AHCA/NCAL Submit Comments Challenging Proposed Medicare Part B Fee Schedule Cuts

​Medicare payment rates for medical services furnished by physicians, non-physician practitioners, portable x-ray, physical and occupational therapy, speech-language pathology, and other services under the Part Benefit are determined annually through the Medicare Physician Fee Schedule (PFS) payment rulemaking, with an effective date of January 1 of the following year. On August 17, 2020 the Centers for Medicare and Medicaid Services (CMS) published the CY 2021 PFS proposed rule in the Federal Register that detailed proposed changes in payment rates, telehealth, and therapy service policies that will have far-reaching impact on AHCA/NCAL member residents.       

On October 5, the American Health Care Association and National Center for Assisted Living (AHCA/NCAL) submitted comments CMS challenging proposed payment rate cuts for services furnished to residents of skilled nursing facilities (SNF), Assisted Living (AL) residences, and residences for individuals with intellectual and developmental disabilities (ID/DD). Additionally, AHCA/NCAL and a coalition of 45 other groups representing physician and non-physician specialties, suppliers, and facility-based providers submitted a joint comment letter opposing the proposed cuts and offering alternative solutions within CMS authority.

In the CY 2020 PFS Final Rule (84 FR 62568), CMS finalized broad changes related to physician evaluation and management (E/M) services to reduce administrative burden, improve payment rates, and reflect current clinical practice.The health care community supported restructuring and revaluing the office-based E/M codes, which will increase payments for primary care and other office-based services. Unfortunately, by law, any changes to the PFS cannot increase or decrease expenditures by more than $20 million. To comply with this budget neutrality (BN) requirement, any increases must, therefore, be offset by corresponding decreases. 

CMS estimates that the 2021 proposed rule policies will increase Medicare spending by $10.2 billion, necessitating steep cuts by reducing the Medicare conversion factor from $36.0896 to $32.2605, or a 10.6 percent decrease. ​​As reflected in Table 90 of the proposed rule, payments for common PFS services furnished to residents in AHCA/NCAL member SNF, AL, and ID/DD residences will be cut nine percent for PT and OT services and 6 percent for portable x-ray services. In addition, the proposed rate tables for individual procedures indicates that SLP services as well as physician E/M services furnished to SNF residents will be cut up to 11 percent.  

In the AHCA/NCAL comments, the Association states:
We strongly object to the extraordinary budget neutrality (BN) reduction proposed by the CMS (the “proposed CF reduction”). While we support the CPT coding revisions and revaluations of office and outpatient evaluation and management (E/M) services recommended by the AMA/Specialty Society RVS Update Committee (RUC), we strongly oppose the proposed budget neutrality (BN) reduction proffered by CMS for these and other PFS changes proposed for 2021. 

Due to age and multiple comorbid conditions, residents of SNFs and long-term care residences, such as AL and ID/DD centers are the most vulnerable population impacted by COVID-19 — with incidence and mortality rates much higher than all other demographics. While more than 80% of this population that are infected successfully survive COVID-19, these patients frequently experience significant loss of weight, strength, mobility, and ability to perform activities of daily living, and enjoy life at a level possible prior to the pandemic. These individuals will often need various and sometimes extensive and long-term therapy to restore their abilities to eat, move about, and perform daily activities as independently as possible. Reduced access to PT, OT, and SLP rehabilitation services resulting from the proposed draconian cuts to PFS payments would result in a lower quality of life for nursing facility residents and higher and costly rates of institutionalization of assisted and senior living residents who are unable to restore functional losses experienced during the acute phase of their COVID-19 illness. 

Furthermore, while the PFS payment for office-based E/M codes are due to be increased, the physician payment codes for E/M services furnished to SNF short and long-stay residents as well as portable x-ray services are proposed to be cut dramatically, which will seriously impact beneficiary access to care if these providers decide to no longer care for residents in nursing homes.

In addition to opposing the proposed rule payment rate cuts, the AHCA/NCAL comments [link “comments” to the AHCA/NCAL comment letter] also address the following topics:
  • Medicare telehealth and other services involving communication technology
  • Refinements to values for outpatient therapy evaluations analogous to office/outpatient E/M visits
  • Revised medical record documentation requirements for physical and occupational therapists and speech-language pathologists
  • Planned 30-day delayed effective date for the final rule