Health Groups Up in Arms on Proposed 'Modifier 25' Rule Fee Cut

 A proposal from CMS to cut in half the payment for secondary services performed during outpatient visits is drawing fire from a variety of healthcare groups.

"The damage would be extensive to practices who offer procedures and E/M [evaluation and management] visits on the same day as it impacts many clinical scenarios (dermatology, otolaryngology, ophthalmology, and many more)," Anders Gilberg, senior vice president for government affairs at the Medical Group Management Association (MGMA), said in an email to MedPage Today. "MGMA members have relayed to us significant projected financial losses if this cut would go into effect."

Under the proposed rule, known as the "modifier 25 rule," if two or more services are performed on the same day, "the most expensive service (either surgical or E/M visit) would be paid at 100%, and all other surgical procedure(s) or E/M visit(s) would be paid at 50%," CMS explained in a July 16 Federal Register notice.

For example, suppose a patient goes to the doctor for an outpatient E/M visit, which is billed using CPT code 99212, and then has two skin lesions removed, one billed under CPT code 11300, and the other -- a slightly bigger lesion -- billed under CPT code 11301. Because the second skin lesion removal code is the highest-paid service of the three, that code will get paid at 100%, while payments for the office visit and removal of the smaller skin lesion will be reduced by 50%.

"We continue to believe that there are efficiencies when the same physician (or a physician in the same group practice) provides an E/M service for the same patient in conjunction with a procedure with a global period, and that we are likely duplicating payment under the current payment methodology," the authors wrote in explaining the proposal, which was originally proffered in 2019 but later withdrawn.

The comment period on the proposal, which is part of a larger rule on physician payment and other issues, ended Monday. The agency has until Nov. 1 to issue a final rule; it could include the modifier 25 proposal as-is, make changes to it, or leave it out entirely.

Gilberg said the proposal isn't necessary. "CMS already possesses numerous ways to deal with duplication," he said, noting that the RBRVS Update Committee (RUC), which makes recommendations to CMS regarding payment rates, already accounts for overlap, and CMS also has a "misvalued code initiative" that addresses overpayment for specific services.

"We've been urging CMS to rescind the proposal in its entirely, as it's unsupported by evidence and would harm Medicare beneficiaries' access to these important same-day services," he said. "CMS discussed in the proposed rule other potential cuts such as 25% as an option, but those cuts are similarly unsupported by evidence and would still arbitrarily harm medical groups' ability to offer same-day care."

MGMA is not alone in its concerns. "CMS advances this policy on an unsubstantiated assumption of 'likely' duplication, without the evidence a change of this magnitude requires, and without addressing the concerns that led the agency to decline a substantially similar proposal in 2019," the American Medical Association (AMA) and 150 other healthcare organizations, including the MGMA, said in a letter to CMS administrator Mehmet Oz, MD, MBA. "We appreciate the Trump administration's emphasis on keeping independent physician practices sustainable, yet we believe the unintended consequence of CMS' proposed policy will make it extremely difficult for those practices to remain viable."

Another group opposing the proposed rule is the American Independent Medical Practice Association (AIMPA), which represents independent outpatient practices. "Unfortunately, it's going to change how we provide healthcare," Rick Snyder, MD, a Dallas cardiologist who is AIMPA's vice president, said in a phone interview. "It's going to penalize physicians for providing comprehensive same-day care for patients who can't afford to wait."

He cited the example of a melanoma patient who comes in for a routine screening. "Say the dermatologist finds a suspicious lesion somewhere else on the body," Snyder said. "Ideally, you would like to try to remove that same day, or biopsy it, and to make sure you get timely diagnosis and treatment for that. Through this proposal, providing both services ... would trigger a 50% cut for the [less expensive] E/M code, and even though the same-day procedure possibly saved Medicare hundreds of thousands of dollars by avoiding surgery or immunotherapy for advanced melanoma, they're going to be penalized for that." He also cited similar examples for ophthalmology and rheumatology procedures.

In addition to the problems it will cause physicians and their patients, the evidence for making this change is unclear, Snyder said. "They never presented any data behind it -- it just came out of nowhere," he said. "It really fragments care."

There are some signs that physicians' concerns about the proposed rule are being heard on Capitol Hill, he said. "There's a lot of unanimity that CMS should walk this back. ... So we're hopeful and we're getting signs that CMS is listening, but we're anxiously waiting to see what the final rule is going to show."

https://www.medpagetoday.com/practicemanagement/reimbursement/123080