Hello Roberta Buell,

This week, CMS went on a spree and released several Proposed Rules. Fortunately, the only one for us to be concerned about herein was the Proposed Rule for Inpatients. As you know, many CMS rules must be finalized earlier than the Physician and Hospital Outpatient rules because these facilities are on the Federal Fiscal Year, which starts on October 1. And do you know what else starts on October 1 each year? That's right--the ICD-10-CM and ICD-10-PCS code sets. We have a summary of the Inpatient Proposed Rule and all the new ICD-10-CM codes for you in this newsletter.

Also included in this issue are the Parts C and D Final Rules for the coming year. The nice thing about these rules is that Medicare is clamping down on MA Prior Authorizations a bit (for example, someone with a degree must review your claims). They are also limiting some of the crazy MA marketing to Seniors that occurs every year. Additionally, MA plans must abide by Medicare's LCDs and NCDs, which they should have been doing anyway.

Sometimes writing this newsletter is a thankless job, particularly when the Rules are constantly changing and/or don't make any sense. Two issues from our last newsletter have changed or were clarified. First, the 27 Drugs that we said had IRA Inflation Rebates were changed to 20 with no elaboration by our friends at CMS. Plus, CMS issued an E/M transmittal explaining, among other things, that when any clinician other than the Treating Physician sees a patient in Observation, they must bill outpatient codes (99202-99215). That makes sense, right? Nope.

It's enough to drive you to the nearest martini!

Da' Mistress

Our Article on the 27 Drugs with IRA Rebates: As you may remember, these rebates are meant to discourage rapid drug price increases. But the initial list of 27 drugs to be affected by the rebates, unveiled on March 15, was cut by about 25% late last week. CMS removed seven of those drugs, including two from Gilead. So, all I have to say is, WHOOPS.

CMS did not explain why it made the corrections--because, after all, they are omnipotent and omniscient. However, its press release and its official list of drugs have now been mysteriously updated. There is no explanation for why or how this happened, but some manufacturers will be happy. Practices may not be so jubilant if this slows down drug claims.

Medicare enrollees taking one of the 20 drugs still on the list began this month paying less than the inflation-adjusted coinsurance payment of 20%. The lowest copay of the list is now set at 14% for those on Leadiant Biosciences’ Carnitor (levocarnitine), which is for treating primary systemic carnitine deficiency, whatever that is.

Drugs removed from the Rebate List include:

• Gilead’s CAR-T treatments Yescarta (Axicabtagene ciloleucel) and Tecartus (brexucabtagene autoleucel), which Gilead did not request to remove.
• Bausch + Lomb’s macular edema drug Xipere (triamcinolone acetonide).
• The T cell lymphoma drug Folotyn (pralatrexate injection) from Acrotech Biopharma, a subsidiary of Aurobindo.
• Kamada’s WinRho (Rhₒ(D) immune globulin), used to increase platelet count to prevent excessive hemorrhage.
• Elzonris (tagraxofusp-erzs), a treatment for blastic plasmacytoid dendritic cell neoplasm from Stemline Therapeutics, owned by the Menarini Group.
• Shionogi’s Fetroja (cefiderocol) for the treatment of complicated urinary tract infections.

As we said, CMS will not fine drug companies for the 2023 and 2024 rebates until 2025. However, some Medicare beneficiaries who take one of the 20 drugs on the updated list may save some much-needed bucks.

CMS finalized the 2024 Medicare Advantage and Part D Final Rule that aims to increase marketing oversight, streamline prior authorization requirements, and improve access to affordable prescription drugs. The 2024 Medicare Advantage and Part D rate notice projects plans will see a 3.32% overall pay bump next year- about a $13.8 billion increase from 2023 rates- higher than the controversial 1.03% bump CMS provided in its advance notice proposal. The agency will also phase in several factors that contribute to its overall rates for the program, including a controversial risk adjustment model after plans asked for more time to consider the model.

Here are some highlights of the Rule for MA and Part D in 2024:

• The risk adjustment model will transition from the ICD-9 coding system to ICD-10, which will help align Medicare Advantage payments with current healthcare practices, current coding, and other federal healthcare programs. Welcome to the real world! The announcement also finalized revisions that will delete certain codes from the hierarchical condition category (HCC) that have a broader variation in diagnosing and coding and thus do not predict costs as well.
• In the 2024 Medicare Advantage and Part D Final Rule, CMS has prohibited ads that do not mention a specific plan name, advertisements that use confusing words and imagery, and those that misleadingly use Medicare logos. In other words, CMS does not want MA plans that deceive patients as they have done for years. The Rule finalizes 21 of the 22 marketing reform provisions from the proposed Rule, with 17 of those finalized as proposed effective 9/30/2023, including these:

1. Notifying enrollees annually and in writing of their ability to opt out of phone calls regarding MA and Part D plan business;
2. Requiring agents to explain the effect of an enrollee’s enrollment choice on their current coverage when they make an enrollment decision;
3. Simplifying plan comparisons by requiring medical benefits be in a specific order and listed at the top of plans’ Summary of Benefits;
4. Prohibiting the marketing of benefits in a service area where they aren’t available unless it is unavoidable (what would make it unavoidable??);
5. Prohibiting the use of superlatives like best or most in marketing unless those statements are documented based on data from the current or prior year; and,
6. Limiting of Medicare information used in marketing as the Rule finalizes discrete limits around the use of the Medicare name, logo, and Medicare card in advertising

• The final Rule inevitably addresses the prior authorization process, requires prior authorization approvals to be valid as long as medically necessary, and states that healthcare professionals with relevant expertise must review coverage denials based on medical necessity--what a concept!!! In addition, the Rule requires Medicare Advantage plans to review utilization management policies annually. How about that for a really novel idea?
• MA plans must comply with national coverage determinations, local coverage determinations, and general coverage and benefit conditions included in traditional Medicare regulations when making coverage decisions, according to the rule text. Another brilliant idea!
• The Rule directs coordinated care plans to provide a 90-day transition period when a beneficiary undergoing treatment switches to a new Medicare Advantage plan. During this time, the new plan cannot require prior authorization for the active treatment. This is to avoid an interruption in care.
• Under the final Rule, plans are banned from denying coverage of a Medicare-covered item or service based on internal, proprietary, or external clinical criteria not found in traditional Medicare coverage policies. I wonder how much this has been abused?!
• The final Rule implements provisions of the Inflation Reduction Act to improve access to affordable prescription drug coverage. CMS is expanding eligibility for the full low-income subsidy benefit to individuals with income up to 150 percent of the federal poverty level for MA plans and Part D coverage.
• Starting January 1, 2024, individuals who currently qualify for the partial low-income subsidy have access to the full low-income subsidy. Eligible beneficiaries will have no deductible, no premiums, and fixed, lowered copayments for certain medications under Medicare Part D as outlined in the IRA.
• LI NET currently operates as a demonstration program that provides immediate and retroactive Part D coverage for eligible low-income beneficiaries who do not yet have prescription drug coverage. In this final Rule, CMS is making the LI NET program a permanent part of Medicare Part D, as section 118 of the CAA outlined in 2022.
• As with all Parts of Medicare in 2023-2024, several policies in the Rule aim to address health equity among Medicare Advantage beneficiaries. CMS finalized changes to the Star Ratings program, including a health equity index reward to incentivize plans to improve care for beneficiaries with certain social risk factors. CMS also reduced the weight of patient experience/complaints and access measures in the Star Ratings process.
• CMS finalized several Mental Health Provisions that they proposed in December. These include proposals to codify appointment wait time standards for primary care and behavioral health services and make clinical psychologists and licensed clinical social workers eligible for a 10-percentage point telehealth credit.
• The MA and Part D rule finalizes most of the reforms outlined in the original proposal, including classifying some mental health services as emergency services which are exempt from prior authorization and requiring plans to notify enrollees mid-year when their behavioral health or primary care provider exits their plan network. The Rule also requires that most MA organizations include behavioral health services in their care coordination programs.

For more information on the Final Rule for Medicare Advantage & Part D, see The Fact Sheet here.

On April 10, 2023, the Centers for Medicare & Medicaid Services (CMS) issued the fiscal year (FY) 2024 Medicare hospital inpatient prospective payment system (IPPS) and long-term care hospital prospective payment system (LTCH PPS) proposed rule.

The proposed rule would update Medicare fee-for-service payment rates and policies for inpatient hospitals and LTCHs for fiscal year (FY) 2024. As you may or may not remember, the Federal Fiscal Year begins on October 1 each year, and Parts A, C, and D are contracted on this timetable. The other item released with the full Inpatient proposal are the ICD-10-CM Changes starting October 1. We have all of the ICD-10-CM additions available for you in our last article. For the FY 2024 rate setting,

CMS proposes to return to its historical practice of using the most recent available data, including the FY 2022 MedPAR claims and the FY 2021 cost reports, to calculate MS-DRG relative weights. CMS does not propose any further major methodological changes for the purposes of setting MS-DRG relative weights for FY 2024.The law requires CMS to update payment rates for IPPS hospitals annually and to account for changes in the prices of goods and services used by these hospitals in treating Medicare patients and other factors. This index is commonly known as the hospital “market basket.” The IPPS pays hospitals for services provided to Medicare beneficiaries using a national base DRG payment rate, adjusted for several factors that affect hospitals’ costs, including the patient’s condition and the cost of hospital labor in the hospital’s geographic area, plus medical education, disproportionate share adjustments, and other factors.

• Changes to Payment Rates under IPPS--The proposed increase in operating payment rates for general acute care hospitals paid under the IPPS that successfully participate in the Hospital Inpatient Quality Reporting (IQR) program and are meaningful electronic health record (EHR) users is projected to be 2.8%. This reflects a projected FY 2024 hospital market basket percentage increase of 3.0%, reduced by a 0.2 percentage point productivity adjustment. Individual hospitals also may be subject to various other adjustments, rendering each hospital's payment rates different and unique.
• Upward and downward adjustments under the Hospital Value-Based Purchasing (VBP) Program--The proposed increase in operating and capital IPPS payment rates will generally increase hospital payments in FY 2024 by $3.3 billion. In addition, CMS projects Medicare disproportionate share of the hospital (DSH) payments and Medicare uncompensated care payments combined will decrease in FY 2024 by approximately $115 million; CMS also estimates that additional payments for inpatient cases involving new medical technologies will decrease by $460 million in FY 2024, primarily driven by the expiration of new technology add-on payments for several technologies. See more further on in the Article regarding the NTAP.
• Safety-Net Hospital Request for Information--Health Equity is a Thing in all rules. CMS is working to advance health equity in the proposed rule by focusing on safety-net hospitals. Safety-net hospitals play a crucial role in the advancement of health equity by making essential services available to the uninsured, underinsured, and other populations that face barriers to accessing health care, including people from racial and ethnic minority groups, the LGBTQ+ community, rural communities, and members of other historically underserved groups. CMS seeks public input on the unique challenges faced by safety-net hospitals and the patients they serve and potential approaches to help them meet those challenges.
• Continuation of the Low-Wage Hospital Policy--CMS proposes to continue temporary policies finalized in the FY 2020 IPPS PPS final rule to address wage index disparities affecting low-wage index hospitals, which includes many rural hospitals.
• Still More Health Equity--The rule also advances one of the goals of the CMS Framework for Health Equity 2022-2032 to more explicitly measure the impact of its policies on health equity. CMS proposes adding 15 new health equity hospital categorizations for the FY 2024 IPPS payment impacts. Moving forward, one of the priorities of the CMS Framework for Health Equity 2022-2032 is to expand the collection, reporting, and analysis of standardized health equity data.
• Social Determinants of Health Diagnosis (SDOH) Codes and MS-DRGs--AT LAST, someone will use these codes for something! IPPS payment is made based on the use of hospital resources in treating a patient’s severity of illness, the complexity of service, and/or consumption of resources. Generally, a higher severity level designation of a diagnosis code results in a higher payment to reflect the increased hospital resource use and a relatively higher paying MS-DRG. CMS is proposing to change the severity designation of the three ICD-10-CM diagnosis codes describing homelessness (e.g., unspecified, sheltered, and unsheltered) from non-complication or comorbidity (NonCC) to complication or comorbidity (CC) based on the higher average resource costs of cases with these diagnosis codes compared to similar cases without SDoH coding. This is a small step in using these codes--but maybe its the first???
• Changes to the New COVID-19 Treatments Add-on Payment (NCTAP)--In response to the COVID-19 Public Health Emergency (PHE), CMS established the New COVID-19 Treatments Add-on Payment (NCTAP) for eligible discharges during the PHE. If the PHE ends in May of 2023, as planned by the Department of Health and Human Services (HHS), discharges involving eligible products would continue to be eligible for the NCTAP through September 30, 2023 (that is, through the end of FY 2023). The NCTAP would expire at the end of FY 2023, and no NCTAP would be made beginning in FY 2024 (that is, for discharges on or after October 1, 2023). So, bye-bye!
• Changes to NTAP Policies for FY 2024--In the proposed rule, CMS discusses 39 NTAP applications. Excluding the applications withdrawn prior to publication of the proposed rule, 19 devices and drugs applied through the traditional pathway and 20 went through the alternative pathways (17 devices with breakthrough or pending breakthrough status, and three products designated as QIDP). The number of FY 2024 NTAP applications reviewed represents a 50% increase over applications reviewed for FY 2023, even with the 15 withdrawn applications. To increase transparency and improve the efficiency of the NTAP program and application process, CMS is proposing to require NTAP applicants for technologies that are not already FDA market authorized to have a complete and active FDA market authorization application request at the time of submission of NTAP application submission, and to move the FDA approval deadline from July 1 to May 1, beginning with applications for FY 2025. CMS believes these policy changes would improve the completeness of submitted NTAP applications, allow for fuller analysis, and improve the ability of CMS to identify eligibility concerns for the proposed rule. In addition, they will not have to consider products that remain unapproved.
• Hospital Value-Based Purchasing (VBP) Program--The Hospital VBP Program is a budget-neutral program funded by reducing participating hospitals’ base operating DRG payments each fiscal year by 2% and redistributing the entire amount back to the hospitals as value-based incentive payments. Several new measures are proposed and a good explanation of these is here.
• Hospital IQR Program--CMS proposes adding three measures, removing three, and revising three quality measures in the IQR Program. The three measures CMS proposes to add are electronic clinical quality measures (eCQMs): !) Hospital Harm — Pressure Injury eCQM. 2) Hospital Harm — Acute Kidney Injury eCQM. 3)Excessive Radiation Dose or Inadequate Image Quality for Diagnostic CT in Adults (Hospital Level — Inpatient) eCQM. Notable among the revisions to existing measures is CMS’ proposal to update the COVID-19 vaccination among healthcare personnel measure beginning with the fourth quarter reporting period of the calendar year (CY) 2023 (FY 2025 payment determination). CMS proposes to collect data on the number of healthcare personnel who are up to date with recommended COVID-19 vaccinations instead of having received only a primary vaccination series.
• HAC Reduction Program--For the HAC Reduction Program, CMS proposes to create a validation reconsideration process for hospitals that fail to meet data validation requirements, beginning with the FY 2025 program year (for CY 2022 discharges).
• Promoting Interoperability Program--CMS includes several proposals for the Medicare Promoting Interoperability (PI) Program, including establishing a 180-day reporting period for CY 2025. CMS also proposes to adopt the three new eCQMs proposed for the IQR Program, beginning with the CY 2025 reporting period. Additionally, CMS proposes various changes to existing measures and other technical changes to the program.

See The Fact Sheet for more details on the IPPS Proposals.

As mentioned several times in our recent seminars and webinars, Medicare departs from CPT E/M Guidelines in many ways. What commercial plans will do is anyone's guess--but bear in mind that CMS' guidelines are more conservative, i.e., will save $$$. On February 9th, CMS clarified several ways they are not sticking to CPT guidelines in Transmittal 11842, Change Request 13064. Some clarifications include the following with one significant change.

• "Medical necessity of a service is the overarching criterion for payment in addition to the individual requirements of an E/M visit code. It would not be medically necessary or appropriate to bill a higher level of E/M service when a lower level of service is warranted. The volume of documentation should not be the primary influence upon which a specific level of service is billed. Documentation should support the level of service reported." In other words, cease and desist with the cutting and pasting.
• "Interpret the phrase "new patient" to mean a patient who has not received any professional services, i.e.,E/M service or other face-to-face service (e.g., surgical procedure) from the physician or physician group practice (same physician specialty) within the previous three years. For example, suppose a professional component of a previous procedure is billed in a 3-year time period. In that case, e.g., a lab interpretation is billed, and no E/M service or other face-to-face service with the patient is performed; this patient remains a new patient for the initial visit. An interpretation of a diagnostic test, reading an x-ray or EKG, etc., in the absence of an E/M service or other face-to-face service with the patient, does not affect the designation of a new patient." This is not a change but differs from the CPT definition, where subspecialty is included.
• "Our reviewers will use the medical record documentation to objectively determine the medical necessity of the visit and accuracy of the documentation of the time spent (whether documented via a start/stop time or documentation of total time) if time is relied upon to support the E/M visit." In other words, if you use time as the visit criteria, it must be believable in your documentation.
• Here's the biggie--"Observation care codes are billed by the treating practitioner. All other practitioners who furnish consultations or additional evaluations or services while the patient receives hospital outpatient observation services must bill the appropriate outpatient service codes." This means all other physicians besides the treating physician bill with 99202-99215. What the what? If Observation and Inpatient are the same from a coding perspective, this makes no sense. But here it is in black and white.
• "A/B MACs (B) pay for an initial hospital inpatient or observation care service if a practitioner sees a patient in the emergency department and decides to admit the person to the hospital or place the patient in observation care. They do not pay for both E/M services. Also, they do not pay for an emergency department visit by the same practitioner on the same service date. When the patient is admitted to the hospital via another site of service (e.g., hospital emergency department, physician's office, nursing facility), all services provided by the practitioner in conjunction with that admission are considered part of the initial hospital inpatient or observation care when performed on the same date as the admission." This differs from the Modifier 25 guidance in CPT, allowing two visits to be billed by the same physician in a day.

We hope this concludes Medicare's departure from CPT. But don't count on it.

Yes, that's right 400+ new codes have been released for 2024, for the Fiscal Year starting on October 1, 2023. We will not bore the heck out of you by highlighting all of those codes. But we have them available to you ABSOLUTELY FREE right here and later in the Article.

Here are some highlights from the many codes to be added next October. BUT, do not forget that we are NOT telling you about those codes that are changed and those that are deleted--so you are on your own with those. Okay, here goes:

• There are no new malignant neoplasm codes for 2024, but there are new codes for Desmoid tumors. These tumors are not malignant but are often treated by Oncologists, and they will fall under D48.1-.
• There is a real emphasis on Sickle Cell--both to better describe the disease and complications thereof (D57.-) and Retinopathy associated with Sickle Cell (H36.8-).
• Because of the epidemic of diabetes in our junk food society, there are new codes for Metabolic Syndrome and insulin resistance (E88.8-).
• Obviously, as the Boomers get older and older, there is more Parkinson's disease and more detailed information about its complications, New codes for Parkinson's can be found in code set G20.-.
• There are more codes for migraine headaches--this time, codes have been added for chronic migraine with aura (G43.E-)--in my life, these have been associated with too much red wine.
• There are several new codes for muscle entrapment in the eye (ouch!). These codes are located in H50.6-. Also, there are additional codes for foreign body sensation in the eye (H57.8A-)
• Age-related osteoporosis is a very widespread problem for post-menopausal women. This coming year, there will be additional codes for osteoporosis with pathological fractures (M80.08- and M80.88-) that are age-related and not.
• Here's one diagnosis I will never have: breast density, mostly found on mammography. These breast density codes can be found in the Symptom Chapter under R92.3-.
• And, of course, there is more coding for the Social Determinants of Care in the Z59.1- (homelessness) series.

And what year would be complete without some very funny codes? This year, ICD-10-CM has added codes for many different objects entering into or through, or into a natural orifice in the body (W44.-). These objects, according to ICD-10, can include coins, jewelry, toys, magnets, food, insects, batteries, and rubber bands. But, the ABSOLUTE FUNNIEST of all in this code series are these:

• W44.F1XA Bezoar entering into or through a natural orifice, initial encounter
• W44.F1XD Bezoar entering into or through a natural orifice, subsequent encounter
• W44.F1XS Bezoar entering into or through a natural orifice, sequela

If you don't know what a Bezoar is, it can be a giant hairball usually blocking the intestine in animals or people. It often grows there from eating hair.

For more fun with new ICD-10 codes, see the entire list. Do not forget that there are other changes too!

This newsletter is a brief interpretation of information. It may be subject to typos, misinterpretation, and misapplication. This company and its parent assume no liability for the content herein. Moreover, this is not consultative or legal advice. Billing of claims and payment thereof is individual to payers and circumstance. Providers should check with each payer prior to billing. This information is time-sensitive and may change at any time. Please ensure that you constantly check for new information.