American College Of Surgeons - Inspiring Quality: Highest Standards, Better Outcomes

ACS Seeks Congressional Intervention to Prevent Cuts to Payment for Surgical Services

Finalized policies from the Centers for Medicare and Medicaid Services (CMS) will have drastic consequences for Medicare patients seeking surgical services. These policies also conflict with current law, contradict past CMS action, and are unjustified. Without congressional intervention, these policies would have resulted in significant cuts to physician payment for most surgical services delivered to Medicare patients, exacerbated surgical workforce shortages, and worsened the crisis of rural hospital closures.

The Calendar Year 2021 Physician Fee Schedule (PFS) rule finalized by CMS included increases to reimbursement for evaluation and management (E/M) services, which in turn required decreases to the Conversion Factor used in the PFS due to the statutory "budget neutrality" requirement. The Consolidated Appropriations Act of 2021 (P.L. 116-260) increased payment to all PFS services in 2021 by 3.75 percent to mitigate the impact of the budget neutrality cuts. This relief expires at the end of 2021 and further Congressional action will be needed to prevent cuts from taking place. 

E/M Global Code Policy Changes

In the Calendar Year (CY) 2020 Medicare Physician Fee Schedule (PFS) final rule published in November 2019, CMS increased the payment levels for stand-alone office and outpatient E/M codes. However, CMS did not apply the payment adjustment to the corresponding E/M portion of the global codes. In the CY 2021 PFS, CMS continued to refuse to adjust the global surgery code values. Arbitrarily adjusting some E/M codes but not others conflicts with the Omnibus Budget Reconciliation Act (OBRA) of 1989 (P.L. 101-239), which prohibits Medicare from paying physicians differently for the same work based on specialty. 

Add-On Code Policy Changes

In 2018, CMS proposed to restructure the coding system for office and outpatient E/M visits to reduce documentation burden. Because certain specialties would experience payment cuts due to the proposed collapse of the payment levels, CMS proposed add-on codes to provide an additional payment—specifically for primary care and certain specialty visits—to minimize payment cuts associated with these code changes. However, CMS did not move forward with the single payment proposal and will instead retain the multiple levels of E/M codes that recognizes higher complexity visits. Nevertheless, CMS is still planning to adopt a new add-on code (G2211), even though the agency’s justification for including an add-on code in the new E/M approach no longer exists. Now, instead of correcting a system that would have resulted in unfair payment reductions, the agency is creating a new coding scheme that inappropriately discriminates among physician specialties. The Consolidated Appropriations Act of 2021 delays for three years the implementation of G2211. This action further reduced the impact of the budget neutrality cuts in the CY21 PFS.