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Final CY 2024 Medicare Physician Fee Schedule Extends Many Telehealth Flexibilities Through 2024

Changes to the Medicare Telehealth Services List Structure and Updates Process

Prior to the COVID-19 public health emergency (PHE), the Centers for Medicare & Medicaid Services (CMS) evaluated changes to the Medicare Telehealth Services List (the List) through an annual rulemaking process. Through this process, CMS considered whether a service met one of two criteria for permanent inclusion on the List. Category 1 services are similar to professional consultations, office visits and office psychiatry services that are currently on the List. Category 2 services are not similar to those on the List—the primary criteria CMS uses in evaluating these services are (a) whether the service is accurately described by the corresponding code when delivered via telehealth and (b) whether the use of a telecommunications system to deliver the service produces demonstrated clinical benefit to the patient. During the PHE, CMS created a third category (Category 3), which allows for temporary coverage while further evidence is developed and the service is considered for permanent (Category 1 or 2) coverage.

The current List structure and updates process have proved cumbersome and confusing to stakeholders, and so CMS finalized simplifying the List into two categories—permanent and provisional—beginning in calendar year (CY) 2024. CMS also finalized the following steps for analyzing changes to the List for the CY 2025 physician fee schedule (PFS) proposed rule:

Step 1: Determine whether the service is separately payable under the PFS.
Step 2: Determine whether the service is subject to the provisions of Section 1834(m) of the Social Security Act—in effect, whether at least some elements of the service, when delivered via telehealth, are a substitute for an in-person, face-to-face encounter and all of those face-to-face elements of the service are furnished using an interactive telecommunications system.
Step 3: Review the elements of the service as described by the HCPCS code, and determine whether each of them is capable of being furnished using an interactive telecommunications system.
Step 4: Consider whether the service elements of the requested service map to the service elements of a service on the List that has a permanent status described in previous final rulemaking.
Step 5: Consider whether there is evidence of clinical benefit analogous to the clinical benefit of the in-person service when the patient who is located at a telehealth originating site receives a service furnished by a physician or practitioner located at a distant site using an interactive telecommunications system.

For 2024, CMS finalized its proposal to redesignate Category 1 and Category 2 codes to the new permanent category, and “temporary Category 2” and Category 3 codes to the new provisional category. CMS did not finalize any specific timeline for considering changes from provisional to permanent status—changes in status will be evaluated during the annual updates process.

Additions to the Medicare Telehealth Services List

Each year, CMS reviews requests for changes to the List. This year, CMS is finalizing as proposed a rule to add a series of health and well-being coaching services to the List on a temporary basis for CY 2024. In addition, CMS is finalizing as proposed a rule to add HCPCS code G0136, Administration of a standardized, evidence-based Social Determinants of Health Risk Assessment tool, 5-15 minutes, to the List on a permanent basis beginning in CY 2024. There were several other requests for additions to the List on a permanent basis, all of which were rejected by CMS in the final rule because they did not meet CMS’ current criteria, described above.

Implementing the Consolidated Appropriations Act (CAA), 2023, Telehealth Provisions

Section 4113 of the CAA, 2023, further extended PHE-related telehealth policies and required CMS to extend PHE-related telehealth flexibilities through December 31, 2024. CMS finalized its proposal to implement several provisions of the CAA, 2023, which would extend the following policies through CY 2024 on a temporary basis:

In-Person Requirements for Mental Health Services: Delaying the in-person visit requirement for telemental health services furnished by rural health clinics (RHCs) and federally qualified health centers (FQHCs)
Originating Site and Geographic Restrictions: Expanding the scope of telehealth originating sites for services furnished via telehealth to include any site in the United States where the beneficiary is located at the time of the telehealth service, including an individual’s home
Eligible Providers: Expanding the definition of telehealth practitioners to include qualified occupational therapists, qualified physical therapists, qualified speech-language pathologists and qualified audiologists (and adding marriage and family therapists (MFTs) and mental health counselors (MHCs) to the list of eligible providers)
Audio-Only: Continuing coverage of certain audio-only telehealth services on the List

In addition, CMS finalized extending the following telehealth flexibilities through CY 2024:

Frequency Limits: Removing frequency limitations for certain subsequent inpatient visits, subsequent nursing facility visits and critical care consultation services
Direct Supervision of Clinical Staff: Continuing to allow for “direct supervision” to permit the presence and “immediate availability” of the supervising practitioner through real-time audio and visual interactive telecommunications (pre-PHE “direct supervision” could only be met via in-person “immediate availability”) (CMS sought comment on whether to extend the flexibilities related to direct supervision and virtual presence of teaching physicians beyond CY 2024 and will consider addressing this topic in possible future rulemaking)
Telehealth in Teaching Settings: Continuing to allow teaching physicians to have a virtual presence in all teaching settings, but only in clinical instances when the service is furnished virtually (for example, a three-way telehealth visit with all parties in separate locations)
Outpatient Therapy, Diabetes Self-Management Training and Medical Nutrition Therapy: Continuing to allow outpatient therapy (physical therapy, occupational therapy, speech-language pathology), diabetes self-management training and medical nutrition therapy to be provided via telehealth when delivered by institutional staff
Telehealth for Opioid Treatment Providers: Allowing periodic assessments to be furnished via audio-only communications technology when video is not available, to the extent that use of audio-only communications technology is permitted under the applicable Substance Abuse and Mental Health Services Administration (SAMHSA) and Drug Enforcement Administration (DEA) requirements at the time the service is furnished and provided that all other applicable requirements are met
Practitioner Home Address Reporting: In response to provider safety concerns expressed by public commenters regarding the expiration of provider enrollment requirement flexibilities for distant site telehealth practitioners, CMS extended the flexibility to use the practitioner’s currently enrolled location instead of their home address when providing services from their home through CY 2024 and will consider the issue further for future rulemaking.

Changes to Payment by Place of Service for Medicare Telehealth Services

When a physician or practitioner submits a claim for their professional services, including claims for telehealth services, they include a place of service (POS) code that is used to determine whether a service is paid using the facility or non-facility rate. Under the PFS, there are two payment rates for many physicians’ services: the facility rate, which applies when the service is furnished in a hospital or skilled nursing facility setting, and the non-facility rate, which applies when the service is furnished in an office or other setting. The facility rate is typically lower than the non-facility rate, but there is a separate payment to the facility (sometimes called a facility fee), in addition to the payment to the physician, to pay for facility costs (clinical staff, supplies, equipment, overhead).

CMS has evolved its guidance on the use of modifiers and POS codes for telehealth services over the past several years and during the PHE. Starting in CY 2023, CMS required that telehealth claims be billed with one of two POS indicators:

POS “02”—Telehealth Provided Other Than in Patient’s Home
POS “10”—Telehealth Provided in Patient’s Home

Beginning in CY 2024, CMS finalized that claims billed with POS 02 be paid at the facility rate and claims billed with POS 10 be paid at the non-facility rate. CMS explains that during the PHE, especially for behavioral health services, practice patterns evolved such that providers often see patients both in person and virtually. As a result, these practitioners continue to maintain their office presence even as a significant proportion of their practice’s utilization may be comprised of telehealth visits. As such, CMS concludes, the practice expenses for these services are more accurately reflected by the non-facility rate. Claims billed with POS 02 will be paid at the facility rate under the logic that those services will be furnished in originating sites that were typical prior to the PHE and the facility rate more accurately reflects the practice expenses of these telehealth services.

CMS noted that it will allow outpatient hospitals and other providers of physical therapy; occupational therapy; and speech-language pathology, diabetic self-management (DSMT) and medical nutrition therapy (MNT) services that remain on the Medicare Telehealth Services List for CY 2024 to bill for these services when furnished remotely in the same way they have been during the COVID-19 PHE and through the end of CY 2023, including that for hospitals, beneficiaries’ homes will no longer need to be registered as provider-based departments of the hospital to allow for hospitals to bill for these services.

In addition, CMS clarified that modifier “95” should be used when the clinician is in the hospital and the patient is in the home, as well as for outpatient therapy services furnished via telehealth by physical therapists, occupational therapists or speech-language pathologists.

Remote Physiologic and Therapeutic Monitoring

Currently, remote physiologic monitoring (RPM) and remote therapeutic monitoring (RTM) codes are not stand-alone billable visits in RHCs and FQHCs. When these services are furnished incident to an RHC or FQHC visit, payment is included in the RHC’s all-inclusive rate (AIR) subject to a payment limit or per-visit payment under the FQHC prospective payment system (PPS), which is the lesser of the PPS rate or the FQHC’s actual charges. CMS finalized that starting in CY 2024, RPM and RTM services will be separately payable to RHCs and FQHCs using the general care management code, HCPCS code G0511.

In addition, CMS finalized that RTM services are allowed to be furnished under general rather than direct supervision when provided by occupational therapists (OTs) or physical therapists (PTs) in private practice. Previously, these services, when provided by an occupational or physical therapy assistant, were subject to direct supervision, which required the PT or OT to be “immediately available.” CMS sought comment on whether to allow for general supervision for a broader set of services provided by OTs and PTs and will take these comments into consideration for possible future rulemaking.

Finally, CMS confirmed and clarified the following policies related to RPM and RTM:

RPM and RTM services can only be furnished to an established patient. Patients who received initial remote monitoring services during the PHE are considered established patients for purposes of the new patient requirements that are now effective after the last day of the COVID-19 PHE.
16 days of data are required within a given 30-day period for the relevant RPM and RTM codes. In response to public comments, CMS clarified that CPT codes 99457, 99458, 98980 and 98981 are exempt from this requirement, as they are treatment management codes that account for time spent in a calendar month and do not require 16 days of data collection in a 30-day period.
RPM and RTM cannot both be billed for the same patient in the same month, though either RPM or RTM can generally be billed with other care management services as long as time or effort is not double-counted.
RPM or RTM (but not both) can be furnished separately from services covered under payment for a global period as long as time and effort requirements are met.

Request for Information on Digital Therapies

CMS has, over time, expanded coverage for a range of digital therapies, including RPM and RTM. CMS sought information on how remote monitoring services are used in clinical practice and experience with coding and payment policies for these codes, with a focus on digital cognitive behavioral therapy (CBT).

In prior guidance, CMS indicated that digital therapeutics did not have a statutorily defined Medicare benefit category (except for certain digital therapeutics with a hardware component that met the definition of durable medical equipment (DME)), so it is notable that CMS sought comment on how it should view digital therapeutics vis-à-vis benefit category determinations.

In response to public commenters who stated that CMS has existing authority to pay for two types of digital therapeutics—those that meet the definitions of DME and those that are used incident to a physician service—CMS declined to make any changes to coverage but noted that it looks forward to reviewing forthcoming potential code recommendations from the CPT Editorial Panel meeting as part of its standard annual processes and future rulemaking.