On December 21, 2020, the Consolidated Appropriations Act of 2021 was passed. While at its heart the Act is a bill that includes stimulus relief for the COVID-19 pandemic, there were significant effects of the Act on provider payment from Medicare.

To understand the true significance of these changes we need to go back a few years. In 2018, CMS, in an effort to reduce provider documentation burden, proposed significant changes to the outpatient Evaluation and Management (E/M) codes by consolidating payment of outpatient visits of levels 2 through 5 (and later 2 through 4) into one payment, so that documentation requirements would only need to reach the level 2 criteria. Although noble in its intent, this proposal was not without issues. Therefore, in 2019 the American Medical Association (AMA) CPT Editorial Panel put together a workgroup and created a new set of outpatient E/M Guidelines (new and established patient codes only) for January 1, 2021 (https://www.ama-assn.org/practice-management/cpt/cpt-evaluation-and-management). These new guidelines, the first major change in decades, would retain separate payments for different levels of service, but code choice would be based upon medical decision making or time, rather than having equal weight to history, exam and medical decision making. The history and exam sections would need to document that which is medically necessary. These new codes were then valued by the AMA at the Relative Value Units Update Committee (RUC). The results of the new valuations was an increase in value for nearly every code, due to both the work and practice expense portion of the codes. In the CY 2020 Physician Fee Schedule (PFS) final rule, CMS accepted the new code descriptors and values as recommended and finalized them for implementation on January 1, 2021. In addition, a proposal was included for new add-on Healthcare Common Procedure Coding System (HCPCS) codes that would add value and reimbursement for visit complexity associated with certain medical visits, such as the coordination of all care or complex chronic conditions. In 2020, CMS made further minor changes to these policies.

On December 3, 2021, CMS released its 2021 PFS final rule. As part of the rule, CMS formalized the addition of the complexity add-on code HCPCS code G2211: Visit complexity inherent to evaluation and management associated with medical care services that serve as the continuing focal point for all needed health care services and/or with medical care services that are part of ongoing care related to a patient’s single, serious, or complex condition. (Add-on code, list separately in addition to office/outpatient evaluation and management visit, new or established). This code could be added on to any outpatient E/M visit for new or established Medicare patients (codes 99202 to 99215) who met the criteria in the description. Medicare payment for the code was to be approximately $16 but varies by geographic region. CMS did not restrict the code’s use to any specialties but assumes some specialties will furnish these types of services more than others will. In fact, CMS assumed physicians who rely mainly on office/outpatient E/M visits will report G2211 in about 90% of those visits. CMS believes code G2211 reflects the time, intensity and practice expense required to build longitudinal relationships with patients and addresses most of their health care needs with consistency and continuity over long periods.

The effects of the increased value of outpatient E/M codes and the value of the new HCPC add-on code were not without some concerns. As the Medicare Physician Fee Schedule is budget neutral–meaning if something goes up in value then other things go down in value–the increase in value of the E/M codes significantly reduces the conversion factor. As the conversion factor ultimately determines the reimbursement for provider work when multiplied by the relative value of a code, this change had a profound impact on many specialties, particularly those specialties that perform a high volume of surgeries. The conversion factor was calculated to be $32.41 for 2021, a decrease of $3.68 (about 10.6%) from the 2020 conversion factor. The end result was a significant shift of reimbursement towards those who provide E/M services and a significant reduction in those who rely on the relative value of a code for reimbursement, such as those who perform surgical procedures. As a specialty, urology overall would potentially see a reimbursement increase by 8% due to the high number of E/M services provided by urologists, but obviously individual urologists may see higher or lower changes based upon their own case mix and practice type. Some specialties were estimated to see cuts of over 10%. Obviously, there was some significant stakeholder concern, particularly in those specialties that were to see significant payment cuts.

On December 21, 2020 the Consolidated Appropriations Act of 2021 was passed. The act contained 2 provisions that affected Medicare reimbursement to providers. The first was a delay in the implementation of G2211 for at least 3 years (January 1, 2024), if not longer. CMS will allow practitioners to report the code for qualifying visits furnished on or after January 1, 2021, although it is assigned a PFS payment status indicator of “B” (Bundled) until 2024. That provision alone was significant, as the money that was scheduled to be reimbursed to those providers who perform a high number of E/M codes would now go back into the pot, which would mitigate the reduction in the conversion factor. The second provision was a 1-year increase in the conversion factor by 3.75% with money from the US Treasury Fund. Unfortunately, this is a one-time payment and this money will not be included in the fee schedule in 2022. As a result of the 2 provisions, the final conversion factor for 2021 was set at $34.89, which is about a 3.3% decrease from 2020.

So what does that mean to your practice? As urologists overall perform a high number of E/M visits, which now have a higher value, and due to the mitigation in reduction of the conversion factor, overall the specialty is estimated to see a 9% increase in Medicare reimbursement. Again, that will vary by practice type and case mix. While Medicare will allow providers to report G2211, there does not appear to be a mandate to do so. The 1-year increase in the conversion factor will help practices this year alone, but without further action and advocacy, those monies will not be available in 2022 and beyond.