In the ever-evolving landscape of Medicare coverage, the 2024 Medicare Physician Fee Schedule (MPFS) brings crucial updates to telehealth billing and reimbursement.
During a recent Southwest Telehealth Resource Center webinar presentation, “`Tis The Season: For The 2024 MPFS Telehealth Billing & Reimbursement Updates,” Carol Yarbrough, MBA, CCA, CPC, OCS, CHC, a healthcare compliance and reimbursement specialist, discussed the intricacies of the 2024 MPFS changes affecting telehealth along with their impact on providers and patients alike.
Temporary Medicare telehealth flexibilities
There is some good news, Yarbrough explained, pointing out the extension of COVID-19 public health emergency (PHE) telehealth flexibilities that pushes the "telehealth cliff" back an additional year, extending most of the flexibilities through the end of 2024.
Some highlights of the continuing temporary flexibilities that Yarbrough shared include:
- Patients can be located anywhere in the U.S. at the time of the telehealth service, including, for example, a person’s home.
- All eligible Medicare providers can utilize telehealth to see patients. Some examples of providers that were previously ineligible, but are now eligible, for Medicare reimbursement of telehealth services include occupational therapists (OTs), physical therapists (PTs), speech language pathologists (SLPs), and audiologists. Audiologists are included for the first time in 2024.
- RHCs and FQHCs can continue to use methodology for telehealth services established during the PHE.
- Postponing the necessity for an in-person visit with the physician or practitioner to occur within 6 months prior to commencing mental health telehealth services.
For the full listing of telehealth flexibilities please see the December 2023 CMS Medicare Learning Network Telehealth Services Fact Sheet “What’s Changed?”
Permanent Medicare telehealth changes
Telehealth welcomed permanent additions to the roster of Medicare eligible providers. Yarbrough said mental health counselors (MHCs) and marriage and family therapists (MFTs) are now recognized as distant site providers. Additionally, diabetes self-management training (DSMT) service providers, including nutrition professionals, are now eligible for Medicare reimbursement of telehealth services.
Injection training via telehealth has been added to the list of services covered by Medicare. This service previously authorized temporary flexibility during the PHE, is now a permanent fixture in telehealth offerings. Providers can continue offering injection training via audio and video, demonstrating the lasting impact of adaptations made during the pandemic.
Yarbrough also emphasized the significance of a change to the list of Medicare telehealth Current Procedural Terminology (CPT) codes. She discussed the disappearance of the duration of validity column on the list of codes. Codes are now categorized as either permanent or provisional, providing improved clarity which is crucial for planning and budgeting for future years.
As Yarbrough explored the vast number of CPT codes, she revealed that only 112 of the 268 telemedicine codes are permanent, constituting a mere 1 percent of the total number of codes in the CPT book. The remaining 156 codes are expected to be removed on January 1, 2025. Despite being a small percentage of all CPT codes, these telehealth services played a crucial role during the lockdowns of the PHE, providing essential care to patients, she said.
Yarbrough added that as providers navigate changes in Conversion Factors, CPT code sets, and the extension of telehealth benefits, they must remain vigilant in adapting to the evolving healthcare landscape. The permanence of certain services and the inclusion of new providers signal a continued commitment to accessible and comprehensive healthcare through telehealth.
Conversion Factor and Budget Neutrality
Yarbrough provided insights into the conversion factor and budget neutrality, discussing the methodology employed by the Centers for Medicare and Medicaid Services (CMS) in determining payment rates. According to CMS guidelines, the payment rate for a service is determined by multiplying the geographically adjusted Relative Value Units (RVUs) by a standard conversion factor (CF) expressed in dollars. The statutory formula specified by Medicare governs the annual update of the CF.
Relative Value Units, assigned by CMS, encapsulate three key components of patient care: physician work RVUs, practice expense RVUs, and malpractice RVUs. Moreover, CMS has consistently mandated that section 1115 demonstrations adhere to a "budget neutral" principle. This principle dictates that the cost of these demonstrations should not surpass what would have been expended on the state's Medicaid program without their implementation.
While not inherently centered on telehealth, these aspects significantly influence reimbursement rates. The 2024 Physician Fee Schedule disclosed an overall reduction in reimbursement by 1.25 percent compared to the previous year. The CF for 2024 is set at $32.74. This factor, when multiplied by the RVUs, serves as the foundation for reimbursement calculations.
The decrease in the CF this year signifies a significant trend, as it has dropped by 3.4 percent from its 2023 amount. This reduction impacts various services, and Yarbrough illustrated the effects on a new patient evaluation and management (E/M) service, emphasizing the financial implications for healthcare practices.
For a more in-depth analysis of the changes in Medicare telehealth billing and reimbursement for 2024, please view Carol Yarbrough’s recorded presentation here. Additional previous webinars on a variety of telehealth and healthcare topics can be found on the Arizona Telemedicine Program website.
Additional resources:
- December 2023 CMS Medicare Learning Network Telehealth Services Fact Sheet “What’s Changed?”
- Federal Register: Medicare and Medicaid Programs; CY 2024 Payment Policies Under the Physician Fee Schedule and Other Changes to Part B Payment and Coverage Policies; Medicare Shared Savings Program Requirements; Medicare Advantage; Medicare and Medicaid Provider and Supplier Enrollment Policies; and Basic Health Program
- Calendar Year (CY) 2024 Medicare Physician Fee Schedule Final Rule | CMS
- MM13452 - Medicare Physician Fee Schedule Final Rule Summary: CY 2024 (cms.gov)
- List of Telehealth Services | CMS
- Call to Action: Addressing Health-Related Social Needs in Communities Across the Nation (hhs.gov)
- US consumer survey: Social determinants of health | McKinsey
- Introduction to Relative Value Units and How Medicare Reimbursement is Calculated
