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Proposed Rule

Medicare Program; Revisions to Payment Policies Under the Physician Fee Schedule and Other Revisions to Part B for CY 2017; Medicare Advantage Pricing Data Release; Medicare Advantage and Part D Medical Low Ratio Data Release; Medicare Advantage Provider Network Requirements; Expansion of Medicare Diabetes Prevention Program Model

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AGENCY:

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

ACTION:

Proposed rule.

SUMMARY:

This major proposed rule addresses changes to the physician fee schedule and other Medicare Part B payment policies, such as changes to the Value Modifier, 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. This proposed rule also includes proposals related to the Medicare Shared Saving Program, and the release of certain pricing data from Medicare Advantage bids and medical loss ratio reports from Medicare health and drug plans. In addition, this rule proposes to expand the Medicare Diabetes Prevention Program model.

DATES:

To be assured consideration, comments must be received at one of the addresses provided below, no later than 5 p.m. on September 6, 2016.

ADDRESSES:

In commenting, please refer to file code CMS-1654-P. 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-1654-P, 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-1654-P, 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.

Start Further Info

FOR FURTHER INFORMATION CONTACT:

Jessica Bruton, (410) 786-5991 for issues related to any physician payment issues not identified below.

Gail Addis, (410) 786-4522, for issues related to diabetes self-management training.

Jaime Hermansen, (410) 786-2064, for issues related to moderate sedation coding and anesthesia services.

Jessica Bruton, (410) 786-5991, for issues related to identification of potentially misvalued services.

Roberta Epps, (410) 786-4503, for issues related to PAMA section 218(a) policy and the transition from traditional x-ray imaging to digital radiography.

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

Ann Marshall, (410) 786-3059, for primary care issues related to chronic care management (CCM), burden reduction and evaluation and management services.

Emily Yoder, (410) 786-1804, for primary care issues related to resource intensive services and other primary care issues.

Lindsey Baldwin, (410) 786-1694, for primary care issues related to behavioral health integration services.

Geri Mondowney, (410) 786-4584, and Donta Henson, (410) 786-1947, for issues related to geographic practice cost indices.

Michael Soracoe, (410) 786-6312, for issues related to the target and phase-in provisions, the practice expense methodology, impacts, conversion factor, and the valuation of surgical procedures.

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

Patrick Sartini, (410) 786-9252, for issues related to malpractice RVUs, radiation treatment, mammography and other imaging services.

Kathy Bryant, (410) 786-3448, for issues related to collecting data on resources used in furnishing global services.

Donta Henson, (410) 786-1947, for issues related to pathology and ophthalmology services.

Corinne Axelrod, (410) 786-5620, for issues related to rural health clinics or federally qualified health centers for comprehensive care management services furnished incident to.

Simone Dennis (410) 786-8409, for issues related to FQHC-specific market basket.

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

Erin Skinner (410) 786-0157, for issues related to open payments.

Sean O'Grady (410) 786-2259, or Julie Uebersax (410) 786-9284, for issues related to release of pricing data from Medicare Advantage bids and release of medical loss ratio data submitted by Medicare Advantage organizations and Part D sponsors.

Sara Vitolo (410) 786-5714, for issues related to prohibition on billing qualified Medicare beneficiary individuals for Medicare cost-sharing.

Michelle Peterman (410) 786-2591, for issues on the technical correction for PQRS.

Katie Mucklow (410) 786-0537 or John Spiegel (410) 786-1909, for issues related to Provider Enrollment Medicare Advantage Program.

Jen Zhu (410) 786-3725, Carlye Burd (410) 786-1972, or Nina Brown (410) Start Printed Page 46163786-6103, for issues related to Medicare Diabetes Prevention Program model expansion.

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

Sabrina Ahmed (410) 786-7499, or Fiona Larbi (410) 786-7224, for issues related to Value-based Payment Modifier and Physician Feedback Program.

Lisa Ohrin Wilson (410) 786-8852, or Gabriel Scott (410) 786-3928, for issues related to physician self-referral updates.

End Further Info End Preamble Start Supplemental Information

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.

Table of Contents

I. Executive Summary and Background

A. Executive Summary

B. Background

II. Provisions of the Proposed Rule for PFS

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

B. Determination of Malpractice Relative Value Units (MRVUs)

C. Medicare Telehealth Services

D. Potentially Misvalued Services Under the Physician Fee Schedule

1. Background

2. Progress in Identifying and Reviewing Potentially Misvalued Codes

3. Validating RVUs of Potentially Misvalued Codes

4. CY 2017 Identification and Review of Potentially Misvalued Services

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

6. Collecting Data on Resources Used in Furnishing Global Services

E. Improving Payment Accuracy for Primary Care, Care Management Services, and Patient-Centered Services

F. Improving Payment Accuracy for Preventive Services: Diabetes Self-Management Training (DSMT)

G. Target for Relative Value Adjustments for Misvalued Services

H. Phase-In of Significant RVU Reductions

I. Geographic Practice Cost Indices (GPCIs)

J. Payment Incentive for the Transition From Traditional X-Ray Imaging to Digital Radiography and Other Imaging Services

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

L. Valuation of Specific Codes

III. Other Provisions of the Proposed Rule for PFS

A. Chronic Care Management (CCM) and Transitional Care Management (TCM) Supervision Requirements in Rural Health Clinics (RHCs) and Federally Qualified Health Centers (FQHCs)

B. FQHC-Specific Market Basket

C. Appropriate Use Criteria for Advanced Diagnostic Imaging Services

D. Reports of Payments or Other Transfers of Value to Covered Recipients: Solicitation of Public Comments

E. Release of Part C Medicare Advantage Bid Pricing Data and Part C and Part D Medical Loss Ratio (MLR) Data

F. Prohibition on Billing Qualified Medicare Beneficiary Individuals for Medicare Cost-Sharing

G. Recoupment or Offset of Payments to Providers Sharing the Same Taxpayer Identification Number

H. Accountable Care Organization (ACO) Participants Who Report Physician Quality Reporting System (PQRS) Quality Measures Separately

I. Medicare Advantage Provider Enrollment

J. Proposed Expansion of the Diabetes Prevention Program (DPP) Model

K. Medicare Shared Savings Program

L. Value-Based Payment Modifier and Physician Feedback Program

M. Physician Self-referral Updates

IV. Collection of Information Requirements

V. Response to Comments

VI. Regulatory Impact Analysis

Regulations Text

Acronyms

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

A1c—Hemoglobin A1c

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

CoA—Certificate of Accreditation

CoC—Certificate of Compliance

CoR—Certificate of Registration

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 2015 American Medical Association. All rights reserved.)

CQM—Clinical quality measure

CSW—Clinical social worker

CT—Computed tomography

CW—Certificate of Waiver

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

ED—Emergency Department

EHR—Electronic health record

E/M—Evaluation and management

EMT—Emergency Medical Technician

EP—Eligible professional

eRx—Electronic prescribing

ESRD—End-stage renal disease

FAR—Federal Acquisition Regulations

FDA—Food and Drug Administration

FFS—Fee-for-service

FQHC—Federally qualified health center

FR—Federal Register

GAF—Geographic adjustment factor

GAO—Government Accountability Office

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

MACRA—Medicare Access and CHIP Reauthorization Act of 2015 (Pub. L. 114-10)

MAP—Measure Applications Partnership

MAPCP—Multi-payer Advanced Primary Care Practice

MAV—Measure application validity [process]

MCP—Monthly capitation paymentStart Printed Page 46164

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

PPM—Provider-Performed Microscopy

PQRS—Physician Quality Reporting System

PPIS—Physician Practice Expense Information Survey

PT—Physical therapy

PT—Proficiency Testing

PT/INR—Prothrombin Time/International Normalized Ratio

PY—Performance year

QA—Quality Assessment

QC—Quality Control

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 proposed rule 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 2017 PFS Proposed Rule, refer to item CMS-1654-P. 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 Jessica Bruton at (410) 786-5991.

CPT (Current Procedural Terminology) Copyright Notice

Throughout this proposed rule, 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 proposed rule proposes to revise payment polices under the Medicare Physician Fee Schedule (PFS) and make other policy changes related to Medicare Part B payment. These changes would be applicable to services furnished in CY 2017. In addition, this proposed rule includes proposals related to: the Medicare Shared Savings Program and release of pricing data submitted to CMS by Medicare Advantage (MA) organizations; and medical loss ratio reports submitted by MA plans and Part D plans. These additional proposals are addressed in section III. of this proposed rule.

2. Summary of the Major Provisions

The statute 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 statute 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 proposed rule, we are proposing to establish RVUs for CY 2017 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 proposed rule includes discussions and proposals regarding:

  • Potentially Misvalued PFS Codes.
  • Telehealth Services.
  • Establishing Values for New, Revised, and Misvalued Codes.
  • Target for Relative Value Adjustments for Misvalued Services.
  • Phase-in of Significant RVU Reductions.
  • Chronic Care Management (CCM) and Transitional Care Management (TCM) Supervision Requirements in Rural Health Clinics (RHCs) and Federally Qualified Health Centers (FQHCs).
  • FQHC-Specific Market Basket.
  • Appropriate Use Criteria for Advanced Diagnostic Imaging Services.
  • Reports of Payments or Other Transfers of Value to Covered Recipients: Solicitation of Public Comments.
  • Release of Part C Medicare Advantage Bid Pricing Data and Part C and Part D Medical Loss Ratio (MLR) Data.
  • Prohibition on Billing Qualified Medicare Beneficiary Individuals for Medicare Cost-Sharing.
  • Recoupment or Offset of Payments to Providers Sharing the Same Taxpayer Identification Number.
  • Accountable Care Organization (ACO) Participants Who Report Physician Quality Reporting System (PQRS) Quality Measures Separately.
  • Medicare Advantage Provider Enrollment.
  • Proposed Expansion of the Diabetes Prevention Program (DPP) Model.
  • Medicare Shared Savings Program.
  • Value-Based Payment Modifier and the Physician Feedback Program.
  • Physician Self-referral Updates.

3. Summary of Costs and Benefits

The statute requires that annual adjustments to PFS RVUs may not cause annual estimated expenditures to differ by more than $20 million from what Start Printed Page 46165they 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 proposed in this proposed rule would affect the specialty distribution of Medicare expenditures. When considering the combined impact of proposed work, PE, and MP RVU changes, the projected payment impacts would be small for most specialties; however, the impact would be larger for a few specialties.

We have determined that this major proposed rule is economically significant. For a detailed discussion of the economic impacts, see section VI. of this proposed rule.

B. Background

Since January 1, 1992, Medicare has paid for physicians' services under section 1848 of the Social Security Act (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 proposed rule, 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. 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.

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 Start Printed Page 46166in 2001 and 2003, respectively, (66 FR 55246 and 68 FR 63196) extended the period during which we would accept these supplemental data through March 1, 2005.

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

c. Malpractice RVUs

Section 4505(f) of the BBA amended section 1848(c) of the Act to require that we implement resource-based MP RVUs for services furnished on or after CY 2000. The resource-based MP RVUs were implemented in the PFS final rule with comment period published November 2, 1999 (64 FR 59380). The MP RVUs are based on 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 proposed rule.

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 proposed rule, 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.

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 ensure 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 (Pub. L. 113-93, enacted on April 1, 2014) (PAMA) 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.

Subsequently, section 202 of the Achieving a Better Life Experience Act of 2014 (Division B of Pub. L. 113-295, enacted December 19, 2014) (ABLE) 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 was finalized in the CY 2016 PFS final rule with comment period, and proposed revisions are discussed in section II.G. of this proposed rule.

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 Start Printed Page 46167adjustments 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 was finalized in the CY 2016 PFS final rule with comment period and proposed revisions in this year's rulemaking are discussed in section II.H. of this proposed rule.

II. Provisions of the Proposed Rule 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).

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 Medicare Economic Index (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). We have incorporated the available utilization data for interventional cardiology, which became a recognized Medicare specialty during 2014. We finalized the use of a proxy PE/HR value for interventional cardiology in the CY 2016 final rule with comment period (80 FR 70892), as there are no PPIS data for this specialty, by crosswalking the PE/HR for from Start Printed Page 46168Cardiology, since the specialties furnish similar services in the Medicare claims data.

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 proposed rule 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 initial indirect allocator would equal 6.00, resulting in a total PE RVUs of 8.00 (2.00 is 25 percent of 8.00 and 6.00 is 75 percent of 8.00).
  • Next, we 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.

(3) 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. 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. For this reason, 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.

(4) Services With Technical Components (TCs) and Professional Components (PCs)

Diagnostic services are generally composed 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.)

(5) 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). We also direct interested readers to the file called “Calculation of PE RVUs under Methodology for Selected Codes” which is available on our Web site under downloads for the CY 2017 PFS proposed rule at http://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​PhysicianFeeSched/​PFS-Federal-Regulation-Notices.html. This file contains a table that illustrates the calculation of PE RVUs as described below for individual PFS codes.

(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.

Step 2: Calculate the aggregate pool of direct PE costs for the current year. We 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.

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 factor 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 Start Printed Page 46169influence 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.

We use an average of the 3 most recent years of available Medicare claims data to determine the specialty mix assigned to each code. As we stated in the CY 2016 final rule with comment period (80 FR 70894), we believe that the 3-year average will mitigate the need to use dominant or expected specialty instead of the claims data. Because we are incorporating CY 2015 claims data for use in the CY 2017 proposed rates, we believe that the proposed PE RVUs associated with the CY 2017 PFS proposed rule provide a first opportunity to determine whether service-level overrides of claims data are necessary. Currently, in the development of PE RVUs we apply only the overrides that also apply to the MP RVU calculation. Since the proposed PE RVUs include a new year of claims into the 3 year average for the first time, we are seeking comment on the proposed CY 2017 PFS rates and whether or not the incorporation of a new year of utilization data into a three year average mitigates the need for alternative service-level overrides such as a claims-based approach (dominant specialty) or stakeholder-recommended approach (expected specialty) in the development of PE (and MP) RVUs for low-volume codes. Prior year RVUs are available at several locations on the PFS Web site located at http://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​PhysicianFeeSched/​.

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 the download file called “Calculation of PE RVUs under Methodology for Selected Codes”, 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 8 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 5 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 sum of steps 5 and 17 of to the proposed aggregate work RVUs scaled by the ratio of current aggregate PE and work RVUs. This adjustment ensures that all PE RVUs in the PFS account for the fact that certain specialties are excluded from the calculation of PE RVUs but included in maintaining overall PFS budget neutrality. (See “Specialties excluded from ratesetting 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.Start Printed Page 46170

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%.
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.
Start Printed Page 46171
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 proposed rule.

(6) Equipment Cost Per Minute

The equipment cost per minute is calculated as:

(1/(minutes per year * usage)) * price * ((interest rate/(1 − (1/((1 + interest rate) ^ life of equipment)))) + maintenance)

Where:

minutes per year = maximum minutes per year if usage were continuous (that is, usage = 1); generally 150,000 minutes.

usage = variable, see discussion below.

price = price of the particular piece of equipment.

life of equipment = useful life of the particular piece of equipment.

maintenance = factor for maintenance; 0.05.

interest rate = variable, see discussion below.

Usage: We currently use an equipment utilization rate assumption of 50 percent for most equipment, with the exception of expensive diagnostic imaging equipment, for which we use a 90 percent assumption as required by section 1848(b)(4)(C) of the Act.

Stakeholders have often suggested that particular equipment items are used less frequently than 50 percent of the time in the typical setting and that CMS should reduce the equipment utilization rate based on these recommendations. We appreciate and share stakeholders' interest in using the most accurate assumption regarding the equipment utilization rate for particular equipment items. However, we believe that absent robust, objective, auditable data regarding the use of particular items, the 50 percent assumption is the most appropriate within the relative value system. We welcome the submission of data that illustrates an alternative rate.

Maintenance: This factor for maintenance was proposed and finalized during rulemaking for CY 1998 PFS (62 FR 33164).

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

Interest Rate: In the CY 2013 PFS 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 are not proposing any changes to these interest rates for CY 2017.

Table 3—SBA Maximum Interest Rates

PriceUseful life (years)Interest rate (%)
<$25K<77.50
$25K to $50K<76.50
>$50K<75.50
<$25K7+8.00
$25K to $50K7+7.00
>$50K7+6.00

d. Proposed Changes to Direct PE Inputs for Specific Services

This section focuses on specific PE inputs. The direct PE inputs are included in the CY 2017 direct PE input database, which is available on our Web site under downloads for the CY 2017 PFS proposed rule 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 the CY 2015 PFS rulemaking cycle, 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 previously specified list of codes since these items were 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 had been become typically used in furnishing imaging services. However, since we did not receive any invoices for the PACS system prior to that year's proposed rule, we were unable to determine the appropriate pricing to use for the inputs. For CY 2015, we 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 (79 FR 67561-67563). We used the 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. We received invoices from one stakeholder that facilitated a proposed price update for the PACS workstation in the CY 2016 PFS proposed rule, and we updated the price for the PACS workstation to $5,557 in the CY 2016 PFS final rule with comment period (80 FR 70899).

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 PFS final rule with comment period (79 FR 67563), we generally believe that workstations used by these practitioners Start Printed Page 46172are 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, such as the view box equipment. Given that the majority of these services are reported globally in the nonfacility setting, we believe it is appropriate to include these costs as direct inputs for the associated HCPCS codes. Based on our established methodology in which single codes with professional and technical components are constructed by assigning work RVUs exclusively to the professional component and direct PE inputs exclusively to the technical components, these costs would be incorporated into the PE RVUs of the global and technical component of the HCPCS code.

We stated in the CY 2016 PFS final rule with comment period that the costs of the professional workstation may be analogous to costs related to the use of film previously incorporated as direct PE inputs for these services. We also 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. Commenters responded by indicating their approval of the concept of a professional PACS workstation used for interpretation of digital images. We received invoices for the pricing of a professional PACS workstation, as well as additional invoices for the pricing of a mammography-specific version of the professional PACS workstation. The RUC also included these new equipment items in its recommendations for the CY 2017 PFS rulemaking cycle.

Based on our analysis of submitted invoices, we are proposing to price the professional PACS workstation (ED053) at $14,616.93. We are not proposing a change in price for the current technical PACS workstation (ED050), which will remain at a price of $5,557.00.

The price of the professional PACS workstation is based upon individual invoices submitted for the cost of a PC Tower ($1531.52), a pair of 3 MP monitors ($10,500.00 in total), a keyboard and mouse ($84.95), a UPS power backup devices for TNP ($1098.00), and a switch for PACS monitors/workstations ($1402.46).

We are proposing to add the professional PACS workstation to many CPT codes in the 70000 series that use the current technical PACS workstation (ED050) and include professional work for which such a workstation would be used. We are not proposing to add the equipment item to add-on codes since the base codes would include minutes for the item. We are also not proposing to add the item to codes that are therapeutic in nature, as the professional PACS workstation is intended for use in diagnostic services. We are therefore not proposing to add the item to codes in the Radiation Therapy section (77261 through 77799) or the Nuclear Medicine Cardiology section (78414-78499). We also are not proposing to add the item to image guidance codes where the dominant provider is not a radiologist (77002, 77011, 77071, 77077, and 77081) according to the most recent year of claims data, since we believe a single workstation would be more typical in those cases. We have identified approximately 426 codes to which we are proposing to add a professional PACS workstation. Please see Table 4 for the full list of affected codes.

For the professional PACS workstation, we are proposing to assign equipment time equal to the intraservice work time plus half of the preservice work time associated with the codes, since the work time generally reflects the time associated with the professional interpretation. We are proposing half of the preservice work time for the professional PACS workstation, as we do not believe that the practitioner would typically spend all of the preservice work period using the equipment. For older codes that do not have a breakdown of physician work time by service period, and only have an overall physician work time, we are proposing to use half the total work time as an approximation of the intraservice work time plus one half of the preservice work time. In our review of services that contained an existing PACS workstation and had a breakdown of physician work time, we found that half of the total time was a reasonable approximation for the value of intraservice work time plus one half of preservice work time where no such breakdown existed. We also considered using an equipment time formula of the physician intraservice time plus 1 minute (as a stand-in for the physician preservice work time). We are seeking public comment on the most accurate equipment time formula for the professional PACS workstation.

We are seeking public comment on the proposed list of codes that would incorporate either the professional PACS workstation. We are interested in public comment on the codes for which a professional PACS workstation should be included, and whether one of these professional workstations should be included for codes outside the 70000 series. In cases within the 70000 series where radiologists are not the typical specialty reporting the code, such as CPT codes 77002 and 77011, we are asking whether it would be appropriate to add one of the professional PACS workstations to these services.

Table 4—Codes With Professional PACS Workstation in the Proposed Direct PE Input Database

HCPCSED053 minutes
7001512
700303
701003
701104
701203
701304
701344
701403
701504
701603
701903
702004
702103
702204
702403
702504
702607
703002
703103
703203
703283
7033022
703326
7033620
703503
703555
703603
703704
703719
703803
703905
7045012
7046015
7047018
7048013
7048113
7048214
7049013
7049113
7049214
7054014
7054219
7054319
7054413
7054518
7054618
7054713
7054820
7054925
7055121
7055223
7055328
7055443
710104
710153
Start Printed Page 46173
710204
710214
710224
710235
710304
710345
710353
711005
711014
711104
711115
711203
711303
7125018
7126017
7127013
7127528
7155015
7155130
7155228
7155533
720203
720404
720506
720526
720704
720723
720743
720803
720816
720827
720838
720849
721004
721106
721146
721204
7212518
7212612
7212712
7212818
7212912
7213012
7213118
7213212
7213312
7214123
7214226
7214623
7214726
7214823
7214926
7215628
7215728
7215828
7215931
721705
721903
7219128
7219212
7219312
7219412
7219530
7219626
7219730
7219828
722003
722023
722203
7224019
7225518
7226518
7227023
7227536
722859
722959
730003
730103
730203
730305
730406
730503
730604
730703
730804
730856
730903
730923
731004
731104
731156
731204
731304
731403
7320018
7320111
7320212
7320635
7321825
7321925
7322030
7322123
7322223
7322335
7322531
735014
735025
735036
735215
735226
735237
735256
735514
735525
735604
735646
735654
735806
735904
735923
736004
736104
736156
736204
736304
736503
736603
7370018
7370111
7370212
7370635
7371820
7371925
7372030
7372123
7372224
7372332
7372533
740004
740103
740204
740224
7415014
7416017
7417021
7417433
7417528
7417625
7417728
7417833
7418115
7418228
7418335
7418533
742105
742205
7423012
742407
742417
742459
742467
7424718
742499
742505
7425133
742606
7426143
7426248
7426342
742707
7428023
7428319
742904
7440018
744106
744156
744304
744405
744554
744856
747104
7471268
747405
7555745
7555958
7556150
7556366
7557113
7557225
7557338
7557435
756006
7560511
7562511
7563013
7563550
7565813
7570520
7571011
7571613
7572611
Start Printed Page 46174
7573111
7573313
7573611
7574113
7574316
7574611
7575611
7579133
758095
758207
7582211
7582511
7582711
7583111
7583314
7584011
7584214
7586011
7587011
7587211
758807
7588514
7588714
7588911
7589111
758936
7590111
7590213
759626
7596613
759786
759848
7598912
760003
760103
760806
760983
761006
761016
761026
761205
763768
7638010
7639028
7650610
7653612
766049
7670014
7670511
7677013
7677511
7677613
7680014
7680118
7680518
7681135
7681323
768158
7681618
7681713
7681835
7681928
7682013
7682113
7682545
7682611
7683013
7683130
7685613
7685710
7687010
7687220
7687340
7688118
7688520
7688615
7693671
7694219
769708
7701211
770149
7702153
770535
770545
7705850
7705955
770723
770745
770756
7707612
7708415
780128
7801313
7801413
7801531
7801649
7801829
7807013
7807118
7807223
7807538
7810218
7810322
7810420
7813548
7814040
7818516
7819040
7819530
7820116
7820220
7820520
7820625
7821513
7821622
7822613
7822718
7823019
7823123
7823228
7825827
7826121
7826225
7826413
7826518
7826623
7827818
7829018
7829131
7830015
7830522
7830611
7831511
7832024
785798
7858013
7858215
7859713
7859813
7860016
7860118
7860521
7860622
7860729
7861010
7863024
7863536
7864532
7864715
7865040
7866016
7870017
7870118
7870722
7870832
7870940
7871021
7874030
7876120
7880028
7880132
7880224
7880343
7880435
7880525
7880623
7880737
7944024
G03899
767X113

(2) Standardization of Clinical Labor Tasks

As we noted in the CY 2015 PFS rule (79 FR 67640-67641), 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 preservice, service, and postservice 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 would facilitate the identification of the usual numbers of minutes for clinical labor tasks and the identification of exceptions to the usual values. It would also allow for greater transparency and consistency in the assignment of equipment minutes based on clinical labor times. Finally, we believe that the Start Printed Page 46175information 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 preservice time packages. We believe such standards would 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.

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 the CY 2015 PFS rule, 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 for each code the minutes 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 that occur in multiple codes, consistent with the changes that were made to individual supply and equipment items. In the meantime, we believe it would be appropriate to establish standard times for clinical labor tasks associated with all digital imaging services for purposes of reviewing individual services at present, and for possible broad-based standardization once the changes to the direct PE input database facilitate our ability to adjust time across services. During the CY 2016 PFS rulemaking cycle, we proposed appropriate standard minutes for five different clinical labor tasks associated with services that use digital imaging technology. In the CY 2016 PFS final rule with comment period (80 FR 70901), we finalized appropriate standard minutes for four of those five activities, which are listed in Table 5.

Table 5—Clinical Labor Tasks Associated With Digital Imaging 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 radiologist2
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 queue1

We did not finalize standard minutes for the activity “Technologist QC's images in PACS, checking for all images, reformats, and dose page.” We agreed with commenters that this task may require a variable length of time depending on the number of images to be reviewed. We stated 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 solicited public comment and feedback on this subject, with the anticipation of including a proposal in the CY 2017 proposed rule.

We received many comments suggesting that this clinical labor activity should not have a standard time value. Commenters stated that the number of minutes varies significantly for different imaging modalities; and the time is not simply based on the quantity of images to be reviewed, but also the complexity of the images. The commenters recommended that time for this clinical labor activity should be assigned on a code by code basis. We agree with the commenters that the amount of clinical labor needed to check images in a PACS workstation may vary depending on the service. However, we do not believe that this precludes the possibility of establishing standards for clinical labor tasks as we have done in the past by creating multiple standard times, for example, those assigned to cleaning different kinds of scopes. We continue to believe that the use of clinical labor standards provides greater consistency among codes that share the same clinical labor tasks and can improve relativity of values among codes. We are proposing to establish a range of appropriate standard minutes for the clinical labor activity Technologist QCs images in PACS, checking for all images, reformats, and dose page. These standard minutes will be applied to new and revised codes that make use of this clinical labor activity when they are reviewed by us for valuation. We are proposing 2 minutes as the standard for the simple case, 3 minutes as the standard for the intermediate case, and 4 minutes as the standard for the complex case. We are proposing the simple case of 2 minutes as the standard for the typical procedure code involving routine use of imaging. These values are based upon a review of the existing minutes assigned for this clinical labor activity; we have determined that 2 minutes is the duration for most services and a small number of codes with more complex forms of digital imaging have higher values. We are proposing to use 2 minutes for services involving routine x-rays (simple), 3 minutes for services involving CTs and MRIs (intermediate), and 4 minutes for the most highly complex services which would exceed these more typical cases. We are soliciting comments regarding the most accurate category—simple, intermediate, or complex for existing codes, and in particular what criteria Start Printed Page 46176might be used to identify complex cases systematically.

(b) Pathology Clinical Labor Tasks

As with the clinical labor tasks associated with digital imaging, many of the currently assigned times for the specialized clinical labor tasks associated with pathology services are not consistent across codes. In reviewing past RUC 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 high degree of specificity with which the tasks are described. We continue to believe that, in general, a clinical labor task will tend to take the same amount of time to perform as the same clinical labor task when it is performed in a clinically similar service.

Therefore, we developed standard times for clinical labor tasks that we have used in finalizing direct PE inputs in recent years, starting in the CY 2012 PFS final rule with comment period (76 FR 73213). These times were based on our review and assessment of the current times included for these clinical labor tasks in the direct PE input database. We proposed in the CY 2016 PFS proposed rule to establish standard times for a list of 17 clinical labor tasks related to pathology services, and solicited public feedback regarding our proposed standards. Many commenters stated in response to our proposal that they did not support the standardization of clinical labor activities across pathology services. Commenters stated that establishing 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 might be possible to standardize across codes with the same batch sizes, and urged us to consider pathology-specific details, such as batch size and block number, in the creation of any future standard times for clinical labor tasks related to 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, generally speaking, clinical labor tasks with the same description are comparable across different pathology procedures. We believe this to be true based on the comparability of clinical labor tasks in non-pathology services, as well as the high degree of specificity with which most pathology tasks are described relative to clinical labor tasks associated with other PFS services. We concurred 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 also believe that it is appropriate and feasible to establish “per block” standards or standards varied by batch size assumptions for many clinical labor activities that would 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 requested regular submission of these details on the PE worksheets supplied by the RUC as part of the review process for pathology services, as a means to assist in the determination of the most accurate direct PE inputs.

We also stated our belief that many of the clinical labor activities for which we proposed to establish standard times were 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 that additional time may be required above the standard value for a clinical labor task that is part of an unusually complex or difficult service. As a result, we ultimately finalized standard times for 6 of the 17 proposed clinical labor activities in the CY 2016 final rule with comment period (80 FR 70902). We have listed the finalized standard times in Table 6. We are currently proposing no further action on the remaining 11 clinical labor activities pending further action by the RUC (see below).

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
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
Prepare, pack and transport specimens and records for in-house storage and external storage (where applicable)1

We remain committed to the process of establishing standard clinical labor times for tasks associated with pathology services. This may include establishing standards on a per-block or per-batch basis, as we indicated during the previous rulemaking cycle. However, we are aware that the PE Subcommittee of the RUC is currently working to standardize the pathology clinical labor activities they use in making their recommendations. We believe the RUC's efforts to narrow the current list of several hundred pathology clinical labor tasks to a more manageable number through the consolidation of duplicative or highly similar activities into a single description may serve PFS relativity and facilitate greater transparency in PFS ratesetting. We also believe that the RUC's standardization of pathology clinical labor tasks would facilitate our capacity to establish standard times for pathology clinical labor tasks in future rulemaking. Therefore, we are not proposing any additional change to clinical labor tasks associated with pathology services at this time.

(3) Equipment Recommendations for Scope Systems

During our routine reviews of direct PE input recommendations, we have regularly found unexplained inconsistencies involving the use of scopes and the video systems associated with them. Some of the scopes include video systems bundled into the Start Printed Page 46177equipment item, some of them include scope accessories as part of their price, and some of them are standalone scopes with no other equipment included. It is not always clear which equipment items related to scopes fall into which of these categories. We have also frequently found anomalies in the equipment recommendations, with equipment items that consist of a scope and video system bundle recommended along with a separate scope video system. Based on our review, the variations do not appear to be consistent with the different code descriptions.

To promote appropriate relativity among the services and facilitate the transparency of our review process, during review of recommended direct PE inputs for the CY 2017 PFS proposed rule, we developed a structure that separates the scope and the associated video system as distinct equipment items for each code. Under this approach, we are proposing standalone prices for each scope, and separate prices for the video systems that are used with scopes. We would define the scope video system as including: (1) A monitor; (2) a processor; (3) a form of digital capture; (4) a cart; and (5) a printer. We believe that these equipment components represent the typical case for a scope video system. Our model for this system is the “video system, endoscopy (processor, digital capture, monitor, printer, cart)” equipment item (ES031), which we are proposing to re-price as part of this separate pricing approach. We obtained current pricing invoices for the endoscopy video system as part of our investigation of these issues involving scopes, which we are proposing to use for this re-pricing. We understand that there may be other accessories associated with the use of scopes; we are proposing to separately price any scope accessories, and individually evaluate their inclusion or exclusion as direct PE inputs for particular codes as usual under our current policy based on whether they are typically used in furnishing the services described by the particular codes.

We are also proposing standardizing refinements to the way scopes have been defined in the direct PE input database. We believe that there are four general types of scopes: Non-video scopes; flexible scopes; semi-rigid scopes, and rigid scopes. Flexible scopes, semi-rigid scopes, and rigid scopes would typically be paired with one of the video scope systems, while the non-video scopes would not. The flexible scopes can be further divided into diagnostic (or non-channeled) and therapeutic (or channeled) scopes. We are proposing to identify for each anatomical application: (1) A rigid scope; (2) a semi-rigid scope; (3) a non-video flexible scope; (4) a non-channeled flexible video scope; and (5) a channeled flexible video scope. We are proposing to classify the existing scopes in our direct PE database under this classification system, to improve the transparency of our review process and improve appropriate relativity among the services. We plan to propose input prices for these equipment items through future rulemaking.

We have proposed these changes only for the reviewed codes that make use of scopes; this applies to the codes in the Flexible Laryngoscopy family (CPT codes 31575, 31576, 31577, 31578, 315X1, 315X2, 315X3, 31579) (see section II.L) and the Laryngoplasty family (CPT codes 31580, 31584, 31587, 315Y1, 315Y2, 315Y3, 315Y4, 315Y5, 315Y6) (see section II.L) along with updated prices for the equipment items related to scopes utilized by these services. We are also soliciting comment on this separate pricing structure for scopes, scope video systems, and scope accessories, which we could consider proposing to apply to other PFS codes in future rulemaking.

(4) Technical Corrections to Direct PE Input Database

Subsequent to the publication of the CY 2016 PFS final rule with comment period, stakeholders alerted us to several clerical inconsistencies in the direct PE database. We propose to correct these inconsistencies as described below and reflected in the CY 2017 direct PE input database displayed on our Web site under downloads for the CY 2017 PFS proposed rule at http://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​PhysicianFeeSched/​PFS-Federal-Regulation-Notices.html.

For CY 2017, we are proposing the following technical corrections:

  • For CPT codes 72081-72084, a stakeholder informed us that the equipment time for the PACS workstation (ED050) should be equal to the clinical labor during the service period; the equipment time formula we used for these codes for CY 2016 erroneously included 4 minutes of preservice clinical labor. We agree with the stakeholder that the PACS workstation should use the standard equipment time formula for a PACS workstation for these codes. As a result, we are proposing to refine the ED050 equipment time to 21 minutes for CPT code 72081, 36 minutes for CPT code 72082, 44 minutes for CPT code 72083, and 53 minutes for CPT code 72084 to reflect the clinical labor time associated with these codes. This same commenter also indicated that a number of clinical labor activities had been entered in the database in the incorrect service period for CPT codes 37215, 50432, 50694, and 72081. These clinical labor activities were incorrectly listed in the “postservice” period instead of the “service post” period. We are proposing to make these technical corrections as well so that the minutes are assigned to the appropriate service period within the direct PE input database.
  • Another stakeholder alerted us that Ileoscopy codes 44380, 44381 and 44382 did not include the direct PE input equipment item called the Gomco suction machine (EQ235) and indicated that this omission appeared to be inadvertent. We agree that it was. We have included the item EQ235 in the proposed direct PE input database for CPT code 44380 at a time of 29 minutes, for CPT code 44381 at a time of 39 minutes, and to CPT code 44382 at a time of 34 minutes.

The PE RVUs displayed in Addendum B on our Web site were calculated with the inputs displayed in the CY 2017 direct PE input database.

(5) Restoration of Inputs

Several of the PE worksheets included in the RUC recommendations for CY 2016 contained time for the equipment item “xenon light source” (EQ167). Because there appeared 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 believed that the use of only one of these light sources would be typical and removed the xenon light equipment time. In the CY 2016 PFS final rule with comment period, we restored the xenon light (EQ167) and removed the fiberoptic headlight (EQ170) with the same number of equipment minutes for CPT codes 30300, 31295, 31296, 31297, and 92511.

We received comments expressing approval for the restoration of the xenon light. However, the commenters also stated that the two light sources were not duplicative, but rather, both a headlight and a xenon light source are required concurrently for otolaryngology procedures when scopes are utilized. The commenters requested that the fiberoptic headlight be restored to these codes.

We agree with the commenters that the use of both light sources would be typical for these procedures. We are therefore proposing to add the fiberoptic headlight (EQ170) to CPT codes 30300, Start Printed Page 4617831295, 31296, 31297, and 92511 at the same number of equipment minutes as the xenon light (EQ167).

(6) Updates to Prices for Existing Direct PE 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. For CY 2017, we are proposing the following price updates for existing direct PE inputs:

Several commenters wrote to discuss the price of the Antibody Estrogen Receptor monoclonal (SL493). We received information including three invoices with new pricing information regarding the SL493 supply. We are proposing to use this information to propose for the supply item SL493 a price of $14.00 per test, which is the average price based on the invoices that we received in total for the item.

We are also proposing to update the price for two supplies in response to the submission of new invoices. The proposed price for “antigen, venom” supply (SH009) reflects an increase from $16.67 to $20.14 per milliliter, and the proposed price for “antigen, venom, tri-vespid” supply (SH010) reflects an increase from $30.22 to $44.05 per milliliter.

We routinely accept public submission of invoices as part of our process for developing payment rates for new, revised, and potentially misvalued codes. Often these invoices are submitted in conjunction with the RUC recommended values for the codes. For CY 2017, we note that some stakeholders have submitted invoices for new, revised, or potentially misvalued codes since the February deadline established for code valuation recommendations. To be included a given year's proposed rule, we generally need to receive invoices by the same February deadline. Of course, we will consider invoices submitted as public comments during the comment period following the publication of the proposed rule, and will consider any invoices received after February and/or outside of the public comment process as part of our established annual process for requests to update supply and equipment prices.

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 expense (MP). 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 comprehensive 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).

To determine MP RVUs for individual PFS services, our MP methodology uses three primary kinds of data: Specialty-level risk factors based on the collection of specialty-specific MP premium data that represent the actual expense incurred by practitioners to obtain MP insurance; Medicare claims data to determine service level risk factors based on a weighted average risk factors of the specialties that furnish each service, and the higher of the work RVU or clinical labor RVU to adjust the service level risk factor for the intensity and complexity of the service. Prior to CY 2016, MP RVUs were only updated once every 5 years, except in the case of new and revised codes.

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 5-year review of MP RVUs were determined either by a direct crosswalk from a similar source code or by a modified crosswalk to account for differences in work RVUs between the new/revised code and the source code. For the modified crosswalk approach, we adjust (or scale) the 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 difference in 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 were 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.

In the CY 2016 PFS final rule with comment period (80 FR 70906 through 70910), we finalized a policy to begin conducting annual MP RVU updates to reflect changes in the mix of practitioners providing services (using Medicare claims data), and to adjust MP RVUs for risk for intensity and complexity (using the work RVU or clinical labor RVU). We also finalized a policy to modify the specialty mix assignment methodology (for both MP and PE RVU calculations) to use an average of the 3 most recent years of data instead of a single year of data. We stated that under this approach, the specialty-specific risk factors would continue to be updated through notice and comment rulemaking every 5 years using updated premium data, but would remain unchanged between the 5-year reviews.

For CY 2016, we did not propose to discontinue 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. We address comments regarding valuation of new and revised codes in section II.L of this proposed rule, which makes clear the codes with interim final values for CY 2016 have newly proposed values for CY 2017, all of which are again open for comment. The MP crosswalks for new and revised codes with interim final values were established in the CY 2016 PFS final rule with comment period; we will respond to comments regarding these interim final values in the CY 2017 PFS final rule.

2. Updating Specialty Specific Risk Factors

The proposed CY 2017 GPCI update (eighth update), discussed in section II.E of this proposed rule, reflects updated MP premium data, collected for the purpose of proposing updates to the MP GPCIs. While we could use the updated MP premium data obtained for the purposes of the proposed eighth GPCI update to propose updates to the specialty risk factors used in the calculation of MP RVUs, this would not be consistent with the policy we previously finalized in the CY 2016 PFS final rule with comment period. In that rule, we indicated that the specialty-specific risk factors would continue to be updated through notice and comment rulemaking every 5 years using updated premium data, but would remain unchanged between the 5-year reviews. Additionally, consistent with the statutory requirement at section 1848(e)(1)(C) of the Act, only 1/2 of the adjustment to MP GPCIs would be applied for CY 2017 based on the new Start Printed Page 46179MP premium data. As such, we do not think it would be appropriate to propose to update the specialty risk factors for CY 2017 based on the updated MP premium data that is reflected in the proposed CY 2017 GPCI update. Therefore, we are not currently proposing to update the specialty-risk factors based on the new premium data collected for the purposes of the 3-year GPCI update for CY 2017 at this time. However, we seek comment on whether we should consider doing so, perhaps as early as for 2018, prior to the fourth review and update of MP RVUs that must occur no later than CY 2020.

C. Medicare Telehealth Services

1. Billing and Payment for Telehealth Services

Several conditions must be met for Medicare to make payments for telehealth services under the PFS. The service must be on the list of Medicare telehealth services and meet all of the following additional requirements:

  • The service must be furnished via an interactive telecommunications system.
  • The service must be furnished by a physician or other authorized practitioner.
  • The service must be furnished to an eligible telehealth individual.
  • The individual receiving the service must be located in a telehealth originating site.

When all of these conditions are met, Medicare pays a facility fee to the originating site and makes a separate payment to the distant site practitioner furnishing the service.

Section 1834(m)(4)(F)(i) of the Act defines Medicare telehealth services to include consultations, office visits, office psychiatry services, and any additional service specified by the Secretary, when furnished via a telecommunications system. We first implemented this statutory provision, which was effective October 1, 2001, in the CY 2002 PFS final rule with comment period (66 FR 55246). We established a process for annual updates to the list of Medicare telehealth services as required by section 1834(m)(4)(F)(ii) of the Act in the CY 2003 PFS final rule with comment period (67 FR 79988).

As specified at § 410.78(b), we generally require that a telehealth service be furnished via an interactive telecommunications system. Under § 410.78(a)(3), an interactive telecommunications system is defined as multimedia communications equipment that includes, at a minimum, audio and video equipment permitting two-way, real-time interactive communication between the patient and distant site physician or practitioner.

Telephones, facsimile machines, and stand-alone electronic mail systems do not meet the definition of an interactive telecommunications system. An interactive telecommunications system is generally required as a condition of payment; however, section 1834(m)(1) of the Act allows the use of asynchronous “store-and-forward” technology when the originating site is part of a federal telemedicine demonstration program in Alaska or Hawaii. As specified in § 410.78(a)(1), asynchronous store-and-forward is the transmission of medical information from an originating site for review by the distant site physician or practitioner at a later time.

Medicare telehealth services may be furnished to an eligible telehealth individual notwithstanding the fact that the practitioner furnishing the telehealth service is not at the same location as the beneficiary. An eligible telehealth individual is an individual enrolled under Part B who receives a telehealth service furnished at a telehealth originating site.

Practitioners furnishing Medicare telehealth services are reminded that these services are subject to the same non-discrimination laws as other services, including the effective communication requirements for persons with disabilities of section 504 of the Rehabilitation Act and language access for persons with limited English proficiency, as required under Title VI of the Civil Rights Act of 1964. For more information, see http://www.hhs.gov/​ocr/​civilrights/​resources/​specialtopics/​hospitalcommunication .

Practitioners furnishing Medicare telehealth services submit claims for telehealth services to the MACs that process claims for the service area where their distant site is located. Section 1834(m)(2)(A) of the Act requires that a practitioner who furnishes a telehealth service to an eligible telehealth individual be paid an amount equal to the amount that the practitioner would have been paid if the service had been furnished without the use of a telecommunications system.

Originating sites, which can be one of several types of sites specified in the statute where an eligible telehealth individual is located at the time the service is being furnished via a telecommunications system, are paid a facility fee under the PFS for each Medicare telehealth service. The statute specifies both the types of entities that can serve as originating sites and the geographic qualifications for originating sites. With regard to geographic qualifications, § 410.78(b)(4) limits originating sites to those located in rural health professional shortage areas (HPSAs) or in a county that is not included in a metropolitan statistical area (MSA).

Historically, we have defined rural HPSAs to be those located outside of MSAs. Effective January 1, 2014, we modified the regulations regarding originating sites to define rural HPSAs as those located in rural census tracts as determined by the Office of Federal Rural Health Policy (FORHP) of the Health Resources and Services Administration (HRSA) (78 FR 74811). Defining “rural” to include geographic areas located in rural census tracts within MSAs allows for broader inclusion of sites within HPSAs as telehealth originating sites. Adopting the more precise definition of “rural” for this purpose expands access to health care services for Medicare beneficiaries located in rural areas. HRSA has developed a Web site tool to provide assistance to potential originating sites to determine their geographic status. To access this tool, see the CMS Web site at https://www.cms.gov/​Medicare/​Medicare-General-Information/​Telehealth/​index.html.

An entity participating in a federal telemedicine demonstration project that has been approved by, or received funding from, the Secretary as of December 31, 2000 is eligible to be an originating site regardless of its geographic location.

Effective January 1, 2014, we also changed our policy so that geographic status for an originating site would be established and maintained on an annual basis, consistent with other telehealth payment policies (78 FR 74400). Geographic status for Medicare telehealth originating sites for each calendar year is now based upon the status of the area as of December 31 of the prior calendar year.

For a detailed history of telehealth payment policy, see 78 FR 74399.

2. Adding Services to the List of Medicare Telehealth Services

As noted previously, in the December 31, 2002 Federal Register (67 FR 79988), we established a process for adding services to or deleting services from the list of Medicare telehealth services. This process provides the public with an ongoing opportunity to submit requests for adding services. Under this process, we assign any qualifying request to make additions to the list of telehealth services to one of two categories. Revisions to criteria that Start Printed Page 46180we use to review requests in the second category were finalized in the November 28, 2011 Federal Register (76 FR 73102). The two categories are:

  • Category 1: Services that are similar to professional consultations, office visits, and office psychiatry services that are currently on the list of telehealth services. In reviewing these requests, we look for similarities between the requested and existing telehealth services for the roles of, and interactions among, the beneficiary, the physician (or other practitioner) at the distant site and, if necessary, the telepresenter, a practitioner who is present with the beneficiary in the originating site. We also look for similarities in the telecommunications system used to deliver the proposed service; for example, the use of interactive audio and video equipment.
  • Category 2: Services that are not similar to the current list of telehealth services. Our review of these requests includes an assessment of whether the service is accurately described by the corresponding code when furnished via telehealth and whether the use of a telecommunications system to deliver the service produces demonstrated clinical benefit to the patient. Submitted evidence should include both a description of relevant clinical studies that demonstrate the service furnished by telehealth to a Medicare beneficiary improves the diagnosis or treatment of an illness or injury or improves the functioning of a malformed body part, including dates and findings, and a list and copies of published peer reviewed articles relevant to the service when furnished via telehealth. Our evidentiary standard of clinical benefit does not include minor or incidental benefits.

Some examples of clinical benefit include the following:

  • Ability to diagnose a medical condition in a patient population without access to clinically appropriate in-person diagnostic services.
  • Treatment option for a patient population without access to clinically appropriate in-person treatment options.
  • Reduced rate of complications.
  • Decreased rate of subsequent diagnostic or therapeutic interventions (for example, due to reduced rate of recurrence of the disease process).
  • Decreased number of future hospitalizations or physician visits.
  • More rapid beneficial resolution of the disease process treatment.
  • Decreased pain, bleeding, or other quantifiable symptom.
  • Reduced recovery time.

For the list of telehealth services, see the CMS Web site at https://www.cms.gov/​Medicare/​Medicare-General-Information/​Telehealth/​index.html.

Requests to add services to the list of Medicare telehealth services must be submitted and received no later than December 31 of each calendar year to be considered for the next rulemaking cycle. For example, qualifying requests submitted before the end of CY 2016 will be considered for the CY 2018 proposed rule. Each request to add a service to the list of Medicare telehealth services must include any supporting documentation the requester wishes us to consider as we review the request. Because we use the annual PFS rulemaking process as a vehicle for making changes to the list of Medicare telehealth services, requesters should be advised that any information submitted is subject to public disclosure for this purpose. For more information on submitting a request for an addition to the list of Medicare telehealth services, including where to mail these requests, see the CMS Web site at https://www.cms.gov/​Medicare/​Medicare-General-Information/​Telehealth/​index.html.

3. Submitted Requests To Add Services to the List of Telehealth Services for CY 2017

Under our existing policy, we add services to the telehealth list on a category 1 basis when we determine that they are similar to services on the existing telehealth list for the roles of, and interactions among, the beneficiary, physician (or other practitioner) at the distant site and, if necessary, the telepresenter. As we stated in the CY 2012 final rule with comment period (76 FR 73098), we believe that the category 1 criteria not only streamline our review process for publicly requested services that fall into this category, but also expedite our ability to identify codes for the telehealth list that resemble those services already on this list.

We received several requests in CY 2015 to add various services as Medicare telehealth services effective for CY 2017. The following presents a discussion of these requests, and our proposals for additions to the CY 2017 telehealth list. Of the requests received, we found that four services were sufficiently similar to ESRD-related services currently on the telehealth list to qualify on a category 1 basis. Therefore, we propose to add the following services to the telehealth list on a category 1 basis for CY 2017:

  • CPT codes 90967 (End-stage renal disease (ESRD) related services for dialysis less than a full month of service, per day; for patients younger than 2 years of age; 90968 (End-stage renal disease (ESRD) related services for dialysis less than a full month of service, per day; for patients 2-11 years of age; 90969 (End-stage renal disease (ESRD) related services for dialysis less than a full month of service, per day; for patients 12-19 years of age); and 90970 (End-stage renal disease (ESRD) related services for dialysis less than a full month of service, per day; for patients 20 years of age and older).

As we indicated in the CY 2015 final rule (80 FR 41783) for the ESRD-related services (CPT codes 90963-90966) added to the telehealth list for CY 2016, the required clinical examination of the catheter access site must be furnished face-to-face “hands on” (without the use of an interactive telecommunications system) by a physician, CNS, NP, or PA. This requirement also applies to CPT codes 90967-90970.

While we did not receive a specific request, we also propose to add two advance care planning services to the telehealth list. We have determined that these services are similar to the annual wellness visits (HCPCS codes G0438 & G0439) currently on the telehealth list:

  • CPT codes 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 care professional; first 30 minutes, face-to-face with the patient, family member(s), or surrogate); and 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 care professional; each additional 30 minutes (list separately in addition to code for primary procedure)).

We also received requests to add services to the telehealth list that do not meet our criteria for Medicare telehealth services. We are not proposing to add the following procedures for the reasons noted:

a. Observation Care: CPT codes—

  • 99217 (observation care discharge day management (this code is to be utilized to report all services provided to a patient on discharge from “observation status” if the discharge is on other than the initial date of “observation status.” To report services to a patient designated as “observation status” or “inpatient status” and discharged on the same date, use the codes for observation or inpatient care services [including admission and discharge services, 99234-99236 as appropriate.]));
  • 99218 (initial observation care, per day, for the evaluation and management Start Printed Page 46181of a patient which requires these three key components: A detailed or comprehensive history; a detailed or comprehensive examination; and medical decision making that is straightforward or of low complexity. Counseling and coordination of care with other physicians, other qualified health care professionals, or agencies are provided consistent with the nature of the problem(s) and the patient's and family's needs. Usually, the problem(s) requiring admission to “observation status” are of low severity. Typically, 30 minutes are spent at the bedside and on the patient's hospital floor or unit);
  • 99219 (initial observation care, per day, for the evaluation and management of a patient, which requires these three key components: A comprehensive history; a comprehensive examination; and medical decision making of moderate complexity. Counseling and coordination of care with other physicians, other qualified health care professionals, or agencies are provided consistent with the nature of the problem(s) and the patient's and family's needs. Usually, the problem(s) requiring admission to “observation status” are of moderate severity. Typically, 50 minutes are spent at the bedside and on the patient's hospital floor or unit);
  • 99220 (initial observation care, per day, for the evaluation and management of a patient, which requires these three key components: A comprehensive history; a comprehensive examination; and medical decision making of high complexity. Counseling and coordination of care with other physicians, other qualified health care professionals, or agencies are provided consistent with the nature of the problem(s) and the patient's and family's needs. Usually, the problem(s) requiring admission to “observation status” are of high severity. Typically, 70 minutes are spent at the bedside and on the patient's hospital floor or unit);
  • 99224 (subsequent observation care, per day, for the evaluation and management of a patient, which requires at least two of these three key components: Problem focused interval history; problem focused examination; medical decision making that is straightforward or of low complexity. Counseling and coordination of care with other physicians, other qualified health care professionals, or agencies are provided consistent with the nature of the problem(s) and the patient's and family's needs. Usually, the patient is stable, recovering, or improving. Typically, 15 minutes are spent at the bedside and on the patient's hospital floor or unit);
  • 99225 (subsequent observation care, per day, for the evaluation and management of a patient, which requires at least two of these three key components: An expanded problem focused interval history; an expanded problem focused examination; medical decision making of moderate complexity. Counseling and coordination of care with other physicians, other qualified health care professionals, or agencies are provided consistent with the nature of the problem(s) and the patient's and family's needs. Usually, the patient is responding inadequately to therapy or has developed a minor complication. Typically, 25 minutes are spent at the bedside and on the patient's hospital floor or unit);
  • 99226 (subsequent observation care, per day, for the evaluation and management of a patient, which requires at least two of these three key components: A detailed interval history; a detailed examination; medical decision making of high complexity. Counseling and coordination of care with other physicians, other qualified health care professionals, or agencies are provided consistent with the nature of the problem(s) and the patient's and family's needs. Usually, the patient is unstable or has developed a significant complication or a significant new problem. Typically, 35 minutes are spent at the bedside and on the patient's hospital floor or unit);
  • 99234 (observation or inpatient hospital care, for the evaluation and management of a patient including admission and discharge on the same date, which requires these three key components: A detailed or comprehensive history; a detailed or comprehensive examination; and medical decision making that is straightforward or of low complexity. Counseling and coordination of care with other physicians, other qualified health care professionals, or agencies are provided consistent with the nature of the problem(s) and the patient's and family's needs. Usually the presenting problem(s) requiring admission are of low severity. Typically, 40 minutes are spent at the bedside and on the patient's hospital floor or unit);
  • 99235 (observation or inpatient hospital care, for the evaluation and management of a patient including admission and discharge on the same date, which requires these three key components: A comprehensive history; a comprehensive examination; and medical decision making of moderate complexity. Counseling and coordination of care with other physicians, other qualified health care professionals, or agencies are provided consistent with the nature of the problem(s) and the patient's and family's needs. Usually the presenting problem(s) requiring admission are of moderate severity. Typically, 50 minutes are spent at the bedside and on the patient's hospital floor or unit);
  • 99236 (observation or inpatient hospital care, for the evaluation and management of a patient including admission and discharge on the same date, which requires these three key components: A comprehensive history; a comprehensive examination; and medical decision making of high complexity. Counseling and coordination of care with other physicians, other qualified health care professionals, or agencies are provided consistent with the nature of the problem(s) and the patient's and family's needs. Usually the presenting problem(s) requiring admission are of high severity. Typically, 55 minutes are spent at the bedside and on the patient's hospital floor or unit);

The request to add these observation services referenced various studies supporting the use of observation units. The studies indicated that observation units provide safe, cost effective care to patients that need ongoing evaluation and treatment beyond the emergency department visit by having reduced hospital admissions, shorter lengths of stay, increased safety and reduced cost. Additional studies cited indicated that observation units reduce the work load on emergency department physicians, and reduce emergency department overcrowding.

In the CY 2005 PFS proposed rule (69 FR 47510), we considered a request but did not propose to add the observation CPT codes 99217-99220 to the list of Medicare telehealth services on a category two basis for the reasons described in that rule. The most recent request did not include any information that would cause us to question the previous evaluation under the category one criterion, which has not changed, regarding the significant differences in patient acuity between these services and services on the telehealth list. (69 FR 66277) While the request included evidence of the general benefits of observation units, it did not include specific information demonstrating that the services described by these codes provided clinical benefit when furnished via telehealth, which is necessary for us to consider these codes on a category two basis. Therefore, we are not proposing to add these services to the list of approved telehealth services.Start Printed Page 46182

b. Emergency Department Visits: CPT Codes—

  • 99281 (emergency department visit for the evaluation and management of a patient, which requires these three key components: A problem focused history; a problem focused examination; and straightforward medical decision making. Counseling and coordination of care with other physicians, other qualified health care professionals, or agencies are provided consistent with the nature of the problem(s) and the patient's and family's needs. Usually, the presenting problem(s) are self-limited or minor);
  • 99282 (emergency department visit for the evaluation and management of a patient, which requires these three key components: An expanded problem focused history; an expanded problem focused examination; and medical decision making of low complexity. Counseling and coordination of care with other physicians, other qualified health care professionals, or agencies are provided consistent with the nature of the problem(s) and the patient's and family's needs. Usually, the presenting problem(s) are of low to moderate severity);
  • 99283 (emergency department visit for the evaluation and management of a patient, which requires these three key components: An expanded problem focused history; an expanded problem focused examination; and medical decision making of moderate complexity. Counseling and coordination of care with other physicians, other qualified health care professionals, or agencies are provided consistent with the nature of the problem(s) and the patient's and family's needs. Usually, the presenting problem(s) are of moderate severity);
  • 99284 (emergency department visit for the evaluation and management of a patient, which requires these three key components: A detailed history; a detailed examination; and medical decision making of moderate complexity. Counseling and coordination of care with other physicians, other qualified health care professionals, or agencies are provided consistent with the nature of the problem(s) and the patient's and family's needs. Usually, the presenting problem(s) are of high severity, and require urgent evaluation by the physician, or other qualified health care professionals but do not pose an immediate significant threat to life or physiologic function); and
  • 99285 (emergency department visit for the evaluation and management of a patient, which requires these three key components within the constraints imposed by the urgency of the patient's clinical condition and mental status: A comprehensive history; a comprehensive examination; and medical decision making of high complexity. Counseling and coordination of care with other physicians, other qualified health care professionals, or agencies are provided consistent with the nature of the problem(s) and the patient's and family's needs. Usually, the presenting problem(s) are of high severity and pose an immediate significant threat to life or physiologic function).

In the CY 2005 PFS proposed rule (69 FR 47510), we considered a request but did not propose to add the emergency department visit CPT codes 99281-99285 to the list of Medicare telehealth services for the reasons described in that rule.

The current request to add the emergency department E/M services stated that the codes are similar to outpatient visit codes (CPT codes 99201-99215) that have been on the telehealth list since CY 2002. As we noted in the CY 2005 PFS final rule, while the acuity of some patients in the emergency department might be the same as in a physician's office; we believe that, in general, more acutely ill patients are more likely to be seen in the emergency department, and that difference is part of the reason there are separate codes describing evaluation and management visits in the Emergency Department setting. The practice of emergency medicine often requires frequent and fast-paced patient reassessments, rapid physician interventions, and sometimes the continuous physician interaction with ancillary staff and consultants. This work is distinctly different from the pace, intensity, and acuity associated with visits that occur in the office or outpatient setting. Therefore, we are not proposing to add these services to the list of approved telehealth services on a category one basis.

The requester did not provide any studies supporting the clinical benefit of managing emergency department patients with telehealth which is necessary for us to consider these codes on a category two basis. Therefore, we are not proposing to add these services to the list of approved telehealth services on a category two basis.

Many requesters of additions to the telehealth list urged us to consider the potential value of telehealth for providing beneficiaries access to needed expertise. We note that if clinical guidance or advice is needed in the emergency department setting, a consultation may be requested from an appropriate source, including consultations that are currently included on the list of telehealth services.

c. Critical Care Evaluation and Management: CPT Codes—

  • 99291 (critical care, evaluation and management of the critically ill or critically injured patient; first 30-74 minutes); and 99292 (critical care, evaluation and management of the critically ill or critically injured patient; each additional 30 minutes (list separately in addition to code for primary service).

We previously considered and rejected adding these codes to the list of Medicare telehealth services in the CY 2009 PFS final rule (74 FR 69744) on a category 1 basis because, due to the acuity of critically ill patients, we did not believe critical care services are similar to any services on the current list of Medicare telehealth services. In that rule, we said that critical care services must be evaluated as category 2 services. Because we considered critical care services under category 2, we needed to evaluate whether these are services for which telehealth can be an adequate substitute for a face-to-face encounter, based on the category 2 criteria at the time of that request. We had no evidence suggesting that the use of telehealth could be a reasonable surrogate for the face-to-face delivery of this type of care.

The American Telemedicine Association (ATA) submitted a new request for CY 2016 that cited several studies to support adding these services on a category 2 basis. To qualify under category 2, we would need evidence that the service furnished via telehealth is still described accurately by the requested code and produces a clinical benefit for the patient via telehealth. However, in reviewing the information provided by the ATA and a study titled, “Impact of an Intensive Care Unit Telemedicine Program on Patient Outcomes in an Integrated Health Care System,” published July 2014 in JAMA Internal Medicine, which found no evidence that the implementation of ICU telemedicine significantly reduced mortality rates or hospital length of stay, which could be indicators of clinical benefit. Therefore, we stated that we do not believe that the submitted evidence demonstrates a clinical benefit to patients. Therefore, we did not propose to add these services on a category 2 basis to the list of Medicare telehealth services for CY 2016 (80 FR 71061).

This year, requesters cited additional studies to support adding critical care Start Printed Page 46183services on a category 2 basis. Eight of the studies dealt with telestroke and one with teleneurology. Telestroke is an approach that allows a neurologist to provide remote treatment to vascular stroke victims. Teleneurology offers consultations for neurological problems from a remote location. It may be initiated by a physician or a patient, for conditions such as headaches, dementia, strokes, multiple sclerosis and epilepsy.

However, according to the literature, the management of stroke via telehealth requires more than a single practitioner and is distinct from the work described by the E/M codes. One additional study cited involved pediatric patients, while another noted that the Department of Defense has used telehealth to provide critical care services to hospitals in Guam for many years. Another reference study indicated that consulting intensivists thought that telemedicine consultations were superior to telephone consultations. In all of these cases, we believe the evidence demonstrates that interaction between these patients and distant site practitioners can have clinical benefit. However, we do not agree that the kinds of services described in the study are those that are included in the critical care E/M codes. We note that CPT guidance makes clear that a variety of other services are bundled into the payment rates for critical care, including gastric intubations and vascular access procedures among others We do not believe these kinds of services are furnished via telehealth. Public comments, included cited studies, can be viewed at https://www.regulations.gov/​#!documentDetail;​D=​CMS-2015-0081-0002. Therefore, we are not proposing to add these services to the list of Medicare telehealth services for CY 2017.

However, we are persuaded by the requests that we recognize the potential benefit of critical care consultation services that are furnished remotely. We note that there are currently codes on the telehealth list that could be reported when consultation services are furnished to critically ill patients. But in consideration of these public requests, we recognize that there may be greater resource costs involved in furnishing these services relative to the existing telehealth consultation codes. We also agree with the requesters that there may be potential benefits of remote care by specialists for these patients. For these reasons, we think it would be advisable to create a coding distinction between telehealth consultations for critically ill patients relative to telehealth consultations for other hospital patients. Such a coding distinction would allow us to recognize the additional resource costs in terms of time and intensity involved in furnishing such services under the conditions where remote, intensive consultation is required to provide access to appropriate care for the critically ill patient. We recognize that the current set of codes may not adequately describe such services because current E/M coding presumes that the services are occurring in-person, in which case the expert care would be furnished in a manner described by the current codes for critical care.

Therefore, we are proposing to make payment through new codes, initial and subsequent, used to describe critical care consultations furnished via telehealth. This coding would provide a mechanism to report an intensive telehealth consultation service, initial or subsequent, for the critically ill patient under the circumstance when a qualified health care professional has in-person responsibility for the patient but the patient benefits from additional services from a distant-site consultant specially trained in providing critical care services. We propose limiting these services to once per day per patient. Like the other telehealth consultations, these services would be valued relative to existing E/M services (see Section II.L.2.b for proposed code valuations).

More details on the new coding (GTTT1 and GTTT2) and proposed valuation for these services are discussed in section II.L. of this proposed rule and the proposed RVUs for this service are included in Addendum B of this proposed rule. Like the other telehealth consultation codes, we are proposing that these services would be added to the telehealth list and would be subject to the geographic and other statutory restrictions that apply to telehealth services.

We request comment on this proposal, specifically as to whether the use of new coding would create a helpful distinction between telehealth consultations for critically ill patients relative to telehealth consultations for other hospital patients. We are also specifically interested in comments on how these services would be distinguished from existing critical care services and examples of different scenarios when each code would be appropriate. Such comments will help us to refine provider communication materials.

d. Psychological Testing: CPT Codes—

  • 96101 (psychological testing (includes psychodiagnostic assessment of emotionality, intellectual abilities, personality and psychopathology, e.g., MMPI, Rorschach, WAIS), per hour of the psychologist's or physician's time, both face-to-face time administering tests to the patient and time interpreting these test results and preparing the report);
  • 96102 psychological testing (includes psychodiagnostic assessment of emotionality, intellectual abilities, personality and psychopathology, e.g., MMPI and WAIS), with qualified health care professional interpretation and report, administered by technician, per hour of technician time, face-to-face);
  • 96118 Neuropsychological testing (e.g., Halstead-Reitan neuropsychological battery, Wechsler memory scales and Wisconsin card sorting test), per hour of the psychologist's or physician's time, both face-to-face time administering tests to the patient and time interpreting these test results and preparing the report); and,
  • 96119 Neuropsychological testing (e.g., Halstead-Reitan neuropsychological battery, Wechsler memory scales and Wisconsin card sorting test), with qualified health care professional interpretation and report, administered by technician, per hour of technician time, face-to-face).

Requesters indicated that there is nothing in the Minnesota Multiphasic Personality Inventory (MMPI), the Rorschach inkblot test, the Wechsler Adult Intelligence Scale (WAIS), the Halstead-Reitan Neuropsychological Battery and Allied Procedures, or the Wisconsin Card Sorting Test (WCST), that cannot be done via telehealth nor is different than neurological tests done for Parkinson's disease, seizure medication side effects, gait assessment, nor any of the many neurological examinations done via telehealth with the approved outpatient office visit and inpatient visit CPT codes currently on the telehealth list. As an example, requesters indicated that the MPPI is administered by a computer, which generates a report that is interpreted by the clinical psychologist, and that the test requires no interaction between the clinician and the patient.

We previously considered the request to add these codes to the Medicare telehealth list in the CY 2015 final rule (79 FR 67600). We decided not to add these codes, indicating that these services are not similar to other services on the telehealth list because they require close observation of how a patient responds. We noted that the requesters did not submit evidence supporting the clinical benefit of furnishing these services via telehealth so that we could evaluate them on a Start Printed Page 46184category 2 basis. While we acknowledge that requesters believe that some of these tests require minimal, if any, interaction between the clinician and patient, we disagree. We continue to believe that successful completion of the tests listed as examples in these codes require the clinical psychologist to closely observe the patient's response, which cannot be performed via telehealth. Some patient responses, for example, sweating and fine tremors, may be missed when the patient and examiner are not in the same room. Therefore, we are not proposing to add these services to the list of Medicare telehealth services for CY 2017.

e. Physical and Occupational Therapy and Speech-Language Pathology Services: CPT Codes—

  • 92507 (treatment of speech, language, voice, communication, and auditory processing disorder; individual); and, 92508 (treatment of speech, language, voice, communication, and auditory processing disorder; group, 2 or more individuals); 92521 (evaluation of speech fluency (e.g., stuttering, cluttering)); 92522 (evaluation of speech sound production (e.g., articulation, phonological process, apraxia, dysarthria)); 92523 (evaluation of speech sound production (e.g., articulation, phonological process, apraxia, dysarthria); with evaluation of language comprehension and expression (e.g., receptive and expressive language)); 92524 (behavioral and qualitative analysis of voice and resonance); (evaluation of oral and pharyngeal swallowing function); 92526 (treatment of swallowing dysfunction or oral function for feeding); 92610 (evaluation of oral and pharyngeal swallowing function); CPT codes 97001 (physical therapy evaluation); 97002 (physical therapy re-evaluation); 97003 (occupational therapy evaluation); 97004 (occupational therapy re-evaluation); 97110 (therapeutic procedure, 1 or more areas, each 15 minutes; therapeutic exercises to develop strength and endurance, range of motion and flexibility); 97112 (therapeutic procedure, 1 or more areas, each 15 minutes; neuromuscular reeducation of movement, balance, coordination, kinesthetic sense, posture, or proprioception for sitting or standing activities); 97116 (therapeutic procedure, 1 or more areas, each 15 minutes; gait training (includes stair climbing)); 97532 (development of cognitive skills to improve attention, memory, problem solving (includes compensatory training), direct (one-on-one) patient contact, each 15 minutes); 97533 (sensory integrative techniques to enhance sensory processing and promote adaptive responses to environmental demands, direct (one-on-one) patient contact, each 15 minutes); 97535 (self-care/home management training (e.g., activities of daily living (adl) and compensatory training, meal preparation, safety procedures, and instructions in use of assistive technology devices/adaptive equipment) direct one-on-one contact, each 15 minutes); 97537 (community/work reintegration training (e.g., shopping, transportation, money management, avocational activities or work environment/modification analysis, work task analysis, use of assistive technology device/adaptive equipment), direct one-on-one contact, each 15 minutes); 97542 (wheelchair management (e.g., assessment, fitting, training), each 15 minutes); 97750 (physical performance test or measurement (e.g., musculoskeletal, functional capacity), with written report, each 15 minutes); 97755 (assistive technology assessment (e.g., to restore, augment or compensate for existing function, optimize functional tasks and maximize environmental accessibility), direct one-on-one contact, with written report, each 15 minutes); 97760 Orthotic(s) management and training (including assessment and fitting when not otherwise reported), upper extremity(s), lower extremity(s) and/or trunk, each 15 minutes); 97761 (prosthetic training, upper and lower extremity(s), each 15 minutes); and 97762 (checkout for orthotic/prosthetic use, established patient, each 15 minutes).

The statute defines who is an authorized practitioner of telehealth services. Physical therapists, occupational therapists and speech-language pathologists are not authorized practitioners of telehealth under section 1834(m)(4)(E) of the Act, as defined in section 1842(b)(18)(C) of the Act. Because the above services are predominantly furnished by physical therapists, occupational therapists and speech-language pathologists, we do not believe it would be appropriate to add them to the list of telehealth services at this time. One requester suggested that we can add telehealth practitioners without legislation, as evidenced by the addition of nutritional professionals. However, we do not believe we have such authority and note that nutritional professionals are included as practitioners in the definition at section 1834(b)(18)(C)(vi) of the Act, and thus, are within the statutory definition of telehealth practitioners. Therefore, we are not proposing to add these services to the list of Medicare telehealth services for CY 2017.

In summary, we propose to add the following codes to the list of Medicare telehealth services beginning in CY 2017 on a category 1 basis:

  • ESRD-related services 90967 through 90970. The required clinical examination of the catheter access site must be furnished face-to-face “hands on” (without the use of an interactive telecommunications system) by a physician, CNS, NP, or PA.
  • Advance care planning (CPT codes 99497 and 99498).
  • Telehealth Consultations for a Patient Requiring Critical Care Services (GTTT1 and GTTT2)

We remind all interested stakeholders that we are currently soliciting public requests to add services to the list of Medicare telehealth services. To be considered during PFS rulemaking for CY 2018, these requests must be submitted and received by December 31, 2016. Each request to add a service to the list of Medicare telehealth services must include any supporting documentation the requester wishes us to consider as we review the request. For more information on submitting a request for an addition to the list of Medicare telehealth services, including where to mail these requests, we refer readers to the CMS Web site at https://www.cms.gov/​Medicare/​Medicare-General-Information/​Telehealth/​index.html.

4. Place of Service (POS) Code for Telehealth Services

CMS has received multiple requests from various stakeholders to establish a POS code to identify services furnished via telehealth. These requests have come from other payers, but may also be related to confusion concerning whether to use the POS where the distant site physician is located or the POS where the patient is located. The process for establishing POS codes, is managed by the POS Workgroup within CMS, is available for use by all payers, and is not contingent upon Medicare PFS rulemaking. However, if such a POS code were to be created, in order to make it valid for use in Medicare, we would have to determine the appropriate payment rules associated with the code. Therefore, we are proposing how a POS code for telehealth would be used under the PFS with the expectation that, if such a code is available, it would be used as early as January 1, 2017. We propose that the physicians or practitioners furnishing telehealth services would be required to report the telehealth POS code to Start Printed Page 46185indicate that the billed service is furnished as a telehealth service from a distant site.

Our proposed requirement for physicians and practitioners to use the telehealth POS code to report that telehealth services were furnished from a distant site would improve payment accuracy and consistency in telehealth claims submission. Currently, for services furnished via telehealth, we have instructed practitioners to report the POS code that would have been reported had the service been furnished in person. However, some practitioners use the POS where they are located when the service is furnished, while others use the POS corresponding to the patient's location.

Under the PFS, the POS code determines whether a service is paid using the facility or non-facility practice expense relative value units (PE RVUs). The facility rate is paid when a service is furnished in a location where Medicare is making a separate facility payment to an entity other than the physician or practitioner that is intended to reflect the facility costs associated with the service (clinical staff, supplies and equipment). We note that in accordance with section 1834(m)(2)(B) of the Act, the payment amount for the telehealth facility fee paid to the originating site is a national fee, paid without geographic or site of service adjustments that generally are made for payments to different kinds of Medicare providers and suppliers. In the case of telehealth services, we believe that facility costs (clinical staff, supplies, and equipment) associated with the provision of the service would generally be incurred by the originating site, where the patient is located, and not by the practitioner at the distant site. And, by statute, the Medicare pays a fee to the site that hosts the patient. This is analogous to the circumstances under which the facility PE RVUs are used to pay for services under the PFS. Therefore, we are proposing to use the facility PE RVUs to pay for telehealth services reported by physicians or practitioners with the telehealth POS code. We note that there are only three codes on the telehealth list with a difference greater than 1.0 PE RVUs between the facility PE RVUs and the non-facility PE RVUs. The remainder of the physician payments for telehealth services would be unchanged by this proposal. We do not anticipate that this proposal would result in a significant change in the total payment for the majority of services on the telehealth list. Moreover, many practitioners already use a facility POS when billing for telehealth services (those that report the POS of the originating site where the beneficiary is located). The proposed policy to use the telehealth POS code for telehealth services would not affect payment for telehealth services for these practitioners.

The POS code for telehealth would not apply to originating sites billing the facility fee. Originating sites are not furnishing a service via telehealth since the patient is physically present in the facility. Accordingly, the originating site would continue to use the POS code that applies to the type of facility where the patient is located.

We are also proposing a change to our regulation at § 414.22(b)(5)(i)(A) that addresses the PE RVUs used in different settings. These proposed revisions would improve clarity regarding our current and proposed policies. Specifically, we are proposing to amend this section to specify that the facility PE RVUs are paid for practitioner services furnished via telehealth under § 410.78. In addition, we are proposing a change to resolve any potential ambiguity and clarify that payment under the PFS is made at the facility rate (facility PE RVUs) when services are furnished in a hospital but for which the hospital is not being paid. Finally, to streamline the existing regulation, we are also proposing to delete § 414.32 of our regulation that refers to the calculating of payments for certain services prior to 2002.

This proposed change is aligned with regulatory changes being proposed in the “Medicare Program: Hospital Outpatient Prospective Payment and Ambulatory Surgical Center Payment Systems and Quality Reporting Programs; Organ Procurement Organization Reporting and Communication; Transplant Outcome Measures and Documentation Requirements; Electronic Health Record (EHR) Incentive Programs; Payment to Certain Off-Campus Provider-Based Departments” proposed rule to implement section 603 of the Bipartisan Budget Act of 2015. In that proposed rule, we discuss payment rates for services furnished to patients in off-campus provider-based departments.

D. Potentially Misvalued Services Under the Physician Fee Schedule

1. Background

Section 1848(c)(2)(B) of the Act directs the Secretary to conduct a periodic review, not less often than every 5 years, of the RVUs established under the PFS. Section 1848(c)(2)(K) of the Act requires the Secretary to periodically identify potentially misvalued services using certain criteria and to review and make appropriate adjustments to the relative values for those services. Section 1848(c)(2)(L) to the Act also requires the Secretary to develop a process to validate the RVUs of certain potentially misvalued codes under the PFS, using the same criteria used to identify potentially misvalued codes, and to make appropriate adjustments.

As discussed in section II.B. of this proposed rule, each year we develop appropriate adjustments to the RVUs taking into account recommendations provided by the American Medical Association/Specialty Society Relative Value Scale Update Committee (RUC), the Medicare Payment Advisory Commission (MedPAC), and others. For many years, the RUC has provided us with recommendations on the appropriate relative values for new, revised, and potentially misvalued PFS services. We review these recommendations on a code-by-code basis and consider these recommendations in conjunction with analyses of other data, such as claims data, to inform the decision-making process as authorized by the law. We may also consider analyses of work time, work RVUs, or direct PE inputs using other data sources, such as Department of Veteran Affairs (VA), National Surgical Quality Improvement Program (NSQIP), the Society for Thoracic Surgeons (STS), and the Physician Quality Reporting System (PQRS) databases. In addition to considering the most recently available data, we also assess the results of physician surveys and specialty recommendations submitted to us by the RUC for our review. We also consider information provided by other stakeholders. We conduct a review to assess the appropriate RVUs in the context of contemporary medical practice. We note that section 1848(c)(2)(A)(ii) of the Act authorizes the use of extrapolation and other techniques to determine the RVUs for physicians' services for which specific data are not available and requires us to take into account the results of consultations with organizations representing physicians who provide the services. In accordance with section 1848(c) of the Act, we determine and make appropriate adjustments to the RVUs.

In its March 2006 Report to the Congress (http://www.medpac.gov/​documents/​reports/​Mar06_​EntireReport.pdf?​sfvrsn=​0), MedPAC discussed the importance of appropriately valuing physicians' services, noting that misvalued services can distort the market for physicians' Start Printed Page 46186services, as well as for other health care services that physicians order, such as hospital services. In that same report MedPAC postulated that physicians' services under the PFS can become misvalued over time. MedPAC stated, “When a new service is added to the physician fee schedule, it may be assigned a relatively high value because of the time, technical skill, and psychological stress that are often required to furnish that service. Over time, the work required for certain services would be expected to decline as physicians become more familiar with the service and more efficient in furnishing it.” We believe services can also become overvalued when PE declines. This can happen when the costs of equipment and supplies fall, or when equipment is used more frequently than is estimated in the PE methodology, reducing its cost per use. Likewise, services can become undervalued when physician work increases or PE rises.

As MedPAC noted in its March 2009 Report to Congress (http://www.medpac.gov/​documents/​reports/​march-2009-report-to-congress-medicare-payment-policy.pdf?​sfvrsn=​0), in the intervening years since MedPAC made the initial recommendations, CMS and the RUC have taken several steps to improve the review process. Also, section 1848(c)(2)(K)(ii) of the Act augments our efforts by directing the Secretary to specifically examine, as determined appropriate, potentially misvalued services in the following categories:

  • Codes that have experienced the fastest growth.
  • Codes that have experienced substantial changes in practice expenses.
  • Codes that describe new technologies or services within an appropriate time period (such as 3 years) after the relative values are initially established for such codes.
  • Codes which are multiple codes that are frequently billed in conjunction with furnishing a single service.
  • Codes with low relative values, particularly those that are often billed multiple times for a single treatment.
  • Codes that have not been subject to review since implementation of the fee schedule.
  • Codes that account for the majority of spending under the physician fee schedule.
  • Codes for services that have experienced a substantial change in the hospital length of stay or procedure time.
  • Codes for which there may be a change in the typical site of service since the code was last valued.
  • Codes for which there is a significant difference in payment for the same service between different sites of service.
  • Codes for which there may be anomalies in relative values within a family of codes.
  • Codes for services where there may be efficiencies when a service is furnished at the same time as other services.
  • Codes with high intra-service work per unit of time.
  • Codes with high practice expense relative value units.
  • Codes with high cost supplies.
  • Codes as determined appropriate by the Secretary.

Section 1848(c)(2)(K)(iii) of the Act also specifies that the Secretary may use existing processes to receive recommendations on the review and appropriate adjustment of potentially misvalued services. In addition, the Secretary may conduct surveys, other data collection activities, studies, or other analyses, as the Secretary determines to be appropriate, to facilitate the review and appropriate adjustment of potentially misvalued services. This section also authorizes the use of analytic contractors to identify and analyze potentially misvalued codes, conduct surveys or collect data, and make recommendations on the review and appropriate adjustment of potentially misvalued services. Additionally, this section provides that the Secretary may coordinate the review and adjustment of any RVU with the periodic review described in section 1848(c)(2)(B) of the Act. Section 1848(c)(2)(K)(iii)(V) of the Act specifies that the Secretary may make appropriate coding revisions (including using existing processes for consideration of coding changes) that may include consolidation of individual services into bundled codes for payment under the physician fee schedule.

2. Progress in Identifying and Reviewing Potentially Misvalued Codes

To fulfill our statutory mandate, we have identified and reviewed numerous potentially misvalued codes as specified in section 1848(c)(2)(K)(ii) of the Act, and we plan to continue our work examining potentially misvalued codes in these areas over the upcoming years. As part of our current process, we identify potentially misvalued codes for review, and request recommendations from the RUC and other public commenters on revised work RVUs and direct PE inputs for those codes. The RUC, through its own processes, also identifies potentially misvalued codes for review. Through our public nomination process for potentially misvalued codes established in the CY 2012 PFS final rule with comment period, other individuals and stakeholder groups submit nominations for review of potentially misvalued codes as well.

Since CY 2009, as a part of the annual potentially misvalued code review and Five-Year Review process, we have reviewed over 1,671 potentially misvalued codes to refine work RVUs and direct PE inputs. We have assigned appropriate work RVUs and direct PE inputs for these services as a result of these reviews. A more detailed discussion of the extensive prior reviews of potentially misvalued codes is included in the CY 2012 PFS final rule with comment period (76 FR 73052 through 73055). In the CY 2012 PFS final rule with comment period, we finalized our policy to consolidate the review of physician work and PE at the same time (76 FR 73055 through 73958), and established a process for the annual public nomination of potentially misvalued services.

In the CY 2013 PFS final rule with comment period, we built upon the work we began in CY 2009 to review potentially misvalued codes that have not been reviewed since the implementation of the PFS (so-called “Harvard-valued codes”). In CY 2009, we requested recommendations from the RUC to aid in our review of Harvard-valued codes that had not yet been reviewed, focusing first on high-volume, low intensity codes (73 FR 38589). In the fourth Five-Year Review (76 FR 32410), we requested recommendations from the RUC to aid in our review of Harvard-valued codes with annual utilization of greater than 30,000. In the CY 2013 PFS final rule with comment period, we identified specific Harvard-valued services with annual allowed charges that total at least $10,000,000 as potentially misvalued. In addition to the Harvard-valued codes, in the CY 2013 PFS final rule with comment period we finalized for review a list of potentially misvalued codes that have stand-alone PE (codes with physician work and no listed work time and codes with no physician work that have listed work time).

In the CY 2016 PFS final rule with comment period, we finalized for review a list of potentially misvalued services, which included eight codes in the neurostimulators analysis-programming family (CPT 95970-95982). We also finalized as potentially misvalued 103 codes identified through Start Printed Page 46187our screen of high expenditure services across specialties.

3. Validating RVUs of Potentially Misvalued Codes

Section 1848(c)(2)(L) of the Act requires the Secretary to establish a formal process to validate RVUs under the PFS. The Act specifies that the validation process may include validation of work elements (such as time, mental effort and professional judgment, technical skill and physical effort, and stress due to risk) involved with furnishing a service and may include validation of the pre-, post-, and intra-service components of work. The Secretary is directed, as part of the validation, to validate a sampling of the work RVUs of codes identified through any of the 16 categories of potentially misvalued codes specified in section 1848(c)(2)(K)(ii) of the Act. Furthermore, the Secretary may conduct the validation using methods similar to those used to review potentially misvalued codes, including conducting surveys, other data collection activities, studies, or other analyses as the Secretary determines to be appropriate to facilitate the validation of RVUs of services.

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

We contracted with two outside entities to develop validation models for RVUs.

Given the central role of time in establishing work RVUs and the concerns that have been raised about the current time values used in rate setting, we contracted with the Urban Institute to develop empirical time estimates based on data collected from several health systems with multispecialty group practices. The Urban Institute collected data by directly observing the delivery of services and through the use of electronic health records for services selected by the contractor in consultation with CMS and is using this data to produce objective time estimates. We expect the final Urban Institute report will be made available on the CMS Web site later this summer.

The second contract is with the RAND Corporation, which used available data to build a validation model to predict work RVUs and the individual components of work RVUs, time and intensity. The model design was informed by the statistical methodologies and approach used to develop the initial work RVUs and to identify potentially misvalued procedures under current CMS and RUC processes. RAND consulted with a technical expert panel on model design issues and the test results. The RAND report is available under downloads on the Web site 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-Items/​CMS-1612-FC.html.

After posting RAND's report on the models and results on our Web site, we received comments indicating that the models did not adequately address global surgery services due to the lack of available data on included visits. Therefore, we modified the RAND contract to include the development of G-codes that could be used to collect data about post-surgical follow-up visits on Medicare claims to meet the requirements in section 1848(c)(8)(B) of the Act regarding collection of data on global services. Our proposals related to this data collection requirement are discussed in section II.D.6. Also, the data from this project would provide information that would allow the time for these services to be included in the model for validating RVUs.

4. CY 2017 Identification and Review of Potentially Misvalued Services

a. 0-day Global Services That Are Typically Billed With an Evaluation and Management (E/M) Service With Modifier 25

Because routine E/M is included in the valuation of codes with 0-, 10-, and 90-day global periods, Medicare only makes separate payment for E/M services that are provided in excess of those considered included in the global procedure. In such cases, the physician would report the additional E/M service with Modifier 25, which is defined as a significant, separately identifiable E/M service performed by the same physician on the day of a procedure above and beyond other services provided or beyond the usual preservice and postservice care associated with the procedure that was performed. Modifier 25 allows physicians to be paid for E/M services that would otherwise be denied as bundled.

In reviewing misvalued codes, both CMS and the RUC have often considered how frequently particular codes are reported with E/M codes to account for potential overlap in resources. Some stakeholders have expressed concern with this policy especially with regard to the valuation of 0-day global services that are typically billed with a separate E/M service with the use of Modifier 25. For example, when we established our valuation of the osteopathic manipulation services, described by CPT codes 98925-98929, we did so with the understanding that these codes are usually reported with E/M codes.

Medicare claims data for CY 2015 show that 19 percent of the codes that describe 0-day global services were billed over 50 percent of the time with an E/M with Modifier 25. Since routine E/M is included in the valuation of 0-day global services, we believe that the routine billing of separate E/M services may indicate a possible problem with the valuation of the bundle, which is intended to include all the routine care associated with the service.

We believe that reviewing the procedure codes typically billed with an E/M with Modifier 25 as potentially misvalued may be one avenue to improve valuation of these services. To develop the CY 2017 proposed list of potentially misvalued services in this category, we identified 0-day global codes billed with an E/M 50 percent of the time or more, on the same day of service, with the same physician and same beneficiary. To prioritize review of these potentially misvalued services, we are identifying the codes that have not been reviewed in the last 5 years, and with greater than 20,000 allowed services. Table 7 lists the 83 codes that meet these review criteria and we are proposing these as potentially misvalued for CY 2017. We request public input on additional ways to address appropriate valuations for all services that are typically billed with an E/M with Modifier 25.Start Printed Page 46188

Table 7—0-Day Global Services That Are Typically Billed With an Evaluation and Management (E/M) Service With Modifier 25

HCPCSLong descriptor
11000Removal of inflamed or infected skin, up to 10% of body surface.
11100Biopsy of single growth of skin or tissue.
11300Shaving of 0.5 centimeters or less skin growth of the trunk, arms, or legs.
11301Shaving of 0.6 centimeters to 1.0 centimeters skin growth of the trunk, arms, or legs.
11302Shaving of 1.1 to 2.0 centimeters skin growth of the trunk, arms, or legs.
11305Shaving of 0.5 centimeters or less skin growth of scalp, neck, hands, feet, or genitals.
11306Shaving of 0.6 centimeters to 1.0 centimeters skin growth of scalp, neck, hands, feet, or genitals.
11307Shaving of 1.1 to 2.0 centimeters skin growth of scalp, neck, hands, feet, or genitals.
11310Shaving of 0.5 centimeters or less skin growth of face, ears, eyelids, nose, lips, or mouth.
11311Shaving of 0.6 centimeters to 1.0 centimeters skin growth of face, ears, eyelids, nose, lips, or mouth.
11312Shaving of 1.1 to 2.0 centimeters skin growth of face, ears, eyelids, nose, lips, or mouth.
11740Removal of blood accumulation between nail and nail bed.
11755Biopsy of finger or toe nail.
11900Injection of up to 7 skin growths.
11901Injection of more than 7 skin growths.
12001Repair of wound (2.5 centimeters or less) of the scalp, neck, underarms, trunk, arms or legs.
12002Repair of wound (2.6 to 7.5 centimeters) of the scalp, neck, underarms, genitals, trunk, arms or legs.
12004Repair of wound (7.6 to 12.5 centimeters) of the scalp, neck, underarms, genitals, trunk, arms or legs.
12011Repair of wound (2.5 centimeters or less) of the face, ears, eyelids, nose, lips, or mucous membranes.
12013Repair of wound (2.6 to 5.0 centimeters) of the face, ears, eyelids, nose, lips, or mucous membranes.
17250Application of chemical agent to excessive wound tissue.
20526Injection of carpal tunnel.
20550Injections of tendon sheath, ligament, or muscle membrane.
20551Injections of tendon attachment to bone.
20552Injections of trigger points in 1 or 2 muscles.
20553Injections of trigger points in 3 or more muscles.
20600Aspiration or injection of small joint or joint capsule.
20604Arthrocentesis, aspiration or injection, small joint or bursa (e.g., fingers, toes); with ultrasound guidance, with permanent recording and reporting.
20605Aspiration or injection of medium joint or joint capsule.
20606Arthrocentesis, aspiration or injection, intermediate joint or bursa (e.g., temporomandibular, acromioclavicular, wrist, elbow or ankle, olecranon bursa); with ultrasound guidance, with permanent recording and reporting.
20610Aspiration or injection of large joint or joint capsule.
20611Arthrocentesis, aspiration or injection, major joint or bursa (e.g., shoulder, hip, knee, subacromial bursa); with ultrasound guidance, with permanent recording and reporting.
20612Aspiration or injection of cysts.
29105Application of long arm splint (shoulder to hand).
29125Application of non-moveable, short arm splint (forearm to hand).
29515Application of short leg splint (calf to foot).
29540Strapping of ankle or foot.
29550Strapping of toes.
30901Simple control of nose bleed.
30903Complex control of nose bleed.
31231Diagnostic examination of nasal passages using an endoscope.
31238Control of nasal bleeding using an endoscope.
31500Emergent insertion of breathing tube into windpipe cartilage using an endoscope.
31575Diagnostic examination of voice box using flexible endoscope.
31579Examination to assess movement of vocal cord flaps using an endoscope.
31645Aspiration of lung secretions from lung airways using an endoscope.
32551Removal of fluid from between lung and chest cavity, open procedure.
32554Removal of fluid from chest cavity.
40490Biopsy of lip.
43760Change of stomach feeding, accessed through the skin.
45300Diagnostic examination of rectum and large bowel using an endoscope.
46600Diagnostic examination of the anus using an endoscope.
51701Insertion of temporary bladder catheter.
51702Insertion of indwelling bladder catheter.
51703Insertion of indwelling bladder catheter.
56605Biopsy of external female genitals.
57150Irrigation of vagina or application of drug to treat infection.
57160Fitting and insertion of vaginal support device.
58100Biopsy of uterine lining.
64405Injection of anesthetic agent, greater occipital nerve.
64418Injection of anesthetic agent, collar bone nerve.
64455Injections of anesthetic or steroid drug into nerve of foot.
65205Removal of foreign body in external eye, conjunctiva.
65210Removal of foreign body in external eye, conjunctiva or sclera.
65222Removal of foreign body, external eye, cornea with slit lamp examination.
67515Injection of medication or substance into membrane covering eyeball.
67810Biopsy of eyelid.
67820Removal of eyelashes by forceps.
Start Printed Page 46189
68200Injection into conjunctiva.
69100Biopsy of ear.
69200Removal of foreign body from ear canal.
69210Removal of impact ear wax, one ear.
69220Removal of skin debris and drainage of mastoid cavity.
92511Examination of the nose and throat using an endoscope.
92941Insertion of stent, removal of plaque or balloon dilation of coronary vessel during heart attack, accessed through the skin.
92950Attempt to restart heart and lungs.
98925Osteopathic manipulative treatment to 1-2 body regions.
98926Osteopathic manipulative treatment to 3-4 body regions.
98927Osteopathic manipulative treatment to 5-6 body regions.
98928Osteopathic manipulative treatment to 7-8 body regions.
98929Osteopathic manipulative treatment to 9-10 body regions.
G0168Wound closure utilizing tissue adhesive(s) only.
G0268Removal of impacted cerumen (one or both ears) by physician on same date of service as audiologic function testing.

b. End-Stage Renal Disease Home Dialysis Services (CPT Codes 90963 Through 90970)

In the CY 2004 PFS final rule with comment period (68 FR 63216), we established new Level II HCPCS G-codes for end-stage renal disease (ESRD) services and established payment for those codes through monthly capitation payment (MCP) rates. For ESRD center-based patients, payment for the G-codes varied based on the age of the beneficiary and the number of face-to-face visits furnished each month (for example, 1 visit, 2-3 visits and 4 or more visits). We believed that many physicians would provide 4 or more visits to center-based ESRD patients and a small proportion will provide 2-3 visits or only one visit per month. Under the MCP methodology, to receive the highest payment, a physician would have to provide at least four ESRD-related visits per month. However, payment for home dialysis MCP services only varied by the age of beneficiary. Although we did not initially specify a frequency of required visits for home dialysis MCP services, we stated that we expect physicians to provide clinically appropriate care to manage the home dialysis patient.

The CPT Editorial Panel created new CPT codes to replace the G-codes for monthly ESRD-related services, and we accepted the new codes for use under the PFS in CY 2009. The CPT codes created were 90963-90966 for monthly ESRD-related services for home dialysis patient and CPT codes 90967-90970 for dialysis with less than a full month of services.

In a GAO report titled “END-STAGE RENAL DISEASE Medicare Payment Refinements Could Promote Increased Use of Home Dialysis” dated October 2015, http://www.gao.gov/​products/​GAO-16-125, the GAO stated that experts and stakeholders they interviewed indicated that home dialysis could be clinically appropriate for at least half of patients. Also, at a meeting in 2013, the chief medical officers of 14 dialysis facility chains jointly estimated that a realistic target for home dialysis would be 25 percent of dialysis patients. The GAO noted that CMS data showed that about 10 percent of adult Medicare dialysis patients use home dialysis as of March 2015.

In the report, the GAO noted that CMS intended for the existing payment structure to create an incentive for physicians to prescribe home dialysis, because the monthly payment rate for managing the dialysis care of home patients, which requires a single in-person visit, was approximately equal to the rate for managing and providing two to three visits to ESRD center-based patients. However, GAO found that, in 2013, the rate of $237 for managing home patients was lower than the average payment of $266 and maximum payment of $282 for managing ESRD center-based patients. The GAO stated that this difference in payment rates may discourage physicians from prescribing home dialysis.

Physician associations and other physicians GAO interviewed stated that the visits with home patients are often longer and more comprehensive than in-center visits; this is in part because physicians may conduct visits with individual home patients in a private setting, but they may be able to more easily visit multiple in-center patients on a single day as they receive dialysis. The physician associations GAO interviewed also said that they may spend a similar amount of time outside of visits to manage the care of home patients and that they are required to provide at least one visit per month to perform a complete assessment of the patient.

It is important to note that, as stated in the CY 2011 PFS final rule with comment period (75 FR 73296), we believe that furnishing monthly face-to-face visits is an important component of high quality medical care for ESRD patients being dialyzed at home and generally would be consistent with the current standards of medical practice. However, we also acknowledged that extenuating circumstances may arise that make it difficult for the MCP physician (or NPP) to furnish a visit to a home dialysis patient every month. Therefore, we allow Medicare contractors the discretion to waive the requirement for a monthly face-to-face visit for the home dialysis MCP service on a case-by-case basis, for example, when the MCP physician's (or NPP's) notes indicate that the MCP physician (or NPP) actively and adequately managed the care of the home dialysis patient throughout the month.

The GAO recommended, and we agreed, that CMS examine Medicare policies for monthly payments to physicians to manage the care of dialysis patients and revise them if necessary to ensure that these policies are consistent with our goal of encouraging the use of home dialysis among patients for whom it is appropriate. Therefore, we are proposing to identify CPT codes 90963 through 90970 as potentially misvalued codes based on the volume of claims submitted for these services relative to those submitted for facility ESRD services.Start Printed Page 46190

c. Direct PE Input Discrepancies

i. Appropriate Direct PE Inputs Involved in Procedures Involving Endoscopes

Stakeholders have raised concerns about potential inconsistencies with the inputs and the prices related to endoscopic procedures in the direct PE database. Upon review, we noted that there are 45 different pieces of endoscope related-equipment and 25 different pieces of endoscope related-supplies that are currently associated with these services. Relative to other kinds of equipment items in the direct PE input, these items are much more varied and used for many fewer services. Given the frequency with which individual codes can be reviewed and the importance of standardizing inputs for purposes of maintaining relativity across PFS services, we believe that this unusual degree of variation is likely to result in code misvaluation. To facilitate efficient review of this particular kind of misvaluation, and because we believe that stakeholders will prefer the opportunity to contribute to such standardization, we request that stakeholders like the RUC review and make recommendations on the appropriate endoscopic equipment and supplies typically provided in all endoscopic procedures for each anatomical body region, along with their appropriate prices.

ii. Appropriate Direct PE Inputs in the Facility Post-Service Period When Post-Operative Visits Are Excluded

We identified a potential inconsistency in instances where there are direct PE inputs included in the facility postservice period even though post-operative visit is not included in a service. We identified 13 codes that are affected by this issue and we are unclear if the discrepancy is caused by inaccurate direct PE inputs or inaccurate post-operative data in the work time file. We request that stakeholders including the RUC review these discrepancies and provide their recommendations on the appropriate direct PE inputs for the codes listed in Table 8.

Table 8—Codes That Have Direct PE Inputs in the Facility Postservice Period When Post-Operative Visits Are Excluded

CPT CodeLong descriptor
21077Impression and preparation of eye socket prosthesis.
21079Impression and custom preparation of temporary oral prosthesis.
21080Impression and custom preparation of permanent oral prosthesis.
21081Impression and custom preparation of lower jaw bone prosthesis.
21082Impression and custom preparation of prosthesis for roof of mouth enlargement.
21083Impression and custom preparation of roof of mouth prosthesis.
21084Impression and custom preparation of speech aid prosthesis.
28636Insertion of hardware to foot bone dislocation with manipulation, accessed through the skin.
28666Insertion of hardware to toe joint dislocation with manipulation, accessed through the skin.
43652Incision of vagus nerves of stomach using an endoscope.
46900Chemical destruction of anal growths.
47570Connection of gall bladder to bowel using an endoscope.
66986Exchange of lens prosthesis.

d. Insertion and Removal of Drug Delivery Implants—CPT Codes 11981 and 11983

Stakeholders have urged CMS to create new coding describing the insertion and removal of drug delivery implants for buprenorphine hydrochloride, formulated as a 4 rod, 80 mg, long acting subdermal drug implant for the treatment of opioid addiction. These stakeholders have suggested that current coding that describes insertion and removal of drug delivery implants is too broad and that new coding is needed to account for specific additional resource costs associated with particular treatment. We are identifying existing CPT codes 11981 (Insertion, non-biodegradable drug delivery implant), 11982 (Removal, non-biodegradable drug delivery implant), and 11983 (Removal with reinsertion, non-biodegradable drug delivery implant) as potentially misvalued codes and are seeking comment and information regarding whether the current resource inputs in work and practice expense for these codes appropriately account for variations in the service relative to which devices and related drugs are inserted and removed.

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

The CPT manual identifies 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. In developing RVUs for these services, we include the resource costs associated with moderate sedation in the valuation since the CPT codes include moderate sedation as an inherent part of the procedure. Therefore, only the procedure code is currently reported when furnishing the service. Endoscopic procedures constitute a significant portion of the services identified in Appendix G. In the CY 2015 PFS proposed rule (79 FR 40349), we noted that it appeared that practice patterns for endoscopic procedures were changing, with anesthesia increasingly being separately reported for these procedures, meaning that the resource costs associated with sedation were no longer incurred by the practitioner reporting the Appendix G procedure. We indicated that, in order to reflect apparent changes in medical practice, we were considering establishing a uniform approach to the appropriate valuation of all Appendix G services for which moderate sedation is no longer inherent, rather than addressing the issue at the procedure level as individual codes are revalued. We solicited public comment on approaches to the appropriate valuation of these services.

In the CY 2016 PFS proposed rule (80 FR 41707), we again solicited public comment and recommendations on approaches to address the appropriate valuation of moderate sedation related to Appendix G services. In response to our comment solicitation, the CPT Editorial Panel created CPT codes for separately reporting moderate sedation services in association with the elimination of Appendix G from the CPT Manual for CY 2017. This coding change would provide for payment for Start Printed Page 46191moderate sedation services only in cases where it is furnished. In addition to providing recommended values for the new codes used to separately report moderate sedation, the RUC has also provided a methodology for revaluing all services previously identified in Appendix G, without moderate sedation, in order to make appropriate corresponding adjustments for the procedural services. The RUC recommended this methodology to address moderate sedation valuation generally instead of recommending that it be addressed as individual codes are reviewed. The RUC's recommended methodology would remove work RVUs for moderate sedation from Appendix G codes based on a code-level assessment of whether the procedures are typically performed on straightforward patients or more difficult patients. Based on its recommended methodology, the RUC is recommending removal of fewer RVUs from each of the procedural services than it recommends for valuing the moderate sedation services. If we were to use the RUC-recommended values for both the moderate sedation codes and the Appendix G procedural codes without refinement, overall payments for these procedures, when moderate sedation is furnished, would increase relative to the current payment.

We direct readers to section II.L. of this proposed rule, which includes more details regarding our proposed valuation of the new moderate sedation codes and our proposed uniform methodology for revaluation of the procedural codes previously identified in Appendix G. We believe that the RVUs assigned under the PFS should reflect the overall resource costs of PFS services, regardless of how many codes are used to report the services. Therefore, our proposed methodology for valuation of Appendix G procedural services would maintain current resource assumptions for the procedures when furnished with moderate sedation and redistribute the RVUs associated with moderate sedation (previously included in Appendix G procedural codes) to other PFS services. We believe that our proposed uniform methodology for revaluation of Appendix G services without moderate sedation is consistent with our general principle that the overall resource costs for the procedures do not change based solely on changes in coding.

We also note that stakeholders presented information to CMS regarding specialty group survey data for physician work. The stakeholders shared survey results for physician work involved in furnishing moderate sedation that demonstrated a significant bimodal distribution between procedural services furnished by gastroenterologists (GI) and procedural services furnished by other specialties. Since we believe that gastroenterologists furnish the highest volume of services previously identified in Appendix G, and services primarily furnished by gastroenterologists prompted the concerns that led to our identification of changes in medical practice and potentially duplicative payment for these codes, we have addressed the variations between the GI and other specialties in our review of the new moderate sedation CPT codes and their recommended values. We again direct readers to section II.L. of this proposed rule where we discuss our proposal to augment the new CPT codes for moderate sedation with an endoscopy-specific moderate sedation code, as well as proposed valuations reflecting the differences in the physician survey data between GI and other specialties.

6. Collecting Data on Resources Used in Furnishing Global Services

a. Background

(1) Current Payment Policy for Global Packages

Under the PFS, certain services, such as surgery, are valued and paid for as part of global packages that include the procedure and the services typically furnished in the periods immediately before and after the procedure. For each of these global packages, we establish a single PFS payment that includes payment for particular services that we assume to be typically furnished during the established global period. There are three primary categories of global packages that are labeled based on the number of post-operative days included in the global period: 0-day; 10-day; and 90-day. The 0-day global packages include the surgical procedure and the pre-operative and post-operative services furnished by the physician on the day of the service. The 10-day global packages include these services and, in addition, visits related to the procedure during the 10 days following the day of the procedure. The 90-day global packages include the same services as the 0-day global codes plus the pre-operative services furnished one day prior to the procedure and post-operative services during the 90 days immediately following the day of the procedure. Section 40.1 of Chapter 12 of the Claims Processing Manual (Pub. 100-04) defines the global surgical package to include the following services related to the surgery when furnished during the global period by the same physician or another practitioner in the same group practice:

  • Pre-operative Visits: Pre-operative visits after the decision is made to operate beginning with the day before the day of surgery for major procedures and the day of surgery for minor procedures;
  • Intra-operative Services: Intra-operative services that are normally a usual and necessary part of a surgical procedure;
  • Complications Following Surgery: All additional medical or surgical services required of the surgeon during the post-operative period of the surgery because of complications that do not require additional trips to the operating room;
  • Post-operative Visits: Follow-up visits during the post-operative period of the surgery that are related to recovery from the surgery;
  • Post-surgical Pain Management: By the surgeon;
  • Supplies: Except for those identified as exclusions; and
  • Miscellaneous Services: Items such as dressing changes; local incisional care; removal of operative pack; removal of cutaneous sutures and staples, lines, wires, tubes, drains, casts, and splints; insertion, irrigation and removal of urinary catheters, routine peripheral intravenous lines, nasogastric and rectal tubes; and changes and removal of tracheostomy tubes.

In the CY 2015 PFS proposed and final rules we extensively discussed the problems with accurate valuation of 10-and 90-day global packages. Our concerns included the fact that we do not use actual data on services furnished in order to update the rates, questions regarding the accuracy of our current assumptions about typical services, whether we will be able to adjust values on a regular basis to reflect changes in the practice of medicine and health care delivery, and how our global payment policies affect what services are actually furnished (79 FR 67582 through 67585). In finalizing a policy to transform all 10-day and 90-day global codes to 0-day global codes in CY 2017 and CY 2018, respectively, to improve the accuracy of valuation and payment for the various components of global packages, including pre- and post-operative visits and the procedure itself, we stated that we were adopting this policy because we believe it is critical that PFS payment rates be based upon RVUs that reflect the resource costs of furnishing the services. We also stated our belief that transforming all 10- and 90-day global codes to 0-day global packages would:Start Printed Page 46192

  • Increase the accuracy of PFS payment by setting payment rates for individual services that more closely reflect the typical resources used in furnishing the procedures;
  • Avoid potentially duplicative or unwarranted payments when a beneficiary receives post-operative 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 post-operative physicians' services in the 0-day global packages; and
  • Facilitate the availability of more accurate data for new payment models and quality research.

(2) Data Collection and Revaluation of Global Packages Required by MACRA

Section 523(a) of the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) (Pub. L. 114-10, enacted April 16, 2015) prohibits the Secretary from implementing the policy, described above, that would have transformed all 10-day and 90-day global surgery packages to 0-day global packages.

Section 1848(c)(8)(B) of the Act, which was also added by section 523(a) of the MACRA, requires us to collect data to value surgical services. Section 1848(c)(8)(B)(i) of the Act requires us 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 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 and furnished during the global period, 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 reassess the value of this collected information; and allows us to discontinue the collection of this information if the Secretary determines that we have adequate information from other sources to accurately value global surgical services. Section 1848(c)(8)(B)(iii) of the Act specifies that the Inspector General shall audit a sample of the collected information to verify its accuracy. Section 1848(c)(9) of the Act (added by section 523(b) of the MACRA) 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.

Section 1848(c)(8)(C) of the Act, which was also added by section 523(a) of the MACRA, 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.

(3) Public Input

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 the CY 2015 PFS final rule (79 FR 67582 through 67591) the limitations and difficulties involved in the appropriate valuation of the global packages, especially when the resources and the related values assigned to the component services are not defined. To gain input from stakeholders on implementation of this data collection, we sought comment on various aspects of this task in the CY 2016 proposed rule (80 FR 41707 through 41708). We solicited comments from the public regarding the kinds of auditable, objective data (including the number and type of visits and other services furnished during the post-operative period by the practitioner furnishing the procedure) 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 post-operative 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 potential methods of valuing the individual components of the global surgical package. A large number of comments expressed strong support for our proposal to hold an open door forum or town hall meetings with the public. Toward this end, we held a national listening session on January 20, 2016. Prior to the listening session, the topics for which guidance was being sought were sent electronically to those who registered for the session and made available on our Web site. The topics were:

  • Mechanisms for capturing the types of services typically furnished during the global period.
  • Determining the representative sample for the claims-based data collection.
  • Determining whether we should collect data on all surgical services or, if not, which services should be sampled.
  • Potential for designing data collection elements to interface with existing infrastructure used to track follow-up visits within the global period.
  • Consideration of use of 5 percent withhold until required information is furnished.

The 658 participants in the national listening session provided valuable information on this task. A written transcript and an audio recording of this session are available at https://www.cms.gov/​Outreach-and-Education/​Outreach/​NPC/​National-Provider-Calls-and-Events-Items/​2016-01-20-MACRA.html.

We considered both the comments submitted on the CY 2016 PFS proposed rule and the input provided at the listening session as we developed this proposal for data collection. When relevant, we discuss this stakeholder input below without distinguishing between comments on the proposed rule and input provided at the national listening session.

b. Data Collection Required To Accurately Value Global Packages

Resource-based valuation of individual physicians' services is a critical foundation for Medicare payment to physicians. It is essential 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 to make appropriate payment and preserve relativity among services. For global surgical packages, this requires using objective data on all of the resources used to furnish the services that are included in the package. Not having such data for some components may significantly skew relativity and create unwarranted payment disparities within the PFS.

The current valuations for many services valued as global packages are based upon the total package as a unit rather than by determining the resources used in furnishing the procedure and each additional service/visit and summing the results. As a result, we do not have the same level of information about the components of global packages as we do for other services. To value global packages accurately and Start Printed Page 46193relative to other procedures, we need accurate information about the resources—work, PEs and malpractice—used in furnishing the procedure, similar to what is used to determine RVUs for all services. In addition we need the same information on the post-operative services furnished in the global period (and pre-operative services the day before for 90-day global packages). Public comments about our proposal to value all global services as 0-day global services and pay separately for additional post-operative services when furnished indicated that there were no reliable data available on the value of the underlying procedure that did not also incorporate the value of the post-operative services, reinforcing our view that more data are needed across the board.

While we believe that most of the services furnished in the global period are visits for follow-up care, we do not have accurate information on the number and level of visits typically furnished because those billing for global services are not required to submit claims for post-operative visits. A May 2012 Office of Inspector General (OIG) report, entitled Cardiovascular Global Surgery Fees Often Did Not Reflect the Number of Evaluation and Management Services Provided (http://oig.hhs.gov/​oas/​reports/​region5/​50900054.pdf) found that for 202 of the 300 sampled cardiovascular global surgeries, the Medicare payment rates were based on a number of visits that did not reflect the actual number of services provided. Specifically, physicians provided fewer services than the visits included in the payment calculation for 132 global surgery services and provided more services than were included in the payment calculations for 70 services. Similar results were found in OIG reports entitled “Musculoskeletal Global Surgery Fees Often Did Not Reflect The Number Of Evaluation And Management Services Provided” (http://oig.hhs.gov/​oas/​reports/​region5/​50900053.asp) and “Review of Cataract Global Surgeries and Related Evaluation and Management Services, Wisconsin Physicians Service Insurance Corporation Calendar Year 2003, March 2007” (http://oig.hhs.gov/​oas/​reports/​region5/​50600040.pdf).

Claims data plays a major role in PFS rate-setting. Specifically, Medicare claims data is a primary driver in the allocation of indirect PE RVUs and MP RVUs across the codes used by particular specialties, and in making overall budget neutrality and relativity adjustments. In most cases, a claim must be filed for all visits. Such claims provide information such as the place of service, the type and, if relevant, the level of the service, the date of the service, and the specialty of the practitioner furnishing the services. Because we have not required claims reporting of visits included in global surgical packages, we do not have any of this information for the services bundled in the package.

In addition to the lack of information about the number and level of visits actually furnished, the current global valuations rely on crosswalks to E/M visits, based upon the assumption that the resources, including work, used in furnishing pre- and post-operative visits are similar to those used in furnishing E/M visits. We are unaware of any studies or surveys that verify this assertion. Although we generally value global packages using the same direct PE inputs as are used for the E/M services, for services for which the RUC recommendations include specific PE inputs in addition to those typically included for E/M services, we generally use the additional inputs in the global package valuation. Of note, when a visit included in a global package would use fewer resources than a comparable E/M service, the RUC generally does not include recommendations to decrease the PE inputs of the visit included in the global package, and we have not generally made comparable reductions. Another inconsistency with our current global package valuation approach is that even though we effectively assume that the E/M codes are appropriate for valuing pre- and post-operative services, the indirect PE inputs used for calculating payments for global services are based upon the specialty mix furnishing the global service, not the specialty mix of the physicians furnishing the E/M services, resulting in a different valuation for the E/M services contained in global packages than for separately billable E/M services. There is a critical need to obtain complete information if we are to value global packages accurately and in a way that preserves relativity across the fee schedule.

To meet the requirement under section 1848(c)(8)(B)(i) of the Act, we develop, through rulemaking, a process to gather information needed to value surgical services. Therefore, we are proposing a rigorous data collection effort that we believe would provide us the data needed to accurately value the 4,200 codes with a 10- or 90-day global period. Using our authority under sections 1848(c)(2)(M) and (c)(8)(B)(i) of the Act, we propose to gather the data needed to determine how to best structure global packages with post-operative care that is typically delivered days, weeks or months after the procedure and whether there are some procedures for which accurate valuation for packaged post-operative care is not possible. Finally, we believe these data would provide useful information to assess the resources used in furnishing pre- and post-operative care. To accurately do so, we need to know the volume and costs of the resources typically used. Although it may not be possible to gather all the necessary data and to complete the analysis required to re-value all of the codes currently valued as 10- or 90-day global packages by January 1, 2019, we believe the proposed data collection would provide the foundation for such valuations and would allow us to re-value, as appropriate, the surgical services on a flow basis, starting in rulemaking for CY 2019.

We are proposing a three-pronged approach to collect timely and accurate data on the frequency of, and inputs involved in furnishing, global services including the procedure and the pre-operative visits, post-operative visits, and other services for which payment is included in the global surgical payment. By analyzing these data, we would not only have the most comprehensive information available on the resources used in furnishing these services, but also would be able to determine the appropriate packages for such services. Specifically, the effort would include:

  • Comprehensive claims-based reporting about the number and level of pre- and post-operative visits furnished for 10- and 90-day global services.
  • A survey of a representative sample of practitioners about the activities involved in and the resources used in providing a number of pre- and post-operative visits during a specified, recent period of time, such as two weeks.
  • A more in-depth study, including direct observation of the pre- and post-operative care delivered in a small number of sites, including some ACOs.

This work is critical to understanding and characterizing the work and other resources involved in furnishing services throughout the current global periods assigned to specific surgical procedures. The information collected and analyzed through the activities would be the first comprehensive look at the volume and level of services in a global period, and the activities and inputs involved in furnishing global services. The data from these activities would ultimately inform our revaluation of global surgical packages.Start Printed Page 46194

(1) Statutory Authority for Data Collection

As described above, section 1848(c)(8)(B)(i) of the Act requires us to develop, through rulemaking, a process to gather information needed to value surgical services from a representative sample of physicians. The statute requires that the collected information include the number and level of medical visits furnished during the global period and other items and services related to the surgery and furnished during the global period, as appropriate.

In addition, section 1848(c)(2)(M) of the Act, which was added to the Act by section 220 of the PAMA, authorizes the Secretary to collect or obtain information on resources directly or indirectly related to furnishing services for which payment is made under the PFS. Such information may be collected or obtained from any eligible professional or any other source. Information may be collected or obtained from surveys of physicians, other suppliers, providers of services, manufacturers, and vendors. That section also authorizes the Secretary to collect information through any other mechanism determined appropriate. When using information gathered under this authority, the statute requires the Secretary to disclose the information source and discuss the use of such information in the determination of relative values through notice and comment rulemaking.

As described above, to gain all the information that is needed to determine the appropriate packages for global services and to revalue those services, we need to conduct a comprehensive study on the resources used in furnishing such services. Through such a study, we would have much more robust data to use in valuation than has been typically available. We anticipate that such efforts would inform how to more regularly collect data on the resources used in furnishing physicians' services. To the extent that such mechanisms prove valuable, they may be used to collect data for valuing other services. To achieve this significant data collection, we are proposing to collect data under the authority of both section 1848(c)(8)(B) and (c)(2)(M) of the Act.

(2) Claims-Based Data Collection

This section describes our proposal for claims-based data collection that would be applicable to 10- and 90-day global services furnished on or after January 1, 2017, including who would be required to report, what they would be required to report, and how reports would be submitted.

(a) Information To Be Reported

A key element of claims-based reporting is using codes that appropriately reflect the services furnished. In response to the comment solicitation in the CY 2016 PFS proposed rule and in the January 2016 listening session, we received numerous recommendations for the information to be reported on claims. The most frequently recommended approach was for practitioners to report the existing CPT code for follow-up visits included in the surgical package (CPT 99024—Postoperative follow-up visit, normally included in the surgical package, to indicate that an E/M service was performed during a postoperative period for a reason(s) related to the original procedure). Others suggested using this code for outpatient visits and using length of stay data for estimating the number of inpatient visits during the global period. In response to our concerns that CPT code 99024 would provide only the number of visits and not the level of visits as required by the statute, one commenter suggested using modifiers in conjunction with CPT code 99024 to indicate the level of the visit furnished. Others recommended using existing CPT codes for E/M visits to report post-operative care. One commenter suggested that CMS analyze data from a sample of large systems and practices that are using electronic health records that require entry of some CPT code for every visit to capture the number of post-operative visits. After noting that the documentation requirements and PEs required for post-operative visits differ from those of E/M visits outside the global period, one commenter encouraged us to develop a separate series of codes to capture the work of the post-operative services and to measure, not just estimate, the number and complexity of visits during the global period.

Other commenters opposed the use of a new set of codes or the use of modifiers to report post-operative visits. Commenters also noted several issues for us to consider in developing data collection mechanisms, including that many post-operative services do not have CPT codes to bill separately, that surgeons perform a wide range of collaborative care services, and that patient factors, including disease severity and comorbidities, influence what post-operative care is furnished.

To assist us in determining appropriate coding for claims-based reporting, we added a task to the RAND contract for developing a model to validate the RVUs in the PFS, which was awarded in response to a requirement in the Affordable Care Act. Comments that we received on RAND's report suggested the models did not adequately address global surgery services due to the lack of available data on included visits. Therefore, we modified the RAND contract to include the development of G-codes that could be used to collect data about post-surgical follow-up visits on Medicare claims for valuing global services under MACRA and so that this time could be included in the model for validating RVUs.

To inform its work, RAND conducted interviews with surgeons and other physicians/non-physician practitioners (NPP) who provide post-operative care. A technical expert panel (TEP), convened by RAND, reviewed the findings of the interviews and provided input on how to best capture care provided in the post-operative period on claims.

In summarizing the input from the interviews and the TEP, RAND indicated that several considerations were important in developing a claims-based method for capturing post-operative services. First, a simple system to facilitate reporting was needed. Since it was reported that a majority of post-operative visits are straightforward, RAND found that a key for any proposed system is identifying the smaller number of complex post-operative visits. Another consideration for RAND was not using the existing CPT E/M structure to capture postoperative care because of concerns that E/M codes are inadequately designed to capture the full scope of post-operative care and that using such codes might create confusion. Another consideration was that the TEP was most enthusiastic about a set of codes that used site of care, time, and complexity to report visits. RAND also believed it was important to distinguish—particularly in the inpatient setting—between circumstances where a surgeon is providing primary versus secondary management of a patient. Finally, a mechanism for reporting the postoperative care occurs outside of in-person visits and by clinical staff was needed. RAND noted that in the inpatient setting in particular, surgeons spend considerable time reviewing test results and coordinating care with other practitioners.

After reviewing various approaches, RAND recommended a set of time-based, post-operative visit codes that could be used for reporting care provided during the post-operative period.Start Printed Page 46195

The recommended codes are distinguished by the setting of care and whether they are furnished by a physician/NPP or by clinical staff. All codes are intended to be reported in 10-minute increments. A copy of the report is available available on the CMS Web site under downloads for the CY 2017 PFS proposed rule with comment period at http://www.cms.gov/​physicianfeesched/​downloads/​.

Based upon the work done by RAND, we are proposing the following codes be used for reporting on claims the services actually furnished but not paid separately because they are part of global packages. No separate payment would be made for these codes.

TABLE 9—Proposed Global Service Codes

InpatientGXXX1Inpatient visit, typical, per 10 minutes, included in surgical package.
GXXX2Inpatient visit, complex, per 10 minutes, included in surgical package.
GXXX3Inpatient visit, critical illness, per 10 minutes, included in surgical package.
Office or Other OutpatientGXXX4Office or other outpatient visit, clinical staff, per 10 minutes, included in surgical package.
GXXX5Office or other outpatient visit, typical, per 10 minutes, included in surgical package.
GXXX6Office or other outpatient visit, complex, per 10 minutes, included in surgical package.
Via Phone or InternetGXXX7Patient interactions via electronic means by physician/NPP, per 10 minutes, included in surgical package.
GXXX8Patient interactions via electronic means by clinical staff, per 10 minutes, included in surgical package.

(i) Coding for Inpatient Global Service Visits

Our coding proposal includes three codes for reporting inpatient pre- and post-operative visits that distinguish the intensity involved in furnishing the services. The typical inpatient visit would be reported using HCPCS code GXXX1, Inpatient visit, typical, per 10 minutes, included in surgical package. The activities listed in Table 10 are those that RAND recommended to be reported as a typical visit. Under our proposal, visits that involve any combination or number of the services listed in Table 10 would be reported using GXXX1. Based on the findings from the interviews and the TEP, RAND reports that the vast majority of inpatient post-operative visits would be expected to be reported using GXXX1.

Table 10—Activities Included in Typical Visit (GXXX1 & GXXX5)

Review vitals, laboratory or pathology results, imaging, progress notes
Take interim patient history and evaluate post-operative progress
Assess bowel function
Conduct patient examination with a specific focus on incisions and wounds, post-surgical pain, complications, fluid and diet intake
Manage medications (for example, wean pain medications)
Remove stitches, sutures, and staples
Change dressings
Counsel patient and family in person or via phone
Write progress notes, post-operative orders, prescriptions, and discharge summary
Contact/coordinate care with referring physician or other clinical staff
Complete forms or other paperwork

Inpatient pre- and post-operative visits that are more complex than typical visits but do not qualify as critical illness visits would be coded using GXXX2 (Inpatient visit, complex, per 10 minutes, included in surgical package). To report this code, the practitioner would be required to furnish services beyond those included in a typical visit and have documentation that indicates what services were provided that exceeded those included in a typical visit. Some circumstances that might merit the use of the complex visit code are secondary management of a critically ill patient where another provider such as an intensivist is providing the primary management, primary management of a particularly complex patient such as a patient with numerous comorbidities or high likelihood of significant decline or death, management of a significant complication, or complex procedures outside of the operating room (For example, significant debridement at the bedside).

The highest level of inpatient pre- and post-operative visits, critical illness visits (GXXX3—Inpatient visit, critical illness, per 10 minutes, included in surgical package) would be reported when the physician is providing primary management of the patient at a level of care that would be reported using critical care codes if it occurred outside of the global period. This involves acute impairment of one or more vital organ systems such that there is a high probability of imminent or life threatening deterioration in the patient's condition.

Similar to how time is now counted for the existing CPT critical care codes, all time spent engaged in work directly related to the individual patient's care would count toward the time reported with the inpatient visit codes; this includes time spent at the immediate bedside or elsewhere on the floor or unit, such as time spent with the patient and family members, reviewing test results or imaging studies, discussing care with other staff, and documenting care.

(ii) Coding for Office and Other Outpatient Global Services Visits

Our proposal includes three codes that would be used for reporting post-operative visits in the office or other outpatient settings. For these three codes, time would be defined as the face-to-face time with patient, which reflects the current rules for time-based outpatient codes.

Under our proposal, GXXX4 (Office or other outpatient visit, clinical staff, per 10 minutes, included in surgical package) would be used for visits in which the clinical care is provided by clinical staff.

GXXX5 (Office or other outpatient visit, typical, per 10 minutes, included in surgical package) would be used for reporting any combination of activities in Table 10. Based on the findings from the interviews and the TEP, RAND reports that the vast majority of office or other outpatient visits would be expected to be reported using the GXXX5 code.

Accordingly, we would expect the office or other outpatient visit code, complex, GXXX6 (Office or other outpatient visit, complex, per 10 minutes, included in surgical package), to be used infrequently. Examples of when it might be used include management of a particularly complex patient such as a patient with numerous comorbidities or high likelihood of dying, management of a significant complication, or management or discussion of a complex diagnosis (For Start Printed Page 46196example, new cancer diagnosis, high risk of mortality). Practitioners would include documentation in the medical record as to what services were provided that exceeded those included in a typical visit.

Only face-to-face time spent by the practitioner with the patient and their family members would count toward the time reported with the office visit codes. Therefore, even though the codes for both inpatient and outpatient settings use the same time increment, the services that are included differ by setting, consistent with the variation in existing coding conventions.

(iii) Coding for Services Furnished Via Electronic Means

Services that are provided via phone, the internet, or other electronic means outside the context of a face-to-face visit would be reported using GXXX7 when furnished by a practitioner and GXXX8 when furnished by clinical staff. We are proposing that practitioners would not report these services if they are furnished the day before, the day of, or the day after a visit as we believe these would be included in the pre- and post-service activities in the typical visit. However, we are proposing that these codes be used to report non-face-to-face services provided by clinical staff prior to the primary procedure since global surgery codes are typically valued with assumptions regarding pre-service clinical labor time. Given that some practitioners have indicated that services they furnish commonly include activities outside the face-to-face service, we believe it is important to capture information about those activities in both the pre- and post-service periods. We believe these requirements to report on clinical labor time are consistent with and no more burdensome than those used to report clinical labor time associated with chronic care management services, which similarly describe care that takes place over more than one patient encounter.

In addition, for services furnished via interactive telecommunications that meet the requirements of a Medicare telehealth service visit, the appropriate global service G-code for the services should be reported with the GT modifier to indicate that the service was furnished “via interactive audio and video telecommunications systems.”

(iv) Benefits of G-Codes

One commenter indicated that the documentation requirements and PEs for post-operative visits differ from those of other E/M visits, and encouraged us to develop a separate series of codes to capture the work of the post-operative services and to measure, not just estimate, the number and complexity of visits during the global period. Others opposed the use of a new set of codes or the use of modifiers to collect information on post-operative visits. After considering the RAND report, the comments and other stakeholder input that we have received, and our needs for data to fulfill our statutory mandate and to value surgical services appropriately, we are proposing this new set of codes because we believe it provides us the most robust data upon which to determine the most appropriate way and amounts to pay for PFS surgical services. We believe that the codes being proposed would provide data of the kind that can reasonably collected through claims data and that reflect what we believe are key issues in the post-operative care where the service is provided, who furnishes the service, its relative complexity, and the time involved in the service.

We seek public comments about all aspects of these codes, including the nature of the services described, the time increment, and any other areas of interest to stakeholders. We are particularly interested in any pre- or post-operative services furnished that could not be appropriately captured by these codes. Although RAND developed this set of codes to collect data on post-operative services, we are proposing to also use such codes to collect data on pre-operative services. We are seeking comments on whether the codes discussed above are appropriate for collecting data on pre-operative services or whether additional codes should be added to distinguish in the data collected the resources used for pre-operative services from those used for post-operative services. We also seek comment on any activities that should be added to the list of activities in Table 10 to reflect typical pre-operative visit activities.

(v) Alternative Approach to Coding

As noted above, many stakeholders expressed strong support for the use of CPT code 99024 (Postoperative follow-up visit, normally included in the surgical package, to indicate that an evaluation and management service was performed during a postoperative period for a reason(s) related to the original procedure) to collect data on post-operative care. Stakeholders suggest that practitioners are familiar with this existing CPT code and the burden on practitioners would be minimized by only having to report that a visit occurred, not the level of the visit. We do not believe that this code alone would provide the information that we need for valuing surgical services nor do we believe it alone can meet the statutory requirement that we collect data on the number and level of visits because it does not provide any information beyond the number of visits. Although we are proposing to use the G-codes detailed above to measure pre- and post-operative visits, given the strong support that many stakeholders have for the use of CPT code 99024, we are soliciting comments specifically on how we could use this code to capture the statutorily required data on the number and level of visits and the data that we would need to value global services in the future.

Some have suggested using CPT code 99024 with modifiers to indicate to which of the existing levels of E/M codes the visit corresponds. As outlined in the RAND report, E/M visits may not accurately capture what drives greater complexity in post-operative visits. E/M billing requirements are built upon complexity in elements such as medical history, review of systems, family history, social history, and how many organ systems are examined. In the context of a post-operative visit, many of these elements may be irrelevant. RAND also noted that there was significant concern from interviewees and the expert panel about documentation that is required for reporting E/M codes. Specifically, they argued that documentation requirements for surgeons to support the relevant E/M visit code would place undue administrative burden on surgeons. RAND reported that many surgeons currently use minimal documentation when they provide a postoperative visit. Moreover, to value surgical packages accurately we need to understand the activities involved in furnishing post-operative care and as discussed above, we lack information that would demonstrate that activities involved in post-operative care are similar to those in E/M services. In addition, the use of modifiers to report levels of services is more difficult to operationalize than using unique HCPCS codes. However, we would be interested in whether, and if so, why, practitioners would find it easier to report CPT code 99024 with modifiers corresponding to the proposed G-code levels rather than the new G-codes, as proposed. We are also seeking comment on whether practitioners would find it difficult to use this for pre-operative visits since the CPT code descriptor specifically defines it as a “post-operative follow-up” service.Start Printed Page 46197

We are also seeking comment on whether time of visits could alone be a proxy for the level of visit. If pre- and post-operative care varies only by the time the practitioner spends care so that time could be a proxy for complexity of the service, then we could use the reporting of CPT code 99024 in 10-minute increments to meet the statutory requirement of collecting claims-based data on the number and level of visits. In addition to comments on whether time is an accurate proxy for level of visit, we are seeking comment on the feasibility and desirability of reporting CPT 99024 in 10-minute increments.

c. Reporting of Claims

We propose that the G-codes detailed above would be reported for services related to and within 10- and 90-day global periods for procedures furnished on or after January 1, 2017. Services related to the procedure furnished following recovery and otherwise within the relevant global period would be required to be reported. These codes would be included on claims filed through the usual process. Through this mechanism, we would collect all of the information reported on a claim for services, including information about the practitioner, service furnished, date of service, and the units of service. By not imposing special reporting requirements on the reporting of these codes, we intend to allow practitioners the flexibility to report the services on a rolling basis as they are furnished or to report all of the services on one claim once all have been furnished, as long as the filed claims meet the requirements for filing claims. As with all other claims, we would expect the patient's medical record to include documentation of the services furnished. Documentation that would be expected is an indication that a visit occurred or a service was furnished and sufficient information to determine that the appropriate G-code was reported.

We are not proposing any special requirements for inclusion of additional data on claims that could be used for linking the post-operative care furnished to a particular service. To use the data reported on post-operative visits for analysis and valuation, we will link the data reported on post-operative care to the related procedure using date of service, practitioner, beneficiary, and diagnosis. We believe this approach to matching will allow us to accurately link the preponderance of G-codes to the related procedure. However, we solicit comment on the extent to which post-operative care may not be appropriately linked to related procedures whether we should consider using additional variables to link these aspects of the care, and whether additional data should be required to be reported to enable a higher percentage of matching.

d. Special Provisions for Teaching Physicians

We are seeking comment on whether special provisions are needed to capture the pre- and post-operative services provided by residents in teaching settings. If the surgeon is present for the key portion of the visit, should the surgeon report the joint time spent by the resident and surgeon with the patient? If the surgeon is not present for the key portion of the visit, should the resident report the service? If we value services without accounting for services provided by residents that would otherwise be furnished by the surgeon in non-teaching settings, subsequent valuations based upon the data we collect may underestimate the resources used, particularly for the types of surgeries typically furnished in teaching facilities. However, there is also a risk of overvaluing services if the reporting includes services that are provided by residents when those services would otherwise be furnished by a physician other than the surgeon, such as a hospitalist or intensivist, and as such, should not be valued in the global package.

e. Who Reports

In both the comments on the CY 2016 proposed rule and in the national listening session, there was a great deal of discussion regarding the challenges that we are likely to encounter in obtaining adequate data to support appropriate valuation. Some indicated that a broad sample and significant cooperation from physicians would be necessary to understand what is happening as part of the global surgical package. One commenter suggested that determining a representative sample would be difficult and, due to the variability related to the patient characteristics, it would be easier to have all practitioners report. Many suggested that we conduct an extensive analysis across surgical specialties with a sample that is representative of the entire physician community and covers the broad spectrum of the various types of physician practice to avoid problems that biased or inadequate data collection would cause. Suggestions of factors to account for in selecting a sample include specialty, practice size (including solo practices), practice setting, volume of claims, urban, rural, type of surgery, and type of health care delivery systems. Another commenter pointed out that small sample sizes may lead to unreliable data. On the other hand, some commenters stated that requiring all practitioners to report this information is unreasonable and would be an insurmountable burden. A participant acknowledged that it would be difficult for practitioners to report on only certain procedures, while another stated that this would not be an administrative burden.

After considering the input of stakeholders, we are proposing that any practitioner who furnishes a procedure that is a 10- or 90-day global report the pre- and post-operative services furnished on a claim using the codes proposed above. We agree with stakeholders that it is necessary to obtain data from a broad, representative sample across specialties, geographic location, and practice size, practice model, patient acuity, and differing practice patterns. However, as we struggled to develop a sampling approach that would result in statistically reliable and valid data, it became apparent that we do not have adequate information about how post-operative care is delivered, how it varies and, more specifically, what drives variation in post-operative care. In its work to develop the coding used for its study, RAND found a range of opinions on what drives variation in post-operative care. (The report is available on the CMS Web site under downloads for the CY 2017 PFS proposed rule with comment period at http://www.cms.gov/​physicianfeesched/​downloads/​.) Without information on what drives variation in pre- and post-operative care, we would have to speculate about the factors upon which to base a sample or assume that the variation in such care results from the same variables as are frequently identified for explaining variation in health care and clinical practice. In addition, we have concerns about whether a sample could provide sufficient volume to value accurately the global package, except in the case of a few high-volume procedures.

In addition to concerns about achieving an appropriate, sufficient, and unbiased representative sample of practitioners, we have significant operational concerns with collecting data from a limited sample of practitioners or on a limited sample of services. These include how to gain sufficient information on practitioners to sufficiently stratify the sample, how to identify the practitioners who must report, determining which services, and for those who practice in multiple settings and/or with multiple groups in which settings the practitioner would report. Establishing the rules to govern Start Printed Page 46198which post-operative care should be reported for which procedures would be challenging for us to develop for a random sample and difficult for physicians to apply.

With the limited time between the issuance of the CY 2017 PFS final rule with comment period and the beginning of reporting on January 1st, it would be challenging to make sure that affected practitioners are aware of the requirement to report and have an ability to determine which post-operative care to report. If, instead, we require all practitioners to report, we can take a uniform approach to notifying practitioners. The national medical and coding organizations are routinely relied upon by practitioners for information on new coding and billing requirements and play a major role in the expeditious adoption of new coding or billing requirements. Similarly, adjustments to software used for medical records and coding are made by national organizations. We have concerns that if this requirement is only applied to a small segment of practitioners that these organizations will not be able to ensure that the affected practitioners are aware and easily able to comply with the requirements.

The more robust the reported data, the more accurate our ultimate valuations can be. Given the importance of data on visits in accurate valuations for global packages, we believe that collecting data on all pre- and post-operative visits in the global period is the best way to accurately value surgical procedures with global packages.

We recognize that reporting of all pre- and post-operative visits would require submission of additional claims by those practitioners furnishing global services, but we believe the benefits of accurate data for valuation of services merits the imposition of this requirement. By using the claims system to report the data, we believe the additional burden is minimized. Stakeholders have reported that many practitioners are already required by their practice or health care system to report a code for each visit for internal control purposes and some of these systems already submit claims for these services, which are denied. For these practices, the additional burden would be minimal. We believe that requiring only some physicians to report this information, or requiring reporting for only some services, could actually be more burdensome to physicians than requiring this information from all physicians on all services because of the additional steps necessary to determine whether a report is required for a particular service and adopting a mechanism to assure that data is collected and reported when required. Moreover, we believe the challenges with implementing a limited approach at the practice level as compared to a requirement for all global services would result in less reliable data being reported.

As we analyze the data collected and make decisions about valuations, we would reassess the data needed and what should be required from whom. Under section 1848(c)(8)(B)(ii) of the Act, we are required to reassess every 4 years whether continued collection of these data is needed. However, we can modify through rulemaking what data is collected at any time, as appropriate. By collecting data on all procedures with a 10- or 90-day global package, we would have the information to assess whether the post-operative care furnished varies by factors such as specialty, geography, practice setting, and practice size, and thus, the information needed for a selection of a representative sample. By initially collecting information from all practitioners that furnish surgical services, we believe we would be able to reduce required reporting in the future if we find that adequate information can be obtained by selective reporting. Without the broader set of data we would not be able to evaluate the variability of pre- and post-operative care in order to identify a useful targeted data collection.

While section 1848(c)(8)(B) of the Act requires us to collect data from a representative sample of physicians on the number and level of visits provided during the global period, it does not prohibit us from collecting data from a broad set of physicians. In addition, section 1848(c)(2)(M) of the Act authorizes the collection of data from a wide range of physicians. Given the benefits of more robust data, including avoiding sample bias, obtaining more accurate data, and facilitating operational simplicity, we believe collecting data on all post-operative care initially is the best way to undertake an accurate valuation of surgical services in the future.

(1) Survey of Practitioners

We agree with commenters that we need more information than is currently provided on claims and that we should utilize a number of different data sources and collection approaches to collect the data needed to assess and revalue global surgery services. In addition to the claims-based reporting, we are proposing to survey a large, representative sample of practitioners and their clinical staff in which respondents would report information about approximately 20 discrete pre-operative and post-operative visits and other global services like care coordination and patient training. The proposed survey would produce data on a large sample of pre-operative and post-operative visits and is being designed so that we could analyze the data collected in conjunction with the claims-based data that we would be collecting. We expect to obtain data from approximately 5,000 practitioners.

We have contracted with RAND to develop and, if our proposal is finalized, conduct this survey. RAND would also assist us in analyzing data collected under this survey and the claims-based data. While the primary data collection would be via a survey instrument, RAND would conduct semi-structured interviews and direct observations of data in a small number of pilot sites to inform survey design, validate survey results, and collect information that is not conducive to survey-based reporting.

Our proposed sampling approach would sample practitioners rather than for procedures or visits to streamline survey data collection and minimize respondent burden. Specifically, we propose to representative and random sample from a frame of providers who billed Medicare for more than a minimum threshold of surgical procedures with a 10- or 90-day global period (for example, 200 procedures) in the most recent available prior year of claims data. We expect to survey approximately 5,000 practitioners, stratified by specialty, geography, and practice type. Based upon preliminary analysis we believe this number of participants will allow us to collect information on post-operative care following the full range of CPT level-2 surgical procedure code groups. A smaller sample size would reduce the precision of estimates from the survey and more importantly risk missing important differences in post-operative care for specific specialties or following different types of surgical procedures. We expect a response rate in excess of 50 percent.

We are not proposing that respondents report on the entire period of post-operative care for individual patients, as a 90-day follow-up window (for surgeries currently with a 90-day global period) is too long to implement practically in this study setting and would be more burdensome to practitioners. Instead, we propose to collect information on a range of different post-operative services resulting from surgeries furnished by Start Printed Page 46199the in-sample practitioner prior to or during a fixed reporting period.

Each sampled practitioner will be assigned to a specified and brief (for example, 2-week) reporting period. Given the proposed overall data collection period, the selected sample of providers will be randomly divided into 6 subsets within each specialty, each of which will be assigned to a specified reporting period. Practitioners will be asked to describe 20 post-operative visits furnished to Medicare beneficiaries or other patients during the reporting period. The information collected through the survey instrument, which will be developed based upon direct observation and discussions in a small number of pilot sites, will include contextual information to describe the background for the post-operative care, including, for example:

  • Procedure codes(s) and date of service for procedure upon which the global period is based.
  • Procedure place of service (type).
  • Whether or not there were complications during or after the procedure.
  • The number in sequence of the follow-up visit (for example, the first visit after the procedure).

The survey instrument will also collect information on the visit in question including, for example:

  • Which level of visit using the finalized no-pay codes.
  • Specific pre-service, face-to-face, and post-service activities furnished during the visit.
  • Times for each activity.
  • Identify who performed each activity (physician or other practitioner).
  • PE components used during the visit, for example supplies like surgical dressings and clinical staff time.

Finally, the instrument will ask respondents to report other prior or anticipated care furnished to the patient by the practice outside of the context of a post-operative visit, for example non-face-to-face services.

The survey approach will complement the claims data collection by collecting detailed information on the activities, time, intensity, and resources involved in delivering global services. The resulting visit-level survey data would allow us to explore in detail the variation in activities, time, intensity, and resources associated with global services within and between physicians and procedures, and would help to validate the information gathered through claims. A summary of the work that RAND would be doing is available on the CMS Web site under downloads for the CY 2017 PFS proposed rule with comment period at http://www.cms.gov/​physicianfeesched/​downloads/​.

(2) Required Participation in Data Collection

Using the authority we are provided under sections 1848(c)(8) and 1848(c)(2)(M) of the Act, we are proposing to require all practitioners who furnish a 10- or 90-day global service to submit a claim(s) providing information on all services furnished within the relevant global service period in the form and manner described below, beginning with surgical or procedural services furnished on or after January 1, 2017. We are also proposing to require participation by practitioners selected for the broad-based survey through which we are proposing to gather additional data needed to value surgical services, such as the clinical labor and equipment involved that cannot be efficiently collected on claim (see below).

Given the importance of the proposed survey effort, making sure that we get valid data is critical. By eliminating the bias that would be associated with using only data reported voluntarily, we believe we will get more accurate and representative data. In addition to the potential bias inherent in voluntary surveys, we are concerned that relying on voluntary data reporting would limit the adequacy of the volume of data we obtain, will require more effort to recruit participation, and may make it impossible to obtain data for valuation for CY 2019 as required by the statute.

Based on our previous experience with requesting voluntary cooperation in data collection activity, voluntary participation poses a significant challenge in data collection. Specifically, the Urban Institute's work (under contract with us) to validate work RVUs by conducting direct observation of the time it took to furnish certain elements of services paid under the physician fee schedule provides evidence of this challenge. (See https://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​PhysicianFeeSched/​Downloads/​RVUs-Validation-Urban-Interim-Report.pdf for an interim report that describes challenges in securing participation in voluntary data collection.) Similarly, we routinely request invoices on equipment and supplies that are used in furnishing services and often receive no more than one invoice. These experiences support the idea that mandatory participation in data collection activities is essential if we are to collect valid and unbiased data.

Section 1848(a)(9) of the Act authorizes us, through rulemaking, to withhold payment of up to 5 percent of the payment for services on which the practitioner is required to report under section 1848(c)(8)(B)(i) of the Act until the practitioner has completed the required reporting. Some commenters opposed the imposition of this payment withhold, and others said it was too large of a penalty. While we believe this is a way to encourage practitioners to report on claims the information we propose to require on care that is furnished in the global period, we are not proposing to implement this option at this time. We believe that requiring physicians to report the information on claims, combined with the incentive to report complete information so that we can make appropriate revisions when we revalue payments for global surgical services, would result in compliance with the reporting requirements. However, we note that if we find that compliance with required claims-based reporting is not acceptable, we would consider in future rulemaking imposing up to a 5 percent payment withhold as authorized by the statute.

Consistent with the requirements of section 1848(c)(2)(M) of the Act, should the data collected under this requirement be used to determine RVUs, we will disclose the information source and discuss the use of such information in such determination of relative values through future notice and comment rulemaking.

(3) Data Collection From Accountable Care Organizations (ACOs)

We are particularly interested in knowing whether physicians and practices affiliated with ACOs expend greater time and effort in providing post-operative global services in keeping with their goal of improving care coordination for their assigned beneficiaries. ACOs are organizations in which practitioners and hospitals voluntarily come together to provide high-quality and coordinated care for their patients. Because such organizations share in the savings realized by Medicare, their incentive is to minimize post-operative visits while maintaining high quality post-operative care for patients. In addition, we believe that such organizations offer us the opportunity to gain more in-depth information about delivery of surgical services.

We propose to collect primary data on the activities and resources involved in delivering services in and around surgical events in the ACO context by surveying a small number of ACOs (Pioneer and Next Generation ACOs). Start Printed Page 46200Similar to the approach of the more general practitioner survey, this effort would begin with an initial phase of primary data collection using a range of methodologies in a small number of ACOs; development, piloting, and validation of an additional survey module specific to ACOs. A survey of practitioners participating in approximately 4 to 6 ACOs using the survey instrument along with the additional ACO-specific module will be used to collect data from on pre- and post-operative visits.

(4) Conclusion

We recognize that the some of the data collection activity proposed here varies greatly from how the data is currently gathered to support PFS valuations for global surgery services. However, we believe the proposed claims-based data collection is generally consistent with how claims data is reported for other kinds of services paid under the PFS. We believe that the authority and requirements included in the statute through the MACRA and PAMA were intended to expand and enhance data that might be available to enhance the accuracy of PFS payments. Because these are new approaches to collecting data and in an area—global surgery—where very little data has previously been collected, we cannot describe exactly how this information would be used in valuing services. What is clear is that the claims-based data would provide information parallel to the kinds of claims-data used in developing RVUs for other PFS services and that by collecting these data, we would know far more than we do now about how post-operative care is delivered and gain insight to support appropriate packaging and valuation. We would include any revaluation proposals based on these data in subsequent notice and comment rulemaking.

E. Improving Payment Accuracy for Primary Care, Care Management, and Patient-Centered Services

1. Overview

In recent years, we have undertaken ongoing efforts to support primary care and patient-centered care management within the PFS as part of HHS' broader efforts to achieve better care, smarter spending and healthier people through delivery system reform. We have recognized the need to improve payment accuracy for primary care and patient-centered care management over several years, especially beginning in the CY 2012 PFS proposed rule (76 FR 42793) and continuing in each subsequent year of rulemaking. In the CY 2012 proposed rule, we acknowledged the limitations of the current code set that describes evaluation & management (E/M) services within the PFS. For example, E/M services represent a high proportion of PFS expenditures but have not been recently revalued to account for significant changes in the disease burden of the Medicare patient population and changes in health care practice that are underway, to meet the current population's health care needs. These trends in the Medicare population and health care practice have been widely recognized in the provider community and by health services researchers and policymakers alike.[1] We believe the focus of the health care system has shifted to delivery system reforms, such as patient-centered medical homes, clinical practice improvement, and increased investment in primary and comprehensive care management/coordination services for chronic and other conditions. This shift requires centralized management of patient needs and extensive care coordination among practitioners and providers (often on a non-face-to-face basis across an extended period of time). In contrast, the current CPT code set is designed with an overall orientation to pay for discrete services and procedural care as opposed to ongoing primary care, care management and coordination, and cognitive services. It includes thousands of separately paid, individual codes, most of which describe highly specialized procedures and diagnostic tests, while there are relatively few codes that describe care management and cognitive services. Further, in the past, we have not recognized as separately payable many existing CPT codes that describe care management and cognitive services, viewing them as bundled and paid as part of other services including the broadly drawn E/M codes that describe face-to-face visits billed by physicians and practitioners in all specialties.

This has resulted in minimal service variation for ongoing primary care, care management and coordination, and cognitive services relative to other PFS services, and in potential misvaluation of E/M services under the PFS (76 FR 42793). Some stakeholders believe that there is substantial misvaluation of physician work within the PFS, and that the current service codes fail to capture the range and intensity of nonprocedural physician activities (E/M services) and the “cognitive” work of certain specialties (http://www.nejm.org/​doi/​full/​10.1056/​NEJMp1600999#t=​article).

Recognizing the inverse for specialties that furnish other kinds of services, MedPAC has noted that the PFS allows some specialties to more easily increase the volume of services they provide (and therefore their revenue from Medicare) relative to other specialties, particularly those that spend most of their time providing E/M services. (MedPAC March 2015 Report to the Congress, available at http://www.medpac.gov/​-documents-/​reports). We agree with this analysis, and we recognize that the current set of E/M codes limits Medicare's ability under the PFS to appropriately recognize the relative resource costs of primary care, care management/coordination and cognitive services relative to specialized procedures and diagnostic tests.

In recent years, we have been engaged in an ongoing incremental effort to update and improve the relative value of primary care, care management/coordination, and cognitive services within the PFS by identifying gaps in appropriate payment and coding. These efforts include changes in payment and coding for a broad range of PFS services. This effort is particularly vital in the context of the forthcoming transition to the Merit-Based Incentive Payment System (MIPS) and Alternative Payment Models (APMs) incentives under The Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) (Pub. L. 114-10, enacted April 16, 2015), since MIPS and many APMs will adopt and build on PFS coding, RVUs and PFS payment as their foundation.

In CY 2013, we began by focusing on post-discharge care management and transition of beneficiaries back into the community, establishing new codes to pay separately for transitional care management (TCM) services. Next we finalized new coding and separate payment beginning in CY 2015 for chronic care management (CCM) services provided by clinical staff. Most recently, in the CY 2016 PFS proposed rule (80 FR 41708 through 41711), we solicited public comments on three additional policy areas of consideration: (1) Improving payment for the professional work of care management Start Printed Page 46201services through coding that would more accurately describe and value the work of primary care and other cognitive specialties for complex patients (for example, monthly timed services including care coordination, patient/caregiver education, medication management, assessment and integration of data, care planning); (2) establishing separate payment for collaborative care, particularly, how we might better value and pay for robust inter-professional consultation, between primary care physicians and psychiatrists (developing codes to describe and provide payment for the evidence-based psychiatric collaborative care model (CoCM), and between primary care physicians and other (non-mental health) specialists; and (3) assessing whether current PFS payment for CCM services is adequate and whether we should reduce the administrative burden associated with furnishing and billing these services.

In the CY 2016 PFS final rule with comment period (80 FR 70919 through 70921), we summarized the many public comments we received in response to last year's comment solicitation. Instead of the specific policies we sought comment on, several commenters recommended an overhaul and complete revaluation of the E/M codes through a major research initiative akin to that undertaken when the PFS was first established. Many other commenters recommended that, until a major research initiative could be conducted to fully address the deficiencies in the current E/M code set, CMS should make separate payment under Medicare for a number of existing CPT codes to improve payment in the areas in which we solicited comments, including the codes used to describe complex CCM services (CPT codes 99487 and 99489). Other commenters also suggested that care management services may be beneficial to a number of other patient populations in addition to those transitioning into the community from an inpatient setting and those with multiple chronic conditions.

Also in response to our CY 2016 comment solicitation, the AMA restructured its existing CPT/RUC workgroup on these issues and convened the relevant individual specialty societies to develop new CPT coding that would address these issues. We understand that these efforts are ongoing, and that at this time, two sets of new codes are scheduled to be included in the CY 2018 CPT code set in response to our 2016 comment solicitation. One is a set of new codes describing services furnished under the psychiatric CoCM and the other is a code for assessment and care planning services for patients with cognitive impairment. Several stakeholders have urged us to facilitate Medicare payment for these and other new primary care, care management, and cognitive services sooner than CY 2018 by proposing payment using G-codes for CY 2017.

In response to our comment solicitation in the CY 2016 proposed rule, MedPAC commented that the PFS is an ill-suited payment mechanism for primary care and cognitive care generally. MedPAC recommended that Congress replace the expired Primary Care Incentive Payment (PCIP) with a capitated payment mechanism and expressed preference for codes like CCM that are beneficiary-centered and do not pay for each distinct care coordination activity.

Finally, many public commenters recommended a number of modifications to the current CCM payment rules. According to many commenters, current payment does not cover the cost of furnishing these services, and therefore, the codes are underutilized. As referenced in section II.E.3 on improving access and payment for CCM services, our assessment of claims data for CY 2015 for CPT code 99490 suggests that CCM services may be underutilized relative to the intended eligible patient population.

After considering the commenters' perspective and recommendations, as well as monitoring the ongoing efforts at the AMA/RUC and CPT to respond with new/revised coding, for CY 2017 we are proposing a number of changes to coding and payment policies under the PFS. These proposals are intended to accomplish the following:

  • Improve payment for care management services provided in the care of beneficiaries with behavioral health conditions (including services for substance use disorder treatment) through new coding, including three codes used to describe services furnished as part of the psychiatric CoCM and one to address behavioral health integration more broadly.
  • Improve payment for cognition and functional assessment, and care planning for beneficiaries with cognitive impairment.
  • Adjust payment for routine visits furnished to beneficiaries whose care requires additional resources due to their mobility-related disabilities.
  • Recognize for Medicare payment the additional CPT codes within the Chronic Care Management family (for Complex CCM services) and adjust payment for the visit during which CCM services are initiated (the initiating CCM visit) to reflect resources associated with the assessment for, and development of, a new care plan.
  • Recognize for Medicare payment CPT codes for non-face-to-face Prolonged E/M services by the physician (or other billing practitioner) that are currently bundled, and increase payment rates for face-to-face prolonged E/M services by the physician (or other billing practitioner) based on existing RUC recommended values.

We are aware that CPT has approved a code to describe assessment and care planning for patients with cognitive impairment; however, it will not be ready in time for valuation in CY 2017. Therefore, we are proposing to make payment using a G-code (GPPP6—see below) for this service in 2017. We are also aware that CPT has approved three codes that describe services furnished consistent with the psychiatric CoCM, but that they will also not be ready in time for valuation in CY 2017. We discuss these services in more detail in the next section of this proposed rule. To facilitate separate payment for these services furnished to Medicare beneficiaries during CY 2017, we are proposing to make payment through the use of three G-codes (GPPP1, GPPP2, and GPPP3—see below) that parallel the new CPT codes, as well as a fourth G-code (GPPPX—see below) to describe services furnished using a broader application of behavioral health integration in the primary care setting. We intend for these to be temporary codes (for perhaps only one year) and will consider whether to adopt and establish values for the new CPT codes under our standard process, presumably for CY 2018. While we recognize that there may be overlap in the patient populations for the proposed new G-codes, we note that time spent by a practitioner or clinical staff cannot be counted more than once for any code (or assigned to more than one patient), consistent with PFS coding conventions.

Proposed payment for services described by new coding are as follows (please note that the descriptions included for GPPP1, GPPP2, and GPPP3 are from Current Procedural Terminology (CPT®) Copyright 2016 American Medical Association (and will be effective as part of CPT codes January 1, 2018). All rights reserved):

  • GPPP1: Initial psychiatric collaborative care management, first 70 minutes in the first calendar month of behavioral health care manager activities, in consultation with a psychiatric consultant, and directed by the treating physician or other qualified Start Printed Page 46202health care professional, with the following required elements:

++ Outreach to and engagement in treatment of a patient directed by the treating physician or other qualified health care professional;

++ Initial assessment of the patient, including administration of validated rating scales, with the development of an individualized treatment plan;

++ Review by the psychiatric consultant with modifications of the plan if recommended;

++ Entering patient in a registry and tracking patient follow-up and progress using the registry, with appropriate documentation, and participation in weekly caseload consultation with the psychiatric consultant; and

++ Provision of brief interventions using evidence-based techniques such as behavioral activation, motivational interviewing, and other focused treatment strategies.

  • GPPP2: Subsequent psychiatric collaborative care management, first 60 minutes in a subsequent month of behavioral health care manager activities, in consultation with a psychiatric consultant, and directed by the treating physician or other qualified health care professional, with the following required elements:

++ Tracking patient follow-up and progress using the registry, with appropriate documentation;

++ Participation in weekly caseload consultation with the psychiatric consultant;

++ Ongoing collaboration with and coordination of the patient's mental health care with the treating physician or other qualified health care professional and any other treating mental health providers;

++ Additional review of progress and recommendations for changes in treatment, as indicated, including medications, based on recommendations provided by the psychiatric consultant;

++ Provision of brief interventions using evidence-based techniques such as behavioral activation, motivational interviewing, and other focused treatment strategies;

++ Monitoring of patient outcomes using validated rating scales; and relapse prevention planning with patients as they achieve remission of symptoms and/or other treatment goals and are prepared for discharge from active treatment.

  • GPPP3: Initial or subsequent psychiatric collaborative care management, each additional 30 minutes in a calendar month of behavioral health care manager activities, in consultation with a psychiatric consultant, and directed by the treating physician or other qualified health care professional (List separately in addition to code for primary procedure) (Use GPPP3 in conjunction with GPPP1, GPPP2).
  • GPPPX: Care management services for behavioral health conditions, at least 20 minutes of clinical staff time, directed by a physician or other qualified health care professional time, per calendar month.
  • GPPP6: Cognition and functional assessment using standardized instruments with development of recorded care plan for the patient with cognitive impairment, history obtained from patient and/or caregiver, by the physician or other qualified health care professional in office or other outpatient setting or home or domiciliary or rest home.
  • GPPP7: Comprehensive assessment of and care planning by the physician or other qualified health care professional for patients requiring chronic care management services, including assessment during the provision of a face-to-face service (billed separately from monthly care management services) (Add-on code, list separately in addition to primary service).
  • GDDD1: Resource-intensive services for patients for whom the use of specialized mobility-assistive technology (such as adjustable height chairs or tables, patient lifts, and adjustable padded leg supports) is medically necessary and used during the provision of an office/outpatient evaluation and management visit (Add-on code, list separately in addition to primary procedure).

Additionally, we are aware that other codes are being developed through the CPT process. We have noted with interest that the CPT Editorial Panel and AMA/RUC restructured the former Chronic Care Coordination Workgroup to establish a new Emerging CPT and RUC Issues Workgroup that we hope will continue to consider the issues raised in this section of our CY 2017 proposed rule. We are continuing to consider possible additional codes for CCM services that would describe the time of the physician or other billing practitioner. We also remain interested in whether there should be changes under the PFS to reflect additional models of inter-professional collaboration for health conditions, in addition to those we are proposing for behavioral health integration.

For additional details on the coding and proposed valuation related to these proposals, see section II.L of this proposed rule for Valuation of Specific Codes. We note that the development of coding for these and other kinds of services across the PFS is typically an iterative process that responds to changes in medical practice and may be best refined over several years, with PFS rulemaking and the development of CPT codes as important parts of that process. Thus, we anticipate continuing the multi-year process of implementing initiatives designed to improve payment for, and recognize long-term investment in, primary care, care management and cognitive services, and patient-centered services.

2. Non-Face-To-Face Prolonged Evaluation Management (E/M) Services

In public comments to the CY 2016 PFS proposed rule, many commenters recommended that CMS should establish separate payment for non-face-to-face prolonged E/M service codes that we currently consider to be “bundled” under the PFS (CPT codes 99358, 99359). The CPT descriptors are:

  • CPT code 99358 (Prolonged evaluation and management service before and/or after direct patient care, first hour); and
  • CPT code 99359 (Prolonged evaluation and management service before and/or after direct patient care, each additional 30 minutes (List separately in addition to code for prolonged service).

Commenters believed that separate payment for these existing CPT codes would provide a means for physicians and other billing practitioners to receive payment that more appropriately accounts for time that they spend providing non-face-to-face care. We agree that these codes would provide a means to recognize the additional resource costs of physicians and other practitioners when they spend an extraordinary amount of time outside the in-person office visit caring for the individual needs of their patients. And we believe that doing so in the context of the ongoing changes in health care practice to meet the current population's health care needs would be beneficial for Medicare beneficiaries and consistent with our overarching goals related to patient-centered care.

These non-face-to-face prolonged service codes are broadly described (although they include only time spent personally by the physician or other billing practitioner) and have a relatively high time threshold (the time counted must be beyond the usual service time for the primary or companion E/M code that is also billed). We believe this makes them sufficiently distinct from the other codes we propose to pay in CY 2017 as part of our Start Printed Page 46203primary care/care management/cognitive care initiative described in this section of our proposed rule. Accordingly, beginning in CY 2017 we propose to recognize CPT codes 99358 and 99359 for separate payment under the PFS. We note that time could not be counted more than once towards the provision of CPT codes 99358 or 99359 and any other PFS service. See section II.L for a discussion of our proposed valuation of CPT codes 99358 and 99359.

We propose to require the services to be furnished on the same day by the same physician or other billing practitioner as the companion E/M code. However, in reviewing the CPT guidance for CPT codes 99358 and 99359, we noted that CPT codes 99358 and 99359 should not be reported during the same service period as complex CCM services (CPT codes 99487, 99489) or TCM services (CPT codes 99495, 99496). One reason for excluding TCM and complex CCM services from concurrent billing would be that, like prolonged services, TCM and complex CCM services include substantial non-face-to-face work by the billing physician or other practitioner (an E/M visit and/or medical decision-making of moderate or high complexity). However, the CPT prolonged service with patient contact codes are billable on the same day an E/M service is furnished, and the CPT prolonged service codes without direct patient contact are services furnished during a single day that are directly related to a discrete face-to-face service. In contrast, TCM and CCM codes are billed monthly and focused on a broader episode of patient care. We are seeking public input on the intersection of the prolonged service codes with CCM and TCM services. We are also seeking public comment on the potential intersection of the prolonged service CPT codes 99358 and 99359 with proposed code GPPP7 (Comprehensive assessment of and care planning for patients requiring CCM services). Specifically, we are seeking comment regarding how distinctions among these services can be clearly delineated, including how the prolonged time can be clearly distinguished from typical pre- and post-service time, which is continued to be bundled with other codes. For all of these services, we have concerns that there may potentially be program integrity risks as the same non-face-to-face activities could be undertaken to meet the billing requirements for any of the above. We are seeking public comment to help us identify the full extent of program integrity considerations, as well as options for mitigating program integrity risks associated with these and other potentially overlapping codes.

3. Establishing Separate Payment for Behavioral Health Integration (BHI)

a. Psychiatric Collaborative Care Model (CoCM)

In the CY 2016 PFS final rule with comment period (80 FR 70920), we stated that we believed the care and management for Medicare beneficiaries with behavioral health conditions may include extensive discussion, information sharing and planning between a primary care physician and a specialist. We refer to this practice broadly as “Behavioral Health Integration” (BHI). In CY 2016 rulemaking, we described that in recent years, many randomized controlled trials have established an evidence base for an approach to caring for patients with behavioral health conditions called the psychiatric Collaborative Care Model (CoCM). A specific model for BHI, CoCM 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. As we previously noted, several resources have been published that describe the psychiatric CoCM in greater detail and assess the impact of the model, including pieces from the University of Washington (http://aims.uw.edu/​), the Institute for Clinical and Economic Review (http://icer-review.org/​announcements/​icer-report-presents-evidence-based-guidance-to-support-integration-of-behavioral-health-into-primary-care/​), and the Cochrane Collaboration (http://www.cochrane.org/​CD006525/​DEPRESSN_​collaborative-care-forpeople-with-depression-and-anxiety). Because this particular kind of collaborative care model has been tested and documented in medical literature, we expressed that we were particularly interested in comments on how coding under the PFS might facilitate appropriate valuation of the services furnished under the model. We also solicited comments to assist us in considering refinements to coding and payment to address this model in particular relative to current coding and payment policies, as well as information related to various requirements and aspects of these services.

After consideration of the comments, we are proposing to begin making separate payment for services furnished using the psychiatric CoCM beginning January 1, 2017. We are aware that CPT, recognizing the need for new coding for services under this model of care, has approved three codes to describe psychiatric collaborative care that is consistent with this model, but the codes will not be ready in time for valuation in CY 2017. Current CPT coding does not accurately describe or facilitate appropriate payment for the treatment of Medicare beneficiaries under this model of care. For example, under current Medicare payment policy, there is no payment made specifically for regular monitoring of patients using validated clinical rating scales or for regular psychiatric caseload review and consultation that does not involve face-to-face contact with the patient. We believe that these resources are directly involved in furnishing ongoing care management services to specific patients with specific needs, but they are not appropriately recognized under current coding and payment mechanisms. Because PFS valuation is based on the relative resource costs of the PFS services furnished to Medicare beneficiaries, we believe that appropriate coding for these services for CY 2017 will facilitate accurate payment for these and other PFS services. Therefore, we are proposing separate payment for services under the psychiatric CoCM using three new G-codes, as detailed above: GPPP1, GPPP2, and GPPP3, which would parallel the CPT codes that are being created to report these services. We intend for these to be temporary codes (for perhaps only one year) and will consider whether to adopt and establish values for the new CPT codes under our standard process, presumably for CY 2018.

Services in the psychiatric CoCM are provided under the direction of a treating physician or other qualified health care professional during a calendar month. These services are provided when a patient has a diagnosed psychiatric disorder that requires a behavioral health care assessment; establishing, implementing, revising, or monitoring a care plan; and provision of brief interventions. The diagnosis may be either pre-existing or made by the billing practitioner. These services are reported by the treating physician or other qualified health care Start Printed Page 46204professional and include the services of the treating physician or other qualified health care professional, the behavioral health care manager (see description below) who furnishes services incident to services of the treating physician or other qualified health care professional, and the psychiatric consultant (see description below) whose consultative services are furnished incident to services of the treating physician or other qualified health care professional. Patients who are appropriate candidates to participate in the psychiatric CoCM may have newly diagnosed conditions, need help in engaging in treatment, have not responded to standard care delivered in a non-psychiatric setting, or require further assessment and engagement prior to consideration of referral to a psychiatric care setting. Patients are treated under this model for an episode of care, defined as beginning when the behavioral health care manager engages in care of the patient under the appropriate supervision of the treating physician and ending with:

  • The attainment of targeted treatment goals, which typically results in the discontinuation of care management services and continuation of usual follow-up with the treating physician or other qualified healthcare professional; or
  • Failure to attain targeted treatment goals culminating in referral to a psychiatric care provider for ongoing treatment; or
  • Lack of continued engagement with no psychiatric collaborative care management services provided over a consecutive six month calendar period (break in episode).

A new episode of care starts after a break in episode of six calendar months or more.

The treating physician or other qualified health care professional directs the behavioral health care manager and continues to oversee the patient's care, including prescribing medications, providing treatments for medical conditions, and making referrals to specialty care when needed. Medically necessary E/M and other services may be reported separately by the treating physician or other qualified health care professional, or other physicians or practitioners, during the same calendar month. Time spent by the treating physician or other qualified health care professional on activities for services reported separately may not be included in the services reported using GPPP1, GPPP2, and GPPP3. The behavioral health care manager under this model of care is a member of the treating physician or other qualified health care professional's clinical staff with formal education or specialized training in behavioral health (which could include a range of disciplines, for example, social work, nursing, and psychology) who provides care management services, as well as an assessment of needs, including the administration of validated rating scales,[2] the development of a care plan, provision of brief interventions, ongoing collaboration with the treating physician or other qualified health care professional, maintenance of a registry,[3] all in consultation with a psychiatric consultant. The behavioral health care manager furnishes these services both face-to-face and non-face-to-face, and consults with the psychiatric consultant minimally on a weekly basis. We would expect that the behavioral health care manager would be on-site at the location where the treating physician or other qualified health care professional furnishes services to the beneficiary.

The behavioral health care manager may or may not be a professional who meets all the requirements to independently furnish and report services to Medicare. If otherwise eligible, then that individual may report separate services furnished a beneficiary receiving the services described by GPPP1, GPPP2, GPPP3, and GPPPX in the same calendar month. These could include: psychiatric evaluation (90791, 90792), psychotherapy (90832, 90833, 90834, 90836, 90837, 90838), psychotherapy for crisis (90839, 90840), family psychotherapy (90846, 90847), multiple family group psychotherapy (90849), group psychotherapy (90853), smoking and tobacco use cessation counseling (99406, 90407), and alcohol or substance abuse structured screening and brief intervention services (99408, 99409). Time spent by the behavioral health care manager on activities for services reported separately may not be included in the services reported using time applied to GPPP1, GPPP2, and GPPP3.

The psychiatric consultant involved in the “incident to” care furnished under this model is a medical professional trained in psychiatry and qualified to prescribe the full range of medications. The psychiatric consultant advises and makes recommendations, as needed, for psychiatric and other medical care, including psychiatric and other medical diagnoses, treatment strategies including appropriate therapies, medication management, medical management of complications associated with treatment of psychiatric disorders, and referral for specialty services, that are communicated to the treating physician or other qualified health care professional, typically through the behavioral health care manager. The psychiatric consultant does not typically see the patient or prescribe medications, except in rare circumstances, but can and should facilitate a referral to a psychiatric care provider when clinically indicated.

In the event that the psychiatric consultant furnishes services to the beneficiary directly in the calendar month described by other codes, such as E/M services or psychiatric evaluation (90791, 90792), the services may be reported separately by the psychiatric consultant. Time spent by the psychiatric consultant on activities for services reported separately may not be included in the services reported using GPPP1, GPPP2, and GPPP3.

We also note that, although the psychiatric CoCM has been studied extensively in the setting of specific behavioral health conditions (for example, depression), we received persuasive comments last year recommending that we not specify particular diagnoses required for use of the codes for several reasons, including that: there may be overlap in behavioral health conditions; there are concerns that there could be modification of diagnoses to fit within payment rules which could skew the accuracy of submitted diagnosis code data; and for many patients for whom specialty care is not available, or who choose for other reasons to remain in primary care, primary care treatment will be more effective if it is provided within a model of integrated care that includes care management and psychiatric consultation.

(1) General Behavioral Health Integration (BHI)

We recognize that the psychiatric CoCM is prescriptive and that much of its demonstrated success may be attributable to adherence to a set of elements and guidelines of care as described in the preceding paragraphs. Therefore, we are proposing the use of these codes to pay accurately for this specific model of care for the benefit of Medicare beneficiaries, given its wide-spread adoption and recognized effectiveness. However, we note that PFS coding, in general, does not dictate how physicians practice medicine and believe that it should, instead, reflect the practice of medicine. We also recognize that there are primary care practices that are incurring, or may Start Printed Page 46205incur, resource costs inherent to treatment of patients with similar conditions based on other models of BHI that may benefit beneficiaries with behavioral health conditions (see, for example, the approach described at http://www.integration.samhsa.gov/​integrated-care-models.) These models of care include resource costs associated with care managers and consultants that are not accurately characterized by the descriptions in the preceding paragraphs. However, these costs are also not included as direct PE inputs in other PFS services, such as E/M codes. In its comment regarding the psychiatric CoCM, MedPAC noted its preference for beneficiary-centered treatment that would allow for flexibility in addressing patient needs, rather than approaches that are tied to a particular model of care. MedPAC also urged CMS not to make separate payment for each care management activity.

Therefore, to recognize the resource costs associated with furnishing behavioral health care management services to Medicare beneficiaries under related but different models of care without paying for each activity separately, we are also proposing to make payment using a new G-code that describes care management for beneficiaries with diagnosed behavioral health conditions under a broader application of integration in the primary care setting. We believe that for this subset of Medicare beneficiaries, the resources associated with medically necessary care management services are not otherwise adequately reflected under the PFS. The proposed code is GPPPX (Care management services for behavioral health conditions, at least 20 minutes of clinical staff time, directed by a physician or other qualified health care professional time, per calendar month). We note that we expect this coding to be refined over time as we receive more information about other behavioral health care models being used and how they are implemented.

We are seeking stakeholder input on whether we should consider requiring a longer duration of time for this code or an add-on to the code that would allow, for example, additional 20 minute increments. In addition, while we recognize that services inherent to models of BHI provided under this code may range in resource costs, we hope that appropriate payment for these services will lead to appropriate use of BHI models of care, which, in turn, will inform further refinement of the valuation in the future. For additional information on proposed valuation of these codes, see section II.L of this proposed rule.

(2) Initiating Visit for Proposed BHI Codes (GPPP1, GPPP2, GPPP3, and GPPPX)

Similar to CCM services (see section II.E.4), we propose to require an initiating visit for the BHI codes (both the psychiatric CoCM model and the general BHI code), that would be billable separately from the services themselves. We propose that the same services that can serve as the initiating visit for CCM services (see section II.E.3 of this proposed rule) can serve as the initiating visit for the proposed BHI codes. The initiating visit would establish the beneficiary's relationship with the billing practitioner (most aspects of the BHI services would be furnished incident to the billing practitioner's professional services), ensure the billing treating physician or other qualified health care professional assesses the patient prior to initiating other care management processes, and provides an opportunity to obtain beneficiary consent (discussed below). We welcome public comment on the types of services that are appropriate for an initiating visit for the BHI codes, and within what timeframe the initiating visit should be conducted prior to furnishing BHI services.

(3) Beneficiary Consent

Commenters to the CY 2016 PFS proposed rule indicated that they did not believe a specific patient consent for BHI services is necessary and, in fact, that requiring special informed consent for these services may reduce access due to stigma associated with behavioral health conditions. Instead, the commenters recommended requiring a more general consent prior to initiating these services whereby the beneficiary gives the initiating physician or practitioner permission to consult with relevant specialists, which would include conferring with a psychiatric consultant. Accordingly, we propose to require a general beneficiary consent to consult with relevant specialists prior to initiating these services, recognizing that applicable rules continue to apply regarding privacy. The proposed general consent would encompass conferring with a psychiatric consultant when furnishing the psychiatric CoCM codes (GPPP1, GPPP2, and GPPP3) or the broader BHI code (GPPPX). Similar to the proposed beneficiary consent process for CCM services (see section II.E.4 of this proposed rule), we propose that the billing practitioner must document in the beneficiary's medical record that the beneficiary's consent was obtained to consult with relevant specialists including a psychiatric consultant, and that, as part of the consent, the beneficiary is informed that there is beneficiary cost-sharing, including potential deductible and coinsurance amounts, for both in-person and non-face-to-face services that are provided. We welcome stakeholder comments on this proposal.

We recognize that special informed consent can also be helpful in cases when a particular service is limited to being billed by a single practitioner for a particular beneficiary. We do not believe that there are circumstances where it would reasonable for multiple practitioners to be reporting these codes during the same month. However, we are not proposing a formal limit at this time. We are seeking comment on whether such a limitation would be beneficial or whether there are circumstances under which a beneficiary might reasonably receive BHI services from more than one practitioner during a given month.

In recent months, many stakeholders have advised that we should waive the applicable Part B coinsurance for services such as those included in our proposed BHI codes. However, we currently lack statutory authority to waive the coinsurance for services such as these.

4. Reducing Administrative Burden and Improving Payment Accuracy for Chronic Care Management (CCM) Services

Beginning in CY 2015, we implemented separate payment for chronic care management (CCM) services under CPT code 99490 (Chronic care management services, at least 20 minutes of clinical staff time directed by a physician or other qualified health professional, per calendar month, with the following required elements:

  • Multiple (two or more) chronic conditions expected to last at least 12 months, or until the death of the patient;
  • Chronic conditions place the patient at significant risk of death, acute exacerbation/decompensation, or functional decline;
  • Comprehensive care plan established, implemented, revised, or monitored.

We finalized a proposal to make separate payment for CCM services as one initiative in a series of initiatives designed to improve payment for, and encourage long-term investment in, care management services (79 FR 67715). In particular, we sought to address an issue raised to us by the physician community, which asserted that the care management included in many of the existing E/M services, such as office visits, does not adequately describe the Start Printed Page 46206typical non-face-to-face care management work required by certain categories of beneficiaries (78 FR 43337). We began to re-examine how Medicare should pay under the PFS for non-face-to-face care management services that were bundled into the PFS payment for face-to-face E/M visits, being included in the pre- and post-encounter work (78 FR 43337). In proposing separate payment for CCM, we acknowledged that, even though we had previously considered non-face-to-face care management services as bundled into the payment for face-to-face E/M visits, the E/M office/outpatient visit CPT codes may not reflect all the services and resources required to furnish comprehensive, coordinated care management for certain categories of beneficiaries. We stated that we believed that the resources required to furnish complex chronic care management services to beneficiaries with multiple (that is, two or more) chronic conditions were not adequately reflected in the existing E/M codes. Medical practice and patient complexity required physicians, other practitioners and their clinical staff to spend increasing amounts of time and effort managing the care of comorbid beneficiaries outside of face-to-face E/M visits, for example complex and multidisciplinary care modalities that involve regular physician development and/or revision of care plans; subsequent report of patient status; review of laboratory and other studies; communication with other health care professionals not employed in the same practice who are involved in the patient's care; integration of new information into the care plan; and/or adjustments of medical therapy.

Therefore, in the CY 2014 PFS final rule with comment period, we established a separate payment under the PFS for CPT code 99490 (78 FR 43341 through 43342). We sought to include a relatively broad eligible patient population within the code descriptor, established a moderate payment amount, and established bundled payment for concurrently new CPT codes that were reserved for beneficiaries requiring “complex” CCM services (base CPT code 99487 and its add-on code 99489) (79 FR 67716 through 67719). We stated that we would evaluate the services reported under CPT code 99490 to assess whether the service is targeted to the right population and whether the payment amount is appropriate (79 FR 67719). We remind stakeholders that CMS did not limit the eligible population to any particular list of chronic conditions other than the language in the CPT code descriptor. Accordingly, one or more of the chronic conditions being managed through CCM services could be chronic mental health or behavioral health conditions or chronic cognitive disorders, as long as the chronic conditions meet the eligibility language in the CPT code descriptor for CCM services and the billing practitioner meets all of Medicare's requirements to bill the code including comprehensive, patient-centered care planning for all health conditions (see Table 11).

In finalizing separate payment for CPT code 99490, we considered whether we should develop standards to ensure that physicians and other practitioners billing the service would have the capability to fully furnish the service (79 FR 67721). We sought to make certain that the new PFS code(s) would provide beneficiary access to appropriate care management services that are characteristic of advanced primary care, such as patient support for chronic diseases to achieve health goals; 24/7 patient access to care and health information; receipt of preventive care; patient, family and caregiver engagement; and timely coordination of care through electronic health information exchange. Accordingly, we established a set of scope of service elements and payment rules in addition to or in lieu of those established in CPT guidance (in the CPT code descriptor and CPT prefatory language), that the physician or nonphysician practitioner must satisfy to fully furnish CCM services and report CPT code 99490 (78 FR 74414 through 74427, 79 FR 67715 through 67730, and 80 FR 14854). We established requirements to furnish a preceding qualifying visit, obtain advance written beneficiary consent, use certified electronic health record (EHR) technology to furnish certain elements of the service, share the care plan and clinical summaries electronically, document specified activities, and other items summarized in Table 11. For the CCM service elements for which we required use of a certified EHR, the billing practitioner must use, at a minimum, technology meeting the edition(s) of certification criteria that is acceptable for purposes of the EHR Incentive Programs as of December 31st of the calendar year preceding each PFS payment year. (For the CY 2017 PFS payment year, this would mean technology meeting the 2014 edition of certification criteria). These elements and requirements for separately payable CCM services are extensive and generally exceed those required for payment of codes describing procedures, diagnostic tests, or other E/M services under the PFS. In addition, both CPT guidance and our rules specify that only a single practitioner who assumes the care management role for a given beneficiary can bill CPT code 99490 per service period (calendar month). Because the new CCM service closely overlapped with several Medicare demonstration models of advanced primary care (the Multi-Payer Advanced Primary Care Practice (MAPCP) demonstration and the Comprehensive Primary Care Initiative (CPCI)), we provided that practitioners participating in one of these two initiatives could not be paid for CCM services furnished to a beneficiary attributed by the initiative to their practice (79 FR 67729).

Given the non-face-to-face nature of CCM services, we also sought to ensure that beneficiaries would receive advance notice that Part B cost sharing applies since we currently have no legislative authority to “waive” cost sharing for this service. Also since only one practitioner can bill for CCM each service period, we believed the beneficiary notice requirement would help prevent duplicate payment to multiple practitioners.

Since the establishment of CPT code 99490 for separate payment of CCM services, in a number of forums and in public comments to the CY 2016 PFS final rule (80 FR 70921), many practitioners have stated that the service elements and billing requirements are burdensome, redundant and prevent them from being able to provide the services to beneficiaries who could benefit from them. Stakeholders have stated that CPT 99490 is underutilized because it is underpaid relative to the resources involved in furnishing the services, especially given the extensive Medicare rules for payment, and they have suggested a number of potential changes to our current payment rules. Stakeholders continue to believe that many of the CCM payment rules are duplicative of other statutory and regulatory provisions, and to recommend that we reduce the rules and expand CCM coding and payment to distinguish among different levels of patient complexity. We also note that section 103 of the MACRA requires CMS to assess and report to Congress (no later than December 31, 2017) on access to CCM services by underserved rural and racial and ethnic minority populations and to conduct an outreach/education campaign that is underway.

Our assessment of claims data for CY 2015 for CPT code 99490 suggests that Start Printed Page 46207CCM services may indeed be underutilized considering the number of eligible Medicare beneficiaries. Our analysis of Medicare claims data indicates that for CY 2015, approximately 275,000 unique Medicare beneficiaries received the service an average of 3 times each, totaling $37 million in allowed charges. Since CPT code 99490 describes a minimum of 20 minutes of clinical staff time spent furnishing CCM services during a month and does not have a time limit, and since we currently do not separately pay the other codes in the CCM family of CPT codes (which would provide us with utilization data on the number of patients requiring longer service times during a billing period), we do not know how often patients required more than 20 minutes of CCM services per month. We also do not know their relative complexity, other than meeting the acuity criteria in the CPT code descriptor. We also have no way to know the relative complexity of the CCM services furnished to beneficiaries.

In light of this stakeholder feedback and our mandate under MACRA section 103 to encourage and report on access to CCM services, we are proposing several changes in the payment rules for CCM services. Our primary goal and statutory mandate is to pay as accurately as possible for services furnished to Medicare beneficiaries based on the relative resources required to furnish PFS services, including CCM services. In so doing, we also expect to facilitate beneficiaries' access to reasonable and necessary CCM services that improve health outcomes. First, for CY 2017 we are proposing to more appropriately recognize and pay for the other codes in the CPT family of CCM services (CPT codes 99487 and 99489 describing complex CCM), consistent with our general practice to price services according to their relative ranking within a given family of services. We direct the reader to section II.L of this proposed rule for a discussion of proposed valuation for base CPT code 99487 and its add-on CPT code 99489. The CPT code descriptors are:

  • CPT code 99487—Complex chronic care management services, with the following required elements:

++ Multiple (two or more) chronic conditions expected to last at least 12 months, or until the death of the patient;

++ Chronic conditions place the patient at significant risk of death, acute exacerbation/decompensation, or functional decline;

++ Establishment or substantial revision of a comprehensive care plan;

++ Moderate or high complexity medical decision making;

++ 60 minutes of clinical staff time directed by a physician or other qualified health care professional, per calendar month.

  • CPT code 99489—Each additional 30 minutes of clinical staff time directed by a physician or other qualified health care professional, per calendar month (List separately in addition to code for primary procedure).

As CPT provides, less than 60 minutes of clinical staff time in the service period could not be reported separately, and similarly, less than 30 minutes in addition to the first 60 minutes of complex CCM in a service period could not be reported. We would require 60 minutes of services for reporting CPT code 99487 and 30 additional minutes for each unit of CPT code 99489.

We propose to adopt the CPT provision that CPT codes 99487, 99489, 99490 may only be reported once per service period (calendar month) and only by the single practitioner who assumes the care management role with a particular beneficiary for the service period. That is, a given beneficiary would be classified as eligible to receive either complex or non-complex CCM during a given service period (calendar month), not both, and only one professional claim could be submitted to the PFS for CCM for that service period by one practitioner.

Except for differences in the CPT code descriptors, we propose to require the same CCM service elements for CPT codes 99487, 99489 and 99490. In other words, all the requirements in Table 11 would apply whether the code being billed for the service period is CPT code 99487 (plus 99489 if applicable) or CPT code 99490. These three codes would differ in the amount of clinical staff service time provided; the complexity of medical decision-making as defined in the E/M guidelines (determined by the problems addressed by the reporting practitioner during the month); and the nature of care planning that was performed (establishment or substantial revision of the care plan for complex CCM versus establishment, implementation, revision or monitoring of the care plan for non-complex CCM). Billing practitioners could consider identifying beneficiaries who require complex CCM services using criteria suggested in CPT guidance (such as number of illnesses, number of medications or repeat admissions or emergency department visits) or the profile of typical patients in the CPT prefatory language, but these would not comprise Medicare conditions of eligibility for complex CCM.

We are proposing several changes to our current scope of service elements for CCM, and are proposing that the same scope of service elements, as amended, would apply to all codes used to report CCM services beginning in 2017 (i.e., CPT codes 99487, 99489 and 99490). In particular, we are proposing changes in the requirements for the initiating visit, 24/7 access to care and continuity of care, format and sharing of the care plan and clinical summaries, beneficiary receipt of the care plan, beneficiary consent, and documentation. In Table 11, we summarize the current scope of service elements and payment rules for CCM and indicate whether we are proposing to retain, remove or revise each element.

a. Initiating Visit

As provided in the CY 2014 PFS final rule with comment period (78 FR 74425) and subregulatory guidance (available at https://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​PhysicianFeeSched/​Downloads/​Payment_​for_​CCM_​Services_​FAQ.pdf), CCM must be initiated by the billing practitioner during a “comprehensive” E/M visit, annual wellness visit (AWV) or initial preventive physical exam (IPPE). This face-to-face, initiating visit is not part of the CCM service and can be separately billed to the PFS, but is required before CCM services can be provided directly or under other arrangements. The billing practitioner must discuss CCM with the patient at this visit. While informed patient consent does not have to be obtained during this visit, the visit is an opportunity to obtain the required consent. The face-to-face visit included in transitional care management (TCM) services (CPT 99495 and 99496) qualifies as a “comprehensive” visit for CCM initiation. Levels 2 through 5 E/M visits (CPT 99212 through 99215) also qualify; CMS does not require the practice to initiate CCM during a level 4 or 5 E/M visit. However CPT codes that do not involve a face-to-face visit by the billing practitioner or are not separately payable by Medicare (such as CPT 99211, anticoagulant management, online services, telephone and other E/M services) do not qualify as initiating visits. If the practitioner furnishes a “comprehensive” E/M, AWV, or IPPE and does not discuss CCM with the patient at that visit, that visit cannot count as the initiating visit for CCM.

We continue to believe that we should require an initiating visit in advance of furnishing CCM services, separate from the services themselves, because a face-to-face visit establishes the beneficiary's relationship with the billing practitioner Start Printed Page 46208(most aspects of the CCM services are furnished incident to the billing practitioner's professional services). The initiating visit also ensures collection of comprehensive health information to inform the care plan. We continue to believe that the types of face-to-face services that qualify as an initiating visit for CCM are appropriate. We are not proposing to change the kinds of visits that can qualify as initiating CCM visits. However we are proposing to require the initiating visit only for new patients or patients not seen within one year instead of for all beneficiaries receiving CCM services. We believe this will allow practitioners with existing relationships with patients who have been seen relatively recently to initiate CCM services without furnishing a potentially unnecessary E/M visit. We are seeking public comment on whether a period of time shorter than one year would be more appropriate.

We are also proposing for CY 2017 to create a new add-on G-code that would improve payment for visits that qualify as initiating visits for CCM services. The code would be billable for beneficiaries who require extensive face-to-face assessment and care planning by the billing practitioner (as opposed to clinical staff), through an add-on code to the initiating visit, GPPP7 (Comprehensive assessment of and care planning by the physician or other qualified health care professional for patients requiring chronic care management services (billed separately from monthly care management services) (Add-on code, list separately in addition to primary service). We propose that when the billing practitioner initiating CCM personally performs extensive assessment and care planning outside of the usual effort described by the billed E/M code (or AWV or IPPE code), the practitioner could bill GPPP7 in addition to the E/M code for the initiating visit (or in addition to the AWV or IPPE), and in addition to the CCM CPT code 99490 (or proposed 99487 and 99489) if all requirements to bill for CCM services are also met. See section II.L for proposed valuation of GPPP7.

The code GPPP7 would account specifically for additional work of the billing practitioner in personally performing a face-to-face assessment of a beneficiary requiring CCM services, and personally performing CCM care planning (the care planning could be face-to-face and/or non-face-to-face) that is not already reflected in the initiating visit itself (nor in the monthly CCM service code). We believe GPPP7 might be particularly appropriate to bill when the initiating visit is a less complex visit (such as a level 2 or 3 E/M visit), although GPPP7 could be billed along with higher level visits if the billing practitioner's effort and time exceeded the usual effort described by the initiating visit code. It could also be appropriate to bill GPPP7 when the initiating visit addresses problems unrelated to CCM, and the billing practitioner does not consider the CCM-related work he or she performs in determining what level of initiating visit to bill. We believe that this proposal will more appropriately recognize the relative resource costs for the work of the billing practitioner in initiating CCM services, specifically for extensive work assessing the beneficiary and establishing the CCM care plan that is reasonable and necessary, and that is not accounted for in the billed initiating visit or in the unit of the CCM service itself that is billed for a given service period. In addition, we believe this proposal will help ensure that the billing practitioner personally performs and meaningfully contributes to the establishment of the CCM care plan when the patient's complexity warrants it.

Consistent with general coding guidance, the work that is reported under GPPP7 (including time) could not also be reported under or counted towards the reporting of any other billed code, including any of the monthly CCM services codes. The care plan that the practitioner must create in order to bill GPPP7 would be subject to the same requirements as the care plan included in the monthly CCM services, namely it must be an electronic patient-centered care plan based on a physical, mental, cognitive, psychosocial, functional and environmental (re)assessment and an inventory of resources and supports; a comprehensive care plan for all health issues. This would distinguish it from the more limited care plan included in the BHI codes GPPP1, GPPP2, GPPP3 or GPPPX which focus on behavioral health issues, or the care plan included in GPPP6 which focuses on cognitive status. We are seeking public input on potential overlap among these codes and further clinical input as to how the assessments and care planning that is included in them would differ.

Finally, although not part of our proposals for 2017, we have noted with interest a recent CPT coding proposal for a code that would potentially identify and separately pay for monthly CCM work that is personally performed by the billing physician or other practitioner. We will continue to follow any CPT developments in this area.

b. 24/7 Access to Care and Continuity of Care

We propose several revisions to the scope of service elements of 24/7 Access to care and Continuity of Care. We continue to believe these elements are important aspects of CCM services, but that it would be appropriate to improve alignment with CPT provisions and remove the requirement for the care plan to be available remotely to individuals providing CCM services after hours. Studies have shown that after-hours care is best implemented as part of a larger practice approach to access and continuity (see for example, the peer-review article available at http://www.ncbi.nlm.nih.gov/​pmc/​articles/​PMC3475839/​). There is substantial local variation in how 24/7 access and continuity of care are achieved, depending on the contractual relationships among practitioners and providers in a particular geographic area and other factors. Care models include various contractual relationships between physician practices and after-hours clinics, urgent care centers and emergency departments; extended primary care office hours; physician call-sharing; telephone triage systems; and health information technology such as shared EHRs and systematic notification procedures (http://www.ncbi.nlm.nih.gov/​pmc/​articles/​PMC3475839/​). Some or all of these may be used to provide access to urgent care on a 24/7 basis while maintaining information continuity between providers.

We recognize that some models of care require more significant investment in practice infrastructure than others, for example resources in staffing or health information technology. In addition, we believe there is room to reduce the administrative complexity of our current payment rules for CCM services to accommodate a range of potential care models. In re-examining what should be included in the CCM scope of service elements for 24/7 Access to Care and Continuity of Care, we believe the CPT language adequately and more appropriately describes the services that should, at a minimum, be included in these service elements. Therefore, we propose to adopt the CPT language for these two elements. For 24/7 Access to Care, the scope of service element would be to provide 24/7 access to physicians or other qualified health care professionals or clinical staff including providing patients/caregivers with a means to make contact with health care professionals in the practice to address urgent needs regardless of the time of day or day of week. We believe Start Printed Page 46209the CPT language more accurately reflects the potential role of clinical staff or call-sharing services in addressing after-hours care needs than our current language does. In addition, the 24/7 access would be for “urgent” needs rather than “urgent chronic care needs,” because we believe after-hours services typically would and should address any urgent needs and not only those explicitly related to the beneficiary's chronic conditions.

We recognize that health information systems that include remote access to the care plan or the full EHR after hours, or a feedback loop that communicates back to the primary care physician and others involved in the beneficiary's care regarding after-hours care or advice provided, are extremely helpful (http://www.ncbi.nlm.nih.gov/​pmc/​articles/​PMC3475839/​#CR25). They help ensure that the beneficiary receives necessary follow up, particularly if he or she is referred to the emergency department, and follow up after an emergency department visit is required under the CCM element of Management of Care Transitions. Accordingly, we continue to support and encourage the use of interoperable EHRs or remote access to the care plan in providing the CCM service elements of 24/7 Access to Care, Continuity of Care, and Management of Care Transitions. However, adoption of such technology would be optimal not only for CCM services, but also for a number of other PFS services and procedures (including various other care management services), and we have not required adoption of any certified or non-certified health information technology as a condition of payment for any other PFS service. We note that there are incentives under other Medicare programs to adopt such information technology, and are concerned that imposing EHR-related requirements at the service level as a condition of PFS payment could create disparities between these services and others under the fee schedule. Lastly, we recognize that not all after-hours care warrants follow-up or a feedback loop with the practitioner managing the beneficiary's care overall, and that under particular circumstances feedback loops can be achieved through oral, telephone or other less sophisticated communication methods. Therefore at this time, we propose to remove the requirement that the individuals providing CCM after hours must have access to the electronic care plan. This proposal reflects our understanding that flexibility in how practices can provide the requisite 24/7 access to care, as well as continuity of care and management of care transitions, for their CCM patients can facilitate appropriate access to these services for Medicare beneficiaries. This proposal is not intended to undermine the significance of standardized communication methods as part of effective care. Instead, we recognize that other CMS initiatives may be better mechanisms to incentivize increased interoperability of health information systems than conditions of payment assigned to particular services under the PFS. We also anticipate that improved accuracy of payment for care management services and reduced administrative burden associated with billing for them will contribute to practitioners' capacity to invest in the best tools for managing the care of Medicare beneficiaries.

For Continuity of Care, we currently require the ability to obtain successive routine appointments “with the practitioner or a designated member of the care team,” while CPT only references successive routine appointments “with a designated member of the care team.” We do not believe there is any practical difference between these two phrases and therefore are proposing to omit the words “practitioner or” from our requirement. The billing practitioner is a member of the CCM care team, so the CPT language already allows for successive routine appointments either with the billing practitioner or another appropriate member of the CCM care team.

c. Electronic Care Plan

Based on review of extensive public comment and stakeholder feedback, we have come to believe that we should not require individuals providing the beneficiary with the required 24/7 access to care for urgent needs to have access to the care plan as a condition of CCM payment. As discussed above, we believe that in general, provision of effective after-hours care of the beneficiary would require access to the care plan, if not the full EHR. However, we have heard from rural and other practices that remote access to the care plan is not always necessary or possible because urgent care needs after-hours are often referred to a practitioner or care team member who established the care plan or is familiar with the beneficiary. In some instances, the care plan does not need to be available in order to address urgent patient needs after business hours. In addition, we have not required the use of any certified or non-certified health information technology in the provision of any other PFS services (including various other care management services). We are concerned that imposing EHR-related requirements at the service level as a condition of PFS payment could distort the relative valuation of services priced under the fee schedule. Therefore, we propose to change the CCM service element to require timely electronic sharing of care plan information within and outside the billing practice, but not necessarily on a 24/7 basis, and to allow transmission of the care plan by fax.

We acknowledge that it is best for practitioners and providers to have access to care plan information any time they are providing services to beneficiaries who require CCM services. This proposal is not intended to undermine the significance of electronic communication methods other than fax transmission in providing effective, continuous care. On the contrary, we believe that fax transmission, while commonly used, is much less efficient and secure than other methods of communicating patient health information, and we encourage practitioners to adopt and use electronic technologies other than fax for transmission and exchange of the CCM care plan. We continue to believe the best means of exchange of all relevant patient health information is through standardized electronic means. However, we recognize that other CMS initiatives may be better mechanisms to incentivize increased interoperability of health information systems than conditions of payment assigned to particular services under the PFS. We believe our proposal would still allow timely availability of health information within and outside the practice for purposes of providing CCM, and would simplify the rules governing provision of the service and improve access to the service. These proposed revisions would better align the service with appropriate CPT prefatory language, which may reduce unnecessary administrative complexity for practitioners in navigating the differences between CPT guidance and Medicare rules.

d. Clinical Summaries

The CCM scope of service element Management of Care Transitions includes a requirement for the creation and electronic transmission and exchange of continuity of care documents referred to as “clinical summaries” (see Table 11). We patterned our requirements regarding clinical summaries after the EHR Incentive Program requirement that an eligible professional who transitions their patient to another setting of care or provider of care, or refers their patient to another provider of care, should Start Printed Page 46210provide a summary care record for each transition of care or referral. This clinical summary includes demographics, the medication list, medication allergy list, problem list, and a number of other data elements if the practitioner knows them. As a condition of CCM payment, we required standardized content for clinical summaries (that they must be created/formatted according to certified EHR technology). For the exchange/transport function, we did not require the use of a specific tool or service to exchange/transmit clinical summaries, as long as they are transmitted electronically (this can include fax only when the receiving practitioner or provider can only receive by fax).

Based on review of extensive public comment and stakeholder feedback, we have come to believe that we should not require the use of any specific electronic technology in managing a beneficiary's care transitions as a condition of payment for CCM services. Instead we are proposing more simply to require the billing practitioner to create and exchange/transmit continuity of care document(s) timely with other practitioners and providers. To avoid confusion with the requirements of the EHR Incentive Programs, and since we would no longer require standardized content for the CCM continuity of care document(s), we would refer to them as continuity of care documents instead of clinical summaries. We would no longer specify how the billing practitioner must transport or exchange these document(s), as long as it is done timely and consistent with the Care Transitions Management scope of service element. We welcome public input on how we should refer to these document(s), noting that CPT does not provide model language specific to CCM services. The proposed term “continuity of care document(s)” draws on CPT prefatory language for TCM services, which CPT provides may include “obtaining and reviewing the discharge information (for example, discharge summary, as available, or continuity of care document).”

Again, this proposal is not intended to undermine the significance of a standardized, electronic format and means of exchange (other than fax) of all relevant patient health information, for achieving timely, seamless care across settings especially after discharge from a facility. On the contrary, we believe that fax transmission, while commonly used, is much less efficient and secure than other methods of communicating patient health information, and we encourage practitioners to adopt and use electronic technologies other than fax for transmission and exchange of continuity of care documents in providing CCM services. We continue to believe the best means of exchange of all relevant patient health information is through standardized electronic means. However, as we discussed above regarding the CCM care plan, we have not applied similar requirements to other PFS services specifically (including various other care management services) and have concerns about how doing so may create disparities between these services and others under the PFS. We also recognize that other CMS initiatives may be better mechanisms to incentivize increased interoperability of health information systems than conditions of payment assigned to particular services under the PFS. However, we also anticipate that our proposals will contribute to practitioners' capacity to invest in the best tools for managing the care of Medicare beneficiaries.

e. Beneficiary Receipt of Care Plan

We propose to simplify the current requirement to provide the beneficiary with a written or electronic copy of the care plan, by instead adopting the CPT language specifying more simply that a copy of the care plan must be given to the patient or caregiver. While we believe beneficiaries should and must be provided a copy of the care plan, and that practitioners may choose to provide the care plan in hard copy or electronic form in accordance with patient preferences, we do not believe it is necessary to specify the format of the care plan that must be provided as a condition of CCM payment. Additionally, we recognize that there may be times that sharing the care plan with the caregiver (in a manner consistent with applicable privacy and security rules and regulations) may be appropriate.

f. Beneficiary Consent

We continue to believe that obtaining advance beneficiary consent to receive CCM services is important to ensure the beneficiary is informed, educated about CCM services, and is aware of applicable cost sharing. We also believe that querying the beneficiary about whether another practitioner is already providing CCM services helps to reduce the potential for duplicate provision or billing of the services. However, we believe the consent process could be simplified, and that it should be left to the practitioner and the beneficiary to decide the best way to establish consent. Therefore, we propose to continue to require billing practitioners to inform the beneficiary of the currently required information (that is, inform the beneficiary of the availability of CCM services; inform the beneficiary that only one practitioner can furnish and be paid for these services during a calendar month; and inform the beneficiary of the right to stop the CCM services at any time (effective at the end of the calendar month)). However, we propose to specify that the practitioner could document in the beneficiary's medical record that this information was explained and note whether the beneficiary accepted or declined CCM services instead of obtaining a written agreement.

We also propose to remove the language requiring beneficiary authorization for the electronic communication of his or her medical information with other treating providers as a condition of payment for CCM services, because under the Health Insurance Portability and Accountability Act (HIPAA) Privacy Rule (45 CFR 164.506), a covered entity is permitted to use or disclose protected health information for purposes of treatment without patient authorization. Moreover, if such disclosure is electronic, the HIPAA Security Rule requires secure transmission (45 CFR 164.312(e)). In previous regulations we have reminded practitioners that for all electronic sharing of beneficiary information in the provision of CCM services, HIPAA Privacy and Security Rule standards apply in the usual manner (79 FR 67728).

g. Documentation

We have heard from practitioners that the requirements to document certain information in a certified EHR format are redundant because the CCM billing rules already require documentation of core clinical information in a certified EHR format. Specifically, we already require structured recording of demographics, problems, medications and medication allergies, and the creation of a clinical summary record, using a qualifying certified EHR; and that a full list of problems, medications and medication allergies in the EHR must inform the care plan, care coordination and ongoing clinical care. Therefore, we propose to no longer require the use of a qualifying certified EHR to document communication to and from home- and community-based providers regarding the patient's psychosocial needs and functional deficits and to document beneficiary consent. We would continue to require documentation in the medical record of beneficiary consent (discussed above) and of communication to and from home- and community-based providers Start Printed Page 46211regarding the patient's psychosocial needs and functional deficits.

In summary, we believe our proposed changes would retain elements of the CCM service that are most characteristic of the changes in medical practice toward advanced primary care, while eliminating redundancy, simplifying provision of the services, and improving access without compromising quality of care and beneficiary privacy or advance notice and consent. We also anticipate that improved accuracy of payment for care management services and reduced administrative burden associated with billing for these services will contribute to practitioners' capacity to invest in the best tools for managing the care of Medicare beneficiaries.

g. CCM Requirements for Rural Health Clinics (RHCs) and Federally Qualified Health Centers (FQHCs)

RHCs and FQHCs have been authorized to bill for CCM services since January 1, 2016, and are paid based on the Medicare PFS national average non-facility payment rate when CPT code 99490 is billed alone or with other payable services on a RHC or FQHC claim. The RHC and FQHC requirements for billing CCM services have generally followed the requirements for practitioners billing under the PFS, with some adaptations based on the RHC and FQHC payment methodologies.

To assure that CCM requirements for RHCs and FQHCs are not more burdensome than those for practitioners billing under the PFS, we are proposing revisions for CCM services furnished by RHCs and FQHCs similar to the revisions proposed under the section above entitled, “Reducing Administrative Burden and Improving Payment Accuracy for Chronic Care Management (CCM) Services” for RHCs and FQHCs. Specifically, we propose to:

  • Require that CCM be initiated during an AWV, IPPE, or comprehensive E/M visit only for new patients or patients not seen within one year. This would replace the requirement that CCM could only be initiated during an AWV, IPPE, or comprehensive E/M visit where CCM services were discussed.
  • Require 24/7 access to a RHC or FQHC practitioner or auxiliary staff with a means to make contact with a RHC or FQHC practitioner to address urgent health care needs regardless of the time of day or day of week. This would replace the requirement that CCM services be available 24/7 with health care practitioners in the RHC or FQHC who have access to the patient's electronic care plan to address his or her urgent chronic care needs, regardless of the time of day or day of the week.
  • Require timely electronic sharing of care plan information within and outside the RHC or FQHC, but not necessarily on a 24/7 basis, and allow transmission of the care plan by fax. This would replace the requirement that the electronic care plan be available on a 24/7 basis to all practitioners within the RHC or FQHC whose time counts towards the time requirement for the practice to bill the CCM code, and removes the restriction on allowing the care plan to be faxed.
  • Require that in managing care transitions, the RHC or FQHC creates, exchanges, and transmits continuity of care document(s) in a timely manner with other practitioners and providers. This would replace the requirements that clinical summaries must be created and formatted according to certified EHR technology, and the requirement for electronic exchange of clinical summaries by a means other than fax.
  • Require that a copy of the care plan be given to the patient or caregiver. This would remove the description of the format (written or electronic) and allows the care plan to be provided to the caregiver when appropriate (and in a manner consistent with applicable privacy and security rules and regulations).
  • Require that the RHC or FQHC practitioner documents in the beneficiary's medical record that all the elements of beneficiary consent (for example, that the beneficiary was informed of the availability of CCM services; only one practitioner can furnish and be paid for these services during a calendar month; the beneficiary may stop the CCM services at any time, effective at the end of the calendar month, etc.) were provided, and whether the beneficiary accepted or declined CCM services. This would replace the requirement that RHCs and FQHCs obtain a written agreement that these elements were discussed, and removes the requirement that the beneficiary provide authorization for the electronic communication of his or her medical information with other treating providers as a condition of payment for CCM services.
  • Require that communication to and from home- and community-based providers regarding the patient's psychosocial needs and functional deficits be documented in the patient's medical record. This would replace the requirement to document this patient health information in a certified EHR format.

We note that we are not proposing an additional payment adjustment for patients who require extensive assessment and care planning as part of the initiating visit, as payments for RHC and FQHC services are not adjusted for length or complexity of the visit.

We believe these proposed changes would keep the CCM requirements for RHCs and FQHCs consistent with the CCM requirements for practitioners billing under the PFS, simplify the provision of CCM services by RHCs and FQHCs, and improve access to these services without compromising quality of care, beneficiary privacy, or advance notice and consent.

Table 11—Chronic Care Management (CCM) Scope of Service Elements and Billing Requirements

CCM Scope of service element/billing requirementPropose to retainPropose to removeProposed revision
Initiating Visit—Initiation during an AWV, IPPE, or face-to-face E/M visit for all patients (Level 4 or 5 visit not required)Initiation during an AWV, IPPE, or face-to-face E/M visit (Level 4 or 5 visit not required) for new patients or patients not seen within 1 year.
Structured Recording of Patient Information Using Certified EHR Technology— Structured recording of demographics, problems, medications, medication allergies, and the creation of a structured clinical summary record, using certified EHR technology. A full list of problems, medications and medication allergies in the EHR must inform the care plan, care coordination and ongoing clinical careStructured Recording of Patient Information Using Certified EHR Technology— Structured recording of demographics, problems, medications and medication allergies using certified EHR technology. A full list of problems, medications and medication allergies in the EHR must inform the care plan, care coordination and ongoing clinical care.
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24/7 Access to Care—Access to care management services 24/7 (providing the beneficiary with a means to make timely contact with health care practitioners in the practice who have access to the patient's electronic care plan to address his or her urgent chronic care needs regardless of the time of day or day of the week)Provide 24/7 access to physicians or other qualified health professionals or clinical staff including providing patients/caregivers with a means to make contact with health care professionals in the practice to address urgent needs regardless of the time of day or day of week.
Continuity of Care—Continuity of care with a designated practitioner or member of the care team with whom the beneficiary is able to get successive routine appointmentsContinuity of care with a designated member of the care team with whom the beneficiary is able to schedule successive routine appointments.
Comprehensive Care Management—Care management for chronic conditions including systematic assessment of the beneficiary's medical, functional, and psychosocial needs; system-based approaches to ensure timely receipt of all recommended preventive care services; medication reconciliation with review of adherence and potential interactions; and oversight of beneficiary self-management of medicationsX
Electronic Comprehensive Care Plan—Creation of an electronic patient-centered care plan based on a physical, mental, cognitive, psychosocial, functional and environmental (re)assessment and an inventory of resources and supports; a comprehensive care plan for all health issuesX
Electronic Sharing of Care Plan—Must at least electronically capture care plan information; make this information available on a 24/7 basis to all practitioners within the practice whose time counts towards the time requirement for the practice to bill the CCM code; and share care plan information electronically (by fax in extenuating circumstance) as appropriate with other practitioners and providersMust at least electronically capture care plan information, and make this information available timely within and outside the billing practice as appropriate. Share care plan information electronically (can include fax) and timely within and outside the billing practice to individuals involved in the beneficiary's care.
Beneficiary Receipt of Care Plan—Provide the beneficiary with a written or electronic copy of the care planA copy of the plan of care must be given to the patient or caregiver.
Documentation of care plan provision to beneficiary— Document provision of the care plan as required to the beneficiary using certified EHR technologyX
Management of Care Transitions • Management of care transitions between and among health care providers and settings, including referrals to other clinicians; follow-up after an emergency department visit; and follow-up after discharges from hospitals, skilled nursing facilities or other health care facilities • Format clinical summaries according to certified EHR technology (content standard) • Not required to use a specific tool or service to exchange/transmit clinical summaries, as long as they are transmitted electronically (by fax in extenuating circumstance)Management of Care Transitions • Management of care transitions between and among health care providers and settings, including referrals to other clinicians; follow-up after an emergency department visit; and follow-up after discharges from hospitals, skilled nursing facilities or other health care facilities. • Create and exchange/transmit continuity of care document(s) timely with other practitioners and providers.
Home- and Community-Based Care Coordination— Coordination with home and community based clinical service providersX
Documentation of Home- and Community-Based Care Coordination—Communication to and from home- and community-based providers regarding the patient's psychosocial needs and functional deficits must be documented in the patient's medical record using certified EHR technologyCommunication to and from home- and community-based providers regarding the patient's psychosocial needs and functional deficits must be documented in the patient's medical record.
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Enhanced Communication Opportunities—Enhanced opportunities for the beneficiary and any caregiver to communicate with the practitioner regarding the beneficiary's care through not only telephone access, but also through the use of secure messaging, Internet, or other asynchronous non-face-to-face consultation methodsX
Beneficiary Consent— • Inform the beneficiary of the availability of CCM services and obtain his or her written agreement to have the services provided, including authorization for the electronic communication of his or her medical information with other treating providers • Inform the beneficiary of the right to stop the CCM services at any time (effective at the end of the calendar month) and the effect of a revocation of the agreement on CCM services • Inform the beneficiary that only one practitioner can furnish and be paid for these services during a calendar month • Document the beneficiary's written consent and authorization using certified EHR technology• Inform the beneficiary of the availability of CCM services. • Inform the beneficiary that only one practitioner can furnish and be paid for these services during a calendar month. • Inform the beneficiary of the right to stop the CCM services at any time (effective at the end of the calendar month). • Document in the beneficiary's medical record that the required information was explained and whether the beneficiary accepted or declined the services.

5. Assessment and Care Planning for Patients With Cognitive Impairment

For CY 2017 we are proposing a G-code that would provide separate payment to recognize the work of a physician (or other appropriate billing practitioner) in assessing and creating a care plan for beneficiaries with cognitive impairment, GPPP6 (Cognition and functional assessment using standardized instruments with development of recorded care plan for the patient with cognitive impairment, history obtained from patient and/or caregiver, in office or other outpatient setting or home or domiciliary or rest home). We understand that a similar code was recently approved by the CPT Editorial Panel and is scheduled to be included in the CY 2018 CPT code set. We intend for GPPP6 to be a temporary code (perhaps for only one-year) and will consider whether to adopt and establish relative value units for the new CPT code under our standard process, presumably for CY 2018.

We reviewed the list of service elements that were proposed at CPT, and are proposing the following as required service elements of GPPP6:

  • Cognition-focused evaluation including a pertinent history and examination.
  • Medical decision making of moderate or high complexity (defined by the E/M guidelines).
  • Functional assessment (for example, Basic and Instrumental Activities of Daily Living), including decision-making capacity.
  • Use of standardized instruments to stage dementia.
  • Medication reconciliation and review for high-risk medications, if applicable.
  • Evaluation for neuropsychiatric and behavioral symptoms, including depression, including use of standardized instrument(s).
  • Evaluation of safety (for example, home), including motor vehicle operation, if applicable.
  • Identification of caregiver(s), caregiver knowledge, caregiver needs, social supports, and the willingness of caregiver to take on caregiving tasks.
  • Advance care planning and addressing palliative care needs, if applicable and consistent with beneficiary preference.
  • Creation of a care plan, including initial plans to address any neuropsychiatric symptoms and referral to community resources as needed (for example, adult day programs, support groups); care plan shared with the patient and/or caregiver with initial education and support.

The proposed valuation of GPPP6 (discussed in section II.E.1) assumes that this code would include services that are personally performed by the physician (or other appropriate billing practitioner) and would significantly overlap with services described by certain E/M visit codes, advance care planning services, and certain psychological or psychiatric service codes that are currently separately payable under the PFS. Accordingly, we propose that GPPP6 must be furnished by the physician (or other appropriate billing practitioner) and could not be billed on the same date of service as CPT codes 90785 (Psytx complex interactive), 90791 (Psych diagnostic evaluation), 90792 (Psych diag eval w/med srvcs), 96103 (Psycho testing admin by comp), 96120 (Neuropsych tst admin w/comp), 96127 (Brief emotional/behav assmt), 99201-99215 (Office/outpatient visits new), 99324-99337 (Domicil/r-home visits new pat), 99341-99350 (Home visits new patient), 99366-99368 (Team conf w/pat by hc prof), 99497 (Advncd care plan 30 min), 99498 (Advncd care plan addl 30 min)), since these codes all reflect face-to-face services provided by the physician or other billing practitioner for related services that are separately payable. In addition, we are proposing to prohibit billing of GPPP6 with other care planning services, such as care plan oversight services (CPT code 99374), home health care and hospice supervision (G0181, G0182), or our proposed add-on code for comprehensive assessment and care planning by the billing practitioner for patients requiring CCM services (GPPP7). We are seeking comment on whether there are circumstances where multiple care planning codes could be furnished without significant overlap. We propose to specify that GPPP6 may serve as a companion or primary E/M code to the prolonged service codes (those that are currently separately paid, and those we propose to separately pay beginning in 2017), but are interested in Start Printed Page 46214public input on whether there is any overlap among these services. We are seeking comment on how to best delineate the post-service work for GPPP6 from the work necessary to provide the prolonged services code.

We do not believe the services described by GPPP6 would significantly overlap with proposed or current medically necessary CCM services (CPT codes 99487, 99489, 99490); TCM services (99495, 99496); or the proposed behavioral health integration service codes (GPPP1, GPPP2, GPPP3, GPPPX). Therefore we propose that GPPP6 could be billed on the same date-of-service or within the same service period as these codes (CPT codes 99487, 99489, 99490, 99495, 99496, GPPP1, GPPP2, GPPP3, GPPPX). There may be overlap in the patient population eligible to receive these services and the population eligible to receive the services described by GPPP6, but we believe there would be sufficient differences in the nature and extent of the assessments, interventions and care planning, as well as the qualifications of individuals providing the services, to allow concurrent billing for services that are medically reasonable and necessary. We welcome public comment on potential overlap between GPPP6 and existing PFS billing codes, as well as the other primary care/cognitive services addressed in this section of the proposed rule.

6. Improving Payment Accuracy for Care of People With Disabilities

a. Background

People with disabilities face significant challenges accessing the health care system. Medicare beneficiaries who are under age 65 with disabilities are three times more likely to report having difficulties finding a doctor who accepts Medicare than beneficiaries age 65 and older.[4] When able to find a Medicare participating physician, people with disabilities report worse experiences than people without disabilities on many quality measures, including those related to patient-centered care and patient safety based on data from the National Healthcare Disparities Report, produced by the Agency for Healthcare Research and Quality (AHRQ).[5] The reasons for these access and quality disparities are multifaceted and may include a range of payment challenges, accessibility issues with equipment and facilities, communication obstacles, and sometimes lack of practitioner understanding of how to assess and fully address the needs and preferences of people with disabilities. The Equity Plan for Improving Quality in Medicare, released last fall by CMS, highlights many challenges in achieving better outcomes for people with disabilities.

One way to help improve access to high-quality physicians' services for people with disabilities is to ensure Medicare Physician Fee Schedule payments are based on the accurate relative resource costs of services furnished to people with disabilities.

As described in section I.B. of this proposed rule, PFS payments are required to be based on the relative resources involved in furnishing a service. To determine the relative resources required to furnish a service described by a specific HCPCS code, CMS considers the “typical” Medicare service described by that code, and identifies the resources involved in that scenario. This approach assumes that while practitioners might incur greater or fewer costs in furnishing any specific service to any particular beneficiary, RVUs are allocated appropriately based on a “typical” Medicare case-mix.

For HCPCS codes that describe narrowly-defined procedures and tests, PFS payment rates based on the typical resources may be accurate for most kinds of practitioners and many beneficiaries, because the granularity of coding corresponds with practitioners' use of resources based on the specific medical needs of their patients. However, the HCPCS codes that describe the office/outpatient E/M services are broadly defined, so the typical service billed using one of those HCPCS codes matches a much smaller percentage of all the services billed using that HCPCS code. Medicare payment rates for these kinds of services under the PFS do not vary by the population being served, or by the particular practitioner furnishing the services. Payment for these kinds of service vary only based on the delineations among the level of visits, despite the reality that adequately serving certain patients requires much greater resources in ways that are generally not reflected in the described differentiation between visit levels.

For example, the same codes and rates are used to pay for routine care of all patients, including furnishing care to patients with disabilities that often require greater resources relating to equipment, clinical staff, and physician time relative to the resource costs associated with providing the same kind of care to other Medicare beneficiaries. Thus, the payment rate for the code may not accurately reflect the resources involved in providing the service to certain categories of beneficiaries. For these reasons, the resources involved in furnishing care, including and especially routine care of both acute and chronic illness, to beneficiaries with disabilities may be routinely and systematically underestimated under PFS payment made on the basis of the broadly described visit codes. This effectively reduces overall payment relative to resource needs for practitioners who more frequently serve such patients, which could negatively impact access or quality of care for beneficiaries with disabilities.

b. Establishing a HCPCS G-Code To Improve Payment Accuracy for Care of People With Mobility-Related Disabilities

We estimate that about 7 percent of all Medicare beneficiaries have a potentially disabling mobility-related diagnosis (the Medicare-only prevalence is 5.5 percent and the prevalence for Medicare-Medicaid dual eligible beneficiaries is 11 percent), using 2010 Medicare (and for dual eligible beneficiaries, Medicaid) claims data.

When a beneficiary with a mobility-related disability goes to a physician or other practitioner's office for an E/M visit, the resources associated with providing the visit can exceed the resources required for the typical E/M visit. An E/M visit for a patient with a mobility-related disability can require more physician and clinical staff time to provide appropriate care because the patient may require skilled assistance throughout the visit to carefully move and adjust his/her body. Furthermore, an E/M visit for a patient with a mobility-related disability commonly requires specialized equipment such as a wheel chair accessible scale, floor and overhead lifts, a movable exam table, padded leg supports, a stretcher and transfer board. The current E/M visit payment rates, based on an assumption of “typical” resources involved in furnishing an E/M visit to a “typical” patient, do not accurately reflect these additional resources associated with furnishing appropriate care to many beneficiaries with mobility-related disabilities.

When furnishing E/M services to beneficiaries with mobility-related Start Printed Page 46215disabilities, practitioners face difficult choices in deciding whether to take the extra time necessary and invest in the required specialized equipment for these visits even though the payment rate for the service does not account for either expense; potentially providing less than optimal care for a beneficiary whose needs exceed the standard appointment block of time in the standard equipped exam room reflected in the current E/M visit payment rate; or declining to accept appointments altogether for beneficiaries who require additional time and specialized equipment.

Each of these scenarios is potentially problematic. The first two scenarios suggest that the quality of care for this beneficiary population might be compromised by assumptions under the PFS regarding relative resource costs in furnishing services to this population. The third scenario reflects an obvious access problem for these beneficiaries. To improve payment accuracy and help ameliorate potential disparity in access and quality for beneficiaries with mobility-related disabilities, we propose to create a new add-on G-code, effective for CY 2017, to describe the additional services furnished in conjunction with E/M services to beneficiaries with disabilities that impair their mobility:

  • GDDD1: Resource-intensive services for patients for whom the use of specialized mobility-assistive technology (such as adjustable height chairs or tables, patient lifts, and adjustable padded leg supports) is medically necessary and used during the provision of an office/outpatient evaluation and management service visit (Add-on code, list separately in addition to primary procedure).

Effective January 1, 2017, we propose that this add-on code could be billed with new and established patient office/outpatient E/M codes (CPT codes 99201 through 99205, and 99212 through 99215), as well as transitional care management codes (CPT codes 99495 and 99496), when the additional resources described by the code are medically necessary and used in the provision of care. In addition to seeking comment on this proposal, we are also seeking comment on other HCPCS codes that may be appropriate base codes for this proposed add-on code, including those describing preventive visits and services. We remind potential commenters that the rationale for this proposal is based in large part on the broad use and lack of granularity in coding for E/M services relative to other PFS services in conjunction with the additional resources used.

The proposed inputs and valuation for this code are detailed in section II.L of this proposed rule.

c. Soliciting Comment on Other Coding Changes To Improve Payment Accuracy for Care of People With Disabilities

When furnishing care to a beneficiary with a mobility-related disability, the current E/M visit payment rates may not fully reflect the associated resource costs that are being incurred by practitioners. We recognize that there are other populations for which payment adjustment may be appropriate. Our proposal regarding beneficiaries with mobility-related disabilities reflects the discrete nature of the additional resource costs for this population, the clear lack of differentiation in resource costs regarding particular kinds of frequently-furnished services, and the broad recognition of access problems. We recognize that some physician practices may frequently furnish services to particular populations for which the relative resource costs are similarly systemically undervalued and we seek comment regarding other circumstances where these dynamics can be discretely observed.

7. Supervision for Requirements for Non-Face-to-Face Care Management Services

Our current regulations in § 410.26(b) provide for an exception to allow general supervision of CCM services (and similarly, for the non-face-to-face portion of TCM services), because these are non-face-to-face care management/care coordination services that would commonly be provided by clinical staff when the billing practitioner, and hence, the supervising physician, is not physically present; and the CPT codes are comprised solely (or largely) of non-face-to-face services provided by clinical staff. A number of codes that we are proposing to establish for separate payment in CY 2017 under our initiative to improve payment accuracy for primary care and care management are similar to CCM services in that a critical element of the services is non-face-to-face care management/care coordination services provided by clinical staff when the billing practitioner may not be physically present. Accordingly, we are proposing to amend § 410.26(a)(3) and § 410.26 (b) to better define general supervision and to allow general supervision not only for CCM services and the non-face-to-face portion of TCM services, but also for proposed codes GPPP1, GPPP2, GPPP3, GPPPX, CPT code 99487, and CPT code 99489. Instead of adding each of these proposed codes requiring general supervision to the regulation text on an individual basis, we propose to revise our regulation under paragraph (b)(1) of § 410.26 to allow general supervision of the non-face-to-face portion of designated care management services, and we would designate the applicable services through notice and comment rulemaking.

F. Improving Payment Accuracy for Services: Diabetes Self-Management Training (DSMT)

Section 1861(s)(2)(S) of the Act specifies that medical and other health services include DSMT services as defined in section 1861(qq) of the Act. DSMT services are intended to educate beneficiaries in the successful self-management of diabetes. DSMT includes, as applicable, instructions in self-monitoring of blood glucose; education about diet and exercise; an insulin treatment plan developed specifically for the patient who is insulin-dependent; and motivation for patients to use the new skills for self-management (see § 410.144(a)(5)). DSMT services are reported under HCPCS codes G0108 (Diabetes outpatient self-management training services, individual, per 30 minutes) and G0109 (Diabetes outpatient self- management training services, group session (2 or more), per 30 minutes). The benefit, as specified at § 410.141, consists of 1 hour of individual and 9 hours of group training unless special circumstances warrant more individual training or no group session is available within 2 months of the date the training is ordered.

Section 1861(qq) of the Act specifies that DMST services are furnished by a certified provider, defined as a physician or other individual or entity that also provides, in addition to DSMT, other items or services for which payment may be made under Medicare. The physician, individual or entity that furnishes the training also must meet certain quality standards. The physician, individual or entity can meet standards established by us or standards originally established by the National Diabetes Advisory Board and subsequently revised by organizations who participated in their establishment, or can be recognized by an organization that represents individuals with diabetes as meeting standards for furnishing the services.

We require that all those who furnish DSMT services be accredited as meeting quality standards by a CMS-approved national accreditation organization (NAO). In accordance with § 410.144, a CMS-approved NAO may accredit an Start Printed Page 46216individual, physician or entity to meet one of three sets of DSMT quality standards: CMS quality standards; the National Standards for Diabetes Self-Management Education Programs (National Standards); or the standards of an NAO that represents individuals with diabetes that meet or exceed our quality standards. Currently, we recognize the American Diabetes Association and the American Association of Diabetes Educators as approved NAOs, both of whom follow National Standards. Medicare payment for outpatient DSMT services is made in accordance with § 414.63.

An article titled “Use of Medicare's Diabetes Self-Management Training Benefit” was published in the Health Education Behavior on January 23, 2015. The article noted that only 5 percent of Medicare beneficiaries with newly diagnosed diabetes used DSMT services. The article recommended that future research identify barriers to DSMT access.

We understand there are a number of issues that may contribute to the low utilization of these services. Some of the issues that have been brought to our attention by the DSMT community and NAOs are:

  • Concerns that claims have been rejected or denied because of confusion about the credentials of the individuals who furnish DSMT services. In entities following the National Standards, the credentials of the educators actually providing the training are determined by the NAO and are not to be determined by the Medicare Administrative Contractor. Many individuals who actually furnish DSMT services, such as registered nurses and pharmacists, do not qualify to enroll in Medicare as certified providers, as that term is defined at section 1861(qq)(2)(A) of the Act, and codified in our regulations at § 410.140 as approved entit(ies).
  • Questions about when individual (rather than group) DSMT services are available. As noted above, the benefit consists of 1 hour of individual and 9 hours of group training unless special circumstances warrant more individual training or no group session is available within 2 months of the date the training is ordered. The special circumstances are when the beneficiary's physician or qualified NPP documents in the beneficiary's medical record that the beneficiary has special needs resulting from conditions such as severe vision, hearing, or language limitations that would hinder effective participation in a group training session. In all cases, however, the physician or NPP must order individual training.
  • Concerns that the Medicare Benefit Policy Manual, Chapter 15, section 300 does not clarify the settings and locations in which DSMT services may be provided. As a result, some providers (and perhaps some Medicare contractors) are confused. In regard to this issue, we note that a forthcoming manual update will reiterate the guidance we provided to the DSMT community, including the NAOs, in a response to their letter requesting clarification regarding the settings and locations in which DSMT services can be provided. The manual update will clarify that: (a) In the case of DSMT services furnished by an entity that submits professional claims to the A/B Medicare Administrative Contractor (MAC), such as a physician's office or an RD's practice, DSMT services may be furnished at alternate locations used by the entity as a practice location; and (b) when the DSMT services are furnished by an entity that is a hospital outpatient department (HOPD), these DSMT services must be furnished in the hospital (including a provider-based department) and cannot be furnished at alternate non-hospital locations. We plan to address and clarify the above issues through Medicare program instructions as appropriate. We also recognize the possibility that Medicare payment for these services may not fully reflect the resources required to provide them and this may be contributing to relatively low utilization. There may also be other barriers to access of which we are not aware. We are seeking public comment on such barriers to help us identify and address them. We also seek comment and information on whether Medicare payment for these services is accurate. In particular, we would appreciate information on the time and intensity of services provided, and on the services and supplies that should be included in the calculation of practice expenses. We will consider this information to determine whether to propose an update to resource inputs used to develop payment rates for these services in future rulemaking.

G. Target for Relative Value Adjustments for Misvalued Services

Section 1848(c)(2)(O) of the Act establishes 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 from 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. Under section 1848(c)(2)(O)(v) of the Act, the target that applies to calendar years (CYs) 2017 and 2018 is calculated as 0.5 percent of the estimated amount of expenditures under the PFS for the year.

In CY 2016 PFS rulemaking, we proposed and finalized a methodology to implement this statutory provision.

Because the annual target is calculated by measuring changes from one year to the next, for CY 2016, we considered how to account for changes in values that are best measured over 3 years, instead of 2 years. As we described in the CY 2016 final rule with comment period (80 FR 70932), our general valuation process for potentially misvalued, new, and revised codes was to establish values on an interim final basis for a year in the PFS final rule with comment period. Then, during the 60-day period following the publication of the final rule with comment period, we would accept public comment about those valuations. In the final rule with comment period for the subsequent year, we would consider and respond to public comments received on the interim final values, and make any appropriate adjustments to values based on those comments. Under that process for revaluing new, revised, and misvalued codes, we believe the overall change in valuation for many codes would best measured across values for 3 years: Between the original value in the first year; the interim final value in the second year; and the finalized value in the third year. However, the target calculation for a year would only be comparing changes in RVUs between 2 years and not among 3 years, so the Start Printed Page 46217contribution 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) are 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. We noted that 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 generated challenges in calculating the target for CY 2016. 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 had then included 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 and finalized the decision 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.

For the CY 2017 final rule with comment period, we will be finalizing values (year 3) for codes that were interim final in CY 2016 (year 2). Unlike codes that were interim final for CY 2015, the codes that are interim final for CY 2016 were included as misvalued codes and will fall within the range of years for which the misvalued code target provision applies. Thus, overall changes in values for these codes would be measured in the target across 3 full years: The original value in the first year (CY 2015); the interim final value in the second year (CY 2016); and the finalized value in the third year (CY 2017). The changes in valuation for these CY 2016 interim final codes were previously measured and counted towards the target during their initial change in valuation between years 1 and 2.

As such, we are proposing to include changes in values of the CY 2016 interim final codes toward the CY 2017 misvalued code target. We believe that this is consistent with the approach that we finalized in last year's final rule with comment period. The changes in values of CY 2015 interim final codes were not counted towards the misvalued code target in CY 2016 since the valuation change occurred over multiple years, including years not applicable to the misvalued code target provision. However, both of the changes in valuation for the CY 2016 interim final codes, from year 1 to year 2 (CY 2015 to CY 2016) and from year 2 to year 3 (CY 2016 to CY 2017), have taken place during years that occur within the misvalued code target provision. We therefore believe that any adjustments made to these codes based on public comment should be considered towards the achievement of the target for CY 2017, just as any changes in valuation for these same CY 2016 interim final codes previously counted towards the achievement of the target for CY 2016.

We seek public comments regarding this proposal. We also remind commenters that we have revised our process for revaluing new, revised and misvalued codes so that we will be proposing and finalizing values for most of the misvalued codes during a single calendar year. After this year, there will be far fewer instances of interim final codes and changes that are best measured over 3 years far.

We refer readers to the regulatory impact analysis section of this proposed rule for our estimate of the proposed net reduction in expenditures relative to the 0.5 percent target for CY 2017, 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 2017 PFS proposed rule at http://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​PhysicianFeeSched/​index.html.

H. Phase-In of Significant RVU Reductions

Section 1848(c)(7) of the Act 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.

In the CY 2016 PFS rulemaking, we proposed and finalized a methodology to implement this statutory provision. To determine which services are described by new or revised codes for purposes of the phase-in provision, we apply the phase-in to all services that are described by the same, unrevised code in both the current and update year, and exclude codes that describe different services in the current and update year.

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 estimate the total RVUs for a service prior to the budget-neutrality redistributions that result from implementing phase-in values. In implementing the phase-in, we consider a 19 percent reduction as the maximum 1-year reduction for any service not described by a new or revised code. This approach limits the year one reduction for the service to the maximum allowed amount (that is, 19 percent), and then phases in the remainder of the reduction.

The statute provides 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 for a year is estimated to be equal to or greater than 20 percent. Since CY 2016 was the first year in which we applied the phase-in transition, CY 2017 will be the first year in which a single code could be subject to RVU reductions greater than 20 percent for 2 consecutive years.

Under our finalized policy, the only codes that are not subject to the phase-in are those that are new or revised, which we defined as those services that are not described by the same, unrevised code in both the current and update year, or by the same codes that describe different services in the current and update year. Since CY 2016 was the first year for which the phase-in provision applied, we did not address how we would handle codes with Start Printed Page 46218values that had been partially phased in during the first year, but that have a remaining phase-in reduction of 20 percent or greater.

The significant majority of codes with reductions in RVUs that are greater than 20 percent in year one would not be likely to meet the 20 percent threshold in a consecutive year. However, in a few cases, significant changes (for example, in the input costs included in the valuation of a service) could produce reductions of 20 percent or greater in consecutive years.

We believe that a consistent methodology regarding the phase-in transition should be applied to these cases. We propose to reconsider in each year, for all codes that are not new or revised codes and including codes that were assigned a phase-in value in the previous year, whether the total RVUs for the service would otherwise be decreased by an estimated 20 percent or more as compared to the total RVUs for the previous year. Under this proposed policy, the 19 percent reduction in total RVUs would continue to be the maximum one-year reduction for all codes (except those considered new and revised), including those codes with phase-in values in the previous year. In other words, for purposes of the 20 percent threshold, every service is evaluated anew each year, and any applicable phase-in is limited to a decrease of 19 percent. For example, if we were to adopt a 50 percent reduction in total RVUs for an individual service, the reduction in any particular year would be limited to a decrease of 19 percent in total RVUs. Because we do not set rates 2 years in advance, the phase-in transition continues to apply until the year-to-year reduction for a given code does not meet the 20 percent threshold.

We are soliciting comments regarding this proposal.

The list of codes proposed to be subject to the phase-in and the associated proposed RVUs that result from this methodology are available on the CMS Web site under downloads for the CY 2017 PFS proposed rule at http://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​PhysicianFeeSched/​PFS-Federal-Regulation-Notices.html.

I. Geographic Practice Cost Indices (GPCIs)

1. Background

Section 1848(e)(1)(A) of the Act requires us to develop separate Geographic Practice Cost Indices (GPCIs) to measure relative cost differences among localities compared to the national average for each of the three fee schedule components (that is, work, PE, and malpractice (MP)). The PFS localities are discussed in section II.E.3. of this proposed rule. Although the statute requires that the PE and MP GPCIs reflect the full relative cost differences, section 1848(e)(1)(A)(iii) of the Act requires that the work GPCIs reflect only one-quarter of the relative cost differences compared to the national average. In addition, section 1848(e)(1)(G) of the Act sets a permanent 1.5 work GPCI floor for services furnished in Alaska beginning January 1, 2009, and section 1848(e)(1)(I) of the Act sets a permanent 1.0 PE GPCI floor for services furnished in frontier states (as defined in section 1848(e)(1)(I) of the Act) beginning January 1, 2011. Additionally, section 1848(e)(1)(E) of the Act provided for a 1.0 floor for the work GPCIs, which was set to expire on March 31, 2015. Section 201 of the MACRA amended the statute to extend the 1.0 floor for the work GPCIs through CY 2017 (that is, for services furnished no later than December 31, 2017).

Section 1848(e)(1)(C) of the Act requires us to review and, if necessary, adjust the GPCIs at least every 3 years. Section 1848(e)(1)(C) of the Act requires that, if more than 1 year has elapsed since the date of the last previous GPCI adjustment, the adjustment to be applied in the first year of the next adjustment shall be half of the adjustment that otherwise would be made. Therefore, since the previous GPCI update was implemented in CY 2014 and CY 2015, we are proposing to phase in 1/2 of the latest GPCI adjustment in CY 2017.

We have completed a review of the GPCIs and are proposing new GPCIs in this proposed rule. We also calculate a geographic adjustment factor (GAF) for each PFS locality. The GAFs are a weighted composite of each area's work, PE and malpractice expense GPCIs using the national GPCI cost share weights. While we do not actually use GAFs in computing the fee schedule payment for a specific service, they are useful in comparing overall areas costs and payments. The actual effect on payment for any actual service would deviate from the GAF to the extent that the proportions of work, PE and MP RVUs for the service differ from those of the GAF.

As noted above, section 201 of the MACRA extended the 1.0 work GPCI floor for services furnished through December 31, 2017. Therefore, the proposed CY 2017 work GPCIs and summarized GAFs reflect the 1.0 work floor. Additionally, as required by sections 1848(e)(1)(G) and 1848(e)(1)(I) of the Act, the 1.5 work GPCI floor for Alaska and the 1.0 PE GPCI floor for frontier states are permanent, and therefore, applicable in CY 2017. See Addenda D and E to this proposed rule for the proposed CY 2017 GPCIs and summarized GAFs available on the CMS Web site under the supporting documents section of the CY 2017 PFS proposed rule located at https://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​PhysicianFeeSched/​index.html.

2. GPCI Update

The proposed updated GPCI values were calculated by a contractor. There are three GPCIs (work, PE, and MP), and all GPCIs are calculated through comparison to a national average for each. Additionally, each of the three GPCIs relies on its own data source(s) and methodology for calculating its value as described below. Additional information on the CY 2017 GPCI update may be found in our contractor's draft report, “Draft Report on the CY 2017 Update of the Geographic Practice Cost Index for the Medicare Physician Fee Schedule,” which is available on our Web site. It is located under the supporting documents section for the CY 2017 PFS proposed rule located at https://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​PhysicianFeeSched/​index.html.

a. Work GPCIs

The work GPCIs are designed to reflect the relative costs of physician labor by Medicare PFS locality. As required by statute, the work GPCI reflects one quarter of the relative wage differences for each locality compared to the national average.

To calculate the work GPCIs, we use wage data for seven professional specialty occupation categories, adjusted to reflect one-quarter of the relative cost differences for each locality compared to the national average, as a proxy for physicians' wages. Physicians' wages are not included in the occupation categories used in calculating the work GPCI because Medicare payments are a key determinant of physicians' earnings. Including physician wage data in calculating the work GPCIs would potentially introduce some circularity to the adjustment since Medicare payments typically contribute to or influence physician wages. That is, including physicians' wages in the physician work GPCIs would, in effect, make the indices, to some extent, dependent upon Medicare payments.Start Printed Page 46219

The work GPCI updates in CYs 2001, 2003, 2005, and 2008 were based on professional earnings data from the 2000 Census. However, for the CY 2011 GPCI update (75 FR 73252), the 2000 data were outdated and wage and earnings data were not available from the more recent Census because the “long form” was discontinued. Therefore, we used the median hourly earnings from the 2006 through 2008 Bureau of Labor Statistics (BLS) Occupational Employment Statistics (OES) wage data as a replacement for the 2000 Census data. The BLS OES data meet several criteria that we consider to be important for selecting a data source for purposes of calculating the GPCIs. For example, the BLS OES wage and employment data are derived from a large sample size of approximately 200,000 establishments of varying sizes nationwide from every metropolitan area and can be easily accessible to the public at no cost. Additionally, the BLS OES is updated regularly, and includes a comprehensive set of occupations and industries (for example, 800 occupations in 450 industries). For the CY 2014 GPCI update, we used updated BLS OES data (2009 through 2011) as a replacement for the 2006 through 2008 data to compute the work GPCIs.

Because of its reliability, public availability, level of detail, and national scope, we believe the BLS OES continues to be the most appropriate source of wage and employment data for use in calculating the work GPCIs (and as discussed in section II.E.2.b the employee wage component and purchased services component of the PE GPCI). Therefore, for the proposed CY 2017 GPCI update, we used updated BLS OES data (2011 through 2014) as a replacement for the 2009 through 2011 data to compute the work GPCIs.

b. Practice Expense GPCIs

The PE GPCIs are designed to measure the relative cost difference in the mix of goods and services comprising practice expenses (not including malpractice expenses) among the PFS localities as compared to the national average of these costs. Whereas the physician work GPCIs (and as discussed later in this section, the MP GPCIs) are comprised of a single index, the PE GPCIs are comprised of four component indices (employee wages; purchased services; office rent; and equipment, supplies and other miscellaneous expenses). The employee wage index component measures geographic variation in the cost of the kinds of skilled and unskilled labor that would be directly employed by a physician practice. Although the employee wage index adjusts for geographic variation in the cost of labor employed directly by physician practices, it does not account for geographic variation in the cost of services that typically would be purchased from other entities, such as law firms, accounting firms, information technology consultants, building service managers, or any other third-party vendor. The purchased services index component of the PE GPCI (which is a separate index from employee wages) measures geographic variation in the cost of contracted services that physician practices would typically buy. (For more information on the development of the purchased service index, we refer readers to the CY 2012 PFS final rule with comment period (76 FR 73084 through 73085)). The office rent index component of the PE GPCI measures relative geographic variation in the cost of typical physician office rents. For the medical equipment, supplies, and miscellaneous expenses component, we believe there is a national market for these items such that there is not significant geographic variation in costs. Therefore, the equipment, supplies and other miscellaneous expense cost index component of the PE GPCI is given a value of 1.000 for each PFS locality.

For the previous update to the GPCIs (implemented in CY 2014) we used 2009 through 2011 BLS OES data to calculate the employee wage and purchased services indices for the PE GPCI. As discussed in section II.E.2.a., because of its reliability, public availability, level of detail, and national scope, we continue to believe the BLS OES is the most appropriate data source for collecting wage and employment data. Therefore, in calculating the proposed CY 2017 GPCI update, we used updated BLS OES data (2011 through 2014) as a replacement for the 2009 through 2011 data for purposes of calculating the employee wage component and purchased service index of the PE GPCI.

c. Malpractice Expense (MP) GPCIs

The MP GPCIs measure the relative cost differences among PFS localities for the purchase of professional liability insurance (PLI). The MP GPCIs are calculated based on insurer rate filings of premium data for $1 million to $3 million mature claims-made policies (policies for claims made rather than services furnished during the policy term). For the CY 2014 GPCI update (seventh update) we used 2011 and 2012 malpractice premium data (78 FR 74382). The proposed CY 2017 MP GPCI update reflects 2014 and 2015 premium data. Additionally, the proposed CY 2017 MP GPCI update reflects several proposed technical refinements to the MP GPCI methodology as discussed later in section 5.

d. GPCI Cost Share Weights

For the proposed CY 2017 GPCIs, we are continuing to use the current cost share weights for determining the PE GPCI values and locality GAFs. We refer readers to the CY 2014 PFS final rule with comment period (78 FR 74382 through 74383), for further discussion regarding the 2006-based MEI cost share weights revised in CY 2014 that were also finalized for use in the CY 2014 (seventh) GPCI update.

The proposed GPCI cost share weights for CY 2017 are displayed in Table 12.

Table 12—Proposed Cost Share Weights for CY 2017 GPCI Update

Expense categoryCurrent cost share weight (%)Proposed CY 2017 cost share weight (%)
Work50.86650.866
Practice Expense44.83944.839
—Employee Compensation16.55316.553
—Office Rent10.22310.223
—Purchased Services8.0958.095
—Equipment, Supplies, Other9.9689.968
Malpractice Insurance4.2954.295
Total100.000100.000
Start Printed Page 46220

e. PE GPCI Floor for Frontier States

Section 10324(c) of the Affordable Care Act added a new subparagraph (I) under section 1848(e)(1) of the Act to establish a 1.0 PE GPCI floor for physicians' services furnished in frontier states effective January 1, 2011. In accordance with section 1848(e)(1)(I) of the Act, beginning in CY 2011, we applied a 1.0 PE GPCI floor for physicians' services furnished in states determined to be frontier states. In general, a frontier state is one in which at least 50 percent of the counties are “frontier counties,” which are those that have a population per square mile of less than 6. For more information on the criteria used to define a frontier state, we refer readers to the FY 2011 Inpatient Prospective Payment System (IPPS) final rule (75 FR 50160 through 50161). There are no changes in the states identified as Frontier States for the CY 2017 proposed rule. The qualifying states are: Montana, Wyoming, North Dakota, South Dakota, and Nevada. In accordance with statute, we would apply a 1.0 PE GPCI floor for these states in CY 2017.

f. Proposed GPCI Update

As explained above in the background section, the periodic review and adjustment of GPCIs is mandated by section 1848(e)(1)(C) of the Act. At each update, the proposed GPCIs are published in the PFS proposed rule to provide an opportunity for public comment and further revisions in response to comments prior to implementation. The proposed CY 2017 updated GPCIs for the first and second year of the 2-year transition, along with the GAFs, are displayed in Addenda D and E to this proposed rule available on our Web site under the supporting documents section of the CY 2017 PFS proposed rule Web page at https://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​PhysicianFeeSched/​index.html.

3. Payment Locality Discussion

a. Background

The current PFS locality structure was developed and implemented in 1997. There are currently 89 total PFS localities; 34 localities are statewide areas (that is, only one locality for the entire state). There are 52 localities in the other 16 states, with 10 states having 2 localities, 2 states having 3 localities, 1 state having 4 localities, and 3 states having 5 or more localities. The combined District of Columbia, Maryland, and Virginia suburbs; Puerto Rico; and the Virgin Islands are the remaining three localities of the total of 89 localities. The development of the current locality structure is described in detail in the CY 1997 PFS proposed rule (61 FR 34615) and the subsequent final rule with comment period (61 FR 59494). We note that the localities generally represent a grouping of one or more constituent counties.

Prior to 1992, Medicare payments for physicians' services were made under the reasonable charge system. Payments were based on the charging patterns of physicians. This resulted in large differences in payment for physicians' services among types of services, geographic payment areas, and physician specialties. Recognizing this, the Congress replaced the reasonable charge system with the Medicare PFS in the Omnibus Budget Reconciliation Act (OBRA) of 1989, and the PFS went into effect January 1, 1992. Payments under the PFS are based on the relative resources involved with furnishing services, and are adjusted to account for geographic variations in resource costs as measured by the GPCIs.

Payment localities originally were established under the reasonable charge system by local Medicare carriers based on their knowledge of local physician charging patterns and economic conditions. These localities changed little between the inception of Medicare in 1967 and the beginning of the PFS in 1992. Shortly after the PFS took effect, we undertook a study in 1994 that culminated in a comprehensive locality revision that was implemented in 1997 (61 FR 59494).

The revised locality structure reduced the number of localities from 210 to the current 89, and the number of statewide localities increased from 22 to 34. The revised localities were based on locality resource cost differences as reflected by the GPCIs. For a full discussion of the methodology, see the CY 1997 PFS final rule with comment period (61 FR 59494). The current 89 fee schedule areas are defined alternatively by state boundaries (for example, Wisconsin), metropolitan areas (for example, Metropolitan St. Louis, MO), portions of a metropolitan area (for example, Manhattan), or rest-of-state areas that exclude metropolitan areas (for example, Rest of Missouri). This locality configuration is used to calculate the GPCIs that are in turn used to calculate payments for physicians' services under the PFS.

As stated in the CY 2011 PFS final rule with comment period (75 FR 73261), changes to the PFS locality structure would generally result in changes that are budget neutral within a state. For many years, before making any locality changes, we have sought consensus from among the professionals whose payments would be affected. In recent years, we have also considered more comprehensive changes to locality configuration. In 2008, we issued a draft comprehensive report detailing four different locality configuration options (https://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​PhysicianFeeSched/​downloads/​ReviewOfAltGPCIs.pdf). We refer readers to the CY 2014 PFS final rule with comment period for further discussion regarding that report, as well as a discussion about the Institute of Medicine's empirical study of the Medicare GAFs established under sections 1848(e) (PFS GPCI) and 1886(d)(3)(E) (IPPS wage index) of the Act.

b. California Locality Update to the Fee Schedule Areas Used for Payment Under Section 220(h) of the Protecting Access to Medicare Act

(1) General Discussion and Legislative Change

Section 220(h) of the PAMA added a new section 1848(e)(6) to the Act, that modifies the fee schedule areas used for payment purposes in California beginning in CY 2017.

Currently, the fee schedule areas used for payment in California are based on the revised locality structure that was implemented in 1997 as previously discussed. Beginning in CY 2017, section 1848(e)(6)(A)(i) of the Act requires that the fee schedule areas used for payment in California must be Metropolitan Statistical Areas (MSAs) as defined by the Office of Management and Budget (OMB) as of December 31 of the previous year; and section 1848(e)(6)(A)(ii) of the Act requires that all areas not located in an MSA must be treated as a single rest-of-state fee schedule area. The resulting modifications to California's locality structure would increase its number of localities from 9 under the current locality structure to 27 under the MSA-based locality structure.

However, section 1848(e)(6)(D) of the Act defines transition areas as the fee schedule areas for 2013 that were the rest-of-state locality, and locality 3, which was comprised of Marin county, Napa county, and Solano county. Section 1848(e)(6)(B) specifies that the GPCI values used for payment in a transition area are to be phased in over 6 years, from 2017 through 2021, using a weighted sum of the GPCIs calculated under the new MSA-based locality structure and the GPCIs calculated under the current PFS locality structure. That is, the GPCI values applicable for Start Printed Page 46221these areas during this transition period are a blend of what the GPCI values would have been under the current locality structure, and what the GPCI values would be under the MSA-based locality structure. For example, in the first year, CY 2017, the applicable GPCI values for counties that were previously in rest-of-state or locality 3 and are now in MSAs are a blend of 1/6 of the GPCI value calculated for the year under the MSA-based locality structure, and 5/6 of the GPCI value calculated for the year under the current locality structure. The proportions shift by 1/6 in each subsequent year so that, by CY 2021, the applicable GPCI values for counties within transition areas are a blend of 5/6 of the GPCI value for the year under the MSA-based locality structure, and 1/6 of the GPCI value for the year under the current locality structure. Beginning in CY 2022, the applicable GPCI values for counties in transition areas are the values calculated under the new MSA-based locality structure. For the sake of clarity, we reiterate that this incremental phase-in is only applicable to those counties that are in transition areas that are now in MSAs, which are only some of the counties in the 2013 California rest-of state locality and locality 3.

Additionally, section 1848(e)(6)(C) of the Act establishes a hold harmless for transition areas beginning with CY 2017 whereby the applicable GPCI values for a year under the new MSA-based locality structure may not be less than what they would have been for the year under the current locality structure. There are a total of 58 counties in California, 50 of which are in transition areas as defined in section 1848(e)(6)(D) of the Act. Therefore, 50 counties in California are subject to the hold harmless provision. The other 8 counties, which are metropolitan counties that are not defined as transition areas, are not held harmless for the impact of the new MSA-based locality structure, and may therefore potentially experience slight decreases in their GPCI values as a result of the provisions in section 1848(e)(6) of the Act, insofar as the locality in which they are located now newly includes data from adjacent counties that decreases their GPCI values relative to those that would have applied had the new data not been incorporated. Therefore, the GPCIs for these eight counties under the MSA-based locality structure may be less than they would have been under the current GPCI structure. The eight counties that are not within transition areas are: Orange; Los Angeles; Alameda; Contra Costa; San Francisco; San Mateo; Santa Clara; and Ventura counties.

We emphasize that while transition areas are held harmless from the impact of the GPCI changes using the new MSA-based locality structure, because we are proposing other updates for CY 2017 as part of the eighth GPCI update, including the use of updated data, transition areas would still be subject to impacts resulting from those other updates. Table 13 illustrates using GAFs, for CY 2017, the isolated impact of the MSA-based locality changes and hold-harmless for transition areas required by section 1848(e)(6) of the Act, the impact of the proposed use of updated data for GPCIs, and the combined impact of both of these proposed changes.

Table 13—Impact on California GAFs as a Result of Section 1848(e)(6) of the Act and Proposed Updated Data by Fee Schedule Area

[Sorted alphabetically by locality name]

Medicare fee schedule areaTransition area2016 GAF2017 GAF w/o 1848(e)(6)% Change due to new GPCI data2017 GAF w/1848(e)(6)% Change due to 1848(e)(6)Combined impact of PAMA and new GPCI data (%)
Bakersfield11.041.031−0.501.0310.00−0.50
Chico11.041.031−0.501.0310.00−0.50
El Centro11.041.031−0.501.0310.00−0.50
Fresno11.041.031−0.501.0310.00−0.50
Hanford-Corcoran11.041.031−0.501.0310.00−0.50
Los Angeles-Long Beach-Anaheim (Los Angeles County)01.091.09−0.201.0910.10−0.10
Los Angeles-Long Beach-Anaheim (Orange County)01.091.1041.101.101−0.300.80
Madera11.041.031−0.501.0310.00−0.50
Merced11.041.031−0.501.0310.00−0.50
Modesto11.041.031−0.501.0310.00−0.50
Napa11.141.128−0.801.1280.00−0.80
Oxnard-Thousand Oaks-Ventura01.091.083−0.601.0830.00−0.60
Redding11.041.031−0.501.0310.00−0.50
Rest Of California11.041.031−0.501.0310.00−0.50
Riverside-San Bernardino-Ontario11.041.031−0.501.0320.10−0.40
Sacramento-Roseville-Arden-Arcade11.041.031−0.501.0310.00−0.50
Salinas11.041.031−0.501.0330.20−0.30
San Diego-Carlsbad11.041.031−0.501.0350.40−0.10
San Francisco-Oakland-Hayward (Alameda/Contra Costa County)01.181.125−4.801.1421.50−3.40
San Francisco-Oakland-Hayward (Marin County)11.141.128−0.801.1290.10−0.70
San Francisco-Oakland-Hayward (San Francisco County)01.181.1941.001.175−1.60−0.60
San Francisco-Oakland-Hayward (San Mateo County)01.181.1870.401.171−1.30−0.90
San Jose-Sunnyvale-Santa Clara (San Benito County)11.041.031−0.501.0532.101.60
San Jose-Sunnyvale-Santa Clara (Santa Clara County)01.181.1760.101.175−0.100.00
Start Printed Page 46222
San Luis Obispo-Paso Robles-Arroyo Grande11.041.031−0.501.0310.00−0.50
Santa Cruz-Watsonville11.041.031−0.501.0421.100.60
Santa Maria-Santa Barbara11.041.031−0.501.0360.500.00
Santa Rosa11.041.031−0.501.0370.600.10
Stockton-Lodi11.041.031−0.501.0310.00−0.50
Vallejo-Fairfield11.141.128−0.801.1280.00−0.80
Visalia-Porterville11.041.031−0.501.0310.00−0.50
Yuba City11.041.031−0.501.0310.00−0.50

Additionally, for the purposes of calculating budget neutrality and consistent with the PFS budget neutrality requirements as specified under section 1848(c)(2)(B)(ii)(II) of the Act, we are proposing to start by calculating the national GPCIs as if the current localities are still applicable nationwide; then for the purposes of payment in California, we will override the GPCI values with the values that are applicable for California consistent with the requirements of section 1848(e)(6) of the Act. This approach is consistent with the implementation of the GPCI floor provisions that have previously been implemented—that is, as an after-the-fact adjustment that is implemented for purposes of payment after both the GPCIs and PFS budget neutrality have already been calculated.

(2) Proposed Operational Considerations

As discussed above, under section 1848(e)(6) of the Act, counties that were previously in the rest-of-state locality or locality 3 and are now in MSAs would have their GPCI values under the new MSA-based locality structure phased in gradually, in increments of one-sixth over 6 years. Section 1848(e)(1)(C) of the Act requires that, if more than 1 year has elapsed since the date of the last previous GPCI adjustment, the adjustment to be applied in the first year of the next adjustment shall be 1/2 of the adjustment that otherwise would be made. While section 1848(e)(6)(B) of the Act establishes a blended phase-in for the MSA-based GPCI values, it does not explicitly state whether or how that provision is to be reconciled with the requirement at section 1848(e)(1)(C) of the Act. We believe that since section 1848(e)(6)(A) of the Act requires that we must make the change to MSA-based fee schedule areas for California GPCIs notwithstanding the preceding provisions of section 1848(e) of the Act, and subject to the succeeding provisions of section 1848(e)(6) of the Act, that applying the two-year phase-in specified by the preceding provisions simultaneously with the six-year phase-in would undermine the incremental 6-year phase-in specified in section 1848(e)(6)(B) of the Act. Therefore, we are proposing that the requirement at section 1848(e)(1)(C) of the Act to phase in 1/2 of the adjustment in year 1 of the GPCI update would not apply to counties that were previously in the rest-of-state or locality 3 and are now in MSAs, and therefore, are subject to the blended phase-in as described above. Since section 1848(e)(6)(B) of the Act provides for a gradual phase in of the GPCI values under the new MSA-based locality structure, specifically in one-sixth increments over 6 years, if we were to also apply the requirement to phase in 1/2 of the adjustment in year 1 of the GPCI update then the first year increment would effectively be one-twelfth. We note that this issue is only of concern if more than 1 year has elapsed since the previous GPCI update, and would only be applicable through CY 2021 since, beginning in CY 2022, the GPCI values for such areas in an MSA would be fully based on the values calculated under the new MSA-based locality structure for California.

As previously stated, the resulting modifications to California's locality structure increase its number of localities from 9 under the current locality structure to 27 under the MSA-based locality structure. However, both the current localities and the MSA-based localities are comprised of various component counties, and in some localities only some of the component counties are subject to the blended phase-in and hold harmless provisions required by section 1848(e)(6)(B) and (C) of the Act. Therefore, the application of these provisions may produce differing GPCI values among counties within the same fee schedule area under the MSA-based locality structure. For example, the MSA-based San Jose-Sunnyvale-Santa Clara locality, is comprised of 2 constituent counties—San Benito county, and Santa Clara county. San Benito County is in a transition area (2013 rest-of-state), while Santa Clara county is not. Hence, although the counties are in the same MSA, the requirements of section 1848(e)(6)(B) and (C) of the Act may produce differing GPCI values for each county. To address this issue, we propose to assign a unique locality number to the counties that would be impacted in the aforementioned manner. As a result, although the modifications to California's locality structure increase the number of localities from 9 under the current locality structure to 27 under the MSA-based locality structure, for purposes of payment, the actual number of localities under the MSA-based locality structure would be 32 to account for instances where unique locality numbers are needed as described above. Additionally, while the fee schedule area names are consistent with the MSAs designated by OMB, we are proposing to maintain 2-digit locality numbers to correspond to the existing fee schedule areas. Pursuant to the implementation of the new MSA-based locality structure for California, the total number of PFS localities would increase from 89 to 112. Table 14 displays the current fee schedule areas in California, and Table 15 displays the MSA-based fee schedule areas in California required by section 1848(e)(6) of the Act. Additional information on the California locality update may be found in our contractor's draft report, “Draft Report on the CY 2017 Update of the Geographic Practice Cost Index for the Medicare Physician Fee Schedule,” which is available on the CMS Web site. Start Printed Page 46223It is located under the supporting documents section of the CY 2017 PFS proposed rule located at https://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​PhysicianFeeSched/​index.html.

Table 14—Current Fee Schedule Areas in California

[Sorted alphabetically by locality name]

Locality numberFee schedule areaCounties
26Anaheim/Santa AnaOrange
18Los AngelesLos Angeles
03Marin/Napa/SolanoMarin, Napa, And Solano
07Oakland/BerkleyAlameda And Contra Costa
05San FranciscoSan Francisco
06San MateoSan Mateo
09Santa ClaraSanta Clara
17VenturaVentura
99Rest Of StateAll Other Counties

Table 15—MSA-Based Fee Schedule Areas in California

[Sorted alphabetically by locality name]

Current locality numberProposed new locality numberFee schedule area (MSA name)CountiesTransition area
9954Bakersfield, CAKernYES.
9955Chico, CAButteYES.
9971El Centro, CAImperialYES.
9956Fresno, CAFresnoYES.
9957Hanford-Corcoran, CAKingsYES.
1818Los Angeles-Long Beach-Anaheim, CA (Los Angeles County)Los AngelesNO.
2626Los Angeles-Long Beach-Anaheim, CA (Orange County)OrangeNO.
9958Madera, CAMaderaYES.
9959Merced, CAMercedYES.
9960Modesto, CAStanislausYES.
351Napa, CANapaYES.
1717Oxnard-Thousand Oaks-Ventura, CAVenturaNO.
9961Redding, CAShastaYES.
9975REST OF STATEAll Other CountiesYES.
9962Riverside-San Bernardino-Ontario, CARiverside, and San BernardinoYES.
9963Sacramento—Roseville—Arden-Arcade, CAEl Dorado, Placer, Sacramento, and YoloYES.
9964Salinas, CAMontereyYES.
9972San Diego-Carlsbad, CASan DiegoYES.
77San Francisco-Oakland-Hayward, CA (Alameda County/Contra Costa County)Alameda, Contra CostaNO.
352San Francisco-Oakland-Hayward, CA (Marin County)MarinYES.
55San Francisco-Oakland-Hayward, CA (San Francisco County)San FranciscoNO.
66San Francisco-Oakland-Hayward, CA (San Mateo County)San MateoNO.
9965San Jose-Sunnyvale-Santa Clara, CA (San Benito County)San BenitoYES.
99San Jose-Sunnyvale-Santa Clara, CA (Santa Clara County)Santa ClaraNO.
9973San Luis Obispo-Paso Robles-Arroyo Grande, CASan Luis ObispoYES.
9966Santa Cruz-Watsonville, CASanta CruzYES.
9974Santa Maria-Santa Barbara, CASanta BarbaraYES.
9967Santa Rosa, CASonomaYES.
9973Stockton-Lodi, CASan JoaquinYES.
353Vallejo-Fairfield, CASolanoYES.
9969Visalia-Porterville, CATulareYES.
9970Yuba City, CASutter, and YubaYES.

4. Proposed Update to the Methodology for Calculating GPCIs in the U.S. Territories

In calculating GPCIs within U.S. states, we use county-level wage data from the Bureau of Labor Statistics (BLS) Occupational Employment Statistics Survey (OES), county-level residential rent data from the American Community Survey (ACS), and malpractice insurance premium data from state departments of insurance. In calculating GPCIs for the U.S. territories, we currently use three distinct methodologies—one for Puerto Rico, another for the Virgin Islands, and a third for the Pacific Islands (Guam, American Samoa, and Northern Marianas Islands). These three methodologies were adopted at different times based primarily on the data that were available at the time they were adopted. At present, because Puerto Rico is the only territory where county-level BLS OES, county-level ACS, and malpractice premium data are available, it is the only territory for which we use territory-specific data to calculate GPCIs. For the Virgin Islands, because county-level wage and rent data are not available, and insufficient malpractice premium data are available, CMS has set the work, PE, and MP GPCI values for the Virgin Islands payment locality at the national average of 1.0 even though, Start Printed Page 46224like Puerto Rico, the Virgin Islands is its own locality and county-level BLS OES data are available for the Virgin Islands. For the U.S. territories in the Pacific Ocean, we currently crosswalk GPCIs from the Hawaii locality for each of the three GPCIs, and incorporate no local data from these territories into the GPCI calculations even though county-level BLS OES data does exist for Guam, but not for American Samoa or the Northern Mariana Islands.

As noted above, currently Puerto Rico is the only territory for which we calculate GPCIs using the territory-specific information relative to data from the U.S. States. For several years stakeholders in Puerto Rico have raised concerns regarding the applicability of the proxy data in Puerto Rico relative to their applicability in the U.S. states. We believe that these concerns may be consistent across island territories, but lack of available, appropriate data has made it difficult to quantify such variation in costs. For example, some stakeholders previously indicated that shipping and transportation expenses increase the cost of acquiring medical equipment and supplies in islands and territories relative to the mainland. While we have previously attempted to locate data sources specific to geographic variation in such shipping costs, we found no comprehensive national data source for this information (we refer readers to 78 FR 74387 through 74388 for the detailed discussion of this issue). Therefore, we have not been able to quantify variation in costs specific to island territories in the calculation of the GPCIs.

For all the island territories other than Puerto Rico, the lack of comprehensive data about unique costs for island territories has had minimal impact on GPCIs because we have used either the Hawaii GPCIs (for the Pacific territories) or used the unadjusted national averages (for the Virgin Islands). In an effort to provide greater consistency in the calculation of GPCIs given the lack of comprehensive data regarding the validity of applying the proxy data used in the States in accurately accounting for variability of costs for these island territories, we are proposing to treat the Caribbean Island territories (the Virgin Islands and Puerto Rico) in a consistent manner. We propose to do so by assigning the national average of 1.0 to each GPCI index for both Puerto Rico and the Virgin Islands. We are not proposing any changes to the GPCI methodology for the Pacific Island territories (Guam, American Samoa, and Northern Marianas Islands) where we already consistently assign the Hawaii GPCI values for each of the three GPCIs. Additional information on the Proposed Update to the Methodology for Calculating GPCIs in the U.S. Territories may be found in our contractor's draft report, “Draft Report on the CY 2017 Update of the Geographic Practice Cost Index for the Medicare Physician Fee Schedule,” which is available on our Web site. It is located under the supporting documents section of the CY 2017 PFS proposed rule located at https://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​PhysicianFeeSched/​index.html.

5. Proposed Refinement to the MP GPCI Methodology

In the process of calculating MP GPCIs for the purposes of this proposed rule, we identified several technical refinements to the methodology that yield improvements over the current method. We are also proposing refinements that conform to our proposed methodology for calculating the GPCIs for the U.S. Territories described above. Specifically, we are proposing modifications to the methodology to account for missing data used in the calculation of the MP GPCI. Under the methodology used in the CY 2014 GPCI update (78 FR 74380 through 74391), we first calculated the average premiums by insurer and specialty, then imputed premium values for specialties for which we did not have specific data, before adjusting the specialty-specific premium data by market share weights. We are proposing to revise our methodology to instead calculate the average premiums for each specialty using issuer market share for only available companies. This proposed methodological improvement would reduce potential bias resulting from large amounts of imputation, an issue that is prevalent for insurers that only write policies for ancillary specialties for which premiums tend to be low. The current method would impute the low premiums for ancillary specialties across the remaining specialties, and generally greater imputation leads to less accuracy. Additional information on the MP GPCI methodology, and the proposed refinement to the MP GPCI methodology may be found in our contractor's draft report, “Draft Report on the CY 2017 Update of the Geographic Practice Cost Index for the Medicare Physician Fee Schedule,” which is available on our Web site. It is located under the supporting documents section of the CY 2017 PFS proposed rule located at https://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​PhysicianFeeSched/​index.html.

J. Payment Incentive for the Transition From Traditional X-Ray Imaging to Digital Radiography and Other Imaging Services

Section 502(a)(1) of the Consolidated Appropriations Act of 2016 (H.R. 2029) amended section 1848(b) of the Act by establishing new paragraph (b)(9). Effective for services furnished beginning January 1, 2017, section 1848(b)(9)(A) of the Act reduces by 20 percent the payment amounts under the PFS for the technical component (TC) (including the TC portion of a global service) of imaging services that are X-rays taken using film. The reduction is made prior to any other adjustment under this section and without application of this new paragraph.

Section 1848(b)(9)(B) of the Act provides for a 7 percent reduction in payments for imaging services made under the PFS that are X-rays (including the X-ray component of a packaged service) taken using computed radiology furnished during CY 2018, 2019, 2020, 2021, or 2022, and for a 10 percent reduction for such imaging services taken using computed radiology furnished during CY 2023 or a subsequent year. Computed radiology technology is defined for purposes of this paragraph as cassette-based imaging, which utilizes an imaging plate to create the image involved. Section 1848(b)(9) of the Act also requires implementation of the reductions in payment for X-rays through appropriate mechanisms, which can include the use of modifiers. In accordance with section 1848(c)(2)(B)(v)(X), the adjustments under section 1848(b)(9)(A) of the Act are exempt from budget neutrality.

In this section of the rule, we discuss the proposed implementation of the reduction in payment for X-rays taken using film provided for in section 1848(b)(9)(A) of the Act. Because the required reductions in PFS payment for imaging services (including the imaging portion of a service) that are X-rays taken using computed radiography technology does not apply for CY 2017, we will address implementation of section 1848(b)(9)(B) of the Act in future rulemaking.

To implement the provisions of sections 1848(b)(9)(A) of the Act relating to the PFS payment reduction for X-rays taken using film that are furnished during CY 2017 or subsequent years, in this proposed rule, we are proposing to establish a new modifier (modifier “XX”) to be used on claims, as allowed under the section 1848(b)(9)(D) of the Act. The list of CY 2017 applicable HCPCS codes describing imaging services that are X-ray services are on Start Printed Page 46225the CMS Web site under downloads for the CY 2017 PFS proposed rule with comment period at http://www.cms.gov/​physicianfeesched/​downloads/​. We are proposing that, beginning January 1, 2017, this modifier would be required on claims for X-rays that are taken using film. The modifier would be required on claims for the technical component of the X-ray service, including when the service is billed globally, since the PFS payment adjustment is made to the technical component regardless of whether it is billed globally or separately using the -TC modifier. The use of this proposed modifier to indicate an X-ray taken using film would result in a 20-percent reduction for the technical component of the X-ray service, as specified under section 1848(b)(9)(A) of the Act that would be exempt from budget neutrality as specified under section 1848(c)(2)(B)(v)(X) of the Act.

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

Effective January 1, 2012, we implemented an MPPR of 25 percent on the professional component (PC) of advanced imaging services. The reduction applies when multiple imaging procedures are furnished by the same physician (or physician in the same group practice) to the same patient, in the same session, on the same day. Full payment is made for the PC of the highest priced procedure. Payment for the PC of subsequent services is reduced by 25 percent.

Section 502(a)(2)(A) of the Consolidated Appropriations Act, 2016 (Pub. L. 114-113, enacted on December 18, 2015) added a new section 1848(b)(10) of the Act which revises the payment reduction from 25 percent to 5 percent, effective January 1, 2017. Section 502(a)(2)(B) added a new subclause at section 1848(c)(2)(B)(v)(XI) which exempts the reduced expenditures attributable to the revised 5 percent MMPR on the PC of imaging from the PFS budget neutrality provision. We propose to implement these provisions for services furnished on or after January 1, 2017. We refer readers to section VI.C of this proposed rule regarding the necessary adjustment to the proposed PFS conversion factor to account for the mandated exemption from PFS budget neutrality.

We note that the lists of services for the upcoming calendar year that are subject to the MPPR 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 therefore, are subject to the OPPS cap, are displayed in the public use files for the PFS proposed and final rules for each year. The public use files for CY 2017 are available on our Web site under downloads for the CY 2017 PFS proposed rule with comment period at http://www.cms.gov/​Medicare-Fee-for-Service-Payment/​PhysicianFeeSched/​PFSFederal-Regulation-Notices.html.

L. Valuation of Specific Codes

1. Background: Process for Valuing New, Revised, and Potentially Misvalued Codes

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 make sure 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 5-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 5-year review process, revisions in RVUs were proposed and finalized via rulemaking. In addition to the 5-year reviews, beginning with CY 2009, CMS and the RUC have identified a number of potentially misvalued codes each year using various identification screens, as discussed in section II.B.5. of this proposed rule. Historically, when we received RUC recommendations, our process had 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 accepted public comment about those valuations. For services furnished during the calendar year following the publication of interim final rates, we paid 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 considered and responded to public comments received on the interim final values, and typically made any appropriate adjustments and finalized those values.

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. Beginning with this CY 2017 proposed rule, the new process will be applicable to all codes, except for new codes that describe truly new services. For CY 2017, we are proposing new values in this proposed rule for the vast majority of new, revised, and potentially misvalued codes for which we received complete RUC recommendations by February 10, 2016. To complete the transition to this new process, for codes where we established interim final values in the CY 2016 PFS final rule with comment period, we reviewed the comments received during the 60-day public comment period following release of the CY 2016 PFS final rule with comment period, and are re-proposing values for those codes in this CY 2017 proposed rule.

We will consider public comments received during the 60-day public comment period for this proposed rule before establishing final values in the final rule with comment period, and adopt interim final values only 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. Recommendations regarding any new or revised codes received after February 10th will be considered in the next year's proposed rule (that is, CY 2018 PFS rulemaking).

2. Methodology for Proposing Work RVUs

We conduct a review of each code identified in this section and review 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 inputs generally includes, but is not limited to, a review of information provided by the RUC, HCPAC (Health Care Professionals Advisory Committee), and other public commenters, medical literature, and comparative databases, as well as a comparison with other codes within the 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. In the CY 2011 PFS final rule with comment period (75 Start Printed Page 46226FR 73328 through 73329), we discussed a variety of methodologies and approaches used to develop work RVUs, including survey data, building blocks, crosswalks to key reference or similar codes, and magnitude estimation (see the CY 2011 PFS final rule with comment period for more information). 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, we have frequently utilized an incremental methodology in which we value a code based upon its incremental difference between another code or another family of codes. The statute specifically defines the work component as the resources in time and intensity required in furnishing the service. Also, the published literature on valuing work has recognized the key role of time in overall work. For particular codes, we refine the work RVUs 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 intraservice time.

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. Our longstanding adjustments have reflected a broad assumption 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 furnished on the same day as an E/M service.

We note that many commenters and stakeholders have expressed concerns with our ongoing adjustment of work RVUs based on changes in the best information we have regarding the time resources involved in furnishing individual services. We are particularly concerned with the RUC's and various specialty societies' objections to our approach given the significance of their recommendations to our process for valuing services and since much of the information we have used to make the adjustments is derived from their survey process. As explained in the CY 2016 PFS final rule with comment period (80 FR 70933), we recognize that adjusting work RVUs for changes is not always a straightforward process, so we apply various methodologies to identify several potential work values for individual codes. However, we want to reiterate that we are statutorily obligated to consider both time and intensity in establishing work RVUs for PFS services.

We have observed that for many codes reviewed by the RUC, final recommended work RVUs appear to be incongruous with recommended assumptions regarding the resource costs in time. This is the case for a significant portion of codes for which we have recently established or proposed work RVUs that are based on refinements to the RUC-recommended values. When we have adjusted work RVUs to account for significant changes in time, we begin by looking at the change in the time in the context of the RUC-recommended work RVU. When the recommended work RVUs do not appear to account for significant changes in time, we employ the different approaches to identify potential values that reconcile the recommended work RVUs with the recommended time values. Many of these methodologies, such as survey data, building blocks, crosswalks to key reference or similar codes, and magnitude estimation have long been used in developing work RVUs under the PFS. In addition to these we sometimes use the relationship between the old time values and the new time values for particular services to identify alternative work RVUs based on changes in time components.

In so doing, rather than ignoring the RUC-recommended value, we are using the recommended values as a starting reference and then applying one of these several methodologies to account for the reductions in time that we believe have not otherwise been reflected in the RUC recommended value. When we believe that such changes in time have already been accounted for in the RUC recommendation, then we do not make such adjustments. Likewise, we do not arbitrarily apply time ratios to current work RVUs to calculate proposed work RVUs. We use the ratios to identify potential work RVUs and consider these work RVUs as potential options relative to the values developed through other options.

We want to make it clear that we are not implying that the decrease in time as reflected in survey values must equate to a one-to-one or linear decrease in newly valued work RVUs. Instead, we believe that since the two components of work are time and intensity that absent an obvious or explicitly stated rationale for why the relative intensity of a given procedure has increased, that significant decreases in time should be reflected in decreases Start Printed Page 46227to work RVUs. If the RUC recommendation has appeared to disregard or dismiss the changes in time, without a persuasive explanation of why such a change should not be accounted for in the overall work of the service, then we generally use one of the aforementioned referenced methodologies to identify potential work RVUs, including the methodologies intended to account for the changes in the resources involved in furnishing the procedure.

Several commenters, including the RUC, in general have objected to our use of these methodologies and deemed our actions in adjusting the recommended work RVUs as inappropriate. We received several specific comments regarding this issue in response to the CY 2016 PFS final rule with comment period, those comments are summarized below.

Comment: Several commenters, including the RUC, stated that our methodology for adjusting work RVUs appears to be contrary to the statute.

Response: We disagree with these comments. Since section 1848(c)(1)(A) of the Act explicitly identifies time as one of the two types of resources that encompass the work component of the PFS payment, we do not believe that our use of the aforementioned methodologies to adjust the work RVU to account for the changes in time, which is one of the resources involved, 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. 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 observed that the RUC also uses a variety of methodologies to develop work RVUs for individual codes, and subsequently validates the results of these approaches through magnitude estimation or crosswalk to established values for other codes.

Comment: Several commenters, including the RUC, stated that we could not take one element of the services that has changed such as intra-service time, and apply an overall ratio for reduction to the work RVU based on changes to time, as that renders the value no longer resource-based in comparison to the RUC-recommended values.

Response: We disagree with the commenters. 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 service has changed significantly. We reiterate that, consistent with the statute, we are required to value the work RVU based on the relative resources involved in furnishing the service, which include time and intensity. When our review of recommended values determines that changes in the resource of time have been unaccounted for in a recommended RVU, then we believe we have the obligation to account for that change in establishing work RVUs since the statute explicitly identifies time as one of the two elements of the work RVUs. We recognize that it would not be appropriate to develop work RVUs solely based on time given that intensity is also an element of work, but in applying the time ratios we are using derived intensity measures based on current work RVUs for individual procedures. Were we to disregard intensity altogether, the work RVUs for all services would be developed based solely on time values and that is definitively not the case. Furthermore, we reiterate that we use time ratios to identify potential work RVUs, and then use other methods (including estimates of work from CMS medical personnel and crosswalks to key reference or similar codes) to validate these RVUs. We also disagree with several commenters' implications that a work RVU developed through such estimation methods is only resource-based through the RUC process.

Comment: Several commenters, including the RUC, stated that our inconsistent use of the time ratio methodology has rendered it ineffective for valuation purposes and that by choosing the starting base work value and/or physician time at random, we are essentially reverse engineering the work value we want under the guise of a standard algorithm.

Response: We do not choose a starting base work value and/or physician time at random as suggested by the commenters. We use the RUC recommended values or the existing values as the base values; essentially, we are taking one of those values and applying adjustments to account for the change in time that based on our analysis of the RUC recommendation, we determine has not been properly accounted for to determine an appropriate work RVU. In circumstances where adjustments to time and the corresponding work RVU are relatively congruent or persuasively explained, our tendency has been to use those values as recommended. Where the RUC recommendations do not account for changes in time, we have made changes to RUC-recommended values to account for the changes in time.

Comment: Commenters, including the RUC, also stated that the use of time ratio methodologies distills the valuation of the service into a basic formula with the only variable being either the new total physician time or the new intra-service physician time, and that these methodologies are based on the incorrect assumption that the per minute physician work intensity established is permanent regardless of when the service was last valued. Other commenters have suggested that previous assumed times are inaccurate.

Response: We agree with commenters that per minute intensity for a given service may change over time. If we believed that the per-minute intensity for a given service were immutable, then a reverse-building block approach to revaluation based on new time data could be appropriate. However, we have not applied such an approach specifically because we agree that the per-minute intensity of work is not necessarily static over time or even necessarily during the course of a procedure. Instead, we utilize time ratios to identify potential values that account for changes in time and compare these values to other PFS services for estimates of overall work. When the values we develop reflect a similar derived intensity, we agree that our values are the result of our assessment that the relative intensity of a given service has remained similar.

Regarding the validity of comparing new times to the old times, we, too, hope that time estimates have improved over many years especially when many years have elapsed since the last time the service in question was valued. However, we also believe that our operating assumption regarding the validity of the pre-existing values as a point of comparison is critical to the integrity of the relative value system as currently constructed. Pre-existing times are a very important element in the allocation of indirect PE RVUs by specialty, and had the previously recommended times been overestimated, the specialties that furnish such services would be benefitting from these times in the allocation of indirect PE RVUs. As long time observers of the RUC process, we also recognize that the material the RUC uses to develop overall work recommendations includes the data Start Printed Page 46228from the surveys about time. We have previously stated concerns regarding the validity of much of the RUC survey data. However, we believe additional kinds of concern would be warranted if the RUC itself were operating under the assumption that its pre-existing data were typically inaccurate.

We understand stakeholders' concerns regarding how best to consider changes in time in improving the accuracy of work RVUs and have considered all of the issues raised by commenters. In conjunction with our review of recommended code values for CY 2017, we conducted a preliminary analysis to identify general tendencies in the relationship between changes in time and changes in work RVUs for CY 2014 and CY 2015. We looked at services for which there were no coding changes to simplify the analysis. The intent of this preliminary analysis was to examine commenters' beliefs that CMS is only considering time when making refinements to RUC recommended work values. For CY 2014, we found that in the aggregate, the average difference between the RUC recommended intraservice time and existing intraservice time was −17 percent, but the average difference between the RUC recommended work RVU and existing work RVU was only −4 percent. However, the average difference between the CMS refined work RVU and existing work RVU was −7 percent. For CY 2015, the average difference between the RUC recommended intraservice time and existing intraservice time was −17 percent, but the average difference between the RUC recommended work RVU and existing work RVU was 1 percent, and the average difference between the CMS refined work RVU and existing work RVU was −6 percent. This preliminary analysis demonstrates that we are not making refinements solely in consideration of time, if that were the case, the changes in the work RVU values that we adopted would be comparable to the changes in the time that we adopted, but that is not the case.

We believe that we should account for efficiencies in time when the recommended work RVU does not account for those efficiencies, otherwise relativity across the PFS can be significantly skewed over periods of time. For example, if when a code is first valued, a physician was previously able to do only 5 procedures per day, but due to new technologies, the same physician can now do 10 procedures per day, resource costs in time have empirically been lessened, and we believe that relative reduction in resources involved in furnishing that service should be accounted for in the assignment of work RVUs for that service, since the statute explicitly identifies time as one of the two components of work. Of course, if more resource intensive technology has allowed for the increased efficiency in furnishing the procedure, then the nonfacility PE RVUs for the service should also be adjusted to account for this change. Additionally, we believe it may be that the intensity per minute of the procedure may have changed with the greater efficiency in time. Again, that is why we do not generally reduce work RVUs in strict proportion to changes in time. We understand that intensity is not entirely linear, and that data related to time as obtained in the RUC survey instrument may improve over time, and that the number of survey respondents may improve over time. However, we also understand time as a tangible resource cost in furnishing PFS services, and a cost that by statute, is one of the two kinds of resources to be considered as part of the work RVU.

Therefore, we are interested in receiving comments on whether, within the statutory confines, there are alternative suggestions as to how changes in time should be accounted for when it is evident that the survey data and/or the RUC recommendation regarding the overall work RVU does not reflect significant changes in the resource costs of time for codes describing PFS services. We are also seeking comment on potential alternatives, including the application of the reverse building block methodology, to making the adjustments that would recognize overall estimates of work in the context of changes in the resource of time for particular services.

Table 16 contains a list of codes for which we are proposing work RVUs; this includes all RUC recommendations received by February 10, 2016, and codes for which we established interim final values in the CY 2016 PFS final rule with comment period. When the proposed work RVUs vary from those recommended by the RUC or for which we do not have RUC recommendations, we address those codes in the portions of this section that are dedicated to particular codes. The proposed work RVUs and other payment information for all proposed CY 2017 payable codes are available in Addendum B. Addendum B is available on the CMS Web site under downloads for the CY 2017 PFS proposed rule with comment period at http://www.cms.gov/​physicianfeesched/​downloads/​. The proposed time values for all CY 2017 codes are listed in a file called “CY 2017 PFS Proposed Work Time,” available on the CMS Web site under downloads for the CY 2017 PFS proposed rule with comment period at http://www.cms.gov/​physicianfeesched/​downloads/​.

3. Methodology for Proposing the Direct PE Inputs To Develop PE RVUs

a. Background

On an annual basis, the RUC provides us 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 PFS, consultation with 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 proposed refinements of the RUC's direct PE recommendations at the code-specific level. In this proposed rule, 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 proposed 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 proposed PE RVUs. This calculation Start Printed Page 46229considers 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 proposed refinements listed in Table 16 result in changes under the $0.32 threshold and are unlikely to result in a change to the proposed RVUs.

We also note that the proposed direct PE inputs for CY 2017 are displayed in the proposed CY 2017 direct PE input database, available on the CMS Web site under the downloads for the CY 2017 proposed rule at www.cms.gov/​PhysicianFeeSched/​. The inputs displayed there have also been used in developing the proposed CY 2017 PE RVUs as displayed in Addendum B.

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. The direct PE input recommendations generally correspond to the work time values associated with services. We believe that inadvertent discrepancies between work time values and direct PE inputs should be refined or adjusted in the establishment of proposed direct PE inputs to resolve the discrepancies.

(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 over several years of rulemaking, 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 preservice or postservice tasks performed by clinical labor staff on the day of the procedure (the clinical labor service period) and are typically available for other patients even when one member of the clinical staff may be occupied with a preservice or postservice 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 since any items in the room in question would be available if the room is not being occupied by a particular patient. For additional information, we refer readers to our discussion of these issues 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, 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, we review 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 preservice 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. This is because codes more recently reviewed would be more likely to have a greater number of clinical labor tasks as a result of the general tendency to increase the number of clinical labor tasks. 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.

(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 or that cannot be allocated to individual services or patients. We have addressed these kinds of recommendations in previous rulemaking (78 FR 74242), and we do not use items included in these recommendations as direct PE inputs in the calculation of PE RVUs.

(5) 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, however, 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 2017, we received invoices for several new supply and equipment items. Tables 16 and 17 detail the invoices received for new and existing items in the direct PE database. As discussed in section II.A. of this proposed rule with comment Start Printed Page 46230period, 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 during the 60-day public comment period for this proposed rule. We expect that invoices received outside of the public comment period would be submitted by February 10th of the following year for consideration in future rulemaking, similar to our new process for consideration of RUC recommendations.

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 16 and 17 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. A single invoice may not be reflective of typical costs and we 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.

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

Generally speaking, our proposed inputs do not include clinical labor minutes assigned to the service 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 address proposed code-specific refinements to clinical labor in the individual code sections.

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

We note that the public use files for the PFS proposed and final rules for each year display both the 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 1848(b)(4)(B) of the Act, and therefore, are subject to the OPPS cap for the upcoming calendar year. The public use files for CY 2017 are available on the CMS Web site under downloads for the CY 2017 PFS proposed rule with comment period at http://www.cms.gov/​Medicare-Fee-for-Service-Payment/​PhysicianFeeSched/​PFSFederal-Regulation-Notices.html.

4. Specialty-Mix Assumptions for Proposed Malpractice RVUs

The proposed CY 2017 malpractice crosswalk table is displayed in the public use files for the PFS proposed and final rules. The public use files for CY 2017 are available on the CMS Web site under downloads for the CY 2017 PFS proposed rule with comment period at http://www.cms.gov/​Medicare-Fee-for-Service-Payment/​PhysicianFeeSched/​PFSFederal-Regulation-Notices.html. The table lists the CY 2017 HCPCS codes and their respective source codes used to set the proposed CY 2017 MP RVUs where the source code for this calculation deviates from the source code for the utilization otherwise used for purposes of PFS ratesetting. The proposed MP RVUs for all PFS services and the utilization crosswalk used to identify the source codes for all other PFS codes are reflected in Addendum B on the CMS Web site at https://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​PhysicianFeeSched/​.

5. Valuation of Specific Codes

a. CY 2017 Proposed Codes That Were Also CY 2016 Proposed Codes

(1) Soft Tissue Localization (CPT Codes 10035 and 10036)

In the CY 2016 PFS final rule with comment period, we established the RUC-recommended work value as interim final for CPT codes 10035 and 10036. We also made standard refinements to remove duplicative clinical labor and utilize standard equipment time formulas for the PACS workstation proxy (ED050).

Comment: A commenter stated that the clinical labor task “Review/read X-ray, lab, and pathology reports” occurs during the preservice period, and it is a separate activity than “Review examination with interpreting MD”, which occurs during the service period.

Response: We continue to believe that this clinical labor is duplicative with the clinical labor for Review examination with interpreting MD because we believe that these two descriptors detail the same clinical labor activity taking place, rather than two separate and distinct tasks. We are proposing to maintain our previous refinement to 0 minutes for this clinical labor task for CPT codes 10035 and 10036.

We are also proposing to maintain the interim final work RVUs for CPT codes 10035 and 10036.

(2) Repair Flexor Tendon (CPT Codes 26356, 26357, and 26358)

In the CY 2016 PFS final rule with comment period, we established an interim final work RVU of 9.56 for CPT code 26356 after considering both its similarity in time to CPT code 25607 (Open treatment of distal radial extra-articular fracture) and the recommended reduction in time relative to the current times assumed for this procedure. We established an interim final work RVU of 10.53 for CPT code 26357 based on a direct crosswalk from CPT code 27654 (Repair, secondary, Achilles tendon, with or without graft), as we believed that this work RVU better reflected the changes in time for this procedure. For the last code in the family, we established an interim final work RVU of 12.13 for CPT code 26358, based on the RUC recommended increment of 1.60 work RVUs relative to CPT code 26357.

Comment: We received several comments regarding the interim final work values for this family of codes. Start Printed Page 46231One commenter stated that it was inappropriate to use time ratios to evaluate CPT code 26356 as it was last valued in 1995, noting that there was an anomalous relationship between the current work RVU and the imputed time components in the RUC database. This commenter also pointed out that when the previous time was developed, fabrication of a splint was considered to be part of the intraservice work, while in the current survey instrument, the fabrication of the splint is considered to be part of the postservice work since it is a dressing. This commenter urged CMS to adopt the RUC recommendations. A different commenter agreed that the CMS crosswalk to CPT code 25607 was an appropriate crosswalk for CPT code 26356 and supported the CMS work RVU of 9.56.

Response: We appreciate the support from the commenter. We continue to believe that our crosswalk for this code is an appropriate choice, due to our estimate of overall work between CPT code 26356 and CPT code 25607. We appreciate the commenters' concerns regarding the time ratio methodologies and have responded to these concerns about our methodology in section II.L.2 of this proposed rule. Although we note the commenter's statement about how the service period in which fabrication of a splint takes place may have evolved over time, we do not agree that this task would be responsible for a decrease in intraservice survey time, as the postservice survey time for CPT code 26356 remained unchanged at 30 minutes. If the decrease in intraservice time had been due to the shift of splinting from the intraservice period to the postservice period, then we would have expected to see an increase in the postservice period minutes. However, they remained exactly the same in the physician survey for CPT 26356. As we wrote earlier in this section, we believe in the validity of using pre-existing time values as a point of comparison, and we believe that we should account for efficiencies in time when the recommended work RVU does not account for those efficiencies. After consideration of comments received, we are proposing to maintain CPT code 26356 at its current work RVU of 9.56 for CY 2017.

Comment: Several commenters disagreed with the work RVU for CPT code 26357. One commenter stated that the CMS crosswalk to CPT code 27654 had less total time and resulted in an inappropriately lower intensity. This commenter urged CMS to adopt the RUC-recommended work value. Another commenter stated that a better crosswalk for CPT code 26357 would be CPT code 25608 (Open treatment of distal radial intra-articular fracture or epiphyseal separation), the next code in the same upper extremity family that CMS used for the initial crosswalk. This commenter stated that the CMS crosswalk for CPT code 26357 created a rank order anomaly in terms of intensity within this family, and that the commenter's suggested crosswalk would create two pairs of matched codes, survey CPT codes 26356/26357 with crosswalk CPT codes 25607/25608.

Response: We appreciate the suggested crosswalk from the commenters, and we agree that the choice of the initial CMS crosswalk creates a rank order anomaly within the family in terms of intensity. As a result, after consideration of comments received, we are proposing to instead value CPT code 26357 at the 25th percentile survey work RVU of 11.00 for CY 2017. This valuation corrects the anomalous intensity within the Repair Flexor Tendon family of codes, and preserves the RUC-recommended increment between CPT codes 26356 and 26357.

Comment: The commenters agreed that the RUC-recommended increment of 1.60 was appropriate for the work RVU of CPT code 26358 when added to the work RVU of CPT code 26357. However, commenters stated that this increment of 1.60 should be added to the RUC-recommended work value for CPT code 26357, and not the CMS refined value from the CY 2016 PFS final rule with comment period.

Response: We also continue to believe that the increment of 1.60 is appropriate for the work RVU of CPT code 26358. After consideration of comments received, we are therefore proposing to set the work RVU for this code at 12.60 for CY 2017, based on the increment of 1.60 from CPT code 26357's proposed work RVU of 11.00.

We are proposing to maintain the current direct PE inputs for all three codes.

(3) Esophagogastric Fundoplasty Trans-Oral Approach (CPT Code 43210)

For CY 2016, the CPT Editorial Panel established CPT code 43210 to describe trans-oral esophagogastric fundoplasty. The RUC recommended a work RVU of 9.00 for CPT code 43210. We noted our determination that a work RVU of 7.75, which corresponds to the 25th percentile survey result, more accurately reflects the resources used in furnishing the service associated with CPT code 43210. Therefore, for CY 2016 we established an interim final work RVU of 7.75 for CPT code 43210.

Comment: A few commenters urged CMS to accept the RUC-recommended work RVU of 9.00 for CPT code 43210. The commenters believed that the RUC-recommended value compared well with the key reference service, CPT code 43276 (Endoscopic retrograde cholangiopancreatography (ERCP); with removal and exchange of stent(s), biliary or pancreatic duct, including pre- and post-dilation and guide wire passage, when performed, including sphincterotomy, when performed, each stent exchanged), which has a work RVU of 8.94 and an intraservice time of 60 minutes. Commenters believed that due to similar intra-service times and intensities, that CPT code 43210 should be valued nearly identically to CPT code 43276. Some commenters also stated that to maintain relativity within the upper GI code families, CPT code 43210 should not have a lower work RVU than CPT code 43276, especially since the majority of survey participants indicated that CPT code 43210 is “somewhat more” complex than CPT code 43276. Additionally, one commenter noted that an EGD (Esophagogastroduodenoscopy) is used twice during this service, before and after fundoplication. They stated that because this is a multi-stage procedure, other EGD codes are not comparable. The commenter also pointed out that this technology has a small number of users and urged us to accept the RUC-recommended work RVU of 9.00 until there is increased volume and then reassess in 2 years. Commenters also requested refinement panel consideration for this service.

Response: Per the commenters' request, we referred this code to the CY 2016 multi-specialty refinement panel for further review. The result of the panel was a recommendation that we accept the RUC-recommended value of 9.00 work RVUs. However, since there are four ERCP codes with 60 minutes of intraservice time, three of which have work RVUs of less than 7.00 and only one of the four codes has a work RVU higher than 7.75 RVUs (8.94), based on our estimate of overall work for this service, we continue to believe that the 25th percentile of the survey most accurately reflects the relative resource costs associated with CPT code 43210. Therefore, for CY 2017 we are proposing a work RVU of 7.75 for CPT code 43210.

(4) Percutaneous Biliary Procedures Bundling (CPT Codes 47531, 47532, 47533, 47534, 47535, 47536, 47537, 47538, 47539, 47540, 47541, 47542, 47543, and 47544)

These codes were revalued with new recommendations at the October 2015 Start Printed Page 46232RUC meeting; we will discuss the CY 2016 interim final comments alongside the new recommendations. Please see section II.L for a discussion of the CY 2017 proposed code values.

(5) Percutaneous Image Guided Sclerotherapy (CPT Code 49185)

For CY 2016, we established an interim final work RVU of 2.35 for CPT code 49185 based on a crosswalk from CPT code 62305 (Myelography via lumbar injection, including radiological supervision and interpretation; 2 or more regions (e.g., lumbar/thoracic, cervical/thoracic, lumbar/cervical, lumbar/thoracic/cervical)); which we believed accurately reflected the time and intensity involved in furnishing CPT code 49185. We also requested stakeholder input on the price of supply item SH062 (sclerosing solution) as the volume of the solution in this procedure (300 mL) is much higher than other CPT codes utilizing SH062 (between 1 and 10 mL).

Comment: Commenters disagreed with our proposed crosswalk of CPT code 49185 from CPT code 62305. Commenters believed that the RUC-recommended crosswalk from CPT code 31622 (Bronchoscopy, rigid or flexible, including fluoroscopic guidance, when performed; diagnostic, with cell washing, when performed (separate procedure)) was a more appropriate comparison due to similarity in service. Commenters requested that CPT code 49185 be referred to the refinement panel.

Response: The requests did not meet the requirements related to new clinical information for referral to the refinement panel. After review of the comments, we continue to believe that a crosswalk of CPT code 49185 from the value for CPT code 62305 is most appropriate due to similarities in overall work. Therefore, we are proposing a work RVU of 2.35 for CPT code 49185 for CY 2017 and seek additional rationale for why a different work RVU or crosswalk would more accurately reflect the resources involved in furnishing this service.

Comment: A commenter stated that the procedure described by CPT code 49185 involved a separate clinical labor staff type. Due to the inclusion of this additional individual, the L037D clinical labor and additional gloves were appropriate to include in the procedure.

Response: The commenter did not provide any evidence for this claim. We continue to believe that this additional use of clinical staff would not be typical for CPT code 49185. This procedure does not involve moderate sedation, and therefore, we do not believe that there would be a typical need for a third staff member. As a result, we are proposing to maintain our direct PE refinements from the CY 2016 PFS final rule with comment period.

Additionally, we did not receive any information regarding SH062 that supports maintaining an input of 300 mL, and as noted above, this level far exceeds the volume associated with other CPT codes; therefore, we are proposing to refine the direct practice expense inputs for SH062 from 300 mL to 10 mL, which is the highest level associated with other CPT codes utilizing SH062.

(6) Genitourinary Procedures (CPT Codes 50606, 50705, and 50706)

In the CY 2016 PFS final rule with comment period, we established as interim final the RUC-recommended work RVUs for all three codes. We did not receive any comments on the work values for these codes, and we are proposing to maintain all three at their current work RVUs.

The RUC recommended the inclusion of “room, angiography” (EL011) for this family of codes. As we discussed in the CY 2016 PFS final rule with comment period, we did not believe that an angiography room would be used in the typical case for these procedures, and we therefore replaced the recommended equipment item “room, angiography” with equipment item “room, radiographic-fluoroscopic” (EL014) for all three codes on an interim final basis. We also stated our belief that since the predecessor procedure codes generally did not include an angiography room and we did not have a reason to believe that the procedure would have shifted to an angiography room in the course of this coding change, we did not believe that the use of an angiography room would be typical for these procedures.

Comment: Several commenters disagreed with the CMS substitution of the fluoroscopic room in place of the angiography room. The commenters stated that all three of these procedures were previously reported using CPT code 53899 (Unlisted procedure, urinary system) which does not have any PE inputs, and the RUC recommendations included as a reference CPT code 50387 (Removal and replacement of externally accessible transnephric ureteral stent), which includes an angiography room. The commenters suggested that CPT code 50387 was an example of a predecessor code that included the use of an angiography room, along with other codes that are being bundled together to create the new Genitourinary codes.

Response: We do not agree with the commenter's implication that because CPT code 50387 was an appropriate reference code for use in valuation, that it necessarily would have previously been used to describe services that are now reported under CPT codes 50606, 50705, or 50706. Our perspective is consistent with the RUC-recommended utilization crosswalk for the three new codes, which did not suggest that the services were previously reported using 50706. We do not believe that use of one particular code for reference in developing values for another necessarily means that the all of the same equipment would be used for both services.

We do not believe that these codes describe the same clinical work either. CPT code 50387 is for the “Removal and replacement of externally accessible transnephric ureteral stent” while CPT code 50606 describes an “Endoluminal biopsy of ureter and/or renal pelvis”, CPT code 50705 refers to “Ureteral embolization or occlusion”, and CPT code 50706 details “Balloon dilation, ureteral stricture.” Additionally, the codes do not have the same global periods, which makes comparisons between CPT code 50387 and CPT codes 506060, 50705, and 50706 even more difficult. We note that despite the commenter's claim that CPT code 50387 was provided as a reference for these procedures, 50387 is not in fact listed as a reference for any of these three codes, or mentioned at all in the codes' respective summary of recommendations. However, we acknowledge that among the procedures that are provided as references, many of them include the use of an angiography room, such as CPT code 36227 (Selective catheter placement, external carotid artery) and CPT code 37233 (Revascularization, endovascular, open or percutaneous, tibial/peroneal artery, unilateral, each additional vessel). Therefore, we agree that the use of the angiography room in these procedures, or at least some of its component parts, may be warranted.

Comment: A commenter stated that the substitution of the fluoroscopic room for the angiography room was clinically unjustified. The commenter stated that the angiography room was needed for these procedures to carry out 3-axis rotational imaging (so as to avoid rolling the patient), ensure sterility, and avoid unacceptable radiation exposure to physicians, their staff, and their patients. The commenter indicated that the only piece of equipment listed in the angiography room that would not be typically utilized for these procedures is the Provis Injector. All of the other Start Printed Page 46233items are used for these Genitourinary procedures. The commenter urged CMS to restore the angiography room to these procedures.

Response: We agree that it is important to provide equipment that is medically reasonable and necessary. Our concern with the use of the angiography room for these codes is that we do not believe all of the equipment would be typically necessary to furnish the procedure. For example, the commenter agreed that the Provis Injector would not be required for these Genitourinary codes. Therefore, we are proposing to remove the angiography room from these three procedures and add in its place the component parts that make up the room. Table 16 details these components:

Table 16—Angiography Room (EL011) Components

100 KW at 100 kV (DIN6822) generator
C-arm single plane system, ceiling mounted, integrated multispace
T motorized rotation, multiple operating modes
real-time digital imaging
40 cm image intensifier at 40/28/20/14cm
30 × 38 image intensifier dynamic flat panel detector
floor-mounted patient table with floating tabletop designed for angiographic exams and interventions (with peistepping for image intensifiers 13in+)
18 in TFT monitor
network interface (DICOM)
Careposition: Radiation free positioning of collimators
Carewatch: Acquisition and monitoring of configurable dose area product
Carefilter: Cu-prefiltration
DICOM HIS/RIS
Control room interface
Injector, Provis
Shields, lower body and mavig
Leonardo software
Fujitsu-Siemens high performance computers
Color monitors
Singo modules for dynamic replay and full format images
Prepared for internal networking and Siemens remote servicing, both hardware and software

We will include all of the above components except the Provis Injector, as commenters have indicated that its use would not be typical for these procedures. We welcome additional comment regarding if these or other components are typically used in these Genitourinary procedures. We currently lack pricing information for these components; we are therefore proposing to include each of these components in the direct PE input database at a price of $0.00 and we are soliciting invoices from the public for their costs so that we may be able to price these items for use in developing final PE RVUs for CY 2017

We also note that we believe that this issue illustrates a potentially broad problem with our use of equipment “rooms” in the direct PE input database. For most services, we only include equipment items that are used and unavailable for other uses due to their use during the services described by a particular code. However, for items included in equipment “rooms,” we allocate costs regardless of whether the individual items that comprise the room are actually used in the particular service.

To maintain relativity among different kinds of procedures, we are interested in obtaining more information specifying the exact resources used in furnishing services described by different codes. We hope to address this subject in greater detail in future rulemaking.

(7) Laparoscopic Radical Prostatectomy (CPT code 55866)

In the CY 2016 PFS final rule with comment period, we established an interim final work RVU of 21.36 for CPT code 55866 based on a direct crosswalk to CPT code 55840 (Prostatectomy, retropubic radical, with or without nerve sparing). We stated that we believed these codes were medically similar procedures with nearly identical time values, and we did not believe that the difference in intensity between CPT code 55840 and CPT code 55866 was significant enough to warrant the RUC-recommended difference of 5.50 work RVUs. We also compared CPT code 55866 to the work RVU of 25.18 for CPT code 55845, and stated our belief that, in general, a laparoscopic procedure would not require greater resources than an open procedure.

Comment: Several commenters disagreed with the statement that a laparoscopic procedure, such as CPT code 55866, would generally require fewer resources than an open procedure, such as CPT code 55840. Commenters stated that developing the skill necessary to perform a minimally invasive laparoscopic surgery requires a greater degree of experience and specialized training than that required to perform an open prostatectomy. Commenters indicated that this level of practitioner skill should be reflected in the work RVU for the procedure, as intensity is based in part upon skill, mental effort, and psychological stress.

Response: We agree with the commenters that skill and technique as well as mental effort and psychological stress on the part of the practitioner contribute to the overall intensity of the furnishing a given service, and therefore, are one of the two components in determining code-level work RVUs. However, we do not believe that relative increases in requisite skill or technique can be considered alone. Although the development of new technology (such as robotic assistance) may create a greater burden of knowledge on the part of the practitioner, it can also make procedures faster, safer, and easier to perform. This means that there may be reductions in time for such a procedure (which is the other component of the work RVU), but also that the mental effort and psychological stress for a given procedure may be mitigated by the improvements in safety. Therefore, we do not agree that a newer procedure that includes additional technology and requires greater training would inherently be valued at a higher rate than an older and potentially more invasive procedure.

Comment: A commenter stated that CPT code 55866 describes two very different procedures in one code. The descriptor for the code states “includes robotic assistance when performed”, and the procedure is performed differently depending on whether or not the robotic assistance is included. The commenter indicated that the vast majority of radical prostatectomies are performed with the robot, and although the outcomes are the same in both cases, the procedures are completely different.

Response: We agree with the commenter that the descriptor includes the possibility for confusion, especially on the part of the survey respondents. Valuing this code based on the typical case is difficult when the procedure differs depending on the inclusion or exclusion of robotic assistance. We would recommend that valuation might be improved if the CPT Editorial Panel were to consider further revisions to this code to describe the two cases of laparoscopic radical prostatectomy: With and without robotic assistance.

Comment: One commenter stated that the application of the phase-in transition for facility-only codes like CPT code 55866 would have a particularly egregious impact in the second year of the transition. The commenter urged CMS to ensure that its implementation of the phase-in transition does not undermine the protections created by the statute.

Response: Please see Sections II.G and II.H or a discussion of the phase-in transition and its implementation in its second year.

Comment: Several commenters requested that CMS refer CPT code 55866 to the refinement panel for Start Printed Page 46234review. At the refinement panel, the presenters brought up new evidence in the form of a study published in 2016 describing discharge data for radical laparoscopic prostatectomies. The presenters stated that there were many more people included in this study as opposed to the 30 respondents in the survey data, and that on average the robotic procedure took 90 minutes longer than the open procedure. The additional time needed to perform the procedure, as indicated by this new study's results, was presented as a new rationale as to why CMS should accept the RUC-recommended work RVU.

Response: CPT code 55866 was referred to the CY 2016 Multi-Specialty Refinement Panel per the request of commenters. The outcome of the refinement panel was a median work RVU of 26.80, the same value as the RUC recommended in the previous rulemaking cycle. After consideration of the comments and the results of the refinement panel, we are proposing for CY 2017 to maintain the interim final work RVU of 21.36 for CPT code 55866. We are interested in the results of the study mentioned at the refinement panel, and we will consider incorporating this data into the valuation of this code, including, if appropriate, adjustments to the work times used in PFS ratesetting. We are also seeking that the study be submitted through the public comment process so that we can allow it proper consideration along with other information submitted by the public, rather than using the results of a single study to propose valuations. We are also curious about the time values regarding the duration of CPT code 55866. One of the members of the refinement panel stated that on average the robotic procedure took 90 minutes longer than the open procedure. This is not what was indicated by the survey data from the RUC recommendations, which had the two procedures valued at virtually identical times (same intraservice time, 6 minutes difference total time). We are therefore seeking comment on whether the times included in this study are more accurate than the time reflected in the RUC surveys.

(8) Intracranial Endovascular Intervention (CPT codes 61645, 61650, and 61651)

For CY 2016, we established interim final work RVUs of 15.00 for CPT code 61645, 10.00 for CPT code 61650 and 4.25 for CPT code 61651. The RUC-recommended values for CPT codes 61645, 61650 and 61651 were 17.00, 12.00 and 5.50, respectively. We valued CPT code 61645 by applying the ratio between the RUC-recommended reference code's, CPT 37231 (revascularization, endovascular, open or percutaneous, tibial, peroneal artery, unilateral, initial vessel; with transluminal stent placement(s) and atherectomy, includes angioplasty within the same vessel, when performed), work and time to CPT code 61645. We valued CPT code 61650 based on a crosswalk to CPT code 37221 (revascularization, endovascular, open or percutaneous, iliac artery, unilateral, initial vessel; with transluminal stent placement(s), includes angioplasty within the same vessel, when performed), due to similar intensity and intraservice time. We valued CPT code 61651 based on a crosswalk to CPT code 37223 (revascularization, endovascular, open or percutaneous, iliac artery, each additional ipsilateral iliac vessel; with transluminal stent placement(s), includes angioplasty within the same vessel, when performed (list separately in addition to the code for primary procedure, due to similar intraservice time and intensity.

Both CPT codes 61645 and 61650 included postservice work time associated with CPT code 99233 (Subsequent hospital care, per day, for the evaluation and management of a patient, which requires at least 2 of these 3 key components: A detailed interval history; A detailed examination; Medical decision making of high complexity. Counseling and/or coordination of care with other physicians, other qualified health care professionals, or agencies are provided consistent with the nature of the problem(s) and the patient's and/or family's needs. Usually, the patient is unstable or has developed a significant complication or a significant new problem. Typically, 35 minutes are spent at the bedside and on the patient's hospital floor or unit). In the CY 2016 PFS final rule with comment period, we stated that we believe that for the typical patient, these services would be considered hospital outpatient services, not inpatient services. As a result the intraservice time of the hospital observation care service was valued in the immediate postservice time. We refined the work time for CPT code 61645 by removing 55 minutes of work time associated with CPT code 99233, and added 30 minutes of time from CPT code 99233 to the immediate postservice. Therefore the total time for CPT code 61645 was reduced to 241 minutes and the immediate postservice time increased to 83 minutes. We also removed the inpatient visit from CPT code 61650, which reduced the total time to 206 minutes and increased the postservice time to 75 minutes.

Comment: Commenters disagreed with our categorization of these codes as outpatient only, and therefore, subject to the 23-hour outpatient policy. Commenters stated that according to Medicare claims data, the predecessor codes were performed primarily on an inpatient basis. Additionally, commenters pointed out that the new codes would typically be performed on acute stroke patients. Commenters also said as the new codes are inpatient-only, the CMS reductions in work and time based on the assumption of outpatient status are flawed; as a result, commenters suggested we accept the RUC-recommended values. Commenters also requested that these codes be referred to the refinement panel.

Response: We valued CPT codes 61645, 61650, and 61651 based on comparisons to reference CPT codes 37231, 37221, and 37223, respectively. We continue to believe that these codes are appropriate comparisons based on intensity and intra-service time because no persuasive information was presented at the refinement panel that indicated that these comparisons are not appropriate. Therefore we are proposing an RVU of 15.00 for CPT code 61645, 10.00 for CPT code 61650, and 4.25 for CPT code 61651. We are also proposing time inputs based on our refinements of the RUC recommendations, including removing the time associated with hospital inpatient visit CPT code 99233 from the intraservice work time, and adding 30 minutes to the immediate postservice time for both CPT codes 61645 and 61650.

We are also seeking comment on the inclusion of post-operative visits in a 0-day global. Both CPT codes 61645 are 0-day global codes, and the refinements described above reflect changes to more appropriate value these codes as 0-day codes. We do not believe that 0-day globals codes should include post-operative visits; rather, if global codes require post-operative visits, they are more appropriately assigned 10- or 90-day global periods based on our current criteria. Our policy has been to remove the visit from the post-operative period and the associated minutes from the total time while adding 30 minutes to the immediate postservice period without necessarily making an adjustment to the work RVU (see the CY 2010 PFS proposed rule, 74 FR 33557; also see the CY 2011 PFS proposed rule, 75 FR 40072).Start Printed Page 46235

(9) Paravertebral Block Injection (CPT codes 64461, 64462, and 64463)

In CY 2015, the CPT Editorial Panel created three new codes to describe paravertebral block injections at single or multiple levels, as well as for continuous infusion for the administration of local anesthetic for post-operative pain control and thoracic and abdominal wall analgesia. For the CY 2016 PFS final rule with comment period, we established the RUC-recommended work RVUs, 1.75 and 1.10, as interim final for CPT codes 64461 and 64462, respectively.

For CPT code 64463, we utilized a direct crosswalk from three other injection codes (CPT codes 64416 (Injection, anesthetic agent; brachial plexus, continuous infusion by catheter (including catheter placement), 64446 (Injection, anesthetic agent; sciatic nerve, continuous infusion by catheter (including catheter placement), and 64449 (Injection, anesthetic agent; lumbar plexus, posterior approach, continuous infusion by catheter (including catheter placement)) which all had a work RVU of 1.81 as we believed this crosswalk more accurately reflected the work involved in furnishing this service.

Comment: The RUC stated that CPT code 64463 is more comparable to CPT code 64483 (Injection(s), anesthetic agent and/or steroid, transforaminal epidural, with imaging guidance (fluoroscopy or CT); lumbar or sacral, single), which has a work RVU of 1.90 and requires the same physician work and time to perform. The RUC recommended we accept the 25th percentile survey work RVU of 1.90. Another commenter stated that our value for CPT code 64463 was inappropriate since imaging guidance is not part of our comparison codes. The commenter advocated for us to accept the survey respondent's selection of CPT code 64483 as the most appropriate comparison code and assign a work RVU of 1.90.

Response: After reviewing and considering the comments, we continue to believe that CPT codes 64416, 64446, and 64449, all of which have 20 minutes of intraservice time, are better crosswalks to CPT code 64463, which also has 20 minutes of intraservice time and a similar total time. In contrast, the crosswalk code recommended by commenters, CPT 64483, only has 15 minutes of intraservice time. Therefore, we are proposing a work RVU of 1.81 for CPT code 64463 for CY 2017.

(10) Implantation of Neuroelectrodes (CPT codes 64553 and 64555)

The RUC identified CPT codes 64553 and 64555 as a site of service anomaly during the CY 2016 PFS rulemaking cycle. In the Medicare claims data, these services were typically reported in the nonfacility setting, yet the survey data was predicated on a facility-based procedure. We agreed with the RUC that these two codes should be referred to the CPT Editorial Panel to better define the services, in particular to investigate the possibility of establishing one code to describe temporary or testing implantation and another code to describe permanent implantation. We maintained the CY 2015 work RVUs and direct PE inputs for these two codes on an interim basis until receiving updated recommendations from CPT and the RUC.

Comment: A commenter requested that CMS allow practitioners to bill the MACs separately for a percutaneous electrode kit (SA022) for CPT code 64555. The commenter stated that without allowing for a separate payment for the percutaneous electrode kit, the payment for the procedure would be insufficient to cover the physician's costs.

Response: We agree that CPT codes 64553 and 64555 as currently constructed are potentially misvalued codes, which is why we are maintaining the CY 2015 work RVUs and direct PE inputs on an interim basis. We believe that the disposable supplies furnished incident to the procedure are paid through the nonfacility PE RVUs. The percutaneous electrode kit (SA022) was not previously included in the direct PE inputs for either of these two services, and since we are proposing to maintain current direct PE inputs pending additional recommendations, we do not agree that disposable supplies should be separately payable. We are proposing to maintain the interim final work RVUs and direct PE inputs for these two codes, and we look forward to reviewing recommendations regarding these procedures again for future rulemaking.

Additionally, we were alerted to a discrepancy regarding the times for these codes in the CY 2016 work time file. Our proposed CY 2017 work time file addresses this discrepancy by reflecting the RUC recommended times of 155 minutes for CPT code 64553 and 140 minutes for CPT code 64555.

(11) Ocular Reconstruction Transplant (CPT code 65780)

In CY 2015, the RUC identified CPT code 65780 as potentially misvalued through a misvalued code screen for 90-day global services that included more than 6 office visits. The RUC recommended a direct work RVU crosswalk from CPT code 27829 (Open treatment of distal tibiofibular joint (syndesmosis) disruption, includes internal fixation, when performed). After examining comparable codes, we determined the RUC-recommended work RVU of 8.80 for CPT code 65780 would likely overstate the work involved in the procedure given the change in intraservice and total times compared to the previous values. We believed that the ratio of the total times (230/316) applied to the work RVU (10.73) more accurately reflected the work involved in this procedure. Therefore, we established an interim final work RVU of 7.81 for CPT code 65780.

Comment: The RUC and other commenters disagreed with our interim final values based on objections to our use of time ratios in developing work RVUs for PFS services.

Response: We appreciate the commenters' concerns and have responded to these concerns about our methodology in section II.L of this proposed rule. After review of the comments, we continue to consider the work RVU of 7.81 to accurately represent the work involved in CPT code 65780. We believe this service is similar in overall intensity to CPT code 27766 (Open treatment of medial malleolus fracture, includes internal fixation, when performed) that has a work RVU of 7.89 and a total time that more closely approximates that of CPT code 65780. Therefore, we are proposing a work RVU of 7.81 for CPT code 65780 for CY 2017.

(12) Trabeculoplasty by Laser Surgery (CPT code 65855)

In CY 2015, the RUC identified CPT code 65855 as potentially misvalued through the review of 10-day global services with more than 1.5 postoperative visits. The RUC noted that the code was changed from a 90-day to a 10-day global period when it was last valued in 2000. However, the descriptor was not updated to reflect that change. CPT code 65855 describes multiple laser applications to the trabecular meshwork through a contact lens to reduce intraocular pressure. The current practice is to perform only one treatment session during a 10-day period and then wait for the effect on the intraocular pressure. The descriptor for CPT code 65855 has been revised and removes the language “1 or more sessions” to clarify this change in practice.Start Printed Page 46236

The RUC recommended a work RVU of 3.00 for CPT code 65855. While the RUC-recommended value represents a reduction from the CY 2015 work RVU of 3.99, we stated that significant reductions in the intraservice time, the total time, and the change in the office visits represent a more significant change in the work resources involved in furnishing the typical service. The intraservice and total times were decreased by approximately 33 percent while the elimination of two post-operative visits (CPT code 99212) alone would reduce the overall work RVU by at least 24 percent under the reverse building block method. However, the RUC-recommended work RVU only represents a 25 percent reduction relative to the previous value. To identify potential work RVUs for this service, we calculated an intraservice time ratio between the CY 2015 intraservice time, 15 minutes, and the RUC-recommended intraservice time, 10 minutes, and applied this ratio to the current work RVU of 3.99 to arrive at a work RVU of 2.66 for CPT code 65855, which we established as interim final for CY 2016.

Comment: A few commenters, including the RUC, provided explanations as to how the RUC recommendation had already accounted for the reduction in physician intra-service time and post-operative visits. Some commenters disagreed with CMS' interim final values based on objections to CMS' use of time ratios in developing work RVUs for PFS services.

Response: We appreciate the commenters' concerns regarding the time ratio methodologies and have responded to these concerns about our methodology in section II.H.2 of this proposed rule. After considering the explanations provided by commenters through public comments describing the RUC's methodologies in more detail, we agree that the proposed value did not accurately reflect the physician work involved in furnishing the service. Therefore, for CY 2017 we are proposing the RUC-recommended work RVU value of 3.00 for CPT code 65855.

(13) Glaucoma Surgery (CPT codes 66170 and 66172)

The RUC identified CPT codes 66170 and 66172 as potentially misvalued through a screen for 90-day global codes that included more than 6 office visits). We believed the RUC-recommended work RVU of 13.94 for CPT code 66170 did not accurately account for the reductions in time. Specifically, the survey results indicated reductions of 25 percent in intraservice time and 28 percent in total time. These reductions suggested that the RUC-recommended work RVU for CPT code 66170 overstated the work involved in furnishing the service, since the recommended value only represented a reduction of approximately seven percent. We believed that applying the intraservice time ratio, the ratio between the CY 2015 intraservice time, 60 minutes, and the RUC-recommended intraservice time, 45 minutes, applied to the current work RVU, 15.02, resulted in a more appropriate work RVU. Therefore, for CY 2016, we established an interim final work RVU of 11.27 for CPT code 66170.

For CPT code 66172, the RUC recommended a work RVU of 14.81. After comparing the RUC-recommended work RVU for this code to the work RVU for similar codes (for example, CPT code 44900 (Incision and drainage of appendiceal abscess, open) and CPT code 52647 (Laser coagulation of prostate, including control of postoperative bleeding, complete (vasectomy, meatotomy, cystourethroscopy, urethral calibration and/or dilation, and internal urethrotomy are included if performed))), we believed the RUC-recommended work RVU of 14.81 overstated the work involved in this procedure. For the same reasons and following the same valuation methodology utilized above, we applied the intraservice time ratio between the CY 2015 intraservice time and the survey intraservice time, 60/90, to the CY 2015 work RVU of 18.86. This resulted in a work RVU of 12.57 for CPT code 66172. Therefore, for CY 2016, we established an interim final work RVU of 12.57 for CPT code 66172.

Comment: Several commenters, including the RUC, disagreed with our interim final values based on objections to our use of time ratios in developing work RVUs for PFS services. Commenters also requested CMS refer CPT codes 66170 and 66172 to the refinement panel.

Response: We appreciate the commenters' concerns regarding the time ratio methodologies and have responded to these concerns in section II.H.2 of this proposed rule. CPT codes 66170 and 66172 were referred to the CY 2016 multi-specialty refinement panel per commenters' request. The outcome of the refinement panel was a median of 13.94 RVUs for CPT code 66170 and 14.84 RVUs for CPT code 66172. Due to the new information presented to the refinement panel regarding the level of intensity required to perform millimeter incisions in the eye, we agree with the assessment of the refinement panel and therefore, for CY 2017 we are proposing a work RVU of 13.94 for CPT code 66170 and 14.84 for CPT code 66172.

(14) Retinal Detachment Repair (CPT codes 67107, 67108, 67110, and 67113)

CPT codes 67107, 67108, 67110 and 67113 were identified as potentially misvalued through a screen for 90-day global post-operative visits. The RUC recommended a work RVU of 16.00 for CPT code 67107, which corresponded to the 25th percentile of the survey. While the RUC recommendation represented a five percent reduction from the current work RVU of 16.71, we believed the RUC recommendation still overvalued the service given the 15 percent reduction in intraservice time and 25 percent reduction in total time. We used the intraservice time ratio between the existing and new time values to identify an interim final work RVU of 14.06. We believed this value accurately reflected the work involved in this service and was comparable to other codes that have the same global period and similar intraservice time and total time. For CY 2016, we established an interim final work RVU of 14.06 for CPT code 67107.

For CPT code 67108, the RUC recommended a work RVU of 17.13 based on the 25th percentile of the survey, which reflected a 25 percent reduction from the current work RVU. The survey results reflected a 53 percent reduction in intraservice time and a 42 percent reduction in total time. We believe the RUC-recommended work RVU overestimated the work, given the significant reductions in intraservice time and total time and does not maintain relativity among the codes in this family. To determine the appropriate value for this code and maintain relativity within the family, we preserved the 1.13 work RVU increment recommended by the RUC between this code and CPT code 67107 and applied that increment to the interim final work RVU of 14.06 for CPT code 67107. Therefore, we established an interim final work RVU of 15.19 for CPT code 67108.

For CPT code 67110, the RUC recommended maintaining the current work RVU of 10.25. To maintain appropriate relativity with the work RVUs established for the other services within this family, we used the RUC-recommended −5.75 RVU differential between CPT code 67107 and CPT code 67110 to establish the CY 2016 interim final work RVU of 8.31 for CPT code 67110. For CPT code 67113, the RUC recommended and we established an interim final work RVU of 19.00 based on the 25th percentile of the survey.Start Printed Page 46237

Comment: Several commenters, including the RUC, disagreed with our interim final values based on objections to our use of time ratios in developing work RVUs for PFS services. Some commenters also stated that by using some RUC-recommended increments and rejecting others, we have not only established inconsistencies within the family of codes, but potentially opened up anomalies across a wide range of services. The RUC also expressed disagreement with using the recommended work RVU increments without using the recommended work RVU. Some commenters also stated the new IWPUT values for these three services are inappropriately low and pointed to the derived per minute intensity of 0.064 for CPT code 67110 as particularly problematic.

Response: We appreciate the commenters' concerns regarding the time ratio methodologies and have responded to these concerns in section II.H.2 of this proposed rule. We disagree with the statement about inconsistencies as the codes in this family are valued relative to one another based on the times and level of physician work required for each code. Also, we generally do not agree that a low IWPUT itself indicates overall misvaluation as the validity of the IWPUT as a measure of intensity depends on the accuracy of the assumptions regarding the number, level, and work RVUs attributable to visits for services in the post-operative global period for individual services. For example, a service with an unrealistic number or level of post-operative visits may have a very low derived intensity for the intra-service time.

CPT codes 67107, 67108, and 67110 were referred to the CY 2016 multi-specialty refinement panel per commenters' request. The outcome of the refinement panel was a median of 16.00, 17.13, and 10.25 work RVUs; respectively. After consideration of the comments and the results of the refinement panel, we are proposing a work RVU of 16.00, 17.13, and 10.25 for CPT codes 67107, 67108, and 66110, respectively, for CY 2017.

(15) Fetal MRI (CPT Codes 74712 and 74713)

For CY 2016, we established the RUC-recommended work RVU of 3.00 as interim final for CPT code 74712. We established an interim final work RVU of 1.78 for CPT code 74713 based on a refinement of the RUC-recommended work RVU of 1.85 using the ratio of work to time for both codes. This proposed value also corresponds to the 25th percentile survey result.

Comment: Commenters stated that the work RVU of 1.78 for CPT code 74713 did not reflect the higher intensity inherent in the procedure's typical patient. The commenter explained that the typical patient is pregnant with twins and has a higher likelihood of complications related to congenital anomalies, as well as of ischemic brain injury with twin gestations. The commenter further stated that twin gestations are more difficult to image. Commenters requested that CPT code 74713 be referred to the multispecialty refinement panel.

Response: CPT code 74713 was referred to the CY 2016 multispecialty refinement panel. After considering the comments and the results of the refinement panel, we agree with commenters that an RVU of 1.78 underestimates the work for CPT code 74713. Therefore, we propose a work RVU of 1.85 for the service for CY 2017.

(16) Interstitial Radiation Source Codes (CPT Codes 77778 and 77790)

In CY 2016 PFS final rule with comment period, we established an interim final value for CPT code 77790 without a work RVU, consistent with the RUC's recommendation. We did not use the RUC-recommended work RVU to establish the interim final values for CPT code 77778. We stated that the specialty society survey included a work time that was significantly higher than the RUC-recommended work time without a commensurate change in RVU. For CY 2016, we established the 25th percentile work RVU survey result of 8.00 as interim final for CPT code 77778.

Comment: Commenters agreed that the preservice survey times and the RUC-recommended survey times were inconsistent and explained that this inconsistency resulted from the RUC's use of preservice packages in developing recommendations. In addition, commenters stated that because the work associated with CPT code 77790 (including pre-time supervision, handling, and loading of radiation seeds into needles) was bundled into CPT code 77778, that the additional work should be reflected in the RVU for CPT code 77778. Commenters encouraged us to accept the RUC-recommended work RVU of 8.78 and requested that CPT code 77778 be referred to the refinement panel.

Response: We did not refer CPT code 77778 to the CY 2016 multispecialty refinement panel because commenters did not provide new clinical information. We continue to believe that, based on the reduction in total work time, an RVU of 8.00 accurately reflects the work involved in furnishing CPT code 77778. Therefore for CY 2017, we are proposing a work RVU of 8.00 for CPT code 77778 and 0 work RVUs for CPT code 77790. We are also seeking comment on whether we should use time values based on preservice packages if the recommended work value is based on time values that are significantly different than those ultimately recommended.

(17) Colon Transit Imaging (CPT Codes 78264, 78265, and 78266)

In establishing CY 2016 interim final values, we accepted the RUC-recommended work RVUs for CPT codes 78265 and 78266. We believed that the RUC-recommended RVU of 0.80 overestimated the work involved in furnishing CPT code 78264 and as a result, we established an interim final work RVU of 0.74 based on a crosswalk to CPT code 78226 (hepatobiliary system imaging, including gallbladder when present), due to similar intraservice times and intensities.

Comment: Commenters did not support our interim final work RVU for CPT code 78264. Commenters disagreed with our assessment of CPT code 78264 as having a higher work RVU and shorter intraservice time relative to the other codes in the family. One commenter stated that a difference of two minutes in intraservice time was insignificant and should not be used as a rationale for revaluing. Another commenter stated that we should have maintained the RUC-recommended crosswalk of CPT code 78264 to CPT code 78227 (Hepatobiliary system imaging, including gallbladder when present; with pharmacologic intervention, including quantitative measurement(s) when performed) due to similarities in service, work and intensity. Based on these concerns, commenters requested that CPT code 78264 be referred to the refinement panel.

Response: CPT code 78264 was referred to the CY 2016 multi-specialty refinement panel for further review. We calculate the refinement panel results as the median of each vote. That result for CPT code 78264 was 0.79 RVUs. After consideration of the comments and the refinement panel results, we agree that 0.79 accurately captures the overall work involved in furnishing this service and are proposing a value of 0.79 for CPT code 78264.Start Printed Page 46238

(18) Cytopathology Fluids, Washings or Brushings and Cytopathology Smears, Screening, and Interpretation (CPT Codes 88104, 88106, 88108, 88112, 88160, 88161, and 88162)

In the CY 2016 PFS final rule with comment period, we made a series of refinements to the recommended direct PE inputs for this family of codes. We removed the equipment time for the solvent recycling system (EP038) and the associated clinical labor described by the tasks “Recycle xylene from stainer” and “Order, restock, and distribute specimen containers and or slides with requisition forms” due to our belief that these were forms of indirect PE. This refinement applied to all seven codes in the family. We also noticed what appeared to be an error in the quantity of non-sterile gloves (SB022), impermeable staff gowns (SB027), and eye shields (SM016) assigned to CPT codes 88108 and 88112. The recommended value of these supplies was a quantity of 0.2, which we believed was intended to be a quantity of 2. We therefore refined the value of these supplies to 2 for CPT codes 88108 and 88112.

Comment: Several commenters disagreed with our characterization of the solvent recycling system and its associated clinical labor tasks as indirect PE. Commenters stated that the solvent recycling system costs are direct expenses since they are based on the amount of recycled solvent allocated to each specimen, with solvents allocated to specific specimens based on batch size. They indicated that the related clinical labor tasks are also forms of direct PE as they are also based on the amount of recycled solvent allocated to each specimen. The time for these tasks varies based on the batch size, which varies by procedure.

Response: We maintain our previously stated belief that these are forms of indirect PE, as they are not allocated to any individual service. We have defined direct PE inputs as clinical labor, medical supplies, or medical equipment that are individually allocable to a particular patient for a particular service. We continue to believe that a solvent recycling system would be in general use for a lab practice, and that the associated clinical labor tasks for ordering and restocking specimen containers can be more accurately described as administrative activities. We are proposing to maintain these refinements from the previous rulemaking cycle for CPT codes 88104-88162.

Comment: A commenter indicated that we did not account for the batch size when considering the supply quantities for CPT codes 88108 and 88112. The commenter indicated that the practice expense inputs should be assumed to have a batch size of five for these two codes, and therefore, no edits should be made. The commenter requested that we restore the quantity of 0.2 for the gloves, gowns, and eye shields associated with these procedures. This did not apply to the other codes on the submitted spreadsheet, which had a batch size of one.

Response: We appreciate the assistance of the commenter in clarifying the batch size for these procedures. As a result, we are proposing to refine the supply quantity of the non-sterile gloves (SB022), impermeable staff gowns (SB027), and eye shields (SM016) back to the RUC-recommended value of 0.2 for CPT codes 88108 and 88112.

(19) Immunohistochemistry (CPT Codes 88341, 88342, 88344, and 88350)

In the CY 2014 PFS final rule with comment period (78 FR 74341), we assigned a status indicator of I (Not valid for Medicare purposes) to CPT codes 88342 and 88343 and instead created two G-codes, G0461 and G0462, to report immunohistochemistry services. We did this in part to avoid creating incentives for overutilization. For CY 2015, the CPT coding was revised with the creation of two new CPT codes, 88341 and 88344, the revision of CPT code 88342 and the deletion of CPT code 88343. In the past for similar procedures in this family, the RUC recommended a work RVU for the add-on code (CPT code 88364) that was 60 percent of the base code (CPT code 88365). In the CY 2015 PFS final rule with comment period, we stated that the relative resources involved in furnishing an add-on service in this family would be reflected appropriately using the same 60 percent metric and subsequently established an interim final work RVU of 0.42 for CPT code 88341, which was 60 percent of the work RVU of the base CPT code 88342 (0.70). In the CY 2016 PFS proposed rule, we revised the add-on codes from 60 percent to 76 percent of the base code and subsequently revalued CPT code 88341 at 0.53 work RVUs. However, we inadvertently published work RVUs for CPT code 88341 in Addendum B without explicitly discussing it in the preamble text. In the CY 2016 PFS final rule with comment period, we maintained CPT code 88341's CY 2015 work RVU of 0.53 as interim final for CY 2016 and requested public comment. Also, in the CY 2016 PFS final rule with comment period, we established an interim final value of 0.70 work RVUs for CPT codes 88342 and 88344.

Comment: Several commenters expressed their opposition to a standard discount for the physician work involved in pathology add-on services and urged us to accept the RUC-recommend value of 0.65 RVUs for CPT code 88341.

Response: We appreciate commenters' concerns regarding a standard discount; however, we believe that it is reasonable to estimate work RVUs for a base and an add-on code, and to recognize efficiencies between them, by looking at how similar efficiencies are reflected in work RVUs for other PFS services. Also we note that the intravascular codes for which we initially established our base/add-on code relationship for CPT codes 88346 and 88350 were deleted in CY 2016 and replaced with two new codes; CPT codes 37252 and 37253. The relationship between 37252 and 37253 represents a 20 percent discount for the add-on code as the base CPT code 37252 has a work RVU of 1.80 and 37523 and work RVU of 1.44. As CPT codes 37252 and 37253 replaced the codes on which our discounts for base and add-on codes were based (please see the CY 2016 PFS final rule with comment period (80 FR 70972) for a detailed discussion) we believed it would be appropriate to maintain the same 20 percent relationship for 88346 and 88350. Therefore, for CY 2017, we are proposing a work RVU of 0.56 for CPT code 88341, which represents 80 percent of 0.70, the work RVU of the base code.

For CY 2016, we finalized a work RVU of 0.56 for CPT code 88350 which represented 76 percent of 0.74, the RVU for the base code. To maintain consistency within this code family, we are proposing to revalue CPT code 88350 using the 20 percent discount discussed above. To value CPT code 88350, we multiplied the work RVU of CPT code 88346, 0.74, by 80 percent, and then subtracted the product from 0.74, resulting in a work RVU of 0.59 for CPT code 88350. Therefore, for CY 2017, we are proposing a work RVU of 0.59 for CPT code 88350.

A stakeholder has suggested to us that an error was made in the implementation of direct PE inputs for code 88341 and several other related codes. This stakeholder stated that when CMS reclassified equipment code EP112 (Benchmark ULTRA automated slide preparation system) and EP113 (E-Bar II Barcode Slide Label System) into a single equipment item, with a price of $150,000 using equipment code EP112, Start Printed Page 46239the equipment minutes assigned to the E-Bar II Barcode Slide Label System should have been added into the new EP112 equipment time. The stakeholder requested that these minutes should be added into the EP112 equipment time; for example, 1 additional minute should be added to CPT code 88341 for a total of 16 minutes.

We appreciate the additional information, and are soliciting additional information on this topic through public comment on this proposed rule to assess whether it would be appropriate to add the former EP113 minutes into EP112. We are specifically seeking comment from other stakeholders, including the RUC, since the assigned number of minutes was originally based on a RUC recommendation. This information would be potentially relevant for CPT codes 88341 (Immunohistochemistry or immunocytochemistry, per specimen; each additional single antibody stain procedure), 88342 (Immunohistochemistry or immunocytochemistry, per specimen; initial single antibody stain procedure), 88344 (Immunohistochemistry or immunocytochemistry, per specimen; each multiplex antibody stain procedure), 88360 (Morphometric analysis, tumor immunohistochemistry, quantitative or semiquantitative, per specimen, each single antibody stain procedure; manual), and 88361 (Morphometric analysis, tumor immunohistochemistry, quantitative or semiquantitative, per specimen, each single antibody stain procedure; using computer-assisted technology).

(20) Morphometric Analysis (CPT Codes 88364, 88365, 88367, 88368, 88369 and 88373)

For CY 2015, the CPT editorial panel revised the code descriptors for the in situ hybridization procedures, CPT codes 88365, 88367 and 88368, to specify “each separately identifiable probe per block.” Additionally, three new add-on codes (CPT codes 88364, 88369, 88373,) were created to specify “each additional separately identifiable probe per slide.” Some of the add-on codes in this family had RUC-recommended work RVUs that were 60 percent of the work RVU of the base procedure. We believed this accurately reflected the resources used in furnishing these add-on codes and subsequently established interim-final work RVUs of 0.53 for code 88364 (60 percent of the work RVU of CPT code 88365); 0.53 for CPT code 88369 (60 percent of the work RVU of CPT code 88368); and 0.43 for CPT code 88373 (60 percent of the work RVU of CPT code 88367).

For CY 2016, the RUC re-reviewed these services 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 code 88365 we finalized a work RVU of 0.88.

For CPT codes 88364 and 88369, we increased the work RVUs of these add-on codes from 0.53 to 0.67, which reflected 76 percent of the work RVUs of the base procedures for these services. However, we inadvertently omitted the rationale for this revision to the work RVUs in the proposed rule. Consequently, we maintained the CY 2015 interim final values of the work RVU of 0.67 for CPT codes 88464 and 88369 and sought comment on these values for CY 2016. For CPT code 88373 we finalized a work RVU of 0.43.

Comment: A few commenters stated their objection to our use of a standard discount for pathology add-on services and for suggesting that each service is separate and unique. Commenters also stated there should be no comparison of intravascular ultrasound services to morphometric analysis, immunohistochemistry, immunofluorescence, or any pathology service.

Response: In reviewing the RUC-recommended base/add-on relationships between several pathology codes, we continue to believe the base/add-on code time relationships for pathology services are appropriate and have not been presented with any compelling evidence that conflicts with the RUC-recommended relationships. However, as we stated above, the intravascular codes we initially examined in revaluing CPT codes 88364 and 88369 were deleted in CY 2016 and replaced with CPT codes 37252 and 37253. For the reasons stated above we continue to believe this 20 percent discount relationship between the base and add-on code accurately reflects the work involved in furnishing these services.

Therefore, for CY 2017, we are proposing a work RVU of 0.70 for CPT codes 88364 and 88369 which represents a 20 percent discount from the base code. As the relationship between the base code and add-on code now represents a 20 percent difference we are proposing to revalue CPT code 88373 at 0.58 work RVUs. Therefore, for CY 2017 we are proposing a work RVU of 0.58 for CPT code 88373.

(21) Liver Elastography (CPT Code 91200)

For CY 2016, we received a RUC recommendation of 0.27 RVU for CPT code 91200. After careful review of the recommendation, we established the RUC-recommended work RVU and direct PE inputs as interim final for CY 2016.

Comment: A few commenters requested that we reconsider the level of payment assigned to this service when furnished in a non-facility setting, stating that the code met the definition for the potentially misvalued code list as there is a significant difference in payment between sites of service. The commenters also asked us to reconsider the assigned 50 percent utilization rate for the FibroScan equipment in this procedure as the current utilization rate would translate to over 50 procedures per week. Instead, the commenters suggested the typical number of procedures done per week ranges between 15 and 25 and requested we adopt a 25 percent utilization rate which corresponds to that number of procedures.

Response: We refer commenters to the CY 2016 final rule with comment period (80 FR 71057-71058) where we discussed and addressed the comparison of the PFS payment amount to the OPPS payment amount for CPT 91200. For the commenter's statement about the utilization rate, 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 percent 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 support 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. The commenters did not provide any verifiable data suggesting a lower utilization rate. Therefore, for CY 2017 we are proposing a work RVU of 0.27 for CPT code 91200, consistent with the CY 2016 interim final value, and we continue to explore and seek comments regarding publicly available data sources to identify the most accurate equipment utilization rate assumptions possible. We also note that following the Start Printed Page 46240publication of the CY 2016 PFS final rule with comment period (80 FR 70886) there was an inconsistency in the Work Time file published on the CMS Web site. For CPT code 91200 the RUC recommended 16 minutes total service time whereas our file reflected 18 minutes total time for the service. For CY 2017, we are proposing to update the Work Time file to reflect the RUC's recommendation, which is 16 minutes for CPT code 91200.

b. CY 2017 Proposed Codes

(1) Anesthesia Services Furnished in Conjunction with Lower Gastrointestinal (GI) Procedures (CPT Codes 00740 and 00810)

The anesthesia procedure CPT codes 00740 and 00810 are used for anesthesia furnished in conjunction with lower gastrointestinal (GI) procedures. In the CY 2016 PFS proposed rule (80 FR 41686), we discussed that in reviewing Medicare claims data, a separate anesthesia service is now reported more than 50 percent of the time that several types of colonoscopy procedures are reported. We discussed that 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 reexamined. We proposed to identify CPT codes 00740 and 00810 as potentially misvalued and sought public comment regarding valuation for these services.

The RUC recommended maintaining the base unit value of 5 as an interim base value for both CPT code 00740 and 00810 on an interim basis, due to their concerns about the specialty society surveys. The RUC suggested that the typical patient vignettes used in the surveys for both CPT codes 00740 and 00810 were not representative of current typical practice and recommended that the codes be resurveyed with updated vignettes. We agree that it is premature to propose any changes to the valuation of CPT codes 00740 and 00810, but continue to believe that these services are potentially misvalued and look forward to receiving input from interested parties and specialty societies for consideration during future notice and comment rulemaking.

(2) Removal of Nail Plate (CPT Code 11730)

We identified CPT code 11730 (Avulsion of nail plate, partial or complete, simple; single) through a screen of high expenditures by specialty. The HCPAC recommended a work RVU of 1.10. We believe the recommendation for this service overestimates the work involved in performing this procedure, specifically given the decrease in physician intraservice and total time concurrently recommended by the HCPAC. We believe that a work RVU of 1.05, which corresponds to the 25th percentile of the survey results, more accurately represents the time and intensity of furnishing the service. To further support the validity of the use of the 25th percentile of the survey, a work RVU of 1.05, we identified two crosswalk CPT codes, 20606 (Arthrocentesis, aspiration and/or injection, intermediate joint or bursa), with a work RVU of 1.00, and 50389 (Removal of nephrostomy tube, requiring fluoroscopic guidance) with a work RVU of 1.10, both of which have identical intraservice times, similar total times and similar intensity. We note that our proposed work RVU of 1.05 for CPT code 11730 falls halfway between the work RVUs for these two crosswalk-codes. CPT Code 11730 may be reported with add-on CPT code 11732 to report performance of the same procedure for each additional nail plate procedure.

Since CPT code 11732 was not reviewed by the HCPAC for CY 2017, we are proposing a new work value to maintain the consistency of this add-on code with the base code, CPT code 11730. We are proposing to remove 2 minutes from the physician intraservice time to maintain consistency with the HCPAC-recommended reduction of 2 minutes from the physician intraservice time period for the base code. We are using a crosswalk from the value for CPT code 77001 (Fluoroscopic guidance for central venous access device placement, replacement (catheter only or complete), or removal (includes fluoroscopic guidance for vascular access and catheter manipulation, any necessary contrast injections through access site or catheter with related venography radiologic supervision and interpretation, and radiographic documentation of final catheter position) (List separately in addition to code for primary procedure)), which has similar physician intraservice and total time values; therefore, we are proposing a work RVU of 0.38 for CPT code 11732. As further support for this proposal, we note that this proposed RVU reduction is similar to the value obtained by subtracting the incremental difference in the current and recommended work RVUs for the base code from the current value of CPT code 11732.

We are proposing to use the HCPAC-recommended direct PE inputs for CPT code 11730. We are proposing to apply some of HCPAC-recommended refinements for CPT code 11730 to11732, including the removal of the penrose drain (0.25in x 4in), lidocaine 1%-2% inj (Xylocaine), applicator (cotton-tipped, sterile) and silver sulfadiazene cream (Silvadene), as well as the reduction of the swab-pad, alcohol from 2 to 1. In addition, we are proposing not to include the recommended the supply items “needle, 30g, and syringe, 10-12ml” since other similar items are present, and we think inclusion of these additional supply items would be duplicative. For clinical labor, we are proposing to assign 8 minutes to “Assist physician in performing procedure” for to maintain a reduction that is proportionate to that recommended for 11730. For the supply item “ethyl chloride spray,” we believe that the listed input price of $4.40 per ounce overestimates the cost of this supply item, and we are seeking comment on the accuracy of this supply item price. Finally, we are adding two equipment items as was done in the base code, basic instrument pack and mayo stand, and are proposing to adjust the times for all pieces of equipment to 8 minutes to reflect the clinical service period time.

(3) Bone Biopsy Excisional (CPT Code 20245)

In CY 2014, CPT code 20245 was identified by the RUC's 10-Day Global Post-Operative Visits Screen.

For CY 2017, the RUC recommended a value of 6.50 work RVUs for CPT code 20245, including a change in global period from 10- to 0- days. We disagree with this value given the significant reductions in the intraservice time, total time, and the change in the office visits assuming the change in global period. The intraservice and total times were decreased by approximately 33 and 53 percent respectively; while the elimination of three post-operative visits (one CPT code 99214 and two CPT code 99213 visits) alone would reduce the overall work RVU by at least 38 percent under the reverse building block methodology. We also note that the RUC-recommended work RVU of 6.50 only represents a 27 percent reduction relative to the previous work RVU of 8.95. To develop a work RVU for this service, we used a crosswalk from CPT code 19298 (Placement of radiotherapy after loading brachytherapy catheters (multiple tube and button type) into the breast for interstitial radioelement application following (at the time of or subsequent to) partial mastectomy, includes imaging guidance), since we believe the codes share similar intensity and total time and the same intraservice time of 60 minutes. Therefore, for CY Start Printed Page 462412017, we are proposing a work RVU of 6.00 for CPT code 20245.

(4) Insertion of Spinal Stability Distractive Device (CPT Codes 228X1, 228X2, 228X4, and 228X5)

For CY 2016, the CPT Editorial Panel converted two Category III codes to Category I codes describing the insertion of an interlaminar/interspinous process stability device (CPT codes 228X1 and 228X4) and developed two corresponding add-on codes (CPT codes 228X2 and 228X5). The RUC recommended a work RVU of 15.00 for CPT code 228X1, 4.00 for CPT code 228X2, 7.39 for CPT code 228X4, and 2.34 for CPT code 228X5.

We believe that the RUC recommendations for CPT codes 228X1 and 228X4 overestimate the work involved in furnishing these services. We believe that a crosswalk to CPT code 36832 (Revision, open, arteriovenous fistula; without thrombectomy, autogenous or nonautogenous dialysis graft (separate procedure)) which has a work RVU of 13.50 is an accurate comparison. CPT code 36832 is similar in total time, work intensity, and number of visits to 228X1. This is supported by the ratio between total time and work in the key reference service, CPT code 63047 (Laminectomy, facetectomy and foraminotomy (unilateral or bilateral with decompression of spinal cord, cauda equina and/or nerve root[s], [e.g., spinal or lateral recess stenosis]), single vertebral segment; lumbar). Therefore, we are proposing a work RVU of 13.50 for CPT code 228X1. For CPT code 228X4, we believe that CPT code 29881 (Arthroscopy, knee, surgical; with meniscectomy (medial OR lateral, including any meniscal shaving) including debridement/shaving of articular cartilage (chondroplasty), same or separate compartment(s), when performed) is an appropriate crosswalk based on clinical similarity as well as intensity and total time. CPT code 29881 has an RVU of 7.03; therefore, we are proposing a work RVU of 7.03 for CPT code 228X4. We are proposing to accept the RUC-recommended work RVU for CPT codes 228X2 and 228X5 without refinement.

(5) Biomechanical Device Insertion (CPT Codes 22X81, 22X82, and 22X83)

For CY 2016, the CPT Editorial Panel established three new category I add-on codes and deleted one code to provide a more detailed description of the placement and attachment of biomechanical spinal devices. For CPT code 22X81, the RUC recommended a work RVU of 4.88. For CPT code 22X82, and CPT code 22X83, the recommended work RVUs are 5.50 and 6.00, respectively.

In reviewing the code descriptors, descriptions of work and vignettes associated with CPT codes 22X82 and 22X83, we determined that the two procedures, in addition to having identical work time, contain many clinical similarities and do not have quantifiable differences in overall intensity. Therefore, we are proposing the RUC-recommended work RVU of 5.50 for both CPT code 22X82 and CPT code 228X3. We believe that the RUC-recommended work RVU for CPT code 22X81 overestimates the work in the procedure relative to the other codes in the family. We are proposing a work RVU of 4.25 for CPT code 228X1 based a crosswalk from CPT code 37237 (Transcatheter placement of an intravascular stent(s) (except lower extremity artery(s) for occlusive disease, cervical carotid, extracranial vertebral or intrathoracic carotid, intracranial, or coronary), open or percutaneous, including radiological supervision and interpretation and including all angioplasty within the same vessel, when performed; each additional artery (List separately in addition to code for primary procedure)), which is similar in time and intensity to the work described by CPT code 22X81.

(6) Closed Treatment of Pelvic Ring Fracture (CPT Codes 271X1 and 271X2)

For CY 2017, the CPT Editorial Panel deleted CPT codes 27193 and 27194 and replaced them with two new codes, 271X1 and 271X2, and the RUC recommended a work RVU of 5.50 for CPT code 27193, and a work RVU of 9.00 for CPT code 271X2 to describe closed treatment of pelvic ring fracture. We are proposing to change the global period for these services from 90 days to 0 days because these codes typically represent emergent procedures with which injuries beyond pelvic ring fractures are likely to occur; we believe it is typical that multiple practitioners would be involved in providing post-operative care and it is likely that a practitioner furnishing a different procedure is more likely to be providing the primary post-operative care. If other practitioners are typically furnishing care in the post-surgery period, we believe that the six postservice visits included in CPT code 271X1, and the seven included in 271X2, would likely not occur. This is similar to our CY 2016 review and valuation of CPT codes 21811 (Open treatment of rib fracture(s) with internal fixation, includes thoracoscopic visualization when performed, unilateral; 1-3 ribs), 21812 (Open treatment of rib fracture(s) with internal fixation, includes thoracoscopic visualization when performed, unilateral; 4-6 ribs), and 21813 (Open treatment of rib fracture(s) with internal fixation, includes thoracoscopic visualization when performed, unilateral; 7 or more ribs). In our valuation of those codes, we determined that a 0-day, rather than a 90-day global period was preferable, in part because those codes describe rib fractures that would typically occur along with other injuries, and the patient would likely already be receiving post-operative care because of the other injuries. We believe that the same rationale applies here. To establish a work RVU for 271X1, we are crosswalking this code to CPT code 65800 (Paracentesis of anterior chamber of eye (separate procedure); with removal of aqueous), due to its identical intraservice time and similar total time, after removing the work associated with postoperative visits, and its similar level of intensity. Therefore, we are proposing a work RVU of 1.53 for CPT code 271X1. For 271X2, we are crosswalking to CPT code 93452 (Left heart catheterization including intraprocedural injection(s) for left ventriculography, imaging supervision and interpretation, when performed) which has an identical intraservice time and similar total time after removing the work associated with postoperative visits from 271X2. We are proposing a work RVU of 4.75 for code 271X2.

(7) Bunionectomy (CPT Codes 28289, 282X1, 28292, 28296, 282X2, 28297, 28298, and 28299)

The RUC identified CPT Code 28293 as a 90-day global service with more than 6 office visits and CPT codes 28290-28299 as part of the family of services. In October 2015, the CPT Editorial Panel created two new CPT codes (282X1, 282X2), deleted CPT codes 28290, 28293, 28294 and revised CPT codes 28289, 28292, 28296, 28297, 28298 and 28299 based on the rationale that more accurate descriptions of the services needed to be developed.

For CPT codes 28289, 28292, 28296, 28297, 28298, and 28299 the RUC recommended and we are proposing work RVUs of 6.90, 7.44, 8.25, 9.29, 7.75, and 9.29 respectively. For CPT code 282X1, the RUC recommended a work RVU of 8.01 based on the 25th percentile of the survey. We believe the recommendation for this service overestimates the overall work involved in performing this procedure given the decrease in intraservice time, total time, and post-operative visits when compared to deleted predecessor CPT code 28293. Due to similarity in Start Printed Page 46242intraservice and total times, we believe a direct crosswalk of the work RVUs for CPT code 65780 (Ocular surface reconstruction; amniotic membrane transplantation, multiple layers), to CPT code 282X1 more accurately reflects the time and intensity of furnishing the service. Therefore, for CY 2017, we are proposing a work RVU of 7.81 for CPT code 282X1.

For CPT code 282X2, the RUC recommended a work RVU of 8.57 based on the 25th percentile of the survey. We believe the recommendation for this service overestimates the work involved in performing this procedure given the similarity in the intensity of the services and identical intraservice and total times as CPT code 28296. Therefore, we propose a direct RVU crosswalk from CPT code 28296 to CPT code 282X2. For CY 2017, we are proposing a work RVU of 8.25 for CPT code 282X2.

(8) Endotracheal Intubation (CPT Code 31500)

In the CY 2016 PFS final rule with comment period (80 FR 70914), we identified CPT code 31500 as potentially misvalued. The specialty societies surveyed this code, and after reviewing the survey responses, including increases in time, the RUC recommended an increase in work RVUs to 3.00 for CPT code 31500. After reviewing the RUC's recommendation, we are proposing a work RVU of 2.66, based on a direct crosswalk to CPT code 65855, which has similar intensity and service times as reflected in the survey data reported by the specialty groups.

(9) Closure of Left Atrial Appendage With Endocardial Implant (CPT Code 333X3)

The CPT Editorial Panel deleted category III code 0281T (Percutaneous transcatheter closure of the left atrial appendage with implant, including fluoroscopy, transseptal puncture, catheter placement(s), left atrial angiography, left atrial appendage angiography, radiological supervision and interpretation) and created new CPT code 333X3 to describe percutaneous transcatheter closure of the left atrial appendage with implant. The RUC recommended a work RVU of 14.00, which is the 25th percentile survey result. After reviewing that recommendation, we are proposing a work RVU of 13.00 for CPT code 333X3, which is the minimum survey result. Based on our clinical judgment and that the key reference codes discussed in the RUC recommendations have higher intraservice and total service times than the median survey results for CPT code 333X3, we believe a work RVU of 13.00 more accurately represents the work value for this service.

(10) Valvuloplasty (CPT Codes 334X1 and 334X2)

The CPT Editorial Committee created new codes to describe valvuloplasty procedures and deleted existing CPT code 33400 (Valvuloplasty, aortic valve; open, with cardiopulmonary bypass). New CPT code 334X1 represents a simple valvuloplasty procedure and new CPT code 334X2 describes a more complex valvuloplasty procedure. We are proposing to use the RUC-recommended values for CPT code 334X1. For CPT code 334X2, the RUC recommended a work RVU of 44.00, the 25th percentile survey result. The RUC estimated that approximately 70 percent of the services previously reported using CPT code 33400 would have been reported using CPT code 334X2 with 30 percent reported using new CPT code 334X1. Therefore, the typical service previously reported with 33400 ought to now be reported with 334X2. Compared to deleted CPT code 33400, the survey results for CPT 334X2 showed the median intraservice time to be similar but total service time to be decreased. Therefore, we do not believe the increase recommended by the RUC is warranted, and we are proposing a work RVU of 41.50 for CPT code 334X2. This is the current value of CPT code 33400, and given that the typical service should remain consistent between the two codes, we believe the work RVU should remain consistent as well.

(11) Dialysis Circuit (CPT Codes 369X1, 369X2, 369X3, 369X4, 369X5, 369X6, 369X7, 369X8, 369X9)

In January 2015, a CPT/RUC workgroup identified the following CPT codes as being frequently reported together in various combinations: 35475 (Transluminal balloon angioplasty, percutaneous; brachiocephalic trunk or branches, each vessel), 35476 (Transluminal balloon angioplasty, percutaneous; venous), 36147 (Introduction of needle and/or catheter, arteriovenous shunt created for dialysis (graft/fistula); initial access with complete radiological evaluation of dialysis access, including fluoroscopy, image documentation and report), 36148 (Introduction of needle and/or catheter, arteriovenous shunt created for dialysis (graft/fistula); additional access for therapeutic intervention), 37236 (Transcatheter placement of an intravascular stent(s) (except lower extremity artery(s) for occlusive disease, cervical carotid, extracranial vertebral or intrathoracic carotid, intracranial, or coronary), open or percutaneous, including radiological supervision and interpretation and including all angioplasty within the same vessel, when performed; initial artery), 37238 (Transcatheter placement of an intravascular stent(s), open or percutaneous, including radiological supervision and interpretation and including angioplasty within the same vessel, when performed; initial vein), 75791 (Angiography, arteriovenous shunt (e.g., dialysis patient fistula/graft), complete evaluation of dialysis access, including fluoroscopy, image documentation and report (includes injections of contrast and all necessary imaging from the arterial anastomosis and adjacent artery through entire venous outflow including the inferior or superior vena cava), radiological supervision and interpretation), 75962 (Transluminal balloon angioplasty, peripheral artery other than renal, or other visceral artery, iliac or lower extremity, radiological supervision and interpretation), and 75968 (Transluminal balloon angioplasty, each additional visceral artery, radiological supervision and interpretation). These codes are frequently reported together for both dialysis circuit services and transluminal angioplasty services. At the October 2015 CPT Editorial Panel meeting, the panel approved the creation of nine new codes and deletion of four existing codes used to describe bundled dialysis circuit intervention services, and the creation of four new codes and deletion of 13 existing codes used to describe bundled percutaneous transluminal angioplasty services (see discussion of the latter code family in the next section). The Dialysis Circuit family of codes overlaps with the Open and Percutaneous Transluminal Angioplasty family of codes (CPT codes 372X1-372X4), as they are both being constructed from the same set of frequently reported together codes. We reviewed these two families of codes concurrently to maintain relativity between these clinically similar procedures based upon the same collection of deleted codes.

For CPT code 369X1, we are proposing a work RVU of 2.82 instead of the RUC-recommended work RVU of 3.36. When we compared CPT code 369X1 against other codes in the RUC database, we found that the RUC-recommended work RVU of 3.36 would be the highest value in the database among the 32 0-day global codes with 25 minutes of intraservice time. Generally speaking, we are particularly skeptical of RUC-recommended values for newly “bundled” codes that appear not to recognize the full resource Start Printed Page 46243overlap between predecessor codes. Since the recommended values would establish a new highest value when compared to other services with similar time, we believe it likely that the recommended value for the new code does not reflect the efficiencies in time. Of course, were the compelling evidence for this valuation accompanying the recommendation, we would consider such information. We also note that the reference code selected by the survey participants, CPT code 36200 (Introduction of catheter, aorta), has a higher intraservice time and total time, but a lower work RVU of 3.02. We believe that there are more accurate CPT codes that can serve as a reference for CPT code 369X1. As a result, we are proposing to crosswalk CPT code 369X1 to CPT code 44388 (Colonoscopy through stoma; diagnostic). CPT code 44388 has a work RVU of 2.82, and we believe it is a more accurate crosswalk for valuation due to its similar overall intensity and shared intraservice time of 25 minutes with 369X1 and similar total time of 65 minutes.

We are proposing a work RVU of 4.24 for CPT code 369X2 instead of the RUC-recommended work RVU of 4.83. The RUC-recommended work RVU is based upon a direct crosswalk to CPT code 43253 (Esophagogastroduodenoscopy, flexible, transoral) which shares the same 40 minutes of intraservice time with CPT code 369X2. However, CPT code 43253 has significantly longer total time than CPT code 369X2, 104 minutes against 86 minutes, which we believe reduces its utility for comparison. We are instead proposing to crosswalk the work RVU for CPT code 369X2 from CPT code 44408 (Colonoscopy through stoma), which has a work RVU of 4.24. In addition to our assessment that the two codes share similar intensities, CPT code 44408 also shares 40 minutes of intraservice time with CPT code 369X2 but has only 95 minutes of total time and matches the duration of the procedure under review more closely than the RUC-recommended crosswalk to CPT code 43253. We also note that the RUC-recommended work increment between CPT codes 369X1 and 369X2 was 1.47, and by proposing a work RVU of 4.24 for CPT code 369X2, we maintain a very similar increment of 1.42. As a result, we are proposing a work RVU of 4.24 for CPT code 369X2, based on this direct crosswalk to CPT code 44408.

For CPT code 369X3, we are proposing a work RVU of 5.85 instead of the RUC-recommended work RVU of 6.39. The RUC-recommended value is based on a direct crosswalk to CPT code 52282 (Cystourethroscopy, with insertion of permanent urethral stent). Like the previous pair of RUC-recommended crosswalk codes, CPT code 52282 shares the same intraservice time of 50 minutes with CPT code 369X3, but has substantially longer total time (120 minutes against 96 minutes) which we believe limits its utility as a crosswalk. We are proposing a work RVU of 5.85 based on maintaining the RUC-recommended work RVU increment of 3.03 as compared to CPT code 369X1 (proposed at a work RVU of 2.82), the base code for this family of related procedures. We also point to CPT code 44403 (Colonoscopy through stoma; with endoscopic mucosal resection) as a reference point for this value. CPT code 44403 has a work RVU of 5.60, but also lower intraservice time (45 minutes as compared to 50 minutes) and total time (92 minutes as compared to 96 minutes) in relation to CPT code 369X3, suggesting that a work RVU a bit higher than 5.60 would be an accurate valuation. Therefore, we are proposing a work RVU of 5.85 for CPT code 369X3, based on an increment of 3.03 from the work RVU of CPT code 369X1.

We are proposing a work RVU of 6.73 instead of the RUC-recommended work RVU of 7.50 for CPT code 369X4. Our proposed value comes from a direct crosswalk from CPT code 43264 (Endoscopic retrograde cholangiopancreatography), which shares the same intraservice time of 60 minutes with CPT code 369X4 and has a higher total time. We also looked to the intraservice time ratio between CPT codes 369X1 and 369X4; this works out to 60 minutes divided by 25 minutes, for a ratio of 2.4, and a suggested work RVU of 6.77 (derived from 2.4 times CPT code 369X1's work RVU of 2.82). This indicates that our proposed work RVU of 6.73 maintains relativity within the Dialysis Circuit family. As a result, we are proposing a work RVU of 6.73 for CPT code 369X4, based on a direct crosswalk to CPT code 43264.

We are proposing a work RVU of 8.46 instead of the RUC-recommended work RVU of 9.00 for CPT code 369X5. We looked at the intraservice time ratio between CPT codes 369X1 and 369X5 as one potential method for valuation, which is a 1:3 ratio (25 minutes against 75 minutes) for this case. This means that one potential value for CPT code 369X5 would be triple the work RVU of CPT code 369X1, or 2.82 times 3, which results in a work RVU of 8.46. We also investigated preserving the RUC-recommended work RVU increment between CPT code 369X1 and 369X5, which was an increase of 5.64. When this increment is added to the work RVU of 2.82 for CPT code 369X1, it also resulted in a work RVU of 8.46 for CPT code 369X5. Therefore, we are proposing a work RVU of 8.46 for CPT code 369X5, based on both the intraservice time ratio with CPT code 369X1 and the RUC-recommended work increment with the same code.

For CPT code 369X6, we are proposing a work RVU of 9.88 instead of the RUC-recommended work RVU of 10.42. We based the proposed value upon the RUC-recommended work RVU increment between CPT codes 369X1 and 369X6, which is 7.06. When added to the work RVU of 2.82 for CPT code 369X1, the work RVU for CPT code 369X6 would be 9.88. We are supporting this value through the use of two crosswalks that both share the same 90 minutes of intraservice time with 369X6. These are CPT code 31546 (Laryngoscopy, direct, with submucosal removal of non-neoplastic lesion(s) of vocal cord) at a work RVU of 9.73 and CPT code 61623 (Endovascular temporary balloon arterial occlusion, head or neck) at a work RVU of 9.95.

The final three codes in the Dialysis Circuit family are all add-on codes, which make comparisons difficult to the global 0-day codes that make up the rest of the family. We are proposing a work RVU of 2.48 instead of the RUC-recommended work RVU of 3.00 for CPT code 369X7. Due to the difficulty of comparing CPT code 369X7 with the non-add-on codes in the rest of the Dialysis Circuit family, we looked instead to compare the value to the add-on codes in the Open and Percutaneous Transluminal Angioplasty family of codes (CPT codes 372X1-372X4). As we stated previously, both of these groups of new codes are being constructed from the same set of frequently reported together codes. We reviewed these two families of codes together to maintain relativity across the two families, and so that we could compare codes that shared the same global period.

We are proposing the RUC-recommended work RVUs for all four codes in the Open and Percutaneous Transluminal Angioplasty family of codes. As a result, we compared CPT code 369X7 with the RUC-recommended work RVU of 2.97 for CPT code 372X4, which is also an add-on code. These procedures should be clinically very similar, since both of them are performing percutaneous transluminal angioplasty on a central vein, and both of them are add-on procedures. We looked at the intraservice time ratio between these two codes, which was a comparison between 25 minutes for CPT code 369X7 against 30 minutes for CPT code 372X4. Start Printed Page 46244This produces a ratio of 0.83, and a proposed work RVU of 2.48 for CPT code 369X7 when multiplied with the RUC-recommended work RVU of 2.97 for CPT code 372X4. We note as well that the intensity was markedly higher for CPT code 369X7 as compared to CPT code 372X4 when using the RUC-recommended work values, which did not make sense since CPT code 369X7 would typically be a clinically less intense procedure. Using the intraservice time ratio results in the two codes having exactly the same intensity. As a result, we are therefore proposing a work RVU of 2.48 for CPT code 369X7, based on this intraservice time ratio with the RUC-recommended work RVU of CPT code 372X4.

For CPT code 369X8, we disagree with the RUC-recommended work RVU of 4.25, and we are instead proposing a work RVU of 3.73. We do not consider the RUC work value of 4.25 to be accurate for CPT code 369X8, as this was higher than our proposed work value for CPT code 369X2 (4.24), and we do not believe that an add-on code should typically have a higher work value than a similar non-add-on code with the same intraservice time. We identified two appropriate crosswalks for valuing CPT code 369X8: CPT code 93462 (Left heart catheterization by transseptal puncture through intact septum or by transapical puncture) and CPT code 37222 (Revascularization, endovascular, open or percutaneous, iliac artery). Both of these codes share the same intraservice time as CPT code 369X8, and both of them also have the same work RVU of 3.73, which results in these codes also sharing the same intensity since they are all add-on codes. We are therefore proposing a work value of 3.73 for CPT code 369X8, based on a direct crosswalk to CPT codes 93462 and 37222.

Finally, we are proposing a work RVU of 3.48 for CPT code 369X9 instead of the RUC-recommended work RVU of 4.12. The RUC recommended value comes from a direct crosswalk from CPT code 38746 (Thoracic lymphadenectomy by thoracotomy). We compared the RUC-recommended work RVU for this procedure to other add-on codes with 30 minutes of intraservice time and found that the recommended work RVU of 4.12 would overestimate the overall intensity of this service relative to those with similar times. In reviewing the range of these codes, we believe that a more appropriate crosswalk is to CPT code 61797 (Stereotactic radiosurgery (particle beam, gamma ray, or linear accelerator)) at a work RVU of 3.48. We believe that this value is more accurate when compared to other add-on procedures with 30 minutes of intraservice time across the PFS. As a result, we are proposing a work RVU of 3.48 for CPT code 369X9 based on a direct crosswalk from CPT code 61797.

We are proposing to use the RUC-recommended direct PE inputs for these nine codes with several refinements. We are not proposing to include the recommended additional preservice clinical labor for CPT codes 369X4, 369X5, and 369X6. The preservice work description is identical for all six of the global 0-day codes in this family; there is no justification given in the RUC recommendations as to why the second three codes need additional clinical labor time beyond the minimal preservice clinical labor assigned to the first three codes. We do not believe that the additional staff time would be typical. Patient care already would have been coordinated ahead of time in the typical case, and the need for unscheduled dialysis or other unusual circumstances would be discussed prior to the day of the procedure. We are therefore proposing to refine the preservice clinical labor for CPT codes 369X4, 369X5, and 369X6 to match the preservice clinical labor of CPT codes 369X1, 369X2, and 369X3.

We are proposing to refine the L037D clinical labor for “Prepare and position patient/monitor patient/set up IV” from 5 minutes to 3 minutes for CPT codes 369X1-369X6. The RUC recommendation included a written justification for additional clinical labor time beyond the standard 2 minutes for this activity, stating that the extra time is needed to prepare the patient's arm for the procedure. We agree that extra time may be needed for this activity as compared to the default standard of 2 minutes; however, we are assigning 1 extra minute for preparing the patient's arm, resulting in a total of 3 minutes for this task. We do not believe that 3 extra minutes would be typically needed for arm positioning.

We are proposing to remove the “kit, for percutaneous thrombolytic device (Trerotola)” supply (SA015) from CPT codes 369X4, 369X5, and 369X6. We believe that this thrombolytic device kit and the “catheter, thrombectomy-Fogarty” (SD032) provide essentially the same supply, and the use of only one of them would be typical in these procedures. We believe that each of these supplies can be used individually for thrombectomy procedures. We are proposing to remove the SA015 supply and retain the SD032 supply, and we seek additional comment and information regarding the use of these two supplies.

We are also proposing to remove the recommended supply item “covered stent (VIABAHN, Gore)” (SD254) and replace it with the “stent, vascular, deployment system, Cordis SMART” (SA103) for CPT codes 369X3 and 369X6. The Cordis SMART vascular stent was previously used in the past for CPT code 37238, which is the deleted code for transcatheter placement of an intravascular stent that CPT codes 369X3 and 369X6 are replacing. We do not have a stated rationale as to the need for this supply substitution, and therefore, we do not believe it would be appropriate to replace the current items with a significantly higher-priced item without additional information.

We are also proposing to refine the quantity of the “Hemostatic patch” (SG095) from 2 to 1 for CPT codes 369X4, 369X5, and 369X6. This supply was not included in any of the deleted base codes out of which the new codes are being constructed, and while we agree that the use of a single hemostatic patch has become common clinical practice, we do not agree that CPT codes 369X4-369X6 would typically require a second patch. As a result, we are proposing to refine the SG095 supply quantity from 2 to 1 for CPT codes 369X4-369X6, which also matches the supply quantity for CPT codes 369X1-369X3.

Included in the RUC recommendation for the Dialysis Circuit family of codes were a series of invoices for a “ChloraPrep applicator (26 ml)” supply. We are soliciting comments regarding whether the Betadine solution has been replaced by a Chloraprep solution in the typical case for these procedures. We are also soliciting comments regarding whether the “ChloraPrep applicator (26 ml)” detailed on the submitted invoices is the same supply as the SH098 “chlorhexidine 4.0% (Hibiclens)” applicator currently in the direct PE database.

Finally, we are also interested in soliciting comments about the use of guidewires for these procedures. We are requesting feedback about which guidewires would be typically used for these procedures, and which guidewires are no longer clinically necessary.

(12) Open and Percutaneous Transluminal Angioplasty (CPT Codes 372X1, 372X2, 372X3, and 372X4)

In January 2015, a CPT/RUC workgroup identified the following CPT codes as being frequently reported together in various combinations: 35475 (Transluminal balloon angioplasty, percutaneous; brachiocephalic trunk or branches, each vessel), 35476 (Transluminal balloon angioplasty, Start Printed Page 46245percutaneous; venous), 36147 (Introduction of needle and/or catheter, arteriovenous shunt created for dialysis (graft/fistula); initial access with complete radiological evaluation of dialysis access, including fluoroscopy, image documentation and report), 36148 (Introduction of needle and/or catheter, arteriovenous shunt created for dialysis (graft/fistula); additional access for therapeutic intervention), 37236 (Transcatheter placement of an intravascular stent(s) (except lower extremity artery(s) for occlusive disease, cervical carotid, extracranial vertebral or intrathoracic carotid, intracranial, or coronary), open or percutaneous, including radiological supervision and interpretation and including all angioplasty within the same vessel, when performed; initial artery), 37238 (Transcatheter placement of an intravascular stent(s), open or percutaneous, including radiological supervision and interpretation and including angioplasty within the same vessel, when performed; initial vein), 75791 (Angiography, arteriovenous shunt (e.g., dialysis patient fistula/graft), complete evaluation of dialysis access, including fluoroscopy, image documentation and report (includes injections of contrast and all necessary imaging from the arterial anastomosis and adjacent artery through entire venous outflow including the inferior or superior vena cava), radiological supervision and interpretation), 75962 (Transluminal balloon angioplasty, peripheral artery other than renal, or other visceral artery, iliac or lower extremity, radiological supervision and interpretation), and 75968 (Transluminal balloon angioplasty, each additional visceral artery, radiological supervision and interpretation). At the October 2015 CPT Editorial Panel meeting, the panel approved the creation of four new codes and deletion of 13 existing codes used to describe bundled percutaneous transluminal angioplasty services. The Open and Percutaneous Transluminal Angioplasty family of codes overlaps with the Dialysis Circuit family of codes (CPT codes 369X1-369X9), as they are both being constructed from the same set of frequently reported together codes. We reviewed these two families of codes concurrently to maintain relativity between these clinically similar procedures based upon the same collection of deleted codes. After consideration of these materials, we are proposing to accept the RUC-recommended work RVU for CPT codes 372X1, 372X2, 372X3, and 372X4.

For the clinical labor direct PE inputs, we are proposing to use the RUC-recommend inputs with several refinements. Our proposed inputs refine the recommended clinical labor time for “Prepare and position patient/monitor patient/set up IV” from 5 minutes to 3 minutes for CPT codes 372X1 and 372X3. The RUC recommendation included a written justification for additional clinical labor time beyond the standard 2 minutes for this activity, stating that the extra time was needed to move leads out of X-ray field, check that X-ray is not obstructed and that there is no risk of collision of X-ray equipment with patient. As we wrote for the same clinical labor activity in the Dialysis Circuit family, we agree that extra time may be needed for this activity as compared to the default standard of 2 minutes; however, we are assigning 1 extra minute for the additional positioning tasks, resulting in a total of 3 minutes for this task. We do not believe that 3 extra minutes would be typically needed for preparation of the X-ray. The equipment times for the angiography room (EL011) and the PACS workstation (ED050) have been refined to reflect this change in clinical labor.

We are proposing to remove the “drape, sterile, femoral” supply (SB009) and replace it with a “drape, sterile, fenestrated 16in x 29in” supply (SB011) for CPT codes 372X1 and 372X3. The two base codes out of which these new codes are being constructed, CPT codes 35471 and 35476, both made use of the SB011 fenestrated sterile drape supply, and there was no rationale provided for the switch to the SB009 femoral sterile drape in the two new codes. We are seeking comment on the use of sterile drapes for these procedures, and what rationale there is to support the use of the SB009 femoral sterile drape as typical for these new procedures.

(13) Percutaneous Biliary Procedures Bundling (CPT Codes 47531, 47532, 47533, 47534, 47535, 47536, 47537, 47538, 47539, 47540, 47541, 47542, 47543, and 47544)

This group of fourteen codes was reviewed by the RUC at the April 2015 meeting. We established interim final values for this group of codes during the CY 2016 PFS rulemaking cycle, and subsequently received updated RUC recommendations from the October 2015 meeting for the CY 2017 PFS rulemaking cycle. Our proposals for these codes incorporate both the updated RUC recommendations, as well as public comments received as part of the interim final status of these procedures.

We received several comments regarding the CMS refinements to the work values for this family of codes in the CY 2016 final rule with comment period. The relevance of many of these comments has been diminished by the new series of RUC recommendations for work values that we received as a result of the October 2015 meeting. Given that we are proposing the updated RUC-recommended work RVUs for CPT codes 47531, 47532, 47533, 47534, 47535, 47536, 47537, 47538, 47539, 47540, 47542, 47543, and 47544, we seek additional comments relative to these proposed values. We agree that the second round of physician surveys conducted for the October 2015 RUC meeting more accurately captured the work and time required to perform these procedures. The one exception is CPT code 47541; the survey times for this procedure were identical as conducted for the April and October 2015 RUC meetings, yet the RUC recommendation increased from a work RVU of 5.61 in April to a work RVU of 7.00 in October. Given that the time values for the procedure remained unchanged between the two surveys, we do not understand why the work RVU would have increased by nearly 1.50 in the intervening months. Since this code also has an identical intraservice time (60 minutes) and total time (121 minutes) as CPT code 47533, we do not agree that it should be valued at a substantially higher rate compared to a medically similar procedure within the same code family. We are therefore proposing to crosswalk the work value of CPT code 47541 to the work value of CPT code 47533, and we are proposing a work RVU of 5.63 for both procedures.

We also note that many of the codes in the Percutaneous Biliary Procedures family were previously included in Appendix G, and were valued under the assumption that moderate sedation was typically performed on the patient. As part of the initiative to pay separately for moderate sedation when it is performed, we are removing a portion of the work RVU and preservice work time from CPT codes 47532, 47533, 47534, 47535, 47536, 47538, 47539, 47540, and 47541. For example, we are proposing that CPT code 47541 undergoes a 0.25 reduction in its work RVU from 5.63 to 5.38, and a 10 minute reduction in its preservice work time from 33 minutes to 23 minutes, to reflect the work that will now be reported separately using the new moderate sedation codes. CPT codes 47542, 47533, and 47544 are also included in the moderate sedation initiative; however, as add-on codes, they are not subject to alterations in Start Printed Page 46246their work RVUs or work times since the moderate sedation code with work RVUs and work time (991X2) will only be billed once for each base-code and not additionally with the add-on codes. These changes are reflected in Appendix B and the work time file posted to the Web; see section II.D for more details.

For the direct PE inputs, we are proposing to remove the L051A clinical labor for “Sedate/apply anesthesia” and the L037D for “Assist Physician in Performing Procedure” for CPT codes 47531 and 47537. As we wrote in last year's final rule with comment period (80 FR 71053), we believe that this clinical labor describes activities associated with moderate sedation, and moderate sedation is not typical for these procedures. We are also proposing to refine the L037D clinical labor for “Clean room/equipment by physician staff” from 6 minutes to 3 minutes for all of the codes in this family. Three minutes is the standard for this clinical labor activity, and we continue to maintain that the need for additional clinical labor time for this cleaning activity would not be typical for these procedures.

Comment: One commenter disagreed with our refinement to replace supply item “catheter, balloon, PTA” (SD152) with supply item “catheter, balloon ureteral (Dowd)” (SD150). The commenter stated that a Dowd catheter is designed and FDA approved for use in the prostatic urethra by retrograde placement through the penile urethra, and it is not designed for use in an antegrade ureteral dilation procedure. The commenter stated that this replacement is inappropriate. The updated RUC recommendations for this family of codes also restored the balloon PTA catheter.

Response: We are proposing again to replace the recommended supply item “catheter, balloon, PTA” (SD152) with supply item “catheter, balloon ureteral (Dowd)” (SD150). We believe that the use of this ureteral balloon catheter, which is specifically designed for catheter and image guidance procedures, would be more typical than the use of a PTA balloon catheter. While we recognize that the Dowd catheter is not FDA approved, it is our understanding that the PTA balloon catheter has also not been FDA approved for use in these procedures. We are uncertain if the commenter was requesting that we should no longer include catheters that lack FDA approval in the direct PE database; this would preclude the use of most of the catheters in our direct PE database. We welcome additional comment on the use of FDA approved catheters; in the meantime, we will continue our long-standing practice of using the catheters in the direct PE database without explicit regard to FDA approval in particular procedures.

We are also proposing to remove the recommended supply item “stone basket” (SD315) from CPT code 47543 and add it to CPT code 47544. Based on the code descriptors, we believe that the stone basket was intended to be included in CPT code 47544 and was erroneously listed under CPT code 47543. We are soliciting comments from the public to help clarify this issue.

We note again that many of the codes in the Percutaneous Biliary Procedures family were previously included in Appendix G, and as part of the initiative to pay separately for moderate sedation when performed, we are removing some of the recommended direct PE inputs related to moderate sedation from CPT codes 47532, 47533, 47534, 47535, 47536, 47538, 47539, 47540, and 47541. We are removing the L051A clinical labor time for “Sedate/apply anesthesia”, “Assist Physician in Performing Procedure (CS)”, and “Monitor pt. following moderate sedation”. We are also removing the conscious sedation pack (SA044) supply, and some or all of the equipment time for the stretcher (EF018), the mobile instrument table (EF027), the 3-channel ECG (EQ011), and the IV infusion pump (EQ032). These changes are reflected in the public use files posted to the web; see section II.D for more details.

(14) Flexible Laryngoscopy (CPT Codes 31575, 31576, 31577, 31578, 317X1, 317X2, 317X3, and 31579)

After we identified CPT codes 31575 and 31579 as potentially misvalued in (80 FR 70912-70914) the RUC referred the entire flexible laryngoscopy family of codes back to CPT for revision and the addition of several codes representing new technology within this family of services. At the May 2015 CPT meeting, the Editorial Panel added three new codes to describe laryngoscopy with ablation or destruction of lesion and therapeutic injection. Based on the survey results, the time resources involved in furnishing the procedures described by this code family experienced a significant reduction in the intraservice period, yet the recommended work RVUs were not similarly reduced. Therefore, in reviewing the recommended values for this family of codes we looked for a rationale for increased intensity and absent such rationale, propose to adjust the recommend work RVUs to account for significant changes in time.

For CPT code 31575, we disagree with the RUC-recommended work RVU of 1.00, and we are instead proposing a work RVU of 0.94. We looked at the total time ratio for CPT code 31575, which is decreasing from 28 minutes to 24 minutes, and applied this ratio of 0.86 times the current work RVU of 1.10 to derive our proposed work RVU of 0.94. We are supporting this value for CPT code 31575 through a crosswalk to CPT code 64405 (Injection, anesthetic agent; greater occipital nerve), which shares 5 minutes of intraservice time and also has a work RVU of 0.94.

We agree with the RUC that CPT code 31575 serves as the base code for the rest of the Flexible Laryngoscopy family. As a result, we are proposing to maintain the same RUC-recommended increments for the rest of the codes in this family, measuring the increments from CPT code 31575's refined work RVU of 0.94 instead of the RUC-recommended work RVU of 1.00. This means that each of the work RVUs for the codes in the rest of the family has decreased by 0.06 when compared to the RUC-recommended value. We are therefore proposing a work RVU of 1.89 for CPT code 31576, a work RVU of 2.19 for CPT code 31577, a work RVU of 2.43 for CPT code 31578, a work RVU of 3.01 for CPT code 317X1, a work RVU of 2.43 for CPT code 317X2, a work RVU of 2.43 for CPT code 317X3, and a work RVU of 1.88 for CPT code 31579.

Amongst the direct PE inputs, we are proposing to refine the clinical labor time for “Obtain vital signs” for CPT codes 31577 and 31579 from 3 minutes to 2 minutes. We believe that this extra clinical labor time is duplicative, as these codes are typically performed with a same day E/M service. Each procedure is only allotted a maximum of 5 minutes for obtaining vital signs, and since 3 minutes are already included in the E/M code, we are proposing to reduce the time to 2 minutes for these services. Similarly, we are proposing to remove the 3 minutes of clinical labor time for “Clean room/equipment by physician staff” from CPT codes 31575, 31577, and 31579. These procedures are typically reported with a same day E/M service, making the clinical labor minutes for cleaning the room in these procedure codes duplicative of the time already included in the E/M codes.

For CPT code 317X1, we are proposing to remove the “laser tip, diffuser fiber” supply (SF030) and replace it with the “laser tip, bare (single use)” supply (SF029) already present in our direct PE database. We Start Printed Page 46247believe that the invoice for SF030 submitted with the RUC recommendation is not current enough to establish a new price for this supply; as a result, we are substituting the SF029 supply for this input. We welcome the submission of new invoices to accurately price the diffuser fiber with laser tip.

We are also proposing to make significant changes to the prices of several of the supplies and equipment related to Flexible Laryngoscopy, as well as to the prices of scopes more broadly. We are proposing to set the price of the disposable biopsy forceps supply (SD318) at $26.84, based on the submission of an invoice with a price of $536.81 for a unit size of 20. In our search for additional information regarding scope inputs, we obtained a quote from a vendor listing the current price for several equipment items related to the use of scopes. Since we believe that the prices in vendor quotes would typically be equal to or higher than prices actually paid by practitioners, we are updating the prices in our direct PE database to reflect this new information. As part of this process, we are proposing to increase the price of the “light source, xenon” (EQ167) from $6,723.33 to $7,000 to reflect current pricing information. We are also proposing to adjust the price of the “fiberscope, flexible, rhinolaryngoscopy” (ES020) from $6,301.93 to $4,250.00.

In accordance with the wider proposal that we are making involving the use of scope equipment, we are proposing to separate the scopes used in these procedures from the scope video systems. In the course of researching different kinds of scopes, we obtained vendor pricing for two different types of scopes used in these procedures. We are proposing to price the “rhinolaryngoscope, flexible, video, non-channeled” (ES063) at $8,000 and the “rhinolaryngoscope, flexible, video, channeled” (ES064) at $9,000 in accordance with our vendor quotes. We are proposing to use the non-channeled scope for CPT codes 31575, 31579, and 317X3 and the channeled scope for CPT codes 31576, 31577, 31578, 317X1, and 317X2 in accordance with the RUC-recommended video systems that stipulated channeled versus non-channeled scope procedures.

We believe that the “Video-flexible laryngoscope system” listed in the recommendations is not a new form of equipment, but rather constitutes a version of the existing “video system, endoscopy” equipment (ES031). We are not adding a new equipment item to our direct PE database; instead, we are proposing to use the submitted invoices to update the price of the ES031 endoscopy video system. As the equipment code for ES031 indicates, we are proposing to define the endoscopy video system as containing a processor, digital capture, monitor, printer, and cart. We are proposing to price ES031 at $15,045.00; this reflects a price of $2,000.00 for the monitor, $9,000.00 for the processor, $1,750.00 for the cart, and $2,295.00 for the printer. These prices were obtained from our vendor invoice, with the exception of the printer, which is a crosswalk to the “video printer, color (Sony medical grade)” equipment (ED036).

We do not agree that there is a need for multiple different video systems for this collection of Flexible Laryngoscopy codes based on our understanding of the clinical differences among the codes. In keeping with this understanding, we are proposing to use the same existing “video system, endoscopy” equipment (ES031) for the remaining codes in the family that included RUC recommendations for new equipment items named “Video-flexible channeled laryngoscope system” and “Video-flexible laryngoscope stroboscopy system.” For CPT codes 31576, 31577, 31578, 317X1, and 317X2, we are proposing to replace the Video-flexible channeled laryngoscope system with the existing endoscopy video system (ES031) along with a channeled flexible video rhinolaryngoscope (ES064). For CPT code 31579, we are proposing to rename the RUC-recommended “Video-flexible laryngoscope stroboscopy system” to the shortened “stroboscopy system” (ES065) and assign it a price of $19,100.00. This reflects the price of the StrobeLED Stroboscopy system included on the submitted invoice. We are proposing to treat the stroboscopy system as a scope accessory, which will be included along with the “video system, endoscopy” equipment (ES031) and the “rhinolaryngoscope, flexible, video, non-channeled” (ES063) for CPT code 31579. When the price of the scope, the scope video system, and the stroboscopy system are summed together, the total proposed equipment price is $42,145.00.

We are proposing to refine the recommended equipment times for several equipment items to conform to changes in clinical labor time. These are: The fiberoptic headlight (EQ170), the suction and pressure cabinet (EQ234), the reclining exam chair with headrest (EF008), and the basic instrument pack (EQ137). We are proposing to use the standard equipment time formula for scope accessories for the endoscopy video system (ES031) and the stroboscopy scope accessory system (ES065). We are also proposing to refine the equipment time for the channeled and non-channeled flexible video rhinolaryngoscopes to use the standard equipment time formula for scopes. For this latter pair of two new equipment items, this proposal results in small increases to their respective equipment times.

(15) Laryngoplasty (CPT Codes 31580, 31584, 31587, and 315X1-315X6)

CPT code 31588 (Laryngoplasty, not otherwise specified (e.g., for burns, reconstruction after partial laryngectomy) was identified as potentially misvalued based on the RUC's 90-Day Global Post-Operative Visits screen. When this code family was reviewed by the RUC, it was determined that some codes in the family required revision to reflect the typical patient before a survey could be conducted and the code family was referred to the CPT Editorial Panel for revision. At the October 2015 CPT Editorial Panel meeting, the CPT Editorial Panel approved the creation of six new codes, revision of three codes, and deletion of three codes. For CPT codes 31580, 31587, 315X1, 315X2, 315X3, 315X4, and 315X6, CMS is proposing the RUC-recommended work RVUs.

For CPT code 31584, the RUC recommended a work RVU of 20.00. We believe that the 25th percentile of the survey, which is a work RVU of 17.58, better represents the time and intensity involved with furnishing this service based on a comparison with and assessment of the overall intensity of other codes with similar instraservice and total time. This value is also supported by a crosswalk code of CPT code 42844 (Radical resection of tonsil, tonsillar pillars, and/or retromolar trigone; closure with local flap (e.g., tongue, buccal)), which has identical intraservice time and identical total time. Therefore, we are proposing a work value of 17.58 RVUs for CPT code 31584.

For CPT code 315X5, the RUC recommended a work value of 15.60 RVUs. We believe that the 25th percentile of the survey, which is a work RVU of 13.56, better represents the time and intensity involved with furnishing this service based on a comparison of the overall intensity of other codes with similar instraservice and total time. The 25th percentile of the survey is additionally bracketed by two crosswalk codes that we estimate have slightly lower and slighter higher overall intensities, CPT code 36819 Start Printed Page 46248(Arteriovenous anastomosis, open; by upper arm basilic vein transposition), which has a work RVU of 13.29, and CPT code 49654 (Laparoscopy, surgical, repair, incisional hernia (includes mesh insertion, when performed); reducible), which has a work RVU of 13.76; both of these codes have identical intraservice time and similar total time. Therefore, we are proposing a work RVU of 13.56 for CPT code 315X5.

Additionally, the RUC forwarded invoices provided by a medical specialty society for the video-flexible laryngoscope system used in these services. As discussed in section II.A of this proposed rule, we have proposed changes to the items included in equipment item ES031 (video system, endoscopy). Consistent with those proposed changes, we are proposing to add a Nasolaryngoscope, non-channeled, to the list of equipment items used for CPT codes 31580, 31584, 31587, and 315X1-315X6, along with the modified equipment item ES031.

(16) Mechanochemical Vein Ablation (MOCA) (CPT Codes 364X1 and 364X2)

At the October 2015 CPT meeting, the CPT Editorial Panel established two Category I codes for reporting venous mechanochemical ablation, CPT codes 364X1 and 364X2. We are proposing the RUC-recommended work RVU of 3.50 for CPT code 364X1. For CPT code 364X2 we believe that the RUC-recommended work RVU of 2.25 does not accurately reflect the typical work involved in furnishing this procedure. The specialty society survey recommended that this add-on code has half the work of the base code, CPT code 364X1. This value is supported by the ratio between work and time in the key reference service, CPT code 36476 (Endovenous ablation therapy of incompetent vein, extremity, inclusive of all imaging guidance and monitoring, percutaneous, radiofrequency; second and subsequent veins treated in a single extremity, each through separate access sites (List separately in addition to code for primary procedure)). Therefore, we are proposing a work RVU of 1.75 for CPT code 364X2.

The RUC-recommended direct practice expense inputs for CPT codes 364X1 and 364X2 included inputs for an ultrasound room (EL015). Based on the clinical nature of these procedures, we do not believe that an ultrasound room would typically be used to furnish these procedures. We are proposing to remove inputs for the ultrasound room and put in a portable ultrasound (EQ250), power table (EF031), and light (EF014). The RUC also recommended that the ultrasound machine be allocated clinical staff time based on the PACS workstation formula. We do not believe that an ultrasound machine would be used like a PACS workstation, as images are generated and reviewed in real time. Therefore, we are proposing to remove all inputs associated with the PACS workstation.

(17) Esophageal Sphincter Augmentation (CPT Codes 432X1 and 432X2)

In October 2015, the CPT Editorial Panel created two new codes to describe laparoscopic implantation and removal of a magnetic bead sphincter augmentation device used for treatment of gastroesophageal reflux disease (GERD). The RUC noted that the specialty societies conducted a targeted survey of the 145 physicians who have been trained to furnish these services and who are the only physicians who have performed these procedures. They noted that only 18 non-conflicted survey responses were received despite efforts to follow up and that nine physicians had no experience in the past 12 months with the procedure. The RUC agreed with the specialty society that the expertise of those responding was sufficient to consider the survey, however, neither entity used the survey results as the as the primary basis for their recommended value.

For CPT code 432X1, the RUC recommended a work RVU of 10.13. We compared this code to CPT code 43180 (Esophagoscopy, rigid, transoral with diverticulectomy of hypopharynx or cervical esophagus (e.g., Zenker's diverticulum), with cricopharyngeal myotomy, includes use of telescope or operating microscope and repair, when performed), which has a work RVU of 9.03 and has identical intraservice time and similar total time. We believe the overall intensity of these procedures is similar, therefore, we are proposing a work RVU of 9.03 for CPT code 432X1.

For CPT code 432X2, the RUC recommended a work RVU of 10.47. To value this code, we used the increment between the RUC-recommended work RVU for this code and CPT code 432X1 (0.34 RVUs) to develop our proposed work RVU of 9.37 for CPT code 432X2.

(18) Electromyography Studies (CPT Code 51784)

We identified CPT code 51784 as potentially misvalued through a screen of high expenditure by specialty. This family also includes CPT code 51785 (Needle electromyography studies (EMG) of anal or urethral sphincter, any technique) but was not included in this survey. Both services have 0-day global periods. The RUC recommended a work RVU of 0.75 for CPT code 51784. We believe that this service is more accurately valued without a global period, since that is more consistent with other diagnostic services, and specifically, with all the other diagnostic electromyography services. We are proposing a change to the global period from 0-day to no global period, and we are proposing the RUC-recommended work RVU of 0.75 for CY 2017. We are also proposing to change the global period for CPT code 51785 from 0-day to no global period, to be consistent with 51784. Additionally, we are proposing to add CPT code 51785 to the list of potentially misvalued codes to update the value of the service considering the change in global period, and to maintain consistency with 51784.

(19) Cystourethroscopy (CPT Code 52000)

In the CY 2016 PFS final rule with comment period, CMS identified CPT code 52000 through the screen for high expenditure services by specialty screen. The RUC-recommended work RVUs of 1.75 for CPT code 52000 is larger than the work RVUs for all 0-day global codes with 10 minutes of intraservice time and we do not believe that the overall intensity of this service is greater than all of the other codes. Instead, we believe the overall work compares for this code compares favorably to CPT code 58100 (Endometrial sampling (biopsy) with or without endocervical sampling (biopsy), without cervical dilation, any method (separate procedure)), which has a work RVU of 1.53, and has identical intraservice time and similar total time. Therefore, we are using a direct crosswalk to CPT code 58100 and are proposing a work RVU of 1.53 for CPT code 52000.

(20) Biopsy of Prostate (CPT Code 55700)

In the CY 2016 PFS final rule with comment period, CMS identified CPT code 55700 as potentially misvalued based on the high expenditure by specialty screen.

The RUC subsequently reviewed this code for physician work and practice expense and recommended a work RVU of 2.50 based on the 25th percentile of the survey. We believe the RUC-recommended work RVU overestimates the work involved in furnishing this service given the reduction in total service time; specifically, the reduction in preservice and postservice times. The RUC recommendation also appears overvalued when compared to similar 0-day global services with 15 minutes of intraservice time and comparable total Start Printed Page 46249times. To develop a proposed work RVU, we crosswalked the work RVUs for this code from CPT code 69801 (Labyrinthotomy, with perfusion of vestibuloactive drug(s), transcanal), noting similar levels of intensity, similar total times, and identical intraservice times. Therefore, we are proposing a work RVU of 2.06 for CPT code 55700.

As part of the recommended direct PE inputs for CPT code 55700, the RUC recommended inclusion of a new equipment item, Biopsy Guide, but we have not received any invoices to price this item. Given our longstanding difficulties in acquiring accurate pricing information for equipment items, we are seeking invoices and public comment for pricing this equipment prior to adding this new equipment item code.

(21) Hysteroscopy (CPT Codes 58555-58563)

In the CY 2016 PFS proposed rule, we proposed CPT code 58558 as a potentially misvalued code based on the screen for high expenditure by specialty screen. This code was reviewed at the January 2016 RUC meeting and CPT codes 58559-58563 were included in the review as part of the family.

For CPT code 58555, the RUC recommended a work RVU of 3.07. We believe that the 25th percentile of the survey, a work RVU of 2.65, more accurately reflects the resources involved in furnishing this service. This value is bracketed by two crosswalk codes, CPT code 43191 (Esophagoscopy, rigid, transoral; diagnostic, including collection of specimen(s) by brushing or washing when performed (separate procedure)), which has a work RVU of 2.49, and CPT code 31295 (Nasal/sinus endoscopy, surgical; with dilation of maxillary sinus ostium (e.g., balloon dilation), transnasal or via canine fossa), which has a work RVU of 2.70. Compared with CPT code 58555, CPT codes 43191 and 31295 have identical intraservice times and similar total times. Therefore, we are proposing a work RVU of 2.65 for CPT code 58555.

For CPT code 58558, the RUC recommended a work RVU of 4.37. However, we believe that a direct crosswalk from CPT code 36221 (Non-selective catheter placement, thoracic aorta, with angiography of the extracranial carotid, vertebral, and/or intracranial vessels, unilateral or bilateral, and all associated radiological supervision and interpretation, includes angiography of the cervicocerebral arch, when performed), which has a work RVU of 4.17, and which has identical intraservice time and very similar total time, more accurately reflects the time and intensity of furnishing this service. This value is additionally supported by using an increment between this code and the base code for this family, CPT code 58555. The increment between the RUC-recommended values for these two codes is 1.3. That increment added to the proposed work RVU of 2.65 for the base code, CPT code 58555, results in a work RVU of 3.95. Therefore, we are proposing a work value of 4.17 RVUs for CPT code 58558.

For CPT code 58559, the RUC recommended a work RVU of 5.54. However, we believe that a direct crosswalk of the work RVUs for CPT code 52315 (Cystourethroscopy, with removal of foreign body, calculus, or ureteral stent from urethra or bladder (separate procedure); complicated), which has a work RVU of 5.20 and which has a similar (slightly higher) intraservice time and similar total time as compared with CPT code 58589 more accurately reflects the time and intensity of furnishing this service. This value is additionally supported by using an increment between CPT code 58559 and the base code for this family, CPT code 58555. The increment between the RUC recommended values for the two codes is 2.47. That increment added to the proposed value for the base code, CPT code 58555 (2.65), results in a work RVU of 5.12. Therefore, we are proposing a work RVU of 5.20 for CPT code 58559.

For CPT code 58560, the RUC recommended a work RVU of 6.15. However, we believe that a direct crosswalk of the work RVUs for CPT code 52351 (Cystourethroscopy, with ureteroscopy and/or pyeloscopy; diagnostic), which has a work RVU of 5.75 and which has more intraservice time and very similar total time, more accurately reflects the time and intensity of furnishing this service. This value is additionally supported by using an increment between CPT code 58560 and the base code for this family, CPT code 58555. The increment between the RUC recommended values for the two codes is 3.08. That increment added to the proposed value for the base code, CPT code 58555 (2.65), results in a work RVU of 5.73. Therefore, we are proposing a work RVU of 5.75 for CPT code 58560.

For CPT code 58561, the RUC recommended a work RVU of 7.00. However, we believe that a direct crosswalk of the work RVUs for CPT code 35475 (Transluminal balloon angioplasty, percutaneous; brachiocephalic trunk or branches, each vessel), which has a work RVU of 6.60 and which has similar intraservice and total times, more accurately reflects the time and intensity of furnishing this service. This value is additionally supported by using an increment between CPT code 58561 and the base code for this family, CPT code 58555. The increment between the RUC recommended values for the two codes is 3.93. That increment added to the proposed value for the base code, CPT code 58555 (2.65), results in a work RVU of 6.58. Therefore, we are proposing a work RVU of 6.60 for CPT code 58561.

For CPT code 58562, the RUC recommended a work RVU of 4.17. However, we believe that a direct crosswalk of the work RVUs for CPT code 15277 (Application of skin substitute graft to face, scalp, eyelids, mouth, neck, ears, orbits, genitalia, hands, feet, and/or multiple digits, total wound surface area greater than or equal to 100 sq cm; first 100 sq cm wound surface area, or 1% of body area of infants and children), which has a work RVU of 4.00 and which has identical intraservice time and similar total time, more accurately reflects the time and intensity of furnishing this service. The RUC also used this code as one of its supporting codes for its recommendation. This value is additionally supported by using an increment between CPT code 58562 and the base code for this family, CPT code 58555. The increment between the RUC recommended values for the two codes is 1.10. That increment added to the proposed value for the base code, CPT code 58555 (2.65), results in a work RVU of 3.75. Therefore, we are proposing a work RVU of 4.00 for CPT code 58562.

For CPT code 58563, the RUC recommended a work RVU of 4.62. However, we believe that a direct crosswalk of the work RVUs for CPT code 33962 (Extracorporeal membrane oxygenation (ECMO)/extracorporeal life support (ECLS) provided by physician; reposition peripheral (arterial and/or venous) cannula(e), open, 6 years and older (includes fluoroscopic guidance, when performed)), which has a work RVU of 4.47 and which has identical intraservice time and similar total time, more accurately reflects the resources involved in furnishing this service. This value is additionally supported by using an increment between CPT code 58563 and the base code for this family, CPT code 58555. The increment between the RUC recommended values for the two codes is 1.55. That increment added to the proposed value for the base code, CPT code 58555 (2.65), results in a work RVU of 4.20. We note that CPT code 58563 has the same instraservice time and the same total time as CPT code 58558; however, we agree that the Start Printed Page 46250intensity would be slightly higher for this service. Therefore, we are proposing a work RVU of 4.47 for CPT code 58562.

The RUC submitted invoices for two new equipment items used in furnishing CPT code 58558, the Hysteroscopic Fluid Management System and the Hysteroscopic Resection System. We are proposing to use these invoice prices for the Hysteroscopic Fluid Management System, which totaled $14,698.38. The Hysteroscopic Resection System included the price of the hysteroscope as well as other items necessary for tissue removal. However, we generally price endoscopes separately and not as a part of a system. In order to maintain consistency, we are proposing not to include the hysteroscope from the Resection System. Instead, we are proposing to update the equipment item “endoscope, rigid, hysteroscopy” (ES009) with the invoice price, $6,207.50. We are not proposing to include the sterilization tray from the Hysteroscopic Resection System because we believe this tray has generally been characterized as an indirect expense. For the Hysteroscopic Resection System, we are proposing to include the Hysteroscopic tissue remover ($18,375), the sheath ($1,097.25), and the calibration device ($300), and creating a new equipment item code, priced at $19,857.50 in the proposed direct PE input database. We did not propose to include the calibration device since the submitted price was not documented with a paid invoice.

(22) Epidural Injections (CPT Codes 623X5, 623X6, 623X7, 623X8, 623X9, 62X10, 62X11, and 62X12)

We are proposing the RUC-recommended work RVU for all eight of the codes in this family.

We are proposing to remove the 10-12ml syringes (SC051) and the RK epidural needle (SC038) from all eight of the codes in this family. These supplies are duplicative, as they are included in the epidural tray (SA064). As an alternative, we could remove the epidural tray and replace it with the individual supply components used in each procedure; we are seeking public comment on either the inclusion of the epidural tray or its individual components for this family of codes.

(23) Endoscopic Decompression of Spinal Cord (CPT code 630X1)

For CY 2016, the CPT Editorial Panel created CPT code 630X1 to describe the endoscopic decompression of neural elements. The RUC recommended a work RVU of 10.47 based on a crosswalk to CPT code 47562 (Laparoscopy, surgical; cholecystectomy) with a higher intraservice time than reflected in the survey data. Since we believe CPT codes 630X1 and 47562 are similar in intensity, we believe using the same work RVU as the crosswalk code overestimates the work involved in furnishing CPT code 630X1. Reference CPT code 49507 (Repair initial inguinal hernia, age 5 years or older; incarcerated or strangulated) has a work RVU of 9.09 and has similar intensity and an identical intraservice time compared to CPT code 630X1. Therefore, we are proposing a work RVU of 9.09 for CPT code 630X1.

(24) Retinal Detachment Repair (CPT Codes 67101 and 67105)

For CY 2015, the CPT Editorial Panel made several changes to CPT codes 67101 and 67105. These changes include revising the code descriptors to exclude “diathermy” and “with or without drainage of subretinal fluid” and removing the reference to “1 or more sessions”. The recommended global period has also changed from 90 days to 10 days.

For CPT code 67101 we propose the RUC recommendation of 3.50 work RVUs, which was based on the 25th percentile of the survey. For CPT code 67105, the RUC recommended a work RVU of 3.84 based on the 25th percentile of the survey. The RUC also stated that CPT code 67105 was a more intense procedure, and therefore, should have a higher work RVU than CPT code 67101. Currently, CPT code 67101 has a higher work RVU than CPT code 67105 and according to the surveys the intraservice and total times remain higher for CPT code 67101. It was not clearly explained and we do not understand why the RUC believes that CPT code 67105 is more work than CPT code 67101. Therefore we are not proposing the RUC-recommended work value of 3.50 for CPT code 67105. We do not find evidence that CPT code 67105 is more intense than CPT code 67101 and accordingly propose a new value for CPT code 67105. To value CPT code 67105 we used the RVU ratio between 67101 and 67105. We divided the current work RVU of CPT code 67105 (8.53), by the current work RVU of CPT code 67101 (8.80) and multiplied the quotient by the RUC-recommended work RVU for CPT code 67101 (3.50) to arrive at a product of 3.39 work RVUs.

Therefore, for CY 2017 we are proposing a work RVU of 3.39 for CPT code 67105.

(25) Abdominal Aortic Ultrasound Screening (CPT Code 767X1)

For CY 2017, the CPT Editorial Panel created a new code, CPT 767X1, to describe abdominal aortic ultrasound screening, currently described by HCPCS G-code G0389. The specialties that surveyed CPT code 767X1 for the RUC were vascular surgery and radiology, and the direct practice expense inputs recommended by the RUC included an ultrasound room. Based on an analysis of Medicare claims data, the dominant specialties furnishing the service are family practice and internal medicine. We believe that these specialties may more typically use a portable ultrasound device rather than an ultrasound room. Therefore, we are proposing to accept the RUC-recommended work value of 0.55, and the RUC-recommended PE inputs for this service, but we are seeking comment regarding whether or not it would be more accurate to substitute a portable ultrasound device or possibly a hand-held device for an ultrasound room for CPT code 767X1. We note that while the phase-in of significant reductions in RVUs ordinarily would not apply to new codes, we believe that it would be appropriate to consider this change from a G-code to a CPT code to be fundamentally similar to an editorial coding change since the service is not described differently, and therefore, we propose to apply the phase-in to this service by comparing the previous value of the G-code to the value for the new CPT code.

(26) Fluoroscopic Guidance (CPT Codes 77001, 77002, and 77003)

In the CY 2015 PFS final rule with comment period, CMS indicated that while CPT codes 77002 and 77003 had been previously classified as stand-alone codes without global periods, we believe their vignettes and CPT Manual parentheticals are consistent with an add-on code as has been established for CPT code 77001. Therefore, the global periods for CPT codes 77002 and 77003 now reflect an add-on code global period with modifications to the vignettes and parentheticals.

For CPT code 77001, we are proposing the RUC-recommended work RVU of 0.38. The RUC-recommended work RVUs for CPT codes 77002 and 77003 do not appear to account for the significant decrease in total times for these codes relative to the current total times. We note that these three codes describe remarkably similar services and have identical intraservice and total times. Based on the identical times and Start Printed Page 46251notable similarity for all three of these codes, we are proposing a work RVU of 0.38 for all three codes.

(27) Radiation Treatment Devices (CPT Codes 77332, 77333, and 77334)

We identified CPT codes 77332, 77333, and 77334 through the high expenditures by specialty screen. These services represent an incremental increase of complexity from the simple to the intermediate to the complex in design of radiation treatment devices. The RUC recommended no change from the current work RVUs for these codes, which are currently 0.54 for CPT code 77332, 0.84 for CPT code 77333 and 1.24 for CPT code 77334. We believe the recommended work RVUs overstate the work involved in furnishing these services, as they do not sufficiently reflect the degree to which the RUC concurrently recommended a decrease in intraservice or total time. For CPT code 77332, we believe the RUC recommendation to maintain its current value despite a 34 percent decrease in total time appears to ignore the change in time. Therefore, we are proposing a value for this code based on a crosswalk from the value from CPT code 93287 (Peri-procedural device evaluation (in person) and programming of device system parameters before or after a surgery, procedure, or test with analysis, review and report by a physician or other qualified health care professional; single, dual, or multiple lead implantable defibrillator system)), due to its identical intraservice time, similar total time, and similar level of intensity. We are therefore proposing a work RVU of 0.45 for CPT code 77332. We are further supporting this valuation with HCPAC code 97760 (Orthotic(s) management and training (including assessment and fitting when not otherwise reported) upper extremity(s), lower extremity(s) and/or trunk, each 15 minutes), which has similar physician time and intensity measurements and a work RVU of 0.45. As these codes are designed to reflect an incremental increase in work value from simple, to intermediate, and complex device designs, we used an incremental difference methodology to value CPT codes 77333 and 77334. We are proposing a work RVU of 0.75 for CPT code 77333, maintaining its recommended increment from CPT code 77332, For CPT code 77334, we are proposing a work RVU of 1.15 which maintains its increment from CPT code 77332.

(28) Special Radiation Treatment (CPT Code 77470)

We identified CPT code 77470 through the high expenditure charges by specialty. We are proposing the RUC-recommended work RVU of 2.03. However, we believe the description of service and vignette describe different and unrelated treatments being performed by the physician and clinical staff for a typical patient, and this presents a disparity between the work RVUs and PE RVUs. We seek public comment on information that would clarify this apparent disparity to help determine appropriate PE inputs. In addition, we seek comment to determine if creating two G-codes, one which describes the work portion of this service, and one which describes the PE portion, may be a potentially more accurate method of valuing and paying for the service or services described by this code.

(29) Flow Cytometry Interpretation (CPT Codes 88184, 88185, 88187, 88188, and 88189)

The Flow Cytometry Interpretation family of codes is split into a pair of codes used to describe the technical component of flow cytometry (CPT codes 88184 and 88185), which do not have a work component, and a trio of codes (CPT codes 88187, 88188, and 88189) which do not have direct practice expense inputs, as they are professional component only services. CPT codes 88184 and 88185 were reviewed by the RUC in April 2014, and their CMS refined values were included in the CY 2016 PFS final rule with comment period. The full family of codes was reviewed again at the January 2016 RUC meeting, and new recommendations were submitted to CMS as part of the CY 2017 PFS rulemaking cycle.

We are proposing the RUC-recommended work RVU of 0.74 for CPT code 88187, and the RUC-recommended work RVU of 1.70 for CPT code 88189. For CPT code 88188, we are proposing a work RVU of 1.20 instead of the RUC-recommended work RVU of 1.40. We arrived at this value by noticing that there were no comparable codes with no global period in the RUC database with intraservice time and total time of 30 minutes that had a work RVU higher than 1.20. The RUC-recommended work RVU of 1.40 would go beyond the current maximum value and establish a new high, which is not consistent with our estimation of the overall intensity of this service relative to the others. As a result, we believe it is more accurate to crosswalk CPT code 88188 to the work value of the code with the current highest value, which is CPT code 88120 (Cytopathology, in situ hybridization (for example, FISH), urinary tract specimen with morphometric analysis, 3-5 molecular probes) at a work RVU of 1.20. We believe that CPT code 88120 is crosswalk comparable code since it shares the identical intraservice time and total time of 30 minutes with CPT code 88188.

We also noted that the survey increment between CPT codes 88187 and 88188 at the RUC-recommended 25th percentile was 0.40 (between work RVUs of 1.00 and 1.40), and this increment of 0.40 when added to CPT code 88187's work RVU of 0.74 would arrive at a value of 1.14. In addition, the total time for CPT code 88188 decreases from 43 minutes to 30 minutes, which is a ratio of 0.70, and when this time ratio is multiplied by CPT code 88188's previous work value of 1.69, the result would be a new work RVU of 1.18. With this information in mind, we are proposing a work RVU of 1.20 for CPT code 88188 as a result of a direct crosswalk to CPT code 88120.

For CPT codes 88184 and 88185, which describe the technical component of flow cytometry, we are proposing to use the RUC-recommended inputs with a series of refinements. However, we believe that the coding for these two procedures may inhibit accurate valuation. CPT code 88184 describes the first marker for flow cytometry, while CPT code 88185 is an add-on code that describes each additional marker. We believe that it may be more accurate to have a single CPT code that describes the technical component of flow cytometry on a per patient case basis, as these two procedures are always performed together and it is difficult to determine the clinical labor, supplies, and equipment used in the typical case under the current coding structure. We are soliciting comments regarding the public interest in consolidating these two procedures into a single code used to describe the technical component of flow cytometry.

Absent such a change in coding, we are proposing to refine the clinical labor time for “Instrument start-up, quality control functions, calibration, centrifugation, maintaining specimen tracking, logs and labeling” from 15 minutes to 13 minutes for CPT code 88184. We maintain that 13 minutes for this activity, which is the current time value, would be typical for the procedure, as CPT code 88182 also uses 13 minutes for the identical clinical labor task. We are also proposing to refine the L054A clinical labor for Start Printed Page 46252“Load specimen into flow cytometer, run specimen, monitor data acquisition, and data modeling, and unload flow cytometer” from 10 minutes to 7 minutes using the same rationale, a comparison to CPT code 88182.

We are proposing to maintain the clinical labor for “Print out histograms, assemble materials with paperwork to pathologists Review histograms and gating with pathologist” for CPT code 88184 at 2 minutes, as opposed to the RUC-recommended 5 minutes. A clinical labor time of 2 minutes is standard for this activity; we disagree with the RUC rationale that reviewing histograms and gating with the pathologist in this procedure is not similar to other codes. We also note that the review of histograms with a pathologist is not even described by CPT code 88184, which again refers to the technical component of flow cytometry, not the professional component. We are also proposing to refine the L033A clinical labor time for “Clean room/equipment following procedure” from 2 minutes to 1 minute for CPT code 88184. We have established 1 minute in previous rulemaking (80 FR 70902) as the standard time for this clinical labor activity in the laboratory setting.

We are proposing to maintain our removal of the clinical labor time for “Enter data into laboratory information system, multiparameter analyses and field data entry, complete quality assurance documentation” for both CPT code 88182 and CPT code 88184. As we stated in last year's final rule with comment period (80 FR 70979), we have not recognized the laboratory information system as an equipment item that can be allocated to an individual service. We continue to believe that this is a form of indirect PE, and therefore, we do not recognize the laboratory information system as a direct PE input, and we not consider this task as typically performed by clinical labor on a per-service basis.

We are proposing to maintain the quantity of the “lysing reagent” supply (SL089) at 2 ml for CPT code 88185, as opposed to the RUC-recommended quantity of 3 ml. In our discussions with pathology specialists who perform flow cytometry, we were informed that the use of 50-55 ml of the lysing reagent would be typical for an entire patient case. The RUC recommendation similarly suggested a quantity of 46 ml or 48 ml per patient case. We were also told that the most typical number of markers used for flow cytometry is 24, consisting of 1 service of CPT code 88184 and 23 services of CPT code 88185. An investigation of our claims data confirmed this information, indicating that 24 markers is the most frequent per patient case for flow cytometry, and the use of more than 20 markers is typical. We believe that this data supports our refinement of the lysing reagent from a quantity of 3 ml to a quantity of 2 ml for CPT code 88185, which is also the current value for the procedure and the RUC-recommended value from the previous set of recommendations. For the typical case of 24 markers, our value would produce a total lysing reagent quantity of 51 ml (5 ml from the single service of CPT code 88184 and 46 ml from the 23 services of CPT code 88185), which matches with the amount required for a total per patient case. If we were to adopt the RUC recommendation, the total lysing reagent quantity would be 74 ml, which is well in excess of what we believe to be typical for these procedures.

We are also proposing to refine the quantity of the “antibody, flow cytometry” supply (SL186) from quantity 1.6 to quantity 1, which is also the current value for the supply and the RUC-recommended value from the previous set of recommendations. We do not agree that more than one antibody would be typically used for each marker. We are reaffirming the previous RUC recommendation, and maintaining the current quantity of 1 antibody for each marker.

We are not proposing the recommended additional time for the “printer, dye sublimation (photo, color)” equipment (ED031). We are proposing to maintain the equipment time at 2 minutes for CPT code 88184, and at 1 minute for CPT code 88185. As we stated in the CY 2016 PFS final rule with comment period (80 FR 70979), we are proposing to assign equipment time for the dye sublimation printer to match the clinical labor time for “Print out histograms, assemble materials with paperwork to pathologists.” We do not believe that it would be typical for the printer to be in use longer than it takes to accomplish this clinical labor task.

(30) Mammography—Computer Aided Detection Bundling (CPT Codes 770X1, 770X2 and 770X3)

Section 104 of the Medicare, Medicaid, and SCHIP Benefits Improvement and Protection Act of 2000 (BIPA) (Pub. L. 106-554) required us to create separate codes with higher payment amounts for digital mammography compared to film mammography, which was the technology considered to be typical at the time. In addition, the statute required additional payment to be made when computer-aided detection (CAD) was used.

In CY 2002, we began valuing digital mammography services using three G-codes, G0202, G0204, and G0206 to describe screening mammography, unilateral diagnostic mammography, and bilateral diagnostic mammography, respectively. CMS implemented the requirements of BIPA section 104(d)(1), which applied to tests furnished in 2001, by using the work RVUs of the parallel CPT codes, but establishing a fixed PE RVU rather than using PE RVUs developed under the standard PE methodology. The fixed amount of PE RVUs for these codes has generally remained unchanged since implementation of the G-codes that specifically described digital imaging.

Most mammography services under Medicare have since been billed with these G-codes when digital mammography was used, and with CPT codes 77055, 77056, and 77057 when film mammography was used. The use of CAD has been reported with CPT codes 77051 and 77052. For CY 2017, the CPT Editorial Panel deleted CPT codes 77051, 77052, 77055, 77056, 77057 and created three new CPT codes, 770X1, 770X2, and 770X3, to describe mammography services bundled with CAD. For CY 2017, the RUC recommended a work RVU of 0.81 for CPT code 770X1, a work RVU of 1.00 for CPT code 770X2, and a work RVU of 0.76 for CPT code 770X3, as well as new PE inputs for use in developing resource-based PE RVUs based on our standard methodologies. The RUC has recommended these inputs and only one medical specialty society has provided us with a set of single invoices to price the equipment used in furnishing these services.

We have reviewed these coding changes and recommended changes to valuation for CY 2017. The revised CPT coding mitigates the need for both separate G-codes and the CAD add-on codes. Based upon these coding changes and the recommended input values, overall Medicare payment for mammography services would be drastically reduced. This is especially the case for the technical component of these services, which could possibly be reduced up to 50 percent relative to the PE RVUs currently used for payment for these services.

Based on our initial review of the recommended inputs for the new codes, we believe that these changes would likely result in values more closely related to the relative resources involved in furnishing these services. However, we recognize that these services, particularly the preventive Start Printed Page 46253screenings, are of particular importance to the Medicare program and the health of the Medicare beneficiaries. We are concerned that making drastic changes in coding and payment for these services could be disruptive in ways that could affect beneficiary access to necessary services. We also recognize that unlike almost any other high-volume PFS service, the RVUs used for payment for many years have not been developed through the generally applicable PFS methodologies, and instead reflect the statutory directive under section 104 of the BIPA. Similarly, we recognize that the changes in both coding and valuation are significant changes for those who provide these services. Therefore, instead of proposing to simultaneously adopt the revised CPT coding and drastic reductions in overall payment rates, we believe it is advisable to adopt the new coding, including the elimination of separate billing for CAD, for CY 2017 without proposing immediate implementation of the recommended resource inputs. We anticipate that we will consider the recommended inputs, including the pricing of the required equipment, as carefully as possible prior to proposing revised PE values through subsequent rulemaking.

Therefore, for CPT codes 770X1, 770X2, and 770X3, we are proposing to accept the RUC-recommended work RVUs, but to crosswalk the PE RVUs for the technical component of the current corresponding G-codes, as we seek further pricing information for these equipment items.

In addition to seeking comment on this proposal, we are also seeking comment on rates for these services in the commercial market to help us understand the potential impacts of any future proposed revisions to PFS payment rates.

Finally, we note that by adopting the new coding for CY 2017, any subsequent significant reduction in RVUs (greater than 20 percent) for the codes would be subject to the statutory phase-in under section 1848(c)(7).

To help us examine the resource inputs for these services, we are seeking public comment on the list of items recommended as equipment inputs for mammography services. We also invite commenters to provide any invoices that would help with future pricing of these items.

Table 17—Recommended Equipment Items for Mammography Services

#Item descriptionQuantityPurpose
12D Selenia Dimensions Mammography System1Mammography unit and in-room console itself.
2Mammo Accreditation Phantom1Required for MQSA. The phantom is currently valued into the existing mammography room.
3Phantom Case1Protects expensive required phantom from damage.
4Paddle Storage Rack3It requires 3 racks to hold and prevent damage to all of the paddles that are part of the typical standard mammography system.
5Needle Localization Kit1Needed for a full functioning mammography room. Allows for the performance of needle localizations. Input is not separately in the PE for the mammography guided procedure codes, 19281-19282, as a fully functioning mammography room is needed for those procedures.
6Advanced Workflow Manager System1Workflow system connecting mammography room and workstations.
7Cenova 2D Tower System1CAD server, and also used for post-processing.
8Image Checker CAD (9.4) License for One FFDM1License required for using CAD. This is a one-time fee.
9Film Digitizing System1Digitizes analog films to digital for comparison purposes.
10Mammography Chair1A special chair needed for patients who cannot stand to safely have their mammogram performed.
11Laser Imager Printer1Prints high resolution copies of the mammograms to send to surgeons and oncologists, and to use in the OR.
12Barcode Scanner1Allows selection of individual patient file for interpretation.
13MRS V7 SQL Reporting System1MQSA requires that the facility develop and maintain a database that tracks recall rates from screening, true and false positive and true and false negative rates, sensitivity, specificity, and cancer detection rate. A reporting system is required to build the required database and produce the federally required quality audit. Components below needed for the reporting system. The reporting system is currently valued into the existing mammography room.
14Worksheet Printing Module1Database reports are required for federal tracking purposes. This is used to generate reports for MQSA.
15Site License1License for site to use the reporting system. This is a one-time fee.
16Additional Concurrent User License3Licenses for radiologists to use the reporting system. A minimum of three additional licenses is typical.
17Densitometer1Required for MQSA.

We also received specialty society recommendations for a new Equipment Item, a physician PACS mammography workstation. We note that we discuss physician PACS workstation in section II.A of this rule. The items that comprise the physician PACS mammography workstation are listed in Table 18. We are requesting public comment as to the appropriateness of this list and if some items are indirect expenses or belong in other codes. We also invite commenters to provide any invoices that would help with future pricing of these items.

Table 18—Physician PACS Mammography Workstation

PC Tower.
Monitors 5 MP (mammo) (x2).
3rd 4th monitor (for speech recognition, etc.).
Admin Monitor (the extra wor