Issue 15, Winter 2022
General OrthoForum Policy Issues
HHS Extends Determination of a Public Health Emergency
The determination under section 319 of the Public Health Service Act of the existence of a public health emergency (PHE) due to Covid-19 would have expired on January 16, 2022. On January 14, however, the Secretary of Health and Human Services, Xavier Becerra, extended the PHE determination. Under section 319, each extension of the PHE is for a 90-day period. The last extension was made on October 18, 2021.
Physician Fee Schedule for CY 2022
Legislation Enacted to Mitigate Payment Cuts: On December 10, 2021, a bill was enacted (S. 610; Public Law 117-71) that provides for the following:
- The 2% Medicare sequester cut under the Budget Control Act of 2011 (BCA) that would have taken effect on January 1 is delayed entirely through March 31. For April through June, the BCA cut will be 1%. Beginning with July, the BCA cut will be 2%.
- The 4% Medicare sequester cut under the Statutory Pay-As-You Go Act of 2010 that would have taken effect on January 1 will not take effect at all.
- The PFS cut in the conversion factor scheduled to take effect on January 1 is reduced from 3.75 to 0.75%.
PFS Final Rule: The final rule for 2022 was published in the Federal Register on November 19, 2021. Its provisions include the following:
- Conversion factor: Reduced from the 2021 level of 34.8931 (which reflected action taken by Congress in December 2020 to reduce the 2021 cut) to 33.5983 for 2022, a reduction of 1.2948 (3.75 percent). As noted, however, Congress took action in December 2021 to reduce this 2022 cut.
- Telehealth: Would continue through the end of 2023 many of the temporary Medicare telehealth flexibilities allowed during the Covid-19 public health emergency (PHE), even if the PHE ends well before then. These are what CMS refers to as “category 3” services, which do not currently meet the criteria to be made permanent as a category 1 or category 2 service.
- Appropriate use criteria (AUC) for determining when the use of advanced diagnostic imaging is appropriate: The effective date for AUC program claims processing edits and for the payment penalty phase is the later of January 1, 2023, or the January 1 that follows a government declaration ending the PHE.
- Split/shared E/M services: When both a physician and a non-physician practitioner (NPP) provide services to a patient for an E/M visit in the facility setting, the person who provides the “substantive portion” of the services will bill for the visit and reimbursement will be based on the rate applicable to that person (physician or NPP, as the case may be). The rule is that time, and not medical decision making (MDM), is the determinative factor; therefore, whoever provides more than 50 percent of the total time for the visit is providing the “substantive portion”. For 2022 only, however, there is a special rule (except that it is not applicable to critical care visits). For that one year, there are options—the substantive portion can be determined (1) by time (more than 50 percent), or (2) by performing the history, or (3) by performing the exam, or (4) by performing the MDM.
As to the telehealth flexibilities administratively created by CMS during the PHE, continuing the flexibilities for physical therapists and occupational therapists after the end of the PHE is a matter for Congress, as CMS does not have the statutory authority to take such action. It may be that Congress will not take decisive action on telehealth issues until it believes that the PHS is nearing its end. The bill supported by the Advocacy Committee, the Telehealth Modernization Act (S. 368; H.R. 1332), continues to gain support in Congress. As of mid-January, the House bill has 110 cosponsors (53 Democrats and 57 Republicans), and the Senate bill has 18 (six Democrats, one Independent, and 11 Republicans).
Medicare Prior Authorization Requirements; New House Bill on Electronic Process
The Advocacy Committee supports a bipartisan bill that was introduced in the House of Representatives on May 13, 2021, to require Medicare Advantage plans to electronically issue real-time prior-authorization decisions. This requirement would take effect with the second plan year beginning after the bill’s enactment. The bill is H.R. 3173, the Improving Seniors’ Timely Access to Care Act of 2021, which was introduced by Representatives Suzan DelBene (D-WA) and Mike Kelly (R-PA). As of mid-January, the bill had 252 cosponsors, of which 141 were Democrats and 111 were Republicans. The bill clearly has momentum and now has more than the number of supporters necessary to pass the bill in the House (218). The bill’s cosponsors include senior Democrats and Republicans on the two committees of jurisdiction, House Energy & Commerce and House Ways & Means.
Cybersecurity
The Advocacy Committee continues to have discussions about developing legislation to protect physician group practices (PGPs) from penalties under federal law for data breaches. The approach under discussion is that, when a data breach occurs as a result of a cyberattack, a PGP would be protected from federal penalties if it is in compliance with appropriate federal standards on data security; it has applied the HIPAA Security Risk Assessment Tool developed by the federal Department of Health and Human Services; and it has had its compliance with those federal standards confirmed through an audit by a third party. Although enacting legislation is the ultimate goal, there is also discussion of advocating for policies that would be helpful and could be implemented by the relevant federal agencies under their current authorities (i.e., without the enactment of additional legislation).
No Surprises Act; October Interim Final Rule
Qualifying Payment Amount: The second interim final rule to implement the No Surprises Act was published in the Federal Register on October 7, 2021. It includes provisions on the “independent dispute resolution” (IDR) process (including arbitration) that are not favorable to physicians. The IDR provisions of concern relate to the “qualifying payment amount” (QPA), which (for a particular item or service) is the median in-network contracted rate in the geographic area involved for the applicable insurance market (large group market, small group market, or individual market) as adjusted for inflation occurring after January 31, 2019.
The No Surprises Act specifies that the QPA is only one of the factors to be considered in the IDR process, but the October final rule gives that factor priority above all the other factors. There are five other factors, which are (1) the level of training, experience, and quality and outcomes measurements of the provider or facility; (2) the market share held by the provider or facility or that of the plan or issuer in the geographic region involved; (3) the acuity of the participant, beneficiary, or enrollee receiving the qualified IDR item or service, or the complexity of furnishing the qualified IDR item or service; (4) the teaching status, case mix, and scope of services of the facility that furnished the qualified IDR item or service, if applicable; and (5) the demonstration of good faith efforts (or lack thereof) made by the provider/facility and the health plan to enter into network agreements with each other, and, if applicable, contracted rates between them during the previous four plan years.
The statutory text of the No Surprises Act does not give priority to the QPA. On October 4, the Chair of the House Ways & Means Committee, Rep. Richard Neal (D-MA), and the Committee’s Ranking Member, Rep. Kevin Brady (R-TX), jointly sent a letter to the Biden administration stating that the approach taken in the final rule “strays from the No Surprises Act in favor of an approach that Congress did not enact in the final law . . . and we are concerned that this approach biases the IDR entity toward one factor (a median rate) as opposed to evaluating all factors equally as Congress intended.” [Emphasis in original.]
On December 28, a letter from 26 Senate Republicans was sent to the Biden Administration stating that the October final rule departs from the “carefully crafted” statutory text by putting “almost exclusive emphasis” on the QPA.
In addition, multiple lawsuits have been filed to challenge the October final rule on this basis, including one filed on December 9 by the American Medical Association and the American Hospital Association.
Good Faith Estimates: Under the No Surprises Act, a requirement took effect on January 1 for providers (including physician group practices and ASCs) to provide good faith estimates (GFEs) to uninsured patients and to “self-pay” patients (those who have a health plan but will not file a claim for payment). Note that this GFE requirement does not apply to patients who have a health plan and will file a claim for payment. It also does not apply to patients with Medicare or Medicaid. The OrthoForum Website has a White Paper and a slide-deck presentation concerning the GFE requirement.
Additional Information
For more information on any of the topics discussed in this section, please contact the chair of the OrthoForum Advocacy Committee, Dr. Richard Bruch, at rich.bruch@gmail.com.
Therapy Services Update
Physician Fee Schedule for CY 2022
Generally: As noted in the section on general policy issues, the final rule for 2022 was published in the Federal Register on November 19, 2021, and for 2022 it reduced the 2021 conversion factor by 3.75%, to 33.5983. Congress, however, took action in December to provide for a cut of only 0.75. In addition, under that December law, the 2% Medicare sequester cut under the Budget Control Act of 2011 (BCA) is delayed entirely through March 31, and will be 1% beginning in April and then 2% beginning in July. And the 4% Medicare sequester cut under the Statutory Pay-As-You Go Act of 2010 will not take effect at all.
New Cuts regarding Therapy Assistants: A law enacted in 2018, which took effect on January 1, 2022, states that a 15% reduction is required when therapy services are “furnished in whole or in part” by a therapy assistant. The law therefore applies to physical therapy assistants (PTAs) and occupational therapy assistants (OTAs). The final rule for 2022 implements this requirement.
In preparing to implement the requirement, CMS began formulating its policies as part of the 2019 PFS proposed rule and finalized what it called the “de minimis” standard, meaning that the reduction would apply only if more than 10 percent of the service is furnished by a PTA or OTA. When the reduction applies, it is billed with the CQ modifier in the case of a PTA and the CO modifier in the case of an OTA. The 2020 PFS final rule applied the reduction both to untimed and timed therapy codes. The untimed codes are evaluation and reevaluation codes, group therapy, and supervised modalities. The timed codes are defined in 15-minute increments. In the 2022 final rule, CMS finalized its proposal to focus on the “8-minute rule” for the final 15-minute unit billed. The final rule contains a number of examples to demonstrate when the 15% reduction applies (and therefore the CQ and CO modifiers must be used in billing). CMS guidance on these modifiers is available [here].
Telehealth Provisions: The final rule continues through the end of 2023 many of the Medicare telehealth flexibilities allowed during the Covid-19 public health emergency (PHE), even if the PHE ends well before then, including CPT codes 97161-97164 for PTs, codes 97165-97168 for OTs, and therapy codes 97110, 97112, and 97116. Therapy codes 97150, 97530, and 97542, however, will not be considered telehealth services once the PHE ends. (In mid-January, HHS extended the PHE for another 90 days.) CMS received requests to make many of these codes permanent, but declined to do so. The agency noted that section 1834(m) of the Medicare statute does not permit PTs and OTs to be telehealth practitioners. (They were allowed to be telehealth practitioners in relation to the PHE under the emergency authority provided in section 1135 of the Social Security Act.) Ensuring that PTs and OTs continue to be full-service telehealth providers is a matter for Congress.
Legislation
New Cuts Regarding Therapy Assistants: A bipartisan bill was introduced in the House on October 8, 2021, that would delay the 15% reduction regarding PTAs and OTAs until January 1, 2023, and would permanently exempt from the reduction PTA and OTA services provided in rural areas or medically underserved areas. The bill is H.R. 5536, introduced by Representatives Bobby Rush (D-IL) and Jason Smith (R-MO). As of mid-January, the bill has 15 cosponsors, of which nine are Democrats and six are Republicans. These include three high-ranking Democrats on the Energy and Commerce Committee (E&C)—G.K. Butterfield (D-NC), Jan Schakowsky (D-Ill), and Tony Cárdenas (D-CA). There are also three E&C Republican cosponsors—Debbie Lesko (R-AZ), David McKinley (R-WV), and Kelly Armstrong (R-ND).
Telehealth: Continuing the flexibilities for PTs and OTs after the end of the public health emergency or the end of 2023 (depending on the particular CPT code) is a matter for Congress. As noted in the section on general policy issues, it may be that Congress will not take decisive action on telehealth issues until it believes that the PHE is nearing its end. The bill supported by the Advocacy Committee, the Telehealth Modernization Act (S. 368; H.R. 1332), continues to gain support in Congress. As of mid-January, the House bill has 110 cosponsors (53 Democrats and 57 Republicans), and the Senate bill has 18 (six Democrats, one Independent, and 11 Republicans). The bill would give CMS the authority to designate PTs and OTs as telehealth practitioners (but would not require the agency to do so).
Therapy Services Subcommittee
For more information on therapy services issues, or to join the OrthoForum Advocacy Committee Therapy Services Subcommittee, please contact Renee Duncan at: renee.duncan@orthotennessee.com.
CMS/CMMI Update
No Surprises Act Independent Dispute Resolution Rule Takes Effect
On January 1, 2022, a rule implementing controversial out-of-network reimbursement policy under the No Surprises Act took effect. As noted in previous newsletters, the No Surprises Act prohibits health care providers from balance billing their out-of-network patients for emergency and certain non-emergency services, instead requiring providers to negotiate reimbursement rates with insurers directly. The rule provides a binding independent dispute resolution procedure for parties unable reach an agreement on payment and outlines factors for consideration during arbitration of the rate dispute.
In December 2021, the American Hospital Association (AHA) and American Medical Association (AMA) filed a lawsuit over the rule’s independent dispute resolution provisions, arguing it provides for an independent dispute resolution process that weighs in favor of the median in-network rate. The lawsuit further argues that such regulatory presumption contradicts lawmakers’ intent behind the No Surprises Act—to create a balanced process to resolve payment disputes between providers and insurers.
On January 7, 2022, AAOS joined several other national and state medical societies in filing an amicus brief to support the AHA and AMA lawsuit. The brief emphasizes the need for equal consideration of all the statutory factors written into the law when determining provider reimbursement rates and argues that the rule facilitates damaging insurer-determined rate-setting practices. AAOS previously submitted formal comments to CMS over the rule reiterating these concerns, and warning that unsustainable reimbursement patterns will accelerate provider consolidation.
CMMI Director Provides Insight on Innovative Direction
On January 19, 2022, CMMI Director Elizabeth Fowler participated in a webinar hosted by United States of Care (USofCare) to discuss the future of the CMS Innovation Center’s ten-year strategic white paper released last October.[1] She outlined key objectives from the CMMI strategic refresh, including plans to drive accountable care, advance health equity, support care innovations, address affordability and align programs across CMS.
Fowler answered questions from audience members regarding the Innovation Center’s community engagement, efforts to ensure inclusive and accessible innovation, and the general direction of the Center’s model portfolio. She discussed the Center’s planned outreach strategy and noted the significance of stakeholder engagement in effective decision-making. When asked about the Center’s accountable care portfolio, Fowler indicated that CMMI is working across CMS to align a more coordinated portfolio and is looking into how their models can work cohesively. She said placing accountable care at the focus of the CMMI’s priorities means the Center can no longer do models focusing on individual episodes or specialties and must instead look for areas of overlap to nest specialized tests—for example within the Medicare Shared Savings Program—rather than testing them as standalone models. When speaking on CMMI’s plans to launch new models or revamp their existing slate, Fowler said the Center is currently examining its portfolio for promising models that have enough participants for evaluation to keep, and it will soon begin implementing a very specific criteria to consider new models in accordance with its new strategy.
CMMI Hosts Listening Session on Strategic Refresh
On November 18, 2021, CMMI held the first listening session for stakeholder feedback on its recently released Innovation Center Strategy Refresh, which outlines the Center’s vision for the next ten years. CMMI requested comments from interested stakeholders discussing any barriers to participation in value based and accountable care models, actions CMS can take to better support providers, strategies for CMMI to better align its models with patient needs, and parameters to accurately measure the impacts of value-based care. CMMI Director Liz Fowler and other officials provided an overview of the Center’s vision and strategy and gave some insight as to next steps for the Center.
CMMI Chief Strategic Officer Dr. Purva Rawal referenced additional listening sessions and other outreach opportunities for beneficiaries that the Center will announce in the near future. He also discussed CMMI’s efforts to make data available for external researchers through the CMS Virtual Research Data Center for further insight on model impacts. He continued that moving forward, the Center plans to broaden its interpretation of successful models to consider impacts beyond those statutorily mandated, including patient experience and access to home and community-based care. A readout of the listening session and stakeholder commentary can be found here.
CMS/CMMI Subcommittee
For more information on CMS/CMMI issues, or to join the OrthoForum Advocacy Committee CMS/CMMI Subcommittee, please contact the chair of the Subcommittee, Dr. Wilford Gibson, at gibsonw@atlanticortho.com.
[1] For a further description of the CMMI Strategic Refresh, see Advocacy Insights Issue 14, Fall 2021
Ambulatory Surgery Center Update
OPPS-ASCs Final Rule
This final rule was published in the Federal Register on November 16, 2021. The conversion factor for 2022 is 49.916 for ASCs meeting the quality reporting requirements, which is an increase of 0.964 above the 2021 conversion factor of 48.952. This is an increase of approximately 2%, which reflects a 2.7% increase on the basis of the hospital market basket that was then reduced by a productivity adjustment of 0.7%. For ASCs not meeting the quality reporting requirements, the 2022 conversion factor is 48.937. These 2022 conversion factors for ASCs are about 59% of the parallel conversion factors for hospital outpatient departments (84.177 if meeting the quality reporting requirements and 82.526 if not).
Note that CMS will continue to use the hospital market basket to update the ASC conversion factor for 2023, but in 2024 plans to return to basing the update on the consumer price index for all urban consumers.
In addition to setting the conversion factors, the provisions of the final include the following:
IPO List: CMS largely reversed the elimination of the inpatient-only (IPO) list, thereby adding back to the list for 2022 most of the procedures that were removed for 2021. The agency did, however, allow three of the procedures removed for 2021 to stay off the IPO list for 2022: (1) CPT code 22630, arthrodesis, posterior interbody technique, including laminectomy and/or discectomy to prepare interspace (other than for decompression), single interspace; lumbar. (2) CPT code 23472, arthroplasty, glenohumeral joint; total shoulder (glenoid and proximal humeral replacement (e.g., total shoulder)). (3) CPT code 27702, arthroplasty, ankle; with implant (total ankle)) and their corresponding anesthesia codes: (A) CPT code 00630, anesthesia for procedures in lumbar region; not otherwise specified; (B) CPT code 00670, anesthesia for extensive spine and spinal cord procedures (e.g., spinal instrumentation or vascular procedures); (C) CPT code 01638, anesthesia for open or surgical arthroscopic procedures on humeral head and neck, sternoclavicular joint, acromioclavicular joint, and shoulder joint; total shoulder replacement; and (D) CPT 01486, anesthesia for open procedures on bones of lower leg, ankle, and foot; total ankle replacement.
Two-Midnight Rule for Procedures Removed from IPO List:
CMS is reversing the indefinite exemptions of the 2021 final rule and instead, for two years only following the removal of a procedure from the IPO list, will exempt the procedure from site-of-service claim denials, Beneficiary and Family-Centered Care Quality Improvement Organization (BFCC–QIO) referrals to Recovery Audit Contractor (RAC) for persistent noncompliance with the 2-midnight rule, and RAC reviews for ‘‘patient status’’ (that is, site-of-service).
Criteria for Adding Procedures to the ASC Covered Procedures List (CPL):
CMS is reinstating the ASC CPL criteria that were in effect for 2020. The agency is also adopting a nomination process under which stakeholders may nominate procedures they believe meet the ASC CPL criteria. CMS will provide guidance on the nomination process in early 2022, with procedure nominations due in March 2022, and the formal nomination process will begin in 2023.
Changes to the ASC CPL:
CMS proposed to remove 258 procedures that were added to the ASC CPL by the 2021 final rule, but decided in the 2022 final rule to remove 255 and keep three: (1) CPT 0499T, cystourethroscopy with mechanical dilation and urethral therapeutic drug delivery for urethral stricture or stenosis, including fluoroscopy, when performed. (2) CPT 54650, orchiopexy, abdominal approach, for intra-abdominal testis (e.g., fowler-stephens). (3) CPT 60512, parathyroid autotransplantation (list separately in addition to code for primary procedure). Note that TKA and THA continue to be on the ASC CPL.
Prior-Authorization Requirements in the Outpatient Setting: CMS did not take any action regarding prior authorization requirements.
Possible Future Inclusion of ASC Level, Risk-Standardized Patient-Reported Outcome-Based Performance Measure (PRO-PM) After Elective Primary THA and/or TKA:
CMS is not making any changes for 2022. The agency will continue to monitor the number of THA and TKA procedures in the ASC setting and when it believes there is a sufficient number of such procedures performed in ASCs to reliably measure a meaningful number of facilities, it may consider expanding the PRO–PM to the ASC setting.
HOPD-ASC Site-Neutral Payments
The Advocacy Committee continues to have discussions to develop policies for drafting legislation to require HOPD-ASC site-neutral payments. Recently, the Committee has begun the process of outreach to other stakeholders, including HOPDs, to determine whether there is any common ground on a policy of having a single conversion factor for ASCs and HOPDs. After considering responses from these other stakeholders, a decision will be made on the strategy going forward.
LeapFrog Group Recognizes Top ASCs
LeapFrog is a nonprofit organization that collects, analyzes, and publishes data on safety and quality in the health care industry. After considering all ASCs that participated in the 2021 Leapfrog Ambulatory Surgery Center Survey, the organization gave its “Top Ambulatory Surgical Center Award” to 13 ASCs. Of those, two were orthopaedic ASCs, both of which are OrthoForum members. They are Knoxville Orthopaedic Surgery Center (OrthoTennessee) and Reno Orthopedic Surgery Center (Reno Orthopedic Clinic).
ASC Subcommittee
For more information on ASC issues, or to join the OrthoForum Advocacy Committee ASC Subcommittee, please contact Teresa Copeland at: teresa.copeland@orthotennessee.com.
Political Update
There have been a number of consequential developments in Washington, DC, since our last update.
US Supreme Court
The biggest news is that Justice Stephen Breyer, age 83, is retiring from the Court, opening the door for President Biden to name a successor. Judge Ketanji Brown Jackson, age 51, who was confirmed in June 2021 to the U.S. Court of Appeals for the D.C. Circuit, is the early frontrunner to succeed Breyer. The DC Circuit, which hears many important cases challenging federal law, is something of a feeder for the Supreme Court. Chief Justice Roberts served on the DC Circuit, as did Justices Thomas and Kavanaugh. Breyer’s retirement is likely to go into effect at the end of the Court’s current term in June.
Legislation
On the legislative front, President Biden’s agenda has stalled in the equally divided U. S. Senate. Build Back Better is likely to shrink considerably (and be renamed) before the Senate votes on it. The Senate declined to change the filibuster rule, which has caused the Freedom to Vote: John R. Lewis Act, a voting rights bill, to stall. Some Republicans are advocating passage of The Electoral Count Act, a bill to clarify the vice president’s ministerial role in counting electoral votes. That bill might advance on its own, or it may include some provisions supported by members of both parties.
Federal Budget
The current continuing resolution to fund the government expires on February 1st. Congress is unlikely to pass a full- scale omnibus appropriations bill for fiscal year 2022 by that date. We understand that the president will give his State of the Union address on March 1st; an omnibus appropriations bill may follow soon after.
It’s just possible that the appropriations process for FY 2023 will proceed a bit more smoothly. This is the swan song for both the chairman of the Senate appropriations committee, Patrick Leahy, and the committee’s ranking member, Richard Shelby, both of whom are retiring. They are likely to press hard for regular order, and many of their colleagues will want to assist them.
Congressional Retirements
Finally, Justice Breyer’s retirement reflects pessimism among Democrats about the 2002 congressional midterm elections. In our last update, we described the so-called House casualty list as an augury of things to come. With the latest announcements, there are now 43 members of the House not running for re-election, 29 Democrats and 14 Republicans. We will continue to monitor this, as it is bound to affect OrthoForum’s lobbying plans.
