CMS Releases CY2025 Medicare Physician Fee Schedule Final Rule

On Friday, November 1, the Centers for Medicare and Medicaid Services (CMS) issued the finalized 2025 Medicare Physician Fee Schedule (PFS) and Quality Payment Program (QPP). Absent Congressional intervention, the final rule will take effect January 1, 2025. Below are the highlights:

Payment Policy Changes
Despite strong pushback from The US Oncology Network and numerous provider organizations, the finalized CY 2025 PFS conversion factor is $32.35, a decrease of $0.94 (or -2.83%) from the CY 2024. This conversion factor accounts for the statutorily-required update to the conversion factor for CY 2025 of 0%, the expiration of the 2.93% increase for 2024 provided by the Consolidated Appropriations Act of 2024, and a 0.02% statutorily-required budget neutrality adjustment to account for changes in Relative Value Units.

Beyond the -2.83% impact related to the conversion factor, changes in payment policy outlined in the proposed rule result in the overall average impact for the following specialties:
Hematology/Oncology: -1%

• Hematology/Oncology: -1%
• Radiation Oncology and Radiation Therapy Centers: 0%
• Interventional Radiology: -2%
• Urology: 0%
• Rheumatology: 0%
• Gastroenterology: 0%
• Diagnostic Testing Facility: -2%
• Independent Laboratory: 0%
• Ophthalmology: -2%
• General Surgery: 0%

*Note, the specialty impact estimates above do not account for the reduced conversion factor.

Telehealth Services
In the final rule, CMS has finalized the following telehealth provisions:

• A reinstitution of the statutory limitations that were in place for Medicare telehealth services prior to the COVID-19 PHE. These include geographic and location restrictions on where the services are provided, and limitations on the scope of practitioners who can provide Medicare telehealth services. However, the final rule reflects CMS’ goal to preserve some important, but limited, flexibilities in our authority, and expand the scope of and access to telehealth services where appropriate.
• For a for a certain subset of services that are required to be furnished under the direct supervision of a physician or other supervising practitioner, to permanently adopt a definition of direct supervision that allows the supervising physician or practitioner to provide such supervision via a virtual presence through real-time audio and visual interactive telecommunications. CMS is specifically finalizing to make permanent that the supervising physician or practitioner may provide such virtual direct supervision (1) for services furnished incident to a physician or other practitioner’s professional service, when provided by auxiliary personnel employed by the billing physician or supervising practitioner and working under his or her direct supervision, and for which the underlying HCPCS code has been assigned a PC/TC indicator of “5” and services described by CPT code 99211, and (2) for office or other outpatient visits for the evaluation and management of an established patient who may not require the presence of a physician or other qualified health care professional.
• For all other services furnished incident that require the direct supervision of the physician or other supervising practitioner, CMS is finalizing to continue to permit direct supervision be provided through real-time audio and visual interactive telecommunications technology only through December 31, 2025.
• Effective January 1, 2025, an interactive telecommunications system may include two-way, real-time, audio-only communication technology for any Medicare telehealth service furnished to a beneficiary in their home, if the distant site physician or practitioner is technically capable of using an interactive telecommunications system, but the patient is not capable of, or does not consent to, the use of video technology.
• Through CY 2025, CMS will continue to permit distant site practitioners to use their currently enrolled practice locations instead of their home addresses when providing telehealth services from their home.

Strategies for Improving Global Surgery Payment Accuracy
For CY 2025, CMS is finalizing their proposed policy to broaden the applicability of the transfer of care modifier 54, for all 90-day global surgical packages (global packages), in any case when a practitioner expects to furnish only the surgical procedure portion of the global package, including but not limited to when there is a formal, documented transfer of care as under current policy or an informal, non-documented but expected, transfer of care.

CMS is also finalizing a new add-on code, HCPCS code G0559, for post-operative care services furnished by a practitioner other than the one who performed the surgical procedure (or another practitioner in the same group practice). This add-on code will more appropriately reflect the time and resources involved in these post-operative follow-up visits by practitioners who were not involved in furnishing the surgical procedure.

Payment for Radiopharmaceuticals in the Physician Office
CMS is finalizing, a clarification that, for radiopharmaceuticals furnished in a setting other than a hospital outpatient department, MACs shall determine payment limits for radiopharmaceuticals based on any methodology used to determine payment limits for radiopharmaceuticals in place on or prior to November 2003. Such methodology may include, but is not limited to, the use of invoice-based pricing.

Requiring Manufacturers of Certain Single-dose Container or Single-use Package Drugs to Provide Refunds with Respect to Discarded Amounts
CMS is finalizing clarifications to several prior policies, including: exclusions of drugs, for which payment has been made under Part B for fewer than 18 months, from the definition of refundable single-dose container or single-use package drug, and identifying single-dose containers. CMS is also finalizing a requirement that the JW modifier must be used if a billing supplier is not administering a drug, but there are amounts discarded during the preparation process before supplying the drug to the patient. Finally, CMS is finalizing that skin substitutes will not be included in the identification of refundable drugs for the calendar quarters in 2025.

Expand Colorectal Cancer Screening
CMS is finalizing an update and expansion of coverage of colorectal cancer (CRC) screening. They are removing coverage of barium enema as a method of screening because this service is rarely used in Medicare and is no longer recommended as an evidence-based screening method. CMS is also expanding coverage for CRC screening to include computed tomography colonography (CTC).

CMS is adding Medicare covered blood-based biomarker CRC screening tests as part of the continuum of screening. Like stool-based CRC screening tests, which are already in the definition of a “complete CRC Screening,” a blood-based biomarker test with a positive result will lead to a follow-on screening colonoscopy (with no beneficiary cost-sharing). CMS is also revising the regulation text to clarify that CRC screening frequency limitations do not apply to the follow-on screening colonoscopy in the context of “complete CRC screening.” These actions seek to promote access and remove barriers for much needed cancer prevention and early detection within rural communities and communities of color that are especially impacted by the incidence of CRC.

CY 2025 Updates to the Quality Payment Program

• CMS finalized 6 new MVPs for the 2025 performance period that are related to ophthalmology, dermatology, gastroenterology, pulmonology, urology, and surgical care.
• CMS finalized limited modifications to the previously finalized MVPs, including the consolidation of 2 neurology-focused MVPs into a single neurological MVP.
• CMS finalized, with modifications, an additional quality measure set under the APP called APP Plus, which will be an optional quality measure set for MIPS APM participants, except for Medicare Shared Saving Program (Shared Savings Program) Accountable Care Organizations (ACOs).
• CMS finalized the APP Plus quality measure set will be comprised of 11 measures, consisting of the 6 measures an additional quality measure set under the APP, which would include the 6 measures in the existing APP quality measure set, 5 of which are Adult Universal Foundation measures, and 5 additional measures from the Adult Universal Foundation measure set. These measures will be incrementally incorporated over time, more gradually than originally proposed.
• CMS is maintaining the current performance threshold policies, leaving the performance threshold set at 75 points for the 2025 performance period.

To read the CMS press release on the PFS proposal, CLICK HERE.

To read the CMS fact sheet on the PFS proposal, CLICK HERE.

To read the CMS fact sheet on the QPP proposal, CLICK HERE.

To read the PFS/QPP proposed rule in its entirety, CLICK HERE.