 Cryosurg ablate fa each EQ250 ultrasound unit, portable NEW ultrasound unit, portable, breast procedures.
19296 Place po breast cath for rad EL015 room, ultrasound, general NEW ultrasound unit, portable, breast procedures.
19298 Place breast rad tube/caths EL015 room, ultrasound, general NEW ultrasound unit, portable, breast procedures.
31620 Endobronchial us add-on n/a NEW Bronchofibervideoscope.
n/a NEW Endoscopic ultrasound processor.
52649 Prostate laser enucleation EQ255 ultrasound, noninvasive bladder scanner w-cart EQ250 ultrasound unit, portable.
76376 3d render w/o postprocess EL015 room, ultrasound, general Remove input.
76775 Us exam abdo back wall lim EL015 room, ultrasound, general EQ250 ultrasound unit, portable.
76820 Umbilical artery echo EQ249 ultrasound color doppler, transducers and vaginal probe EL015 room, ultrasound, general.
76825 Echo exam of fetal heart EQ254 ultrasound, echocardiography w-4 transducers (Sequoia C256) EL016 room, ultrasound, vascular.
EQ252 ultrasound, echocardiography analyzer software (ProSolv)    
76826 Echo exam of fetal heart EQ254 ultrasound, echocardiography w-4 transducers (Sequoia C256) EL016 room, ultrasound, vascular.
EQ252 ultrasound, echocardiography analyzer software (ProSolv)    
76827 Echo exam of fetal heart EQ254 ultrasound, echocardiography w-4 transducers (Sequoia C256) EL016 room, ultrasound, vascular.
76828 Echo exam of fetal heart EQ254 ultrasound, echocardiography w-4 transducers (Sequoia C256) EL016 room, ultrasound, vascular.
76857 Us exam pelvic limited EL015 room, ultrasound, general EQ250 ultrasound unit, portable.
76870 Us exam scrotum EL015 room, ultrasound, general EQ250 ultrasound unit, portable.
76872 Us transrectal EL015 room, ultrasound, general EQ250 ultrasound unit, portable.
76942 Echo guide for biopsy EL015 room, ultrasound, general EQ250 ultrasound unit, portable.
93303 Echo guide for biopsy EQ253 ultrasound, echocardiography digital acquisition (Novo Microsonics, TomTec) EL016 room, ultrasound, vascular.
EQ254 ultrasound, echocardiography w-4 transducers (Sequoia C256)    
EQ252 ultrasound, echocardiography analyzer software (ProSolv)    
93304 Echo transthoracic EQ252 ultrasound, echocardiography analyzer software (ProSolv) EL016 room, ultrasound, vascular.
EQ253 ultrasound, echocardiography digital acquisition (Novo Microsonics, TomTec)    
EQ254 ultrasound, echocardiography w-4 transducers (Sequoia C256)    
93306 Tte w/doppler complete EQ253 ultrasound, echocardiography digital acquisition (Novo Microsonics, TomTec) EL016 room, ultrasound, vascular.
EQ254 ultrasound, echocardiography w-4 transducers (Sequoia C256)    
EQ252 ultrasound, echocardiography analyzer software (ProSolv)    
93307 Tte w/o doppler complete EQ252 ultrasound, echocardiography analyzer software (ProSolv) EL016 room, ultrasound, vascular.
EQ253 ultrasound, echocardiography digital acquisition (Novo Microsonics, TomTec)    
EQ254 ultrasound, echocardiography w-4 transducers (Sequoia C256)    
93308 Tte f-up or lmtd EQ252 ultrasound, echocardiography analyzer software (ProSolv) EL016 room, ultrasound, vascular.
EQ253 ultrasound, echocardiography digital acquisition (Novo Microsonics, TomTec)    
EQ254 ultrasound, echocardiography w-4 transducers (Sequoia C256)    
93312 Echo transesophageal EQ253 ultrasound, echocardiography digital acquisition (Novo Microsonics, TomTec) EL016 room, ultrasound, vascular.
EQ252 ultrasound, echocardiography analyzer software (ProSolv)    
EQ256 ultrasound, transducer (TEE Omniplane II)    
EQ254 ultrasound, echocardiography w-4 transducers (Sequoia C256)    
93314 Echo transesophageal EQ254 ultrasound, echocardiography w-4 transducers (Sequoia C256) EL016 room, ultrasound, vascular.
EQ256 ultrasound, transducer (TEE Omniplane II)    
EQ252 ultrasound, echocardiography analyzer software (ProSolv)    
EQ253 ultrasound, echocardiography digital acquisition (Novo Microsonics, TomTec)    
93320 Doppler echo exam heart EQ252 ultrasound, echocardiography analyzer software (ProSolv) EL016 room, ultrasound, vascular.
EQ253 ultrasound, echocardiography digital acquisition (Novo Microsonics, TomTec)    
EQ254 ultrasound, echocardiography w-4 transducers (Sequoia C256)    
93321 Doppler echo exam heart EQ252 ultrasound, echocardiography analyzer software (ProSolv) EL016 room, ultrasound, vascular.
EQ254 ultrasound, echocardiography w-4 transducers (Sequoia C256)    
93325 Doppler color flow add-on EQ252 ultrasound, echocardiography analyzer software (ProSolv) EL016 room, ultrasound, vascular.
EQ253 ultrasound, echocardiography digital acquisition (Novo Microsonics, TomTec)    
EQ254 ultrasound, echocardiography w-4 transducers (Sequoia C256)    
93350 Stress tte only EQ252 ultrasound, echocardiography analyzer software (ProSolv) EL016 room, ultrasound, vascular.
EQ253 ultrasound, echocardiography digital acquisition (Novo Microsonics, TomTec)    
EQ254 ultrasound, echocardiography w-4 transducers (Sequoia C256)    
93351 Stress tte complete EQ254 ultrasound, echocardiography w-4 transducers (Sequoia C256) EL016 room, ultrasound, vascular.
93980 Penile vascular study EL015 room, ultrasound, general EQ249 ultrasound color doppler, transducers and vaginal probe.
93981 Penile vascular study EL015 room, ultrasound, general EQ249 ultrasound color doppler, transducers and vaginal probe.

B. Misvalued Services

1. Valuing Services Under the PFS

Section 1848(c) of the Act requires the Secretary to determine relative values for physicians' services based on three components: work, PE, and malpractice. Section 1848(c)(1)(A) of the Act defines the work component to include “the portion of the resources used in furnishing the service that reflects physician time and intensity in furnishing the service.” In addition, section 1848(c)(2)(C)(i) of the Act specifies that “the Secretary shall determine a number of work relative value units (RVUs) for the service based on the relative resources incorporating physician time and intensity required in furnishing the service.” Section 1848(c)(1)(B) of the Act defines the PE component as “the portion of the resources used in furnishing the service that reflects the general categories of expenses (such as office rent and wages of personnel, but excluding malpractice expenses) comprising practice expenses.” (See section I.B.1.b. for more detail on the development of the PE component.) Section 1848(c)(1)(C) of the Act defines the malpractice component as “the portion of the resources used in furnishing the service that reflects malpractice expenses in furnishing the service.” Sections 1848 (c)(2)(C)(ii) and (iii) of the Act specify that PE and malpractice RVUs shall be determined based on the relative PE/malpractice resources involved in furnishing the service.

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 RVUs established under the PFS. Section 3134(a) of the Affordable Care Act added a new section 1848(c)(2)(K) to the Act, which 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 3134(a) of the Affordable Care Act also added a new section 1848(c)(2)(L) to the Act, which requires the Secretary to develop a process to validate the RVUs of certain potentially misvalued codes under the PFS, identified using the same criteria used to identify potentially misvalued codes, and to make appropriate adjustments.

As discussed in section II.B.1. of this final rule with comment period, each year we develop and propose appropriate adjustments to the RVUs, taking into account the recommendations provided by the American Medical Association/Specialty Society Relative Value Scale Update Committee (AMA RUC), the Medicare Payment Advisory Commission (MedPAC), and others. For many years, the AMA 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 the law. We may also consider analyses of physician 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) National Database, and the Physician Quality Reporting System (PQRS) databases. In addition to considering the most recently available data, we also assess the results of physician surveys and specialty recommendations submitted to us by the AMA RUC. We conduct a clinical 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 in addition to taking into account the results of consultations with organizations representing physicians. In accordance with section 1848(c) of the Act, we determine appropriate adjustments to the RVUs, explain the basis of these adjustments, and respond to public comments in the PFS proposed and final rules.

2. Identifying, Reviewing, and Validating the RVUs of Potentially Misvalued Services

a. Background

In its March 2006 Report to the Congress, MedPAC noted that “misvalued services can distort the price signals 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 PEs 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 PEs rise. In the ensuing years since MedPAC's 2006 report, additional groups of potentially misvalued services have been identified by the Congress, CMS, MedPAC, the AMA RUC, and other stakeholders.

In recent years, CMS and the AMA RUC have taken increasingly significant steps to identify and address potentially misvalued codes. As MedPAC noted in its March 2009 Report to Congress, in the intervening years since MedPAC made the initial recommendations, “CMS and the AMA RUC have taken several steps to improve the review process.” Most recently, section 1848(c)(2)(K)(ii) of the Act (as added by section 3134(a) of the Affordable Care Act) directed the Secretary to specifically examine, as determined appropriate, potentially misvalued services in the following seven categories:

  • Codes and families of codes for which there has been the fastest growth;
  • Codes and families of codes that have experienced substantial changes in PEs;
  • Codes that are recently established for new technologies or services;
  • 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 which have not been subject to review since the implementation of the RBRVS (the so-called `Harvard-valued codes'); and
  • Other codes determined to be 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. Finally, 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 physician fee schedule.

b. Progress in Identifying and Reviewing Potentially Misvalued Codes

To fulfill our statutory mandate, we have identified and reviewed numerous potentially misvalued codes in all seven of the categories specified in section 1848(c)(2)(K)(ii) of the Act, and we plan to continue our work examining potentially misvalued codes in these areas over the upcoming years. In the current process, we identify potentially misvalued codes for review, and request recommendations from the AMA RUC and other public commenters on revised work RVUs and direct PE inputs for those codes. The AMA 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, other individuals and stakeholder groups submit nominations for review of potentially misvalued codes as well.

Since CY 2009, as a part of the annual potentially misvalued code review and Five-Year Review process, we have reviewed more than 1,000 potentially misvalued codes to refine work RVUs and direct PE inputs. We have adopted 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 CY 2012 PFS proposed rule, we proposed to identify and review potentially misvalued codes in the category of “Other codes determined to be appropriate by the Secretary,” referring to a list of the highest PFS expenditure services, by specialty, that had not been recently reviewed (76 FR 73059 through 73068).

In the CY 2012 final rule with comment period, we finalized our policy to consolidate the review of physician work and PE at the same time (76 FR 73055 through 73958), and established a process for the annual public nomination of potentially misvalued services.

One of the priority categories for review of potentially misvalued codes is services that have not been subject to review since the implementation of the PFS (the so-called “Harvard-valued codes”). In the CY 2009 PFS proposed rule, we requested that the AMA RUC engage in an ongoing effort to review the remaining Harvard-valued codes, focusing first on the high-volume, low intensity codes (73 FR 38589). For the Fourth Five-Year Review (76 FR 32410), we requested that the AMA RUC review services that have not been reviewed since the original implementation of the PFS with annual utilization greater than 30,000 (Harvard-valued—Utilization > 30,000). In the CY 2013 final rule with comment period, we identified for review the potentially misvalued codes for Harvard-valued services with annual allowed charges that total at least $10,000,000 (Harvard-valued—Allowed charges ≥$10,000,000).

In addition to the Harvard-valued codes, in the same rule we finalized for review a list of potentially misvalued codes that have stand-alone PE (these are codes with clinical labor procedure time assumptions not connected or dependent on physician time assumptions; see 77 FR 68918 for detailed information).

c. Validating RVUs of Potentially Misvalued Codes

In addition to identifying and reviewing potentially misvalued codes, section 3134(a) of the Affordable Care Act added section 1848(c)(2)(L) of the Act, which specifies that the Secretary shall establish a formal process to validate RVUs under the PFS. The validation process may include validation of work elements (such as time, mental effort and professional judgment, technical skill and physical effort, and stress due to risk) involved with furnishing a service and may include validation of the pre-, post-, and intra-service components of work. The Secretary is directed, as part of the validation, to validate a sampling of the work RVUs of codes identified through any of the seven categories of potentially misvalued codes specified by section 1848(c)(2)(K)(ii) of the Act. Furthermore, the Secretary may conduct the validation using methods similar to those used to review potentially misvalued codes, including conducting surveys, other data collection activities, studies, or other analyses as the Secretary determines to be appropriate to facilitate the validation of RVUs of services.

In the CY 2011 PFS proposed rule (75 FR 40068) and CY 2012 PFS proposed rule (76 FR 42790), we solicited public comments on possible approaches, methodologies, and data sources that we should consider for a validation process. A summary of the comments along with our responses are included in the CY 2011 PFS final rule with comment period (75 FR 73217) and the CY 2012 PFS final rule with comment period (73054 through 73055).

As we indicated in the CY 2014 PFS proposed rule (78 FR 43304), we have entered into two contracts with outside entities to develop validation models for RVUs. During a 2-year project, the RAND Corporation will use available data to build a validation model to predict work RVUs and the individual components of work RVUs, time and intensity. The model design will be informed by the statistical methodologies and approach used to develop the initial work RVUs and to identify potentially misvalued procedures under current CMS and AMA RUC processes. RAND will use a representative set of CMS-provided codes to test the model. RAND will consult with a technical expert panel on model design issues and the test results.

The second contract is with the Urban Institute. Given the central role of time in establishing work RVUs and the concerns that have been raised about the current time values, a key focus of the project is collecting data from several practices for selected services. The data will be used to develop time estimates. Urban Institute will use a variety of approaches to develop objective time estimates, depending on the type of service, which will be a very resource-intensive part of the project. Objective time estimates will be compared to the current time values used in the fee schedule. The project team will then convene groups of physicians from a range of specialties to review the new time data and their potential implications for work and the ratio of work to time.

The research being performed under these two contracts continues. For additional information, please visit our Web site (http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PhysicianFeeSched/Downloads/RVUs-Validation-Model.pdf).

3. CY 2014 Identification and Review of Potentially Misvalued Services

a. Public Nomination of Potentially Misvalued Codes

The public and stakeholders may nominate potentially misvalued codes for review by submitting the code with supporting documentation during the 60-day public comment period following the release of the annual PFS final rule with comment period under a process we finalized in the CY 2012 PFS final rule with comment period (76 FR 73058). Supporting documentation for codes nominated for the annual review of potentially misvalued codes may include the following:

  • Documentation in the peer-reviewed medical literature or other reliable data that there have been 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 physician time.
  • An anomalous relationship between the code being proposed for review and other codes.
  • Evidence that technology has changed physician work, that is, diffusion of technology.
  • 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 physician time, work RVU, or direct PE inputs using other data sources (for example, Department of Veteran Affairs (VA) National Surgical Quality Improvement Program (NSQIP), the Society for Thoracic Surgeons (STS) National Database, and the Physician Quality Reporting System (PQRS) databases).
  • National surveys of physician time and intensity from professional and management societies and organizations, such as hospital associations.

After we receive the nominated codes during the 60-day comment period following the release of the annual PFS final rule with comment period, we evaluate the supporting documentation 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 whether we are proposing each nominated code as a potentially misvalued code. We encourage the public to submit nominations for potentially misvalued codes during the comment period for this CY 2014 PFS final rule with comment period.

We did not receive any public nominations of codes for consideration as potentially misvalued codes in response to the CY 2013 final rule with comment period. As a result, we did not propose any publicly nominated potentially misvalued codes in the CY 2014 proposed rule.

b. Potentially Misvalued Codes

i. Contractor Medical Director Identified Potentially Misvalued Codes

We began considering additional ways to broaden participation in the process of identifying potentially misvalued codes; we solicited the input of Medicare Administrative Contractor medical directors (CMDs) in making suggestions for codes to consider proposing as potentially misvalued codes.

In the proposed rule, we noted several reasons why we believed that CMD input would be valuable in developing our proposal. As a group, CMDs represent a variety of medical specialties, which makes them a diverse group of physicians capable of providing opinions across the vast scope of services covered under the PFS. They are on the front line of administering the Medicare program, with their offices often serving as the first point of contact for practitioners with questions regarding coverage, coding and claims processing. CMDs spend a significant amount of time communicating directly with practitioners and the health care industry discussing more than just the broad aspects of the Medicare program but also engaging in and facilitating specific discussions around individual services. Through their development of evidence-based local coverage determinations (LCDs), CMDs also have experience developing policy based on research.

Comment: Many commenters supported our seeking input from the CMDs in developing our proposal for codes to be considered as potentially misvalued codes, while others expressed concern about using input from CMDs. Some asked for details on the process that the CMDs used to identify codes and some questioned whether CMDs possess the specialty-related expertise to determine if a service is misvalued when that service is not generally performed by a CMD's designated specialty. In addition, several commenters believe that the identification of misvalued codes (in addition to review and revision of those codes) should be carried out through the AMA RUC process with input from the medical community. These commenters oppose any effort by CMS to unilaterally change code values.

Response: The commenters are correct in noting that CMDs do not represent all specialties. We would note that in their role as CMDs, they do work on issues involving all specialties. Moreover, their role in this process was simply to assist us in identifying codes that we could consider proposing as potentially misvalued codes. After our evaluation, we proposed them as potentially misvalued codes in the CY 2014 proposed rule and sought public comment. Thus the affected specialties and other stakeholders had the opportunity to provide us with public comments as to whether or not these codes should be evaluated as potentially misvalued. If, following our consideration of public comments, we determine that these codes are potentially misvalued, the AMA RUC and others will have further opportunity to submit information and public comment about the appropriate value of the codes before we would determine the codes are in fact misvalued and make changes to the values.

Given the importance of ensuring that codes are appropriately valued, we believe it is appropriate to call upon the experience of CMDs in developing our proposal. Accordingly, we will proceed as we proposed in the CY 2014 proposed rule to consider the codes identified by CMDs as potentially misvalued codes.

In consultation with our CMDs, the following lists of codes in Tables 11 and 12 were identified as potentially misvalued in the CY 2014 proposed rule.

Table 11—Codes Proposed as Potentially Misvalued Identified in Consultation With CMDs Back to Top
CPT code Short descriptor
17311 Mohs 1 stage h/n/hf/g.
17313 Mohs 1 stage t/a/l.
21800 Treatment of rib fracture.
22305 Closed tx spine process fx.
27193 Treat pelvic ring fracture.
33960 External circulation assist.
33961 External circulation assist, each subsequent day.
47560 Laparoscopy w/cholangio.
47562 Laparoscopic cholecystectomy.
47563 Laparo cholecystectomy/graph.
55845 Extensive prostate surgery.
55866 Laparo radical prostatectomy.
64566 Neuroeltrd stim post tibial.
76942 Echo guide for biopsy.

CPT codes 17311 (Mohs micrographic technique, including removal of all gross tumor, surgical excision of tissue specimens, mapping, color coding of specimens, microscopic examination of specimens by the surgeon, and histpathologic preparation including routine stain(s) (for example, hematoxylin and eosin, toluidine blue), head, neck, hands, feet genitalia, or any location with surgery directly involving muscle, cartilage, bone, tendon, major nerves, or vessels; first stage, up to 5 tissue blocks) and 17313 (Mohs micrographic technique, including removal of all gross tumor, surgical excision of tissue specimens, mapping, color coding of specimens, microscopic examination of specimens by the surgeon, and histopathologic preparation including routine stains(s) (for example, hematoxylin and eosin, toluidine blue), of the trunk, arms, or legs; first stage, up to 5 tissue blocks) were proposed as potentially misvalued codes because we believe that these codes may be overvalued based on CMD comments suggesting excessive utilization.

Comment: All commenting on CPT codes 17311 and 17313 stated that these codes were being reviewed by the AMA RUC in 2013, and two suggested that we accept the AMA RUC recommended work values (6.2 and 5.56 respectively) in the 2014 PFS final rule with comment period. One commenter asserted that these codes were not misvalued and should be removed from consideration as potentially misvalued but did not supply any information to support this view.

Response: The commenters are correct that the codes were under review by the AMA RUC. Since the publication of the proposed rule, we have received recommendations from the AMA RUC for these codes. Rather than finalizing them as potentially misvalued codes, since we have the AMA RUC recommendations we are proposing interim final values for these codes per our usual process. (See section II.E.3.a.i.) These values are open for comment during the comment period for this final rule.

CPT codes 21800 (Closed treatment of rib fracture, uncomplicated, each), 22305 (Closed treatment of vertebral process fracture(s)) and 27193 (Closed treatment of pelvic ring fracture, dislocation, diastasis or subluxation, without manipulation) were proposed for review as potentially misvalued codes.

Comment: We received no comments on these codes.

Response: We are finalizing our proposal to review these codes as potentially misvalued codes.

CPT codes 33960 (Prolonged extracorporeal circulation for cardiopulmonary insufficiency; initial day) and 33961 (Prolonged extracorporeal circulation for cardiopulmonary insufficiency; each subsequent day) were proposed for review because the service was originally valued when it was used primarily in premature neonates; but the service is now being furnished to adults with severe influenza, pneumonia and respiratory distress syndrome. We also noted in the proposed rule that, while the code currently includes 523 minutes of total physician time with 133 minutes of intraservice time, physicians are not typically furnishing the service over that entire time interval; rather, hospital-employed pump technicians are furnishing much of the work.

Comment: We received no comments on these codes.

Response: We are finalizing our proposal to review these codes as potentially misvalued codes.

CPT codes 47560 (Laparoscopy, surgical; with guided transhepatic cholangiography, without biopsy), 47562 (Laparoscopy, surgical; cholecystectomy) and 47563 (Laparoscopy, surgical; cholecystectomy with cholangiography) were proposed as potentially misvalued because the more extensive code (CPT 47560) has lower work RVUs than the less extensive codes (CPT 47562 and CPT 47563).

Comment: We received a comment suggesting that these codes were not potentially misvalued and urging us not to finalize our proposal, stating that 47562 and 47563 describe more complex surgical procedures and both have a 090-day global period while 47560 has a 000-day global period.

Response: We acknowledge that the codes have different global periods, but believe that questions remain about how these codes should be valued. Therefore, we are finalizing our proposal to review these codes as potentially misvalued codes.

CPT codes 55845 (Prostatectomy, retropubic radical, with or without nerve sparing; with bilateral pelvic lymphadenectomy, including external iliac, hypogastric, and obturator nodes) and 55866 (Laparoscopy, surgical prostatectomy, retropubic radial, including nerve sparing, includes robotic assistance, when performed) were proposed as potentially misvalued because the RVUs for the laparoscopic procedure (CPT 55866) are higher than those for the open procedure (CPT 55845) and we believe that, in general, a laparoscopic procedure would not require greater resources than the open procedure.

Comment: A few comments suggested that these codes were not potentially misvalued because the laparoscopic code (CPT 55866) does require a higher level of work than the open procedure (CPT 55845) so the codes are in the appropriate rank order. One commenter stated that they had submitted an action plan for the review of these codes at the October 2013 AMA RUC meeting, and suggested that we defer any action on these codes until the AMA RUC review process is complete. Another commenter agreed that they were potentially misvalued saying that we should pay the same rate for both codes.

Response: Although most of the commenters indicated that it was appropriate that RVUs be higher for CPT code 55866 (laparoscopic procedure) than for CPT code 55845 (open procedure), we believe that there is enough question about how these codes should be valued that we are finalizing the proposal to review these codes as potentially misvalued codes. We note that we consider AMA RUC recommendations through our usual review of potentially misvalued codes.

We proposed CPT 64566 (Posterior tibial neurostimulation, percutaneous needle electrode, single treatment, includes programming) as a potentially misvalued code because the current valuation is based on the procedure being furnished by a physician, but we think that the procedure typically is furnished by auxiliary personnel with physician supervision (rather than by a physician).

Comment: We received a few comments stating that this code is not misvalued and urged us not to finalize our proposal. One commenter disagrees that CPT code 64566 is potentially misvalued and stated that the current work RVU of 0.60 is appropriate and should be maintained.

Response: We believe that further review is needed to determine if this procedure is typically performed by the physician, or the auxiliary personnel with physician supervision. Therefore, we are finalizing our proposal to review the codes described above as potentially misvalued codes.

We proposed CPT code 76942 (Ultrasonic guidance for needle placement (for example, biopsy, aspiration, injection, localization device), imaging supervision and interpretation) as a potentially misvalued code because of the high frequency with which it is billed with CPT code 20610 (Arthrocentesis, aspiration and/or injection; major joint or bursa (for example, shoulder, hip, knee joint, subacromial bursa). As we noted in the proposed rule, we are concerned about potential overutilization of these codes and it was suggested that the payment for CPT code 76942 and CPT code 20610 should be bundled to reduce the incentive for providers to always provide and bill separately for ultrasound guidance.

We also noted in the proposed rule that we were proposing to revise the direct PE inputs for CPT code 76942 because claims data shows that the procedure time assumption for CPT code 76942 is longer than that for the typical procedure with which the code is billed (CPT code 20610). The direct PE inputs and procedure time for CPT code 76942 are addressed in detail in section II.B.4.f. of this final rule with comment period. We further explained in the proposed rule that the discrepancy in procedure times and the resulting potentially inaccurate payment raises a fundamental concern regarding the incentive to furnish ultrasound guidance.

Comment: We received a comment saying that this code is undervalued, several comments indicating that the reduction of time and other inputs would be inappropriate and some comments suggesting that we should delay action until the AMA RUC can review and provide its recommendation.

Response: Based on the diversity of the comments received about the valuation of this code, we are finalizing our proposal to review it as a potentially misvalued code. This action is consistent with the comment recommending that we delay action until the AMA RUC acts because we routinely consider AMA RUC recommendations through our usual review of potentially misvalued codes. Thus, we would seek the AMA RUC recommendation before re-valuing.

As we noted in the proposed rule that given our concerns with CPT code 76942, we have similar concerns with other codes for ultrasound guidance. Accordingly, we proposed the following additional ultrasound guidance codes as potentially misvalued.

Table 12—Ultrasound Guidance Codes Proposed as Potentially Misvalued Back to Top
CPT code Short descriptor
76930 Echo guide cardiocentesis.
76932 Echo guide for heart biopsy.
76936 Echo guide for artery repair.
76940 US guide tissue ablation.
76948 Echo guide ova aspiration.
76950 Echo guidance radiotherapy.
76965 Echo guidance radiotherapy.

Comment: We received some comments asking us not to treat 76930, 76932, and 76936 as potentially misvalued codes stating that these codes are not misvalued but without providing information to support the contention. One commenter stated that 76936 should be removed from the list because it is not an image guidance technique used to supplement a surgical procedure.

Response: We agree that code 76936 is not a code used to supplement a surgical procedure and therefore does not raise the concerns we discussed in the proposed rule. Accordingly, it will not be included on the list of potentially misvalued codes. The comments on codes 76930 and 76932 provided insufficient information to persuade us that these codes should not be considered potentially misvalued. Given that the identification of a code as potentially misvalued merely assures that the current values are evaluated to determine whether changes are warranted, we are finalizing our proposal to consider codes 76930 and 76932 as potentially misvalued.

In summary, the following codes are finalized as potentially misvalued codes.

Table 13—Potentially Misvalued CPT Codes Back to Top
CPT code Short descriptor
21800 Treatment of rib fracture.
22305 Closed tx spine process fx.
27193 Treat pelvic ring fracture.
33960 External circulation assist.
33961 External circulation assist, each subsequent day.
47560 Laparoscopy w/cholangio.
47562 Laparoscopic cholecystectomy.
47563 Laparo cholecystectomy/graph.
55845 Extensive prostate surgery.
55866 Laparo radical prostatectomy.
64566 Neuroeltrd stim post tibial.
76930 Echo guide cardiocentesis.
76932 Echo guide for heart biopsy.
76940 US guide tissue ablation.
76942 Echo guide for biopsy.
76948 Echo guide ova aspiration.
76950 Echo guidance radiotherapy.
76965 Echo guidance radiotherapy.

We will accept public nominations of potentially misvalued codes with supporting documentation as described in section II.C.3.a. of this final rule with comment period in the CY 2015 proposed rule.

ii. Number of Visits and Physician Time in Selected Global Surgical Packages

In the CY 2013 proposed rule, we sought comments on methods of obtaining accurate and current data on E/M services furnished as part of a global surgical package. Commenters provided a variety of suggestions including setting the all surgical services to a 0-day global period, requiring all E/M services to be separately billed, validating the global surgical packages with the hospital Diagnosis-Related Group length of stay data, and setting auditable documentation standards for post-operative E/M services. In addition to the broader comments, the AMA RUC noted that many surgical procedures did not have the correct hospital and discharge day management services in the global period, resulting in incorrect times in the time file. The AMA RUC submitted post-operative visits and times for the services that we had displayed with zero visits in the CMS time file with the CY 2013 proposed rule. The AMA RUC suggested that the errors may have resulted from the inadvertent removal of the visits from the time file in 2007. We responded to this comment in the CY 2013 final rule with comment period by saying that we would review this file and, if appropriate, propose modifications. We noted in the CY 2013 final rule with comment period that if time had been removed from the physician time file inadvertently, it would have resulted in a small impact on the indirect allocation of PE at the specialty level, but it would not have affected the physician work RVUs or direct PE inputs for these services. It would have a small impact on the indirect allocation of PE at the specialty level, which we would review when we explore this potential time file change.

After extensive review, we believe that the data were deleted from the time file due to an inadvertent error as noted by the AMA RUC. To correct this inadvertent error, in the CY2014 proposed rule, we proposed to replace the missing post-operative hospital E/M visit information and time for the 117 codes that were identified by the AMA RUC and displayed in Table 14. Thus, we believe this correction will populate the physician time file with data that, absent the inadvertent error, would have been present in the time file.

Table 14—Global Surgical Package Visits and Physician Time Changes Back to Top
CPT code Short descriptor Visits included in Global Package1 CY 2013 physician time CY 2014 physician time
99231 99232 99238 99291
1We note that in the CY 2014 proposed rule, this table displayed only whole numbers of visits, although the actual time file and our ratesetting calculations use data to two places beyond the decimal point.
19368 Breast reconstruction 4.00 1.00 712.00 770.00
19369 Breast reconstruction 3.00 1.00 657.00 690.00
20100 Explore wound neck 2.00 1.00 218.00 266.00
20816 Replantation digit complete 5.00 1.00 671.00 697.00
20822 Replantation digit complete 3.00 1.00 587.00 590.00
20824 Replantation thumb complete 5.00 1.00 646.00 690.00
20827 Replantation thumb complete 4.00 1.00 610.00 625.00
20838 Replantation foot complete 8.00 1.00 887.00 986.00
20955 Fibula bone graft microvasc 6.00 1.00 1.00 867.00 957.00
20969 Bone/skin graft microvasc 8.00 1.00 1018.00 1048.00
20970 Bone/skin graft iliac crest 8.00 1.00 958.00 988.00
20973 Bone/skin graft great toe 5.00 1.00 1018.00 988.00
21139 Reduction of forehead 1.00 1.00 400.00 466.00
21151 Reconstruct midface lefort 2.00 1.00 1.00 567.00 686.00
21154 Reconstruct midface lefort 2.50 1.00 1.50 664.00 853.00
21155 Reconstruct midface lefort 2.00 1.00 2.00 754.00 939.00
21175 Reconstruct orbit/forehead 1.00 1.00 2.00 549.00 767.00
21182 Reconstruct cranial bone 1.00 1.00 2.00 619.00 856.00
21188 Reconstruction of midface 1.00 1.00 512.00 572.00
22100 Remove part of neck vertebra 2.00 1.00 397.00 372.00
22101 Remove part thorax vertebra 3.00 1.00 392.00 387.00
22110 Remove part of neck vertebra 6.00 1.00 437.00 479.00
22112 Remove part thorax vertebra 6.50 1.00 507.00 530.00
22114 Remove part lumbar vertebra 6.50 1.00 517.00 530.00
22210 Revision of neck spine 7.00 1.00 585.00 609.00
22212 Revision of thorax spine 7.00 1.00 610.00 640.00
22214 Revision of lumbar spine 7.00 1.00 585.00 624.00
22220 Revision of neck spine 6.50 1.00 565.00 585.00
22222 Revision of thorax spine 7.50 1.00 630.00 651.00
22224 Revision of lumbar spine 7.50 1.00 620.00 666.00
22315 Treat spine fracture 1.00 1.00 257.00 252.00
22325 Treat spine fracture 5.50 1.00 504.00 528.00
22326 Treat neck spine fracture 5.50 1.00 452.00 480.00
22327 Treat thorax spine fracture 9.00 1.00 505.00 604.00
22548 Neck spine fusion 8.00 1.00 1.00 532.00 673.00
22556 Thorax spine fusion 3.00 1.00 1.00 525.00 557.00
22558 Lumbar spine fusion 2.00 1.00 1.00 502.00 525.00
22590 Spine & skull spinal fusion 3.00 1.00 532.00 501.00
22595 Neck spinal fusion 6.00 1.00 492.00 521.00
22600 Neck spine fusion 6.00 1.00 437.00 490.00
22610 Thorax spine fusion 7.50 1.00 468.00 549.00
22630 Lumbar spine fusion 3.00 1.00 501.00 487.00
22800 Fusion of spine 7.00 1.00 517.00 571.00
22802 Fusion of spine 4.00 1.00 552.00 538.00
22804 Fusion of spine 5.00 1.00 630.00 595.00
22808 Fusion of spine 5.00 1.00 553.00 530.00
22810 Fusion of spine 5.00 1.00 613.00 595.00
22812 Fusion of spine 7.50 1.00 666.00 700.00
31582 Revision of larynx 8.00 1.00 489.00 654.00
32650 Thoracoscopy w/pleurodesis 2.00 1.00 322.00 290.00
32656 Thoracoscopy w/pleurectomy 3.00 1.00 419.00 377.00
32658 Thoracoscopy w/sac fb remove 1.00 1.00 362.00 330.00
32659 Thoracoscopy w/sac drainage 2.00 1.00 414.00 357.00
32661 Thoracoscopy w/pericard exc 1.00 1.00 342.00 300.00
32664 Thoracoscopy w/th nrv exc 1.00 1.00 362.00 330.00
32820 Reconstruct injured chest 3.50 1.00 4.50 631.00 854.00
33236 Remove electrode/thoracotomy 4.00 1.00 258.00 346.00
33237 Remove electrode/thoracotomy 5.00 1.00 378.00 456.00
33238 Remove electrode/thoracotomy 5.00 1.00 379.00 472.00
33243 Remove eltrd/thoracotomy 5.00 1.00 504.00 537.00
33321 Repair major vessel 8.00 1.00 751.00 754.00
33332 Insert major vessel graft 8.00 1.00 601.00 604.00
33401 Valvuloplasty open 8.00 1.00 830.00 661.00
33403 Valvuloplasty w/cp bypass 8.00 1.00 890.00 638.00
33417 Repair of aortic valve 2.50 1.00 2.50 740.00 750.00
33472 Revision of pulmonary valve 0.50 1.00 4.50 665.00 780.00
33502 Coronary artery correction 2.50 1.00 2.50 710.00 688.00
33503 Coronary artery graft 5.50 1.00 2.50 890.00 838.00
33504 Coronary artery graft 4.50 1.00 2.50 740.00 789.00
33600 Closure of valve 6.00 1.00 800.00 628.00
33602 Closure of valve 6.00 1.00 770.00 628.00
33606 Anastomosis/artery-aorta 8.00 1.00 860.00 728.00
33608 Repair anomaly w/conduit 5.00 1.00 800.00 668.00
33690 Reinforce pulmonary artery 2.50 1.00 2.50 620.00 636.00
33702 Repair of heart defects 0.50 1.00 3.50 663.00 751.00
33722 Repair of heart defect 5.00 1.00 770.00 608.00
33732 Repair heart-vein defect 5.00 1.00 710.00 578.00
33735 Revision of heart chamber 2.50 1.00 3.50 740.00 770.00
33736 Revision of heart chamber 5.00 1.00 710.00 548.00
33750 Major vessel shunt 2.00 1.00 3.00 680.00 722.00
33764 Major vessel shunt & graft 1.50 1.00 3.50 710.00 750.00
33767 Major vessel shunt 5.00 1.00 800.00 608.00
33774 Repair great vessels defect 0.50 1.00 6.50 845.00 998.00
33788 Revision of pulmonary artery 2.50 1.00 2.50 770.00 736.00
33802 Repair vessel defect 2.50 1.00 1.50 558.00 556.00
33803 Repair vessel defect 2.50 1.00 1.50 618.00 586.00
33820 Revise major vessel 1.00 1.00 1.00 430.00 414.00
33824 Revise major vessel 0.50 1.00 2.50 588.00 615.00
33840 Remove aorta constriction 1.50 1.00 2.50 588.00 639.00
33845 Remove aorta constriction 1.00 1.00 3.00 710.00 726.00
33851 Remove aorta constriction 2.00 1.00 3.00 603.00 700.00
33852 Repair septal defect 2.00 1.00 3.00 663.00 719.00
33853 Repair septal defect 8.00 1.00 800.00 668.00
33917 Repair pulmonary artery 5.00 1.00 740.00 608.00
33920 Repair pulmonary atresia 6.00 1.00 800.00 658.00
33922 Transect pulmonary artery 5.00 1.00 618.00 546.00
33974 Remove intra-aortic balloon 1.00 1.00 406.00 314.00
34502 Reconstruct vena cava 6.00 1.00 793.00 741.00
35091 Repair defect of artery 11.00 1.00 2.00 597.00 790.00
35694 Arterial transposition 2.00 1.00 468.00 456.00
35901 Excision graft neck 4.00 1.00 484.00 482.00
35903 Excision graft extremity 3.00 1.00 408.00 416.00
47135 Transplantation of liver 23.00 1.00 1501.00 1345.00
47136 Transplantation of liver 28.00 1.00 1301.00 1329.00
49422 Remove tunneled ip cath 1.00 1.00 154.00 182.00
49429 Removal of shunt 6.00 1.00 249.00 317.00
50320 Remove kidney living donor 4.00 1.00 480.00 524.00
50845 Appendico-vesicostomy 5.00 1.00 685.00 613.00
56632 Extensive vulva surgery 7.00 1.00 835.00 683.00
60520 Removal of thymus gland 2.00 1.00 2.00 406.00 474.00
60521 Removal of thymus gland 5.00 1.00 457.00 445.00
60522 Removal of thymus gland 7.00 1.00 525.00 533.00
61557 Incise skull/sutures 3.00 1.00 529.00 510.00
63700 Repair of spinal herniation 3.00 1.00 399.00 401.00
63702 Repair of spinal herniation 3.00 1.00 469.00 463.00
63704 Repair of spinal herniation 8.00 1.00 534.00 609.00
63706 Repair of spinal herniation 8.00 1.00 602.00 679.00

iii. Codes With Higher Total Medicare Payments in Office Than in Hospital or ASC

In the CY 2014 proposed rule with comment period, we proposed to address nearly 200 codes that we believe to have misvalued resource inputs. These are codes for which the total PFS payment when furnished in an office or other nonfacility setting would exceed the total Medicare payment (the combined payment to the facility and the professional) when the service is furnished in a facility, either a hospital outpatient department or an ASC.

For services furnished in a facility setting we would generally expect the combined payment to the facility and the practitioner to exceed the PFS payment made to the professional when the service is furnished in the nonfacility setting. This payment differential is expected because it reflects the greater costs we would expect to be incurred by facilities relative to physicians furnishing services in offices and other non-facility settings. These greater costs are due to higher overhead resulting from differences in regulatory requirements and for facilities, such as hospitals, maintaining the capacity to furnish services 24 hours per day and 7 days per week. However, when we analyzed such payments, we identified nearly 300 codes that would result in greater Medicare payment in the nonfacility setting than in the facility setting. We believe these anomalous site-of-service payment differentials are the result of inaccurate resource input data used to establish rates under the PFS.

We proposed to address these misvalued codes by refining the PE methodology to limit the nonfacility PE RVUs for individual codes so that the total nonfacility PFS payment amount would not exceed the total combined payment under the PFS and the OPPS (or the ASC payment system) when the service is furnished in the facility setting.

Section II.B.3 discusses the comment received on this misvalued code proposal and our response to these comments.

4. Multiple Procedure Payment Reduction Policy

Medicare has long employed multiple procedure payment reduction (MPPR) policies to adjust payment to more appropriately reflect reduced resources involved with furnishing services that are frequently furnished together. Under these policies, we reduce payment for the second and subsequent services within the same MPPR category furnished in the same session or same day. These payment reductions reflect efficiencies that typically occur in either the PE or professional work or both when services are furnished together. With the exception of a few codes that are always reported with another code, the PFS values services independently to recognize relative resources involved when the service is the only one furnished in a session. Although some of our MPPR policies precede the Affordable Care Act, MPPRs can address the fourth category of potentially misvalued codes identified in section 1848(c)(2)(K) of the Act, as added by the Affordable Care Act, which is “multiple codes that are frequently billed in conjunction with furnishing a single service” (see 75 FR 73216). The following sections describe the history of MPPRs and the services currently covered by MPPRs.

a. Background

Medicare has a longstanding policy to reduce payment by 50 percent for the second and subsequent surgical procedures furnished to the same beneficiary by a single physician or physicians in the same group practice on the same day, largely based on the presence of efficiencies in the PE and pre- and post-surgical physician work. Effective January 1, 1995, the MPPR policy, with this same percentage reduction, was extended to nuclear medicine diagnostic procedures (CPT codes 78306, 78320, 78802, 78803, 78806, and 78807). In the CY 1995 PFS final rule with comment period (59 FR 63410), we indicated that we would consider applying the policy to other diagnostic tests in the future.

Consistent with recommendations of MedPAC in its March 2005 Report to the Congress on Medicare Payment Policy, for CY 2006 PFS, we extended the MPPR policy to the TC of certain diagnostic imaging procedures furnished on contiguous areas of the body in a single session (70 FR 70261). This MPPR policy recognizes that for the second and subsequent imaging procedures furnished in the same session, there are some efficiencies in clinical labor, supplies, and equipment time. In particular, certain clinical labor activities and supplies are not duplicated for subsequent imaging services in the same session and, because equipment time and indirect costs are allocated based on clinical labor time, adjustment to those figures is appropriate as well.

The imaging MPPR policy originally applied to computed tomography (CT) and computed tomographic angiography (CTA), magnetic resonance imaging (MRI) and magnetic resonance angiography (MRA), and ultrasound services within 11 families of codes based on imaging modality and body region, and only applied to procedures furnished in a single session involving contiguous body areas within a family of codes. Additionally, this MPPR policy originally applied to TC-only services and to the TC of global services, but not to professional component (PC) services.

There have been several revisions to this policy since it was originally adopted. Under the current imaging MPPR policy, full payment is made for the TC of the highest paid procedure, and payment for the TC is reduced by 50 percent for each additional procedure subject to this MPPR policy. We originally planned to phase in the imaging MPPR policy over a 2-year period, with a 25 percent reduction in CY 2006 and a 50 percent reduction in CY 2007 (70 FR 70263). However, section 5102(b) of the Deficit Reduction Act of 2005 (DRA) (Pub. L. 109-171, enacted on December 20, 2006) amended the statute to place a cap on the PFS payment amount for most imaging procedures at the amount paid under the hospital OPPS. In view of this new OPPS payment cap, we decided in the CY 2006 PFS final rule with comment period that it would be prudent to retain the imaging MPPR at 25 percent while we continued to examine the appropriate payment levels (71 FR 69659). The DRA also exempted reduced expenditures attributable to the imaging MPPR policy from the PFS budget neutrality provision. Effective July 1, 2010, section 1848(b)(4)(C) of the Act increased the MPPR on the TC of imaging services under the policy established in the CY 2006 PFS final rule with comment period from 25 to 50 percent. Section 1848(c)(2)(B)(v)(IV) of the Act exempted the reduced expenditures attributable to this further change from the PFS budget neutrality provision.

In the July 2009 U.S. Government Accountability Office (GAO) report entitled, Medicare Physician Payments: Fees Could Better Reflect Efficiencies Achieved when Services are Provided Together, the GAO recommended that we take further steps to ensure that fees for services paid under the PFS reflect efficiencies that occur when services are furnished by the same physician to the same beneficiary on the same day. The GAO report recommended the following: (1) Expanding the existing imaging MPPR policy for certain services to the PC to reflect efficiencies in physician work for certain imaging services; and (2) expanding the MPPR to reflect PE efficiencies that occur when certain nonsurgical, nonimaging services are furnished together. The GAO report also encouraged us to focus on service pairs that have the most impact on Medicare spending.

In its March 2010 report, MedPAC noted its concerns about mispricing of services under the PFS. MedPAC indicated that it would explore whether expanding the unit of payment through packaging or bundling would improve payment accuracy and encourage more efficient use of services. In the CY 2009 and CY 2010 PFS proposed rules (73 FR 38586 and 74 FR 33554, respectively), we stated that we planned to analyze nonsurgical services commonly furnished together (for example, 60 to 75 percent of the time) to assess whether an expansion of the MPPR policy could be warranted. MedPAC encouraged us to consider duplicative physician work, as well as PE, in any expansion of the MPPR policy.

Section 1848(c)(2)(K) of the Act specifies that the Secretary shall identify potentially misvalued codes by examining multiple codes that are frequently billed in conjunction with furnishing a single service, and review and make appropriate adjustments to their relative values. As a first step in applying this provision, in the CY 2010 final rule with comment period, we implemented a limited expansion of the imaging MPPR policy to additional combinations of imaging services.

Effective January 1, 2011, the imaging MPPR applies regardless of code family; that is, the policy applies to multiple imaging services furnished within the same family of codes or across families. This policy is consistent with the standard PFS MPPR policy for surgical procedures that does not group procedures by body region. The current imaging MPPR policy applies to CT and CTA, MRI and MRA, and ultrasound procedures furnished to the same beneficiary in the same session, regardless of the imaging modality, and is not limited to contiguous body areas.

As we noted in the CY 2011 PFS final rule with comment period (75 FR 73228), although section 1848(c)(2)(B)(v)(VI) of the Act specifies that reduced expenditures attributable to the increase in the imaging MPPR from 25 to 50 percent (effective for fee schedules established beginning with 2010 and for services furnished on or after July 1, 2010) are excluded from the PFS budget neutrality adjustment, it does not apply to reduced expenditures attributable to our policy change regarding additional code combinations across code families (noncontiguous body areas) that are subject to budget neutrality under the PFS. The complete list of codes subject to the CY 2011 MPPR policy for diagnostic imaging services is included in Addendum F.

As a further step in applying the provisions of section 1848(c)(2)(K) of the Act, on January 1, 2011, we implemented an MPPR for therapy services. The MPPR applies to separately payable “always therapy” services, that is, services that are only paid by Medicare when furnished under a therapy plan of care. As we explained in the CY 2011 PFS final rule with comment period (75 FR 73232), the therapy MPPR does not apply to contractor-priced codes, bundled codes, or add-on codes.

This MPPR for therapy services was first proposed in the CY 2011 proposed rule (75 FR 44075) as a 50 percent payment reduction to the PE component of the second and subsequent therapy services for multiple “always therapy” services furnished to a single beneficiary in a single day. It applies to services furnished by an individual or group practice or “incident to” a physician's service. However, in response to public comments, in the CY 2011 PFS final rule with comment period (75 FR 73232), we adopted a 25 percent payment reduction to the PE component of the second and subsequent therapy services for multiple “always therapy” services furnished to a single beneficiary in a single day.

Subsequent to publication of the CY 2011 PFS final rule with comment period, section 3 of the Physician Payment and Therapy Relief Act of 2010 (PPTRA) (Pub. L. 111-286) revised the payment reduction percentage from 25 percent to 20 percent for therapy services for which payment is made under a fee schedule under section 1848 of the Act (which are services furnished in office settings, or non-institutional services). The payment reduction percentage remained at 25 percent for therapy services furnished in institutional settings. Section 4 of the PPTRA exempted the reduced expenditures attributable to the therapy MPPR policy from the PFS budget neutrality provision. Section 633 of the ATRA revised the reduction to 50 percent of the PE component for all settings, effective April 1, 2013. Therefore, full payment is made for the service or unit with the highest PE and payment for the PE component for the second and subsequent procedures or additional units of the same service is reduced by 50 percent for both institutional and non-institutional services.

This MPPR policy applies to multiple units of the same therapy service, as well as to multiple different “always therapy” services, when furnished to the same beneficiary on the same day. The MPPR applies when multiple therapy services are billed on the same date of service for one beneficiary by the same practitioner or facility under the same National Provider Identifier (NPI), regardless of whether the services are furnished in one therapy discipline or multiple disciplines, including physical therapy, occupational therapy, or speech-language pathology.

The MPPR policy applies in all settings where outpatient therapy services are paid under Part B. This includes both services that are furnished in the office setting and paid under the PFS, as well as institutional services that are furnished by outpatient hospitals, home health agencies, comprehensive outpatient rehabilitation facilities (CORFs), and other entities that are paid for outpatient therapy services at rates based on the PFS.

In its June 2011 Report to Congress, MedPAC highlighted continued growth in ancillary services subject to the in-office ancillary services exception. The in-office ancillary exception to the physician self-referral prohibition in section 1877 of the Act, also known as the Stark law, allows physicians to refer Medicare beneficiaries to their own group practices for designated health services, including imaging, radiation therapy, home health care, clinical laboratory tests, and physical therapy, if certain conditions are met. MedPAC recommended that we curb overutilization by applying a MPPR to the PC of diagnostic imaging services furnished by the same practitioner in the same session. As noted above, the GAO already had made a similar recommendation in its July 2009 report.

In continuing to apply the provisions of section 1848(c)(2)(K) of the Act regarding potentially misvalued codes that result from “multiple codes that are frequently billed in conjunction with furnishing a single service,” in the CY 2012 final rule (76 FR 73071), we expanded the MPPR to the PC of Advanced Imaging Services (CT, MRI, and Ultrasound), that is, the same list of codes to which the MPPR on the TC of advanced imaging already applied. Thus, this MPPR policy now applies to the PC and the TC of certain diagnostic imaging codes. Specifically, we expanded the payment reduction currently applied to the TC to apply also to the PC of the second and subsequent advanced imaging services furnished by the same physician (or by two or more physicians in the same group practice) to the same beneficiary in the same session on the same day. However, in response to public comments, in the CY 2012 PFS final rule with comment period, we adopted a 25 percent payment reduction to the PC component of the second and subsequent imaging services.

Under this policy, full payment is made for the PC of the highest paid advanced imaging service, and payment is reduced by 25 percent for the PC for each additional advanced imaging service furnished to the same beneficiary in the same session. This policy was based on the expected efficiencies in furnishing multiple services in the same session due to duplication of physician work, primarily in the pre- and post-service periods, but with some efficiencies in the intraservice period.

This policy is consistent with the statutory requirement for the Secretary to identify, review, and adjust the relative values of potentially misvalued services under the PFS as specified by section 1848(c)(2)(K) of the Act. This policy is also consistent with our longstanding policies on surgical and nuclear medicine diagnostic procedures, under which we apply a 50 percent payment reduction to second and subsequent procedures. Furthermore, it was responsive to continued concerns about significant growth in imaging spending, and to MedPAC (March 2010 and June 2011) and GAO (July 2009) recommendations regarding the expansion of MPPR policies under the PFS to account for additional efficiencies.

In the CY 2013 final rule (77 FR 68933), we expanded the MPPR to the TC of certain cardiovascular and ophthalmology diagnostic tests. Although we proposed a 25 percent reduction for both diagnostic cardiovascular and ophthalmology services, we adopted a 20 percent reduction for ophthalmology services in the final rule with comment period (77 FR 68941) in response to public comments. For diagnostic cardiovascular services, full payment is made for the procedure with the highest TC payment, and payment is reduced by 25 percent for the TC for each additional procedure furnished to the same patient on the same day. For diagnostic ophthalmology services, full payment is made for the procedure with the highest TC payment, and payment is reduced by 20 percent for the TC for each additional procedure furnished to the same patient on the same day.

We did not propose and are not adopting any new MPPR policies for CY 2014. However, we continue to look at expanding the MPPR based on efficiencies when multiple procedures are furnished together.

The complete list of services subject to the MPPRs on diagnostic imaging services, therapy services, diagnostic cardiovascular services and diagnostic ophthalmology services is shown in Addenda F, H, I, and J. We note that Addenda H, which lists services subject to the MPPR on therapy services, contains four new CPT codes. Specifically, CPT code 92521 (Evaluation of speech fluency), 92522 (Evaluate speech sound production), 92523 (Speech sound language comprehension) and 92524 (Behavioral and qualitative analysis of voice and resonance) are being added to the list. These codes replace CPT code 92506 (Speech/hearing evaluation) for CY 2014. Accordingly, CPT 92506 has been deleted from Addenda H. Like CPT 92506, these new codes are “always therapy” services that are only paid by Medicare when furnished under a therapy plan of care. Thus, like CPT 92506, they are subject to the MPPR for therapy services. They have been added to the list of services subject to the MPPR on therapy services on an interim final basis, and are open to public comment on this final rule with comment period.

C. Malpractice RVUs

Section 1848(c) of the Act requires that each service paid under the PFS be composed of three components: work, PE, and malpractice. From 1992 to 1999, malpractice RVUs were charge-based, using weighted specialty-specific malpractice expense percentages and 1991 average allowed charges. Malpractice RVUs for new codes after 1991 were extrapolated from similar existing codes or as a percentage of the corresponding work RVU. Section 4505(f) of the BBA, which amended section 1848(c) of the Act, required us to implement resource-based malpractice RVUs for services furnished beginning in 2000. Therefore, initial implementation of resource-based malpractice RVUs occurred in 2000.

The statute also requires that we review and, if necessary, adjust RVUs no less often than every 5 years. The first review and corresponding update of resource-based malpractice RVUs was addressed in the CY 2005 PFS final rule with comment period (69 FR 66263). Minor modifications to the methodology were addressed in the CY 2006 PFS final rule with comment period (70 FR 70153). In the CY 2010 PFS final rule with comment period, we implemented the second review and corresponding update of malpractice RVUs. For a discussion of the second review and update of malpractice RVUs, see the CY 2010 PFS proposed rule (74 FR 33537) and final rule with comment period (74 FR 61758).

As explained in the CY 2011 PFS final rule with comment period (75 FR 73208), malpractice RVUs for new codes, revised codes and codes with revised work RVUs (new/revised codes) effective before the next five-year review of malpractice RVUs (for example, effective CY 2011 through CY 2014, assuming that the next review of malpractice RVUs occurs for CY 2015) are determined either by a direct crosswalk from a similar source code or by a modified crosswalk to account for differences in work RVUs between the new/revised code and the source code. For the modified crosswalk approach, we adjust (or “scale”) the malpractice RVU for the new/revised code to reflect the difference in work RVU between the source code and the new/revised work value (or, if greater, the clinical labor portion of the PE RVU) for the new code. For example, if the proposed work RVU for a revised code is 10 percent higher than the work RVU for its source code, the malpractice RVU for the revised code would be increased by 10 percent over the source code malpractice RVU. This approach presumes the same risk factor for the new/revised code and source code but uses the work RVU for the new/revised code to adjust for the difference in risk attributable to the variation in work between the two services.

For CY 2014, we use this approach for determining malpractice RVUs for new/revised codes. A list of new/revised codes and the malpractice crosswalks used to determine their malpractice RVUs are in Sections II.E.2.c and 3.c in this final rule with comment period. The CY 2014 malpractice RVUs for interim final codes are being implemented in the CY 2014 PFS final rule with comment period. These RVUs are subject to public comment. After considering public comments, they will then be finalized in the CY 2015 PFS final rule with comment period.

D. Medicare Economic Index (MEI)

1. Revising of the Medicare Economic Index (MEI)

a. Background

The Medicare Economic Index (MEI) is authorized under section 1842(b)(3) of the Act, which states that prevailing charge levels beginning after June 30, 1973 may not exceed the level from the previous year except to the extent that the Secretary finds, on the basis of appropriate economic index data, that such a higher level is justified by year-to-year economic changes. Beginning July 1, 1975, and continuing through today, the MEI has met this requirement by reflecting the weighted-average annual price change for various inputs involved in furnishing physicians' services. The MEI is a fixed-weight input price index, with an adjustment for the change in economy-wide, private nonfarm business multifactor productivity. This index is comprised of two broad categories: (1) physicians' own time; and (2) physicians' practice expense (PE).

The current general form of the MEI was described in the November 25, 1992 Federal Register (57 FR 55896) and was based in part on the recommendations of a Congressionally-mandated meeting of experts held in March 1987. Since that time, the MEI has been updated or revised on four instances. First, the MEI was rebased in 1998 (63 FR 58845), which moved the cost structure of the index from 1992 data to 1996 data. Second, the methodology for the productivity adjustment was revised in the CY 2003 PFS final rule with comment period (67 FR 80019) to reflect the percentage change in the 10-year moving average of economy-wide private nonfarm business multifactor productivity. Third, the MEI was rebased in 2003 (68 FR 63239), which moved the cost structure of the index from 1996 data to 2000 data. Fourth, the MEI was rebased in 2011 (75 FR 73262), which moved the cost structure of the index from 2000 data to 2006 data.

The terms “rebasing” and “revising,” while often used interchangeably, actually denote different activities. Rebasing refers to moving the base year for the structure of costs of a price index, while revising relates to other types of changes such as changing data sources, cost categories, or price proxies used in the price index. For CY 2014, we proposed to revise the MEI based on the recommendations of the MEI Technical Advisory Panel (TAP). We did not propose to rebase the MEI and will continue to use the data from 2006 to estimate the cost weights, since these are the most recently available, relevant, and complete data we have available to develop these weights.

b. MEI Technical Advisory Panel (TAP) Recommendations

The MEI-TAP was convened to conduct a technical review of the MEI, including the inputs, input weights, price-measurement proxies, and productivity adjustment. After considering these issues, the MEI-TAP was asked to assess the relevance and accuracy of inputs relative to current physician practices. The MEI-TAP's analysis and recommendations were to be considered in future rulemaking to ensure that the MEI accurately and appropriately meets its intended statutory purpose.

The MEI-TAP consisted of five members and held three meetings in 2012: May 21; June 25; and July 11. It produced eight findings and 13 recommendations for consideration by CMS. Background on the MEI-TAP members, meeting transcripts for all three meetings, and the MEI-TAP's final report, including all findings and recommendations, are available at http://www.cms.gov/Regulations-and-Guidance/Guidance/FACA/MEITAP.html. We have determined, as noted in the proposed rule, that it is possible to implement some of the recommendations immediately, while more in-depth research is required to address several of the other recommendations.

For CY 2014, we proposed to implement 10 of the 13 recommendations made by the MEI-TAP. The remaining recommendations require more in-depth research, and we will continue evaluating these three recommendations and will propose any further changes to the MEI in future rulemaking. The CY 2014 changes only involve revising the MEI categories, cost shares, and price proxies. Again, we did not propose to rebase the MEI for CY 2014 since the MEI-TAP concluded that there is not a newer, reliable, or ongoing source of data to maintain the MEI.

c. Overview of Revisions

The MEI was last rebased and revised in the CY 2011 PFS final rule with comment period (75 FR 73262—73275). The current base year for the MEI is 2006, which means that the cost weights in the index reflect physicians' expenses in 2006. The details of the methodology used to determine the 2006 cost shares were provided in the CY 2011 PFS proposed rule and finalized in the CY 2011 PFS final rule with comment period (75 FR 40087 and 75 FR 73262, respectively). For CY 2014 we proposed to make the following revisions to the 2006-based MEI:

(1) Reclassify and revise certain cost categories:

  • Reclassify expenses for non-physician clinical personnel that can bill independently from non-physician compensation to physician compensation.
  • Revise the physician wage and benefit split so that the cost weights are more in line with the definitions of the price proxies used for each category.
  • Add an additional subcategory under non-physician compensation for health-related workers.
  • Create a new cost category called “All Other Professional Services” that includes expenses covered in the current MEI categories: “All Other Services” and “Other Professional Expenses.” The “All Other Professional Services” category would be further disaggregated into appropriate occupational subcategories.
  • Create an aggregate cost category called “Miscellaneous Office Expenses” that would include the expenses for “Rubber and Plastics,” “Chemicals,” “All Other Products,” and “Paper.”

(2) Revise price proxies:

  • Revise the price proxy for physician wages and salaries from the Average Hourly Earnings (AHE) for the Total Private Nonfarm Economy for Production and Nonsupervisory Workers to the ECI for Wages and Salaries, Professional and Related Occupations, Private Industry.
  • Revise the price proxy for physician benefits from the ECI for Benefits for the Total Private Industry to the ECI for Benefits, Professional and Related Occupations, Private Industry.
  • Use the ECI for Wages and Salaries and the ECI for Benefits of Hospital, Civilian workers (private industry) as the price proxies for the new category of non-physician health-related workers.
  • Use ECIs to proxy the Professional Services occupational subcategories that reflect the type of professional services purchased by physicians' offices.
  • Revise the price proxy for the fixed capital category from the CPI for Owners' Equivalent Rent of Residences to the PPI for Lessors of Nonresidential Buildings (NAICS 53112).

d. Revising Expense Categories in the MEI

We did not propose any changes in the methodology for estimating the cost shares as finalized in the CY 2011 PFS final rule with comment period (75 FR 73263-73267). For CY 2014, we proposed to revise the classification of certain expenses within the 2006-based MEI. The details of the proposed revisions and the MEI-TAP recommendation that is the impetus for each of the revisions can be found in the CY 2014 PFS proposed rule (78 FR 43312-43316). The following sections summarize the proposed revisions to the cost weights for CY 2014.

(1) Overall MEI Cost Weights.

Table 15 lists the set of mutually exclusive and exhaustive cost categories and weights that were proposed for CY 2014. A comparison of the proposed revised MEI cost categories and cost shares to the 2006-based MEI cost categories and cost shares as finalized in the CY 2011 PFS final rule can be found at 78 FR 43312-43313.

Based on the proposed revisions to the MEI for CY 2014, the proposed physician compensation cost weight under the revised MEI is 2.600 percentage points higher than the physician compensation weight in the current MEI. This change occurs because of the reclassification of expenses for non-physician clinical staff that can bill independently from non-physician compensation to physician compensation. This change lowers the PE cost weight by 2.600 percent as well, all of which comes from a lower weight for non-physician compensation. The remaining MEI cost weights are unchanged.

The proposed revised MEI includes four new detailed cost categories and two new sub-aggregate cost categories. The new detailed cost categories are:

  • Health-related, non-physician wages and salaries.
  • Professional, scientific, and technical services.
  • Administrative support and waste management services.
  • All other services.

The new sub-aggregate categories are:

  • Non-health, non-physician wages.
  • Miscellaneous office expenses.

The proposed revised MEI excludes two sub-aggregate categories that were included in the current 2006-based MEI. The sub-aggregate categories removed are:

  • Office expenses.
  • Drugs & supplies.
Table 15—Revised 2006 MEI Cost Categories and, Weights Back to Top
Revised cost category Revised weights (percent)
[Revised MEI (2006=100), CY2014]
* The term (2006=100) refers to the base year of the MEI.
Physician Compensation 50.866
Wages and Salaries 43.641
Benefits 7.225
Practice Expense 49.134
Non-physician compensation 16.553
Non-physician wages 11.885
Non-health, non-physician wages 7.249
Professional and Related 0.800
Management 1.529
Clerical 4.720
Services 0.200
Health related, non-physician wages 4.636
Non-physician benefits 4.668
Other Practice Expense 32.581
Utilities 1.266
Miscellaneous Office Expenses 2.478
Chemicals 0.723
Paper 0.656
Rubber & Plastics 0.598
All other products 0.500
Telephone 1.501
Postage 0.898
All Other professional services 8.095
Professional, scientific, & technical services 2.592
Administrative support & waste management 3.052
All other services 2.451
Capital 10.310
Fixed Capital 8.957
Moveable Capital 1.353
Professional Liability Insurance 4.295
Medical Equipment 1.978
Medical supplies 1.760
Total MEI 100.000

(2) Physician Compensation (Own Time)

The component of the MEI that reflects the physician's own time is represented by the net income portion of business receipts. The 2006 cost weight associated with the physician's own time (otherwise referred to as the Physician's Compensation cost weight) is based on 2006 AMA PPIS data for mean physician net income (physician compensation) for self-employed physicians and for the selected self-employed specialties. Expenses for employed physician compensation are combined with expenses for self-employed physician compensation to obtain an aggregate Physician Compensation cost weight. Based on this methodology, the Physician Compensation cost weight in the current MEI is 48.266 percent. For CY 2014, we proposed to reclassify the expenses for non-physician practitioners that can bill independently from the non-physician cost category in the MEI to the physician compensation cost category for several reasons:

  • These types of practitioners furnish services that are similar to those furnished by physicians.
  • If billing independently, these practitioners would be paid at a percentage of the physicians' services or in certain cases at the same rate as physicians.
  • The expenses related to the work components for the RVUs would include work from clinical staff that can bill independently. Therefore, it would improve consistency with the RVU payments to include these expenses as physician compensation in the MEI.

The effect of moving the expenses related to clinical staff that can bill independently is to increase the physician compensation cost share by 2.600 percentage points and to reduce the non-physician compensation cost share by the same amount. The physician compensation cost share for the proposed revised MEI is 50.866 percent compared to the physician compensation cost share of 48.266 percent in the current MEI.

Within the physician compensation cost weight, the MEI includes a separate weight for wages and salaries and a separate weight for benefits. Under the current 2006-based MEI, the ratio for wages and salaries, and benefits was calculated using data from the PPIS.

Based on MEI-TAP recommendation 3.1 we proposed to revise the wage and benefit split used for physician compensation. Specifically, we proposed to apply the distribution from the Statistics of Income (SOI) data to both self-employed and employed physician compensation. In reviewing the detailed AMA PPIS survey questions, it was clear that self-employed physician benefits were mainly comprised of insurance costs while other benefits such as physician retirement, paid leave, and payroll taxes were likely included in physician wages and salaries.

By definition, the price proxy used for physician benefits, which is an Employment Cost Index (ECI) concept, includes retirement savings. Thus, using the AMA PPIS data produced a definitional inconsistency between the cost weight and the price proxy. Therefore, we proposed to use the data on wages and salaries, and employee benefits from the SOI data for Offices of Physicians and Dentists for partnerships and corporations for both self-employed and employed physicians. From the SOI data, benefit expenses were estimated by summing the partnership data for retirement plans and employee benefit programs with corporation data for pension, profit-sharing plans and employee benefit programs. For 2006, the split between wages and salaries, and benefits was 85.8 percent and 14.2 percent, respectively. Retirement/pension plans account for about 60 percent of total benefits. The SOI data do not classify paid leave and supplemental pay as a benefit.

Combining the impact of classifying compensation for non-physicians that can bill independently as physician compensation with the use of the SOI data, the physician wages and salary cost share in the revised MEI is lower than the current MEI by 0.240 percentage points. These two methodological changes result in an increase in the physician benefit cost share in the revised MEI of 2.839 percentage points. As a result, the proposed physician wages and salary cost share for the revised MEI is 43.641 percent and the proposed physician benefit cost share for the revised MEI is 7.225 percent.

(3) Physician's Practice Expenses

To determine the PE cost weights, we use mean expense data from the 2006 PPIS survey. The derivation of the weights and categories for practice expenses is the same as finalized in the CY 2011 PFS final rule with comment period (75 FR 73264-73267), except where noted below.

(a) Non-Physician Employee Compensation

For CY 2014 we proposed to exclude the expenses related to non-physician clinical staff that can bill independently from this cost category. Moving the expenses related to the clinical staff that can bill independently out of non-physician compensation costs decreases the share by 2.600 percentage points. The non-physician compensation cost share for the revised MEI is 16.553 percent compared to the current physician compensation cost share of 19.153 percent.

We are further proposed to use the same method as finalized in the CY 2011 PFS final rule to split the non-physician compensation between wages and benefits. For reference, we use 2006 BLS Employer Costs for Employee Compensation (ECEC) data for the Health Care and Social Assistance (private industry). Data for 2006 in the ECEC for Health Care and Social Assistance indicate that wages and benefits are 71.8 percent and 28.2 percent of compensation, respectively. The non-physician wage and benefit cost shares for the revised MEI are 11.885 percent and 4.668 percent, respectively.

The current 2006-based MEI further disaggregated the non-physician wages into four occupational subcategories, the details of this method can be found in the CY 2011 PFS final rule with comment period (75 FR 73264-73265). Based on the MEI-TAP Recommendation 4.4, the Panel recommended the disaggregation of the non-physician compensation costs to include an additional category for health-related workers. The exact recommendation can be found at 78 FR 43314.

We proposed to implement this recommendation using expenses reported on the AMA PPIS for non-physician, non-health-related workers. The survey question asks for the expenses for: “non-clinical personnel involved primarily in administrative, secretarial or clerical activities (Including transcriptionists, medical records personnel, receptionists, schedulers and billing staff, coding staff, information technology staff, and custodial personnel).” Using this method, the proposed non-physician, non-health-related wage cost share for the revised MEI is 7.249 percent.

For wage costs of non-physician, health-related workers, the survey question asks for the expenses for: “other clinical staff, including RNs, LPNs, physicists, lab technicians, x-ray technicians, medical assistants, and other clinical personnel who cannot independently bill.” Using this method, the proposed non-physician, health-related wage cost share for the revised MEI is 4.636 percent. Together the non-health and health-related, non-physician wage costs sum to be equal to the total non-physician wage share in the revised MEI of 11.885 percent.

We further proposed to disaggregate the non-physician, non-health-related wage cost weight of 7.249 percent into four occupational subcategories. The methodology is similar to that finalized in the CY 2011 PFS final rule with comment period (75 FR 73264), in that we are using 2006 Current Population Survey (CPS) data and 2006 BLS Occupational Employment Statistics (OES) data to develop cost weights for wages for non-physician, non-health-related occupational groups. We determined total annual earnings for offices of physicians using employment data from the CPS and mean annual earnings from the OES. To arrive at a distribution for these separate occupational categories (Professional Related (P) workers, Managers, Clerical workers, and Service workers), we determined annual earnings for each using the Standard Occupational Classification (SOC) system. We then determined the overall share of the total for each. The proposed occupational distribution in the revised MEI is presented in Table 16. The comparison between the proposed revised distribution of non-physician payroll expense by occupational group to the prior comparison can be found in the CY 2014 PFS proposed rule at 78 FR43315.

Table 16—Percent Distribution of Non-Physician Payroll Expense by Occupational Group: Revised 2006-Based MEI Back to Top
Revised weight (percent) Revised Cost Category
[Revised MEI (2006=100)]
16.553 Non-physician compensation.
11.885 Non-physician wages.
7.249 Non-health, non-phys. wages.
0.800 Professional and Related.
1.529 Management.
4.720 Clerical.
0.200 Services.
4.636 Health related, non-phys. wages.
4.668 Non-physician benefits.

The health-related workers were previously included mainly in the Professional and Technical and Service Categories. The proposed reclassifications allow for health-related workers to be proxied by a health-specific ECI rather than an ECI for more general occupations.

(b) Other Practice Expense

The remaining expenses in the MEI are categorized as Other Practice Expenses. In the current 2006-based MEI we had classified other PEs in one of the following subcategories: Office Expenses; Drugs and Supplies; and All Other Professional Expenses. For CY 2014, we proposed to disaggregate these expenses in a way consistent with the MEI-TAP's recommendations, as detailed below.

We rely on the 2006 AMA PPIS data to determine the cost share for Other Practice Expenses. These expenses are the total of office expenses, medical supplies, medical equipment, Professional Liability Insurance (PLI), and all other professional expenses.

For the revised 2006-based MEI, we disaggregate Other Practice Expenses into 15 detailed subcategories as shown in Table 17.

Table 17—Revised Cost Categories for Other Practice Expense Back to Top
Revised cost category Revised weight (percent)
Other Practice Expense 32.581
Utilities 1.266
Miscellaneous Office Expenses 2.478
Chemicals 0.723
Paper 0.656
Rubber & Plastics 0.598
All other products 0.500
Telephone 1.501
Postage 0.898
All Other professional services 8.095
Professional, Scientific, and Tech. Services 2.592
Administrative support & waste mgmt 3.052
All Other Services 2.451
Capital 10.310
Fixed 8.957
Moveable 1.353
Professional Liability Insurance 4.295
Medical Equipment 1.978
Medical supplies 1.760%

For most of these categories, we use the same method as finalized in the CY 2011 PFS final rule with comment period to estimate the cost shares. In particular, the cost shares for the following categories are derived directly from expense data reported on the 2006 AMA PPIS: PLI; Medical Equipment; and Medical Supplies. In each case, the cost shares remain the same as in the current MEI. Additionally, we continue to use the Bureau of Economic Analysis (BEA) 2002-Benchmark I/O data aged to 2006 to determine the cost weights for other expenses not collected directly from the AMA PPIS. The BEA 2002-Benchmark I/O data can be accessed at the following link: http://www.bea.gov/industry/io_benchmark.htm#2002data

The derivation of the cost weight for each of the detailed categories under Other Practice Expenses is provided in 78 FR 43315-43316. The following categories had no revisions proposed to the cost share weight and therefore reflect the same cost share weight as finalized in the CY 2011 final rule: Utilities, Telephone, Postage, Fixed Capital, Moveable Capital, PLI, Medical Equipment, and Medical Supplies. The following section provides a review of the categories for which we proposed revisions to the cost categories and cost share weights (Miscellaneous Office Expenses, and All Other Services).

• Miscellaneous Office Expenses : Based on MEI-TAP recommendation 3.4 we proposed to include an aggregate category of detailed office expenses that were stand-alone categories in the current 2006-based MEI. During the CY 2011 PFS proposed rule comment period, several commenters expressed confusion as to the relevance of these categories to their practice costs. The MEI-TAP discussed the degree of granularity needed in both the calculation and reporting of the MEI. The MEI-TAP concluded that it might be prudent to collapse some of the non-labor PE categories with other categories for presentation purposes.

• All Other Professional Services : Based on MEI-TAP recommendation 3.3, we proposed to combine the All Other Services cost weight and All Other Professional Expenses into a single cost category. The proposed weight for the All Other Professional Services category is 8.095 percent, which is the sum of the current MEI weight for All Other Services (3.581 percent) and All Other Professional Expenses (4.513 percent), and is more in line with the GPCI Purchased Services index as finalized in the CY2012 PFS final rule with comment period (76 FR 73085).—

We then proposed to further disaggregate the 8.095 percent of expenses into more detail based on the BEA I-O data, allowing for specific cost weights for services such as contract billing services, accounting, and legal services. We considered various levels of aggregation; however, in considering the level of aggregation, the available corresponding price proxies had to be considered. Given the price proxies that are available from the BLS Employment Cost Indexes (ECI), we proposed to disaggregate these expenses into three categories:

  • NAICS 54 (Professional, Scientific, and Technical Services): The Professional, Scientific, and Technical Services sector comprises establishments that specialize in performing professional, scientific, and technical activities for others. These activities require a high degree of expertise and training. The establishments in this sector specialize according to expertise and provide these services to clients in a variety of industries, including but not limited to: legal advice and representation; accounting, and payroll services; computer services; management consulting services; and advertising services and have a 2.592 percent weight.
  • NAICS 56 (Administrative and Support and Waste Management and Remediation Services): The Administrative and Support and Waste Management and Remediation Services sector comprises establishments performing routine support activities for the day-to-day operations of other organizations. The establishments in this sector specialize in one or more of these support activities and provide these services to clients in a variety of industries including but not limited to: office administration; temporary help services; security services; cleaning and janitorial services; and trash collection services. These services have a 3.052 percent weight.
  • All Other Services, a residual category of these expenses: The residual All Other Services cost category is mostly comprised of expenses associated with service occupations, including but not limited to: lab and blood specimen transport; catering and food services; collection company services; and dry cleaning services and have a 2.451 percent weight.

2. Selection of Price Proxies for Use in the MEI

After developing the cost category weights for the revised 2006-based MEI, we reviewed all the price proxies based on the recommendations from the MEI-TAP. As was the case in the development of the current 2006-based MEI, most of the proxy measures we considered are based on BLS data and are grouped into one of the following four categories:

• Producer Price Indices (PPIs): PPIs measure price changes for goods sold in markets other than retail markets. These fixed-weight indexes are measures of price change at the intermediate or final stage of production. They are the preferred proxies for physician purchases as these prices appropriately reflect the product's first commercial transaction.

• Consumer Price Indices (CPIs): CPIs measure change in the prices of final goods and services bought by consumers. Like the PPIs, they are fixed weight indexes. Since they may not represent the price changes faced by producers, CPIs are used if there are no appropriate PPIs or if the particular expenditure category is likely to contain purchases made at the final point of sale.

• Employment Cost Indices (ECIs) for Wages & Salaries: These ECIs measure the rate of change in employee wage rates per hour worked. These fixed-weight indexes are not affected by employment shifts among industries or occupations and thus, measure only the pure rate of change in wages.

• Employment Cost Indices (ECIs) for Employee Benefits: These ECIs measure the rate of change in employer costs of employee benefits, such as the employer's share of Social Security taxes, pension and other retirement plans, insurance benefits (life, health, disability, and accident), and paid leave. Like ECIs for wages & salaries, the ECIs for employee benefits are not affected by employment shifts among industries or occupations.

When choosing wage and price proxies for each expense category, we evaluate the strengths and weaknesses of each proxy variable using the following four criteria.

• Relevance: The price proxy should appropriately represent price changes for specific goods or services within the expense category. Relevance may encompass judgments about relative efficiency of the market generating the price and wage increases.

• Reliability: If the potential proxy demonstrates a high sampling variability, or inexplicable erratic patterns over time, its viability as an appropriate price proxy is greatly diminished. Notably, low sampling variability can conflict with relevance—since the more specifically a price variable is defined (in terms of service, commodity, or geographic area), the higher the possibility of high sampling variability. A well-established time series is also preferred.

• Timeliness of actual published data: For greater granularity and the need to be as timely as possible, we prefer monthly and quarterly data to annual data.

• Public availability: For transparency, we prefer to use data sources that are publicly available.

The price proxy selection for every category in the proposed revised MEI is detailed in 78 FR 43316-43319. Below we discuss the price and wage proxies for each cost category in the proposed revised MEI.

a. Physician Compensation (Physician's Own Time)

(1) Physician Wages and Salaries

Based on recommendations from the MEI-TAP, we proposed to use the ECI for Wages and Salaries for Professional and Related Occupations (Private Industry) (BLS series code CIU2020000120000I) to measure price growth of this category in the revised 2006-based MEI. The current 2006-based MEI used Average Hourly Earnings (AHE) for Production and Non-Supervisory Employees for the Private Nonfarm Economy.

The MEI-TAP had two recommendations concerning the price proxy for physician Wages and Salaries. The first recommendation from the MEI-TAP was Recommendation 4.1, which stated that: “. . . OACT revise the price proxy associated with Physician Wages and Salaries from an Average Hourly Earnings concept to an Employment Cost Index concept.” AHEs are calculated by dividing gross payrolls for wages and salaries by total hours. The AHE proxy was representative of actual changes in hourly earnings for the nonfarm business economy, including shifts in employment mix. The recommended alternative, the ECI concept, measures the rate of change in employee wage rates per hour worked. ECIs measure the pure rate of change in wages by industry and/or occupation and are not affected by shifts in employment mix across industries and occupations. The MEI-TAP believed that the ECI concept better reflected physician wage trends compared to the AHE concept.

The second recommendation related to the price proxy for physician wages and salaries was Recommendation 4.2, which stated that:

“CMS revise the price proxy associated with changes in Physician Wages and Salaries to use the Employment Cost Index for Wages and Salaries, Professional and Related, Private Industry. The Panel believes this change would maintain consistency with the guidance provided in the 1972 Senate Finance Committee report titled `Social Security Amendments of 1972,' which stated that the index should reflect changes in practice expenses and `general earnings.' In the event this change would be determined not to meet the legal requirement that the index reflect “general earnings,” the Panel recommended replacing the current proxy with the Employment Cost Index for Wages and Salaries, All Workers, Private Industry.” The Panel believed this change would maintain consistency with the guidance provided in the 1972 Senate Finance Committee report titled “Social Security Amendments of 1972,” which stated that the index should reflect changes in practice expenses and “general earnings.”2

We agree that switching the proxy to the ECI for Wages and Salaries for Professional and Related Occupations would be consistent with the authority provided in the statute and reflect a wage trend more consistent with other professionals that receive advanced training. Additionally, we believe the ECI is a more appropriate concept than the AHE because it can isolate wage trends without being impacted by the change in the mix of employment.

(2) Physician Benefits

The MEI-TAP states in Recommendation 4.3 that, “. . . any change in the price proxy for Physician Wages and Salaries be accompanied by the selection and incorporation of a Physician Benefits price proxy that is consistent with the Physician Wages and Salaries price proxy.” We proposed to use the ECI for Benefits for Professional and Related Occupations (Private Industry) to measure price growth of this category in the revised 2006-based MEI. The ECI for Benefits for Professional and Related Occupations is derived using BLS's Total Compensation for Professional and Related Occupations (BLS series ID CIU2010000120000I) and the relative importance of wages and salaries within total compensation. We believe this series is technically appropriate because it better reflects the benefit trends for professionals requiring advanced training. The current 2006-based MEI market basket used the ECI for Total Benefits for the Total Private Industry.

b. Practice Expense

(1) Non-Physician Employee Compensation

(a) Non-Physician Wages and Salaries

(i) Non-Physician, Non-Health-Related Wages and Salaries

  • Professional and Related: We proposed to continue using the ECI for Wages and Salaries for Professional and Related Occupation (Private Industry) (BLS series code CIU2020000120000I) to measure the price growth of this cost category.
  • Management: We proposed to continue using the ECI for Wages and Salaries for Management, Business, and Financial (Private Industry) (BLS series code CIU2020000110000I) to measure the price growth of this cost category.
  • Clerical: We proposed to continue using the ECI for Wages and Salaries for Office and Administrative Support (Private Industry) (BLS series code CIU2020000220000I) to measure the price growth of this cost category. This is the same proxy used in the current 2006-based MEI.
  • Services: We proposed to continue using the ECI for Wages and Salaries for Service Occupations (Private Industry) (BLS series code CIU2020000300000I) to measure the price growth of this cost category.

(ii) Non-Physician, Health-Related Wages and Salaries

In Recommendation 4.4, the MEI-TAP “. . . recommend[ed] the disaggregation of the Non-Physician Compensation costs to include an additional category for health-related workers. This disaggregation would allow for health-related workers to be separated from non-health-related workers. CMS should rely directly on PPIS data to estimate the health-related non-physician compensation cost weights. The non-health, non-physician wages should be further disaggregated based on the Current Population Survey and Occupational Employment Statistics data. The new health-related cost category should be proxied by the ECI, Wages and Salaries, Hospital (NAICS 622), which has an occupational mix that is reasonably close to that in physicians' offices. The Non-Physician Benefit category should be proxied by a composite benefit index reflecting the same relative occupation weights as the non-physician wages.” We proposed to use the ECI for Wages and Salaries for Hospital Workers (Private Industry) (BLS series code CIU2026220000000I) to measure the price growth of this cost category in the final revised 2006-based MEI. The ECI for Hospital workers has an occupational mix that approximates that in physicians' offices. This cost category was not broken out separately in the current 2006-based MEI.

(b) Non-Physician Benefits

We proposed to continue using a composite ECI for non-physician employee benefits in the revised 2006-based MEI. However, we also proposed to expand the number of occupations from four to five by adding detail on Non-Physician Health-Related Benefits. The weights and price proxies for the composite benefits index will be revised to reflect the addition of the new category. Table 18 lists the five ECI series and corresponding weights used to construct the revised composite benefit index for non-physician employees in the revised 2006-based MEI.

Table 18—CMS Composite Price Index for Non-Physician Employee Benefits in the Revised 2006-Based MEI Back to Top
ECI Series 2006 Weight (%)
Benefits for Professional and Related Occupation (Private Industry) 7
Benefits for Management, Business, and Financial (Private Industry) 12
Benefits for Office and Administrative Support (Private Industry) 40
Benefits for Service Occupations (Private Industry) 2
Benefits for Hospital Workers (Private Industry) 39

(3) Other Practice Expense

(a) All Other Professional Services

As discussed previously, MEI-TAP Recommendation 3.3 was that:

“. . . OACT create a new cost category entitled Professional Services that should consist of the All Other Services cost category (and its respective weight) and the Other Professional Expenses cost category (and its respective weight). The Panel further recommends that this category be disaggregated into appropriate occupational categories consistent with the relevant price proxies.” We are proposed to implement this recommendation in the revised 2006-based MEI using a cost category titled “All Other Professional Services.” Likewise, the MEI-TAP stated in Recommendation 4.7 that “. . . price changes associated with the Professional Services category be proxied by an appropriate blend of Employment Cost Indexes that reflect the types of professional services purchased by physician offices.” We agree with this recommendation and proposed to use the following price proxies for each of the new occupational categories:

  • Professional, Scientific, and Technical Services: We proposed to use the ECI for Total Compensation for Professional, Scientific, and Technical Services (Private Industry) (BLS series code CIU2015400000000I) to measure the price growth of this cost category. This cost category was not broken out separately in the current 2006-based MEI.
  • Administrative and Support Services: We proposed to use the ECI for Total Compensation for Administrative, Support, Waste Management, and Remediation Services (Private Industry) (BLS series code CIU2015600000000I) to measure the price growth of this cost category. This cost category was not broken out separately in the current 2006-based MEI.
  • All Other Services: We proposed to use the ECI for Compensation for Service Occupations (Private Industry) (BLS series code CIU2010000300000I) to measure the price growth of this cost category.

(b) Miscellaneous Office Expenses

  • Chemicals: We proposed to continue using the PPI for Other Basic Organic Chemical Manufacturing (BLS series code #PCU32519-32519) to measure the price growth of this cost category.
  • Paper: We proposed to continue using the PPI for Converted Paper and Paperboard (BLS series code #WPU0915) to measure the price growth of this cost category.
  • Rubber & Plastics: We proposed to continue using the PPI for Rubber and Plastic Products (BLS series code #WPU07) to measure the price growth of this cost category.
  • All Other Products: We proposed to continue using the CPI-U for All Products less Food and Energy (BLS series code CUUR0000SA0L1E) to measure the price growth of this cost category.
  • Utilities: We proposed to continue using the CPI for Fuel and Utilities (BLS series code CUUR0000SAH2) to measure the price growth of this cost category.
  • Telephone: We proposed to continue using the CPI for Telephone Services (BLS series code CUUR0000SEED) to measure the price growth of this cost category.
  • Postage: We proposed to continue using the CPI for Postage (BLS series code CUUR0000SEEC01) to measure the price growth of this cost category.
  • Fixed Capital: In Recommendation 4.5, “The Panel recommends using the Producer Price Index for Lessors of Nonresidential Buildings (NAICS 53112) for the MEI Fixed Capital cost category as it represents the types of fixed capital expenses most likely faced by physicians. The MEI-TAP noted the volatility in the index, which is greater than the Consumer Price Index for Owners' Equivalent Rent of Residences. This relative volatility merits ongoing monitoring and evaluation of alternatives.” We are proposed to use the PPI for Lessors of Nonresidential Buildings (BLS series code PCU531120531120) to measure the price growth of this cost category in the revised 2006-based MEI. The current 2006-based MEI used the CPI for Owner's Equivalent Rent. We believe the PPI for Lessors of Nonresidential Buildings is more appropriate as fixed capital expenses in physician offices should be more congruent with trends in business office space costs than residential costs.
  • Moveable Capital: In Recommendation 4.6, the MEI-TAP states that “. . . CMS conduct research into and identify a more appropriate price proxy for Moveable Capital expenses. In particular, the MEI-TAP believes it is important that a proxy reflect price changes in the types of non-medical equipment purchased in the production of physicians' services, as well as the price changes associated with Information and Communication Technology expenses (including both hardware and software).” We intend to continue to investigate possible data sources that could be used to proxy the physician expenses related to moveable capital in more detail. However, we proposed to continue using the PPI for Machinery and Equipment (series code WPU11) to measure the price growth of this cost category in the revised 2006-based MEI.
  • Professional Liability Insurance: Unlike the other price proxies based on data from BLS and other public sources, the proxy for PLI is based on data collected directly by CMS from a sample of commercial insurance carriers. The MEI-TAP discussed the methodology of the CMS PLI index, as well as considered alternative data sources for the PLI price proxy, including information available from BLS and through state insurance commissioners. MEI-TAP Finding 4.3 states:

“The Panel finds the CMS-constructed professional liability insurance price index used to proxy changes in professional liability insurance premiums in the MEI represents the best currently available method for its intended purpose. The Panel also believes the pricing patterns of commercial carriers, as measured by the CMS PLI index, are influenced by the same driving forces as those observable in policies underwritten by physician-owned insurance entities; thus, the Panel believes the current index appropriately reflects the price changes in premiums throughout the industry.” Given this MEI-TAP finding, we proposed to continue using the CMS Physician PLI index to measure the price growth of this cost category in the revised 2006-based MEI.

  • Medical Equipment: We proposed to continue using the PPI for Medical Instruments and Equipment (BLS series code WPU1562) as the price proxy for this category.
  • Medical Materials and Supplies: We proposed to continue using a blended index comprised of a 50/50 blend of the PPI for Surgical Appliances (BLS series code WPU156301) and the CPI-U for Medical Equipment and Supplies (BLS series code CUUR0000SEMG).
Table 19—Revised 2006-Based MEI Cost Categories, Weights, and Price Proxies Back to Top
Cost category 2006 weight (percent) Price proxy
Total MEI 100.000
Physician Compensation 50.866
Wages and Salaries 43.641 ECI—Wages and salaries—Professional and Related (Private).
Benefits 7.225 ECI—Benefits—Professional and Related (Private).
Practice Expense 49.134
Non-physician Compensation 16.553
Non-physician Wages 11.885
Non-health, non-physician wages 7.249
Professional and Related 0.800 ECI—Wages And Salaries—Professional and Related (Private).
Management 1.529 ECI—Wages And Salaries—Management, Business, and Financial (Private).
Clerical 4.720 ECI—Wages And Salaries—Office and Admin. Support (Private).
Services 0.200 ECI—Wages And Salaries—Service Occupations (Private).
Health related, non-phys. Wages 4.636 ECI—Wages and Salaries—Hospital (Private).
Non-physician Benefits 4.668 Composite Benefit Index.
Other Practice Expense 32.581
Miscellaneous Office Expenses 2.478
Chemicals 0.723 PPI—Other Basic Organic Chemical Manufacturing.
Paper 0.656 PPI—Converted Paper and Paperboard.
Rubber and Plastics 0.598 PPI—Rubber and Plastic Products.
All other products 0.500 CPI—All Items Less Food And Energy.
Telephone 1.501 CPI—Telephone.
Postage 0.898 CPI—Postage.
All Other Professional Services 8.095
Prof., Scientific, and Tech. Svcs 2.592 ECI—Compensation—Prof., Scientific, and Technical (Private).
Admin. and Support Services 3.052 ECI—Compensation—Admin., Support, Waste Management (Private).
All Other Services 2.451 ECI—Compensation—Service Occupations (Private).
Capital
Fixed Capital 8.957 PPI—Lessors of Nonresidential Buildings.
Moveable Capital 1.353 PPI—Machinery and Equipment.
Professional Liability Insurance 4.295 CMS—Professional Liability Phys. Prem. Survey.
Medical Equipment 1.978 PPI—Medical Instruments and Equipment.
Medical Supplies 1.760 Composite—PPI Surgical Appliances & CPI-U Medical Supplies.

3. Productivity Adjustment to the MEI

The MEI has been adjusted for changes in productivity since its inception. In the CY 2003 PFS final rule with comment period (67 FR 80019), we implemented a change in the way the MEI was adjusted to account for changes in productivity. The MEI used for the 2003 physician payment update incorporated changes in the 10-year moving average of private nonfarm business (economy-wide) multifactor productivity that were applied to the entire index. Previously, the index incorporated changes in productivity by adjusting the labor portions of the index by the 10-year moving average of economy-wide private nonfarm business labor productivity.

The MEI-TAP was asked to review this approach. In Finding 5.1, “[t]he Panel reviewed the basis for the current economy-wide multifactor productivity adjustment (Private Nonfarm Business Multifactor Productivity) in the MEI and finds such an adjustment continues to be appropriate. This adjustment prevents `double counting' of the effects of productivity improvements, which would otherwise be reflected in both (i) the increase in compensation and other input price proxies underlying the MEI, and (ii) the growth in the number of physician services performed per unit of input resources, which results from advances in productivity by individual physician practices.”

Based on the MEI-TAP's finding, we proposed to continue to use the current method for adjusting the full MEI for multifactor productivity in the revised 2006-based MEI. As described in the CY 2003 PFS final rule with comment period, we believe this adjustment is appropriate because it explicitly reflects the productivity gains associated with all inputs (both labor and non-labor). We believe that using the 10-year moving average percent change in economy-wide multifactor productivity is appropriate for deriving a stable measure that helps alleviate the influence that the peak (or a trough) of a business cycle may have on the measure. The adjustment will be based on the latest available historical economy-wide nonfarm business multifactor productivity data as measured and published by BLS.

4. Results of Revisions on the MEI Update

Table 20 shows the average calendar year percent change from CY 2005 to CY 2013 for both the revised 2006-based MEI and the current 2006-based MEI, both excluding the productivity adjustment. The average annual percent change in the revised 2006-based MEI is 0.1 percent lower than the current 2006-based MEI over the 2005-2013 period. On an annual basis over this period, the differences vary by up to plus or minus 0.7 percentage point. In the two most recent years (CY 2012 and CY 2013), the annual percent change in the revised 2006-based MEI was within 0.1 percentage point of the percent change in the current 2006-based MEI. The majority of these differences over the historical period can be attributed to the revised price proxy for physician wages and salaries and benefits and the revised price proxy for fixed capital.

Table 20—Annual Percent Change in the Revised 2006-Based MEI, Not Including Productivity Adjustment and the Current 2006-Based MEI, Not Including Productivity Adjustment * Back to Top
Update year Revised 2006-based MEI excl. MFP Current 2006-based MEI, excl. MFP
* Update year based on historical data through the second quarter of the prior calendar year. For example, the 2014 update is based on historical data through the second quarter 2013, prior to the MFP adjustment.
CY 2005 3.8 3.1
CY 2006 4.0 3.3
CY 2007 3.2 3.2
CY 2008 3.2 3.4
CY 2009 2.9 3.1
CY 2010 2.4 2.8
CY 2011 0.9 1.6
CY 2012 1.7 1.8
CY 2013 1.7 1.8
Avg. Change for CYs 2005-2013 2.6 2.7

5. Summary of Comments and the Associated Responses

Comment: Many commenters appreciate the efforts of CMS to implement the recommendations of the MEI-TAP. They agree with the MEI-TAP's analysis and recommendations and believe these changes successfully bring the “market basket” of MEI inputs up to date and improve the accuracy of the index going forward. Nearly all commenters supported the following proposals:

  • The increase in the physician benefits cost weight in order to ensure consistency with the benefits price proxy.
  • The use of professional workers' earnings as the price proxy for the physician compensation portion of the index. Specifically, the price proxies for physician wages would change from general economy-wide earnings to a wages index for “Professional and related occupations” and the price proxy for physician benefits would be changed from general economy-wide benefits to a benefit index for “Professional and related occupations.”
  • The use of commercial rent data for the fixed capital price proxy, replacing the CPI residential rent proxy.
  • The creation of a health sector wage category within the index.
  • The creation of an “all other professional services” category, encompassing purchased services such as contract billing, legal, and accounting services.

Response: We agree with the commenters that implementing the TAP recommendations identified above improve the accuracy of the index.

Comment: Several commenters concur with the proposal to reclassify expenses for non-physician clinical personnel that can bill independently from non-physician compensation to physician compensation. They agree with the proposal based on the reasons CMS outlines and because this policy is more consistent with how services by non-physician practitioners are treated in the resource-based relative value scale (RBRVS).

Response: We appreciate the commenters support for the decision to reclassify expenses related to non-physician clinical personnel that can bill independently from non-physician compensation to physician compensation. We also agree with the commenter that classifying the expenses with physician compensation is more consistent with how services by non-physician practitioners are treated in the RBRVS since services related to direct patient care from non-physician practitioners are reported with the work component in the RBRVS methodology. We also believe that non-physician practitioners will continue to perform services that are direct substitutes for services furnished by physicians, such as office visits.

Comment: Many commenters believe that it is not technically appropriate to reclassify all expenses for non-physician clinical personnel that can bill independently from non-physician compensation to physician compensation. They note that the MEI-TAP recommended that the OACT consider “the extent to which those who can bill independently actually do so.” They also note that non-physician clinical personnel often spend much of their time on activities other than providing services that are billed independently. They suggested that only the portion of the time the non-physician clinical personnel spend providing services that are billed independently should be reclassified to physician compensation. They believe that the increase in the physician compensation cost share by 2.600 percentage points, and the reduction in non-physician compensation by the same amount, is too high. The commenters encourage CMS to conduct real analysis of the time spent on activities that are billed independently prior to implementing this re-allocation of costs.

Response: We understand that non-physician clinical personnel may spend some of their time on activities other than providing services that are billed independently. We would note that physicians also spend some of their time on work that is not direct patient care. We proposed to only reclassify the expenses related to the non-physician clinical personnel that can bill independently; that is, we are not reclassifying the expenses for non-physician clinical personnel that cannot bill independently. We believe that the increase in physician compensation is technically correct.

The commenters suggested that the non-physician clinical staff that can bill independently spend much of their time on activities other than providing services that are billed separately; however, the commenters did not provide any evidence to support this claim. Based on part B claims data we have found that nurse practitioners and physician assistants bill Medicare for the same top HCPCS codes as other primary care specialties, including office/outpatient visits, subsequent hospital care, emergency department visits, and nursing facility care subsequent visits. Based on this, we do not believe further analysis is needed to conclude that the non-physician practitioners that can bill independently are furnishing services that are substitutes for services furnished by physicians. As such, we continue to believe that it is appropriate to classify their costs in the physician compensation category.

Comment: A few commenters suggested that multiple states preclude non-physicians from practicing and billing independently and therefore the reclassification of expenses for these services would affect those states differently than the states where non-physician practitioners are allowed to practice and bill independently.

Response: We understand that state laws governing the practice rules for non-physician practitioners can vary by State; however, we do not believe that this is relevant to the decision to include in the physician compensation cost category the expenses for non-physician practitioners that can independently bill under Medicare. These expenses were collected on the AMA PPIS where we expect that physicians would have reported the expenses that coincided with the state laws for non-physician clinical staff for the state in which they practiced. For a state in which the laws do not permit non-physician practitioners to bill independently, the expenses would have been allocated to the category for clinical staff that cannot bill independently.

Comment: Several commenters questioned the implementation of the MEI-TAP recommendation concerning payroll for non-physician personnel. The commenters stated that the recommendation was more nuanced than we had conveyed and that it only directed CMS to evaluate making the change. The commenters suggested that the recommendation required CMS to consider several factors including but not limited to, the statutory definition of “physician” as it relates to the recommended change; how time for non-physician practitioners is currently treated in the PFS RVU methodology; whether there is evidence these non-physician practitioners do not spend the majority of their time providing “physicians' services;” and the extent to which these practitioners actually do bill independently for the services they furnish.

Response: When evaluating the MEI-TAP recommendation 3.2 and formulating our proposal, we did consider the specific factors that the MEI-TAP included in the recommendation to reclassify the expenses related to non-physician clinical staff that can bill Medicare independently. However, we disagree with the commenters' interpretation that the recommendation intended CMS to only evaluate making the change. We believe that the intent of all of the recommendations of the MEI-TAP was for CMS to evaluate the recommendations and propose and implement those changes as soon as possible.

As we indicated in the proposed rule, there are several reasons for our proposal to reclassify these expenses which were: (1) These types of practitioners furnish services that are similar to those furnished by physicians; (2) if billing independently, these practitioners would be paid at a percentage of the physicians' services or in certain cases at the same rate as physicians; and (3) the expenses related to the work components for the RVUs would include work from clinical staff that can bill independently. Therefore, it would improve consistency with the RVU payments to include these expenses as physician compensation in the MEI.

In response to this comment, we explain further our consideration of each of the factors as follows:

First, we do not believe the definition of physician under current law limits CMS' ability to make the proposed change in the MEI. No provisions of the Social Security Act address the classification of costs in the MEI. The goal of the MEI is to appropriately estimate the change in the input prices of the goods and services used to furnish physician services over time. Therefore, we believe that classifying costs for those non-physician practitioners that can bill independently with physician compensation is the most technically appropriate classification, given their role in the healthcare delivery system today. We believe that since non-physician practitioners (NPPs) who bill independently furnish services that substitute for physician work and that the salary costs for these types of providers would grow at a similar rate to those of physicians, it is appropriate to classify these expenses within the physician compensation component of the MEI.

Second, the expenses for non-physician practitioners that can independently bill are reflected in the physician work component in the PFS RVU methodology since their services are substituting for physician work. Expenses for other clinical staff, including RNs, LPNs, physicists, lab technicians, x-ray technicians, medical assistants, and other clinical personnel who cannot independently bill are reported in the PE component in the RVU methodology.

Third, we have found no evidence that these types of providers do not spend the majority of their time performing “physicians' services,” as defined under the PFS. We looked at 2012 claims data for the nurse practitioners (NPs) (specialty code 50) and physician assistants (PAs) (specialty code 97) and compared their top Part B HCPCS codes reported on claims to the top Part B HCPCS codes reported on claims of the following three physician specialties: General Practice (specialty code 01), Family Practice (specialty code 08), and Internal Medicine (specialty code 11). We found that 7 out of the 10 top HCPCS codes for PAs and NPs are the same as those reported for physicians in General Practice, Family Practice, and/or Internal Medicine. HCPCS code 99213 and 99214 (both codes for office/outpatient visits) were the top two HCPCS codes for all five specialties listed. Approximately 40 percent of claims for PAs and 50 percent of claims for NPs were for HCPCS codes that were also submitted by one of the three primary care specialties (general practice, family practice, and internal medicine). Based on this Medicare claims analysis, we believe that these types of non-physician practitioners do spend the majority of their time performing “physicians' services.”

Fourth, we believe that non-physician practitioners who are able to bill independently actually do so in the majority of circumstances where it is financially beneficial for the practice as a whole. We understand that different states may have different rules on how non-physician practitioners are permitted to furnish physician services; but, in general, if the non-physician practitioner can independently bill, particularly if the reimbursement for the service is similar to or the same as that provided to a physician, they usually do so. We reviewed data on mean annual wages published in the May 2012 Occupational Employment Survey (OES) (http://www.bls.gov/oes/current/oes_stru.htm), and found that wages for PAs and NPs are significantly higher than RNs and LPNs/LVNs. Specifically, the mean annual wages for OES Category 29-1071 “Physician Assistants” is $92,460 and for OES Category 29-1171 “Nurse Practitioners” it is $91,450 whereas for OES Category 29-1141 “Registered Nurses” it is $67,930 and for OES Category 29-2061 “Licensed Practical and Licensed Vocational Nurses” it is $42,400. In addition, wages for PAs and NPs are also significantly higher than technologist and technician wages. Select technologist and technician wages are OES Category 29-2051 “Dietetic Technicians” at $28,680, OES Category 29-2052 “Pharmacy Technicians” at $30,430, OES Category 29-2053 “Psychiatric Technicians” at $33,140, OES Category 29-2054 “Respiratory Therapy Technicians” $47,510, and OES Category 29-2055 “Surgical Technologists” at $43,480. Given the significantly higher wages for PAs and NPs, we believe it makes economic sense for PAs and NPs to furnish and bill for “physicians' services” to the extent permitted by law rather than to serve as clinical staff members who only furnish services incident to a physician's services.

Comment: One commenter believes that the MEI is intended to be a reflection of physician compensation and physician expenses, and that it must conform to the definitions of “physician” and “physicians' services,” which includes affirmation of the distinct definitions of physician and nurse practitioner. The commenter claims the reasons for our proposal fail to account for this foundational distinction between physicians and “physicians' services” as opposed to other types of practitioners and their services. The commenter believes that to lump the two definitions together, which is what we are doing, is not justifiable and in excess of authority.

Response: We disagree with the commenter that classifying the non-physician independent billers' expenses in the same category as the physician expenses “is not justifiable and in excess of authority.” The definition of physician that exists under current law does not limit CMS' ability to make this change in the MEI. As mentioned previously, no provisions of the Social Security Act address the classification of costs in the MEI. We believe that since non-physician practitioners that bill independently serve as substitutes for physician work, and the growth in the salary costs for these types of providers would grow at a similar rate to physicians, then classifying the expenses related to non-physician practitioners that bill independently with physician compensation is the most technically appropriate classification, given their role in the healthcare delivery system today.

Comment: It is unclear to several commenters why the productivity assumptions for physicians are twice that used for the hospital outpatient department and ambulatory surgery centers. Although they understood that these are two different calculations, they found it hard to imagine that individual physicians would have twice the capability of increasing productivity than would facilities. They note that all of the productivity adjustments should be based on 10-year averages of private non-farm business multifactor productivity growth, but the OPPS and ASC adjustments, are about half the MEI adjustment for CY 2014.

Response: The productivity adjustments included in the MEI and those that apply to ASCs and HOPDs are based on the 10-year moving average of economy-wide private nonfarm business multifactor productivity (MFP). The differences in the MFP adjustments between the ASC and HOPD payment systems and the PFS are the result of differences between the applicable statutes and the time period for which the adjustment is calculated.

MEI updates have been based on the latest historical data at the time of rulemaking since its inception. For the CY 2014 rule, the proposed MEI update of 0.7 percent includes an MFP adjustment of 0.9 percent, which is based on BLS data through 2011 that represents the latest historical data available at the time of rulemaking. The proposed MFP adjustment is based on the 10-year moving average of annual MFP growth from 2002-2011; and we would note that the annual MFP growth over the 2002-2004 time period was historically high.

The ASC and HOPD MFP adjustments, on the other hand, are required by law to be based on forecasts for the appropriate payment period, in this case through CY 2014. The forecasts of the MFP are completed by IHS Global Insight, Inc. (IGI). Accordingly, the MFP adjustment applicable to ASCs and HOPDs is based on the 10-year moving average of annual MFP growth from 2005-2014. A complete description of the methodology used to calculate the MFP for the MEI can be found in the CY 2012 PFS final rule with comment period (76 FR 73300).

Comment: One commenter disagrees with CMS' assessment that there is not a reliable, ongoing source of data from which to index cost data. CMS is currently basing the MEI on 2006 data yet it accepted and has now fully transitioned the results of the Physician Practice Information Survey (PPIS) as of 2013. The data from PPIS was developed based on practice costs in 2008. They questioned why the data currently available would be any less reliable than was used the previous three times that CMS rebased the MEI. In fact, they claim that the PPIS data should be more reliable. The commenter acknowledges that data developed by the MGMA are derived primarily from large urban and suburban practices and do not adequately capture costs from small and solo practitioners who do not enjoy the same economies of scale and practice efficiencies afforded to larger groups. However, the commenter would support another updated survey of practice costs similar to PPIS that would also include any elements included within the MEI that were not previously captured. The commenter suggests that if the time and resources are going to go into such a study, the survey should include and be used to update all physician practice expenses.

Response: We believe the commenter misunderstood our statement. We do believe the AMA PPIS is a reliable data source; however, the PPIS is not an ongoing data source that is published regularly, such as the IPPS, SNF, and HHA cost reports. The 2006 AMA PPIS data were used to determine nine expenditure weights in the 2006-based MEI: physicians' earnings, physicians' benefits, employed physician payroll, non-physician compensation, office expenses, PLI, medical equipment, medical supplies, and other professional expenses. It continues to be the data source used in the CY 2014 proposed revisions to the MEI. At this time, the AMA is no longer conducting the PPIS survey.

We concur with the commenter's points regarding the issues pertaining to the MGMA data and also appreciate the commenter's support of conducting another practice cost survey similar to the PPIS. We will be looking into viable options for updating the MEI cost weights going forward.

Comment: Several commenters appreciated the efforts by CMS to convene the MEI-TAP, and urged the agency to continue work on the remaining issues the MEI-TAP identified including consideration of whether: (1) using self-employed physician data for the MEI cost weights continues to be the most appropriate approach; (2) additional data sources could allow more frequent updates to the MEI's cost categories and their respective weights; and (3) there is a more appropriate price proxy for Moveable Capital expenses. The commenter noted that CMS plans to continue to investigate these three issues and the commenter looks forward to working with CMS in that effort.

Response: We will continue to investigate possible options for the three remaining MEI-TAP recommendations as they require additional research regarding possible data sources. Any further changes to the MEI, in response to MEI-TAP recommendations, will be made through future notice and comment rulemaking.

Comment: One commenter noted that although the MEI-TAP recommended a number of data sources that could be considered to rebase the MEI, it was unable to identify a reliable, ongoing source of data to do so. The commenter recommended that CMS consider a sample cost reporting method rather than a survey similar to the American Medical Association's (AMA) Physician Practice Information Survey (PPIS) that took place between 2007 and 2008. The commenter noted that the PPIS was extraordinarily expensive for the AMA and was plagued by low response rates. In addition, the commenter noted that the disputed PPIS results led to significant payment reductions for cardiology. The commenter notes that CMS is already considering efforts to establish a cost report for provider-based clinics. The commenter suggests that this effort could be coupled with a sample of private practice clinics in order to better measure the MEI.

Response: We thank the commenter for the suggestion. We will be investigating possible data sources to use for the purpose of rebasing the MEI in the future. Our research will include the evaluation of multiple potential data sources including a sampling of clinics and/or physicians subject to agency resources. If reliable cost report data is collected for provider-based clinics in the future then we will analyze and consider its possible use at that time. We remind the commenter that any new study or survey we conduct would require approval through OMB's standard survey and auditing process (see “Standards and Guidelines for Statistical Surveys”http://www.whitehouse.gov/sites/default/files/omb/assets/omb/inforeg/statpolicy/standards_stat_surveys.pdf and “Guidance on Agency Survey and Statistical Information Collections”http://www.whitehouse.gov/sites/default/files/omb/assets/omb/inforeg/pmc_survey_guidance_2006.pdf).

Comment: One commenter strongly supports the continued monitoring of physician productivity growth as it compares to economy-wide growth. The commenter notes that medical practices have been subjected to a number of regulatory requirements in recent years that likely impacted their productivity. To ensure compliance with these regulatory requirements, physicians often must take actions that reduce practice productivity, including hiring additional office staff, retaining attorneys for legal and regulatory compliance, and contracting with accountants and billing companies to ensure proper processing of claims. Monitoring of physician productivity growth is necessary to determine if the continued use of economy-wide productivity growth in the MEI is appropriate.

Response: At the June 25, 2012 MEI-TAP meeting, we presented estimates of physician-specific productivity from 1983 to 2010. These estimates used a resource-based methodology similar to that used by Charles Fisher to estimate physician office productivity from 1983-2004 as published in the Winter 2007 Health Care Financing Review. The MEI-TAP had the following finding regarding the physician-specific productivity estimates:

Finding 5.2: The Panel finds the measures of growth in physician-specific productivity are of interest for the purpose of comparing the structure of price increases for physician services versus other sectors of the economy. The Panel does not recommend using a physician-specific measure, but does believe that continued monitoring is appropriate. Use of physician-specific productivity growth to adjust economy-wide compensation growth in the MEI could introduce inconsistencies in the calculation of the MEI that could distort the results. The Panel concludes it is appropriate to continue to require that the accounting identity between input price growth, output price growth, and the productivity adjustment be maintained (as is approximated by the current version of the index).

Per the MEI-TAP's recommendation, we will continue to monitor trends in physician productivity on a periodic basis and how those trends move relative to economy-wide productivity.

Comment: A few commenters noted that it will remain difficult for practicing clinicians to reconcile changes in the MEI with their own practice cost increases. The projected increase in the proposed MEI for 2014 is just 0.7 percent, but this amount has been reduced by economy-wide productivity growth of 0.9 percent. Excluding the productivity adjustment, inflation for medical practices is projected to be 1.6 percent for 2014. In addition, as is the case with any price index, this amount does not take into account any change in the quantity of inputs (for example, changes in the number of staff that practices employ).

Response: We believe the MEI is the most technically appropriate index available to measure the price growth of inputs involved in furnishing physician services. We agree that the updates of the MEI do not take into account any change in the quantity of inputs, since it is not a cost index. The MEI-TAP was asked to consider whether the index should continue to be a fixed-weight, Laspeyres-type index. The MEI-TAP concluded that there is not sufficient evidence that the proportions of costs represented by the index's inputs vary enough over short periods of time, nor was there a consistently updated data source available, to warrant or support a change from using the Laspeyres formulation.

Comment: One commenter believes that a driving flaw in the PE GPCI is the rent input and its weighting. The commenter indicates the proposed rule's CY 2014 cost share weight of 10.223 percent is not representative of the office rent cost share weights of other physicians. It is also not representative of what the MGMA's cost survey data seems to indicate is the national office rent cost weight.

Response: As stated in the proposed rule, the PE GPCI office rent portion (10.223 percent) includes the revised 2006-based MEI cost weights for fixed capital (reflecting the expenses for rent, depreciation on medical buildings and mortgage interest) and utilities. The methodology for determining the fixed capital cost weight (8.957 percent) and utilities cost weight (1.266) is described in the CY 2011 PFS final rule (75 FR 73265).

We believe the weights produced from the methodology are technically appropriate as it is based on the 2006 AMA PPIS data and other government data for NAICS 621A00 (Offices of physicians, dentists, and other health practitioners). We realize that although individual practice experience may vary, the MEI cost shares must reflect the cost structure of the average physician office.

Comment: One commenter supported the AMA's call for MEI recognition of the cost/staffing implications of ever-increasing private and governmental regulations upon medical practices.

Response: We believe the commenter is expressing that during the course of our future research into alternative data sources on physician expenses that we should try to find a data source that would measure the increased costs that regulations compliance imposes on physicians practice expenses (for example, additional staffing or costs associated with moving to more technically advanced record-keeping such as electronic health records (EHRs)). If we are able to identify an appropriate data source for physician expenses that is updated and published on a regular basis, then the associated costs will be reflected in the relative shares of the various cost categories. In order to determine cost shares for a year later than 2006 we would need an alternative data source that is reliable, representative, and collected on a more consistent, regular basis.

Comment: One commenter claimed that the BEA Input-Output (I-O) tables categorize cost components differently than do medical practices; that CMS' actuarial conclusions are difficult to follow; and the industry wide I-O tables do not appear to comport with MGMA cost survey findings for medical practices. The commenter also stated that BEA I-O tables seem more focused on and designed to address how the offices of healthcare professionals utilize products in various national industries for purposes of assessing the productivity of those industries rather than to measure cost components of a medical practice. In that regard, the commenter asserts that the use of the I-O tables in developing GPCI cost share weights seems not to be an apples-to-apples relationship.

Response: We disagree with the commenter's claim that the BEA I-O tables are only to be used for purposes of assessing productivity of those industries rather than to measure cost components. As stated on the BEA Web site (http://www.bea.gov/scb/pdf/2007/10%20October/1007_benchmark_io.pdf), the BEA I-O data are based on the highest quality source data available. They provide an accurate and comprehensive picture of the inner workings of the economy, showing relationships among more than 400 industries and commodities. They facilitate the study of economic activity by providing a highly-detailed look at inter-industry activity. They also provide the detail that is essential in determining the quantity weights for price indexes such as the producer price index that is compiled by the Bureau of Labor Statistics (BLS). Therefore, our use of the BEA I-O data to derive the detailed cost weights for the MEI (and by extension the GPCI weights) is consistent with definition of and uses of the I-O data, as stated by BEA.

We would also note that CMS' examination of the MGMA cost data requested by the MEI-TAP found that the data: (1) reflected only group practice data (practices with greater than three physicians) rather than data for self-employed physician practices; (2) reflected more IDS and hospital-owned practices than physician-owned practices; (3) are not geographically representative; they are underrepresented in high-cost areas (NY, NJ, CA) and overrepresented in lower cost areas, such as the southern U.S.; and (4) are skewed toward primary care specialties relative to the universe of physician specialties. Additionally, the MGMA data are not publicly available. The BEA I-O data, on the other hand are based on detailed data from the quinquennial economic censuses that are conducted by the Bureau of the Census and show how industries interact at the detailed level; specifically, they show how approximately 500 industries provide input to, and use output from, each other to produce gross domestic product. The data we used in the construction of the MEI are representative of the entire broader industry as defined by NAICS 621A00, Offices of Physicians, Dentists and Other Health Professionals; and therefore we believe it is the most technically appropriate data source available to use to further disaggregate practice expenses within the MEI.

Comment: One commenter is concerned with CMS' proposal to use the Employment Cost Index (ECI) for Wages and Salaries for Hospital Workers (Private Industry) as a price proxy for Non-physician, Health-related staff compensation. The commenter does not agree with CMS' reasoning that the ECI for Hospital Workers has an occupational mix that is reasonably close to the occupational mix in physicians' offices. The commenter stated that they do not currently have an alternative price proxy suggestion.

Response: The purpose of the disaggregation of the Non-Physician Compensation costs to include an additional category for health-related workers was to be able to more accurately reflect the price inflation associated with these workers. There are limited health-related ECIs available. During the MEI-TAP discussions on July 11, 2012, this limitation was discussed (http://www.cms.gov/Regulations-and-Guidance/Guidance/FACA/MEITAP.html).

We continue to believe that the ECI for Wages and Salaries for Hospital Workers (Private Industry) is the most technically appropriate proxy for the compensation price inflation faced by non-physician, health related staff in physician offices as this ECI reflects the highest proportion of health-related staff (as measured by the Occupational Employment Statistics data) compared to other ECIs. Should the commenter have alternative price proxy suggestions, we will consider them in future rulemaking.

Comment: Several commenters agree with the proposed change in the price proxy for Fixed Capital, since it represents the types of fixed capital expenses most likely faced by physicians.

Response: We agree with the commenters that the price proxy proposed for Fixed Capital is more representative of the types of fixed capital expenses faced by physicians.

6. Final CY 2014 Revisions to the MEI

In general, most commenters supported all of the proposed changes to the index. The one area where there was concern from commenters was with the proposal to reclassify expenses for non-physician practitioners that can independently bill from non-physician compensation to physician compensation. Based on the public comments, we did not find any reason to reconsider our proposal, nor did we find any compelling technical reason that we should not implement this revision to the MEI. Therefore, we are finalizing our proposal to reclassify these expenses from non-physician compensation to physician compensation in the MEI. The effect of moving the expenses related to clinical staff that can bill independently to physician compensation category is to increase the physician compensation cost share by 2.600 percentage points and reduce non-physician compensation costs by the same amount. The revisions we are finalizing include:

  • Reclassifying expenses for non-physician clinical personnel that can bill independently from non-physician compensation to physician compensation.
  • Revising the physician wage and benefit split so that the cost weights are more in line with the definitions of the price proxies used for each category.
  • Adding an additional subcategory under non-physician compensation for health-related workers.
  • Creating a new cost category called “All Other Professional Services” that includes expenses covered in the current MEI categories: “All Other Services” and “Other Professional Expenses.” And further disaggregating the “All Other Professional Services” category into appropriate occupational subcategories.
  • Creating an aggregate cost category called “Miscellaneous Office Expenses” that would include the expenses for “Rubber and Plastics,” “Chemicals,” “All Other Products,” and “Paper.”
  • Revising the price proxy for physician wages and salaries from the Average Hourly Earnings (AHE) for the Total Private Nonfarm Economy for Production and Nonsupervisory Workers to the ECI for Wages and Salaries, Professional and Related Occupations, Private Industry.
  • Revising the price proxy for physician benefits from the ECI for Benefits for the Total Private Industry to the ECI for Benefits, Professional and Related Occupations, Private Industry.
  • Using the ECI for Wages and Salaries and the ECI for Benefits of Hospital, Civilian workers (private industry) as the price proxies for the new category of non-physician health-related workers.
  • Using ECIs to proxy the Professional Services occupational subcategories that reflect the type of professional services purchased by physicians' offices.
  • Revising the price proxy for the fixed capital category from the CPI for Owners' Equivalent Rent of Residences to the PPI for Lessors of Nonresidential Buildings (NAICS 53112).

Table 21 shows the final revised 2006-based MEI update for CY 2014 PFS, which is an increase of 0.8 percent. The CY 2014 MEI update would be the same if using the current 2006-based MEI. This update is based on historical data through the second quarter of 2013.

Table 21—Annual Percent Change in the CY 2014 Revised 2006-Based MEI and the Current 2006-Based MEI * Back to Top
Update year Final revised 2006-based MEI Current 2006-based MEI
* Based on historical data through the 2nd quarter 2013.
CY 2014 0.8 0.8

For the productivity adjustment, the 10-year moving average percent change adjustment for CY 2014 is 0.9 percent, which is based on the most historical data available from BLS at the time of the final rule, and reflects annual MFP estimates through 2012.

Table 22 shows the Cost Categories, Price Proxies, Cost Share Weights and the CY 2014 percent changes for each category in the revised 2006-based MEI. This table summarizes all of the final revisions to the MEI for CY 2014.

Table 22—Annual Percent Change in the Revised MEI for CY 2014 Back to Top
Revised cost category Revised price proxy 2006 Final revised cost weight2(percent) CY14 update (percent)5
[All categories]1
1The estimates are based upon the latest available Bureau of Labor Statistics data on the 10-year moving average of BLS private nonfarm business multifactor productivity published on July 19, 2013 http://www.bls.gov/news.release/prod3.nr0.htm
2The weights shown for the MEI components are the 2006 base-year weights, which may not sum to subtotals or totals because of rounding. The MEI is a fixed-weight, Laspeyres input price index whose category weights indicate the distribution of expenditures among the inputs to physicians' services for CY 2006. To determine the MEI level for a given year, the price proxy level for each component is multiplied by its 2006 weight. The sum of these products (weights multiplied by the price index levels) yields the composite MEI level for a given year. The annual percent change in the MEI levels is an estimate of price change over time for a fixed market basket of inputs to physicians' services.
3The measures of Productivity, Average Hourly Earnings, Employment Cost Indexes, as well as the various Producer and Consumer Price Indexes can be found on the Bureau of Labor Statistics (BLS) Web site at http://stats.bls.gov.
4Derived from a CMS survey of several major commercial insurers.
5Based on historical data through the 2nd quarter 2013. N/A Productivity is factored into the MEI as a subtraction from the total index growth rate; therefore, no explicit weight exists for productivity in the MEI.
MEI 100.000 0.8
MFP 10-yr moving average of Private Nonfarm Business Multifactor Productivity N/A 0.9
MEI without productivity adjustment 100.000 1.7
Physician Compensation3 50.866 1.9
Wages and Salaries ECI—Wages and salaries—Professional and Related (private) 43.641 1.9
Benefits ECI—Benefits—Professional and Related (private) 7.225 2.2
Practice Expense 49.134 1.4
Non-physician compensation 16.553 1.7
Non-physician wages 11.885 1.7
Non-health, non-physician wages 7.249 1.8
Professional & Related ECI—Wages And Salaries—Professional and Related (Private) 0.800 1.9
Management ECI—Wages And Salaries—Management, Business, and Financial (Private) 1.529 1.8
Clerical ECI—Wages And Salaries—Office and Administrative Support (Private) 4.720 1.8
Services ECI—Wages And Salaries—Service Occupations (Private) 0.200 1.5
Health related, non-physician wages ECI—Wages and Salaries -Hospital (civilian) 4.636 1.4
Non-physician benefits Composite Benefit Index 4.668 1.9
Other Practice Expense 32.581 1.2
Utilities CPI Fuels and Utilities 1.266 0.7
Miscellaneous Office Expenses 2.478 0.3
Chemicals Other Basic Organic Chemical Manufacturing PPI325190 0.723 −1.2
Paper PPI for converted paper 0.656 1.1
Rubber & Plastics PPI for rubber and plastics 0.598 0.5
All other products CPI—All Items Less Food And Energy 0.500 1.9
Telephone CPI for Telephone 1.501 0.0
Postage CPI for Postage 0.898 4.9
All Other Professional Services 8.095 1.8
Professional, Scientific, and Tech. Services ECI—Compensation: Prof. scientific, tech 2.592 1.7
Administrative and support & waste ECI—Compensation Administrative 3.052 1.9
All Other Services ECI Compensation: Services Occupations 2.451 1.6
Capital 10.310 0.7
Fixed PPI for Lessors of nonresidential buildings 8.957 0.7
Moveable PPI for Machinery and Equipment 1.353 0.7
Professional Liability Insurance4 CMS—Prof. Liability. Phys. Prem. Survey 4.295 1.5
Medical Equipment PPI—Med. Inst. & Equip. 1.978 1.2
Medical supplies Composite—PPI Surg. Appl. & CPIU Med. Supplies. (CY2006) 1.760 1.0

E. Establishing RVUs for CY 2014

Section 1848(c)(2)(B) of the Act requires that we review RVUs for physicians' services no less often than every 5 years. Under section 1848(c)(2)(K) of the Act (as added by section 3134 of the Affordable Care Act), we are required to identify and revise RVUs for services identified as potentially misvalued. To facilitate the review and appropriate adjustment of potentially misvalued services, section 1848(c)(2)(K)(iii) specifies that the Secretary may use existing processes to receive recommendations; conduct surveys, other data collection activities, studies, or other analyses as the Secretary determined to be appropriate; and use analytic contractors to identify and analyze potentially misvalued services, conduct surveys or collect data. In accordance with section 1848(c)(2)(K)(iii) of the Act, we identify potentially misvalued codes, and develop and propose appropriate adjustments to the RVUs, taking into account the recommendations provided by the AMA RUC, the Medicare Payment Advisory Commission (MedPAC), and other public commenters.

For many years, the AMA RUC has provided CMS with recommendations on the appropriate relative values for PFS services. Over the past several years, CMS and the AMA RUC have identified and reviewed a number of potentially misvalued codes on an annual basis, based on various identification screens for codes at risk for being misvalued. This annual review of work RVUs and direct PE inputs for potentially misvalued codes was further bolstered by the Affordable Care Act mandate to examine potentially misvalued codes, with an emphasis on the following categories specified in section 1848(c)(2)(K)(ii) of the Act (as added by section 3134 of the Affordable Care Act):

  • Codes and families of codes for which there has been the fastest growth.
  • Codes or families of codes that have experienced substantial changes in practice expenses.
  • Codes that are recently established for new technologies or services.
  • 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 which have not been subject to review since the implementation of the RBRVS (the “Harvard-valued” codes).
  • Other codes determined to be appropriate by the Secretary.

In addition to providing recommendations to CMS for work RVUs, the AMA RUC's Practice Expense Subcommittee reviews, and then the AMA RUC recommends, direct PE inputs (clinical labor, disposable supplies, and medical equipment) for individual services. To guide the establishment of malpractice RVUs for new and revised codes before each Five-Year Review of Malpractice, the AMA RUC also provides malpractice crosswalk recommendations, that is, “source” codes with a similar specialty mix of practitioners furnishing the source code and the new/revised code.

CMS reviews the AMA RUC recommendations on a code-by-code basis. For AMA RUC recommendations regarding physician work RVUs, after conducting a clinical review of the codes, we determine whether we agree with the recommended work RVUs for a service (that is, whether we agree the AMA RUC recommended valuation is accurate). If we disagree, we determine an alternative value that better reflects our estimate of the physician work for the service.

Because of the timing of the CPT Editorial Panel decisions, the AMA RUC recommendations, and our rulemaking cycle, we publish these work RVUs in the PFS final rule with comment period as interim final values, subject to public comment. Similarly, we assess the AMA RUC's recommendations for direct PE inputs and malpractice crosswalks, and establish interim final direct PE inputs and malpractice RVUs, which are also subject to comment. We note that the main aspect of our PE valuation that is open for public comment for a new, revised, or potentially misvalued code is the direct PE inputs and not the other elements of the PE valuation methodology, such as the indirect cost allocation methodology, that also contribute to establishing the PE RVUs for a code. The public comment period on the PFS final rule with comment period remains open for 60 days after the rule is issued.

In the interval between closure of the comment period and the subsequent year's PFS final rule with comment period, we consider all of the public comments on the interim final work, PE, and malpractice RVUs for the new, revised, and potentially misvalued codes and the results of the refinement panel, if applicable. Finally, we address the interim final work and malpractice RVUs and interim final direct PE inputs by providing a summary of the public comments and our responses to those comments, including a discussion of any changes to the interim final work or malpractice RVUs or direct PE inputs, in the following year's PFS final rule with comment period. We then typically finalize the direct PE inputs and the work, PE, and malpractice RVUs for the service in that year's PFS final rule with comment period, unless we determine it would be more appropriate to continue their interim final status for another year and solicit further public comment.

1. Methodology

We conducted a review of each code identified in this section and reviewed the current work RVU, if one exists, the AMA RUC-recommended work RVUs, intensity, and time to furnish the preservice, intraservice, and postservice activities, as well as other components of the service that contribute to the value. Our review generally includes, but is not limited to, a review of information provided by the AMA RUC, Health Care Professionals Advisory Committee (HCPAC), and other public commenters, medical literature, and comparative databases, as well as a comparison with other codes within the Medicare PFS, consultation with other physicians and health care professionals within CMS and the federal government. We also assessed the methodology and data used to develop the recommendations submitted to us by the AMA RUC and other public commenters and the rationale for the recommendations. As we noted in the CY 2011 PFS final rule with comment period (75 FR 73328 through 73329), there are a variety of methodologies and approaches used to develop work RVUs, including survey data, building blocks, crosswalk to key reference or similar codes, and magnitude estimation. When referring to a survey, unless otherwise noted, we mean the surveys conducted by specialty societies as part of the formal AMA RUC process. The building block methodology is used to construct, or deconstruct, the work RVU for a CPT code based on component pieces of the code. Components used in the building block approach may include preservice, intraservice, or postservice time and post-procedure visits. When referring to a bundled CPT code, the components could be the CPT codes that make up the bundled code. Magnitude estimation refers to a methodology for valuing physician work that determines the appropriate work RVU for a service by gauging the total amount of physician work for that service relative to the physician work for similar service across the physician fee schedule without explicitly valuing the components of that work.

The PFS incorporates cross-specialty and cross-organ system relativity. Valuing services requires an assessment of relative value and takes into account the clinical intensity and time required to furnish a service. In selecting which methodological approach will best determine the appropriate value for a service, we consider the current and recommended work and time values, as well as the intensity of the service, all relative to other services.

Several years ago, to aid in the development of preservice time recommendations for new and revised CPT codes, the AMA RUC created standardized preservice time packages. The packages include preservice evaluation time, preservice positioning time, and preservice scrub, dress and wait time. Currently there are six preservice time packages for services typically furnished in the facility setting, reflecting the different combinations of straightforward or difficult procedure, straightforward or difficult patient, and without or with sedation/anesthesia. Currently there are two preservice time packages for services typically furnished in the nonfacility setting, reflecting procedures without and with sedation/anesthesia care.

We have developed several standard building block methodologies to appropriately value services when they have common billing patterns. In cases where a service is typically furnished to a beneficiary on the same day as an evaluation and management (E/M) service, we believe that there is overlap between the two services in some of the activities furnished during the preservice evaluation and postservice time. We believe that at least one-third of the physician time in both the preservice evaluation and postservice period is duplicative of work furnished during the E/M visit. Accordingly, in cases where we believe that the AMA RUC has not adequately accounted for the overlapping activities in the recommended work RVU and/or times, we adjust the work RVU and/or times to account for the overlap. The work RVU for a service is the product of the time involved in furnishing the service times the intensity of the work. Preservice evaluation time and postservice time both have a long-established intensity of work per unit of time (IWPUT) of 0.0224, which means that 1 minute of preservice evaluation or postservice time equates to 0.0224 of a work RVU. Therefore, in many cases when we remove 2 minutes of preservice time and 2 minutes of postservice time from a procedure to account for the overlap with the same day E/M service, we also remove a work RVU of 0.09 (4 minutes × 0.0224 IWPUT) if we do not believe the overlap in time has already been accounted for in the work RVU. We continue to believe this adjustment is appropriate. The AMA RUC has recognized this valuation policy and, in many cases, addresses the overlap in time and work when a service is typically provided on the same day as an E/M service.

2. Responding to CY 2013 Interim Final RVUs and CY 2014 Proposed RVUs

In this section, we address the interim final values published in the CY 2013 PFS final rule with comment period, as subsequently corrected in the correction notice (78 FR 48996), and the proposed values published in the CY 2014 PFS proposed rule. We discuss the results of the CY 2013 refinement panel for CY 2013 interim final codes the panel reviewed, respond to public comments received on specific interim final and proposed RVUs and direct PE inputs, and address the other new, revised, or potentially misvalued codes with interim final or proposed values. The direct PE inputs are listed in a file called “CY 2014 PFS Direct PE Inputs,” available on the CMS Web site under downloads for the CY 2014 PFS final rule with comment period at http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PhysicianFeeSched/PFS-Federal-Regulation-Notices.html. The final CY 2014 work, PE, and malpractice RVUs are in Addendum B of a file called “CY 2014 PFS Addenda,” available on the CMS Web site under downloads for the CY 2014 PFS final rule with comment period at http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PhysicianFeeSched/PFS-Federal-Regulation-Notices.html.

(a) Finalizing CY 2013 Interim Final Work RVUs for CY 2014

(i) Refinement Panel

(1) Refinement Panel Process

As discussed in the 1993 PFS final rule with comment period (57 FR 55938), we adopted a refinement panel process to assist us in reviewing the public comments on CPT codes with interim final work RVUs for a year and in developing final work values for the subsequent year. We decided the panel would be comprised of a multispecialty group of physicians who would review and discuss the work involved in each procedure under review, and then each panel member would individually rate the work of the procedure. We believed establishing the panel with a multispecialty group would balance the interests of the specialty societies who commented on the work RVUs with the budgetary and redistributive effects that could occur if we accepted extensive increases in work RVUs across a broad range of services. Depending on the number and range of codes that are subject to refinement in a given year, we establish refinement panels with representatives from four groups of physicians: Clinicians representing the specialty identified with the procedures in question; physicians with practices in related specialties; primary care physicians; and contractor medical directors (CMDs). Typical panels have included 8 to 10 physicians across the four groups.

Following the addition of section 1848(c)(2)(K) to the Act by Section 3134 of the Affordable Care Act, which required the Secretary periodically to review potentially misvalued codes and make appropriate adjustments to the RVUs, we reassessed the refinement panel process. As detailed in the CY 2011 PFS final rule with comment period (75 FR 73306), we believed that the refinement panel process may provide an opportunity to review and discuss the proposed and interim final work RVUs with a clinically diverse group of experts, who then provide informed recommendations. Therefore, we indicated that we would continue the refinement process, but with administrative modification and clarification. We also noted that we would continue using the established composition that includes representatives from the four groups of physicians—clinicians representing the specialty identified with the procedures in question, physicians with practices in related specialties, primary care physicians, and CMDs.

At that time, we made a change in how we calculated refinement panel results. The basis of the refinement panel process is that, following discussion of the information but without an attempt to reach a consensus, each member of the panel submits an independent rating to CMS. Historically, the refinement panel's recommendation to change a work value or to retain the interim final value had hinged solely on the outcome of a statistical test on the ratings (an F-test of panel ratings among the groups of participants). Over time, we found the statistical test used to evaluate the RVU ratings of individual panel members became less reliable as the physicians in each group tended to select a previously discussed value, rather than developing a unique value, thereby reducing the observed variability needed to conduct a robust statistical test. In addition, reliance on values developed using the F-test also occasionally resulted in rank order anomalies among services (that is, a more complex procedure is assigned lower RVUs than a less complex procedure). As a result, we eliminated the use of the statistical F-test and instead used the median work value of the individual panel members' ratings. We said that this approach would simplify the refinement process administratively, while providing a result that reflects the summary opinion of the panel members based on a commonly used measure of central tendency that is not significantly affected by outlier values.

At the same time, we clarified that we have the final authority to set the work RVUs, including making adjustments to the work RVUs resulting from the refinement process, and that we will make such adjustments if warranted by policy concerns (75 FR 73307).

As we continue to strive to make the refinement panel process as effective and efficient as possible, we would like to remind readers that the refinement panels are not intended to review every code for which we did not accept the AMA RUC-recommended work RVUs. Rather, the refinement panels are designed for situations where there is new information available that might provide a reason for a change in work values and for which a multispecialty panel of physicians might provide input that would assist us in making work RVU decisions. To facilitate the selection of services for the refinement panels, we would like to remind specialty societies seeking reconsideration of interim final work RVUs, including consideration by a refinement panel, to specifically state in their public comments that they are requesting refinement panel review. Furthermore, we have asked commenters requesting refinement panel review to submit sufficient new information concerning the clinical aspects of the work assigned for a service to indicate that referral to the refinement panel is warranted (57 FR 55917).

We note that most of the information presented during the last several refinement panel discussions has been duplicative of the information provided to the AMA RUC during its development of recommendations. As detailed in section II.E.1. of this final rule with comment period, we consider information and recommendations from the AMA RUC when assigning proposed and interim final RVUs to services. Thus, if the only information that a commenter has to present is information already considered by the AMA RUC, referral to a refinement panel is not appropriate. To facilitate selection of codes for refinement, we request that commenters seeking refinement panel review of work RVUs submit supporting information that has not already been considered the AMA RUC in creating recommended work RVUs or by CMS in assigning proposed and interim final work RVUs. We can make best use of our resources as well as those of the specialties involved and physician volunteers by avoiding duplicative consideration of information by the AMA RUC, CMS, and a refinement panel. To achieve this goal, CMS will continue to critically evaluate the need to refer codes to refinement panels in future years, specifically considering any new information provided by commenters.

(2) CY 2013 Interim Final Work RVUs Considered by the Refinement Panel

We referred to the CY 2013 refinement panel 12 CPT codes with CY 2013 interim final work values for which we received a request for refinement that met the requirements described above. For these 12 CPT codes, all commenters requested increased work RVUs. For ease of discussion, we will be referring to these services as “refinement codes.” Consistent with the process described above, we convened a multi-specialty panel of physicians to assist us in the review of the information submitted to support increased work RVUs. The panel was moderated by our physician advisors, and consisted of the following voting members:

  • One to two clinicians representing the commenting organization.
  • One to two primary care clinicians nominated by the American Academy of Family Physicians and the American College of Physicians.
  • Four Contractor Medical Directors (CMDs).
  • One to two clinicians with practices in related specialties, who were expected to have knowledge of the services under review.

The panel process was designed to capture each participant's independent judgment and his or her clinical experience which informed and drove the discussion of the refinement code during the refinement panel proceedings. Following the discussion, each voting participant rated the physician work of the refinement code and submitted those ratings to CMS directly and confidentially. We note that not all voting participants voted for every CPT code. There was no attempt to achieve consensus among the panel members. As finalized in the CY 2011 PFS final rule with comment period (75 FR 73307), we calculated the median value for each service based upon the individual ratings that were submitted to CMS by panel participants.

Table 23 presents information on the work RVUs for the codes considered by the refinement panel, including the refinement panel ratings and the final CY 2014 work RVUs. In section II.E.2.a.ii., we discuss each of the individual codes reviewed by the refinement panel.

Table 23—Codes Reviewed by the 2013 Multi-Specialty Refinement Panel Back to Top
HCPCS code Short descriptor CY 2013 interim final work RVU AMA RUC/HCPAC recommended work RVU Refinement panel median rating CY 2014 work RVU
35475 Angioplasty, arterial 5.75 6.60 6.60 6.60
35476 Angioplasty, venous 4.71 5.10 5.10 5.10
93655 Arrhythmia ablation add-on 7.50 9.00 9.00 7.50
93657 Afibablation add-on 7.50 10.00 10.00 7.50
95886 EMG extremity add-on 0.70 0.92 0.92 0.86
95887 EMG non-extremity add-on 0.47 0.73 0.73 0.71
95908 Nerve conduction studies; 3-4 studies 1.25 1.37 1.37 1.25
95909 Nerve conduction studies; 5-6 studies 1.50 1.77 1.77 1.50
95910 Nerve conduction studies; 7-8 studies 2.00 2.80 2.80 2.00
95911 Nerve conduction studies; 9-10 studies 2.50 3.34 3.34 2.50
92912 Nerve conduction studies; 11-12 studies 3.00 4.00 4.00 3.00
95913 Nerve conduction studies; 13 or more studies 3.56 4.20 4.20 3.56

(ii) Code-Specific Issues

Table 24 of this final rule with comment period lists all codes that had a CY 2013 interim final work value. This chart provides the CY 2013 work RVUs, the CY 2014 work RVUs and indicates whether we are finalizing the CY 2014 work RVUs. If there is no work RVUs listed, a letter indicates the relevant PFS procedure status indicator. A list of the PFS procedure status indicators can be found in Addendum A. If the CY 2014 Action column indicates that the CY 2014 values are interim final, public comments on these values will be accepted during the public comment period on this final rule with comment period. The comprehensive list of all CY 2014 RVUs is in Addendum B to this final rule with comment period, which is contained in the “CY 2014 PFS Addenda” available on the CMS Web site under downloads for the CY 2014 PFS final rule with comment period at http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PhysicianFeeSched/PFS-Federal-Regulation-Notices.html. The comprehensive list of all CY 2013 values is in Addendum B to the CY 2013 Correction Notice which is contained in the “CMS-1590-CN Addenda,” available on the CMS Web site under downloads for the CY 2013 correction notice at http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PhysicianFeeSched/PFS-Federal-Regulation-Notices.html. The time values for all codes are listed in a file called “CY 2014 PFS Physician Time,” available on the CMS Web site under downloads for the CY 2014 PFS final rule with comment period at http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PhysicianFeeSched/PFS-Federal-Regulation-Notices.html.

Table 24—Codes With CY 2013 Interim Final Work Values Back to Top
HCPCS code Long descriptor CY 2013 work RVU CY 2014 work RVU CY 2014 action
10120 Incision and removal of foreign body, subcutaneous tissues; simple 1.22 1.22 Finalize.
11055 Paring or cutting of benign hyperkeratotic lesion (eg, corn or callus); single lesion 0.35 0.35 Finalize.
11056 Paring or cutting of benign hyperkeratotic lesion (eg, corn or callus); 2 to 4 lesions 0.50 0.50 Finalize.
11057 Paring or cutting of benign hyperkeratotic lesion (eg, corn or callus); more than 4 lesions 0.65 0.65 Finalize.
11300 Shaving of epidermal or dermal lesion, single lesion, trunk, arms or legs; lesion diameter 0.5 cm or less 0.60 0.60 Finalize.
11301 Shaving of epidermal or dermal lesion, single lesion, trunk, arms or legs; lesion diameter 0.6 to 1.0 cm 0.90 0.90 Finalize.
11302 Shaving of epidermal or dermal lesion, single lesion, trunk, arms or legs; lesion diameter 1.1 to 2.0 cm 1.05 1.05 Finalize.
11303 Shaving of epidermal or dermal lesion, single lesion, trunk, arms or legs; lesion diameter over 2.0 cm 1.25 1.25 Finalize.
11305 Shaving of epidermal or dermal lesion, single lesion, scalp, neck, hands, feet, genitalia; lesion diameter 0.5 cm or less 0.80 0.80 Finalize.
11306 Shaving of epidermal or dermal lesion, single lesion, scalp, neck, hands, feet, genitalia; lesion diameter 0.6 to 1.0 cm 0.96 0.96 Finalize.
11307 Shaving of epidermal or dermal lesion, single lesion, scalp, neck, hands, feet, genitalia; lesion diameter 1.1 to 2.0 cm 1.20 1.20 Finalize.
11308 Shaving of epidermal or dermal lesion, single lesion, scalp, neck, hands, feet, genitalia; lesion diameter over 2.0 cm 1.46 1.46 Finalize.
11310 Shaving of epidermal or dermal lesion, single lesion, face, ears, eyelids, nose, lips, mucous membrane; lesion diameter 0.5 cm or less 0.80 0.80 Finalize.
11311 Shaving of epidermal or dermal lesion, single lesion, face, ears, eyelids, nose, lips, mucous membrane; lesion diameter 0.6 to 1.0 cm 1.10 1.10 Finalize.
11312 Shaving of epidermal or dermal lesion, single lesion, face, ears, eyelids, nose, lips, mucous membrane; lesion diameter 1.1 to 2.0 cm 1.30 1.30 Finalize.
11313 Shaving of epidermal or dermal lesion, single lesion, face, ears, eyelids, nose, lips, mucous membrane; lesion diameter over 2.0 cm 1.68 1.68 Finalize.
11719 Trimming of nondystrophic nails, any number 0.17 0.17 Finalize.
12035 Repair, intermediate, wounds of scalp, axillae, trunk and/or extremities (excluding hands and feet); 12.6 cm to 20.0 cm 3.50 3.50 Finalize.
12036 Repair, intermediate, wounds of scalp, axillae, trunk and/or extremities (excluding hands and feet); 20.1 cm to 30.0 cm 4.23 4.23 Finalize.
12037 Repair, intermediate, wounds of scalp, axillae, trunk and/or extremities (excluding hands and feet); over 30.0 cm 5.00 5.00 Finalize.
12045 Repair, intermediate, wounds of neck, hands, feet and/or external genitalia; 12.6 cm to 20.0 cm 3.75 3.75 Finalize.
12046 Repair, intermediate, wounds of neck, hands, feet and/or external genitalia; 20.1 cm to 30.0 cm 4.30 4.30 Finalize.
12047 Repair, intermediate, wounds of neck, hands, feet and/or external genitalia; over 30.0 cm 4.95 4.95 Finalize.
12055 Repair, intermediate, wounds of face, ears, eyelids, nose, lips and/or mucous membranes; 12.6 cm to 20.0 cm 4.50 4.50 Finalize.
12056 Repair, intermediate, wounds of face, ears, eyelids, nose, lips and/or mucous membranes; 20.1 cm to 30.0 cm 5.30 5.30 Finalize.
12057 Repair, intermediate, wounds of face, ears, eyelids, nose, lips and/or mucous membranes; over 30.0 cm 6.00 6.00 Finalize.
13100 Repair, complex, trunk; 1.1 cm to 2.5 cm 3.00 3.00 Finalize.
13101 Repair, complex, trunk; 2.6 cm to 7.5 cm 3.50 3.50 Finalize.
13102 Repair, complex, trunk; each additional 5 cm or less (list separately in addition to code for primary procedure) 1.24 1.24 Finalize.
13120 Repair, complex, scalp, arms, and/or legs; 1.1 cm to 2.5 cm 3.23 3.23 Finalize.
13121 Repair, complex, scalp, arms, and/or legs; 2.6 cm to 7.5 cm 4.00 4.00 Finalize.
13122 Repair, complex, scalp, arms, and/or legs; each additional 5 cm or less (list separately in addition to code for primary procedure) 1.44 1.44 Finalize.
13131 Repair, complex, forehead, cheeks, chin, mouth, neck, axillae, genitalia, hands and/or feet; 1.1 cm to 2.5 cm 3.73 3.73 Finalize.
13132 Repair, complex, forehead, cheeks, chin, mouth, neck, axillae, genitalia, hands and/or feet; 2.6 cm to 7.5 cm 4.78 4.78 Finalize.
13133 Repair, complex, forehead, cheeks, chin, mouth, neck, axillae, genitalia, hands and/or feet; each additional 5 cm or less (list separately in addition to code for primary procedure) 2.19 2.19 Finalize.
13150 Repair, complex, eyelids, nose, ears and/or lips; 1.0 cm or less 3.58 D D.
13151 Repair, complex, eyelids, nose, ears and/or lips; 1.1 cm to 2.5 cm 4.34 4.34 Finalize.
13152 Repair, complex, eyelids, nose, ears and/or lips; 2.6 cm to 7.5 cm 4.90 5.34 Finalize.
13153 Repair, complex, eyelids, nose, ears and/or lips; each additional 5 cm or less (list separately in addition to code for primary procedure) 2.38 2.38 Finalize.
20985 Computer-assisted surgical navigational procedure for musculoskeletal procedures, image-less (list separately in addition to code for primary procedure) 2.50 2.50 Finalize.
22586 Arthrodesis, pre-sacral interbody technique, including disc space preparation, discectomy, with posterior instrumentation, with image guidance, includes bone graft when performed, l5-s1 interspace 28.12 28.12 Finalize.
23350 Injection procedure for shoulder arthrography or enhanced ct/mri shoulder arthrography 1.00 1.00 Finalize.
23331 Removal of foreign body, shoulder; deep (eg, neer hemiarthroplasty removal) 7.63 D D.
23332 Removal of foreign body, shoulder; complicated (eg, total shoulder) 12.37 D D.
23472 Arthroplasty, glenohumeral joint; total shoulder (glenoid and proximal humeral replacement (eg, total shoulder)) 22.13 22.13 Finalize.
23473 Revision of total shoulder arthroplasty, including allograft when performed; humeral or glenoid component 25.00 25.00 Finalize.
23474 Revision of total shoulder arthroplasty, including allograft when performed; humeral and glenoid component 27.21 27.21 Finalize.
23600 Closed treatment of proximal humeral (surgical or anatomical neck) fracture; without manipulation 3.00 3.00 Interim Final.
24160 Implant removal; elbow joint 8.00 18.63 Interim Final.
24363 Arthroplasty, elbow; with distal humerus and proximal ulnar prosthetic replacement (eg, total elbow) 22.00 22.00 Finalize.
24370 Revision of total elbow arthroplasty, including allograft when performed; humeral or ulnar component 23.55 23.55 Finalize.
24371 Revision of total elbow arthroplasty, including allograft when performed; humeral and ulnar component 27.50 27.50 Finalize.
28470 Closed treatment of metatarsal fracture; without manipulation, each 2.03 2.03 Interim Final.
29075 Application, cast; elbow to finger (short arm) 0.77 0.77 Interim Final.
29581 Application of multi-layer compression system; leg (below knee), including ankle and foot 0.25 0.25 Interim Final.
29582 Application of multi-layer compression system; thigh and leg, including ankle and foot, when performed 0.35 0.35 Interim Final.
29583 Application of multi-layer compression system; upper arm and forearm 0.25 0.25 Interim Final.
29584 Application of multi-layer compression system; upper arm, forearm, hand, and fingers 0.35 0.35 Interim Final.
29824 Arthroscopy, shoulder, surgical; distal claviculectomy including distal articular surface (mumford procedure) 8.98 8.98 Interim Final.
29826 Arthroscopy, shoulder, surgical; decompression of subacromial space with partial acromioplasty, with coracoacromial ligament (ie, arch) release, when performed (list separately in addition to code for primary procedure) 3.00 3.00 Interim Final.
29827 Arthroscopy, shoulder, surgical; with rotator cuff repair 15.59 15.59 Finalize.
29828 Arthroscopy, shoulder, surgical; biceps tenodesis 13.16 13.16 Finalize.
31231 Nasal endoscopy, diagnostic, unilateral or bilateral (separate procedure) 1.10 1.10 Finalize.
31647 Bronchoscopy, rigid or flexible, including fluoroscopic guidance, when performed; with balloon occlusion, when performed, assessment of air leak, airway sizing, and insertion of bronchial valve(s), initial lobe 4.40 4.40 Finalize.
31648 Bronchoscopy, rigid or flexible, including fluoroscopic guidance, when performed; with removal of bronchial valve(s), initial lobe 4.20 4.20 Finalize.
31649 Bronchoscopy, rigid or flexible, including fluoroscopic guidance, when performed; with removal of bronchial valve(s), each additional lobe (list separately in addition to code for primary procedure) 1.44 1.44 Finalize.
31651 Bronchoscopy, rigid or flexible, including fluoroscopic guidance, when performed; with balloon occlusion, when performed, assessment of air leak, airway sizing, and insertion of bronchial valve(s), each additional lobe (list separately in addition to code for primary procedure[s]) 1.58 1.58 Finalize.
31660 Bronchoscopy, rigid or flexible, including fluoroscopic guidance, when performed; with bronchial thermoplasty, 1 lobe 4.25 4.25 Finalize.
31661 Bronchoscopy, rigid or flexible, including fluoroscopic guidance, when performed; with bronchial thermoplasty, 2 or more lobes 4.50 4.50 Finalize.
32440 Removal of lung, pneumonectomy 27.28 27.28 Finalize.
32480 Removal of lung, other than pneumonectomy; single lobe (lobectomy) 25.82 25.82 Finalize.
32482 Removal of lung, other than pneumonectomy; 2 lobes (bilobectomy) 27.44 27.44 Finalize.
32491 Removal of lung, other than pneumonectomy; with resection-plication of emphysematous lung(s) (bullous or non-bullous) for lung volume reduction, sternal split or transthoracic approach, includes any pleural procedure, when performed 25.24 25.24 Finalize.
32551 Tube thoracostomy, includes connection to drainage system (eg, water seal), when performed, open (separate procedure) 3.29 3.29 Finalize.
32554 Thoracentesis, needle or catheter, aspiration of the pleural space; without imaging guidance 1.82 1.82 Finalize.
32555 Thoracentesis, needle or catheter, aspiration of the pleural space; with imaging guidance 2.27 2.27 Finalize.
32556 Pleural drainage, percutaneous, with insertion of indwelling catheter; without imaging guidance 2.50 2.50 Finalize.
32557 Pleural drainage, percutaneous, with insertion of indwelling catheter; with imaging guidance 3.12 3.12 Finalize.
32663 Thoracoscopy, surgical; with lobectomy (single lobe) 24.64 24.64 Finalize.
32668 Thoracoscopy, surgical; with diagnostic wedge resection followed by anatomic lung resection (list separately in addition to code for primary procedure) 3.00 3.00 Finalize.
32669 Thoracoscopy, surgical; with removal of a single lung segment (segmentectomy) 23.53 23.53 Finalize.
32670 Thoracoscopy, surgical; with removal of two lobes (bilobectomy) 28.52 28.52 Finalize.
32671 Thoracoscopy, surgical; with removal of lung (pneumonectomy) 31.92 31.92 Finalize.
32672 Thoracoscopy, surgical; with resection-plication for emphysematous lung (bullous or non-bullous) for lung volume reduction (lvrs), unilateral includes any pleural procedure, when performed 27.00 27.00 Finalize.
32673 Thoracoscopy, surgical; with resection of thymus, unilateral or bilateral 21.13 21.13 Finalize.
32701 Thoracic target(s) delineation for stereotactic body radiation therapy (srs/sbrt), (photon or particle beam), entire course of treatment 4.18 4.18 Finalize.
33361 Transcatheter aortic valve replacement (tavr/tavi) with prosthetic valve; percutaneous femoral artery approach 25.13 25.13 Finalize.
33362 Transcatheter aortic valve replacement (tavr/tavi) with prosthetic valve; open femoral artery approach 27.52 27.52 Finalize.
33363 Transcatheter aortic valve replacement (tavr/tavi) with prosthetic valve; open axillary artery approach 28.50 28.50 Finalize.
33364 Transcatheter aortic valve replacement (tavr/tavi) with prosthetic valve; open iliac artery approach 30.00 30.00 Finalize.
33365 Transcatheter aortic valve replacement (tavr/tavi) with prosthetic valve; transaortic approach (eg, median sternotomy, mediastinotomy) 33.12 33.12 Finalize.
33367 Transcatheter aortic valve replacement (tavr/tavi) with prosthetic valve; cardiopulmonary bypass support with percutaneous peripheral arterial and venous cannulation (eg, femoral vessels) (list separately in addition to code for primary procedure) 11.88 11.88 Finalize.
33368 Transcatheter aortic valve replacement (tavr/tavi) with prosthetic valve; cardiopulmonary bypass support with open peripheral arterial and venous cannulation (eg, femoral, iliac, axillary vessels) (list separately in addition to code for primary procedure) 14.39 14.39 Finalize.
33369 Transcatheter aortic valve replacement (tavr/tavi) with prosthetic valve; cardiopulmonary bypass support with central arterial and venous cannulation (eg, aorta, right atrium, pulmonary artery) (list separately in addition to code for primary procedure) 19.00 19.00 Finalize.
33405 Replacement, aortic valve, with cardiopulmonary bypass; with prosthetic valve other than homograft or stentless valve 41.32 41.32 Finalize.
33430 Replacement, mitral valve, with cardiopulmonary bypass 50.93 50.93 Finalize.
33533 Coronary artery bypass, using arterial graft(s); single arterial graft 33.75 33.75 Finalize.
33990 Insertion of ventricular assist device, percutaneous including radiological supervision and interpretation; arterial access only 8.15 8.15 Finalize.
33991 Insertion of ventricular assist device, percutaneous including radiological supervision and interpretation; both arterial and venous access, with transseptal puncture 11.88 11.88 Finalize.
33992 Removal of percutaneous ventricular assist device at separate and distinct session from insertion 4.00 4.00 Finalize.
33993 Repositioning of percutaneous ventricular assist device with imaging guidance at separate and distinct session from insertion 3.51 3.51 Finalize.
35475 Transluminal balloon angioplasty, percutaneous; brachiocephalic trunk or branches, each vessel 5.75 6.60 Finalize.
35476 Transluminal balloon angioplasty, percutaneous; venous 4.71 5.10 Finalize.
36221 Non-selective catheter placement, thoracic aorta, with angiography of the extracranial carotid, vertebral, and/or intracranial vessels, unilateral or bilateral, and all associated radiological supervision and interpretation, includes angiography of the cervicocerebral arch, when performed 4.17 4.17 Finalize.
36222 Selective catheter placement, common carotid or innominate artery, unilateral, any approach, with angiography of the ipsilateral extracranial carotid circulation and all associated radiological supervision and interpretation, includes angiography of the cervicocerebral arch, when performed 5.53 5.53 Finalize.
36223 Selective catheter placement, common carotid or innominate artery, unilateral, any approach, with angiography of the ipsilateral intracranial carotid circulation and all associated radiological supervision and interpretation, includes angiography of the extracranial carotid and cervicocerebral arch, when performed 6.00 6.00 Finalize.
36224 Selective catheter placement, internal carotid artery, unilateral, with angiography of the ipsilateral intracranial carotid circulation and all associated radiological supervision and interpretation, includes angiography of the extracranial carotid and cervicocerebral arch, when performed 6.50 6.50 Finalize.
36225 Selective catheter placement, subclavian or innominate artery, unilateral, with angiography of the ipsilateral vertebral circulation and all associated radiological supervision and interpretation, includes angiography of the cervicocerebral arch, when performed 6.00 6.00 Finalize.
36226 Selective catheter placement, vertebral artery, unilateral, with angiography of the ipsilateral vertebral circulation and all associated radiological supervision and interpretation, includes angiography of the cervicocerebral arch, when performed 6.50 6.50 Finalize.
36227 Selective catheter placement, external carotid artery, unilateral, with angiography of the ipsilateral external carotid circulation and all associated radiological supervision and interpretation (list separately in addition to code for primary procedure) 2.09 2.09 Finalize.
36228 Selective catheter placement, each intracranial branch of the internal carotid or vertebral arteries, unilateral, with angiography of the selected vessel circulation and all associated radiological supervision and interpretation (eg, middle cerebral artery, posterior inferior cerebellar artery) (list separately in addition to code for primary procedure) 4.25 4.25 Finalize.
37197 Transcatheter retrieval, percutaneous, of intravascular foreign body (eg, fractured venous or arterial catheter), includes radiological supervision and interpretation, and imaging guidance (ultrasound or fluoroscopy), when performed 6.29 6.29 Finalize.
37211 Transcatheter therapy, arterial infusion for thrombolysis other than coronary, any method, including radiological supervision and interpretation, initial treatment day 8.00 8.00 Finalize.
37212 Transcatheter therapy, venous infusion for thrombolysis, any method, including radiological supervision and interpretation, initial treatment day 7.06 7.06 Finalize.
37213 Transcatheter therapy, arterial or venous infusion for thrombolysis other than coronary, any method, including radiological supervision and interpretation, continued treatment on subsequent day during course of thrombolytic therapy, including follow-up catheter contrast injection, position change, or exchange, when performed 5.00 5.00 Finalize.
37214 Transcatheter therapy, arterial or venous infusion for thrombolysis other than coronary, any method, including radiological supervision and interpretation, continued treatment on subsequent day during course of thrombolytic therapy, including follow-up catheter contrast injection, position change, or exchange, when performed 2.74 2.74 Finalize.
38240 Hematopoietic progenitor cell (hpc); allogeneic transplantation per donor 3.00 4.00 Finalize.
38241 Hematopoietic progenitor cell (hpc); autologous transplantation 3.00 3.00 Finalize.
38242 Allogeneic lymphocyte infusions 2.11 2.11 Finalize.
38243 Hematopoietic progenitor cell (hpc); hpc boost 2.13 2.13 Finalize.
40490 Biopsy of lip 1.22 1.22 Finalize.
43206 Esophagoscopy, rigid or flexible; with optical endomicroscopy C 2.39 Interim Final.
43252 Upper gastrointestinal endoscopy including esophagus, stomach, and either the duodenum and/or jejunum as appropriate; with optical endomicroscopy C 3.06 Interim Final.
44705 Preparation of fecal microbiota for instillation, including assessment of donor specimen I I Finalize.
45330 Sigmoidoscopy, flexible; diagnostic, with or without collection of specimen(s) by brushing or washing (separate procedure) 0.96 0.96 Finalize.
47562 Laparoscopy, surgical; cholecystectomy 10.47 10.47 Finalize.
47563 Laparoscopy, surgical; cholecystectomy with cholangiography 11.47 11.47 Finalize.
47600 Cholecystectomy 17.48 17.48 Finalize.
47605 Cholecystectomy; with cholangiography 18.48 18.48 Finalize.
49505 Repair initial inguinal hernia, age 5 years or older; reducible 7.96 7.96 Finalize.
50590 Lithotripsy, extracorporeal shock wave 9.77 9.77 Finalize.
52214 Cystourethroscopy, with fulguration (including cryosurgery or laser surgery) of trigone, bladder neck, prostatic fossa, urethra, or periurethral glands 3.50 3.50 Finalize.
52224 Cystourethroscopy, with fulguration (including cryosurgery or laser surgery) or treatment of minor (less than 0.5 cm) lesion(s) with or without biopsy 4.05 4.05 Finalize.
52234 Cystourethroscopy, with fulguration (including cryosurgery or laser surgery) and/or resection of; small bladder tumor(s) (0.5 up to 2.0 cm) 4.62 4.62 Finalize.
52235 Cystourethroscopy, with fulguration (including cryosurgery or laser surgery) and/or resection of; medium bladder tumor(s) (2.0 to 5.0 cm) 5.44 5.44 Finalize.
52240 Cystourethroscopy, with fulguration (including cryosurgery or laser surgery) and/or resection of; large bladder tumor(s) 7.50 7.50 Finalize.
52287 Cystourethroscopy, with injection(s) for chemodenervation of the bladder 3.20 3.20 Finalize.
52351 Cystourethroscopy, with ureteroscopy and/or pyeloscopy; diagnostic 5.75 5.75 Finalize.
52352 Cystourethroscopy, with ureteroscopy and/or pyeloscopy; with removal or manipulation of calculus (ureteral catheterization is included) 6.75 6.75 Finalize.
52353 Cystourethroscopy, with ureteroscopy and/or pyeloscopy; with lithotripsy (ureteral catheterization is included) 7.50 7.50 Finalize.
52354 Cystourethroscopy, with ureteroscopy and/or pyeloscopy; with biopsy and/or fulguration of ureteral or renal pelvic lesion 8.00 8.00 Finalize.
52355 Cystourethroscopy, with ureteroscopy and/or pyeloscopy; with resection of ureteral or renal pelvic tumor 9.00 9.00 Finalize.
53850 Transurethral destruction of prostate tissue; by microwave thermotherapy 10.08 10.08 Finalize.
60520 Thymectomy, partial or total; transcervical approach (separate procedure) 17.16 17.16 Finalize.
60521 Thymectomy, partial or total; sternal split or transthoracic approach, without radical mediastinal dissection (separate procedure) 19.18 19.18 Finalize.
60522 Thymectomy, partial or total; sternal split or transthoracic approach, with radical mediastinal dissection (separate procedure) 23.48 23.48 Finalize.
64450 Injection, anesthetic agent; other peripheral nerve or branch 0.75 0.75 Finalize.
64612 Chemodenervation of muscle(s); muscle(s) innervated by facial nerve, unilateral (eg, for blepharospasm, hemifacial spasm) 1.41 1.41 Finalize.
64613 Chemodenervation of muscle(s); neck muscle(s) (eg, for spasmodic torticollis, spasmodic dysphonia) 2.01 D D.
64614 Chemodenervation of muscle(s); extremity and/or trunk muscle(s) (eg, for dystonia, cerebral palsy, multiple sclerosis) 2.20 D D.
64615 Chemodenervation of muscle(s); muscle(s) innervated by facial, trigeminal, cervical spinal and accessory nerves, bilateral (eg, for chronic migraine) 1.85 1.85 Finalize.
64640 Destruction by neurolytic agent; other peripheral nerve or branch 1.23 1.23 Finalize.
65222 Removal of foreign body, external eye; corneal, with slit lamp 0.84 0.84 Finalize.
65800 Paracentesis of anterior chamber of eye (separate procedure); with removal of aqueous 1.53 1.53 Finalize.
66982 Extracapsular cataract removal with insertion of intraocular lens prosthesis (1-stage procedure), manual or mechanical technique (eg, irrigation and aspiration or phacoemulsification), complex, requiring devices or techniques not generally used in routine cataract surgery (eg, iris expansion device, suture support for intraocular lens, or primary posterior capsulorrhexis) or performed on patients in the amblyogenic developmental stage 11.08 11.08 Finalize.
66984 Extracapsular cataract removal with insertion of intraocular lens prosthesis (1 stage procedure), manual or mechanical technique (eg, irrigation and aspiration or phacoemulsification) 8.52 8.52 Finalize.
67028 Intravitreal injection of a pharmacologic agent (separate procedure) 1.44 1.44 Finalize.
67810 Incisional biopsy of eyelid skin including lid margin 1.18 1.18 Finalize.
68200 Subconjunctival injection 0.49 0.49 Finalize.
69200 Removal foreign body from external auditory canal; without general anesthesia 0.77 0.77 Finalize.
69433 Tympanostomy (requiring insertion of ventilating tube), local or topical anesthesia 1.57 1.57 Finalize.
72040 Radiologic examination, spine, cervical; 3 views or less 0.22 0.22 Finalize.
72050 Radiologic examination, spine, cervical; 4 or 5 views 0.31 0.31 Finalize.
72052 Radiologic examination, spine, cervical; 6 or more views 0.36 0.36 Finalize.
72191 Computed tomographic angiography, pelvis, with contrast material(s), including noncontrast images, if performed, and image postprocessing 1.81 1.81 Interim Final.
73221 Magnetic resonance (eg, proton) imaging, any joint of upper extremity; without contrast material(s) 1.35 1.35 Finalize.
73721 Magnetic resonance (eg, proton) imaging, any joint of lower extremity; without contrast material 1.35 1.35 Finalize.
74170 Computed tomography, abdomen; without contrast material, followed by contrast material(s) and further sections 1.40 1.40 Finalize.
74174 Computed tomographic angiography, abdomen and pelvis, with contrast material(s), including noncontrast images, if performed, and image postprocessing 2.20 2.20 Finalize.
74175 Computed tomographic angiography, abdomen, with contrast material(s), including noncontrast images, if performed, and image postprocessing 1.90 1.90 Finalize.
74247 Radiological examination, gastrointestinal tract, upper, air contrast, with specific high density barium, effervescent agent, with or without glucagon; with or without delayed films, with kub 0.69 0.69 Finalize.
74280 Radiologic examination, colon; air contrast with specific high density barium, with or without glucagon 0.99 0.99 Finalize.
74400 Urography (pyelography), intravenous, with or without kub, with or without tomography 0.49 0.49 Finalize.
75896-26 Transcatheter therapy, infusion, other than for thrombolysis, radiological supervision and interpretation 1.31 1.31 Interim Final.
75896-TC Transcatheter therapy, infusion, other than for thrombolysis, radiological supervision and interpretation C C Interim Final.
75898-26 Angiography through existing catheter for follow-up study for transcatheter therapy, embolization or infusion, other than for thrombolysis 1.65 1.65 Interim Final.
75898-TC Angiography through existing catheter for follow-up study for transcatheter therapy, embolization or infusion, other than for thrombolysis C C Interim Final.
76830 Ultrasound, transvaginal 0.69 0.69 Finalize.
76872 Ultrasound, transrectal 0.69 0.69 Finalize.
77001 Fluoroscopic guidance for central venous access device placement, replacement (catheter only or complete), or removal (includes fluoroscopic guidance for vascular access and catheter manipulation, any necessary contrast injections through access site or catheter with related venography radiologic supervision and interpretation, and radiographic documentation of final catheter position) (list separately in addition to code for primary procedure) 0.38 0.38 Interim Final.
77002 Fluoroscopic guidance for needle placement (eg, biopsy, aspiration, injection, localization device) 0.54 0.54 Interim Final.
77003 Fluoroscopic guidance and localization of needle or catheter tip for spine or paraspinous diagnostic or therapeutic injection procedures (epidural or subarachnoid) 0.60 0.60 Interim Final.
77080 Dual-energy x-ray absorptiometry (dxa), bone density study, 1 or more sites; axial skeleton (eg, hips, pelvis, spine) 0.20 0.20 Finalize.
77082 Dual-energy x-ray absorptiometry (dxa), bone density study, 1 or more sites; vertebral fracture assessment 0.17 0.17 Finalize.
77301 Intensity modulated radiotherapy plan, including dose-volume histograms for target and critical structure partial tolerance specifications 7.99 7.99 Finalize.
78012 Thyroid uptake, single or multiple quantitative measurement(s) (including stimulation, suppression, or discharge, when performed) 0.19 0.19 Finalize.
78013 Thyroid imaging (including vascular flow, when performed) 0.37 0.37 Finalize.
78014 Thyroid imaging (including vascular flow, when performed); with single or multiple uptake(s) quantitative measurement(s) (including stimulation, suppression, or discharge, when performed) 0.50 0.50 Finalize.
78070 Parathyroid planar imaging (including subtraction, when performed) 0.80 0.80 Finalize.
78071 Parathyroid planar imaging (including subtraction, when performed); with tomographic (spect) 1.20 1.20 Finalize.
78072 Parathyroid planar imaging (including subtraction, when performed); with tomographic (spect), and concurrently acquired computed tomography (ct) for anatomical localization 1.60 1.60 Finalize.
78278 Acute gastrointestinal blood loss imaging 0.99 0.99 Finalize.
78472 Cardiac blood pool imaging, gated equilibrium; planar, single study at rest or stress (exercise and/or pharmacologic), wall motion study plus ejection fraction, with or without additional quantitative processing 0.98 0.98 Finalize.
86153 Cell enumeration using immunologic selection and identification in fluid specimen (eg, circulating tumor cells in blood); physician interpretation and report, when required 0.69 0.69 Finalize.
88120 Cytopathology, in situ hybridization (eg, fish), urinary tract specimen with morphometric analysis, 3-5 molecular probes, each specimen; manual 1.20 1.20 Interim Final.
88121 Cytopathology, in situ hybridization (eg, fish), urinary tract specimen with morphometric analysis, 3-5 molecular probes, each specimen; using computer-assisted technology 1.00 1.00 Interim Final.
88312 Special stain including interpretation and report; group i for microorganisms (eg, acid fast, methenamine silver) 0.54 0.54 Finalize.
88365 In situ hybridization (eg, fish), each probe 1.20 1.20 Interim Final.
88367 Morphometric analysis, in situ hybridization (quantitative or semi-quantitative) each probe; using computer-assisted technology 1.30 1.30 Interim Final.
88368 Morphometric analysis, in situ hybridization (quantitative or semi-quantitative) each probe; manual 1.40 1.40 Interim Final.
88375 Optical endomicroscopic image(s), interpretation and report, real-time or referred, each endoscopic session C I Interim Final.
90785 Interactive complexity (list separately in addition to the code for primary procedure) 0.11 0.33 Interim Final.
90791 Psychiatric diagnostic evaluation 2.80 3.00 Interim Final.
90792 Psychiatric diagnostic evaluation with medical services 2.96 3.25 Interim Final.
90832 Psychotherapy, 30 minutes with patient and/or family member 1.25 1.50 Interim Final.
90833 Psychotherapy, 30 minutes with patient and/or family member when performed with an evaluation and management service (list separately in addition to the code for primary procedure) 0.98 1.50 Interim Final.
90834 Psychotherapy, 45 minutes with patient and/or family member 1.89 2.00 Interim Final.
90836 Psychotherapy, 45 minutes with patient and/or family member when performed with an evaluation and management service (list separately in addition to the code for primary procedure) 1.60 1.90 Interim Final.
90837 Psychotherapy, 60 minutes with patient and/or family member 2.83 3.00 Interim Final.
90838 Psychotherapy, 60 minutes with patient and/or family member when performed with an evaluation and management service (list separately in addition to the code for primary procedure) 2.56 2.50 Interim Final.
90839 Psychotherapy for crisis; first 60 minutes C 3.13 Interim Final.
90840 Psychotherapy for crisis; each additional 30 minutes (list separately in addition to code for primary service) C 1.50 Interim Final.
90845 Psychoanalysis 1.79 2.10 Interim Final.
90846 Family psychotherapy (without the patient present) 1.83 2.40 Interim Final.
90847 Family psychotherapy (conjoint psychotherapy) (with patient present) 2.21 2.50 Interim Final.
90853 Group psychotherapy (other than of a multiple-family group) 0.59 0.59 Interim Final.
90863 Pharmacologic management, including prescription and review of medication, when performed with psychotherapy services (list separately in addition to the code for primary procedure) I I Interim Final.
91112 Gastrointestinal transit and pressure measurement, stomach through colon, wireless capsule, with interpretation and report 2.10 2.10 Finalize.
92083 Visual field examination, unilateral or bilateral, with interpretation and report; extended examination (eg, goldmann visual fields with at least 3 isopters plotted and static determination within the central 30¡, or quantitative, automated threshold perimetry, octopus program g-1, 32 or 42, humphrey visual field analyzer full threshold programs 30-2, 24-2, or 30/60-2) 0.50 0.50 Finalize.
92100 Serial tonometry (separate procedure) with multiple measurements of intraocular pressure over an extended time period with interpretation and report, same day (eg, diurnal curve or medical treatment of acute elevation of intraocular pressure) 0.61 0.61 Finalize.
92235 Fluorescein angiography (includes multiframe imaging) with interpretation and report 0.81 0.81 Finalize.
92286 Anterior segment imaging with interpretation and report; with specular microscopy and endothelial cell analysis 0.40 0.40 Finalize.
92920 Percutaneous transluminal coronary angioplasty; single major coronary artery or branch 10.10 10.10 Finalize.
92921 Percutaneous transluminal coronary angioplasty; each additional branch of a major coronary artery (list separately in addition to code for primary procedure) B B Finalize.
92924 Percutaneous transluminal coronary atherectomy, with coronary angioplasty when performed; single major coronary artery or branch 11.99 11.99 Finalize.
92925 Percutaneous transluminal coronary atherectomy, with coronary angioplasty when performed; each additional branch of a major coronary artery (list separately in addition to code for primary procedure) B B Finalize.
92928 Percutaneous transcatheter placement of intracoronary stent(s), with coronary angioplasty when performed; single major coronary artery or branch 11.21 11.21 Finalize.
92929 Percutaneous transcatheter placement of intracoronary stent(s), with coronary angioplasty when performed; each additional branch of a major coronary artery (list separately in addition to code for primary procedure) B B Finalize.
92933 Percutaneous transluminal coronary atherectomy, with intracoronary stent, with coronary angioplasty when performed; single major coronary artery or branch 12.54 12.54 Finalize.
92934 Percutaneous transluminal coronary atherectomy, with intracoronary stent, with coronary angioplasty when performed; each additional branch of a major coronary artery (list separately in addition to code for primary procedure) B B Finalize.
92937 Percutaneous transluminal revascularization of or through coronary artery bypass graft (internal mammary, free arterial, venous), any combination of intracoronary stent, atherectomy and angioplasty, including distal protection when performed; single vessel 11.20 11.20 Finalize.
92938 Percutaneous transluminal revascularization of or through coronary artery bypass graft (internal mammary, free arterial, venous), any combination of intracoronary stent, atherectomy and angioplasty, including distal protection when performed; each additional branch subtended by the bypass graft (list separately in addition to code for primary procedure) B B Finalize.
92941 Percutaneous transluminal revascularization of acute total/subtotal occlusion during acute myocardial infarction, coronary artery or coronary artery bypass graft, any combination of intracoronary stent, atherectomy and angioplasty, including aspiration thrombectomy when performed, single vessel 12.56 12.56 Finalize.
92943 Percutaneous transluminal revascularization of chronic total occlusion, coronary artery, coronary artery branch, or coronary artery bypass graft, any combination of intracoronary stent, atherectomy and angioplasty; single vessel 12.56 12.56 Finalize.
92944 Percutaneous transluminal revascularization of chronic total occlusion, coronary artery, coronary artery branch, or coronary artery bypass graft, any combination of intracoronary stent, atherectomy and angioplasty; each additional coronary artery, coronary artery branch, or bypass graft (list separately in addition to code for primary procedure) B B Finalize.
93015 Cardiovascular stress test using maximal or submaximal treadmill or bicycle exercise, continuous electrocardiographic monitoring, and/or pharmacological stress; with supervision, interpretation and report 0.75 0.75 Finalize.
93016 Cardiovascular stress test using maximal or submaximal treadmill or bicycle exercise, continuous electrocardiographic monitoring, and/or pharmacological stress; supervision only, without interpretation and report 0.45 0.45 Finalize.
93018 Cardiovascular stress test using maximal or submaximal treadmill or bicycle exercise, continuous electrocardiographic monitoring, and/or pharmacological stress; interpretation and report only 0.30 0.30 Finalize.
93308 Echocardiography, transthoracic, real-time with image documentation (2d), includes m-mode recording, when performed, follow-up or limited study 0.53 0.53 Finalize.
93653 Comprehensive electrophysiologic evaluation including insertion and repositioning of multiple electrode catheters with induction or attempted induction of an arrhythmia with right atrial pacing and recording, right ventricular pacing and recording, his recording with intracardiac catheter ablation of arrhythmogenic focus; with treatment of supraventricular tachycardia by ablation of fast or slow atrioventricular pathway, accessory atrioventricular connection, cavo-tricuspid isthmus or other single atrial focus or source of atrial re-entry 15.00 15.00 Finalize.
93654 Comprehensive electrophysiologic evaluation including insertion and repositioning of multiple electrode catheters with induction or attempted induction of an arrhythmia with right atrial pacing and recording, right ventricular pacing and recording, his recording with intracardiac catheter ablation of arrhythmogenic focus; with treatment of ventricular tachycardia or focus of ventricular ectopy including intracardiac electrophysiologic 3d mapping, when performed, and left ventricular pacing and recording, when performed 20.00 20.00 Finalize.
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) 7.50 7.50 Finalize.
93656 Comprehensive electrophysiologic evaluation including transseptal catheterizations, insertion and repositioning of multiple electrode catheters with induction or attempted induction of an arrhythmia with atrial recording and pacing, when possible, right ventricular pacing and recording, his bundle recording with intracardiac catheter ablation of arrhythmogenic focus, with treatment of atrial fibrillation by ablation by pulmonary vein isolation 20.02 20.02 Finalize.
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) 7.50 7.50 Finalize.
93925 Duplex scan of lower extremity arteries or arterial bypass grafts; complete bilateral study 0.80 0.80 Finalize.
93926 Duplex scan of lower extremity arteries or arterial bypass grafts; unilateral or limited study 0.50 0.50 Finalize.
93970 Duplex scan of extremity veins including responses to compression and other maneuvers; complete bilateral study 0.70 0.70 Finalize.
93971 Duplex scan of extremity veins including responses to compression and other maneuvers; unilateral or limited study 0.45 0.45 Finalize.
95017 Allergy testing, any combination of percutaneous (scratch, puncture, prick) and intracutaneous (intradermal), sequential and incremental, with venoms, immediate type reaction, including test interpretation and report, specify number of tests 0.07 0.07 Finalize.
95018 Allergy testing, any combination of percutaneous (scratch, puncture, prick) and intracutaneous (intradermal), sequential and incremental, with drugs or biologicals, immediate type reaction, including test interpretation and report, specify number of tests 0.14 0.14 Finalize.
95076 Ingestion challenge test (sequential and incremental ingestion of test items, eg, food, drug or other substance); initial 120 minutes of testing 1.50 1.50 Finalize.
95079 Ingestion challenge test (sequential and incremental ingestion of test items, eg, food, drug or other substance); each additional 60 minutes of testing (list separately in addition to code for primary procedure) 1.38 1.38 Finalize.
95782 Polysomnography; younger than 6 years, sleep staging with 4 or more additional parameters of sleep, attended by a technologist 2.60 2.60 Finalize.
95783 Polysomnography; younger than 6 years, sleep staging with 4 or more additional parameters of sleep, with initiation of continuous positive airway pressure therapy or bi-level ventilation, attended by a technologist 2.83 2.83 Finalize.
95860 Needle electromyography; 1 extremity with or without related paraspinal areas 0.96 0.96 Finalize.
95861 Needle electromyography; 2 extremities with or without related paraspinal areas 1.54 1.54 Finalize.
95863 Needle electromyography; 3 extremities with or without related paraspinal areas 1.87 1.87 Finalize.
95864 Needle electromyography; 4 extremities with or without related paraspinal areas 1.99 1.99 Finalize.
95865 Needle electromyography; larynx 1.57 1.57 Finalize.
95866 Needle electromyography; hemidiaphragm 1.25 1.25 Finalize.
95867 Needle electromyography; cranial nerve supplied muscle(s), unilateral 0.79 0.79 Finalize.
95868 Needle electromyography; cranial nerve supplied muscles, bilateral 1.18 1.18 Finalize.
95869 Needle electromyography; thoracic paraspinal muscles (excluding t1 or t12) 0.37 0.37 Finalize.
95870 Needle electromyography; limited study of muscles in 1 extremity or non-limb (axial) muscles (unilateral or bilateral), other than thoracic paraspinal, cranial nerve supplied muscles, or sphincters 0.37 0.37 Finalize.
95885 Needle electromyography, each extremity, with related paraspinal areas, when performed, done with nerve conduction, amplitude and latency/velocity study; limited (list separately in addition to code for primary procedure) 0.35 0.35 Finalize.
95886 Needle electromyography, each extremity, with related paraspinal areas, when performed, done with nerve conduction, amplitude and latency/velocity study; complete, five or more muscles studied, innervated by three or more nerves or four or more spinal levels (list separately in addition to code for primary procedure) 0.70 0.86 Finalize.
95887 Needle electromyography, non-extremity (cranial nerve supplied or axial) muscle(s) done with nerve conduction, amplitude and latency/velocity study (list separately in addition to code for primary procedure) 0.47 0.71 Finalize.
95905 Motor and/or sensory nerve conduction, using preconfigured electrode array(s), amplitude and latency/velocity study, each limb, includes f-wave study when performed, with interpretation and report 0.05 0.05 Finalize.
95907 Nerve conduction studies; 1-2 studies 1.00 1.00 Finalize.
95908 Nerve conduction studies; 3-4 studies 1.25 1.25 Finalize.
95909 Nerve conduction studies; 5-6 studies 1.50 1.50 Finalize.
95910 Nerve conduction studies; 7-8 studies 2.00 2.00 Finalize.
95911 Nerve conduction studies; 9-10 studies 2.50 2.50 Finalize.
95912 Nerve conduction studies; 11-12 studies 3.00 3.00 Finalize.
95913 Nerve conduction studies; 13 or more studies 3.56 3.56 Finalize.
95921 Testing of autonomic nervous system function; cardiovagal innervation (parasympathetic function), including 2 or more of the following: Heart rate response to deep breathing with recorded r-r interval, valsalva ratio, and 30:15 ratio 0.90 0.90 Finalize.
95922 Testing of autonomic nervous system function; vasomotor adrenergic innervation (sympathetic adrenergic function), including beat-to-beat blood pressure and r-r interval changes during valsalva maneuver and at least 5 minutes of passive tilt 0.96 0.96 Finalize.
95923 Testing of autonomic nervous system function; sudomotor, including 1 or more of the following: Quantitative sudomotor axon reflex test (qsart), silastic sweat imprint, thermoregulatory sweat test, and changes in sympathetic skin potential 0.90 0.90 Finalize.
95924 Testing of autonomic nervous system function; combined parasympathetic and sympathetic adrenergic function testing with at least 5 minutes of passive tilt 1.73 1.73 Finalize.
95925 Short-latency somatosensory evoked potential study, stimulation of any/all peripheral nerves or skin sites, recording from the central nervous system; in upper limbs 0.54 0.54 Finalize.
95926 Short-latency somatosensory evoked potential study, stimulation of any/all peripheral nerves or skin sites, recording from the central nervous system; in lower limbs 0.54 0.54 Finalize.
95928 Central motor evoked potential study (transcranial motor stimulation); upper limbs 1.50 1.50 Interim Final.
95929 Central motor evoked potential study (transcranial motor stimulation); lower limbs 1.50 1.50 Interim Final.
95938 Short-latency somatosensory evoked potential study, stimulation of any/all peripheral nerves or skin sites, recording from the central nervous system; in upper and lower limbs 0.86 0.86 Finalize.
95939 Central motor evoked potential study (transcranial motor stimulation); in upper and lower limbs 2.25 2.25 Finalize.
95940 Continuous intraoperative neurophysiology monitoring in the operating room, one on one monitoring requiring personal attendance, each 15 minutes (list separately in addition to code for primary procedure) 0.60 0.60 Finalize.
95941 Continuous intraoperative neurophysiology monitoring, from outside the operating room (remote or nearby) or for monitoring of more than one case while in the operating room, per hour (list separately in addition to code for primary procedure) I I Finalize.
95943 Simultaneous, independent, quantitative measures of both parasympathetic function and sympathetic function, based on time-frequency analysis of heart rate variability concurrent with time-frequency analysis of continuous respiratory activity, with mean heart rate and blood pressure measures, during rest, paced (deep) breathing, valsalva maneuvers, and head-up postural change C C Finalize.
96920 Laser treatment for inflammatory skin disease (psoriasis); total area less than 250 sq cm 1.15 1.15 Finalize.
96921 Laser treatment for inflammatory skin disease (psoriasis); 250 sq cm to 500 sq cm. 1.30 1.30 Finalize.
96922 Laser treatment for inflammatory skin disease (psoriasis); over 500 sq cm 2.10 2.10 Finalize.
97150 Therapeutic procedure(s), group (2 or more individuals) 0.65 0.29 Finalize.
99485 Supervision by a control physician of interfacility transport care of the critically ill or critically injured pediatric patient, 24 months of age or younger, includes two-way communication with transport team before transport, at the referring facility and during the transport, including data interpretation and report; first 30 minutes B B Finalize.
99486 Supervision by a control physician of interfacility transport care of the critically ill or critically injured pediatric patient, 24 months of age or younger, includes two-way communication with transport team before transport, at the referring facility and during the transport, including data interpretation and report; each additional 30 minutes (list separately in addition to code for primary procedure) B B Finalize.
99487 Complex chronic care coordination services; first hour of clinical staff time directed by a physician or other qualified health care professional with no face-to-face visit, per calendar month B B Finalize.
99488 Complex chronic care coordination services; first hour of clinical staff time directed by a physician or other qualified health care professional with one face-to-face visit, per calendar month B B Finalize.
99489 Complex chronic care coordination services; each additional 30 minutes of clinical staff time directed by a physician or other qualified health care professional, per calendar month (list separately in addition to code for primary procedure) B B Finalize.
99495 Transitional care management services with the following required elements: Communication (direct contact, telephone, electronic) with the patient and/or caregiver within 2 business days of discharge medical decision making of at least moderate complexity during the service period face-to-face visit, within 14 calendar days of discharge 2.11 2.11 Finalize.
99496 Transitional care management services with the following required elements: Communication (direct contact, telephone, electronic) with the patient and/or caregiver within 2 business days of discharge medical decision making of high complexity during the service period face-to-face visit, within 7 calendar days of discharge (do not report 90951-90970, 98960-98962, 98966-98969, 99071, 99078, 99080, 99090, 99091, 99339, 99340, 99358, 99359, 99363, 99364, 99366-99368, 99374-99380, 99441-99444, 99487-99489, 99605-99607 when performed during the service time of codes 99495 or 99496) 3.05 3.05 Finalize.
G0127 Trimming of dystrophic nails, any number 0.17 0.17 Finalize.
G0416 Surgical pathology, gross and microscopic examinations for prostate needle biopsy, any method, 10-20 specimens 3.09 3.09 Finalize.
G0452 Molecular pathology procedure; physician interpretation and report 0.37 0.37 Finalize.
G0453 Continuous intraoperative neurophysiology monitoring, from outside the operating room (remote or nearby), per patient, (attention directed exclusively to one patient) each 15 minutes (list in addition to primary procedure) 0.5 0.6 Finalize.
G0455 Preparation with instillation of fecal microbiota by any method, including assessment of donor specimen 0.97 1.34 Finalize.
G0456 Negative pressure wound therapy, (e.g. vacuum assisted drainage collection) using a mechanically-powered device, not durable medical equipment, including provision of cartridge and dressing(s), topical application(s), wound assessment, and instructions for ongoing care, per session; total wounds(s) surface area less than or equal to 50 square centimeters C C Finalize.
G0457 Negative pressure wound therapy, (e.g. vacuum assisted drainage collection) using a mechanically-powered device, not durable medical equipment, including provision of cartridge and dressing(s), topical application(s), wound assessment, and instructions for ongoing care, per session; total wounds(s) surface area greater than 50 square centimeters C C Finalize.

In the following section, we discuss all codes for which we received a comment on the CY 2013 interim final work value or time during the comment period for the CY 2013 final rule with comment period or codes for which we are modifying the work RVU or time. If a code in Table 24 is not discussed in this section, we did not receive any comments on that code and are finalizing the CY 2013 interim final value.

(1) Integumentary System: Skin, Subcutaneous, and Accessory Structures (CPT Code 10120)

As detailed in the CY 2013 final rule with comment period, CPT code 10120 had previously been identified as potentially misvalued using the Harvard-valued utilization over 30,000 screen. We assigned an interim final work RVU of 1.22 for CY 2013, which was slightly less than the AMA RUC-recommended value of 1.25. The AMA RUC recommendation was based upon survey results; however, we believed an RVU of 1.25 overstated the work of this procedure because some of the activities furnished during the postservice period of the procedure code overlapped with the E/M visit. The AMA RUC appropriately accounted for the overlap with the E/M visit in its recommendation of preservice time, but we believed the recommendation failed to account for the overlap in the postservice time. To account for this overlap, we used our standard methodology as described above. As noted in the CY 2013 final rule with comment period, we refined the time to equal 3 minutes in the postservice physician time for CPT code 10120 for CY 2013.

Comment: Commenters urged us to use the AMA RUC-recommended work value of 1.25 RVUs and postservice physician time of 5 minutes for CPT code 10120. Commenters stated that the AMA RUC conducted extensive review of Medicare claims data for services billed together and after discussing the potential overlap and explicitly determined physician time recommendations that did not include overlap with an E/M service. Since in their view, there was no overlap between the physician time and the E/M service, they recommended that we value the code as recommended by the AMA RUC.

Response: After re-review, we maintain that some of the activities conducted during the postservice time of the procedure code and the E/M visit overlap and, therefore, should not be counted twice in developing the procedure's work value. We continue to believe that the recommended postservice time should be reduced by one-third to account for this overlap. To calculate the time, we reduced the survey's median postservice time of 5 minutes by one-third, resulting in a reduction from 5 minutes to 3 minutes. As such, we also continue to believe that a work RVU of 1.22 accurately reflects the work of the service relative to similar services. Therefore, we are finalizing a work RVU of 1.22 for CPT code 10120 and the time refinement as established for CY 2014.

(2) Integumentary System: Skin, Subcutaneous, and Accessory Structures (CPT Codes 11302, 11306, 11310, 11311, 11312, and 11313)

For these codes, as we discussed in the CY 2013 final rule with comment period, we set the work RVUs at the survey's 25th percentile work RVUs as we believed this reflected the appropriate relativity of the services both within this family as well as relative to other PFS services. As noted in the CY 2013 final rule with comment period, our interim final values differed from the AMA RUC recommendation for CPT codes 11302, 11306, 11310, 11311, 11312 and11313.

Comment: Commenters expressed disappointment with our CY 2013 interim final values for CPT codes 11302, 11306, 11310, 11311, 11312, and 11313, but without providing reasons to support a higher value.

Response: We continue to believe that the survey's 25th percentile RVUs accurately reflect the work of these procedures relative to each other and relative to other procedures. Therefore, for CY 2014 we are finalizing the CY 2013 interim final work RVU values for CPT codes 11302, 11306, 11310, 11311, 11312 and 11313.

(3) Integumentary System: Repair (Closure) (CPT Codes 13132, 13150, 11351, and 13152)

For CY 2013, we received new recommendations from the AMA RUC for the complex wound repair family, including CPT codes 13132, 13150, 13151, and 13152. As we described in the CY 2013 final rule with comment period, we assigned CY 2013 interim final work RVUs consistent with AMA RUC recommendations for all the codes in this complex wound repair family, except CPT codes 13150 and 13152, as discussed below. We assigned the following CY 2013 interim final work RVUs: 4.78 for CPT code 13132, 3.58 for CPT code 13150, 4.34 for CPT code 13151 and 2.38 for CPT code 13153.

Comment: Commenters agreed with our interim final work RVUs of 4.78 for CPT code 13132 and 4.34 for CPT code 13151 and thanked us for accepting the AMA RUC-recommendations.

Response: We are finalizing work RVUs for CY 2014 of 4.78 for CPT code 13132 and 4.34 for CPT code 13151.

The AMA RUC did not provide a recommendation for CPT code 13150 for CY 2013 with the other codes in the family because it was expecting that code to be deleted for CY 2014. As we noted in the CY 2013 final rule with comment period, we believed it was appropriate to reduce the work RVU of CPT code 13150 proportionate to the reductions in work RVUs that the AMA RUC recommended and we adopted for other services in the family, so that we maintained appropriate proportionate rank order for CY 2013. For the 12 other CPT codes in the family, their CY 2012 work RVUs were reduced, on average, by 7 percent for CY 2013. Applying that reduction to the work RVU of CPT code 13150 resulted in a CY 2013 work RVU of 3.58. We believed that value appropriately reflected the work associated with the procedure and we assigned a CY 2013 interim final work RVU of 3.58 to CPT code 13150. This code will be deleted effective January 1, 2014.

As we noted in the CY 2013 final rule with comment period, after reviewing CPT code 13152, we believed that the AMA RUC-recommended work RVU of 5.34 was too high relative to similar CPT code 13132, which had an AMA RUC-recommended work RVU of 4.78, and CPT code 13151, which had an AMA RUC-recommended work RVU of 4.34. We believed that the survey's 25th percentile work RVU of 4.90 more appropriately reflected the relative work involved in furnishing the service. Therefore, we assigned a CY 2013 interim final work RVU of 4.90 for CPT code 13152.

Comment: Commenters disagreed with our relative comparison of CPT code 13152 to CPT codes 13132 and 13151. Commenters stated that the AMA RUC determined that the survey's 25th percentile work RVU of 4.90 was too low for CPT code 13152 and would cause a rank order anomaly when compared to the less intense CPT code 13132. One commenter cited the detailed rationale that they presented to the AMA RUC explaining how CPT code 13152 was more intense and complex to perform than CPT code 13132. Furthermore, commenters supported the AMA RUC-recommended direct crosswalk of CPT code 13152 to CPT code 36571, which has a work RVU of 5.34. Commenters requested that we use the AMA RUC-recommended work RVU of 5.34 for CPT code 13152.

Response: Based on comments received, we re-reviewed CPT code 13152 and agree based on the complexity and intensity of the service that CPT code 13152 is more appropriately directly crosswalked to CPT code 36571 which has a work RVU of 5.34. Therefore, we are finalizing the AMA RUC-recommended work RVU of 5.34 to CPT code 13152 for CY 2014.

(4) Arthrocentesis (CPT Code 20605)

In the CY 2013 final rule with comment period, we revised the direct PE inputs for CPT code 20605 (Arthrocentesis, aspiration and/or injection; intermediate joint or bursa (eg, temporomandibular, acromioclavicular, wrist, elbow or ankle, olecranon bursa)) and valued the code on an interim final basis for CY 2013. We had revised the work RVU for this code in CY 2012. In CY 2012, when we revised the work RVU, we established a value of 0.68 (76 FR 73209). However, in CY 2013 due to a data entry error, a work RVU of 0.98 was used for CPT 20605. Subsequent to the publication of the proposed rule, a stakeholder alerted us to a work RVU discrepancy for this code. The values displayed in Addenda B and C of the CY 2013 final rule with comment period reflect this error. In this final rule with comment period we are making a technical correction to the work RVU, revising it to 0.68, which is the work value we established in CY 2012.

(5) Musculoskeletal System: Spine (Vertebral Column) (CPT Code 22586)

CPT code 22586 was created by the CPT Editorial Panel effective January 1, CY 2013. As we noted in the CY 2013 final rule with comment period, after clinical review of CPT code 22586, we believed that a work RVU of 28.12 accurately accounted for the work associated with the service and assigned this as the CY 2013 interim final value. The AMA RUC did not provide a recommendation on this service because the specialty societies that would have needed to conduct a survey as part of the AMA RUC process declined to do so. We also noted that a specialty society that does not participate in the AMA RUC conducted a survey of its members, who furnish this service, regarding the work and time associated with this procedure and submitted a work RVU recommendation to CMS.

In the CY 2013 final rule with comment period we noted that in determining the appropriate value for this new CPT code, we reviewed the survey results and recommendations submitted to us, literature on the procedure, and Medicare claims data. Ultimately, we used a building block approach to value CPT code 22586. As we stated in the CY 2013 final rule with comment period, we valued CPT 22586 using CPT code 22558 as a reference service. CPT code 22558 is a similar procedure except that it does not include additional grafting, instrumentation, and fixation that are included in CPT code 22586. To assess the appropriate relative work increase from unbundled CPT code 22558 to the new bundled CPT code 22586, we used Medicare claims data to assess which grafting, instrumentation, and fixation services were commonly billed with CPT code 22558. Using these data we created a utilization-weighted work RVU for the grafting component of CPT code 22586, the instrumentation component of the 22586, and the fixation component of 22586. Adding these work RVUs to those of CPT code 22558 created a work RVU of 28.12, which we assigned as the CY 2013 interim final work RVU for CPT code 22586.

Additionally, as detailed in the CY 2013 final rule with comment period, after reviewing the physician time and post-operative visits for similar services, we concluded that this service includes 40 minutes of preservice evaluation time, 20 minutes of preservice positioning time, 20 minutes of preservice scrub, dress and wait time, 180 minutes of intraservice time, and 30 minutes of immediate postservice time. In the post-operative period, we believed that this service typically includes 2 CPT code 99231 visits, 1 CPT code 99323 visit, 1 CPT code 99238 visit, and 4 CPT code 99213 visits.

Comment: A commenter opposed our use of the building block methodology to value CPT code 22586, noting that we had used a methodology that digressed from our current standards for valuing procedures. Additionally, the commenter disagreed with our use of data from a specialty society that does not participate in the AMA RUC.

Response: To properly value this service without an AMA RUC recommendation, we believe that our evaluation of survey results, recommendations, literature, and Medicare claims data is crucial. Additionally, as we stated in the methodology section above and in previous final rules with comment periods, we believe the building block methodology is an appropriate approach to develop RVUs. We continue to believe the methodology used to develop the CY 2013 interim final work RVU using CPT code 22588 as the base reference is suitable for this code. Furthermore, we believe that the interim final work RVU accurately reflects the work of the typical case and reflects the appropriate incremental difference in work between CPT code 22588 and new CPT code 22586. Therefore, we are finalizing a work RVU of 28.12 for CPT code 22586 for CY 2014.

(6) Elbow Implant Removal (CPT Code 24160)

As detailed in the CY 2013 final rule with comment period, we maintained the current work value for CPT code 24160 based upon the AMA RUC recommendation. We received an AMA RUC recommendation for a work RVU of 18.63 based upon a revised CPT code description for this code. We agree with the AMA RUC recommendation and are assigning a CY 2014 interim final work RVU of 18.63 to CPT code 24160.

As detailed in the CY 2013 final rule with comment period, in response to comments we received in response to the CY 2012 final rule with comment period, we referred CPT code 29581 to the CY 2012 multi-specialty refinement panel for further review. The refinement panel median work RVU for CPT code 29581 was 0.50. Typically, we finalize the work values for CPT codes after reviewing the results of the refinement panel. However, for CY 2012 we assigned interim RVUs for CPT codes 29581, 29582, 29583, and 29584 and requested additional information, with the intention of re-reviewing the services for CY 2013 with the new information we had received, and setting interim final values at that time. After consideration of the public comments, refinement panel median value, and our clinical review, we continued to believe that a work RVU of 0.25 was appropriate for CPT code 29581. We recognized that CPT code 29581 received only editorial changes in CY 2012; however, we continued to believe the HCPAC-reviewed codes 29582, 29583, and 29584 describe similar services. While the services are performed by different specialties, they do involve similar work. Therefore, we continued to believe that crosswalking CPT code 29581 to CPT codes 29582, 29583 and 29584 was appropriate and that the resulting work RVU accurately reflected the work associated with the service. Accordingly, on an interim final basis for CY 2013, we assigned a work RVU of 0.25 to CPT code 29581; a work RVU of 0.35 to CPT code 29582; a work RVU of 0.25 to CPT code 29583; and a work RVU of 0.35 to CPT code 29584.

Comment: Commenters disagreed with our crosswalk of CPT 29581 to CPT codes 29582, 29583, and 29584. Commenters stated that it was incorrect to compare CPT code 29581 to the other codes in the family because the typical patient for CPT 29581, a patient with a recalcitrant venous ulcer, is entirely different and more complex than the typical patient for the other codes, and as a result, CPT 29581 is a more intense and time-consuming service. Therefore, commenters requested that we use the AMA RUC-recommended work RVU of 0.60 for CPT code 29581.

Response: After re-review of CPT code 29581, we maintain that a crosswalk to CPT codes 29582, 29583, and 29584 is appropriate because the services involve similar work and as such, should be valued relative to one another. Even though the typical patient for CPT code 29581 may be different than CPT codes 29582, 29583, and 29584, the work associated with the service is not necessarily different. Accordingly, we continue to believe that our recommended value accurately reflects the work of the procedure and are finalizing a work RVU of 0.25 for CPT code 29581 for CY 2014.

(8) Respiratory System: Accessory Sinuses (CPT Code 31231)

Previously, CPT code 31231 was identified for review because it was on the multispecialty points of comparison list. We assigned a CY 2013 interim final work RVU of 1.10 to CPT code 31231, which was the survey's 25th percentile value and the AMA RUC recommendation. We believed that some of the activities furnished during the preservice and postservice period of the procedure code and the E/M visit overlapped and, therefore, should not be counted twice in developing the procedure's work value. Although we believed the AMA RUC appropriately accounted for this overlap in its recommendation of preservice time, we believed they did not account for the overlap in the postservice time. To account for this overlap, we reduced the postservice time by one-third. Specifically, we reduced the postservice time from 5 minutes to 3 minutes.

Comment: Although commenters supported the use of the AMA RUC-recommended work RVU, they overwhelmingly disagreed with lowering the postservice time for CPT code 31231. Commenters stated that the AMA RUC valued CPT code 31231 through significant review of Medicare claims data for services billed together and deliberations on potential overlap, and determined physician time recommendations that did not include overlap with an E/M service. The commenters stated that none of the post-time allocated to this code overlapped with the E/M service. Therefore, commenters requested our acceptance of the AMA RUC-recommended postservice physician time of 5 minutes.

Response: After re-review, we maintain that some of the activities conducted during the postservice time of the procedure code and the E/M visit overlap and, therefore, should not be counted twice in developing the procedure's work value. To account for this overlap, we used our standard methodology as described above. Therefore, we are finalizing a refinement of postservice time and a work RVU of 1.10 for CPT code 31231 for CY 2014.

(9) Respiratory System: Trachea and Bronchi (CPT Codes 31647, 31648, 31649 and 31651)

Effective January 1, 2013, the CPT Editorial Panel created CPT codes 31647, 31648, 31649, and 31651 to replace 0250T, 0251T; and CPT codes 31660 and 31661 to replace 0276T and 0277T. As we noted in the CY 2013 final rule with comment period when we valued these codes for the first time, we assigned a work RVU of 4.40 to CPT code 31647; a work RVU of 4.20 to CPT code 31648; and a work RVU of 1.58 to CPT code 31651 on an interim final basis for CY 2013, based upon the AMA RUC recommendations for these codes.

Comment: Commenters agreed with our interim final work for these codes and thanked us for accepting the AMA RUC recommendations.

Response: We are finalizing work RVUs of 4.40 for CPT code 31647, 4.20 for CPT code 31648 and 1.58 for CPT code 31651 for CY 2014.

As we noted in the CY 2013 final rule with comment period, after clinical review, we did not agree with the AMA RUC-recommended work RVU of 2.00 for CPT code 31649. Since CPT code 31647 had a higher work RVU than CPT code 31648, we believed that to maintain the appropriate relativity between the services, the add-on code associated with CPT code 31647 (CPT code 31651) should have a higher RVU than the add-on code associated with CPT code 31648 (CPT code 31649). We believed that by valuing CPT code 31649 at the survey's 25th percentile work RVU of 1.44, the services were placed in the appropriate rank order. Therefore, we assigned a CY 2013 interim final work RVU of 1.44 to CPT code 31649.

Comment: Commenters urged us to use the AMA RUC-recommended work value of 2.00 for CPT code 31649 and requested that we refer the code to the refinement panel. They noted that proper relativity would have CPT code 31649 ranked higher than CPT code 31651 due to the fact that valve removal requires greater physician intensity and complexity compared to insertion.

Response: After evaluation of the request for refinement, we determined that the criteria for the request for refinement were not met and, as a result, we did not refer CPT code 31649 to the CY 2013 multi-specialty refinement panel for further review.

After re-review of the work RVUs for CPT code 31649 in light of the comments submitted, we maintain that our approach in valuing this procedure is appropriate. Additionally, during clinical re-review we examined in great detail the physician intensity and complexity involved in CPT code 31649 and believe that the survey's 25th percentile work RVU of 1.44 adequately captures these factors. Furthermore, we believe that the CY 2013 interim final work RVU accurately reflects the work of the typical case and reflects the appropriate incremental difference in work with CPT code 31651. Therefore, we are finalizing a work RVU of 1.44 for CPT code 31649 for CY 2014.

(10) Respiratory System: Lungs and Pleura (CPT Codes 32551 and 32557)

We assigned CPT code 32551 a CY 2013 interim final work RVU of 3.29. As we noted in the CY 2013 final rule with comment period, we did not believe that the 0.21 work RVU increase recommended by the AMA RUC based upon the survey's 25th percentile work RVU of 3.50 was warranted for this service, especially considering the substantial reduction in recommended physician time. Additionally, as we noted in the CY 2013 interim final rule with comment period, we believed that a work RVU of 3.29 placed this service in the appropriate rank order with the other similar CPT codes reviewed for CY 2013.

Comment: A commenter stated CPT code 32551 should have been assigned a higher work value than we assigned in CY 2013 and requested that we use the AMA RUC-recommended work value for the service. The commenter also pointed out that the work RVU value for 32551 was reduced a few years ago to account for the vast number of percutaneous catheter insertions billed with this code. Because the percutaneous placed catheters, which involve less work, have since been given their own code set, the commenter stated that the open chest tube insertion would be the only procedure for which CPT code 32551 could be used. As such, the commenter believed that if we accepted the idea that a “properly valued code can be split into less complex and intense (percutaneous catheter insertion) with lesser value and more complex and intense (32551, open thoracostomy) of greater value, [we] would have an appropriate rationale for accepting the RUC recommendations (25th percentile of the survey, 3.50 RVW) for 32551.”

Response: After review of the comments, we continue to believe that an increase in work RVU for CPT code 32551 is inappropriate, especially considering the substantial reduction in the AMA RUC-recommended physician time. Moreover, we believe that the work RVU of 3.29 accurately reflects the work of the typical case of this service. Therefore, we are finalizing a work RVU of 3.29 for CPT code 32551 for CY 2014.

As detailed in the CY 2013 final rule with comment period, CPT code 32557 was created as part of a coding restructure for this family. This code was assigned a CY 2013 interim final work RVU of 3.12 because we believed the AMA RUC-recommended work RVU of 3.62 overstated the difference between this code and CPT code 32556, which had an AMA RUC-recommended work RVU of 2.50. The specialty societies that surveyed CPT code 32556 recommended to the AMA RUC a work RVU of 3.00 for CPT code 32556 and a work RVU of 3.62 for CPT code 32557. We believed this difference of 0.62 in work RVUs between the two codes more accurately captured the relative difference between the services. Therefore, since we assigned CPT code 32556 a CY 2013 interim final work RVU of 2.50, we believed a work RVU of 3.12 reflected the appropriate difference between CPT codes 32556 and 32557 and appropriately reflected the work of CPT code 32557.

Additionally, in CY 2013, we refined the AMA RUC-recommended preservice evaluation time from 15 minutes to 13 minutes for CPT code 32557 to match the preservice evaluation time of CPT code 32556.

Comment: Commenters stated that we did not comprehend the relationship between the base code, CPT code 32556, without imaging, and CPT code 32557, with imaging, and the significant clinical differences in providing the services. Commenters disagreed with the way we determined the work RVU for CPT 32557 and stated that a better alternative for valuing CPT code 32557 would have been to add the value of CT guidance (1.19) to the non-image guided code (CPT code 32556 at 2.50 RVUs) to achieve the AMA RUC-recommended work RVU of 3.62. Therefore, commenters requested our use of the AMA RUC-recommended work value of 3.62 for CPT code 32557 and refinement panel review of the code.

Response: After evaluation of the request for refinement, we determined that the criteria for the request for refinement were not met and, as a result, we did not refer CPT code 32557 to the CY 2013 multi-specialty refinement panel for further review.

After re-review of CPT code 32557, we maintain that our approach in valuing this procedure is appropriate since the AMA RUC-recommended work RVU of 3.62 overstates the difference between CPT codes 32556 and 32557. We continue to believe that the difference in work RVUs presented to the AMA RUC by the specialty societies that surveyed CPT code 32557 is more appropriate in order to maintain relativity among the codes. Therefore, we are finalizing the refinement to time and the work RVU of 3.12 for CPT code 32557 for CY 2014.

(11) Respiratory System: Lungs and Pleura (CPT Codes 32663, 32668, 32669, 32670, 32671, 32672, and 32673)

The CPT Editorial Panel reviewed the lung resection family of codes and deleted 8 codes, revised 5 codes, and created 18 new codes for CY 2012. As detailed in the CY 2012 final rule with comment period, during our review for the CY 2012 PFS final rule with comment period, we were concerned with the varying differentials in the AMA RUC-recommended work RVUs and times between some of the open surgery lung resection codes and their endoscopic analogs. Rather than assign alternate interim final RVUs and times in this large restructured family of codes, we accepted the AMA RUC recommendations on an interim basis for CY 2012 and requested that the AMA RUC re-review the surgical services along with their endoscopic analogs.

In the CY 2012 PFS final rule with comment period we made this request. However, there was an inadvertent typographical error in our request, in that we referred to “open heart surgery analogs” instead of just “open surgery analogs” for each code. For example, we stated, “For CPT code 32663 (Thoracoscopy, surgical; with lobectomy (single lobe)), the AMA RUC recommended a work RVU of 24.64. Upon clinical review, we have determined that it is most appropriate to accept the AMA RUC-recommended work RVU of 24.64 on a provisional basis, pending review of the open heart surgery analogs, in this case CPT code 32480. We are requesting the AMA RUC look at the incremental difference in RVUs and times between the open and laparoscopic surgeries and recommend a consistent valuation of RVUs and time for CPT code 32663 and other services within this family with this same issue. Accordingly, we are assigning a work RVU of 24.64 for CPT code 32663 on an interim basis for CY 2012” (76 FR 73195). During the comment period on the CY 2012 final rule with comment period, the affected specialty societies and the AMA RUC responded to our request noting that the codes were not open heart surgery codes.

In the CY 2013 final rule with comment period, we acknowledged that our request would have been more clear if we had referred to “open surgery codes” instead of “open heart surgery codes” and if we had written “endoscopic procedures” instead of “laparoscopic surgeries.” With this clarification, we re-requested public comment on the appropriate work RVUs and time values for CPT codes 32663 and 32668-32673. For CY 2013, we maintained the following CY 2012 interim final values for these services as shown in Table 24.

Comment: A commenter stated that there was no apparent correlation between the endoscopic and open variations of the procedures and added that no further effort was needed to determine differences between the two approaches because “any such relationship would be spurious at best.” The commenter also stated that additional “exercises to establish consistent differences in work value according to surgical approach (when such relationships actually do not exist for clinical reasons)” are unnecessary.

Response: We continue to believe that our request for additional information on the relationship between open and endoscopic procedures was warranted. Because we received no additional information on this family, as requested, we are finalizing our CY 2013 interim final values for this family.

(12) Cardiovascular System: Heart and Pericardium (CPT Codes 33361, 33362, 33363, 33364, 33365, 33367, 33368, 33405, 33430, and 33533)

As detailed in the CY 2013 final rule with comment period, the CPT Editorial Panel deleted four Category III codes (0256T through 0259T) and created nine CPT codes (33361 through 33369) to report transcatheter aortic valve replacement (TAVR) procedures for CY 2012.

Like their predecessor Category III codes (0256T-0259T), the new Category I CPT codes 33361 through 33365 require the work of an interventional cardiologist and cardiothoracic surgeon to jointly participate in the intra-operative technical aspects of TAVR as co-surgeons. Claims processing instructions for the Coverage with Evidence Development (CED) (CR 7897 transmittal 2552) requires each physician to bill with modifier -62 indicating that the co-surgery payment applies. In this situation, Medicare pays each co-surgeon 62.5 percent of the fee schedule amount. The three add-on cardiopulmonary bypass support services (CPT codes 33367, 33368, and 33369) are only reported by the cardiothoracic surgeon; therefore the AMA RUC-recommended work RVUs for those services reflected only the work of one physician. The AMA RUC-recommended work RVUs for each of the co-surgery CPT codes (33361 through 33365) reflect the combined work of both physicians without any adjustment to reflect the co-surgery payment policy. As we noted in the CY 2013 final rule with comment period, we considered whether it was appropriate to continue our co-surgery payment policy at 62.5 percent of the physician fee schedule amount for each physician for these codes if the work value reflected 100 percent of the work for two physicians. Ultimately, we decided to set the work RVU values to reflect the total work of the procedures, and to continue to follow our co-surgery payment policy, which allows the services to be billed by two physicians in part because this was part of the payment policy established with the CED decision.

As we noted in the CY 2013 final rule with comment period, after clinical review of CPT code 33361, we believed that the survey's 25th percentile work RVU of 25.13 appropriately captured the total work of the service. The AMA RUC recommended the survey's median work RVU of 29.50. Regarding physician time, for CPT 33361, as well as CPT codes 33362 through 33364, we believed 45 minutes of preservice evaluation time, which was the survey median time, was more consistent with the work of this service than the AMA RUC-recommended preservice evaluation time of 50 minutes. Accordingly, we assigned a work RVU of 25.13 to CPT code 33361, with a refinement of 45 minutes of preservice evaluation time, on an interim final basis for CY 2013.

As we explained in the CY 2013 interim final rule with comment period, after clinical review of CPT code 33362, we believed that the survey's 25th percentile work RVU of 27.52 appropriately captured the total work of the service and assigned an interim final work RVU of 27.52. The AMA RUC recommended the survey median work RVU of 32.00. As with CPT code 33361, we believed 45 minutes of preservice evaluation time was more appropriate for this service than the AMA RUC recommended preservice evaluation time of 50 minutes. We therefore refined the preservice evaluation time to 45 minutes.

As we noted in the CY 2013 interim final rule with comment period, after clinical review of CPT code 33363, we believed that the survey's 25th percentile work RVU of 28.50 appropriately captured the total work of the service and assigned an interim final work RVU of 28.50. The AMA RUC recommended the survey median work RVU of 33.00. As with CPT codes 33361 and 33362, we believed 45 minutes of preservice evaluation time was more appropriate for this service than the AMA RUC recommended time of 50 minutes and we therefore refined the preservice evaluation time to 45 minutes.

As we noted in the CY 2013 final rule with comment period, after clinical review of CPT code 33364, we believed that the survey's 25th percentile work RVU of 30.00 more appropriately captured the total work of the service than the AMA RUC-recommended survey median work RVU of 34.87, and therefore, we established an interim final work RVU of 30.00. As with CPT codes 33361-33363, we also believed 45 minutes of preservice evaluation time was more appropriate for this service than the AMA RUC-recommended time of 50 minutes, and therefore, we refined the preservice evaluation time 45 minutes.

As we noted in the CY 2013 final rule with comment period, after clinical review of CPT code 33365, we believed a work RVU of 33.12 accurately reflected the work associated with this service rather than the survey's median work RVU of 37.50. We determined that the work associated with this service was similar to reference CPT code 33410, which has a work RVU of 46.41 and has a 90-day global period that includes inpatient hospital and office visits. Because CPT code 33365 had a 0-day global period that does not include post-operative visits, we calculated the value of the pre-operative and post-operative visits in the global period of CPT code 33410, which totaled 13.29 work RVUs, and subtracted that from the total work RVU of 46.41 for CPT code 33410 to determine the appropriate work RVU for CPT code 33365. With regard to time, we used the 50 minutes of preservice evaluation time because we believed that the procedure described by CPT code 33365 involves more preservice evaluation time than 33410 since it was performed by surgically opening the chest via median sternotomy. Accordingly, we assigned an interim final work RVU of 33.12 for CPT code 33365 for CY 2013.

Comment: Commenters disagreed with our use of the 25th percentile survey values for CPT codes 33361-33365 rather than the AMA RUC-recommended median survey values. Commenters stated that our valuation of CPT code 33365 was arbitrary and resulted in considerably undervalued work RVUs. They also asserted that our interim final work RVUs produced rank order anomalies, were inconsistent with the high level of intensity and complexity necessitated by the procedures, and undervalued the procedures for each physician. Additionally, commenters provided examples comparing the AMA RUC recommendations and the interim final work RVUs for CPT codes 33361-33365 to other codes that were recently valued. In providing the examples, commenters made an effort to demonstrate that, by comparing CPT codes 33361-33365 to active comparable CPT codes and through proration of the physician time, it was apparent that the work RVUs for CPT codes 33361-33365 should be increased. Commenters therefore requested we use the AMA RUC-recommended work values of 29.50 for CPT code 33361, 32.00 for CPT code 33362, 33.00 for CPT code 33363, 34.87 for CPT code 33364 and 37.50 for CPT code 33365 and submit the code series to the refinement panel for review.

Response: After evaluation of the request for refinement, we determined that the criteria for the request for refinement were not met and, as a result, we did not refer CPT codes 33361-33365 to the CY 2013 multi-specialty refinement panel for further review.

After consideration of the comments on CPT codes 33361-33365, we maintain that our approach in valuing these procedures is appropriate. We believe that the AMA RUC-recommended work RVUs overstate the intensity and physician time in this family. We also believe that setting the work RVU values of these services to reflect the total work of the procedures is appropriate. This decision is also consistent with our co-surgery payment policy, which allows the services to be billed by two physicians. While many commenters objected to this rationale, we believe that their comparisons of CPT codes 33361-33365, services that require the work of two physicians, to codes where only one physician is performing the work are inappropriate. We continue to believe that the interim final work RVUs that we established in the CY 2013 final rule with comment period accurately reflect the work of the typical case of this service. Therefore, for CY 2014, we are finalizing the interim final work RVUs for CPT codes 33361-33365. We are also finalizing the following refinements to time for CY 2014: 45 minutes of preservice evaluation for CPT codes 33361-33364; and 50 minutes of preservice evaluation for CPT code 33365.

Comment: Commenters specifically agreed with our interim final work RVUs of 11.88 for CPT code 33367 and 14.39 to CPT code 33368 and thanked us for using the AMA RUC recommendations.

Response: We are finalizing the work RVUs of 11.88 to CPT code 33367 and 14.39 to CPT code 33368 for CY 2014.

As detailed in the CY 2013 final rule with comment period, CPT codes 33405, 33430, and 33533 were previously identified as potentially misvalued through the high expenditure procedure code screen. When reviewing the services, the specialty society utilized data from the Society of Thoracic Surgeons (STS) National Adult Cardiac Database in developing recommended times and work RVUs for CPT codes 33405, 33430 and 33533 rather than conducting a survey of work and time. After reviewing the mean procedure times for the services in the STS database alongside other information relating to the value of the services, the AMA RUC concluded that CPT codes 33405 and 33430 were appropriately valued and, accordingly, the CY 2012 RVUs of 41.32 for CPT code 33405, and 50.93 for CPT code 33430 should be maintained, and that the work associated with CPT code 33553 had increased since the service was last reviewed. The AMA RUC recommended a work RVU of 34.98 for CPT code 33533, which is a direct crosswalk to CPT code 33510.

As we noted in the CY 2013 final rule with comment period (77 FR 69049), we believed the STS database, which captures outcome data in addition to time and visit data, is a useful resource in the valuation of services. However, we remain interested in additional data from the STS database that might help provide context to the reported information. The AMA RUC recommendations on the services showed only the STS database mean time for CPT codes 33405, 33430, and 33533. We noted in the CY 2013 final rule with comment period that we were interested in seeing the distribution of times for the 25th percentile, median, and 75th percentile values, in addition to any other information STS believed would be relevant to the valuation of the services. For CY 2013, we assigned interim final work RVUs for the services, pending receipt of additional time data. Specifically, we maintained the CY 2012 work RVU values of 41.32 for CPT code 33405; 50.93 for CPT code 33430; and 33.75 for CPT code 33533.

Comment: STS requested a higher work value of CPT code 33533 and also disagreed with the AMA RUC recommendation. In its opinion, “the RUC recommendation is not consistent with the process and alters the intensity of 33533 contrary to the RUC rationale.” In contrast, the AMA RUC stated that the AMA RUC work value recommendation was most appropriate and asked that we submit the code for refinement panel review.

In response to our request for additional information regarding times from the STS database, all commenters declined to provide further information, stating that sufficient time data and explanations for the methodology associated with utilization of the database were provided to both the AMA RUC and CMS. STS further expressed its disinterest in providing additional information by noting that the supplementary data that we requested, the median or 25th percentile statistical descriptors, would “systematically exclude known physician work from consideration in code valuation, and if utilized would result in undervaluation relative to the remainder of the Physician Fee Schedule.”

Response: After evaluation of the request for refinement, we determined that the criteria for the request for refinement were not met and, as a result, we did not refer CPT code 33533 to the CY 2013 multi-specialty refinement panel for further review.

After re-review of CPT codes 33405, 33430 and 33533, we maintain that our approach in valuing these procedures is appropriate. In the CY 2013 final rule with comment period, we expressed our concern with the data derived from the STS database and our desire to receive additional information regarding the distribution of times and varying RVUs, for the 25th percentile, median, and 75th percentile values, in order to better value the services. We did not receive additional information from either STS or the AMA RUC regarding these procedures. In the absence of this information, we continue to believe that the CY 2013 interim final work RVUs for CPT codes 33405, 33430 and 33533 reflect the work of the typical case of these services. Therefore, we are finalizing the work RVUs of 41.32 for CPT code 33405, 50.93 for CPT code 33430 and 33.75 for CPT code 33533 for CY 2014.

(13) Cardiovascular System: Arteries and Veins (CPT Codes 35475, 35476, 36221-36227)

In the CY 2013 final rule with comment period, after clinical review of CPT code 35475, we established a work RVU of 5.75 to appropriately capture the work of the service. The AMA RUC, rather than using the survey, used a building block approach based on comparison CPT code 37224, which has a work RVU of 9.00, and recommended a work RVU of 6.60. The AMA RUC acknowledged that CPT code 35475 was typically reported with other services. We determined that the appropriate crosswalk for this code was CPT code 37220, which has a work RVU of 8.15. After accounting for overlap with other services, we determined that a work RVU of 5.75 was appropriate for the service. Accordingly, we assigned a work RVU of 5.75 to CPT code 35475 on an interim final basis for CY 2013.

After clinical review of CPT code 35476, we assigned a work RVU of 4.71 to the service in the CY 2013 final rule with comment period. The AMA RUC had recommended a work RVU of 5.10, based on the survey's 25th percentile value. We determined that the work associated with CPT code 35476 was similar in terms of physician time and intensity to CPT code 37191, which had a work RVU of 4.71. We believed the work RVU of 4.71 appropriately captured the relative difference between the service and CPT code 35475. Therefore, we assigned a work RVU of 4.71 for CPT code 35476 on an interim final basis for CY 2013.

Comment: Commenters universally disagreed with our reference codes for CPT codes 35475 and 35476. They stated that our comparison of CPT code 35475 to CPT code 37224 did not fully consider intensity or complexity of CPT code 35475, such as the need for a physician to perform catheter manipulation or traverse multiple vessels. They also stated that our comparison of CPT code 35476 to CPT code 37220 was inappropriate because the latter procedure was related to a service in a lower flow vein and, thus, using this crosswalk did not account for the service's work intensity or complexity, including the risk associated with angioplasty. Commenters believed that the comparison codes utilized by the AMA RUC in its recommended valuation, CPT codes 37224 and 37220, had a more comparable level of difficulty to CPT codes 35475 and 35476, respectively, than the codes we used. Additionally, commenters were concerned on a broader policy basis that the interim final values would compromise both the vascular access care provided to chronic kidney disease patients and specialty programs. For those reasons, commenters requested our use of the AMA RUC-recommended work RVUs of 6.60 for CPT code 35475 and 5.10 for CPT code 35476 and refinement panel review of the codes.

Response: We referred CPT codes 35475 and 35476 to the CY 2013 multi-specialty refinement panel for further consideration because the requirements for refinement panel review were met. The refinement panel median work RVU for CPT codes 35475 and 35476 were 6.60 and 5.10, respectively. After reevaluation, we are finalizing work RVUs of 6.60 for CPT code 35475 and 5.10 for CPT code 35476, based upon the refinement panel median.

In the CY 2013 final rule with comment period we assigned CPT code 36221 an interim final work RVU of 4.17 and refined the postservice to 30 minutes. The AMA RUC recommended a work RVU of 4.51 and a postservice time of 40 minutes using a direct crosswalk to the two component codes being bundled, CPT code 32600, which has a work RVU of 3.02, and CPT code 75650, which has a work RVU of 1.49. As we noted in the CY 2013 final rule with comment period, we believed that that there were efficiencies gained when services were bundled and that crosswalking to the work RVU of CPT code 32550, which had a work RVU of 4.17, appropriately accounted for the physician time and intensity with CPT code 36221. Additionally, we believed that the survey's postservice time of 30 minutes more accurately accounted for the time involved in furnishing the service than the AMA RUC-recommended postservice time of 40 minutes.

In the CY 2013 final rule with comment period we noted that after clinical review of CPT code 36222, we believed the survey 25th percentile work RVU of 5.53 appropriately captured the work of the service, particularly the efficiencies when two services were bundled together. The AMA RUC recommended the survey median work RVU of 6.00. Like CPT code 36221, we believed the survey's postservice time of 30 minutes was more appropriate than the AMA RUC-recommended postservice time of 40 minutes. We assigned a work RVU of 5.53 with refinement to time for CPT code 36222 as interim final for CY 2013.

In the CY 2013 final rule, we noted that after clinical review of CPT code 36223, we assigned an interim final work RVU value of 6.00, the survey's 25th percentile value, because we believed it appropriately captured the work of the service, particularly efficiencies when two services were bundled together. The AMA RUC reviewed the survey results, and after a comparison to similar CPT codes, recommended a work RVU of 6.50. Like many other codes in the family, we believed the survey's postservice time of 30 minutes was more appropriate than the AMA RUC-recommended time of 40 minutes and refined the time accordingly.

In the CY 2013 final rule, we noted that after clinical review of CPT code 36224, we believed a work RVU of 6.50, the survey's 25th percentile value, appropriately captured the work of the service, particularly, efficiencies when two services were bundled together. We believed 30 minutes of postservice time more appropriately accounted for the work of the service. The AMA RUC reviewed the survey results, and after a comparison to similar CPT codes, recommended a value of 7.55 and a postservice time of 40 minutes for CPT code 36224. Accordingly, we assigned a work RVU of 6.50 with refinement to time for CPT code 36224 as interim final for CY 2013.

In the CY 2013 final rule, we noted that after clinical review of CPT code 36225, we believed it should be valued the same as the CPT code 36223, which was assigned an interim final work RVU of 6.00. Comparable to CPT code 36223, we also believed 30 minutes of postservice time more appropriately accounted for the work of the service and refined the time accordingly. The AMA RUC reviewed the survey results and recommended the survey's median work RVU of 6.50 and a postservice time of 40 minutes for CPT code 36225.

In the CY 2013 final rule (77 FR 69051), we noted that after clinical review of CPT code 36226, we believed it should be valued the same as CPT code 36224, which was assigned work RVU of 6.50. Comparable to CPT code 36224, we believed 30 minutes of postservice time more appropriately accounted for the work of the service. The AMA RUC reviewed the survey results, and after a comparison to similar CPT codes, recommended a value of 7.55 and a postservice time of 40 minutes for CPT code 36226. We assigned a work RVU of 6.50 with refinement to time for CPT code 36226 as interim final for CY 2013.

In the CY 2013 final rule, we noted that after clinical review of CPT code 36227, we determined that efficiencies were gained when services were bundled, and identified a work RVU of 2.09 for the service. A 2.09 work RVU reflected the application of a very conservative estimate of 10 percent for the work efficiencies that we expected to occur when multiple component codes were bundled together to the sum of the work RVUs for the component codes. The AMA RUC reviewed the survey results, and after a comparison to similar CPT codes, recommended a value of 2.32 for CPT code 36227. The AMA RUC used a direct crosswalk to the two component codes being bundled, CPT code 36218, which has a work RVU of 1.01, and CPT code 75660, which has a work RVU of 1.31. We assigned a CY 2013 interim final work RVU of 2.09.

Comment: Commenters stated that the AMA RUC-recommended work RVUs captured all of the efficiencies that were achieved by bundling the services and that our conclusion that these codes values should further be lowered was unsupported and would produce rank order anomalies among intervention services. Some stated that for CPT codes 36222, 36223, 36224, 36225 and 36226, the AMA RUC-recommended values represented a considerable savings to the Medicare system. Commenters acknowledged that it may be true that efficiencies occur when surgical codes are bundled with other surgical codes or radiologic supervision and interpretation (S&I) codes are bundled with other S&I codes. However, commenters stated that CPT codes 36221 and 36227 reflects the bundling of surgical codes with S&I codes and, that since the activities of surgical codes and S&I codes are, by definition, separate, they disagreed that efficiencies should be assumed. Furthermore, commenters stated that it was incorrect for us to directly crosswalk to other procedures, such as CPT codes 32550, 36251 and 36253, which are easier in nature and entail less risk and less image interpretation, when more parallel crosswalks existed. As such, commenters supported the direct crosswalks and the following recommended work RVUs provided by the AMA RUC: 4.51 for CPT code 36221, 6.00 for CPT code 36222, 6.50 for CPT code 36223, 7.55 for CPT code 36224, 6.50 for CPT code 36225, 7.55 for CPT code 36226 and 2.32 for CPT code 36227 and requested refinement panel review of the codes.

Response: After evaluation of the request for refinement, we determined that the criteria for the request for refinement were not met and, as a result, we did not refer the codes to the CY 2013 multi-specialty refinement panel for further review.

After re-review of CPT codes 36221-36227, we maintain that the recommended direct crosswalks for these services are appropriate because the codes involve similar work and, as such, should be valued relative to one another. We also disagree with the commenters that efficiencies do not occur when surgical codes and S&I codes are bundled. Therefore, we are finalizing the CY 2013 interim final values for CY 2014 for CPT codes 36221-36227. We are also finalizing the postservice time refinement of 30 minutes to CPT codes 36221-36226 for CY 2014.

(14) Cardiovascular System: Arteries and Veins (CPT Codes 37197 and 37214)

As we noted in the CY 2013 final rule with comment period, we crosswalked the physician time and intensity of CPT code 36247 to CPT code 37197, resulting in a CY 2013 interim final work RVU of 6.29 for CPT code 37197. The AMA RUC had recommended a work RVU of 6.72 for CPT code 37197.

For the CY 2013 final rule with comment period, we assigned an interim final work RVU of 2.74 to CPT code 37214. In making its recommendation, the AMA RUC reviewed the survey results, and after a comparison to similar CPT codes, recommended a work RVU of 3.04 to CPT code 37214. After clinical review, we determined that there were efficiencies gained when services were bundled and ultimately used a very conservative estimate of 10 percent for the work efficiencies we expected to occur when multiple component codes were bundled. Specifically, we decreased the AMA RUC-recommended work RVU value of 3.04 by 10 percent to produce the work RVU value of 2.74, which we assigned as the CY 2103 an interim final work RVU for CPT code 37214.

Comment: Commenters disagreed with these interim final values and suggested that we finalize the AMA RUC-recommended work RVUs of 6.72 for CPT code 37197 and 3.04 for CPT code 37214 because the services are more intense and complex than accounted for by the CY 2013 interim final values. Additionally, several commenters alerted us to our oversight in not providing a written rationale for our work RVU values for CPT codes 37197 and 37214 and as result, requested a technical correction.

Response: The commenters are correct that we did not include a rationale to explain how we reached the interim final work values for these codes in the CY 2013 final rule with comment period. However, Table 30 “Work RVUs for CY 2013 New, Revised and Potentially Misvalued Codes” in the CY 2013 final rule with comment period clearly identified the interim final values being assigned to these codes. It also included the AMA RUC recommendations, denoted whether we agreed with the AMA RUC recommendations, and indicated whether we refined the times recommended by the AMA RUC.

Based upon the comments received, we re-reviewed CPT codes 37197 and 37214. Based upon our review, we believe that directly crosswalking CPT code 37197 to CPT code 36247 and reducing CPT code 37214 by a conservative 10 percent to account for efficiencies gained when services are bundled are appropriate to establish values for these services and produce RVUs that fully reflect the typical work and intensity of the procedures. Therefore, we are finalizing the work RVU of 6.29 for CPT code 37197 and 2.74 for CPT code 37214 for CY 2014.

(15) Hemic and Lymphatic System: General (CPT Codes 38240 and 38241)

In the CY 2013 final rule, we noted that after review, we believed CPT code 38240 should have the same work RVU as CPT code 38241 because the two services involved the same amount of work. The AMA RUC recommended a work RVU of 4.00 for CPT code 38240 and 3.00 for CPT code 38241. On an interim final basis for CY 2013 we assigned CPT code 38240 a work RVU of 3.00 and agreed with the AMA RUC recommendation of 3.00 for CPT code 38241.

Comment: Commenters specifically opposed our comparison of work for CPT code 38240 to CPT code 38241, stating that CPT code 38240 was much more complicated, intense and time consuming than CPT code 38241 and, as a result, should have a higher work RVU. Commenters also indicated that CPT 38240 has become more difficult to perform in recent years. Therefore, commenters requested that we use the AMA RUC-recommended work RVU of 4.00 for CPT code 38240 and maintain the interim final value of RVU of 3.00 for CPT code 38241. Commenters asked that both codes be referred to the refinement panel.

Response: After evaluation of the request for refinement, we determined that the criteria for the request for refinement were not met and, as a result, we did not refer CPT codes 38240 and 38241 to the CY 2013 multi-specialty refinement panel for further review.

Based on comments received, we re-reviewed the codes and agree that CPT code 38240 is a more involved and intense procedure than CPT code 38241 and as a result, should have a higher RVU valuation for work than the CY 2013 interim final work RVU. Therefore, we are finalizing the AMA RUC-recommended work RVU for 4.00 to CPT code 38240 and 3.00 for CPT code 38241 for CY 2014.

(16) Digestive System: Lips (CPT Code 40490)

As detailed in the CY 2013 final rule with comment period, we assigned an interim final work RVU of 1.22 to CPT code 40490, as recommended by the AMA RUC.

Comment: Commenters agreed and expressed appreciation with our use of the AMA RUC-recommended value.

Response: We are finalizing a work RVU of 1.22 for CPT code 40490 for CY 2014.

(17) Gastrointestinal (GI) Endoscopy (CPT Codes 43206 and 43252)

As detailed in the CY 2013 final rule with comment period, CPT codes 43206 and 43252 were contractor priced on an interim final basis. As part of its review of all gastrointestinal endoscopy codes, we received recommendations from the AMA RUC for a work RVU of 2.39 for CPT code 43206 and 3.06 for CPT code 43252. Based upon these recommendations we have the data necessary to establish RVUs and so are assigning CY 2014 interim final work RVUs of 2.39 for CPT code 43206 and 3.06 for CPT code 43252.

As detailed in the CY 2013 final rule with comment period, we assigned an interim final work RVU of 3.20 to CPT code 52287 as recommended by the AMA RUC.

Comment: A specialty association disagreed with our use of the AMA RUC work RVU recommendation for CPT code 52287. The commenter supported the survey's use of CPT code 51715 as the key reference code for this service, but stated that CPT code 52287 should have, at a minimum, the same RVU as CPT code 51715 because CPT code 52287 requires more injections and, as a result, a higher level of technical skill and more time. Therefore, the commenter requested that we accept a work RVU recommendation of 3.79 for CPT code 52287.

Response: After re-review of CPT code 52287, we maintain that our interim final value based upon the AMA RUC recommendation is appropriate. We note that the key reference service CPT code 51715 has more intraservice time (45 minutes) than CPT code 52287 (21 minutes), contrary to the commenter's assertion. We continue to believe that a RVU of 3.20 accurately and fully captures the work required for this service. Therefore, we are finalizing a work RVU of 3.20 for CPT code 52287 for CY 2014.

(19) Urinary System: Bladder (CPT Code 52353)

We assigned a CY 2013 interim final work RVU of 7.50 for CPT code 52353. As detailed in the CY 2013 final rule with comment period, after clinical review, we determined that the survey's 25th percentile work RVU represented a more appropriate incremental difference over the base code, CPT code 52351, than the AMA RUC-recommended work RVU of 7.88. Additionally, we believed the survey 25th percentile work RVU more appropriately accounted for the significant reduction in intraservice time from the current value.

Comment: Commenters objected to our reduction in the work RVU from the CY 2012 value and stated that we should use the AMA RUC-recommended work RVU of 7.88. Commenters said that the skills, effort, and time of CPT 52353 were more intense than those of CPT code 52351 and our value did not provide the fully warranted differential between the two codes. Additionally, commenters initially requested refinement panel review of CPT code 52353, but later withdrew their request.

Response: Based on comments received, we re-reviewed CPT code 52353 and continue to believe that our interim final work value is appropriate. We maintain that the survey's 25th percentile work RVU appropriately accounts for the work of this service, especially given the significant reduction in intraservice time and the lack of evidence that the intensity of this procedure has increased. We also believe that the interim final work value appropriately provides an incremental difference over the base CPT code 52351. For these reasons, we are finalizing a work RVU of 7.50 to CPT code 52353 for CY 2014.

(20) Nervous System: Extracranial Nerves, Peripheral Nerves, and Autonomic Nervous System (CPT Code 64615)

The CPT Editorial Panel created CPT code 64615 effective January 1, 2013. The AMA RUC recommended a work RVU of 1.85 and we agreed with the recommendation.

The AMA RUC also requested a decrease in the global period from 10 days to 0 days. As we noted in the CY 2013 final rule, we assigned CPT 64615 a global period of 10 days to maintain consistency within the family of codes.

Comment: Commenters stated that the assigned 10-day global period was not appropriate because there are no E/M post-operative visits related to the service, and accordingly, a 0-day global period would correctly reflect the work involved in, and valuation of, the service. Additionally, commenters noted that the 10-day global period was inconsistent with the 0-day global period we adopted for other services within the family. Commenters requested that we accept the AMA RUC-recommended global period of 0 days.

Response: Based on comments received, we re-reviewed CPT code 64615 and continue to believe that a 10-day global period is appropriate. Given that most of the other services within this family of CPT codes also have 10-day global periods, we continue to believe that a 10-day global period is appropriate for CPT code 64615. Furthermore, while there are other chemodenerveration codes in other areas of the body that do have 0-day global periods, we continue to believe that a 10-day global period for CPT code 64615 is appropriate in this anatomical region. Therefore, we are finalizing the work RVU of 1.85 for CPT code 64615, with a 10-day global period, for CY 2014.

(21) Eye and Ocular Adnexa: Eyeball (CPT Code 65222)

CPT code 65222 was identified as potentially misvalued under the Harvard-valued utilization over 30,000 screen. As we noted in the CY 2013 final rule with comment period, we assigned a work RVU of 0.84 to CPT code 65222, as well as a refinement to the AMA RUC-recommended time. Medicare claims data from 2011 indicated that CPT code 65222 was typically furnished to the beneficiary on the same day as an E/M visit. We believed that some of the activities furnished during the preservice and postservice period overlapped with the E/M visit. We did not believe that the AMA RUC appropriately accounted for this overlap in its recommendation of preservice and postservice time. To account for this overlap, we reduced the AMA RUC-recommended preservice evaluation time by one-third, from 7 minutes to 5 minutes, and the AMA RUC-recommended postservice time by one-third, from 5 minutes to 3 minutes. We believed that 5 minutes of preservice evaluation time and 3 minutes of postservice time accurately reflected the time involved in furnishing the preservice and postservice work of the procedure, and that those times were well-aligned with similar services.

Comment: Commenters disagreed with our work RVU and time refinement for CPT code 65222, stating that they were arbitrary in nature and based on an incorrect assumption that the overlap between the E/M visit and the preservice and postservice periods were not properly accounted for in the AMA RUC recommendation. Commenters stated that the AMA RUC did take the overlap into consideration and correctly accounted for it through a decrease in the preservice time from the specialty society survey determined time of 13 minutes to 7 minutes. Therefore, commenters requested that we accept the AMA RUC recommendation of a 0.93 work RVU with 7 minutes of preservice time and 5 minutes of postservice time.

Response: Based on comments received, we re-reviewed CPT code 65222 and continue to believe that our interim final work RVU of 0.84 is appropriate. We maintain that the AMA RUC did not fully account for the fact that some of the activities furnished during the preservice and postservice period of the procedure code overlap with those for the E/M visit, making the preservice time reductions recommended by the AMA RUC insufficient. As such, we continue to believe that 5 minutes of preservice evaluation time and 3 minutes of postservice time accurately reflect the physician time involved in furnishing the preservice and postservice work of this procedure, and that these times are well-aligned with similar services. Therefore, we are finalizing a work RVU of 0.84 to CPT code 65222 with 5 minutes of preservice evaluation time and 3 minutes of postservice, for CY 2014.

(22) Eye and Ocular Adnexa: Ocular Adnexa (CPT Code 67810)

CPT code 67810 was identified as potentially misvalued under the Harvard-valued utilization over 30,000 screen. On an interim final basis for CY 2013, we assigned the AMA RUC-recommended work RVU of 1.18 to CPT code 67810, with a refinement to the AMA RUC-recommended time. As we noted in the CY 2013 final rule with comment period, Medicare claims data from CY 2011 indicated that CPT code 67810 was typically furnished to the beneficiary on the same day as an E/M visit. We noted that that some of the activities furnished during the preservice and postservice period of the procedure code and the E/M visit overlapped and that although the AMA RUC appropriately accounted for this overlap in its recommendation of preservice time, its recommendation for postservice time was high relative to similar services performed on the same day as an E/M service. To better account for the overlap in the postservice period, and to value the service relative to similar services, we reduced the AMA RUC-recommended postservice time for this procedure by one-third, from 5 minutes to 3 minutes.

Comment: Commenters believed that our time refinement for CPT code 67810 was unsubstantiated and that we were incorrect in assuming that the overlap between the E/M visit and the postservice period was not appropriately accounted for in the AMA RUC recommendation. Commenters suggested that the AMA RUC did take the overlap into consideration and appropriately accounted for it by lowering the time recommendations by nearly 50 percent. Therefore, commenters requested that we accept the AMA RUC-recommended postservice time of 5 minutes for CPT code 67810.

Response: Based on comments received, we re-reviewed CPT code 67810 and continue to believe that our interim final work RVU of 1.18 and our time refinement is appropriate. We maintain that the AMA RUC did not fully account for the fact that some of the activities furnished during the postservice period of the procedure code overlap with the E/M visit and that the AMA RUC's time refinements were insufficient. As such, we continue to believe that 3 minutes of postservice time accurately reflects the physician time involved in furnishing the postservice work of this procedure, and that this time is well-aligned with that for similar services. Therefore, we are finalizing a work RVU of 1.18 to CPT code 67810 with 3 minutes of postservice time for CY 2014.

(23) Eye and Ocular Adnexa: Conjunctiva (CPT Code 68200)

CPT code 68200 was identified as potentially misvalued under the Harvard-valued utilization over 30,000 screen. On an interim final basis for CY 2013, we assigned a work RVU of 0.49 to CPT code 68200, with a refinement to the AMA RUC-recommended time. As we noted in the CY 2013 final rule with comment period, Medicare claims data from CY 2011 indicated that CPT code 68200 was typically furnished to the beneficiary on the same day as an E/M visit. We believed that some of the activities furnished during the preservice and postservice period of the procedure code overlapped with the E/M visit. We believed that the AMA RUC appropriately accounted for this overlap in its recommendation of preservice time, but did not adequately account for the overlap in the postservice time. To better account for the overlap in postservice time, we reduced the AMA RUC-recommended postservice time for this procedure by one-third, from 5 minutes to 3 minutes. After reviewing CPT code 68200 and assessing the overlap in time and work, we agreed with the AMA RUC-recommended work RVU of 0.49 for CY 2013.

Comment: Commenters believed that our time refinement for CPT code 68200 was unsupported and that we assumed incorrectly that the overlap between the E/M visit and the postservice period was not appropriately accounted for in the AMA RUC recommendation. Commenters suggested that the AMA RUC did take the overlap into consideration and completely accounted for it by lowering the preservice time recommendation. Therefore, commenters request that we accept the AMA RUC-recommended postservice time of 5 minutes postservice for CPT code 68200.

Response: After reviewing the comments, we continue to believe that our refinement of the recommended time is appropriate. We maintain that the AMA RUC did not fully account for the fact that some of the activities furnished during the postservice period of the procedure code overlap with the E/M visit and that the AMA RUC-recommended time refinements were insufficient. As such, we continue to believe that 3 minutes of postservice time accurately reflects the time involved in furnishing the postservice work of this procedure, and that this time is well-aligned with similar services. Therefore, we are finalizing a work RVU of 0.49 for CPT code 68200 with 3 minutes of postservice time, for CY 2014.

(24) Eye and Ocular Adnexa: Conjunctiva (CPT Code 69200)

CPT code 69200 was identified as potentially misvalued under the Harvard-valued utilization over 30,000 screen. On an interim final basis for CY 2013, we assigned a work RVU of 0.77 to CPT code 69200, as well as refining to the AMA RUC-recommended time. In the CY 2013 final rule, we noted that Medicare claims data from 2011 indicated that CPT code 69200 was typically furnished to the beneficiary on the same day as an E/M visit and that some of the activities furnished during the preservice and postservice period of the procedure code overlapped with the E/M visit. To account for this overlap, we removed one-third of the preservice evaluation time from the preservice time package, reducing the preservice evaluation time from 7 minutes to 5 minutes. Additionally, we reduced the AMA RUC-recommended postservice time for this procedure by one-third, from 5 minutes to 3 minutes. After reviewing CPT code 69200 and assessing the overlap in time and work, we agreed with the AMA RUC-recommended work RVU of 0.77 for CY 2013.

Comment: A commenter thanked us for our acceptance of the AMA RUC-recommended work for CPT code 69200.

Response: For CY 2014, we are finalizing the interim final work RVU and time for this code.

(25) Eye and Ocular Adnexa: Conjunctiva (CPT Code 69433)

As detailed in the CY 2013 final rule with comment period, we assigned an interim final work RVU of 1.57 to CPT code 69433; which the AMA RUC had recommended.

Comment: A commenter thanked us for our acceptance of the AMA RUC recommendation.

Response: We are finalizing our interim final work RVU for CY 2014.

(26) Computed Tomographic (CT) Angiography (CPT Code 72191)

As detailed in the CY 2013 final rule with comment period, CPT code 72191 was assigned a CY 2013 interim final work RVU of 1.81, consistent with the AMA RUC recommendation.

As detailed in this final rule with comment period, based upon the AMA RUC recommendations, we are establishing interim final values for codes within the CT angiography family. To allow for contemporaneous public comment on this entire family of codes, we are maintaining the CY 2013 work value for CPT code 72191 as interim final for CY 2014.

(27) Radiologic Guidance: Fluoroscopic Guidance (CPT Codes 77001, 77002 and 77003)

As detailed in the CY 2013 final rule with comment period, CPT codes 77001, 77002 and 77003 were assigned CY 2013 interim final work RVUs of 0.38, 0.54 and 0.60, respectively, based upon AMA RUC recommendations. We received AMA RUC recommendations for work RVUs of 0.38 for CPT code 77001, 0.54 for CPT code 77002 and 0.60 for CPT code 77003.

We agree with the AMA RUC-recommended values but are concerned that the recommended intraservice times for all three codes are generally higher than the procedure codes with which they are typically billed. For example, CPT code 77002 has 15 minutes of intraservice time and CPT code 20610 (Arthrocentesis, aspiration and/or injection; major joint or bursa (eg, shoulder, hip, knee joint, subacromial bursa)) has an intraservice time of only 5 minutes. We are requesting additional public comment and input from the AMA RUC and other stakeholders regarding the appropriate relationship between the intraservice time associated with fluoroscopic guidance and the intraservice time of the procedure codes with which they are typically billed. Therefore, for CY 2014 we are assigning CY 2014 interim final work RVUs of 0.38 to CPT code 77001, 0.54 to CPT code 77002 and 0.60 to CPT code 77003.

(28) Radiology (CPT Codes 75896 and 75898)

CPT code 75896 was identified as potentially misvalued through the codes reported together 75 percent or more screen. As we noted in the CY 2013 final rule with comment period, the AMA RUC intended to survey and review CPT codes 75896 and 75898 for CY 2014 as part of their work on bundling thrombolysis codes. The AMA RUC recommended contractor pricing these two services for CY 2014. However, since we had established a national payment rate for the professional component of these services and only the technical component of the services was contractor priced at that time, we maintained the national price on the professional component and continued contractor pricing for the technical component for these codes on an interim final basis for CY 2013.

We did not receive any comments on these codes nor did we receive any recommendations from the AMA RUC. As we anticipate receiving AMA RUC recommendations for these codes, we are maintaining the current pricing on an interim final basis for CY 2014.

(29) Pathology (CPT Codes 88120, 88121, 88365, 88367, and 88368)

The CPT Editorial Panel created CPT 88120 and 88121 effective for CY 2011. In the CY 2012 PFS final rule with comment period, we assigned interim final work RVUs of 1.20 and 1.00 to CPT codes 88120 and 88121, respectively. We maintained the 2012 work RVUs for 88120 and 88121 as interim final for CY 2013. Additionally, we expressed concern about potential payment disparities between these codes and similar codes, CPT codes 88365, 88367 and 88368, and asked the AMA RUC to review the work and PE for these codes to ensure the appropriate relativity between the two sets of services. Since the AMA RUC is reviewing CPT codes 88365, 88367, and 88368, we are establishing CY 2014 interim final work RVUs of 1.20 for CPT code 88365, 1.30 for CPT code 88367, and 1.40 for CPT code 88368 for CY 2014.

Comment: A commenter stated that it was appropriate to reaffirm the values for 88120 and 88121.

Response: For the reasons stated above, we are assigning CY 2014 interim final work RVUs of 1.20 and 1.00 to CPT codes 88120 and 88121, respectively.

(30) Optical Endomicroscopy (CPT Code 88375)

As detailed in the CY 2013 final rule with comment period, CPT code 88375 was assigned an interim final PFS procedure status of C (Contractors price the code. Contractors establish RVUs and payment amounts for these services.). We received a recommendation from the AMA RUC for a work RVU of 1.08 for CPT code 88375.

CPT code 88375 provides a code for reporting the pathology service when one is required to assist in the procedure. The AMA RUC recommended an intraservice time of 25 minutes and a work RVU of 1.08 for CPT code 88375. Based on our analysis of this recommendation, we believe that the typical optical endomicroscopy case will involve only the endoscopist, and CPT codes 43206 and 43253 are valued to reflect this. Accordingly, we believe a separate payment for CPT code 88375 would result in double payment for a portion of the overall optical endomicroscopy service. Therefore, we are assigning a PFS procedure status of I (Not valid for Medicare purposes. Medicare uses another code for the reporting of and the payment for these services) to CPT code 88375. In the unusual situation that a pathologist is requested to assist an endoscopist in optical endomicroscopy, we would expect the pathologist to report other codes more appropriate to the service (e.g. CPT code 88392 Pathology consultation during surgery).

(31) Psychiatry (CPT Codes 90785, 90791, 90792, 90832, 90833, 90834, 90836, 90837, 90838, 90839, 90840, 90845, 90846, 90847, 90853 and 90863)

For CY 2013, the CPT Editorial Panel restructured the psychiatry/psychotherapy CPT codes allowing for separate reporting of E/M codes, eliminating the site-of-service differential, creating codes for crisis, and creating a series of add-on psychotherapy codes to describe interactive complexity and medication management. The AMA RUC recommended values for all of the codes in this family except CPT codes 90785 (add-on for interactive complexity), 90839 (psychotherapy for crisis, first 60 minutes), 90840 (each additional 30 minutes) and 90863 (pharmacologic management, when performed with psychotherapy) which were the AMA RUC recommended to be contractor priced. In establishing CY 2013 values for the psychitry codes, our general approach was to maintain the CY 2012 values for the services or adopt values that approximated the CY 2012 values after adjusting for differences in code structure between CY 2012 and 2013, for all psychiatry/psychotherapy services on an interim final basis. We noted in the CY 2013 final rule with comment period that we intended to review the values for all the codes in the family once the survey process was complete and we had recommendations for all the codes. This would allow for a comprehensive review of the values for the full code set that would ensure more accurate valuation and proper relativity. The CY 2013 interim values for this family can be found in Table 24.

We have now received AMA RUC recommendations for all of the codes in the family and are establishing CY 2014 interim final work RVUs based on these recommendations. The CY 2014 interim work values displayed in Table 24 correspond with the AMA RUC recommended values, with the exception of CPT code 90863, which has been assigned a PFS procedure status of I (Not valid for Medicare purposes. Medicare uses another code for the reporting of and the payment for these services). These recommendations, which are now complete, have provided us with a comprehensive set of information regarding revisions to the overall relative resource costs for these services. This is consistent with the approach we described in the CY 2013 PFS final rule with comment period (77 FR 69060-69063). Because of the changes for this relativity new code set, we are establishing these values on an interim final basis.

Comment: Several commenters urged CMS to use the AMA RUC-recommended values for CY 2013 and questioned why CMS chose instead to adopt a general approach of maintaining the CY 2012 values for the services. These commenters noted that CMS has previously adopted interim final values for only a portion of new codes in a family, pending subsequent valuation of other codes in the family. Other commenters questioned the logic of maintaining preexisting values for these services since the new set of codes resulted from the identification of these services as potentially misvalued several years ago. Other commenters pointed out that the general approach to valuing the codes resulted in anomalous values. Several other commenters suggested alternative work values for the codes with and without corresponding AMA RUC recommendations.

Response: We appreciate commenters' concerns regarding the appropriate valuation of this family of codes. We also acknowledge that commenters accurately point out that, in some cases, we have previously established new interim values for new codes when related codes have not been simultaneously reviewed. However, as we explained in the CY 2013 final rule with comment period (77 FR 69060), the CY 2013 changes for this family of codes consisted of a new structure that allowed for the separate reporting of E/M codes, the elimination of the site-of-service differential, the establishment of CPT codes for crisis, and the creation of a series of add-on CPT codes to psychotherapy to describe interactive complexity and medication management. We believed that the unusual complexity of these coding changes and the magnitude of their impacts among the affected specialties that furnish these services necessitated a comprehensive review of the potential impact of the changes prior to adopting significant changes in overall value. We also acknowledge that maintaining overall value for services between calendar years with coding changes presents extensive challenges that often result in anomalous values between individual codes. Since we are establishing new interim final work RVUs for the codes in this family for CY 2014 based on the recommendations of the AMA RUC, we believe that commenters' concerns regarding our approach to CY 2013 have been largely been mitigated for CY 2014. We note that the interim final CY 2014 work RVUs for all of these services are open for comment and we will respond to comments regarding these values in the CY 2015 PFS final rule with comment period.

Comment: Several commenters stated that it was difficult for health care professionals that furnish these services to implement use of the new CPT codes for Medicare payment with only a few months' notice given the technology involved in claims systems. Other commenters suggested that CMS should revise CPT code descriptors for codes to conform to Medicare policies.

Response: We appreciate the concern regarding insufficient time to adopt new codes. Although we would prefer for the new, revised and deleted codes to be released in time to appear in PFS proposed rulemaking, the timing of the annual release of the new codes set is completely under the control of the CPT Editorial Panel. We note that CMS does not have the authority to alter CPT code descriptors.

Comment: Several commenters supported CMS's decision to assign CPT code 90863 with a PFS procedure status indicator of I (Not valid for Medicare purposes. Medicare uses another code for the reporting of and the payment for these services) for CY 2013 and encouraged CMS to maintain that status for CY 2014.

Response: We appreciate commenters' support for this assignment. We understand from our past meetings with stakeholders that the ability to prescribe medicine is predicated upon first providing evaluation and management (E/M) services. Although clinical psychologists have been granted prescriptive privileges in Louisiana and New Mexico, we do not believe that they are n authorized under their state scope of practice to furnish the full range of traditional E/M services. As a result, we believe that clinical psychologists continue to be precluded from billing Medicare for pharmacologic management services under CPT code 90863 because pharmacologic management services require some knowledge and ability to furnish E/M services, as some stakeholders have indicated. Even though clinical psychologists in Louisiana and New Mexico have been granted prescriptive privileges, clinical psychologists overall remain unlicensed and unauthorized by their state to furnish E/M services. Accordingly, on an interim final basis for CY 2014, for CPT code 90863, we are maintaining a PFS procedure status indicator of I (Not valid for Medicare purposes. Medicare uses another code for the reporting of and the payment for these services.).

(32) Cardiovascular: Therapeutic Services and Procedures (CPT Codes 92920, 92921, 92924, 92925, 92928, and 92929)

The CPT Editorial Panel created 13 new percutaneous coronary intervention (PCI) CPT codes for CY 2013 (92920, 92921, 92924, 92925, 92928, 92929, 92933, 92934, 92937, 92938, 92941, 92943, and 92944) to replace the 6 existing codes, which resulted in a greater level of granularity.

As detailed in the CY 2013 final rule with comment period, we believed that the CPT-established unbundling of the placement of branch-level stents may encourage increased placement of stents. To eliminate that incentive, on an interim final basis for CY 2013, we rebundled the work associated with the placement of a stent in an arterial branch into the base code for the placement of a stent in an artery. Accordingly, for CY 2013 we bundled each new add-on code into its base code. Specifically, we bundled the work of CPT code 92921 into CPT code 92920, the work of CPT code 92925 into CPT code 92924, the work of CPT code 92929 into CPT code 92928, the work of CPT code 92934 into CPT code 92933, the work of CPT code 92938 into CPT code 92937; and the work of CPT code 92944 into CPT code 92943.

In the CY 2013 final rule with comment period we explained how we established the work RVUs for the new bundled codes. For each code, we used the AMA RUC-recommended utilization crosswalk to determine what percentage of the base code utilization would be billed with the add-on code, and added that percentage of the AMA RUC-recommended work RVU for the add-on code to the AMA RUC-recommended work RVU for the base code. Based on this methodology, we assigned the following CY 2013 interim final work RVUs: 10.10 to CPT code 92920, 11.99 to CPT code 92924, 11.21 to CPT code 92928, 12.54 to CPT code 92933, 11.20 to CPT code 92937, and 12.56 to CPT code 92943.

On an interim final basis for CY 2013, add-on CPT codes 92921, 92925, 92929, 92934, 92938, and 92944 were assigned a PFS procedure status indicator of B (Bundled code. Payments for covered services are always bundled into payment for other services, which are not specified. If RVUs are shown, they are not used for Medicare payment. If these services are covered, payment for them is subsumed by the payment for the services to which they are bundled.) Therefore, these codes were not separately payable.

As detailed in the CY 2013 final rule with comment period, we did not use this methodology to establish a work RVU for CPT code 92941, which did not have a specific corresponding add-on code. After reviewing the service alongside the other services in the family, we believed CPT code 92941 had the same work as CPT code 92943. As we stated above, we assigned a work RVU of 12.56 to CPT code 92943. Therefore, on an interim final basis for CY 2013 we assigned a work RVU of 12.56 to CPT code 92941 with the AMA RUC-recommended intraservice time of 70 minutes.

Comment: Commenters disagreed with our bundling of codes into their respective base codes. Commenters stated that we negated the work of the CPT Editorial Panel, specialty societies, and the AMA RUC by further bundling already bundled codes for PCI services. They indicated that the additional bundling of payment for these codes generated a substantial disconnect between the coding guidelines detailed in the CPT manual and the use of the codes under the Medicare system, causing great uncertainty and confusion. Additionally, commenters stated that the decreases in PCI were of serious concern because it would drive physicians from private practice. Therefore, commenters requested we adopt the CPT Editorial Panel coding construct and the AMA RUC-recommended values for all of the PCI codes. Furthermore, commenters requested that we publish the values for the bundled codes, even though they were not recognized for separate payment by Medicare, so that third-party carriers who depend on the PFS to determine payment rates can develop payment policies that conform to the CPT Editorial Panel's coding decisions.

Response: After re-review, we maintain that our valuation and bundling of codes into their respective base codes is appropriate. We continue to believe that the revised CPT coding structure represents a trend toward creating greater granularity in codes that describe the most intense and difficult work. Specifically for this code family, we continue to believe that making separate Medicare payment for unbundled codes that describe the placement of branch-level stents may encourage increased placement of stents in a fee-for-service system. To eliminate that incentive while maintaining an appropriate reflection of the resources involved in furnishing these services, we continue to believe that rebundling the work associated with the placement of a stent in an arterial branch into the base code for the placement of a stent in an artery is appropriate and consistent with the prior coding structure.

Therefore, we are finalizing work RVU values of 10.10 for CPT code 92920, 11.99 for CPT code 92924 and 11.21 for CPT 92928 and a PFS procedure status indicator of B (Bundled code. Payments for covered services are always bundled into payment for other services, which are not specified. If RVUs are shown, they are not used for Medicare payment. If these services are covered, payment for them is subsumed by the payment for the services to which they are bundled for CPT codes 92921, 92925 and 92929 for CY 2014. We are also finalizing for CY 2014 a work RVU of 12.56 for CPT code 92941, with the AMA RUC-recommended intraservice time of 70 minutes.

(33) Cardiovascular: Intracardiac Electrophysiological Procedures/Studies (CPT Codes 93655 and 93657)

Previously, CPT codes 93651 and 93652 were identified as potentially misvalued through the codes reported together 75 percent or more screen. Upon reviewing these codes, the CPT Editorial Panel deleted CPT codes 93651 and 93652 and and replaced them with new CPT codes 93653 through 93657 effective January 1, 2013.

As detailed in CY 2013 final rule with comment period, we believed these codes had a similar level of intensity to CPT codes 93653, 93654, and 93656, which were all valued at 5.00 RVUs per 1 hour of intraservice time. Therefore, for CY 2013 we assigned a work RVU of 7.50 to CPT codes 93655 and 93657, which have 90 minutes of intraservice time. The AMA RUC recommended a work RVU of 9.00 for CPT code 93655 and a work RVU of 10.00 for CPT code 93657.

Comment: Commenters disagreed with the incremental value methodology for CPT codes 93655 and 93657, stating that our approach did not accurately account for the intensity of these services. They stated that CPT codes 93655 and 93657 are more intense and complex procedures than CPT codes 93653, 93654, and 93656 because patients who require the services have widespread refractory disease, requiring additional technical skill and time. Therefore, commenters requested we use the AMA RUC-recommended work RVUs of 9.0 for CPT code 93655 and 10.0 for CPT code 93657. In addition, one commenter requested that we refer these codes to the refinement panel.

Response: After reviewing the request for refinement, we agreed that CPT codes 93655 and 93657 met the requirements for refinement and referred the codes to the CY 2013 multi-specialty refinement panel for further review. The refinement panel median work RVU for CPT codes 93655 and 93657 are 9.00, and 10.00 respectively. Following the refinement panel meeting, we again reviewed the work involved in this code and continue to believe that the two services involve a very similar level of intensity to CPT codes 93653, 93654, and 93656, which are all valued at 5.00 RVUs per 1 hour of intraservice time. We continue to believe that this is the appropriate value for CPT codes 93655 and 93657 because we believe these services contain the same amount of work as the base codes, CPT codes 93653, 93654, and 93656. Therefore, we are finalizing a work RVU of 7.50 for CPT codes 93655 and 93657 for CY 2014.

(34) Noninvasive Vascular Diagnostic Studies: Extremity Arterial Studies (Including Digits) (CPT Codes 93925 and 93926)

Previously, CPT codes 93925 and 93926 were identified by the AMA RUC as potentially misvalued and we received AMA RUC recommendations for CY 2013.

After reviewing CPT codes 93925 and 93926, we believed that the survey's 25th percentile work RVUs of 0.80 for CPT code 93925 and 0.50 for CPT code 93926 accurately accounted for the work involved in furnishing the services and appropriately captured the increase in work since the services were last valued and assigned these as interim final work RVUs for CY 2013. As we noted in the CY 2013 final rule with comment period, we believed that the AMA RUC-recommended survey median work RVUs of 0.90 for CPT code 93925 and 0.70 for CPT code 93926 overstated the increase in work for the services and that the RVUs were too high relative to similar services. Regarding physician time, we refined the AMA RUC- recommended preservice and postservice times from 5 minutes to 3 minutes to align with similar services, specifically CPT codes 93922 and 93923.

Comment: All commenters disagreed with our work valuation and some commenters also disagreed with our time refinements for CPT codes 93925 and 93926. One commenter stated that the work RVUs for CPT codes 93925 and 93926 should be increased because the work associated with the services has changed and also argued that our valuations were arbitrary in nature and unsupported. Two commenters noted that the AMA RUC-recommended work RVUs of 0.90 for CPT code 93925 and 0.70 for CPT code 93926 were supported by relativity comparisons to CPT codes 93306, 73700, 76776 and 76817 and according the CY 2013 interim final work RVU values were too low. Additionally, two commenters disagreed with our time refinements for CPT codes 93925 and 93926 from the survey's median to the survey's 25th percentile values. One commenter specifically disagreed with our use of CPT codes 93922 and 93923 as reference codes for time refinements because they stated “physiologic studies do not require artery-by-artery inch-by-inch assessment of femoral and tibial arteries, as do the duplex exams” and as such, are not appropriate codes for comparison. They added that CPT codes 93925 and 93926 require more time for proper performance of the exam and interpretation of results. All commenters suggested acceptance of the AMA RUC recommendations. One commenter also requested refinement panel review of the codes.

Response: After evaluation of the request for refinement, we determined that the criteria for the request for refinement were not met and, as a result, we did not refer CPT codes 93925 and 93926 to the CY 2013 multi-specialty refinement panel for further review.

After reviewing the comments, we maintain that our valuation is appropriate. We continue to believe that that the survey's 25th percentile work RVUs of 0.80 for CPT code 93925, and 0.50 for CPT code 93926 accurately account for the work involved in furnishing these services and appropriately captures the increase in work since these services were last valued. Additionally, we continue to believe that a refinement to the AMA RUC-recommended time is appropriate to align the times with those associated with CPT codes 93922 and 93923 that describe similar services. Therefore, we are finalizing a work RVU of 0.80 to CPT code 93925 and a work RVU of 0.50 to CPT code 93926, with 3 minutes of preservice and postservice time for CY 2014.

(35) Neurology and Neuromuscular Procedures: Sleep Medicine Testing (CPT Codes 95782 and 95783)

The CPT Editorial Panel created new CPT codes 95782 and 95783, effective January 1, 2013, to describe the work involved in pediatric polysomnography for children 5 years of age or younger. For CY 2013, we assigned an interim final work RVU of 2.60 to CPT code 95782 and a work RVU of 2.83 to CPT code 95783. As we noted in the CY 2013 final rule with comment period, we assigned these values after we reviewed CPT codes 95782 and 95783 and determined that the survey's 25th percentile work RVUs of 2.60 for CPT code 95782 and 2.83 for CPT code 95783 appropriately reflected the work involved in furnishing the services. The AMA RUC recommended the survey's median work RVUs of 3.00 for CPT code 95782 and 3.20 for CPT code 95783.

Comment: Commenters disagreed with our valuation of CPT codes 95782 and 95783, stating that the services should have received a greater valuation explaining that it is more difficult to perform sleep studies on children than adults, and more work is required to obtain an accurate polysomnogram due to children's greater need for attention and, in some cases, even mild sedation. Additionally, commenters noted that the work involved in the interpretation of data supported a higher work RVU. Therefore, commenters requested that we use the AMA RUC-recommended work RVU of 3.00 for CPT code 95782 and 3.20 for CPT code 95783.

Response: After consideration of comments and re-reviewing of CPT codes 95782 and 95783, we maintain that our valuation is appropriate. We continue to believe that that the survey's 25th percentile work RVUs of 2.60 for CPT code 95782 and 2.83 for CPT code 95783 accurately accounts for the work involved in furnishing these services. Therefore, we are finalizing a work RVU of 2.60 for CPT code 95782 and 2.83 for CPT code 95783, for CY 2014.

(36) Neurology and Neuromuscular Procedures: Electromyography and Nerve Conduction Tests (CPT Codes 95885, 95886, and 95887)

CPT codes 95860, 95861, 95863, and 95864 were previously identified as potentially misvalued through the codes reported together 75 percent or more screen. The relevant specialty societies submitted a code change proposal to the CPT Editorial Panel to bundle the services commonly reported together. In response, the CPT created three add-on codes (CPT codes 95885, 95886, and 95887) and seven new codes (CPT codes 95907 through 95913) that bundled the work of multiple nerve conduction studies into each individual code.

We agreed with the AMA RUC recommendation for CPT code 95885 and assigned a CY 2013 interim final work RVU of 0.35. After review, we determined that CPT codes 95886 and 95887 involved the same level of work intensity as CPT code 95885. To determine the appropriate RVU for CPT codes 95886 and 95887, we increased the work RVUs of CPT codes 95886 and 95887 proportionate to the differences in times from CPT code 95885. Therefore, we assigned an interim final work RVU of 0.70 to CPT code 95886 and of 0.47 to CPT code 95887 for CY 2013 as compared to the AMA RUC-recommended 0.92 and 0.73, respectively.

Comment: Commenters indicated that we utilized a flawed building block approach in valuing CPT codes 95886 and 95887 because the methodology did not take into account precise distinctions within each service and inaccurately assumed that the codes had identical intensity and complexity. Commenters supported the AMA RUC-recommended values developed using magnitude estimation saying that the methodology was more precise due to its use of data derived from multiple factors like physician time, intensity and work value estimates. Additionally, commenters noted that we failed to distinguish the increasing intensity and complexity involved as additional nerve conductions were performed. Therefore, commenters requested our use of the AMA RUC-recommended work RVU of 0.92 for CPT code 95886 and 0.73 for CPT code 95887 and refinement panel review of the codes.

Response: After reviewing the request for refinement, we agreed that CPT codes 95886 and 95887 met the requirements for refinement and referred the codes to the CY 2013 multi-specialty refinement panel for further review. The refinement panel median work RVUs for CPT codes 95886 and 95887 were respectively, 0.92 and 0.73. Following the refinement panel meeting, we again reviewed the work involved in these codes and agreed with the panel that these codes were more intense and complex than reflected in the CY 2013 interim final values and, as such, warranted a higher work RVU. While we agree that work RVUs for CPT codes 95886 and 95887 should be increased, based on our clinical review, we conclude that the refinement panel's suggested values overstate the work involved in these procedures.

We believe that the work for CPT code 95886 is similar to the work performed when five or more muscles are examined in one extremity, as described by CPT code 95860, which has a work RVU of 0.96. However, CPT code 95886 is an add-on code to nerve conduction studies. Therefore, as we have previously valued services that overlap with another CPT code, we applied a 10% reduction to the work RVU of CPT code 95860 to determine a work RVU of 0.86 for CPT code 95886. Similarly, in our valuation of CPT code 95887, we believe that the work for the code is similar to the work performed when cranial nerve supplied muscles are examined, as described by CPT code 95867, which has a work RVU of 0.79. However, CPT code 95887 is an add-on code to nerve conduction studies. Therefore, as we have previously valued services that overlap with another code, we applied a 10 percent reduction to the work RVU of CPT code 95867 to determine a work RVU of 0.79 for CPT code 95887. For CY 2014, we are finalizing a work RVU of 0.86 for CPT code 95886 and 0.71 for CPT code 95887.

(37) Neurology and Neuromuscular Procedures: Electromyography and Nerve Conduction Tests (CPT Codes 95908, 95909, 95910, 95911, 95912, and 95913)

In our CY 2013 review, we did not accept the AMA RUC-recommended values for CPT codes 95908, 95909, 95910, 95911, 95912, and 95913. For those codes, we found that the progression of the survey's 25th percentile work RVUs and survey's median times appropriately reflected the relativity of the services and valued the codes accordingly. CPT code 95908 was an exception to this, as we believed the survey's 25th percentile work RVU was too low relative to other fee schedule services. Therefore, we assigned the following work RVUs for CY 2013: 1.00 to CPT code 95907, 1.25 to CPT code 95908, 1.50 to CPT code 95909, 2.00 to CPT code 95910, 2.50 to CPT code 95911, 3.00 to CPT code 95912, and 3.56 to CPT code 95913.

Additionally, we refined the AMA RUC-recommended intraservice time for CPT code 95908 from 25 minutes to the survey's median time of 22 minutes and for CPT code 95909 from 35 minutes to the survey's median time of 30 minutes, so that all the CPT codes in the series were valued using the survey's median intraservice time.

Comment: Commenters disagreed with our valuation of CPT codes 95908, 95909, 95910, 95911, 95912, and 95913. Commenters opposed the interim final values for the codes because they believed the intensity and complexity of the procedures increased as more nerve conductions were performed and as a result, believed that the valuations should be higher. Additionally, commenters believe that because no significant changes in the efficiencies of the test had occurred, in terms of time and cost related to performance, that our changes in the valuations were unjustified. Therefore, commenters requested that we accept the AMA RUC-recommended work RVUs for all of these codes and requested refinement panel review. Lastly, commenters also suggested that if the interim final values were to be finalized, that their implementation be staggered to limit the adverse impacts that the values would have on health care access.

Response: After reviewing the request for refinement, we agreed that CPT codes 95908, 95909, 95910, 95911, 95912, and 95913 met the requirements for refinement and referred the codes to the CY 2013 multi-specialty refinement panel for further review. The refinement panel median work RVUs were: 1.37 for CPT code 95908, 1.77 for CPT code 95909, 2.80 for CPT code 95910, 3.34 for CPT code 95911, 4.00 for CPT code 95912, and 4.20 for CPT code 95913. Following the refinement panel meeting, we again reviewed the work involved in these codes and continue to believe that the progression of the survey's 25th percentile work RVUs and survey median times for these codes appropriately reflect the relativity of these codes. CPT code 95908 was an exception to this approach because we believe that the survey's 25th percentile work RVU is too low relative to other fee schedule services. We also note that we do not believe that the results of the survey support the notion that the intensity and complexity of the procedures increases as more nerve conductions are performed. Instead, we believe that the incremental differences reflected in the survey correspond with the incremental differences in our CY 2013 interim final values. Therefore, we are finalizing the CY 2013 interim final work RVUs and time refinements for CPT codes 95908, 95909, 95910, 95911, 95912, and 95913 for CY 2014. With regard to the comment that our rates would impede access to these critical services, we are unaware of data that shows that access has declined.

(38) Evoked Potentials (CPT Codes 95928 and 95929)

As detailed in the CY 2013 final rule with comment period, CPT codes 95928 and 95929 were each assigned a CY 2013 interim final work RVU of 1.50. Subsequently, the AMA RUC recommended intraservice time for these codes based on only 19 of the 28 survey responses. As a result, the AMA RUC recommendations included an intraservice time of 40 minutes with which we do not agree. When based on all 28 survey responses, the intraservice time is 33 minutes. We agree with the AMA RUC recommended preservice and postservice times because they are consistent across all 28 survey responses. Therefore, for CY 2014, we are refining the preservice time, intraservice and postservice times for CPT codes 95928 and 95929 to 15 minutes, 33 minutes and 10 minutes, respectively. We are assigning CY 2014 interim final work RVUs of 1.50 to CPT codes 95928 and 95929, based upon the AMA RUC recommendations, and are seeking public input on the time of the codes.

(39) Neurology and Neuromuscular Procedures: Intraoperative Neurophysiology (CPT Codes 95940 and 95941 and HCPCS Code G0453)

Effective January 1, 2013, the CPT Editorial Panel deleted CPT code 95920 and replaced it with CPT codes 95940 for continuous intraoperative neurophysiology monitoring in the operating room requiring personal attendance and 95941 for continuous intraoperative neurophysiology monitoring from outside the operating room (remote or nearby). Prior to CY 2013, the Medicare PFS paid for remote monitoring billed under CPT code 95920, which was used for both in-person and remote monitoring. For CY 2013, we created HCPCS code G0453 to be used for Medicare purposes instead of CPT code 95941. Unlike CPT code 95941, HCPCS code G0453 can be billed only for undivided attention by the monitoring physician to a single beneficiary, not for the monitoring of multiple beneficiaries simultaneously. Since G0453 was used for remote monitoring of Medicare beneficiaries, CPT code 95941 was assigned a PFS procedure status indicator of I (Not valid for Medicare purposes. Medicare uses another code for the reporting of and the payment for these services.

As detailed in the CY 2013 final rule with comment period, after reviewing CPT code 95940, we agreed with the AMA RUC that a work RVU of 0.60 accurately accounted for the work involved in furnishing the procedure. Also, we agreed with the AMA RUC that a work RVU of 2.00 accurately accounted for the work involved in furnishing 60 minutes of continuous intraoperative neurophysiology monitoring from outside the operating room. Accordingly, we assigned a work RVU of 0.50 to HCPCS code G0453, which described 15 minutes of monitoring from outside the operating room, on an interim final basis for CY 2013.

Comment: Commenters disagreed with our valuation of CPT codes 95940, 95941 and G0453. Commenters opposed the one-on-one patient to physician model that our recommendations proposed. Commenters stated the following: G0453 was contradictory to current provider models; the accessibility of IONM services would be lowered; surgeons would be deprived of advantageous services; qualified level of professional supervision would be reduced; hospitals would suffer increased overheard costs; and GO453 inappropriately assessed the services. Therefore, commenters requested we withdraw HCPCS code G0453 and validate CPT codes 95940 and 95941 together, through acceptance of the AMA RUC-recommended work RVUs of 0.60 for CPT code 95940 and 2.00 for CPT code 95941.

Another commenter suggested we value CPT code 95941 at 0.5 of CPT 95940 although a rationale for that valuation was not provided. Several other commenters requested we increase the work value of G0453 so that it was equal to the work RVU assigned to CPT code 95940 because they believed the physician time and effort for both services was the same. The majority of commenters suggested we value the concurrent monitoring of up to 4 patients by a neurologist with the creation of additional G codes for the remote monitoring of 2, 3 or 4 patients.

Response: Based on comments received, we re-reviewed CPT codes 95940, 95941 and HCPCS code G0453 and agree that based on the comparable nature of the work between CPT code 95940 and HCPCS code G0453, that G0453 should be valued equally to CPT code 95940.

Therefore, we are finalizing a work RVU of 0.60 to CPT code 95940 and 0.60 to HCPCS code G0453 for CY 2014. We are also finalizing a PFS procedure status indicator of I (Not valid for Medicare purposes. Medicare uses another code for the reporting of and the payment for these services) to CPT code 95941 for CY 2014, because for Medicare purposes, HCPCS code G0453 will continue to be used instead of CPT code 95941. Although we considered commenters' suggestions to value concurrent monitoring of up to 3 or 4 patients by a neurologist with the creation of additional G-codes for the remote monitoring of 2, 3 or 4 patients, creation of these G codes would allow billing for more than 60 minutes of work during a 60 minute time period. We continue to believe that HCPCS code G0453 adequately accounts for the relative resources involved when the physician monitors a Medicare beneficiary, while it precludes inaccurate payment in cases where multiple patients are being monitored simultaneously. Therefore, we will maintain the current code descriptor for HCPCS code G0453.

Comment: Some commenters suggested we create mechanisms for practitioners to report the professional and technical components separately for CPT codes 95940 and HCPCS code G0453. One of these commenters suggested that creating separate technical component payment for the PFS would allow hospitals to approximate the relative resource costs associated with the technical component of the service.

Response: It is our understanding that these services are nearly always furnished to beneficiaries in facility settings. Therefore, Medicare would not make payments through the PFS that account for the clinical labor, disposable supplies, or medical equipment involved in furnishing the service. Instead, these resource costs would be included in the payment Medicare makes to the facility through other payment mechanisms. Therefore, we do not believe it would be appropriate to create separate payment rates for the professional and technical component of these services.

(40) Neurology System: Autonomic Function Tests (CPT Code 95943)

As detailed in the CY 2013 final rule with comment period, we assigned a PFS procedure status of C to CPT code 95943, pursuant to the AMA RUC recommendation. (Contractors price the code. Contractors establish RVUs and payment amounts for these services.) The AMA RUC believes that a PFS procedure status of “C” was appropriate because they did not have sufficient information for making a specific work RVU recommendation.

Comment: Commenters opposed contractor pricing of CPT code 95943 because the other autonomic nervous system testing codes have national work RVUs and payment rates. Commenters suggested we crosswalk CPT code 95943 to CPT code 95924 due to the procedures' similarity in total work.

Response: We continue to believe that a PFS procedure status of C (Contractors price the code. Contractors establish RVUs and payment amounts for these services.) is appropriate for CPT code 95943. We do not believe that the commenters provided sufficient data to value the service. Therefore, we are finalizing a Contractor Pricing procedure status to CPT code 95943 for CY 2014.

(41) Inpatient Neonatal Intensive Care Services and Pediatric and Neonatal Critical Care Services: Pediatric Critical Care Patient Transport (CPT Codes 99485 and 99486)

For CY 2013, he CPT editorial panel created CPT codes 99485 and 99486, to describe the non-face-to-face services provided by physician to supervise interfacility care of critically ill or critically injured pediatric patients.

As detailed in the CY 2013 final rule with comment period, we reviewed CPT codes 99485 and 99486 and believed the services should be bundled into other services and not be separately payable. We believed the services were similar to CPT code 99288, which is also bundled on the PFS. The AMA RUC recommended a work RVU of 1.50 for CPT code 99485 and a work RVU of 1.30 for CPT code 99486. On an interim final basis for CY 2013, we assigned CPT codes 99485 and 99486 a PFS procedure status indicator of B (Payments for covered services are always bundled into payment for other services, which are not specified. If RVUs are shown, they are not used for Medicare payment. If these services are covered, payment for them is subsumed by the payment for the services to which they are bundled).

Comment: Commenters disagreed with our assignment of CPT codes 99485 and 99486 as bundled codes. They stated that that classification puts pediatric physicians at a disadvantage since the majority of non-Medicare payers will commonly bundle the codes as well. Commenters strongly recommended that we adopt status indicator A (Active) or, at the very least, status indicator N (Noncovered Service) for CPT codes 99485 and 99486.

Response: We continue to believe that CPT codes 99485 and 99486 are similar to CPT code 99288 and, like CPT code 99288, involve work that is already considered in the valuation of other services. Therefore, we do not believe that these services should be separately payable. Therefore, we are finalizing a PFS procedure status of B (Payments for covered services are always bundled into payment for other services, which are not specified. If RVUs are shown, they are not used for Medicare payment. If these services are covered, payment for them is subsumed by the payment for the services to which they are bundled) to CPT codes 99485 and 99486 for CY 2014.

(42) Molecular Pathology (HCPCS Code G0452)

As detailed in the CY 2013 final rule with comment period, one of the molecular pathology CPT codes that was deleted by CPT for CY 2012 was payable on the PFS: CPT code 83912-26. To replace this CPT code, we created HCPCS code G0452 to describe medically necessary interpretation and written report of a molecular pathology test, above and beyond the report of laboratory results. We reviewed the work associated with this procedure and we believed it was appropriate to directly crosswalk the work RVUs and times of CPT code 83912-26 to HCPCS code G0452, because we did not believe the coding change reflected a change in the service or in the resources involved in furnishing the service. Accordingly, we assigned a work RVU of 0.37, with 5 minutes of preservice time, 10 minutes of intraservice time, and 5 minutes of postservice time to HCPCS code G0452 on an interim final basis for CY 2013.

Comment: Commenters disagreed with our valuation of HCPCS code G0452. Commenters expressed concern about the creation of a single HCPCS G-code to distinguish work related to a considerable number of procedures with changing relative values recommended by the AMA RUC.

Response: The decision to pay for molecular pathology codes under the CLFS required the creation of a new code for the interpretation and reporting services by pathologists on the PFS. We continue to believe that the creation of HCPCS code G0452 was appropriate to describe medically necessary interpretation and written report of a molecular pathology test, above and beyond the report of laboratory results. We also believe that this single HCPCS code is sufficient to capture the work involved in any of the numerous molecular pathology codes. Additionally, the professional component-only HCPCS G-code is a “clinical laboratory interpretation service,” which is one of the current categories of PFS pathology services under the definition of physician pathology services at § 415.130(b)(4). Therefore, we are finalizing a work RVU of 0.37 to HCPCS code G0452.

(43) Digestive System: Intestines (Except Rectum) (CPT Code G0455)

For CY 2013, we created HCPCS code G0455 to be used for Medicare purposes instead of CPT code 44705. HCPCS code G0455 will be used to bundle the preparation and instillation of microbiota. CPT code 44705 was assigned a PFS procedure status indicator of I (Not valid for Medicare purposes).

After reviewing the preparation and instillation work associated with this procedure, we believed that CPT code 99213 was an appropriate crosswalk for the work and time of HCPCS code G0455. Therefore, on an interim final basis for CY 2013, we assigned a work RVU of 0.97 to HCPCS code G0455.

Comment: Commenters disagreed with our valuation of HCPCS code G0455. Commenters opposed the interim final work RVU because they believed extensive work was required for the preparation of the microbiota, to determine if a patient was an appropriate candidate for fecal donation. Commenters believed that our work RVU valuation failed to distinguish between varying clinical circumstances for the use of this code. Commenters also suggested that we should consider coverage of more than one donor specimen screening when clinically suitable.

Response: After review, we agree with the commenters that the interim final work RVU of 0.97 undervalues this service. We believe that bundling the work RVU and physician time of CPT code 80500, a lab pathology consultation, with CPT code 99213 more appropriately values this work. Therefore, we are finalizing a work RVU of 1.34 and an intraservice time of 28 minutes for HCPCS code G0455.

b. Finalizing CY 2013 Interim Direct PE Inputs

(i) Background and Methodology

On an annual basis, the AMA RUC provides CMS with recommendations regarding direct PE inputs, including clinical labor, disposable supplies, and medical equipment, for new, revised, and potentially misvalued codes. We review the AMA RUC-recommended direct PE inputs on a code-by-code basis. When we determine that the AMA RUC recommendations appropriately estimate the direct PE inputs required for the typical service and reflect our payment policies, we use those direct PE inputs to value a service. If not, we refine the PE inputs to better reflect our estimate of the PE resources required for the service. We also confirm whether CPT codes should have facility and/or nonfacility direct PE inputs and refine the inputs accordingly.

In the CY 2013 PFS final rule with comment period (77 FR 69072), we addressed the general nature of some of our common refinements to the AMA RUC-recommended direct PE inputs as well as the reasons for refinements to particular inputs. In the following subsections, we respond to the comments we received regarding common refinements we made based on established principles or policies. Following those discussions, we summarize and respond to comments received regarding other refinements to particular codes.

We note that the interim final direct PE inputs for CY 2013 that are being finalized for CY 2014 are displayed in the final CY 2014 direct PE input database, available on the CMS Web site under the downloads for the CY 2014 PFS final rule at http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PhysicianFeeSched/PFS-Federal-Regulation-Notices.html. The inputs displayed there have also been used in developing the CY 2014 PE RVUs as displayed in Addendum B of this final rule with comment period.

(ii) Common Refinements

(1) Equipment Time

Prior to CY 2010, the AMA RUC did not generally provide CMS with recommendations regarding equipment time inputs. In CY 2010, in the interest of ensuring the greatest possible degree of accuracy in allocating equipment minutes, we requested that the AMA RUC provide equipment times along with the other direct PE recommendations, and we provided the AMA RUC with general guidelines regarding appropriate equipment time inputs. We continue to appreciate the AMA RUC's willingness to provide us with these additional inputs as part of its direct PE recommendations.

In general, the equipment time inputs correspond to the service period portion of the clinical labor times. We have clarified this principle, indicating that we consider equipment time as the times within the intraservice period when a clinician is using the piece of equipment plus any additional time that the piece of equipment is not available for use for another patient due to its use during the designated procedure. For services in which we allocate cleaning time to portable equipment items, we do not include that time for the remaining equipment items as they are available for use for other patients during that time. In addition, when a piece of equipment is typically used during any additional visits included in a service's global period, the equipment time would also reflect that use.

We believe that certain highly technical pieces of equipment and equipment rooms are less likely to be used during all of the preservice or postservice tasks performed by clinical labor staff on the day of the procedure (the clinical labor service period) and are typically available for other patients even when one member of clinical staff may be occupied with a preservice or postservice task related to the procedure.

Some commenters have repeatedly objected to our rationale for refinement of equipment minutes on this basis. We acknowledge the comments we received that reiterate those objections to this rationale and refer readers to our extensive discussion regarding those objections in the CY 2012 PFS final rule with comment period (76 FR 73182). In the following paragraphs we address new comments on this policy.

Comment: Several commenters pointed out that technician time is independent of physician time for some procedures so that equipment time should not be altered based on changes in physician intraservice time.

Response: The estimated time it takes for a practitioner or clinical staff to furnish a procedure is an important factor used in determining the appropriate direct PE input values used in developing nonfacility PE RVUs. For many services, the physician intraservice time serves as the basis for allocating the appropriate number of minutes within the service period to account for the time used in furnishing the service to the patient. In the case of many services, the number of physician intraservice minutes, or occasionally a particular proportion thereof, is allocated to both the clinical staff that assist the practitioner in furnishing the service and to the equipment used by either the practitioner or the staff in furnishing the service. This allocation reflects only the time the beneficiary receives treatment and does not include resources used immediately prior to or following the service. Additional minutes are often allocated to both clinical labor and equipment resources to account for the time used for necessary preparatory tasks immediately preceding the procedure or tasks typically performed immediately following it. For these services, we routinely adjust the minutes assigned to the direct PE inputs so that they correspond with the procedure time assumptions displayed in the physician time file that are used in determining work RVUs and allocating indirect PE values.

The commenters accurately point out that for a significant number of services, especially diagnostic tests, the procedure time assumptions used in determining direct PE inputs are distinct from, and therefore not dependent on, physician intraservice time assumptions. For these services, we do not make refinements to the direct PE inputs based on changes to estimated physician intraservice times.

Comment: Several commenters asked that CMS identify what constitutes a highly technical piece of equipment.

Response: During our review of all recommended direct PE inputs, we consider whether or not particular equipment items would typically be used in the most efficient manner possible. In making this determination, we consider such items as the degree of specificity of a piece of equipment, which may influence whether the equipment item is likely to be stored in the same room in which the clinical staff greets and gowns, obtains vitals, or provides education to a patient prior to the procedure itself. We also consider the level of portability (including the level of difficulty involved in cleaning the equipment item) to determine whether an item could be easily transferred between rooms before or after a given procedure. We also examine the prices for the particular equipment items to determine whether the equipment is likely to be located in the same room used for all the tasks undertaken by clinical staff prior to and following the procedure. For each service, on a case-by-case basis, we look at the description provided in the AMA RUC recommendation and consider the overlap of the equipment item's level of specificity, portability, and cost; and, consistent with the review of other recommended direct PE inputs, make the determination of whether the recommended equipment items are highly technical.

(2) Standard Tasks and Minutes for Clinical Labor Tasks

In general, the preservice, service period, and postservice clinical labor minutes associated with clinical labor inputs in the direct PE input database reflect the sum of particular tasks described in the information that accompanies the recommended direct PE inputs, “PE worksheets.” For most of these described tasks, there are a standardized number of minutes, depending on the type of procedure, its typical setting, its global period, and the other procedures with which it is typically reported. At times, the AMA RUC recommends a number of minutes either greater than or less than the time typically allotted for certain tasks. In those cases, CMS clinical staff reviews the deviations from the standards to determine their clinical appropriateness. Where the AMA RUC-recommended exceptions are not accepted, we refine the interim final direct PE inputs to match the standard times for those tasks. In addition, in cases when a service is typically billed with an E/M, we remove the preservice clinical labor tasks so that the inputs are not duplicative and reflect the resource costs of furnishing the typical service.

In general, clinical labor tasks fall into one of the categories on the PE worksheets. In cases where tasks cannot be attributed to an existing category, the tasks are labeled “other clinical activity.” In these instances, CMS clinical staff reviews these tasks to determine whether they are similar to tasks delineated for other services under the PFS. For those tasks that do not meet this criterion, we do not accept those clinical labor tasks as direct inputs.

Comment: Several commenters objected to CMS's refinement to recommended clinical labor minutes to meet these standards in cases where the recommendation included information suggesting that the service requires specialized clinical labor tasks, especially relating to quality assurance documentation, that are not typically included on the PE worksheets.

Response: Although we appreciate the importance of quality assurance and other tasks, we note that the nonfacility direct PE inputs include an estimated number of clinical labor minutes for most codes developed based on an extensive, standard list of clinical labor tasks such as “prepare equipment,” and “prepare and position patient.” We believe that quality assurance documentation tasks for services across the PFS are already accounted for in the overall estimate of clinical labor time. We do not believe that it would serve the relativity of the direct PE input database were additional minutes added for each clinical task that could be discretely described for every code and thus are not making any changes based upon this comment.

(3) Equipment Minutes for Film Equipment Inputs

In general, the equipment time allocated to film equipment, such as “film processor, dry, laser” (ED024), “film processor, wet” (ED025), and “film alternator (motorized film viewbox)” (ER029), corresponds to the clinical labor task “hang and process film.”

Comment: Several commenters argued that the film equipment should be allocated for the entire service period.

Response: We believe that the film equipment, when used, is typically only used during the time associated with certain clinical labor tasks, and is otherwise generally available for use in furnishing services to other patients. In reviewing these equipment inputs in the direct PE input database, we note that this equipment is generally not allocated for the full number of minutes of the clinical labor service period. Because we do not believe that this equipment would be in use during periods other than during particular clinical labor tasks, and to maintain relativity, we are finalizing the CY 2013 direct PE inputs based on this general principle.

(4) Film Inputs as a Proxy for Digital Imaging Inputs

Comment: A few commenters objected to our refinement of certain film inputs including eliminating VHS video system and tapes, and reducing the number of films for several procedures. Commenters also stated that the film processor was a necessary input for several procedures from which it was removed.

Response: As stated in the CY 2013 PFS final rule with comment period (77 FR 69029), a variety of imaging services across the PFS include direct PE inputs that reflect film-based technology instead of digital technology. We believe that for imaging services, digital technology is more typical than film technology. However, stakeholders, including the AMA RUC, have recommended that we continue to use film technology inputs as a proxy for digital until digital inputs for all imaging services can be considered. In response to these recommendations, we have maintained inputs for film-based technology as proxy inputs while this review occurs. In the case of new, revised, and potentially misvalued codes, we have accepted the recommended proxy inputs to the extent that the recommended proxy inputs are those that are usually associated with imaging codes. However, we have not accepted recommended inputs that are not usually included in other imaging services. We have reviewed the recommended inclusion of the film processor and, upon additional review, noted that the item is routinely included in other imaging codes. Therefore, we are including that item in the direct PE input database. We anticipate updating all of the associated inputs in future rulemaking. After consideration of comments received, we are finalizing the direct PE inputs in accordance with this general principle with the additional refinement of inserting the film processor for relevant codes.

(iii) Code-Specific Direct PE Inputs

We note that we received many comments objecting to refinements made based on CMS clinical review (including our determination that certain recommended items were duplicative of others already included with the service), statutory requirements, or established principles and policies under the PFS. We note that for many of our refinements, the medical specialty societies that represent the practitioners who furnish the service objected to most of these refinements for the general reasons described above or for the reasons we respond to in the “background and methodology” portion of this section. Below, we respond to comments in which commenters address specific CPT/HCPCS codes and provide rationale for their objections to our refinements in the form of new information supporting the inclusion of the items and/or times requested. When discussing these refinements, rather than listing all refinements made for each service, we discuss only the specific refinements that meet these criteria. We indicate the presence of other refinements by noting “among other refinements” after delineating the specific refinements for a particular service or group of services. For those comments that stated that an item was “necessary for the service” and no additional rationale or evidence was provided, we conducted further review to determine whether the inputs as refined were appropriate and concluded that the inputs as refined were indeed appropriate.

Further, in the CY 2013 PFS correction notice (78 FR 48996), we addressed several technical and typographical errors that respond to comments received. We do not repeat those comments nor provide our responses for those items here.

(1) Cross-Family Comments

Comment: We received comments regarding refinements to equipment times for many procedures, in which commenters indicated that the equipment time for the procedure should include the time that the equipment is unavailable for other patients, including while preparing equipment, positioning the patient, assisting the physician, and cleaning the room.

Response: As stated above, we agree with commenters that the equipment time should include the times within the intraservice period when a clinician is using the piece of equipment plus any additional time the piece of equipment is not available for use for another patient due to its use during the designated procedure. We believe that some of these commenters are suggesting that we should allocate the full number of clinical labor minutes included in the service period to the equipment items. However, as we have explained, the clinical labor service period includes minutes based on some clinical labor tasks associated with preservice and postservice activities that we do not believe typically preclude equipment items from being used in furnishing services to other patients because these activities typically occur in other rooms.

The equipment times allocated to the CPT codes in Table 25 already include the full intraservice time the equipment is typically used in furnishing the service, plus additional minutes to reflect time that the equipment is unavailable for use in furnishing services to other patients.

Table 25—Equipment Inputs That Include Appropriate Clinical Labor Tasks About Which Comments Were Received Back to Top
CPT code Equipment items
50590 EQ175.
52214 all items.
52224 all items.
72040 EL012.
72050 EL012.
72052 EL012.
72192 EL007.
72193 EL007.
72194 EL007.
73221 EL008.
73721 EL008.
74150 EL007.
74160 EL007.
74170 EL007.
74175 EL007.
74177 EL007.
74178 EL007.
77301 ER005.
78012 ER063.
78013 ER032.
78014 EF010, ER063.
78070 ER032.
78071 ER032.
93925 EL016.
93926 EL016.
93970 EL016.

Comment: Some commenters stated that selected items added to various CPT codes during clinical review by CMS were not typical. In Table 26, we list those services and items identified by commenters as atypical for the service. For each of these items, we note whether we maintained our refinement or removed the input based on commenter recommendation. In general, we have accepted the comments to remove the items, except when we believed that doing so would deviate from our standard policies. Specifically, as we discuss above, we are maintaining standard times for clinical labor tasks; these include 10 minutes for “clean surgical instrument package” for CPT codes 11301-11313, the time for “Assist physician in performing procedure” to conform to physician time for CPT code 13150, and the equipment minutes used exclusively for the patient for “lane, screening (oph)” (EL006) for CPT codes 92081, 92082, and 92083.

Table 26—Items Identified as Not Typical by Commenters Back to Top
CPT code/code range CMS code CMS code description Labor activity (if applicable) AMA RUC recommendation CMS refinement Commenter recommendation CMS decision/rationale
11301-11313 L037D RN/LPN/MTA Clean Surgical Instrument Package 1 10 1 Maintain refinement/Standard Time.
13150 L037D RN/LPN/MTA Assist physician in performing procedure 20 26 20 Maintain refinement/Standard Time.
32554 SA067 tray, shave prep 0 1 0 Removed.
SB001 cap, surgical 0 2 0 Removed.
SB039 shoe covers, surgical 0 2 0 Removed.
32556 SA044 pack, moderate sedation 0 1 0 Removed.
SA067 tray, shave prep 0 1 0 Removed.
SB001 cap, surgical 0 2 0 Removed.
SB039 shoe covers, surgical 0 2 0 Removed.
SC010 closed flush system, angiography 0 1 0 Removed.
SH065 sodium chloride 0.9% flush syringe 0 1 0 Removed.
SH069 sodium chloride 0.9% irrigation (500-1000 ml uou) 0 1 0 Removed.
32557 SB027 gown, staff, impervious 0 1 0 Removed.
SG078 tape, surgical occlusive 1 in (Blenderm) 0 25 0 Removed.
67810 SB011 drape, sterile, fenestrated 16 in × 29 in 0 1 0 Removed.
72192 SK076 slide sleeve (photo slides) 0 1 0 Removed.
SK098 film, x-ray, laser print 0 8 4 Removed.
72193 SH065 sodium chloride 0.9% flush syringe 0 15 1 Removed.
SK076 slide sleeve (photo slides) 0 1 0 Removed.
74150 SK076 slide sleeve (photo slides) 0 1 0 Removed.
SK098 film, x-ray, laser print 0 8 4 Removed.
74160 SH065 sodium chloride 0.9% flush syringe 0 15 1 Removed.
74170 SH065 sodium chloride 0.9% flush syringe 0 15 1 Removed.
92081 EL006 lane, screening (oph) 12 17 12 Maintain refinement/Standard Time.
92082 EL006 lane, screening (oph) 22 27 22 Maintain refinement/Standard Time.
92083 EL006 lane, screening (oph) 32 37 32 Maintain refinement/Standard Time.
93017 L051A RN Complete diagnostic forms, lab & X-ray requisitions 0 4 0 Removed.

(2) Integumentary System: Skin, Subcutaneous, and Accessory Structures (CPT Codes 11300, 11301, 11302, 11303, 11305, 11306, 11307, 11308, 11310, 11311, 11312, 11313)

In establishing interim final direct PE inputs for CY 2013, CMS refined the AMA RUC's recommendation for CPT codes 11300 (Shaving of epidermal or dermal lesion, single lesion, trunk, arms or legs; lesion diameter 0.5 cm or less), 11301 (Shaving of epidermal or dermal lesion, single lesion, trunk, arms or legs; lesion diameter 0.6 to 1.0 cm), 11302 (Shaving of epidermal or dermal lesion, single lesion, trunk, arms or legs; lesion diameter 1.1 to 2.0 cm), 11303 (Shaving of epidermal or dermal lesion, single lesion, trunk, arms or legs; lesion diameter over 2.0 cm), 11305 (Shaving of epidermal or dermal lesion, single lesion, scalp, neck, hands, feet, genitalia; lesion diameter 0.5 cm or less), 11306 (Shaving of epidermal or dermal lesion, single lesion, scalp, neck, hands, feet, genitalia; lesion diameter 0.6 to 1.0 cm), 11307 (Shaving of epidermal or dermal lesion, single lesion, scalp, neck, hands, feet, genitalia; lesion diameter 1.1 to 2.0 cm), 11308 (Shaving of epidermal or dermal lesion, single lesion, scalp, neck, hands, feet, genitalia; lesion diameter over 2.0 cm), 11310 (Shaving of epidermal or dermal lesion, single lesion, face, ears, eyelids, nose, lips, mucous membrane; lesion diameter 0.5 cm or less), 11311 (Shaving of epidermal or dermal lesion, single lesion, face, ears, eyelids, nose, lips, mucous membrane; lesion diameter 0.6 to 1.0 cm), 11312 (Shaving of epidermal or dermal lesion, single lesion, face, ears, eyelids, nose, lips, mucous membrane; lesion diameter 1.1 to 2.0 cm), and 11313 (Shaving of epidermal or dermal lesion, single lesion, face, ears, eyelids, nose, lips, mucous membrane; lesion diameter over 2.0 cm) by removing “electrocautery-hyfrecator, up to 45 watts” (EQ110), and “cover, probe (cryosurgery)” (SB003), among other refinements.

Comment: Commenters noted that there is an “inherent and persistent risk of bleeding” during these procedures, and that the electrocautery-hyfrecator needs to be readily available to prevent excessive blood loss and is typically included in the surgical field. These commenters explained that the item, “cover, probe (cryosurgery)” is the generic sterile sheath that covers the electrocautery-hyfrecator pen-handle and cable, and therefore required to be used with the electrocautery-hyfrecator.

Response: In our clinical review, we reviewed the work vignettes for these procedures, which did not include the use of the electrocautery-hyfrecator as a part of the procedure. Although we acknowledge that the electrocautery-hyfrecator needs to be readily available during the procedure, we note that “standby” equipment, or items that are not used in the typical case, are considered indirect costs. For further discussion of this issue, we refer readers to our discussion of “standby” equipment in the CY 2001 PFS proposed rule (65 FR 44187). With regard to the “cover, probe (cryosurgery)”, this item is a disposable supply that would only be used with each patient if the electrocautery-hyfrecator is in the sterile field during all procedures. We do not have information to suggest that the electrocautery-hyfrecator is typically in the sterile field, so we are not including the supply item “cover, probe (cryosurgery)” in the direct PE database for this service. After consideration of the comments received, we are finalizing the CY 2013 interim final direct PE inputs for 11300-11313 as established.

(3) Integumentary System: Repair (Closure) (CPT Codes 13100, 13101, 13102, 13120, 13121, 13122, 13131, 13132, 13133, 13152, and 13153)

In establishing interim final direct PE inputs for CY 2013, CMS refined the AMA RUC's recommendations for CPT codes 13100 (Repair, complex, trunk; 1.1 cm to 2.5 cm), 13101 (Repair, complex, trunk; 2.6 cm to 7.5 cm), 13102 (Repair, complex, trunk; each additional 5 cm or less (list separately in addition to code for primary procedure)), 13120 (Repair, complex, scalp, arms, and/or legs; 1.1 cm to 2.5 cm), 13121 (Repair, complex, scalp, arms, and/or legs; 2.6 cm to 7.5 cm), 13122 (Repair, complex, scalp, arms, and/or legs; each additional 5 cm or less (list separately in addition to code for primary procedure)), 13131 (Repair, complex, forehead, cheeks, chin, mouth, neck, axillae, genitalia, hands and/or feet; 1.1 cm to 2.5 cm), 13132 (Repair, complex, forehead, cheeks, chin, mouth, neck, axillae, genitalia, hands and/or feet; 2.6 cm to 7.5 cm), 13133 (Repair, complex, forehead, cheeks, chin, mouth, neck, axillae, genitalia, hands and/or feet; each additional 5 cm or less (list separately in addition to code for primary procedure)), 13150 (Repair, complex, eyelids, nose, ears and/or lips; 1.0 cm or less), 13151 (Repair, complex, eyelids, nose, ears and/or lips; 1.1 cm to 2.5 cm), 13152 (Repair, complex, eyelids, nose, ears and/or lips; 2.6 cm to 7.5 cm), and 13153 (Repair, complex, eyelids, nose, ears and/or lips; each additional 5 cm or less (list separately in addition to code for primary procedure)) by removing duplicative items, among other refinements.

Comment: A few commenters argued that the majority of procedures reported using CPT codes 13100, 13101, 13120, 13121, 13131, 13132, 13150, 13151, and 13153 are furnished under local anesthesia, delivered by subcutaneous injection, and therefore typically require “needle, 18-27g” (SC029). Commenters also pointed out that the second “gown, staff, impervious” (SB027) and “mask, surgical” (SB033) are not duplicative, but required, because an assistant at surgery is allowed for these surgeries in some cases, and OSHA requirements mandate that health care workers be protected from blood exposure. Commenters stated that they did not believe these procedures could be furnished without these inputs.

Response: Based on the rationale provided by commenters, we agree that the needle should be included as a direct PE input for this family of codes. However, we continue to believe that a second gown and mask are not typical because our claims data show that an assistant at surgery is rarely, if ever, used for these services.

After consideration of the comments received, we are finalizing the CY 2013 interim final direct PE inputs for 13100-13153 with the additional refinement of incorporating the “needle, 18-27g” (SC029) as recommended by commenters.

(4) Integumentary System: Nails (CPT Code 11719)

In establishing interim final direct PE inputs for CY 2013, we refined the AMA RUC recommendation for CPT code 11719 by adjusting the times allocated for clinical labor tasks as follows: “Provide preservice education/obtain consent” from 2 minutes to 1 minute, “Greet patient, provide gowning, assure appropriate medical records are available” from 3 minutes to 1 minute, “Prepare room, equipment, supplies” from 2 minutes to 1 minute, and “Clean room/equipment by physician staff” from 3 minutes to 1 minute, among other refinements.

Comment: A commenter objected to our refinements to this clinical labor task, and argued that one minute of “provide preservice education/obtain consent” is inadequate to review the advanced beneficiary notice (ABN) and answer patient questions. This commenter also objected to our decreasing the number of minutes associated with the other clinical labor activities to below the AMA-RUC recommended standard minutes.

Response: We believe that the time assigned to “provide preservice education/obtain consent” appropriately reflects the resources required in furnishing the typical procedure and thus are not making the change requested, particularly since five minutes of preservice physician time are also included for the service. We also would not expect an ABN to be provided in the typical case. We agree with commenters that we should allocate the standard number of minutes for the remaining clinical labor activities and have adjusted the direct PE database accordingly.

Comment: One commenter suggested that it was typical to position a patient in a power table/chair in lieu of an exam table when furnishing this service.

Response: CMS clinical staff reviewed CPT code 11719 in the context of this comment. We do not believe that it is typical that a power table/chair would be used for these procedures. After considering the comments received, we are finalizing the CY 2013 interim final direct PE inputs for CPT code 11719 as established, with the exception of increasing the minutes assigned to clinical labor activities to the standard number of minutes.

(5) Arthrocentesis (CPT Codes 20600, 20605, 20610)

In establishing direct PE inputs for CY 2013, we refined the AMA RUC's recommendations for CPT codes 20600 (Arthrocentesis, aspiration and/or injection; small joint or bursa (eg, fingers, toes), 20605 (Arthrocentesis, aspiration and/or injection; intermediate joint or bursa (eg, temporomandibular, acromioclavicular, wrist, elbow or ankle, olecranon bursa)), and 20610 (Arthrocentesis, aspiration and/or injection; major joint or bursa (eg, shoulder, hip, knee joint, subacromial bursa)) by removing the minutes associated with the clinical labor activity “discharge day management” and replacing these minutes with “conduct phone calls/call in prescriptions” in the facility setting.

Comment: Commenters requested clarification as to whether the time allocated for “conduct phone calls/call in prescriptions” is limited to the facility setting or is also included in the non-facility setting.

Response: The AMA RUC recommendation included “conduct phone calls/call in prescriptions” in the nonfacility setting and we did not refine this recommendation. Therefore, this activity is included in the inputs for the nonfacility setting as well.

Comment: One commenter suggested it was typical for a physician to position a patient in a power table/chair in lieu of an exam table when furnishing 20600 and 20605.

Response: Our clinical staff reviewed CPT codes 20600 and 20605 in the context of this comment. We do not believe that it is typical that a power table/chair would be used for these procedures. After considering the comments received, we are finalizing the CY 2013 interim final direct PE inputs for CPT codes 20600, 20605, and 20610 as established.

(6) Respiratory System: Accessory Sinuses (CPT Code 31231)

In establishing interim final direct PE inputs for CY 2013, we refined the AMA RUC's recommendation for CPT code 31231 (Nasal endoscopy, diagnostic, unilateral or bilateral (separate procedure)) by removing the second “endoscope, rigid, sinoscopy” (ES013) from the inputs for the service, refining the equipment time to reflect typical use exclusive to the patient, and removing the time allocated to preservice clinical labor tasks, among other refinements.

Comment: A commenter disagreed with our removal of the second endoscope, arguing that the second scope is medically necessary because the first scope (zero degree rigid scope) does not allow visualizing above or behind all the normal structures of the nasal vault such as superior turbinate and the frontal recess. The second scope (for example, a 30, 45 or 70 degree scope) is used more than 51 percent of the time.

Response: We agree with the commenter that the second scope is used in the typical case, and based on this comment; we are adding the second scope to the direct PE inputs for the service.

Comment: A commenter disagreed with our refinements to the equipment time for this service, and stated that the entire clinical labor service period time of 63 minutes, and at a minimum, 43 minutes, should be allocated to all equipment used in this procedure.

Response: In general, for equipment that we do not consider to be highly technical, we allocate the entire service period time, with the exception of the time allocated for cleaning of other, portable pieces of equipment. Therefore, we agree with the commenter that the equipment times should be modified, but do not agree with the commenter that 63 minutes should be allocated. Instead, we are modifying the time allocated for the equipment in this procedure by assigning 53 minutes to the instrument pack to reflect the intraservice time other than cleaning of the scopes, 48 minutes to the scopes to reflect the intraservice time other than the cleaning of the instrument pack, and 38 minutes to the remaining equipment items, which reflects the entire intraservice clinical labor time except for the time allocated for cleaning the portable equipment items instrument pack and scope.

Comment: Commenters argued that the preservice clinical labor tasks included in the RUC recommendation should have been maintained in this procedure.

Response: This procedure is typically billed with an E/M service, and the preservice tasks are already included as direct PE inputs for the E/M services. Therefore, we believe that including these items again in CPT 31231 would be duplicative.

After consideration of public comments, we are finalizing the CY 2013 interim final direct PE inputs for 31231 as established with the additional refinements of adding in the second scope as an equipment item and adjusting the equipment times as discussed above.

(7) Respiratory System: Lungs and Pleura (CPT Codes 32554, 32555, and 32557)

In establishing interim final direct PE inputs for CY 2013, we refined the AMA RUC's recommendation for CPT codes 32554 (Removal of fluid from chest cavity), 32555 (Removal of fluid from chest cavity with imaging guidance), and 32557 (Removal of fluid from chest cavity with insertion of indwelling catheter and imaging guidance), by inserting supply item “kit, pleural catheter insertion” (SA077) and refining the equipment times to reflect the typical use exclusive to the patient.

Comment: Commenters indicated that a tunneled catheter is not used during this procedure, so that the pleural catheter insertion kit is not an accurate supply item to use as the thoracentesis kit (SA113). The commenter also pointed out that the price of the thoracentesis kit that appears in the direct PE input database appeared to be inaccurately priced at $260.59. The commenter pointed out that the price listed in the database reflects an invoice that includes ten units, so that the accurate price for the items is $26.06.

Response: Based on the information provided by commenters, we agree that supply item “Kit, thoracentesis” (SA113) would be more appropriate than “kit, pleural catheter insertion” (SA077) and we agree that the correct price for the item is $26.06. We have updated this price in the direct PE input database accordingly.

Comment: Commenters stated that the time allocated to equipment items “room, ultrasound, general” (EL015) and “room, CT” (EL007), as well as “light, exam” (EQ168) should reflect the time for tasks during which the room is not available to other patients; specifically, for CPT code 32555, 33 minutes should be assigned to EL015, and for CPT code 32557, 45 minutes should be assigned to EL007 and EQ168.

Response: We agree with commenters that it is consistent with our stated policy to allocate time for highly technical equipment for preparing the room, positioning the patient, acquiring images, and cleaning the room. Therefore, for CPT code 32555, we are assigning 33 minutes to “room, ultrasound, general” (EL015), and for CPT code 32557, we are assigning 45 minutes to “room, CT” (EL007) and “light, exam” (EQ168).

After reviewing the public comments received, we are finalizing the CY 2013 interim final direct PE inputs for CPT codes 32554, 32555, and 32557 as established with the additional refinements of including and updating the price of the “kit, thoracentesis” (SA113) supply item and adjusting the equipment times as commenters recommended.

(8) Cardiovascular System: Heart and Pericardium (CPT Codes 33361, 33362, 33363, 33364, 33365, and 33405)

In establishing interim final direct PE inputs for CY 2013, we refined the AMA RUC's recommendation for CPT codes 33361, 33362, 33363, 33364, and 33365 by refining the time allocated to clinical labor tasks in the preservice and postservice periods to be consistent with the standards for adjusted 000-day global services.

Comment: Commenters stated that these services are furnished in a facility setting, requiring a fully equipped operating room or hybrid suite. The commenter detailed the various clinical labor tasks that are needed for these procedures, and noted that the requirements are similar to those of 90-day global procedures.

Response: We agree with commenters that it would be appropriate to allocate the standard 90-day global clinical labor inputs for these services. After consideration of public comments, we are finalizing the CY 2013 interim final direct PE inputs for CPT codes 33361-33365 as established, with the additional refinement of replacing the current times for clinical labor tasks with those of the standard 90-day global inputs.

We also refined the direct PE inputs for CPT code 33405 by removing the clinical labor activity, “Additional coordination between multiple specialties for complex procedures (tests, meds, scheduling, etc.) prior to patient arrival at site of service.”

Comment: A commenter stated that inclusion of the time allocated for this additional coordination activity is consistent with other major surgical procedures, and that removing it would create an anomaly with other cardiac procedures.

Response: We do not agree that it is appropriate to include these “additional coordination” tasks as inputs to this procedure. We thank the commenter for bringing to our attention the potential anomaly created by having this activity included in other procedures and will consider any relativity issues regarding clinical labor preservice minutes allocated for other procedures in future rulemaking. After consideration of the comments received, we are finalizing the CY 2013 direct PE inputs for CPT code 33405 as established.

(9) Cardiovascular System: Arteries and Veins (CPT Codes 36221, 36222, 36223, 36224, 36225, 36226, 36227, 36228, and 37197)

In establishing interim final direct PE inputs for CY 2013, we refined the AMA RUC's recommendation for CPT codes 36221 (Insertion of catheter into chest aorta for diagnosis or treatment), 36222 (Insertion of catheter into neck artery for diagnosis or treatment), 36223 (Insertion of catheter into neck artery for diagnosis or treatment), 36224 (Insertion of catheter into neck artery for diagnosis or treatment), 36225 (Insertion of catheter into chest artery for diagnosis or treatment), 36226 (Insertion of catheter into chest artery for diagnosis or treatment), and 36227 (Insertion of catheter into neck artery for diagnosis or treatment) by substituting equipment item “table, instrument, mobile” (EF027) for equipment item “Stretcher” (EF018), refining equipment time to reflect typical use exclusive to the patient for equipment items “room, angiography” (EL011), “contrast media warmer” (EQ088), and “film alternator (motorized film viewbox)” (ER029), and removing the recommended minutes based on the clinical labor task described as “image post processing” from CPT code 36221, among other refinements.

Comment: Commenters stated that they believed that the removal of the stretcher was an error because a stretcher is necessary for these cerebral angiography codes and requested that the stretcher be included as an input for these procedures.

Response: We do not agree with commenters that it is appropriate to include a stretcher for this family of codes. The inclusion of a stretcher is not consistent with the AMA RUC-recommended standardized nonfacility direct PE inputs that account for moderate sedation as typically furnished as a part of such service, which we used as the basis for proposing and finalizing a standard package of direct PE inputs for moderate sedation during CY 2012 rulemaking. For further discussion of this issue, we refer readers to the CY 2012 PFS rule (76 FR 73044).

Comment: Commenters stated the CMS refinement for equipment minutes was inappropriate, and that the equipment time for “room, angiography” (EL011), “contrast media warmer” (EQ088), and “film alternator (motorized film viewbox)” (ER029) should include the clinical labor tasks of “prepare room,” “prepare and position patient,” “sedate patient,” “assist physician/acquire images,” and “clean room.” Specifically, commenters requested that we adjust the time for all equipment items as follows: 49 minutes for CPT code 36221, 59 minutes for CPT code 36222, 64 minutes for CPT code 36223, 69 minutes for CPT code 36224, 64 minutes for CPT code 36225, and 69 minutes for CPT code 36226.

Response: We agree with commenters that the time allocated to the equipment should account for these tasks. We are adjusting the equipment times for “room, angiography” (EL011), “contrast media warmer” (EQ088), and “film alternator (motorized film viewbox)” (ER029) to those identified by the commenters and described above.

Comment: A commenter noted that “image post processing” often appears as a clinical labor task activity on the PE worksheet and that the task is integral to patient care for the services described by these codes. Commenters requested that we include these clinical labor tasks for these procedures.

Response: Upon further review of similar codes, we agree with the commenter that it is consistent with other services in this family to include clinical labor minutes based on the “image post processing” task. After consideration of public comments, we are finalizing the CY 2013 interim final direct PE inputs for CPT codes 36221-36227 as established with the additional refinements of the adjusted equipment and clinical labor times noted above.

We also refined the AMA RUC's recommendation for direct PE inputs for CPT code 36228 (Insertion of catheter into neck artery for diagnosis or treatment) by removing 1 minute of clinical labor time, based on the task called “prepare room, equipment, and supplies,” and 1 minute for “assisting with fluoroscopy/image acquisition.” We also refined the recommendation by not including the supply item “syringe, 5-6 ml” (SC075).

Comment: Commenters stated that the additional minute for “prepare room, equipment, and supplies” is necessary for this add-on code. They also requested that we adjust the time for acquiring images as well. Commenters also stated that the syringe is necessary to safely inject micro-catheters and should be included.

Response: We do not agree with commenters that an additional minute should be added to the clinical labor time for this add-on code to account for additional time to “prepare the room, equipment, and supplies.” As we stated in the CY 2013 PFS final rule with comment period (77 FR 68933), we believe that preparing the room would not typically be duplicated when furnishing a subsequent procedure to the same patient on the same day, and we believe that the standard number of minutes allocated on the basis of the clinical labor task accounts for the typical amount time spent preparing the items for the primary procedure, regardless of whether or not a separate code is reported for some cases. However, based on the commenters' explanation, we agree that an additional minute for image acquisition is typical when the add-on code is reported. We also agree that the syringe is necessary for this procedure.

After reviewing public comments received, we are finalizing the CY 2013 direct PE inputs for CPT code 36228 as established with the additional refinements to the clinical labor and supply items noted above.

In establishing interim final direct PE inputs for CY 2013, we refined the AMA RUC's recommendation for CPT code 37197 (Retrieval of intravascular foreign body) by removing equipment items “ultrasound unit, portable” (EQ250) and “contrast media warmer” (EQ088), and supply items “sheath-cover, sterile, 96in x 6in (transducer)” (SB048), “catheter, (Glide)” (SD147), “guidewire, Amplatz wire 260 cm” (SD252), and “sodium chloride 0.9% flush syringe” (SH065).

Comment: Commenters indicated that the portable ultrasound unit is necessary to gain vascular access, the contrast media warmer is necessary for the procedure, and the supply items we refined from the AMA RUC recommendation are also required for the procedures since the foreign body cannot be removed without these items.

Response: We do not agree that the portable ultrasound unit should be included as a direct PE input for this procedure. The CPT description of this code states that either fluoroscopy or ultrasound is used; the angiography room accounts for the resources associated with fluoroscopy. When fluoroscopy is used, these resources are appropriately accounted for. In the event that a portable ultrasound unit is used in place of fluoroscopy, the resource costs would be significantly overestimated, since a portable ultrasound unit is far less expensive than the angiography room. Therefore, we continue to believe that the PE inputs adequately account for the resource costs used for imaging in this procedure. We also continue to believe that the supply items we refined from the AMA RUC recommendation are duplicative since the inputs for this service already include supply items that are used for removing the foreign body during the procedure. We agree with commenters that the contrast media warmer should be included in the procedure, and are including this equipment item as a direct PE input for this service.

After consideration of these comments, we are finalizing the CY 2013 interim final direct PE inputs for CPT code 37197 as established with the additional refinement of adding the equipment item “contrast media warmer” (EQ088), as noted above.

(10) Digestive System: Intestines (Except Rectum) (CPT Code 44705 and HCPCS Code G0455)

In establishing interim final direct PE inputs for CY 2013, CMS crosswalked the inputs from 44705 (Prepare fecal microbiota for instillation, including assessment of donor specimen) to G0455 (Preparation with instillation of fecal microbiota by any method, including assessment of donor specimen), and incorporated a minimum multi-specialty visit pack (SA048) and an additional 17 minutes of clinical labor time in the service period based on the amount of time allocated for clinical labor tasks in the direct PE inputs for E/M services. In the CY 2013 final rule with comment period, we noted that Medicare would only pay for the preparation of the donor specimen if the specimen is ultimately used for the treatment of a beneficiary. Accordingly, we bundled preparation and instillation into a HCPCS code, G0455, to be used for Medicare beneficiaries instead of the new CPT code 44705 (Preparation of fecal microbiota for instillation, including assessment of donor specimen), which we assigned a PFS procedure status indicator of I (Not valid for Medicare purposes). G0455 includes both the work of preparation and instillation of the microbiota.

Comment: A commenter asserted that CMS listed G0455 as having a PE RVU of 2.48 without explaining how this value was derived.

Response: In the CY 2013 PFS final rule with comment period (77 FR 69073), we described how we established the direct PE inputs for G0455. Specifically, we stated that we used the AMA RUC-recommended nonfacility PE inputs for CPT code 44705, in addition to 17 minutes of clinical labor time and a “minimum multi-specialty visit pack” (SA048), to account for both the preparation and instillation. The PE RVU of 2.48 results from the standard methodology outlined in PFS rules in the section entitled “Resource-Based Practice Expense (PE) Relative Value Units (RVUs)” (see, for example, 77 FR 68899). After consideration of the public comment, we are finalizing the interim final direct PE inputs for HCPCS code G0455 as established.

(11) Digestive System: Biliary Tract (CPT Codes 47600 and 47605)

In establishing interim final direct PE inputs for CY 2013, we refined the AMA RUC's recommendation for CPT codes 47600 (Removal of gallbladder) and 47605 (Removal of gallbladder with X-ray study of bile ducts) by replacing the supply item “pack, post-op incision care (suture & staple)” (SA053) with supply item “pack, post-op incision care (suture)” (SA054).

Comment: Commenters stated that although sutures and staples are sometimes both used, at a minimum, staples are used in this procedure. Therefore, commenters requested that, as a minimum, we include the staple removal pack.

Response: We agree with the commenters that the staple removal pack (SA052) should be included instead of the suture pack. After consideration of these comments, we are finalizing the CY 2013 interim final direct PE inputs for CPT codes 47600 and 47605 as established, with the additional refinement of substituting the staple removal pack (SA052) for the suture removal pack (SA054).

(12) Urinary System: Bladder (CPT Codes 52214, 52224, and 52287)

In establishing the interim final direct practice expense inputs for CY 2013 for CPT code 52214, we refined the AMA RUC recommendation to remove supply items “drape-towel, sterile, 18in × 26in” (SB019),” “lidocaine 1%-2% inj (Xylocaine)” (SH047), and “penis clamp.”

Comment: Commenters indicated that the supply item “drape-towel, sterile, 18in x 26in,” is used on the instrument table and that the supply item “lidocaine 1%-2% inj (Xylocaine)” (SH047), is used to instill into the bladder as a numbing agent. Commenters also indicated that the item “penis clamp” is required to keep the lidocaine in the penile urethra.

Response: We agree with commenters that the drape towel and lidocaine should be included in this procedure. However, we do not agree that the reusable penis clamp, even when typically used, should be included in the direct PE input database for this procedure. Since the item is reusable, the resource cost associated with the item is not considered to be a direct PE supply input. Given the price associated with the item, the cost per minute over several years of useful life becomes negligible relative to the other costs accounted for in the PE methodology. We refer readers to a discussion of equipment items under $500 in the NPRM for CY 2005 (69 FR 47494). We note that including such items as equipment in the direct PE input database would not impact the PE RVU values.

In establishing the interim final direct practice expense inputs for CY 2013, we refined the AMA RUC recommendation for CPT code 52224 by adjusting the equipment time for “fiberscope, flexible, cystoscopy” (ES018) to 94 minutes, adjusting the clinical labor activity “prepare biopsy specimen” to 2 minutes, and adjusting the quantity of the supply item “gloves, sterile” (SB024) to 1 pair, and “cup, biopsy-specimen sterile 4oz” (SL036) to 3, among other refinements.

Comment: Commenters stated that the time for this equipment item should include all standard tasks, in addition to the cleaning of the scope. Commenters also noted that, depending upon the number of biopsies, the preparation of the specimen can take more than 2 minutes, that a minimum of 3 pairs of gloves are required, and that biopsy specimens are submitted in several containers.

Response: We re-examined the time for the fiberscope and agree with commenters that the time should include all time associated with standard tasks and cleaning the scope. We are therefore adjusting the time for this equipment item to 97 minutes. We continue to believe that 2 minutes represents the typical time required to prepare the specimen and are not adjusting the time. We agree with commenters that more than 1 pair of gloves may be required; however, since a biopsy is not required in all cases, we believe that 2 pairs of gloves accounts for the resources used in furnishing the typical service. Finally, we continue to believe that 3 containers represent the typical resources used in furnishing this procedure given the small size of the lesions. After considering the comments received, we are finalizing the CY 2013 interim final direct PE inputs for CPT code 52224 as established with the additional refinement of adjusting the equipment time to account for cleaning the scope, and adding one pair of gloves, as noted above.

In establishing interim final direct PE inputs for CY 2013, we refined the AMA RUC's recommendation for CPT code 52287 by adjusting the time for the clinical labor activity “assist physician in performing procedure” from 20 minutes to 21 minutes to conform to the physician intraservice time, and refining the equipment time to reflect the typical use exclusive to the patient.

Comment: The AMA RUC stated that its original submission to CMS contained 21 minutes for this clinical labor activity. Another commenter noted that the times allocated to preservice clinical labor tasks were missing in the nonfacility setting. Another commenter stated that the equipment time should include the time for all of the standard clinical labor tasks.

Response: We note that the AMA RUC and CMS agree on the appropriate number of minutes to assign to the clinical labor service period to account for “assist physician.” Regarding the preservice clinical labor tasks, we note that the AMA RUC did not recommend preservice clinical labor time for these tasks in the nonfacility setting, and that such inputs are not standard for 000-day global services. With respect to equipment time, we agree with commenters that the equipment time for all equipment in this procedure should include time for all of the standard clinical labor tasks, with the exception of the time allocated for cleaning of the scope. The times for the equipment items included in CPT code 52287 already include all of these tasks, with the exception of “fiberscope, flexible, cystoscopy” (ES018). We are adjusting time for the scope from 76 to 78 minutes to align the equipment time with that of the standard clinical labor tasks.

After considering the comments received, we are finalizing the CY 2013 interim final direct PE inputs for CPT code 52287 as established with the additional refinement of adjusting the equipment time as noted above.

(13) Transurethral Destruction of Prostate Tissue (CPT Code 53850)

In establishing interim final direct PE inputs for CY 2013, we refined the AMA RUC's recommendation for CPT code 53850 by refining equipment time to reflect typical use exclusive to the patient.

Comment: A commenter stated that the equipment time should include the time for all of the standard clinical labor tasks.

Response: We agree with the commenter that the equipment time for all equipment in this procedure should include time for all of the standard clinical labor tasks, and we are allocating the entire service period of 99 minutes for “stretcher, endoscopy” (EF020), “table, instrument, mobile” (EF027), “TUMT system control unit” (EQ037), and “ultrasound unit, portable” (EQ250), which are used during the service period only. In addition, we are allocating 169 minutes for items used during both the service period and postservice period, which are “table, power” (EF031) and “light, exam” (EQ168), to account for both the service period and postservice period.

We also refined the AMA recommendation for this code by not assigning additional clinical labor minutes for non-standard clinical labor tasks described as “setup ultrasound probe,” “setup TUMT machine,” and “clean TUMT machine.”

Comment: The same commenter also stated that the clinical labor tasks were necessary because extra time was required.

Response: We do not agree that the time for these clinical labor tasks is reflective of typical resource costs involved in furnishing the service. For this procedure the assigned clinical labor time already includes the standard number of minutes for set-up and clean-up, and the commenter provided no information justifying a deviation from these standard times for this procedure.

Comment: A commenter stated that there is no preservice clinical staff time assigned for the nonfacility, and that the clinical labor time should account for tasks such as “setting up the room,” “greeting patient,” and “position patient prior to the procedure.”

Response: The clinical labor tasks referred to by the commenter are tasks generally included in service period activities; the preservice clinical staff time that is included when the procedure is done in the facility includes scheduling and coordination services that are unique to procedures furnished in facility settings. The service period time for this procedure includes minutes allocated for clinical labor tasks such as “greet patient,” “provide gowning,” “ensure appropriate medical records are available,” and “prepare and position patient.” Therefore, we are not making a change at this time and are finalizing the CY 2013 interim final direct PE inputs for CPT code 53850, including the clinical labor tasks, as established.

(14) Nervous System: Extracranial Nerves, Peripheral Nerves, and Autonomic Nervous System (CPT Code 64615)

In establishing interim final direct PE inputs for CY 2013, we accepted the AMA RUC's recommendation for CPT code 64615 (Injection of chemical for destruction of facial and neck nerve muscles).

Comment: A commenter questioned why this service had only 3 minutes of postservice clinical labor time, while other codes in the family have 27 or 30 minutes.

Response: The apparent discrepancy between CPT code 64615 and the other codes in the family results because CPT 64615 does not have any post-operative visits in the global period while the other codes in the family have post-operative visits. Specifically, the 30 minutes of postservice clinical labor time in 64612 are allocated specifically for the post-operative visits. After consideration of public comment, we are finalizing the CY 2013 interim final direct PE inputs for CPT code 64615 as established.

(15) Diagnostic Radiology: Abdomen and Pelvis (CPT Codes 72191, 72192, 72193, 72194, 74150, 74160, 74170, 74175, 74176, 74177, 74178)

In establishing interim final direct PE inputs for CY 2013, we reviewed the direct PE inputs for all of the abdomen, pelvis, and abdomen/pelvis combined CT codes. For each set of codes, we established a common set of disposable supplies and medical equipment. We established clinical labor minutes that reflect the fundamental assumption that the component codes should include a base number of minutes for particular tasks, and that the number of minutes in the combined codes should reflect efficiencies that occur when the regions are examined together. Among other refinements, we adjusted the intraservice time for CPT codes 72194, 74160, and 74177 by 2 minutes, 4 minutes, and 6 minutes respectively.

Comment: Commenters stated that more information was required about from where CMS decreased the minutes from the service period for CPT codes 72194, 74160, and 74177.

Response: We refined the minutes in the service period such that the aggregate number of clinical labor minutes reflected in the direct PE input database and used to develop PE RVUs was consistent within this family of codes. We believe that the aggregate clinical labor time in each clinical service period (preservice period, service period, and postservice period) or aggregate number of minutes for particular equipment items that reflects the total typical resource use is more important than the minutes associated with each clinical labor task, which are a tool used by the AMA RUC to develop their recommendations. We hope that in reviewing future services, commenters consider the aggregate clinical labor time as well, recognizing that it is the aggregate time that ultimately has implications for payment. Finally, we welcome comments that address the appropriateness of the number of clinical labor minutes in each service period and the number of equipment minutes for each service.

In this refinement process, we also removed supply item “needle, 18-27g” (SC029) and replaced it with “needle, 14-20g, biopsy” (SC025) for CPT codes 72193, 72194, 74160, and 74170.

Comment: Commenters stated that the biopsy needle (SC025) was not appropriate for these services, and that supply item “needle, 18-27g” (SC029) would be more appropriate. In addition, commenters noted that the “film processor” (ED024) is in use during a portion of the service.

Response: We agree with commenters that the “needle, 18-28g” (SC029) is more appropriate for these services, and that the film processor should be included for these codes. We are adjusting the direct PE inputs to include the needle and film processor in CPT codes 72193, 72194, 74160, and 74170.

In refining the direct PE inputs, we also substituted a radiologic technologist for a CT technologist for CPT codes 72191 and 74175, and removed the clinical labor time for “Retrieve prior appropriate imaging exams and hang for MD review, verify orders, review the chart to incorporate relevant clinical information” from 72191, 74170, and 74175.

Comment: Commenters stated that a CT technologist was the typical clinical labor type for these CT procedures. Commenters also objected to the removal of recommended minutes based on the clinical labor activity “Retrieve prior appropriate imaging exams and hang for MD review, verify orders, review the chart to incorporate relevant clinical information” from CPT codes 72191, 74170, and 74175, and to the reduction of preservice and intraservice clinical labor time in this family of codes.

Response: Based on the information provided by commenters, we agree that CPT codes 72191 and 74175 should include a CT technologist rather than a radiologic technologist for CPT codes 72191 and 74175 because the CT technologist is typical. However, we do not agree that the clinical labor time should be changed per the commenters' request, as we continue to believe that these tasks are already captured in the preservice clinical labor time. We refer readers to the CY 2013 PFS final rule with comment period (77 FR 69073) for a discussion of the development of a standard allocation of inputs for these families of codes.

For CPT code 72191, we refined the time for equipment item “room, CT” (EL007) to 40 minutes.

Comment: Commenters stated that the CT room time for should be at least 43 minutes to include time for cleaning the room.

Response: We agree with commenters that the time for the CT room should be 43 minutes to include the standard clinical labor tasks for highly technical equipment, including cleaning the room.

After considering the comments received, we are finalizing the CY 2013 interim final direct PE inputs for CPT codes 72193, 72194, 73221, 73721, 74150, 74160, 74170, 74175, 74176, and 74177 as established with the additional refinements of the supply item, changes to clinical labor staff type, and equipment time noted above.

(16) Diagnostic Ultrasound: Transvaginal and Transrectal Ultrasound (CPT Codes 76830 and 76872)

In establishing interim final direct PE inputs for CY 2013, we refined the AMA RUC's recommendation for CPT code 76830 by removing the equipment item “room, ultrasound, general” (EL015) and replacing it with individual items including a portable ultrasound unit.

Comment: A commenter noted that a panel of obstetrician/gynecologists, a specialty that frequently furnishes this service, indicated that a dedicated ultrasound room was used.

Response: Based on the comments we received, we agree that it would be more appropriate to allocate a general ultrasound room for this procedure rather than a portable ultrasound unit and accompanying items. We are including the ultrasound room as a direct PE input for CPT code 76830.

In refining the inputs for CPT code 76830, we also removed “film alternator (motorized film viewbox)” (ER029), “Surgilube lubricating jelly” (SJ033), and “film processor, dry, laser” (ED024).

Comment: Another commenter stated that the film alternator and Surgilube lubricating jelly are required; however, the specialty that most frequently furnishes the service stated that they did not use either of these items.

Response: We continue to believe that neither the film alternator nor the lubricating jelly should be included for this service as, and after considering the comments from the specialty that most frequently furnishes the service, we agree that these are not used in the typical case.

After considering the comments received, we are finalizing the CY 2013 interim final direct PE inputs for CPT code 76830 as established with the additional refinement of allocating a general ultrasound room and removing individual inputs related to a portable ultrasound unit.

In establishing interim final direct PE inputs for CY 2013, we refined the AMA RUC's recommendation for CPT code 76872 by adjusting the equipment time to reflect the typical use exclusive to the patient, and removing clinical labor tasks, “obtain vital signs,” and “prepare ultrasound probe” from the preservice period; removing “obtain vital signs” from the service period; and removing supply items “drape, sterile, for Mayo stand” (SB012), “iv tubing (extension)” (SC019), “lidocaine 2% jelly, topical (Xylocaine)” (SH048), “alcohol isopropyl 70%” (SJ001), “lubricating jelly (K-Y) (5gm uou)” (SJ032), “glutaraldehyde 3.4% (Cidex, Maxicide, Wavicide)” (SM018), “glutaraldehyde test strips (Cidex, Metrex)” (SM019), and “sanitizing cloth-wipe (surface, instruments, equipment)” (SM022).

Comment: Commenters indicated that the equipment time allocated for this procedure should be 68 minutes to reflect the time that the equipment is unavailable for other patients.

Response: We agree with commenters that the equipment time for all equipment in this procedure should include time for all of the standard clinical labor tasks in the service period, so we are allocating 42 minutes for those equipment items.

Comment: Commenters noted that it is necessary to obtain vital signs prior to the service, and that the supplies were necessary for a variety of purposes outlined in the comment.

Response: We do not agree that it is necessary to obtain vital signs in the preservice period in order to determine if the patient becomes hypotensive during the service period, but agree that obtaining vital signs in the service period is necessary. We note that we have standard setup times for equipment and do not generally allocate separate time for preparing individual pieces of equipment. After considering the information provided by the commenters, we are persuaded that the supplies that were removed are necessary for the procedure. Therefore, we are including 3 additional minutes in the service period and reinstating the supplies that we removed from the procedure in establishing interim final direct PE inputs.

After considering comments received, we are finalizing the CY 2013 interim final direct PE inputs for CPT code 76872 as established with the additional refinement of adjusting equipment time and incorporating supply items as noted above.

(17) Radiation Oncology: Medical Radiation Physics, Dosimetry, Treatment Devices, and Special Services (CPT Code 77301)

In establishing interim final direct PE inputs for CY 2013, we refined the AMA RUC's recommendation for CPT code 77301 by removing equipment item “computer system, record and verify” from the service, adjusting the equipment time for “treatment planning system, IMRT (Corvus w-Peregrine 3D Monte Carlo)” from 376 to 330, among other refinements previously discussed in the context of our discussion of general refinements.

Comment: Commenters indicated that the minutes used for the computer system are not captured elsewhere and should be included in the service, and that there is physician time independent of clinical staff time for the treatment planning system.

Response: The computer system was not previously an input for this service, and the commenter did not provide sufficient information or evidence for us to conclude that there should be a change. We also note that this service has both a technical and professional component; the professional component has no inputs, and the equipment time associated with the physician time is not appropriately placed in the technical component. Thus, the equipment time is allocated for the technical component only.

After considering public comments, we are finalizing the CY 2013 interim final direct PE inputs for CPT code 77301 as established.

(18) Nuclear Medicine: Diagnostic (CPT Code 78072)

In establishing interim final direct PE inputs for CY 2013, we were unable to price the new equipment item “gamma camera system, single-dual head SPECT/CT” for CPT code 78072 (Parathyroid planar imaging (including subtraction, when performed); with tomographic (SPECT), and concurrently acquired computed tomography (CT) for anatomical localization)) since we did not receive any paid invoices. Because the cost of the item that we were unable to price is disproportionately large relative to the costs reflected by remainder of the recommended direct PE inputs, we contractor priced the technical component of the code for CY 2013, on an interim basis, until the newly recommended equipment item could be appropriately priced.

Comment: A commenter indicated that it would provide necessary documentation so that CMS can establish a price for the new SPECT/CT equipment item associated with CPT code 78072. We received 4 paid invoices for the SPECT/CT equipment.

Response: Out of the four invoices we received, we were only able to use one of them to price the equipment because the other three included training and other costs as part of the overall equipment price. Since training and these other costs are not considered part of the price of the equipment in the current PE methodology, we are unable to use invoices when these items are not separately priced on the invoice. Based on the invoice that met our criteria, this equipment is priced at $600,272. We are assigning 92 minutes based on our standard allocation for highly technical equipment, to include “prepare room, prepare and position patient, administer radiopharmaceutical, acquire images, complete diagnostic forms, and clean room.” After reviewing the comments received, we are establishing interim final direct PE inputs for CPT code 78082 and, rather than contractor price the code as we did in 2013, we are pricing this code under the PFS on an interim final basis for CY 2014.

(19) Pathology and Laboratory: Chemistry (CPT Code 86153)

In establishing interim final direct PE inputs for CY 2013, we refined the AMA RUC's recommendation for CPT code 86153 (Cell enumeration using immunologic selection and identification in fluid specimen (eg, circulating tumor cells in blood)) by valuing the service without direct practice expense inputs.

Comment: Commenters requested that we include direct PE inputs for CPT code 86153, explaining that in the majority of cases, CPT code 86152 is submitted without an accompanying 86153 code. Commenters noted that there are clinical labor tasks furnished by a laboratory technician for this service.

Response: CPT code 86153 is a professional component-only CPT code that is a “clinical laboratory interpretation service,” which is one of the current categories of PFS physician pathology services. For this category of services, only services billed with a “26” modifier may be paid under the PFS; the technical component of these services is paid under the Clinical Lab Fee Schedule (CLFS). Generally, under the PFS, RVUs for services billed with a “26” modifier do not include direct PE inputs, since the development of the RVUs for such codes incorporate all associated direct PE inputs in the RVUs for the technical component of the service. When the corresponding laboratory service is billed under the CLFS, the payment accounts for the resource costs involved in furnishing the laboratory service, including the kinds of costs described by the items in the direct PE input database. In addition, we do not believe that it would serve appropriate relativity to include direct PE inputs for professional component services only when the corresponding technical component payment is made through a different Medicare payment system. After consideration of public comment, we are finalizing our CY 2013 interim final valuation of this service as established.

(20) Pathology and Laboratory: Surgical Pathology (CPT Codes 88300, 88302, 88304, 88305, 88307, 88309)

In establishing interim final direct PE inputs for CY 2013, we refined the AMA RUC's recommendation for CPT codes 88300, 88302, 88304, 88305, 88307, and 88309 (Surgical Pathology, Levels I through VI), by not including new supply items “specimen, solvent, and formalin disposal cost,” and “courier transportation costs” and new equipment items called “equipment maintenance cost,” “Copath System with maintenance contract,” and “Copath software.” We stated in the CY 2013 final rule with comment period that we would consider additional information from commenters regarding whether the Copath computer system and associated software should be considered a direct cost as medical equipment associated with furnishing the technical component of these surgical pathology services. We stated that we were especially interested in understanding the clinical functionality of the equipment in relation to the services being furnished. We also sought additional public comment regarding the appropriate assumptions regarding the direct PE inputs for these services, as well as independent evidence regarding the appropriate number of blocks to assume as typical for each of these services. We requested public comment regarding the appropriate number of blocks and urged the AMA RUC and interested medical specialty societies to provide corroborating, independent evidence that the number of blocks assumed in the current direct PE input recommendations is typical prior to finalizing the direct PE inputs for these services.

Comment: Commenters generally rejected the notion that the items CMS did not accept for this family of codes are indirect costs and asked for a basis for CMS's statement that disposal costs are accounted for in the indirect PE allocation. A commenter asserted that it is extremely rare for CMS to not accept direct PE inputs recommended by the AMA RUC.

Response: As we noted above and in the CY 2014 PFS proposed rule (78 FR 43292), within the PE methodology all costs other than clinical labor, disposable supplies, and medical equipment are considered indirect costs. We note that we frequently refine direct PE recommendations from the AMA RUC and address these refinements through rulemaking. Below, we respond to the specific statements by commenters regarding particular items not accepted as direct inputs.

Comment: Commenters stated that specimen, solvent, and formalin disposal costs are variable costs that can be allocated to individual specimens, and noted that these costs are not captured in surveys of indirect costs used for the PFS. Commenters asserted that these costs are proportional to the number of specimens processed each day, and are directly attributable to each case by specimen size and the number of tissue blocks associated with that specimen. Commenters pointed to several items in the direct PE database that they believed were anomalous to the specimen, solvent, and formalin disposal costs that we did not accept.

Response: In the CY 2014 PFS proposed rule (78 FR 43293), we addressed the items in the direct PE database brought to our attention by the commenters. There, we clarified that we believe that a disposable supply is one that is attributable, in its entirety, to an individual patient for a particular service. We clarified that we believe that supply costs related to specimen disposal attributable to individual services may be appropriately categorized as disposable supplies, but that specimen disposal costs related to an allocated portion of service contracts that cannot be attributed to individual services should not be incorporated into the direct PE input database as disposable supplies. As we address in section II.B. of this final rule, all costs other than clinical labor, disposable supplies, and medical equipment should be considered indirect costs in order to maintain relativity within the PE methodology. We believe that there are a wide range of costs allocable to individual services that are appropriately considered part of indirect cost categories for purposes of the PE methodology.

Comment: Commenters argued that courier transportation costs are directly allocable to individual beneficiary specimens, and represent a significant practice expense. One commenter stated, “Although more than one specimen may be included in a courier run, still there is a cost per specimen” and asserted that the indirect PE costs allocated to CPT code 88305 do not adequately account for the sizeable expense of couriers.

Response: Again, we maintain that all costs other than clinical labor, disposable supplies, and medical equipment should be considered indirect costs to maintain relativity within the PE methodology. In addition to not meeting that criterion to be considered direct PE, the commenter pointed out that more than one specimen may be included in a courier run, so that the cost of courier services does not meet the additional criterion of being “attributable, in its entirety, to an individual patient for a particular service.” We acknowledge the commenters' concern that the indirect costs allocated to CPT code 88305 may not equate to the indirect costs associated for every instance a service described by that code is furnished. However, we note that the practice expense methodology is applied consistently throughout the fee schedule, and that the nature of indirect costs is such that the costs allocated to an individual procedure are an estimate of the relative costs associated with the typical procedure reported with a particular code, and are not intended to account for those costs on a line item basis for each instance the code is reported.

Comment: Commenters argued that the maintenance costs are in fact variable costs in that the costs are proportional to specimen volume. Commenters acknowledged the 5% equipment maintenance factor that is figured into the costs of equipment inputs to the PE methodology, but argued that pathology laboratories have several equipment items that require more frequent maintenance (in the range of 10%-12%). Commenters requested that we establish specialty-specific maintenance factors.

Response: We believe that the nature of many equipment items across the fee schedule is such that the required maintenance would relate, at least in part, to the volume of procedures furnished using the equipment. We note that the established PE methodology does not generally account for either additional costs incurred or efficiencies gained when services are furnished in atypical volumes. The equipment maintenance factor is intended to represent the typical cost per minute associated with a particular piece of equipment. At this time, our PE methodology does not accommodate equipment maintenance factors that vary by specialty.

Comment: Commenters provided descriptions of the CoPath system, indicating that the system provides procedure support that assists labs with specimen management and tracking, report generation, record storage, workflow automation, management reporting and quality assurance functions and support. Commenters stated that the CoPath system is a stand-alone system that must be interfaced with the main electronic health care record system, and is unique to pathology and only used by pathology. The CoPath system is required for labs to assign each specimen its unique identifier and associate it with other specimens from the same patient, as well as track the course of the entire process.

Commenters also explained that the CoPath system is an advanced pathology information management system for storing and reporting pathology information and accommodates clinical disciplines including surgical pathology, cytology, histology, and autopsy. CoPath manages the integrity of specimen accession and processing, and provides patient history review, pathology text entry, support for diagnostic coding using the CAP SNOMED database, report generation, case review and sign out, and retrieval for subsequent purposes. It also assists in inputting blocks and interfaces with cassette and slide labelers, querying database for cases, patient histories, and reducing workload. Commenters compared the Picture Archiving and Communication System (PACS) system for radiologists to the CoPath or equivalent system for pathology.

One commenter argued that the clerical and administrative functionality support by a laboratory information system is immaterial to the direct costs associated with its more prominent utility as the clinical information infrastructure for anatomic pathology laboratories.

Response: We asked for comments to help with our understanding of the clinical functionality of the equipment in relation to the services being furnished. We appreciate the explanations provided, as well as the comparison to the PACS system for radiologists. Based on our review of the comments received, we understand that this information management system is used for a variety of administrative and clerical functions, as well as clinical support functions. Tools that facilitate the similar functionality for other services, such as the cognitive work involved in the professional component, are considered indirect costs under the PFS. For instance, across services furnished by a range of physician specialties, many items that support clinical decision-making are considered indirect costs, irrespective of their utility and are not included in the PE methodology as direct costs. Instead, they are part of the indirect category of resource costs. As a general principle, for this reason, we do not believe that information management systems are appropriately characterized as direct costs.

Furthermore, we believe that the relativity within the PE methodology would be undermined by including these kinds of items as medical equipment only for particular kinds of services. We believe that, were we to reconsider the categorization of clinical information systems for this particular kind of service, it would be necessary to reconsider the categorization of resource costs of other clinical information systems used across PFS services. Therefore, we continue to believe that the CoPath system is best characterized as an indirect cost that is captured in the indirect cost allocation.

Comment: One commenter suggested that the labor cost of the histotechnologist is closer to 50 cents per minute, rather than the 37 cents per minute used in the PE direct inputs database.

Response: We did not change the labor cost for histotechnologists in the CY 2013 final rule with comment period. We note, however, that the prices associated with the labor codes derive from data from the Bureau of Labor Statistics, and we will consider the appropriate time to update all labor category costs in the PE direct inputs database for future rulemaking.

Comment: Commenters disputed the assertion that there is a “typical” case for CPT code 88305, given that there are wide variations in the types of tissues being biopsied.

Response: Under the PFS, services are priced based on the typical case. We continue to seek the best information regarding the inputs involved in furnishing the typical case.

Comment: Commenters expressed concern that CMS asked the AMA RUC to review CPT code 88305 based on the assertion of a single stakeholder that the clinical vignette used to identify the PE inputs was not typical.

Response: As indicated in section II.C.2 of this final rule with comment period, we note that we generally do not identify a code as potentially misvalued solely on the basis of individual assertions. On the contrary, when stakeholders bring information to our attention, it is subject to internal review to determine whether the code would appropriately be proposed as a potentially misvalued code, and we offer the public the opportunity to comment prior to finalizing a code as potentially misvalued. We followed our standard process in evaluating CPT code 88305 as potentially misvalued and reached the conclusion that it was appropriate the refer the service to the AMA RUC. Therefore, we do not agree with commenters that we asked the AMA RUC to review this service based solely on information provided by a single stakeholder.

Comment: Some commenters provided information regarding the number of blocks that is typical for 88305. An association representing pathologists argued that there is no typical case for 88305, and provided several vignettes to illustrate the variation based on the type of tissue being biopsied. The association also presented findings from one data collection effort involving several specialty societies that suggested that the typical number of blocks may be as high as four. However, the association supported the AMA RUC's recommendation of two blocks as most likely to represent the typical case. Other commenters indicated that a review of hundreds of cases from multiple institutions indicated that the typical, or average, case of 88305 requires one block, not two, and that 92% of cases including pathology, skin pathology, surgical pathology, urologic pathology, cell blocks, and bone marrow cases required one block. Another medical specialty indicated that more than two slide-blocks are routinely required, and requested the use of a modifier for 88305 for those services that routinely require more than two slide-blocks. Another commenter requested that we stratify payment based on the number of blocks. Another commenter suggested that the AMA RUC's recommended number of clinical labor minutes for 88305 underestimates the amount of clinical labor time associated with the typical service described by the code.

Response: Based on the wide range of views expressed in comments, it is difficult to determine the appropriate number of blocks to use in establishing direct PE inputs for CPT code 88305. At this time, because we do not have strong evidence to conclude that a change should be made, are maintaining these values. However, we will continue to seek better information to permit consideration of the appropriate number of blocks, and the appropriate direct PE inputs for this code. We are not establishing a modifier to differentiate the number of blocks since there is not a current billing mechanism to make adjustments based on the number of blocks used when a code is reported.

Comment: One commenter argued that the practice expense RVU for CPT code 88305 is insufficient for a tissue exam with two blocks and certainly insufficient for those exams that require more than the two blocks and slides than are accounted for in the AMA RUC's vignette. The commenter argued that even though many tissue biopsies may use an average of two blocks, the valuation of this service does not account for the many kinds of biopsies that use more than two blocks. Another commenter argued that the payment will no longer allow “profits” for 1-2 block specimens to offset the “losses” from specimens that require a larger number of blocks.

Response: We acknowledge the commenter's concern that the valuation of this service is based on two blocks when some services require a greater number of blocks. However, this circumstance is not inconsistent with the established PE methodology, which accounts for the relative resources involved in furnishing a typical case for a particular HCPCS code. We acknowledge that there are cases that use higher than typical resources, and that there are also cases that use lower than typical resources. As a general principle, we do not believe that the direct inputs associated with a particular PFS service should be established or maintained to result in payment rates that might offset outlier cases for that service or support practice expenses for practitioners who furnish lower-paid services.

Furthermore, we note that we continue to receive feedback regarding the appropriate coding and code descriptors for surgical pathology for the prostate needle biopsy services. We believe that revising the code descriptors to ensure that all prostate needle biopsy services with 10 or more specimens are described by the G-codes may facilitate broader consensus regarding the typical resource costs for 88305. Therefore, for clarity, we are revising the CY 2014 descriptors for these HCPCS codes to include the phrase “any method” following “sampling.”

The revised HCPCS code descriptors for microscopic examination for prostate biopsy are as follows: G0416 (Surgical pathology, gross and microscopic examination for prostate needle biopsies, any method; 10-20 specimens), G0417 (Surgical pathology, gross and microscopic examination for prostate needle biopsies, any method; 21-40 specimens), G0418 (Surgical pathology, gross and microscopic examination for prostate needle biopsies, any method; 41-60 specimens) and G0419 (Surgical pathology, gross and microscopic examination for prostate needle biopsies, any method; greater than 60 specimens).

After consideration of public comments received, we are finalizing the CY 2013 interim final direct PE inputs for CPT codes 88300-88309 as established.

(21) Pathology and Laboratory: Cytopathology (CPT Codes 88120 and 88121)

In the PFS final rule with comment period, we addressed comments from stakeholders who suggested that CMS increase the price of the supply “UroVysion test kit” (SA105) by building in an “efficiency factor” to account for the kits that are purchased by practitioners and used in tests that fail. The stakeholders provided documentation suggesting that a certain failure rate is inherent in the procedure.

We indicated that the prices associated with supply inputs in the direct PE input database reflect the price per unit of each supply. Since the current PE methodology relies on the inputs for each service reflecting the typical direct practice expense costs for each service, and the supply costs for the failed tests are not used in furnishing PFS services, we do not believe that the methodology accommodates a failure rate in allocating the cost of disposable medical supplies. Therefore, we did not adjust the price input for “UroVysion test kit” (SA105) in the direct PE input database.

Comment: Commenters disagreed with our decision, stating that these are valid expenses and that the inherent failure rate is commonly due to factors beyond the control of the laboratory or quality of equipment. Further, commenters pointed out that these costs are not reflected in overhead costs, and should therefore be included in direct practice expense inputs.

Response: Because the current PE methodology relies on the inputs used in furnishing each service, reflecting the typical direct practice expense costs for each service, we continue to believe that the price of the supply kit should not reflect any failure rate. After consideration of public comment, we are finalizing the CY 2013 interim final direct PE inputs for CPT codes 88120 and 88121 as established.

(22) Immunotherapy Injections (CPT Codes 95115 and 95117)

In establishing interim final direct PE inputs for CPT codes 95115 and 95117, we refined the AMA RUC's recommendation by removing equipment item “refrigerator, vaccine, commercial grade, w-alarm lock.”

Comment: Commenters indicated that injectable materials need to be refrigerated, and thus the refrigerator should be included for this service.

Response: As previously noted, equipment that is used for multiple procedures at once is considered an indirect cost. In future rulemaking, we anticipate reviewing our files for consistency across practice expense inputs in this regard. After consideration of comments received, we are finalizing the CY 2013 interim final direct practice expense inputs for CPT codes 95115 and 95117 as established.

(23) Neurology and Neuromuscular Procedures: Intraoperative Neurophysiology (CPT Codes 95940, 95941 and HCPCS Code G0453)

In establishing payment for intraoperative neurophysiology (95940 and G0453) for CY 2013, we did not accept the AMA RUC direct PE input recommendations, since we do not believe that these services are furnished to patients outside of facility settings.

Comment: A commenter noted that hospitals previously owned all of the equipment and supplies and employed the technicians for intraoperative monitoring. The commenter asserted that, currently, hospitals often use “mobile services” to furnish these monitoring procedures, and thus there should be technical component RVUs for these services.

Response: The structure of monitoring businesses and the arrangements made with hospitals are not a factor in determining the inputs typical to a particular service. Since this service is furnished in a facility, we have not included direct PE inputs for this service. We continue to believe that this service should be priced without direct PE inputs because when a service is furnished in the facility setting, the equipment, supplies, and labor costs of the service are considered in the calculation of Medicare payments made to the facility through other Medicare payment systems. After consideration of comments received, we are finalizing the CY 2013 interim final direct PE inputs for 95940 and G0453 as established.

(24) Neurology and Neuromuscular Procedures: Sleep Medicine Testing (CPT Codes 95782, 95783)

In establishing interim final direct PE inputs for CY 2013, we refined the AMA RUC's recommendation for CPT codes 95782 (Polysomnography, younger than 6 years, 4 or more) and 95783 (Polysomnography, younger than 6 years, w/cpap) by reducing time associated with “Measure and mark head and face. Apply and secure electrodes to head and face. Check impedances. Reapply electrodes as needed” and “apply recording devices” and removing equipment item “crib” for use in these services. We stated that we did not believe a crib would typically be used in this service, and we incorporated the bedroom furniture including a hospital bed and a reclining chair as typical equipment for this service.

Comment: Commenters disagreed, stating that it takes additional time to perform these clinical labor tasks for a child, and that we should assign 30 minutes to the “measure and mark head and face” task and 25 minutes to the “apply recording devices” task. Commenters also indicated that the crib is used in the typical case, while the parent uses the hospital bed to remain close to the child. We also received a paid invoice for the equipment item “crib.”

Response: After additional clinical review, we agree with commenters' explanation that the additional clinical labor minutes are required when furnishing these services to children. Therefore, we are allocating an additional 5 minutes for each of these tasks, so that 25 minutes are allocated based on the clinical labor task called “Measure and mark head and face. Apply and secure electrodes to head and face. Check impedances. Reapply electrodes as needed” and 20 minutes are allocated for the task “apply recording devices.” Based on the information provided by commenters, we agree that the equipment item “crib” should be included for CPT codes 95782 and 95783. We are pricing the equipment item “crib” at $3,900 based on the invoice received. After consideration of the comments received, we are finalizing the CY 2013 interim final direct PE inputs for 95782 and 95783 as established with the additional refinement of adjusting the clinical labor time and incorporating the “crib” discussed above.

(25) Neurology and Neuromuscular Procedures: Electromyography and Nerve Conduction Tests (CPT Codes 95907, 95908, 95909, 95910, 95911, 95912, 95913, and 95861)

In establishing interim final direct PE inputs for CY 2013, we refined the AMA RUC's recommendation for CPT code 95861 by adjusting the time for the clinical labor activity “assist physician in performing procedure” from 19 minutes to 29 minutes to conform to physician time.

Comment: Commenters brought to our attention that this refinement was inaccurate, in that the AMA RUC recommendation included 29 minutes for this labor activity.

Response: We agree with commenters that this refinement was inaccurate and acknowledge the administrative discrepancy in the refinement table. We note that this had no impact on payment rates, since there was no corresponding discrepancy in the direct PE input database. After considering comments received, we are finalizing the CY 2013 interim final direct PE inputs for CPT code 95861 as established.

We also refined the AMA RUC's recommendation for CPT codes 95907, 95908, 95909, 95910, 95911, 95912, and 95913 by substituting non-sterile gauze for sterile gauze, and removing surgical tape and electrode gel.

Comment: Commenters indicated that sterile gauze is required because the skin is cleansed before the procedure with vigorous scrubbing that often can produce minor bleeding, and that tape is required because the electrodes may not stick well when testing patients who have used lotions or creams prior to testing. Finally, the electrode gel is required to maximize conductivity, especially in patients who have used lotions or creams prior to testing.

Response: We agree with commenters that the sterile gauze and tape should be included for this service. However, since the disposable electrode pack includes pre-gelled electrodes, we do not believe it is typical that electrode gel is also used in this procedure. After consideration of public comments, we are finalizing the CY 2013 interim final direct practice expense inputs for CPT codes 95907—95913 as established, with the additional refinement of including the sterile gauze and tape.

(26) Neurology and Neuromuscular Procedures: Autonomic Function Testing (CPT Codes 95921, 95922, 95923, and 95924)

In establishing interim final direct PE inputs for CY 2013, we refined the AMA RUC's recommendation for CPT codes 95921 and 95922 by removing the preservice clinical labor tasks, and adjusting the monitoring time following the procedure from 5 to 2 minutes for 95921, 95922, 95923, and 95924.

Comment: Commenters stated that the patient requires assistance following the tests; therefore, additional time for monitoring the patient is necessary and should be added to the number of clinical labor minutes in the service period.

Response: CMS clinical staff reviewed the information presented by commenters and found no evidence that 2 minutes did not represent the typical resources involved in furnishing the service for CPT codes 95921, 95922, 95923, and 95924.

In refining CPT codes 95921, 95922, 95923, and 95924, we refined the equipment time to reflect the typical use exclusive to the patient.

Comment: Commenters stated that extra time was required for the equipment so that the patient can lie still after the procedure to ensure that there are not negative side effects due to fluctuations in blood pressure.

Response: We agree with commenters' justification for allocating additional equipment minutes to account for the time that the patient is laying still after the procedure.

In refining CPT code 95923, we refined the clinical labor activity “assist physician” to 45 minutes.

Comment: Commenters stated that an additional 10 minutes of “assist physician” time was needed to assist the patient out of the machine and into the shower, since patients are extremely sweaty after the procedure.

Response: Assisting patients following the procedure is not part of the “assist physician” labor activity. Since this clinical labor activity was not specified in the AMA RUC recommendation, we do not believe this activity typically takes additional time over that already allotted to the procedure. After considering public comments received, we are finalizing the CY 2013 interim final direct practice expense inputs for CPT codes 95921—95924 as established.

(27) Special Dermatological Procedures (CPT Codes 96920, 96921, 96922)

In establishing interim final direct PE inputs for CY 2013, we refined the AMA RUC's recommendation for CPT codes 96920, 96921, and 96922 by decreasing the time allocated to clinical labor activity “monitor patient following service/check tubes, monitors, drains” from 3 minutes to 1 minutes, and clinical labor activity “clean room/equipment by physician staff” from 3 minutes to 2 minutes.

Comment: Commenters objected to CMS's refinement of clinical labor tasks below the standard number of minutes allocated for these tasks.

Response: We agree with commenters that the standard number of AMA RUC-recommended minutes should be allocated for these tasks. After considering public comments received, we are finalizing the CY 2013 interim final direct practice expense inputs for CPT codes 96920, 96921, and 96922 with the additional refinement of adjusting the times allocated for the clinical labor activities noted above.

(28) Psychiatry (CPT Codes 90791, 90832, 90834, and 90837)

As we addressed in the CY 2013 PFS final rule (77 FR 69075), the AMA RUC submitted direct PE input recommendations in the revised set of codes that describe psychotherapy services. These recommendations included significant reductions to the direct PE inputs associated with the predecessor codes. For most of the new codes, we accepted these recommended reductions in direct practice expense. This was consistent with our general approach of maintaining the existing values for these services given that many practitioners who furnished these services prior to CY 2013 would report concurrent medical evaluation and management services (which have practice expense values that will offset the differences in total PE values between the new and old psychotherapy codes). However, for practitioners who do not furnish medical E/M services, there were no corresponding PE value increases to offset the recommended reductions. Therefore, instead of accepting the recommended direct PE inputs for the new CPT codes that describe services primarily furnished by practitioners who do not also report medical E/M services, for CY 2013, we crosswalked the 2012 PE RVUs from the predecessor codes. This crosswalk used the CY 2012 year fully-implemented PE RVUs established for CPT codes 90791 (Psychiatric diagnostic evaluation), 90832 (Psychotherapy, 30 minutes with patient and/or family member), 90834 (Psychotherapy, 45 minutes with patient and/or family member), and 90837 (Psychotherapy, 60 minutes with patient and/or family member).

Comment: Several commenters pointed out that by crosswalking the PE RVUs from predecessor codes, CMS created a rank order anomaly for CPT codes 90791 (Psychiatric diagnostic evaluation) and 90792 (Psychiatric diagnostic evaluation with medical services). These commenters urged CMS to issue a technical correction for CY 2013 and accept the AMA-RUC recommended inputs in developing PE RVUs for these services for CY 2014.

Response: We appreciate the commenters' concerns regarding rank order anomalies for these services. However, as we explained in establishing the interim final values for CY 2013, we believed that it was important to maintain approximate overall value for the family of services for the specialties involved, pending valuation of the whole set of codes for CY 2014. Now that we have considered the full family of codes for CY 2014 including the additional work RVUs, we agree with the commenters and believe that the AMA RUC- recommended direct PE inputs for the whole family of codes can be implemented. Given the significant change in PE RVUs and in the context of the whole family of services, the direct PE inputs for these services will be interim final and subject to comment for CY 2014.

Comment: In a comment to the CY 2014 proposed PFS rule, one commenter argued that the crosswalked PE RVUs for these services should be maintained due to the negative impact of the PE methodology on certain specialties, especially clinical psychologists. This commenter also suggested that the reductions in PE RVUs that would result from implementing the AMA RUC recommended direct PE inputs for CY 2014 would fully offset any increases in work RVUs for these services.

Response: We do not agree that the reductions in PE RVUs that result from the AMA RUC-recommended inputs fully offset the increases in overall payment for these services that results from CMS' adoption of the AMA RUC-recommended work RVUs for most of the codes in this family. However, we will consider the commenter's concerns regarding the effect of the PE methodology for specialties like clinical psychologists for future rulemaking.

(29) Transitional Care Management Services (CPT Codes 99495, 99496)

In establishing interim final direct PE inputs for CY 2013, we refined the AMA RUC recommendation by incorporating the clinical labor inputs for dedicated non-face-to-face care management tasks as facility inputs in addition to increasing clinical labor minutes for 99496.

Comment: The AMA RUC disagreed with CMS's refinement to include clinical labor minutes in the facility setting based on the assertion that the non-face-to-face care management tasks are critical to the codes and cannot be separated from the care coordination delivered by the clinical staff in the non-facility setting. The AMA RUC also suggested that several medical specialty societies also disagreed with the refinement to include clinical labor minutes in the facility setting, while one specialty society agreed with our refinement.

Response: After considering the rationale of the AMA RUC, we agree that only non-facility direct PE inputs should be included for these services. Therefore, we are finalizing the CY 2013 interim final direct PE inputs for 99495 and 99496 as established with the additional refinement of removing the facility direct PE inputs.

c. Finalizing CY 2013 Interim and Proposed Malpractice Crosswalks for CY 2014

In accordance with our malpractice methodology, we adjusted the malpractice RVUs for the CY 2013 new/revised codes for the difference in work RVUs (or, if greater, the clinical labor portion of the PE RVUs) between the source codes and the new/revised codes to reflect the specific risk-of-service for the new/revised codes. The interim final malpractice crosswalks were listed in Table 75 of the CY 2013 PFS final rule with comment period.

We received no comments on the CY 2013 interim final malpractice crosswalks and are finalizing them without modification for CY 2014. The malpractices RVUs for these services are reflected in Addendum B of this CY 2014 PFS final rule with comment period.

Consistent with past practice when the MEI has been rebased or revised we proposed to make adjustments to ensure that estimates of the aggregate CY 2014 PFS payments for work, PE and malpractice are in proportion to the weights for these categories in the revised MEI. As discussed in the II.A., the MEI is being revised for CY 2014, the PE and malpractice RVUs, and the CF are being adjusted accordingly. For more information on this, see section II.B. We received no comments specifically on the adjustment to malpractice RVUs.

d. Other New, Revised or Potentially Misvalued Codes With CY 2013 Interim Final RVUs Not Specifically Discussed in the CY 2014 Final Rule With Comment Period

For all other new, revised, or potentially misvalued codes with CY 2013 interim final RVUs that are not specifically discussed in this CY 2014 PFS final rule with comment period, we are finalizing for CY 2014, without modification, the CY 2013 interim final or CY 2014 proposed work RVUs, malpractice crosswalks, and direct PE inputs. Unless otherwise indicated, we agreed with the time values recommended by the AMA RUC or HCPAC for all codes addressed in this section. The time values for all codes are listed in a file called “CY 2014 PFS Physician Time,” available on the CMS Web site under downloads for the CY 2014 PFS final rule with comment period at http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PhysicianFeeSched/PFS-Federal-Regulation-Notices.html.

3. Establishing CY 2014 Interim Final RVUs

a. Establishing CY 2014 Interim Final Work RVUs

Table 27 contains the CY 2014 interim final work RVUs for all codes for which we received AMA RUC recommendations for CY 2014 and new G-codes created for CY 2014. These values are subject to public comment in this final rule with comment period. Codes for which work RVUs are not applicable have the appropriate PFS procedure status indicator in the relevant column. A description of all PFS procedure status indicators can be found in Addendum A. The column labeled “CMS Time Refinement” indicates for each code whether we refined the time values recommended by the AMA RUC or HCPAC.

The RVUs and other payment information for all CY 2014 payable codes are available in Addendum B. The RVUs and other payment information regarding all codes subject to public comment in this final rule with comment period are available in Addendum C. All addenda are available on the CMS Web site under downloads for the CY 2014 PFS final rule with comment period at http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PhysicianFeeSched/PFS-Federal-Regulation-Notices.html. The time values for all CY 2014 codes are listed in a file called “CY 2014 PFS Physician Time,” available on the CMS Web site under downloads for the CY 2014 PFS final rule with comment period at http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PhysicianFeeSched/PFS-Federal-Regulation-Notices.html.

Table 27—Interim Final Work RVUs for New/Revised/Potentially Misvalued Codes Back to Top
HCPCS code Long descriptor CY 2013 work RVU AMA RUC/HCPAC recommended work RVU CY 2014 work RVU CMS time refinement
10030 Image-guided fluid collection drainage by catheter (eg, abscess, hematoma, seroma, lymphocele, cyst), soft tissue (eg, extremity, abdominal wall, neck), percutaneous New 3.00 3.00 No.
17000 Destruction (eg, laser surgery, electrosurgery, cryosurgery, chemosurgery, surgical curettement), premalignant lesions (eg, actinic keratoses); first lesion 0.65 0.61 0.61 No.
17003 Destruction (eg, laser surgery, electrosurgery, cryosurgery, chemosurgery, surgical curettement), premalignant lesions (eg, actinic keratoses); second through 14 lesions, each (list separately in addition to code for first lesion) 0.07 0.04 0.04 No.
17004 Destruction (eg, laser surgery, electrosurgery, cryosurgery, chemosurgery, surgical curettement), premalignant lesions (eg, actinic keratoses), 15 or more lesions 1.85 1.37 1.37 No.
17311 Mohs micrographic technique, including removal of all gross tumor, surgical excision of tissue specimens, mapping, color coding of specimens, microscopic examination of specimens by the surgeon, and histopathologic preparation including routine stain(s) (eg, hematoxylin and eosin, toluidine blue), head, neck, hands, feet, genitalia, or any location with surgery directly involving muscle, cartilage, bone, tendon, major nerves, or vessels; first stage, up to 5 tissue blocks 6.20 6.20 6.20 No.
17312 Mohs micrographic technique, including removal of all gross tumor, surgical excision of tissue specimens, mapping, color coding of specimens, microscopic examination of specimens by the surgeon, and histopathologic preparation including routine stain(s) (eg, hematoxylin and eosin, toluidine blue), head, neck, hands, feet, genitalia, or any location with surgery directly involving muscle, cartilage, bone, tendon, major nerves, or vessels; each additional stage after the first stage, up to 5 tissue blocks (list separately in addition to code for primary procedure) 3.30 3.30 3.30 No.
17313 Mohs micrographic technique, including removal of all gross tumor, surgical excision of tissue specimens, mapping, color coding of specimens, microscopic examination of specimens by the surgeon, and histopathologic preparation including routine stain(s) (eg, hematoxylin and eosin, toluidine blue), of the trunk, arms, or legs; first stage, up to 5 tissue blocks 5.56 5.56 5.56 No.
17314 Mohs micrographic technique, including removal of all gross tumor, surgical excision of tissue specimens, mapping, color coding of specimens, microscopic examination of specimens by the surgeon, and histopathologic preparation including routine stain(s) (eg, hematoxylin and eosin, toluidine blue), of the trunk, arms, or legs; each additional stage after the first stage, up to 5 tissue blocks (list separately in addition to code for primary procedure) 3.06 3.06 3.06 No.
17315 Mohs micrographic technique, including removal of all gross tumor, surgical excision of tissue specimens, mapping, color coding of specimens, microscopic examination of specimens by the surgeon, and histopathologic preparation including routine stain(s) (eg, hematoxylin and eosin, toluidine blue), each additional block after the first 5 tissue blocks, any stage (list separately in addition to code for primary procedure) 0.87 0.87 0.87 No.
19081 Biopsy, breast, with placement of breast localization device(s) (eg, clip, metallic pellet), when performed, and imaging of the biopsy specimen, when performed, percutaneous; first lesion, including stereotactic guidance New 3.29 3.29 No.
19082 Biopsy, breast, with placement of breast localization device(s) (eg, clip, metallic pellet), when performed, and imaging of the biopsy specimen, when performed, percutaneous; each additional lesion, including stereotactic guidance (list separately in addition to code for primary procedure) New 1.65 1.65 No.
19083 Biopsy, breast, with placement of breast localization device(s) (eg, clip, metallic pellet), when performed, and imaging of the biopsy specimen, when performed, percutaneous; first lesion, including ultrasound guidance New 3.10 3.10 No.
19084 Biopsy, breast, with placement of breast localization device(s) (eg, clip, metallic pellet), when performed, and imaging of the biopsy specimen, when performed, percutaneous; each additional lesion, including ultrasound guidance (list separately in addition to code for primary procedure) New 1.55 1.55 No.
19085 Biopsy, breast, with placement of breast localization device(s) (eg, clip, metallic pellet), when performed, and imaging of the biopsy specimen, when performed, percutaneous; first lesion, including magnetic resonance guidance New 3.64 3.64 No.
19086 Biopsy, breast, with placement of breast localization device(s) (eg, clip, metallic pellet), when performed, and imaging of the biopsy specimen, when performed, percutaneous; each additional lesion, including magnetic resonance guidance (list separately in addition to code for primary procedure) New 1.82 1.82 No.
19281 Placement of breast localization device(s) (eg, clip, metallic pellet, wire/needle, radioactive seeds), percutaneous; first lesion, including mammographic guidance New 2.00 2.00 No.
19282 Placement of breast localization device(s) (eg, clip, metallic pellet, wire/needle, radioactive seeds), percutaneous; each additional lesion, including mammographic guidance (list separately in addition to code for primary procedure) New 1.00 1.00 No.
19283 Placement of breast localization device(s) (eg, clip, metallic pellet, wire/needle, radioactive seeds), percutaneous; first lesion, including stereotactic guidance New 2.00 2.00 No.
19284 Placement of breast localization device(s) (eg, clip, metallic pellet, wire/needle, radioactive seeds), percutaneous; each additional lesion, including stereotactic guidance (list separately in addition to code for primary procedure) New 1.00 1.00 No.
19285 Placement of breast localization device(s) (eg, clip, metallic pellet, wire/needle, radioactive seeds), percutaneous; first lesion, including ultrasound guidance New 1.70 1.70 No.
19286 Placement of breast localization device(s) (eg, clip, metallic pellet, wire/needle, radioactive seeds), percutaneous; each additional lesion, including ultrasound guidance (list separately in addition to code for primary procedure) New 0.85 0.85 Yes.
19287 Placement of breast localization device(s) (eg clip, metallic pellet, wire/needle, radioactive seeds), percutaneous; first lesion, including magnetic resonance guidance New 3.02 2.55 No.
19288 Placement of breast localization device(s) (eg clip, metallic pellet, wire/needle, radioactive seeds), percutaneous; each additional lesion, including magnetic resonance guidance (list separately in addition to code for primary procedure) New 1.51 1.28 No.
23333 Removal of foreign body, shoulder; deep (subfascial or intramuscular) New 6.00 6.00 No.
23334 Removal of prosthesis, includes debridement and synovectomy when performed; humeral or glenoid component New 18.89 15.50 No.
23335 Removal of prosthesis, includes debridement and synovectomy when performed; humeral and glenoid components (eg, total shoulder) New 22.13 19.00 No.
24164 Removal of prosthesis, includes debridement and synovectomy when performed; radial head 6.43 10.00 10.00 No.
27130 Arthroplasty, acetabular and proximal femoral prosthetic replacement (total hip arthroplasty), with or without autograft or allograft 21.79 19.60 20.72 Yes.
27236 Open treatment of femoral fracture, proximal end, neck, internal fixation or prosthetic replacement 17.61 17.61 17.61 Yes.
27446 Arthroplasty, knee, condyle and plateau; medial or lateral compartment 16.38 17.48 17.48 No.
27447 Arthroplasty, knee, condyle and plateau; medial and lateral compartments with or without patella resurfacing (total knee arthroplasty) 23.25 19.60 20.72 Yes.
31237 Nasal/sinus endoscopy, surgical; with biopsy, polypectomy or debridement (separate procedure) 2.98 2.60 2.60 No.
31238 Nasal/sinus endoscopy, surgical; with control of nasal hemorrhage 3.26 2.74 2.74 No.
31239 Nasal/sinus endoscopy, surgical; with dacryocystorhinostomy 9.33 9.04 9.04 No.
31240 Nasal/sinus endoscopy, surgical; with concha bullosa resection 2.61 2.61 2.61 No.
33282 Implantation of patient-activated cardiac event recorder 4.80 3.50 3.50 No.
33284 Removal of an implantable, patient-activated cardiac event recorder 3.14 3.00 3.00 No.
33366 Transcatheter aortic valve replacement (tavr/tavi) with prosthetic valve; transapical exposure (eg, left thoracotomy) New 40.00 35.88 No.
34841 Endovascular repair of visceral aorta (eg, aneurysm, pseudoaneurysm, dissection, penetrating ulcer, intramural hematoma, or traumatic disruption) by deployment of a fenestrated visceral aortic endograft and all associated radiological supervision and interpretation, including target zone angioplasty, when performed; including one visceral artery endoprosthesis (superior mesenteric, celiac or renal artery) New C C N/A.
34842 Endovascular repair of visceral aorta (eg, aneurysm, pseudoaneurysm, dissection, penetrating ulcer, intramural hematoma, or traumatic disruption) by deployment of a fenestrated visceral aortic endograft and all associated radiological supervision and interpretation, including target zone angioplasty, when performed; including two visceral artery endoprostheses (superior mesenteric, celiac and/or renal artery[s]) New C C N/A.
34843 Endovascular repair of visceral aorta (eg, aneurysm, pseudoaneurysm, dissection, penetrating ulcer, intramural hematoma, or traumatic disruption) by deployment of a fenestrated visceral aortic endograft and all associated radiological supervision and interpretation, including target zone angioplasty, when performed; including three visceral artery endoprostheses (superior mesenteric, celiac and/or renal artery[s]) New C C N/A.
34844 Endovascular repair of visceral aorta (eg, aneurysm, pseudoaneurysm, dissection, penetrating ulcer, intramural hematoma, or traumatic disruption) by deployment of a fenestrated visceral aortic endograft and all associated radiological supervision and interpretation, including target zone angioplasty, when performed; including four or more visceral artery endoprostheses (superior mesenteric, celiac and/or renal artery[s]) New C C N/A.
34845 Endovascular repair of visceral aorta and infrarenal abdominal aorta (eg, aneurysm, pseudoaneurysm, dissection, penetrating ulcer, intramural hematoma, or traumatic disruption) with a fenestrated visceral aortic endograft and concomitant unibody or modular infrarenal aortic endograft and all associated radiological supervision and interpretation, including target zone angioplasty, when performed; including one visceral artery endoprosthesis (superior mesenteric, celiac or renal artery) New C C N/A.
34846 Endovascular repair of visceral aorta and infrarenal abdominal aorta (eg, aneurysm, pseudoaneurysm, dissection, penetrating ulcer, intramural hematoma, or traumatic disruption) with a fenestrated visceral aortic endograft and concomitant unibody or modular infrarenal aortic endograft and all associated radiological supervision and interpretation, including target zone angioplasty, when performed; including two visceral artery endoprostheses (superior mesenteric, celiac and/or renal artery[s]) New C C N/A.
34847 Endovascular repair of visceral aorta and infrarenal abdominal aorta (eg, aneurysm, pseudoaneurysm, dissection, penetrating ulcer, intramural hematoma, or traumatic disruption) with a fenestrated visceral aortic endograft and concomitant unibody or modular infrarenal aortic endograft and all associated radiological supervision and interpretation, including target zone angioplasty, when performed; including three visceral artery endoprostheses (superior mesenteric, celiac and/or renal artery[s]) New C C N/A.
34848 Endovascular repair of visceral aorta and infrarenal abdominal aorta (eg, aneurysm, pseudoaneurysm, dissection, penetrating ulcer, intramural hematoma, or traumatic disruption) with a fenestrated visceral aortic endograft and concomitant unibody or modular infrarenal aortic endograft and all associated radiological supervision and interpretation, including target zone angioplasty, when performed; including four or more visceral artery endoprostheses (superior mesenteric, celiac and/or renal artery[s]) New C C N/A.
35301 Thromboendarterectomy, including patch graft, if performed; carotid, vertebral, subclavian, by neck incision 19.61 21.16 21.16 No.
36245 Selective catheter placement, arterial system; each first order abdominal, pelvic, or lower extremity artery branch, within a vascular family 4.67 4.90 4.90 No.
37217 Transcatheter placement of an intravascular stent(s), intrathoracic common carotid artery or innominate artery by retrograde treatment, via open ipsilateral cervical carotid artery exposure, including angioplasty, when performed, and radiological supervision and interpretation New 22.00 20.38 No.
37236 Transcatheter placement of an intravascular stent(s) (except lower extremity, cervical carotid, extracranial vertebral or intrathoracic carotid, intracranial, or coronary), open or percutaneous, including radiological supervision and interpretation and including all angioplasty within the same vessel, when performed; initial artery New 9.00 9.00 No.
37237 Transcatheter placement of an intravascular stent(s) (except lower extremity, cervical carotid, extracranial vertebral or intrathoracic carotid, intracranial, or coronary), open or percutaneous, including radiological supervision and interpretation and including all angioplasty within the same vessel, when performed; each additional artery (list separately in addition to code for primary procedure) New 4.25 4.25 No.
37238 Transcatheter placement of an intravascular stent(s), open or percutaneous, including radiological supervision and interpretation and including angioplasty within the same vessel, when performed; initial vein New 6.29 6.29 No.
37239 Transcatheter placement of an intravascular stent(s), open or percutaneous, including radiological supervision and int