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Medicare Program; Revisions to Payment Policies Under the Physician Fee Schedule and Other Revisions to Part B for CY 2016

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AGENCY:

Centers for Medicare & Medicaid Services (CMS), HHS.

ACTION:

Final rule with comment period.

SUMMARY:

This major final rule with comment period addresses changes to the physician 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, as well as changes in the statute.

DATES:

Effective date: The provisions of this final rule with comment period are effective on January 1, 2016, except the definition of “ownership or investment interest” in § 411.362(a), which has an effective date of January 1, 2017.

Comment date: To be assured consideration, comments must be received at one of the addresses provided below, no later than 5 p.m. on December 29, 2015. (See the SUPPLEMENTARY INFORMATION section of this final rule with comment period for a list of provisions open for comment.)

ADDRESSES:

In commenting, please refer to file code CMS-1631-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-1631-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-1631-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.

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FOR FURTHER INFORMATION CONTACT:

Donta Henson, (410) 786-1947 for issues related to pathology and ophthalmology services or any physician payment issues not identified below.

Abdihakin Abdi, (410) 786-4735, for issues related to portable X-ray transportation fees.

Gail Addis, (410) 786-4522, for issues related to the refinement panel.

Lindsey Baldwin, (410) 786-1694, for issues related to valuation of moderate sedation and colonoscopy services.

Jessica Bruton, (410) 786-5991, for issues related to potentially misvalued code lists.

Roberta Epps, (410) 786-4503, for issues related to PAMA section 218(a) policy.

Ken Marsalek, (410) 786-4502, for issues related to telehealth services.

Ann Marshall, (410) 786-3059, for issues related to advance care planning, and for primary care and care management services.

Geri Mondowney, (410) 786-4584, for issues related to geographic practice cost indices, malpractice RVUs, target, and phase-in provisions.

Chava Sheffield, (410) 786-2298, for issues related to the practice expense methodology, impacts, and conversion factor.

Michael Soracoe, (410) 786-6312, for issues related to the practice expense methodology and the valuation and coding of the global surgical packages.

Regina Walker-Wren, (410) 786-9160, for issues related to the “incident to” proposals.

Pamela West, (410) 786-2302, for issues related to therapy caps.

Emily Yoder, (410) 786-1804, for issues related to valuation of radiation treatment services.

Amy Gruber, (410) 786-1542, for issues related to ambulance payment policy.

Corinne Axelrod, (410) 786-5620, for issues related to rural health clinics or federally qualified health centers and payment to grandfathered tribal FQHCs.

Simone Dennis, (410) 786-8409, for issues related to rural health clinics HCPCS reporting.

Edmund Kasaitis (410) 786-0477, for issues related to Part B drugs, biologicals, and biosimilars.

Alesia Hovatter, (410) 786-6861, for issues related to Physician Compare.

Deborah Krauss, (410) 786-5264 and Alexandra Mugge, (410) 786-4457, for issues related to the physician quality reporting system and the merit-based incentive payment system.

Alexandra Mugge, (410) 786-4457, for issues related to EHR Incentive Program.

Sarah Arceo, (410) 786-2356 or Patrice Holtz, (410786-5663 for issues related to EHR Incentive Program-Comprehensive Primary Care (CPC) initiative and Medicare EHR Incentive Program aligned reporting.

Rabia Khan or Terri Postma, (410) 786-8084 or ACO@cms.hhs.gov, for issues related to Medicare Shared Savings Program.

Kimberly Spalding Bush, (410) 786-3232, or Sabrina Ahmed (410) 786-7499, for issues related to value-based Payment Modifier and Physician Feedback Program.

Frederick Grabau, (410) 786-0206, for issues related to changes to opt-out regulations.

Lisa Ohrin Wilson (410) 786-8852, or Matthew Edgar (410) 786-0698, for issues related to physician self-referral updates.

Christiane LaBonte, (410) 786-7234, for issues related to Comprehensive Primary Care (CPC) initiative.

JoAnna Baldwin (410) 786-7205, or Sarah Fulton (410) 786-2749, for issues Start Printed Page 70887related to appropriate use criteria for advanced diagnostic imaging services.

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SUPPLEMENTARY INFORMATION:

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.

Provisions open for comment: We will consider comments that are submitted as indicated above in the DATES and ADDRESSES sections on the following subject areas discussed in this final rule with comment period: Interim final work, practice expense (PE), and malpractice (MP) RVUs (including applicable work time, direct PE inputs, and MP crosswalks) for CY 2016; interim final new, revised, potentially misvalued HCPCS codes as indicated in the Preamble text and listed in Addendum C to this final rule with comment period; and the additions and deletions to the physician self-referral list of HCPCS/CPT codes found on tables 50 and 51.

Table of Contents

I. Executive Summary and Background

A. Executive Summary

B. Background

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

A. Determination of Practice Expense (PE) Relative Value Units (RVUs)

B. Determination of Malpractice Relative Value Units (RVUs)

1. Overview

2. Proposed Annual Update of MP RVUs

3. MP RVU Update for Anesthesia Services

4. MP RVU Methodology Refinements

5. CY 2016 Identification of Potentially Misvalued Services for Review

6. Valuing Services That Include Moderate Sedation as an Inherent Part of Furnishing the Procedure

7. Improving the Valuation and Coding of the Global Package

C. Elimination of the Refinement Panel

D. Improving Payment Accuracy for Primary Care and Care Management Services

E. Target for Relative Value Adjustments for Misvalued Services

F. Phase-In of Significant RVU Reductions

G. Changes for Computed Tomography (CT) Under the Protecting Access to Medicare Act of 2014 (PAMA)

H. Valuation of Specific Codes

1. Background

2. Process for Valuing New, Revised, and Potentially Misvalued Codes

3. Methodology for Establishing Work RVUs

4. Methodology for Establishing the Direct PE Inputs Used To Develop PE RVUs

5. Methodology for Establishing Malpractice RVUs

6. CY 2016 Valuation of Specific Codes

a. Lower GI Endoscopy Services

b. Radiation Treatment and Related Image Guidance Services

c. Advance Care Planning Services

d. Valuation of Other Codes for CY 2016

7. Direct PE Input-Only Recommendations

8. CY 2015 Interim Final Codes

9. CY 2016 Interim Final Codes

I. Medicare Telehealth Services

J. Incident to Proposals: Billing Physician as the Supervising Physician and Ancillary Personnel Requirements

K. Portable X-Ray: Billing of the Transportation Fee

L. Technical Correction: Waiver of Deductible for Anesthesia Services Furnished on the Same Date as a Planned Screening Colorectal Cancer Test

M. Therapy Caps

III. Other Provisions of the Final Rule With Comment Period

A. Provisions Associated With the Ambulance Fee Schedule

B. Chronic Care Management (CCM) Services for Rural Health Clinics (RHCs) and Federally Qualified Health Centers (FQHCs)

C. Healthcare Common Procedure Coding System (HCPCS) Coding for Rural Health Clinics (RHCs)

D. Payment to Grandfathered Tribal FQHCs That Were Provider-Based Clinics on or Before April 7, 2000

E. Part B Drugs—Biosimilars

F. Productivity Adjustment for the Ambulance, Clinical Laboratory, and DMEPOS Fee Schedules

G. Appropriate Use Criteria for Advanced Diagnostic Imaging Services

H. Physician Compare Web site

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

J. Electronic Clinical Quality Measures (eCQM) and Certification Criteria and Electronic Health Record (EHR) Incentive Program— Comprehensive Primary Care (CPC) Initiative and Medicare Meaningful Use Aligned Reporting

K. Discussion and Acknowledgement of Public Comments Received on the Potential Expansion of the Comprehensive Primary Care (CPC) Initiative

L. Medicare Shared Savings Program

M. Value-Based Payment Modifier and Physician Feedback Program

N. Physician Self-Referral Updates

O. Private Contracting/Opt-Out

P. 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 in Effective Date

VII. Regulatory Impact Analysis

Acronyms

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:

AAA Abdominal aortic aneurysms

ACO Accountable care organization

AMA American Medical Association

ASC Ambulatory surgical center

ATA American Telehealth Association

ATRA American Taxpayer Relief Act (Pub. L. 112-240)

AWV Annual wellness visit

BBA Balanced 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)

CAD Coronary artery disease

CAH Critical access hospital

CBSA Core-Based Statistical Area

CCM Chronic care management

CEHRT Certified EHR technology

CF Conversion factor

CG-CAHPS Clinician and Group Consumer Assessment of Healthcare Providers and Systems

CLFS Clinical Laboratory Fee Schedule

CNM Certified nurse-midwife

CP Clinical psychologist

CPC Comprehensive Primary Care

CPEP Clinical Practice Expert Panel

CPT [Physicians] Current Procedural Terminology (CPT codes, descriptions and other data only are copyright 2014 American Medical Association. All rights reserved.)

CQM Clinical quality measure

CSW Clinical social worker

CT Computed tomography

CY Calendar year

DFAR Defense Federal Acquisition Regulations

DHS Designated health services

DM Diabetes mellitus

DSMT Diabetes self-management training

eCQM Electronic clinical quality measures

EHR Electronic health record

E/M Evaluation and management

EP Eligible professional

eRx Electronic prescribing

ESRD End-stage renal disease

FAR Federal Acquisition Regulations

FFS Fee-for-service

FQHC Federally qualified health center

FR Federal Register

GAF Geographic adjustment factor

GAO Government Accountability OfficeStart Printed Page 70888

GPCI Geographic practice cost index

GPO Group purchasing organization

GPRO Group practice reporting option

GTR Genetic Testing Registry

HCPCS Healthcare Common Procedure Coding System

HHS [Department of] Health and Human Services

HOPD Hospital outpatient department

HPSA Health professional shortage area

IDTF Independent diagnostic testing facility

IPPE Initial preventive physical exam

IPPS Inpatient Prospective Payment System

IQR Inpatient Quality Reporting

ISO Insurance service office

IT Information technology

IWPUT Intensity of work per unit of time

LCD Local coverage determination

MA Medicare Advantage

MAC Medicare Administrative Contractor

MAP Measure Applications Partnership

MAPCP Multi-payer Advanced Primary Care Practice

MAV Measure application validity [process]

MCP Monthly capitation payment

MedPAC Medicare Payment Advisory Commission

MEI Medicare Economic Index

MFP Multi-Factor Productivity

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

MMA Medicare Prescription Drug, Improvement and Modernization Act of 2003 (Pub. L. 108-173, enacted on December 8, 2003)

MP Malpractice

MPPR Multiple procedure payment reduction

MRA Magnetic resonance angiography

MRI Magnetic resonance imaging

MSA Metropolitan Statistical Areas

MSPB Medicare Spending per Beneficiary

MU Meaningful use

NCD National coverage determination

NCQDIS National Coalition of Quality Diagnostic Imaging Services

NP Nurse practitioner

NPI National Provider Identifier

NPP Nonphysician practitioner

NQS National Quality Strategy

OACT CMS's Office of the Actuary

OBRA '89 Omnibus Budget Reconciliation Act of 1989 (Pub. L. 101-239)

OBRA '90 Omnibus Budget Reconciliation Act of 1990 (Pub. L. 101-508)

OES Occupational Employment Statistics

OMB Office of Management and Budget

OPPS Outpatient prospective payment system

OT Occupational therapy

PA Physician assistant

PAMA Protecting Access to Medicare Act of 2014 (Pub. L. 113-93)

PC Professional component

PCIP Primary Care Incentive Payment

PE Practice expense

PE/HR Practice expense per hour

PEAC Practice Expense Advisory Committee

PECOS Provider Enrollment, Chain, and Ownership System

PFS Physician Fee Schedule

PLI Professional Liability Insurance

PMA Premarket approval

PQRS Physician Quality Reporting System

PPIS Physician Practice Expense Information Survey

PT Physical therapy

PY Performance year

QCDR Qualified clinical data registry

QRUR Quality and Resources Use Report

RBRVS Resource-based relative value scale

RFA Regulatory Flexibility Act

RHC Rural health clinic

RIA Regulatory impact analysis

RUC American Medical Association/Specialty Society Relative (Value) Update Committee

RUCA Rural Urban Commuting Area

RVU Relative value unit

SBA Small Business Administration

SGR Sustainable growth rate

SIM State Innovation Model

SLP Speech-language pathology

SMS Socioeconomic Monitoring System

SNF Skilled nursing facility

TAP Technical Advisory Panel

TC Technical component

TIN Tax identification number

UAF Update adjustment factor

UPIN Unique Physician Identification Number

USPSTF United States Preventive Services Task Force

VBP Value-based purchasing

VM Value-Based Payment Modifier

Addenda Available Only Through the Internet on the CMS Web Site

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 2016 PFS Final Rule with Comment Period, refer to item CMS-1631-FC. Readers who experience any problems accessing any of the Addenda or other documents referenced in this rule and posted on the CMS Web site identified above should contact Donta Henson at (410) 786-1947.

CPT (Current Procedural Terminology) Copyright Notice

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 2015 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

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. These changes are applicable to services furnished in CY 2016.

2. Summary of the Major Provisions

The Social Security Act (the 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's payment amounts for all physicians' services paid under the PFS, 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 2016 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 proposals regarding:

  • Potentially Misvalued PFS Codes.
  • Telehealth Services.
  • Advance Care Planning.
  • Establishing Values for New, Revised, and Misvalued Codes.
  • Target for Relative Value Adjustments for Misvalued Services.
  • Phase-in of Significant RVU Reductions.
  • “Incident to” policy.
  • Portable X-ray Transportation Fee.
  • Updating the Ambulance Fee Schedule regulations.
  • Changes in Geographic Area Delineations for Ambulance Payment.
  • Chronic Care Management Services for RHCs and FQHCs.
  • HCPCS Coding for RHCs.
  • Payment to Grandfathered Tribal FQHCs that were Provider-Based Clinics on or before April 7, 2000.
  • Payment for Biosimilars under Medicare Part B.
  • Physician Compare Web site.
  • Physician Quality Reporting System.
  • Medicare Shared Savings Program.
  • Electronic Health Record (EHR) Incentive Program.Start Printed Page 70889
  • Value-Based Payment Modifier and the Physician Feedback Program.

3. Summary of Costs and Benefits

The Act requires that annual adjustments to PFS RVUs may not cause annual estimated expenditures to differ by more than $20 million from what they would have been had the adjustments not been made. If adjustments to RVUs would cause expenditures to change by more than $20 million, we must make adjustments to preserve budget neutrality. These adjustments can affect the distribution of Medicare expenditures across specialties. In addition, several changes in this final rule with comment period will affect the specialty distribution of Medicare expenditures. When considering the combined impact of work, PE, and MP RVU changes, the projected payment impacts are small for most specialties; however, the impact is larger for a few specialties.

We have determined that this major 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 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 (Pub. L. 101-239, enacted on December 19, 1989) (OBRA '89), and the Omnibus Budget Reconciliation Act of 1990 (Pub. L. 101-508, enacted on November 5, 1990) (OBRA '90). 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 major final rule with comment period, unless otherwise noted, the term “practitioner” is used to describe both physicians and nonphysician practitioners (NPPs) 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 work RVUs established for the initial fee schedule, which was implemented on January 1, 1992, were developed with extensive input from the physician community. A research team at the Harvard School of Public Health developed the original 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.

As specified in section 1848(c)(1)(A) of the Act, the work component of physicians' services means the portion of the resources used in furnishing the service that reflects physician time and intensity. We establish work RVUs for new, revised and potentially misvalued codes based on our review of information that generally includes, but is not limited to, recommendations received from the American Medical Association/Specialty Society Relative Value Update Committee (RUC), the Health Care Professionals Advisory Committee (HCPAC), the Medicare Payment Advisory Commission (MedPAC), and other public commenters; medical literature and comparative databases; as well as a comparison of the work for other codes within the Medicare PFS, and consultation with other physicians and health care professionals within CMS and the federal government. We also assess the methodology and data used to develop the recommendations submitted to us by the RUC and other public commenters, and the rationale for their recommendations.

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 (Pub. L. 103-432, 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. The PE RVUs continue to represent the portion of these resources involved in furnishing PFS services.

Originally, the resource-based method was to be used beginning in 1998, but section 4505(a) of the Balanced Budget Act of 1997 (Pub. L. 105-33, enacted on August 5, 1997) (BBA) 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 on 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 nonfacility 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 (Pub. L. 106-113, enacted on November 29, 1999) (BBRA) 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 Start Printed Page 70890period 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 commercial and physician-owned insurers' malpractice insurance premium data from all the states, the District of Columbia, and Puerto Rico. For more information on MP RVUs, see section II.B.2. of this final rule with comment period.

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.

Although refinements to the direct PE inputs initially relied heavily on input from the 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.

In addition to the five-year reviews, beginning for CY 2009, CMS, and the 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.

e. Application of Budget Neutrality to Adjustments of RVUs

As described in section VI.C. 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 cause expenditures for the year to change by more than $20 million, we make adjustments to ensure that expenditures did not increase or decrease by more than $20 million.

2. Calculation of Payments Based on RVUs

To calculate the payment for each 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 work, PE, and MP in an area compared to the national average costs for each component.

We received several comments regarding GPCIs that are not within the scope of proposals in the CY 2016 PFS proposed rule. Many of these commenters requested adjustments to GPCI values for the Puerto Rico payment locality. These commenters contend that the data used to calculate GPCIs do not accurately reflect the cost of medical practice in Puerto Rico. We have addressed some of these issues in response to specific comments in prior rulemaking, such as the CY 2014 PFS final rule with comment period (78 FR 74380 through 74391), and will further take comments into account when we next propose to update GPCIs. However, we also note that we anticipate proposing updated GPCIs during CY 2017 rulemaking, and in the context of that update, we will consider the concerns expressed by commenters and others regarding the GPCIs for the Puerto Rico locality.

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 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

Section 220(d) of the Protecting Access to Medicare Act of 2014 (PAMA) (Pub. L. 113-93, enacted on April 1, 2014) added a new subparagraph (O) to section 1848(c)(2) of the Act to establish an annual target for reductions in PFS expenditures resulting from adjustments to relative values of misvalued codes. If the estimated net reduction in expenditures for a year is equal to or greater than the target for that year, the provision specifies that reduced expenditures attributable to such adjustments shall be redistributed in a budget-neutral manner within the PFS. The provision specifies that the amount by which such reduced expenditures exceed the target for a given year shall be treated as a reduction in expenditures for the subsequent year for purposes of determining whether the target for the subsequent year has been met. The provision also specifies that an amount equal to the difference between the target and the estimated net reduction in expenditures, called the target recapture amount, shall not be taken into account when applying the budget neutrality requirements specified in section 1848(c)(2)(B)(ii)(II) of the Act. The PAMA amendments originally made the target provisions applicable for CYs 2017 through 2020 and set the target for reduced expenditures at 0.5 percent of estimated expenditures under the PFS for each of those 4 years.Start Printed Page 70891

Subsequently, section 202 of the Achieving a Better Life Experience Act of 2014 (ABLE) (Division B of Pub. L. 113-295, enacted December 19, 2014) accelerated the application of the target, amending section 1848(c)(2)(O) of the Act to specify that target provisions apply for CYs 2016, 2017, and 2018; and setting a 1 percent target for reduced expenditures for CY 2016 and a 0.5 percent target for CYs 2017 and 2018. The implementation of the target legislation is discussed in section II.E. of this final rule with comment period.

Section 1848(c)(7) of the Act, as added by section 220(e) of the PAMA, specified that for services that are not new or revised codes, if the total RVUs for a service for a year would otherwise be decreased by an estimated 20 percent or more as compared to the total RVUs for the previous year, the applicable adjustments in work, PE, and MP RVUs shall be phased in over a 2-year period. Section 220(e) of the PAMA required the phase-in of RVU reductions of 20 percent or more to begin for 2017. Section 1848(c)(7) of the Act was later amended by section 202 of the ABLE Act to require instead that the phase-in must begin in CY 2016. The implementation of the phase-in legislation is discussed in section II.F. of this final rule with comment period.

Section 218(a) of the PAMA added a new section 1834(p) of the Act. Section 1834(p) of the Act requires for certain computed tomography (CT) services reductions in payment for the technical component (TC) (and the TC of the global fee) of the PFS service and in the hospital OPPS payment (5 percent in 2016, and 15 percent in 2017 and subsequent years). The CT services that are subject to the payment reduction are services identified as of January 1, 2014 by HCPCS codes 70450-70498, 71250-71275, 72125-72133, 72191-72194, 73200-73206, 73700-73706, 74150-74178, 74261-74263, and 75571-75574, and succeeding codes, that are furnished using equipment that does not meet each of the attributes of the National Electrical Manufacturers Association (NEMA) Standard XR-29-2013, entitled “Standard Attributes on CT Equipment Related to Dose Optimization and Management.” The implementation of the amendments made by section 218(a) of the PAMA is discussed in section II.G. of this final rule with comment period.

The Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) (Pub. L. 114-10, enacted on April 16, 2015) makes several changes to the statute, including but not limited to:

(1) Repealing the sustainable growth rate (SGR) update methodology for physicians' services.

(2) Revising the PFS update for 2015 and subsequent years.

(3) Requiring that we establish a Merit-based Incentive Payment System (MIPS) under which MIPS eligible professionals (initially including physicians, physician assistants, nurse practitioners, clinical nurse specialists, and certified registered nurse anesthetists) receive annual payment adjustments (increases or decreases) based on their performance in a prior period. These and other MACRA provisions are discussions in various sections of this final rule with comment period. Please refer to the table of contents for the location of the various MACRA provision discussions.

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

A. Determination of 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. As required by section 1848(c)(2)(C)(ii) of the Act, we use a resource-based system for determining PE RVUs for each physicians' service. We develop PE RVUs by considering 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.

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, medical supplies, and medical equipment) 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 generally based on our review of recommendations received from the 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).

Comment: Several commenters requested that CMS include pharmacists as active qualified health care providers for purposes of calculating physician PE direct costs. The commenters stated that there are a number of ongoing Center for Medicare and Medicaid Innovation (CMMI) initiatives in which pharmacists are making substantial contributions to redesigning healthcare delivery and financing. The commenters insisted that pharmacists need to be included in the calculation of direct PE expenses as an element of the clinical labor variable relating to physician services, to ensure optimal medication therapy outcomes for beneficiaries, and the absence of these pharmacists negatively impacts the health care system.

Response: The direct PE input database contains the service-level costs in clinical labor based on the typical service furnished to Medicare beneficiaries. Commenters did not suggest that the labor costs of pharmacists are a typical resource cost in furnishing any particular physicians' service. When such costs are typically incurred in furnishing such services, we do not have any standing policies that would prohibit the inclusion of the costs in the direct PE input database used to develop PE RVUs for individual services, to the extent that inclusion of such costs would not lead to duplicative payments. Therefore, we welcome more detailed information regarding the typical clinical labor costs involving pharmacists for particular PFS services. We note, however, that in many of the CMMI initiatives, payment is provided for care management and care coordination services, including services provided by pharmacists. As such, we encourage commenters to provide information about the inclusion of additional clinical labor costs for specific services described by HCPCS codes for which payment is made under the PFS, as opposed to clinical labor costs that may be typical only under certain initiatives.Start Printed Page 70892

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 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, PE RVUs from CY 2013 forward 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.

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 for work 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).

For CY 2016, we have incorporated the available utilization data for interventional cardiology, which became a recognized Medicare specialty during 2014. We proposed to use a proxy PE/HR value for interventional cardiology, as there are no PPIS data for this specialty, by crosswalking the PE/HR from Cardiology, since the specialties furnish similar services in the Medicare claims data. The change is reflected in the “PE/HR” file available on the CMS Web site under the supporting data files for the CY 2016 PFS proposed rule at http://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​PhysicianFeeSched/​index.html.

Comment: One commenter expressed support for the new proposal to use a proxy PE per hour for interventional cardiology by crosswalking to the PE/HR for cardiology.

Response: We appreciate the commenter's support and are finalizing the crosswalk as proposed.

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, medical supplies, and medical equipment) 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.A.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 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 as follows:

  • For a given service, we used 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. That is, 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 Start Printed Page 70893initial 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 added 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 incorporated 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.

(4) Facility and Nonfacility Costs

For procedures that can be furnished in a physician's office, as well as in a hospital or other 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.

(5) 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.)

(6) 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).

(a) 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.

(b) 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. Under our current methodology, we first multiply the current year's conversion factor by the product of the current year's PE RVUs and utilization for each service to arrive at the aggregate pool of total PE costs (Step 2a). We then calculate the average direct percentage of the current pool of PE RVUs (using a weighted average of the survey data for the specialties that furnish each service (Step 2b).) We then multiply the result of 2a by the result of 2b to arrive at the aggregate pool of direct PE costs for the current year. For CY 2016, we proposed a technical improvement to step 2a of this calculation. In place of the step 2a calculation described above, we proposed to set the aggregate pool of PE costs equal to the product of the ratio of the current aggregate PE RVUs to current aggregate work RVUs and the proposed aggregate work RVUs. Historically, in allowing the current PE RVUs to determine the size of the base PE pool in the PE methodology, we have assumed that the relationship of PE RVUs to work RVUs is constant from year to year. Since this is not ordinarily the case, by not considering the proposed aggregate work RVUs in determining the size of the base PE pool, we have introduced some minor instability from year to year in the relative shares of work, PE, and MP RVUs. Although this modification would result in greater stability in the relationship among the work and PE RVU components in the aggregate, we do not anticipate it will affect the distribution of PE RVUs across specialties. The PE RVUs in addendum B of this final rule with comment period reflect this refinement to the PE methodology.

We did not receive any comments on this proposed refinement of the methodology. Therefore, we are finalizing this refinement as proposed.

Step 3: Calculate the aggregate pool of direct PE costs for use in ratesetting. This is the product of the aggregate direct costs for all services from Step 1 and the utilization data for that service.

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.

(c) 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.

Historically, we have used the specialties that furnish the service in the most recent full year of Medicare claims data (crosswalked to the current year set of codes) to determine which specialties furnish individual procedures. For example, for CY 2015 ratesetting, we used the mix of specialties that Start Printed Page 70894furnished the services in the CY 2013 claims data to determine the specialty mix assigned to each code. Although we believe that there are clear advantages to using the most recent available data in making these determinations, we have also found that using a single year of data contributes to greater year-to-year instability in PE RVUs for individual codes and often creates extreme, annual fluctuations for low-volume services, as well as delayed fluctuations for some services described by new codes once claims data for those codes becomes available. We believe that using an average of the three most recent years of available data may increase stability of PE RVUs and mitigate code-level fluctuations for both the full range of PFS codes, and for new and low-volume codes in particular. Therefore, we proposed to refine this step of the PE methodology to use an average of the 3 most recent years of available Medicare claims data to determine the specialty mix assigned to each code. The PE RVUs in Addendum B of the CMS Web site reflect this refinement to the PE methodology.

Comment: We received several comments supporting this proposed refinement of the methodology. Several commenters also urged us to override the utilization data for low-volume codes using a recommended list of expected specialty or dominant specialty, consistent with our previous approach.

Response: We appreciate the support for the use of the 3-year average of claims utilization for purposes of determining the specialty mix for individual service. As we stated in our proposal, we believe that the 3-year average will mitigate the need to use dominant or expected specialty instead of the claims data. However, we also understand that the hypothesis will be tested as soon as a new year of claims data is incorporated into the PFS ratesetting methodology. Because we anticipate incorporating CY 2015 claims data for use in CY 2017 ratesetting, we believe that the proposed PE RVUs associated with the CY 2017 PFS proposed rule will provide the best opportunity to determine whether service-level overrides of claims data are necessary. Therefore, we are finalizing the policy as proposed for CY 2016 but will seek comment on the proposed CY 2017 PFS rates and whether or not the incorporation a new year of utilization data mitigates the need for service-level overrides. At that time, we would reconsider whether or not to use a claims-based approach (dominant specialty) or stakeholder-recommended approach (expected specialty) in the development of PE RVUs for low-volume codes.

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 labor 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 labor 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 labor 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 result of step 2a (as calculated with the proposed change) 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.

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 work 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.

(d) 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. The final PE BN adjustment is calculated by comparing the results of Step 18 to the proposed aggregate work RVUs scaled by the ratio of current aggregate PE and work RVUs, consistent with the proposed changes in Steps 2 and 9. 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 Start Printed Page 70895ratesetting calculation” later in this section.)

(e) 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

Specialty codeSpecialty description
49Ambulatory surgical center.
50Nurse practitioner.
51Medical supply company with certified orthotist.
52Medical supply company with certified prosthetist.
53Medical supply company with certified prosthetist-orthotist.
54Medical supply company not included in 51, 52, or 53.
55Individual certified orthotist.
56Individual certified prosthetist.
57Individual certified prosthetist-orthotist.
58Medical supply company with registered pharmacist.
59Ambulance service supplier, e.g., private ambulance companies, funeral homes, etc.
60Public health or welfare agencies.
61Voluntary health or charitable agencies.
73Mass immunization roster biller.
74Radiation therapy centers.
87All other suppliers (e.g., drug and department stores).
88Unknown supplier/provider specialty.
89Certified clinical nurse specialist.
96Optician.
97Physician assistant.
A0Hospital.
A1SNF.
A2Intermediate care nursing facility.
A3Nursing facility, other.
A4HHA.
A5Pharmacy.
A6Medical supply company with respiratory therapist.
A7Department store.
B2Pedorthic personnel.
B3Medical 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 work 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

ModifierDescriptionVolume adjustmentTime adjustment
80,81,82Assistant at Surgery16%Intraoperative portion.
ASAssistant at Surgery—Physician Assistant14% (85% * 16%)Intraoperative portion.
50 or LT and RTBilateral Surgery150%150% of work time.
51Multiple Procedure50%Intraoperative portion.
52Reduced Services50%50%.
Start Printed Page 70896
53Discontinued Procedure50%50%.
54Intraoperative Care onlyPreoperative + Intraoperative Percentages on the payment files used by Medicare contractors to process Medicare claimsPreoperative + Intraoperative portion.
55Postoperative Care onlyPostoperative Percentage on the payment files used by Medicare contractors to process Medicare claimsPostoperative portion.
62Co-surgeons62.5%50%.
66Team Surgeons33%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 (MPPRs). 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 we use the average allowed charge when simulating RVUs; therefore, the RVUs as calculated already reflect the payments as adjusted by modifiers, and no volume adjustments are necessary. However, a time adjustment of 33 percent is made only for medical direction of two to four cases since that is the only situation where a single practitioner is involved with multiple beneficiaries concurrently, so that counting each service without regard to the overlap with other services would overstate the amount of time spent by the practitioner furnishing these services.

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

The following is a summary of the comments we received regarding PE RVU methodology.

Comment: We received several comments in response to our proposal to use the 3 most recent years of Medicare claims data to determine the specialty mix assigned to each code. All commenters broadly supported the proposal to use a 3-year average to increase stability of PE RVUs and mitigate code-level fluctuations. Some commenters, including the RUC, also stated that for codes which are very low volume in the Medicare population, the dominant specialty(ies) should be assigned. These commenters stressed that CMS should continue to utilize the expertise of the RUC when making these assignments.

Response: For services that are newly created or very low volume, we will continue to explore different methods to ensure the utilization of the most accurate specialty mix.

(7) 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 which we use a 90 percent assumption as required by section 1848(b)(4)(C) of the Act. We also direct the reader to section II.H.6.b of this final rule with comment period for a discussion of our change in the utilization rate assumption for the linear accelerator used in furnishing radiation treatment services.

Maintenance: This factor for maintenance was proposed and finalized during rulemaking for CY 1998 PFS (62 FR 33164). Several stakeholders have suggested that this maintenance factor assumption should be variable, similar to other assumptions in the equipment cost per minute calculation. In CY 2015 rulemaking, we solicited comments regarding the availability of reliable data on maintenance costs that vary for particular equipment items. We received several comments about variable maintenance costs, and in reviewing the information offered in those comments, it is clear that the relationship between maintenance costs and the price of equipment is not necessarily uniform across equipment. After reviewing the comments received, we have been unable to identify a systematic way of varying the maintenance cost assumption relative to the price or useful life of equipment. Therefore, to accommodate a variable, as opposed to a standard, maintenance rate within the equipment cost per minute calculation, we believe we would have to gather and maintain valid data on the maintenance costs for each equipment item in the direct PE input database, much like we do for price and useful life.

Given our longstanding difficulties in acquiring accurate pricing information for equipment items, we solicited comments on whether adding another item-specific financial variable for equipment costs will be likely to increase the accuracy of PE RVUs across the PFS. We noted that most of the information for maintenance costs we have received is for capital equipment, and for the most part, this information has been limited to single invoices. Like the invoices for the equipment items themselves, we do not believe that very small numbers of voluntarily submitted invoices are likely to reflect typical costs for all of the same reasons we have discussed in previous rulemaking. We noted that some commenters submitted high-level summary data from informal surveys but we currently have no means to validate that data. Therefore, we continue to seek a source of publicly available data on actual maintenance costs for medical equipment to improve the accuracy of the equipment costs used in developing PE RVUs.

Comment: Many commenters stated that the current 5 percent equipment maintenance factor does not account for expensive maintenance contracts on pieces of highly technical equipment. Most commenters were supportive of the idea of adding an item-specific maintenance variable for equipment costs, which they stated would likely increase the accuracy of the PE RVUs across the PFS. These commenters stated that specialty societies and other stakeholders should be allowed to provide documentation to CMS, as they Start Printed Page 70897currently do for pricing new supplies and equipment, to apply for an increase in maintenance costs. Other commenters requested that if a fixed maintenance factor remains in place, it should be increased from 5 percent to 10 percent. One commenter expressed concern that CMS would entertain making a change in this aspect of the equipment cost per minute formula based on a few invoices when a change would impact every service in the fee schedule. The commenter expressed concerns with the possibility that CMS might adopt a variable maintenance factor based on the submission of individual invoices. Another commenter stated that without a systematic data collection methodology for determining maintenance factors, they had concerns that any invoices CMS received might not accurately capture the true costs of equipment maintenance.

Although most commenters were supportive of adopting a variable maintenance factor for equipment items, commenters also stated that they were unaware of any publicly available data source containing this information. One commenter agreed that there is no comprehensive data source for the maintenance information and therefore it would be difficult to implement a variable maintenance formula. Multiple other commenters concurred that they were unaware of any such public dataset. Several commenters encouraged CMS to work with stakeholders to define service contracts/maintenance contracts, collect data on their associated costs and update the equipment maintenance adjustment factor as necessary.

Response: We appreciate the submission of extensive comments regarding the subject of equipment maintenance factor. We agree with commenters that we do not believe the annual maintenance factor for all equipment is exactly 5 percent, and we concur that the current rate likely understates the true cost of maintaining some equipment. We also believe it likely overstates the maintenance costs for other equipment. However, in the absence of publicly available datasets regarding equipment maintenance costs or another systematic data collection methodology for determining maintenance factor, we do not believe that we have sufficient information at present to adopt a variable maintenance factor for equipment cost per minute pricing. While we believe that these costs ideally should be incorporated into the PE methodology, we also have serious concerns about the problems that result from incorporating anecdotal data based solely on voluntarily submitted pricing information. In establishing prices for equipment and supplies, in many cases we have found that the submitted invoices often overstate the costs for individual items relative to publically available prices. We believe that the incentives related to voluntarily submitted limited invoices for maintenance costs would likely produce information subject to similar limitations. However, in contrast to prices, where we have identified no feasible alternative, our alternative for determining maintenance rates is a long-established default maintenance rate. We also note that the amount of costs for maintenance under the current methodology is directly proportional to the equipment prices, largely determined by the voluntarily submitted invoices for particular equipment items. Therefore, we believe that absent an auditable, robust data source, using anecdotal data for maintenance costs is likely to compound the current problems of pricing equipment costs accurately, not increase accuracy.

We will continue to investigate potential avenues for determining equipment maintenance costs across a broad range of equipment items.

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 3. (See 77 FR 68902 for a thorough discussion of this issue.) We did not propose any changes to these interest rates for CY 2016.

Table 3A—SBA Maximum Interest Rates

PriceUseful lifeInterest rate (%)
<$25K<7 Years7.50
$25K to $50K<7 Years6.50
>$50K<7 Years5.50
<$25K7+ Years8.00
$25K to $50K7+ Years7.00
>$50K7+ Years6.00
Start Printed Page 70898

Table 4—Calculation of PE RVUs Under Methodology for Selected Codes

StepSourceFormula99213 Office visit, est nonfacility33533 CABG, arterial, single facility71020 Chest x-ray nonfacility71020-TC Chest x-ray, nonfacility71020-26 Chest x-ray, nonfacility93000 ECG, complete, nonfacility93005 ECG, tracing nonfacility93010 ECG, report nonfacility
(1) Labor cost (Lab)Step 1AMA13.3277.525.745.7405.15.10
(2) Supply cost (Sup)Step 1AMA2.987.340.530.5301.191.190
(3) Equipment cost (Eqp)Step 1AMA0.170.587.087.0800.090.090
(4) Direct cost (Dir)Step 1=(1)+(2)+(3)16.4885.4513.3613.3606.386.380
(5) Direct adjustment (Dir. Adj.)Steps 2-4See Footnote*0.59570.59570.59570.59570.59570.59570.59570.5957
(6) Adjusted LaborSteps 2-4=(1)*(5)7.9346.183.423.4203.043.040
(7) Adjusted SuppliesSteps 2-4=Eqp * Dir Adj=(2)*(5)1.784.370.320.3200.710.710
(8) Adjusted EquipmentSteps 2-4=Sup * Dir Adj=(3)*(5)0.10.354.224.2200.050.050
(9) Adjusted DirectSteps 2-4=(6)+(7)+(8)9.8250.97.967.9603.83.80
(10) Conversion Factor (CF)Step 5PFS35.933535.933535.933535.933535.933535.933535.933535.9335
(11) Adj. labor cost convertedStep 5=(Lab * Dir Adj)/CF=(6)/(10)0.221.290.10.100.080.080
(12) Adj. supply cost convertedStep 5=(Sup * Dir Adj)/CF=(7)/(10)0.050.120.010.0100.020.020
(13) Adj. equipment cost convertedStep 5=(Eqp * Dir Adj)/CF=(8)/(10)00.010.120.120000
(14) Adj. direct cost convertedStep 5=(11)+(12)+(13)0.271.420.220.2200.110.110
(15) Work RVUSetup FilePFS0.9733.750.2200.220.1700.17
(16) Dir_pctSteps 6,7Surveys0.250.170.290.290.290.290.290.29
(17) Ind_pctSteps 6,7Surveys0.750.830.710.710.710.710.710.71
(18) Ind. Alloc. Formula (1st part)Step 8See Step 814/ (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 8See 180.836.70.540.5400.260.260
(20) Ind. Alloc. Formula (2nd pt)Step 8See Step 8(15)(15)(15+11)(11)(15)(15+11)(11)(15)
(21) Ind. Alloc.(2nd part)Step 8See 200.9733.750.320.10.220.250.080.17
(22) Indirect Allocator (1st + 2nd)Step 8=(19)+(21)1.840.450.850.630.220.520.350.17
(23) Indirect Adjustment (Ind Adj)Steps 9-11See Footnote**0.38160.38160.38160.38160.38160.38160.38160.3816
(24) Adjusted Indirect AllocatorSteps 9-11=Ind Alloc * Ind Adj0.6915.440.330.240.080.20.130.06
(25) Ind. Practice Cost Index (IPCI)Steps 12-161.070.760.980.980.980.90.90.9
(26) Adjusted IndirectStep 17= Adj.Ind Alloc * PCI=(24)*(25)0.7311.710.320.240.080.180.120.06
(27) Final PE RVUStep 18=(Adj Dir + Adj Ind) * Other Adj=((14)+(26)) * Other Adj)1.0113.160.540.460.080.280.230.06
CPT codes and descriptions are copyright 2015 American Medical Association. All Rights Reserved. Applicable FARS/DFARS apply.
Notes: PE RVUs above (row 27), may not match Addendum B due to rounding.
The use of any particular conversion factor (CF) in the table to illustrate the PE Calculation has no effect on the resulting RVUs.
*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].
Start Printed Page 70899

c. Changes to Direct PE Inputs for Specific Services

This section focusses on specific PE inputs that we addressed in the proposed rule. The direct PE inputs are included in the CY 2016 direct PE input database, which is available on the CMS Web site under downloads for the CY 2016 PFS final rule with comment period at http://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​PhysicianFeeSched/​PFS-Federal-Regulation-Notices.html.

(1) PE Inputs for Digital Imaging Services

Prior to CY 2015 rulemaking, the RUC provided a recommendation regarding the PE inputs for digital imaging services. Specifically, the RUC recommended that we remove supply and equipment items associated with film technology from a list of codes since these items are no longer typical resource inputs. The RUC also recommended that the Picture Archiving and Communication System (PACS) equipment be included for these imaging services since these items are now typically used in furnishing imaging services. However, since we did not receive any invoices for the PACS system, we were unable to determine the appropriate pricing to use for the inputs. For CY 2015, we proposed, and finalized our proposal, to remove the film supply and equipment items, and to create a new equipment item as a proxy for the PACS workstation as a direct expense. We used the current price associated with ED021 (computer, desktop, w-monitor) to price the new item, ED050 (PACS Workstation Proxy), pending receipt of invoices to facilitate pricing specific to the PACS workstation.

Subsequent to establishing payment rates for CY 2015, we received information from several stakeholders regarding pricing for items related to the digital acquisition and storage of images. Some of these stakeholders submitted information that included prices for items clearly categorized as indirect costs within the established PE methodology and equivalent to the storage mechanisms for film. Additionally, some of the invoices we received included other products (like training and maintenance costs) in addition to the equipment items, and there was no distinction on these invoices between the prices for the equipment items themselves and the related services. However, we did receive invoices from one stakeholder that facilitated a proposed price update for the PACS workstation. Therefore, we proposed to update the price for the PACS workstation to $5,557 from the current price of $2,501 since the latter price was based on the proxy item and the former based on submitted invoices. The PE RVUs in Addendum B on the CMS Web site reflect the updated price.

In addition to the workstation used by the clinical staff acquiring the images and furnishing the TC of the services, a stakeholder also submitted more detailed information regarding a workstation used by the practitioner interpreting the image in furnishing the PC of many of these services.

As we stated in the CY 2015 final rule with comment period (79 FR 67563), we generally believe that workstations used by these practitioners are more accurately considered indirect costs associated with the PC of the service. However, we understand that the professional workstations for interpretation of digital images are similar in principle to some of the previous film inputs incorporated into the global and technical components of the codes. Given that many of these services are reported globally in the nonfacility setting, we believe it may be appropriate to include these costs as direct inputs for the associated HCPCS codes. Based on our established methodology, these costs would be incorporated into the PE RVUs of the global and technical component of the HCPCS code.

We solicited comments on whether including the professional workstation as a direct PE input for these codes would be appropriate, given that the resulting PE RVUs would be assigned to the global and technical components of the codes.

Comment: Many commenters supported the equipment price increase to $5,557 for the PACS workstation. Commenters stated that this is a more accurate amount than the current price of $2,501. However, many commenters, including the RUC, stated that this price did not capture the appropriate pricing for the PC of the PACS workstation. One commenter expressed concerns with the method that CMS employed to establish the proposed price for the PACS workstation, disregarded the invoices and accompanying explanations submitted by several stakeholders and instead relying on the information submitted by a single group.

Response: We acknowledge and appreciate that several stakeholders provided information intended to facilitate our pricing of the equipment related to PACS. However, much of that submitted information included costs that are considered indirect PE under the established methodology. We considered all of the submitted information and used the submitted prices that were consistent with the principles established under the PE methodology.

Comment: Many commenters, including the RUC, stated that the proposed price did not capture the appropriate pricing for the PC of the PACS workstation. Several commenters indicated that the professional workstation was a direct PE item due to the fact that it is used for individual studies (one at a time) in the non-facility setting, and its use involves a bi-directional exchange between a technologist and a radiologist while the TC is being provided. These commenters also suggested that the professional PACS workstation was a direct proxy for the film alternators, film processors, and view-boxes previously considered direct PE inputs for many of these services prior to the film to digital conversion. Several commenters suggested that the true cost of the PACS workstation was significantly higher than the proposed $5,557 due to these professional expenses.

Response: We appreciate the extensive feedback regarding the potential addition of a PC to the PACS workstation. We agree that the costs of the professional workstation may be analogous to costs previously incorporated as direct PE inputs for these services. Therefore, we are seeking comments and recommendations from stakeholders, including the RUC, regarding which codes would require the professional PACS workstation and for how many minutes the professional equipment workstation would be used relative to the work time or clinical labor tasks associated with individual codes. We would address any such recommendations in future rulemaking.

Comment: One commenter stated that the CMS' attempt to analogize elements of a PACS workstation to the historic inputs associated with film technology was inherently flawed. This commenter stated that CMS should not characterize critical elements of the PACS workstation as indirect costs because film technology is fundamentally distinct from digital technology. The commenter indicated that the PACS workstation requires specific software to function, and the costs associated with training, maintenance, and warranties for the PACS workstation have not been factored into the cost of the equipment. The commenter suggested that not including these as direct costs reflects a mistaken assumption that a PACS workstation has functionality for non-imaging services, such as patient Start Printed Page 70900scheduling, billing, or electronic medical records capability.

Response: We believe that maintaining consistent treatment of PE costs is of central importance in the resource-based relative value system. Since the PE RVUs for individual services are relative to all other PFS services, we believe that we must categorize typical costs for individual services into the direct and indirect categories using the same definitions that apply to all PFS services. We believe it would be inconsistent with cost-based relative value principles to change the definition of those categories for particular procedures or tests, even when technology changes. Centralized record keeping systems, containing clinical or billing information are considered indirect expenses across the PFS. Due to technological changes, some of these systems are well-integrated into equipment items with clinical functionality, while others remain completely distinct. In pricing and categorizing these costs, we have aimed to separate these costs where possible and believe we have maintained relativity among PFS services to the greatest extent possible. We remind commenters that indirect PE RVUs are included for every nationally priced PFS service and that these RVUs contribute to payment for each and every service. We also note that over time, indirect costs change as direct costs change. For example, changes in technology might result in particular items using more or less office space, or using more or less electricity. We do not believe it would be appropriate to redefine indirect costs as direct costs whenever we have reason to believe that indirect costs have changed due to changes in technology. Instead, we acknowledge that indirect costs change over time for all those who are paid through the Medicare PFS, making it even more important to follow the established principles of relativity in establishing direct PE inputs.

After consideration of comments received, we are finalizing our proposal to update the price for the PACS workstation to $5,557 from the current price of $2,501.

As we noted in the proposed rule, one commenter expressed concern about the changes in direct PE inputs for CPT code 76377, (3D radiographic procedure with computerized image post-processing), that were proposed and finalized in CY 2015 rulemaking as part of the film to digital change. Based on a recommendation from the RUC, we removed the input called “computer workstation, 3D reconstruction CT-MR” from the direct PE input database and assigned the associated minutes to the proxy for the PACS workstation. Therefore, we sought comment from stakeholders, including the RUC, about whether or not the PACS workstation used in imaging codes is the same workstation that is used in the post-processing described by CPT code 76377, or if a more specific workstation should be incorporated in the direct PE input database.

Comment: Multiple commenters indicated that CPT code 76377 requires image post-processing on an independent workstation. Commenters stated that the “computer workstation, 3D reconstruction CT-MR” equipment (ED014), which was removed by the RUC from the equipment list for this procedure, is separate from the PACS workstation and performs a different function. The commenters requested that ED014 be restored to the equipment inputs for CPT code 76377 and assigned 38 minutes of equipment time. The commenters also suggested that the PACS workstation should remain as a separate direct PE expense as well, since there are additional PACS related activities specific to the 3-D images after they have been created on the computer workstation.

Response: We appreciate the additional information regarding the use of the 3D reconstruction computer workstation for CPT code 76377. After consideration of comments received, we agree that the “computer workstation, 3D reconstruction CT-MR” equipment (ED014) should be restored to the equipment list and assigned to CPT code 76377 with an equipment time of 38 minutes. However, we do not believe that the typical service for CPT code 76377 would also use the PACS workstation. Therefore, we substituted ED014 in place of the PACS workstation.

(2) Standardization of Clinical Labor Tasks

As we noted in PFS rulemaking for CY 2015, we continue to work on revisions to the direct PE input database to provide the number of clinical labor minutes assigned for each task for every code in the database instead of only including the number of clinical labor minutes for the pre-service, service, and post-service periods for each code. In addition to increasing the transparency of the information used to set PE RVUs, this improvement would allow us to compare clinical labor times for activities associated with services across the PFS, which we believe is important to maintaining the relativity of the direct PE inputs. This information will facilitate the identification of the usual numbers of minutes for clinical labor tasks and the identification of exceptions to the usual values. It will also allow for greater transparency and consistency in the assignment of equipment minutes based on clinical labor times. Finally, we believe that the information can be useful in maintaining standard times for particular clinical labor tasks that can be applied consistently to many codes as they are valued over several years, similar in principle to the use of physician pre-service time packages. We believe such standards will provide greater consistency among codes that share the same clinical labor tasks and could improve relativity of values among codes. For example, as medical practice and technologies change over time, changes in the standards could be updated at once for all codes with the applicable clinical labor tasks, instead of waiting for individual codes to be reviewed.

Although this work is not yet complete, we anticipate completing it in the near future. In the following paragraphs, we address a series of issues related to clinical labor tasks, particularly relevant to services currently being reviewed under the misvalued code initiative.

(a) Clinical Labor Tasks Associated With Digital Imaging

In PFS rulemaking for CY 2015, we noted that the RUC recommendation regarding inputs for digital imaging services indicated that, as each code is reviewed under the misvalued code initiative, the clinical labor tasks associated with digital technology (instead of film) would need to be addressed. When we reviewed that recommendation, we did not have the capability of assigning standard clinical labor times for the hundreds of individual codes since the direct PE input database did not previously allow for comprehensive adjustments for clinical labor times based on particular clinical labor tasks. Therefore, consistent with the recommendation, we proposed to remove film-based supply and equipment items but maintain clinical labor minutes that were assigned based on film technology.

As noted in the paragraphs above, we continue to improve the direct PE input database by specifying the minutes for each code associated with each clinical labor task. Once completed, this work would allow adjustments to be made to minutes assigned to particular clinical labor tasks related to digital technology, consistent with the changes that were made to individual supply and equipment items. In the meantime, we Start Printed Page 70901believe it would be appropriate to establish standard times for clinical labor tasks associated with all digital imaging for purposes of reviewing individual services at present, and for possible broad-based standardization once the changes to the database facilitate our ability to adjust time for existing services. Therefore, we solicited comments on the appropriate standard minutes for the clinical labor tasks associated with services that use digital technology, which are listed in Table 5. We note that the application of any standardized times we adopt for clinical labor tasks to codes that are not being reviewed in this final rule would be considered for possible inclusion in future notice and comment rulemaking.

Table 5—Clinical Labor Tasks Associated With Digital Technology

Clinical labor taskTypical minutes
Availability of prior images confirmed2
Patient clinical information and questionnaire reviewed by technologist, order from physician confirmed and exam protocoled by radiologist.2
Technologist QC's* images in PACS, checking for all images, reformats, and dose page.2
Review examination with interpreting MD2
Exam documents scanned into PACS. Exam completed in RIS system to generate billing process and to populate images into Radiologist work queue.1
* This clinical labor task is listed as it appears on the “PE worksheets.” QC refers to quality control, which we understand to mean the verification of the image using the PACS workstation.

The following is a summary of the comments we received regarding whether these standard times accurately reflect the typical time it takes to perform these clinical labor tasks associated with digital imaging.

Comment: Many commenters supported CMS' efforts to recognize the advances in digital technology and take them into account through updated RVUs. Several commenters agreed that the clinical labor tasks outlined in Table 5 reflected the PE Subcommittee's film to digital workgroup recommendations. The commenters suggested that the staff types in the tasks should be made more generalized and less specific (such as technologist to clinical staff or radiologist to physician), and stated that specialty societies should be afforded the opportunity to request deviations (that is, increases) from the standard times.

Response: We believe that providing specific guidelines for the staff types associated with these tasks will aid in determining the most accurate value for each service. We also agree that specialties should be afforded the opportunity to request deviations from the standard times for unusual situations, when supported with the presentation of additional justification for the added time.

Comment: The RUC commented that it had not supported standard times for clinical staff activities related to digital imaging in the past, as the RUC had recommended that the specialties should have an opportunity to determine the appropriate inputs at the individual distinct service level and there was too much variability across imaging modalities to propose standards. While the RUC continued to hold to its previous position on this subject, it also agreed that four of the five clinical labor activities proposed by CMS in Table 5 are representative across imaging and could appropriately be used as standard times. The one exception was the clinical labor task “Technologist QC's images in PACS, checking for all images, reformats, and dose page”, in which the RUC stated the number of minutes would vary significantly depending on the procedure in question. For example, a cardiac MR with hundreds of images would require more quality control time than a single view X-ray of the chest. The RUC recommended that this line item remain nonstandard, and that specialties should continue to have the opportunity to make a recommendation on the appropriate number of minutes based on clinical judgment.

Another commenter also supported standard clinical labor times for four out of the five tasks associated with digital technology, again excepting the activity “Technologist QC's images in PACS, checking for all images, reformats, and dose page.” This commenter stated that a survey of imaging providers had been conducted which suggested that the median time required to perform this clinical labor task was 10 minutes. The commenter stated that CMS did not have any data to support its belief in the standard time of 2 minutes, and recommended considering the commenter's data and information from other stakeholders regarding the appropriate standard minutes for the clinical labor tasks associated digital imaging.

Response: With regard to the activity “Technologist QC's images in PACS, checking for all images, reformats, and dose page”, we agree that this task may require a variable length of time depending on the number of images to be reviewed. We believe that it may be appropriate to establish several different standard times for this clinical labor task for a low/medium/high quantity of images to be reviewed, in the same fashion that the clinical labor assigned to clean a surgical instrument package has two different standard times depending on the use of a basic pack (10 minutes) or a medium pack (30 minutes). We are interested in soliciting public comment and feedback on this subject, with the anticipation of including a proposal in next year's proposed rule.

After consideration of comments received, we are finalizing standard times for clinical labor tasks associated with digital imaging at 2 minutes for “Availability of prior images confirmed”, 2 minutes for “Patient clinical information and questionnaire reviewed by technologist, order from physician confirmed and exam protocoled by radiologist”, 2 minutes for “Review examination with interpreting MD”, and 1 minute for “Exam documents scanned into PACS. Exam completed in RIS system to generate billing process and to populate images into Radiologist work queue.” We are not finalizing a standard time for clinical labor task “Technologist QC's images in PACS, checking for all images, reformats, and dose page” at this time, pending consideration of any additional public comment and future rulemaking, as described above.

(b) Pathology Clinical Labor Tasks

As with the clinical labor tasks associated with digital imaging, many of the specialized clinical labor tasks associated with pathology services do not have consistent times across those Start Printed Page 70902codes. In reviewing the recommendations for pathology services, we have not identified information that supports the judgment that the same tasks take significantly more or less time depending on the individual service for which they are performed, especially given the specificity with which they are described.

Therefore, we developed standard times that we have used in finalizing direct PE inputs. These times are based on our review and assessment of the current times included for these clinical labor tasks in the direct PE input database. We have listed these standard times in Table 6. For services reviewed for CY 2016, in cases where the RUC-recommended times differed from these standards, we have refined the time for those tasks to align with the values in Table 6. We solicited comments on whether these standard times accurately reflect the typical time it takes to perform these clinical labor tasks when furnishing pathology services.

Table 6—Standard Times for Clinical Labor Tasks Associated With Pathology Services

Clinical labor taskStandard clinical labor time (minutes)
Accession specimen/prepare for examination4
Assemble and deliver slides with paperwork to pathologists0.5
Assemble other light microscopy slides, open nerve biopsy slides, and clinical history, and present to pathologist to prepare clinical pathologic interpretation0.5
Assist pathologist with gross specimen examination3
Clean room/equipment following procedure (including any equipment maintenance that must be done after the procedure)1
Dispose of remaining specimens, spent chemicals/other consumables, and hazardous waste1
Enter patient data, computational prep for antibody testing, generate and apply bar codes to slides, and enter data for automated slide stainer1
Instrument start-up, quality control functions, calibration, centrifugation, maintaining specimen tracking, logs and labeling13
Load specimen into flow cytometer, run specimen, monitor data acquisition and data modeling, and unload flow cytometer7
Preparation: Labeling of blocks and containers and document location and processor used0.5
Prepare automated stainer with solutions and load microscopic slides4
Prepare specimen containers/preload fixative/label containers/distribute requisition form(s) to physician0.5
Prepare, pack and transport specimens and records for in-house storage and external storage (where applicable)1
Print out histograms, assemble materials with paperwork to pathologists. Review histograms and gating with pathologist2
Receive phone call from referring laboratory/facility with scheduled procedure to arrange special delivery of specimen procurement kit, including muscle biopsy clamp as needed. Review with sender instructions for preservation of specimen integrity and return arrangements. Contact courier and arrange delivery to referring laboratory/facility5
Register the patient in the information system, including all demographic and billing information4
Stain air dried slides with modified Wright stain. Review slides for malignancy/high cellularity (cross contamination)3

Comment: Many commenters stated that they did not support the standardization of clinical labor activities across pathology services. Commenters stated that a single standard time for each clinical labor task was infeasible due to the differences in batch size or number of blocks across different pathology procedures. Several commenters indicated that it may be possible to standardize across codes with the same batch sizes, and urged CMS to consider pathology-specific details, such as batch size and block number, in the creation of any future standard times for clinical labor tasks. One commenter stated that the CMS clinical labor times were uniformly too low, and that CMS did not provide enough information about how it arrived at these revised standard times. The commenter provided five examples of inadequate labor times, and stated that CMS should provide stakeholders with information about the source of its data and why it rejected the RUC recommendations for these clinical labor tasks.

Response: We appreciate the extensive feedback provided by commenters on the standard times for clinical labor tasks associated with pathology services. As we stated in the CY 2016 PFS proposed rule, we developed the proposed standard times based on our review and assessment of the current times included for these clinical labor tasks in the direct PE input database. We believe that clinical labor tasks with the same work description are comparable across different pathology procedures. We concur with commenters that accurate clinical labor times for pathology codes may be dependent on the number of blocks or batch size typically used for each individual service. However, we believe that it is possible to establish “per block” standards or standards varied by batch size assumptions for many clinical labor activities that will be comparable across a wide range of individual services. We have received detailed information regarding batch size and number of blocks during review of individual pathology services on an intermittent basis in the past. We request regular submission of these details on the PE worksheets as part of the review process for pathology procedures, as a means to assist in the determination of the most accurate direct PE inputs. Were we to receive this information as part of standard recommendations, we would include these assumptions as part of the information open for comment in proposed revaluations. We are also seeking comment regarding how to best establish clinical labor standards for pathology services on a “per block” or “per batch size” basis.

We also believe that many of the clinical labor activities that we discussed in Table 6 are tasks that do not depend on number of blocks or batch size. Clinical labor activities such as “Clean room/equipment following procedure” and “Dispose of remaining specimens” would typically remain standard across different services without varying by block number or batch size, with the understanding of occasional allowance for additional time for clinical labor tasks of unusual difficulty.

After consideration of comments received, we are finalizing standard times for clinical labor tasks associated with pathology services at 4 minutes for Start Printed Page 70903“Accession specimen/prepare for examination”, 0.5 minutes for “Assemble and deliver slides with paperwork to pathologists”, 0.5 minutes for “Assemble other light microscopy slides, open nerve biopsy slides, and clinical history, and present to pathologist to prepare clinical pathologic interpretation”, 1 minute for “Clean room/equipment following procedure”, 1 minute for “Dispose of remaining specimens, spent chemicals/other consumables, and hazardous waste”, and 1 minute for “Prepare, pack and transport specimens and records for in-house storage and external storage (where applicable).” We do not believe these activities would be dependent on number of blocks or batch size, and we believe that these values accurately reflect the typical time it takes to perform these clinical labor tasks. For the rest of the clinical labor tasks associated with pathology services, we are interested in soliciting further public comment and feedback on this subject as part of this final rule with comment period, with the anticipation of including a proposal in next year's proposed rule.

(c) Clinical Labor Task: “Complete Botox Log”

In the process of improving the level of detail in the direct PE input database by including the minutes assigned for each clinical labor task, we noticed that there are several codes with minutes assigned for the clinical labor task called “complete botox log.” We do not believe the completion of such a log is a direct resource cost of furnishing a medically reasonable and necessary physician's service for a Medicare beneficiary. Therefore, we proposed to eliminate the minutes assigned for the task “complete botox log” from the direct PE input database. The PE RVUs displayed in Addendum B on the CMS Web site were calculated with the modified inputs displayed in the CY 2016 direct PE input database.

The following is a summary of the comments we received regarding the clinical labor task “complete botox log.”

Comment: Several commenters, including the RUC, did not agree with the proposal to eliminate the minutes associated with this clinical labor task. Commenters maintained that the clinical labor task of completing the botox log was a medically reasonable direct resource cost. One commenter stated that it was critical for clinical staff to maintain accurate bookkeeping of split botox vials, and that documentation must reflect the exact dosage of the drug given to patients and a statement that the unused portion of the drug was discarded.

Response: We continue to believe that the clinical labor assigned for the task “complete botox log” is a form of indirect PE that is not allocated to individual services. We believe that this is a quality control issue for clinical staff. Maintaining accurate administrative records, even for public safety, is not a task we generally allocate to individual services, instead we consider these costs as attributable across a range of services, and therefore, as an indirect PE. After consideration of comments received, we are finalizing the proposal to eliminate the minutes assigned for the task “complete botox log” from the direct PE input database.

(3) Clinical Labor Input Inconsistencies

Subsequent to the publication of the CY 2015 PFS final rule with comment period, stakeholders alerted us to several clerical inconsistencies in the clinical labor nonfacility intraservice time for several vertebroplasty codes with interim final values for CY 2015, based on our understanding of RUC recommended values. We proposed to correct these inconsistencies in the CY 2016 proposed direct PE input database to reflect the RUC recommended values, without refinement, as stated in the CY 2015 PFS final rule with comment period. The CY 2015 interim final direct PE inputs for these codes are displayed on the CMS Web site under downloads for the CY 2015 PFS final rule with comment period at http://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​PhysicianFeeSched/​PFS-Federal-Regulation-Notices.html.

For CY 2016, we proposed the following adjustments:

  • For CPT codes 22510 (percutaneous vertebroplasty (bone biopsy included when performed), 1 vertebral body, unilateral or bilateral injection, inclusive of all imaging guidance; cervicothoracic) and 22511 (percutaneous vertebroplasty (bone biopsy included when performed), 1 vertebral body, unilateral or bilateral injection, inclusive of all imaging guidance; lumbosacral), a value of 45 minutes for labor code L041B (“Radiologic Technologist”) we proposed to assign for the “assist physician” task and a value of 5 minutes for labor code L037D (“RN/LPN/MTA”) for the “Check dressings & wound/home care instructions/coordinate office visits/prescriptions” task.
  • For CPT code 22514 (percutaneous vertebral augmentation, including cavity creation (fracture reduction and bone biopsy included when performed) using mechanical device (e.g., kyphoplasty), 1 vertebral body, unilateral or bilateral cannulation, inclusive of all imaging guidance; lumbar), we proposed to adjust the nonfacility intraservice time to 50 minutes for L041B, 50 minutes for L051A (“RN”), 38 minutes for a second L041B, and 12 minutes for L037D.

The PE RVUs displayed in Addendum B on the CMS Web site were calculated with the inputs displayed in the CY 2016 direct PE input database.

The following is a summary of the comments we received regarding clinical labor input inconsistencies.

Comment: Two commenters indicated that although they appreciated CMS' efforts to clean up errors in the direct PE database, they had specific concerns regarding the proposed changes. The commenters stated that for CPT code 22510, it appeared that the direct PE clinical time file had the second technologist listed at 90 minutes for the “Assist physician” task, not 45 minutes as recommended. The commenters indicated that CMS stated an intention to include 5 minutes for “Check dressings & wound” but this time did not appear to be included in the direct PE input labor file. The commenters also noted that the postoperative E/M visit for CPT code 22510 was also not listed in the CMS file.

The commenters stated that for CPT code 22511, the CMS direct PE labor file correctly included the 45 minutes of “Assist physician” time for the second technologist, however, the 5 minutes for the RN/LPN/MTA blend (L037D) to “Check dressings & wound” was still not included in the CMS file. The commenter indicated that the postoperative E/M visit was also not included for this code. The commenters also stated that for CPT code 22514, CMS was proposing to include the 5 minutes for “Check dressings & wound” in the intraservice time for this service. The commenters indicated that this did not appear to be consistent with how CMS was proposing to handle the same clinical labor task in the prior two codes discussed. The commenters requested that CMS outline specifically which line items (from the PE spreadsheet) it proposed to change and the effects these changes would have on the direct inputs for these three codes.

Response: We appreciate the detailed feedback from the commenters on the clinical labor inconsistencies in these three codes. We agree with the commenters that there were remaining clinical labor errors in these procedures beyond those detailed in the CY 2016 PFS proposed rule, and appreciate the opportunity to clarify the discrepancies Start Printed Page 70904in clinical labor for these three procedures.

For CPT code 22510, we agree with the commenters that the clinical labor assigned to the RadTech (L041B) for “Assist Physician” was incorrectly listed twice in our direct PE input database. The clinical labor staff type was also incorrectly entered as L041C, which is priced at the same rate but refers to a second Radiologic Technologist for Vertebroplasty. We will remove the duplicative clinical labor and assign type L041B to the “Assist Physician” activity. We do not agree with the commenters that the time for clinical labor task “Check dressings & wound” was missing, as it is present in the database. We agree with the commenters that the clinical labor time for the office visit was missing from CPT code 22510, and we will add it to the direct PE database.

For CPT code 22511, the commenters are correct that the time for clinical labor task “Assist physician” was entered at the correct value of 45 minutes, and the 5 minutes of clinical labor for “Check dressings & wound” does not appear in the non-facility setting. This clinical labor time appears to have been incorrectly entered for the facility setting instead; we will remove this time and add it to its proper non-facility setting. We agree with the commenters that the clinical labor time for the office visit was again missing from CPT code 22511, and we will add it to the direct PE input database.

For CPT code 22514, the time for clinical labor task “Assist physician” has been refined to 50 minutes as detailed in the CY 2016 PFS proposed rule. We agree with the commenters that the 5 minutes of clinical labor time for “Check dressings & wound” is missing from the direct PE input database. We agree that the clinical labor for this activity should not be treated differently from the rest of the codes in the family, and therefore these 5 minutes are included in the direct PE input database. The postoperative office visit is included in the direct PE input database for CPT code 22514.

After consideration of comments received, we are finalizing our proposed changes to clinical labor along with the additional corrections described above.

(4) Freezer

We identified several pathology codes for which equipment minutes are assigned to the item EP110 “Freezer.” Minutes are only allocated to particular equipment items when those items cannot be used in conjunction with furnishing services to another patient at the same time. We do not believe that minutes should be allocated to items such as freezers since the storage of any particular specimen or item in a freezer for any given period of time would be unlikely to make the freezer unavailable for storing other specimens or items. Instead, we proposed to classify the freezer as an indirect cost because we believe that would be most consistent with the principles underlying the PE methodology since freezers can be used for many specimens at once. The PE RVUs displayed in Addendum B on the CMS Web site were calculated with the modified inputs displayed in the CY 2016 direct PE input database.

We did not receive comments on this proposal, and therefore, we are finalizing as proposed.

(5) Updates to Price for Existing Direct Inputs

In the CY 2011 PFS final rule with comment period (75 FR 73205), we finalized a process to act on public requests to update equipment and supply price and equipment useful life inputs through annual rulemaking beginning with the CY 2012 PFS proposed rule. During 2014, we received a request to update the price of supply item “antigen, mite” (SH006) from $4.10 per test to $59. In reviewing the request, it is evident that the requested price update does not apply to the SH006 item but instead represents a different item than the one currently included as an input in CPT code 86490 (skin test, coccidioidomycosis). Therefore, rather than changing the price for SH006 that is included in several codes, we proposed to create a new supply code for Spherusol, valued at $590 per 1 ml vial and $59 per test, and to include this new item as a supply for 86490 instead of the current input, SH006.

Comment: Several commenters strongly supported the CMS proposal to create a new supply code for Spherusol that reflects the current price for the antigen and to update the direct inputs for CPT code 86490 to include this item. However, commenters noted that the public use files included in the CY 2016 PFS proposed rule continue to reflect the prior supply code SH006 with a price of $4.10. Commenters asked whether this was a technical error and urged CMS to correct the input files to be consistent with the proposal described in the regulation preamble.

Response: We appreciate support for our proposal and acknowledge our inadvertent omission of this change in the proposed direct PE input database. After consideration of comments received, we are finalizing our proposal to create a supply item for Spherusol and it is included as a direct PE input for CPT code 86490.

We also received a request to update the price for EQ340 (Patient Worn Telemetry System) used only in CPT code 93229 (External mobile cardiovascular telemetry with electrocardiographic recording, concurrent computerized real time data analysis and greater than 24 hours of accessible ECG data storage (retrievable with query) with ECG triggered and patient selected events transmitted to a remote attended surveillance center for up to 30 days; technical support for connection and patient instructions for use, attended surveillance, analysis and transmission of daily and emergent data reports as prescribed by a physician or other qualified health care.) The requestor noted that we had previously proposed and finalized a policy to remove wireless communication and delivery costs related to the equipment item that had previously been included in the direct PE input database as supply items. The requestor asked that we alter the price of the equipment from $21,575 to $23,537 to account for the equipment costs specific to the patient-worn telemetry system.

In the proposed rule, we stated that we considered this request in the context of the unique nature of this particular equipment item. This equipment item is unique in several ways, including that it is used continuously 24 hours per day and 7 days per week for an individual patient over several weeks. It is also unique in that the equipment is primarily used outside of a healthcare setting. Within our current methodology, we currently account for these unique properties by calculating the per minute costs with different assumptions than those used for most other equipment by increasing the number of hours the equipment is available for use. Therefore, we also believe it would be appropriate to incorporate other unique aspects of the operating costs of this item in our calculation of the equipment cost per minute. We believe the requestor's suggestion to do so by increasing the price of the equipment is practicable and appropriate. Therefore, we proposed to change the price for EQ340 (Patient Worn Telemetry System) to $23,537. The PE RVUs displayed in Addendum B on the CMS Web site were calculated with the modified inputs displayed in the CY 2016 direct PE input database.

Comment: One commenter supported the CMS proposal regarding the Patient Worn Telemetry System (EQ340). The commenter agreed with the proposed increase in the price of the equipment Start Printed Page 70905from $21,757 to $23,537, and the reason for this increase. We did not receive any comments opposing the proposal.

Response: After consideration of comments received, we are finalizing our proposal regarding the Patient Worn Telemetry System equipment.

For CY 2015, we received a request to update the price for supply item “kit, HER-2/neu DNA Probe” (SL196) from $105 to $144.50. Accordingly, in the CY 2015 proposed rule, we proposed to update the price to $144.50. In the CY 2015 final rule with comment period, we indicated that we obtained new information suggesting that further study of the price of this item was necessary before proceeding to update the input price. We obtained pricing information readily available on the Internet that indicated a price of $94 for this item for a particular hospital. Subsequent to the CY 2015 final rule with comment period, stakeholders requested that we use the updated price of $144.50. One stakeholder suggested that the price of $94 likely reflected discounts for volume purchases not received by the typical laboratory. We solicited comments on how to consider the higher-priced invoice, which is 53 percent higher than the price listed, relative to the price currently in the direct PE database. Specifically, we solicited information on the price of the disposable supply in the typical case of the service furnished to a Medicare beneficiary, including, based on data, whether the typical Medicare case is furnished by an entity likely to receive a volume discount.

Comment: Several commenters disagreed with the CMS proposal regarding the updated price for the supply item “kit, HER-2/neu DNA Probe” (SL196). One commenter stated that the price of $94 reflected a volume discount that could not be obtained by the typical provider. The lowered price referenced in the CY 2016 PFS proposed rule indicated that the purchaser may be receiving a competitive contractually arranged price. The commenter stated that the lowered price referenced is what might be expected to be acquired by the largest hospitals, which would be expected to buy supplies in greater volume than a small community hospital or mid-sized laboratory, and the price indicated does not reflect the prices for a laboratory of typical size.

Other commenters stated that they were unable to find this pricing information through publicly available sources, suggesting that it may not reflect typical transactions. The commenters also stated that it was unclear as to whether the proposed price referred to FDA-approved kits, which are more expensive than non-approved kits. The commenters further indicated that a number of new morphometric analysis, multiplex quantitative/semi-quantitative ISH tests are in use today with probe kit costs that are higher than those of HER-2/neu probe kits. The commenters suggested that CMS should adopt a weighted-average of the probe kit prices for the probe kits currently used to perform these procedures.

Response: Without robust, auditable information regarding the actual prices paid by a range of practitioners that would allow us to reasonably determine a recommended price to be typical, we believe that we should assume that the best publicly available price is typical. Generally speaking, we do not believe vendors are likely to allow public display of pricing that is not broadly available to potential customers since that would present significant competitive disadvantages in the market. Therefore, given the options between the best publicly available price or prices on invoices selected for the distinct purpose of pricing individual services, we believe the best publicly available price is more likely to be typical. Therefore, we are not making any changes to the price of this supply item at this time.

Comment: The RUC commented that in the CMS direct PE database the unit of measure for SL196 is listed as “kit”, while on the submitted PE spreadsheet the unit is listed as “kit assay.” The RUC recommended that the unit of measure be changed to “kit assay” to correlate correctly with the cost shown in the database.

Response: We appreciate this additional information, and will change the unit of measure of SL196 to “kit assay” in the direct PE database.

Comment: Several commenters stated CMS's estimated per-minute labor cost inputs are too low for laboratory technicians (L033A), cytotechnologists (L045A) and histotechnologists (L037B). The commenters stated that the complexity of many laboratory services demands highly-skilled, highly-trained, certified, and experienced personnel who typically must be paid higher wages than the current rates provided by CMS. Commenters stated that CMS has underestimated the actual labor costs associated with the work that these more specialized laboratory personnel perform by 20 to 30 percent, after accounting for costs related to benefits, taxes, and training.

Response: The clinical labor costs per minute are based on data from the Bureau of Labor Statistics. We believe that it is important to update that information uniformly among clinical labor types and will consider updating the clinical labor costs per minute in the direct PE database in future rulemaking.

(6) Typical Supply and Equipment Inputs for Pathology Services

In reviewing public comments in response to the CY 2015 PFS final rule with comment period, we re-examined issues around the typical number of pathology tests furnished at once. In the CY 2013 final rule with comment period (77 FR 69074), we noted that the number of blocks assumed for a particular code significantly impacts the assumed clinical labor, supplies, and equipment for that service. We indicated that we had concerns that the assumed number of blocks was inaccurate, and that we sought corroborating, independent evidence that the number of blocks assumed in the current direct PE input recommendations is typical. We note that, given the high volume of many pathology services, these assumptions have a significant impact on the PE RVUs for all other PFS services. We refer readers to section II.H. where we detail our concerns about the lack of information regarding typical batch size and typical block size for many pathology services and solicit stakeholder input on approaches to obtaining accurate information that can facilitate our establishing payment rates that best reflect the relative resources involved in furnishing the typical service, for both pathology services in particular and more broadly for services across the PFS.

Comment: Several commenters addressed the number of blocks and batch size for prostate biopsies in particular. We direct readers to section II.H. of this final rule with comment period for a more detailed discussion of the resource costs for these services. We continue to seek stakeholder input regarding the best sources of information for typical number of blocks and batch sizes for pathology services.

d. Developing Nonfacility Rates

We noted that not all PFS services are priced in the nonfacility setting, but as medical practice changes, we routinely develop nonfacility prices for particular services when they can be furnished outside of a facility setting. We noted that the valuation of a service under the PFS in particular settings does not address whether those services are medically reasonable and necessary in the case of individual patients, including being furnished in a setting appropriate to the patient's medical needs and condition.Start Printed Page 70906

(1) Request for Information on Nonfacility Cataract Surgery

Cataract surgery generally has been performed in an ambulatory surgery center (ASC) or a hospital outpatient department (HOPD). We have not assigned nonfacility PE RVUs under the PFS for cataract surgery. According to Medicare claims data, there are a relatively small number of these services furnished in nonfacility settings. Except in unusual circumstances, anesthesia for cataract surgery is either local or topical/intracameral. Advancements in technology have significantly reduced operating time and improved both the safety of the procedure and patient outcomes. As discussed in the proposed rule, we believe that it now may be possible for cataract surgery to be furnished in an in-office surgical suite, especially for routine cases. Cataract surgery patients require a sterile surgical suite with certain equipment and supplies that we believe could be a part of a nonfacility-based setting that is properly constructed and maintained for appropriate infection prevention and control.

We also noted in the proposed rule that we believe there are potential advantages for all parties to furnishing appropriate cataract surgery cases in the nonfacility setting. Cataract surgery has been for many years the highest volume surgical procedure performed on Medicare beneficiaries. For beneficiaries, cataract surgery in the office setting might provide the additional convenience of receiving the preoperative, operative, and post-operative care in one location. It might also reduce delays associated with registration, processing, and discharge protocols associated with some facilities. Similarly, it might provide surgeons with greater flexibility in scheduling patients at an appropriate site of service depending on the individual patient's needs. For example, routine cases in patients with no comorbidities could be performed in the nonfacility surgical suite, while more complicated cases (for example, pseudoexfoliation) could be scheduled in the ASC or HOPD. In addition, furnishing cataract surgery in the nonfacility setting could result in lower Medicare expenditures for cataract surgery if the nonfacility payment rate were lower than the sum of the PFS facility payment rate and the payment to either the ASC or HOPD.

We solicited comments from ophthalmologists and other stakeholders on office-based surgical suite cataract surgery. In addition, we solicited comments from the RUC and other stakeholders on the direct PE inputs involved in furnishing cataract surgery in the nonfacility setting in conjunction with our consideration of information regarding the possibility of development of nonfacility cataract surgery PE RVUs.

We received 138 comments from stakeholders including professional medical societies, the RUC, ambulatory surgical centers (ASCs), practitioners, and the general public. The RUC deferred to the specialty societies regarding the appropriateness of performing these services in the nonfacility setting.

Comment: A few commenters suggested that development of PE RVUs would allow for greater flexibility regarding scheduling and location where services are performed. Commenters provided information about clinical considerations related to furnishing these services in a nonfacility setting, with many commenters citing safety concerns involved in furnishing cataract surgery in the office setting.

Response: We will use this information as we consider whether to proceed with development of nonfacility PE RVUs for cataract surgery.

(2) Direct PE Inputs for Functional Endoscopic Sinus Surgery Services

A stakeholder indicated that due to changes in technology and technique, several codes that describe endoscopic sinus surgeries can now be furnished in the nonfacility setting. According to Medicare claims data, there are a relatively small number of these services furnished in nonfacility settings. These CPT codes are 31254 (Nasal/sinus endoscopy, surgical; with ethmoidectomy, partial (anterior)), 31255 (Nasal/sinus endoscopy, surgical; with ethmoidectomy, total (anterior and posterior)), 31256 (Nasal/sinus endoscopy, surgical, with maxillary antrostomy), 31267 (Nasal/sinus endoscopy, surgical, with maxillary antrostomy; with removal of tissue from maxillary sinus), 31276 (Nasal/sinus endoscopy, surgical with frontal sinus exploration, with or without removal of tissue from frontal sinus), 31287 (Nasal/sinus endoscopy, surgical, with sphenoidotomy), and 31288 (Nasal/sinus endoscopy, surgical, with sphenoidotomy; with removal of tissue from the sphenoid sinus). We solicited input from stakeholders, including the RUC, about the appropriate direct PE inputs for these services.

We received 53 comments from stakeholders including specialty societies, device manufacturers, medical centers, and physician practices (otolaryngology, allergy, facial, and plastics specialists).

Comment: The RUC indicated an intention to review direct PE inputs at the January 2016 RUC meeting. One specialty society representing otolaryngology head and neck surgeons indicated that endoscopic sinus surgery services have been identified by the CPT/RUC workgroup for development of bundled codes for this code family and inputs will likely be reviewed as part of this process. Some commenters submitted information about their respective PEs related to CPT codes 31254, 31255, 31267, 31276, 31287, and 31288. Other commenters limited their comments to CPT codes 31254 and 31255, noting clinical concerns about performance of other sinus surgery procedures in the nonfacility setting. A few commenters did not support development of nonfacility direct PE RVUs for endoscopic sinus surgery due to clinical considerations such as patient safety, possible complications, use of anesthesia, and need for establishment of standards and oversight of in-office surgical suites.

Response: We appreciate the feedback we received from all commenters. We will use this information as we consider whether to proceed with development of nonfacility PE RVUs or functional endoscopic sinus surgery services.

B. Determination of Malpractice Relative Value Units (RVUs)

1. Overview

Section 1848(c) of the Act requires that each service paid under the PFS be composed of three components: Work, PE, and malpractice (MP) expense. As required by section 1848(c)(2)(C)(iii) of the Act, beginning in CY 2000, MP RVUs are resource based. Malpractice RVUs for new codes after 1991 were extrapolated from similar existing codes or as a percentage of the corresponding work RVU. Section 1848(c)(2)(B)(i) of the Act also requires that we review, and if necessary adjust, RVUs no less often than every 5 years. In the CY 2015 PFS final rule with comment period, we implemented the third review and update of MP RVUs. For a discussion of the third review and update of MP RVUs see the CY 2015 proposed rule (79 FR 40349 through 40355) and final rule with comment period (79 FR 67591 through 67596).

As explained in the CY 2011 PFS final rule with comment period (75 FR 73208), MP RVUs for new and revised codes effective before the next five-year review of MP RVUs were determined either by a direct crosswalk from a similar source code or by a modified Start Printed Page 70907crosswalk 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 MP RVU for the new/revised code to reflect the difference in work RVU between the source code and the new/revised work RVU (or, if greater, the clinical labor portion of the fully implemented 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 MP RVU for the revised code would be increased by 10 percent over the source code MP RVU. Under this approach the same risk factor is applied for the new/revised code and source code, but the work RVU for the new/revised code is used to adjust the MP RVUs for risk.

For CY 2016, we proposed to continue our current approach for determining MP RVUs for new/revised codes. For the new and revised codes for which we proposed work RVUs and PE inputs, we also published the proposed MP crosswalks used to determine their MP RVUs. The MP crosswalks for those new and revised codes were subject to public comment and we are responding to comments and finalizing them in section II.H. of this CY 2016 PFS final rule with comment period. The MP crosswalks for new and revised codes with interim final values established in this CY 2016 final rule with comment period will be implemented for CY 2016 and subject to public comment. We will then respond to comments and finalize them in the CY 2017 PFS final rule with comment period.

2. Proposed Annual Update of MP RVUs

In the CY 2012 PFS final rule with comment period (76 FR 73057), we finalized a process to consolidate the five-year reviews of work and PE RVUs with our annual review of potentially misvalued codes. We discussed the exclusion of MP RVUs from this process at the time, and we stated that, since it is not feasible to obtain updated specialty level MP insurance premium data on an annual basis, we believe the comprehensive review of MP RVUs should continue to occur at 5-year intervals. In the CY 2015 PFS proposed rule (79 FR 40349 through 40355), we stated that there are two main aspects to the update of MP RVUs: (1) Recalculation of specialty risk factors based upon updated premium data; and (2) recalculation of service level RVUs based upon the mix of practitioners providing the service. In the CY 2015 PFS final rule with comment period (79 FR 67596), in response to several stakeholders' comments, we stated that we would address potential changes regarding the frequency of MP RVU updates in a future proposed rule. For CY 2016, we proposed to begin conducting annual MP RVU updates to reflect changes in the mix of practitioners providing services, and to adjust MP RVUs for risk. Under this approach, the specialty-specific risk factors would continue to be updated every 5 years using updated premium data, but would remain unchanged between the 5-year reviews. However, in an effort to ensure that MP RVUs are as current as possible, our proposal would involve recalibrating all MP RVUs on an annual basis to reflect the specialty mix based on updated Medicare claims data. Since under this proposal, we would be recalculating the MP RVUs annually, we also proposed to maintain the relative pool of MP RVUs from year to year; this will preserve the relative weight of MP RVUs to work and PE RVUs. We proposed to calculate the current pool of MP RVUs by using a process parallel to the one we use in calculating the pool of PE RVUs. (We direct the reader to section II.2.b.(6) for detailed description of that process, including a proposed technical revision that we are finalizing for 2016.) To determine the specialty mix assigned to each code, we also proposed to use the same process used in the PE methodology, described in section II.2.b.(6) of this final rule with comment period. We note that for CY 2016, we proposed and are finalizing a policy to modify the specialty mix assignment methodology to use an average of the 3 most recent years of available data instead of a single year of data. We anticipate that this change will increase the stability of PE and MP RVUs and mitigate code-level fluctuations for all services paid under the PFS, and for new and low-volume codes in particular. We also proposed to no longer apply the dominant specialty for low volume services, because the primary rationale for the policy has been mitigated by this proposed change in methodology. However, we did not propose to adjust the code-specific overrides established in prior rulemaking for codes where the claims data are inconsistent with a specialty that could be reasonably expected to furnish the service. We believe that these proposed changes serve to balance the advantages of using annually updated information with the need for year-to-year stability in values. We solicited comments on both aspects of the proposal: Updating the specialty mix for MP RVUs annually (while continuing to update specialty-specific risk factors every 5 years using updated premium data); and using the same process to determine the specialty mix assigned to each code as is used in the PE methodology, including the proposed modification to use the most recent 3 years of claims data. We also solicited comments on whether this approach will be helpful in addressing some of the concerns regarding the calculation of MP RVUs for services with low volume in the Medicare population, including the possibility of limiting our use of code-specific overrides of the claims data.

The following is a summary of the comments we received regarding our current approach for determining malpractice RVUs for new/revised codes.

Comment: Several commenters, including the RUC, generally supported CMS' proposal to update the MP RVUs on an annual basis. Commenters, including the RUC, stated a preference for the annual collection of professional liability insurance (PLI) premium data to insure the MP RVUs for every service is accurate, as opposed to only collecting these data every five years.

Response: We appreciate commenters' support of our proposal to update the MP RVUs on an annual basis. We also appreciate the comments from stakeholders regarding the frequency that we currently collect premium data. We will continue to consider the appropriate frequency for doing so, and we would address any potential changes in future rulemaking.

Comment: Commenters, including the RUC, support CMS's proposal to use the 3 most recent years of available data for the specialty mix assignment.

Response: We appreciate the commenters' support.

Comment: Commenters supported CMS' proposal to maintain the code-specific overrides established in previous rulemaking for codes where the claims data are inconsistent with a specialty that could be reasonably expected to furnish the service. Commenters also requested that CMS publish the list of overrides annually to receive stakeholder feedback related to necessary modification to the list, and in an effort to be as transparent as possible.

Response: We appreciate the comments and agree that we should increase the transparency regarding the list of services with MP RVU overrides. Publication of this list will also allow commenters to alert us to any discrepancies between MP RVUs developed annually under the new methodology and previously established overrides. Therefore, we have posted a public use file containing the overrides. Start Printed Page 70908The file is available on the CMS Web site under the supporting data files for the CY 2016 PFS final rule at http://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​PhysicianFeeSched/​index.html.

Comment: One commenter stated that CMS should be particularly mindful of using the specialty mix in the Medicare claims data for services with low Medicare volume but high volume in the United States health care system more generally, such as pediatric procedures; and that CMS' MP RVU methodology needs to differentiate between services that are truly low volume and those that occur frequently, but not among Medicare beneficiaries.

Response: We believe that the list of overrides we are making available as a public use file on the CMS Web site will help address the commenter's concern since the purpose of the code-specific overrides is to address circumstances where the claims data are inconsistent with the specialty that could be reasonably expected to furnish the service. We have previously accepted comment on services like those identified by the commenter and will continue to consider comments regarding the need to use overrides for particular services, especially for high volume services outside the Medicare population.

Comment: One commenter requested that CMS continue to use the dominant specialty for low volume codes.

Response: We acknowledge the concern about using the dominant specialty for low volume codes, and will continue to monitor the resulting RVUs to determine if adjustments become necessary. In general, we believe the 3-year average mitigates the need to apply the dominant specialty for low volume services. However, we have a long history of applying the dominant specialty for low volume services in instances where the specialty indicated by the claims data is inconsistent with the specialty that could be reasonably expected to furnish the service, and we are maintaining that practice.

Comment: Some commenters requested more information on how specialty impacts were determined. Two commenters expressed concerns about the estimated impact of the several proposed changes in the MP methodology on some specialties—particularly gastroenterology, colon and rectal surgery, and neurosurgery. Those commenters state that they appreciate the assertion that it may be difficult to obtain premium data for some specialties, such as neurosurgery, and state that CMS must thoroughly vet the methodology used by its contractor to determine MP premiums for such specialties. The commenters urge CMS to review the data, continue to try to obtain premium data in as many states as possible, and to share the data with the public for the agency and specialties to determine its accuracy.

Response: Specialty impacts are determined by comparing the estimated overall payment for each specialty that would result from the proposed RVUs and policies to the estimated overall payment for each specialty under the current year RVUs and policies, using the most recent year of available claims data as a constant. We note that for MP RVUs, there were several refinements that resulted in minor impacts to particular specialties, especially those at the higher end of specialty risk factors. We believe that these impacts are consistent with the general tendency of greater change in MP RVUs for specialties with risk factors of greater magnitude. We agree with the commenters regarding of the importance of making certain that the collection of premium data and the methodology of calculating MP RVUs are as accurate as possible. This is the reason we continue to examine the methodology and develop technical improvements such as the ones described in this section of the final rule. Additionally, we believe that annual calibration of MP RVUs will be likely to reduce the risk of irregularities, since we will regularly compare MP RVUs for individual codes and for specialties between consecutive years instead of only comparing MP RVUs update years.

After consideration of the public comments received, we are finalizing the policies as proposed. That is, we are finalizing the proposal to conduct annual MP RVU updates to reflect changes in the mix of practitioners providing services and to adjust MP RVUs for risk, and to modify the specialty mix assignment methodology to use an average of the 3 most recent years of available data instead of a single year. We note that we will continue to maintain the code-specific overrides where the claims data are inconsistent with a specialty that would reasonable be expected to furnish the services.

We also proposed an additional refinement in our process for assigning MP RVUs to individual codes. Historically, we have used a floor of 0.01 MP RVUs for all nationally-priced PFS codes. This means that even when the code-level calculation for the MP RVU falls below 0.005, we have rounded to 0.01. In general, we believe this approach accounts for the minimum MP costs associated with each service furnished to a Medicare beneficiary. However, in examining the calculation of MP RVUs, we do not believe that this floor should apply to add-on codes. Since add-on codes must be reported with another code, there is already an MP floor of 0.01 that applies to the base code, and therefore, to each individual service. By applying the floor to add-on codes, the current methodology practically creates a 0.02 floor for any service reported with one add-on code, and 0.03 for those with 2 add-on codes, etc. Therefore, we proposed to maintain the 0.01 MP RVU floor for all nationally-priced PFS services that are described by base codes, but not for add-on codes. We will continue to calculate, display, and make payments that include MP RVUs for add-on codes that are calculated to 0.01 or greater, including those that round to 0.01. We only proposed to allow the MP RVUs for add-on codes to round to 0.00 where the calculated MP RVU is less than 0.005.

Comment: Several commenters, including the RUC, opposed CMS' proposal to remove the MP RVU floor of 0.01 for add-on services. These commenters suggested that the incremental risk associated with performing an additional procedure is not mitigated by the risk inherent in the base procedure. Another commenter stated that each service should be considered separately for the purposes of calculating MP RVUs, and therefore, each service should be given the 0.01 floor regardless of base or add-on status.

Response: We appreciate commenters' feedback, but note that we do not believe the comments respond to the rationale for the proposed refinement. We agree that the incremental risk in procedures described by add-on codes is not mitigated by the risk inherent in the base procedure. That is why we did not propose to eliminate MP RVUs for add-on codes generally. Instead, we believe that when the incremental risk is calculated to be a number closer to 0.00 than 0.01, we do not believe that rounding such a number to 0.01 accurately reflects the risk of the service that is described by two codes (base code and add-on) relative to the risks associated with other PFS services. We continue to believe that this refinement is the most appropriate approach, since we would continue to account for the incremental risk associated with add-on codes without overestimating the risk in circumstances where the MP RVU falls below 0.005. Therefore, we are finalizing the policy as proposed.Start Printed Page 70909

3. MP RVU Update for Anesthesia Services

In the CY 2015 PFS proposed rule (79 FR 40354 through 40355), we did not include an adjustment under the anesthesia fee schedule to reflect updated MP premium information, and stated that we intended to propose an anesthesia adjustment for MP in the CY 2016 PFS proposed rule. We also solicited comments regarding how to best reflect updated MP premium amounts under the anesthesiology fee schedule.

As we previously explained, anesthesia services under the PFS are paid based upon a separate fee schedule, so routine updates must be calculated in a different way than those for services for which payment is calculated based upon work, PE, and MP RVUs. To apply budget neutrality and relativity updates to the anesthesiology fee schedule, we typically develop proxy RVUs for individual anesthesia services that are derived from the total portion of PFS payments made through the anesthesia fee schedule. We then update the proxy RVUs as we would the RVUs for other PFS services and adjust the anesthesia fee schedule conversion factor based on the differences between the original proxy RVUs and those adjusted for relativity and budget neutrality.

We believe that taking the same approach to update the anesthesia fee schedule based on new MP premium data is appropriate. However, because work RVUs are integral to the MP RVU methodology and anesthesia services do not have work RVUs, we decided to seek potential alternatives prior to implementing our approach in conjunction with the proposed CY 2015 MP RVUs based on updated premium data. One commenter supported the delay in proposing to update the MP for anesthesia at the same time as updating the rest of the PFS, and another commenter suggested using mean anesthesia MP premiums per provider over a 4- or 5-year period prorated by Medicare utilization to yield the MP expense for anesthesia services; no commenters offered alternatives to calculating updated MP for anesthesia services. The latter suggestion might apply more broadly to the MP methodology for the PFS and does not address the methodology as much as the data source.

We continue to believe that payment rates for anesthesia should reflect MP resource costs relative to the rest of the PFS, including updates to reflect changes over time. Therefore, for CY 2016, to appropriately update the MP resource costs for anesthesia, we proposed to make adjustments to the anesthesia conversion factor to reflect the updated premium information collected for the 5 year review. To determine the appropriate adjustment, we calculated imputed work RVUs and MP RVUs for the anesthesiology fee schedule services using the work, PE, and MP shares of the anesthesia fee schedule. Again, this is consistent with our longstanding approach to making annual adjustments to the PE and work RVU portions of the anesthesiology fee schedule. To reflect differences in the complexity and risk among the anesthesia fee schedule services, we multiplied the service-specific risk factor for each anesthesia fee schedule service by the CY 2016 imputed proxy work RVUs and used the product as the updated raw proxy MP RVUs for each anesthesia service for CY 2016. We then applied the same scaling adjustments to these raw proxy MP RVUs that we apply to the remainder of the PFS MP RVUs. Finally, we calculated the aggregate difference between the 2015 proxy MP RVUs and the proxy MP RVUs calculated for CY 2016. We then adjusted the portion of the anesthesia conversion factor attributable to MP proportionately; we refer the reader to section VI.C. of this final rule with comment period for the Anesthesia Fee Schedule Conversion Factors for CY 2016. We invited public comments regarding this proposal.

The following is a summary of the comments we received regarding this proposal.

Comment: We received few comments with regard to our proposal; commenters expressed appreciation that CMS recognized the unique aspects involved in updating the MP component associated with anesthesia services, and therefore, delayed the anesthesia MP update until the CY 2016 PFS.

Response: We appreciate the commenters' feedback, and we are finalizing the policy as proposed.

4. MP RVU Methodology Refinements

In the CY 2015 PFS final rule with comment period (79 FR 67591 through 67596), we finalized updated MP RVUs that were calculated based on updated MP premium data obtained from state insurance rate filings. The methodology used in calculating the finalized CY 2015 review and update of resource-based MP RVUs largely paralleled the process used in the CY 2010 update. We posted our contractor's report, “Final Report on the CY 2015 Update of Malpractice RVUs” on the CMS Web site. It is also located under the supporting documents section of the CY 2015 PFS final rule with comment period located at http://www.cms.gov/​PhysicianFeeSched/​. A more detailed explanation of the 2015 MP RVU update can be found in the CY 2015 PFS proposed rule (79 FR 40349 through 40355).

In the CY 2015 PFS proposed rule, we outlined the steps for calculating MP RVUs. In the process of calculating MP RVUs for purposes of the CY 2016 PFS proposed rule, we identified a necessary refinement to way we calculated Step 1, which involves computing a preliminary national average premium for each specialty, to align the calculations within the methodology to the calculations described within the aforementioned contractor's report. Specifically, in the calculation of the national premium for each specialty (refer to equations 2.3, 2.4, 2.5 in the aforementioned contractor's report), we calculate a weighted sum of premiums across areas and divide it by a weighted sum of MP GPCIs across areas. The calculation currently takes the ratio of sums, rather than the weighted average of the local premiums to the MP GPCI in that area. Instead, we proposed to update the calculation to use a price-adjusted premium (that is, the premium divided by the GPCI) in each area, and then taking a weighted average of those adjusted premiums. The CY 2016 PFS proposed rule MP RVUs were calculated in this manner.

Additionally, in the calculation of the national average premium for each specialty as discussed above, our current methodology used the total RVUs in each area as the weight in the numerator (that is, for premiums), and total MP RVUs as the weights in the denominator (that is, for the MP GPCIs). After further consideration, we believe that the use of these RVU weights is problematic. Use of weights that are central to the process at hand presents potential circularity since both weights incorporate MP RVUs as part of the computation to calculate MP RVUs. The use of different weights for the numerator and denominator introduces potential inconsistency. Instead, we believe that it would be better to use a different measure that is independent of MP RVUs and better represents the reason for weighting. Specifically, we proposed to use area population as a share of total U.S. population as the weight. The premium data are for all MP premium costs, not just those associated with Medicare patients, so we believe that the distribution of the population does a better job of capturing the role of each area's premium in the “national” premium for each specialty than our previous Medicare-specific measure. Start Printed Page 70910Use of population weights also avoids the potential problems of circularity and inconsistency.

The CY 2016 PFS final MP RVUs, as displayed in Addendum B of this final rule with comment period, reflect MP RVUs calculated following our established methodology, with the inclusion of the proposals and refinements described above.

Comment: Commenters generally supported the technical changes to the MP RVU methodology and found them reasonable. One commenter stated that such refinements will increase stability of MP RVUs and does a better role of capturing the role of each local area's premium in the “national” premium for each specialty.

Response: We appreciate the commenters' support, and we are finalizing the policy as proposed.

Comment: One commenter stated that the MP RVU for cataract and other ophthalmic surgeries is deflated significantly because CMS assumes that optometry is providing the actual surgical portion of the procedure, when there is no state that allows optometrists to perform cataract surgery or any other major ophthalmic procedure. The commenter states that the clinical reality is that optometry is involved only during the pre- or post- procedure time period, and CMS should not allow optometric utilization of those codes with co-management modifiers to be included in the calculations for any major ophthalmic surgical procedures. The commenter suggested that if CMS does not agree to remove optometry from the calculation of MP RVUs for ophthalmic surgery, that CMS should use a much lower percentage of utilization to accurately reflect the true risk that optometrists encounter during this limited portion of the service. The commenter also disagreed that all providers who pay for malpractice insurance should have their premiums taken into consideration, and stated that when CMS looks at the dominant specialty for a given service, it must ensure that the claims reported—particularly by non-physician providers such as optometrists, are for the surgical portion of the procedure for which the MP RVU is being considered.

Response: We would clarify for the commenter that we apply the risk factor(s) of all specialties involved with furnishing services to calculate the service level risk factors for all PFS codes. Our methodology already accounts for codes with longer global periods or codes where two different practitioners report different parts of the service, weighing the volume differentially among the kinds of practitioners that report the service depending on which portion of the service each reports. We also remind commenters that, to determine the raw MP RVU for a given service, we consider the greater of the work RVU or clinical labor RVU for the service. Since the time and intensity of the pre-service and post-service period are incorporated into the work RVUs for these services and the work RVUs are used in the development of MP RVUs, we believe it is methodologically consistent to incorporate the portion of the overall services that is furnished by practitioners other than those that furnish the procedure itself in the calculation of MP RVUs. If we were to exclude the risk factors of some specialties that bill a specific code from the calculation of the service level risk factor, the resulting MP RVU would not reflect all utilization. Likewise, we also disagree with the suggestion that the pre- and post- utilization should be removed from determining MP RVUs for ophthalmic surgical services. The resources associated with pre- and post-operative periods for ophthalmic surgery are included in the total RVUs for the global surgical package. Accordingly, if we did not include the portion of utilization attributed to pre- and post-operative visits in the calculation of service level risk factors, the MP RVUs for global surgery would overstate the relative MP costs.

Comment: One commenter identified three low volume codes typically performed by cardiac surgery or thoracic surgery that have anomalous MP RVU values: CPT code 31766 (carinal reconstruction), the commenter requested that the MP risk factor associated with Thoracic surgery be assigned; CPT Code 33420 (valvotomy, mitral valve; closed heart), the commenter requests that the MP risk factor associated with Cardiac Surgery be assigned; and for 32654 (thorascoscopy, surgical; with control of traumatic hemorrhage), the commenter requests that the MP risk factor associated with Thoracic surgery be assigned.

Response: We agree with the commenters and have added these services to the list of those with specialty overrides for CY 2016. We hope to identify such anomalies more regularly in the future now that the public use file listing the overrides is available on the CMS Web site as indicated above.

5. CY 2016 Identification of Potentially Misvalued Services for Review

a. Public Nomination of Potentially Misvalued Codes

In the CY 2012 PFS final rule with comment period, we finalized a process for the public to nominate potentially misvalued codes (76 FR 73058). Members of the public including direct 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. Supporting documentation for codes nominated for the annual review of potentially misvalued codes may include, but is not limited to, the following:

  • Documentation in the peer reviewed medical literature or other reliable data that there have been changes in work due to one or more of the following: Technique; knowledge and technology; patient population; site-of-service; length of hospital stay; and work time.
  • An anomalous relationship between the code being proposed for review and other codes.
  • Evidence that technology has changed 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 work 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 work 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 Start Printed Page 70911appear 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.

During the comment periods for the CY 2015 proposed rule and final rule with comment period, we received nominations and supporting documentation for three codes to be considered as potentially misvalued codes. We evaluated the supporting documentation for each nominated code to ascertain whether the submitted information demonstrated that the code should be proposed as potentially misvalued.

CPT code 36516 (Therapeutic apheresis; with extracorporeal selective adsorption or selective filtration and plasma reinfusion) was nominated for review as potentially misvalued. The nominator stated that CPT code 36516 is misvalued because of incorrect direct and indirect PE inputs and an incorrect work RVU. Specifically, the nominator stated that the direct supply costs failed to include an $18 disposable bag and the $37 cost for biohazard waste disposal of the post-treatment bag, and that the labor costs for nursing staff were inaccurate. The nominator also stated that the overhead expenses associated with this service were unrealistic and that the current work RVU undervalues a physician's time and expertise. Based on the requestor's comment, we proposed this code as a potentially misvalued code. We also noted that we established a policy in CY 2011 to consider biohazard bags as an indirect expense, and not as a direct PE input (75 FR 73192).

Comment: Several commenters stated that they do not believe CPT code 36516 is potentially misvalued because they found no indication that the clinical staff time, indirect expenses, or work was misvalued. All commenters requested that this code be removed from the potentially misvalued list.

Response: We appreciate the comments, but we believe that the nominator presented some concerns that may have merit, and review of the code is the best way to determine the validity of the concerns articulated by the original requestor. Therefore, we are adding CPT code 36516 to the list of potentially misvalued codes and anticipate reviewing recommendations from the RUC and other stakeholders.

CPT Codes 52441 (Cystourethroscopy with insertion of permanent adjustable transprostatic implant; single implant) and 52442 (Cystourethroscopy with insertion of permanent adjustable transprostatic implant; each additional permanent adjustable transprostatic implant) were nominated for review as potentially misvalued. The nominator stated that the costs of the direct PE inputs were inaccurate, including the cost of the implant. We proposed these services as potentially misvalued codes.

Comment: Some commenters disagreed that the commenter intended to nominate CPT codes 52441 and 52442 as potentially misvalued.

Response: After reviewing the original comment, we agree with these commenters' perspective that the intention was not to nominate the codes as potentially misvalued. Therefore, we are not finalizing our proposal to review these codes under the potentially misvalued code initiative.

b. Electronic Analysis of Implanted Neurostimulator (CPT Codes 95970-95982)

In the CY 2015 final rule with comment period (79 FR 67670), we reviewed and valued all of the inputs for the following CPT codes: 95971 (Electronic analysis of implanted neurostimulator pulse generator system (e.g., rate, pulse amplitude, pulse duration, configuration of wave form, battery status, electrode selectability, output modulation, cycling, impedance and patient compliance measurements); simple spinal cord, or peripheral (i.e., peripheral nerve, sacral nerve, neuromuscular) neurostimulator pulse generator/transmitter, with intraoperative or subsequent programming); 95972 (Electronic analysis of implanted neurostimulator pulse generator system (e.g., rate, pulse amplitude, pulse duration, configuration of wave form, battery status, electrode selectability, output modulation, cycling, impedance and patient compliance measurements); complex spinal cord, or peripheral (i.e., peripheral nerve, sacral nerve, neuromuscular) (except cranial nerve) neurostimulator pulse generator/transmitter, with intraoperative or subsequent programming, up to one hour); and 95973 (Electronic analysis of implanted neurostimulator pulse generator system (e.g., rate, pulse amplitude, pulse duration, configuration of wave form, battery status, electrode selectability, output modulation, cycling, impedance and patient compliance measurements); complex spinal cord, or peripheral (i.e., peripheral nerve, sacral nerve, neuromuscular) (except cranial nerve) neurostimulator pulse generator/transmitter, with intraoperative or subsequent programming, each additional 30 minutes after first hour (List separately in addition to code for primary procedure)). Due to significant time changes in the base codes, we believe the entire family detailed in Table 7 is potentially misvalued and should be reviewed in a manner consistent with our review of CPT codes 95971, 95972 and 95973.

Table 7—Potentially Misvalued Codes Identified in the Electronic Analysis of Implanted Neurostimulator Family

HCPCSShort descriptor
95970Analyze neurostim no prog.
95974Cranial neurostim complex.
95975Cranial neurostim complex.
95978Analyze neurostim brain/1h.
95979Analyz neurostim brain addon.
95980Io anal gast n-stim init.
95981Io anal gast n-stim subsq.
95982Io ga n-stim subsq w/reprog.

Comment: One commenter agreed with the review of CPT codes 95970-95982 as potentially misvalued services.

Response: We are adding CPT codes 95970-95982 to the list of potentially misvalued codes and anticipate reviewing recommendations from the AMA RUC and other stakeholders.Start Printed Page 70912

c. Review of High Expenditure Services Across Specialties With Medicare Allowed Charges of $10,000,000 or More

In the CY 2015 PFS rule, we proposed and finalized the high expenditure screen as a tool to identify potentially misvalued codes in the statutory category of “codes that account for the majority of spending under the PFS.” We also identified codes through this screen and proposed them as potentially misvalued in the CY 2015 PFS proposed rule (79 FR 40337-40338). However, given the resources required for the revaluation of codes with 10- and 90-day global periods, we did not finalize those codes as potentially misvalued codes in the CY 2015 PFS final rule with comment period. We stated that we would re-run the high expenditure screen at a future date, and subsequently propose the specific set of codes that meet the high expenditure criteria as potentially misvalued codes (79 FR 67578).

As detailed in the CY 2016 PFS proposed rule (80 FR 41706), we believed that our current resources will not necessitate further delay in proceeding with the high expenditure screen for CY 2016. Therefore, we re-ran the screen with the same criteria finalized in last year's final rule. However, in developing this CY 2016 proposed list, we also excluded all codes with 10- and 90-day global periods since we believe these codes should be reviewed as part of the global surgery revaluation described in section II.B.6. of this final rule with comment period.

We proposed 118 codes as potentially misvalued codes, identified using the high expenditure screen under the statutory category, “codes that account for the majority of spending under the PFS.” To develop the list, we followed the same approach taken last year except we excluded codes with 10- and 90-day global periods. Specifically, we identified the top 20 codes by specialty (using the specialties used in Table 64 in terms of allowed charges. As we did last year, we excluded codes that we have reviewed since CY 2010, those with fewer than $10 million in allowed charges, and those that described anesthesia or E/M services. We excluded E/M services from the list of proposed potentially misvalued codes for the same reasons that we excluded them in a similar review in CY 2012. These reasons were explained in the CY 2012 final rule with comment period (76 FR 73062 through 73065).

Comment: Some commenters did not believe that high expenditure/high volume was an appropriate criterion for us to use to identify the codes for the potentially misvalued codes initiative. These commenters stated that high expenditure is not an objective gauge of potential misvaluation. Additionally, commenters believed that selecting codes that have not been reviewed in the past 5 years insinuates that the delivery of these services and procedures has changed radically over that time span, which many doubted. Other commenters believed CMS should provide justification for the revaluation by providing evidence and/or data to show how the delivery of a service or procedure has changed within 5 years. While many disagreed with our use of the high expenditure screen, some commenters specifically suggested use of different types of screens; some of which would screen for services for which volume has increased a certain percentage over a set period or screen for changes in the predominate site of service.

Response: We appreciate commenters' perspective on the proposed list of potentially misvalued codes based on the high expenditure screen. It is clear that over time the resources involved in furnishing particular services can often change and, therefore, many services that have not recently been evaluated may become potentially misvalued. Under section 1848(c)(2)(B) of the Act, we are mandated to review relative values for codes for all physicians' services at least every 5 years. The purpose of specifically identifying potentially misvalued codes through particular screens established through rulemaking is to prioritize the review of individual codes since comprehensive, annual review of all codes for physicians' services is not practical and, due to the need to maintain relativity, changes in values for individual services can have an impact across the PFS. We identify potentially misvalued codes in order to prioritize review of subsets of PFS services. We prioritize review of individual services based on indications that a particular code is likely to be misvalued and on the impact that the potential misvaluation of the code would have on the valuation of PFS services broadly. Our high expenditure screen is largely intended to address the latter situation where improved valuation would have the most significant impact on the valuation of PFS services more broadly. This approach is also consistent with another category of codes identified for screening by statute: Codes with high PE relative value units. In proposing to prioritize this list of high expenditure codes, we stated that the reason we identified these codes is because they have significant impact on PFS payment on a specialty level and have not been recently reviewed.

Comment: A few commenters suggested that E/M services should not be exempt from review as potentially misvalued codes.

Response: In the CY 2012 final rule (76 FR 73063), we explained the concerns expressed by commenters that informed our decision to refrain from finalizing our proposal to review 91 E/M codes as potentially misvalued. We believe that those concerns remain valid. We also believe that it is best to exempt E/M codes from our review of potentially misvalued codes since we are continuously exploring valuations of E/M services, potential refinements to the PFS, and other options for policies that may contribute to improved valuation of E/M services.

Comment: Many commenters also stated that the review of codes over such a short time span puts significant burden on the specialty societies. Many commenters agreed that high expenditure codes should be reviewed on a periodic basis over multiple years. Some commenters specifically suggested that the periodic basis should be 10 years while others suggested delaying any review of the codes until after the misvalued code target has been met.

Response: Because of the concerns expressed by commenters about the burden associated with code reviews, we continue to believe that it is appropriate to prioritize review of codes to a manageable subset that also have a high impact on the PFS and work with the specialty society to spread review of the remaining codes identified as potentially misvalued over a reasonable timeframe. Therefore, we do not believe it would be appropriate to remove codes from the high expenditure list unless we find that we have reviewed both the work RVUs and direct PE inputs for the code during the specified time period.

Also, we believe that the resources involved in furnishing a service can evolve over time, including the time and technology used to furnish the service, and such efficiencies could easily develop in a time span as short as 5 years. As a result, we continue to believe that the review of these high expenditure codes is necessary to ensure that the services are appropriately valued. Additionally, not only do we believe that regular monitoring of codes with high impact on the PFS will produce a more accurate and equitable payment system, but we have a statutory obligation under Start Printed Page 70913section 1848(c)(2)(B) of the Act to review code values at least every 5 years (although we do not always conduct a review that involves the AMA RUC). Therefore, we do not agree with the commenter that suggested that changes in technology and practice can be effectively accounted for through review of code values every 10 years.

Comment: Commenters stated that the following codes were reviewed since CY 2010 and, as a result, do not fit the criteria for the high expenditure screen and should be removed: CPT codes 51728 (Insertion of electronic device into bladder with voiding pressure studies), 51729 (Insertion of electronic device into bladder with voiding and bladder canal (urethra) pressure studies), 76536 (Ultrasound of head and neck), 78452 (Nuclear medicine study of vessels of heart using drugs or exercise multiple studies), 92557 (Air and bone conduction assessment of hearing loss and speech recognition), 92567 (Eardrum testing using ear probe), 93350 (Ultrasound examination of the heart performed during rest, exercise, and/or drug-induced stress with interpretation and report) and 94010 (Measurement and graphic recording of total and timed exhaled air capacity).

Response: We agree with commenters that the codes identified do not fit the criteria for review based on the high expenditure screen. Therefore, we are not proposing to review CPT codes 51728, 51729, 76536, 78452, 92557, 92567, 93350, and 94010 under the potentially misvalued code initiative.

Comment: Commenters believed that services that are add-ons to the excluded 10- and 90-day global services should be removed from the list of codes identified through the high expenditure screen in order to maintain relativity. The specific codes suggested for removal were: CPT codes 22614 (Fusion of spine bones, posterior or posterolateral approach); 22840 (Insertion of posterior spinal instrumentation at base of neck for stabilization, 1 interspace); 22842 (Insertion of posterior spinal instrumentation for spinal stabilization, 3 to 6 vertebral segments); 22845 (Insertion of anterior spinal instrumentation for spinal stabilization, 2 to 3 vertebral segments); and 33518 (Combined multiple vein and artery heart artery bypasses).

Response: We agree with the commenters that the codes identified should be removed from the list of codes identified for review through the high expenditure screen due to their relationship to the 10- and 90-day global services that were excluded from our screen. Although we agree that these codes should be removed from this screen, we think it is worthwhile to note that for similar reasons, we believe we should consider these and similar add-on codes in conjunction with efforts to improve the valuation and the global surgery packages as described in section II.B.6. of this final rule with comment period. Therefore, we are not including CPT codes 22614, 22840, 22842, 22845 on the list of codes identified for review through the high expenditure screen.

Comment: Commenters believed that CPT code 92002 (Eye and medical examination for diagnosis and treatment, new patient) is considered an ophthalmological evaluation and management (E/M) service and as a result, should be excluded for all the same reasons we excluded other E/M codes.

Response: We agree with commenters that CPT code 92002 is considered an E/M and, as a result, should be excluded from the screen as were other E/Ms. Therefore, we are not including CPT code 92002 on the list of codes identified for review through the high expenditure screen.

Comment: A few commenters requested that codes with a work RVU equal to 0.00 (CPT codes 51798 (Ultrasound measurement of bladder capacity after voiding), 88185 (Flow cytometry technique for DNA or cell analysis), 93296 (Remote evaluations of single, dual, or multiple lead pacemaker or cardioverter-defibrillator transmissions, technician review, support, and distribution of results up to 90 days), 96567 (Application of light to aid destruction of premalignant and/or malignant skin growths, each session), and 96910 (Skin application of tar and ultraviolet B or petrolatum and ultraviolet B)) or equal to 0.01 (CPT codes 95004 (Injection of allergenic extracts into skin, accessed through the skin)) be removed from the list of codes identified for review through the high expenditure screen. Commenters stated that historically, services with 0.00 work RVUs were excluded from screens and that re-reviewing a service with a 0.01 work RVU would most likely not lower the work component unless work was completely removed from the code.

Response: We continue to believe that codes with 0.00 work RVUs or very low work RVUs of 0.01, should still be reviewed and can still be considered potentially misvalued. As stated earlier, we do not believe it would be appropriate to remove codes from the high expenditure list unless we find that we have reviewed both the work RVUs and direct PE inputs. Therefore, we are maintaining CPT codes 51798, 88185, 93296, 96567, 96910 and 95004 as potentially misvalued codes and anticipate reviewing recommendations from the AMA RUC and other stakeholders.

Comment: Various commenters objected to the presence of individual codes that met the high expenditure screen criteria based on absence of clinical evidence that the individual services are misvalued.

Response: We reviewed each of these comments, and believe that these kinds of assessments are best addressed through the misvalued code review process. As we describe in this section, the criteria for many misvalued code screens, including this one, are designed to prioritize codes that may be misvalued not to identify codes that are misvalued. Therefore, we believe that supporting evidence for the accuracy of current values for particular codes is best considered as part of the review of individual codes through the misvalued code process.

Comment: Several commenters believed that codes that are currently scheduled to be considered by either the CPT Editorial Panel for new coding or the RUC for revised valuations (for work RVUs and/or PE inputs) at an upcoming meeting should be removed from the screen. Commenters also believed that it was best to allow these codes to go through the RUC code review process rather than identifying the codes as potentially misvalued through this screen.

Response: Although a number of codes have been or will be considered through the RUC review process, until we receive recommendations and review the codes for both work and direct PE inputs, we will continue to include these codes on the high expenditure list. We reiterate that we do not believe that the presence of a code on a misvalued code list signals that a particular code necessarily is misvalued. Instead, the lists are intended to prioritize codes to be reviewed under the misvalued code initiative. If any code on the list finalized here is already being reviewed by the RUC through its process, we will receive a recommendation regarding valuation for the code, and the presence or absence of the code in this particular list is immaterial. However, if subsequent to the removal of a code from the high expenditure code list, the RUC decides not to review the code, we would still want to consider the code as potentially misvalued based on its meeting the criteria established for the screen. Therefore, we do not agree that we should remove individual codes from a potentially misvalued code list because the RUC already anticipates Start Printed Page 70914reviewing the code. However, we want to be clear that when we receive RUC recommendations regarding a code, we generally remove that code from misvalued code lists, regardless of whether or not the RUC reviewed the code on the basis of that particular screen.

Accordingly, we are finalizing the 103 codes in Table 8 as potentially misvalued services under the high expenditure screen and seek recommended values for these codes from the RUC and other interested stakeholders.

Table 8—List of Potentially Misvalued Codes Identified Through High Expenditure by Specialty Screen

HCPCSShort descriptor
10022Fna w/image.
11100Biopsy skin lesion.
11101Biopsy skin add-on.
11730Removal of nail plate.
20550Inj tendon sheath/ligament.
20552Inj trigger point 1/2 muscl.
20553Inject trigger points 3/>.
27370Injection for knee x-ray.
29580Application of paste boot.
31500Insert emergency airway.
31575Diagnostic laryngoscopy.
31579Diagnostic laryngoscopy.
31600Incision of windpipe.
36215Place catheter in artery.
36556Insert non-tunnel cv cath.
36569Insert picc cath.
36620Insertion catheter artery.
38221Bone marrow biopsy.
51700Irrigation of bladder.
51702Insert temp bladder cath.
51720Treatment of bladder lesion.
51784Anal/urinary muscle study.
51798Us urine capacity measure.
52000Cystoscopy.
55700Biopsy of prostate.
58558Hysteroscopy biopsy.
67820Revise eyelashes.
70491Ct soft tissue neck w/dye.
70543Mri orbt/fac/nck w/o & w/dye.
70544Mr angiography head w/o dye.
70549Mr angiograph neck w/o & w/dye.
71010Chest x-ray 1 view frontal.
71020Chest x-ray 2vw frontal&latl.
71260Ct thorax w/dye.
71270Ct thorax w/o & w/dye.
72195Mri pelvis w/o dye.
72197Mri pelvis w/o & w/dye.
73110X-ray exam of wrist.
73130X-ray exam of hand.
73718Mri lower extremity w/o dye.
73720Mri lwr extremity w/o & w/dye.
74000X-ray exam of abdomen.
74022X-ray exam series abdomen.
74181Mri abdomen w/o dye.
74183Mri abdomen w/o & w/dye.
75635Ct angio abdominal arteries.
75710Artery x-rays arm/leg.
75978Repair venous blockage.
76512Ophth us b w/non-quant a.
76519Echo exam of eye.
77059Mri both breasts.
77263Radiation therapy planning.
77334Radiation treatment aid(s).
77470Special radiation treatment.
78306Bone imaging whole body.
88185Flowcytometry/tc add-on.
88189Flowcytometry/read 16 & >.
88321Microslide consultation.
88360Tumor immunohistochem/manual.
88361Tumor immunohistochem/comput.
91110Gi tract capsule endoscopy.
92136Ophthalmic biometry.
92240Icg angiography.
92250Eye exam with photos.
92275Electroretinography.
93280Pm device progr eval dual.
93288Pm device eval in person.
93293Pm phone r-strip device eval.
93294Pm device interrogate remote.
93295Dev interrog remote 1/2/mlt.
93296Pm/icd remote tech serv.
93306Tte w/doppler complete.
93351Stress tte complete.
93503Insert/place heart catheter.
93613Electrophys map 3d add-on.
93965Extremity study.
94620Pulmonary stress test/simple.
95004Percut allergy skin tests.
95165Antigen therapy services.
95957Eeg digital analysis.
96101Psycho testing by psych/phys.
96116Neurobehavioral status exam.
96118Neuropsych tst by psych/phys.
96360Hydration iv infusion init.
96372Ther/proph/diag inj sc/im.
96374Ther/proph/diag inj iv push.
96375Tx/pro/dx inj new drug addon.
96401Chemo anti-neopl sq/im.
96402Chemo hormon antineopl sq/im.
96409Chemo iv push sngl drug.
96411Chemo iv push addl drug.
96567Photodynamic tx skin.
96910Photochemotherapy with uv-b.
97032Electrical stimulation.
97035Ultrasound therapy.
97110Therapeutic exercises.
97112Neuromuscular reeducation.
97113Aquatic therapy/exercises.
97116Gait training therapy.
97140Manual therapy 1/regions.
97530Therapeutic activities.
97535Self care mngment training.
G0283Elec stim other than wound.

6. Valuing Services That Include Moderate Sedation as an Inherent Part of Furnishing the Procedure

The CPT manual includes more than 400 diagnostic and therapeutic procedures, listed in Appendix G, for which the CPT Editorial Committee has determined that moderate sedation is an inherent part of furnishing the procedure. For these diagnostic and therapeutic procedures, only the procedure code is reported by the practitioner who conducts the procedure, without separate billing by the same practitioner for anesthesia services, and, in developing RVUs for these services, we include the resource costs associated with moderate sedation in the valuation. To the extent that moderate sedation is inherent in the diagnostic or therapeutic service, we believe that the inclusion of moderate sedation in the valuation of the procedure is appropriate. In the CY 2015 PFS proposed rule (79 FR 40349), we noted that it appeared practice patterns for endoscopic procedures were changing, with anesthesia increasingly being separately reported for these procedures. Due to the changing nature of medical practice, we noted that we were considering establishing a uniform approach to valuation for all Appendix G services. We continue to seek an approach that is based on using the best available objective, broad-based information about the provision of moderate sedation, rather than merely addressing this issue on a code-by-code basis using RUC survey data when individual procedures are revalued. We sought public comment on approaches to address the appropriate valuation of these services given that moderate sedation is no longer inherent for many of these services. To the extent that Appendix G procedure code values are adjusted to no longer include moderate sedation, we requested suggestions as to how moderate sedation should be reported and valued, and how to remove from existing valuations the RVUs and inputs related to moderate sedation.

To establish an approach to valuation for all Appendix G services based on the best data about the provision of moderate sedation, we need to determine the extent to which each code may be misvalued. We know that there are standard packages for the direct PE inputs associated with moderate sedation, and we began to develop approaches to estimate how much of the work involved in these services is attributable to moderate sedation. However, we believe that we should seek input from the medical community prior to proposing changes in values for these services, given the different methodologies used to develop work RVUs for the hundreds of services in Appendix G. Therefore, in the CY 2016 PFS proposed rule, we solicited recommendations from the RUC and other interested stakeholders on the appropriate valuation of the work associated with moderate sedation before formally proposing an approach that allows Medicare to adjust payments based on the resource costs associated with the moderate sedation or anesthesia services that are being furnished.

The anesthesia procedure codes 00740 (Anesthesia for procedure on gastrointestinal tract using an endoscope) and 00810 (Anesthesia for procedure on lower intestine using an endoscope) are used for anesthesia furnished in conjunction with lower GI Start Printed Page 70915procedures. In reviewing Medicare claims data, we noted that a separate anesthesia service is now reported more than 50 percent of the time that several types of colonoscopy procedures are reported. Given the significant change in the relative frequency with which anesthesia codes are reported with colonoscopy services, we believe the relative values of the anesthesia services should be re-examined. Therefore, in the CY 2016 PFS proposed rule, we proposed to identify CPT codes 00740 and 00810 as potentially misvalued. We welcomed comments on both of these issues.

Comment: Several commenters noted that they support CMS' decision to seek input from the medical community prior to proposing a method for reporting and valuing moderate sedation as well as adjusting existing valuations to remove these services. One commenter also encouraged CMS to seek and consider recommendations from societies that represent members who provide dialysis vascular access interventional care, such as the American Society of Diagnostic and Interventional Nephrology.

Response: We thank the commenters for their support. Through notice and comment rulemaking, we will review and consider any recommendations from the public, including those from any interested specialty societies.

Comment: In response to CMS' proposal to identify anesthesia procedure codes 00740 and 00810 as potentially misvalued, the RUC stated that the committee anticipated reviewing CPT codes 00740 and 00810 as potentially misvalued codes.

Response: We appreciate the RUC's responsiveness to the proposal.

Comment: One commenter disagreed that the increase in utilization of anesthesia is indicative of potential misvaluation of the codes in Appendix G. This commenter noted that the policy adopted by CMS in the CY 2015 final rule to eliminate cost-sharing for anesthesia furnished in conjunction with screening colonoscopies encourages patients to undergo these screenings. The commenter also noted that use of anesthesia with upper endoscopy procedures not only decreases patient discomfort, but also decreases complications and creates more optimal conditions for efficiency during the procedure as well as reduced recovery time as compared to the use of narcotics and sedative hypnotic agents. The commenter believes that this results in savings that offset the costs of anesthesia services. The commenter also expressed the view that the work involved in these services has not changed.

Response: We thank the commenters for their input. Since the pool of beneficiaries that receive anesthesia in conjunction with these Appendix G services has grown, we believe it is possible that the typical circumstances under which patients receive these services have changed since the services were last reviewed. Therefore, we continue to seek recommendations regarding appropriate approaches to valuation for these services.

Comment: A few commenters noted that there are a variety of services in Appendix G and stated their view that practitioners who furnish services for which there are claims data supporting the inherent nature of moderate sedation should not have to report moderate sedation separately, as they believe they would be faced with administrative burden and costs. They recommended that CMS conduct ongoing analysis of claims data to determine which codes may require unbundling of moderate sedation and to refer only those codes as potentially misvalued. One commenter noted that they opposed the use of any “blanket approach” to valuing moderate sedation such as removing the standard packages for the direct PE inputs associated with moderate sedation. The commenter recommended instead that we look at codes by family or specialty in order to ensure that reimbursements are fair and accurate. One commenter also noted the difference in the work involved with moderate sedation when it is furnished by the same physician who is furnishing the procedure compared with when it is furnished by another clinician, and requested that this be considered when valuing the moderate sedation services. Another commenter suggested that CMS create a modifier to be used by surgeons providing moderate sedation. They also suggested that CMS consider the expenses involved with using a registered nurse or CRNA, the medications and delivery systems, patient monitoring equipment, and lengthened postoperative recovery period when valuing moderate sedation services.

Response: We thank the commenters for their input. We will consider input from the medical community on this issue through evaluation of CPT coding changes and associated RUC recommendations, as well as feedback received through public comments, as we value these services through future notice and comment rulemaking.

7. Improving the Valuation and Coding of the Global Package

a. Proposed Transition of 10-Day and 90-Day Global Packages Into 0-Day Global Packages

In the CY 2015 PFS final rule (79 FR 67582 through 67591) we finalized a policy to transition all 10-day and 90-day global codes to 0-day global periods in order to improve the accuracy of valuation and payment for the various components of global surgical packages, including pre- and postoperative visits and the surgical procedure itself. Although in previous rulemaking we have marginally addressed some of the concerns we identified with global packages, we believe there is still a need to address other fundamental issues with the 10- and 90-day postoperative global packages. We believe it is critical that the RVUs we use to develop PFS payment rates reflect the most accurate resource costs associated with PFS services. We believe that valuing global codes that package services together without objective, auditable data on the resource costs associated with the components of the services contained in the packages may significantly skew relativity and create unwarranted payment disparities within PFS fee-for-service payment. We also believe that the resource-based valuation of individual physicians' services will continue to serve as a critical foundation for Medicare payment to physicians. Therefore, we believe it is critical that the RVUs under the PFS be based as closely and accurately as possible on the actual resources involved in furnishing the typical occurrence of specific services.

In the rulemaking for CY 2015, we stated our belief that transforming all 10- and 90-day global codes to 0-day global codes would:

  • Increase the accuracy of PFS payment by setting payment rates for individual services based more closely upon the typical resources used in furnishing the procedures;
  • Avoid potentially duplicative or unwarranted payments when a beneficiary receives postoperative care from a different practitioner during the global period;
  • Eliminate disparities between the payment for E/M services in global periods and those furnished individually;
  • Maintain the same-day packaging of pre- and postoperative physicians' services in the 0-day global code; and
  • Facilitate availability of more accurate data for new payment models and quality research.Start Printed Page 70916

b. Impact of the Medicare Access and CHIP Reauthorization Act of 2015

The MACRA was enacted into law on April 16, 2015. Section 523 of the MACRA addresses payment for global surgical packages. Section 523(a) adds a new paragraph at section 1848(c)(8) of the Act. Section 1848(c)(8)(A)(i) of the Act prohibits the Secretary from implementing the policy established in the CY 2015 PFS final rule with comment period that would have transitioned all 10-day and 90-day global surgery packages to 0-day global periods. Section 1848(c)(8)(A)(ii) of the Act provides that nothing in the previous clause shall be construed to prevent the Secretary from revaluing misvalued codes for specific surgical services or assigning values to new or revised codes for surgical services.

Section 1848(c)(8)(B)(i) of the Act requires CMS to develop, through rulemaking, a process to gather information needed to value surgical services from a representative sample of physicians, and requires that the data collection shall begin no later than January 1, 2017. The collected information must include the number and level of medical visits furnished during the global period and other items and services related to the surgery, as appropriate. This information must be reported on claims at the end of the global period or in another manner specified by the Secretary. Section 1848(c)(8)(B)(ii) of the Act requires that, every 4 years, we must reassess the value of this collected information; and allows us to discontinue the collection if the Secretary determines that we have adequate information from other sources in order to accurately value global surgical services. Section 1848(c)(8)(B)(iii) of the Act specifies that the Inspector General will audit a sample of the collected information to verify its accuracy. Section 1848(c)(8)(C) of the Act requires that, beginning in CY 2019, we must use the information collected as appropriate, along with other available data, to improve the accuracy of valuation of surgical services under the PFS. Section 523(b) of the MACRA adds a new paragraph at section 1848(c)(9) of the Act that authorizes the Secretary, through rulemaking, to delay up to 5 percent of the PFS payment for services for which a physician is required to report information under section 1848(c)(8)(B)(i) of the Act until the required information is reported.

Since section 1848(c)(8)(B)(i) of the Act, as added by section 523(a) of the MACRA, requires us to use rulemaking to develop and implement the process to gather information needed to value surgical services no later than January 1, 2017, we sought input from stakeholders on various aspects of this task. We solicited comments from the public regarding the kinds of auditable, objective data (including the number and type of visits and other services furnished by the practitioner reporting the procedure code during the current postoperative periods) needed to increase the accuracy of the values for surgical services. We also solicited comment on the most efficient means of acquiring these data as accurately and efficiently as possible. For example, we sought information on the extent to which individual practitioners or practices may currently maintain their own data on services, including those furnished during the postoperative period, and how we might collect and objectively evaluate those data for use in increasing the accuracy of the values beginning in CY 2019.

We received many comments regarding the kinds of auditable, objective data needed to increase the accuracy of the values for surgical services and the most efficient means of acquiring these data. Commenters had several suggestions for the approach that CMS should take, including the following:

  • Collect and examine large group practice data for CPT code 99024 (postoperative follow-up visit).
  • Review Medicare Part A claims data to determine the length of stay of surgical services performed in the hospital facility setting.
  • Prioritize services that the Agency has identified as high concern subjects.
  • Review postoperative visit and length of stay data for outliers.

In general, commenters were supportive of the need to identify auditable, objective, representative data, but many were not able to identify a specific source for such data. We appreciate the comments we received and we will consider these suggestions for purposes of future rulemaking.

As noted above, section 1848(c)(8)(C) of the Act mandates that we use the collected data to improve the accuracy of valuation of surgery services beginning in 2019. We described in previous rulemaking (79 FR 67582 through 67591) the limitations and difficulties involved in the appropriate valuation of the global packages, especially when the values of the component services are not clear. We sought public comment on potential methods of valuing the individual components of the global surgical package, including the procedure itself, and the pre- and postoperative care, including the follow-up care during postoperative days. We were also interested in stakeholder input on what other items and services related to the surgery, aside from postoperative visits, are furnished to beneficiaries during postoperative care.

We received many comments regarding potential methods of valuing the individual components of the global surgical package, including the following:

  • Use a measured approach to valuing the individual components of the global surgical package rather than implementing a blanket data collection policy.
  • Examine and consider the level of the postoperative E/M visits, including differences between specialties.
  • Consider the interaction between the valuing the global surgery package and the multiple procedure payment reduction (MPPR) policy.

We will consider these comments regarding the best means to develop and implement the process to gather information needed to value surgical services and will provide further opportunity for public comment through future rulemaking.

Comment: We received many comments expressing strong support for the CMS proposal to hold an open door forum or town hall meetings with the public.

Response: We appreciate the extensive comments we received from the public regarding the global surgical package. We have noted the positive feedback from commenters about holding potential open forums or town hall meetings to discuss this process. We will consider these comments regarding the best means to develop and implement the process to gather information needed to value surgical services as we develop proposals for inclusion in next year's PFS proposed rule.

C. Elimination of the Refinement Panel

1. Background

As discussed in the CY 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 RVUs for the subsequent year. We decided the panel would be composed 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 Start Printed Page 70917multispecialty 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.

Following enactment of section 1848(c)(2)(K) of the Act, which required the Secretary periodically to identify and 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 continued using the established refinement panel process with some modifications.

For CY 2015, in light of the changes we made to the process for valuing new, revised, and potentially misvalued codes (79 FR 67606), we reassessed the role that the refinement panel process plays in the code valuation process. We noted that the current refinement panel process is tied to the review of interim final values. It provides an opportunity for stakeholders to provide new clinical information that was not available at the time of the RUC valuation that might affect work RVU values that are adopted in the interim final value process. For CY 2015 interim final rates, we stated in the CY 2015 PFS final rule with comment period that we will use the refinement panel process as usual for these codes (79 FR 67609).

2. CY 2016 Refinement Panel Proposal

We proposed to permanently eliminate the refinement panel beginning in CY 2016, and instead, publish the proposed rates for all interim final codes in the PFS proposed rule for the subsequent year. For example, we would publish the proposed rates for all CY 2016 interim final codes in the CY 2017 PFS proposed rule. With the change in the process for valuing codes adopted in the CY 2015 final rule with comment period (79 FR 67606), proposed values for most codes that are being valued for CY 2016 were published in the CY 2016 PFS proposed rule. As explained in the CY 2015 final rule with comment period, a smaller number of codes being valued for CY 2016 will be published as interim final in the 2016 PFS final rule with comment period and be subject to comment. Under our proposal, we will evaluate the comments we receive on these code values, and both respond to these comments and propose values for these codes for CY 2017 in the CY 2017 PFS proposed rule. Therefore, stakeholders will have two opportunities to comment and to provide any new clinical information that was not available at the time of the RUC valuation that might affect work RVU values that are adopted on an interim final basis. We believe that this proposed process, which includes two opportunities for public notice and comment, offers stakeholders a better mechanism and ample opportunity for providing any additional data for our consideration, and discussing any concerns with our interim final values, than the current refinement process. It also provides greater transparency because comments on our rules are made available to the public at http://www.regulations.gov. We welcomed comments on this proposed change to eliminate the use of refinement panels in our process for establishing final values for interim final codes.

The following is a summary of the comments we received on this proposed change to eliminate the use of refinement panels in our process for establishing final values for interim final codes.

Comment: The majority of commenters, including the American Medical Association/Specialty Society Relative (Value) Update Committee, opposed the proposal to eliminate the refinement panel. Commenters expressed concern that the complete elimination of the refinement process decreases CMS's accountability to its stakeholders who do not agree with the Agency's decisions. They urged CMS to provide detailed guidance on how to seek a change in previously finalized RVUs including the process to initiate a meeting with CMS staff to share and discuss new information or clarify previously shared information, as well as any key timelines or dates that may impact CMS's ability to initiate a change in previously finalized RVUs. Commenters also urged CMS to maintain a transparent appeal process. Another stated that, as CY 2017 will be the first full year using the new process for establishing final values for interim final codes, it is possible that unforeseen needs for the continuation of the refinement panel could arise.

Several commenters agreed with the proposal to eliminate the refinement panel. One commenter supported the permanent elimination of the refinement panel since CMS's display of interim final values in the subsequent year's proposed rule will provide another opportunity for public input. Another believed the new process will provide more timely input on the codes and stated that publishing interim final values for these in the proposed rule versus the final rule should allow adequate time for public comment and for physicians to prepare for changes that would have an impact on their practices and patients. Another commenter welcomed the increased opportunity to review and comment on interim values, especially given that CMS has not been obligated to accept recommendations of the refinement panels and has frequently rejected those recommendations.

Response: We appreciate all of the comments on the proposal. We understand that commenters have an interest in a transparent process to review CMS's assignment of RVUs to individual PFS services. We also understand that some commenters believe that the purpose of the refinement panel process is to provide for reconsideration of the agency's previous decisions. However, the refinement panel was established to assist us in reviewing the public comments on CPT codes with interim final work RVUs and in balancing 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. Therefore, we do not believe that the refinement panel has generally served as the kind of “appeals” or reconsideration process that some stakeholders envision in their comments. We also have come to believe that the refinement panel is not achieving its intended purpose. Rather than providing us with additional information, balanced across specialty interests, to assist us in establishing work RVUs, the refinement panel process generally serves to rehash the issues raised and information already discussed at the RUC meetings and considered by CMS.

We also appreciate commenters' interest in CMS maintaining a transparent process with public accountability in establishing values for physicians' services. In contrast to the prior process of establishing interim final values and using a refinement panel process that generally is not observed by members of the public, we believe that the new process of proposing the majority of code values in the proposed rule and making sure that those proposed values are open for comment prior to their taking effect for payment inherently represents greater transparency and accountability. We will also continue to work towards greater transparency in describing in rulemaking how we develop our proposed values for individual codes. We believe that focusing our resources on notice and comment rulemaking would facilitate greater transparency.Start Printed Page 70918

Given that the timing for valuation of PFS services under the new process will in large part mitigate the need to establish values on an interim final basis and will provide two opportunities for notice and public comment, we do not believe that the refinement panel would necessarily provide value as an avenue for input, for either CMS or stakeholders, beyond that intrinsic in the notice and comment rulemaking process. However, we appreciate commenters' concerns that the new process has not been fully implemented and there may be unanticipated needs for additional input like the kind made available through the refinement panels. We agree that it may be advisable to preserve existing avenues for public input beyond the rulemaking process, like the refinement panel.

Therefore, after consideration of all of the comments and the issues described in this section, we are not finalizing our proposal to eliminate the refinement panel process at this time. Instead, we will retain the ability to convene refinement panels for codes with interim final values under circumstances where additional input provided by the panel is likely to add value as a supplement to notice and comment rulemaking. We will make the determination on whether to convene refinement panels on an annual basis, based on review of comments received on interim final values. We remind stakeholders that CY 2016 is the final year for which we anticipate establishing interim final values for existing services.

We also want to remind stakeholders that we have established an annual process for the public nomination of potentially misvalued codes. This process, described in the CY 2012 PFS final rule (76 FR 73058), provides an annual means for those who believe that values for individual services are inaccurate and should be readdressed through notice and comment rulemaking to bring those codes to our attention.

D. Improving Payment Accuracy for Primary Care and Care Management Services

In the CY 2016 PFS proposed rule, we sought public comment on a number of issues regarding payment for primary care and care coordination under the PFS. We are committed to supporting primary care, and we have increasingly recognized care management as one of the critical components of primary care that contributes to better health for individuals and reduced expenditure growth (77 FR 68978). Accordingly, we have prioritized the development and implementation of a series of initiatives designed to improve the accuracy of payment for, and encourage long-term investment in, care management services.

In addition to the Medicare Shared Savings Program, various demonstration initiatives including the Pioneer Accountable Care Organization (ACO) model, the patient-centered medical home model in the Multi-payer Advanced Primary Care Practice (MAPCP), the Federally Qualified Health Center (FQHC) Advanced Primary Care Practice demonstration and the Comprehensive Primary Care (CPC) initiative, among others (see the CY 2015 PFS final rule (79 FR 67715) for a discussion of these), we also have continued to explore potential refinements to the PFS that would appropriately value care management within Medicare's statutory structure for fee-for-service physician payment and quality reporting. The payment for some non-face-to-face care management services is bundled into the payment for face-to-face evaluation and management (E/M) visits. However, because the current E/M office/outpatient visit CPT codes were designed with an overall orientation toward episodic treatment, we have recognized that these E/M codes may not reflect all the services and resources involved with furnishing certain kinds of care, particularly comprehensive, coordinated care management for certain categories of beneficiaries.

Over several years, we have developed proposals and sought stakeholder input regarding potential PFS refinements to improve the accuracy of payment for care management services. For example, in the CY 2013 PFS final rule with comment period, we adopted a policy to pay separately for transitional care management (TCM) involving the transition of a beneficiary from care furnished by a treating physician during an inpatient stay to care furnished by the beneficiary's primary physician in the community (77 FR 68978 through 68993). In the CY 2014 PFS final rule with comment period, we finalized a policy, beginning in CY 2015 (78 FR 74414), to pay separately for chronic care management (CCM) services furnished to Medicare beneficiaries with two or more qualifying chronic conditions. We believe that these new separately billable codes more accurately describe, recognize, and make payment for non-face-to-face care management services furnished by practitioners and clinical staff to particular patient populations.

We view ongoing refinements to payment for care management services as part of a broader strategy to incorporate input and information gathered from research, initiatives, and demonstrations conducted by CMS and other public and private stakeholders, the work of all parties involved in the potentially misvalued code initiative, and, more generally, from the public at large. Based on input and information gathered from these sources, we are considering several potential refinements that would continue our efforts to improve the accuracy of PFS payments. In this section, we discuss our comment solicitation and the public comments we received regarding these potential refinements.

1. Improved Payment for the Professional Work of Care Management Services

Although both the TCM and CCM services describe certain aspects of professional work, some stakeholders have suggested that neither of these new sets of codes nor the inputs used in their valuations explicitly account for all of the services and resources associated with the more extensive cognitive work that primary care physicians and other practitioners perform in planning and thinking critically about the individual chronic care needs of particular subsets of Medicare beneficiaries. Commenters stated that the time and intensity of the cognitive efforts associated with such planning are in addition to the work typically required to supervise and manage the clinical staff associated with the current TCM and CCM codes. Similarly, we continue to receive requests from a few stakeholders for CMS to lead efforts to revise the current CPT E/M codes or construct a new set of E/M codes. The goal of such efforts would be to better describe and value the work (time and intensity) specific to primary care and other cognitive specialties in the context of complex care of patients relative to the time and intensity of the procedure-oriented care physicians and practitioners, who use the same codes to report E/M services. Some of these stakeholders have suggested that in current medical practice, many physicians, in addition to the time spent treating acute illnesses, spend substantial time working toward optimal outcomes for patients with chronic conditions and patients they treat episodically, which can involve additional work not reflected in the codes that describe E/M services since that work is not typical across the wide range of practitioners that report the same codes. According to these groups, this work involves Start Printed Page 70919medication reconciliation, the assessment and integration of numerous data points, effective coordination of care among multiple other clinicians, collaboration with team members, continuous development and modification of care plans, patient or caregiver education, and the communication of test results.

We agree with stakeholders that it is important for Medicare to use codes that accurately describe the services furnished to Medicare beneficiaries and to accurately reflect the relative resources involved with furnishing those services. Therefore, in the CY 2016 PFS proposed rule we solicited public comments on ways to recognize the different resources (particularly in cognitive work) involved in delivering broad-based, ongoing treatment, beyond those resources already incorporated in the codes that describe the broader range of E/M services. The resource costs of this work may include the time and intensity related to the management of both long-term and, in some cases, episodic conditions. To appropriately recognize the different resource costs for this additional cognitive work within the structure of PFS resource-based payments, we were particularly interested in codes that could be used in addition to, not instead of, the current E/M codes.

In our comment solicitation, we stated that, in principle, these codes could be similar to the hundreds of existing add-on codes that describe additional resource costs, such as additional blocks or slides in pathology services, additional units of repair in dermatologic procedures, or additional complexity in psychotherapy services. For example, these codes might allow for the reporting of the additional time and intensity of the cognitive work often undertaken by primary care and other cognitive specialties in conjunction with an E/M service, much like add-on codes for certain procedures or diagnostic test describe the additional resources sometimes involved in furnishing those services. Similar to the CCM code, the codes might describe the increased resources used over a longer period of time than during one patient visit. For example, the add-on codes could describe the professional time in excess of 30 minutes and/or a certain set of furnished services, per one calendar month, for a single patient to coordinate care, provide patient or caregiver education, reconcile and manage medications, assess and integrate data, or develop and modify care plans. Such activity may be particularly relevant for the care of patients with multiple or complicated chronic or acute conditions, and should contribute to optimal patient outcomes including more coordinated, safer care.

Like CCM, we would require that the patient have an established relationship with the billing professional; and additionally, the use of an add-on code would require the extended professional resources to be reported with another separately payable service. However, in contrast to the CCM code, the new codes might be reported based on the resources involved in professional work, instead of the resource costs in terms of clinical staff time. The codes might also apply broadly to patients in a number of different circumstances, and would not necessarily make reporting the code(s) contingent on particular business models or technologies for medical practices. We stated that we were interested in stakeholder comments on the kinds of services that involve the type of cognitive work described above and whether or not the creation of particular codes might improve the accuracy of the relative values used for such services on the PFS. Finally, we were interested in receiving information from stakeholders on the overlap between the kinds of cognitive resource costs discussed above and those already accounted for through the currently payable codes that describe CCM and other care management services.

We strongly encouraged stakeholders to comment on this topic to assist us in developing potential proposals to address these issues through rulemaking in CY 2016 for implementation in CY 2017. We anticipated using an approach similar to our multi-year approach for implementing CCM and TCM services, to facilitate broader input from stakeholders regarding details of implementing such codes, including their structure and description, valuation, and any requirements for reporting.

Comment: We received many comments on these potential policy and coding refinements that will be useful in the development of potential future policy proposals. We note that the American Medical Association and others urged us to make separate Medicare payment for existing CPT codes that are not separately paid under the PFS, but that describe similar services and for which we have RUC-recommended values. These codes describe a broad range of services, some of which involve non face-to-face care management over a period of time.

Response: We will take the comments into consideration in developing any potential policy proposals in future PFS rulemaking.

2. Establishing Separate Payment for Collaborative Care

We believe that the care and management for Medicare beneficiaries with multiple chronic conditions, a particularly complicated disease or acute condition, or common behavioral health conditions often requires extensive discussion, information-sharing and planning between a primary care physician and a specialist (for example, with a neurologist for a patient with Alzheimer's disease plus other chronic diseases). We note that for CY 2014, CPT created four codes that describe interprofessional telephone/internet consultative services (CPT codes 99446-99449). Because Medicare includes payment for telephone consultations with or about a beneficiary as a part of other services furnished to the beneficiary, we currently do not make separate payment for these services. We note that such interprofessional consultative services are distinct from the face-to-face visits previously reported to Medicare using the consultation codes, and we refer the reader to the CY 2010 PFS final rule for information regarding Medicare payment policies for those services (74 FR 61767).

However, in considering how to improve the accuracy of our payments for care coordination, particularly for patients requiring more extensive care, in the CY 2016 PFS proposed rule we also sought comment on how Medicare might accurately account for the resource costs of a more robust interprofessional consultation within the current structure of PFS payment. For example, we were interested in stakeholders' perspectives regarding whether there are conditions under which it might be appropriate to make separate payment for services like those described by these CPT codes. We expressed interest in stakeholder input regarding the parameters of, and resources involved in, these collaborations between a specialist and primary care practitioner, especially in the context of the structure and valuation of current E/M services. In particular, we were interested in comments about how these collaborations could be distinguished from the kind of services included in other E/M services, how these services could be described if stakeholders believe the current CPT codes are not adequate, and how these services should be valued under the PFS. We also expressed interest in comments on whether we should tie those interprofessional consultations to a beneficiary encounter, and on Start Printed Page 70920developing appropriate beneficiary protections to ensure that beneficiaries are fully aware of the involvement of the specialist in the beneficiary's care and the associated benefits of the collaboration between the primary care physician and the specialist physician prior to being billed for such services.

Additionally, we solicited comments on whether this kind of care might benefit from inclusion in a CMMI model that would allow Medicare to test its effectiveness with a waiver of beneficiary financial liability and/or variation of payment amounts for the consulting and the primary care practitioners. Without such protections, beneficiaries could be responsible for coinsurance for services of physicians whose role in the beneficiary's care is not necessarily understood by the beneficiary. Finally, we also solicited comments on key technology supports needed to support collaboration between specialist and primary care practitioners in support of high quality care management services, on whether we should consider including technology requirements as part of any proposed services, and on how such requirements could be implemented in a way that minimizes burden on providers. We encouraged stakeholders to comment on this topic to assist us in developing potential proposals to address these issues through rulemaking in CY 2016 for implementation in CY 2017. We anticipated using an approach similar to our multi-year approach for implementing CCM and TCM services, to facilitate broader input from stakeholders regarding details of implementing such codes, including their structure and description, valuation, and any requirements for reporting.

Comment: We received many comments on these potential policy and coding refinements that will be useful in the development of potential future policy proposals.

Response: We will take the comments into consideration in developing any potential policy proposals in future PFS rulemaking.

a. Collaborative Care Models for Beneficiaries With Common Behavioral Health Conditions

In recent years, many randomized controlled trials have established an evidence base for an approach to caring for patients with common behavioral health conditions called “Collaborative Care.” Collaborative care typically is provided by a primary care team, consisting of a primary care provider and a care manager, who works in collaboration with a psychiatric consultant, such as a psychiatrist. Care is directed by the primary care team and includes structured care management with regular assessments of clinical status using validated tools and modification of treatment as appropriate. The psychiatric consultant provides regular consultations to the primary care team to review the clinical status and care of patients and to make recommendations. Several resources have been published that describe collaborative care models in greater detail and assess their impact, including pieces from the University of Washington (http://aims.uw.edu/​), the Institute for Clinical and Economic Review (http://ctaf.org/​reports/​integration-behavioral-health-primary-care), and the Cochrane Collaboration (http://www.cochrane.org/​CD006525/​DEPRESSN_​collaborative-care-for-people-with-depression-and-anxiety).

Because this particular kind of collaborative care model has been tested and documented in medical literature, in the proposed rule, we were particularly interested in comments on how coding under the PFS might facilitate appropriate valuation of the services furnished under such a collaborative care model. As these kinds of collaborative models of care become more prevalent, we would evaluate potential refinements to the PFS to account for the provision of services through such a model. We solicited information to assist us in considering refinements to coding and payment to address this model in particular. We also sought comments on the potential application of the collaborative care model for other diagnoses and treatment modalities. For example, we solicited comments on how a code similar to the CCM code applicable to multiple diagnoses and treatment plans could be used to describe collaborative care services, as well as other interprofessional services, and could be appropriately valued and reported within the resource-based relative value PFS system, and how the resources involved in furnishing such services could be incorporated into the current set of PFS codes without overlap. We also requested input on whether requirements similar to those used for CCM services should apply to a new collaborative care code, and whether such a code could be reported in conjunction with CCM or other E/M services. For example, we might consider whether the code should describe a minimum amount of time spent by the psychiatric consultant for a particular patient per one calendar month and be complemented by either the CCM or other care management code to support the care management and primary care elements of the collaborative care model. As with our comment solicitation on interprofessional consultation, since the patient may not have direct contact with the psychiatric consultant we solicited comments on whether and, if so, how written consent for the non-face-to-face services should be required prior to practitioners reporting any new interprofessional consultation code or the care management code.

We also solicited comments on appropriate care delivery requirements for billing, the appropriateness of CCM technology requirements or other technology requirements for these services, necessary qualifications for psychiatric consultants, and whether or not there are particular conditions for which payment would be more appropriate than others; as well as how these services may interact with quality reporting, the resource inputs we might use to value the services under the PFS (specifically, work RVUs, time, and direct PE inputs), and whether or not separate codes should be developed for the psychiatric consultant and the care management components of the service.

In addition, we solicited comments on whether this kind of care model should be implemented through a CMMI model that would allow Medicare to test its effectiveness with a waiver of beneficiary financial liability and/or variation of payment methodology and amounts for the psychiatric consultant and the primary care physician. Again, we encouraged stakeholders to comment on this topic to assist us in developing potential proposals to address these issues through rulemaking in CY 2016 for implementation in CY 2017.

Comment: We received many positive comments regarding the possibility of implementing new payment codes that would allow more accurate reporting and payment when these services are furnished to Medicare beneficiaries.

Response: We appreciate commenters' interest in appropriate coding and payment for these services. We will take all comments into consideration as we consider the development of proposals in future rulemaking.

We took particular note that several commenters identified resource inputs CMS might use to value these services under the PFS, including defined time elements. As we consider those comments, we encourage stakeholders to consider whether there are alternatives to time elements that would account for the range in intensity of services delivered in accordance with beneficiary need. In addition, since the Start Printed Page 70921collaborative care models described in the proposed rule include primary care-based care management, as well as psychiatric consulting, we encourage further input including comments on this final rule with comment period, from a broad group of stakeholders, including the community of primary care providers, who are critical in the successful provision of these Services.

3. CCM and TCM Services

a. Reducing Administrative Burden for CCM and TCM Services

In CY 2013, we implemented separate payment for TCM services under CPT codes 99495 and 99496, and in CY 2015, we implemented separate payment for CCM services under CPT code 99490. We established many service elements and billing requirements that the physician or nonphysician practitioner must satisfy to fully furnish these services and to report these codes (77 FR 68989, 79 FR 67728). Particularly because of the significant amount of non face-to-face work involved in CCM and TCM services, these elements and requirements were relatively extensive and generally exceeded those for other E/M and similar services. Since the implementation of these services, some practitioners have stated that the service elements and billing requirements are too burdensome, and suggested that they interfere with their ability to provide these care management services to their patients who could benefit from them. In light of this feedback from the physician and practitioner community, we solicited comments on steps that we could take to further improve beneficiary access to TCM and CCM services. Our aims in implementing separate payment for these services are that Medicare practitioners are paid appropriately for the services they furnish, and that beneficiaries receive comprehensive care management that benefits their long term health outcomes. However, we understand that excessive requirements on practitioners could possibly undermine the overall goals of the payment policies. In the CY 2016 PFS proposed rule, we solicited stakeholder input on how we could best balance access to these services and practitioner burdens such that Medicare beneficiaries may obtain the full benefit of these services.

b. Payment for CPT Codes Related to CCM Services

As we stated in the CY 2015 PFS final rule (79 FR 67719), we believe that Medicare beneficiaries with two or more chronic conditions as defined under the CCM code can benefit from the care management services described by that code, and we want to make this service available to all such beneficiaries. As with most services paid under the PFS, we recognized that furnishing CCM services to some beneficiaries will require more resources and some less; but we value and make payment based upon the typical service. Because CY 2015 is the first year for which we are making separate payment for CCM services, we sought information regarding the circumstances under which CCM services are furnished. This information would include the clinical status of the beneficiaries receiving the service and the resources involved in furnishing the service, such as the number of documented non-face-to-face minutes furnished by clinical staff in the months the code is reported. We were interested in examining such information to identify the range of minutes furnished over those months as well as the distribution of the number of minutes within the total volume of services. We also solicited objective data regarding the resource costs associated with furnishing the services described by this code. We stated that as we review that information, in addition to our own claims data, we would consider any changes in payment and coding that may be warranted in the coming years, including the possibility of establishing separate payment amounts and making Medicare payment for the related CPT codes, such as the complex care coordination codes, CPT codes 99487 and 99489.

Comment: We received several comments recommending various changes in the billing requirements for CCM and TCM services. Some commenters sought significant changes to the CCM scope of service elements, such as eliminating the requirement to use certified electronic health record technology (CEHRT); suspending the electronic care plan sharing requirement until such time that electronic health records (EHRs) have the ability to support such capabilities; or having CMS provide a model patient consent form. Other commenters recommended more minor changes such as clarifying the application of CCM rules regarding fax transmission from certified EHRs, and changing the reporting rules for TCM services (required date of service and when the claim can be submitted). Many commenters stated the current payment amounts are not adequate to cover the resources required to furnish CCM or TCM services and urged CMS to increase payments, for example by creating an add-on code to CPT code 99490, increasing the clinical labor PE input for CPT code 99490 to the RUC recommended 60 minutes, and/or paying separately for the complex CCM codes (CPT codes 99487 and 99489). Commenters also noted that since CY 2015 is the first year of separate payment for CCM, there is little utilization data available to assess average time spent in furnishing CCM services and similar issues. One commenter planned to share data with CMS next spring upon completion of a study on the cost and value associated with care management.

Response: We will take these comments into consideration in the development of potential proposals for future PFS rulemaking. We will develop subregulatory guidance clarifying the intersection of fax transmission and CEHRT for purposes of CCM billing. Regarding TCM services, we are adopting the commenters' suggestions that the required date of service reported on the claim be the date of the face-to-face visit, and to allow (but not require) submission of the claim when the face-to-face visit is completed, consistent with current policy governing the reporting of global surgery and other bundles of services under the PFS. We will revise the existing subregulatory guidance for TCM services accordingly.

E. Target for Relative Value Adjustments for Misvalued Services

Section 220(d) of the Protecting Access to Medicare Act of 2014 (PAMA) (Pub. L. 113-93, enacted on April 1, 2014) added a new subparagraph at section 1848(c)(2)(O) of the Act to establish an annual target for reductions in PFS expenditures resulting from adjustments to relative values of misvalued codes. Under section 1848(c)(2)(O)(ii) of the Act, if the estimated net reduction in expenditures for a year as a result of adjustments to the relative values for misvalued codes is equal to or greater than the target for that year, reduced expenditures attributable to such adjustments shall be redistributed in a budget-neutral manner within the PFS in accordance with the existing budget neutrality requirement under section 1848(c)(2)(B)(ii)(II) of the Act. The provision also specifies that the amount by which such reduced expenditures exceeds the target for a given year shall be treated as a net reduction in expenditures for the succeeding year, for purposes of determining whether the target has been met for that subsequent year. Section 1848(c)(2)(O)(iv) of the Act defines a target recapture amount as the difference between the target for the year and the estimated net reduction in expenditures under the PFS resulting Start Printed Page 70922from adjustments to RVUs for misvalued codes. Section 1848(c)(2)(O)(iii) of the Act specifies that, if the estimated net reduction in PFS expenditures for the year is less than the target for the year, an amount equal to the target recapture amount shall not be taken into account when applying the budget neutrality requirements specified in section 1848(c)(2)(B)(ii)(II) of the Act. Section 220(d) of the PAMA applies to calendar years (CYs) 2017 through 2020 and sets the target under section 1848(c)(2)(O)(v) of the Act at 0.5 percent of the estimated amount of expenditures under the PFS for each of those 4 years.

Section 202 of the Achieving a Better Life Experience Act of 2014 (ABLE) (Division B of Pub. L. 113-295, enacted December 19, 2014) amended section 1848(c)(2)(O) of the Act to accelerate the application of the PFS expenditure reduction target to CYs 2016, 2017, and 2018, and to set a 1 percent target for CY 2016 and 0.5 percent for CYs 2017 and 2018. As a result of these provisions, if the estimated net reduction for a given year is less than the target for that year, payments under the fee schedule will be reduced.

In the CY 2016 PFS proposed rule, we proposed a methodology to implement this statutory provision in a manner consistent with the broader statutory construct of the PFS. In developing this proposed methodology, we identified several aspects of our approach for which we specifically solicited comments. We organized this discussion by identifying and explaining these aspects in particular but we solicited comments on all aspects of our proposal.

1. Distinguishing “Misvalued Code” Adjustments From Other RVU Adjustments

The potentially misvalued code initiative has resulted in changes in PFS payments in several ways. First, potentially misvalued codes have been identified, reviewed, and revalued through notice and comment rulemaking. However, in many cases, the identification of particular codes as potentially misvalued has led to the review and revaluation of related codes, and frequently, to revisions to the underlying coding for large sets of related services. Similarly, the review of individual codes has initiated reviews and proposals to make broader adjustments to values for codes across the PFS, such as when the review of a series of imaging codes prompted a RUC recommendation and CMS updated the direct PE inputs for imaging services to assume digital instead of film costs. This change, originating through the misvalued code initiative, resulted in a significant reduction in RVUs for a large set of PFS services, even though the majority of affected codes were not initially identified through potentially misvalued code screens. Finally, due to both the relativity inherent in the PFS ratesetting process and the budget neutrality requirements specified in section 1848(c)(2)(B)(ii)(II) of the Act, adjustments to the RVUs for individual services necessarily result in the shifting of RVUs to broad sets of other services across the PFS.

To implement the PFS expenditure reduction target provisions under section 1848(c)(2)(O) of the Act, we must identify a subset of the adjustments in RVUs for a year to reflect an estimated “net reduction” in expenditures. Therefore, we dismissed the possibility of including all changes in RVUs for a year in calculating the estimated net reduction in PFS expenditures, even though we believe that the redistributions in RVUs to other services are an important aspect of the potentially misvalued code initiative. Conversely, we considered the possibility of limiting the calculation of the estimated net reduction in expenditures to reflect RVU adjustments made to the codes formally identified as “potentially misvalued.” We do not believe that calculation would reflect the significant changes in payments that have directly resulted from the review and revaluation of misvalued codes under section 1848(c)(2) of the Act. We further considered whether to include only those codes that underwent a comprehensive review (work and PE). As we previously have stated (76 FR 73057), we believe that a comprehensive review of the work and PE for each code leads to the more accurate assignment of RVUs and appropriate payments under the PFS than do fragmentary adjustments for only one component. However, if we calculated the net reduction in expenditures using revisions to RVUs only from comprehensive reviews, the calculation would not include changes in PE RVUs that result from proposals like the film-to-digital change for imaging services, which not only originated from the review of potentially misvalued codes, but substantially improved the accuracy of PFS payments faster and more efficiently than could have been done through the multiple-year process required to complete a comprehensive review of all imaging codes.

After considering these options, we believe that the best approach is to define the reduction in expenditures as a result of adjustments to RVUs for misvalued codes to include the estimated pool of all services with revised input values. This would limit the pool of RVU adjustments used to calculate the net reduction in expenditures to those for the services for which individual, comprehensive review or broader proposed adjustments have resulted in changes to service-level inputs of work RVUs, direct PE inputs, or MP RVUs, as well as services directly affected by changes to coding for related services. For example, coding changes in certain codes can sometimes necessitate revaluations for related codes that have not been reviewed as misvalued codes, because the coding changes have also affected the scope of the related services. This definition would incorporate all reduced expenditures from revaluations for services that are deliberately addressed as potentially misvalued codes, as well as those for services with broad-based adjustments like film-to-digital and services that are redefined through coding changes as a result of the review of misvalued codes.

Because the annual target is calculated by measuring changes from one year to the next, we also considered how to account for changes in values that are best measured over 3 years, instead of 2 years. Under our current process, the overall change in valuation for many misvalued codes is measured across values for 3 years: the original value in the first year, the interim final value in the second year, and the finalized value in the third year. As we describe in section II.H.2. of this final rule with comment period, our misvalued code process has been to establish interim final RVUs for the potentially misvalued, new, and revised codes in the final rule with comment period for a year. Then, during the 60-day period following the publication of the final rule with comment period, we accept public comment about those valuations. For the final rule with comment period for the subsequent year, we consider and respond to public comments received on the interim final values, and make any appropriate adjustments to values based on those comments. However, the calculation of the target would only compare changes between 2 years and not among 3 years, so the contribution of a particular change towards the target for any single year would be measured against only the preceding year without regard to the overall change that takes place over 3 years.

For recent years, interim final values for misvalued codes (year 2) have generally reflected reductions relative to original values (year 1), and for most codes, the interim final values (year 2) Start Printed Page 70923are maintained and finalized (year 3). However, when values for particular codes have changed between the interim final (year 2) and final values (year 3) based on public comment, the general tendency has been that codes increase in the final value (year 3) relative to the interim final value (year 2), even in cases where the final value (year 3) represents a decrease from the original value (year 1). Therefore, for these codes, the year 2 changes compared to year 1 would risk over-representing the overall reduction, while the year 3 to year 2 changes would represent an increase in value. If there were similar targets in every PFS year, and a similar number of misvalued code changes made on an interim final basis, the incongruence in measuring what is really a 3-year change in 2-year increments might not be particularly problematic since each year's calculation would presumably include a similar number of codes measured between years 1 and 2 and years 2 and 3.

However, including changes that take place over 3 years generates challenges in calculating the target for CY 2016 for two reasons. First, CY 2015 was the final full year of establishing interim final values for all new, revised, and potentially misvalued codes. Starting with this final rule with comment period, we are finalizing values for a significant portion of misvalued codes during one calendar year. Therefore, CY 2015 will include a significant number of services that would be measured between years 2 and 3 relative to the services measured between 1 and 2 years. Second, because there was no target for CY 2015, any reductions that occurred on an interim final basis for CY 2015 were not counted toward achievement of a target. If we were to include any upward adjustments made to these codes based on public comment as “misvalued code” changes for CY 2016, we would effectively be counting the service-level increases for 2016 (year 3) relative to 2015 (year 2) against achievement of the target without any consideration to the service-level changes relative to 2014 (year 1), even in cases where the overall change in valuation was negative.

Therefore, we proposed to exclude code-level input changes for CY 2015 interim final values from the calculation of the CY 2016 misvalued code target since the misvalued change occurred over multiple years, including years not applicable to the misvalued code target provision.

We note that the impact of interim final values in the calculation of targets for future years will be diminished as we transition to proposing values for almost all new, revised, and potentially misvalued codes in the proposed rule. We anticipate a smaller number of interim final values for CY 2016 relative to CY 2015. For calculation of the CY 2018 target, we anticipate almost no impact based on misvalued code adjustments that occur over multiple years.

The list of codes with changes for CY 2016 included under this definition of “adjustments to RVUs for misvalued codes” is available on the CMS Web site under downloads for the CY 2016 PFS final rule with comment period at http://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​PhysicianFeeSched/​PFS-Federal-Regulation-Notices.html.

The following is a summary of the comments we received regarding this aspect of the proposal to implement the statutory provision:

Comment: Several commenters, including the RUC, supported CMS' proposal to include all services that receive revised input values even if the specific codes were not identified on a misvalued services list for review; the commenters' stated that this is a reasonable and fair approach.

Response: We appreciate the commenters' feedback and support.

Comment: A few commenters stated that the selection of codes to be included for review beyond the codes identified by the screens should be determined by the pertinent specialty societies as they are the best determiners of which codes make up a family of codes. Another commenter stated that CMS should include the E/M services in the list of codes that are potentially misvalued.

Response: We note that the process for selection of codes to be reviewed as potentially misvalued is addressed in section II.H. of this final rule with comment period and has also been addressed in prior rulemaking. Our proposal to implement section 1848(c)(2)(O) of the Act does not address how codes are identified to be reviewed under the misvalued code initiative. Instead, it addresses how to identify the changes in expenditures that result from such reviews in the calculation of the target amount.

Comment: Several commenters, including the RUC, also supported CMS' proposal to exclude code level input changes for CY 2015 interim final values from the calculation of the target. The commenters concur that the year 2 and year 3 changes in values represent an incomplete picture of the redistributive effects for a particular year resulting from the review of the misvalued services, and the vast majority of redistribution happens between year 1 and year 2.

Response: We appreciate the commenters' support and feedback.

Comment: One commenter disagreed with CMS' proposal to exclude code-level input changes for 2015 interim final values stating that it means organized medicine does not get credit for any net decreases associated with such codes and is therefore being penalized. The commenter requested that CMS consider including 2015 interim final values in the calculation of the 2016 misvalued code target even though the misvalued change occurred over multiple years. Another commenter stated that the proposed net reduction in expenditures of 0.25 percent, as opposed to 1.00, means that the 0.75 percent difference will come from the conversion factor, and doing so would more than negate the 0.5 percent increase physicians were promised under MACRA, and therefore the commenter requested that CMS help mitigate this result by including 2015 interim final values in the calculation of the target.

Response: With regard to the commenters who disagreed with the exclusion of code-level input changes for 2015 interim final values, we cannot determine if the commenters intended to suggest that CMS was not including decreases that would help towards the achievement of the misvalued code target by excluding changes for 2015 interim final values, or that CMS should include the changes between years 1 and 3. As stated in the CY 2016 proposed rule (80 FR 41712 through 41713), when values for particular codes have changed between the interim final (year 2) and final values (year 3) based on public comment, the general tendency has been that code values increase in the final value (year 3) relative to the interim final value (year 2), even in cases where the final value (year 3) represents a decrease from the original value (year 1). Additionally, the statute requires comparison between 2 years, and therefore, we do not believe we have the authority to include changes between year 1 and year 3. Since our remaining options were to include changes between year 2 and year 3 which, as indicated above, generally results in an increase, or to exclude code-level input changes for CY 2015 interim final values, and the commenters express interest in moving closer to achievement of the target, we do not believe it would be in the commenters' interest to include the changes between years 2 and 3.Start Printed Page 70924

With regard to the commenter who stated that the net reduction in expenditures under the PFS if CMS does not achieve the target reduction would negate the 0.5 percent increase physicians were promised under MACRA, we note that both of these provisions continue to apply under current law.

Comment: Some commenters, including the RUC, suggested that CMS should be sure to include existing codes that are either being deleted or will have utilization changes as a result of the misvalued code project and/or the CPT Editorial Panel process. Another commenter stated that CMS was excluding existing codes with large volume changes, and recommended that such codes be included in the calculation of the target. Some commenters recommended that CMS conduct a procedure-to-procedure comparison and then calculate the net reduction in RVUs, including the values of new and deleted CPT codes prompted by the misvalued code initiative. The commenters stated that this is an area where the specialty societies and CMS need to work together to determine the comparisons for calculating the net reduction.

Response: We agree that changes in coding often contribute to improved valuation of PFS services. We note that we included these changes in our methodology in the proposed rule and explained that we would include services directly affected by changes to coding for related services. We did not propose to exclude existing codes with large volume changes; changes for such codes have been included. To clarify, we are including changes in values for any codes for which changes in coding or policies may result in differences in how a given service is reported from one year to the next. Under our current ratesetting methodologies, we already consider how coding revisions change the way services are reported from one year to the next. The crosswalk we use to incorporate such changes in our methodology is based on RUC and specialty society recommendations that explicitly address the kinds of procedure-to-procedure comparisons suggested by the commenter. This file is available in the “downloads” section of the PFS Web site at http://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​PhysicianFeeSched/​PFS-Federal-Regulation-Notices.html under “Analytic Crosswalk from CY 2015 to CY 2016.” Since it reflects the best information available, we used the same crosswalk to account for coding changes in the calculation of the target. We also refer readers to the list of HCPCS defined as misvalued for purposes of the target which is available on the CMS Web site under downloads for the CY 2016 PFS final rule with comment period.

Comment: One commenter recommended that CMS include the review of all individual codes and broader adjustments across the PFS, as this would more accurately represent the total revaluations.

Response: As we explained in the proposed rule, our goal is to include the review of all individual codes and changes to inputs for additional codes where changes can be measured between two years. Because PFS payments are developed under the statutory requirements of relativity and budget neutrality, including all adjustments to all codes would necessarily result in a net of zero.

Comment: A few commenters raised objections to the statutory provision. For example, one commenter stated that the legislation is penalizing physicians and other healthcare professionals for already having taken on the task of identifying and revaluating potentially misvalued codes over the past 10 years. Other commenters stated that since the RUC and specialty societies have been addressing potentially misvalued codes since 2006, there should be a way to include revaluations made back to 2006 in the calculation of the target. Another commenter stated that CMS should hold primary care and E/M services harmless in this process, since these services are not over-valued but rather under-valued. One commenter requested more time to evaluate the proposed process to identify yearly targets, and encouraged CMS to work with the AMA to discuss this issue at future RUC Panel meetings prior to implementing the provision. One commenter requested that CMS review its approach to determine if there are other methods that will come closer to reaching the target. One commenter stated that this new requirement creates a potential incentive to target codes that offer the greatest likelihood of savings, not those that are actually misvalued.

Response: We appreciate the commenters' feedback and have considered these concerns to the extent possible in light of the requirements of section 1848(c)(2)(O) of the Act.

After consideration of the public comments received, we are finalizing the approach of defining the reduction in expenditures as a result of adjustments to RVUs for misvalued codes to include the estimated pool of all services with revised input values, including any codes for which changes in coding or policies might result in differences in how a given service is reported from one year to the next. We are also finalizing our proposal to exclude code-level input changes for CY 2015 interim final values from the calculation of the CY 2016 misvalued code target. After considering all comments, we continue to believe this approach is appropriate and compliant with statutory directives.

2. Calculating “Net Reduction”

Once the RVU adjustments attributable to misvalued codes are identified, estimated net reductions in PFS expenditures resulting from those adjustments would be calculated by determining the sum of all decreases and offsetting them against any applicable increases in valuation within the changes that we defined as misvalued, as described above. Because section 1848(c)(2)(O)(i) of the Act only explicitly addresses reductions in expenditures, and we recognize that many stakeholders will want to maximize the overall magnitude of the measured reductions in order to prevent an overall reduction to the PFS conversion factor, we considered the possibility of ignoring the applicable increases in valuation in the calculation of net reduction. However, we believe that the requirement to calculate “net” reductions implies that we are to take into consideration both decreases and increases. Additionally, we believe this approach may be the only practical one due to the presence of new and deleted codes on an annual basis.

For example, a service that is described by a single code in a given year, like intensity-modulated radiation therapy (IMRT) treatment delivery, could be addressed as a misvalued service in a subsequent year through a coding revision that splits the service into two codes, “simple” and “complex.” If we counted only the reductions in RVUs, we would count only the change in value between the single code and the new code that describes the “simple” treatment delivery code. In this scenario, the change in value from the single code to the new “complex” treatment delivery code would be ignored, so that even if there were an increase in the payment for IMRT treatment delivery service(s) overall, the mere change in coding would contribute inappropriately to a “net reduction in expenditures.” Therefore, we proposed to net the increases and decreases in values for services, including those for which there are coding revisions, in calculating the estimated net reduction in expenditures as a result of adjustments to RVUs for misvalued codes.Start Printed Page 70925

The following is a summary of the comments we received regarding our proposal.

Comment: One commenter stated that the proposal for calculating net reduction is consistent with the plain reading of the statute.

Response: We appreciate the commenter's feedback and support.

Comment: Several commenters, including the RUC, requested that CMS use a more transparent process for calculation of the target, suggesting that the discussion in the CY 2016 PFS proposed rule was not sufficiently detailed to allow for replication by external stakeholders. Commenters requested that CMS provide a comprehensive methodological description of how CMS will calculate the target, including publication of dollar figure estimates, and information about individual service level estimated impacts on the net reduction. Commenters further requested that we provide the impact on the net reduction either per CPT code, or that we identify a family of services and publish a combined impact for that family. Another commenter expressed concern with how CMS will operationalize this policy, noting that the language in the CY 2016 PFS proposed rule did not outline where the adjustments would be made. The commenter further questioned how CMS planned to track the “savings” from the revaluation of services, and requested that CMS clarify how new technology will be handled, as well as new codes that are a restructuring of existing codes.

Response: We appreciate the commenters' feedback. In response to the request for greater transparency, we have posted a public use file that provides a comprehensive description of how the target is calculated as well as the estimated impact by code family on the CMS Web site under the supporting data files for the CY 2016 PFS final rule at http://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​PhysicianFeeSched/​index.html.

In response to the commenter who asked for clarification on how new technology will be handled, we assume the commenter intends to ask about how new codes for new services would be addressed under our proposed methodology. Under our proposal, we would include adjustments to values for all deleted, new, and revised codes under our calculations of changes from one year to the next. We would also weight the changes in the values for those codes by the utilization for those services in order to calculate the net reduction in expenditures. If a new code describes a new service (new technology as opposed to recoding of an existing service), then there would be no utilization for that code in the calculation. Without utilization, the value for a new service would have no impact on the calculation of the target. In response to the commenter who expressed concern about how CMS would operationalize this policy, and stated that CMS did not explain where the adjustments would be, we note that if the estimated net reduction in expenditures is less than the target for the year, then there would be an overall reduction to the PFS conversion factor as described in section VI. of this final rule with comment period.

Comment: One commenter disagreed that all increases should be incorporated into the net reduction calculation and requested that CMS consider an approach that would maximize the overall magnitude of the measured reductions in order to prevent an overall reduction to the PFS conversion factor as a result of failure to achieve the target for reductions. Specifically, the commenter stated that codes identified as potentially misvalued for which there is compelling evidence based on the RUC recommendations to support an increase in RVUs based on a change in work should not be defined as misvalued for the purposes of calculating the target.

Response: We believe the requirement that we calculate the net reduction in expenditures indicates that we must account for adjustments in values including both increases and decreases and therefore, believe our proposal comports with the plain reading of the statute. We recognize that the RUC internal deliberations include rules that govern under what circumstances individual specialties can request that the RUC recommend CMS increase values for particular services. As observers to the RUC process, we appreciate having an understanding of these rules in the context of our review of RUC-recommended values. However, we do not believe that the internal RUC standards for developing recommendations are relevant in determining whether the statutory provision applies to adjustments to values for individual codes.

Comment: Some commenters requested that CMS review its administrative authority to achieve a target recapture amount in a selective manner, rather than by an across-the-board adjustment to the conversion factor. A commenter stated that codes already sustaining reductions in 2016, and consequently contributing to the target, should not be subjected to additional across-the-board cuts to achieve the statutory target.

Response: We do not believe that section 1848(c)(2)(O)(iii) of the Act provides us authority to insulate particular services from the effects of the budget neutrality adjustment for the target recapture amount that is required if the estimated net reduction in expenditures is less than the target for the year. The statute specifies that an amount equal to the target recapture amount is not to be taken into account in applying the PFS budget neutrality requirement under section 1848(c)(2)(B)(ii)(II) of the Act. This PFS budget neutrality adjustment has been in place since the outset of the PFS, and we have consistently interpreted and implemented it as an adjustment that is made across the entire PFS. Therefore, we do not believe we can apply the budget neutrality adjustments in a selective manner.

Comment: Several commenters, including the RUC, stated that when considering the net impact of service-level input changes in a given year, it is important for CMS to understand specific scenarios in which codes under review should not be included in the net reduction target calculation. The commenters requested that CMS not include particular payment initiatives, such as Advance Care Planning (ACP), in the target definition. Instead, since the payment rates for these services require budget neutrality and relativity adjustments to all other PFS services and these reductions are not otherwise accounted for in the target calculation, CMS should count the payments for ACP services as “redistribution” (or, in other words, reductions) from other services for CY 2016. Commenters urged CMS to use the same approach for care management services valued under the PFS in the future. Generally, the commenters stated that these and similar new codes could not possibly be misvalued and therefore, should not only be excluded from the target, but the reductions to other services due to separate payment for these services should be counted as net reductions toward achievement of the misvalued code target.

Response: Because we believe that all of our intended revaluations of services under the PFS are intended to improve the accuracy of the relative value units for PFS services, we do not believe we should exclude increases and decreases to particular services in the target calculation. Therefore, we do not agree with commenters' suggestions that codes describing one kind of service (e.g. care management) as opposed to another (for example, procedures or Start Printed Page 70926diagnostic tests) should be excluded from the target under the statutory provision. Similarly, we do not agree that counting the relativity and budget neutrality redistributions that result from care management services as part of the net “reduction” would be consistent with a reasonable understanding of “net reduction” in allowed expenditures as a result of changes to misvalued codes.

However, in considering the points raised by commenters, we do agree that the increases in value for new codes like ACP or Chronic Care Management (CCM) are not the same as increases to other services. In general, new codes describe new services that would not have been reported with particular codes in the previous years or new codes describe existing services that were reported using other codes in the prior year. In other cases, however, new codes describe services that were previously included in the payment for other codes. When those services become separately payable through new codes, we generally make adjustments to other relevant codes to adjust for the value of the services that will be separately reported. In general, new codes describing care management services fall into this latter category, since the associated resource costs for these services were previously bundled into payment for other services. However, unlike many other PFS services, the resource costs for these kinds of services were bundled into a set of broadly reported E/M codes and services that include E/M visits. Since these codes are so broadly reported across nearly all PFS specialties, to the extent that it would be impracticable to make adjustments to individual codes, we have not made corresponding adjustments to E/M visits to account for the status of the new codes as separately billable. Instead, when unbundling new separately reported services such as these, we have allowed our general budget neutrality adjustment to account for these types of changes, since budget neutrality adjustments apply broadly to the full range of PFS services, including both codes that specifically describe E/M visits and those with E/M services as components of the service, such as all codes with global periods. In terms of calculating the net reduction in expenditures for purposes of section 1848(c)(2)(O)(i) of the Act, this means that the shift in payment to these new separately reportable services, unlike the adjustments to values for other new services, is not offset by adjustments to any other individual codes. Therefore, under the methodology we proposed, the increase in payment for these new separately reportable services would be counted in the net reduction calculations since the adjustments to values for these services are reflected in values for individual codes, but the corresponding decreases would not be counted, since the corresponding decreases are not attributable to any particular codes. Under the methodology we proposed, the change to make these types of codes separately reported would be counted against achievement of the target even though the increases in value for these codes are fully offset by budget-neutrality adjustments to all other PFS services.

As we have reflected on the comments and on this particular circumstance, we do not believe that the change to separate payment for these kinds of services should be counted as increases that are included in calculating the “net reductions” in expenditures attributable to adjustments for misvalued codes. Instead, we think that the adjustments to value these services should be considered in the context of the budget neutrality adjustments that are applied broadly to PFS services. This would be consistent with our treatment of the increase in values for other new codes since the reductions or deletion of predecessor codes are counted as offsets in our calculation. Since, under the established ratesetting methodology, the increases in new separately reportable services and the corresponding budget neutrality decreases fully offset one another and net to zero, we believe that the easiest way to account for the adjustments associated with valuing these services is to exclude altogether the changes for these types of codes from the list of codes included in the target. This will effectively make the creation and valuation of such codes neutral in the calculation of the misvalued code target.

After considering public comments, we are finalizing our policy as proposed with a modification to exclude from the calculation of the “net reduction” in expenditures changes in coding and valuation for services, such as ACP for CY 2016, that are newly reportable, but for which no corresponding reduction is made to existing codes and instead reductions are taken exclusively through a budget neutrality adjustment.

3. Measuring the Adjustments

The most straightforward method to estimating the net reduction in expenditures due to adjustments to RVUs for misvalued codes is to compare the total RVUs of the relevant set of codes (by volume) in the current year to the update year, and divide that by the total RVUs for all codes (by volume) for the current year. This approach had the advantage of being intuitive and readily replicable.

However, there are several issues related to the potential imprecision of this method. First, and most significantly, the code-level PE RVUs in the update year include either increases due to the redistribution of RVUs from other services or reductions due to increases in PE for other services. Second, because relativity for work RVUs is maintained through annual adjustments to the CF, the precise value of a work RVU in any given year is adjusted based on the total number of work RVUs in that year. Finally, relativity for the MP RVUs is maintained by both redistribution of MP RVUs and adjustments to the CF, when necessary (under our proposed methodology this is true annually; based on our established methodology the redistribution of the MP RVUs only takes place once every 5 years and the CF is adjusted otherwise). Therefore, to make a more precise assessment of the net reduction in expenditures that are the result of adjustments to the RVUs for misvalued codes, we would need to compare, for the included codes, the update year's total work RVUs (by volume), direct PE RVUs (by volume), indirect PE RVUs (by volume), and MP RVUs (by volume) to the same RVUs in the current year, prior to the application of any scaling factors or adjustments. This would make for a direct comparison between years.

However, this approach would mean that the calculation of the net reduction in expenditures would occur within various steps of the PFS ratesetting methodology. Although we believe that this approach would be transparent and external stakeholders could replicate this method, it might be difficult and time-consuming for stakeholders to do so. We also noted that when we modeled the interaction of the statutory phase-in requirement under section 220(e) of the PAMA and the calculation of the target using this approach during the development of this proposal, there were methodological challenges in making these calculations. When we simulated the two approaches using information from prior years, we found that both approaches generally resulted in similar estimated net reductions. After considering these options, we proposed to use the simpler approach of comparing the total RVUs (by volume) for the relevant set of codes in the current year to the update year, and divide that result by the total RVUs (by volume) for the current year. We solicited comments on whether Start Printed Page 70927comparing the update year's work RVUs, direct PE RVUs, indirect PE RVUs, and MP RVUs for the relevant set of codes (by volume) prior to the application of any scaling factors or adjustments to those of the current year would be a preferable methodology for determining the estimated net reduction.

The following is a summary of the comments we received regarding our proposal.

Comment: A few commenters supported CMS' selection of the simpler formula to calculate the target over the more precise but more complex formula since it is simpler and easier to understand. One commenter stated that CMS did not indicate exactly how similar the two proposals are or which method estimated the larger reduction, and stated that CMS should make this information available in the final rule and consider revising the approach in CY 2017 rulemaking and use the method that results in the larger reduction.

Response: We do not agree that CMS should do both calculations and determine which to use based solely on which results in the higher amount. We note that the target for net reductions in expenditures from adjustments to values for misvalued codes is a multi-year provision and we believe neither of the two methodologies is assured to produce a consistently higher result from year to year. Since the majority of commenters agree that the more intuitive approach to estimating the net reduction in expenditures is preferable to the more precisely accurate approach, we are finalizing our approach as proposed.

Comment: One commenter requested that CMS count the full reduction in payment for codes subject to the phase-in required under section 1848(c)(7) of the Act as discussed in section II.F. of this final rule with comment period, toward the target in the first year. Another commenter stated that CMS used the fully reduced RVUs in calculating the target, not the first year phase-in RVUs, and therefore, CMS should include the full impact of the change in the equipment utilization rate for linear accelerators toward the target calculation. Similarly, the commenter requested that any future multi-year phase-in proposals should similarly be counted toward the target in the first year.

Response: The target provision requires the calculation of an estimated net reduction measure between 2 years of PFS expenditures. As we have detailed in the above paragraphs, we believe that under certain specific circumstances, changes should be excluded from that estimate; but we do not believe we can include changes that would occur in future years based solely on the rulemaking cycle during which policies are established. Therefore we will not count the full reduction in payment for codes that are subject to the phase-in toward the calculation of the net reduction in expenditures for the first year. With regard to the commenter that stated that CMS used the fully reduced RVUs in calculating the target, we note that we only used the first year phase-in RVUs and, for the reasons stated above, believe that we are limited to including only the changes in the immediate year in the calculation of the target.

After consideration of the public comments received, we are finalizing the policy to calculate the net reduction using the simpler method as proposed.

4. Target Achievement for CY 2016

We refer readers to the regulatory impact analysis section of this final rule with comment period for our final estimate of the net reduction in expenditures relative to the 1 percent target for CY 2016, and the resulting adjustment required to be made to the conversion factor. Additionally, we refer readers to the public use file that provides a comprehensive description of how the target is calculated as well as the estimated impact by code family on the CMS Web site under the supporting data files for the CY 2016 PFS final rule at http://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​PhysicianFeeSched/​index.html.

F. Phase-In of Significant RVU Reductions

Section 1848(c)(7) of the Act, as added by section 220(e) of the PAMA, also specifies that for services that are not new or revised codes, if the total RVUs for a service for a year would otherwise be decreased by an estimated 20 percent or more as compared to the total RVUs for the previous year, the applicable adjustments in work, PE, and MP RVUs shall be phased-in over a 2-year period. Although section 220(e) of the PAMA required the phase-in to begin for 2017, section 202 of the ABLE Act amended section 1848(c)(7) of the Act to require that the phase-in begin for CY 2016.

In the CY 2016 PFS proposed rule, we proposed a methodology to implement this statutory provision. In developing this methodology, we identified several aspects of our approach for which we specifically solicited comments, given the challenges inherent in implementing this provision in a manner consistent with the broader statutory construct of the PFS. We organized this discussion by identifying and explaining these aspects in particular but we solicited comments on all aspects of our proposal.

1. Identifying Services That Are Not New or Revised Codes

As described in this final rule with comment period, the statute specifies that services described by new or revised codes are not subject to the phase-in of RVUs. We believe this exclusion recognizes the reality that there is no practical way to phase-in changes to RVUs that occur as a result of a coding change for a particular service over 2 years because there is no relevant reference code or value on which to base the transition. To determine which services are described by new or revised codes for purposes of the phase-in provision, we proposed to apply the phase-in to all services that are described by the same, unrevised code in both the current and update year, and to exclude codes that describe different services in the current and update year. This approach excludes services described by new codes or existing codes for which the descriptors were altered substantially for the update year to change the services that are reported using the code. We also are excluding as new and revised codes those codes that describe a different set of services in the update year when compared to the current year by virtue of changes in other, related codes, or codes that are part of a family with significant coding revisions. For example, significant coding revisions within a family of codes can change the relationships among codes to the extent that it changes the way that all services in the group are reported, even if some individual codes retain the same number or, in some cases, the same descriptor. Excluding codes from the phase-in when there are significant revisions to the code family would also help to maintain the appropriate rank order among codes in the family, avoiding years for which RVU changes for some codes in a family are in transition while others were fully implemented. This application of the phase-in is also consistent with previous RVU transitions, especially for PE RVUs, for which we only applied transition values to those codes that described the same service in both the current and the update years. We also excluded from the phase-in as new and revised codes those codes with changes to the global period, since the code in the current year would not describe the Start Printed Page 70928same units of service as the code in the update year.

We received few comments regarding this aspect of our proposal, and some of the comments suggested changes that would require changes to the statutory provision that requires the phase-in of significant changes in RVUs. The following is a summary of the comments that we received.

Comment: One commenter agreed with CMS' broad definition of new or revised.

Response: We appreciate the commenter's feedback and support.

Comment: One commenter did not agree that new and revised services should be excluded from the phase-in, and suggested that the phase-in be applied more broadly.

Response: Section 1848(c)(7) of the Act specifies that services described by new or revised codes are not subject to the phase-in of significant reductions in RVUs. Additionally, because RVUs are assigned to individual codes, we do not believe there would be a straightforward or transparent way to phase in reductions for services that are described by new or revised codes between the years for which a phase-in would apply.

Comment: One commenter urged CMS to include in the phase-in codes that had interim Final values for CY 2015 and have substantial reductions of 20 percent or greater as compared to the 2014 values.

Response: We do not believe it would be consistent with the statutory provision to phase in changes in values between 2015 and 2016 based on 2014 values. Section 1848(c)(7) of the Act, as amended, specifies that the phase-in of significant reductions in values begins for fee schedules established beginning with 2016.

Comment: One commenter stated that any code that has a decrease in value of over 20 percent due to repricing of expensive supplies (for example, over $500) should be excluded from the phase-in provision.

Response: We appreciate the commenter's feedback and understand the rationale for the request; however, we do not believe that we have the discretion to exempt codes from the phase-in, regardless of the reason for the reduction.

After consideration of the public comments received on this aspect of our proposal to implement the phase-in of significant changes in RVUs, we are finalizing the implementation of the phase-in for significant (20 percent or greater) reductions in RVUs as proposed.

2. Estimating the 20 Percent Threshold

Because the phase-in of significant reductions in RVUs falls within the budget neutrality requirements specified in section 1848(c)(2)(B)(ii)(II) of the Act, we proposed to estimate total RVUs for a service prior to the budget-neutrality redistributions that result from implementing phase-in values. We recognize that the result of this approach could mean that some codes may not qualify for the phase-in despite a reduction in RVUs that is ultimately slightly greater than 20 percent due to budget neutrality adjustments that are made after identifying the codes that meet the threshold in order to reflect the phase-in values for other codes. We believe the only alternative to this approach is not practicable, since it would be circular, resulting in cyclical iteration.

The following is a summary of the comments we received regarding this proposal.

Comment: One commenter supported CMS' proposal for estimating the 20 percent threshold.

Response: We appreciate the commenter's support.

Comment: Another commenter did not agree with the proposal to estimate total RVUs for a service prior to the budget-neutrality redistributions that result from implementing phase-in values. The commenter stated that the methodology should not give inequitable treatment to any particular specialty, and instead it should apply to all codes that are cut greater than 20 percent in the final analysis.

Response: We appreciate that our proposed methodology could, in the end, result in no phase-in for some codes that ultimately do have a 20 percent or greater reduction in value after application of required budget neutrality adjustment. However, we have no reason to believe that this situation, resulting from using initial unadjusted RVUs to identify significant RVU reductions, would disadvantage one specialty more than the next. Therefore, we also do not believe that our proposed approach is likely to result in unequitable treatment to any one specialty over another.

After consideration of the public comments received on this aspect of our proposal, we are finalizing without modification our proposal to identify significant reductions in RVUs based on a comparison of RVUs before application of budget neutrality adjustment.

3. RVUs in the First Year of the Phase-In

Section 1848(c)(7) of the Act states that the applicable adjustments in work, PE, and MP RVUs shall be phased-in over a 2-year period when the RVU reduction for a code is estimated to be equal to or greater than 20 percent. We believe that there are two reasonable ways to determine the portion of the reduction to be phase-in for the first year. Most recent RVU transitions have distributed the values evenly across several years. For example, for a 2-year transition we would estimate the fully implemented value and set a rate approximately 50 percent between the value for the current year and the value for the update year. We believe that this is the most intuitive approach to the phase-in and is likely the expectation for many stakeholders. However, we believe that the 50 percent phase-in in the first year has a significant drawback. For instance, since the statute establishes a 20 percent threshold as the trigger for phasing in the change in RVUs, under the 50 percent phase-in approach, a service that is estimated to be reduced by a total of 19 percent for an update year would be reduced by a full 19 percent in that update year, while a service that is estimated to be reduced by 20 percent in an update year would only be reduced 10 percent in that update year.

The logical alternative approach is to consider a 19 percent reduction as the maximum 1-year reduction for any service not described by a new or revised code. This approach would be to reduce the service by the maximum allowed amount (that is, 19 percent) in the first year, and then phase in the remainder of the reduction in the second year. Under this approach, the code that is reduced by 19 percent in a year and the code that would otherwise have been reduced by 20 percent would both be reduced by 19 percent in the first year, and the latter code would see an additional 1 percent reduction in the second year of the phase-in. For most services, this would likely mean that the majority of the reduction would take place in the first year of the phase-in. However, for services with the most drastic reductions (greater than 40 percent), the majority of the reduction would not take place in the first year of the phase-in.

After considering both of these options, we proposed to consider the 19 percent reduction as the maximum 1-year reduction and to phase-in any remaining reduction greater than 19 percent in the second year of the phase-in. We believe that this approach is Start Printed Page 70929more equitable for codes with significant reductions but that are less than 20 percent. We solicited comments on this proposal.

The following is a summary of the comments we received regarding this proposal.

Comment: Several commenters supported CMS' proposal to consider the 19 percent reduction as the maximum 1-year reduction and to phase in any remaining reduction greater than 19 percent in the second year of the phase-in.

Response: We appreciate the commenters' feedback and support.

Comment: Several commenters did not support CMS' proposal, and instead stated that CMS should spread the transition evenly over both years—meaning a 50 percent phase-in for year one and year two. One commenter stated that this would lead to a more equitable payment system and allow physicians more time to make changes in their practices to accommodate for reductions. Another commenter acknowledged that codes with reductions that are less than 20 percent and not phased-in may experience greater reductions in the first year, however the commenter stated that a more gradual phase-in for practices facing steeper cuts should be the paramount principle for any policy to transition cuts at or greater than 20 percent.

Response: We have considered the comments and understand the commenters' concerns. We acknowledge some commenters' views that the gradual phase-in of reductions for services that would experience reductions above the threshold (20 percent) is an important principle in determining the best way to implement the phase-in provision. However, we note that the 19 percent reduction maximum also has the advantage of applying the most gradual reduction to services with the greatest reductions (greater than 40 percent). Furthermore, we remain concerned about several practical problems that could arise from utilizing the 50 percent approach. The first of these problems would occur whenever some codes within the same family of services would meet threshold reductions while others do not. For example if two codes in a four code family would be reduced by an estimated 20 percent while the other two were estimated to be reduced by 19 percent, then the first two would be reduced by 10 percent while the remaining two would be reduced by 19 percent. Such a scenario could easily create rank order anomalies within families of codes. The risks of such anomalies is associated with the financial incentives toward inaccurate downward coding that could not only jeopardize Medicare claims data as an accurate source of information, but more directly could have serious consequences within our ratesetting methodologies for both purposes of budget neutrality and for allocation of PE and MP RVUs. The second practical issue with the 50 percent approach would be that the impact of using the estimated reduction instead of the final reduction to determine whether or not particular codes qualify for the phase-in would be significant. Under the 19 percent approach, values for codes with reductions estimated to be very close to 19 percent would be similar regardless of whether or not we engage in various iterations of budget neutrality adjustments to determine whether or not the phase-in applies. Under the 50 percent approach, determinations that result from repeated iterations of ratesetting calculations and budget neutrality adjustments could decide significant changes in the rates for individual codes (up to 10 percent of the total payment.)

In order to avoid these circumstances and apply the most gradual phase-in possible to codes with the most significant reductions, we continue to believe that a 19 percent reduction as the maximum 1-year reduction is the better approach to determining the phase-in amount.

Comment: One commenter requested that the phase-in period be extended to a greater number of years when entire code groupings are impacted, and when multiple codes are identified within a code grouping and they significantly impact revenue to a specialist or specific provider.

Response: The statute specifies a 2-year phase-in period and does not provide authority to extend the phase-in period as described by the commenter.

After consideration of the comments, we are finalizing the policy to phase in 19 percent of the reduction in value in the first year, and the remainder of the reduction in the second year, as proposed.

4. Applicable Adjustments to RVUs

Section 1848(c)(7) of the Act provides that the applicable adjustments in work, PE, and MP RVUs be phased-in over 2 years for any service for which total RVUs would otherwise be decreased by an estimated amount equal to or greater than 20 percent as compared to the total RVUs for the previous year. However, for several thousand services, we develop separate RVUs for facility and nonfacility sites of service. For nearly one thousand other services, we develop separate RVUs for the professional and technical components of the service, and sum those RVUs for global billing. Therefore, for individual practitioners furnishing particular services to Medicare beneficiaries, the relevant changes in RVUs for a particular code are based on the total RVUs for a code for a particular setting (facility/nonfacility) or for a particular professional/technical (PC/TC) component. We believe the most straightforward and fair approach to addressing both the site of service differential and the codes with professional and technical components is to consider the RVUs for the different sites of service and components independently for purposes of identifying when and how the phase-in applies. We proposed, therefore, to estimate whether a particular code met the 20 percent threshold for change in total RVUs by taking into account the total RVUs that apply to a particular setting, or to a particular professional or technical component. This would mean that if the change in total facility RVUs for a code met the threshold, then that change would be phased in over 2 years, even if the change for the total nonfacility RVUs for the same code would not be phased in over 2 years. Similarly, if the change in the total RVUs for the technical component of a service meets the 20 percent threshold, then that change would be phased in over 2 years, even if the change for the professional component did not meet the threshold. (Because the global is the sum of the professional and technical components, the portion of the global attributable to the technical component would then be phased-in, while the portion attributable to the professional component would not be.)

However, we note that we create the site of service differential exclusively by developing independent PE RVUs for each service in the nonfacility and facility settings. That is, for these codes, we use the same work RVUs and MP RVUs in both settings and vary only the PE RVUs to implement the difference in resources depending on the setting. Similarly, we use the work RVUs assigned to the professional component codes as the work RVUs for the service when billed globally. Like the codes with the site of service differential, the PE RVUs for each component are developed independently. The resulting PE RVUs are then summed for use as the PE RVUs for the code, billed globally. Since variation of PE RVUs is the only constant across all individual codes, Start Printed Page 70930codes with site of service differentials, and codes with professional and technical components, we are proposing to apply all adjustments for the phase-in to the PE RVUs.

We considered alternatives to this approach. For example, for codes with a site of service differential, we considered applying a phase-in for codes in both settings (and all components) whenever the total RVUs in either setting reached the 20 percent threshold. However, there are cases where the total RVUs for a code in one setting (or one component) may reach the 20 percent reduction threshold, while the total RVUs for the other setting (or other component) are increasing. In those cases, applying phase-in values for work or MP RVUs would mean applying an additional increase in total RVUs for particular services. We also considered implementing the phase-in of the RVUs for the component codes billed globally by comparing the global value in the prior year versus the global value in the current year and applying the phase-in to the global value for the current year and letting the results flow through to the PC and TC for each code, irrespective of their respective changes in value. Similarly, for the codes with site of service differentials, we considered developing an overall, blended set of overall PE RVUs using a weighted average of site of service volume in the Medicare claims data and then comparing that blended value in the prior year versus the blended value in the current year and applying the phase-in to the value for the current year before re-allocating the blended value to the respective PE RVUs in each setting, regardless of the changes in value for nonfacility or facility values. We did not pursue this approach for several reasons. First, the resulting phase-in amounts would not relate logically to the values paid to any individual practitioner, except those who bill the PC/TC codes globally. Second, the approach would be so administratively complicated that it would likely be difficult to replicate or predict.

Therefore, we have concluded that applying the adjustments to the PE RVUs for all individual codes in order to effect the appropriate phase-in amount is the most straightforward and fair approach to implementing the 2-year phase-in of significant reductions of total RVUs.

The following is a summary of the comments we received regarding this proposal.

Comment: One commenter requested that CMS confirm that it would apply all adjustments for the phase-in to the PE RVUs only in situations in which just one site of service, or just one component is subject to the phase-in. That is, if both sites of service or both components of a code were subject to the phase-in, then any adjustments would be applied to work and malpractice RVUs as well.

Response: As discussed in the proposal, all adjustments for the phase-in, including for codes with facility and nonfacility RVUs and PC/TC splits, will be applied to the PE RVUs only. We acknowledge that for some codes it would be hypothetically possible to phase in the reductions proportionally across all three RVU components. As we explained in the proposed rule, it would not be practical to do so for services with site of service differentials since each of the three RVU components represent a different proportion of overall nonfacility or facility RVUs. Therefore, we believe this alternative approach could only work for codes without site of service differentials and those without PC/TC splits, which represents a minority of PFS services. We believe that applying the phase-in for these large categories of codes differently than for the rest of PFS codes would be confusing to the public and make adjustments unpredictable since they would be based on whether or not the service priced in the opposite setting met the phase-in threshold. Furthermore, we remind commenters that because the work RVU is an important allocator of indirect PE in the established methodology, the overall payment impact of any changes in work RVUs is also automatically reflected in corresponding changes to the PE RVUs, whereas changes to direct PE inputs do not have a parallel impact on work RVUs. Therefore, even for individual codes for which it might be possible to establish phase-in values for work RVUs, the necessary adjustments would necessarily be weighted more heavily in PE RVUs.

Comment: With regard to CMS' proposal to consider the RVUs for different sites of service and components independently for the purposes of identifying when and how the phase-in applies, one commenter expressed concerns that the proposed approach ignores the spirit of section 220(e) of the PAMA to benefit physician practices by dampening the year to year impact of large payment reductions. The commenter stated that if CMS adjusts only the PE RVUs, then a large number of codes with greater than 20 percent work RVU reductions could be excluded. The commenter urged CMS to clarify its intent to dampen the effects of year to year reductions to both work RVUs and PE RVUs independently, even for codes with separate facility and non-facility PE RVUs.

Response: We appreciate the commenter's feedback and we acknowledge that our proposed approach would not dampen the year to year reductions in work RVUs. However, our approach would dampen the effect of any payment reductions for all codes, including those reductions that would result from reductions to work RVUs when such reductions contributed to an overall reduction of 20 percent or greater, consistent with the statutory provision. As a practical matter, we believe that practitioners reporting services furnished to Medicare beneficiaries and paid through the PFS would be paid very similar amounts regardless of which approach we implemented. We also note that the commenter did not provide any information that would help us to understand how the suggested phase-in could be applied to services with site of service differentials.

After consideration of the comments received, we are finalizing this aspect of the phase-in methodology as proposed.

The list of codes subject to the phase-in and the associated RVUs that result from this methodology are available on the CMS Web site under downloads for the CY 2016 PFS final rule with comment period at http://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​PhysicianFeeSched/​PFS-Federal-Regulation-Notices.html.

G. Changes for Computed Tomography (CT) Under the Protecting Access to Medicare Act of 2014 (PAMA)

Section 218(a)(1) of the Protecting Access to Medicare Act of 2014 (PAMA) (Pub. L. 113-93) amended section 1834 of the Act by establishing a new subsection 1834(p). Effective for services furnished on or after January 1, 2016, new section 1834(p) of the Act reduces payment for the technical component (TC) of applicable CT services paid under the Medicare PFS and applicable CT services paid under the OPPS (a 5-percent reduction in 2016 and a 15-percent reduction in 2017 and subsequent years). The applicable CT services are identified by HCPCS codes 70450 through 70498; 71250 through 71275; 72125 through 72133; 72191 through 72194; 73200 through 73206; 73700 through 73706; 74150 through 74178; 74261 through 74263; and 75571 through 75574 (and any succeeding codes). As specified in section 1834(p)(4) of the Act, the reduction applies for applicable services furnished using equipment that does not meet Start Printed Page 70931each of the attributes of the National Electrical Manufacturers Association (NEMA) Standard XR-29-2013, entitled “Standard Attributes on CT Equipment Related to Dose Optimization and Management.” Section 1834(p)(4) of the Act also specifies that the Secretary may apply successor standards through rulemaking.

Section 1834(p)(6)(A) of the Act requires that information be provided and attested to by a supplier and a hospital outpatient department that indicates whether an applicable CT service was furnished that was not consistent with the standard set forth in section 1834(p)(4) of the Act (currently the NEMA CT equipment standard) and that such information may be included on a claim and may be a modifier. Section 1834(p)(6)(A) of the Act also provides that such information must be verified, as appropriate, as part of the periodic accreditation of suppliers under section 1834(e) of the Act and hospitals under section 1865(a) of the Act. Section 218(a)(2) of the PAMA made a conforming amendment to section 1848 (c)(2)(B)(v) of the Act by adding a new subclause (VIII), which provides that, effective for fee schedules established beginning with 2016, reduced expenditures attributable to the application of the quality incentives for computed tomography under section 1834(p) of the Act shall not be taken into account for purposes of the budget neutrality calculation under the PFS.

To implement this provision, in the CY 2016 PFS proposed rule (80 FR 41716), we proposed to establish a new modifier to be used on claims that describes CT services furnished using equipment that does not meet each of the attributes of the NEMA Standard XR-29-2013. We proposed that, beginning January 1, 2016, hospitals and suppliers would be required to use this modifier on claims for CT scans described by any of the CPT codes identified in this section (and any successor codes) that are furnished on non-NEMA Standard XR-29-2013-compliant CT scans. We stated that the use of this proposed modifier would result in the applicable payment reduction for the CT service, as specified under section 1834(p) of the Act. We received the following comments on our proposal to require the modifier to be used on claims:

Many commenters endorsed the use of quality incentives to improve patient safety and optimize the use of radiation when providing CT diagnostic imaging services. Several commenters were supportive of the proposal to establish the modifier to identify CT services furnished using equipment that does not meet each of the attributes of the NEMA Standard XR-29-2013.

Comment: Several commenters requested that we delay implementation of section 1834(p) of the Act so that they have additional time to comply before the payment reduction becomes effective.

Response: The statute requires that we apply the payment adjustment for computed tomography services furnished on or after January 1, 2016. Given this language, we believe that we must implement this provision beginning January 1, 2016. Therefore, we are not delaying implementation of this provision. We note that the payment reduction for 2016 is 5 percent, and it then increases to 15 percent in subsequent years. Hospitals and suppliers that furnish services that do not meet the equipment standard as of January 1, 2016, will receive this 5 percent payment reduction during 2016, but will have an opportunity to upgrade their CT scanners before the larger payment adjustment that takes effect beginning in CY 2017.

Comment: One commenter cited section 1834 (p)(4) of the Act, which specifies that through rulemaking, the Secretary may apply successor standards for CT equipment. The commenter indicated that CMS should develop successor standards that exempt CT scans performed on cone beam CT (CBCT) scanners that are FDA cleared only for imaging of the head from the requirement for Automatic Exposure Control (AEC) capability. This request was based on the AEC capability being unavailable on CBCT scanners.

Response: Although we agree with the commenter that the Secretary has authority to apply successor standards for CT equipment through notice and comment rulemaking, we would like to gain some experience with the NEMA Standard XR-29-2013 before adopting a successor standard. Therefore, we are not adopting a successor standard to the NEMA Standard XR-29-2013 in this final rule with comment period, but may consider doing so in future rulemaking.

After consideration of the public comments we received, we are finalizing the establishment of new modifier, “CT.” This 2-digit modifier will be added to the HCPCS annual file as of January 1, 2016, with the label “CT,” and the long descriptor “Computed tomography services furnished using equipment that does not meet each of the attributes of the National Electrical Manufacturers Association (NEMA) XR-29-2013 standard”.

Beginning January 1, 2016, hospitals and suppliers will be required to report the modifier “CT” on claims for CT scans described by any of the CPT codes identified in this section (and any successor codes) that are furnished on non-NEMA Standard XR-29-2013-compliant CT scanners. The use of this modifier will result in the applicable payment reduction for the CT service, as specified under section 1834(p) of the Act.

H. Valuation of Specific Codes

1. Background

Establishing valuations for newly created and revised CPT codes is a routine part of maintaining the PFS. Since inception of the PFS, it has also been a priority to revalue services regularly to assure that the payment rates reflect the changing trends in the practice of medicine and current prices for inputs used in the PE calculations. Initially, this was accomplished primarily through the five-year review process, which resulted in revised work RVUs for CY 1997, CY 2002, CY 2007, and CY 2012, and revised PE RVUs in CY 2001, CY 2006, and CY 2011. Under the five-year review process, revisions in RVUs were proposed in a proposed rule and finalized in a final rule. In addition to the five-year reviews, in each year beginning with CY 2009, CMS and the RUC have identified a number of potentially misvalued codes using various identification screens, as discussed in section II.B.5. of this final rule with comment period. Each year, when we received RUC recommendations, our process has been to establish interim final RVUs for the potentially misvalued codes, new codes, and any other codes for which there were coding changes in the final rule with comment period for a year. Then, during the 60-day period following the publication of the final rule with comment period, we accept public comment about those valuations.

For services furnished during the calendar year following the publication of interim final rates, we pay for services based upon the interim final values established in the final rule with comment period. In the final rule with comment period for the subsequent year, we consider and respond to public comments received on the interim final values, and make any appropriate adjustments to values based on those comments. We then typically finalize the values for the codes.Start Printed Page 70932

2. Process for Valuing New, Revised, and Potentially Misvalued Codes

In the CY 2015 PFS final rule with comment period, we finalized a new process for establishing values for new, revised and potentially misvalued codes. Under the new process, we include proposed values for these services in the proposed rule, rather than establishing them as interim final in the final rule with comment period. CY 2016 represents a transition year for this new process. For CY 2016, we proposed new values in the CY 2016 proposed rule for the codes for which we received complete RUC recommendations by February 10, 2015. For recommendations regarding any new or revised codes received after the February 10, 2015 deadline, including updated recommendations for codes included in the CY 2016 proposed rule, we are establishing interim final values in this final rule with comment period, consistent with previous practice. In this final rule with comment period, we considered all comments received in response to proposed values for codes in our proposed rule, including alternative recommendations to those used in developing the proposed rule.

Beginning with valuations for CY 2017, the new process will be applicable to all codes. That is, beginning with rulemaking for CY 2017, we will propose values for the vast majority of new, revised, and potentially misvalued codes and consider public comments before establishing final values for the codes; use G-codes as necessary to facilitate continued payment for certain services for which we do not receive recommendations in time to propose values; and adopt interim final values in the case of wholly new services for which there are no predecessor codes or values and for which we do not receive recommendations in time to propose values.

For CY 2016, we received RUC recommendations prior to February 10, 2015 for many new, revised and potentially misvalued codes and are establishing final values for those codes in this final rule with comment period. However, the RUC recommendations included CPT tracking codes instead of the actual 2016 CPT codes, which were first made available to the public subsequent to the publication of the CY 2016 proposed rule with comment period. Because CPT procedure codes are 5 alpha-numeric characters but CPT tracking codes typically have 6 or 7 alpha-numeric characters and CMS systems only utilize 5-character HCPCS codes, we developed and used alternative 5-character placeholder codes for use in the proposed rule. The final CPT codes are included and used for purposes of discussion in this final rule with comment period. Table 9 lists the CPT tracking codes, the CMS placeholder codes, and the final CPT codes for all new CPT codes included in the CY 2016 PFS proposed rule.

Table 9—2016 Final Rule HCPCS Placeholder to CPT Code Numbers

CPT Tracking codeCMS Placeholder codeCPT 2016Short descriptor
3160X13160A31652Bronch ebus samplng 1/2 node.
3160X23160B31653Bronch ebus samplng 3/> node.
3160X33160C31654Bronch ebus ivntj perph les.
3347X13347A33477Implant tcat pulm vlv perq.
3725X13725A37252Intrvasc us noncoronary 1st.
3725X23725B37253Intrvasc us noncoronary addl.
3940X13940A39401Mediastinoscpy w/medstnl bx.
3940X23940B39402Mediastinoscpy w/lmph nod bx.
5039X15039A50430Njx px nfrosgrm &/urtrgrm.
5039X25039B50431Njx px nfrosgrm &/urtrgrm.
5039X35039C50432Plmt nephrostomy catheter.
5039X45039D50433Plmt nephroureteral catheter.
5039X135039M50434Convert nephrostomy catheter.
5039X55039E50435Exchange nephrostomy cath.
5069X75069G50693Plmt ureteral stent prq.
5069X85069H50694Plmt ureteral stent prq.
5069X95069I50695Plmt ureteral stent prq.
5443X15443A54437Repair corporeal tear.
5443X25443B54438Replantation of penis.
657XX7657XG65785Impltj ntrstrml crnl rng seg.
692XXX692XX69209Remove impacted ear wax uni.
7208X17208A72081X-ray exam entire spi 1 vw.
7208X27208B72082X-ray exam entire spi 2/3 vw.
7208X37208C72083X-ray exam entire spi 4/5 vw.
7208X47208D72084X-ray exam entire spi 6/> vw.
7778X17778A77767Hdr rdncl skn surf brachytx.
7778X27778B77768Hdr rdncl skn surf brachytx.
7778X37778C77770Hdr rdncl ntrstl/icav brchtx.
7778X47778D77771Hdr rdncl ntrstl/icav brchtx.
7778X57778E77772Hdr rdncl ntrstl/icav brchtx.
8835X08835X88350Immunofluor antb addl stain.
9254X19254A92537Caloric vstblr test w/rec.
9254X29254B92538Caloric vstblr test w/rec.
99176X9917X99177Ocular instrumnt screen bil.
9935XX19935A99415Prolong clincl staff svc.
9935XX29935B99416Prolong clincl staff svc add.
GXXX1GXXX1G0296Visit to determ ldct elig.
GXXX2GXXX2G0297Ldct for lung ca screen.
Start Printed Page 70933

3. Methodology for Establishing Work RVUs

We conducted a review of each code identified in this section and reviewed the current work RVU (if any), RUC-recommended work RVU, intensity, time to furnish the preservice, intraservice, and postservice activities, as well as other components of the service that contribute to the value. Our review of recommended work RVUs and time generally includes, but is not limited to, a review of information provided by the RUC, 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, as well as Medicare claims data. We also assessed the methodology and data used to develop the recommendations submitted to us by the RUC and other public commenters and the rationale for the recommendations. In the CY 2011 PFS final rule with comment period (75 FR 73328 through 73329), we discussed 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. More information on these issues is available in that rule. When referring to a survey, unless otherwise noted, we mean the surveys conducted by specialty societies as part of the formal 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 building block components could be the CPT codes that make up the bundled code and the inputs associated with those codes. Magnitude estimation refers to a methodology for valuing work that determines the appropriate work RVU for a service by gauging the total amount of work for that service relative to the work for a similar service across the PFS without explicitly valuing the components of that work. In addition to these methodologies, CMS has frequently utilized an incremental methodology in which we value a code based upon its incremental difference between another code or another family of codes. Since the statute specifically defines the work component as the resources in time and intensity required in furnishing the service and the published literature on valuing work has recognized the key role of time in overall work, we have also refined the work RVUs for particular codes in direct proportion to the changes in the best information regarding the time resources involved in furnishing particular services, either considering the total time or the intra-service time.

Comment: Several commenters objected to CMS' use of these methodologies as unprecedented and invalid in the context of the development of PFS RVUs.

Response: We appreciate that many commenters, including the RUC, have maintained that magnitude estimation, informed by survey results, is the only appropriate method for valuation of PFS services. However, we have observed that the approaches used by the RUC in developing recommended work RVUs have resulted in recommended values that do not adequately address significant changes in assumptions regarding the amount of time required to furnish particular PFS services. Since section 1848(c)(1)(A) of the Act explicitly identifies time as one of the two kinds of resources that comprise the work component of PFS payment, we do not believe that our use of the above methodologies is inconsistent with the statutory requirements related to the maintenance of work RVUs, and we have regularly used these and other methodologies in developing values for PFS services. 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. In our review of RUC-recommended values, we have noted that the RUC also uses a variety of methodologies to develop work RVUs for individual services, and subsequently validates the results of these approaches through magnitude estimation. We believe that our discrete use of methodologies that compare the time resources among PFS codes is fundamentally similar to that approach, but better facilitates our ability to identify the most accurate work RVU for individual services by explicitly considering the significance of time in the estimate of total work.

Several years ago, to aid in the development of preservice time recommendations for new and revised CPT codes, the 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 three 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 value services appropriately when they have common billing patterns. In cases where a service is typically furnished to a beneficiary on the same day as an 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 work 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 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 multiplied by 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. The RUC has recognized this valuation policy and, in many cases, now addresses the overlap in time and work when a service is typically provided on the same day as an E/M service.

Table 13 contains a list of codes for which we proposed work RVUs; this includes all RUC recommendations received by February 10, 2015. When the proposed work RVUs varied from those recommended by the RUC or for which we do not have RUC Start Printed Page 70934recommendations, we address those codes in the portions of this section that are dedicated to particular codes. The work RVUs and other payment information for all CY 2016 payable codes are available in Addendum B. Addendum B is available on the CMS Web site under downloads for the CY 2016 PFS final rule with comment period at http://www.cms.gov/​physicianfeesched/​downloads/​. The time values for all CY 2016 codes are listed in a file called “CY 2016 PFS Work Time,” available on the CMS Web site under downloads for the CY 2016 PFS final rule with comment period at http://www.cms.gov/​physicianfeesched/​downloads/​.

4. Methodology for Establishing the Direct PE Inputs Used To Develop PE RVUs

a. Background

On an annual basis, the RUC provides CMS with recommendations regarding PE inputs for new, revised, and potentially misvalued codes. We review the RUC-recommended direct PE inputs on a code-by-code basis. Like our review of recommended work RVUs, our review of recommended direct PE inputs generally includes, but is not limited to, a review of information provided by the RUC, 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, as well as Medicare claims data. We also assess the methodology and data used to develop the recommendations submitted to us by the RUC and other public commenters and the rationale for the recommendations. When we determine that the RUC recommendations appropriately estimate the direct PE inputs (clinical labor, disposable supplies, and medical equipment) required for the typical service, consistent with the principles of relativity, and reflect our payment policies, we use those direct PE inputs to value a service. If not, we refine the recommended 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.

Our review and refinement of RUC-recommended direct PE inputs includes many refinements that are common across codes as well as refinements that are specific to particular services. Table 16 details our refinements of the RUC's direct PE recommendations at the code-specific level. In this final rule with comment period, we address several refinements that are common across codes, and refinements to particular codes are addressed in the portions of this section that are dedicated to particular codes. We note that for each refinement, we indicate the impact on direct costs for that service. We note that, on average, in any case where the impact on the direct cost for a particular refinement is $0.32 or less, the refinement has no impact on the interim final PE RVUs. This calculation considers both the impact on the direct portion of the PE RVU, as well as the impact on the indirect allocator for the average service. We also note that nearly half of the refinements listed in Table 14 result in changes under the $0.32 threshold and are unlikely to result in a change to the final RVUs.

We also note that the final direct PE inputs for CY 2016 are displayed in the final CY 2016 direct PE input database, available on the CMS Web site under the downloads for the CY 2016 final rule at www.cms.gov/​PhysicianFeeSched/​. The inputs displayed there have also been used in developing the CY 2016 PE RVUs as displayed in Addendum B of this final rule.

b. Common Refinements

(1) Changes in Work Time

Some direct PE inputs are directly affected by revisions in work time. Specifically, changes in the intraservice portions of the work time and changes in the number or level of postoperative visits associated with the global periods result in corresponding changes to direct PE inputs. Although the direct PE input recommendations generally correspond to the work time values associated with services, we believe that in some cases inadvertent discrepancies between work time values and direct PE inputs should be refined in the establishment of interim final direct PE inputs. In other cases, CMS refinement of RUC-recommended work times prompts necessary adjustments in the direct PE inputs.

We proposed to remove the 6 minutes of clinical labor time allotted to “discharge management, same day (0.5 × 99238)” in the facility setting from a number of procedures under review. We proposed to align the clinical labor for discharge day management to align the work time assigned in the work time file. We made these proposed refinements under the belief that we should not allocate clinical labor staff time for discharge day management if there is no discharge visit included in the procedure's global period.

Comment: Several commenters, including the RUC, disagreed with CMS and suggested that the clinical staff time in the facility setting may not conform with work time for discharge day management in a given code. Commenters stated that the work discharge time reflects the work involved in discharging from a facility setting. Therefore, if the service is typically performed in the nonfacility setting, the post-service time for a CPT code 99238 discharge visit would not be included. However, since the inputs for PE are differentiated by site of service, the time for discharge day might be included in the facility inputs, even if the service is infrequently provided in the facility setting overall. Although the commenters agreed that there should not be clinical staff time for discharge management assigned to 0-day global procedures, the commenters requested that this clinical staff time be restored for the nine 10-day global procedures under review. Commenters stressed that clinical staff must instruct the patient regarding home care prior to the post-operative visit and call in any necessary prescriptions. Commenters also requested that this clinical labor time be included as two, 3-minute phone calls under the task “Conduct phone calls/call in prescriptions.”

Response: We understand and agree that when cases typically performed in the non-facility setting are performed in the facility setting, discharge day management may not be typical for the code overall even if discharge day management activities may be typical when the service is furnished in the facility setting. However, we also believe that if a patient's conditions are serious enough to warrant treatment in the facility setting, then it is likely that the patient will also be receiving additional services that already include the resource costs involved with clinical labor tasks associated with discharge day management. Therefore, we do not believe that it is appropriate to include the additional time for staff phone calls for these services generally furnished in the office setting.

We have thus far been addressing the subject of discharge day management on a code-by-code basis. Based on the comments received, we believe there is a need for a broader policy concerning the proper treatment of this issue. We will consider this subject for future rulemaking.

After consideration of the comments received, we are finalizing our current Start Printed Page 70935refinements to discharge day management clinical labor time.

(2) Equipment Time

Prior to CY 2010, the 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 RUC provide equipment times along with the other direct PE recommendations, and we provided the RUC with general guidelines regarding appropriate equipment time inputs. We continue to appreciate the RUC's willingness to provide us with these additional inputs as part of its 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 time 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 those services for which we allocate cleaning time to portable equipment items, because the portable equipment does not need to be cleaned in the room where the service is furnished, we do not include that cleaning time for the remaining equipment items as those items and the room are both available for use for other patients during that time. In addition, when a piece of equipment is typically used during follow-up post-operative visits included in the global period for a service, 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 pre-service or post-service 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 the clinical staff may be occupied with a pre- service or post-service task related to the procedure. We also note that we believe these same assumptions would apply to inexpensive equipment items that are used in conjunction with and located in a room with non-portable highly technical equipment items. Some stakeholders have objected to this rationale for our refinement of equipment minutes on this basis and have reiterated these objections in comments regarding the proposed direct PE inputs. We are responding to these comments by referring the commenters to our extensive discussion in response to the same objections in the CY 2012 PFS final rule with comment period (76 FR 73182) and the CY 2015 PFS final rule with comment period (79 FR 67639).

(3) Standard Tasks and Minutes for Clinical Labor Tasks

In general, the preservice, intraservice 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 RUC-recommended direct PE inputs, commonly called the “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. The RUC sometimes recommends a number of minutes either greater than or less than the time typically allotted for certain tasks. In those cases, CMS staff reviews the deviations from the standards and any rationale provided for the deviations. When we do not accept the RUC-recommended exceptions, we refine the proposed direct PE inputs to conform to the standard times for those tasks. In addition, in cases when a service is typically billed with an E/M service, we remove the pre-service clinical labor tasks to avoid duplicative inputs and to 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.” We believe that continual addition of new and distinct clinical labor tasks each time a code is reviewed under the misvalued code initiative is likely to degrade relativity between newly reviewed services and those with already existing inputs. To mitigate the potential negative impact of these additions, we review these tasks to determine whether they are fully distinct from existing clinical labor tasks, typically included for other clinically similar services under the PFS, and thoroughly explained in the recommendation. For those tasks that do not meet these criteria, we do not accept these newly recommended clinical labor tasks; two examples of such tasks encountered during our review of the recommendations include “Enter data into laboratory information system, multiparameter analyses and field data entry, complete quality assurance documentation” and “Consult with pathologist regarding representation needed, block selection and appropriate technique.”

In conducting our review of the RUC recommendations for CY 2016, we noted that several of the recommended times for clinical labor tasks associated with pathology services differed across codes, both within the CY 2016 recommendations and in comparison to codes currently in the direct PE database. We refer readers to Table 16 in section II.A.3. of this final rule with comment period for a discussion of these standards.

Comment: Several commenters stated that our standard clinical labor inputs for digital imaging inputs for many different codes do not reflect the accurate number of minutes associated with clinical labor tasks for individual services.

Response: In the CY 2015 PFS final rule with comment period (79 FR 67561), we finalized the transition from film-based to digital direct PE inputs for imaging services. In the CY 2016 PFS proposed rule, we sought comment on the appropriate values for the clinical labor tasks associated with digital imaging. Please see section II.B. of this rule for a discussion of those policies. We believe that adherence to these standards produces the most accurate estimate of the resource costs for these kinds of tasks and supports relativity within the development of PE RVUs. For these reasons, absent extenuating factors for specific codes, we are finalizing interim final direct PE inputs that adhere to these standards.

(4) Recommended Items That Are Not Direct PE Inputs

In some cases, the PE worksheets included with the RUC recommendations include items that are not clinical labor, disposable supplies, or medical equipment that cannot be allocated to individual services or patients. Two examples of such items are “emergency service container/safety kit” and “service contract.” We have addressed these kinds of recommendations in previous rulemaking (78 FR 74242), and we do not use these recommended items as direct PE inputs in the calculation of PE RVUs.

(5) Moderate Sedation Inputs

Over several rulemaking cycles, we have proposed and finalized a standard package of direct PE inputs for services where moderate sedation is considered inherent in the procedure (76 FR 73043 through 73049). Our CY 2016 proposed direct PE inputs conform to these policies. This includes not Start Printed Page 70936incorporating the recommended power table (EF031) where it was included during the intraservice period, since a stretcher is the standard item in the moderate sedation package. These refinements are reflected in the final CY 2016 PFS direct PE input database and detailed in Table 16.

Comment: One commenter agreed with CMS' proposal to include the use of a stretcher in the standard moderate sedation package, and that the time allocated for the stretcher should be the entire post procedure recovery period. The commenter recommended that CMS work with the RUC and specialty groups before removing the power table input from the service period of any codes.

Response: We appreciate the commenter's support for the standard moderate sedation package, but we do not believe we should consult with the RUC prior to implementing the standards in developing or finalizing direct PE inputs. However, will consider the appropriate direct PE inputs for each code under review.

(6) New Supply and Equipment Items

The RUC generally recommends the use of supply and equipment items that already exist in the direct PE input database for new, revised, and potentially misvalued codes. Some recommendations include supply or equipment items that are not currently in the direct PE input database. In these cases, the RUC has historically recommended that a new item be created and has facilitated our pricing of that item by working with the specialty societies to provide us copies of sales invoices. For CY 2016, we received invoices for several new supply and equipment items. We have accepted the majority of these items and added them to the direct PE input database. Tables 18 and 19 detail the invoices received for new and existing items in the direct PE database. As discussed in section II.A. of this final rule with comment period, we encourage stakeholders to review the prices associated with these new and existing items to determine whether these prices appear to be accurate. Where prices appear inaccurate, we encourage stakeholders to provide invoices or other information to improve the accuracy of pricing for these items in the direct PE database. We remind stakeholders that due to the relativity inherent in the development of RVUs, reductions in existing prices for any items in the direct PE database increase the pool of direct PE RVUs available to all other PFS services. Tables 18 and 19 also include the number of invoices received as well as the number of nonfacility allowed services for procedures that use these equipment items. We provide the nonfacility allowed services so that stakeholders will note the impact the particular price might have on PE relativity, as well as to identify items that are used frequently, since we believe that stakeholders are more likely to have better pricing information for items used more frequently. We are concerned that a single invoice may not be reflective of typical costs and encourage stakeholders to provide additional invoices so that we might identify and use accurate prices in the development of PE RVUs.

In some cases, we do not use the price listed on the invoice that accompanies the recommendation because we identify publicly available alternative prices or information that suggests a different price is more accurate. In these cases, we include this in the discussion of these codes. In other cases, we cannot adequately price a newly recommended item due to inadequate information. Sometimes, no supporting information regarding the price of the item has been included in the recommendation. In other cases, the supporting information does not demonstrate that the item has been purchased at the listed price (for example, vendor price quotes instead of paid invoices). In cases where the information provided on the item allows us to identify clinically appropriate proxy items, we might use existing items as proxies for the newly recommended items. In other cases, we have included the item in the direct PE input database without any associated price. Although including the item without an associated price means that the item does not contribute to the calculation of the proposed PE RVU for particular services, it facilitates our ability to incorporate a price once we obtain information and are able to do so.

The following is a summary of the comments we received regarding new supply and equipment items.

Comment: Several commenters stated that they had concerns regarding the process of pricing new supply and equipment items for the PFS. The current process requires the submission of recently paid invoices for CMS to consider pricing a new direct PE item. The commenters asked CMS to develop a new pathway to submit pricing information that will protect physicians and vendors, since publishing copies of paid invoices, even when redacted, does not sufficiently protect private identities.

Response: We share commenters' concerns about protecting the privacy of practitioners and vendors during invoice submission. We welcome and will consider additional feedback and suggestions submitted by stakeholders regarding alternate avenues to provide updated pricing information for individual supplies and equipment.

Comment: A commenter stated that although the commenter understands that CMS cannot accurately value the typical cost of a supply or equipment if the agency is not provided with sufficient pricing information, they disagreed with CMS' decision to list the item in question in the direct PE database without assigning any value to it, as this can significantly affect the overall PE value for that service. The commenter requested that CMS highlight those cases where the price of a supply or equipment item is not being finalized due to inadequate documentation, so that there is an opportunity to provide additional resources that might assist in assigning an accurate value.

Response: We agree with the commenter that a lack of sufficient pricing information can often be problematic in assigning an accurate value to new supplies and equipment. Although we do not specifically identify all such items in the preamble to PFS rules, we note that stakeholders can easily identify items without prices in the direct PE input database files that are included as downloads with each PFS rule. We urge the public to submit a comment alerting us to items without a price that appear to be errors in the database. As detailed above, we also encourage the submission of invoices to help provide up-to-date, accurate pricing information for medical supplies and equipment.

Comment: A commenter wrote to express concern with the pricing of three supplies: Probe, radiofrequency, three array (StarBurstSDE) (SD109) from $1995 to $353.44; gas, helium (SD079) from 25 cents per cubic foot to one cent per cubic foot; and gas, argon (SD227) from 25 cents per cubic foot to less than one cent per cubic foot. The commenter added that there was no evidence that supported lower prices for these supplies, and urged CMS to retain the existing pricing for these supply items. The commenter stated that CMS' concerns regarding the price of these supplies were not addressed in the proposed rule, which did not allow opportunity for public comment.

Response: The prices of these three supplies were updated in response to invoices received during the previous calendar year. We appreciate the commenters' feedback and we recognize that it would have been easier for stakeholders to identify the prices had they been included on the Invoices Start Printed Page 70937Received for Existing Direct PE Inputs table in the proposed rule. We believe that the commenter may have been mistaken about the pricing of supplies SD079 and SD227. Both of these supplies have increased in price, from 25 cents per cubic foot to 57 cents and 32 cents per cubic foot, respectively. Neither supply has been lowered in price to one cent per cubic foot. Absent better data sources, we continue to believe that the supply prices listed in the public use files for the CY 2016 PFS proposed rule are the most accurate values for these items.

Comment: Many commenters wrote to express their concern over the pricing of the radiofrequency generator (NEURO) (EQ214) equipment affecting CPT codes 41530, 43228, 43229, 43270, 64633, 64634, 64635 and 64636. Commenters indicated that the invoice for this new equipment item was submitted in relation to CPT code 41530, and the equipment is not the same radiofrequency generator used to perform the services described by CPT codes 64633, 64634, 64635 and 64636. Commenters requested that the equipment input represented in the invoice be assigned an equipment code separate from existing code EQ214 and that CMS maintain the current price of $32,900 for EQ214.

Response: We appreciate the additional information provided by commenters regarding the pricing of the radiofrequency generator equipment. After consideration of comments received, we will create a new equipment code for the radiofrequency generator described in the submitted invoice, and assign this equipment to CPT codes 41530, 43228, 43229, and 43270. For CPT codes 64633, 64634, 64635, and 64636, we will maintain the current price of $32,900 for EQ214 and maintain this equipment.

Comment: One commenter submitted additional invoices regarding the pricing of the PrePen (SH103) supply. The commenter requested that CMS update the price of the PrePen to $92 based on an average of the four invoices submitted.

Response: We appreciate the commenter's submission of additional pricing information regarding the PrePen supply. We note that three of the four submitted invoices reported a price of $86 for supply item “PrePen” (SH103); we believe that this represents the typical price of this supply.

Therefore, after consideration of the comments received, we are increasing the price of supply SH103 from $83 to $86.

(7) Service Period Clinical Labor Time in the Facility Setting

Several of the PE worksheets included in RUC recommendations contained clinical labor minutes assigned to the service period in the facility setting. Our proposed inputs did not include these minutes because the cost of clinical labor during the service period for a procedure in the facility setting is not considered a resource cost to the practitioner since Medicare makes separate payment to the facility for these costs. We received no general comments that addressed this issue; we will address code-specific refinements to clinical labor in the individual code sections.

(8) Duplicative Inputs

Several of the PE worksheets included in the RUC recommendations contained time for the equipment item “xenon light source” (EQ167). Because there appear to be two special light sources already present (the fiberoptic headlight and the endoscope itself) in the services for which this equipment item was recommended by the RUC, we did not propose to include the time for this equipment item from these services. In the proposed rule, we solicited comments on whether there is a rationale for including this additional light source as a direct PE input for these procedures.

The following is a summary of the comments we received.

Comment: One commenter stated that if CMS believes two light sources are duplicative for these procedures, the commenter recommended retaining input EQ167 and removing input EQ170 (the fiberoptic headlight), as the xenon light source is compatible with various items and can serve as the light source throughout the procedures.

Response: We appreciate the additional information from the commenter regarding the appropriate use of these two light sources.

After consideration of comments received, we are restoring input EQ167 and removing input EQ170 with the same number of equipment minutes for CPT codes 30300, 31295, 31296, 31297, and 92511.

(9) Identification of Database Errors

Several commenters identified possible errors in the direct PE database that did not apply to CPT codes under review. The following is a summary of the comments we received regarding potential database entry errors.

Comment: A commenter located a potential error for CPT code 33262 (Removal of implantable defibrillator pulse generator with replacement of implantable defibrillator pulse generator; single lead system) where the PE RVU dropped from 3.68 in 2015 to 2.35 in the CY 2016 PFS proposed rule. The commenter pointed out that no changes were made to the direct PE inputs for the code, and similar codes within the same family retained the same PE value. The commenter recommended that CMS review this PE RVU and make a correction in the final rule.

Response: For CPT code 33262, the pre-existing direct PE inputs for this code were inadvertently not included in the development of the CY 2016 PFS proposed direct PE input database . We believe this was the result of a data error, and therefore, we are restoring the direct PE inputs to this service.

Comment: One commenter indicated that the underlying line item direct inputs for a series of CPT codes were missing from the individual labor, equipment, and supply public use files. The commenter provided a list of the ten codes affected by this issue, and asked whether this was the result of a technical error.

Response: The ten codes in question were all procedures that the CPT Editorial Panel has assigned for deletion in CY 2016. These codes appeared in error in our public use files for the CY 2016 PFS proposed rule. We have identified the technical issue that was causing this error and corrected it in the CY 2016 final direct PE input database.

Comment: One commenter identified a group of codes where the calculated clinical labor costs (based on the underlying direct input labor file) differed from the CMS summary labor findings. The commenter asked if there were instances where CMS was applying different labor inputs from those published in the files released with the rule.

Response: We appreciate the commenter bringing this issue regarding conflicting information in the CY 2016 PFS proposed rule public use files to our attention. This discrepancy was caused by an error in the creation of the public use files that undercounted the number of clinical labor minutes assigned to the postoperative E/M visits assigned to codes with 10-day and 90-day global periods. This error did not affect the proposed rates in the proposed rule, only the displayed values in the “labor task detail” public use file. We have corrected this issue in the public use files for the CY 2016 final direct PE input database.

Comment: A commenter indicated that for several codes, the CMS file for work times did not appear to be updated Start Printed Page 70938with the RUC-approved times. In particular, the pre-evaluation time and immediate post-service time appeared to be missing from the CMS file.

Response: These incorrect work times have been corrected in the CY 2016 final direct PE input database.

(10) Procedures Subject to the Multiple Procedure Payment Reduction (MPPR) and the OPPS Cap

We note that services subject to the MPPR lists on diagnostic cardiovascular services, diagnostic imaging services, diagnostic ophthalmology services and therapy services, and the list of procedures that meet the definition of imaging under section 5102(b) of the DRA and are therefore subject to the OPPS cap for the upcoming calendar year are displayed in the public use files for the PFS proposed and final rules for each year. The public use files for CY 2016 are available on the CMS Web site under downloads for the CY 2016 PFS final rule with comment period at http://www.cms.gov/​Medicare-Fee-for-Service-Payment/​PhysicianFeeSched/​PFSFederal-Regulation-Notices.html.

5. Methodology for Establishing Malpractice RVUs

As discussed in section II.B. of this final rule with comment period, our malpractice methodology uses a crosswalk to establish risk factors for new services until utilization data becomes available. Table 10 lists the CY 2016 HCPCS codes and their respective source codes used to set the CY 2016 MP RVUs. The MP RVUs for these services are reflected in Addendum B on the CMS Web site at https://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​PhysicianFeeSched/​.

TABLE 10—CY 2016 Malpractice Crosswalk

CY 2016 new, revised or misvalued codeMalpractice risk factor crosswalk code
10035Perq Dev Soft Tiss 1St Imag19285Perq dev breast 1st us imag
10036Perq Dev Soft Tiss Add Imag19286Perq dev breast add us imag
26356Repair finger/hand tendon26356Repair finger/hand tendon
26357Repair finger/hand tendon26357Repair finger/hand tendon
26358Repair/graft hand tendon26358Repair/graft hand tendon
41530Tongue base vol reduction41530Tongue base vol reduction
43210Egd esophagogastrc fndoplsty43276Ercp stent exchange w/dilate
47531Injection For Cholangiogram49450Replace g/c tube perc
47540Perq Plmt Bile Duct Stent47556Biliary endoscopy thru skin
47541Plmt Access Bil Tree Sm Bwl47500Injection for liver x-rays
47542Dilate Biliary Duct/Ampulla47550Bile duct endoscopy add-on
47543Endoluminal Bx Biliary Tree47550Bile duct endoscopy add-on
47544Removal Duct Glbldr Calculi47630Remove bile duct stone
47532Injection For Cholangiogram49407Image cath fluid trns/vgnl
47533Plmt Biliary Drainage Cath47510Insert catheter bile duct
47534Plmt Biliary Drainage Cath47511Insert bile duct drain
47535Conversion Ext Bil Drg Cath47505Injection for liver x-rays
47536Exchange Biliary Drg Cath49452Replace g-j tube perc
47537Removal Biliary Drg Cath47505Injection for liver x-rays
47538Perq Plmt Bile Duct Stent47556Biliary endoscopy thru skin
47539Perq Plmt Bile Duct Stent47556Biliary endoscopy thru skin
49185Sclerotx Fluid Collection49407Image cath fluid trns/vgnl
50606Endoluminal Bx Urtr Rnl Plvs50955Ureter endoscopy & biopsy
50705Ureteral Embolization/Occl50393Insert ureteral tube
50706Balloon Dilate Urtrl Strix50395Create passage to kidney
55866Laparo radical prostatectomy55866Laparo radical prostatectomy
61645Perq Art M-Thrombect &/Nfs37218Stent placemt ante carotid
61650Evasc Prlng Admn Rx Agnt 1St37202Transcatheter therapy infuse
61651Evasc Prlng Admn Rx Agnt Add37202Transcatheter therapy infuse
64461Pvb Thoracic Single Inj Site64490Inj paravert f jnt c/t 1 lev
64462Pvb Thoracic 2Nd+ Inj Site64480Inj foramen epidural add-on
64463Pvb Thoracic Cont Infusion64446N blk inj sciatic cont inf
64553Implant neuroelectrodes64553Implant neuroelectrodes
64555Implant neuroelectrodes64555Implant neuroelectrodes
64566Neuroeltrd stim post tibial64566Neuroeltrd stim post tibial
65778Cover eye w/membrane65778Cover eye w/membrane
65779Cover eye w/membrane suture65779Cover eye w/membrane suture
65780Ocular reconst transplant65780Ocular reconst transplant
65855Trabeculoplasty Laser Surg65855Laser surgery of eye
66170Glaucoma surgery66170Glaucoma surgery
66172Incision of eye66172Incision of eye
67107Repair Detached Retina67107Repair detached retina
67108Repair Detached Retina67108Repair detached retina
67110Repair detached retina67110Repair detached retina
67113Repair Retinal Detach Cplx67113Repair retinal detach cplx
67227Dstrj Extensive Retinopathy67227Treatment of retinal lesion
67228Treatment X10Sv Retinopathy67228Treatment of retinal lesion
72170X-ray exam of pelvis72170X-ray exam of pelvis
73501X-Ray Exam Hip Uni 1 View72170X-ray exam of pelvis
73502X-Ray Exam Hip Uni 2-3 Views72170X-ray exam of pelvis
73503X-Ray Exam Hip Uni 4/> Views72170X-ray exam of pelvis
73521X-Ray Exam Hips Bi 2 Views72170X-ray exam of pelvis
73522X-Ray Exam Hips Bi 3-4 Views72170X-ray exam of pelvis
73523X-Ray Exam Hips Bi 5/> Views72170X-ray exam of pelvis
73551X-Ray Exam Of Femur 172170X-ray exam of pelvis
73552X-Ray Exam Of Femur 2/>72170X-ray exam of pelvis
74712Mri Fetal Sngl/1St Gestation72195Mri pelvis w/o dye
Start Printed Page 70939
CY 2016 new, revised or misvalued codeMalpractice risk factor crosswalk code
74713Mri Fetal Ea Addl Gestation72195Mri pelvis w/o dye
77778Apply Interstit Radiat Compl77778Apply interstit radiat compl
77790Radiation handling77790Radiation handling
78264Gastric Emptying Imag Study78264Gastric emptying study
78265Gastric Emptying Imag Study78264Gastric emptying study
78266Gastric Emptying Imag Study78264Gastric emptying study
91200Liver elastography91133Electrogastrography w/test
93050Art pressure waveform analys93784Ambulatory bp monitoring
95971Analyze neurostim simple95971Analyze neurostim simple
95972Analyze Neurostim Complex95972Analyze neurostim complex

6. CY 2016 Valuation of Specific Codes

Table 11—CY 2016 Work RVUs for New, Revised and Potentially Misvalued Codes With Proposed Values in the CY 2016 PFS Proposed Rule

HCPCS CodeLong descriptorCY 2015 WRVUProposed CY 2016 work RVUFinal CY 2016 work RVU
11750Excision of nail and nail matrix, partial or complete (eg, ingrown or deformed nail), for permanent removal;2.501.581.58
20240Biopsy, bone, open; superficial (eg, ilium, sternum, spinous process, ribs, trochanter of femur)3.282.612.61
27280Arthrodesis, open, sacroiliac joint, including obtaining bone graft, including instrumentation, when performed14.6420.0020.00
31652Bronchoscopy, rigid or flexible, including fluoroscopic guidance, when performed; with endobronchial ultrasound (EBUS) guided transtracheal and/or transbronchial sampling (eg, aspiration[s]/biopsy[ies]), one or two mediastinal and/or hilar lymph node statNEW4.714.71
31653Bronchoscopy, rigid or flexible, including fluoroscopic guidance, when performed; with endobronchial ultrasound (EBUS) guided transtracheal and/or transbronchial sampling (eg, aspiration[s]/biopsy[ies]), 3 or more mediastinal and/or hilar lymph node statiNEW5.215.21
31654Bronchoscopy, rigid or flexible, including fluoroscopic guidance, when performed; with transendoscopic endobronchial ultrasound (EBUS) during bronchoscopic diagnostic or therapeutic intervention(s) for peripheral lesion(s) (List separately in addition toNEW1.401.40
31622Bronchoscopy, rigid or flexible, including fluoroscopic guidance, when performed; diagnostic, with cell washing, when performed (separate procedure)2.782.782.78
31625Bronchoscopy, rigid or flexible, including fluoroscopic guidance, when performed; with bronchial or endobronchial biopsy(s), single or multiple sites3.363.363.36
31626Bronchoscopy, rigid or flexible, including fluoroscopic guidance, when performed; with placement of fiducial markers, single or multiple4.164.164.16
31628Bronchoscopy, rigid or flexible, including fluoroscopic guidance, when performed; with transbronchial lung biopsy(s), single lobe3.803.803.80
31629Bronchoscopy, rigid or flexible, including fluoroscopic guidance, when performed; with transbronchial needle aspiration biopsy(s), trachea, main stem and/or lobar bronchus(i)4.094.004.00
31632Bronchoscopy, rigid or flexible, including fluoroscopic guidance, when performed; with transbronchial lung biopsy(s), each additional lobe (List separately in addition to code for primary procedure)1.031.031.03
31633Bronchoscopy, rigid or flexible, including fluoroscopic guidance, when performed; with transbronchial needle aspiration biopsy(s), each additional lobe (List separately in addition to code for primary procedure)1.321.321.32
33477Transcatheter pulmonary valve implantation, percutaneous approach, including pre-stenting of the valve delivery site, when performedNEW25.0025.00
37215Transcatheter placement of intravascular stent(s), cervical carotid artery, open or percutaneous, including angioplasty, when performed, and radiological supervision and interpretation; with distal embolic protection19.6818.0018.00
37252Intravascular ultrasound (noncoronary vessel) during diagnostic evaluation and/or therapeutic intervention, including radiological supervision and interpretation; initial non-coronary vessel (List separately in addition to code for primary procedure)NEW1.801.80
37253Intravascular ultrasound (noncoronary vessel) during diagnostic evaluation and/or therapeutic intervention, including radiological supervision and interpretation; each additional noncoronary vessel (List separately in addition to code for primary procedureNEW1.441.44
38570Laparoscopy, surgical; with retroperitoneal lymph node sampling (biopsy), single or multiple9.348.498.49
Start Printed Page 70940
38571Laparoscopy, surgical; with bilateral total pelvic lymphadenectomy14.7612.0012.00
38572Laparoscopy, surgical; with bilateral total pelvic lymphadenectomy and peri-aortic lymph node sampling (biopsy), single or multiple16.9415.6015.60
39401Mediastinoscopy; includes biopsy(ies) of mediastinal mass (eg, lymphoma), when performedNEW5.445.44
39402Mediastinoscopy; with lymph node biopsy(ies) (eg, lung cancer staging)NEW7.257.25
43775Laparoscopy, surgical, gastric restrictive procedure; longitudinal gastrectomy (ie, sleeve gastrectomy)C20.3820.38
44380Ileoscopy, through stoma; diagnostic, including collection of specimen(s) by brushing or washing, when performed (separate procedure)1.050.900.97
44381Ileoscopy, through stoma; with transendoscopic balloon dilationI1.481.48
44382Ileoscopy, through stoma; with biopsy, single or multiple1.271.201.27
44384Ileoscopy, through stoma; with placement of endoscopic stent (includes pre- and post-dilation and guide wire passage, when performed)I2.882.95
44385Endoscopic evaluation of small intestinal pouch (e.g., Kock pouch, ileal reservoir [S or J]); diagnostic, including collection of specimen(s) by brushing or washing, when performed (separate procedure)1.821.231.30
44386Endoscopic evaluation of small intestinal pouch (eg, Kock pouch, ileal reservoir [S or J]); with biopsy, single or multiple2.121.531.60
44388Colonoscopy through stoma; diagnostic, including collection of specimen(s) by brushing or washing, when performed (separate procedure)2.822.752.82
44389Colonoscopy through stoma; with biopsy, single or multiple3.133.053.12
44390Colonoscopy through stoma; with removal of foreign body(s)3.823.773.84
44391Colonoscopy through stoma; with control of bleeding, any method4.314.224.22
44392Colonoscopy through stoma; with removal of tumor(s), polyp(s), or other lesion(s) by hot biopsy forceps3.813.633.63
44394Colonoscopy through stoma; with removal of tumor(s), polyp(s), or other lesion(s) by snare technique4.424.134.13
44401Colonoscopy through stoma; with ablation of tumor(s), polyp(s), or other lesion(s) (includes pre-and post-dilation and guide wire passage, when performed)I4.444.44
44402Colonoscopy through stoma; with endoscopic stent placement (including pre- and post-dilation and guide wire passage, when performed)I4.734.80
44403Colonoscopy through stoma; with endoscopic mucosal resectionI5.535.60
44404Colonoscopy through stoma; with directed submucosal injection(s), any substanceI3.053.12
44405Colonoscopy through stoma; with transendoscopic balloon dilationI3.333.33
44406Colonoscopy through stoma; with endoscopic ultrasound examination, limited to the sigmoid, descending, transverse, or ascending colon and cecum and adjacent structuresI4.134.20
44407Colonoscopy through stoma; with transendoscopic ultrasound guided intramural or transmural fine needle aspiration/biopsy(s), includes endoscopic ultrasound examination limited to the sigmoid, descending, transverse, or ascending colon and cecum and adjacent structuresI5.065.06
44408Colonoscopy through stoma; with decompression (for pathologic distention) (eg, volvulus, megacolon), including placement of decompression tube, when performedI4.244.24
45330Sigmoidoscopy, flexible; diagnostic, including collection of specimen(s) by brushing or washing, when performed (separate procedure)0.960.770.84
45331Sigmoidoscopy, flexible; with biopsy, single or multiple1.151.071.14
45332Sigmoidoscopy, flexible; with removal of foreign body(s)1.791.791.86
45333Sigmoidoscopy, flexible; with removal of tumor(s), polyp(s), or other lesion(s) by hot biopsy forceps1.791.651.65
45334Sigmoidoscopy, flexible; with control of bleeding, any method2.732.102.10
45335Sigmoidoscopy, flexible; with directed submucosal injection(s), any substance1.461.071.14
45337Sigmoidoscopy, flexible; with decompression (for pathologic distention) (e.g., volvulus, megacolon), including placement of decompression tube, when performed2.362.202.20
45338Sigmoidoscopy, flexible; with removal of tumor(s), polyp(s), or other lesion(s) by snare technique2.342.152.15
45340Sigmoidoscopy, flexible; with transendoscopic balloon dilation1.891.351.35
45341Sigmoidoscopy, flexible; with endoscopic ultrasound examination2.602.152.22
45342Sigmoidoscopy, flexible; with transendoscopic ultrasound guided intramural or transmural fine needle aspiration/biopsy(s)4.053.083.08
45346Sigmoidoscopy, flexible; with ablation of tumor(s), polyp(s), or other lesion(s) (includes pre- and post-dilation and guide wire passage, when performed)I2.842.91
45347Sigmoidoscopy, flexible; with placement of endoscopic stent (includes pre- and post-dilation and guide wire passage, when performed)I2.752.82
Start Printed Page 70941
45349Sigmoidoscopy, flexible; with endoscopic mucosal resectionI3.553.62
45350Sigmoidoscopy, flexible; with band ligation(s) (e.g., hemorrhoids)I1.781.78
45378Colonoscopy, flexible; diagnostic, including collection of specimen(s) by brushing or washing, when performed (separate procedure)3.693.293.36
45379Colonoscopy, flexible; with removal of foreign body(s)4.684.314.38
45380Colonoscopy, flexible; with biopsy, single or multiple4.433.593.66
45381Colonoscopy, flexible; with directed submucosal injection(s), any substance4.193.593.66
45382Colonoscopy, flexible; with control of bleeding, any method5.684.764.76
45384Colonoscopy, flexible; with removal of tumor(s), polyp(s), or other lesion(s) by hot biopsy forceps4.694.174.17
45385Colonoscopy, flexible; with removal of tumor(s), polyp(s), or other lesion(s) by snare technique5.304.674.67
45386Colonoscopy, flexible; with transendoscopic balloon dilation4.573.873.87
45388Colonoscopy, flexible; with ablation of tumor(s), polyp(s), or other lesion(s) (includes pre- and post-dilation and guide wire passage, when performed)I4.984.98
45389Colonoscopy, flexible; with endoscopic stent placement (includes pre- and post-dilation and guide wire passage, when performed)I5.275.34
45390Colonoscopy, flexible; with endoscopic mucosal resectionI6.076.14
45391Colonoscopy, flexible; with endoscopic ultrasound examination limited to the rectum, sigmoid, descending, transverse, or ascending colon and cecum, and adjacent structures5.094.674.74
45392Colonoscopy, flexible; with transendoscopic ultrasound guided intramural or transmural fine needle aspiration/biopsy(s), includes endoscopic ultrasound examination limited to the rectum, sigmoid, descending, transverse, or ascending colon and cecum, and adjacent structures6.545.605.60
45393Colonoscopy, flexible; with decompression (for pathologic distention) (e.g., volvulus, megacolon), including placement of decompression tube, when performedI4.784.78
45398Colonoscopy, flexible; with band ligation(s) (e.g., hemorrhoids)I4.304.30
46500Injection of sclerosing solution, hemorrhoids1.691.421.42
46601Anoscopy; diagnostic, with high-resolution magnification (HRA) (e.g., colposcope, operating microscope) and chemical agent enhancement, including collection of specimen(s) by brushing or washing, when performedI1.601.60
46607Anoscopy; with high-resolution magnification (HRA) (e.g., colposcope, operating microscope) and chemical agent enhancement, with biopsy, single or multipleI2.202.20
47135Liver allotransplantation; orthotopic, partial or whole, from cadaver or living donor, any age83.6490.0090.00
50430Injection procedure for antegrade nephrostogram and/or ureterogram, complete diagnostic procedure including imaging guidance (e.g., ultrasound and fluoroscopy) and all associated radiological supervision and interpretation; new accessNEW3.153.15
50431Injection procedure for antegrade nephrostogram and/or ureterogram, complete diagnostic procedure including imaging guidance (e.g., ultrasound and fluoroscopy) and all associated radiological supervision and interpretation; existing accessNEW1.101.10
50432Placement of nephrostomy catheter, percutaneous, including diagnostic nephrostogram and/or ureterogram when performed, imaging guidance (e.g., ultrasound and/or fluoroscopy) and all associated radiological supervision and interpretationNEW4.254.25
50433Placement of nephroureteral catheter, percutaneous, including diagnostic nephrostogram and/or ureterogram when performed, imaging guidance (e.g., ultrasound and/or fluoroscopy) and all associated radiological supervision and interpretation, new accessNEW5.305.30
50435Exchange nephrostomy catheter, percutaneous, including diagnostic nephrostogram and/or ureterogram when performed, imaging guidance (e.g., ultrasound and/or fluoroscopy) and all associated radiological supervision and interpretationNEW1.821.82
50434Convert nephrostomy catheter to nephroureteral catheter, percutaneous, including diagnostic nephrostogram and/or ureterogram when performed, imaging guidance (e.g., ultrasound and/or fluoroscopy) and all associated radiological supervision and interpretationNEW4.004.00
50693Placement of ureteral stent, percutaneous, including diagnostic nephrostogram and/or ureterogram when performed, imaging guidance (e.g., ultrasound and/or fluoroscopy) and all associated radiological supervision and interpretation; pre-existing nephrostomyNEW4.214.21
Start Printed Page 70942
50694Placement of ureteral stent, percutaneous, including diagnostic nephrostogram and/or ureterogram when performed, imaging guidance (e.g., ultrasound and/or fluoroscopy) and all associated radiological supervision and interpretation; new access, without separNEW5.505.50
50695Placement of ureteral stent, percutaneous, including diagnostic nephrostogram and/or ureterogram when performed, imaging guidance (e.g., ultrasound and/or fluoroscopy) and all associated radiological supervision and interpretation; new access, with separateNEW7.057.05
54437Repair of traumatic corporeal tear(s)NEW11.5011.50
54438Replantation, penis, complete amputation including urethral repairNEW22.1024.50
63045Laminectomy, facetectomy and foraminotomy (unilateral or bilateral with decompression of spinal cord, cauda equina and/or nerve root[s], [eg, spinal or lateral recess stenosis]), single vertebral segment; cervical17.9517.9517.95
63046Laminectomy, facetectomy and foraminotomy (unilateral or bilateral with decompression of spinal cord, cauda equina and/or nerve root[s], [eg, spinal or lateral recess stenosis]), single vertebral segment; thoracic17.2517.2517.25
65785Implantation of intrastromal corneal ring segmentsNEW5.395.39
68801Dilation of lacrimal punctum, with or without irrigation1.000.820.82
68810Probing of nasolacrimal duct, with or without irrigation2.151.541.54
68811Probing of nasolacrimal duct, with or without irrigation; requiring general anesthesia2.451.741.74
68815Probing of nasolacrimal duct, with or without irrigation; with insertion of tube or stent3.302.702.70
68816Probing of nasolacrimal duct, with or without irrigation; with transluminal balloon catheter dilation3.062.102.10
71100Radiologic examination, ribs, unilateral; 2 views0.220.220.22
72070Radiologic examination, spine; thoracic, 2 views0.220.220.22
72081Entire spine x ray, one viewNEW0.260.26
72082Entire spine x-ray; 2 or 3 viewsNEW0.310.31
72083Entire spine x-ray; 4 or 5 viewsNEW0.350.35
72084Entire spine x-ray; min 6 viewsNEW0.410.41
73060Radiologic examination; humerus, minimum of 2 views0.170.160.16
73560Radiologic examination, knee; 1 or 2 views0.170.160.16
73562Radiologic examination, knee; 3 views0.180.180.18
73564Radiologic examination, knee; complete, 4 or more views0.220.220.22
73565Radiologic examination, knee; both knees, standing, anteroposterior0.170.160.16
73590Radiologic examination; tibia and fibula, 2 views0.170.160.16
73600Radiologic examination, ankle; 2 views0.160.160.16
76999Unlisted ultrasound procedure (e.g., diagnostic, interventional)CCC
77385Intensity modulated radiation treatment delivery (IMRT), includes guidance and tracking, when performed; simpleI0.00I
77386Intensity modulated radiation treatment delivery (IMRT), includes guidance and tracking, when performed; complexI0.00I
77387Guidance for localization of target volume for delivery of radiation treatment delivery, includes intrafraction tracking, when performedI0.58I
77402Radiation treatment delivery, >= 1 MeV; simpleI0.00I
77407Radiation treatment delivery, >= 1 MeV; intermediateI0.00I
77412Radiation treatment delivery, >= 1 MeV; complexI0.00I
77767Remote afterloading high dose rate radionuclide skin surface brachytherapy, includes basic dosimetry, when performed; lesion diameter up to 2.0 cm or 1 channelNEW1.051.05
77768Remote afterloading high dose rate radionuclide skin surface brachytherapy, includes basic dosimetry, when performed; lesion diameter over 2.0 cm and 2 or more channels, or multiple lesionsNEW1.401.40
77770Remote afterloading high dose rate radionuclide interstitial or intracavitary brachytherapy, includes basic dosimetry, when performed; 1 channelNEW1.951.95
77771Remote afterloading high dose rate radionuclide interstitial or intracavitary brachytherapy, includes basic dosimetry, when performed; 2-12 channelsNEW3.803.80
77772Remote afterloading high dose rate radionuclide interstitial or intracavitary brachytherapy, includes basic dosimetry, when performed; over 12 channelsNEW5.405.40
88346Immunofluorescent study, each antibody; direct method0.860.740.74
88350Immunofluorescence, per specimen; each additional single antibody stain procedure (List separately in addition to code for primary procedure)NEW0.560.56
88367Morphometric analysis, in situ hybridization (quantitative or semi-quantitative), using computer-assisted technology, per specimen; initial single probe stain procedure0.730.730.73
88368Morphometric analysis, in situ hybridization (quantitative or semi-quantitative), manual, per specimen; initial single probe stain procedure0.880.880.88
Start Printed Page 70943
91299Unlisted diagnostic gastroenterology procedureCCC
92537Caloric vestibular test with recording, bilateral; bithermal (ie, one warm and one cool irrigation in each ear for a total of four irrigations)NEW0.600.60
92538Caloric vestibular test with recording, bilateral; monothermal (ie, one irrigation in each ear for a total of two irrigations)NEW0.300.30
99174Instrument-based ocular screening (e.g., photoscreening, automated-refraction), bilateralNNN
99177Instrument-based ocular screening (e.g., photoscreening, automated-refraction), bilateral; with on-site analysisNEWNN
99497Advance care planning including the explanation and discussion of advance directives such as standard forms (with completion of such forms, when performed), by the physician or other qualified health care professional; first 30 minutes, face-to-face with the patient, family member(s), and/or surrogateI1.501.50
99498Advance care planning including the explanation and discussion of advance directives such as standard forms (with completion of such forms, when performed), by the physician or other qualified health care professional; each additional 30 minutes (List separately in addition to code for primary procedure)I1.401.40
G0104Colorectal cancer screening; flexible sigmoidoscopy0.960.770.84
G0105Colorectal cancer screening; colonoscopy on individual at high risk3.693.293.36
G0121Colorectal cancer screening; colonoscopy on individual not meeting criteria for high risk3.693.293.36

a. Lower GI Endoscopy Services

CPT revised the lower gastrointestinal endoscopy code set for CY 2015 following identification of some of the codes as potentially misvalued and the affected specialty society's contention that this code set did not allow for accurate reporting of services based upon current medical practice. The RUC subsequently provided recommendations to us for valuing these services. In the CY 2015 PFS final rule with comment period, we delayed valuing the lower GI codes and indicated that we would propose values for these codes in the CY 2016 proposed rule, citing the new process for including proposed values for new, revised and potentially misvalued codes in the proposed rule as one of the reasons for the delay.

(1) Gastrointestinal (GI) Endoscopy (CPT Codes 43775, 44380-46607 and HCPCS Codes G0104, G0105, and G0121)

In the CY 2014 PFS final rule with comment period, we indicated that we used what we called an “incremental difference methodology” in valuing the upper GI codes for that year. We explained that the RUC made extensive use of a methodology that uses the incremental difference in codes to determine values for many of these services. This methodology uses a base code or other comparable code and considers what the difference should be between that code and another code by comparing the differentials to those for other sets of similar codes. As with the esophagoscopy subfamily, many of the procedures described within the colonoscopy subfamily have identical counterparts in the esophagogastroduodenoscopy (EGD) subfamily. For instance, the base colonoscopy CPT code 45378 is described as “Colonoscopy, flexible; diagnostic, including collection of specimen(s) by brushing or washing when performed, (separate procedure).” The base EGD CPT code 43235 is described as “Esophagogastroduodenoscopy, flexible, transoral; diagnostic, with collection of specimen(s) by brushing or washing, when performed.” In valuing other codes within both subfamilies, the RUC frequently used the difference between these two base codes as an increment for measuring the difference in work involved in doing a similar procedure utilizing colonoscopy versus utilizing EGD. For example, the EGD CPT code 43239 includes a biopsy in addition to the base diagnostic EGD CPT code 43235. The RUC valued this by adding the incremental difference in the base colonoscopy code over the base EGD CPT code to the value it recommended for the esophagoscopy biopsy, CPT code 43202. With some variations, the RUC used this incremental difference methodology extensively in valuing subfamilies of codes. In the CY 2016 PFS proposed rule, we made use of similar methodologies in establishing the proposed work RVUs for codes in this family.

We agreed with several of the RUC recommendations for codes in this family. Where we did not agree, we consistently applied the incremental difference methodology. Table 12 reflects how we applied this methodology and the values we proposed. To calculate the base RVU for the colonoscopy subfamily, we looked at the current intraservice time for CPT code 45378, which is 30 minutes, and the current work RVU, which is 3.69. The RUC recommended an intraservice time of 25 minutes and 3.36 RVUs. We then compared that service to the base EGD CPT code 43235 for which the RUC recommended a work RVU of 2.26, giving an increment between EGD and colonoscopy of 1.10 RVUs. We added that increment to our proposed work RVU for CPT code 43235 of 2.19 to arrive at our proposed work RVU for the base colonoscopy CPT code 45378 of 3.29. We used this value as the base code in the incremental methodology for establishing the proposed work RVU for the other base codes in the colonoscopy subfamilies which were then used to value the other codes in that subfamily.

Comment: Many commenters expressed concerns that the proposed values for the lower GI code set will hinder efforts to reduce the incidence of colorectal cancer through detection and treatment by limiting access to screenings. Comments stated, Start Printed Page 70944“According to a poll of more than 550 gastroenterologists, more than half of the respondents plan to limit new Medicare patients if the proposed cuts are implemented; 55 percent plan to limit procedures to Medicare patients; and 15 percent are considering opting out of Medicare entirely. These findings suggest that GI physicians may not be able to maintain the current mix of Medicare patients and protect the financial viability of their practices.” Some commenters specifically disagreed with CMS' methodology of applying an incremental difference between the base procedure for upper GI and lower GI, stating they believe that is a misapplication of the incremental approach and some noted that they believe that the upper and lower GI services are clinically distinct. Additionally, many commenters expressed disappointment that CMS did not consider the survey results, which they believe are the most reliable indicator of the work involved in colonoscopy. These commenters suggested that CMS adopt the RUC-recommended values for the lower GI code set. Additionally, the affected specialty societies suggested that we accept their original recommendations (a work RVU of 3.51 for the base colonoscopy code, CPT code 45378). Some commenters stated that new colorectal cancer screening protocols have resulted in increased work due to the attention required to identify and remove precancerous lesions.

Response: In developing the proposed work RVUs, we did consider the survey data. However, we considered the survey data in the context of the work RVUs for services within the broader endoscopy family. While we continue to believe that relativity among families of codes is important and view the upper and lower endoscopy codes as one code family, in the context of receiving many comments urging us to accept the RUC-recommended value for diagnostic colonoscopy (and thus the screening colonoscopy), we reconsidered the differences between the RUC-recommended value and our proposed RVUs. We do not believe the relatively small difference between these two values is itself likely to present significant issues in PFS relativity. Therefore, we agree with commenters that the RUC-recommended values generally reflect the work resources involved in furnishing the service and we are finalizing the RUC-recommended value of 3.36 RVUs for the base colonoscopy code, CPT code 45378, and are adjusting the valuation of all the other codes in the lower GI code set using that base with the incremental difference methodology. We also note that while we appreciate and share commenters' interest in maintaining beneficiaries' access to screening colonoscopies where appropriate under the current benefit, we believe that establishing RVUs that most accurately reflect the relative resource costs involved in furnishing services paid under the PFS is not only required by the statute, but also important to preserve and promote beneficiary access to all PFS services.

Comment: A few commenters requested that CMS delay finalizing values for the lower GI codes until codes that are used to report moderate sedation are separately valued, since implementation of those codes will require a methodology for removing the work RVUs for moderate sedation from the endoscopy codes.

Response: We will review and consider recommendations from the medical community about the work RVUs associated with moderate sedation and will address the valuation of moderation sedation separately. Since moderate sedation is a broad, cross-cutting issue that affects many specialties and code families, we do not believe that it is appropriate to delay finalizing values for all codes with moderate sedation, and therefore, will not do so for the GI codes.

Comment: A few commenters stated disagreement with CMS' proposed PE refinement to remove the mobile instrument table (EF027) from codes 45330 and 45331on the basis that the procedures do not include moderate sedation. The commenter noted that, “while the mobile instrument table is part of the moderate sedation standard package and moderate sedation is not inherent in the procedure, it is still a necessary part of flexible sigmoidoscopy codes 45330 and 45331.”

Response: We agree with the commenter that the mobile instrument table is typically involved in furnishing these services, even though moderate sedation may not be inherent in the procedure. Therefore, we have included the mobile instrument table (EF027) in the direct PE input database for codes 45330 and 45331.

Comment: We received a comment on the proposed PE refinements made to CPT code 45330, stating that the RUC approved sterile water for CPT code 43450 instead of distilled water due to the risk of infections and potential for contamination. The commenter stated an expectation that all GI endoscopy codes that currently contain distilled water should be revised to include sterile water instead.

Response: We have considered the comment; however, we re-examined the RUC-recommended direct PE inputs, and we did not identify the sterile water as part of that recommendation. Additionally, the commenter did not provide a detailed rationale for the use of sterile water over distilled water. Therefore, for CY 2016, we are finalizing the inputs for code 45330 as proposed. However, we are seeking additional information regarding these inputs (including rationale and explanation for the use of the commenter's recommended inputs) and we will consider this issue for future rulemaking.

Table 12—Application of the Incremental Difference Methodology

HCPCSDescriptorCurrent WRVURUC WRVUBase procedureBase RVUIncrementIncrement valueProposed WRVUFinalized WRVU (using 3.36 RVUs for the base)
44380Ileoscopy, through stoma; diagnostic, including collection of specimen(s) by brushing or washing, when performed1.050.97Colonoscopy3.29Colonoscopy to Ileoscopy−2.390.90.97
44382Ileoscopy, through stoma; with biopsy, single or multiple1.271.27Ileoscopy0.9Biopsy0.31.21.27
Start Printed Page 70945
44384Ileoscopy, through stoma; with placement of endoscopic stent (includes pre- and post-dilation and guide wire passage, when performed)NA3.11Ileoscopy0.9Stent1.982.882.95
44385Endoscopic evaluation of small intestinal pouch (e.g., Kock pouch, ileal reservoir [S or J]); diagnostic, including collection of specimen(s) by brushing or washing, when performed1.821.3Colonoscopy3.29Colonoscopy to endo. eval.−2.061.231.3
44386Endoscopic evaluation of small intestinal pouch (eg, Kock pouch, ileal reservoir [S or J]); with biopsy, single or multiple2.121.6Endo. Eval.1.23Biopsy0.31.531.6
44388Colonoscopy through stoma; diagnostic, including collection of specimen(s) by brushing or washing, when performed (separate procedure)2.822.82Colonoscopy3.29Colonoscopy to Colonoscopy through stoma−0.542.752.82
44389Colonoscopy through stoma; with biopsy, single or multiple3.133.12Colonoscopy through stoma2.75Biopsy0.33.053.12
44390Colonoscopy through stoma; with removal of foreign body3.823.82Colonoscopy through stoma2.75Foreign body1.023.773.84
44402Colonoscopy through stoma; with endoscopic stent placement (including pre- and post-dilation and guidewire passage, when performed)4.74.96Colonoscopy through stoma2.75Stent1.984.734.8
44403Colonoscopy through stoma; with endoscopic mucosal resectionNA5.81Colonoscopy through stoma2.75Endoscopic mucosal resection2.785.535.6
44404Colonoscopy through stoma; with directed submucosal injection(s), any substanceNA3.13Colonoscopy through stoma2.75Submucosal injection0.33.053.12
44406Colonoscopy through stoma; with endoscopic ultrasound examination, limited to the sigmoid, descending, transverse, or ascending colon and cecum and adjacent structuresNA4.41Colonoscopy through stoma2.75Endoscopic ultrasound1.384.134.2
45330Sigmoidoscopy, flexible; diagnostic, including collection of specimen(s) by brushing or washing when performed0.960.84Colonoscopy3.29Colonoscopy to Sigmoidoscopy−2.520.770.84
45331Sigmoidoscopy, flexible; with biopsy, single or multiple1.151.14Sigmoidoscopy0.77Biopsy0.31.071.14
45332Sigmoidoscopy, flexible; with removal of foreign body1.791.85Sigmoidoscopy0.77Foreign body1.021.791.86
Start Printed Page 70946
45335Sigmoidoscopy, flexible; with directed submucosal injection(s), any substance1.461.15Sigmoidoscopy0.77Submucosal injection0.31.071.14
45341Sigmoidoscopy, flexible; with endoscopic ultrasound examination2.62.43Sigmoidoscopy0.77Endoscopic ultrasound1.382.152.22
45346Sigmoidoscopy, flexible; with ablation of tumor(s), polyp(s), or other lesion(s) (includes pre- and post-dilation and guide wire passage, when performed)NA2.97Sigmoidoscopy0.77Ablation2.072.842.91
45347Sigmoidoscopy, flexible; with placement of endoscopic stent (includes pre- and post-dilation and guide wire passage, when performed)NA2.98Sigmoidoscopy0.77Stent1.982.752.82
45349Sigmoidoscopy, flexible; with endoscopic mucosal resectionNA3.83Sigmoidoscopy0.77Endoscopic mucosal resection2.783.553.62
45378Colonoscopy, flexible; diagnostic, including collection of specimen(s) by brushing or washing, when performed, (separate procedure)3.693.36Colonoscopy3.293.36
45379Colonoscopy, flexible; with removal of foreign body4.684.37Colonoscopy3.29Foreign body1.024.314.38
45380Colonoscopy, flexible, proximal to splenic flexure; with biopsy, single or multiple4.433.66Colonoscopy3.29Biopsy0.33.593.66
45381Colonoscopy, flexible; with directed submucosal injection(s), any substance4.193.67Colonoscopy3.29Submucosal injection0.33.593.66
45389Colonoscopy, flexible; with endoscopic stent placement (includes pre- and post-dilation and guide wire passage, when performed)NA5.5Colonoscopy3.29Stent1.985.275.34
45390Colonoscopy, flexible; with endoscopic mucosal resectionNA6.35Colonoscopy3.29Endoscopic mucosal resection2.786.076.14
45391Colonoscopy, flexible; with endoscopic ultrasound examination limited to the rectum, sigmoid, descending, transverse, or ascending colon and cecum, and adjacent structures5.094.95Colonoscopy3.29Endoscopic ultrasound1.384.674.74

(2) Laparoscopic Sleeve Gastrectomy (CPT Code 43775)

Prior to CY 2013, CPT code 43775 described a non-covered service. For CY 2013, this service was covered as part of the bariatric surgery National Coverage Determination (NCD) and has been contractor-priced since 2013. In the CY 2016 PFS proposed rule, we proposed to establish national pricing for CPT code 43775. To establish a work RVU, we crosswalked the work RVUs for this code from CPT code 37217 (Transcatheter placement of an intravascular stent(s), intrathoracic common carotid artery or innominate artery by retrograde treatment, via open ipsilateral cervical carotid artery Start Printed Page 70947exposure, including angioplasty, when performed, and radiological supervision and interpretation), due to their identical intraservice times, similar total times, and similar levels of intensity. Therefore, we proposed a work RVU of 20.38 for CPT code 43775.

Comment: Some commenters noted that CPT code 43775 was reviewed at the April 2009 RUC meeting and that the RUC submitted recommendations to CMS for CY 2010, including a recommendation of 21.40 work RVUs for CPT code 43775. The commenters stated that those recommendations are still valid and requested that CMS accept the RUC recommended work RVU of 21.40 for CPT code 43775.

Response: We thank the commenters for pointing out the previous RUC recommendations from April 2009. We continue to believe that the proposed work RVU is appropriate based on the reasons stated in the proposed rule, and therefore, for CY 2016, we are finalizing a work RVU of 20.38 for CPT code 43775.

Comment: A few commenters noted that they believe the crosswalk code used by CMS (CPT code 37217) does encourage relativity, but because it is an endovascular procedural code, does not accurately capture all aspects of a bariatric surgical patient in the pre-service, intra-service, or post-service periods. Commenters stated that they believed a comparison within the code family would provide an assessment that is more accurate. The commenters urged CMS to accept the previous valuation of 21.56.

Response: After consideration of the comments, we continue to believe that the proposed work RVU is appropriate based on the reasons stated in the proposed rule, and that it maintains relativity within its family of codes. Therefore, for CY 2016, we are finalizing a work RVU of 20.38 for CPT code 43775.

(3) Incomplete Colonoscopy (CPT codes 44388, 45378, G0105, and G0121)

Prior to CY 2015, according to CPT instruction, an incomplete colonoscopy was defined as a colonoscopy that did not evaluate the colon past the splenic flexure (the distal third of the colon). In accordance with that definition, the Medicare Claims Processing Manual (pub. 100-04, chapter 12, section 30.1.B., available at http://www.cms.gov/​Regulations-and-Guidance/​Guidance/​Manuals/​Internet-Only-Manuals-IOMs-Items) states that physicians should report an incomplete colonoscopy with 45378 and append modifier -53, which is paid at the same rate as a sigmoidoscopy.

In CY 2015, the CPT instruction changed the definition of an incomplete colonoscopy to a colonoscopy that does not evaluate the entire colon. The 2015 CPT Manual states when performing a diagnostic or screening endoscopic procedure on a patient who is scheduled and prepared for a total colonoscopy, if the physician is unable to advance the colonoscope to the cecum or colon-small intestine anastomosis due to unforeseen circumstances, report 45378 (colonoscopy) or 44388 (colonoscopy through stoma) with modifier -53 and provide appropriate documentation.

Given that the new definition of an incomplete colonoscopy also includes colonoscopies where the colonoscope is advanced past the splenic flexure but not to the cecum, we proposed to establish new values for the incomplete colonoscopies, reported with the -53 modifier. At present, we crosswalk the RVUs for the incomplete colonoscopies from the values of the corresponding sigmoidoscopy. Given that the new CPT instructions will reduce the number of reported complete colonoscopies and increase the number of colonoscopies that proceeded further toward completion reported with the -53 modifier, we believe CPT code 45378 reported with the -53 modifier will now describe a more resource-intensive group of services than were previously reported. Therefore, we proposed to develop RVUs for these codes reported with the -53 modifier by using one-half the value of the inputs for the corresponding codes reported without the -53 modifier.

In addition to this change in input values, we also solicited comments on how to address the disparity of resource costs among the broader range of services now described by the colonoscopy codes billed with the -53 modifier. We believe that it may be appropriate for practitioners to report the sigmoidoscopy CPT code 45330 under circumstances when a beneficiary is scheduled and prepared for a total colonoscopy (diagnostic colonoscopy, screening colonoscopy or colonoscopy through stoma), but the practitioner is unable to advance the colonoscope beyond the splenic flexure. We solicited comments and recommendations on that possibility, as well as more generally, the typical resource costs of these incomplete colonoscopy services under CPT's new definition. Finally, we solicited information regarding the number of colonoscopies that will be considered incomplete under CPT's new definition relative to the old definition, as well as the number of incomplete colonoscopies where the practitioner is unable to advance the colonoscope beyond the splenic flexure. This information will help us determine whether or not differential payment is required, and if it is, how to make the appropriate utilization assumptions within our ratesetting process.

Comment: Some commenters agreed with the proposed policy of using the-53 modifier to identify the reduced work involved with an incomplete colonoscopy and a reimbursement that is 50 percent of the full procedure. However, some noted that instances where the cecum is not reached immediately would be associated with greater PE than sigmoidoscopy, noting that the endoscopist will have utilized a colonoscope for the procedure requiring greater work for staff to clean and also noted that the endoscopist will commonly obtain a pediatric endoscope to navigate the narrowed sigmoid. Commenters also stated that sigmoidoscopy is a procedure commonly performed without moderate sedation. One commenter recommended that CMS establish a new modifier for instances in which the colonoscope has passed beyond the splenic flexure but has not reached the cecum or small bowel—large bowel anastomosis due to inadequate preparation precluding high-quality examination of the lumen of the bowel or technical limitations that preclude the ability of the physician to safely complete the examination of the colon. The commenter also recommended that payment for the professional services for colonoscopy in these circumstances be adjusted to 75 percent of the payment for the colonoscopy procedure, noting that appending this new modifier to the professional services for the procedure would allow the same or other physician to bring the patient back for another colonoscopy examination within 2 months without triggering the frequency limitation under the Act, and that facility payment for the procedure would not be adjusted when this modifier is reported with codes 45378, G0105 or G0121.

Response: We appreciate the commenters' support for the proposed policy of using the-53 modifier. We also appreciate the additional feedback regarding the resource costs of incomplete colonoscopies and will consider whether further changes to valuation or the coding structure are necessary in future rulemaking.

(4) Malpractice (MP) Crosswalk

We examined the RUC-recommended MP crosswalk for this family of codes. The MP crosswalks are used to identify the presumed mix of specialties that Start Printed Page 70948furnish particular services until there is Medicare claims data for the new codes. We direct the reader to section II.B.1. of this final rule with comment period for further explanation regarding these crosswalks. In reviewing the recommended MP crosswalks for CPT codes 43775, 44407, 44408, 46601, and 46607, we noted that the RUC-recommended MP crosswalk codes are inconsistent with our analysis of the specialties likely to furnish the service based on the description of the services and our review of the RUC-recommended utilization crosswalk. The inconsistency between the RUC-recommended MP and utilization crosswalks is not altogether unusual. However when there are discrepancies between the MP and utilization crosswalk recommendations, they generally reflect the RUC's expectation that due to changes in coding, there will be a different mix of specialties reporting a new code than might be reflected in the claims data for the code previously used to report that service. This often occurs when the new coding structure for a particular family of services is either more or less specific than the old set of codes. In most of these cases, we could identify a rationale for why the RUC-recommended MP crosswalks for these codes were likely to be more accurate than the RUC-recommended utilization crosswalk. But in the case of these codes, the reason for the discrepancies were neither apparent nor explained as part of the recommendation. Since the specialty mix in the claims data is used to determine the specialty mix for each HCPCS code for the purposes of calculating MP RVUs, and those data will be used to set the MP RVUs once it is available, we believe using a specialty mix derived from the claims data of the predecessor codes is more likely to be accurate than the RUC-recommended MP crosswalk as well as more likely to result in stable MP RVUs for these services over several years. Therefore, until claims data under the new set of codes are available, we proposed to use the specialty mix of the source code(s) in the RUC-recommended utilization crosswalk to calculate the malpractice risk factor for these services instead of the RUC-recommended MP crosswalk. Once claims data are available, those data will be incorporated into the calculation of MP RVUs for these services under the MP RVU methodology.

Comment: The RUC commented that they support CMS' decision to use the utilization crosswalk in determining the malpractice crosswalk for CPT code 43775 given that there are newer data since the RUC last reviewed this code in 2009. However, the RUC commented that it did not agree with this proposed decision for the other four services, CPT codes 44407, 44408, 46601, and 46607, stating that its MP crosswalks for these codes were based on the intended specialty mix.

Response: We continue to believe that the RUC-recommended MP crosswalk codes are inconsistent with our analysis of the specialties likely to furnish the service based on the description of the services and our review of the RUC recommended utilization crosswalk. Therefore, for CY 2016, we are finalizing these malpractice crosswalk codes as proposed.

b. Radiation Treatment and Related Image Guidance Services

For CY 2015, the CPT Editorial Panel revised the set of codes that describe radiation treatment delivery services based in part on the CMS identification of these services as potentially misvalued in CY 2012. We identified these codes as potentially misvalued under a screen called “Services with Stand-Alone PE Procedure Time.” We proposed this screen following our discovery of significant discrepancies between the RUC-recommended 60 minute procedure time assumptions for intensity modulated radiation therapy (IMRT) and information available to the public suggesting that the procedure typically took between 5 and 30 minutes per treatment.

The CPT Editorial Panel's revisions included the addition and deletion of several codes and the development of new guidelines and coding instructions. Four treatment delivery codes (77402, 77403, 77404, and 77406) were condensed into 77402 (Radiation Treatment Delivery, Simple), three treatment delivery codes (77407, 77408, 77409) were condensed into 77407 (Radiation treatment delivery, intermediate), and four treatment codes (77412, 77413, 77414, 77416) were condensed into 77412 (Radiation treatment delivery, complex). Intensity Modulated Radiation Therapy (IMRT) treatment delivery, previously reported under a single code, was split into two codes, 77385 (IMRT treatment delivery, simple) and 77386 (IMRT treatment delivery, complex). The CPT Editorial Panel also created a new image guidance code, 77387 (Guidance for localization of target volume for delivery of treatment, includes intrafraction tracking when performed) to replace 77014 (computed tomography guidance for placement of radiation therapy fields), 77421 (stereoscopic X-ray guidance for localization of target volume for the delivery of radiation therapy,) and 76950 (ultrasonic guidance for placement of radiation therapy fields) when any of these services were furnished in conjunction with radiation treatment delivery.

In response to stakeholder concerns regarding the magnitude of the coding changes and in light of the process changes we adopted for valuing new and revised codes, we did not implement interim final values for the new codes and delayed implementing the new code set until 2016. To address the valuation of the new code set through proposed rulemaking, and continue making payment based on the previous valuations even though CPT deleted the prior radiation treatment delivery codes for CY 2015, we created G-codes that mimic the predecessor CPT codes (79 FR 67667).

We proposed to establish values for the new codes based on RUC recommendations, subject to standard CMS refinements. We also note that because the invoices used to price the capital equipment included “on-board imaging,” and based on our review of the information used to price the equipment, we considered the costs of that equipment already to be reflected in the price per minute associated with the capital equipment. Therefore, we did not propose to include it as a separate item in the direct PE inputs for these codes, even though it appeared as a separate item on the PE worksheet included with the RUC recommendations for these codes. The proposed direct PE inputs for those codes were displayed the proposed direct PE input database available on the CMS Web site under the supporting data files for the CY 2016 PFS proposed rule with comment period at http://www.cms.gov/​PhysicianFeeSched/​. The RVUs that result from the use of these direct PE inputs (and work RVUs and work time, as applicable) were displayed in proposed rule Addendum B on the CMS Web site.

We received many comments regarding various aspects of our proposal to implement the new CPT codes for radiation treatment services based on our refinement of RUC-recommended input values. Some commenters addressed issues for which we explicitly sought comment, while several commenters brought other issues to our attention. We address these comments in the following paragraphs.

(1) Image Guidance Services

Under the previous CPT coding structure, image guidance was separately billable when furnished in Start Printed Page 70949conjunction with the radiation treatment delivery services. The image guidance was reported using different CPT codes, depending on which image guidance modality was used. These codes were split into professional and/or technical components that allowed practitioners to report a single component or the global service. The professional component of each of these codes included the work of the physician furnishing the image guidance. CPT code 77014, used to report CT guidance, had a work RVU of 0.85; CPT code 77421, used to report stereotactic guidance, had a work RVU of 0.39, and CPT code 76950, used to report ultrasonic guidance, had a work RVU of 0.58. The technical component of these codes incorporated the resource costs of the image guidance capital equipment (such as CT, ultrasound, or stereotactic) and the clinical staff involved in furnishing the image guidance associated with the radiation treatment. When billed globally, the RVUs reflected the sum of the professional and technical components. In the revised coding structure, one new image guidance code is to be reported regardless of the modality used, and in developing its recommended values, the RUC assumed that CT guidance would be typical.

However, the 2013 Medicare claims data for separately reported image guidance indicated that stereotactic guidance for radiation treatment services was furnished more frequently than CT guidance. The RUC recommended a work RVU of 0.58 and associated work times of three pre-service minutes, 10 intraservice minutes, and three post-service minutes for image guidance CPT code 77387. We reviewed this recommendation considering the discrepancy between the modality the RUC assumed to be typical in the vignette and the modality typically reported in the Medicare claims data. Given that the recommended work RVU for the new single code is similar to the work RVUs of the predecessor codes, roughly prorated based on their distribution in Medicare claims data, we agree with the RUC-recommended work RVU for the service. However, the RUC also recommended an increase in overall work time associated with image guidance consistent with the survey data used to value the new services. If accurate, this increase in time and maintenance of total work would suggest a decrease in the overall intensity for image guidance relative to the current codes. We solicited comments as to the appropriate work time associated with CPT code 77387.

Comment: Commenters provided feedback that work time of 16 minutes is accurate for 77387, consistent with the RUC recommendation without explaining why the work time associated with image guidance has changed significantly.

Response: We appreciate that commenters responded to our solicitation but the commenters did not provide a rationale for why the recommended work time for the new code would be significantly different than the current work time for the most frequently reported predecessor code. Absent an explanation, we remain concerned that the aspects of the recommended values for the new single modality code were developed based on erroneous assumptions regarding what imaging modality is most frequently used to provide guidance for radiation treatment services.

Although CPT codes 77421 (stereotactic guidance) and 76950 (ultrasonic guidance) have been deleted, we note that CPT maintained CPT code 77014 (Computed tomography guidance for placement of radiation therapy fields). The RUC recommendation stated that the CPT editorial panel maintained CPT code 77014 based on concerns that without this option, some practitioners might have no valid CPT alternative than to use higher valued diagnostic CT codes when they used this CT guidance. The RUC recommendation also included a statement that utilization of this code was expected to drop to negligible levels in 2015, assuming that practitioners would use the new codes that are not differentiated based on imaging modality. Once all the new codes are implemented for Medicare, we anticipate that CPT and/or the RUC will address the continued use of 77014 and, if it continues to be part of the code set, provide recommendations as to the appropriate values given changes in utilization.

Comment: Several commenters stated that, while they believe that the volume for 77014 will fall to negligible levels, they support CMS' adoption of the decision to continue to monitor and review this code.

Response: We appreciate commenters support and the stakeholder interest in making certain that the codes accurately describe the services furnished to Medicare beneficiaries.

Regarding the reporting of the new image guidance codes, CPT guidance instructs that the technical portion of image guidance is now bundled into the IMRT and stereotactic radiation treatment delivery codes, but it is not bundled into the simple, intermediate, and complex radiation treatment delivery codes. CPT guidance states that the technical component of the image guidance code can be reported with CPT codes 77402, 77407, and 77412 (simple, intermediate, and complex radiation treatment) when furnished, which means that the technical component of the image guidance code should not be reported with the IMRT, stereotactic radiosurgery (SRS) or stereotactic body radiation therapy (SBRT) treatment delivery codes. The RUC recommendation, however, incorporated the same capital cost of image guidance equipment (a linear accelerator, or linac), for the conventional radiation treatment delivery codes and the the codes that describe IMRT treatment delivery services. The RUC explained that the older lower-dose external beam radiation machines are no longer manufactured and the image guidance technology is integrated into the single kind of linear accelerator used for all the radiation treatment services.

In reviewing the new code structure and the RUC recommendations for the proposed rule, we assumed that the CPT editorial panel did not foresee that the RUC would recommend that we develop PE RVUs for all the radiation treatment delivery codes based on the assumption that the same capital equipment is typically used in furnishing this range of external beam radiation treatments. Because the RUC recommendations incorporate the more extensive capital equipment in the lower dose treatment codes as well, a portion of the resource costs of the technical portion of imaging guidance are already allocated into the PE RVUs for all of the treatment delivery codes, not just the IMRT, SRS, and SBRT treatment delivery codes as CPT guidance would suggest.

In order to avoid incorporating the cost of this equipment into both the treatment delivery codes (CPT codes 77402, 77407, and 77412) and the technical component of the new imaging guidance code (CPT code 77387-TC), we considered valuing CPT code 77387 as a professional service only and not creating the professional/technical component splits envisioned by CPT. In the proposed rule we stated that in the context of the budget neutral PFS, incorporating a duplicative direct input with a cost of more than six dollars per minute would have significant impacts on the PE RVUs for all other services. However, we also noted that the RUC did not address this issue in its recommendation and proposed that not all of the recommended direct PE inputs for the Start Printed Page 70950technical component of CPT code 77387 are capital equipment costs. Therefore, we proposed to allow for professional and technical component billing for these services, as reflected in CPT guidance, and to use the RUC-recommended direct PE inputs for these services (refined as described in Table 13 of the proposed rule (80 FR 41725-41764). We solicited comments on the technical component billing for image guidance in the context of the inclusion of a single linac and the RUC-recommended integration of imaging guidance technology for all external beam treatment codes.

Comment: Many commenters stated that it was necessary for CPT code 77387 to include both a technical and professional component because the current price of the linear accelerator used in radiation treatment delivery services does not include the additional costs of an integrated image guidance system. These commenters urged CMS to retain the technical and professional components for CPT code 77387 on the basis that there are equipment and labor costs associated with image guidance that are not reflected in a professional-only code.

Some other commenters were concerned that the new coding structure for image guidance did not accurately reflect the way that image guidance is typically furnished. These commenters stated that multiple modalities of image guidance can be used in a single procedure, and that this heterogeneity is not reflected through a single image guidance code.

Response: We appreciate that many commenters addressed the bundling in the new CPT codes of the technical component of image guidance for IMRT, SRS, and SBRT, but not for conventional radiation treatment delivery codes. However, in reviewing the comments, we did not identify any that address the fundamental issues we identified in the proposed rule. We understand that commenters generally agreed that image guidance was not necessarily typically used for conventional radiation treatment delivery services, so the related costs should not be embedded in the RVUs for the treatment delivery codes. We also understand that commenters recommended that we assume that image guidance costs, while integrated into the functionality of the linear accelerator, represent additional capital costs and should be used in the development of PE RVUs for these services. Despite these comments, we were unable to reconcile the inconsistencies and potential rank order anomalies associated with including the image guidance costs in the IMRT treatment delivery codes but not including the image guidance costs in the conventional radiation treatment delivery codes even though both use the same capital equipment. Based on the RUC recommendations and the information from the commenters, we understand that the same linear accelerator is typically used for all of these services, and that the image guidance is integrated into the only linear accelerator that is currently being manufactured and that, therefore, the image guidance costs should always be included in the RVUs for the IMRT treatment delivery codes. Based on these comments and the RUC-recommended values, it appears that when the same machine (with integrated image guidance) is used for intermediate and complex conventional treatment, the combination of the treatment costs and image guidance costs is significantly higher than the technical costs associated with IMRT treatment delivery furnished with image guidance. As a result, the PE RVUs for these services include higher overall payment for intermediate and complex conventional radiation treatment with imaging guidance than for simple IMRT treatment delivery with imaging guidance. After review of the comments, we continue to believe that this creates problematic rank order anomalies, both relative to the accuracy of the assumed costs and the financial incentives associated with Medicare paying more overall for conventional radiation treatment than for IMRT services.

Comment: Many commenters, including equipment manufacturers, suggested that linacs that include integrated image guidance are significantly more expensive than the $2.6 million CMS proposed in the direct practice expense input database. One commenter, a manufacturer of linear accelerators, submitted several invoices intended to indicate that the price of a new linear accelerator is significantly higher than the current price in the direct PE input database. This commenter suggested that this higher price was due in part to the integrated image guidance, inherent in all new linear accelerators. The commenter also submitted invoices intended to illustrate the price of upgrading an older linear accelerator with image guidance capability.

Response: We appreciate the submission of invoices that indicate prices for linear accelerators with image guidance and the price associated with updating existing linacs with image guidance. In our analysis of these documents, however, we identified several aspects that make us hesitant to use the documents to change the price of the equipment in the direct PE input database. First, many of the invoices listed a total contract value that was distinct from the sum of total prices listed on the invoice. The documents themselves did not include any explanation regarding the significant differences in value between these two prices and whether or not the differences in value represent costs related to other direct PE input equipment items, factors already incorporated into the equipment cost per minute calculation, or items included in the allocation of indirect PE. For example, some line items included the description of items such as “travel and lodging,” “education,” and treatment planning software or software upgrades that are already accounted for in the allocation of indirect PE. In many cases line-item prices were not included, making it difficult to identify the portion of the total invoice price attributable to direct equipment costs, which is necessary under the established PE methodology. Therefore, we will maintain the current equipment price for CY 2016 while we seek accurate information regarding the price of this capital equipment.

(2) Equipment Utilization Rate for Linear Accelerators

The cost of the capital equipment is the primary determining factor in the payment rates for these services. For each CPT code, the equipment costs are estimated based on multiplying the assumed number of minutes the equipment is used for that procedure by the per minute cost of the particular equipment item. Under our PE methodology, we currently use two default equipment usage assumptions in allocating capital equipment costs to calculate PE RVUs. The first is that each equipment item is only available to be used during what are assumed to be regular business hours for a physician's office: 10 hours per day, 5 days per week (50 hours per week) and 50 weeks per year. The second assumption is that the equipment is in use only 50 percent of the time that it is available for use. The current default 50 percent utilization rate assumption translates into 25 hours per week out of a 50-hour work week.

We have previously addressed the accuracy of these default assumptions as they apply to particular equipment resources and particular services. In the CY 2008 PFS proposed rule (72 FR 38132), we discussed the 50 percent utilization assumption and acknowledged that the default 50 Start Printed Page 70951percent usage assumption is unlikely to capture the actual usage rates for all equipment. However, we stated that we did not believe that we had strong empirical evidence to justify any alternative approaches. We indicated that we would continue to monitor the appropriateness of the equipment utilization assumption, and evaluate whether changes should be proposed in light of the data available.

Subsequently, a 2009 report on equipment utilization by MedPAC included studies that suggested a higher utilization rate for diagnostic imaging equipment costing more than $1 million. These studies cited by MedPAC suggested that for Magnetic Resonance Imaging equipment, a utilization rate of 92 percent on a 50-hour week would be most accurate. Similarly, another MedPAC-cited study suggested that for computed tomography scanners, 45 hours was more accurate, and would be equivalent to a 90 percent utilization rate on a 50-hour work week. For the CY 2010 PFS proposed rule, we proposed to increase the equipment usage rate to 90 percent for all services containing equipment that cost in excess of $1 million dollars. We stated that the studies cited by MedPAC suggested that physicians and suppliers would not typically make huge capital investments in equipment that would only be utilized 50 percent of the time (74 FR 33532).

In response to comments to that proposal, we finalized a 90 percent utilization rate assumption for MRI and CT to be transitioned over a 4-year period. Regarding the utilization assumptions for other equipment priced over $1 million, we stated that we would continue to explore data sources regarding use of the most accurate utilization rates possible (74 FR 61755). Congress subsequently specified the utilization rate to be assumed for MRI and CT by successive amendments to section 1848(b)(4)(C) of the Act. Section 3135(a) of the Affordable Care Act (Pub. L. 111-148) set the assumed utilization rate for expensive diagnostic imaging equipment to 75 percent, effective for 2011 and subsequent years. Section 635 of the American Taxpayer Relief Act (ATRA) (Pub. L. 112-240) set the assumed equipment utilization rate to 90 percent, effective for 2014 and subsequent years. Both of these changes were exempted from the budget neutrality requirements described in section 1848(c)(2)(B)(ii)(II) of the Act.

We have also made other adjustments to the default assumptions regarding the number of hours for which the equipment is available to be used. For example, some equipment used in furnishing services to Medicare beneficiaries is available to be used on a 24-hour/day, 7 days/per week basis. For these items, we develop the rate per minute by amortizing the cost over the extended period of time the equipment is in use.

Based on the RUC recommendations for the new codes that describe radiation treatment services, we do not believe our default assumptions regarding equipment usage are accurate for the capital equipment used in radiation treatment services. As we noted above, the RUC recommendations assume that the same type of linear accelerator is now typically used to furnish all levels and types of external beam radiation treatment services because the machines previously used to furnish these services are no longer manufactured. In valuing the previous code set and making procedure time assumptions, different equipment items were assumed to be used to furnish the different levels and types of radiation treatment. With the current RUC-recommended inputs, we can then assume that the same equipment item is used to furnish more services. If we assume the RUC recommendation to include the same kind of capital equipment for all of these codes is accurate, we believe that it is illogical to continue to assume that the equipment is only used for 25 out of a possible 50 hours per week. In order to estimate the difference between the previous number of minutes the linear accelerator was assumed to be in use under the previous valuation and the number of minutes now being recommended by the RUC, we applied the change in assumptions to the services reported in the most recent year of Medicare claims data. Under the assumptions reflected in the previous direct PE inputs, the kind of linear accelerator used for IMRT made up a total of 44.8 million out of 65 million minutes of external beam treatments furnished to Medicare beneficiaries. Under the new code set, however, we suggested in the proposed rule that a single kind of linear accelerator would be used for all of the 65 million minutes furnished to Medicare beneficiaries. This represents a 45 percent increase in the aggregate amount of time that this kind of linac is in use. As we noted in the proposed rule, the utilization rate that corresponds with that increase in minutes is not necessarily precise since the current utilization rate only reflects the default assumption and is not itself rooted in empirical data. Additionally, in some cases, individual practices that already use linear accelerators for IMRT may have replaced the now-obsolete capital equipment with new, additional linear accelerators instead of increasing the use of capital equipment already owned. However, we do not believe that the latter scenario is likely to be common in cases where the linear accelerators had previously been used only 25 hours per week.

Therefore, we proposed to adjust the equipment utilization rate assumption for the linear accelerator to account for the significant increase in usage. Instead of applying our default 50 percent assumption, we proposed to use a 70 percent assumption based on the recognition that the item is now being typically used in a significantly broader range of services, and that would increase how often the equipment is used in comparison to the previous assumption. In the proposed rule, we noted that we developed the 70 percent rate based on a rough reconciliation between the number of minutes the equipment is being used according to the new recommendations versus the current number of minutes based on an analysis of claims data.

Comment: Several commenters objected to our analysis specifically because we described it as a “rough reconciliation.”

Response: We appreciate commenters' interest in our use of the best data available in determining what values to assign to necessary assumptions. We regret the use of the term “rough reconciliation” and clarify that our analysis relied on two somewhat imprecise data points: The RUC procedure time assumptions for individual services and the current 50 percent utilization assumption. Because both of these assumptions directly determine how capital equipment costs are translated into PE RVUs, they were essential to our analysis. However, we recognize that these assumptions are round figures, reflecting assumptions about what is typical. Therefore, when we combined these numbers with precise Medicare claims data in order to develop a more accurate assumption, we arrived at a very specific number that might have appeared to be very precise. Recognizing that the calculation was based on assumptions as noted above, we subsequently proposed to round the number to 70 percent instead of using the fractional result of the calculation. We continue to believe rounding to 70 percent is appropriate for the reasons stated above.

Given the best available information, we believe that the 70 percent utilization assumption based on the changes in direct PE input recommendations and Medicare claims Start Printed Page 70952data is more accurate than the default utilization assumption of 50 percent. However, we have reviewed other information that suggests this utilization rate may be higher than 70 percent and that the number of available hours per week is greater than 50.

For example, as part of the 2014 RUC recommendations for the Radiation Treatment Delivery codes, the RUC submitted a 2011 staffing survey conducted by the American Society for Radiology Technicians (ASRT). Using the 2014 version of the same study, we noted that there are an average of 2.3 linacs per radiation treatment facility and 52.7 patients per day treated per radiation treatment facility. These data suggest that an average of 22.9 patients are treated on each linac per day. Using an average of the RUC-recommended procedure times for CPT codes 77385, 77386, 77402, 77407, and 77412 weighted by the annual volume of procedures derived from Medicare claims data yielded a total of 670.39 minutes or 11.2 hours that a single linac is in use per day. This is in contrast to both the number of hours of use reflected in our default assumptions (5 of the 10 available business hours per day) and in our proposed revision to the equipment utilization rate assumptions (7 hours out of 10 available business hours per day).

For advanced diagnostic imaging services, we finalized a policy for CY 2010 to change the equipment utilization assumption only by 10 percent per year, in response to suggestions from commenters. Because capital equipment costs are amortized over several years, we believe it is reasonable to transition changes to the default assumptions for particular items over several years. We noted in the proposed rule that the change from one kind of capital equipment to another is likely to occur over a number of years, roughly equivalent to the useful life of particular items as they become obsolete. In the case of most of these items, we have assumed a 7-year useful life, and therefore, we assumed that the transition to use of a single kind of capital equipment would likely take place over seven years as individual pieces of equipment age into obsolescence. However, in the case of this transition in capital equipment, we have reason to believe that the transition to the new capital equipment has already occurred. First, we note that the specialty societies concluded that the single linear accelerator was typical for these services at the time that the current recommendations were developed in 2013. Therefore, we believe it is logical to assume that, at a minimum, the first several years of the transition to new capital equipment had already taken place by 2013. This would not be surprising, given that prior to the 2013 review by the RUC, the codes describing the non-IMRT external beam radiation treatments had last been reviewed in 2002. Second, because we proposed to use the 2013 recommendations for the CY 2016 PFS payment rates, we believed it would be reasonable to assume that in the years between 2013 and 2016, the majority of the rest of the obsolete machines would have been replaced with the single linear accelerator.

Nonetheless, we recognized that there would be value in following precedent to transition changes in utilization assumptions over several years.

Given the fact that it is likely that the transition to the linear accelerator began prior to the 2013 revaluation of the radiation treatment delivery codes by the RUC and that the useful life of the newest generation of linear accelerator is seven years, we believe a 2-year transition to the 70 percent utilization rate assumption would account for any remaining time to transition to the new equipment. Therefore, in developing PE RVUs for these services, we proposed to use a 60 percent utilization rate assumption for CY 2016 and a 70 percent utilization rate assumption for CY 2017. The proposed PE RVUs displayed in Addendum B on the CMS Web site were calculated using the proposed 60 percent equipment utilization rate for the linac as displayed in the proposed direct PE input database.

Additionally, we continue to seek empirical data on the capital equipment costs, including equipment utilization rates, for the linac and other capital-intensive machines, and seek comment on how to most accurately address issues surrounding those costs within the PE methodology.

Comment: Most commenters were opposed to changing the default utilization assumption for linear accelerators. Many of these commenters stated that the rationale CMS used to support the change in default utilization assumption was inadequate and anecdotal. Several commenters performed and submitted their own data analyses.

Response: We continue to believe a reconciliation of Medicare claims data with the RUC-recommended procedure times results in the most accurate equipment utilization rate assumption. We also believe that whenever possible we should use the Medicare claims data to test the validity and internal consistency of our ratesetting assumptions. We do not agree with the commenters that such an approach is anecdotal. While CMS appreciates the analyses performed by some commenters, no additional data were submitted to substantiate these analyses.

Comment: One commenter conducted an analysis somewhat similar to ours, but used three data sets: Medicare claims data, the ASRT staffing survey CMS referenced in the proposed rule, and data from the CMS physician billing public use database. Based on this analysis, the commenter suggested that 50 percent is a more accurate utilization assumption.

Response: We appreciate the commenter's analysis, and found it to be very useful in considering whether or not to finalize our proposal. However, the commenter's conclusion of a 50 percent utilization rate is entirely dependent on what we believe is an overestimate of the number of linacs used to deliver radiation treatment. In order to determine the number of linacs overall, the commenter multiplied the 2.3 linacs per center statistic cited in the ASRT staffing survey by the number of individual billing entities reporting treatment services in the Medicare claims data as a proxy for the number of freestanding centers. That approach would count two radiation oncologists reporting services in the same center as if they were practicing in two centers, not one, and therefore overestimate the number of machines. Were the same analysis conducted using the number of centers included in the same ASRT staffing survey, the result of the analysis would be an approximately 70 percent equipment utilization rate. Therefore, we did not find the commenter's analysis persuasive.

Comment: Many commenters stated that a 70 percent utilization rate assumption did not take into account events beyond the control of the facility that could impact how long any given linear accelerator might be used over the course of time. These commenters suggested that issues such as time necessary to warm up the treatment machine, maintenance, patient preferences, missed appointments, and multiple treatment devices contributed to a lower utilization rate that CMS proposed to assume.

Response: We understand that the day-to-day operation and utilization of capital equipment will vary, and that is precisely why the equipment cost per minute calculation does not assume that the equipment is used for the full amount of time possible (100 percent rate). Instead, the utilization rate assumption is used to allocate the total cost of the equipment relative to other Start Printed Page 70953direct PE costs on a per-minute basis. Therefore, the assumptions are intended to reflect the percentage of total time (assuming a 50-hour work week) payment is made for services on the machine. In assigning minutes to individual codes, we generally assign minutes for preparing and cleaning the equipment; therefore, these minutes would contribute to the 70 percent portion, or 35 hours per week. In contrast, minutes for a missed appointment would count toward the 30 percent of the 50 hours, or 15 hours per week, that the equipment is not being used.

Comment: Many commenters were concerned that a higher utilization rate assumption would have a negative effect on rural treatment centers and treatment centers in medically disadvantaged areas.

Response: We believe it is important to preserve access to care for all Medicare beneficiaries. However, we believe we are obligated under the statute to use accurate assumptions in developing RVUs for individual services under the PFS. Under the statutory construct of the PFS, we believe that accurate valuation for all PFS services is important in maintaining access to care for all Medicare beneficiaries.

Comment: A few commenters suggested that CMS should phase in the utilization rate change over four years or delay implementing the change until 2017.

Response: We appreciate the commenters' suggestions. We did consider these suggested alternatives as part of our rulemaking process. Although both a longer phase-in and a delay would temporarily mitigate the payment reductions for these services, especially in the context of other proposed payment reductions, we did not identify any persuasive rationale for delaying implementation or phasing in implementation over more than 2 years.

Comment: Many commenters were concerned that the change in utilization rate assumption was affecting all equipment items in the radiation treatment delivery codes, and argued that it should only apply to the linac. Commenters urged CMS to use a 50 percent utilization rate assumption for the other equipment items. Some commenters argued that this was contradictory to the utilization assumption for advanced diagnostic imaging.

Response: We applied the increased utilization rate assumption across all equipment items under the assumption that items generally located in the same room as the linear accelerator could not be used to furnish other services while the linear accelerator was in use, and therefore, would be subject to the same utilization assumptions. This approach is consistent with the application of the equipment utilization assumption for advanced diagnostic imaging.

Comment: MedPAC expressed support for CMS' proposal to change the equipment utilization rate assumption for linear accelerators. MedPAC agreed that CMS should develop a normative standard based on the assumption that those who purchase an expensive piece of capital equipment would use it at a higher utilization rate.

Response: We appreciate MedPAC's support for the proposal.

(3) Other Equipment Cost Variables

Comment: A few commenters suggested that CMS update the price for the radiation treatment vault to approximately $800,000 and reduce the useful life assumption from 15 to 7 years. Several other commenters suggested that CMS update the variable maintenance rate from the default five percent assumption to between 10 and 15 percent.

Response: We appreciate the commenter's feedback, and acknowledge our longstanding concerns regarding obtaining accurate, objective information regarding the pricing of direct PE inputs, particularly the prices for expensive equipment. In the case of the radiation treatment vault, we believe that at least some portions of the costs associated with the vault construction are indirect PE under the established methodology. We will continue to consider this issue, including these commenters' suggestion to use increased pricing for the item.

Comment: Many commenters disagreed with the classification of “intercom” as an indirect PE. These commenters stated that the intercom is specifically for the practitioner to communicate directly with the patient and, as such, it constitutes a direct PE.

Response: We remind the commenter that under the established methodology, direct PE inputs are defined as clinical labor, disposable supplies, and medical equipment. Other items are incorporated as indirect costs, regardless of how the items are used.

Comment: Several commenters, including the AMA RUC, stated that CMS should include 2 minutes for the clinical labor task “dose output and verification” as it is performed on the equipment items associated with these codes.

Response: “Dose output and verification” occurs during the “pre-service” period and pre-service minutes are generally not allocated to the equipment items, under our established methodology.

(4) Specialty Impacts

Comment: One commenter stated that CMS should no longer display specialty level impacts for “radiation therapy centers” in the proposed and final rule. The commenter argued that since the PFS allowed charges associated with “Radiation Therapy Centers” represent only a small portion of radiation oncology services overall, displaying the impacts separately is misleading to the interested public.

Response: We appreciate the commenter's concerns and agree with commenters that the PFS allowed charges associated with “radiation therapy centers” is only a small portion of overall payments for radiation oncology services, including the total amount of those furnished outside of the hospital setting. Because we think it is important to maintain a consistent display of specialty-level impacts between a proposed and final rule, we are not making a change for this year's final rule. However, we are seeking additional comment regarding how the impacts for these services should be displayed in future rulemaking.

(5) Implementation of New Coding

Comment: Several commenters expressed concerns about the two new treatment delivery codes describing simple and complex IMRT treatment delivery in contrast to the current single code. Specifically, these commenters were concerned that that the CPT instruction that requires treatment for prostate and breast cancer to be reported using the simple IMRT treatment delivery code would have a negative impact on overall treatment for patients with prostate and breast cancer. These commenters suggested that that the new coding structure did not allow radiation therapy providers to accurately report prostate and breast cancer treatment services that are more resource intensive than those described in the simple IMRT code. These commenters also stated that the coding change including CMS' proposed valuations would have a widespread negative impact on access to care, including reduction in the number of freestanding centers offering radiation treatment for breast and prostate cancer, and therefore limit patients' access to care outside of the higher cost hospital setting.

Response: We believe that increased specificity in coding for such a resource-intensive, high-volume group of services is a significant improvement compared to the use of a single code to describe all IMRT treatment services, regardless Start Printed Page 70954of their relative resource costs. However, we understand the commenters' concerns about the potential negative impact of implementing the new code set for payment of treatment for breast and prostate cancers. The primary resource cost for these services is represented by the capital equipment, so we believe that for purposes of most accurate payment, the optimal coding for these services would group them based on how long the capital equipment is being used per service, so that payment is linked to the resource costs of furnishing particular services. Under the current set of codes, payment would be made based on the assumptions regarding the typical resource costs for the treatment of particular diseases, instead of the resource costs based on the length of treatment time.

Comment: Several commenters pointed out a rank order anomaly in the PE RVUs among codes CPT codes 77402, 77407, and 77412 that describe simple, intermediate, and complex radiation treatment codes, respectively. The commenters stated that it was illogical for the intermediate radiation treatment delivery code to have higher PE RVUs and overall payment compared to the complex radiation treatment delivery. Commenters suggested that this anomaly may be the result of the allocation of indirect PE because the specialty reporting the utilization for the intermediate code is more frequently dermatology than radiation oncology and dermatology is allocated more indirect PE within the PE methodology.

Response: We agree with commenters that this rank order anomaly is due to the difference in the mix of specialties in the utilization for these services. We also agree with the commenters that such rank order anomalies within families should be avoided when possible. We believe these kinds of rank order anomalies generally suggest inaccurate valuations and present risks to accurate billing and overall ratesetting. The risks are associated with incentives toward inaccurate downward coding. For example, in this case, individual practitioners would have the financial incentive to report radiation treatment delivery services using the intermediate code, even when the complex code would be more accurate. If practitioners acted on such an incentive, there would be serious consequences within our ratesetting methodologies for both purposes of budget neutrality and for allocation of PE RVUs. The increased utilization of the higher paying intermediate code would result in inappropriately low budge neutrality adjustment across the PFS. The rank order anomaly might also result in cyclical fluctuations in the year-to-year allocation of PE. This would happen if the inappropriate reporting of the intermediate code itself resulted in a concentration of most of the overall volume (including radiation oncology at a greater volume than dermatology) in the intermediate code. Then, once the claims data reflecting this concentration were incorporated into PFS ratesetting, the rank order anomaly would recur and the cycle would begin again. In considering these comments in the context of our proposal to implement these codes, we considered how we might eliminate this anomaly. We concluded that the best approach would be to maintain the total number of PE RVUs for these services overall, but to redistribute them among the three codes in order to eliminate the rank order anomaly. In order to do this, we would calculate the PE RVUs for these services under the established methodology and multiply these RVUs by the volume associated with each code. We would then reallocate the total number of PE RVUs among the three codes based on the weights of their direct costs included in the direct PE input database, since the total direct costs for these codes reflect appropriate valuation. We are seeking comment on this approach or other possible ways to mitigate the impact of the rank order anomaly among these codes.

Comment: One commenter stated that, in light of the significant negative impact of the coding changes and the proposed change in the default utilization rate assumption, CMS should delay implementation of the new codes for another year and work with stakeholders to gather information on the appropriate pricing of equipment items, utilization of equipment, and coding structure. A few commenters also stated that CMS should consider pricing radiation treatment delivery through the OPPS. And finally, several commenters noted that the proliferation of TC-only codes had a negative impact on the overall allocation of PE RVUs for radiation oncology services.

Response: We agree with commenters regarding the magnitude of changes that would result from the new code set. In general, we believe that significant changes in coding can improve the valuation and payment for PFS services. In the case of this set of new codes, we believe increased granularity in IMRT treatment delivery codes would benefit payment accuracy. We also believe that it is generally preferable for CMS to use CPT codes to describe physicians' services paid under the PFS and that, when possible, we should use consistent coding between the PFS and OPPS.

In consideration of comments from stakeholders and our concerns as described above, however, we do not believe that, on balance, we should finalize the new code set for CY 2016. Therefore, for CY 2016, we are not finalizing our proposal to implement the new set of codes. We will continue the use of the current G-codes and values for CY 2016 while we seek more information, including public comments and recommendations regarding new codes to be developed either through the CPT process or through future PFS rulemaking. We believe that significant changes to the codes need to be made before we can develop accurate payment rates under the PFS for these services. These changes would include: developing a code set that recognizes the difference in costs between kinds of imaging guidance modalities; making sure that this code set facilitates valuation that incorporates the cost of imaging based on how frequently it is actually provided; and developing treatment delivery codes that are structured to differentiate payment based on the equipment resources used.

While we are not finalizing the new code set for these services, we are finalizing our proposals to include the single linear accelerator for radiation treatment delivery services as recommended by the RUC, and to update the default utilization rate assumption for linear accelerators used in radiation treatment services from 50 to 70 percent, phased in over 2 years. Under either set of codes, it is clear that the 50 percent utilization assumption is incompatible with the times used to develop payment rates for individual procedures, given that the same linear accelerator is used for the services.

Finally, because the costs of capital equipment are the primary drivers of RVUs and payment amounts for these services, and we acknowledge significant difficult in obtaining quality information regarding the actual costs of such equipment across the wide range of practitioners and suppliers that furnish these services, we will be engaging in market research to develop independent estimates of utilization and pricing for linear accelerators and image guidance used in furnishing radiation treatment services. We will also consider ways in which data collected from hospitals under the OPPS may be helpful in establishing rates for these and other technical component services. We will consider this information, including public comment, as we develop proposals for inclusion in future notice and comment rulemaking.Start Printed Page 70955

(6) Superficial Radiation Treatment Delivery

In the CY 2015 PFS final rule with comment period, we noted that changes to the CPT prefatory language modified the services that are appropriately billed using CPT code 77401 (radiation treatment delivery, superficial and/or ortho voltage, per day). The changes effectively meant that many other procedures supporting superficial radiation therapy were bundled with CPT code 77401. The RUC, however, did not review the inputs for superficial radiation therapy procedures, and therefore, did not assess whether changes in its valuation were appropriate in light of this bundling. Some stakeholders suggested that the change in the prefatory language precluded them from billing for codes that were previously frequently billed in addition to this code and expressed concern that as a result there would be significant reduction in their overall payments. In the CY 2015 PFS final rule with comment period, we requested information on whether the new radiation therapy code set, combined with modifications in prefatory text, allowed for appropriate reporting of the services associated with superficial radiation and whether the payment continued to reflect the relative resources required to furnish superficial radiation therapy services.

In response to our request, we received a recommendation from a stakeholder to make adjustments to both the work and PE components for CPT code 77401. The stakeholder suggested that since crucial aspects of the service, such as treatment planning and device design and construction, were not currently reflected in CPT code 77401, and practitioners were precluded from reporting these activities separately, additional work should be included for CPT code 77401. Additionally, the stakeholders suggested that the current inputs used to value the code are not accurate because the inputs include zero work and minutes for a radiation therapist to provide the service directly to the patient. The stakeholders suggested, alternatively, that physicians, not radiation therapists, typically provide superficial radiation services directly. Finally, stakeholders also suggested that we amend the direct PE inputs by including nurse time and updating the price of the capital equipment used in furnishing the service.

In response, we solicited recommendations from stakeholders, including the RUC, regarding whether or not it would be appropriate to add physician work for this service and remove minutes for the radiation therapists, even though physician work is not included in other radiation treatment services. We believe it would be appropriate to address the clinical labor assigned to the code in the context of the information regarding the work that might be associated with the service. We also solicited information on the possible inclusion of nurse time for this service as part of the comments and/or recommendations regarding work for the service. Lastly, we reviewed the invoices submitted in response to our request to update the capital equipment for the service.

We proposed to update the equipment item ER045 “orthovoltage radiotherapy system” by renaming it “SRT-100 superficial radiation therapy system” and update the price from $140,000 to $216,000, on the basis of the submitted invoices. The proposed PE RVUs displayed in Addendum B on the CMS Web site were calculated with this proposed modification that was displayed in the CY 2016 direct PE input database.

Comment: Multiple commenters from various specialty societies responded to our request for comment. Several stated that there was work in 77401, while other commenters stated that there was not. One commenter suggested that CMS create a G-code to account for work, while another commenter stated that 77401 should be resurveyed by the RUC.

Response: Given the disagreement among commenters on the work involved in furnishing CPT code 77401, we are considering the possibility of creating a code to describe total work associated with the course of treatment for these services and are seeking additional information on alternatives descriptions and valuations for a code describing this work for consideration in future rulemaking.

Comment: A few commenters pointed out that the description of equipment item ER045 as proposed, “SRT-100 superficial radiation therapy system,” is a particular item that might better be identified generically as “superficial radiation therapy system.”

Response: We agree with the commenter's suggestion and have updated the direct PE input database accordingly.

Comment: A few commenters thanked CMS for updating the price of the superficial radiation therapy system.

Response: We appreciate the support for our proposal.

After considering the comments, we are finalizing the update to ER045 as proposed.

c. Advance Care Planning Services

For CY 2015, the CPT Editorial Panel created two new codes describing advance care planning (ACP) services: CPT code 99497 (Advance care planning including the explanation and discussion of advance directives such as standard forms (with completion of such forms, when performed), by the physician or other qualified health professional; first 30 minutes, face-to-face with the patient, family member(s) and/or surrogate); and an add-on CPT code 99498 (Advance care planning including the explanation and discussion of advance directives such as standard forms (with completion of such forms, when performed), by the physician or other qualified health professional; each additional 30 minutes (List separately in addition to code for primary procedure)). In the CY 2015 PFS final rule with comment period (79 FR 67670-71), we assigned a PFS interim final status indicator of “I” (Not valid for Medicare purposes. Medicare uses another code for the reporting and payment of these services) to CPT codes 99497 and 99498 for CY 2015. We said that we would consider whether to pay for CPT codes 99497 and 99498 after we had the opportunity to go through notice and comment rulemaking.

In the CY 2016 PFS proposed rule, for CY 2016 we proposed to assign CPT codes 99497 and 99498 PFS status indicator “A,” which is defined as: “Active code. These codes are separately payable under the PFS. There will be RVUs for codes with this status. The presence of an “A” indicator does not mean that Medicare has made a national coverage determination regarding the service. Contractors remain responsible for local coverage decisions in the absence of a national Medicare policy.” We proposed to adopt the RUC-recommended values (work RVUs, time, and direct PE inputs) for CPT codes 99497 and 99498 beginning in CY 2016. The services could be paid on the same day or a different day as other E/M services. Physicians' services are covered and paid by Medicare in accordance with section 1862(a)(1)(A) of the Act. Therefore, under our proposal CPT code 99497 (and CPT code 99498 when applicable) would be reported when the described service is reasonable and necessary for the diagnosis or treatment of illness or injury. For example, this could occur in conjunction with the management or treatment of a patient's current condition, such as a 68 year old male with heart failure and diabetes on multiple medications seen by his physician for the E/M of these two Start Printed Page 70956diseases, including adjusting medications as appropriate. In addition to discussing the patient's short-term treatment options, the patient may express interest in discussing long-term treatment options and planning, such as the possibility of a heart transplant if his congestive heart failure worsens and advance care planning including the patient's desire for care and treatment if he suffers a health event that adversely affects his decision-making capacity. In this case the physician would report a standard E/M code for the E/M service and one or both of the ACP codes depending upon the duration of the ACP service. However the ACP service as described in this example would not necessarily have to occur on the same day as the E/M service.

We solicited comment on this proposal, including whether payment is needed and what type of incentives the proposal might create. In addition, we solicited comment on whether payment for advance care planning is appropriate in other circumstances such as an optional element, at the beneficiary's discretion, of the annual wellness visit (AWV) under section 1861(hhh)(2)(G) of the Act.

We received approximately 725 public comments to the proposed rule regarding payment for ACP services. We received comments from individual citizens; several coalitions; professional associations; professional and community-based organizations focusing on end-of-life health care; healthcare systems; major employers; and many individual healthcare professionals working in primary care, geriatrics, hospice/palliative medicine, critical care, emergency medicine and other settings. We also received comments from chaplains, ethicists, advanced illness counseling companies and other interested parties. The majority of commenters expressed support for the proposal, providing recommendations on valuation, the types of professionals who should able to furnish or bill for the services and the appropriate setting of care, intersection with existing codes, the establishment of standards or specialized training, and beneficiary cost sharing and education. Some commenters opposed or expressed provisional support for the proposal because they believed it might create perverse financial incentives relating to termination of patient care. We summarize all of the comments below.

Valuation

Comment: Many commenters supported the separate identification and payment for ACP, either by adopting CPT codes 99497 and 99498 or other unique code(s). Many commenters supported the proposal broadly, advocating for improved Medicare coverage and payment of ACP. Several commenters supported our proposal to adopt the RUC-recommended payment inputs. Several other commenters stated the proposed payment amount was insufficient, and one of these commenters recommended a payment rate equal to the payment for CPT code 99215 (Office or other outpatient visit for the E/M of an established patient) in order to appropriately account for the physician's time.

Response: We appreciate the commenters' support for separate identification and payment for voluntary ACP services. We believe the RUC-recommended inputs accurately reflect the resource costs involved in furnishing the services described by CPT codes 99497 and 99498, and therefore, are finalizing our proposal to adopt the RUC-recommended values for both codes.

Comment: Regarding the time required to furnish ACP services, the commenters cited times ranging from 10 minutes to several hours over multiple encounters, depending on the setting and the patient's condition. Several commenters requested payment for increments of time of less than 30 minutes (for example, 10-15 minutes). One said the services typically require 30-45 minutes of face-to-face time with the patient and family. Several commenters recommended payment for services lasting less than 30 minutes, for example, by pro-rating the add-on code.

Response: We believe the CPT codes describe time increments that are appropriate for furnishing ACP services in various settings. Therefore we are finalizing our proposal to adopt the CPT codes and CPT provisions regarding the reporting of timed services.

Comment: Many commenters recommended that CMS issue a national coverage decision to avoid any local variation in coverage.

Response: We believe it may be advantageous to allow time for implementation and experience with ACP services, including identification of any variation in utilization, prior to considering a controlling national coverage policy through the National Coverage Determination process (see 78 FR 48164, August 7, 2013). By including ACP services as an optional element of the AWV (for both the first visit and subsequent visits), as discussed below, this rule creates an annual opportunity for beneficiaries to access ACP services should they elect to do so.

Comment: Many commenters recommended limits on utilization to prevent abuse, while others recommended no utilization limits in order to increase access and ensure periodic updates to advance care plans. Several commenters were concerned that the lack of utilization limits would lead to practitioners harassing patients.

Response: In general, we do not agree with the commenters who suggested that this service is more likely to be subject to overutilization or abuse than other PFS services without our adoption of explicit frequency limitations. We believe the CPT codes describe time increments that are appropriate for furnishing ACP services in various settings. Therefore, we are finalizing our proposal to adopt the CPT codes and CPT provisions regarding the reporting of timed services. Since the services are by definition voluntary, Medicare beneficiaries may decline to receive them. When a beneficiary elects to receive ACP services, we encourage practitioners to notify the beneficiary that Part B cost sharing will apply as it does for other physicians' services (except when ACP is furnished as part of the AWV, see the discussion below). We plan to monitor utilization of the new CPT codes over time to ensure that they are used appropriately.

Intersection With Other Services

Comment: Many commenters supported our proposal to pay for ACP services when furnished either on the same day or a different day than other E/M services. Several commenters asked CMS to specify whether and how the ACP codes could be billed in conjunction with E/M visits or services that span a given time period, such as 10- or 90-day global codes or Transitional Care Management (TCM) and Chronic Care Management (CCM) services. One commenter recommended that CMS unbundle ACP services from critical care services and pay at a higher rate, but did not suggest an alternative payment amount.

Response: We believe that CPT guidance for these codes is consistent with the description and recommended valuation of the described services. When adopting CPT codes for payment, we generally also adopt CPT coding guidance. In this case, CPT instructs that CPT codes 99497 and 99498 may be billed on the same day or a different day as other E/M services, and during the same service period as TCM or CCM services and within global surgical periods. We are also are adopting the CPT guidance prohibiting the reporting of CPT codes 99497 and 99498 on the same date of service as certain critical care services including neonatal and pediatric critical care.Start Printed Page 70957

Who Can Furnish/Setting of Care

Comment: Many commenters who supported the proposal provided recommendations regarding which practitioners and support staff should be able to provide or be paid for ACP services. Many commenters sought clarification regarding who would qualify as the “other health care professionals” described by or able to bill the CPT codes. Many commenters described ACP services as being routinely provided by a multidisciplinary team under physician supervision. For example, they stated that ACP is routinely provided by physicians, non-physician practitioners and other staff under the order and medical management of the beneficiary's treating provider. They stated that often a team approach is used, involving coordination between the beneficiary's physicians, non-physician practitioners (such as licensed clinical social workers or clinical nurse specialists) and other licensed and credentialed hospital staff such as registered nurses.

Similarly, other commenters described social workers, clinical psychologists, registered nurses, chaplains and other individuals as appropriate providers of ACP services, either alone or together with a physician, and recommended payment for the services of these individuals. For example, one commenter stated that a significant portion of ACP discussions occur between patients and registered nurses or allied health professionals functioning as care coordinators, care navigators or similar roles; that a growing proportion are performed at home; and that CMS should enable care coordinators and navigators to bill the ACP codes either by defining them as “other qualified health professionals” or under “incident to” provisions.

Some commenters specifically recommended allowing social workers and chaplains qualified under the hospice benefit to bill the ACP codes. One community oncologist association stated that best practices have evolved to include a multi-disciplinary approach utilizing trained physician, advanced practice provider and social worker skill sets, and that nearly half of their oncology network's ACP is performed by licensed clinical social workers. This commenter stated that while it is typical for a physician to initiate the ACP discussion with patients, ACP usually occurs with a mid-level provider or social worker and therefore the association requested that CMS allow clinical social workers to bill for these services. Another national association stated that it was working towards the development of new CPT codes for practitioners such as social workers who the commenter believed would not be able to directly bill the proposed codes.

Some commenters argued that such non-medically trained individuals are qualified and have special training and expertise (whether psychosocial, spiritual or legal) that are needed on ACP care teams. Some believed that ACP is sometimes appropriate for physicians to perform, but that physicians do not have enough time to supply all of the demand for ACP services. Some commenters similarly argued that inclusion of social workers and other non-medically trained individuals including Spiritual Directors, Chaplains, Clinical Pastoral Counselors and others would alleviate concerns about undue influence over patient decisions. These commenters stated that part of the ACP conversation is emotional and spiritual and not merely clinical, so it is important to include individuals who can address the non-clinical aspect of ACP. Some commenters argued that widening the field of professionals who can initiate these conversations within their scope of practice will further encourage appropriate and frequent ACP. Several commenters stated that physicians should not be paid for ACP services due to an ethical or financial conflict of interest, and that communities should take more responsibility for these services.

In contrast, several commenters were concerned that allowing ACP to be paid to certain trained facilitators would undermine physician authority in treating patients. These commenters described the use of trained facilitators in certain community models that offer group discussions by trained lay and health professionals. These commenters were concerned that such facilitators would qualify as “other qualified professionals” under the CPT code descriptor and be given control over ACP, shaping physician behavior. One commenter stated that to prevent coercion of patients, it would be better if payment was limited to non-employees of hospitals.

Response: We appreciate the many comments we received on existing or recommended practice patterns for the provision of ACP services. We acknowledge the broad range of commenters that stated that the services described by CPT codes 99497 and 99498 are appropriately provided by physicians or using a team-based approach provided by physicians, non-physician practitioners and other staff under the order and medical management of the beneficiary's treating physician. We note that the CPT code descriptors describe the services as furnished by physicians or other qualified health professionals, which for Medicare purposes is consistent with allowing these codes to be billed by the physicians and NPPs whose scope of practice and Medicare benefit category include the services described by the CPT codes and who are authorized to independently bill Medicare for those services. Therefore only these practitioners may report CPT codes 99497 or 99498. We note that as a physicians' service, “incident to” rules apply when these services are furnished incident to the services of the billing practitioner, including a minimum of direct supervision. We agree with commenters that advance care planning as described by the proposed CPT codes is primarily the provenance of patients and physicians. Accordingly we expect the billing physician or NPP to manage, participate and meaningfully contribute to the provision of the services, in addition to providing a minimum of direct supervision. We also note that the usual PFS payment rules regarding “incident to” services apply, so that all applicable state law and scope of practice requirements must be met in order to bill ACP services.

Comment: Several commenters recommended that CMS not require direct supervision for ACP services or allow it to be furnished “incident to” under general supervision.

Response: As discussed above, we understand that the services described by CPT codes 99497 and 99498 can be provided by physicians or using a team-based approach where, in addition to providing a minimum of direct supervision, the billing physician or NPP manages, participates and meaningfully contributes to the provision of the services. We note that the “incident to” rules apply when these services are provided incident to the billing practitioner, including direct supervision. We do not believe it would be appropriate to create an exception to allow these services to be furnished incident to a physician or NPP's professional services under less than direct supervision because the billing practitioner must participate and meaningfully contribute to the provision of these face-to-face services.

Comment: Many commenters made recommendations regarding the settings of care that would be appropriate for payment of ACP services. Some of these commenters specified that payment should be made in both ambulatory and inpatient settings. Many commenters stated that ACP is ideally performed in Start Printed Page 70958a primary care setting, where the patient has a longstanding relationship with a physician and can engage in planning prior to illness, at which time they may be most receptive and most likely to have full decision making capacity. However many commenters believed payment was also appropriate in inpatient and other acute care settings. A few commenters recommended payment for an outpatient code or a code that would not be payable in the intensive care setting. Some commenters recommended that ACP should only be payable in clinical settings and that CMS should explicitly exclude group information sessions and similar offerings. Commenters stated that patients should be able to choose any location for ACP services including at home; in community-based settings; or via telehealth, telephone or other remote technologies. A few commenters were concerned that CMS might limit payment to certain specialists and recommended against such a policy.

Response: We agree with commenters that ACP services are appropriately furnished in a variety of settings, depending on the condition of the patient. These codes will be separately payable to the billing physician or practitioner in both facility and non-facility settings and are not limited to particular physician specialties. We refer commenters to the CY 2016 hospital outpatient prospective payment system final rule with comment period for a discussion of how payment will be made to hospitals for ACP services furnished in hospital outpatient departments.

Comment: Many commenters supported payment for ACP along the entire health continuum, in advance of acute illness, and revisiting the advance care plan with changes in the patient's condition. These commenters stated ACP is a routine service that should be regularly performed like preventive services. These commenters responded affirmatively to our solicitation as to whether or not ACP services should be included as an optional element, at the beneficiary's discretion, of the annual wellness visit (AWV) under section 1861(hhh)(2)(G) of the Act. Several of these commenters specified that ACP should remain separately paid even if included as an optional element of the AWV.

Response: We appreciate the response of commenters regarding our request for comment on whether or not we should include ACP as an optional element, at the beneficiary's discretion, of the annual wellness visit (AWV) under section 1861(hhh)(2)(G) of the Act. Based on the commenters' positive response to this solicitation, we are adding ACP as a voluntary, separately payable element of the AWV. We are instructing that when ACP is furnished as an optional element of AWV as part of the same visit with the same date of service, CPT codes 99497 and 99498 should be reported and will be payable in full in addition to payment that is made for the AWV under HCPCS code G0438 or G0439, when the parameters for billing those CPT codes are separately met, including requirements for the duration of the ACP services. Under these circumstances, ACP should be reported with modifier -33 and there will be no Part B coinsurance or deductible, consistent with the AWV.

Regarding who can furnish ACP when it is furnished as an optional element of the AWV, we note that AWV cannot be furnished as an “incident to” service since the AWV has a separate, distinct benefit category from “incident to” services. However, the current regulations for the AWV allow the AWV to be furnished under a team approach by physicians or other health professionals under direct supervision. Therefore, the rules that apply to the AWV will also apply to ACP services when furnished as an optional element of the AWV, including the requirement for direct supervision.

Comment: We received several comments requesting that ACP be added as a billable visit for FQHCs, and several comments requesting that we ensure that Medicare Administrative Contractors (MACs) are aware that a standalone ACP counseling session with an FQHC billable provider qualifies as a “billable visit” under Medicare's Prospective Payment System (PPS) for FQHCs.

Response: RHCs and FQHCs furnish Medicare Part B services and are paid in accordance with the RHC all-inclusive rate system or the FQHC PPS. Beginning on January 1, 2016, ACP will be a stand-alone billable visit in a RHC or FQHC, when furnished by a RHC or FQHC practitioner and all other program requirements are met. If furnished on the same day as another billable visit, only one visit will be paid. Coinsurance will be applied for ACP when furnished in an FQHC, and coinsurance and deductibles will be applied for ACP when furnished in an RHC. Coinsurance and deductibles will be waived when ACP is furnished as part of an AWV. Additional information on RHC and FQHC billing of ACP will be available in sub-regulatory guidance.

Standards/Training

Comment: Many commenters recommended that CMS establish standards or require specialized training as a condition of payment for ACP services. Many commenters recommended standards or special training in relevant state law and advance planning documents; content and time; communication, representation, counseling, shared decision making and skills outside the scope of physician training. Several commenters recommended standards regarding the use of certified electronic health record technology; contractual or employment relationships with nurses, social workers and other clinical staff working as part of an ACP team; use of written protocols and workflows to make ACP part of routine care; and working with professional societies and other organizations including the National Quality Forum and the Agency for Healthcare Research & Quality to establish quality standards for clinician-patient communication and ACP that would be tied to payment. Many commenters recommended policies to ensure documentation and transmission of the results of ACP among health care providers. Some of these commenters encouraged CMS to use technology to enhance the use and portability of advance directives across care settings and state lines, or recommended a universal registry.

Several commenters were concerned about the nature of the services that would be payable under the proposed codes, noting that ACP should extend beyond education about advance directives and completing forms. Several recommended the development of content criteria or quality measures to ensure that ACP services are meaningful and of value to patients. Some commenters expressed concern about ensuring appropriate services were furnished as part of ACP. For example, they expressed concern that payable services would include mere group information sessions, filling out forms or similar offerings. One commenter recommended that CMS require some minimal element like one personal real-time encounter, whether face-to-face or by phone or telemedicine.

Response: Since CPT codes 99497 and 99498 describe face-to-face services, we do not believe it would be appropriate at this time to apply additional payment standards as we have for certain non-face-to-face services such as CCM services. We will continue to consider whether additional standards, special training or quality measures may be appropriate in the future as a condition of Medicare payment for ACP services. We note that we did not propose to add ACP services to the list of Medicare telehealth services, so the face-to-face Start Printed Page 70959services described by the codes need to be furnished in-person in order to be reported to Medicare.

Comment: Several commenters supported advance care planning between patients and clinicians, but expressed concern about the potential for bias against choosing treatment options involving living with disability, requiring physicians to discuss questionable treatment options (such as physician assisted suicide or other patient choices that might violate individual physician ethics) and similar issues. Some commenters were concerned that patients might change their decisions once care was actually needed and be unable to override previous advance directives; or that the government would be making healthcare decisions instead of patients, physicians, and families.

Response: As discussed above, based on public comments we received, we believe the services described by CPT codes 99497 and 99498 are appropriately provided by physicians or using a team-based approach where ACP is provided by physicians, non-physician practitioners and other staff under the order and medical management of the beneficiary's treating physician. We also note that the CPT code descriptors describe the services as furnished by physicians or other qualified health professionals, which for Medicare purposes, is consistent with allowing these codes to be billed by the physicians and NPPs whose scope of practice and Medicare benefit category include the services described by the CPT codes and who are authorized to independently bill Medicare for those services. Therefore only these practitioners may report CPT codes 99497 or 99498, and “incident to” rules apply when these services are provided incident to the services of the billing practitioner under a minimum of direct supervision. We agree with commenters that advance care planning as described by the new CPT codes is primarily the provenance of patients and physicians. Accordingly we expect the billing physician or NPP, in addition to providing a minimum of direct supervision, to manage, participate and meaningfully contribute to the provision of the services. Also, we note that PFS payment rules apply when ACP is furnished incident to other physicians' services, including where applicable, that state law and scope of practice must be met. Since the ACP services are by definition voluntary, we believe Medicare beneficiaries should be given a clear opportunity to decline to receive them. We note that beneficiaries may receive assistance for completing legal documents from other non-clinical assisters outside the scope of the Medicare program. Nothing in this final rule with comment period prohibits beneficiaries from seeking independent counseling from other individuals outside the Medicare program—either in addition to, or separately from, their physician or NPP.

Beneficiary Considerations

Comment: Several commenters suggested that CMS pursue waivers of cost sharing for ACP services or that cost sharing should vary by the condition of the patient.

Response: We lack statutory authority to waive beneficiary cost sharing for ACP services generally because they are not preventive services assigned a grade of A or B by the United States Preventive Services Task Force (USPSTF); nor may CMS vary cost sharing according to the patient's diagnosis. Under current law, the Part B cost sharing (deductible and coinsurance) will be waived when ACP is provided as part of the AWV, but we lack authority to waive cost sharing in other circumstances. We would recommend that practitioners inform beneficiaries that the ACP service will be subject to separate cost sharing.

Comment: One commenter recommended beneficiary education through Medicare & You, partnerships with senior advocacy groups and other means.

Response: We agree that beneficiary education about ACP services, especially the voluntary nature of the services, is important. We welcome such efforts by beneficiary advocacy and community-based organizations and will consider whether additional material should be added to the Medicare & You handbook to highlight new payment provisions for these voluntary services.

In summary, we are finalizing our proposal to assign CPT codes 99497 and 99498 PFS status indicator “A” with RVUs developed based on the RUC-recommended values. We are also adding ACP as an optional element, at the beneficiary's discretion, of the AWV. We are also making the conforming changes to our regulations at § 410.15 that describe the conditions for and limitations on coverage for the AWV.

We note that while some public commenters were opposed to Medicare paying for ACP services, the vast majority of comments indicate that most patients desire access to ACP services as they prepare for important medical decisions.

d. Valuation of Other Codes for CY 2016

(1) Excision of Nail Bed (CPT Code 11750)

CPT code 11750 appeared on the RUC's misvalued code screen of 10-day global services with greater than 1.5 office visits and utilization over 1,000. The Health Care Professional Advisory Committee (HCPAC) reviewed the survey results for valuing this code and determined that 1.99 work RVUs, corresponding to the 25th percentile survey result, was the appropriate value for this service. As discussed in the proposed rule, we indicated that we believed the recommendation for this service overstated the work involved in performing this procedure, specifically, given the decrease in post-operative visits. Due to similarity in service and time, we indicated that we believed a direct crosswalk from the work RVU for CPT code 10140 (Drainage of blood or fluid accumulation), which is also a 10-day global service with one post-operative visit, more accurately reflects the time and intensity of furnishing the service. Therefore, for CY 2016 we proposed a work RVU of 1.58 for CPT code 11750.

The following is a summary of the comments we received on our proposal.

Comment: One commenter disagreed with CMS' direct crosswalk of the work RVU from CPT code 10140 to CPT code 11750. The commenters suggested that CMS establish the RVU for this procedure consistent with the recommendation. Additionally, the commenter stated that the HCPAC recommendation accounted for the removal of one post-operative visit from the global period. The commenter also stated that CMS' proposed work RVU would have an intraservice work intensity similar to a level one E/M visit (99211), which suggests that the value is too low.

Response: In developing our proposed RVUs for this service, we reviewed codes with similar intra-service and total times, and identified CPT code 11760 (Repair of nail bed) and CPT code 11765 (Excision of nail fold toe). Since we believe that the crosswalk for CPT code 11750 has similar intensity, and our proposed RVU is consistent with these similar services, we do not agree with the commenter who states that the proposed work RVU is inaccurate.

After consideration of comments received, we are finalizing a work RVU of 1.58 for CPT code 11750, as proposed.Start Printed Page 70960

(2) Bone Biopsy Excisional (CPT Code 20240)

In its review of 10-day global services, the RUC identified CPT code 20240 as potentially misvalued. Subsequent to this identification, the RUC requested that CMS change this code from a 10-day global period to a 0-day global period for this procedure. Based on survey data, the RUC recommended a decrease in the intraservice time from 39 to 30 minutes, removal of two postoperative visits (one 99238 and one 99212), and an increase in the work RVUs for CPT code 20240 from 3.28 to 3.73. In the proposed rule, we stated that we did not believe the RUC recommendation accurately reflected the work involved in this procedure, especially given the decrease in intraservice time and post-operative visits relative to the previous assumptions used in valuing the service. Therefore, for CY 2016, we proposed a work RVU of 2.61 for CPT code 20240 based on the reductions in time for the service.

The following is a summary of the comments we received on our proposal.

Comment: Several commenters, including the RUC, recommended that CMS reconsider its decision not to accept the RUC's recommendation for CPT code 20240. The commenters noted that the service was last valued by the Harvard study over 20 years ago and the assumptions made at the time no longer reflect current practice as the survey respondents included fewer than 10 non-orthopedic surgeons. Commenters stated that podiatry is currently the dominant provider of the service. Commenters also stated that deriving a new proposed work RVU based on existing work RVUs would be misguided in this case.

The commenters also suggested that using a reverse building block methodology to convert a 10-day global code to 0-day global code by removing the bundled E/M services is inappropriate since magnitude estimation was used initially when establishing the work RVUs for surgical codes. Several commenters indicated that CMS' proposed work RVU has inappropriately low work intensity and expressed concern about CMS' approach to global code conversion.

Additionally, the RUC expressed disagreement with CMS' decision to remove 6 minutes of clinical labor minutes for discharge management time from 0-day global services stating there is clinical staff time that needs to be accounted for; the commenter requested we include the 6 minutes of clinical labor time based on the standard clinical labor task “conduct phone calls/call in prescriptions.”

Response: In proposing what we believed to be a more accurate value for CPT code 20240, we considered applying the intra-service ratio, which yielded a value of 2.52 RVUs; however we believed that value would have inadequately reflected the work involved in furnishing the service. Instead, we opted to use the reverse building block methodology to remove the post-operative visits, acknowledging the transition from a 10-day to a 0-day global period. We removed the RVUs associated with the visits (1.12 RVUs) from the RUC-recommended value of 3.73 RVUs and arrived at an RVU of 2.61, which we continue to believe accurately accounts for work involved in furnishing the service. While we generally understand that the work RVUs may not have been developed using a building-block methodology, and that the reverse building block methodology may not always be the best approach to valuing services, we do not agree that significant changes in the post-operative period should be ignored, especially since we note that the RUC uses magnitude estimation to develop recommended work RVUs in the context of survey data regarding the number and level of visits in the post-operative periods.

In terms of the clinical labor minutes associated with the discharge day management, we do not agree that the typical discharge work associated for this service or for others without work time for discharge day management would typically involve clinical staff conducting phone calls regarding prescriptions. We are aware that some codes include the clinical labor minutes for discharge management even though the work time for these codes do not include time for discharge management. We are seeking comment on how we might address this discrepancy in future rulemaking.

After consideration of comments received, we are finalizing the proposed work RVU of 2.61 for CPT code 20240.

(3) Endobronchial Ultrasound (CPT Codes 31622, 31652, 31653, 31625, 31626, 31628, 31629, 31654, 31632 and 31633)

For CY 2016, the CPT Editorial Panel deleted one code, CPT code 31620 (Ultrasound of lung airways using an endoscope), and created three new codes, CPT codes 31652-31654, to describe bronchoscopic procedures that are inherently performed with endobronchial ultrasound (EBUS).

In their review of the newly revised EBUS family, the RUC recommended a change in the work RVUs for CPT code 31629 from 4.09 to 4.00. The RUC also recommended maintaining the current work RVUs for CPT codes 31622, 31625, 31626, 31628, 31632 and 31633. We proposed to use those work RVUs for CY 2016.

For the newly created codes, the RUC recommended work RVUs of 5.00 for CPT code 31652, 5.50 for CPT code 31653 and 1.70 for CPT code 31654. In the proposed rule, we stated that we believe the RUC-recommended work RVUs for these services overstate the work involved in furnishing the procedures. In order to develop proposed work RVUs for CPT code 31652, we compared the service described by the code descriptor to deleted CPT codes 31620 and 31629, because this new code describes a service that combines services described by CPT code 31620 and 31629. Specifically, we took the sum of the current work RVU of CPT code 31629 (WRVU = 4.09) and the CY 2015 work RVU of CPT code 31620 (WRVU = 1.40) and multiplied it by the quotient of CPT code 31652's RUC-recommended intraservice time (INTRA = 60 minutes) and the sum of CPT codes 31620 and 31629's current and CY 2015 intraservice times (INTRA = 70 minutes), respectively. This resulted in a proposed work RVU of 4.71. To value CPT code 31653, we used the RUC-recommended increment of 0.5 work RVUs between this service and CPT code 31652 to calculate for CPT code 31653 our proposed work RVUs of 5.21. Lastly, because the service described by new CPT code 31654 is very similar to deleted CPT code 31620, we stated that we believed a direct crosswalk of the previous values for CPT code 31620 accurately reflected the time and intensity of furnishing the service described by CPT code 31654. Therefore, we proposed a work RVU of 1.40 for CPT code 31654.

The following is a summary of the comments we received on our proposals.

Comment: Several commenters, including the RUC, stated they did not agree with CMS' calculations or methodology utilized in valuing these services. The commenters suggested that CMS' calculations were based on inconsistent data. One commenter stated the methodology outlined in the proposed rule had several flaws in the understanding of the new and deleted bronchoscopy codes and questioned what purpose the creation of the new bundled codes were designed to address.

Response: As we have addressed more broadly, when we do not believe that Start Printed Page 70961the RUC-recommended values adequately address changes in the time resources required to furnish particular services, we have used several methodologies to identify potential work RVUs. We examine the results of such approaches and consider whether or not these results appropriately account for the total work of the service. We continue to believe that the methodology used to calculate the proposed work RVU is the most appropriate methodology to use for these procedures.

Specifically, in considering CPT code 31652 in the context of similar codes, including CPT code 31638 (Bronchoscopy, rigid or flexible, including fluoroscopic guidance, when performed; with revision of tracheal or bronchial stent inserted at previous session (includes tracheal/bronchial dilation as required)) and CPT code 31661(Bronchoscopy, rigid or flexible, including fluoroscopic guidance, when performed; with bronchial thermoplasty, 2 or more lobes) both of which have 60 minutes of intraservice time and RVUs of 4.88 and 4.50, we continue to believe that a work RVU of 4.71 is the most accurate valuation. For CPT code 31653, we continue to believe that maintaining the RUC-recommended 0.5 work RVU increment between 31652 and 31653 yields the most accurate value for CPT code 31653. For CPT code 31654, we note the direct crosswalk preserves the work RVU of 1.40 from the previous CPT code 31620, which was also an add-on code, and had more intraservice time. Therefore, after consideration of comments received, we are finalizing the work RVUs for CPT codes 31622, 31652, 31653, 31625, 31626, 31628, 31629, 31654, 31632 and 31633 for CY 2016 as proposed.

Comment: One commenter also expressed appreciation of CMS' acceptance of the RUC's PE recommendation for several codes in this family.

Response: We appreciate the support of the commenter.

Comment: In its comment, the RUC indicated that equipment items ES045 and ES016 were incorrectly included for 31652, 31653, and 31654 and that these items were replaced with new equipment codes. In the CY 2015 Technical Correction Notice (CMS-1612-F2), equipment item ES015 was included in 31654, and the clinical labor direct PE inputs for 31654 were omitted from the direct PE input database. Similarly, for CPT code 31629, the RUC indicated that CMS proposed 30 minutes for clinical labor tasks “assist physician in performing procedure” and “assist physician for moderate sedation”, as included in the CY 2016 proposed direct PE input database, while the RUC had recommended 35 minutes. The RUC opined that since the 30 minutes displayed for CPT code 31629 was incorrect, all of the corresponding equipment times included discrepancies of 5 minutes. The RUC suggested that all equipment times should increase by 5 minutes, excluding the stretcher, which should remain 89 minutes as that equipment is not needed during the intraservice portion of the procedure. In addition, the RUC suggested that the calculation of supply item “gas, oxygen” (SD084) would also be affected by the “assist physician” time and should be 105 liters, rather than 90 liters as currently indicated in the supply direct PE input CMS file.

Response: We agree with the RUC's comments regarding the proposed direct PE inputs for these procedures; the resulting changes appear in the final direct PE input database for CY 2016.

(4) Intravascular Ultrasound (CPT Codes 37252 and 37253)

In the CY 2015 PFS proposed rule, a stakeholder requested that CMS establish non-facility PE RVUs for CPT codes 37250 and 37251. CMS sought comment regarding the setting and valuation of these services. In September 2014, these codes were referred to the CPT Editorial Panel. The CPT Editorial Panel deleted CPT codes 37250 and 37251 and created new bundled codes 37252 and 37253 to describe intravascular ultrasound (IVUS). The RUC recommended 1.80 RVUs for CPT code 37252 and 1.44 RVUs for CPT code 37253. The RUC also recommended new direct PE inputs for an IVUS catheter and IVUS system. CMS proposed to accept the RUC-recommended work RVUs for intravascular ultrasound.

Comment: Commenters expressed support for CMS' proposed work and time values, as well as for updating the direct PE inputs.

Response: We appreciate commenters' support, and we are finalizing these values as proposed.

(5) Laparoscopic Lymphadenectomy (CPT Codes 38570, 38571 and 38572).

The RUC identified three laparoscopic lymphadenectomy codes as potentially misvalued: CPT code 38570 (Laparoscopy, surgical; with retroperitoneal lymph node sampling (biopsy), single or multiple); CPT code 38571 (Laparoscopy, surgical; with retroperitoneal lymph node sampling (biopsy), single or multiple with bilateral total pelvic lymphadenectomy); and CPT code 38572 (Laparoscopy, surgical; with retroperitoneal lymph node sampling (biopsy), single or multiple with bilateral total pelvic lymphadenectomy and periaortic lymph node sampling (biopsy), single or multiple). Accordingly, the specialty society surveyed these 10-day global codes, and the survey results indicated decreases in intraservice and total work times. After reviewing the survey responses, the RUC recommended that CMS maintain the current work RVU for CPT code 38570 of 9.34; reduce the work RVU for CPT code 38571 from 14.76 to 12.00; and reduce the work RVU for CPT code 38572 from 16.94 to 15.60. We used the RUC recommendations to propose values for CPT codes 38571 and 38572, since the RUC recommended reductions in the work RVUs that correspond with marked decreases in intraservice time and decreases in total time. As discussed in the proposed rule, we did not agree with the RUC's recommendation to maintain the current work RVU for CPT code 38570 in spite of similar changes in intraservice and total times as were shown in the RUC recommendations for CPT codes 38571 and 38572. Therefore, we proposed a work RVU for CPT code 38570 of 8.49, which reflects the proportional reduction in total time for this code and maintains the rank order among the three codes.

The following is a summary of the comments we received on our proposals.

Comment: Several commenters, including the RUC, indicated that CMS should use the recommended work RVU of 9.34 for CPT code 38570. Commenters stated that CMS used an erroneous calculation to derive the proposed work RVU of 8.49, with the use of time ratios being methodologically flawed due to an assumption that the existing time is correct, that physician intensity would remain constant for a service over a period of many years, and that different components of total time consisting of differing levels of physician intensity cannot be measured together. Commenters stated that using this rationale as the basis for not accepting the RUC recommendation was unprecedented and misguided.

Commenters also stated that the recommended work RVU of 9.34 was based on work time and a comparison to CPT codes 31239 (Nasal/sinus endoscopy, surgical; with dacryocystorhinostomy) and 50590 (Lithotripsy, extracorporeal shock wave). Commenters indicated that the comparison to these codes confirmed Start Printed Page 70962that maintaining the current value for CPT code 38570 would be appropriate. A different commenter stated that the survey time for this procedure had increased to 280 minutes and included a hospital inpatient visit. This commenter also urged CMS to maintain the current work RVUs of 9.34 for CPT code 38570.

Response: We refer the reader to our earlier discussion about time ratios. We continue to believe that the use of time ratios is one of several reasonable methods for identifying potential work RVUs for particular PFS services, particularly when the alternative values do not account for information that suggests the amount of time involved in furnishing the procedure has changed significantly. In the case of CPT code 38570, we noted that the intraservice time was reduced by 50 percent, from 120 minutes to 60 minutes, and the total time was also reduced from 242 minutes to 220 minutes. We also noted that the other codes in the same family, CPT codes 38571 and 38572, reflected similar time reductions and consequently had reduced recommended work RVUs. We believe that in order to maintain relativity, it is appropriate to apply a similar reduction to the work RVUs of CPT code 38570.

We were unable to find mention of CPT code 31239 in the RUC recommendations for 38570. Therefore, we considered the values for the code as a potential rationale for using the RUC-recommended value for CPT code 38570. We concluded that CPT code 31239 has limited utility as a comparison, since its values appear to be an outlier among codes with similar characteristics. For example, all 25 of the other 10-day global codes with 60 minutes of intraservice time have a lower work RVU than CPT code 38570, most of them substantially lower, with CPT code 49429 (Removal of peritoneal-venous shunt) having the next highest work RVU of 7.44. We also do not agree with the comparison to CPT code 50590, since that code describes all of the work within a 90-day global period, and we do not believe that relativity between services would be preserved if we were to make direct work RVU comparisons between 10-day and 90-day global codes.

After consideration of comments received, we are finalizing our proposed work RVUs of 8.49 for CPT code 38570, 12.00 for CPT code 38571, and 15.60 for CPT code 38572.

(6) Mediastinoscopy With Biopsy (CPT Codes 39401 and 39402)

The RUC identified CPT code 39400 (Mediastinoscopy, including biopsy(ies) when performed) as a potentially misvalued code due to an unusually high preservice time and Medicare utilization over 10,000. In reviewing the code's history, = the CPT Editorial Panel concluded that the code had been used to report two distinct procedural variations although the code was valued using a vignette for only one of them. As a result, CPT code 39400 is being deleted and replaced with CPT codes 39401 and 39402 to describe each of the two mediastinoscopy procedures.

We proposed to accept the RUC-recommended work RVU of 5.44 for code 39401 and to use the RUC-recommended crosswalk from CPT code 52235 (Cystourethroscopy, with fulguration), which accurately estimates the overall work for CPT code 39401. In the proposed rule, we disagreed with the RUC-recommended work RVU of 7.50 for CPT code 39402. We stated that the work RVU for CPT code 39401 establishes an accurate baseline for this family of codes, so we proposed to scale the work RVU of CPT code 39402 in accordance with the change in the intraservice times between CPT codes 39401 and 39402. We indicated that applying this ratio in the intraservice time to the work RVU of CPT code 39401 yielded a total work RVU of 7.25 for CPT code 39402. We also noted that the RUC recommendation for CPT code 39401 represented a decrease in value by 0.64 work RVUs, which is roughly proportionate to the reduction from a full hospital discharge visit (99238) to a half discharge visit assumed to be typical in the post-operative period. The RUC recommendation for CPT code 39402 had the same reduction in the post-operative work without a corresponding decrease in its recommended work RVU. In order to reflect the reduction in post-operative work and to maintain relativity between the two codes in the family, we proposed a work RVU of 7.25 for CPT code 39402.

The following is a summary of the comments we received on our proposals.

Comment: Several commenters stated that the use of intraservice time ratios was inappropriate for valuation of CPT codes. They indicated that CMS should instead use the RUC's recommended work RVU of 7.50, due to the difference in technical skill, physical/mental effort, and additional stress involved in the performance of CPT code 39402 relative to CPT code 39401. Commenters expressed the importance of using physician survey data and magnitude estimation to arrive at work RVUs.

Response: We refer the reader to our earlier discussions about the utility of time ratios in identifying potential work RVUs for PFS services. We note that when comparing the work RVUs for CPT codes 39401 and 39402, the work RVU for CPT code 39402 was higher than would be expected based on the difference in time between these two procedures, even considering the more difficult clinical nature of CPT code 39402. We continue to believe that the use of intraservice time ratios is one of several different methods that can be effectively employed for valuation of CPT codes. For this particular mediastinoscopy family, CPT codes 39401 and 39402 share identical preservice time, postservice time, and office visits. Based on this information, we continue to believe that the intraservice time ratio between the two codes is the most accurate method for determining the work RVU for this procedure.

Comment: Several commenters suggested that CMS should use the RUC-recommended work RVU of 7.50 for CPT code 39402 based on the use of a building block methodology. Commenters stated that the RUC arrived at this value by adding the work RVU of CPT code 39401 (5.44 RVUs) to one half of the work RVU of CPT code 32674 (4.12 RVUs). The resulting calculation of 5.44 plus 2.06 equaled 7.50 RVUs, exactly the same value recommended by the RUC and a proof of the accuracy of magnitude estimation.

Response: We believe that the use of the reverse building block methodology would result in a significantly lower valuation for CPT code 39402. The current CPT code used for a mediastinoscopy with lymph node biopsy is 39400, which has a work RVU of 8.05, and includes three postoperative visits in its global period (a 99231 hospital inpatient visit, a 99238 hospital discharge visit, and a 99213 office visit). CPT code 39402 does not include the hospital inpatient visit (0.76 RVUs) or the office visit (0.97 RVUs), and includes only half of the discharge visit (0.64 RVUs). If the work of these visits were removed from CPT code 39400, the result would be a work RVU of 8.05 − 2.37 = 5.68. We believe that this work RVU understates the work of CPT code 39402, which is why we believe that a building block methodology would be less accurate than the use of the intraservice time ratio for this code family.

After consideration of comments received, we are finalizing our proposed work RVU of 5.44 for CPT code 39401 and 7.25 for 39402.Start Printed Page 70963

(7) Hemorrhoid(s) Injection (CPT Code 46500)

The RUC identified CPT code 46500 (Injection of sclerosing solution, hemorrhoids) as potentially misvalued, and the specialty society resurveyed this 10-day global code. The survey showed a significant decrease in the reported intraservice and total work times. After reviewing the survey responses, the RUC recommended that CMS maintain the current work RVU of 1.69 in spite of the reductions in intraservice and total times. We proposed to reduce the work RVU to 1.42, which reduces the work RVU by the same ratio as the reduction in total time.

We also proposed to refine the RUC-recommended direct PE inputs by removing the inputs associated with cleaning the scope.

The following is a summary of the comments we received on our proposals.

Comment: The RUC disagreed with the methodology CMS used to develop the proposed work RVUs stating that CMS' proposed methodology did not account for differences in pre-service or post-service time. The RUC also stated that different components of total time (preservice time, intra-service time, post-service time, and post-operative visits) consist of differing levels of physician intensity and CMS' calculations did not appear to have been based on any clinical information or any measure of physician intensity.

Another commenter supported our efforts to identify and address such incongruities between work times and work RVUs, stating that when work time decreases, work RVUs should decrease comparatively, absent a compelling argument that the intensity of the service has increased sufficiently to offset the decrease in work time.

One commenter disagreed with CMS' proposed PE refinements for CPT code 46500 regarding the pre-service clinical labor time for the facility setting, clinical labor time related to setting up endoscopy equipment, clinical labor time and supplies related to cleaning endoscopy equipment, equipment time for item ES002, and clinical labor time associated with clinical labor task “follow-up phone calls and prescriptions”. The commenter also disagreed with CMS' refinement of not including setup and clean-up time for the scope at the post-operative visit.

Response: We believe the total time ratio produces an RVU that is comparable with other 10-day global services. We note that CPT code 41825 (Excision of lesion or tumor (except listed above), dentoalveolar structures; without repair) and CPT code 10160 (Puncture aspiration of abscess, hematoma, bulla, or cyst) are similar 10-day global services that have comparable work RVUs. For CY 2016, we are finalizing our proposed value of 1.42 RVUs for CPT code 46500.

After reviewing the public comments that were submitted regarding direct PE inputs, we recognize that we mistakenly believed that a disposable scope was included as a direct PE input, when a reusable equipment item was actually included. As a result, we removed the clinical labor time associated with setting up and cleaning the scope. Since we made this refinement in error, we will restore the clinical labor time associated with setting up and cleaning the scope. We also agree with commenters regarding the time for clinical labor task “follow-up phone calls and prescriptions”. Therefore, we are restoring the RUC-recommended clinical labor times for “follow-up phone calls & prescriptions”, “setup scope (non-facility setting only)”, and “clean scope”. As a result of including the previously removed clinical labor time associated with the equipment input ES002 (anoscope with light source), we are increasing the equipment time for this code from 60 minutes to 70 minutes. We did not add the set-up and clean scope time to the post-operative visits, however, since the clinical labor time for post-operative visits across PFS services match the clinical labor for the associated E/M visits. We are seeking comment regarding whether or not we should reconsider that practice broadly before making an exception in this particular case.

(8) Liver Allotransplantation (CPT Code 47135)

The RUC identified CPT code 47135 (Liver allotransplantation; orthotopic, partial or whole, from cadaver or living donor, any age) as potentially misvalued, and the specialty society resurveyed this 90-day global code. The survey results showed a significant decrease in reported intraservice work time, but a significant increase in total work time (the number of post-operative visits significantly declined while the level of visits increased). After reviewing the survey responses, the RUC recommended an increase in the work RVU from 83.64 to 91.78, which corresponds to the survey median result, as well as the exact work RVU for CPT code 33935 (Heart-lung transplant with recipient cardiectomy-pneumonectomy). In the proposed rule, we stated that we did not believe the RUC-recommended crosswalk was the most accurate from among the group of transplant codes. We noted that CPT code 32854 (Lung transplant, double (bilateral sequential or en bloc); with cardiopulmonary bypass) has intraservice and total times that are closer to those the RUC recommended for CPT code 47135, and CPT code 32854 has a work RVU of 90.00 which corresponds to the 25th percentile survey result for CPT code 47135. Therefore, we proposed to increase the work RVU of CPT code 47135 to 90.00.

The following is a summary of the comments we received on our proposal.

Comment: The RUC stated that its original reference code is the most appropriate comparator for this service and revising the work RVU for CPT code 47135 to 1.9 percent below the RUC's recommendation would be arbitrary and punitive. Another commenter stated that while they believed the RUC proposed valuation more accurately reflected the work involved, they appreciated the proposal to increase the work RVUs associated with liver transplants, and suggested that CMS accept the RUC-recommended direct PE valuations.

Response: As we stated in the proposed rule, CPT code 32854(Lung transplant, double (bilateral sequential or en bloc); with cardiopulmonary bypass) has very similar intra-service and total times, in addition to an identical work RVU (90.00) to the 25th percentile survey result. We continue to believe the proposed direct crosswalk from CPT code 32854 (Lung transplant, double (bilateral sequential or en bloc); with cardiopulmonary bypass) to CPT code 47135 results in the most accurate valuation. Therefore, for CY 2016 we are finalizing without modification our proposed work RVU of 90.00 for CPT code 47135.

(9) Genitourinary Catheter Procedures (CPT Codes 50430, 50431, 50432, 50433, 50434, 50435, 50693, 50694, and 50695)

For CY 2016, the CPT Editorial Panel deleted six CPT codes (50392, 50393, 50394, 50398, 74475, and 74480) that were commonly reported together, and created 12 new CPT codes, both to describe these genitourinary catheter procedures more accurately and to bundle inherent imaging guidance. Three of these CPT codes (506XF, 507XK, and 507XL) were referred back to CPT to be resurveyed as add-on codes. The other nine codes were reviewed at the January 2015 RUC meeting and assigned recommended work RVUs and direct PE inputs.

We proposed to use the RUC-recommended work RVU of 3.15 for CPT code 50430. We agreed that this is Start Printed Page 70964an appropriate value and that the code should be used as a basis for establishing relativity with the rest of the family. We began by making comparisons between the service times of CPT code 50430 and the other codes in the family in order to determine the appropriate proposed work RVU of each procedure.

In our proposal for CPT code 50431, we stated that we disagreed with the RUC-recommended work RVU of 1.42; we instead proposed a work RVU of 1.10, based on three separate data points. First, the RUC recommendation stated that CPT code 50431 describes work previously described by a combination of CPT codes 50394 and 74425. These two codes have work RVUs of 0.76 and 0.36, respectively, which sum together to 1.12. Second, we noted that the work of CPT code 49460 (Mechanical removal of obstructive material from gastrostomy) is similar, with the same intraservice time of 15 minutes and same total time of 55 minutes but a work RVU of 0.96. Finally, we observed that the minimum survey result had a work RVU of 1.10, and we suggested that this value reflected the total work for the service. Accordingly, we proposed 1.10 as the work RVU for CPT code 50431.

We employed a similar methodology to develop a proposed work RVU of 4.25 for CPT code 50432. The three previously established codes were combined in CPT code 50432; these had respective work RVUs of 3.37 (CPT code 50392), 0.54 (CPT code 74475), and 0.36 (CPT code 74425); together these sum to 4.27 work RVUs. We also examined the valuation of this service relative to other codes in the family. The ratio of the intraservice time of 35 minutes for CPT code 50430 and the intraservice time of 48 minutes for CPT code 50432, applied to the work RVU of base code 50430 (3.15), results in a potential work RVU of 4.32. The total time for CPT code 50432 is higher than CPT code 50430 (107 minutes relative to 91 minutes); applying this ratio to the base work RVU results in a work RVU of 3.70. We utilized these data to inform our proposed crosswalk. In valuing CPT code 50432, we considered CPT code 31660 (Bronchoscopy, rigid or flexible, including fluoroscopic guidance), which has an intraservice time of 50 minutes, total time of 105 minutes, and a work RVU of 4.25. Therefore, we proposed to establish the work RVU for CPT code 50432 at the crosswalked value of 4.25 work RVUs.

In the proposed rule, we stated that according to the RUC recommendations, CPT codes 50432 and 50433 are very similar procedures, with CPT code 50433 making use of a nephroureteral catheter instead of a nephrostomy catheter. The RUC valued the added difficulty of CPT code 50433 at 1.05 work RVUs compared to CPT code 50432. We proposed to maintain the relative difference in work between these two codes by proposing a work RVU of 5.30 for CPT code 50433 (4.25 + 1.05). Additionally, we considered CPT code 57155 (Insertion of uterine tandem and/or vaginal ovoids for clinical brachytherapy), which has a work RVU of 5.40 and an identical intraservice time of 60 minutes, but 14 additional minutes of total time (133 minutes compared to 119 minutes for CPT code 50433), which supported the difference of 0.10 RVUs. For these reasons, we proposed a work RVU of 5.30 for CPT code 50433.

As with the other genitourinary codes, we developed the proposed work RVU of CPT code 50434 in order to preserve relativity within the family. In the proposed rule, we stated that CPT code 50434 has 15 fewer minutes of intraservice time compared to CPT code 50433 (45 minutes compared to 60 minutes). We proposed to apply this ratio of 0.75 to the base work RVU of CPT code 50433 (5.30), which resulted in a potential work RVU of 3.98. We also considered CPT code 50432 as another similar service within this family of services, with three more minutes of intraservice time compared to CPT code 50434 (48 minutes of intraservice time instead of 45 minutes). We noted that applying this ratio (0.94) to the base work RVU of CPT code 50432 (4.25) resulted in a potential work RVU of 3.98. Based on this information, we identified CPT code 31634 (Bronchoscopy, rigid or flexible, with balloon occlusion) as an appropriate direct crosswalk, and proposed a work RVU of 4.00 for CPT code 50434. The two codes share an identical intraservice time of 45 minutes, though the latter possesses a lower total time of 90 minutes.

For CPT code 50435, we considered how the code and work RVU would fit within the family in comparison to our proposed values for CPT codes 50430 and 50432. CPT code 50430 serves as the base code for this group; it has 35 minutes of intraservice time in comparison to 20 minutes for CPT code 50435. This intraservice time ratio of 0.57 (20/35) resulted in a potential work RVU of 1.80 for CPT code 50435 when applied to the work RVU of CPT code 50430 (3.15). Similarly, CPT code 50432 is the most clinically similar procedure to CPT code 50435. CPT code 50432 has 48 minutes of intraservice time compared to 20 minutes of intraservice time for CPT code 50435. This ratio of 0.42 (20/48) applied to the base work RVU of CPT code 50432 (4.25) results in a potential work RVU of 1.77. We also considered two additional procedures to determine a proposed value for CPT code 50435. CPT code 64416 (Injection, anesthetic agent; brachial plexus) also includes 20 minutes of intraservice time and has a work RVU of 1.81. CPT code 36569 (Insertion of peripherally inserted central venous catheter) has the same intraservice and total time as CPT code 50435, with a work RVU of 1.82. Accordingly, we proposed a work RVU of 1.82, a direct crosswalk from CPT code 36569.

The remaining three codes all utilize ureteral stents and form their own small subfamily within the larger group of genitourinary catheter procedures. For CPT code 50693, we proposed a work RVU of 4.21, which corresponds to the 25th percentile survey result. We stated in the proposed rule that we believed that the work RVU corresponding to the 25th percentile survey result provided a more accurate value for CPT code 50693 based on the work involved in the procedure and within the context of other codes in the family. We also indicated that CPT code 31648 (Bronchoscopy, rigid or flexible, with removal of bronchial valve), which shares 45 minutes of intraservice time and has a work RVU of 4.20, was an accurate crosswalk for CPT code 50693.

For CPT code 50694, we compared its intraservice time to the code within the family that had the most similar duration, CPT code 50433. This code has 60 minutes of intraservice time compared to 62 minutes for CPT code 50694. This is a ratio of 1.03; when applied to the base work RVU of CPT code 50433 (5.30), we arrived at a potential work RVU of 5.48. We also looked to procedures with similar times, in particular CPT code 50382 (Removal and replacement of internally dwelling ureteral stent), which has 60 minutes of intraservice time, 125 minutes of total time, and a work RVU of 5.50. We proposed a work RVU of 5.50, a direct crosswalk from CPT code 50382.

Finally, we developed the proposed work RVU for CPT code 50695 using three related methods. In the proposed rule, we stated that CPT codes 50694 and 50695 describe very similar procedures, with 50695 adding the use of a nephrostomy tube. The RUC addressed the additional difficulty of this procedure by recommending 1.55 more work RVUs for CPT code 50695 than for CPT code 50694. Maintaining the 1.55 work RVUs increment, we noted that adding 1.55 to our proposed work RVU for CPT code 50694 (5.50) Start Printed Page 70965would produce a work RVU of 7.05 for CPT code 50695. We also examined the ratio of intraservice times for CPT code 50695 (75 minutes) and the base code in the subfamily, CPT code 50693 (45 minutes). The intraservice time ratio between these two codes is 1.67; when applied to the base work RVU of CPT code 50693 (4.21), we calculated a potential work RVU of 7.02. We also noted that CPT code 36481 (Percutaneous portal vein catheterization by any method) shares the same intraservice time as CPT code 50695 and has a work RVU of 6.98. Accordingly, to maintain relativity among this subfamily of codes, we proposed a work RVU of 7.05 for CPT code 50695 based on an incremental increase of 1.55 RVUs from CPT code 50694.

In reviewing the direct PE inputs for this family of codes, we refined a series of the RUC- recommended direct PE inputs in order to maintain relativity with other codes in the direct PE database. All of the following refinements refer to the non-facility setting for this family of codes. Under the clinical labor inputs, we proposed to remove the RN/LPN/MTA (L037D) (intraservice time for assisting physician in performing procedure) for CPT codes 50431 and 50435. This amounts to 15 minutes for CPT code 50431 and 20 minutes for CPT code 50435. Moderate sedation is not inherent in these procedures and, therefore, we indicated that we did not believe that this clinical labor task would typically be completed in the course of this procedure. We also reduced the RadTech (L041B) intraservice time for acquiring images from 47 minutes to 46 minutes for CPT code 50694. This procedure contains 62 minutes of intraservice time, with clinical labor assigned for acquiring images (75 percent) and a circulator (25 percent). The time for these clinical labor tasks is 46.5 minutes and 15.5 minutes, respectively. The RUC recommendation for CPT code 50694 rounded both of these values upwards, assigning 47 minutes for acquiring images and 16 minutes for the circulator, which together sum to 63 minutes. We reduced the time for clinical labor tasks “acquire images” to 46 minutes to preserve the 62 minutes of total intraservice time for CPT code 50694.

With respect to the post-service portion of the clinical labor service period, we proposed to change the labor type for the task “patient monitoring following service/check tubes, monitors, drains (not related to moderate sedation)”. There are 45 minutes of clinical labor time assigned under this category to CPT codes 50430, 50432, 50433, 50434, 50693, 50694, and 50695. Although we agreed that the 45 minutes are accurate for these procedures as part of moderate sedation, we proposed to change the clinical labor type from the RUC-recommended RN (L051A) to RN/LPN/MTA (L037D) to reflect the staff that would typically be doing the monitoring for these procedures. Even though the CPT Editorial Committee's description of post-service work for CPT code 50435 included a recovery period for sedation, we recognized in our proposal that according to the RUC recommendation, CPT codes 50431 and 50435 did not use moderate sedation; therefore, we did not propose to include moderate sedation inputs for these codes.

The RUC recommendation for CPT code 50433 included a nephroureteral catheter as a new supply input with an included invoice. However, the RUC recommendation did not discuss the use of a nephroureteral catheter in the intraservice work description. CPT code 50433 did mention the use of a nephroureteral stent in this description, but there is no request for a nephroureteral stent supply item on the PE worksheet for this code. We asked for feedback from stakeholders regarding the use of the nephroureteral catheter for CPT code 50433, but did not propose to add the nephroureteral catheter as a supply item for CPT code 50433 pending this information. We also requested stakeholder feedback regarding the intraservice work description in for this code to explain the use, if any, of the nephroureteral catheter in this procedure.

The RUC recommended the inclusion of “room, angiography” (EL011) for this family of codes. In our proposal we stated that we did not agree with the RUC that an angiography room would be used in the typical case for these procedures, as there are other rooms available which can provide fluoroscopic guidance. Most of the codes that make use of an angiography room are cardiovascular codes, and much of the equipment listed for this room would not be used for non-cardiovascular procedures. We therefore proposed to replace equipment item “room, angiography” (EL011) with equipment item “room, radiographic-fluoroscopic” (EL014) for the same number of minutes. We requested public comment regarding the typical room type used to furnish the services described by these CPT codes, as well as the more general question of the typical room type used for GU and GI procedures. In the past, the RUC has developed broad recommendations regarding the typical uses of rooms for particular procedures, including the radiographic-fluoroscopy room. In the proposed rule, we stated that we believed that such a recommendation from the RUC concerning all of these codes could be useful in ensuring relativity across the PFS.

The following is a summary of the comments we received on our proposals.

Comment: Several commenters, including the RUC, stated that the CMS proposed work RVUs were based on a flawed methodology. Commenters stated that CMS ignored intensity measures, differences in patient population, and risk profile considerations between the genitourinary codes. These commenters indicated that they did not agree with the use of intraservice time ratios as a methodology for establishing work RVUs.

Response: We refer the reader to our earlier discussion about the utility of time ratios in identifying potential work RVUs. For this particular group of codes, we believe that establishing CPT code 50430 as the baseline value and then using intraservice time ratios to maintain relativity of work RVUs results in accurate work RVUs for these services. We note that these refined work RVUs were supported in all cases by the use of crosswalks to existing CPT codes which we believe reflect similar intensity, which further supported the refined work RVUs

Comment: Several commenters indicated that the compelling evidence standard applied by the RUC for requiring an increase in valuation had been met for this code family, and therefore increased work RVUs were acceptable when compared to the previous group of genitourinary catheter procedures.

Response: We recognize that the RUC internal deliberations include rules that govern under what circumstances individual specialties can request that the RUC recommend CMS increase values for particular services. As observers to the RUC process, we appreciate having an understanding of these rules in the context of our review of RUC-recommended values. However, we remind the commenters that we are aware of such rules when we initially consider RUC recommendations. We are committed to preserving relativity between services across the entirety of the PFS, and believe that our proposed values best achieve that aim.

Comment: Several commenters disagreed with the use of crosswalks to other CPT codes provided by CMS. Commenters stated that the work Start Printed Page 70966between the codes was not comparable due to clinical differences between the genitourinary catheter codes and the procedures described in the crosswalk codes. Commenters specifically referenced the crosswalk that CMS selected for CPT code 50431 and stated that the CMS chosen crosswalk code does not have the same infectious considerations (bacteremia) or the magnitude of diagnostic considerations as CPT code 50431.

Response: In the resource-based relative value system, services do not have to be clinically similar in order to be comparable. Relative value units (RVUs) are comparable across services furnished by different medical specialties. We note as well that the crosswalk codes referenced by the RUC in its recommendations are frequently not clinically similar to the CPT code under review. In the case of 50431, we note that our crosswalk to CPT code 49460 has identical intraservice time and total time with CPT code 50431, along with similar clinical intensity, suggesting that it has value as a point of comparison for this code. Furthermore, we did not establish a direct crosswalk between the work of these two codes, only using CPT code 49460 (which has a work RVU of 0.96 RVUs) as one of three separate data points. For our second data point, we wrote that the recommendation for CPT code 50431 stated that the new code described work previously performed by a combination of CPT codes 50394 and 74425. These two codes have work RVUs of 0.76 and 0.36, respectively, which sum together to 1.12. For our third data point, we observed that the minimum survey result had a work RVU of 1.10, which we believe accurately reflects the total work for this service. The survey minimum value of 1.10 RVUs was the method used to establish our proposed work RVU for this code. We refer readers to the discussion above in the Methodology for Establishing Work RVUs section for more information regarding the crosswalks used in developing values for this procedure.

After consideration of comments received, we are finalizing our proposed work RVU of 1.10 for CPT code 50431.

Comment: Several commenters disagreed with the CMS proposed work RVU of 4.25 for CPT code 50432 and suggested that CMS accept the RUC-recommended RVU of 4.70. They indicated that CMS used a clinically dissimilar crosswalk, CPT code 31660, which consists of very different work, patient populations, and potential complications. Commenters also stated that CMS used a different combination of existing CPT codes in its building block valuation of the new code 50432, leaving out CPT code 50390. Commenters indicated that this was a mistake and the use of CPT code 50390 would be typical.

Response: As we mentioned previously, in the resource-based relative value system, services do not have to be clinically similar to be comparable. CPT code 31660 shares intraservice time and total time values that are nearly identical to CPT code 50432, along with similar clinical intensity, so we continue to believe that it is an accurate crosswalk. We also do not believe that the use of CPT code 50390 would be typical in constructing a building block methodology for CPT code 50432. The new code is assembled through a combination of genitourinary catheter CPT code 50392 with injection CPT codes 74425 and 74475. We do not believe that CPT code 50390 would typically be included in this group as well, since the code descriptors for both 50390 and 50392 also include drainage and this service would not be performed twice. We believe that the new CPT code 50432 would be used for either the previously reported CPT codes 50390 or 50392 service, but not for both of them at once. In addition, the RUC has recommended that we assume that most of the procedures previously reported using CPT code 50392 would be reported using new CPT code 50432.

We note as well that our proposed work RVU for CPT code 50432 was supported by the use of two time ratios with CPT code 50430. Both the intraservice time ratio and the total time ratio suggested that a value below the RUC recommendation of 4.70 RVUs would be more accurate. After consideration of comments received, we are finalizing our proposed work RVU of 4.25 for CPT code 50432.

Comment: Several commenters stated that CMS should accept the RUC-recommended work RVU of 5.75 for CPT code 50433. While they agreed with CMS' use of the RUC-recommended increment of 1.05 RVUs relative to CPT code 50432, they did not agree with the CMS refined work RVU of CPT code 50432 itself. Some commenters also did not support the CMS crosswalk to CPT code 57155, which they stated had very different work, patient population, and potential complications.

Response: We agree that CPT code 50433 is accurately valued at 1.05 RVUs greater than CPT code 50432, which describes the additional work performed by placing a nephroureteral catheter relative to the work of placing a nephrostomy catheter. However, we continue to believe that our proposed work RVU for CPT code 50432 is an accurate value for the reasons detailed above. With regard to our crosswalk, we maintain that relative value units are comparable across different medical specialties. CPT code 57155 (Insertion of uterine tandem and/or vaginal ovoids for clinical brachytherapy) has an identical intraservice time of 60 minutes and 14 additional minutes of total time, along with similar clinical intensity, which support the difference of 0.10 RVUs when compared to CPT code 50433. After consideration of the comments received, we are finalizing a work RVU of 5.30 for CPT code 50433.

Comment: Several commenters requested that CMS adopt the RUC-recommended work RVU of 4.20 for CPT code 50434. Commenters disagreed with the methodology that CMS used to arrive at the proposed value of 4.00 RVUs, in particular the use of intraservice time ratios, and stated that the CMS crosswalk to CPT code 31634 (Bronchoscopy, rigid or flexible, with balloon occlusion) was inappropriate due to clinical dissimilarity.

Response: We refer the reader to our earlier discussion about intraservice time ratios. We found the identical result of 3.98 work RVUs for CPT code 50434 when we applied the intraservice time ratio to CPT codes 50432 and 50433. This lent further support to our proposed work RVU. With regard to our crosswalk, we note that in the resource-based relative value system, CPT codes do not have to be clinically similar to be comparable. CPT code 31634 shares the identical intraservice time with CPT code 50434 and serves as a direct crosswalk. After consideration of comments received, we are finalizing our proposed work RVU of 4.00 for CPT code 50434.

Comment: Several commenters made similar statements regarding the proposed work RVU for CPT code 50435, criticizing the use of intraservice time ratios with other codes in the genitourinary catheter family and disagreeing with the crosswalked CPT codes for being medically dissimilar.

Response: We refer the reader to our earlier discussion about intraservice time ratios and continue to believe that their use results in accurate work RVUs for this family of codes. We made use of an intraservice time ratio with both CPT code 50430 (the base code for the family) and CPT code 50432 (the most clinically similar code), which produced results of 1.80 and 1.77 RVUs, respectively. We also found two different crosswalks with identical intraservice time and very similar work RVUs, including CPT code 36569, with identical intraservice time, identical Start Printed Page 70967total time, and a work RVU of 1.82 RVUs. Although we maintain that relative value units are comparable across different medical specialties, CPT code 36569 does in fact describe a medically related procedure, with the insertion of a central venous catheter. After consideration of comments received, we are finalizing our proposed work RVU of 1.82 for CPT code 50435.

Comment: Commenters urged CMS to adopt the RUC-recommended work RVU, corresponding to the median survey work RVU of 4.60 RVUs for CPT code 50693. They stated that the placement of a ureteral stent requires more work than the placement of a nephroureteral catheter, and the 0.21 RVU differential proposed by CMS is insufficient to reflect the additional work difficulty of CPT code 50693.

Response: We are uncertain about which codes are being compared by the commenters, since the 0.21 RVU differential referenced by the commenters does not exist in the codes that appear to be discussed in the comment (50433). Since the commenters did not include the five digit CPT designation in their comparison, we are uncertain which code the commenters intended to discuss.

We continue to believe that a work RVU of 4.21, corresponding to the 25th percentile survey result, is the most accurate value for CPT code 50693. We believe that the ureteral stent procedures are clinically similar to the rest of the genitourinary catheter family, and the use of intraservice time ratios with these procedures provides an accurate method for determining relative values. We continue to believe that the work RVU of 4.21, corresponding to the 25th percentile survey result, is further supported through our crosswalk to CPT code 31648 (Bronchoscopy, rigid or flexible, with removal of bronchial valve) which has similar times and a work RVU of 4.20. After consideration of comments received, we are finalizing our proposed work RVU of 4.21 for CPT code 50693.

Comment: Several commenters made statements similar to those mentioned previously regarding the work RVU for CPT code 50694, criticizing the use of intraservice time ratios with other codes in the genitourinary catheter family and disagreeing with the crosswalked CPT codes for being medically dissimilar.

Response: We refer the reader to our earlier discussion about intraservice time ratios and continue to believe that their use results in accurate work RVUs for this family of codes. We compared CPT code 50694 with 50433, the code within the family with the most similar intraservice time, which resulted in a potential work RVU of 5.48. We also found that CPT code 50382 had nearly identical intraservice time and total time, and a work RVU of 5.50. While we maintain that relative value units are comparable across different medical specialties, we do not agree with the commenters that CPT code 50382 is medically dissimilar from CPT code 50694. The former refers to the removal and replacement of a ureteral stent, while the latter refers to the placement of a ureteral stent. We believe that these codes describe very similar procedures, share the same patient population, and can serve as a direct crosswalk for the work RVU of each other. After consideration of comments received, we are finalizing our proposed work RVU of 5.50 for CPT code 50694.

Comment: A few commenters stated that their comments on CPT code 50695 are similar to those they had made previously about CPT code 50433. While they agreed that CMS was correct to maintain the RUC-recommended increment of 1.55 RVUs greater than the value of CPT code 50694, they did not agree with the CMS refined work RVU of 50694 itself. Commenters also did not support the CMS crosswalk to CPT code 36481, which they stated had very different work, patient population, and potential complications.

Response: We agree that CPT code 50695 is accurately valued at 1.55 RVUs greater than CPT code 50694, which describes the additional work performed by the use of a nephrostomy tube. However, we continue to believe that the proposed work RVU for CPT code 50694 is an accurate value for the reasons detailed above. With regard to our crosswalk, we continue to believe that relative value units are comparable across services furnished by different medical specialties. CPT code 36481 (Percutaneous portal vein catheterization by any method) has an identical intraservice time of 75 minutes and 18 additional minutes of total time, but a lower work RVU (6.98 RVUs) than the one suggested by our incremental method. Commenters also did not discuss our use of an intraservice time ratio with the base code in this subfamily, CPT code 50693, which suggested a work RVU of 7.02. After consideration of comments received, we are finalizing our proposed work RVU of 7.05 for CPT code 50695.

Comment: Several commenters disagreed with the CMS proposal to eliminate the RN/LPN/MTA blend (L037D) of clinical labor for assisting the physician during procedures 50431 and 50435. The CMS rationale was based on the lack of moderate sedation taking place in these two procedures. However, commenters argued that these procedures do require monitoring for patient stability that the attending physician cannot provide. They urged that the RN/LPN/MTA blend would be most appropriate for these procedures.

Response: We are not aware of any other procedures in which there is a third assistant in the procedure room when moderate sedation is not being provided. We believe that the standard use of clinical labor staff would be typical when performing these procedures.

Comment: Commenters also disagreed with the CMS proposal to change the labor type for patient monitoring following service (not related to moderate sedation) from the RUC-recommended RN (L051A) to the RN/LPN/MTA blend (L037D). Commenters stated that although use of the RN/LPN/MTA blend is standard for this clinical labor task, the RUC allows specialty groups to use an RN with justification, and that was the case here for these procedures since they involve invasive percutaneous solid organ interventions.

Response: After consideration of comments, we agree that the use of the RN (L051A) clinical labor is typical for patient monitoring following service (not related to moderate sedation) for these particular specialty groups. We will restore the recommended L051A labor type for this clinical labor task for CPT codes 50430, 50432, 50433, 50434, 50693, 50694, and 50695. We will also consider making a formal proposal regarding the most suitable type of clinical labor staff for this monitoring in future rulemaking.

Comment: CMS sought clarification regarding the use of the nephroureteral catheter (SD306) for CPT code 50433. CMS removed this supply from CPT code 50433 since it was not mentioned in the information about the survey included in the RUC recommendation. Commenters wrote to explain that the phrase “An 8 Fr nephroureteral stent is inserted with the distal pigtail in the bladder” is included in the description of work for CPT code 50433, and in the context of genitourinary and biliary procedures, the historic term “stent” has been used interchangeably with the term “catheter”. Commenters suggested that the nephroureteral catheter should be maintained as a supply item for this code and for CPT code 50434.

Response: We agree that the nephroureteral catheter should be maintained as a supply item for CPT codes 50433 and 50434, based on the presentation of this additional information. However, based on our analysis of the comments, we believe Start Printed Page 70968that our review of the RUC recommendations would be facilitated by consistent use of terminology throughout the information included in the recommendations.

Comment: Several commenters, including the RUC, disagreed with the CMS decision to replace the angiography room (EL011) with a fluoroscopic room (EL014) for the genitourinary catheter family of codes. Commenters stressed that the fluoroscopic room was incapable of 3-axis rotational imaging, that it would require dangerous movement of the patient, and that it presented sterility concerns. Commenters further disagreed that use of the angiography room was typically limited to cardiovascular procedures. They suggested that looking at service utilization, rather than number of CPT codes, indicates that non-vascular interventional procedures together comprise more than 50 percent of utilization of a typical angiography room. Commenters also provided a list of the equipment found in an angiography room, and stated that everything other than the “Injector, Provis” would be typically utilized for the genitourinary catheter procedures. As a result, the commenters urged CMS to reverse the proposed refinement and restore the use of the angiography room for these codes.

Response: We continue to believe that the use of an angiography room would not be typical for these genitourinary catheter procedures. The new genitourinary catheter codes in this family are being constructed through the bundling of imaging guidance with previously existing genitourinary catheter procedures. With the exception of CPT code 50398, the direct PE inputs for the predecessor codes do not include the use of an angiography room. We do not have reason to believe the coding changes related to these procedures would necessitate the use of different technology in furnishing the services. While it is true that the angiography room was included as a direct PE input for some of the predecessor imaging services, such as CPT codes 77475, 77480, and 77485, the equipment times for these services were significantly shorter than the time included for the base procedures, where use of the room was not considered to be typical. Given the six fold increase in recommended time and the significantly higher expenses of the newly recommended equipment versus the equipment costs associated with the predecessor codes, we are seeking not only a rationale for the use of the angiography room, but also evidence that this room is typically used when these services are reported in the nonfacility setting.

Comment: One commenter disagreed with the CMS decision to refine the time for clinical labor task “Clean room/equipment by physician staff” (L041B) from 6 minutes to 3 minutes. The commenter stated that there had been a robust discussion of this topic at the RUC meeting, and the additional minutes are needed to clean fluids/equipment/etc.

Response: We continue to believe that the standard time of 3 minutes for this clinical labor task is more accurate for the genitourinary catheter family of codes. We do not believe that these procedures typically produce enough external fluids to justify 6 minutes for room cleaning.

Comment: Several commenters disagreed with the CMS refinement of supplies to remove those that were duplicative of the same supplies found in visit packs (SA048) and sedation packs (SA044). Commenters stated that the IV starter kit (SA019), endoscope cleaning and disinfecting pack (SA042), non-sterile gloves (SB022), sterile gloves (SB024), sterile surgical gown (SB028), and three-way stop cock (SC049) were not duplicative supplies, as they were used in addition to the supplies included in the packs. Commenters requested that these supplies be restored to the direct PE inputs for the genitourinary catheter codes.

Response: We agree with the commenters that three sets of sterile garments would typically be used for the three medical professionals performing the procedure. We are therefore restoring one pair of sterile gloves, one sterile surgical gown, one IV starter kit, and one three-way stop cock to these codes, consistent with the RUC recommendation. We do not believe that the use of two more pairs of non-sterile gloves (beyond the two pairs already included in the visit pack) would be typical for these procedures. With regards to the “endoscope cleaning and disinfecting pack”, our rationale was not that this supply was duplicative, but rather that its use would not be typical because the genitourinary catheter codes do not make use of an endoscope. We did not receive comments that suggested that supply item “endoscope cleaning and disinfecting pack” would typically be used.

After consideration of comments received, we are finalizing the direct PE inputs as proposed, with the addition of the nephroureteral catheter for CPT code 50433, the change in clinical labor type from L037D to L051A for patient monitoring following service (not related to moderate sedation), and the additional four supplies detailed in the previous paragraph for CPT codes 50430, 50432, 50433, 50434, 50693, 50694, and 50695.

(10) Penile Trauma Repair (CPT Codes 54437 and 54438)

The CPT Editorial Panel created these two new codes because there are no existing codes to capture penile traumatic injury that includes penile fracture, also known as traumatic corporal tear, and complete penile amputation. CPT code 54437 describes a repair of traumatic corporeal tear(s), while CPT code 54438 describes a replantation, penis, complete amputation.

In the proposed rule, we stated that we disagreed with the RUC recommendation of 24.50 work RVUs for CPT code 54438. We indicated that a work RVU of 22.10, corresponding to the 25th percentile survey result, was a more accurate value based on the work involved in the procedure and within the context of other codes in the same family, since CPT code 54437 was also valued using the 25th percentile. We found further support for this valuation through a crosswalk to CPT code 43334 (Repair, paraesophageal hiatal hernia via thoracotomy, except neonatal), which has an identical intraservice time and a work RVU of 22.12. Therefore, we proposed a work RVU of 22.10 for CPT code 54438.

Because CPT codes 54437 and 54438 are typically performed on an emergency basis, in the proposed rule, we questioned the accuracy of the standard 60 minutes of preservice clinical labor in the facility setting, as we suggested that the typical procedure would not make use of office-based clinical labor. We suggested, for example, the typical case would require 8 minutes to schedule space in the facility for an emergency procedure, or 20 minutes to obtain consent. We solicited further public comment on this issue from the RUC and other stakeholders.

The following is a summary of the comments we received on our proposals.

Comment: One commenter urged CMS to accept the RUC-recommended value for CPT code 54438 at 24.50 RVUs. This commenter argued that the RUC regularly accepts the median survey work RVU for one service and the 25th percentile survey result work RVU for another when both are in the same code family, particularly when they diverge in length of time. The commenter also suggested that reducing the intensity of CPT code 54438 below its RUC-recommended value of 0.071 Start Printed Page 70969was inappropriate for such a complex and difficult procedure, with an unusual patient population that is often schizophrenic and prone to self-injury. This commenter emphasized using the RUC-supplied reference of CPT code 53448 as justification for the RUC-recommended work RVU.

Response: We appreciate the presentation of this additional information concerning the complexity and intensity of CPT code 54438. We agree that the unusual patient population for this procedure justifies a higher work RVU than the proposed value. After consideration of comments received, we are finalizing our proposed work RVU of 11.50 for CPT code 54437, and assigning the RUC-recommended work RVU of 24.50 for CPT code 54438.

(11) Intrastromal Corneal Ring Implantation (CPT Code 65785)

CPT code 65785 is a new code describing insertion of prosthetic ring segments into the corneal stroma for treatment of keratoconus in patients whose disease has progressed to a degree that they no longer tolerate contact lens wear for visual rehabilitation.

In the proposed rule, we stated that we disagreed with the RUC recommendation of a work RVU of 5.93 for CPT code 65785. Although we appreciated the extensive list of other codes the RUC provided as references, we expressed concern that the recommended value for CPT code 65785 overestimated the work involved in furnishing this service relative to other PFS services. We did not find any codes with comparable intraservice and total time that had a higher work RVU. The recommended crosswalk, CPT code 67917 (Repair of ectropion; extensive), appears to have the highest work RVU of any 90-day global surgery service in this range of work time values. It also has longer intraservice time and total time than the code in question, making a direct crosswalk unlikely to be accurate.

As a result, we proposed a work RVU for CPT code 65785 based on the intraservice time ratio in relation to the recommended crosswalk. We compared the 33 minutes of intraservice time in CPT code 67917 to the 30 minutes of intraservice time in CPT code 65785. The intraservice time ratio between these two codes is 0.91, and when multiplied by the work RVU of CPT code 67917 (5.93) resulted in a potential work RVU of 5.39. We also considered CPT code 58605 (Ligation or transection of fallopian tube(s)), which has the same intraservice time, 7 additional minutes of total time, and a work RVU of 5.28. In the proposed rule, we stated that we believed that CPT code 58605 was a more accurate direct crosswalk because it shares the same intraservice time of 30 minutes with CPT code 65785. Accordingly, we proposed a work RVU of 5.39 for CPT code 65785.

The RUC recommendation for CPT code 65785 included a series of invoices for several new supplies and equipment items. One of these was the 10-0 nylon suture with two submitted invoice prices of $245.62 per box of 12, or $20.47 per suture, and another was priced at $350.62 per box of 12, or $29.22 per suture. Given the range of prices between these two invoices, we sought publicly available information and identified numerous sutures that appear to be consistent with those recommended by the specialty society, at lower prices, which we believed were more likely to be typical since we assumed that the typical practitioner would seek the best price. One example is “Surgical Suture, Black Monofilament, Nylon, Size: 10-0, 12”/30cm, Needle: DSL6, 12/bx” for $146. Therefore, we proposed to establish a new supply code for “suture, nylon 10-0” and price that item at $12.17 each. We welcomed comments from stakeholders regarding this supply item.

The following is a summary of the comments we received on our proposals.

Comment: Several commenters indicated that CMS should reconsider its decision and accept the RUC-recommended work RVU of 5.93. These commenters stated that the intraservice time ratio used by CMS did not account for differences in preservice time, postservice time, or levels of physician intensity. Commenters also disagreed with CMS' statement that there were no services with a comparable intraservice and total time that had a higher work RVU than the RUC-recommended value of 5.93 for CPT code 65785. The commenters supplied a list of seven CPT codes that have a work RVU higher than 5.93 RVUs.

Response: We continue to believe that the use of intraservice time ratios is one of several different methods that can be used to identify potential work RVUs. For this particular code, the RUC used a direct crosswalk to CPT code 67917 (Repair of ectropion; extensive) to set their recommended work RVU at 5.93 RVUs. We do not believe that that direct crosswalk was the most accurate way to value CPT code 65785, since code 67917 has an intraservice time that is 10 percent longer than the intraservice time of CPT code 65785 (33 minutes to 30 minutes). CPT code 67917 is a clinically similar code which the RUC used for its own valuation of CPT code 65785, making it an especially good choice for comparative purposes after applying a ratio to normalize the intraservice times. We continue to believe that the use of an intraservice time ratio resulted in the most accurate value, given the difference in time between the two codes.

As discussed in the proposed rule, all CPT codes with comparable time values and the same global period had lower work RVUs than the RUC-recommended work RVU of 5.93. While it is true that the seven codes provided by the commenters have work RVUs higher than 5.93 RVUs, we do not agree that these CPT codes are appropriate for comparative purposes with code 65785. CPT code 33768 is an add-on code (global ZZZ) that cannot be compared to a code with a 90-day global period such as 65785. CPT code 59830 is a Harvard-valued code that has not been subject to RUC review, has low utilization (2013 = 7 reported services), and 20 minutes fewer total time than CPT code 65785. CPT codes 66770 and 67145 are also Harvard codes which have not been RUC reviewed, and both have different intraservice times than 65785, 5 minutes and 10 minutes, respectively. CPT codes 67210 and 67220 are the only codes supplied by the commenters to be recently reviewed by the RUC, but both of them have only 15 minutes intraservice time, limiting their utility for comparative purposes with the 30 minutes intraservice time assumed for CPT code 65785. Although we accept the commenters' point that other codes with work RVUs above 5.93 RVUs do exist, we do not agree that codes referenced by commenters have “comparable intraservice and total time” with CPT code 65785. We continue to believe that scaling the RUC's key reference code of 67917 by the intraservice time ratio between the two codes provides the most accurate value for CPT code 65785.

After consideration of comments received, we are finalizing the work RVU and the direct PE inputs for CPT code 65785 as proposed.

(12) Dilation and Probing of Lacrimal and Nasolacrimal Duct (CPT Codes 66801, 68810, 68811, 68815 and 68816)

The RUC reviewed 10-day global services and identified 18 services with greater than 1.5 office visits and 2012 Medicare utilization data over 1,000, including CPT codes 66801, 68810, 68811, 68815, and 68816. The RUC requested surveys and reviews of these services for CY 2016.

As discussed in the proposed rule, the RUC recommended a work RVU of 1.00 Start Printed Page 70970for CPT code 68801 and a work RVU of 1.54 for CPT code 68810. Although we proposed to use the RUC-recommended work RVU for CPT code 68810, we stated that the recommendation for CPT code 68801 did not best reflect the work involved in the procedure because of a discrepancy between the post-operative work time and work RVU. Specifically, the RUC recommendation for the procedure included the removal of a 99211 visit, but the RUC-recommended work RVU did not reflect any corresponding adjustment. We proposed to accept the RUC's recommendation to remove the 99211 visit from the service but proposed to further reduce the work RVU for CPT code 68801 by removing the RVUs associated with CPT code 99211. Therefore, for CY 2016, we proposed a work RVUs of 0.82 to CPT code 68801 and 1.54 to CPT code 68810.

The RUC recommended a work RVU of 2.03, 3.00, and 2.35 for CPT codes 68811, 68815 and 68816, respectively. In the proposed rule, we stated that the RUC recommendations for these services do not appear to best reflect the work involved in performing these procedures. To value these services for the proposed rule, we calculated a total time ratio by dividing the code's current total time by the RUC-recommended total time, and then applying that ratio to the current work RVU. This produced the proposed work RVUs of 1.74, 2.70, and 2.10 for CPT codes 68811, 68815, and 68816, respectively.

The following is a summary of the comments we received on our proposals.

Comment: Several commenters, including the RUC, suggested that CMS reconsider its decision to not accept the RUC recommendations. The commenters believe that using a reverse building block methodology to reduce a work RVU for this service is inappropriate since magnitude estimation was used to establish the recommended work RVUs for this series of codes. Commenters also believe that CMS did not provide detailed rationale for the rejection of the RUC-recommended work RVUs for CPT codes 68811, 68815 and 68816. Finally, commenters noted that the existing IWPUT for each of these three surgical services is below 0.03, which the commenters believe calls into question the accuracy of the existing work time and its usage in deriving a new work RVU.

Response: We appreciate the commenters' perspectives, but reiterate that our proposed values accounted for the changes in the time resources assumed to be involved in furnishing these services since they were previously valued. We note that the validity of the IWPUT alone as a measure of intensity is reliant on the accuracy of the assumption regarding the number and level of visits for services in the global period for individual services. Therefore, we do not generally agree that a low IWPUT itself indicates misvaluation, particularly for services with global periods. After considering the comments received, we continue to believe that the work RVUs proposed for these codes accurately reflect the work involved in furnishing these services.

Therefore, for CY 2016 we are finalizing work RVUs for CPT codes 68801, 68810, 68811, 68815, and 68816, as proposed.

(13) Spinal Instability (CPT Codes 72081, 72082, 72083, and 72084)

For CY 2015, the CPT Editorial Panel deleted codes 72010 (radiologic examination, spine, entire, survey study, anteroposterior and lateral), 72069 (radiologic examination, spine, thoracolumbar, standing (scoliosis)), and 72090 (radiological examination, spine; scoliosis study, including supine and erect studies), revised one code, 72080 (Radiologic examination, spine; thoracolumbar junction, minimum of 2 views) and created four new codes which cover radiologic examination of the entire thoracic and lumbar spine, including the skull, cervical and sacral spine if performed. The new codes were organized by number of views, ranging from one view in 72081, two to three views in 72082, four to five views in 72083, and minimum of six views in 72084.

In the proposed rule, we stated that we did not agree with the RUC's recommended work RVUs for the four new codes. For 72081, we noted that the one minute increase in time resulted in a larger work RVU than would be expected when taking the ratio between time and RVUs in the source code and comparing that to the time and work RVU ratio in the new code. Using the relationship between time and RVUs from deleted CPT code 72069, we proposed a work RVU of 0.26 for CPT code 72081, which differs from the RUC-recommended value of 0.30. Using an incremental methodology based on the relationship between work and time in the first code we proposed to adjust the RUC-recommended work RVUs for CPT codes 72082, 72083 and 72084 to 0.31, 0.35, and 0.41, respectively.

The following is a summary of the comments we received on our proposals.

Comment: Many commenters, including the RUC, disagreed with CMS' proposed crosswalk for 72081 and urged CMS to use the RUC recommendation. The commenters stated that since CPT code 72069 is being deleted due to changes in technology and patient population, it is a poor comparison. Other commenters pointed out that CPT code 72081 typically includes an X-ray of skull, cervical spine, and pelvis and therefore is by definition more work than CPT code 72069. CPT code 72069 is also noted as “CMS/other” code in the RUC's time file and the times in that file are not divided into time periods as CPT code 72081 is. One commenter suggested that a more accurate crosswalk was CPT code 74020 (Radiologic examination, abdomen; complete, including decubitus and/or erect views,) which has a work RVU of 0.30. Using the same increments, the commenter suggested that the CMS proposed change for CPT code 72081 to 0.26 RVUs would result in an accurate increase in work across the family.

Response: We continue to believe that CPT code 72069 is an accurate crosswalk. While CPT code 72069 may not be divided into time periods, the ratio between the total time and the RVU adequately reflects the relationship between time and intensity in CPT code 72081. Although we used CPT code 72069 as a comparison to CPT code 72081, we note that CPT code 72081 has a higher work RVU, which accounts for the extra work associated with imaging the skull, cervical spine, and pelvis. We do not believe that CPT code 74020 would be an accurate crosswalk because it describes a radiological examination of the abdomen whereas CPT code 72069 refers to the same anatomical region as CPT code 72081.

Therefore, after considering the comments received, we are finalizing these work RVUs for 72081, 72082, 72083, and 72084 as proposed.

(14) Echo Guidance for Ova Aspiration (CPT Code 76948)

In the CY 2014 PFS final rule with comment period, we requested additional information to assist us in the valuation of ultrasound guidance codes. We nominated these codes as potentially misvalued based on the extent to which standalone ultrasound guidance codes were billed separately from services where ultrasound guidance was an integral part of the procedure. CPT code 76948 was among the codes considered potentially misvalued. CPT code 76948 was surveyed by the specialty societies and the RUC issued a recommendation for CY 2016. In the proposed rule, we stated that we had concerns about valuation of this code since it is a guidance code Start Printed Page 70971used only for a single procedure, CPT code 58970 (aspiration of ova), and that these two codes are typically billed concurrently. We believe CPT codes 76948 and 58970 should be bundled to accurately reflect how the service is furnished.

We proposed to use work times based on refinements of the RUC-recommended values by removing the 3 minutes of pre and post service time since these times are reflected in CPT code 58970. We proposed work and time values for 76948 based on a crosswalk from 76945 (Ultrasonic guidance for chorionic villus sampling, imaging supervision and interpretation) which has a work time of 30 minutes and an RVU of 0.56. Therefore we proposed to maintain 25 minutes of intraservice time for CPT code 76948 and proposed a work RVU of 0.56.

The following is a summary of the comments we received on our proposals.

Comment: Commenters stated that CMS should not have removed the work from the pre and post service portions of the service period and should restore the RUC-recommended work RVU of 0.85. The commenters stated that in the pre service period the physician reviews clinical history as well as prior imaging studies, and in the post service period the physician reviews and signs final report. The RUC commented that CPT codes 58970 and 76945 were billed less than 10 times each in 2014, and were not billed together in any of those instances. The RUC acknowledged that these codes may be billed together under private payers and stated they would continue to review codes billed together 75 percent of the time and bundle them when appropriate.

Response: We appreciate the commenters' feedback. However, given the definition of the codes, we continue to believe that CPT code 76945 is the image guidance code for CPT code 58970, and that these codes would not typically be billed separately. We acknowledge the anomalies in the low volume of Medicare claims data but do not believe that data likely reflects the way the services are intended to be reported. Therefore, any pre- or post-service work would be accounted for in CPT code 58970. After considering the comments received, we are finalizing a work RVU of 0.56 for CPT code 76945 as proposed.

(15) Surface Radionuclide High Dose Radiation Brachytherapy (CPT Codes 77767, 77768, 77770, 77771, and 77772)

In October 2014 the CPT Editorial Panel created five new codes to describe high dose radiation (HDR) brachytherapy. We proposed the RUC-recommended work RVUs of 1.05, 1.40, 1.95, 3.80, and 5.40 respectively, for CPT codes 77767, 77768, 77770, 77771, and 77772. The RUC also recommended a new PE input, a brachytherapy treatment vault, which we proposed to include without modification.

Comment: Commenters expressed support for CMS' proposed work and time values for this family of codes, and for CMS' proposal to add the brachytherapy vault as a PE input. Many commenters expressed concern for the overall downward trend in reimbursement for brachytherapy services, citing a sustained decrease in office-based brachytherapy procedures since 2009. The commenters encouraged CMS to enact measures to improve this.

Response: We appreciate commenters' concerns regarding accurate payment for brachytherapy services. The revaluation of services under the Potentially Misvalued Code Initiative is aimed at achieving the most appropriate relative values under the PFS. There is not an intentional “downward trend” for any particular family of services. We remind commenters and stakeholders that disagree with CMS values, including those based on RUC recommendations, that in addition to submitting comments on our proposed rules, they may also nominate codes as potentially misvalued through the public nomination process. We are finalizing the values for HDR brachytherapy as proposed.

(16) Immunohistochemistry (CPT Codes 88341, 88342, and 88344)

As discussed in the proposed rule, in establishing CY 2015 interim final direct PE inputs for CPT codes 88341, 88342, and 88344, we replaced the RUC-recommended supply item “UltraView Universal DAB Detection Kit” (SL488) with “Universal Detection Kit” (SA117), since the RUC recommendation did not provide an explanation for the required use of a more expensive kit. We also adjusted the equipment time for equipment item “microscope, compound” (EP024). We reexamined these codes when valuing the immunofluorescence family of codes for CY 2016, and reviewed information received by commenters that explained the need for these supply items. Specifically, commenters explained that the universal detection kit that CMS included in place of the RUC-recommended kit was not typically used in these services as it was not clinically appropriate. We proposed to include the RUC-recommended supply item SL488 for CPT codes 88341, 88342, and 88344, as well as the RUC-recommended equipment time for “microscope, compound” for CY 2016.

In establishing interim final work RVUs for this family of codes, we refined the RUC recommendation for CPT code 88341 to 0.42, such that the work RVU for this add-on code was 60 percent of that of the base code 88342 (0.70 work RVUs). We noted that for similar procedures in this family, the RUC had recommended work RVUs for add-on codes that were 60 percent of the base codes, and that we believed this methodology would appropriately value this add-on code. In the proposed rule, we reexamined the work RVU for this service in the context of reviewing the immunoflurescent studies procedures. In doing so, we increased the work RVU of this add-on code to 0.53, which reflected 76 percent of 0.70, the base code for this service. We discuss our rationale for this adjustment in the immunofluorescent studies section below. However, we inadvertently omitted the rationale for this revision to the work RVU in the proposed rule.

The following is a summary of the comments we received on our proposals.

Comment: Several commenters, including the RUC, stated their appreciation of CMS' reconsideration when reexamining the RUC-recommended direct PE inputs, “UltraView Universal DAB Detection Kit” (SL488) and equipment time for the supply item “microscope, compound” (EP024) for CPT codes 88341, 88342, and 88344 following feedback from the public.

A few commenters also noted that the work RVU for CPT code 88341 (Immunohistochemistry or immunocytochemistry, per specimen; each additional single antibody stain procedure (List separately in addition to code for primary procedure) as displayed in Addendum B of the proposed rule was inconsistent with the CY 2015 work RVU but was not discussed elsewhere in the proposed rule.

Response: The discussion about the rationale for the increased work RVU for CPT code 88341 was inadvertently omitted from the proposed rule. Since the proposed rule did not include this discussion, we will maintain the interim final status of the CY 2015 work RVU of 0.53 for CY 2016 and we are seeking comment on this work RVU during the comment period for this final rule with comment period.

(17) Immunofluorescent Studies (CPT Codes 88346 and 88350)

For CY 2016, the CPT Editorial Panel deleted one code, CPT code 88347 Start Printed Page 70972(Antibody evaluation), created a new add-on service, CPT code 88350, and revised CPT code 88346 to describe immunofluorescent studies. The RUC recommended a work RVU of 0.74 for CPT code 88346 and 0.70 for CPT code 88350. In the proposed rule, we stated that although we proposed to use the RUC recommendation for CPT code 88346, we did not believe the recommendation for CPT code 88350 best reflects the work involved in the procedure due to our concerns with the relationship between the RUC-recommended intraservice times for the base code and the newly created add-on code. We examined intraservice time relationships between other base codes and add-on codes and found that two codes in the Intravascular ultrasound family, CPT code 37250 (Ultrasound evaluation of blood vessel during diagnosis or treatment) and CPT code 37251 (Ultrasound evaluation of blood vessel during diagnosis or treatment), share a similar base code/add-on code intraservice time relationship, and are also diagnostic in nature, as are CPT codes 88346 and 88350. Due to these similarities, we believed it was appropriate to apply the relationship, which is a 24 percent difference, between CPT codes 37250 and 37251 in calculating work RVUs for CPT codes 88346 and 88350. In the proposed rule, we explained that we multiplied the RVU of CPT code 88346, 0.74, by 24 percent, and then subtracted the product from 0.74, resulting in a work RVU of 0.56 for CPT code 88350. Therefore, for CY 2016, we proposed a work RVU of 0.74 for CPT code 88346 and 0.56 for CPT code 88350.

The following is a summary of the comments we received on our proposals.

Comment: Several commenters stated their disagreement with the comparison of immunofluorescent studies (CPT codes 88346 and 88350) to ultrasound evaluation of blood vessels (CPT Codes 37250 and 37251). Commenters specifically stated the ultrasound services are add-on services involving initial and additional vessels, whereas CPT codes 88346 and 88350 involve work related to initial and additional single antibody stain procedures. Commenters maintain that the level of work required to evaluate the initial stain is nearly identical to the second and that no efficiency is gained from the initial to the next and, therefore, a reduction in work RVUs for the additional slide would be inappropriate.

Response: We continue to believe that the RVUs should reflect a reduction of overall work in each additional antibody stain slide. We also note that for CY 2015, we established as interim final a 40 percent reduction for add-on codes, which we subsequently refined to a 24 percent reduction in the CY 2016 proposed rule. We have not received any alternative recommendations as to the appropriate value for CPT code 88350. Therefore, we are finalizing our proposed valuation for CPT codes 88346 and 88350.

(18) Morphometric Analysis (CPT Codes 88364, 88365, 88366, 88367, 88373, 88374, 88377, 88368, and 88369)

The RUC reviewed and developed recommendations regarding CPT codes 88367 and 88368. We reviewed and proposed values based on those recommended values as discussed in the proposed rule. Subsequently, the RUC re-reviewed these services for CY 2016 due to the specialty society's initially low survey response rate. In our review of these codes, we noticed that the latest RUC recommendation was identical to the RUC recommendation provided for CY 2015. Therefore, we proposed to retain the CY 2015 work RVUs and work time for CPT codes 88367 and 88368 for CY 2016.

For CPT codes 88364 and 88369, we refined the RUC recommendations to 0.67 for both procedures, such that the work RVUs for these add-on codes was 60 percent of the base codes. We noted that for similar procedures in this family, the RUC had previously recommended work RVUs for add-on codes that were 60 percent of the base codes, and that we believed this methodology would appropriately value these add-on codes. In the proposed rule, we reexamined the work RVUs for these services in the context of reviewing the immunofluorescent studies procedures. In doing so, we increased the work RVUs of these add-on codes to 0.67, which reflected 76 percent of 0.88, the work RVUs of the base codes for these services. We discuss our rationale for this adjustment in the immunofluorescent studies section above. However, we inadvertently omitted the rationale for this revision to the work RVU in the proposed rule.

As discussed in the proposed rule, in establishing interim final direct PE inputs for CY 2015 for CPT codes 88364, 88365, 88366, 88367, 88373, 88374, 88377, 88368, and 88369, we refined the RUC-recommended direct PE inputs as follows. We refined the units of several supply items, including “ethanol, 100%” (SL189), “ethanol, 70%” (SL190), “ethanol, 85%” (SL191), “ethanol, 95%” (SL248), “kit, FISH paraffin pretreatment” (SL195), “kit, HER-2/neu DNA Probe” (SL196), positive and negative control slides (SL112, SL118, SL119, SL184, SL185, SL508, SL509, SL510, SL511), “(EBER) DNA Probe Cocktail” (SL497),”Kappa probe cocktails” (SL498) and “Lambda probe cocktails” (SL499), to maintain consistency within the codes in the family, and adjusted the quantities included in these codes to align with the code descriptors and better reflect the typical resources used in furnishing these services. We also adjusted the equipment time for equipment items “water bath, FISH procedures (lab)” (EP054), “chamber, Hybridization” (EP045), “microscope, compound” (EP024), “instrument, microdissection (Veritas)” (EP087), and “ThermoBrite” (EP088), to reflect the typical time the equipment is used, among other common refinements.

For CY 2016, we reexamined these codes when valuing the immunofluorescence family of codes, and reviewed information received from commenters during the CY 2015 final rule's comment period that described the typical batch size for each of these services, which identified apparent inconsistencies and discrepancies in the quantity of units among the codes in the family. For CY 2016, we proposed to include the RUC-recommended quantities for each of these supply items for the CPT codes 88364, 88365, 88366, 88367, 88373, 88374, 88377, 88368, and 88369. With regard to the equipment items, we received information explaining that the recommended equipment times already accounted for the typical batch size, and thus, the recommended times were already reflective of the typical case. Therefore, we proposed to adjust the equipment time for equipment items EP054, EP045, and EP087 to align with the RUC-recommended times. We also received comments explaining the need for equipment item EP088. Therefore, we proposed to include this equipment item consistent with the RUC recommendations for CPT code 88366.

In the proposed rule, we noted that the information we received regarding the typical batch size was critical in determining the appropriate direct PE inputs for these pathology services. We also noted that we usually do not have information regarding the typical batch size or block size when we are reviewing the direct PE inputs for pathology services. The supply quantity and equipment minutes are often a direct function of the number of tests processed at once. Given the importance of the typical number of tests being processed by a laboratory in determining the direct PE inputs, which often include expensive supplies, we Start Printed Page 70973expressed concern that the direct PE inputs included in many pathology services may not reflect the typical resource costs involved in furnishing the typical service.

In particular, we noted in the proposed rule that since laboratories of various sizes furnish pathology tests and that, depending on the test, a large laboratory may be at least as likely to have furnished a test to a Medicare beneficiary compared to a small laboratory, we noted that an equipment item involved in furnishing a service that is commercially available to a small laboratory may not be the same equipment item that is used in the typical case. If the majority of services billed under the PFS for a particular CPT code are furnished by laboratories that run many of these tests each day, then assumptions informed by commercially available products may significantly underestimate the typical number of tests processed together, and thus the assumptions underlying current valuations for per-test cost of supplies and equipment may be much higher than the typical resources used in furnishing the service. We invited stakeholders to provide us with information about the equipment and supply inputs used in the typical case for particular pathology services.

The following is a summary of the comments we received on our proposals.

Comment: Several commenters, including the RUC, stated their disagreement with the methodology utilized in valuing CPT code 88367 and urged CMS to use survey data and magnitude estimation when proposing a work RVU. Commenters also suggested that there should be no comparison of intravascular ultrasound services to morphometric analysis, immunohistochemistry, immunofluorescence or any pathology service. One commenter noted that for CPT code 88374 (Morphometric analysis, in situ hybridization (quantitative or semi-quantitative), using computer-assisted technology, per specimen; each multiplex probe stain procedure), using computer-assisted technology does not replace the pathologist's work; it merely refers to computer-aided selection of images for the pathologist to review and that the computer does not establish the distinction between cancer and non-cancer cells.

Response: As discussed in the CY 2015 final rule with comment period (79 FR 67669), we do not believe the RUC-recommended work RVU of 0.86 for 88367 (intraservice time = 25 minute) adequately reflects the difference in time relative to 88368 (RVU = .88, intraservice time = 30 minutes). Commenters did not address our concerns about this change in time not being reflected in the work RVU for 88367. Therefore, we continue to believe 0.73 RVUs accurately reflects the work for CPT code 88367. With regard to CPT code 88374, while we acknowledge using computer-assisted technology does not replace the pathologist's work, we continue to believe there are some efficiencies gained with the computer assistance. After considering the comments received, for CY 2016, we are finalizing the values for CPT codes 88367 and 88374 as proposed.

Comment: A commenter noted that the work RVUs for CPT codes 88364 and 88369 as displayed in Addendum B of the proposed rule were inconsistent with the CY 2015 work RVUs, but were not discussed elsewhere in the proposed rule.

Response: As noted above, the discussion about the rationale for the increased work RVU was inadvertently omitted from the proposed rule. Since the proposed rule did not include this discussion, we will maintain the interim final status of the work RVU of 0.76 for CPT codes 88464 and 88369 for CY 2016 and we are seeking comment on these work RVUs during the comment period for this final rule with comment period.

(19) Vestibular Caloric Irrigation (CPT Codes 92537 and 92538)

For CY 2016, the CPT Editorial Panel deleted CPT code 92543 (Assessment and recording of balance system during irrigation of both ears) and created two new CPT codes, 92537 and 92538, to report caloric vestibular testing for bithermal and monothermal testing procedures, respectively. The RUC recommended a work RVU of 0.80 for CPT code 92537 and a work RVU of 0.55 for CPT code 92538. In the proposed rule, we stated that we believed that the recommendations for these services overstate the work involved in performing these procedures. Due to similarity in service and time, we proposed that a direct crosswalk of CPT code 97606 (Negative pressure wound therapy, surface area greater than 50 square centimeters, per session) to CPT code 92537 accurately reflects the total work involved in furnishing the service. To establish a proposed value for CPT code 92538, we divided the proposed work RVU for 92537 in half since the code descriptor for this procedure describes the service as having two irrigations as opposed to the four involved in CPT code 92537. Therefore, for CY 2016, we proposed work RVUs of 0.60 to CPT code 92537 and 0.30 to CPT code 92538.

The following is a summary of the comments we received on our proposals.

Comment: Several specialty societies stated their disappointment that CMS did not accept the RUC-recommended work RVUs for CPT codes 92537 and 92538. Commenters stated their objection to the rationale CMS used, stating that the rationale ignored the cogent, methodical, and thorough approach utilized by the RUC.

Response: We appreciate the commenters' feedback. However, we reiterate that CPT code 67606 has nearly identical intra-service and total times as CPT code 92537 and given the similarity in services we continue to believe the direct crosswalk from CPT code 97606 to CPT code 92537 to be the most accurate. Also, CPT code 92538 describes two irrigations which is half the work involved in furnishing the service of CPT code 92537. For that reason, we continue to believe it is appropriate to establish 92538 with half of the work RVUs of 92537. Therefore, for CY 2016 we are finalizing a work RVU of 0.60 for 92537 and 0.30 for 92538.

(20) Instrument-Based Ocular Screening (CPT Codes 99174 and 99177)

For CY 2015, the CPT Editorial Panel created a new code, CPT code 99177, to describe instrument-based ocular screening with on-site analysis and also revised existing CPT code 99174, which describes instrument-based ocular screening with remote analysis and report. In the proposed rule, we stated that CPT code 99174 was currently assigned a status indicator of N (non-covered service) which we proposed should remain unchanged since this is a screening service. After review of CPT code 99177, we proposed that this service was also a screening service and should be assigned a status indicator of N (non-covered service). Therefore, for CY 2016, we proposed to assign a PFS status indicator of N (non-covered service) for CPT codes 99174 and 99177.

The following is a summary of the comments we received on our proposals.

Comment: A few commenters, including the RUC, stated their disagreement with CMS' proposal to assign a status indicator of “N” (non-covered service). Commenters stated there is a long-standing precedent that status indicator “N,” codes have had their RUC-recommended values published in the PFS.

Response: We continue to believe CPT codes 99174 and 99177 are screening Start Printed Page 70974services and are therefore non-covered services under the Medicare program. Therefore, for CY 2016, we are finalizing our proposed assignment of a PFS status indicator of N (non-covered service) for CPT codes 99174 and 99177. Because we have not reviewed the recommended values for these services, we do not believe that we should develop or display RVUs for these services. In some cases in the past, we have developed and displayed RVUs for codes not separately payable by Medicare. However, we note that this practice has not been consistently applied and we have concerns about this practice since it is not apparent in the display itself that the resulting RVUs do not reflect our review or assessment of the recommendations nor do they reflect the influence of updated Medicare claims data. However, we understand that, for PFS nonpayable services, displaying RVUs that are based solely on recommendations may serve an interest for the public. Therefore, we will consider for the future how we might reconcile that interest with our interest in maintaining a clear distinction between the RVUs that result from our established methodology and RVUs that result solely from recommended input values.

(21) Lung Cancer Screening Counseling and Shared Decision Making Visit and Lung Cancer Screening With Low Dose Computed Tomography (CPT Codes G0296 and G0297)

We issued national coverage determination (NCD) for Medicare coverage of a lung cancer screening counseling and shared decision making visit, and for appropriate beneficiaries, annual screening with low dose computed tomography (LDCT), as an additional preventive benefit, effective February 5, 2015. The American College of Radiology (ACR) submitted recommendations for work and direct PE inputs.

We proposed to value CPT code G0296 (Counseling visit to discuss need for lung cancer screening (LDCT) using low dose CT scan (service is for eligibility determination and shared decision making)) using a crosswalk from the work RVU for G0443 (Brief face-to-face counseling for alcohol misuse, 15 minutes) which has a work RVU of 0.45. We added 2 minutes of pre-service time, and one minute post-service time which we valued at 0.0224 RVU per minute yielding a total of 0.062 additional RVUs which we then added to 0.45, bringing the total proposed work RVUs for G0296 to 0.52. The direct PE input recommendations from the ACR were refined according to CMS standard refinements and appear in the CY 2016 proposed direct PE input database.

For CPT code G0297 (Low dose CT scan (LDCT) for lung cancer screening), the ACR recommended that CMS crosswalk CPT code G0297 to CPT code 71250 (computed tomography, thorax; without contrast material) with additional work added to account for the added intensity of the service. After reviewing this recommendation, we stated in our proposal that the work (time and intensity) was identical for both CPT code G0297 and CPT code 71250. Therefore, we proposed a work RVU of 1.02 for CPT code G0297. The following is a summary of the comments we received on our proposals.

Comment: Several commenters stated that the CMS-proposed crosswalk for G0296 (Counseling visit to discuss need for lung cancer screening (LDCT) using low dose CT scan (service is for eligibility determination and shared decision making)) did not accurately reflect the time and intensity of furnishing this service. Some commenters suggested that 15 minutes is not enough time for the practitioner to engage in a meaningful conversation with the patient and that the work and time for the shared decision making visit should reflect this.

Response: Because we continue to believe that the cognitive work for G0296 is comparable to G0443 and that there is no additional work associated with fulfilling the requirements of the NCD, we believe that the work and time for the counseling and shared decision making visit is included in the values associated with the crosswalk code.

Comment: For CPT code G0297 (Low dose CT scan (LDCT) for lung cancer screening), a few commenters expressed support for our proposed work RVUs of 1.02. Several commenters were concerned that the proposed crosswalks and work valuations did not adequately reflect the time and intensity involved in furnishing these services. The American College of Radiology suggested that a lung cancer screening low dose CT required greater technical skill and mental effort to make the correct diagnosis, and that the baseline increase of malignancy caused greater psychological stress for the provider and the additional requirements of the NCD add to the intensity of performing these services.

Response: Reading radiologists that meet the eligibility requirements of the NCD have extensive experience interpreting chest CTs. For example, the NCD states that among other things, an eligible reading radiologist must have been involved in the supervision and interpretation of at least 300 chest CT acquisitions in the past 3 years. Therefore, we do not believe that extra work is involved in furnishing the low-dose CT, as compared to CPT code 71250.

Comment: Several commenters requested CMS clarify that a medically necessary E/M visit can be billed on the same day as the lung cancer screening counseling and shared decision making visit. Some commenters also requested that the shared decision making visit be considered part of, or complementary to, the annual wellness visit. Several commenters also asked CMS to clarify that the lung cancer LDCT screening and the counseling and shared decision making visit are not subject to cost sharing since they are preventive services.

Response: As long as the NCD requirements for the counseling and shared decision making visit are met, the counseling visit may be billed on the same day as a medically necessary E/M visit or an annual wellness visit with the -25 modifier. Practitioners should refer to the NCD for information regarding the Medicare coverage requirements for the counseling and shared decision making visit. Lung cancer screening with LDCT, including a lung cancer screening counseling and shared decision making visit, is covered as an additional preventive benefit, identified for Medicare coverage through the NCD process. Therefore, this benefit meets the criteria in sections 1833(a)(1) and (b)(1) of the Act for nonapplication of the deductibles and coinsurance.

Comment: Many commenters were concerned with the fact that, although the NCD was issued in February of 2015, there are no instructions for billing services performed prior to 2016.

Response: CMS is in the process of developing claims processing, coding and billing instructions. This information is forthcoming.

Comment: One commenter asked if the imaging facility would be subject to recoupment for a CT if a hospital performed a CT believing that the required counseling had occurred, and later it was determined that it had not.

Response: We appreciate this comment. While we acknowledge the commenter's concern, we believe that this comment is outside the scope of this rulemaking.

Comment: One commenter requested that the shared decision making visit be added to the list of telehealth services.

Response: We refer readers to section II.I. of this final rule with comment period, where we discuss the process for adding services to the list of Medicare Start Printed Page 70975telehealth services. In addition, we note that information about how to submit a request to add a service to the telehealth list is available on the CMS Web site at www.cms.gov/​telehealth.

Comment: Commenters were concerned that there was a discrepancy in reimbursement between the PFS and the OPPS.

Response: Payments made under the PFS and the OPPS are established under different statutory provisions using different bases and methodologies, and therefore often result in differential payment amounts for similar services.

Comment: Several commenters pointed out that there were no malpractice or PE inputs for G0296 and G0297 in the downloads available with the proposed rule.

Response: We appreciate commenters' attention to detail and we have corrected these values in this final rule with comment period.

After consideration of the comments received, we are finalizing the work RVUs for G0296 and G0297 as proposed.

7. Direct PE Input-Only Recommendations

In CY 2014, 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. In developing the proposal, we sought a reliable means for Medicare to set upper payment limits for office-based procedures given our several longstanding concerns regarding the accuracy of certain aspects of the direct PE inputs, including both items and procedure time assumptions, and prices of individual supplies and equipment (78 FR 74248 through 74250). After considering the many comments we received regarding our proposal, the majority of which urged us to withdraw the proposal for a variety of reasons, we decided not to finalize the policy. However, we continue to believe that using PE data that are auditable, comprehensive, and regularly updated would contribute to the accuracy of PE calculations.

Subsequent to our decision not to finalize the proposal, the RUC forwarded direct PE input recommendations for a subset of codes with nonfacility PE RVUs that would have been limited by the policy. Some of these codes also include work RVUs, but the RUC recommendations did not address the accuracy of those values.

We generally believe that combined reviews of work and PE for each code under the potentially misvalued codes initiative leads to more accurate and appropriate assignment of RVUs. We also believe, and have previously stated, that our standard process for evaluating potentially misvalued codes is unlikely to be the most effective means of addressing our concerns regarding the accuracy of some aspects of the direct PE inputs (79 FR 74248).

However, we also believe it is important to use the most accurate and up-to-date information available to us when developing PFS RVUs for individual services. Therefore, we reviewed the RUC-recommended direct PE inputs for these services and proposed to use them, with the refinements addressed in this section. However, we also identified these codes as potentially misvalued because their direct PE inputs were not reviewed alongside review of their work RVUs and time. We considered not addressing these recommendations until such time as comprehensive reviews could occur, but we recognized the public interest in using the updated recommendations regarding the PE inputs until such time as the work RVUs and time can be addressed. Therefore, we noted that while we proposed adjusted PE inputs for these services based on these recommendations, we would anticipate addressing any corresponding change to direct PE inputs once the work RVUs and time are addressed.

a. Repair of Nail Bed (CPT Code 11760)

The RUC recommendation for CPT code 11760 included 22 minutes assigned to clinical labor task “Assist physician in performing procedure.” Because CPT code 11760 has 33 minutes of work intraservice time, we believe that this clinical labor input was intended to be calculated at 67 percent of work time. However, the equipment times were also calculated based on the 22 minutes of intraservice time. We proposed to use the RUC-recommended equipment times while we solicited comments on whether or not it would be appropriate to include the full 33 minutes of work intraservice time for the equipment.</