2023 PFS Final Rule: Implications for Anesthesia

The finalized version of the Medicare Physician Fee Schedule for 2023 has been published. While it does not contain a large number of changes for the anesthesia community, there are a few changes that may significantly impact our readers in the new year. Three of these are detailed in today's alert.

The yearly ritual begins. No, it's not the one that involves the placement of festive lights or the buying of family gifts or the stuffing of oversized birds, but rather the annual unveiling of the government's newest regulations for healthcare. The 2023 Medicare Physician Fee Schedule (PFS) was published in the Federal Register on November 18 and, predicably, contains a plethora of changes in process and procedure that will directly impact the practices of America's healthcare providers.

To help us wade through the 2,953 pages of regulations, the Centers for Medicare and Medicaid Services (CMS) has published a "fact sheet" that seeks to summarize the key provisions of the massive document. The following will address those sections of the CMS fact sheet that may be of particular interest to our anesthesia clients.

Reimbursement Rates

For those of you who missed our last e-alert wherein we included newly released information on the PFS conversion factor (CF) and the anesthesia CF, we will reiterate herein the new numbers for next year. The 2023 national PFS CF is $33.06, which is a decrease of $1.55 from the 2022 PFS CF of $34.61. This marks a 4.5 percent drop in the reimbursement rate for non-anesthesia services that an anesthesia provider might nevertheless perform in his or her regular practice (e.g., postoperative pain blocks, ultrasound guidance, invasive lines, TEE).

The anesthesia CF for 2023 will also head in a downward direction. It is being set at $20.60, marking a decrease from $21.56 in 2022. This represents a 4.4 percent decrease in reimbursement for anesthesia services. Again, the anesthesia CF (like the PFS CF) reflects a national average and not what you can necessarily expect in your local geographical area. The anesthesia and non-anesthesia CFs in your region may be a bit higher or lower than the national CFs.

Regardless of the exact CF in your area, the overall Medicare reimbursement rate is trending in the wrong direction; and not all in the healthcare industry are sitting still for these impending pay cuts. This is what American Society of Anesthesiologists (ASA) President Michael W. Champeau, M.D., FASA had to say in a press release concerning the 2023 conversion factors:

The CMS final rule underscores how the Medicare payment system is broken, especially during a time when anesthesia groups are faced with inflation pressures, the COVID-19 pandemic, and health care worker burnout. ASA has urged and will continue to advocate to Congress and regulatory agencies to minimize and reverse these cuts that negatively impact anesthesiologists and the care they provide to the important Medicare patient population.

According to a report from medical news site Fierce Healthcare, members of the U.S. Congress are already gearing up for action. Here is part of the report:

The push to stave off the cuts is getting bipartisan support in Congress. Reps. Larry Bucshon, R-Indiana, and Ami Bera, D-California, introduced the Supporting Medicare Providers Act in September that halts the cuts.  So far, the bill has been referred to the House Energy and Commerce Committee but not advanced out of the panel. Advocacy groups have previously looked at a spending package that must be passed by Dec. 16 or the government runs out of money.  But the legislation has wide bipartisan support in the House with more than 70 co-sponsors.  In addition, a group of 46 bipartisan senators wrote to leadership on Wednesday seeking to delay the cuts, according to a report in Politico. The senators also note that there needs to be a more sustainable system.

So, once again, we will have to wait with bated breath to determine if these cuts in the Medicare reimbursement rates will be reversed at the last minute as they sometimes have in the past.

Blocks That Bundle

The Final Rule appears to be following the lead of the American Medical Association (AMA), which, in its 2023 CPT coding manual update, has bundled imaging, including ultrasound guidance (USG), into several pain block codes. Here is the new AMA/CPT coding language in this regard:

Imaging guidance and localization may be reported separately for 64400, 64405, 64408, 64420, 64421, 64425, 64430, 64435, 64449, 64450. Imaging guidance and any injection of contrast are inclusive components of 64415, 64416, 64417, 64445, 64446, 64447, 64448, 64451, 64454.

You will recall that it wasn't long ago when TAP blocks bundled USG. That is, whether you used imaging or not when performing TAP blocks, the payment would be the same. Now, this bundling of imaging (to include USG) is being extended in the CPT manual for 2023 to additional blocks that many anesthesia providers use for postoperative pain. Here are the descriptors that correspond with the codes, mentioned above, that will no longer allow separate payment for USG (CPT code 76942), beginning next year:

When presenting its 2023 code valuation recommendations, the 2023 PFS final rule noted that the revised codes "include both injection and imaging." The final rule went on to state:

In order to make an equitable comparison between the RUC recommendations and the current values, the RUC suggested we compare the RUC recommendations to values that combined the current work and estimated time of the injection codes and the imaging code with which they are being bundled, CPT code 76942. We agreed with this approach.

The above excerpt is alluding to CMS's decision to adopt a reimbursement formula for these block codes that factor in the work/time value of USG as a potential component of the block service. While providers may not be able to separately bill for USG code 76942 in addition to the above block codes beginning in 2023, the level of payment for these block codes will increase. However, the increase will not reach to the combined level of payment providers realized in 2022 when they could bill USG in addition to these block codes. For example, the relative value unit (RVU) for block code 64415 this year is 1.35. Next year, when that code bundles USG, 64415 will be valued at 1.50 RVUs. That's an increase. However, the RVU for USG code 76942 is .67; so, if you typically used USG this year in addition to 64415, performing that block with USG next year will mean a decrease of .52 RVUs, per service.

Screening Colonoscopy Changes

For 2023, CMS is finalizing, as proposed, two updates to expand Medicare coverage policies for colorectal cancer screening, as follows:

*Reducing the minimum age payment and coverage limitation from 50 to 45 years.

*Expanding the regulatory definition of colorectal cancer screening tests to include a complete colorectal cancer screening, where a follow-on screening colonoscopy after a Medicare covered non-invasive stool-based colorectal cancer screening test returns a positive result. This means that, for most beneficiaries, cost sharing will not apply for either the initial stool-based test or the follow-on colonoscopy.

Anesthesia practitioners who provide services in connection with screening colonoscopies will want to note these changes for 2023.

We will have further updates arising from the 2023 PFS final rule in future alerts. In the interim, if you have questions on this or any other topic, you can reach out to your account executive or contact us at info@anesthesiallc.com.