2023 Medicare Final Rules: Long-Awaited, Highly Anticipated

The final rules become effective Jan. 1, 2023.

Amid this election season, the Centers for Medicare & Medicaid Services (CMS) has published final rules for the 2023 Part B Physician Fee Schedule and Medicare Shared Savings Program, the Outpatient Prospective Payment (OPPS) and Ambulatory Surgical Center (ASC) Payment System, the End-Stage Renal Disease (ESRD) Prospective Payment System, and the Home Health Prospective Payment System.  

These rules provide details on how Medicare will pay providers for these services, beginning Jan 1, 2023; as such, providers would do well to make some policy changes based on them.   

The Physician Fee Schedule Final Rule includes a reduction in the base conversion payment factor of 4.5 percent due to a number of legislative requirements, including a budget neutrality adjustment and the expiration of a 3-percent supplemental increase in 2022. The rule also adopted most of the American Medical Association (AMA) CPT® changes for “other E&M visits,” effective Jan. 1, 2023. These reflect coding and documentation decisions by the AMA.

There will be another yearlong delay in the split-visit changes established in 2022, allowing other factors besides time to determine how to split charges. There will also be extensions for coverage of certain telehealth services through 2023, allowing practitioners to continue billing the place of service (POS) indicator as in-person, with a 95 modifier to indicate telehealth. 

CMS also will allow behavioral health services to be provided under the general supervision of an appropriate provider when furnished by auxiliary personnel, rather than under direct supervision. 

New Healthcare Common Procedure Coding System (HCPCS) codes and valuations for chronic pain management and treatment were finalized, allowing for more accurate billing of these services. CMS is also finalizing the policy to allow direct access to an audiologist with an order from a physician for non-acute hearing conditions, using a new modifier. 

CMS also instituted a number of changes to the Medicare Shared Savings Program, hoping to increase the number of high-spending and minority participants in Accountable Care Organizations (ACOs). 

For the OPPS/ASC Final rule, CMS is increasing OPPS and ASC payment rates 3.8 percent for facilities meeting quality reporting requirements. CMS is making behavioral health services furnished remotely by clinical staff at outpatient departments covered services. CMS is continuing to require prior authorization for certain hospital outpatient services, adding facet joint intervention to the list.  

The ESRD Final Rule will increase total payments to all ESRD facilities by 3.1 percent, as compared to 2022. CMS is also rebasing its ESRD market basket, updating the labor share of costs and increasing the wage index floor. Several changes to the ESRD Quality Improvement Program are also included.  

The Home Health Fi0nal Rule contained a real surprise. The proposed rule had indicated that CMS needed to reduce payments by around 8 percent over two years, because the new episode-based payment system had increased payments, rather than being budget-neutral. Upon further review, however, CMS has used its discretion to postpone the reduction this year. CMS now estimates that under the 2023 payment rule, payments to home health agencies (HHAs) will increase by around 0.7 percent. CMS is also increasing the home infusion therapy rate by 8.7 percent.

All these changes indicate the need for practitioners and coders to accurately document and code claims so that payments made will be appropriate for the services.