In a letter submitted to the Senate Finance Subcommittee on Health for a hearing Nov. 14, the AHA expressed support for the CONNECT Act (S.2016/H.R. 4189) and urged Congress to allow Medicare beneficiaries to access telehealth services wherever they and their providers are and allow rural health clinics, federally qualified health centers and critical access hospitals to serve as distance sites. AHA also encouraged Congress to: expand eligible telehealth providers to include occupational and physical therapists, speech-language pathologists and audiologists; no longer require beneficiaries to receive an in-person evaluation six months before and annually after initiating behavioral telehealth treatment; explicitly cover audio-only services; allow providers to use telehealth services to recertify hospice patients; and streamline licensure requirements for providers operating across state lines.
 
Testifying at the hearing were representatives from: the Northwest Regional Telehealth Resource Center; University of Alabama at Birmingham; University of Michigan; and Harvard Medical School.

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AHA on Oct. 10 voiced support for the CONNECT for Health Act (S. 2016/H.R. 4189), legislation that would increase patient access to telehealth services while removing barriers to adoption. The bill would permanently remove geographic restrictions that limit where patients can access telehealth, add homes and other clinically appropriate originating sites, and allow rural health clinics and federally qualified health centers to serve as distant sites. It also would remove requirements for an in-person evaluation six months before initiating behavioral telehealth treatment and an in-person visit annually thereafter.

AHA encouraged the legislation’s House and Senate sponsors to consider eliminating restrictions on originating sites altogether, and allowing critical access hospitals to offer and bill for telehealth services and serve as distant sites.

“Hospitals, health systems, providers and patients have seen the benefits and potential for telehealth to increase access and transform care delivery,” AHA wrote. “We appreciate your leadership on this important issue and look forward to working together to ensure passage of the CONNECT for Health Act of 2023.”

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America, and for that matter the world, is facing a growing challenge in caring for two expanding groups of patients — those 60 and older and patients with such chronic diseases as cancer, diabetes and obesity.

Across the globe, the 60-and-older population is increasing quickly and will surpass 2 billion by 2050, according to the World Health Organization. Meanwhile, caring for the 60% of U.S. adults who have at least one chronic disease accounts for $3.7 trillion in annual health care costs, states the Centers for Disease Control and Prevention.

The ability to monitor health and deliver care outside traditional medical settings could significantly reduce this expenditure, notes a recent CB Insights report. The analysis examines home care tech markets that providers should prioritize over the next three to five years.

We explore some technologies CB Insights analysts say providers should scrutinize over the next one to three years and what’s been happening in these sectors.

4 Home Care Technologies to Explore

1 | At-home Infusion

This technology enables patients to have intravenous treatments like dialysis at home. Wirelessly connected infusion pumps share data with providers to platforms that monitor treatment regimens. Providers are turning to these devices to support convenient, consumer-focused care. Investments in this tech sector are up significantly over the last two years, with mega funding rounds going to Somatus ($325 million), Quanta Dialysis Technology ($245 million) and Monogram Health ($160 million).

Key Takeaway

Providers should be selective before investing in this technology to ensure that comprehensive solutions support key considerations like ease of administration, infection monitoring and prevention, and tools to determine post-infusion status, the report states.

2 | Virtual Clinical Exam Rooms

Exam tools ranging from digital stethoscopes to comprehensive digital medical kits provide diagnostic-quality equipment to the home to support virtual visits. The virtual care equipment market was worth $3.5 billion in 2021, according to a Global Market Insights report and is estimated to grow at a compound annual growth rate of 17.3% through 2028.

Key Takeaway

Advanced exam tools, especially those with built-in artificial intelligence, will become a more prominent component to support remote diagnosis and treatment decisions.

3 | Digital Therapeutics

These solutions combine evidence-based research with digital technologies to provide treatment options for ongoing medical issues that can be addressed in the home. The technology provides apps and digital tools to support issues ranging from mental health to the management of diseases related to gastroenterology, endocrinology and cardiology. Digital therapeutics companies have received more than $1.1 billion in funding over the past five years and the sector is evolving quickly as Food and Drug Administration-approved, clinically validated therapies find their way to the market.

Key Takeaway

Monitor this sector to identify therapies that deliver benefits across multiple specialties and conditions. Evaluate the technology based on ease of use, whether the solutions provide easy-to-grasp content and meet the disparate needs of the populations you serve.

4 | Home Care Management Platforms

This technology supports the transition from an acute care setting to the home to help ensure effective care coordination. These platforms traditionally have focused on care for those with chronic conditions and the elderly, but newer solutions also focus on parents who are caring for infants. The technology ranges from supporting the scheduling of ongoing care to monitoring whether patients have been attending to existing care needs.

Key Takeaway

Evaluate these systems to ensure that investments will fit with your comprehensive growth strategy for managing multiple patient populations, including the elderly, patients with chronic diseases and acute care patients.

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Telehealth Access for America, an AHA-supported campaign to protect patient access to critical telehealth services, urged Congress to make permanent certain Medicare telehealth flexibilities granted during the COVID-19 public health emergency and extended through 2024 by the Consolidated Appropriations Act.

“This temporary extension was welcomed news for patients and providers alike, but remains just that – a temporary solution,” TAFA wrote. “According to a recent study, nearly three-in-four virtual care users want Congress to make current telehealth flexibilities permanent. The patients and organizations we represent need certainty that only Congress can provide. It is in the best interest of patients and providers nationwide that Congress make telehealth a permanent piece of the health care puzzle.”

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Jeff Lagasse, Associate Editor

The American Hospital Association has come out in support of bipartisan legislation, introduced in the House of Representatives, that would require the Department of Health and Human Services, Medicare Payment Advisory Commission, and Medicaid and CHIP Payment and Access Commission to study expanded telehealth use during the COVID-19 pandemic and recommend potential enhancements to telehealth access and quality.

In a letter to Republican Ohio Representative Troy Balderson, the AHA said it backed H.R. 1110, the Knowing the Efficiency and Efficacy of Permanent (KEEP) Telehealth Options Act.

The legislation mandates that HHS, MedPAC and MACPAC each conduct a report and issue recommendations on telehealth. These reports will include the expansion of telehealth services during the COVID-19 outbreak, the uptake of those services by patients across the country, and recommendations for enhancing the quality of and access to these services. 

The bill also asks each entity to make recommendations for potential improvement and expansion, as well as approaches to address and prevent fraudulent activity.

Last week, Balderson said this data is “crucial” for Congress to legislate a permanent expansion of telehealth.

“Telehealth is helping to better connect patients and providers by reducing the need for long-distance travel for routine in-person care and consultations,” said Balderson, who introduced the bill along with Representatives Susie Lee (D-NV), Ashley Hinsno (R-IA) and Joe Neguse (D-CO).

The AHA concurred.

“Telehealth has provided a critical way for patients to continue to access needed care, particularly during the COVID-19 pandemic,” the organization wrote in its letter. “We greatly appreciate the flexibilities implemented during the public health emergency and recently extended through 2024, as they will allow hospitals and health systems to continue to provide virtual care for patients.”

WHAT’S THE IMPACT

In order to help beneficiaries maintain access to care amid stay-at-home orders aimed at reducing COVID-19 related exposure, the Centers for Medicare and Medicaid Services used emergency waiver authorities enacted by Congress, as well as existing regulatory authorities, to implement policies expanding access to telehealth services during the pandemic.

These included waiving several statutory limitations, such as geographic restrictions, and allowing beneficiaries to receive telehealth in their home. 

The omnibus spending package that passed in December extended telehealth – and hospital-at-home programs – beyond the end of the public health emergency. The legislation extends waivers for both programs. Telehealth flexibilities are now in effect through the end of 2024.

Outside of the public health emergency, Medicare is generally restricted to payment for telehealth services in certain, mostly rural areas, and when beneficiaries leave the home and go to a clinic, hospital or other medical facility for the service.

In the physician fee schedule rule released in November, CMS announced that for the first time outside of the COVID-19 PHE that Medicare would pay for mental health visits furnished by Rural Health Clinics and Federally Qualified Health Centers via interactive video-based telehealth, including audio-only telephone calls.

THE LARGER TREND

In October 2022, after three months of relative stability, national telehealth utilization declined 3.7%. Looking at one specific metric, telehealth went from 5.4% of medical claim lines in September, to 5.2% in October, according to FAIR Health’s Monthly Telehealth Regional Tracker.

The decline in telehealth utilization was larger than the national average in the South (6.8%), Midwest (4.9%) and West (4.1 %), while there was an increase in utilization of 1.7% in the Northeast.

The data represents the privately insured population, including Medicare Advantage and excluding fee-for-service Medicare and Medicaid.

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Noah Schwartz – Friday, February 24th, 2023

The American Hospital Association is backing legislation that would require the HHS, Medicare Payment Advisory Commission, Medicaid and CHIP Payment and Access Commission to study the expanded use of telehealth during the COVID-19 pandemic.

The legislation, titled “Knowing the Efficiency and Efficacy of Permanent Telehealth Options Act,” is sponsored by a bipartisan group of representatives, according to a Feb. 23 AHA news release.

“Making the coverage of telehealth services permanent is critical for hospitals and health systems to deliver more convenient access and care to as many patients as possible while improving satisfaction and outcomes,” Lisa Kidder Hrobsky, AHA’s senior vice president of advocacy and political affairs said in the release.

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As the Congressional Telehealth Caucus considers updates to legislation that would permanently remove all geographic restrictions on Medicare telehealth services and expand originating sites, AHA encouraged House and Senate caucus leaders to consider adding provisions that have expanded access to care during the COVID-19 public health emergency. 

Specifically, AHA highlights support for provisions to permanently eliminate originating and geographic site restrictions and expand eligible provider types; repeal the in-person visit requirement for behavioral telehealth and distant site restrictions on Federally Qualified Health Centers and Rural Health Clinics; reimburse on a par with in-person visits; continue payment and coverage for audio-only services; remove unnecessary barriers to licensure; establish a Drug Enforcement Administration special registration process for administering controlled substances via telemedicine; and expand cross-agency collaboration on digital infrastructure and literacy initiatives.

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Update: President Joe Biden signed the bill into law on Dec. 29, 2022. 

Update: The bill passed both chambers of Congress and was sent to President Joe Biden as of Dec. 23, 2022. 

The year-end $1.7 trillion spending bill includes provisions to extend pandemic-era telehealth and hospital-at-home waivers for two years.

The legislation, released Tuesday, aims to avert a government shutdown and includes several healthcare provisions, including reducing the 2023 Medicare payment cuts to 2 percent from 4.5 percent.

In a win for telehealth proponents, the sweeping bill also includes a two-year extension of telehealth-related regulatory flexibilities for Medicare beneficiaries put in place during the COVID-19 pandemic. A previous bill extended these flexibilities for five months after the public health emergency expires.

Now, the waivers will remain in place through Dec. 31, 2024, if the legislation passes both the House and Senate and is enacted into law.

The flexibilities include eliminating geographic restrictions on originating sites for telehealth services, enabling Medicare beneficiaries to receive services from any location, and allowing federally qualified health centers and rural health centers to continue providing telehealth services.

Further, the waivers lift the initial in-person care requirements for those receiving mental healthcare through telehealth and allow for continued coverage of audio-only telehealth services.

In addition to extending the Medicare telehealth waivers, the new legislation includes a two-year extension of the Acute Hospital Care at Home Program. Introduced in November 2020 by the Centers for Medicare and Medicaid Services, the Acute Hospital Care at Home Program allows treatment for common acute conditions in home settings. As of Dec. 16, 259 hospitals across 37 states were participating in the program.

The safe harbor for telehealth coverage for those with high deductible health plans (HDHPs) with health savings accounts (HSAs) will also be extended by two years if the new bill passes. The safe harbor provision enables people with HDHP-HSAs to receive telehealth coverage without meeting their annual deductible first.

“Today, our Congressional telehealth champions on both sides of the aisle came through for the American people and for ATA and ATA Action members, by meeting our plea for more certainty around telehealth access for the next two years, while we continue to work with policymakers to make telehealth access a permanent part of our healthcare delivery for the future,” said Kyle Zebley, senior vice president of public policy at American Telemedicine Association and executive director of the association’s advocacy arm, ATA Action, in an emailed press release.

But the new legislation does not include a similar two-year extension for the waiver of the Ryan Haight Act.

The Ryan Haight Act of 2008 required providers to meet with a patient in person before being allowed to prescribe controlled substances for that person via telehealth. The in-person visit requirement was temporarily lifted during the COVID-19 pandemic.

Since then, several stakeholders, including the American Telemedicine Association and American Psychiatric Association, have asked that Congress permanently eliminate the Ryan Haight Act.

The latest spending bill does, however, direct the Drug Enforcement Administration (DEA) to create final regulations regarding the circumstances under which a special registration for telemedicine may be issued. Providers obtaining a special registration for telemedicine would be allowed to waive the in-person visit requirement.

Earlier this month, the American Hospital Association had also asked that the DEA clarify regulations for the special registration process and provide recommendations for an interim plan.

“…the hard work continues, as we persist in pressing telehealth permanency and creating a lasting roadblock to the ‘telehealth cliff,'” said Zebley. “Additionally, we will continue to work with Congress and the Biden administration to make sure that a predictable and preventable public health crisis never occurs by giving needed certainty to the huge number of Americans relying on the clinically appropriate care achieved through the Ryan Haight in-person waiver.”

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The House and Senate  Appropriations Committees last night released the fiscal year 2023 Omnibus Appropriations legislation that would fund the government through Sept. 30, 2023. The bipartisan bill includes various provisions beneficial to hospitals and health systems.  
 
The legislation would:  

• Prevent the 4% Statutory Pay-As-You-Go (PAYGO) sequester for two years; 
• Extend for two years critical rural Medicare programs, telehealth flexibilities and the Acute Hospital Care at Home; 
• Reduce the physician fee schedule cut from 4.5% to 2% for 2023 and approximately 3% for 2024; 
• Provide 200 additional Medicare-funded graduate medical education positions, half of which would be dedicated to psychiatry and psychiatry subspecialty residencies; 
• Take several steps to improve access to behavioral health services; 
• Make improvements to the government’s ability to prepare for future emergencies. 

 
In a statement released today, AHA President and CEO Rick Pollack said, “The AHA is pleased that on a bipartisan basis Congress recognizes the immense pressure America’s hospitals, health systems and our caregivers are facing. This legislation will deliver critical support and resources so we can better care for our patients and create healthier communities. Due to skyrocketing cost increases for supplies, equipment, drugs and labor, challenging workforce shortages, and the ‘tripledemic’ of COVID-19, flu, and RSV, the hospital field is stretched thin and on the brink.  
 
“Specifically, we are pleased that this bill prevents significant four percent Medicare PAYGO cuts to providers, extends two key programs for two years that help rural hospitals keep their doors open, and extends for two years critical waivers for telehealth and hospital-at-home programs that have led to improvements in care and made medical treatment more convenient and accessible for patients. Additionally, we appreciate Congress giving partial relief to physicians by rolling back Medicare payment cuts and including important provisions to improve the nation’s preparedness for the next pandemic, train the next generation of caregivers, bolster behavioral health care providers and expand access to behavioral health services. Finally, helping states prepare for changes in Medicaid eligibility due to the end of the Public Health Emergency could help them transition those individuals to other forms of health coverage. 
 
“However, this is just a part of what needs to be done to support those on the front lines caring for patients. In the new year, we will continue to advocate for Congress and the Administration to take action to address patient discharge backlogs, support our current workforce and increase the pipeline into the future, hold commercial health insurers accountable for policies that compromise patient safety and add burden to care providers, and strengthen hospitals that care for a disproportionate number of patients covered by government programs or are uninsured, to name a few of our priorities.”  
 
The Senate is expected to begin debate on the measure today and to pass the spending bill first. The House is likely to vote by Friday. The president is expected to sign the bill into law before current funding for the government expires at 11:59 p.m. ET on Dec. 23.

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The Centers for Medicare & Medicaid Services (CMS) Nov. 1 issued a final rule that updates the physician fee schedule (PFS) for calendar year (CY) 2023. The rule also includes changes related to the Medicare Shared Savings Program and the Quality Payment Program (QPP), both of which were created by the Medicare Access and CHIP Reauthorization Act (MACRA) of 2015.

Key Highlights

The final rule:

• Reduces the PFS conversion factor to $33.06 in CY 2023, as compared to $34.61 in CY 2022, which reflects: the expiration of the temporary 3% statutory payment increase; a 0.0% conversion factor update, as required by law; and a budget-neutrality adjustment.
• Updates the Medicare Economic Index weights for CY 2023, although the revised weights were not used in CY 2023 ratesetting.
• Delays for one year (until Jan. 1, 2024) CMS’ implementation of its policy to define the substantive portion of a split (or shared) visit based on the amount of time spent by the billing practitioner.
• Adds several temporary telehealth codes to be available until the end of 2023 on a Category 3 basis, extends certain telehealth flexibilities through 151 days after the COVID-19 PHE expires in accordance with the Consolidated Appropriations Act and updates the originating site fee.
• Provides advance shared savings payments to “low-revenue” Accountable Care Organizations (ACOs) that are both new to the MSSP and serve underserved populations and increases flexibility for these ACOs to share in savings.
• Provides ACOs a more gradual glide path to two-sided risk.
• Modifies the ACO benchmarking methodology to help ensure that ACOs do not have to compete against their own best performance.
• Modifies Medicare Shared Savings Program (MSSP) quality scoring by adopting a sliding scale for shared-savings eligibility and adding a new health equity adjustment.
• Adds five new Merit-Based Incentive Payment System Value Pathways (MVPs) for CY 2023.
• Increases the quality data completeness threshold to 75% and revises Promoting Interoperability objectives and measures.

AHA Take

The AHA is concerned with CMS’ payment update, which reduces CY 2023 payments from their CY 2022 levels by almost 4.5%, and, as a result, may have a negative impact on patients’ access to certain services. Our concern is heightened by the fact that this cut is coming in the wake of nearly two years of unrelenting financial pressures on the health care system due to the ongoing COVID-19 public health emergency (PHE), increased inflation, rising staffing costs and increased costs for non-labor supply categories due to national shortages. However, we are pleased that CMS is delaying implementation of its split/shared visit policy, which would have resulted in a significant reduction in physician revenue on top of this proposed rule’s other cuts.

Additionally, while the rule does add many telehealth services for continued coverage through 2023 and extends certain additional flexibilities for 151 days after the COVID-19 PHE ends, we are concerned about the “telehealth cliff” that will result after the PHE expires, potentially creating reductions in access and services. The AHA continues to encourage CMS to work with Congress on permanent adoption of waiver provisions such as eliminating the originating and geographic site restrictions for all telehealth services and expanding telehealth eligibility to certain practitioners.

We are encouraged by the modifications made in the CY 2023 final rule on the MSSP and Quality Payment Programs, which reflect many priorities on which we have worked with the agency. For MSSP for example, the final rule modifies the manner in which ACOs’ benchmarks are calculated to help sustain long-term participation and reduce costs. It also provides increased flexibility for certain smaller ACOs to share in savings. We continue to encourage CMS to adopt policies that support flexible implementation and widespread adoption of value-based and alternative payment models.

Highlights of the PFS rule follow:

CY 2023 Proposed Payment Update

CMS will reduce the conversion factor to $33.06 in CY 2023, as compared to $34.61 in CY 2022 (a 4.48% decrease). This update reflects several different factors: the expiration of a temporary 3% increase in the PFS conversion factor, which was provided by the Protecting Medicare and American Farmers From Sequester Cuts Act for CY 2022 only; a 0% update factor as required by MACRA; and a budget-neutrality adjustment.

Updated Medicare Economic Index (MEI) for CY 2023

The agency finalized rebasing of the MEI, incorporating recommendations received based on public comment. Under the agency’s revised methodology, the portion of the MEI accounted for by practice expense increased, while the portions accounted for by physician work and malpractice decreased. The agency anticipates that these revised weights will not impact overall spending for PFS services, but will impact distribution of payments based on geography and specialty. Therefore, the revised MEI weights were not used in CY 2023 ratesetting. The updated MEI for CY 2023 is 3.8% based on data available.

Changes to Payment for Medicare Telehealth Services

In the CY 2021 PFS final rule, CMS created a new category — Category 3 — for adding services on a temporary basis to Medicare’s approved list of telehealth services. Coverage and payment for Category 3 services will be retained until the end of CY 2023. In this year’s rule, CMS adds 59 additional services to Category 3, in order to continue to collect data and evaluate whether these codes would warrant adoption on a permanent basis.

Regarding services that are temporarily included on the telehealth list during the COVID-19 PHE, but not on a Category 1, 2 or 3 basis, CMS will maintain these services on the list for 151 days following the end of the PHE, as required by the Consolidated Appropriations Act, 2022 (CAA, 2022). Notably, CMS decided audio-only telephone evaluation and management coverage outside of behavioral health will not be extended until the end of 2023. The final rule also reiterated that two-way, audio-video communications technology will continue to be the appropriate standard of care that will apply for Medicare telehealth services after the COVID-19 PHE and the 151-day extension period.

Also as required under the CAA, 2022, CMS extends certain additional flexibilities for 151 days after the COVID-19 PHE ends, including waiving the geographic and originating site restrictions; allowing certain services to be furnished via audio-only telecommunications systems; and allowing payment for Rural Health Clinics and Federally Qualified Health Centers for furnishing telehealth services (other than mental health visits that can be furnished virtually on a permanent basis). The CAA, 2022 also delays the in-person visit requirements for mental health services furnished via telehealth until 152 days after the end of the PHE.

Additionally, the originating site fee was updated from $27.59 to $28.64 for CY 2023. This reflects the 3.8% MEI increase for CY 2023.

Payment for Evaluation and Management (E/M) Visits

A “split” or “shared” E/M visit is one that is performed by both a physician and a non-physician practitioner (NPP) in the same group. Because Medicare provides higher PFS payment for services furnished by physicians than those furnished by NPPs, CMS has addressed when physicians can bill for split visits. Specifically, physicians in a facility setting may bill for an E/M visit when both the billing physician and an NPP in the same group each perform portions of the visit, but only if the physician performs a “substantive” portion of the visit. If the physician does not perform a substantive part of the split visit and the NPP bills for it, Medicare will pay only 85% of the fee schedule rate.

In last year’s rulemaking, CMS finalized a policy under which the agency would define the “substantive” portion of the visit as more than half of the total time spent. This was scheduled to take effect in CY 2023. However, CMS in the CY 2023 final rule delays implementation of this policy for one year, until Jan. 1, 2024. Thus, for CY 2023, the substantive portion continues to be defined as either one of the three key components of a visit (history, physical exam or medical decision-making), or more than half of the total time.

Requiring Manufacturers of Certain Single-dose Container or Single-dose Package Drugs to Provide Refunds with Respect to Discarded Amounts

The Infrastructure Investment and Jobs Act requires manufacturers to provide a refund to CMS for certain discarded amounts from a single-dose container or single-use package drug. The refund amount is the amount of discarded drug that exceeds an applicable percentage, which is required to be at least 10% of total charges for the drug in a calendar quarter. A refundable single-dose container or single-use package drug does not include to following: radiopharmaceutical or imaging agents; certain drugs requiring filtration; and certain new drugs.

To implement this requirement, CMS is finalizing policies including: how providers will determine the amount of discarded drugs; how they will record these amounts on the bill; and a definition of which drugs are subject to refunds. This includes a policy that hospital outpatient departments (HOPDs) and ambulatory surgery centers (ASCs) be required to report the JW modifier, or any successor modifier, to identify discarded amounts of refundable single-dose container or single-use package drugs that are separately payable under the OPPS (described by HCPCS codes assigned status indicator “K” or “G”) or ASC payment system (described by HCPCS codes assigned payment indicator “K2”).

Specifically, CMS finalizes a policy that, starting Jan. 1, 2023, for the purpose of calculating the refund amount during a relevant quarter, the JW modifier be used to determine the total number of billing units of the Health Care Common Procedure Coding System (HCPCS) code of a refundable single-dose container or single-use package drug that were discarded. Further, beginning no later than July 1, 2023, CMS also will require HOPDs and ASCs to use a separate modifier, JZ, in cases where no billing units of such drugs were discarded and for which the JW modifier would be required if there were discarded amounts. The agency will begin claims edits for both the JW and JZ modifier beginning Oct. 1, 2023.

Medicare Shared Savings Program (MSSP)

CMS adopted numerous policy changes to the Medicare Shared Savings Program, many of which the AHA has advocated for. The modifications in the final rule intend to support improved equity and expanded access for underserved populations.

Modifications for Smaller ACOs. In the final rule, CMS added a new option in the MSSP to make advanced shared savings payments to support certain ACOs in covering upfront infrastructure investments. ACOs eligible for these payments are those that are a) new to the MSSP and b) identified as being low-revenue and inexperienced with ACO performance-based risk. They may receive a one-time fixed payment of $250,000, as well as quarterly payments for the first two years of the five-year agreement period. The advance investment payments would be recouped once the ACO begins to achieve shared savings, if the ACO doesn’t achieve shared savings then funding will not be recouped (unless the ACO terminates during the agreement period in which advance investment payments were made). ACOs must use these payments to improve health care provider infrastructure, increase staffing, or provide accountable care for underserved beneficiaries, which may include addressing social needs. The initial application cycle to apply for advance investment payments will occur during CY 2023 for a Jan. 1, 2024, start date.

In addition, beginning on Jan. 1, 2024, CMS will provide more flexibility in how certain ACOs can qualify for shared savings, including allowing certain low-revenue ACOs in the BASIC track to share in savings, even if the ACO does not meet the minimum savings rate (MSR) requirement. That is, eligible ACOs that meet the quality performance standard required to share in savings at the maximum sharing rate, but not the MSR itself, would receive half of the maximum sharing rate for their level of participation.

Transition to Performance-based Risk. In response to feedback from AHA and other stakeholders that the MSSP requires too much risk too soon, CMS adopted proposals to provide more gradual transitions for certain ACOs. For example, for agreement periods beginning on Jan. 1, 2024, the final rule enables ACOs inexperienced with performance-based risk to participate in the lowest risk level (BASIC Track, Level A), for all five years of the agreement period. These ACOs may be eligible for a second agreement period within the BASIC track’s glide path, with two additional years under one-sided models (Levels A and B), for a total of seven years before transitioning on to two-sided risk (Levels C, D and E). For performance years beginning Jan. 1, 2023, and Jan. 1, 2024, the agency would allow ACOs currently participating in Levels A or B to elect to remain there for the remainder of their agreement.

Lastly, for agreement periods beginning on Jan. 1, 2024, and after, CMS will allow an ACO to remain in Level E of the BASIC track indefinitely; participation in the ENHANCED track will be optional.

Modifications to ACO Benchmarks. CMS makes numerous changes designed to improve the calculation of ACO benchmarks so as to encourage participation in the program, including by helping to ensure that an ACO does not have to compete against its own best performance. For example, the agency:

• Adopted its proposal to use a prospectively projected administrative growth factor, a variant of the United States Per Capita Cost (USPCC) referred to as the Accountable Care Prospective Trend (ACPT), in addition to national and regional growth rates when updating benchmarks. The agency believes that this three-way blended growth factor will help insulate the benchmarks from savings achieved under the MSSP. Additionally the ACPT growth factors will be set for the ACO’s entire agreement period, providing some level of stability.
• Adopted its proposal to incorporate an adjustment for prior savings into the benchmark for returning/renewing ACOs. CMS believes that returning dollar value to benchmarks through a prior-savings adjustment will help address the ratcheting effect whereby ACOs must continually beat their own performance and will incentive high performing ACOs to remain in the program.
• Modifies the cap on risk-score increases so that they can increase by more than 3% from the base year to any performance year, which is the current standard.

The agency also adopted certain benchmarking policies to mitigate the impact of regional adjustments and support participation by organizations serving medically complex high-cost beneficiaries.

Quality Performance Standard. Current MSSP policy requires ACOs to meet a minimum “quality performance standard” in order to be eligible for shared savings or avoid owing maximum losses. That standard is the 30th percentile of MIPS quality scores for CY 2023, and the 40th percentile for CY 2024 and beyond. Beginning with the 2023 performance year, ACOs scoring below the minimum quality performance standard will be eligible for shared savings (or owe shared losses) at a lower rate if they score at the 10th percentile or above on at least one of the four APM Performance Pathway (APP) outcomes measures used in the MSSP. The lower rates of shared savings/losses will be calculated on a sliding scale tied to the ACO’s quality performance score. CMS states that the intent of the modified policy is to avoid a “cliff” in which small differences in quality score could eliminate any possibility of shared savings, or lead to owing shared losses.

CMS also finalizes its proposal to retain through performance year 2024 its incentive for ACOs to report the APP measure set. ACOs that opt to report the APP measure set will meet the minimum quality performance standard if they achieve both:

• A score of at least the 10th percentile on at least one of the four APP outcome measures; and
• A score at or above the 40th percentile on least one of the other five APP measures.

Health Equity Adjustment. Beginning in CY 2023, CMS will add up to 10 bonus points to an ACO’s quality performance score based on a combination of their quality performance and the extent to which they care for underserved patients. The bonus will be available to only those ACOs that opt to report the six measures in the APP measure set. The equity adjustment will be the product of two factors — a “measure performance scaler” and “an underserved multiplier.” The measure performance scaler is unchanged from the proposed rule, and will assign ACOs points on each APP measure based on whether they score in the top, middle or bottom third of performance on the measure. However, CMS adopts a modification to the underserved multiplier by including assigned beneficiaries that receive the Medicare Part D Low Income Subsidy (LIS). As a result, the underserved multiplier will be the higher of the ACO’s Area Deprivation Index (ADI) score or its proportion of beneficiaries who are dually eligible for Medicare and Medicaid or receive the Part D LIS.

Behavioral Health

Currently, payment for services of licensed professional counselors and licensed marriage and family therapists can only be made under the PFS indirectly (i.e. when delivered incident to the services and under direct supervision of—as opposed to independent of—the billing physician or other practitioner). CMS finalized its proposal to amend the direct supervision requirement to allow behavioral health services to be furnished under the general supervision of a physician or NPP when the services are provided by auxiliary personnel incident to the services of a physician or NPP.

In addition, CMS establishes a new code as part of the existing set of codes describing services furnished using the Psychiatric Collaborative Care Model. This code accounts for monthly care integration where the mental health services furnished by a clinical psychologist or clinical social worker (as opposed to a physician) serve as the “focal point” of care integration and would be allowed under general supervision.

Opioid Treatment Programs (OTPs)

Due to the unreliable nature of voluntary reporting of average sales price (ASP) data for various forms of methadone, CMS believes that the ASP data cannot provide an appropriate reflection of methadone costs for OTPs, and thus will use a different method of updating the payment rate for the drug component of the methadone weekly bundle and add-on code for take-home supplies of methadone. Under this provision, CMS will use the payment amount used in CY 2021 (rather than more recent pricing data, which would result in a decrease in payments) and update the amount annually to account for inflation.

CMS will also update the rate for individual therapy (the non-drug component) of the bundled payment. This rate is currently based on a crosswalk to a code that describes 30 minutes of psychotherapy, but stakeholder feedback leads CMS to believe that the severity of needs of the patient population diagnosed with OUD and receiving services in the OTP setting is generally greater than that of patients receiving 30-minute psychotherapy services paid under the PFS. Thus, the agency will instead crosswalk to a code (CPT code 90834) describing 45 minutes of psychotherapy.

Finally, CMS finalized its proposal to allow the OTP intake add-on code to be furnished via two-way audio-video communications technology for the initiation of treatment with buprenorphine under certain circumstances. In addition, CMS will allow periodic assessments to continue to be furnished using audio-only communication technology through the end of CY 2023.

Requirements for Electronic Prescribing for Controlled Substances (ECPS)

Section 2003 of the SUPPORT Act requires prescribers to use ECPS for a Part D drug covered under a prescription drug plan or a Medicare Advantage prescription drug plan. In the CY 2020 PFS final rule, CMS stated that it would begin initial EPCS compliance actions beginning in CY 2023. CMS notes that it will use Prescription Drug Event data from the year in which compliance is being evaluated as soon as that data become available; hence, it will evaluate compliance in CY 2023 when it gets 2023 data in 2024. CMS will extend the non-compliance action of sending letters to non-compliance prescribers through 2024.

Quality Payment Program (QPP)

As mandated by MACRA, the QPP includes two tracks — the default Merit-Based Incentive Payment System (MIPS) and advanced alternative payment models (APMs). The rule proposes updates to what eligible clinicians must report during the QPP’s 2023 performance period and beyond. There is a lag of two years between the QPP’s performance period and the payment year; for example, CY 2023 performance will affect PFS payments in CY 2025. As required by MACRA, eligible clinicians will receive positive or negative payment adjustments of up to 9% in CY 2025 based on CY 2023 performance.

Key MIPS policy changes include the following:

• MIPS Value Pathways (MVPs). In prior rulemaking, CMS adopted a framework for MVPs that the agency intends as a long-term replacement for the current MIPS. MVPs organize the reporting requirements for each MIPS category around specific medical conditions, clinical specialties or episodes of care. In this rule, CMS adopts five additional MVPs that would be available for the CY 2023 performance period: cancer care, kidney health, episodic neurological conditions, neurodegenerative conditions and promoting wellness. CMS also finalizes modifications to its processes for establishing and scoring MVP “subgroups” within larger physician practices.
• Quality Category. CMS will increase the quality measure data completeness threshold from 70% to 75%, starting with the CY 2024 performance period. In addition, CMS finalizes its proposal to update its definition of high priority measures to include health equity measures, and adds a new health-related social needs screening measure that would be available beginning with the CY 2023 reporting period.
• Promoting Interoperability. Current MIPS policy requires individual clinicians and groups that are part of APM entities to report the Promoting Interoperability category at the individual or group level rather than the APM entity level. However, beginning with CY 2023 reporting, CMS will permit Promoting Interoperability reporting at the APM entity level. In addition, CMS finalizes several changes to the category’s objectives and measures for CY 2023 that align with recently adopted changes to the hospital Promoting Interoperability Program. These include modifying the levels of active engagement for the Public Health and Clinical Data Exchange objectives, requiring the reporting of the Query of Prescription Drug Monitoring Program (PDMP) measure, and adding participation in the Trusted Exchange Framework and Common Agreement (TEFCA) to the list of options for satisfying the Health Information Exchange objective.

From an advanced APM perspective, the final rule adopts several policies for which we have advocated, including permanently establishing the 8% minimum General Applicable Nominal Risk standard for advanced APMs.

The final rule also formalizes the proposal to apply the 50 eligible clinician limit for Medical Home Models to the APM Entity participating (as defined by Taxpayer Identification Numbers/National Provider Identifiers on the APM entity’s participation list). Per the MACRA statute, certain medical homes can qualify as advanced APMs. Specifically, CMS adopted relaxed financial risk standards for medical homes to qualify as advanced APMs, but limited availability to APM entities owned and operated by organizations with 50 or fewer clinicians.

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