[Federal Register Volume 91, Number 135 (Thursday, July 16, 2026)]
[Proposed Rules]
[Pages 43842-44557]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2026-14327]
[[Page 43841]]
Vol. 91
Thursday,
No. 135
July 16, 2026
Part IV
Department of Health and Human Services
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Centers for Medicare & Medicaid Services
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42 CFR Parts 400, 405, 406, et al.
Medicare and Medicaid Programs; CY 2027 Payment Policies Under the
Physician Fee Schedule and Other Changes to Part B Payment and Coverage
Policies; Medicare Shared Savings Program Requirements; and Medicare
Prescription Drug Inflation Rebate Program; Proposed Rule
Federal Register / Vol. 91, No. 135 / Thursday, July 16, 2026 /
Proposed Rules
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DEPARTMENT OF HEALTH AND HUMAN SERVICES
Centers for Medicare & Medicaid Services
42 CFR Parts 400, 405, 406, 407, 410, 414, 415, 417, 422, 423, 424,
425, 427, 428, 512
[CMS-1848-P]
RIN 0938-AV82
Medicare and Medicaid Programs; CY 2027 Payment Policies Under
the Physician Fee Schedule and Other Changes to Part B Payment and
Coverage Policies; Medicare Shared Savings Program Requirements; and
Medicare Prescription Drug Inflation Rebate Program
AGENCY: Centers for Medicare & Medicaid Services (CMS), Department of
Health and Human Services (HHS).
ACTION: Proposed rule.
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SUMMARY: This proposed rule addresses: changes to the physician fee
schedule (PFS); other changes to Medicare Part B payment policies to
ensure that payment systems are updated to reflect changes in medical
practice, relative value of services, and changes in the statute;
codification of establishment of new policies for: the Medicare
Prescription Drug Inflation Rebate Program under the Inflation
Reduction Act of 2022; the Ambulatory Specialty Model; updates to drugs
and biological products paid under Part B; Medicare Shared Savings
Program requirements; updates to the Quality Payment Program; updates
to policies for Rural Health Clinics and Federally Qualified Health
Centers; update to the Ambulance Fee Schedule regulations; codification
of the Inflation Reduction Act and Consolidated Appropriations Act,
2026 provisions; updates to Clinical Laboratory Fee Schedule
regulations; updates to the Medicare Promoting Interoperability
Program.
DATES: To be assured consideration, comments must be received at one of
the addresses provided below, by September 14, 2026.
ADDRESSES: In commenting, please refer to file code CMS-1848-P.
Comments, including mass comment submissions, must be submitted in
one of the following three ways (please choose only one of the ways
listed):
1. Electronically. You may submit electronic comments on this
regulation to https://www.regulations.gov/docket/CMS-2026-2377. Follow
the ``Submit a comment'' instructions.
2. By regular mail. You may mail written comments to the following
address ONLY: Centers for Medicare & Medicaid Services, Department of
Health and Human Services, Attention: CMS-1848-P, P.O. Box 8016,
Baltimore, MD 21244-8016.
Please allow sufficient time for mailed comments to be received
before the close of the comment period.
3. By express or overnight mail. You may send written comments to
the following address ONLY: Centers for Medicare & Medicaid Services,
Department of Health and Human Services, Attention: CMS-1848-P, Mail
Stop C4-26-05, 7500 Security Boulevard, Baltimore, MD 21244-1850.
For information on viewing public comments, see the beginning of
the SUPPLEMENTARY INFORMATION section.
FOR FURTHER INFORMATION CONTACT:
[email protected], for any issues not identified
below. Please indicate the specific issue in the subject line of the
email. For all questions related to reporting a service on a claim,
please contact your Medicare Administrative Contractor.
Michael Soracoe, Morgan Kitzmiller, or
[email protected], for issues related to
practice expense, work RVUs, conversion factor, and PFS specialty-
specific impacts.
Hannah Ahn, Allison Bramlett, or
[email protected], for issues related to
potentially misvalued services under the PFS.
Mikayla Murphy, or [email protected], for
issues related to direct supervision using two-way audio/video
communication technology, telehealth, and other services involving
communications technology.
Maya Peterson or [email protected], for
issues related to E/M overlap between stand-alone visits and global
periods, and E/M visit complexity add-on code (MOD1 and MOD2).
Terry Simananda, or [email protected], for
issues related to smoking and tobacco use cessation, screening, brief
intervention, and referral to treatment, psychiatric collaborative care
model, and shared medical appointments.
Sarah Leipnik, or [email protected], for
issues related to global surgery payment accuracy.
Pamela West, or [email protected], for
issues related to comprehensive outpatient rehabilitation facility
(CORF) services and KX modifier thresholds.
Zehra Hussain, or [email protected], for
issues related to payment of skin substitutes.
Laura Kennedy, (410) 786-3377, Rebecca Ray, (667) 414-0879, and Jae
Ryu, (667) 414-0765 for issues related to Drugs and Biological Products
Paid Under Medicare Part B.
Lisa Parker, (410) 786-4949, or [email protected], Michele
Franklin, (410) 786-9226, or [email protected], and Patrick Sartini,
(410) 786-9252 for issues related to FQHC and RHC payments.
Patrick Sartini, (410) 786-9252, or [email protected] for
issues related to Clinical Laboratory Fee Schedule.
Sabrina Ahmed, (410) 786-7499, or [email protected],
for issues related to the Medicare Shared Savings Program (Shared
Savings Program) quality performance standard and other quality
reporting requirements.
Kimberly Spalding Bush, (410) 786-3232, or
[email protected], for issues related to the Shared
Savings Program certified electronic health record technology (CEHRT)
use requirements.
Janae James, (410) 786-0801, or [email protected],
for issues related to Shared Savings Program beneficiary assignment and
financial methodology.
Lucy Bertocci, (443) 681-0762, or [email protected],
for issues related to reducing or eliminating Part B cost sharing,
prepaid shared savings, beneficiary notifications, advance investment
payments or identifying ACOs experienced with performance-based risk.
Elisabeth Daniel, (667) 290-8793, for issues related to the
Medicare Prescription Drug Inflation Rebate Program.
Benjamin Picillo or Genevieve Kehoe,
[email protected], or 1-844-711-2664 (Option 4) for
issues related to the Ambulatory Specialty Model.
Amy Gruber, (410) 786-1542, for issues related to Ambulance Fee
Schedule.
Kati Moore, (410) 786-5471, for inquiries related to the Merit-
based Incentive Payment System (MIPS) track of the Quality Payment
Program (QPP).
Trevey Davis, (410) 786-6600, for inquiries related to the Advanced
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Alternative Payment Models (APMs) track of QPP.
Jessica Warren, (410) 786-7519, and Lisa Marie Gomez, (410) 786-
1175, for inquiries related to the Medicare Promoting Interoperability
Program.
SUPPLEMENTARY INFORMATION:
Inspection of Public Comments: All comments received before the
close of the comment period are available for viewing by the public,
including any personally identifiable or confidential business
information that is included in a comment. We post all comments
received before the close of the comment period on the following
website as soon as possible after they have been received: https://www.regulations.gov. Follow the search instructions on that website to
view public comments. CMS will not post on Regulations.gov public
comments that make threats to individuals or institutions or suggest
that the commenter will take actions to harm an individual. CMS
continues to encourage individuals not to submit duplicative comments.
We will post acceptable comments from multiple unique commenters even
if the content is identical or nearly identical to other comments.
Plain Language Summary: In accordance with 5 U.S.C. 553(b)(4), a
plain language summary of this rule may be found at https://www.regulations.gov/.
Addenda Available Only Through the internet on the CMS website: The
PFS Addenda along with other supporting documents and tables referenced
in this proposed rule are available on the CMS website at https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PhysicianFeeSched/index.html. Click on the link on the left side of the
screen titled, ``PFS Federal Regulations Notices'' for a chronological
list of PFS Federal Register and other related documents. For the CY
2027 PFS final rule, refer to item CMS-1848-P. Readers with questions
related to accessing any of the Addenda or other supporting documents
referenced in this proposed rule and posted on the CMS website
identified above should contact
[email protected].
CPT (Current Procedural Terminology) Copyright Notice: Throughout
this proposed rule, we use CPT codes and descriptions to refer to a
variety of services. We note that CPT codes and descriptions are
copyright 2020 American Medical Association. All Rights Reserved. CPT
is a registered trademark of the American Medical Association (AMA).
Applicable Federal Acquisition Regulations (FAR) and Defense Federal
Acquisition Regulations (DFAR) apply.
I. Executive Summary
A. Purpose
This major annual rule proposes to revise payment policies under
the Medicare PFS and makes other policy changes, including proposals to
implement certain provisions of the Full-Year Continuing Appropriations
and Extensions Act, 2025 (Pub. L. 119-4, March 15, 2025), Further
Continuing Appropriations and Other Extensions Act of 2024 (Pub. L.
118-22, November 17, 2023), Consolidated Appropriations Act, 2023 (Pub.
L. 117-328, December 29, 2022), Inflation Reduction Act of 2022 (IRA)
(Pub. L. 117-169, August 16, 2022), Consolidated Appropriations Act,
2022 (Pub. L. 117-103, March 15, 2022), Consolidated Appropriations
Act, 2021 (CAA, 2021) (Pub. L. 116-260, December 27, 2020), Bipartisan
Budget Act of 2018 (BBA of 2018) (Pub. L. 115-123, February 9, 2018),
the Substance Use-Disorder Prevention that Promotes Opioid Recovery and
Treatment for Patients and Communities Act (SUPPORT Act) (Pub. L. 115-
271, October 24, 2018) and Consolidated Appropriations Act, 2026 (Pub.
L. 119-75, February 3, 2026), related to Medicare Part B payment. In
addition, this proposed rule includes provisions regarding other
Medicare payment provisions described in sections III. and IV. of this
proposed rule.
This proposed rule updates policies for the Medicare Prescription
Drug Inflation Rebate Program codified at 42 CFR parts 427 and 428
consistent with sections 1847A(i) and 1860D-14B of the Social Security
Act (the Act). For the Medicare Part B Drug Inflation Rebate Program,
this rule describes the identification of the Consumer Price Index for
all Urban Consumers (CPI-U) for the payment amount benchmark quarter
and the rebate period in certain instances when CPI-U survey data are
unavailable and the calculation of the Part B rebate amount in such
instances; proposes to clarify the definition of ``first marketed
date''; and proposes to clarify that certain skin substitutes would not
be excluded from the definition of a Part B rebatable drug. For the
Medicare Part D Drug Inflation Rebate Program, this rule describes the
identification of the CPI-U for the payment amount benchmark period and
applicable period in certain instances when CPI-U survey data are
unavailable and the calculation of the Part D rebate amount in such
instances; proposes a modification to the methodology finalized in the
CY 2026 PFS final rule to account for 340B-eligible units for AIDS Drug
Assistance Program (ADAP) enrollees for the applicable period beginning
October 1, 2025; and proposes to require Medicare providers and
suppliers that are 340B covered entities to submit Part D 340B claims
data to the Medicare Part D Claims Data 340B Repository beginning in
2027.
This proposed rule proposes to modify policies for the Shared
Savings Program, which is a voluntary program that started in 2012. The
program allows groups of providers and suppliers to form or participate
in Accountable Care Organizations (ACOs), and to be held accountable
for the quality and total cost of care for an assigned population of
Medicare fee-for-service (FFS) beneficiaries.
B. Summary of the Key Provisions
Section 1848 of the Act requires us to establish payments under the
PFS, based on national uniform relative value units (RVUs) that account
for the relative resources used in furnishing a service. The statute
requires that RVUs be established for three categories of resources:
work, practice expense (PE), and malpractice (MP) expense. In addition,
the statute requires that each year we establish, by regulation, the
payment amounts for physicians' services paid under the PFS, including
geographic adjustments to reflect the variations in the costs of
furnishing services in different geographic areas.
In this major proposed rule, we are proposing RVUs for CY 2027 for
the PFS to ensure that our payment systems are updated to reflect
changes in medical practice and the relative value of services, as well
as changes in the statute. This proposed rule also includes discussions
and provisions regarding several other Medicare Part B payment
policies, and other policies regarding programs administered by CMS.
Specifically, this proposed rule addresses:
Background (section II.A.)
Determination of PE RVUs (section II.B.)
Payment for Medicare Telehealth Services (section II.C.)
Valuation of Specific Codes, Including Potentially Misvalued
Codes (PMVC) (section II.D.)
Redesigning Primary Care to Make America Healthy Again
(section II.E.)
Comprehensive Outpatient Rehabilitation Facility (CORF)
Services and KX Modifier Thresholds (section II.F.)
Supporting Beneficiaries Planning for Future Medical Decisions
(section II.G.)
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Current Procedural Terminology (CPT) Request for Information
(RFI) (section II.H.)
Drugs and Biological Products Paid Under Medicare Part B:
Discarded Drugs (section III.A.)
Rural Health Clinics (RHCs) and Federally Qualified Health
Centers (FQHCs) (section III.B.)
Clinical Laboratory Fee Schedule (CLFS): CAA, 2026 (section
III.C.)
Proposed Changes to the Ambulatory Specialty Model (ASM)
(section III.D.)
Limiting Medicare Coverage of Certain Individuals (section
III.E.)
Medicare Prescription Drug Inflation Rebate Program (section
III.F.)
Medicare Shared Savings Program (section III.G.)
Changes to the Regulations Associated with the Ambulance Fee
Schedule (section III.H.)
Request for Information (RFI) on Duplicate Laboratory Testing,
Imaging, and Result Sharing and Interoperability (section III.I.)
CY2027 Modifications to the Quality Payment Program Reporting
and Data Submission (section IV.)
Collection of Information Requirements (section V.)
Response to Comments (section VI.)
Regulatory Impact Analysis (section VII.)
C. Summary of Costs and Benefits
Based on our estimates, the Office of Information and Regulatory
Affairs in the Office of Management and Budget has determined that this
proposed rule is economically significant under section 3(f)(1) of
Executive Order 12866. As required by section 1848(d)(1)(A) of the Act,
beginning in 2026, there are two separate conversion factors (CFs): one
for items and services furnished by a qualifying APM participant (QP)
as defined in section 1833(z)(2) of the Act and 42 CFR 414.1305
(referred to as the qualifying APM conversion factor) and another for
items and services furnished by clinicians who are not QPs (referred to
as the nonqualifying APM conversion factor), equal to the respective
conversion factor for the previous year multiplied by the update
established under section 1848(d)(20) of the Act for such respective
conversion factor for such year. Under these provisions, the 2027
qualifying APM conversion factor represents a projected decrease of
$0.40 (-1.19 percent) from the current conversion factor of $33.4009.
Similarly, the 2027 nonqualifying APM conversion factor represents a
projected decrease of $0.56 (-1.68 percent) from the current conversion
factor of $33.5875.
For a detailed discussion of the economic impacts, see section
VII., Regulatory Impact Analysis, of this proposed rule.
II. Provisions of the Rule for the PFS
A. Background
In accordance with section 1848 of the Social Security Act (the
Act), CMS has paid for physicians' services under the Medicare
physician fee schedule (PFS) since January 1, 1992. The PFS relies on
national relative values that are established for work, practice
expense (PE), and malpractice (MP), which are adjusted for geographic
cost variations. These values are multiplied by a conversion factor
(CF) to convert the relative value units (RVUs) into payment rates. The
concepts and methodology underlying the PFS were enacted as part of the
Omnibus Budget Reconciliation Act of 1989 (OBRA '89) (Pub. L. 101-239,
December 19, 1989), and the Omnibus Budget Reconciliation Act of 1990
(OBRA '90) (Pub. L. 101-508, November 5, 1990). The final rule
published in the November 25, 1991 Federal Register (56 FR 59502) set
forth the first fee schedule used for Medicare payment for physicians'
services.
We note that throughout this proposed rule, unless otherwise noted,
the term ``practitioner'' is used to describe both physicians and
nonphysician practitioners (NPPs) who are permitted to bill Medicare
under the PFS for the services they furnish to Medicare beneficiaries.
B. Determination of PE RVUs
1. Overview
Practice expense (PE) is the portion of the resources used in
furnishing a service that reflects the general categories of physician
and practitioner expenses, such as office rent and personnel wages, but
excluding malpractice (MP) expenses, as specified in section
1848(c)(1)(B) of the Act. As required by section 1848(c)(2)(C)(ii) of
the Act, we use a resource-based system for determining PE RVUs for
each physicians' service. We develop PE RVUs by considering the direct
and indirect practice resources involved in furnishing each service.
Direct expense categories include clinical labor, medical supplies, and
medical equipment. Indirect expenses include administrative labor,
office expenses, and all other expenses. The sections that follow
provide more detailed information about the methodology for translating
the resources involved in furnishing each service into service specific
PE RVUs. We refer readers to the CY 2010 Physician Fee Schedule (PFS)
final rule with comment period (74 FR 61743 through 61748) for a more
detailed explanation of the PE methodology.
2. Practice Expense Methodology
a. Direct Practice Expense
We determine the direct PE for a specific service by adding the
costs of the direct resources (that is, the clinical staff, medical
supplies, and medical equipment) typically involved with furnishing
that service. The costs of the resources are calculated using the
refined direct PE inputs assigned to each CPT code in our PE database,
which are generally based on our review of recommendations received
from the American Medical Association (AMA)/Specialty Society Relative
Value Scale (RVS) Update Committee (referred to as the RUC) and those
provided in response to public comment periods. For a detailed
explanation of the direct PE methodology, including examples, we refer
readers to the 5-year review of work RVUs under the PFS and proposed
changes to the PE methodology in the CY 2007 PFS proposed rule (71 FR
37242) and the CY 2007 PFS final rule with comment period (71 FR
69629).
b. Indirect Practice Expense per Hour Data
We use survey data on indirect PEs incurred per hour (PE/HR) worked
to develop the indirect portion of the PE RVUs. Prior to CY 2010, we
primarily used the PE/HR by specialty obtained from the AMA's
Socioeconomic Monitoring System (SMS). The AMA administered a new
survey in CY 2007 and CY 2008, the Physician Practice Information
Survey (PPIS). The PPIS is a multispecialty, nationally representative,
PE survey of physicians and NPPs paid under the PFS using a survey
instrument and methods highly consistent with those used for the SMS
and the supplemental surveys. The PPIS gathered information from 3,656
respondents across 51 physician specialty and health care professional
groups. We have stated that we believe the PPIS is the most
comprehensive source of PE survey information available. We used the
PPIS data to update the PE/HR data for the CY 2010 PFS for almost all
of the Medicare-recognized specialties that participated in the survey.
When we began using the PPIS data in CY 2010, we did not change the
PE RVU methodology or how the PE/HR data are used. We only updated the
PE/HR data based on the new survey. Furthermore, as we explained in the
CY 2010 PFS final rule with comment period (74 FR 61751), because of
the magnitude of payment reductions for
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some specialties resulting from the use of the PPIS data, we
transitioned its use over a 4-year period from the previous PE RVUs to
the PE RVUs developed using the new PPIS data. As provided in the CY
2010 PFS final rule with comment period (74 FR 61751), the transition
to the PPIS data was complete for CY 2013. Therefore, PE RVUs from CY
2013 forward are developed based entirely on the PPIS data, except as
noted in this section.
Section 1848(c)(2)(H)(i) of the Act requires us to use the medical
oncology supplemental survey data submitted in 2003 for oncology drug
administration services. Therefore, the PE/HR for medical oncology,
hematology, and hematology/oncology reflects the continued use of these
supplemental survey data.
Supplemental survey data on independent labs from the College of
American Pathologists were implemented for payments beginning in CY
2005. Supplemental survey data from the National Coalition of Quality
Diagnostic Imaging Services (NCQDIS), representing independent
diagnostic testing facilities (IDTFs), were blended with supplementary
survey data from the American College of Radiology (ACR) and
implemented for payments beginning in CY 2007. Neither IDTFs nor
independent labs participated in the PPIS. Therefore, we continue to
use the PE/HR that was developed from their supplemental survey data.
Consistent with our past practice, the previous indirect PE/HR
values from the supplemental surveys for these specialties were updated
to CY 2006 using the Medicare Economic Index (MEI) to put them on a
comparable basis with the PPIS data.
We also do not use the PPIS data for reproductive endocrinology and
spine surgery since these specialties are not separately recognized by
Medicare, nor do we have a method to blend the PPIS data with Medicare-
recognized specialty data.
Previously, we established PE/HR values for various specialties
without SMS or supplemental survey data by crosswalking them to other
similar specialties to estimate a proxy PE/HR. For specialties that
were part of the PPIS for which we previously used a crosswalked PE/HR,
we instead used the PPIS based PE/HR. We use crosswalks for specialties
that did not participate in the PPIS. These crosswalks have been
generally established through notice and comment rulemaking and are
available in the file titled ``CY 2027 PFS proposed rule PE/HR'' on the
CMS website under downloads for the CY 2027 PFS proposed rule at
https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PhysicianFeeSched/PFS-Federal-Regulation-Notices.html.
c. Allocation of PE to Services
To establish PE RVUs for specific services, it is necessary to
establish the direct and indirect PE associated with each service.
(1) Direct Costs
The relative relationship between the direct cost portions of the
PE RVUs for any two services is determined by the relative relationship
between the sum of the direct cost resources (that is, the clinical
staff, medical supplies, and medical equipment) typically involved with
furnishing each of the services. The costs of these resources are
calculated from the refined direct PE inputs in our PE database. For
example, if one service has a direct cost sum of $400 from our PE
database and another service has a direct cost sum of $200, the direct
portion of the PE RVUs of the first service would be twice as much as
the direct portion of the PE RVUs for the second service.
(2) Indirect Costs
Under current policy, we allocate the indirect costs at the code
level based on the direct costs specifically associated with a code and
the greater of either the clinical labor costs or the work RVUs. We
also incorporate the survey data described earlier in the PE/HR
discussion. The general approach to developing the indirect portion of
the PE RVUs is as follows:
For a given service, we use the direct portion of the PE
RVUs calculated as previously described and the average percentage that
direct costs represent of total costs (based on survey data) across the
specialties that furnish the service to determine an initial indirect
allocator. That is, the initial indirect allocator is calculated so
that the direct costs equal the average percentage of direct costs of
those specialties furnishing the service. For example, if the direct
portion of the PE RVUs for a given service is 2.00 and direct costs, on
average, represent 25 percent of total costs for the specialties that
furnish the service, the initial indirect allocator would be calculated
so that it equals 75 percent of the total PE RVUs. Thus, in this
example, the initial indirect allocator would equal 6.00, resulting in
a total PE RVU of 8.00 (2.00 is 25 percent of 8.00 and 6.00 is 75
percent of 8.00).
Next, under current policy, we add the greater of the work
RVUs or clinical labor portion of the direct portion of the PE RVUs to
this initial indirect allocator. In our example, if this service had a
work RVU of 4.00 and the clinical labor portion of the direct PE RVU
was 1.50, we would add 4.00 (since the 4.00 work RVUs are greater than
the 1.50 clinical labor portion) to the initial indirect allocator of
6.00 to get an indirect allocator of 10.00. In the absence of any
further use of the survey data, the relative relationship between the
indirect cost portions of the PE RVUs for any two services would be
determined by the relative relationship between these indirect cost
allocators. For example, if one service had an indirect cost allocator
of 10.00 and another service had an indirect cost allocator of 5.00,
the indirect portion of the PE RVUs of the first service would be twice
as great as the indirect portion of the PE RVUs for the second service.
Then, we incorporate the specialty specific indirect PE/HR
data into the calculation. In our example, if, based on the survey
data, the average indirect cost of the specialties furnishing the first
service with an allocator of 10.00 was half of the average indirect
cost of the specialties furnishing the second service with an indirect
allocator of 5.00, the indirect portion of the PE RVUs of the first
service would be equal to that of the second service.
In the CY 2007 PFS final rule with comment period, we implemented
the ``bottom up'' methodology for the development of PE RVUs (71 FR
69630-69643). We finalized the use of the work RVU or the clinical
labor portion of the direct PE RVU, whichever is greater, to allocate
indirect costs. We also finalized a modified formula for a global
service (that is, a service with a professional component (PC) and a
technical component (TC)) to utilize both the work RVU and the clinical
labor PE RVU to allocate indirect costs. As noted in the CY 2007 PFS
final rule with comment period, we do this to recognize that, for the
PC service, indirect PEs will be allocated using the work RVUs, and for
the TC service, indirect PEs will be allocated using the direct PE RVU
and the clinical labor PE RVU. This also allows the global component
RVUs to equal the sum of the PC and TC RVUs.
In recent years, as we have conducted analyses aimed at improving
the accuracy of payment under the PFS, we have re-examined this
longstanding policy that effectively allocates a larger share of
indirect PE RVUs to services that can be reported using technical,
professional, and global components than to those that cannot. We refer
the reader to a report by RAND Corporation, under contract with CMS,
which addresses several approaches to improving the accuracy of other
PFS
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services relative to services that have a professional and technical
component. This report is available at https://www.rand.org/pubs/research_reports/RRA4720-2.html.
This longstanding policy inadvertently advantages services that can
be reported using technical, professional, and global components,
referred to as ``triplet services'' in the report by RAND Corporation,
because indirect PE RVUs are allocated on the sum, whereas services
that can only be reported as a global service, referred to as ``non-
triplet services'' in the report, depend on the maximum (rather than
sum) of clinical labor PE RVUs and physician work RVUs. This is an
unintended advantage of the arithmetic required for the global
component RVUs to equal the sum of the PC and TC RVUs. We believe it
would be more accurate than the current PE methodology to use the same
allocation methodology for all PFS services. Therefore, we are
proposing to allocate indirect PE using both the work RVU and the
clinical labor RVU for all services, with the exception of codes with
010- and 090-day global periods, instead of just applying that
methodology to those services that can be reported using technical,
professional, and global components (typically diagnostic and imaging
services). In the description of the calculation of the PE methodology
below, we indicate the portion of the methodology that would be
calculated differently under this proposal.
(3) Facility and Non-Facility Costs
For procedures that can be furnished in a physician's office, as
well as in a facility setting, where Medicare makes a separate payment
to the facility for its costs in furnishing a service, we establish two
PE RVUs: facility and non-facility. The methodology for calculating PE
RVUs is generally the same for both the facility and non-facility RVUs
but is applied independently to yield two separate PE RVUs. In
calculating the PE RVUs for services furnished in a facility, we do not
include resources that would generally not be provided by physicians
when furnishing the service. For this reason, the facility PE RVUs are
generally lower than the non-facility PE RVUs. In the CY 2026 PFS final
rule (90 FR 49292-49296), we finalized a modification in the allocation
of indirect PE to reduce the portion of the facility PE RVUs allocated
based on work RVUs to half the amount allocated to non-facility PE RVUs
beginning in CY 2026.
(4) Services With Technical Components and Professional Components
Diagnostic services are generally comprised of two components: a
professional component (PC); and a technical component (TC). The PC and
TC may be furnished independently or by different healthcare providers,
or they may be furnished together as a global service. When services
have separately billable PC and TC components, the payment for the
global service equals the sum of the payment for the TC and PC. To
achieve this, we use a weighted average of the ratio of indirect to
direct costs across all the specialties that furnish the global
service, TCs, and PCs; that is, we apply the same weighted average
indirect percentage factor to allocate indirect expenses to the global
service, PCs, and TCs for a service. (The direct PE RVUs for the TC and
PC sum to the global direct PE RVUs.)
(5) PE RVU Methodology
For a more detailed description of the PE RVU methodology, we
direct readers to the CY 2010 PFS final rule with comment period (74 FR
61745 through 61746). We also direct readers to the file titled
``Calculation of PE RVUs under Methodology for Selected Codes'' which
is available on our website under downloads for the CY 2027 PFS
proposed rule at https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PhysicianFeeSched/PFS-Federal-Regulation-Notices.html. This
file contains a table that illustrates the calculation of PE RVUs as
described in this proposed rule for individual codes.
(a) Setup File
First, we create a setup file for the PE methodology. The setup
file contains the direct cost inputs, the utilization for each
procedure code at the specialty and facility/non-facility place of
service level, and the specialty specific PE/HR data calculated from
the surveys.
(b) Calculate the Direct Cost PE RVUs
Sum the costs of each direct input.
Step 1: Sum the direct costs of the inputs for each service.
Step 2: Calculate the aggregate pool of direct PE costs for the
current year. We set the aggregate pool of PE costs equal to the
product of the ratio of the current aggregate PE RVUs to current
aggregate work RVUs and the projected aggregate work RVUs.
Step 3: Calculate the aggregate pool of direct PE costs for use in
ratesetting. This is the product of the aggregate direct costs for all
services from Step 1 and the utilization data for that service.
Step 4: Using the results of Step 2 and Step 3, use the CF to
calculate a direct PE scaling adjustment to ensure that the aggregate
pool of direct PE costs calculated in Step 3 does not vary from the
aggregate pool of direct PE costs for the current year. Apply the
scaling adjustment to the direct costs for each service (as calculated
in Step 1).
Step 5: Convert the results of Step 4 to an RVU scale for each
service. To do this, divide the results of Step 4 by the CF. Note that
the actual value of the CF used in this calculation does not influence
the final direct cost PE RVUs as long as the same CF is used in Step 4
and Step 5. Different CFs would result in different direct PE scaling
adjustments, but this has no effect on the final direct cost PE RVUs
since changes in the CFs and the associated direct scaling adjustments
offset one another.
(c) Create the Indirect Cost PE RVUs
Create indirect allocators.
Step 6: Based on the survey data, calculate direct and indirect PE
percentages for each physician specialty.
Step 7: Calculate direct and indirect PE percentages at the service
level by taking a weighted average of the results of Step 6 for the
specialties that furnish the service. Note that for services with TCs
and PCs, the direct and indirect percentages for a given service do not
vary by the PC, TC, and global service.
We generally use an average of the 3 most recent years of available
Medicare claims data to determine the specialty mix assigned to each
code. Codes with low Medicare service volume require special attention
since billing or enrollment irregularities for a given year can result
in significant changes in specialty mix assignment. We finalized a
policy in the CY 2018 PFS final rule (82 FR 52982 through 52983) to use
the most recent year of claims data to determine which codes are low
volume for the coming year (those that have fewer than 100 allowed
services in the Medicare claims data). For codes that fall into this
category, instead of assigning a specialty mix based on the specialties
of the practitioners reporting the services in the claims data, we use
the expected specialty that we identify on a list developed based on
medical review and input from expert interested parties. We display
this list of expected specialty assignments as part of the annual set
of data files we make available as part of notice and comment
rulemaking and consider recommendations from the RUC and other
interested parties on changes to this list annually. Services for which
the
[[Page 43847]]
specialty is automatically assigned based on previously finalized
policies under our established methodology (for example, ``always
therapy'' services) are unaffected by the list of expected specialty
assignments. We also finalized in the CY 2018 PFS final rule (82 FR
52982 through 52983) a policy to apply these service-level overrides
for both PE and MP, rather than one or the other category.
In prior years, we reviewed information submitted during the
proposed rule comment period regarding potential additions to the list
of expected specialty assignments, to determine whether the specialty
assignments commenters recommended were appropriate for the services in
question. Our review process has been based on determining if the
recommended specialty matched the dominant specialty in the claims
data. However, we have long held reservations on whether this was the
most accurate method for implementing updates to the expected specialty
assignments list. Since these updates to the list were never formally
proposed in the proposed rule of each calendar year, there was never an
opportunity for interested parties to comment and provide feedback
before the assignments were finalized in the final rule. We believe
that it would provide greater transparency and more opportunities for
public comment if additions to the expected specialty assignments list
were instead proposed in each year's proposed rule.
Therefore, we did not finalize any additions to the expected
specialty assignments list in the CY 2026 PFS final rule (90 FR 49270).
We stated that we would instead review the list of approximately 75 low
volume HCPCS codes submitted by commenters and propose additions to the
list in this year's CY 2027 PFS proposed rule. We will also review any
submissions for inclusion to the expected specialty assignments list by
the same February 10th deadline that we have finalized in the past for
consideration of RUC recommendations and invoice-based updates to
supply and equipment pricing. We believe that synchronizing submissions
to the expected specialty assignments list for low volume services with
the same annual date used for RUC recommendations and invoice
submissions will help standardize the process, while also providing
more opportunities for feedback from interested parties by going
through the annual comment process.
During the comment period for the CY 2026 PFS rule, several
commenters stated that they had performed an analysis to identify all
codes that meet the criteria to receive a specialty override under this
CMS policy and drafted updated recommendations for codes that meet
these criteria. Commenters stated that the purpose of assigning a
specialty to these codes was to avoid the significant adverse impact on
MP RVUs that results from errors in specialty utilization data
magnified in representation (percentage) by small sample size. These
commenters submitted a list of approximately 75 low volume HCPCS codes
with recommended expected specialty assignments.
After reviewing the information provided by the commenters to
determine whether the specialty assignments they recommended were
appropriate for the services in question, based on determining if the
recommended specialty matches the dominant specialty in the claims
data, we are proposing the additions to the list of expected specialty
assignments for low volume services identified in Table A-B1. We agree
with the commenters that, based on claims data, CPT codes 33277 through
33281 and 33287 through 33288 should be crosswalked to the Cardiac
Electrophysiology specialty and that CPT codes 93584 through 93588
should be crosswalked to the Interventional Cardiology specialty. We
also agree with commenters that CPT code 23077 should be crosswalked to
the Surgical Oncology specialty. However, we do not have PE/HR data for
these specialties as they were not part of the PPIS when it was
conducted in 2007; therefore, we are crosswalking these CPT codes to
the closest available specialties (Cardiology for the first two groups
of codes and All Physicians for CPT code 23077), as listed on Table A-
B1.
We disagree with the commenters on a series of additional suggested
assigned specialties. In each case, there was another specialty which
was reported more than twice as often in the claims data as the
specialty suggested by commenters and in some cases reported as much as
five times as often. Therefore, we are crosswalking CPT codes 15135 and
41000 to the Otolaryngology specialty, CPT codes 26118 and 26650 to the
Orthopedic Surgery specialty, CPT codes 93025 and 93150 to the
Cardiology specialty, and CPT codes 93152 and 93153 to the Pulmonary
Disease specialty as these were the dominant specialties in the claims
data. These crosswalks are included in Table A-B1.
BILLING CODE 4169-69-P
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[GRAPHIC] [TIFF OMITTED] TP16JY26.010
[[Page 43849]]
[GRAPHIC] [TIFF OMITTED] TP16JY26.011
BILLING CODE 4169-69-C
The full list of expected specialty assignments is included in the
CY 2027 public use files, which are available on the CMS website under
downloads for the CY 2027 PFS proposed rule at http://www.cms.gov/Medicare/Medicare-Fee-for-ServicePayment/PhysicianFeeSched/PFS-Federal-Regulation-Notices.html.
Step 8: Calculate the service level allocators for the indirect PEs
based on the percentages calculated in Step 7. The indirect PEs are
allocated based on the three components: the direct PE RVUs; the
clinical labor PE RVUs; and the work RVUs.
Under current policy, for most services the indirect allocator is:
indirect PE percentage * (direct PE RVUs/direct percentage) + work
RVUs.
There are two situations where this formula is modified:
If the service is a global service (that is, a service
with global, professional, and technical components), then the indirect
PE allocator is: indirect percentage (direct PE RVUs/direct percentage)
+ clinical labor PE RVUs + work RVUs.
If the clinical labor PE RVUs exceed the work RVUs (and
the service is not a global service), then the indirect allocator is:
indirect PE percentage (direct PE RVUs/direct percentage) + clinical
labor PE RVUs.
(Note: Under current policy, for global services, the indirect PE
allocator is based on both the work RVUs and the clinical labor PE
RVUs. We do this to recognize that, for the PC service, indirect PEs
would be allocated using the work RVUs, and for the TC service,
indirect PEs would be allocated using the direct PE RVUs and the
clinical labor PE RVUs. This also allows the global component RVUs to
equal the sum of the PC and TC RVUs.)
For presentation purposes, in the examples in the download file
titled ``Calculation of PE RVUs under Methodology for Selected Codes'',
the formulas were divided into two parts for each service.
The first part does not vary by service and is the
indirect percentage (direct PE RVUs/direct percentage).
Under current policy, the second part is either the work
RVU, clinical labor PE RVU, or both depending on whether the service is
a global service and whether the clinical PE RVUs exceed the work RVUs
(as described earlier in this step).
We note that for CY 2026, we finalized a change to the methodology
so that when work RVUs are used to allocate indirect PE to the facility
RVUs, they are assigned at one-half the amount allocated to the non-
facility PE RVUs for that same service. These PE methodology changes
are discussed in greater detail in the CY 2026 PFS final rule (90 FR
49292 through 49296).
Proposed Step 8: Calculate the service level allocators for the
indirect PEs based on the percentages calculated in Step 7. The
indirect PEs are allocated based on the three components: the direct PE
RVUs; the clinical labor PE RVUs; and the work RVUs.
The proposed indirect allocator is: indirect PE percentage *(direct
PE RVUs/direct percentage) + work RVUs + clinical labor RVUs. The
proposed change is to include both the work RVUs and clinical labor
RVUs in the indirect allocator for all services, except for codes with
010- and 090-day global periods, as opposed to including the
[[Page 43850]]
work RVUs and clinical labor RVUs only for global services as detailed
above.
If this proposed policy were to be finalized, this Proposed Step 8
would replace the Step 8 listed earlier. For presentation purposes, in
the examples in the download file titled ``Calculation of PE RVUs under
Methodology for Selected Codes,'' the formulas were divided into two
parts for each service.
The first part is the indirect percentage (direct PE RVUs/
direct percentage).
The second part is the sum of the work RVU and the
clinical labor PE RVU, including the methodology change finalized in CY
2026 for services performed in the facility setting (when work RVUs are
used to allocate indirect PE to the facility RVUs, they are assigned at
one-half the amount allocated to the non-facility PE RVUs for that same
service).
Apply a scaling adjustment to the indirect allocators.
Step 9: Calculate the current aggregate pool of indirect PE RVUs by
multiplying the result of step 8 by the average indirect PE percentage
from the survey data.
Step 10: Calculate an aggregate pool of indirect PE RVUs for all
PFS services by adding the product of the indirect PE allocators for a
service from Step 8 and the utilization data for that service.
Step 11: Using the results of Step 9 and Step 10, calculate an
indirect PE adjustment so that the aggregate indirect allocation does
not exceed the available aggregate indirect PE RVUs and apply it to
indirect allocators calculated in Step 8.
Under current policy, calculate the indirect practice cost index
(IPCI). We refer readers to the CY 2007 PFS final rule with comment
period (71 FR 69633) for more information about the establishment of
the IPCI.
Step 12: Using the results of Step 11, calculate aggregate pools of
specialty specific adjusted indirect PE allocators for all PFS services
for a specialty by adding the product of the adjusted indirect PE
allocator for each service and the utilization data for that service.
Step 13: Using the specialty specific indirect PE/HR data,
calculate specialty specific aggregate pools of indirect PE for all PFS
services for that specialty by adding the product of the indirect PE/HR
for the specialty, the work time for the service, and the specialty's
utilization for the service across all services furnished by the
specialty.
Step 14: Using the results of Step 12 as the denominator and Step
13 as the numerator, calculate the specialty specific indirect PE
scaling factors.
Step 15: Using the results of Step 14, calculate an indirect
practice cost index at the specialty level by dividing each specialty
specific indirect scaling factor by the average indirect scaling factor
for the entire PFS.
Step 16: Calculate the indirect practice cost index at the service
level to ensure the capture of all indirect costs. Calculate a weighted
average of the practice cost index values for the specialties that
furnish the service. (Note: For services with TCs and PCs, we calculate
the indirect practice cost index across the global service, PCs, and
TCs. Under this method, the indirect practice cost index for a given
service (for example, echocardiogram) does not vary by the PC, TC, and
global service.)
Step 17: Apply the service level indirect practice cost index
calculated in Step 16 to the service level adjusted indirect allocators
calculated in Step 11 to get the indirect PE RVUs.
Proposal regarding Steps 12 through 17: We develop the indirect
practice expense (PE) RVUs under the PFS to reflect the relative
resources involved in furnishing the services. Since the implementation
of the resource-based PE RVUs, we have assumed that aggregate specialty
level practice costs derived primarily from the 2007 PE/HR survey data
are a reasonable way to help establish the resource-based indirect PE
RVUs. We have historically used that data both to allocate indirect
costs to each code and to re-scale the resulting PE RVUs for each code
at the end of the established methodology to ensure that the overall
allocation of PE RVUs for each specialty across the PFS approximates
those expected based on the index derived from the PE/HR survey data.
Over time, however, we have identified various limitations of the
survey data, especially as the data we use has become increasingly
dated and are intrinsically limited to small, selective samples based
on pre-determined assumptions about where costs are likely to differ,
and, as we addressed in CY 2026 PFS rulemaking, have not been
adequately updated. (We refer readers to an extended discussion of our
concerns with and decision not to update this data in the CY 2026 PFS
final rule at 90 FR 49286 through 49292.) This has resulted in a PE
methodology that privileges the historic survey data over incorporation
of more recent data about specific services and produces unpredictable
and counterintuitive results that are not transparent to the public.
Because we have taken various steps to improve the data used in the
pricing inputs and the indirect allocation methodologies, we are
proposing to remove the steps of the current methodology that rely on
the indirect practice cost index (IPCI) from the calculation of the PE
RVUs. We propose this change, because the steps of the current
methodology that rely on the IPCI calculation effectively favor the
aggregate specialty-level survey data over the code level inputs and
allocators and consequently limit the influence of improvements to
inputs and allocation methodologies. We are proposing to implement this
change over a 2-year transition period. Specifically, in the first
year, only half of the measured variation in the IPCI will be applied
to the indirect allocator. In the second year, the IPCI will no longer
be applied.
The steps of the current methodology that rely on the IPCI
calculation are steps 12 through 17. Thus, under this proposal, steps
12 through 17 would no longer be a part of the calculation, and the
total PE RVU, prior to the calculation of final PE RVUs described below
at Step 18, would be the sum of step 5 (Direct Cost PE RVUs) and step
11 (Indirect Cost PE RVUs).
(d) Calculate the Final PE RVUs
Step 18: Under current policy, add the direct PE RVUs from Step 5
to the indirect PE RVUs from Step 17 and apply the final PE budget
neutrality (BN) adjustment. The final PE BN adjustment is calculated by
comparing the sum of steps 5 and 17 to the aggregate work RVUs scaled
by the ratio of current aggregate PE and work RVUs. This adjustment
ensures that all PE RVUs in the PFS account for the fact that certain
specialties are excluded from the calculation of PE RVUs but included
in maintaining overall PFS BN. (See ``Specialties excluded from
ratesetting calculation'' later in this proposed rule). Under the
proposed policy, add the direct cost PE RVUs from Step 5 to the
indirect cost PE RVUs from Step 11 and apply the final PE BN
adjustment.
Proposed Step 19: Calculate and apply the PE stabilization factor
for each PE RVU by comparing the result of step 18 with the results of
the prior year's PE RVUs from step 18. As described previously in this
section, we are proposing to remove the IPCI from the PE methodology,
which we believe will improve the transparency and stability of PE RVUs
over time. However, we recognize that the IPCI, because it is rooted in
static PE/HR data, effectively resulted in stabilizing year-to-year
changes in PE RVUs, especially due to changes in input valuations and
changes to allocation methodologies. We have long noted that extreme
volatility in PE RVUs can have
[[Page 43851]]
unintended consequences and distortions. To mitigate volatility that
could otherwise occur, we are proposing a PE stabilization adjustment
to further improve predictability and reduce volatility within the PE
RVUs. Specifically, we are proposing that the PE RVU calculated after
the application of the cognitive services floor and any adjustments
that occur outside of the PE methodology will be subject to a cap and
will not increase or decrease by more than 5 percent each year. In the
proposed Step 19 we would compare the PE RVU after the application of
the cognitive services floor and any code-level adjustments in the
current ratesetting year to the allocation methodology from the prior
year and then apply the 5 percent cap. We note that the proposed
stabilization adjustment in Proposed Step 19 will be applied prior to
the statutory phase-in of significant RVU reductions required by
Section 1848(c)(7) of the Act, discussed in more detail later in this
section, which limits all codes that are not new or revised to a 19
percent decrease in total RVU in an individual calendar year.
Therefore, a code may be impacted by both the PE stabilization
adjustment and the statutory phase-in, meaning a code's PE RVU may
ultimately differ by greater than the PE stabilization adjustment
detailed in proposed Step 19.
This proposed adjustment would not apply to new and revised codes
or codes formerly contractor priced that are newly nationally priced,
because it is not clear what the comparison PE RVU would be for those
codes. Because we believe the benefits of the PE stabilization
adjustment would ideally apply to new and revised codes and newly
nationally priced codes, we are seeking comment on an approach that
would allow us to expand the PE stabilization adjustment to these
categories of codes. Additionally, the proposed PE stabilization
adjustment would not apply to revalued codes because we believe the
statutory phase-in sufficiently limits large reductions to individual
codes undergoing review and/or revaluation, and limits the amount of
time a revalued code would remain overvalued by being significantly
constrained from reductions found to be appropriate through
revaluation.
Step 19 (under our proposal, step 19 would be renumbered as step
20): Apply the phase-in of significant RVU reductions and its
associated adjustment. Section 1848(c)(7) of the Act specifies that for
services that are not new or revised codes, if the total RVUs for a
service for a year would otherwise be decreased by an estimated 20
percent or more as compared to the total RVUs for the previous year,
the applicable adjustments in work, PE, and MP RVUs must be phased in
over a 2-year period. In implementing the phase-in, we consider a 19
percent reduction as the maximum 1-year reduction for any service not
described by a new or revised code. This approach limits the year 1
reduction for the service to the maximum allowed amount (that is, 19
percent), and then phases in the remainder of the reduction. To comply
with section 1848(c)(7) of the Act, we adjust the PE RVUs to ensure
that the total RVUs for all services that are not new or revised codes
decrease by no more than 19 percent, and then apply a relativity
adjustment to ensure that the total pool of aggregate PE RVUs remains
relative to the pool of work and MP RVUs. For a more detailed
description of the methodology for the phase-in of significant RVU
changes, we refer readers to the CY 2016 PFS final rule with comment
period (80 FR 70927 through 70931).
In summary, for CY 2027, we are proposing to:
Modify step 8 to calculate indirect PE based on both work
RVUs and clinical labor RVUs for all services except 010- and 090-day
global period codes;
Remove steps 12 through 17 that rely on the IPCI from the
calculation of the PE RVUs over a 2-year transition period, and;
Add a new step to apply a stabilization adjustment to the
PE RVUs (proposed step 19).
(e) Setup File Information
Specialties excluded from ratesetting calculation: To
calculate the PE and MP RVUs, we exclude certain specialties, such as
NPPs paid at a percentage of the PFS and low volume specialties, from
the calculation. These specialties are included to calculate the BN
adjustment. They are displayed in Table A-B2.
[[Page 43852]]
[GRAPHIC] [TIFF OMITTED] TP16JY26.012
Crosswalk certain low volume physician specialties:
Crosswalk the utilization of certain specialties with relatively low
PFS utilization to the associated specialties.
Physical therapy utilization: Crosswalk the utilization
associated with all physical therapy services to the specialty of
physical therapy.
Identify professional and technical services not
identified under the usual technical component (TC) and professional
component (PC or 26) modifiers: Flag the services that are PC and TC
services but do not use TC and PC/26 modifiers (for example,
electrocardiograms). This flag associates the PC and TC with the
associated global code for use in creating the indirect PE RVUs. For
example, the professional service, CPT code 93010 (Electrocardiogram,
routine ECG with at least 12 leads; interpretation and report only), is
associated with the global service, CPT code 93000 (Electrocardiogram,
routine ECG with at least 12 leads; with interpretation and report).
Payment modifiers: In the CY 2013 PFS proposed rule (77 FR
68901), we introduced a more detailed methodology for adjusting volume
and time to account for payment modifiers and other special payment
rules, such as multiple procedure payment reductions, in the
utilization data. We are proposing that, beginning in CY 2027, we would
utilize a new approach to account for payment modifiers and other
special payment rules. For each paid claim line, we would calculate the
ratio of allowed charges to the national PFS payment amount. This would
account for differences resulting from payment modifiers and other
special payment rules, as well as differences in geography. We are
proposing to use the same ratio to adjust time, rather than a separate
calculation under our current methodology, with the exception of
anesthesia, for which we calculate time using only procedures with
modifiers indicating they are personally performed. These proposed
changes will
[[Page 43853]]
allow us to more accurately capture any combination of modifiers and
special payment rules and automatically account for updates in
modifiers and/or special payment rules in future years. These proposed
changes have a very minimal impact on the resulting PE RVUs but will
produce a more accurate result. As under our current methodology, the
adjusted volume will be displayed in the utilization file that is
posted in conjunction with each PFS rule.
Work RVUs: The setup file contains the work RVUs from this
proposed rule.
(6) Equipment Cost per Minute
The equipment cost per minute is calculated as:
(1/(minutes per year * usage)) * price * ((interest rate/( 1 (1/((1 +
interest rate)- life of equipment)))) + maintenance)
Where:
minutes per year = maximum minutes per year if usage were continuous
(that is, usage = 1); generally, 150,000 minutes.
usage = variable, see discussion later in this proposed rule.
price = price of the particular piece of equipment.
life of equipment = useful life of the particular piece of
equipment.
maintenance = factor for maintenance; 0.05.
interest rate = variable, see discussion later in this proposed
rule.
Usage: We currently use an equipment utilization rate assumption of
50 percent for most equipment, with the exception of expensive
diagnostic imaging equipment, for which we use a 90 percent assumption
as required by section 1848(b)(4)(C) of the Act.
Useful Life: In the CY 2005 PFS final rule we stated that we
updated the useful life for equipment items primarily based on the
AHA's ``Estimated Useful Lives of Depreciable Hospital Assets''
guidelines (69 FR 66246). The most recent edition of these guidelines
was published in 2018. This reference material provides an estimated
useful life for hundreds of different types of equipment, the vast
majority of which fall in the range of 5 to 10 years, and none of which
are lower than 2 years in duration. We believe that the updated
editions of this reference material remain the most accurate source for
estimating the useful life of depreciable medical equipment.
In the CY 2021 PFS final rule, (85 FR 84482 through 84483) we
finalized a proposal to treat equipment life durations of less than 1
year as having a duration of 1 year for the purpose of our equipment
price per minute formula. In the rare cases where items are replaced
every few months, we noted that we believe it is more accurate to treat
these items as disposable supplies with a fractional supply quantity as
opposed to equipment items with very short equipment life durations.
For a more detailed discussion of the methodology associated with very
short equipment life durations, we refer readers to the CY 2021 PFS
final rule (85 FR 84482 through 84483).
Maintenance: We finalized the 5 percent factor for annual
maintenance in the CY 1998 PFS final rule with comment period (62 FR
33164). As we previously stated in the CY 2016 PFS final rule with
comment period (80 FR 70897), we do not believe the annual maintenance
factor for all equipment is precisely 5 percent, and we concur that the
current rate likely understates the true cost of maintaining some
equipment. We also noted that we believe it likely overstates the
maintenance costs for other equipment. When we solicited comments
regarding data sources containing equipment maintenance rates,
commenters could not identify an auditable, robust data source that CMS
could use on a wide scale. We noted that we did not believe voluntary
submissions regarding the maintenance costs of individual equipment
items would be an appropriate methodology for determining costs. As a
result, in the absence of publicly available datasets regarding
equipment maintenance costs or another systematic data collection
methodology for determining a different maintenance factor, in the
proposed rule, we did not propose a variable maintenance factor for
equipment cost per minute pricing as we did not believe that we have
sufficient information at present. We noted in the CY 2026 PFS proposed
rule (90 FR 32593) that we would continue to investigate potential
avenues for determining equipment maintenance costs across a broad
range of equipment items.
Interest Rate: In the CY 2013 PFS final rule with comment
period (77 FR 68902), we updated the interest rates used in developing
an equipment cost per minute calculation (see 77 FR 68902 for a
thorough discussion of this issue). The interest rate was based on the
Small Business Administration (SBA) maximum interest rates for
different categories of loan size (equipment cost) and maturity (useful
life). The interest rates are listed in Table A-B3.
[GRAPHIC] [TIFF OMITTED] TP16JY26.013
We are not proposing any changes to the equipment interest rates
for CY 2027.
3. Adjusting RVUs To Match the PE Share of the Medicare Economic Index
(MEI)
We have long stated that we believe that the MEI is the best
measure available to determine the relative weights of the three
components in payments under the PFS--work, practice expense (PE), and
malpractice (MP). Accordingly, we believe that to ensure that the PFS
payments reflect the relative resources in each of these PFS components
as required by section 1848(c)(3) of the Act, the RVUs used in
developing rates should reflect the same weights in each component as
the cost share weights in the Medicare Economic Index (MEI).
Accordingly, we have finalized to accomplish this (78 FR 74241 through
74242) by holding the work RVUs constant and adjusting the PE RVUs, MP
RVUs, and conversion factor (CF) to produce the appropriate balance in
RVUs among the three PFS
[[Page 43854]]
components and payment rates for individual services, that is, that the
total RVUs on the PFS are proportioned to approximately 51 percent work
RVUs, 45 percent PE RVUs, and 4 percent MP RVUs. Historically, as the
MEI cost shares are updated, we have proposed to modify steps 3 and 10
to adjust the aggregate pools of PE costs (direct PE in step 3 and
indirect PE in step 10) in proportion to the change in the PE share in
the MEI cost share weights, and to recalibrate the relativity
adjustment that we apply in step 18 as described in the CY 2023 PFS
final rule (87 FR 69414 and 69415) and CY 2014 PFS final rule (78 FR
74236 and 74237). The most recent recalibration was done for the CY
2014 RVUs.
However, due to overarching concerns with the data as described in
the CY 2026 PFS final rule (90 FR 49287 through 49293) and our
previously described policy goal to balance PFS payment stability and
predictability with incorporating new data through routine updates to
the MEI, we finalized our proposal to maintain the current PE/HR and
2006-based MEI cost shares (rather than transitioning to the 2017-based
MEI cost shares), for CY 2026 PFS ratesetting due to the concerns about
data quality and payment stability. Additionally, for CY 2027, we are
proposing to continue to use the current PE/HR and 2006-based MEI cost
shares for CY 2027 PFS ratesetting.
4. Changes to Direct PE Inputs for Specific Services
This section focuses on specific PE inputs. The direct PE inputs
are included in the CY 2027 direct PE input public use files, which are
available on the CMS website under downloads for the CY 2027 PFS
proposed rule at https://www.cms.gov/Medicare/Medicare-Fee-fafor-Service-Payment/PhysicianFeeSched/PFS-Federal-Regulation-Notices.html.
a. Standardization of Clinical Labor Tasks
As we noted in the CY 2015 PFS final rule with comment period (79
FR 67640 through 67641), we continue to make improvements to the direct
PE input database to provide the number of clinical labor minutes
assigned for each task for every code in the database instead of only
including the number of clinical labor minutes for the preservice,
service, and post service periods for each code. In addition to
increasing the transparency of the information used to set PE RVUs,
this level of detail would allow us to compare clinical labor times for
activities associated with services across the PFS, which we believe is
important to maintaining the relativity of the direct PE inputs. This
information would facilitate the identification of the usual numbers of
minutes for clinical labor tasks and the identification of exceptions
to the usual values. It would also allow for greater transparency and
consistency in the assignment of equipment minutes based on clinical
labor times. Finally, we believe that the detailed information can be
useful in maintaining standard times for particular clinical labor
tasks that can be applied consistently to many codes as they are valued
over several years, similar in principle to physician preservice time
packages. We believe that setting and maintaining such standards would
provide greater consistency among codes that share the same clinical
labor tasks and could improve the relativity of values among codes. For
example, as medical practice and technologies change over time,
standards could be updated simultaneously for all codes with the
applicable clinical labor tasks instead of waiting for individual codes
to be reviewed.
In the CY 2016 PFS final rule with comment period (80 FR 70901), we
solicited comments on the appropriate standard minutes for the clinical
labor tasks associated with services that use digital technology. After
consideration of comments received, we finalized standard times for
clinical labor tasks associated with digital imaging at 2 minutes for
``Availability of prior images confirmed'', 2 minutes for ``Patient
clinical information and questionnaire reviewed by technologist, order
from physician confirmed and exam protocoled by radiologist'', 2
minutes for ``Review examination with interpreting MD'', and 1 minute
for ``Exam documents scanned into PACS'' and ``Exam completed in RIS
system to generate billing process and to populate images into
Radiologist work queue.'' In the CY 2017 PFS final rule (81 FR 80184
through 80186), we finalized a policy to establish a range of
appropriate standard minutes for the clinical labor activity,
``Technologist QCs images in PACS, checking for all images, reformats,
and dose page.'' These standard minutes will be applied to new and
revised codes that make use of this clinical labor activity when they
are reviewed by us for valuation. We finalized a policy to establish 2
minutes as the standard for the simple case, 3 minutes as the standard
for the intermediate case, 4 minutes as the standard for the complex
case, and 5 minutes as the standard for the highly complex case. These
values were based upon a review of the existing minutes assigned for
this clinical labor activity; we determined that 2 minutes is the
duration for most services and a small number of codes with more
complex forms of digital imaging have higher values. We also finalized
standard times for a series of clinical labor tasks associated with
pathology services in the CY 2016 PFS final rule with comment period
(80 FR 70902). We do not believe these activities would be dependent on
the number of blocks or batch size, and we believe that the finalized
standard values accurately reflect the typical time it takes to perform
these clinical labor tasks.
In reviewing the RUC-recommended direct PE inputs for CY 2019, we
noticed that the 3 minutes of clinical labor time traditionally
assigned to the ``Prepare room, equipment and supplies'' (CA013)
clinical labor activity were split into 2 minutes for the ``Prepare
room, equipment and supplies'' activity and 1 minute for the ``Confirm
order, protocol exam'' (CA014) activity. We proposed to maintain the 3
minutes of clinical labor time for the ``Prepare room, equipment and
supplies'' activity and remove the clinical labor time for the
``Confirm order, protocol exam'' activity wherever we observed this
pattern in the RUC-recommended direct PE inputs. Commenters explained
in response that when the new version of the PE worksheet introduced
the activity codes for clinical labor, there was a need to translate
old clinical labor tasks into the new activity codes, and that a prior
clinical labor task was split into two of the new clinical labor
activity codes: CA007 (Review patient clinical extant information and
questionnaire) in the preservice period, and CA014 (Confirm order,
protocol exam) in the service period. Commenters stated that the same
clinical labor from the old PE worksheet was now divided into the CA007
and CA014 activity codes, with a standard of 1 minute for each
activity. We agreed with commenters that we would finalize the RUC-
recommended 2 minutes of clinical labor time for the CA007 activity
code and 1 minute for the CA014 activity code in situations where this
was the case. However, when reviewing the clinical labor for the
reviewed codes affected by this issue, we found that several of the
codes did not include this old clinical labor task, and we also noted
that several of the reviewed codes that contained the CA014 clinical
labor activity code did not contain any clinical labor for the CA007
activity. In these situations, we believe that the three total minutes
of
[[Page 43855]]
clinical staff time would be more accurately described by the CA013
``Prepare room, equipment and supplies'' activity code, and we
finalized these clinical labor refinements. We direct readers to the
discussion in the CY 2019 PFS final rule (83 FR 59463 through 59464)
for additional details.
Following the publication of the CY 2020 PFS proposed rule, a
commenter expressed concern with the published list of common
refinements to equipment time. The commenter stated that these
refinements were the formulaic result of applying refinements to the
clinical labor time and did not constitute separate refinements; the
commenter requested that CMS no longer include these refinements in the
table published each year. In the CY 2020 PFS final rule, we agreed
with the commenter that these equipment time refinements did not
reflect errors in the equipment recommendations or policy discrepancies
with the RUC's equipment time recommendations. However, we believed it
was important to publish the specific equipment times that we were
proposing (or finalizing in the case of the final rule) when they
differed from the recommended values due to the effect these changes
can have on the direct costs associated with equipment time. Therefore,
we finalized the separation of the equipment time refinements
associated with changes in clinical labor into a separate table of
refinements. We direct readers to the discussion in the CY 2020 PFS
final rule (84 FR 62584) for additional details.
Historically, the RUC has submitted a ``PE worksheet'' that details
the recommended direct PE inputs for our use in developing PE RVUs. The
format of the PE worksheet has varied over time, and among the medical
specialties developing the recommendations. These variations have made
it difficult for the RUC's development and our review of code values
for individual codes. Beginning with its recommendations for CY 2019,
the RUC mandated the use of a new PE worksheet for its recommendation
development process that standardizes the clinical labor tasks and
assigns them a clinical labor activity code. We believe the RUC's use
of the new PE worksheet in developing and submitting recommendations
helps us simplify and standardize the hundreds of clinical labor tasks
currently listed in our direct PE database. To facilitate rulemaking
for CY 2027, we are displaying the Labor Task Detail public use file
that contains the current listing of clinical labor activity codes.
This file is available on the CMS website under downloads for the CY
2027 PFS proposed rule at https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PhysicianFeeSched/PFS-Federal-Regulation-Notices.html.
b. Updates to Prices for Existing Direct PE Inputs
In the CY 2011 PFS final rule with comment period (75 FR 73205), we
finalized a process to act on public requests to update equipment and
supply price and equipment useful life inputs through annual
rulemaking, beginning with the CY 2012 PFS proposed rule. Beginning in
CY 2019 and continuing through CY 2022, we conducted a market-based
supply and equipment pricing update using information developed by our
contractor which updated pricing recommendations for approximately 1300
supplies and 750 equipment items currently used as direct PE inputs.
Given the potentially significant changes in payment that would occur,
in the CY 2019 PFS final rule, we finalized a policy to phase in our
use of the new direct PE input pricing over a 4-year period using a 25/
75 percent (CY PFS 2019), 50/50 percent (CY PFS 2020), 75/25 percent
(CY PFS 2021), and 100/0 percent (CY PFS 2022) split between new and
old pricing. We believe that implementing the proposed updated prices
with a 4-year phase-in would improve payment accuracy while maintaining
stability and allowing interested parties to address potential concerns
about changes in payment for particular items. This 4-year transition
period to update supply and equipment pricing concluded in CY 2022; for
a more detailed discussion, we refer readers to the CY 2019 PFS final
rule with comment period (83 FR 59473 through 59480).
For CY 2027, we are proposing to update the price of nine supplies
and two equipment items in response to the public submission of
invoices following the publication of the CY 2026 PFS final rule. These
supply and equipment items with updated prices are listed in the
valuation of specific codes section of the rule under Table A-D9, CY
2027 Invoices Received for Existing Direct PE Inputs.
These proposed pricing updates include a request from the RUC to
update the pricing of the moderate sedation pack (SA044) to more
accurately reflect its components. The RUC determined that a sterile
gown is not needed as part of the moderate sedation pack, however, a
regular staff gown should be included to protect the sedation provider
from all body fluids, substance, and excretions. The RUC also requested
that a mask would be an appropriate addition in the sedation pack,
resulting in a price change from the current $19.20, minus the $5.13
sterile gown, plus the $1.19 staff gown and $0.43 mask, for a new total
price of $15.69. We are proposing this $15.69 price for the SA044
moderate sedation pack which is reflected in Table A-E, CY 2027
Invoices Received for Existing Direct PE Inputs.
Additionally, we received a potentially misvalued code (PMVC)
nomination for SA119 kit, low frequency ultrasound wound therapy (MIST)
and are proposing an updated supply cost from $320.18 to $100 for
SA119. We refer readers to section II.D. of this proposed rule for more
information about this proposal.
(1) Invoice Submission
We remind readers that we routinely accept public submissions of
invoices as part of our process for developing payment rates for new,
revised, and potentially misvalued codes. Often, these invoices are
submitted in conjunction with the RUC-recommended values for the codes.
To be included in a given year's proposed rule, we generally need to
receive invoices by the same February 10th deadline we noted for
consideration of RUC recommendations. However, we will consider
invoices submitted as public comments during the comment period
following the publication of the CY 2027 PFS proposed rule and will
consider any invoices received after February 10th or outside of the
public comment process as part of our established annual process for
requests to update supply and equipment prices. Interested parties are
encouraged to submit invoices with their public comments or, if outside
the notice and comment rulemaking process, via email at
[email protected].
(2) Supply Pack Pricing Update
Interested parties previously notified CMS that they identified
numerous discrepancies between the aggregated cost of some supply packs
and the individual item components contained within. The interested
parties indicated that CMS should rectify these mathematical errors as
soon as possible to ensure that the sum correctly matches the totals
from the individual items, and they recommended that we resolve these
pricing discrepancies in the supply packs during CY 2024 rule. The AMA
RUC convened a workgroup on this subject and submitted recommendations
to update pricing for a series of supply packs along with the
[[Page 43856]]
RUC's comment letter for the CY 2024 rule cycle.
We appreciated the additional information and RUC workgroup
recommendations regarding discrepancies in the aggregated cost of some
supply packs. However, due to the projected significant cost revisions
in the pricing of supply packs and because we did not propose to
address supply pack pricing in the CY 2024 proposed rule, we stated in
the CY 2024 final rule that this issue would be better addressed in
future rulemaking. For example, the cleaning and disinfecting endoscope
pack (SA042) is included as a supply input in more than 300 HCPCS
codes, which could have a sizable impact on the overall valuation of
these services, and which was not incorporated into the proposed RVUs
published for the CY 2024 proposed rule. We stated that interested
parties would be better served if we comprehensively addressed this
topic during future rulemaking in which commenters could provide
feedback in response to proposed pricing updates (88 FR 78833 through
78834).
For CY 2025, we proposed implementing the supply pack pricing
update and associated revisions as recommended by the RUC's workgroup
(89 FR 97726 through 97727). We proposed to update the pricing of the
``pack, cleaning and disinfecting, endoscope'' (SA042) supply from
$19.43 to $31.29, to update the pricing of the ``pack, drapes,
cystoscopy'' (SA045) supply from $17.33 to $14.99, to update the
pricing of the ``pack, ocular photodynamic therapy'' (SA049) supply
from $16.35 to $26.35, to update the pricing of the ``pack, urology
cystoscopy visit'' (SA058) supply from $113.70 to $37.63, and to update
the pricing of the ``pack, ophthalmology visit (w-dilation)'' (SA082)
supply from $3.91 to $2.33. As recommended by the RUC workgroup, we
also proposed to delete the ``pack, drapes, laparotomy (chest-
abdomen)'' (SA046) supply entirely. The updated prices for these supply
packs were listed in the valuation of specific codes section of this
rule under Table A-B5, CY 2025 Invoices Received for Existing Direct PE
Inputs (89 FR 97852).
In accordance with the RUC workgroup's recommendations, we also
proposed to create eight new supply codes, including components
contained within previously existing supply packs. Aside from the SB056
supply, which is a replacement in several HCPCS codes for the deleted
SA046 supply pack, all of these new supplies are not included as
standalone direct PE inputs in any current HCPCS codes, as they are,
again, components contained within previously existing supply packs. We
proposed to add:
The kit, ocular photodynamic therapy (PDT) (SA137) supply
at a price of $26.00 as a component of the SA049 supply pack;
The Abdominal Drape Laparotomy Drape Sterile (100 in x 72
in x 124 in) (SB056) supply at a price of $8.049 as a replacement for
the SA046 supply pack;
The drape, surgical, legging (SB057) supply at a price of
$3.284 as a component of the SA045 supply pack;
The drape, surgical, split, impervious, absorbent (SB058)
supply at a price of $8.424 as a component of the SA045 supply pack;
The post-mydriatic spectacles (SB059) supply at a price of
$0.328 as a component of the SA082 supply pack;
The y-adapter cap (SD367) supply at a price of $0.352 as a
component of the SA049 supply pack;
The ortho-phthalaldehyde 0.55 percent (for example, Cidex
OPA) (SM030) supply at a price of $0.554 as a component of the SA042
supply pack; and
The ortho-phthalaldehyde test strips (SM031) supply at a
price of $1.556 as a component of the SA042 supply pack.
The new supply pack component items were listed in the valuation of
specific codes section of the rule under Table A-B8, CY 2025 PFS (89 FR
97722) New Invoices (89 FR 97853).
We also proposed the following additional supply substitutions
based on the recommendations of the RUC workgroup. We proposed to
remove the deleted SA046 supply pack and replace it with the drape,
sterile, fenestrated 16in x 29in (SB011) supply for CPT codes 19020,
19101, 19110, 19112, 20101, and 20102. We proposed to remove the
deleted SA046 supply pack and replace it with two supplies--the drape,
sterile, three-quarter sheet (SB014) and the drape, towel, sterile 18in
x 26in (SB019)--for CPT codes 19000 and 60300. We proposed to remove
the deleted SA046 supply pack and replace it with 2 supplies--the
drape, towel, sterile 18in x 26in (SB019) and the newly created
Abdominal Drape Laparotomy Drape Sterile (100 in x 72 in x 124 in)
(SB056) supply--for CPT codes 22510, 22511, 22513, and 22514. We
proposed to remove the deleted SA046 supply pack without replacing it
with anything for CPT code 22526; the RUC workgroup did not make a
recommendation on what to do with CPT code 27278, which also previously
contained the SA046 supply pack. Therefore, we also proposed not to
replace the SA046 supply pack with any supplies for this code. The RUC
workgroup also recommended removing the SA046 supply pack from CPT code
64595 with no replacement; however, this code was recently reviewed at
the April 2022 RUC meeting and it no longer includes the SA046 supply.
In the comments on the CY 2025 PFS proposed rule (89 FR 97727),
several commenters supported the proposed supply pack pricing update as
recommended by the RUC workgroup, however they indicated concern over
the proposed decrease in the price of the urology cystoscopy visit pack
(SA058) from $113.70 to $37.63. The commenters stated that the proposed
pricing reduction in the SA058 supply could result in drastic payment
rate cuts for physicians performing cystoscopy services in the office
setting. The commenters requested that CMS either delay the pricing
update or phase-in the supply pack changes over a 4-year period like it
has done for other PE changes with significant redistributive effects,
allowing independent urology practices to better prepare for the
negative financial impact this change will have.
After considering these comments, we agreed that the use of a
phased-in transition period would be appropriate to allow practitioners
to adjust to the updated pricing of these supplies. During our previous
supply and equipment pricing update in the CY 2019 PFS final rule (83
FR 59475), we finalized a policy to phase in any updated pricing that
we established during the 4-year transition period for very commonly
used supplies and equipment, such as sterile gloves (SB024) or exam
tables (EF023), even if invoices were provided as part of the formal
review of a code family. Based on this previously established policy,
we finalized the use of a pricing transition for three supply packs in
Table A-B4.
[[Page 43857]]
[GRAPHIC] [TIFF OMITTED] TP16JY26.014
Following the same pattern as our previous supply/equipment and
clinical labor pricing updates, we finalized the implementation of this
pricing transition over 4 years such that one-quarter of the difference
between the current price and the fully phased-in price is implemented
for CY 2025 PFS (89 FR 97722), one-third of the difference between the
CY 2025 PFS (89 FR 97722) price and the final price is implemented for
CY 2026 PFS, and one-half of the difference between the CY 2026 price
and the final price is implemented for CY 2027, with the new direct PE
prices fully implemented for CY 2028. For the other proposed supply
packs, the cystoscopy drapes pack (SA045) is only included in seven
HCPCS codes and the ocular photodynamic therapy pack (SA049) is only
included in a single HCPCS code which do not meet these criteria
established in previous rulemaking and described previously in this
section. Therefore, we finalized each of them at their updated pricing
for CY 2025 PFS (89 FR 97722) as proposed in the proposed rule. We
believe that the use of this pricing transition will minimize any
potential disruptive effects during the 4-year transition period that
could be caused by other sudden shifts in RVUs due to the high number
of services that make use of these very common supply packs.
Several commenters also stated that although five incomplete packs
would have their pricing updated in the proposed rule, mathematical
errors still remained for a number of additional supply packs.
Commenters stated that only 3 of the 18 affirmed packs were priced
correctly to match their components and provided tables showing the
pricing of an additional 15 packs that needed mathematical correction
by deconstructing the packs to determine the correct price through
summing their individual components. Commenters requested that CMS
initiate a correction of the packs pricing such that the sum of the
individual components match the price of the corresponding pack as
detailed in Table A-B5.
[GRAPHIC] [TIFF OMITTED] TP16JY26.015
While we shared the concerns of the commenters regarding the need
for accuracy in the pricing of these supply packs, we had reservations
about their potential for pricing disruptions. Ten of these supply
packs are included in the direct PE inputs for at least 100 HCPCS
codes, and three of the packs are included in more than 1000 HCPCS
codes. Many of these pricing updates would lead to drastic changes in
pricing for these supply packs which are included in hundreds of HCPCS
codes, such as the SA051 pelvic exam pack decreasing in price from
$20.16 to $2.81 (-86 percent) and the SA048 minimum multi-specialty
visit pack decreasing in price from $5.02 to $1.98 (-61 percent). We
were particularly concerned that these changes in supply pack pricing
could lead to significant shifts in the overall PE RVU for affected
HCPCS codes, without these proposed rates appearing in the proposed
rule or allowing any opportunity for public comment.
Therefore, we did not finalize pricing updates for these additional
15 supply packs as requested by commenters. We anticipated returning to
this subject in future rulemaking to allow any changes in associated
pricing for HCPCS codes to appear in the proposed rule and provide an
opportunity for the public to comment. Should these supply pack pricing
updates be proposed in future
[[Page 43858]]
rulemaking, we anticipated that we might propose the same pricing
transition described above due to the number of potentially affected
HCPCS codes. We finalized all of the other supply pack pricing changes
as proposed, with the exception of the 4-year pricing transition for
three supply packs as described previously in this section.
For CY 2026, we proposed to continue implementing the supply pack
pricing update and associated revisions as previously recommended by
the RUC's workgroup. We proposed to update the price of the 15 supply
packs detailed in Table A-B5 which were received too late in CY 2025
PFS (89 FR 97722) to allow for proposed pricing or public comment. In
the case of the surgical instruments cleaning pack (SA043), the
moderate sedation pack (SA044) and the small ortho drapes pack (SA081),
the proposed pricing update is modest enough that we proposed these
supplies move immediately to their final prices for CY 2026.
For the 12 other supply packs, we proposed that they be
incorporated into the muti-year supply pack pricing transition
finalized in CY 2025 rulemaking. Rather than having two separate 4-year
pricing transitions associated with supply packs, we proposed that
these 12 additional supply packs fold into the previous pricing
transition using the same methodology, such that one-third of the
difference between the CY 2025 PFS (89 FR 97722) price and the final
price is implemented for CY 2026, and one-half of the difference
between the CY 2026 price and the final price is implemented for CY
2027, with the new direct PE prices fully implemented for CY 2028 (89
FR 97728). With the inclusion of the SA042, SA058, and SA082 supply
packs which began their pricing transition for CY 2025, we proposed the
total supply pack pricing update detailed in Table A-B6.
[GRAPHIC] [TIFF OMITTED] TP16JY26.016
Table A-B6 also includes the hydrophilic guidewire (SD089) supply
which we proposed to transition in pricing over 3 years given its
inclusion in approximately 100 HCPCS codes. We continue to believe that
the use of this pricing transition will minimize any potential
disruptive effects during the transition period that could be caused by
other sudden shifts in RVUs due to the high number of services that
make use of these very common supply items. After consideration of the
public comments, we finalized our supply pack pricing policies as
proposed in the CY 2026 PFS final rule (90 FR 49284).
For CY 2027, these supply packs will continue with the third year
of the previously finalized 4-year transition process as detailed in
Table A-B6. As is the case with other supply and equipment pricing, we
will consider invoices associated with these supply packs which are
submitted as public comments during the comment period following the
publication of the CY 2027 PFS proposed rule as part of our established
annual process for requests to update supply and equipment prices.
Interested parties are encouraged to submit invoices with their public
comments or, if outside the notice and comment rulemaking process, via
email at [email protected].
c. Technical Corrections to Direct PE Input Database and Supporting
Files
Following the publication of the CY 2026 PFS final rule, the RUC
submitted a potential technical correction issue related to global
period assignment for approximately three dozen codes. The RUC stated
that these codes had long descriptors which indicated that they were
add-on codes ``(List separately in addition to code for primary
procedure)''; however, these codes were assigned the XXX global period
instead of the ZZZ global period. The RUC requested that CMS consider
assigning the ZZZ global period for these codes as a technical
correction.
We reviewed the list of codes submitted by the RUC and we agree
that there appears to be a technical error in the global period
assignment for these codes. Most of the affected codes have non-payable
status codes and no RVUs, while the handful of affected HCPCS codes
that do have RVUs specifically state in their descriptors that they
were intended to be add-on codes, such as CPT code 88332 (Pathology
consultation during surgery; each additional tissue block with frozen
section(s)). We are therefore proposing to change the
[[Page 43859]]
following codes to the ZZZ global period:
BILLING CODE 4169-69-P
[GRAPHIC] [TIFF OMITTED] TP16JY26.017
BILLING CODE 4169-69-C
The RUC also requested assigning the ZZZ global period to three
anesthesia codes: CPT codes 01953, 01968, and 01969. However, currently
all anesthesia codes use the XXX global period, and it is unclear
whether the concept of an add-on global period would apply to
anesthesia coding given that they are valued using base units and time
units, unlike all other PFS services. For this reason, we are not
proposing the ZZZ global period for these three codes at this time. We
are soliciting comments from interested parties regarding the global
period assignment for these three anesthesia codes, as well as the
other codes listed in Table A-B7.
d. Updates to Practice Expense (PE) Methodology--Site of Service
Payment Differential
We proposed a significant refinement to our PE methodology to
better reflect trends in physician practice settings in the CY 2026 PFS
final rule (90 FR 49292 through 49297). Under the finalized policy, we
allocate half the amount of indirect PE RVUs per work RVU for services
furnished in the facility setting compared to those allocated to
services furnished in the non-facility setting. We noted in the CY 2026
PFS proposed rule (90 FR 32374) that this change to the indirect cost
allocation methodology was intended to better recognize the relative
resources involved in furnishing services paid under the PFS in
facility and non-facility settings. We compared this change to our
current methodology prior to CY 2026, which functionally presumed
approximately equal indirect costs incurred by physicians across sites
of service. This presumption was initially made in the context of most
practitioners maintaining office practices independent of the
facilities in which they provided care, and as we discussed in the CY
2026 PFS proposed and final rules, appears to be inconsistent with
contemporary trends in physician practice where some significant
portion of services furnished in facility settings are performed by
medical practitioners who do not maintain fully independent practices
[[Page 43860]]
and are less likely to incur a comparable amount of indirect costs.
Since finalizing the proposal in the CY 2026 PFS final rule, we
have heard from interested parties that the implementation of this
policy resulted in an unintended, but significant, site of service
differential for physician visits in nursing facility settings based
solely on whether the beneficiary's stay is covered under Part A. For
purposes of PFS payment, a service furnished to a patient in a skilled
nursing facility during a Part A hospital stay (place of service 31) is
considered to be in the ``facility'' setting, while a service furnished
to a patient in a Part B stay (place of service 32) is considered to be
in the ``non-facility'' setting, per the Medicare Claims Processing
Manual (MCPM), Chapter 12, Section 20.4.2 at http://www.cms.gov/Regulations-and-Guidance/Guidance/Manuals/Downloads/clm104c12.pdf.
Prior to CY 2026, the payment rate for these E/M services furnished in
a skilled nursing facility (``facility'') and a nursing facility
(``non-facility'') were equal. As intended, the 50 percent reduction to
the allocation of indirect PE based on work RVUs that we finalized for
CY 2026 shifted PE RVUs from the facility setting to the non-facility
setting. However, for nursing facility and skilled nursing facility
visits, the current site of service differential is determined based on
the status of the beneficiary (that is, a Part A versus Part B stay) in
that setting, rather than in the setting of care itself. Given that the
resource costs for the professional involved in furnishing an E/M
service would not be expected to differ based on whether the patient is
in a Part A stay or not, we believe it is more accurate for these E/M
services to be paid the same amount without regard to the beneficiary's
Part A status. Therefore, we are proposing to address this anomaly for
CY 2027 by equalizing the rate for nursing facility visits without
regard to the beneficiary's status by setting the facility PE RVU equal
to the non-facility PE RVU for CPT codes 99304 (Initial nursing
facility care, per day, for the evaluation and management of a patient,
which requires a medically appropriate history and/or examination and
straightforward or low level of medical decision making. When using
total time on the date of the encounter for code selection, 25 minutes
must be met or exceeded.), 99305 (Initial nursing facility care, per
day, for the evaluation and management of a patient, which requires a
medically appropriate history and/or examination and moderate level of
medical decision making. When using total time on the date of the
encounter for code selection, 35 minutes must be met or exceeded.),
99306 (Initial nursing facility care, per day, for the evaluation and
management of a patient, which requires a medically appropriate history
and/or examination and high level of medical decision making. When
using total time on the date of the encounter for code selection, 50
minutes must be met or exceeded.), 99307 (Subsequent nursing facility
care, per day, for the evaluation and management of a patient, which
requires a medically appropriate history and/or examination and
straightforward medical decision making. When using total time on the
date of the encounter for code selection, 10 minutes must be met or
exceeded.), 99308 (Subsequent nursing facility care, per day, for the
evaluation and management of a patient, which requires a medically
appropriate history and/or examination and low level of medical
decision making. When using total time on the date of the encounter for
code selection, 20 minutes must be met or exceeded.), 99309 (Subsequent
nursing facility care, per day, for the evaluation and management of a
patient, which requires a medically appropriate history and/or
examination and moderate level of medical decision making. When using
total time on the date of the encounter for code selection, 30 minutes
must be met or exceeded.), 99310 (Subsequent nursing facility care, per
day, for the evaluation and management of a patient, which requires a
medically appropriate history and/or examination and high level of
medical decision making. When using total time on the date of the
encounter for code selection, 45 minutes must be met or exceeded.),
99315 (Nursing facility discharge management; 30 minutes or less total
time on the date of the encounter), and 99316 (Nursing facility
discharge management; more than 30 minutes total time on the date of
the encounter).
This particular situation illuminates ongoing concerns regarding
the current site of service differential. For example, interested
parties have suggested that the current binary of facility and non-
facility does not account for the range of employment models associated
with physician services that drive significant differences in actual
practice expenses. Interested parties have encouraged us to refine our
previously finalized policy to ensure it is more empirically grounded
and narrowly tailored to independent physicians, consistent with the
policy's original intent. Interested parties have also stated that the
facility PE reductions have had a disparate effect on hospital medicine
groups and hospitalists, particularly those that operate independently
from their hospital or health systems. Interested parties have stated
that independent hospital medicine groups account for approximately
one-third to one-half of the hospital medicine groups nationwide, and
they are unable to cut administrative and overhead costs enough to
absorb our CY 2026 facility PE reductions. As a result, some interested
parties have stated that the reductions are accelerating the insolvency
of independent physician practices and leading to an increase in
hospital consolidation. We note that we have heard no general consensus
among interested parties to this effect, and we have received feedback
that this policy supports independent practices.
In the CY 2026 PFS proposed rule, we sought comments on whether our
proposal to reduce the portion of the facility PE RVUs allocated based
on work RVUs to half the amount allocated to non-facility PE RVUs was
an appropriate reduction or whether we should consider a different
percentage reduction for CY 2026 or in future years. In finalizing the
proposal, we noted that, while our change to the methodology for CY
2026 represented a starting point to correcting historic distortions in
the allocation of indirect PE costs across settings of care, we
intended to further examine our methodology and consider additional
refinements based upon feedback received and any studies or data
sources identified.
For CY 2027, we remain open to more specific data that addresses
the variability, as well as feedback on how to update the valuation and
payment methodologies to better reflect the relative resources involved
in furnishing the services, both across settings of care, and within
the context of an evolving ecosystem of care models and business
arrangements. Historically, we have relied extensively on specialty-
specific PE/HR survey data and the binary site of service differential
to best reflect variable PE costs.
To better inform our consideration of how to account for practice
expenses under the PFS methodologies, including the current
differentials that are effectuated based on the binary facility/non-
facility settings of care, we are seeking comment on how PE costs vary
for physicians and other professionals, not only based on whether they
practice in part or exclusively in a facility setting but also based on
how their costs vary when they are employed by health systems,
hospitals, or other entities. We noted in the CY 2026 PFS final rule
that (90 FR 49292) that the AMA has stated
[[Page 43861]]
that physician practices maintain some indirect PE costs for physicians
who are solely facility-based such as coding, billing, and scheduling.
That being said, we generally agree with the concerns presented by
MedPAC on the growth of exclusively facility-based physicians and agree
that potential overpayments for indirect practice expense costs could
be a driver of clinician movement to higher cost settings without
creating commensurate clinical value. This is why we lowered indirect
PE for facility-based physician to 50 percent in the CY 2026 PFS final
rule.
Moving forward, we remain interested in ensuring indirect PE RVUs
are appropriately accounting for indirect PE costs. As such, we are
seeking information that will help illuminate to what extent these
costs are truly incurred when the professionals are employed by the
hospital and/or practice primarily in the hospital and are not already
accounted for in the existing OPPS payments. For example, when a
physician is employed by and practicing in a hospital, what portion of
the indirect PE is associated with the PFS service, versus costs that
are associated with the payment to the hospital, such as those paid
under the OPPS?
We are seeking comment on the amount of indirect PE hospital-
employed physicians incur when they furnish care within a facility. For
these physicians, is the 50 percent indirect PE allocation accurate or
could it possibly be less than 50 percent, such as 0 percent? In the
case that there are little to no indirect costs incurred by the
physician or other professionals, and these costs are borne by the
hospital, we believe that these costs are not appropriately accounted
for under the PFS and we may well be overestimating the relative
resource costs compared to other PFS services. In consideration of the
accuracy of the current 50 percent indirect PE allocation for services
furnished in the facility setting, we are also seeking comment on
whether and how we might, alternatively or additionally, define and
identify physicians and professionals who are employed by hospitals,
health systems, or other entities to ensure the services they furnish
are not inappropriately consuming PE RVUs that would be more
appropriately assigned to services furnished by professionals incurring
comparatively greater practice expenses. Specifically, we are seeking
comment on whether a new HCPCS modifier for employed physicians would
be a reasonable way to identify and reduce facility PE from the
services they perform in the facility setting, or whether there are
other methods we could consider.
We are seeking comment on what are the primary variables we should
consider to continue to improve our data sources, allocation
methodologies, and payment rates across settings of care, to best
reflect the resources involved in furnishing PFS services by
professionals and suppliers operating in a complex marketplace, across
settings of care. We remain interested in objective data regarding
payment arrangements between hospitals, health systems, other employers
and physicians, including which costs are incurred and whether the full
range of costs are truly incurred by physicians and other professionals
in these kinds of employment relationships. This would help us
understand and improve how PE is allocated across settings of care,
both in general and for specific kinds of services.
6. Strategies To Improve Payment Transparency, Accuracy, and Congruency
Across Payment Systems
a. Professional and Technical Components
Because PFS services are paid across settings of care, and are the
primary way that Medicare pays medical professionals, understanding the
structure of PFS payment is a critical part of price transparency for
Medicare, other payers, and consumers. Likewise, misunderstanding or
confusion about what relative resources are incorporated in specific
PFS payment rates can be a significant obstacle for payers and
consumers navigating the health care market. For example, approximately
4,100 services paid as ``global surgical packages,'' (herein `globals')
are valued as bundled payments that aggregate multiple components of
care into a single payment amount, including post-operative visits that
are presumed to occur in particular settings (for example, inpatient
hospital, outpatient hospital, office) regardless of where the services
actually take place. Most PFS services are valued with a site of
service binary, where the non-facility setting is the aggregation of
all relative resources involved in furnishing the professional and
technical aspects of the service, and the facility setting, where the
rate generally excludes the facility costs involved in the service
since those costs are addressed through separately reported facility
fees. In contrast to these two constructs, there are other codes
(mainly describing diagnostic and imaging services) that may be billed
with professional component (PC, or modifier 26) and technical
component (TC) modifiers, or without modifiers (global codes) that are
paid for the complete global service. These differences in how payments
are constructed and displayed can make it difficult for interested
parties and CMS to evaluate relative payment rates, underlying resource
costs, and value across settings of care.
These challenges are further compounded by differences across
Medicare payment systems in how similar services are defined, bundled,
and paid. For example, some payment systems incorporate technical
inputs and facility resources into a single payment. This variation can
obscure meaningful comparisons across sites of care and may complicate
efforts to advance site-neutral payment policies aimed at reducing
incentives for hospitals to acquire physician practices and limit site-
of-care decisions based on financial considerations. As CMS continues
to consider approaches that remove obstacles from market competition
across settings of care, especially by improving transparency,
comparability of PFS payments is an important foundational step.
To facilitate more consistent comparisons across services and
settings, we have developed a public use file that displays, for
services that are not currently billable with TC/26 modifiers, RVUs
amounts that reflect the relative resources involved in furnishing
professional and technical aspects of the services, which is available
on the CMS website under downloads for the CY 2027 PFS proposed rule at
http://www.cms.gov/Medicare/Medicare-Fee-for-ServicePayment/PhysicianFeeSched/PFS-Federal-Regulation-Notices.html. This file is
intended to improve transparency regarding how PFS payments may be
conceptually divided between physician professional and technical
components of the services, especially to illuminate the differences in
fees between technical aspects of PFS services compared to facility
fees across settings of care. We believe that making these components
more visible, where feasible, may help interested parties better
understand the structure of PFS payments and support more informed
comparisons across settings of care. We note that we have excluded 010-
and 090-day global surgery services from display in this public use
file since there are numerous ways to consider how the structure of
payment for those codes may be best understood. The use of bundled
payments for the 010- and 090-day global surgery services results in
aggregated valuation for all pre-operative, intra-operative, and post-
[[Page 43862]]
operative services furnished over a defined period (0-, 10-, or 90-day
global periods), including services by both physician and clinical
staff and practice expense without clear visibility into how each
component contributes to the total bundled valuation. While we note
that the current structure of global surgery services has effectively
obscured how the components of care are individually valued and limited
our ability to disaggregate them for purposes of this public use file,
we seek comment on how to address this problem, either in possible
improvements to the global surgery packages or, at least, in the best
way to make their component pieces transparent. Additionally, we note
that there is a subset of additional exclusions from this public use
file, such as codes subject to the cognitive services floor and the
statutory phase-in of significant RVU reductions, due to technical
challenges with how these policies are implemented that hinder the
disaggregation of their component parts.
We emphasize that we are not proposing any changes to existing
payment or billing policies, including the use of the 010- and 090-day
globals. Rather, this effort is intended to improve transparency and
provide a foundation for future rulemaking. We believe that greater
visibility into how the professional and technical aspects of PFS
services are valued and paid, where feasible, may enhance the ability
of consumers, and payers (including CMS) to assess relativity across
services, may enhance CMS's efforts to improve valuation over time, and
support broader efforts to align payments across settings of care. We
are seeking comment on several aspects of this approach. First, we seek
comment on the utility of displaying RVUs associated with professional
and technical aspects of services that are not currently billable with
TC/26 modifiers, including how we may use this information to assess
payment differences across settings. Again, we also seek comment on
potential approaches CMS could consider in future rulemaking to improve
transparency for services currently paid as globals. Specifically, we
are interested in feedback on how CMS could develop methodologies to
more clearly identify and, where appropriate, disaggregate the
underlying components of these services. We are also interested in
comments on how CMS could ``right-size'' payments for the globals over
time to ensure they remain aligned with current clinical practice and
resource costs, are more readily updated based on empirical data, and
do not obscure differences in cost and value across settings of care.
b. Global Surgical Packages
We finalized a policy in the CY 2015 PFS final rule (79 FR 67582
through 67591) to transition all 10-day and 90-day globals to 0-day
globals, allowing any post-operative visits furnished after the day of
the procedure to be billed as a standalone visit. CMS was prohibited
from implementing this policy through section 523(a) of the Medicare
Access and CHIP Reauthorization Act (MACRA) and was required to collect
data on how to best value globals. CMS did so through a research
contract with RAND and a data-collection process over several years to
develop data to improve the payment rates for these services. Data
collection has been based on reporting of CPT code 99024 (Postoperative
follow-up visit, normally included in the surgical package, to indicate
that an evaluation and management service was performed during a
postoperative period for a reason(s) related to the original
procedure), which is limited to practices with 10 practitioners or
more, limited to nine States, and is used solely for data collection so
it has no associated payment with reporting the code. In the CY 2019
PFS final rule (83 FR 59503), we released findings that only 4 percent
of reviewed 10-day globals and 67 percent of reviewed 90-day globals
had one or more post-operative visit which occurred during the global
period and sought comment on potential approaches for revaluing the
globals based on these findings (83 FR 59504). In the CY 2023 PFS
proposed rule (87 FR 45877 through 45880), CMS reviewed the prior work
and conversations around global valuations, solicited feedback from the
public, and has continued to explore ways over the years to address
valuation of the globals that would be minimally disruptive to the PFS.
Over the past several years, CMS has taken several iterative steps
to improve payment accuracy for the globals. In the CY 2025 PFS final
rule (89 FR 97964 through 97968), CMS expanded the applicability of the
transfer of care modifiers to address instances where separate
practitioners are billing for standalone E/M visits during the global
period more directly with mandatory reporting of payment modifiers in
clinical cases when there is both a formal or informal transfer of care
between practitioners furnishing distinct portions of a global service.
CMS also created a post-operative care services add-on code to more
appropriately reflect the time and resources involved for practitioners
who were not involved in furnishing the surgical procedure. CMS is
continuing to explore further steps to improve accountability and more
accurate payment and what additional next steps CMS could take to
improve the payment rates for global services.
In keeping with the administration priorities and aligning spending
and value, we are proposing to pause the data collection required by
MACRA based on RAND's findings over the past several years. We remain
interested in how best to use and collect this data going forward and
ways we might consider improving this data collection. We currently
have several years of data that have continued to illustrate what we
believe is the issue with the post-operative visits during the global
period and how these visits are not occurring, yet providers are still
being paid for these visits under the current global payment policy.
Additionally, we believe that the current data collection may be
causing undo burden to providers and we believe that pausing the data
collection will aid in burden reduction for practitioners. We do
however question whether a more robust data collection would be
appropriate and if we should have all providers report CPT code 99024.
We are also seeking comment on the question we mentioned earlier in
this section, as to whether CMS should have all providers report CPT
code 99024, and also other data sources we might consider to more
accurately value the globals.
We are posting a public use file with this proposed rule to display
the imputed RVUs associated with both the 10- and 90-day post-operative
visits based on a purely arithmetic approach to understand the
valuation of the services based on the data that was analyzed. This
public use file shows the current work RVUs, the number of post-
operative visits that are reported to CMS using no-pay HCPCS code
99024, and the work RVUs remaining if all post-operative visits are
removed. This public use file is available on the CMS website under
downloads for the CY 2027 PFS proposed rule at http://www.cms.gov/Medicare/Medicare-Fee-for-ServicePayment/PhysicianFeeSched/PFS-Federal-Regulation-Notices.html. We welcome comments on potential revaluation
strategies that we may consider through future rulemaking.
C. Payment for Medicare Telehealth Services
As discussed in prior rulemaking, several conditions must be met
for Medicare to make payment for
[[Page 43863]]
telehealth services under the PFS. See further details and full
discussion of the scope of Medicare telehealth services in the CY 2018
PFS final rule (82 FR 53006), the CY 2021 PFS final rule (85 FR 84502),
the CY 2024 PFS final rule (88 FR 78861 through 78866), the CY 2026 PFS
final rule (90 FR 49316 through 49320), and in 42 CFR 410.78 and
414.65. Our current 3-step review process reflects the stepwise method
by which we consider requests to add services to or remove services
from the Medicare Telehealth Services List, beginning with the CY 2026
Medicare Telehealth Services List:
Step 1. Determine whether the service is separately payable under
the PFS.
Step 2. Determine whether the service is subject to the provisions
of section 1834(m) of the Act.
Step 3. Review the elements of the service as described by the
HCPCS code and determine whether each of them is capable of being
furnished using an interactive telecommunications system as defined in
Sec. 410.78(a)(3).
1. Changes to the Medicare Telehealth Services List
a. Requests To Add Services to the Medicare Telehealth Services List
for CY 2027
We did not receive any requests to add or remove services from the
Medicare Telehealth Services List for CY 2027.
Consistent with the deadline for our receipt of code valuation
recommendations from the American Medical Association's Relative Value
Scale Update Committee (AMA RUC) and other interested parties
established in the CY 2019 PFS final rule (83 FR 59491) and with the
process set forth in prior calendar years, for CY 2027, requests to add
services to the Medicare Telehealth Services List must have been
submitted to and received by CMS by February 10, 2026. Consistent with
the deadline for our receipt of code valuation recommendations from the
AMA RUC and other interested parties established in the CY 2019 PFS
final rule (83 FR 59491) and with the process set forth in prior
calendar years, for CY 2028, requests to add services to the Medicare
Telehealth Services List must be submitted to and received by CMS by
February 10, 2027. Each request submitted by the deadline to add a
service to the Medicare Telehealth Services List must include any
supporting documentation the requester wishes CMS to consider. Because
we use the annual PFS rulemaking process to make changes to the
Medicare Telehealth Services List, requesters are advised that any
information submitted as part of a request is subject to public
disclosure for this purpose. For more information on submitting a
request to add services to the Medicare Telehealth Services List,
including where to send these requests, and to view the current
Medicare Telehealth Service List, see our website at https://www.cms.gov/Medicare/Medicare-General-Information/Telehealth/index.html.
b. CMS Proposal To Add New Codes to the List
We are proposing to add HCPCS G-codes GACP1 (Advance care planning
including the explanation and discussion of advance directives such as
standard forms (with completion of such forms, when performed), first
20 minutes of clinical staff time with the patient, family member(s),
directed by a treating physician or other treating qualified health
care professional), GACP2 (Advance care planning including the
explanation and discussion of advance directives such as standard forms
(with completion of such forms, when performed), each additional 20
minutes with the patient, family member(s), directed by a treating
physician or other treating qualified health care professional (List
separately in addition to code for primary procedure)), GSMAS
(Voluntary, group-based medical session involving multiple patients
with common medical condition(s), receiving medical care in a group
setting; billed and led by a physician or qualified nonphysician
practitioner and may include services provided by other qualified
healthcare professionals, clinical staff, or auxiliary personnel under
the direction of the supervising physician or other practitioner.
Session integrates group education, counseling, and peer support with
individualized patient clinical assessment and care, 2-10 patients,
billed once per patient, per session.), GSLPP (Treatment of speech,
language, voice, communication, and/or auditory processing disorder;
individual; for the pediatric population up to age 18 or 21), and GADV1
(Office or other outpatient evaluation and management service(s) for
the diagnosis and treatment of vaccine adverse effects, new or
established patient; each 15 minutes personally performed by the
physician or qualified healthcare professional (list separately in
addition to CPT codes 99202, 99203, 99204, 99205, 99211, 99212, 99213,
99214, 99215, 99341, 99342, 99344, 99345, 99347, 99348, 99349, 99350))
to the Medicare Telehealth Services List. If finalized, these services
will be separately payable under the PFS. These services will be
subject to the provisions of section 1834(m) of the Act, as they are
inherently face-to-face services and would serve as a substitute for an
in-person encounter. We also believe that the elements of these
services as described by the HCPCS codes are capable of being furnished
using an interactive telecommunications system as defined in Sec.
410.78(a)(3). We refer readers to the relevant proposal in section
II.D. of this proposed rule for further background on these proposed
codes.
2. Telehealth Flexibilities and Modifiers
As discussed in the CY 2021 PFS final rule (85 FR 84506),
legislation enacted to address the PHE for COVID-19 provided the
Secretary with new authorities under section 1135(b)(8) of the Act, as
added by section 102 of the Coronavirus Preparedness and Response
Supplemental Appropriations Act, 2020 (Pub. L. 116-123, March 6, 2020)
and subsequently amended by section 6010 of the Families First
Coronavirus Response Act (Pub. L. 116-127, March 18, 2020) and section
3703 of the Coronavirus Aid, Relief, and Economic Security Act (CARES
Act) (Pub. L. 116-136, March 27, 2020), to waive or modify Medicare
telehealth payment requirements during the PHE for COVID-19.
We used these authorities to establish several flexibilities to
accommodate changes in the delivery of care during the PHE. Through
waiver authority under section 1135(b)(8) of the Act, in response to
the PHE for COVID-19, we removed the geographic and site of service
originating site restrictions in section 1834(m)(4)(C) of the Act, as
well as restrictions in section 1834(m)(4)(E) of the Act on the types
of practitioners who may furnish telehealth services, for the duration
of the PHE for COVID-19. We also used waiver authority to allow certain
telehealth services to be furnished via audio-only communication
technology. At the end of the PHE for COVID-19, these waivers and
interim policies were set to expire, and payment for Medicare
telehealth services would have once again been limited by the
requirements of section 1834(m) of the Act. These flexibilities have
been extended by Congress numerous times since, most recently in the
Consolidated Appropriations Act, 2026 (CAA, 2026) (Pub. L. 119-75,
February 3, 2026).
Section 6209(a) and (b) of the CAA, 2026 extends the flexibilities
for Medicare telehealth services to remove the geographic restrictions,
expand the list of acceptable originating sites, and expand the array
of practitioners eligible
[[Page 43864]]
to furnish telehealth services from January 30, 2026 to the extended
date of December 31, 2027. Section 6209(d) of the CAA, 2026 delays the
in-person visit requirements for mental health services furnished
through telehealth from January 30, 2026 to the extended date of
January 1, 2028. Section 6209(e) of the CAA, 2026 extends the
flexibilities to allow audio-only Medicare telehealth services from
January 30, 2026 to the extended date of January 1, 2028. To align with
these extensions, Sec. 410.78 has been revised, detailed later in this
proposed rule.
Additionally, section 6209(g) of the CAA, 2026, requires CMS to
establish modifiers for telehealth services in certain instances,
effective January 1, 2027. These modifiers do not affect payment and
are required for claims for telehealth services that are furnished
through a virtual telehealth platform by a physician or practitioner
that contracts with an entity that owns such virtual platform; or for
which a physician or practitioner has a payment arrangement with an
entity for use of such virtual platform; and for claims for telehealth
services that are furnished incident to a physician's or practitioner's
professional service.
In accordance with section 6209(g) of CAA, 2026, we are creating
modifiers BB and BC. Guidance on use of these modifiers will be
available on the CMS website. Any updates to this policy will be issued
via subregulatory guidance in accordance with section 6209(h) of the
CAA, 2026, which authorizes the Secretary to implement section 6209 via
program instruction or otherwise.
3. Telehealth Critical Care Consultations
In the CY 2017 PFS final rule (81 FR 80352 through 80353), we
established HCPCS codes G0508 (Telehealth consultation, critical care,
initial, physicians typically spend 60 minutes communicating with the
patient and providers via telehealth) and G0509 (Telehealth
consultation, critical care, subsequent, physicians typically spend 50
minutes communicating with the patient and providers via telehealth) to
report telehealth consultations for a patient requiring critical care
services. These services were modeled after CPT codes 99291 (Critical
care, evaluation and management of the critically ill or critically
injured patient; first 30 to 74 minutes) and 99292 (Critical care,
evaluation and management of the critically ill or critically injured
patient; each additional 30 minutes (list separately in addition to
code for primary service)).
When adding some services to the Medicare Telehealth Services List
in the past, we have included certain frequency restrictions on how
often physicians and other practitioners may furnish the service via
telehealth. These include a limitation of one critical care
consultation service furnished via telehealth per day, added in the CY
2017 final rule (81 FR 80198). In the CY 2026 PFS final rule, we
finalized permanently removing frequency limitations on furnishing
these services via telehealth (90 FR 49324 through 49325).
We continue to believe that physicians and other practitioners, who
have the greatest familiarity and insight into the needs of individual
beneficiaries, can use their complex professional judgment to determine
whether they can safely furnish a service via telehealth, given the
entirety of the circumstances, including the clinical profile and needs
of the beneficiary, to determine the appropriate service modality. We
strive to balance the goals of increasing physician or practitioner and
patient choice of service modality with consideration of patient safety
for all Medicare beneficiaries. As technology advances and more
services may be safely furnished via telehealth and paid under the PFS,
it is increasingly important for physicians and other practitioners to
exercise their professional judgment in determining the generally
appropriate service modality for their patients to receive a service.
Since the permanent removal of the frequency limitation of one
critical care consultation service furnished via telehealth per day, we
have received questions about language in the code descriptors for
HCPCS codes G0508 (Telehealth consultation, critical care, initial,
physicians typically spend 60 minutes communicating with the patient
and providers via telehealth) and G0509 (Telehealth consultation,
critical care, subsequent, physicians typically spend 50 minutes
communicating with the patient and providers via telehealth) describing
``initial'' and ``subsequent'' consultations, as well as questions
regarding the language about the typical time spent on the service. To
clarify the requirements for billing these services, we are proposing
the following revised code descriptors:
G0508: Telehealth consultation, critical care; first 30 to
74 minutes.
G0509: Telehealth consultation, critical care; each
additional 30 minutes (List separately in addition to code for primary
service).
We welcome comments on this proposal.
4. Changes To Teaching Physicians' Billing for Services Involving
Residents or Teaching Physicians With Virtual Presence
In the CY 2021 PFS final rule (85 FR 84577 through 84585), we
finalized a temporary policy that allowed the teaching physician to
have a virtual presence in all teaching settings, but only in clinical
instances when the service was furnished virtually (for example, a
three-way telehealth visit, with all parties in separate locations).
This permitted teaching physicians to have a virtual presence during
the key portion of the Medicare telehealth service for which payment
was sought, through audio/video real-time communications technology, in
all residency training locations through December 31, 2024.
As summarized in the CY 2025 PFS final rule (89 FR 97764 through
97765), commenters encouraged CMS to establish this policy permanently
and include in-person services to promote access to care, and stated
that teaching physicians should be allowed to determine when their
virtual presence would be clinically appropriate based on their
assessment of the patient's needs and the competency level of the
resident. In the CY 2026 PFS final rule, we finalized permanently
allowing teaching physicians to have a virtual presence in all teaching
settings, only in clinical instances when the service is a three-way
telehealth visit, with the teaching physician, resident, and patient in
different locations.
We have received feedback from interested parties that indicates
that our current policy for teaching physicians and residents can, in
somewhat rare cases, cause logistical complexities in scenarios where
either the teaching physician or resident is already in the same
physical location as the beneficiary. For CY 2027, we are proposing a
modification to our previously finalized policy. Rather than requiring
the teaching physician, resident, and patient to each be in a different
location, we are proposing to allow teaching physicians to bill for
services involving residents when either the teaching physician or
resident is in the same physical location as the beneficiary. We would
generally interpret physical presence to be defined as either the
teaching physician or resident in the same room as the beneficiary, but
we are seeking comment on other scenarios in which this may be
appropriate. This would only be applicable to services that are on the
Medicare Telehealth Services List. As always, documentation in the
[[Page 43865]]
medical record must continue to demonstrate whether the teaching
physician was physically present or present through audio/video real-
time communications technology at the time of the Medicare telehealth
service, which includes documenting the specific portion of the service
for which the teaching physician was present through audio/video real-
time communications technology. In accordance with section
1842(b)(7)(A)(i)(I) of the Act, the teaching physician must have
personal oversight and involvement over the management of the portion
of the case for which the payment is sought. We are seeking comments on
this proposal.
5. Telehealth Originating Site Facility Fee Payment Amount Proposed
Update
Section 1834(m)(2)(B) of the Act established the Medicare
telehealth originating site facility fee for telehealth services
furnished from October 1, 2001 through December 31, 2002 at $20.00, and
specifies that, for telehealth services furnished on or after January 1
of each subsequent calendar year, the telehealth originating site
facility fee is increased by the percentage increase in the Medicare
Economic Index (MEI) as defined in section 1842(i)(3) of the Act. The
proposed percentage increase in the MEI for CY 2027 is 2.5 percent and
is based on the expected historical percentage increase of the 2017-
based MEI. For the final rule, we propose to update the MEI increase
for CY 2027 based on historical data through the second quarter of
2026. Therefore, for CY 2027, the proposed payment amount for HCPCS
code Q3014 (Telehealth originating site facility fee) is $32.65. Table
A-C1 shows the Medicare telehealth originating site facility fee and
the corresponding MEI percentage increase for each applicable time
period.
BILLING CODE 4169-69-P
[GRAPHIC] [TIFF OMITTED] TP16JY26.018
BILLING CODE 4169-69-C
D. Valuation of Specific Codes Including Potentially Misvalued Services
Under the PFS
1. Background: Process for Valuing New, Revised, and Potentially
Misvalued Codes
Establishing valuations for newly created and revised CPT codes is
a routine part of maintaining the PFS. Since the inception of the PFS,
it has also been a priority to revalue services regularly to make sure
that the payment rates reflect the changing trends in the practice of
medicine and current prices for inputs used in the PE calculations.
Initially, this was accomplished primarily through the 5-year review
[[Page 43866]]
process, which resulted in revised work RVUs for CY 1997, CY 2002, CY
2007, and CY 2012, and revised PE RVUs in CY 2001, CY 2006, and CY
2011, and revised MP RVUs in CY 2010, CY 2015, and CY 2020. Under the
5-year review process, revisions in RVUs were proposed and finalized
via rulemaking. In addition to the 5-year reviews, beginning with CY
2009, CMS and the AMA's Relative Value Unit Update Committee (RUC)
identified a number of potentially misvalued codes each year using
various identification screens, as outlined in section II.C. of this
proposed rule, Potentially Misvalued Services under the PFS.
Historically, when we received RUC recommendations, our process had
been to establish interim final RVUs for the potentially misvalued
codes, new codes, and any other codes for which there were coding
changes in the final rule with comment period for a year. Then, during
the 60-day period following the publication of the final rule with
comment period, we accepted public comments about those valuations. For
services furnished during the calendar year following the publication
of interim final rates, we paid for services based upon the interim
final values established in the final rule. In the final rule with
comment period for the subsequent year, we considered and responded to
public comments received on the interim final values and typically made
any appropriate adjustments and finalized those values.
In the CY 2015 PFS final rule with comment period (79 FR 67547), we
finalized a new process for establishing values for new, revised and
potentially misvalued codes. Under the new process, we include proposed
values for these services in the proposed rule, rather than
establishing them as interim final in the final rule with comment
period. Beginning with the CY 2017 PFS proposed rule (81 FR 46162), the
new process was applicable to all codes, except for new codes that
describe truly new services. For CY 2017, we proposed new values in the
CY 2017 PFS proposed rule for the vast majority of new, revised, and
potentially misvalued codes for which we received complete RUC
recommendations by February 10, 2016. To complete the transition to
this new process, for codes for which we established interim final
values in the CY 2016 PFS final rule with comment period (81 FR 80170),
we reviewed the comments received during the 60-day public comment
period following release of the CY 2016 PFS final rule with comment
period (80 FR 70886), and re-proposed values for those codes in the CY
2017 PFS proposed rule. We considered public comments received during
the 60-day public comment period for the proposed rule before
establishing final values in the CY 2017 PFS final rule. As part of our
established process, we will adopt interim final values only in the
case of wholly new services for which there are no predecessor codes or
values and for which we do not receive recommendations in time to
propose values.
As part of our obligation to establish RVUs for the PFS, we
thoroughly review and consider available information including
recommendations and supporting information from the RUC, the Health
Care Professionals Advisory Committee (HCPAC), public commenters,
medical literature, Medicare claims data, comparative databases,
comparison with other codes within the PFS, as well as consultation
with other physicians and healthcare professionals within CMS and the
Federal Government as part of our process for establishing valuations.
Where we concur that the RUC's recommendations, or recommendations from
other commenters, are reasonable and appropriate and are consistent
with the time and intensity paradigm of physician work, we proposed
those values as recommended. Additionally, we continually engage with
interested parties, including the RUC, regarding our approach for
accurately valuing codes, and as we prioritize our obligation to value
new, revised, and potentially misvalued codes. We continue to welcome
feedback from all interested parties regarding valuation of services
for consideration through our rulemaking process.
2. Methodology for Establishing Work RVUs
a. Background
For each code identified in this section, we conduct a review that
includes the current work RVU (if any), RUC-recommended work RVU,
intensity, time to furnish the preservice, intraservice, and
postservice activities, as well as other components of the service that
contribute to the value. Our reviews of recommended work RVUs and time
inputs generally include, but have not been limited to, a review of
information provided by the RUC, the HCPAC, and other public
commenters, medical literature, and comparative databases, as well as a
comparison with other codes within the PFS, consultation with other
physicians and health care professionals within CMS and the Federal
Government, as well as Medicare claims data. We also assess the
methodology and data used to develop the recommendations submitted to
us by the RUC and other public commenters and the rationale for the
recommendations. In the CY 2011 PFS final rule with comment period (75
FR 73328 through 73329), we discussed a variety of methodologies and
approaches used to develop work RVUs, including survey data, building
blocks, crosswalks to key reference or similar codes, and magnitude
estimation (see the CY 2011 PFS final rule with comment period (75 FR
73328 through 73329) for more information). When referring to a survey,
unless otherwise noted, we mean the surveys conducted by specialty
societies as part of the formal RUC process.
Components that we use in the building block approach may include
preservice, intraservice, or postservice time and post-procedure
visits. When referring to a bundled CPT code, the building block
components could include the CPT codes that make up the bundled code
and the inputs associated with those codes. We use the building block
methodology to construct, or deconstruct, the work RVU for a CPT code
based on component pieces of the code. Magnitude estimation refers to a
methodology for valuing work that determines the appropriate work RVU
for a service by gauging the total amount of work for that service
relative to the work for a similar service across the PFS without
explicitly valuing the components of that work. In addition to these
methodologies, we frequently utilize an incremental methodology in
which we value a code based upon its incremental difference between
another code and another family of codes. Section 1848(c)(1)(A) of the
Act specifically defines the work component as the resources that
reflect time and intensity in furnishing the service. Also, the
published literature on valuing work has recognized the key role of
time in overall work. For particular codes, we refine the work RVUs in
direct proportion to the changes in the best information regarding the
time resources involved in furnishing particular services, either
considering the total time or the intraservice time.
Several years ago, to aid in the development of preservice time
recommendations for new and revised CPT codes, the RUC created
standardized preservice time packages. The packages include preservice
evaluation time, preservice positioning time, and preservice scrub,
dress and wait time. Currently, there are preservice time packages for
services typically furnished in the facility setting (for example,
preservice time packages
[[Page 43867]]
reflecting the different combinations of straightforward or difficult
procedure, and straightforward or difficult patient). Currently, there
are three preservice time packages for services typically furnished in
the non-facility setting.
We have developed several standard building block methodologies to
value services appropriately when they have common billing patterns.
For example, in cases where a service is typically furnished to a
beneficiary on the same day as an E/M service, we believe that there is
overlap between the two services in some of the activities furnished
during the preservice evaluation and postservice time. Our longstanding
adjustments have reflected a broad assumption that at least one-third
of the work time in both the preservice evaluation and postservice
period is duplicative of work furnished during the E/M visit.
Accordingly, in cases where we believe that the RUC has not
adequately accounted for the overlapping activities in the recommended
work RVU and/or times, we adjust the work RVU and/or times to account
for the overlap. The work RVU for a service is the product of the time
involved in furnishing the service multiplied by the intensity of the
work. Preservice evaluation time and postservice time both have a long-
established intensity of work per unit of time (IWPUT) of 0.0224, which
means that 1 minute of preservice evaluation or postservice time
equates to 0.0224 of a work RVU.
Therefore, in many cases when we remove 2 minutes of preservice
time and 2 minutes of postservice time from a procedure to account for
the overlap with the same day E/M service, we also remove a work RVU of
0.09 (4 minutes x 0.0224 IWPUT) if we do not believe the overlap in
time had already been accounted for in the work RVU. The RUC has
recognized this valuation policy and, in many cases, now addresses the
overlap in time and work when a service is typically furnished on the
same day as an E/M service.
The following paragraphs discuss our approach to reviewing RUC
recommendations and developing proposed values for specific codes. When
they exist, we also include a summary of interested party reactions to
our approach. We noted that many commenters and interested parties have
expressed concern over the years with our ongoing adjustment of work
RVUs based on changes in the best information we had regarding the time
resources involved in furnishing individual services. We have been
particularly concerned with the RUC's and various specialty societies'
objections to our approach given the significance of their
recommendations to our process for valuing services and since much of
the information we use to make the adjustments is derived from their
survey process. We note that we are obligated under the statute to
consider both time and intensity in establishing work RVUs for PFS
services. As explained in the CY 2016 PFS final rule with comment
period (80 FR 70933), we recognize that adjusting work RVUs for changes
in time is not always a straightforward process, so we have applied
various methodologies to identify several potential work values for
individual codes.
We observed that for many codes reviewed by the RUC, recommended
work RVUs have appeared to be incongruous with recommended assumptions
regarding the resource costs in time. This has been the case for a
significant portion of codes for which we recently established or
proposed work RVUs that are based on refinements to the RUC-recommended
values. When we adjusted work RVUs to account for significant changes
in time, we started by looking at the change in the time in the context
of the RUC-recommended work RVU. When the recommended work RVUs do not
appear to account for significant changes in time, we employed
different approaches (including survey data, building blocks,
crosswalks to key reference or similar codes, and magnitude estimation)
to identify potential values that reconcile the recommended work RVUs
with the recommended time values. Many of these methodologies, such as
survey data, building block, crosswalks to key reference or similar
codes, and magnitude estimation have long been used in developing work
RVUs under the PFS. In addition to these, we sometimes use the
relationship between the old time values and the new time values for
particular services to identify alternative work RVUs based on changes
in time components.
In so doing, rather than ignoring the RUC-recommended value, we
used the recommended values as a starting reference and then applied
one of these several methodologies to account for the reductions in
time that we believe were not otherwise reflected in the RUC-
recommended value. If we believe that such changes in time are already
accounted for in the RUC's recommendation, then we do not make such
adjustments. Likewise, we do not arbitrarily apply time ratios to
current work RVUs to calculate proposed work RVUs. We use the ratios to
identify potential work RVUs and consider these work RVUs as potential
options relative to the values developed through other options.
While we do not believe that the decrease in time as reflected in
survey values should always equate to a one-to-one or linear decrease
in newly valued work RVUs, we do believe that, since the two components
of work are time and intensity, absent an obvious or explicitly stated
rationale for why the relative intensity of a given procedure has
increased, significant decreases in time should be reflected in
decreases to work RVUs although not necessarily in a linear manner. If
the RUC's recommendation has appeared to disregard or dismiss the
changes in time, without a persuasive explanation of why such a change
should not be accounted for in the overall work of the service, then we
generally used one of the aforementioned methodologies to identify
potential work RVUs, including the methodologies intended to account
for the changes in the resources involved in furnishing the procedure
(such as building blocks or crosswalks to key reference or similar
codes).
Several interested parties, including the RUC, have expressed
general objections to our use of these methodologies and suggested that
our actions in adjusting the recommended work RVUs are inappropriate;
other interested parties have also expressed general concerns with CMS
refinements to RUC-recommended values in general. In the CY 2017 PFS
final rule (81 FR 80272 through 80277), we responded in detail to
several comments that we received regarding this issue. In the CY 2017
PFS proposed rule (81 FR 46162), we requested comments regarding
potential alternatives to making adjustments that would recognize
overall estimates of work in the context of changes in the resource of
time for particular services; however, we did not receive any specific
potential alternatives. As described earlier in this section,
crosswalks to key reference or similar codes are one of the many
methodological approaches we employed to identify potential values that
reconcile the RUC-recommended work RVUs with the recommended time
values when the RUC-recommended work RVUs did not appear to account for
significant changes in time.
We have historically relied on survey data provided by the American
Medical Association (AMA)/Specialty Society Relative Value Scale (RVS)
Update Committee (referred to as the RUC) to estimate practitioner
time, work intensity, and practice expense for the purpose of
establishing RVUs for the codes used for payment under the PFS. As
described in section II.C. of this
[[Page 43868]]
proposed rule, CMS regularly revalues codes as part of its potentially
misvalued codes initiative, as required by section 1848(c)(2)(K) of the
Act, using RUC survey data that shows clinicians' estimates of how long
a particular service takes to complete. In the CY 2025 PFS final rule,
we summarized public comments that we had received expressing concerns
with using RUC data as a source of valuation and identifying a need for
empirical data in the context of valuing advanced primary care
management services (89 FR 97898). In response to these comments, we
indicated that we were open to alternative recommendations for how to
price these and other services, and that we would consider all options
presented to us with a preference for information with empirical
evidence behind it. We also reminded commenters that we do not
exclusively rely on RUC recommendations and can receive data and
recommendations from other outside sources as well.
In the CY 2019 PFS final rule (83 FR 59515), in response to
comments, we clarified that terms ``reference services,'' ``key
reference services,'' and ``crosswalks'' as described by the commenters
are part of the RUC's process for code valuation. These are not terms
that we created, and we do not agree that we necessarily must employ
them in the identical fashion for the purpose of discussing our
valuation of individual services that come up for review. However, in
the interest of minimizing confusion and providing clear language to
facilitate feedback from interested parties, we stated that we would
seek to limit the use of the term, ``crosswalk,'' to those cases where
we made a comparison to a CPT code with the identical work RVU (83 FR
59515). We noted that we also occasionally make use of a ``bracket''
for code valuation. A ``bracket'' refers to when a work RVU falls
between the values of two CPT codes, one at a higher work RVU and one
at a lower work RVU.
We look forward to continuing to engage with interested parties and
commenters, including the RUC, as we prioritize our obligation to value
new, revised, and potentially misvalued codes; and we will continue to
welcome feedback from all interested parties regarding valuation of
services for consideration through our rulemaking process. We refer
readers to the detailed discussion in this section of the valuation
considered for specific codes. Table A-DX contains a list of codes and
descriptors for which we proposed work RVUs for CY 2027; this includes
all codes for which we received RUC recommendations by February 10,
2026. The proposed work RVUs, work time and other payment information
for all CY 2027 payable codes are available on the CMS website under
downloads for the CY 2027 PFS proposed rule at https://www.cms.gov/Medicare/Medicare-Feefor-ServicePayment/PhysicianFeeSched/index.html).
b. Efficiency Adjustment
In the CY 2026 final rule, we finalized the establishment of an
efficiency adjustment to the work RVUs, as well as corresponding
updates to the intraservice portion of physician time inputs for non-
time-based services, with refinements (90 FR 49334 through 49345). We
finalized a policy to apply this efficiency adjustment to the
intraservice portion of physician time and work RVUs every 3 years. To
calculate the efficiency adjustment, we finalized the use of the MEI
productivity adjustment over a 5-year look back period from CY 2022 to
CY 2026. We noted that using more recent historical data from the BLS
yielded an efficiency adjustment of 3.6 percent. As we discussed in the
CY 2026 PFS proposed rule, our approach in applying an efficiency
adjustment was to take into account changes in medical practice and to
better reflect resources involved, and it was designed to be
conservative in nature, as we were concerned about making too many
changes at once to the current methodology. Therefore, we finalized the
proposed efficiency adjustment of 2.5 percent. We also exempted
additional codes, specifically time-based codes, services on the CMS
telehealth list, and new codes for CY 2026, as reflected in the Codes
Subject to Efficiency Adjustment file. This file with efficiency
adjustment exemptions is issued annually and can be found in the public
use files for CY 2027; the file is available on the CMS website under
downloads for the CY 2027 PFS proposed rule at https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PhysicianFeeSched/PFS-Federal-Regulation-Notices.html. For a full discussion of the
efficiency adjustment, we direct readers to the CY 2026 PFS final rule
(90 FR 49334 through 49345).
For CY 2027 rulemaking, the RUC made a number of work RVU
recommendations prior to the finalization of the efficiency adjustment
in the CY 2026 PFS final rule. In these cases, where the RUC's work RVU
recommendation was based on a pre-adjusted work RVU, we have treated
the recommendation as though the RUC had recommended the efficiency
adjusted valuation. For example, the RUC initially recommended a work
RVU of 0.35 for CPT code 95XX4 based on a crosswalk to the pre-adjusted
work RVU of CPT code 95885. The work RVU of this crosswalk code became
0.34 after applying the efficiency adjustment, which we have used as
the recommended valuation for CPT code 95XX4. This policy affected a
relatively small number of the codes reviewed for CY 2027, and we have
noted in the preamble where the efficiency adjustment affected a work
valuation.
3. Methodology for the Direct PE Inputs To Develop PE RVUs
a. Background
On an annual basis, the RUC provides us with recommendations
regarding PE inputs for new, revised, and potentially misvalued codes.
We review the RUC-recommended direct PE inputs on a code-by-code basis.
Like our review of recommended work RVUs, our review of recommended
direct PE inputs generally includes, but is not limited to, a review of
information provided by the RUC, HCPAC, and other public commenters,
medical literature, and comparative databases, as well as a comparison
with other codes within the PFS, and consultation with physicians and
health care professionals within CMS and the Federal Government, as
well as Medicare claims data. We also assess the methodology and data
used to develop the recommendations submitted to us by the RUC and
other public commenters and the rationale for the recommendations. When
we determine that the RUC's recommendations appropriately estimate the
direct PE inputs (clinical labor, disposable supplies, and medical
equipment) required for the typical service, are consistent with the
principles of relativity, and reflect our payment policies, we use
those direct PE inputs to value a service. If not, we refine the
recommended PE inputs to better reflect our estimate of the PE
resources required for the service. We also confirm whether CPT codes
should have facility and/or non-facility direct PE inputs and refine
the inputs accordingly.
Our review and refinement of the RUC-recommended direct PE inputs
includes many refinements that are common across codes, as well as
refinements that are specific to particular services. Table A-D11
details our refinements of the RUC's direct PE recommendations at the
code-specific level. In section II.B. of this proposed rule,
Determination of Practice Expense Relative Value Units (PE RVUs), we
address certain refinements that will be
[[Page 43869]]
common across codes. Refinements to particular codes are addressed in
the portions of that section that are dedicated to particular codes. We
note that for each refinement, we indicate the impact on direct costs
for that service. We note that, on average, in any case where the
impact on the direct cost for a particular refinement is $0.35 or less,
the refinement has no impact on the PE RVUs. This calculation considers
both the impact on the direct portion of the PE RVU, as well as the
impact on the indirect allocator for the average service. In this
proposed rule, we also note that many of the refinements listed in
Table A-D11 result in changes under the $0.35 threshold and would be
unlikely to result in a change to the RVUs.
We note that the proposed direct PE inputs for CY 2027 are
displayed in the CY 2027 direct PE input files, available on the CMS
website under the downloads for the CY 2027 PFS proposed rule at
https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PhysicianFeeSched/PFS-Federal-Regulation-Notices.html. The inputs
displayed there have been used in developing the CY 2027 PE RVUs as
displayed in Addendum B (see https://www.cms.gov/medicare/payment/prospective-payment-systems/hospital-outpatient/addendum-a-b-updates).
b. Common Refinements
(1) Changes in Work Time
Some direct PE inputs are directly affected by revisions in work
time. Specifically, changes in the intraservice portions of the work
time and changes in the number or level of postoperative visits
associated with the global periods result in corresponding changes to
direct PE inputs. The direct PE input recommendations generally
correspond to the work time values associated with services. We believe
that inadvertent discrepancies between work time values and direct PE
inputs should be refined or adjusted in the establishment of proposed
direct PE inputs to resolve the discrepancies.
(2) Equipment Time
Prior to CY 2010, the RUC did not generally provide CMS with
recommendations regarding equipment time inputs. In CY 2010, in the
interest of ensuring the greatest possible degree of accuracy in
allocating equipment minutes, we requested that the RUC provide
equipment times along with the other direct PE recommendations, and we
provided the RUC with general guidelines regarding appropriate
equipment time inputs. We appreciate the RUC's willingness to provide
us with these additional inputs as part of its PE recommendations.
In general, the equipment time inputs correspond to the service
period portion of the clinical labor times. We clarified this principle
over several years of rulemaking, indicating that we consider equipment
time as the time within the intraservice period when a clinician is
using the piece of equipment plus any additional time that the piece of
equipment is not available for use for another patient due to its use
during the designated procedure. For those services for which we
allocate cleaning time to portable equipment items, because the
portable equipment does not need to be cleaned in the room where the
service is furnished, we do not include that cleaning time for the
remaining equipment items, as those items and the room are both
available for use for other patients during that time. In addition,
when a piece of equipment is typically used during follow-up
postoperative visits included in the global period for a service, the
equipment time will also reflect that use.
We believe that certain highly technical pieces of equipment and
equipment rooms are less likely to be used during all of the preservice
or postservice tasks performed by clinical labor staff on the day of
the procedure (the clinical labor service period) and are typically
available for other patients even when one member of the clinical staff
may be occupied with a preservice or postservice task related to the
procedure. We also noted that we believe these same assumptions will
apply to inexpensive equipment items that are used in conjunction with
and located in a room with non-portable highly technical equipment
items since any items in the room in question will be available if the
room is not being occupied by a particular patient. For additional
information, in that rule we referred readers to our discussion of
these issues in the CY 2012 PFS final rule with comment period (76 FR
73182) and the CY 2015 PFS final rule with comment period (79 FR
67639).
(3) Standard Tasks and Minutes for Clinical Labor Tasks
In general, the preservice, intraservice, and postservice clinical
labor minutes associated with clinical labor inputs in the direct PE
input database reflect the sum of particular tasks described in the
information that accompanies the RUC-recommended direct PE inputs,
commonly called the ``PE worksheets.'' For most of these described
tasks, there is a standardized number of minutes, depending on the type
of procedure, its typical setting, its global period, and the other
procedures with which it is typically reported. The RUC sometimes
recommends a number of minutes either greater than or less than the
time typically allotted for certain tasks. In those cases, we review
the deviations from the standards and any rationale provided for the
deviations. When we do not accept the RUC-recommended exceptions, we
refine the proposed direct PE inputs to conform to the standard times
for those tasks. In addition, in cases when a service is typically
billed with an E/M service, we remove the preservice clinical labor
tasks to avoid duplicative inputs and to reflect the resource costs of
furnishing the typical service.
We refer readers to section II.B. of this proposed rule,
Determination of Practice Expense Relative Value Units (PE RVUs), for
more information regarding the collaborative work of CMS and the RUC in
improvements in standardizing clinical labor tasks.
(4) Recommended Items That Are Not Direct PE Inputs
In some cases, the PE worksheets included with the RUC's
recommendations include items that are not clinical labor, disposable
supplies, or medical equipment or that cannot be allocated to
individual services or patients. We addressed these kinds of
recommendations in previous rulemaking (78 FR 74242), and we do not use
items included in these recommendations as direct PE inputs in the
calculation of PE RVUs.
(5) New Supply and Equipment Items
The RUC generally recommends the use of supply and equipment items
that already exist in the direct PE input database for new, revised,
and potentially misvalued codes. However, some recommendations include
supply or equipment items that are not currently in the direct PE input
database. In these cases, the RUC has historically recommended that a
new item be created and has facilitated our pricing of that item by
working with the specialty societies to provide us copies of sales
invoices. For CY 2027 we received invoices for several new supply and
equipment items. Tables A-D11 and A-D12 detail the invoices received
for new and existing items in the direct PE database. As discussed in
section II.B. of this proposed rule, Determination of Practice Expense
Relative Value Units, we encourage interested parties to review the
prices associated with these new and existing items to determine
whether these prices appear to be accurate. Where prices appear
inaccurate, we encourage
[[Page 43870]]
interested parties to submit invoices or other information to improve
the accuracy of pricing for these items in the direct PE database by
February 10th of the following year for consideration in future
rulemaking, similar to our process for consideration of RUC
recommendations.
We remind interested parties that due to the relativity inherent in
the development of RVUs, reductions in existing prices for any items in
the direct PE database increase the pool of direct PE RVUs available to
all other PFS services. Tables A-D11 and A-D12 also include the number
of invoices received and the number of non-facility allowed services
for procedures that use these equipment items. We provide the non-
facility allowed services so that interested parties will note the
impact the particular price may have on PE relativity, as well as to
identify items that are used frequently, since we believe that
interested parties are more likely to have better pricing information
for items used more frequently. A single invoice may not be reflective
of typical costs, and we encourage interested parties to provide
additional invoices so that we may identify and use accurate prices in
the development of PE RVUs.
In some cases, we do not use the price listed on the invoice that
accompanies the recommendation because we identify publicly available
alternative prices or information that suggests a different price is
more accurate. In these cases, we include this in the discussion of
these codes. In other cases, we cannot adequately price a newly
recommended item due to inadequate information. Sometimes, no
supporting information regarding the price of the item has been
included in the recommendation. In other cases, the supporting
information does not demonstrate that the item has been purchased at
the listed price (for example, vendor price quotes instead of paid
invoices). In cases where the information provided on the item allows
us to identify clinically appropriate proxy items, we may use existing
items as proxies for the newly recommended items. In other cases, we
include the item in the direct PE input database without any associated
price. Although including the item without an associated price means
that the item does not contribute to the calculation of the proposed PE
RVU for particular services, it facilitates our ability to incorporate
a price once we obtain information and are able to do so.
(6) Service Period Clinical Labor Time in the Facility Setting
Generally speaking, our direct PE inputs do not include clinical
labor minutes assigned to the service period because the cost of
clinical labor during the service period for a procedure in the
facility setting is not considered a resource cost to the practitioner
since Medicare makes separate payment to the facility for these costs.
We address code-specific refinements to clinical labor in the
individual code sections.
(7) Procedures Subject to the Multiple Procedure Payment Reduction
(MPPR) and the Outpatient Prospective Payment System (OPPS) Cap
We note that the list of services for the upcoming calendar year
that are subject to the MPPR for diagnostic cardiovascular services,
diagnostic imaging services, diagnostic ophthalmology services, and
therapy services are displayed in the public use files for the PFS
proposed and final rules for each year. In addition, the list of
procedures that meet the definition of imaging under section
1848(b)(4)(B) of the Act, and therefore, are subject to the OPPS cap,
are also displayed in the public use files for the PFS proposed and
final rules for each year. The public use files for CY 2027 are
available on the CMS website under downloads for the CY 2027 PFS final
rule at https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PhysicianFeeSched/PFS-Federal-Regulation-Notices.html. For more
information regarding the history of the MPPR policy, we referred
readers to the CY 2014 PFS final rule with comment period (78 FR 74261
through 74263).
Effective January 1, 2007, section 5102(b)(1) of the Deficit
Reduction Act of 2005 (DRA) (Pub. L. 109-171, enacted on February 8,
2006) amended section 1848(b)(4) of the Act to require that, for
imaging services, if--(i) The technical component (TC) (including the
TC portion of a global fee) of the service established for a year under
the fee schedule without application of the geographic adjustment
factor, exceeds (ii) The Medicare outpatient department (OPD) fee
schedule amount established under the prospective payment system (PPS)
for hospital OPD services under section 1833(t)(3)(D) of the Act for
such service for such year, determined without regard to geographic
adjustment under section 1833(t)(2)(D) of the Act, the Secretary shall
substitute the amount described in clause (ii), adjusted by the
geographic adjustment factor under the PFS, for the fee schedule amount
for such TC for such year. As required by section 1848(b)(4)(A) of the
Act, for imaging services furnished on or after January 1, 2007, we cap
the TC of the PFS payment amount for the year (prior to geographic
adjustment) by the Outpatient Prospective Payment System (OPPS) payment
amount for the service (prior to geographic adjustment). We then apply
the PFS geographic adjustment to the capped payment amount. Section
1848(b)(4)(B) of the Act defines imaging services as ``imaging and
computer-assisted imaging services, including X-ray, ultrasound
(including echocardiography), nuclear medicine (including PET),
magnetic resonance imaging (MRI), computed tomography (CT), and
fluoroscopy, but excluding diagnostic and screening mammography.'' For
more information regarding the history of the cap on the TC of the PFS
payment amount under the DRA (the ``OPPS cap''), we referred readers to
the CY 2007 PFS final rule with comment period (71 FR 69659 through
69662).
For CY 2027, we identified new and revised codes to determine which
services meet the definition of ``imaging services'' as defined at
section 1848(b)(4)(B) of the Act for purposes of this cap. Beginning
for CY 2027, we are proposing to include the following services in
Table A-D1 on the list of codes to which the OPPS cap applies:
[[Page 43871]]
[GRAPHIC] [TIFF OMITTED] TP16JY26.019
We believe that these codes meet the definition of imaging services
under section 1848(b)(4)(B) of the Act, and thus, should be subject to
the OPPS cap.
c. Valuation of Specific Codes for CY 2027
(1) Fine Needle Aspiration (CPT Codes 10005 and 10006)
The RUC received notification of interest from a specialty society
to re-review CPT codes 10005 (Fine needle aspiration biopsy, including
ultrasound guidance; first lesion) and 10006 (Fine needle aspiration
biopsy, including ultrasound guidance; each additional lesion) at the
January 2026 meeting.
We are proposing the RUC-recommended work RVUs of 1.35 for CPT code
10005 and 1.00 for 10006.
We are proposing the RUC recommended direct PE inputs for CPT codes
10005 and 10006 with one modification. The RUC submitted an invoice
associated with this code family for an update in the price of the
portable ultrasound (EQ250) equipment from its current price of
$41,612.53 to $83,750.00. However, based on our review of current
market pricing for portable ultrasounds, it appears that this type of
equipment is becoming less expensive, not doubling in price over
current . We also have reason to believe that the type of portable
ultrasound listed on the submitted invoice represented the upper end of
the market as opposed to the typical case. This invoice stated that the
product in question constitutes ``a high-performance diagnostic
ultrasound system'' including a 23-inch flat panel monitor. It is also
not clear from the submitted invoice that the product in question is
even a portable version of an ultrasound system.
Given that the price on this invoice was significantly higher than
other portable ultrasounds available for purchase, we are not proposing
to update the price of the EQ250 portable ultrasound which is used in
many other HCPCS codes. Instead, we are proposing to create a new
equipment item that describes a ``Fine Needle Aspiration portable
ultrasound'' (ER130) which we propose to price at the submitted
$83,750.00 price. The ER130 equipment is proposed to replace the
previous EQ250 portable ultrasound at the same 37 minutes for CPT code
10005 and 17 minutes for CPT code 10006 as recommended by the RUC.
(2) Skin Cell Suspension Autograft (CPT Codes 15X19, 15X20, 15X21, and
15X22)
In September 2025, the CPT Editorial Panel created four codes to
report skin cell suspension autograft (SCSA): CPT code 15X19 (Skin cell
suspension autograft (SCSA), trunk, arms, and/or legs; first 100 sq cm
or less, or 1% of body area of infants and children), CPT code 15X20
(Skin cell suspension autograft (SCSA), trunk, arms, and/or legs; each
additional 100 sq cm, or each additional 1% of body area of infants and
children, or part thereof (List separately in addition to code for
primary procedure)), CPT code 15X21 (Skin cell suspension autograft
(SCSA), face, scalp, eyelids, mouth, neck, ears, orbits, genitalia,
hands, feet, and/or multiple digits; first 100 sq cm or less, or 1% of
body area of infants and children), and CPT code 15X22 (Skin cell
suspension autograft (SCSA), face, scalp, eyelids, mouth, neck, ears,
orbits, genitalia, hands, feet, and/or multiple digits; each additional
100 sq cm, or each additional 1% of body area of infants and children,
or part thereof (List separately in addition to code for primary
procedure)). The existing eight skin cell suspension autograft CPT
codes (CPT codes 15011-15018) were deleted, and the ``Skin Cell
Suspension Autograft'' guidelines were revised. The four new codes were
surveyed for the January 2026 RUC meeting.
For CY 2027, we are proposing the RUC-recommended work RVUs of
10.97 for CPT code 15X19, 0.59 for CPT code 15X20, 11.28 for CPT code
15X21, and 0.98 for CPT code 15X22. We are proposing the RUC-
recommended direct PE inputs for CPT codes 15X19, 15X20, 15X21, and
15X22 without refinement.
(3) Computer Assisted Surgical Navigation (CPT Code 20985)
CPT code 20985 (Computer-assisted surgical navigational procedure
for musculoskeletal procedures, image-less (List separately in addition
to code for primary procedure)) was first identified via the high-
volume growth screen in April 2024.\1\ The RUC's Relativity Assessment
Workgroup (RAW) reviewed the action plan for 20985 and recommended that
the RUC refer CPT code 20985 to the CPT Editorial Panel for revision,
to modify the descriptor and address overlap with codes 0054T and
0055T. At the February 2025 CPT Editorial Panel meeting, CPT code 20985
was revised to remove ``image-less'' for reporting computer-assisted
surgical navigational procedures for musculoskeletal procedures.
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\1\ https://www.ama-assn.org/system/files/raw-progress-report.pdf.
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We are proposing the RUC-recommended work RVU of 2.44, which is the
current work RVU of CPT code 20985 after the efficiency adjustment was
applied at the start of CY 2026. The RUC did not recommend and we are
not proposing direct PE inputs for CPT code 20985.
(4) Ablation Therapy--Bone Tumors (CPT Code 209XX)
In February 2025, the CPT Editorial Panel approved new Category I
add-on code 209XX (Ablation therapy for reduction or eradication of
bone tumor, including adjacent soft tissue when involved by tumor
extension, cryoablation, open) to describe and report cryoablation
during an open
[[Page 43872]]
surgical procedure where the bone is frozen after a tumor resection.
CPT code 209XX was surveyed for the April 2025 meeting where the
specialty recommended an interim value; the code was resurveyed at the
September 2025 RUC meeting and recommendations submitted to CMS.
We are proposing the RUC-recommended work RVU of 2.70 for CPT code
209XX. The RUC did not recommend and we are not proposing any direct PE
inputs for this code.
(5) Intraosseous Fiducial Marker Placement (CPT Codes 209X1 and 209X2)
At the May 2025 CPT Editorial Panel Meeting, CPT approved the
addition of two codes and guidelines to report percutaneous
intraosseous fiducial marker placement for the first target site and
each additional target site, respectively: CPT codes 209X1 (Placement
of localization marker(s) (e.g., fiducial marker[s]), intraosseous,
percutaneous, including imaging guidance, when performed; first target
site) and 209X2 (Placement of localization marker(s) (e.g., fiducial
marker[s]), intraosseous, percutaneous, including imaging guidance,
when performed; each additional target site) . The specialties
clarified that these codes are not new technology but are new codes to
more accurately describe existing technology. These codes were surveyed
for the October 2025 RUC meeting.
We are proposing the RUC-recommended work RVU of 3.00 for CPT code
209X1 and the RUC-recommended work RVU of 1.76 for CPT code 209X2.
We are proposing the RUC-recommended direct PE inputs for both
codes in the family without refinement.
(6) Osteotomy--Spine (CPT Codes 22210, 22212, 22214, and 22216)
In CY 2025 rulemaking, CPT codes 22210 (Osteotomy of spine,
posterior or posterolateral approach, 1 vertebral segment; cervical),
22212 (Osteotomy of spine, posterior or posterolateral approach, 1
vertebral segment; thoracic), 22214 (Osteotomy of spine, posterior or
posterolateral approach, 1 vertebral segment; lumbar), and 22216
(Osteotomy of spine, posterior or posterolateral approach, 1 vertebral
segment; each additional vertebral segment (List separately in addition
to primary procedure)) were nominated as potentially misvalued
services.
At the September 2025 CPT Editorial Panel Meeting, CPT revised the
existing codes and guidelines to clarify that the codes include
complete resection of the interspinous ligament and the entirety of the
ligamentum flavum (i.e., laminar and subarticular) to allow deformity
correction through spinal column realignment. The osteotomy includes
resection of the inferior portion of the lamina, the inferior facet of
the cranial vertebra, the superior portion of the lamina, and the
superior facet of the caudal vertebra. Following the revisions to the
CPT guidelines and parentheticals for the code family, CPT codes 22210,
22212, 22214, and 22216 were surveyed for the January 2026 RUC meeting.
We disagree with the RUC's recommended work RVU for CPT codes
22210, 22212, and 22214 and we are proposing lower work RVUs in all
three cases. We reviewed the RUC's recommended work valuations and
found them to be high, relative to other codes with the same or similar
times. We note that although the surveyed intraservice work time
decreased substantially for all three of these codes, the RUC
recommended either maintaining the current work RVU (for CPT code
22210) or increasing the work RVU (for CPT codes 22212 and 22214),
stating that there was compelling evidence for increased work valuation
based on a change in the patient population and a change in technology.
However, these services maintained the same code descriptors, with only
minor changes to their billing guidelines, indicating that despite the
changes in technology and patient population the underlying procedure
remains significantly similar. Therefore, we do not agree with the RUC
that there has been an increase in intensity which would account for
these recommended work RVUs. While we do not believe that the decrease
in time as reflected in survey values should always equate to a one-to-
one or linear decrease in newly valued work RVUs, we do believe that
since the two components of work are time and intensity, absent an
obvious or explicitly stated rationale why the relative intensity of a
given procedure has increased, significant decreases in time should be
reflected in decreases to work RVUs although not necessarily in a
linear manner.
In the case of CPT codes 22210, 22212, and 22214, we believe that
the work RVUs should be reduced to account for the significant
decreases in surveyed intraservice work time.
Additionally, the postoperative office visit levels in this code
family are increasing from three level 2 evaluation and management
visits to one level 4 and two level 3 office visits. The shifting of
the post-operative visits in this code family to higher level office
visit codes that require more time, maintains the total time and thus
reflects a higher intensity and can contribute to a higher work RVU
which highlights our overall concerns with visits during the global
period and how we believe that all of these visits are not typically
occurring. We refer readers to section II.B. of this proposed rule
under ``b. Global Surgical Packages'' for that discussion.
We disagree with the RUC recommended value of 24.75 for CPT code
22210 and we are instead proposing a work RVU of 23.12 based on a
crosswalk to CPT code 34701 (Endovascular repair of infrarenal aorta by
deployment of an aorto-aortic tube endograft including pre-procedure
sizing and device selection, all nonselective catheterization(s), all
associated radiological supervision and interpretation, all endograft
extension(s) placed in the aorta from the level of the renal arteries
to the aortic bifurcation, and all angioplasty/stenting performed from
the level of the renal arteries to the aortic bifurcation; for other
than rupture (e.g., for aneurysm, pseudoaneurysm, dissection,
penetrating ulcer)). This code has a lower intraservice time and a
similar total time. We noticed that the surveyed intraservice time for
CPT code 22210 is decreasing by nearly an hour, from 170 minutes to 120
minutes, indicating that the procedure typically takes much less time
to perform than it did at the time of last review. Although the RUC has
recommended significantly more postoperative time in the inpatient and
outpatient visits, which has caused the total time of the procedure to
increase slightly, we note that this postoperative care should take
place at a significantly lower intensity than the 50 minutes of
intraservice time being removed from the code. We are concerned that,
while the intraservice time for CPT code 22210 is decreasing from 170
to 120 minutes, this intraservice work time is being replaced with
higher levels of post operative care to result in the total time being
maintained similar to the current time. We believe that with the
intraservice time going down, this reflects that the procedure has a
lesser intensity than before and therefore it does not makes sense that
the intensity of the post operative visit levels would increase.
Separately, we continue to have concern with the post-operative visits
in general and we do not believe the post-operative visits are
happening and therefore would not justify the higher value.
We believe that it better serves relativity to propose a work RVU
of 23.12, which maintains the current intensity of CPT code 22210, as
opposed to proposing the RUC's recommended
[[Page 43873]]
work RVU of 24.75 which results in an intensity increase for this code.
We are supporting this proposed work RVU of 23.12 with a pair of other
90-day global codes with similar work time values: CPT code 34718
(Endovascular repair of iliac artery, not associated with placement of
an aorto-iliac artery endograft at the same session, by deployment of
an iliac branched endograft, including pre-procedure sizing and device
selection, all ipsilateral selective iliac artery catheterization(s),
all associated radiological supervision and interpretation, and all
endograft extension(s) proximally to the aortic bifurcation and
distally in the internal iliac, external iliac, and common femoral
artery(ies), and treatment zone angioplasty/stenting, when performed,
for other than rupture (e.g., for aneurysm, pseudoaneurysm, dissection,
arteriovenous malformation, penetrating ulcer), unilateral), valued at
a work RVU of 23.40 with an intraservice time of 120 minutes, and CPT
code 34707 (Endovascular repair of iliac artery by deployment of an
ilio-iliac tube endograft including pre-procedure sizing and device
selection, all nonselective catheterization(s), all associated
radiological supervision and interpretation, and all endograft
extension(s) proximally to the aortic bifurcation and distally to the
iliac bifurcation, and treatment zone angioplasty/stenting, when
performed, unilateral; for other than rupture (e.g., for aneurysm,
pseudoaneurysm, dissection, arteriovenous malformation)), valued at a
work RVU of 21.72 with an intraservice time of 120 minutes.
We disagree with the RUC recommended value of 23.20 for CPT code
22212 and we are instead proposing a work RVU of 21.72 based on a
crosswalk to CPT code 34707. This code has a lower intraservice time
and a slightly lower total time. We noticed that the surveyed
intraservice time for CPT code 22212 is also decreasing significantly,
from 147 minutes to 120 minutes, which is offset by the RUC's
recommendation of significantly more time in the postoperative visits.
We do not agree with the RUC that the work RVU should be increasing by
nearly 3.00 RVUs for a procedure where the intraservice time, which is
likely to be the most difficult and dangerous part of the procedure, is
going down by approximately half an hour. We believe that the RUC's
recommended work RVU of 23.20 results in an intensity increase for this
code and therefore it better serves relativity to propose a work RVU of
21.72, which maintains the current intensity of CPT code 22212. This
proposed work RVU of 21.72 accounts for the decrease in intraservice
time and change in the level of the postoperative office visits and is
well bracketed by CPT code 34701, valued at a work RVU of 23.12 work
with an intraservice time of 120 minutes, and CPT code 38115 (Repair of
ruptured spleen (splenorrhaphy) with or without partial splenectomy),
valued at a work RVU of 21.33 with an intraservice time of 120 minutes.
We disagree with the RUC recommended value of 21.72 for CPT code
22214 and we are instead proposing a work RVU of 19.53 based on a
crosswalk to CPT code 44125 (Enterectomy, resection of small intestine;
with enterostomy). This code has a lower intraservice time and a higher
total time and its use as a crosswalk code maintains the current
intensity of CPT code 22214. As was the case with the first two codes,
we noticed that the surveyed intraservice time for CPT code 22214 is
decreasing significantly, from 163 minutes to 120 minutes, which is
offset by the RUC's recommendation of significantly more time in the
postoperative visits. We do not agree with the RUC that the work RVU
should be increasing for a procedure where the intraservice time, the
most difficult and dangerous part of the procedure, is going down by
more than half an hour. We believe that it better serves relativity to
propose a work RVU of 19.53, which maintains the current intensity of
CPT code 22214, as opposed to proposing the RUC's recommended work RVU
of 21.72 which results in an intensity increase for this code. This
proposed work RVU of 19.53 accounts for the decrease in intraservice
time and change in the level of the postoperative office visits and is
well bracketed by CPT code 38115, valued at a work RVU of 21.33 with an
intraservice time of 120 minutes, and CPT code 42890 (Limited
pharyngectomy), valued at a work RVU of 18.65 with an intraservice time
of 120 minutes.
We are proposing the RUC recommended work RVU of 3.00 for CPT code
22216, as this code maintains its current intensity at the RUC's
recommended valuation and maintains relativity with other similar add-
on codes.
We are proposing the RUC recommended direct PE inputs for all the
codes in this family without refinement.
(7) Arthroplasty--Shoulder (CPT Codes 23470 and 23472)
In April 2025, the RAW identified CPT code 23472 as having a site
of service anomaly where Medicare data from 2021-2023 indicated it was
performed less than 50 percent of the time in the inpatient setting yet
included inpatient hospital E/M services within the global period. The
RAW concluded that CPT code 23472 represented a site of service anomaly
and identified CPT code 23470 as part of this family of services. The
RUC therefore surveyed CPT codes 23470 (Arthroplasty, glenohumeral
joint; hemiarthroplasty) and 23742 (Arthroplasty, glenohumeral joint;
total shoulder (glenoid and proximal humeral replacement (e.g., total
shoulder))) for the September 2025 meeting.
We disagree with the RUC's recommended work RVU of 15.60 for CPT
code 23470 and we are instead proposing a work RVU of 13.81 based on a
crosswalk to CPT code 27416 (Osteochondral autograft(s), knee, open
(e.g., mosaicplasty) (includes harvesting of autograft[s])). The RUC
recommended a work RVU of 15.60, which is the current work RVU of the
RUC's crosswalk code 67107 (Repair of retinal detachment; scleral
buckling (such as lamellar scleral dissection, imbrication or
encircling procedure), including, when performed, implant, cryotherapy,
photocoagulation, and drainage of subretinal fluid) after the
efficiency adjustment was applied at the start of CY 2026. In reviewing
CPT code 23470, we note that the recommended intraservice time is
decreasing from 113 minutes to 90 minutes (20 percent reduction), and
the recommended total time is decreasing from 390 minutes to 330
minutes (22 percent reduction); however, the RUC-recommended work RVU
is only decreasing from 17.44 to 15.60, which is a reduction of just
over 10 percent. While we do not believe that the decrease in time as
reflected in survey values should always equate to a one-to-one or
linear decrease in newly valued work RVUs we do believe that, since the
two components of work are time and intensity, absent an obvious or
explicitly stated rationale for why the relative intensity of a given
procedure has increased, significant decreases in time should be
reflected in decreases to work RVUs although not necessarily in a
linear manner.
More specifically, CPT code 23470 was identified by the RAW as
having a site of service anomaly in which the service was performed
less than 50 percent of the time in the inpatient
[[Page 43874]]
setting yet included inpatient hospital Evaluation and Management
services within the global period. The RUC has recommended the removal
of five inpatient hospital visits along with recommending a decrease of
23 minutes to the intraservice work time based on the survey. We do not
believe that the RUC's recommended work decrease of fewer than two RVUs
appropriately captures this decrease in procedure time and physician
work for CPT code 23470. We also noticed that the RUC's recommended
work RVU of 15.60 results in an intensity increase for CPT code 23470.
We disagree that an increase in intensity for this code is warranted,
particularly given that the typical case for the procedure is moving
from the inpatient to outpatient setting. The code descriptor for CPT
code 23470 also remains unchanged which suggests that there has been no
significant change in the procedure's performance or intensity.
Furthermore, we also found that the recommended work RVU of 15.60 was
higher than nearly all of the other 90 day global codes with similar
time values, and we do not believe that this type of shoulder
arthroplasty procedure, which is typically done on a routine and
elective basis, would warrant an intensity and work valuation at the
very top of the scale relative to other 90 day globals with similar
time values. Because the PFS uses a relative value system, we believe
it is important to highlight that these codes fail to maintain
relativity with related surgical services. We are therefore proposing a
work RVU of 13.81 based on a crosswalk to CPT code 27416 which
preserves the current intensity of CPT code 23470 and better maintains
relativity with the rest of the PFS.
We disagree with the RUC's recommended work RVU of 19.35 for CPT
code 23472 and we are instead proposing a work RVU of 17.49 based on a
crosswalk to CPT code 67414 (Orbitotomy without bone flap (frontal or
transconjunctival approach); with removal of bone for decompression).
The RUC recommended a work RVU of 19.35, which is the current work RVU
of the RUC's crosswalk code 61798 (Stereotactic radiosurgery (particle
beam, gamma ray, or linear accelerator); 1 complex cranial lesion)
after the efficiency adjustment was applied at the start of CY 2026. In
reviewing CPT code 23472, we note that the recommended intraservice
time is decreasing from 140 minutes to 120 minutes (15 percent
reduction), and the recommended total time is decreasing from 448
minutes to 348 minutes (24 percent reduction); however, the RUC-
recommended work RVU is only decreasing from 21.58 to 19.35, which is a
reduction of just over 10 percent. While we do not believe that the
decrease in time as reflected in survey values should always equate to
a one-to-one or linear decrease in newly valued work RVUs we do believe
that, since the two components of work are time and intensity, absent
an obvious or explicitly stated rationale for why the relative
intensity of a given procedure has increased, significant decreases in
time should be reflected in decreases to work RVUs although not
necessarily in a linear manner.
More specifically, CPT code 23472 was identified by the RAW as
having a site of service anomaly in which the service was performed
less than 50 percent of the time in the inpatient setting yet included
inpatient hospital Evaluation and Management services within the global
period. The RUC has recommended the removal of 3 inpatient hospital
visits, one outpatient E/M visit, a decrease from a full to a half
discharge visit, along with recommending a decrease of 20 minutes to
the intraservice work time based on the survey. We do not believe that
the RUC's recommended work decrease of just over two RVUs appropriately
captures this decrease in procedure time and practitioner work for CPT
code 23472. We also noticed that the RUC's recommended work RVU of
19.35 results in an intensity increase for CPT code 23472. We disagree
that an increase in intensity for this code is warranted, particularly
given that the typical case for the procedure is moving from the
inpatient to outpatient setting. The code descriptor for CPT code 23472
also remains unchanged which suggests that there has been no
significant change in the procedure's performance or intensity.
Furthermore, we also found that the recommended work RVU of 19.35 was
higher than nearly all of the other 90 day global codes with similar
time values, and we do not believe that this type of total shoulder
arthroplasty procedure, which is typically done on a routine and
elective basis, would warrant an intensity and work valuation at the
very top of the scale relative to other 90 day globals with similar
time values. We are therefore proposing a work RVU of 17.49 based on a
crosswalk to CPT code 67414 which preserves the current intensity of
CPT code 23472 and better maintains relativity with the rest of the
PFS.
We are proposing the RUC-recommended direct PE inputs for CPT codes
23470 and 23472 without refinement.
(8) Arthroplasty--Hip (CPT Code 27130)
In April 2025, the RAW identified CPT code 27130 as having a site
of service anomaly where Medicare data from 2021-2023 indicated it was
performed less than 50 percent of the time in the inpatient setting yet
included inpatient hospital Evaluation and Management services within
the global period. The RAW concluded that the code represented a site
of service anomaly, and the RUC therefore surveyed CPT code 27130
(Arthroplasty, acetabular and proximal femoral prosthetic replacement
(total hip arthroplasty), with or without autograft or allograft) for
the September 2025 meeting.
We disagree with the RUC's recommended work RVU of 16.70 for CPT
code 27130 and we are instead proposing a work RVU of 15.37 based on a
crosswalk to CPT code 43774 (Laparoscopy, surgical, gastric restrictive
procedure; removal of adjustable gastric restrictive device and
subcutaneous port components). The RUC recommended a work RVU of 16.70,
which is the current work RVU of the RUC's crosswalk code 67108 (Repair
of retinal detachment; with vitrectomy, any method, including, when
performed, air or gas tamponade, focal endolaser photocoagulation,
cryotherapy, drainage of subretinal fluid, scleral buckling, and/or
removal of lens by same technique) after the efficiency adjustment was
applied at the start of CY 2026. In reviewing CPT code 27130, we noted
that the recommended total time is decreasing from 377 minutes to 305
minutes (19 percent reduction); however, the RUC-recommended work RVU
is only decreasing from 19.11 to 16.70, which is a reduction of 13
percent. While we do not believe that the decrease in time as reflected
in survey values should always equate to a one-to-one or linear
decrease in newly valued work RVUs we do believe that, since the two
components of work are time and intensity, absent an obvious or
explicitly stated rationale for why the relative intensity of a given
procedure has increased, significant decreases in time should be
reflected in decreases to work RVUs although not necessarily in a
linear manner.
More specifically, CPT code 27130 was identified by the RAW as
having a site of service anomaly in which the service was performed
less than 50 percent of the time in the inpatient setting yet included
inpatient hospital Evaluation and Management services within the global
period. The RUC has recommended the removal of 2 inpatient hospital
visits, a decrease from
[[Page 43875]]
a full to a half discharge visit, along with recommending a decrease of
10 minutes to the intraservice work time based on the survey. We do not
believe that the RUC's recommended work decrease of just over two RVUs
appropriately captures this decrease in procedure time and practitioner
work for CPT code 27130. We also noticed that the RUC's recommended
work RVU of 16.70 results in an intensity increase for CPT code 27130.
We disagree that an increase in intensity for this code is warranted,
particularly given that the typical case for the procedure is moving
from the inpatient to outpatient setting. The code descriptor for CPT
code 27130 also remains unchanged which suggests that there has been no
significant change in the procedure's performance or intensity.
Furthermore, we also found that the recommended work RVU of 16.70 was
higher than nearly all of the other 90 day global codes with similar
time values, and we do not believe that this type of total hip
arthroplasty procedure, which is typically done on a routine and
elective basis, would warrant an intensity and work valuation at the
very top of the scale relative to other 90 day globals with similar
time values. We are therefore proposing a work RVU of 15.37 based on a
crosswalk to CPT code 43774 which preserves the current intensity of
CPT code 27130 and better maintains relativity with the rest of the
PFS.
We are proposing the RUC-recommended direct PE inputs for CPT code
27130 without refinement.
(9) Sacroiliac Joint Arthrodesis (CPT Codes 27278 and 27279)
At the May 2025 CPT Editorial Panel meeting. CPT code 27278
(Arthrodesis, sacroiliac joint, percutaneous or minimally invasive,
including imaging guidance, unilateral; placement of intra-articular
structural bone graft, metal and/or synthetic device(s) without
cortical piercing, including use of osteopromotive material and/or
obtaining bone graft, when performed) was revised to include imaging
guidance, placement of intra-articular structural bone graft, metal,
and/or synthetic device(s) without cortical piercing and CPT code 27279
(Arthrodesis, sacroiliac joint, percutaneous or minimally invasive,
including imaging guidance, unilateral; placement of transarticular
and/or intra-articular device(s) that engage bone with intrinsic
fixation (e.g., screw[s], flange[s], blade[s]) piercing the lateral
cortex of the sacrum and the medial cortex of the ilium (with or
without piercing the lateral cortex of the ilium), including use of
osteopromotive material and/or obtaining bone graft, when performed)
was revised to include placement of transarticular and/or intra-
articular device(s) that engage bone with intrinsic fixation (e.g.,
screw(s), flange(s), blade(s)) piercing the lateral cortex of the
sacrum and the medial cortex of the ilium. CPT codes 27278 and 27279
were surveyed for the September 2025 RUC meeting.
We are proposing the RUC-recommended work RVUs of 7.66 for CPT code
27278 (which is the current work RVU of the code after the efficiency
adjustment was applied at the start of CY 2026) and 11.00 for CPT code
27279. We are also proposing the RUC-recommended direct PE inputs for
CPT codes 27278 and 27279 without refinement.
(10) Arthroplasty--Knee (CPT Code 27447)
In April 2025, the RAW identified CPT code 27447 as having a site
of service anomaly where Medicare data from 2021-2023 indicated it was
performed less than 50 percent of the time in the inpatient setting yet
included inpatient hospital Evaluation and Management services within
the global period. The RAW concluded that the code represented a site
of service anomaly, and the RUC therefore surveyed CPT code 27447
(Arthroplasty, knee, condyle and plateau; medial AND lateral
compartments with or without patella resurfacing (total knee
arthroplasty)) for the September 2025 meeting.
We disagree with the RUC's recommended work RVU of 16.70 for CPT
code 27447 and we are instead proposing a work RVU of 15.94 based on a
crosswalk to CPT code 65730 (Keratoplasty (corneal transplant);
penetrating (except in aphakia or pseudophakia)). The RUC recommended a
work RVU of 16.70, which is the current work RVU of the RUC's crosswalk
code 67108 (Repair of retinal detachment; with vitrectomy, any method,
including, when performed, air or gas tamponade, focal endolaser
photocoagulation, cryotherapy, drainage of subretinal fluid, scleral
buckling, and/or removal of lens by same technique) after the
efficiency adjustment was applied at the start of CY 2026. In reviewing
CPT code 27447, we noted that the recommended total time is decreasing
from 374 minutes to 305 minutes (19 percent reduction); however, the
RUC-recommended work RVU is only decreasing from 19.11 to 16.70, which
is a reduction of 13 percent. While we do not believe that the decrease
in time as reflected in survey values should always equate to a one-to-
one or linear decrease in newly valued work RVUs we do believe that,
since the two components of work are time and intensity, absent an
obvious or explicitly stated rationale for why the relative intensity
of a given procedure has increased, significant decreases in time
should be reflected in decreases to work RVUs although not necessarily
in a linear manner.
More specifically, CPT code 27447 was identified by the RAW as
having a site of service anomaly in which the service was performed
less than 50 percent of the time in the inpatient setting yet included
inpatient hospital Evaluation and Management services within the global
period. The RUC has recommended the removal of two inpatient hospital
visits, a decrease from a full to a half discharge visit, along with
recommending a decrease of 7 minutes to the intraservice work time
based on the survey. We do not believe that the RUC's recommended work
decrease of just over two RVUs appropriately captures this decrease in
procedure time and practitioner work for CPT code 27447. We also
noticed that the RUC's recommended work RVU of 16.70 results in an
intensity increase for CPT code 27447. We disagree that an increase in
intensity for this code is warranted, particularly given that the
typical case for the procedure is moving from the inpatient to
outpatient setting. The code descriptor for CPT code 27447 also remains
unchanged which suggests that there has been no significant change in
the procedure's performance or intensity. Furthermore, we also found
that the recommended work RVU of 16.70 was higher than nearly all of
the other 90 day global codes with similar time values, and we do not
believe that this type of total knee arthroplasty procedure, which is
typically done on a routine and elective basis, would warrant an
intensity and work valuation at the very top of the scale relative to
other 90 day globals with similar time values. We are therefore
proposing a work RVU of 15.94 based on a crosswalk to CPT code 65730
which preserves the current intensity of CPT code 27447 and better
maintains relativity with the rest of the PFS.
We are proposing the RUC-recommended direct PE inputs for CPT code
27447 without refinement.
(11) Implantation of Extra-Articular Shock Absorber--Medial Knee (CPT
Code 27X05)
At the September 2025 CPT Editorial Panel Meeting, CPT created a
new Category I code to describe the implantation of a medial knee
extra-articular shock absorber. CPT code
[[Page 43876]]
27X05 (Implantation of medial knee extra-articular shock absorber,
including fluoroscopic guidance) was surveyed at the January 2026 RUC
meeting.
We are proposing the RUC-recommended work RVU of 13.16 for CPT code
27X05. We are proposing the RUC-recommended direct PE inputs for CPT
code 27X05 without refinement.
(12) Osteochondral Acellular Scaffold Implantation, Knee (CPT Code
27XX8)
At the September 2025 CPT Editorial Panel Meeting, CPT created a
new Category I CPT code 27XX8 (Acellular scaffold(s) (e.g., aragonite)
implant(s), for osteochondral lesion(s), knee, open), which describes
open cartilage knee repair procedures with an acellular scaffold
implant. Based on the inorganic nature of these implants, the CPT
Editorial Panel included the term ``acellular scaffold'' in the code
descriptor for 27XX8, as it is a more comprehensive term and further
defines the types of regenerative implants being used that are neither
autologous nor allogenic. The CPT Editorial Panel did not request
deletion for existing Category III code 0737T, which is currently being
reported for this procedure, since it may appropriately describe
procedures with this type of implant joints other than the knee. CPT
code 27XX8 was surveyed for the January 2026 RUC meeting.
We are proposing the RUC-recommended work RVU of 9.53 for CPT code
27XX8.We are proposing the RUC-recommended direct PE inputs for CPT
code 27XX8 without refinement.
(13) Cardiac Contractility Modulation (CPT Codes 33X01, 33X02, 33X03,
33X04, 33X05, 33X06, 33X07, 33X08, 33X09, 33X10, 33X11, 93X01, 93X02,
93X03, and 93X04)
In May 2025, the CPT Editorial Panel approved a new family of 11
Category I CPT codes for insertion, removal, and replacement of cardiac
contractility modulation (CCM) systems, generators, and leads in
several combinations. A separate set of four codes was created to
describe the corresponding CCM programming, interrogation, and remote
interrogation services. All 11 of the insertion, removal, and
replacement/repositioning/revision CCM codes, as well as three
programming, interrogation, and remote interrogation CCM services that
involve physician work, were surveyed for the September 2025 RUC
meeting.
The specialty societies detailed the four code subsets within the
CCM code family. These include CCM insertion services: CPT codes 33X01
(Insertion of permanent cardiac contractility modulation system,
including fluoroscopic guidance and programming of sensing and
therapeutic parameters, with evaluation when performed; pulse generator
and transvenous electrodes), 33X02 (Insertion of permanent cardiac
contractility modulation system, including fluoroscopic guidance and
programming of sensing and therapeutic parameters, with evaluation when
performed; pulse generator only), 33X03 (Insertion of permanent cardiac
contractility modulation system, including fluoroscopic guidance and
programming of sensing and therapeutic parameters, with evaluation when
performed; transvenous electrode, single), and 33X04 (Insertion of
permanent cardiac contractility modulation system, including
fluoroscopic guidance and programming of sensing and therapeutic
parameters, with evaluation when performed; transvenous electrode,
dual); CCM removal services: CPT code 33X05 (Removal of a permanent
cardiac contractility modulation system; pulse generator and
transvenous electrodes), 33X06 (Removal of a permanent cardiac
contractility modulation system; pulse generator only), 33X07 (Removal
of a permanent cardiac contractility modulation system; transvenous
electrode, single), and 33X08 (Removal of a permanent cardiac
contractility modulation system; transvenous electrode, dual); CCM
replacement, repositioning, and revision services: CPT code 33X09
(Removal and replacement of permanent cardiac contractility modulation
system, pulse generator only), 33X10 (Repositioning of previously
implanted cardiac contractility modulation transvenous electrode(s),
including fluoroscopic guidance and programming of sensing and
therapeutic parameters), and 33X11 (Relocation or revision of skin
pocket for implanted cardiac contractility modulation pulse generator);
and CCM programming, interrogation, and remote interrogation services:
CPT code 93X01 (Programming of the cardiac contractility modulation
system (in person) with iterative adjustment of the implantable device
to test the function of the device and select optimal permanent
programmed values with analysis, including review and report by a
physician or other qualified health care professional), 93X02
(Interrogation device evaluation (in person) with analysis, review and
report by a physician or other qualified healthcare professional,
includes connection, recording and disconnection per patient encounter,
implantable cardiac contractility modulation system), 93X03
(Interrogation device evaluation (remote), up to 90 days, cardiac
contractility modulation system with interim analysis, review and
report(s) by a physician or other qualified health care professional),
and 93X04 (Interrogation device evaluation (remote), up to 90 days,
cardiac contractility modulation system, remote data acquisition(s),
receipt of transmissions, technician review, technical support, and
distribution of results).
We are proposing the RUC-recommended work RVU for all of the codes
in this family. We are proposing a work RVU of 8.83 for CPT code 33X01,
work RVU of 5.66 for CPT 33X02, work RVU of 6.00 for CPT 33X03, work
RVU of 6.23 for CPT 33X04, work RVU of 9.90 for CPT 33X05, work RVU of
4.79 for CPT 33X06, work RVU of 7.30 for CPT 33X07, work RVU of 8.39
for CPT 33X08, work RVU of 6.00 for CPT 33X09, work RVU of 5.00 for CPT
33X10, work RVU of 5.12 for CPT 33X11, work RVU of 0.90 for CPT 93X01,
work RVU of 0.80 for CPT 93X02, and work RVU of 0.59 for CPT 93X03. We
note that several of these work RVUs were affected by the efficiency
adjustment which was applied at the start of CY 2026, as the RUC
recommendations were based on pre-adjustment work valuations. The RUC
did not recommend, and we are not proposing, a work RVU for CPT code
93X04.
We are proposing the RUC-recommended direct PE inputs for CPT codes
33X01-33X11 as well as for CPT codes 93X01-93X04 without refinement.
(14) Insertion and Removal of Surgical Ventricular Assist Device (CPT
Codes 33X12, 33X13, and 33X15)
At the September 2025 CPT Editorial Panel meeting, the CPT
Editorial Panel created three new category I CPT codes to describe the
insertion and removal of a left heart ventricular assist device (VAD),
specifically using an open arterial with conduit surgical approach.
These new category I CPT codes include the insertion CPT codes 33X15
(Insertion of left heart ventricular assist device, including
radiological supervision and interpretation, open; axillary, subclavian
or innominate artery exposure with creation of conduit by
infraclavicular or supraclavicular incision, unilateral) and 33X12
(Insertion of left heart ventricular assist device, including
radiological supervision and interpretation, open; aorta exposure with
creation of conduit
[[Page 43877]]
by transthoracic (e.g., median sternotomy, thoracotomy) incision) as
well as the removal CPT code 33X13 (Removal of left heart ventricular
assist device with resection and stapling of graft conduit and skin
closure (e.g., infraclavicular, supraclavicular).
We are proposing the RUC-recommended work RVU of 13.65 for CPT code
33X15, work RVU of 17.52 for CPT 33X12, and work RVU of 6.58 for CPT
33X13.
We are proposing the RUC-recommended direct PE inputs for CPT codes
33X15, 33X12, and 33X13 without refinement.
(15) Transcatheter Tricuspid Valve Implant, Edge-to-Edge Repair (CPT
Codes 33X50, 33X51, and 33X52)
In September 2025, the CPT Editorial Panel approved the addition of
CPT codes 33X50 (Transcatheter tricuspid valve implantation (TTVI)/
replacement with prosthetic valve, percutaneous approach, including
right heart catheterization, temporary pacemaker insertion, and
selective right ventricular or right atrial angiography, when
performed), CPT code 33X51 (Transcatheter tricuspid valve edge-to-edge
repair (T-TEER), percutaneous approach; initial clip), and CPT code
33X52 (Transcatheter tricuspid valve edge-to-edge repair (T-TEER),
percutaneous approach; each additional clip during same session). These
codes were surveyed for the January 2026 RUC meeting.
The RUC recommended the inclusion of an inpatient hospital visit
(CPT code 99233) within the global period of CPT codes 33X50 and 33X51,
despite the fact that both codes were recommended with 0 day global
periods. We disagree that this inpatient hospital visit should be
included within the valuation of these services, as 0 day global
periods are specifically defined to include only postoperative care
that takes place on the day of the procedure itself without
incorporating any postoperative days. We are therefore proposing to
remove the inpatient hospital visit (CPT code 99233) from both CPT
codes 33X50 and 33X51, including the removal of 55 minutes of
associated work time from each procedure.
We disagree with the RUC-recommended work RVU of 24.38 for CPT code
33X50 and we are instead proposing a work RVU of 17.52 based on a
crosswalk to CPT code 95391 (Percutaneous transcatheter closure of
paravalvular leak; initial occlusion device, aortic valve). Our review
of CPT code 33X50 found that the RUC's recommended work RVU of 24.38
placed it far higher than any other 0-day global code with similar time
values on the PFS, especially after accounting for the removal of the
work time associated with the inpatient hospital visit described
earlier in this section. Most codes with 120 minutes of intraservice
time and approximately 220 minutes of total time were valued around a
work RVU of 13.00-15.00 and there were zero codes valued higher than a
work RVU of 17.52. While we concur that CPT code 33X50 is a difficult
and intensive procedure to perform, we do not believe it is accurately
valued at 7 RVUs higher than any other code with comparable time
values. We are instead proposing a work RVU of 17.52 based on a
crosswalk to CPT code 95391, the highest 0-day global valuation with
comparable work times, as this will avoid distorting relativity with
other services on the PFS. We also note that CPT code 33X50 has
comparable intensity at our proposed work RVU to the top reference code
from the survey, CPT code 33477, which we believe better serves
relativity than the RUC's recommended work RVU. The RUC's recommended
work RVU of 24.38 would result in an intensity for CPT code 33X50
nearly 50 percent higher than the already complex and difficult
transcatheter pulmonary valve implantation procedure described in the
reference code, which we do not believe would be typical.
For CPT code 33X51, we disagree with the RUC's recommended work RVU
of 23.92 and we are instead proposing a work RVU of 17.06. Although we
disagree with the RUC-recommended work RVU for CPT 33X51, we concurred
that the relative difference in work between CPT codes 33X50 and 33X51
is equivalent to the recommended interval of 0.46 RVUs. Therefore, we
are proposing a work RVU of 17.06 for CPT code 33X51, based on the
recommended interval of 0.46 below our proposed work RVU of 17.52 for
CPT code 33X50.
For CPT code 33X52, we disagree with the RUC-recommended work RVU
of 8.00 and we are instead proposing a work RVU of 6.34 based on a
crosswalk to CPT 22552 (Arthrodesis, anterior interbody, including disc
space preparation, discectomy, osteophytectomy and decompression of
spinal cord and/or nerve roots; cervical below C2, each additional
interspace (List separately in addition to code for primary procedure).
Our review of CPT code 33X52 found that the RUC's recommended work RVU
of 8.00 placed it far higher than almost any other add-on code with
similar time values on the PFS, with the sole exception of CPT code
61642 (Balloon dilatation of intracranial vasospasm, percutaneous; each
additional vessel in different vascular territory which is an outlier
valuation at a work RVU of 8.66. Most add-on codes with approximately
50 minutes of total time were valued around a work RVU of 3.00-5.00 and
there was only a single code valued higher than a work RVU of 6.34.
While we concur that CPT code 33X52 is a difficult and intensive
procedure to perform, we do not believe it is accurately valued at
nearly two RVUs higher than other codes with comparable time values. We
are instead proposing a work RVU of 6.34 based on a crosswalk to CPT
code 22522, the highest non-outlier add-on code valuation with
comparable work times, as this will avoid distorting relativity with
other services on the PFS. We note that this valuation will also
maintain relative intensity between CPT code 33X52 and the first two
codes in the family at our proposed work RVUs.
The RUC did not recommend and we are not proposing any direct PE
inputs for the three codes in this family.
(16) Percutaneous Transcatheter Closure (CPT Code 33340)
In April 2025, the RAW identified CPT code 33340 (Percutaneous
transcatheter closure of the left atrial appendage with endocardial
implant, including fluoroscopy, transseptal puncture, catheter
placement(s), left atrial angiography, left atrial appendage
angiography, when performed, and radiological supervision and
interpretation) as a code that has Medicare utilization of 10,000 or
more that has increased by at least 100 percent from 2018 through 2023.
The specialty societies indicated and the RUC agreed that CPT code
33340 be surveyed for the January 2026 RUC meeting.
We disagree with the RUC's recommendation of the current work RVU
of 9.99 for CPT code 33340 and we are instead proposing a work RVU of
9.00 based on crosswalk to CPT code 37271 (Revascularization,
endovascular, open or percutaneous, femoral and popliteal vascular
territory, with transluminal atherectomy, including transluminal
angioplasty when performed, including all maneuvers necessary for
accessing and selectively catheterizing the artery and crossing the
lesion, including all imaging guidance and radiological supervision and
interpretation necessary to perform the atherectomy and angioplasty
when performed, within the same artery, unilateral; straightforward
lesion, initial vessel). The RUC survey indicated that the typical time
needed to perform CPT code 33340 has decreased, with the
[[Page 43878]]
intraservice time decreasing from 70 minutes to 62 minutes and the
total time decreasing from 165 minutes to 154 minutes. While we do not
believe that the decrease in time as reflected in survey values should
always equate to a one-to-one or linear decrease in newly valued work
RVUs we do believe that, since the two components of work are time and
intensity, absent an obvious or explicitly stated rationale for why the
relative intensity of a given procedure has increased, significant
decreases in time should be reflected in decreases to work RVUs
although not necessarily in a linear manner. The RUC's recommendation
to maintain the current work RVU of 9.99 for CPT code 33340 can only be
justified if the intensity to perform the service has increased over
time. However, there has been no change to the code descriptor for CPT
code 33340 and no apparent change in clinical practice which would
warrant the roughly 15 percent increase in intensity as recommended by
the RUC. Since we do not believe that there is evidence indicating that
CPT code 33340 has typically become more intense to perform, we are
therefore proposing a work RVU of 9.00 which maintains the current
intensity of the service. This valuation is based on a crosswalk to CPT
code 37271, a recently reviewed service from CY 2026 that has a higher
intraservice time and nearly identical total time.
We are proposing the direct PE inputs for CPT code 33340 as
recommended by the RUC without refinement.
(17) Treatment of Incompetent Veins (CPT Codes 36470, 36471, 36465,
36466, 36473, and 36474)
In April 2025, the RAW identified CPT code 36465 (Injection of non-
compounded foam sclerosant with ultrasound compression maneuvers to
guide dispersion of the injectate, inclusive of all imaging guidance
and monitoring; single incompetent extremity truncal vein (e.g., great
saphenous vein, accessory saphenous vein), as a code that has Medicare
utilization of 10,000 or more that has increased by at least 100
percent from 2018 through 2023. The RAW reviewed the action plan and
the RUC recommended CPT code 36465 along with the family of services be
surveyed for the January 2026 RUC meeting.
The RUC reviewed this family of services at the January 2026
meeting including all sclerosant treatment of incompetent veins. These
services are: CPT code 36465; CPT code 36466 (Injection of non-
compounded foam sclerosant with ultrasound compression maneuvers to
guide dispersion of the injectate, inclusive of all imaging guidance
and monitoring; multiple incompetent truncal veins (e.g., great
saphenous vein, accessory saphenous vein), same leg); CPT code 36470
(Injection of sclerosant; single incompetent vein (other than
telangiectasia)); CPT code 36471 (Injection of sclerosant; multiple
incompetent veins (other than telangiectasia), same leg); CPT code
36473 (Endovenous ablation therapy of incompetent vein, extremity,
inclusive of all imaging guidance and monitoring, percutaneous,
mechanochemical; first vein treated); and CPT code 36474 (Endovenous
ablation therapy of incompetent vein, extremity, inclusive of all
imaging guidance and monitoring, percutaneous, mechanochemical;
subsequent vein(s) treated in a single extremity, each through separate
access sites (List separately in addition to code for primary
procedure)).
For CY 2027, we are proposing the RUC-recommended work RVUs for
five of the six codes in this family. We are proposing the RUC-
recommended work RVU of 2.29 for CPT code 36465, 0.73 for CPT code
36470, 1.18 for CPT code 36471, 3.41 for CPT code 36473, and 1.71 for
CPT code 36474.
We disagree with the RUC recommended work RVU of 2.93 for CPT code
36466. Instead, we are proposing a work RVU of 2.62 based on a
crosswalk to CPT code 57156 (Insertion of a vaginal radiation
afterloading apparatus for clinical brachytherapy). In reviewing CPT
code 36466, we noted that the recommended intraservice time is
decreasing from 35 minutes to 30 minutes (14 percent reduction), and
the recommended total time is decreasing from 76 minutes to 68 minutes
(11 percent reduction); however, the RUC recommended maintaining the
current work RVU of 2.93. While we do not believe that the decrease in
time as reflected in survey values should always equate to a one-to-one
or linear decrease in newly valued work RVUs we do believe that, since
the two components of work are time and intensity, absent an obvious or
explicitly stated rationale for why the relative intensity of a given
procedure has increased, significant decreases in time should be
reflected in decreases to work RVUs although not necessarily in a
linear manner. The RUC's recommendation to maintain the current work
RVU of 2.93 for CPT code 36466 can only be justified if the intensity
to perform the service has increased over time. However, there has been
no change to the code descriptor for CPT code 36466 and no apparent
change in clinical practice which would warrant the roughly 17 percent
increase in intensity as recommended by the RUC. Since we do not
believe that there is evidence indicating that CPT code 36466 has
typically become more intense to perform, we are therefore proposing a
work RVU of 2.62 which maintains the current intensity of the service.
This valuation is based on a crosswalk to CPT code 57156, which has the
same intraservice work time of 30 minutes and higher total time.
We are proposing the RUC-recommended direct PE inputs for all CPT
codes in this family without refinement.
(18) Microvascular Bypass, Lymphatic Vessels (CPT Codes 38X03 and
38X04)
In September 2025, the CPT Editorial Panel approved two new
Category I codes to describe microvascular bypass of lymphatic vessels,
a microsurgical procedure. This newly created Category I CPT code
family describes two services: a base code for the initial anastomosis,
CPT code 38X03 (Microvascular anastomosis between a single vein opening
and any number of lymphatic vessels, per limb; initial anastomosis),
and the add-on code for each additional anastomosis, CPT code 38X04
(Microvascular anastomosis between a single vein opening and any number
of lymphatic vessels, per limb; initial anastomosis; each additional
anastomosis (List separately in addition to code for primary
procedure)). CPT codes 38X03 and 38X04 were surveyed for the January
2026 RUC meeting.
We reviewed the RUC's recommended work valuations and found the
RUC's recommended work RVU of 16.00 for CPT code 38X03 to be high,
based on a search of similarly timed codes in the RUC database. For CY
2027 we are proposing a work RVU of 14.00, based on the RUC survey 25th
percentile, for CPT code 38X03. We are proposing the RUC recommended
work RVU of 6.00 for CPT code 38X04. We are proposing the RUC-
recommended direct PE inputs for both CPT codes without refinement.
(19) Diaphragmatic Hernia Repair (CPT Codes 39540, 39541, 39XX3, 39XX4,
39XX5, 39XX7, 39XX8, 39XX9, 39X11, 39X12, and 39X13)
At the September 2025 CPT Editorial Panel, the committee revised
two existing CPT codes, CPT code 39540 (Repair, diaphragmatic hernia
(other than neonatal), via laparotomy; traumatic, acute) and CPT code
39541 (Repair, diaphragmatic hernia (other than neonatal), via
laparotomy; traumatic, chronic), describing diaphragmatic hernia
repair. They also created nine new Category I codes, CPT
[[Page 43879]]
codes 39XX3 (Repair, diaphragmatic hernia (other than neonatal), via
laparotomy; nontraumatic (ie, Bochdalek, Morgagni)), 39XX4 (Repair,
diaphragmatic hernia (other than neonatal), via thoracotomy; traumatic,
chronic), 39XX5 (Repair, diaphragmatic hernia (other than neonatal),
via thoracotomy; nontraumatic (ie, Bochdalek, Morgagni)), 39XX7
(Laparoscopy, surgical, with repair of diaphragmatic hernia (other than
neonatal); traumatic, acute), 39XX8 (Laparoscopy, surgical, with repair
of diaphragmatic hernia (other than neonatal); traumatic, chronic),
39XX9 (Laparoscopy, surgical, with repair of diaphragmatic hernia
(other than neonatal); nontraumatic (ie, Bochdalek, Morgagni)),
39X11(Thoracoscopy surgical, with repair of diaphragmatic hernia (other
than neonatal); traumatic, chronic), 39X12 (Thoracoscopy surgical, with
repair of diaphragmatic hernia (other than neonatal); nontraumatic (ie,
Bochdalek, Morgagni)), and 39X13 (Implantation of mesh or other
prosthesis with open, laparoscopic, or thoracoscopic diaphragmatic
hernia repair (List separately in addition to code for primary
procedure)) that expanded the range of surgical interventions included
in this code family. The RUC reviewed these services at the January
2026 meeting.
For CY 2027, we are proposing the RUC recommended work RVUs of
24.00 for CPT code 39540, 26.00 for CPT code 39541, 25.75 for CPT code
39XX3, 26.41 for CPT code 39XX4, 25.94 for CPT code 39XX5, 22.04 for
CPT code 39XX7, 26.60 for CPT code 39XX8, 27.00 for CPT code 39XX9,
25.44 for CPT code 39X11, 25.94 for CPT code 39X12, and 3.00 for CPT
code 39X13.
We are proposing the RUC-recommended direct PE inputs for all CPT
codes in this family without refinement.
(20) Diaphragm Repair (CPT Codes 39545 and 395X2)
In May 2025, the CPT Editorial Panel revised CPT code 39545
(Plication of diaphragm for eventration or paralysis, via thoracotomy)
to specify plication of the diaphragm for eventration or paralysis, via
thoracotomy, and created CPT code 395X2 (Thoracoscopy, surgical, with
plication of diaphragm for eventration or paralysis) to report
thoracoscopic plication of the diaphragm for eventration or paralysis.
For CY 2027, we are proposing the RUC recommended work RVUs of
18.45 for CPT code 39545 and 20.00 for CPT code 395X2. We are proposing
the RUC-recommended direct PE inputs for both CPT codes without
refinement.
(21) Division of Median Arcuate Ligament (CPT Codes 39XX1 and 39XX2)
In February 2025, the CPT Editorial Panel created two new codes to
report open and laparoscopic median arcuate ligament syndrome (MALS)
treatment: CPT code 39XX1 (Division of median arcuate ligament and
release of celiac trunk, with ganglionectomy, when performed) and CPT
code 39XX2 (Laparoscopy, surgical, with division of median arcuate
ligament and release of celiac trunk, with ganglionectomy, when
performed). The two new codes were surveyed for the April 2025 RUC
meeting.
We are proposing the RUC-recommended efficiency adjusted work RVUs
of 26.41 for CPT code 39XX1 and 25.94 for CPT code 39XX2. We are
proposing the RUC-recommended direct PE inputs for CPT codes 39XX1 and
39XX2 without refinement.
(22) Endoscopic Submucosal Dissection (CPT Codes 4XX01 and 4XX02)
At the May 2025 CPT Editorial Panel Meeting, two new CPT codes were
created for reporting endoscopic submucosal dissection (ESD) of both
the upper and lower GI tract, including mucosal closure: CPT codes
4XX01 (Endoscopic submucosal dissection (ESD) of upper gastrointestinal
tract, including mucosal closure, when performed) and 4XX02 (Endoscopic
submucosal dissection (ESD) of lower gastrointestinal tract, including
mucosal closure, when performed). These new CPT codes were surveyed at
the September 2025 AMA RUC meeting.
For CY 2027, we are proposing the RUC-recommended work RVUs of
15.00 for CPT code 4XX01 and 16.38 for CPT code 4XX02. We are proposing
the RUC-recommended direct PE inputs for CPT codes 4XX01 and 4XX02
without refinement.
(23) Transoral Oropharyngeal Procedures (CPT Codes 42808, 42XX1, and
42XX2)
In February 2025, the CPT Editorial Panel approved two new Category
I codes that describe transoral endoscopic surgery under magnification
for the removal of tumors in the oropharynx, including robotic
assistance when performed: CPT code 42XX1 (Transoral removal of
oropharyngeal and/or pharyngeal neoplasm under magnification (e.g.,
microscope or telescope), includes robotic assistance, when performed,
tongue base) and CPT code 42XX2 (Transoral removal of oropharyngeal
and/or pharyngeal neoplasm under magnification (e.g., microscope or
telescope), includes robotic assistance, when performed; tongue base;
lateral pharyngeal wall, including tonsil). CPT code 42808 (Excision or
destruction of lesion of pharynx, without magnification, any method)
was revised to clarify that it is done without magnification, and it
was surveyed along with the two new codes at the April 2025 RUC
meeting.
We are proposing the RUC-recommended work RVU for all three codes
in this family. We are proposing a work RVU of 2.29 for CPT code 42808
(which is the current work RVU of the code after the efficiency
adjustment was applied at the start of CY 2026), a work RVU of 20.00
for CPT code 42XX1, and a work RVU of 20.05 for CPT code 42XX2. We note
that the RUC's recommended work RVU of 2.29 for CPT code 42808 assigns
an intensity value of zero for this service; we are seeking comment
from interested parties as to whether an alternate work valuation, such
as the survey 25th percentile work RVU of 2.70, would be more
appropriate.
We are proposing the RUC-recommended direct PE inputs for all three
codes without refinement.
(24) Congenital Duodenal Obstruction Repair (CPT Codes 44XX1 and 44XX2)
At the May 2025 CPT Editorial Panel Meeting, two new CPT codes were
created for reporting surgical treatment for congenital duodenal
obstruction via an open or laparoscopic approach, that were previously
reported using unlisted codes: CPT codes 44XX1 (Duodenoduodenostomy or
duodenojejunostomy for congenital duodenal obstruction) and 44XX2
(Laparoscopy, surgical; duodenoduodenostomy or duodenojejunostomy for
congenital duodenal obstruction). These new CPT codes were surveyed at
the September 2025 AMA RUC meeting.
For CY 2027, we are proposing the RUC-recommended work RVUs of
50.00 for CPT code 44XX1 and 52.60 for CPT code 44XX2. We are proposing
the RUC-recommended direct PE inputs for CPT codes 44XX1 and 44XX2
without refinement.
(25) Irreversible Electroporation of Tumor, Pancreas (CPT Code 48XXX)
In May 2025, the CPT Editorial Panel approved the addition of a new
CPT code 48XXX (Ablation, irreversible electroporation of tumor(s) of
the pancreas, open, including imaging guidance) to report open
irreversible electroporation (IRE) ablation of tumors of the pancreas.
[[Page 43880]]
We are proposing the RUC-recommended work RVU of 25.19 for CPT code
48XXX, and the RUC-recommended direct PE inputs without refinement.
(26) Prostate Biopsy Services (CPT Codes 55705, 55707, 55708, 55709,
55710, 55711, 55712, 55714, and 55715)
This service was identified via the April 2022 RAW review of
services performed by the same physician on the same date of service 75
percent of the time or more and was surveyed for the September 2024 RUC
meeting. The data from the September 2024 survey indicated that the
long descriptors did not adequately describe these services. While the
codes were valued for the CPT 2026 cycle, the specialties and the RUC
agreed that a new coding change application should be developed for the
CPT Editorial Panel for restructuring in the CPT 2027 cycle. CPT
revised the prostate biopsy code family in 2026 and it was surveyed for
the January 2026 RUC meeting. The revisions to the family are as
follows: CPT codes 55705 (Biopsy, prostate, any approach, non-imaging
guided), 55707 (Biopsy, prostate, transrectal, including imaging
guidance, regional), 55708 (Biopsy, prostate, transrectal, including
imaging guidance, regional and fusion-targeted lesion(s)), 55709
(Biopsy, prostate, transperineal, including imaging guidance,
regional), 55710 (Biopsy, prostate, transperineal, including imaging
guidance, regional and of fusion-targeted lesion(s), 76872 (ultrasound,
transrectal), and 55714 (Biopsy, prostate, including imaging guidance,
in-bore-CT-or-MRI-guided; first targeted lesion) have work RVUs that
were reaffirmed from CY 2026 by the RUC. CPT codes 55711 (Biopsy,
prostate, transrectal or transperineal, including imaging guidance,
fusion), 5XX14 (Biopsy, prostate, transrectal or transperineal,
including imaging guidance, fusion-targeted lesion(s) without regional;
each additional targeted lesion (List separately in addition to code
for primary procedure) and 55715 (Biopsy, prostate, including imaging
guidance, in-bore CT- or MRI-guided; each additional targeted lesion
(List separately in addition to code for primary procedure)) are new
and/or revised codes for CY2027.
For CY 2027, we are proposing the RUC-recommended work RVU for
eight of the nine codes in the family. We are proposing the RUC-
recommended work RVUs of 1.88 for CPT code 55705, 2.63 for CPT code
55707, 3.39 for CPT code 55708, 3.23 for CPT code 55709, 3.81 for CPT
code 55710, 2.37 for CPT code 55711, 3.62 for CPT code 55714, and 1.80
for CPT 55715.
For CPT code 5XX14, we disagree with the RUC-recommended work RVU
of 0.80. In the interest of maintaining relativity with similarly timed
codes, we are instead proposing a work RVU of 0.68 based on a crosswalk
to CPT code 93567 (Injection procedure during cardiac catheterization
including imaging supervision, interpretation, and report; for
supravalvular aortography (List separately in addition to code for
primary procedure)). CPT code 55X14 was surveyed with only 6 minutes of
intraservice and total work time, yet the RUC recommended a work RVU of
0.80. We compared this recommended valuation against CPT code 55715,
another add-on code within this same family, which was surveyed at 35
minutes of intraservice and total work time but with a recommended work
RVU of 1.80. This results in CPT code 55X14 having an intensity nearly
triple that of CPT code 55715 which we do not believe would be typical.
We also found that there were no other add-on codes in the RUC database
with comparable time values to CPT code 55X14 which had a work RVU
approaching 0.80. The closest was CPT code 77063 (Screening digital
breast tomosynthesis, bilateral) at a work RVU of 0.59, with that code
having 8 minutes of work time instead of 6 minutes, and all other
comparable add-on codes had a work RVU of 0.37 or lower. Although we
agree that CPT code 55X14 is a difficult and intensive procedure, we
believe that the RUC's recommended work RVU of 0.80 assigns too much
work valuation and intensity to the service, and does not maintain
relativity with other related codes on the PFS.
We are instead proposing a work RVU of 0.68 for CPT code 5XX14
based on a crosswalk to CPT code 93567. Our proposed work RVU of 0.68
is also supported with add-on CPT codes with similar work time values.
CPT code 93566 (Injection procedure during cardiac catheterization
including imaging supervision, interpretation, and report; for
selective right ventricular or right atrial angiography (List
separately in addition to code for primary procedure)) is valued at a
work RVU of 0.49 with an intraservice time of 10 minutes and CPT code
64484 (Injection(s), anesthetic agent(s) and/or steroid; transforaminal
epidural, with imaging guidance (fluoroscopy or CT), lumbar or sacral,
each additional level (List separately in addition to code for primary
procedure)) is valued at a work RVU of 0.98 with an intraservice time
of 10 minutes.
We are proposing the RUC-recommended direct PE inputs for all CPT
codes in this family without refinement.
(27) Maternity Care Services (CPT Codes 59320, 59325, 59412, 59871,
59XX1, 59XX2, 59XX3, 59XX4, 59030, 59051, 59XX5, 59XX6, 59414, 59300,
59XX7, 59XX8, 59XX9, 59X10, 59X11, 59X12, and 59160)
a. Background and Proposal
At the January 2026 AMA RUC meeting, the maternity global codes
were revised to delete 17 legacy CPT codes, create 12 new CPT codes,
and revise 9 CPT codes describing maternity care services. See Table A-
D2 for a summary of the codes and their long descriptors. These codes
were restructured from the MMM global period to individual codes to
reflect changes in practice. The previous MMM global period included 12
prenatal E/M visits bundled into CPT codes 59400, 59510, 59610, and
59618. In May 2025, the American College of Obstetricians and
Gynecologists (ACOG) published new clinical guidelines, recommending
that obstetrician-gynecologists and other maternity care professionals
tailor the visit frequency and monitoring schedule to the needs of the
pregnant woman. These new clinical guidelines provide a sample schedule
for prenatal care services and visit frequency, which describes 8
visits for average-risk pregnant women without medical or pregnancy
complications, and 13 visits for pregnant women with greater-than-
average risk. This sample schedule specifies that additional services
may be offered as needed throughout the pregnancy.
When the RUC reviewed these codes, they included 12 prenatal E/M
visits (two level 2 established patient office visits, eight level 3
established patient office visits, and two level 4 established patient
office visits) in the calculations to make these changes budget-neutral
despite the revisions to the clinical guidelines suggesting that 12
visits would no longer be typical. As the clinical guidelines have
changed to reflect a revised assumption about the typical number of
visits, estimating work neutrality based on the assumption that all 12
prenatal E/M visits in the base year would be reported in the
predictive year overestimates the total utilization and as a result,
undervalues the work RVUs as recommended by the RUC. To improve payment
accuracy of the new codes, we are proposing to refine the RUC's
recommended utilization crosswalk to remove four E/M visits (two level
2
[[Page 43881]]
established patient office visits and two level 4 established patient
office visits) from the utilization estimate calculation and reallocate
those RVUs within the code family to the new labor and delivery codes.
This would mean reallocating 11,810 additional work RVUs to the new
labor and delivery codes (CPT codes 59XX1-59XX8). Since the RUC
provided a utilization estimate of 12,791 for CPT codes 59XX1-59XX8,
this would result in a 15 percent increase in work RVUs for each labor
and delivery code. We would like to emphasize that we are not endorsing
a reduced number of prenatal visits for pregnant women. Our
recalculation of the utilization estimates in the valuation of these
services should not be used to determine the appropriate number of
visits to provide reasonable and necessary care to beneficiaries. As
with all PFS services, maternity services should be furnished when
medically reasonable and necessary.
There are no RUC-recommended direct PE inputs for these CPT codes.
Table A-D2 also shows the RUC-recommended and CMS proposed work RVUs
for the 21 CPT codes.
[GRAPHIC] [TIFF OMITTED] TP16JY26.020
b. Comment Solicitation on Maintaining Current Coding Through Creation
of HCPCS G-codes
We are interested in thinking about different approaches to how
maternity care codes are valued and paid under the PFS. Although the
RUC asserts that these proposed coding changes discussed above reflect
clinical consensus, we have concerns that our adoption of the new codes
would be disruptive based on how the longstanding existing code
structure is currently accounted for in clinical practice patterns. We
are seeking comment on whether CMS should create HCPCS G-codes that
would maintain the current coding and payment for maternity services to
ameliorate this concern, while we continue to consider the potential
impact that changes in the maternity care code family have on clinical
outcomes for maternal care. These codes would be used in lieu of
adoption of the new CPT codes for purposes of Medicare payment. We are
specifically interested in additional information to support or oppose
this concern, as well as additional information to support or oppose
the use of the creation of HCPCS G-codes in lieu of adoption of the new
CPT codes.
Specifically, for payment for maternity care services under the
PFS, we are considering, and are seeking comment on, the creation of 15
new HCPCS G-Codes for CY 2027 that reflect the previous MMM global code
structure, with the code descriptors and work RVUs detailed in Table A-
D3, as an alternative to the revaluation of the codes as discussed in
Section (a), of this preamble. We are seeking public comment on these
HCPCS G-codes and, after consideration of public comment, could
finalize payment for these codes. We are seeking comment on these HCPCS
G-codes and are also seeking comment on any other HCPCS G-codes that
may be needed to reflect the necessary service elements for this code
family. These HCPCS G-codes would adopt all current conditions of
payment for the MMM global codes, as well as maintain the MMM global
period, if finalized.
[[Page 43882]]
[GRAPHIC] [TIFF OMITTED] TP16JY26.021
(28) Stereotactic Computer-Assisted Volumetric Navigation (CPT Codes
61781, 61782, and 61783)
In April 2024, CPT code 61783 (Stereotactic computer-assisted
(navigational) procedure; spinal (List separately in addition to code
for primary procedure)) was identified via the high-volume growth
screen. In January 2025, the RAW reviewed the action plan for CPT code
61783 and determined that this service should be surveyed with the
appropriate family of codes. The RUC recommended that CPT code 61781 be
surveyed with CPT codes 61782 (Stereotactic computer-assisted
(navigational) procedure; cranial, extradural (List separately in
addition to code for primary procedure)) and 61783 (Stereotactic
computer-assisted (navigational) procedure; spinal (List separately in
addition to code for primary procedure)) for September 2025.
We are proposing the RUC-recommended work RVU of 3.66 for CPT codes
61781 and 61783, and the RUC-recommended RVU of 2.06 for CPT code
61782. We note that all three of these RUC-recommended RVUs reflect the
application of the CY 2026 efficiency adjustment described in the CY
2026 PFS final rule (90 FR 49334 through 49345).
We are proposing the RUC's recommended direct PE inputs for CPT
code 61782. Since CPT codes 61781 and 61783 are performed in the
facility setting only, the RUC did not recommend, and we are not
proposing, any direct PE inputs for these two codes.
(29) Percutaneous Lumbar Decompression (CPT Code 62287)
At the January 2025 RUC meeting, the surveying societies requested
deletion of CPT code 62287 (Decompression, percutaneous, of nucleus
pulposus of intervertebral disc, any method utilizing needle-based
technique to remove disc material under fluoroscopic imaging or other
form of indirect visualization, with discography and/or epidural
injection(s) at the treated level(s), when performed, single or
multiple levels, lumbar) due to declining Medicare utilization. At the
May 2025 CPT Editorial Panel meeting, CPT reviewed additional
utilization estimates, and requests from neurosurgery and radiology
were received to resurvey and retain the code. CPT code 62287 was
surveyed at the September 2025 AMA RUC meeting since it was not deleted
in January 2025 with the other codes in the family.
We disagree with the RUC's recommended work RVU of 7.06 for CPT
code 62287 and we are instead proposing a work RVU of 6.23 based on a
crosswalk to CPT code 46707 (Repair of anorectal fistula with plug
(e.g., porcine small intestine submucosa [SIS])). We believe that the
RUC's recommended work RVU of 7.06 is an overestimation based on a
comparison to other codes with similar time values, particularly the
key reference code CPT code 22869 (Insertion of interlaminar/
interspinous process stabilization/distraction device, without open
decompression or fusion, including image guidance when performed,
lumbar; single level). There was a decrease in the surveyed work times,
such as the intraservice time decreasing from 60 minutes to 37 minutes,
which was not fully accounted for in the RUC's recommended work RVU of
7.06. We also note that the procedure does not seem to have become more
intense, as the code descriptor did not change.
In the interest of maintaining relativity with similarly timed
codes, we are instead proposing a work RVU of 6.23 based on a crosswalk
to CPT code 46707. This code has an almost identical intraservice time
and similar total time. The proposed work RVU accounts for the decrease
in both intraservice time and total time and is well bracketed by CPT
code 67912 (Correction of lagophthalmos, with implantation of upper
eyelid lid load (e.g., gold weight)), valued at a work RVU of 6.20 with
an intraservice time of 40 minutes, and CPT code 24358 (Tenotomy,
elbow, lateral or medial (e.g., epicondylitis, tennis elbow, golfer's
elbow); debridement, soft tissue and/or bone, open), valued at a work
RVU of 6.49 with an intraservice time of 40 minutes.
We are proposing the RUC-recommended direct PE inputs for all of
the codes in this family.
(30) Laminectomy (CPT Codes 63045, 63046, 63047, and 63048)
In April 2025, the RAW identified CPT code 63047 (Laminectomy,
facetectomy and foraminotomy
[[Page 43883]]
(unilateral or bilateral with decompression of spinal cord, cauda
equina and/or nerve root[s], [eg, spinal or lateral recess stenosis]),
single vertebral segment; lumbar) as a site of service anomaly where
Medicare data from 2021 to 2023 indicated it was performed less than 50
percent of the time in the inpatient setting yet included inpatient
hospital Evaluation and Management services within the global period
with 2023 Medicare utilization over 10,000. The RAW also worked with
the specialty societies and identified other codes 63045 (Laminectomy,
facetectomy and foraminotomy (unilateral or bilateral with
decompression of spinal cord, cauda equina and/or nerve root[s], [eg,
spinal or lateral recess stenosis]), single vertebral segment;
cervical), 63046 (Laminectomy, facetectomy and foraminotomy (unilateral
or bilateral with decompression of spinal cord, cauda equina and/or
nerve root[s], [eg, spinal or lateral recess stenosis]), single
vertebral segment; thoracic) and 63048 (Laminectomy, facetectomy and
foraminotomy (unilateral or bilateral with decompression of spinal
cord, cauda equina and/or nerve root[s], [eg, spinal or lateral recess
stenosis]), single vertebral segment; each additional vertebral
segment, cervical, thoracic, or lumbar (List separately in addition to
code for primary procedure)) as part of this family of services. These
services were surveyed for September 2025.
We are proposing the RUC-recommended work RVUs for all four CPT
codes in this family. We are proposing a work RVU of 17.25 for CPT code
63045, a work RVU of 16.71 for CPT code 63046, a work RVU of 14.99 for
CPT code 63047, and a work RVU of 3.38 for CPT code 63048. We note that
several of these work RVUs were affected by the efficiency adjustment
which was applied at the start of CY 2026, as the RUC recommendations
were based on pre-adjustment work valuations.
We are proposing the RUC recommended direct PE inputs for CPT codes
63045, 63046, 63047, and 63048 without refinement.
(31) Injection Anesthetic Agent (CPT Codes 64400 and 64405)
The RUC identified CPT code 64400 (Injection(s), anesthetic
agent(s) and/or steroid; trigeminal nerve, each branch (i.e.,
ophthalmic, maxillary, mandibular)) via their database flag, ``Do not
use to validate physician work'', and recommended to survey this CPT
code and the related CPT code 64405 (Injection(s), anesthetic agent(s)
and/or steroid; greater occipital nerve) for the September 2025
meeting.
For CY 2027, we are proposing the RUC-recommended work RVUs of 0.73
for CPT code 64400 (which is the current work RVU of the code after the
efficiency adjustment was applied at the start of CY 2026) and 0.84 for
CPT code 64405.
We are proposing the RUC-recommended direct PE inputs for both CPT
codes without refinement.
(32) MRA--Head, Neck (CPT Codes 70544, 70545, 70546, 70547, 70548,
70549, 70XX4, 70XX5, and 70XX6)
In April 2024, the RAW noted that the rate at which CPT codes 70547
(currently described as Magnetic resonance angiography, neck; without
contrast material(s)) and 70544 (currently described as Magnetic
resonance angiography, head; without contrast material(s)) are reported
together continued to increase after the initial identification of the
trend in April 2022 and a 2-year delay in review to allow practice
patterns in the inpatient and outpatient setting go back to how they
were prior to the COVID-19 pandemic. At the September 2025 CPT
Editorial Panel, six CPT codes were revised to include ``image
postprocessing'': CPT codes 70544 (Magnetic resonance angiography,
head, including image postprocessing; without contrast material(s)),
70545 (Magnetic resonance angiography, head, including image
postprocessing; with contrast material(s)), 70546 (Magnetic resonance
angiography, head, including image postprocessing; without contrast
material(s), followed by contrast material(s) and further sequences),
70547 (Magnetic resonance angiography, neck, including image
postprocessing; without contrast material(s)), 70548 (Magnetic
resonance angiography, neck, including image postprocessing; with
contrast material(s)), and 70549 (Magnetic resonance angiography, neck,
including image postprocessing; without contrast material(s), followed
by contrast material(s) and further sequences). Three additional codes
were created to bundle magnetic resonance angiography (MRA) head and
neck with/without contrast: CPT codes 70XX4 (Magnetic resonance
angiography, head and neck, including image postprocessing; without
contrast material(s)), 70XX5 (Magnetic resonance angiography, head and
neck, including image postprocessing; with contrast material(s)), and
70XX6 (Magnetic resonance angiography, head and neck; without
contrastmaterial(s) in one or both body regions, followed by contrast
material(s) and further sequences in one or both body regions,
including image postprocessing). The code family was surveyed for the
January 2026 RUC meeting.
We are proposing the RUC-recommended work RVU for all nine codes in
the family. We are proposing the RUC-recommended work RVUs of 1.17,
1.17, 1.44, 1.17, 1.46, 1.76, 1.77, 2.10, and 2.23 for CPT codes 70544,
70545, 70546, 70547, 70548, 70549, 70XX4, 70XX5, and 70XX6,
respectively. We are proposing the RUC recommended direct PE inputs for
CPT codes 70544, 70545, 70546, 70547, 70548, 70549, 70XX4, 70XX5, and
70XX6 without refinement.
(33) Computed Tomography-Upper Extremity With Contrast (CPT Codes
73200, 73201, and 73202)
In April 2025, the RAW identified CPT code 73201 (Computed
tomography, upper extremity; with contrast material(s)) via the CMS/
Other source and 2023 Medicare utilization over 20,000 screen. The
family of services was surveyed for the January 2026 RUC meeting,
including CPT codes 73200 (Computed tomography, upper extremity;
without contrast material) and 73202 (Computed tomography, upper
extremity; without contrast material, followed by contrast material(s)
and further sections).
We are proposing the RUC-recommended work RVUs of 1.00, 1.16, and
1.24 for CPT codes 73200, 73201, and 73202, respectively. We are
proposing the RUC recommended direct PE inputs for CPT codes 73200,
73201, and 73202 without refinement.
(34) Biofeedback Training (CPT Codes 90901, 90X03, 90912, and 90913)
CPT codes 90901 (Biofeedback training by any modality (e.g., EMG,
EEG, ECG); initial 15 minutes of direct patient contact by physician or
other qualified health care professional), 90912 (Biofeedback training,
perineal muscles, anorectal or urethral sphincter, including EMG and/or
manometry, when performed; initial 15 minutes of one-on-one physician
or other qualified health care professional contact with the patient)
and 90913 (Biofeedback training, perineal muscles, anorectal or
urethral sphincter, including EMG and/or manometry, when performed;
each additional 15 minutes of one-on-one physician or other qualified
health care professional contact with the patient (List separately in
addition to code for primary procedure)) were surveyed at the January
2026 RUC meeting after having gone through revision at the September
2025 CPT Editorial Panel. CPT revised code 90901 to describe the
[[Page 43884]]
initial 15 minutes of biofeedback training by a physician or other
qualified health care professional with direct patient contact and
created one new code, CPT code 90X03 (Biofeedback training by any
modality (e.g., EMG, EEG, ECG); each additional 15 minutes of direct
patient contact by physician or other qualified health care
professional (List separately in addition to code for primary
procedure)), to describe each additional 15 minutes. CPT codes 90912
and 90913 were surveyed for the January 2026 RUC meeting since they are
part of the same code family. CPT codes 90901 and new code 90X03 were
surveyed for the January 2026 RUC HCPAC Review Board meeting.
We are proposing the HCPAC-recommended work RVUs of 0.61 for CPT
code 90901 and 0.48 for CPT code 90X03. We are proposing the RUC-
recommended work RVUs of 0.90 for CPT code 90912 and 0.50 for CPT code
90913.
We are proposing the direct PE inputs recommended by the HCPAC and
the RUC for all four codes in the family without refinement.
CPT codes 90901, 90912, and 90913 are all designated as sometimes
therapy services, as such we are proposing to designate 90X03 as a
sometimes therapy service.
(35) Radiation Oncology Treatment Delivery (CPT Codes 77402, 77407, and
77412)
In the CY 2026 PFS final rule (90 FR 49379 through 49383), we
finalized our proposal to utilize the relationship between the Hospital
Outpatient Prospective Payment System (OPPS) Ambulatory Payment
Classifications (APC) relative weights for APCs 5621, 5622, and 5623 to
inform the valuation of PE-only CPT codes 77402 (Radiation treatment
delivery; Level 1 (e.g., single-electron field, multiple-electron
fields, or 2D photons), including imaging guidance, when performed),
77407 (Radiation treatment delivery; Level 2, single-isocenter (e.g.,
3D or IMRT), photons, including imaging guidance, when performed), and
77412 (Radiation treatment delivery; Level 3, multiple isocenters with
photon therapy (e.g., 2D, 3D, or IMRT) or a single-isocenter photon
therapy (e.g., 3D or IMRT) with active motion management, or total skin
electrons, or mixed-electron/photon field(s), including imaging
guidance, when performed) when paid under the PFS. We also stated that
we calculated the RVUs for these codes so that the overall PE and MP
RVUs for these services represent the same share of total PE and MP
RVUs in CY 2025 and CY 2026. To accomplish this, we developed PE and MP
RVUs using the assumed distribution of services indicated in the
utilization crosswalk.
We proposed to utilize the RUC-recommended crosswalk for these
services, which assumed that 45 percent of the billed charges would be
reported with CPT code 77412. Some commenters stated that CPT code
77412 would represent only 15 percent of the volume for these services.
We stated in the CY 2026 PFS final rule that it is difficult to
ascertain how services furnished in the past would be most accurately
reported using a future code set (90 FR 49385). In response to comments
and considering the disparate information we received, we finalized a
modified crosswalk that adjusted downward the estimated portion that
CPT code 77412 would be reported compared to CPT code 77407 based on
commenters who represent those who provide care in the non-facility
setting. Specifically, we modified the utilization crosswalk to
crosswalk 35 percent of the utilization to CPT code 77412 and 55
percent of the utilization to CPT code 77407. Since the publication of
the CY 2026 PFS final rule, interested parties have reported that the
35 percent utilization assumption for CPT code 77412 was still
overstated despite our downward adjustment in the CY 2026 PFS final
rule, and that the actual utilization for CPT code 77412 is
approximately 18 percent. Given the importance of the assumed
distribution of services in ensuring that we achieved our target of
maintaining the same share of total PE and MP RVUs, we reviewed the
claims data to evaluate the actual distribution of utilization among
CPT codes 77402, 77407, and 77412. We noted that during the first 3
months of 2026, CPT code 77412 comprised approximately 18 of the total
volume of these services.
Given that we valued these services by utilizing the relative
relationship between the OPPS APC relative weights rather than our
standard PE methodology, shifts in utilization over time are not
automatically incorporated into the annual development of PE RVUs for
these services over time. Consequently, we are proposing to refine the
relativity within this family of codes for CY 2027 based on available
claim data that corroborates the information submitted to us by outside
parties. We are not proposing to change the assumptions about the total
number of services, but rather, to revalue the PE RVUs using the
observed distribution of services, such that the PE and MP RVUs for
these services represent the same share of total PE and MP RVUs as they
did in CY 2025.
(36) Proton Beam Treatment Delivery (CPT Codes 77520, 77522, 77523, and
77525)
Payment amounts for proton beam treatment delivery services
described by CPT codes 77520 (Proton treatment delivery; simple,
without compensation), 77522 (Proton treatment delivery; simple, with
compensation), 77523 (Proton treatment delivery; intermediate), and
77525 (Proton treatment delivery; complex) are currently determined by
local Medicare Administrative Contractors (MACs). We have not
previously established RVUs for these services due to the unique nature
of the equipment costs associated with these services compared to other
capital costs addressed by our usual PE methodology. In the CY 2026 PFS
proposed rule, we sought comment on establishing national payment rates
for proton beam treatment delivery services. In the CY 2026 final rule
(90 FR 49390), we indicated our intent to establish national pricing
for proton beam treatment delivery services in future rulemaking.
Interested parties have raised concerns about wide geographic
payment disparities with the current contractor pricing that are
unrelated to the cost of providing care and have requested that CMS
nationally price proton beam treatment delivery services. For example,
2024 claims data for CPT code 77525, which has the second highest
utilization of the code family, reflects allowed charges that ranged
from $122.15 to $1,374.26. Interested parties recommended that CMS
establish identical payment rates for PFS and OPPS, calculating a
weighted average of the payment rates to maintain budget neutrality
across the PFS and OPPS. Other interested parties expressed concern
about reliance on OPPS cost data to value proton beam treatment
delivery services, as the substantial capital outlays required by
freestanding centers could be greater than those faced by hospital
systems and the freestanding centers lack the purchasing power or
amortization flexibility that hospitals may have.
After considering the comments we received in response to the CY
2026 PFS rule regarding establishing national payment rates for proton
beam treatment, similar to the policy we finalized for CY 2026 for
radiation treatment delivery services, we are proposing to calculate
the PE RVUs for these services as follows:
Use the total allowed charges paid by the MACs for CPT
codes 77520,
[[Page 43885]]
77522, 77523, and 77525 to establish the pool of PE RVUs to allocate to
the services in this code family.
Allocate PE RVUs to the individual services using the
relationship between the APC relative weights for APCs 5625 (to which
CPT codes 77522, 77523, and 77525 are assigned) and APC 5623 (to which
CPT code 77520 is assigned) under the OPPS. We believe our proposal
appropriately balances interested parties' requests to establish
national payment rates with the difficulties we have faced when
considering the capital-intensive and specialized resources for
services like proton beam therapy services.
(37) Intracoronary Drug Delivery Balloon Services (CPT Codes 9XX04 and
9XX07)
In May 2025, the CPT Editorial Panel created two new codes, CPT
code 9XX04 (Percutaneous transcatheter therapeutic drug delivery by
intracoronary drug-delivery balloon (e.g., drug-coated, drug-eluting),
including mechanical dilation by nondrug-delivery balloon angioplasty,
single major coronary artery and/or its branch(es)) and CPT code 9XX07
(Percutaneous transcatheter therapeutic drug-delivery by intracoronary
drug-delivery balloon (e.g., drug-coated, drug-eluting), single major
artery and/or its branches (List separately in addition to code for
primary procedure)) to describe percutaneous transcatheter therapeutic
drug delivery by intracoronary drug-delivery balloons. The RUC reviewed
these two new CPT codes at the September 2025 RUC meeting.
We reviewed the RUC's recommended work valuations and found the
RUC's recommended work RVU of 10.00 for CPT code 9XX04 to be high,
based on a search of 000 global day codes with between 45 and 75
minutes of intraservice time and between 109 and 149 minutes of total
time in the RUC database. For CY 2027 we are proposing a work RVU of
8.05, based on the RUC survey 25th percentile, for CPT code 9XX04. We
are proposing the RUC-recommended work RVU of 4.38 for CPT code 9XX07.
The RUC did not recommend, and we are not proposing any direct PE
inputs for these codes.
(38) Rotational Vestibular Assessment (CPT Codes 92XX5 and 92XX6)
At the September 2025 CPT Editorial Panel Meeting, CPT code 92546
was deleted, and replaced with two new codes to report rotational
vestibular assessment. The two new codes, CPT code 92XX5 (Rotational
vestibular assessment by sinusoidal harmonic acceleration (SHA) testing
with calibrated, computer-controlled chair, with interpretation and
report (do not report 92XX5 in conjunction with 92270)) and 92XX6
(Rotational vestibular assessment by sinusoidal harmonic acceleration
(SHA) testing with calibrated, computer-controlled chair, with
interpretation and report; with velocity step testing (VST) (List
separately in addition to code for primary procedure)) were surveyed
for the September 2025 RUC meeting.
We are proposing the RUC-recommended work RVU of 0.92 for CPT code
92XX5.
We disagree with the RUC's recommended value of 0.48 for CPT code
92XX6 and we are instead proposing a work RVU of 0.35 which is the
survey 25th percentile valuation. As valued by the RUC, the work RVU
for add-on CPT code 92XX6 is half of the RUC's recommended work RVU of
the base code (92XX5), despite the fact that CPT code 92XX6 has only 12
minutes of work time as compared with 45 minutes of work time for CPT
code 92XX5. This leads to the intensity of CPT code 92XX6 being valued
at double that of the base code, which we do not believe would be
typical given that the same SHA testing is taking place in both
services. We disagree with the RUC that valuing the work RVU of the
add-on CPT code 92XX6 at half the work of the base CPT code 92XX5 would
be appropriate, as this does not account for the substantial preservice
and postservice work time contained in CPT code 92XX5, which together
account for 20 of the 45 total minutes. We agree with the RUC that the
intensity of this code is higher than the base code, and our proposed
work RVU of 0.35 assigns a higher intensity to CPT code 92XX6 than CPT
code 92XX5, but we disagree that the intensity of the add-on service
would be double that of the base code.
We are proposing the RUC recommended direct PE inputs for CPT codes
92XX5 and 92XX6 without refinement.
Additionally, in the CY 2023 PFS final rule (87 FR 69656 through
69663) we created an exception to the physician order requirement at 42
CFR 410.32(a)(4) to allow patients to directly access audiologists. We
also delineated the vestibular function tests as those not applicable
for use with the AB modifier (for direct access)--see Audiology
Services on the PFS website at https://www.cms.gov/medicare/payment/fee-schedules/physician/audiology-services. Based on the foregoing, for
the new Rotational Vestibular Assessment Codes, CPT codes 92XX5 and
92XX6 will be added to the audiology services code list but they will
not be eligible to be billed with the AB modifier.
(39) Video Head Impulse--Vestibular Function (CPT Codes 92X10 and
92X11)
At the September 2025 CPT Editorial Panel, the committee approved
the addition of new CPT codes, 92X10 (Video head impulse testing (vhit)
with recording, interpretation and report of lateral semicircular canal
function) and 92X11 (Video head impulse testing (vhit) with recording,
interpretation and report of lateral and vertical semicircular canal
function) to report video head impulse testing (vHIT) and a
corresponding parenthetical note. The RUC reviewed these services at
the January 2026 meeting.
For CY 2027, we are proposing the RUC-recommended work RVUs of 0.53
for CPT code 92X10 and 0.84 for CPT code 92X11. We are proposing the
RUC-recommended direct PE inputs for both CPT codes without refinement.
(40) Speech-Language Pathology Services (CPT Codes 92X0X, 92X1X, 92X2X,
92X3X, 92X4X, 92X5X, 92X6X, 92X7X, 92X8X, 92X9X, and 92508)
At the September 2025 CPT Editorial Panel meeting, CPT code 92507
(Treatment of speech, language, voice, communication, and/or auditory
processing disorder; individual) was replaced with 10 new codes to
report fluency disorder, speech sound production disorder, language
comprehension and expression disorder, speech sound production disorder
and language comprehension and expression disorder, and voice, upper
airway dysfunction and/or resonance disorders. CPT codes 92X0X
(Treatment of fluency disorder (e.g., stuttering and cluttering),
direct (one-on-one) patient contact; initial 30 minutes), 92X1X
(Treatment of fluency disorder (e.g., stuttering and cluttering),
direct (one-on-one) patient contact; each additional 15 minutes (list
separately in addition to code for primary service)), 92X2X (Treatment
of speech sound production disorder (e.g., articulation, phonological
process, apraxia, dysarthria), direct (one-on-one) patient contact;
initial 30 minutes), 92X3X (Treatment of speech sound production
disorder (e.g., articulation, phonological process, apraxia,
dysarthria), direct (one-on-one) patient contact; each additional 15
minutes (list separately in addition to code for primary service)),
92X4X (Treatment of language comprehension and expression disorder
(e.g., receptive and expressive language), direct (one-on-one) patient
contact; initial 30 minutes), 92X5X (Treatment of language
comprehension
[[Page 43886]]
and expression disorder (e.g., receptive and expressive language),
direct (one-on-one) patient contact; each additional 15 minutes (list
separately in addition to code for primary service)), 92X6X (Treatment
of speech sound production disorder (e.g., articulation, phonological
process, apraxia, dysarthria) and language comprehension and expression
disorder (e.g., receptive and expressive language), direct (one-on-one)
patient contact; initial 30 minutes), 92X7X (Treatment of speech sound
production disorder (e.g., articulation, phonological process, apraxia,
dysarthria) and language comprehension and expression disorder (e.g.,
receptive and expressive language), direct (one-on-one) patient
contact; each additional 15 minutes (list separately in addition to
code for primary service)), 92X8X (Treatment of voice, upper airway
dysfunction, and/or resonance disorders, direct (one-on-one) patient
contact; initial 30 minutes), 92X9X (Treatment of voice, upper airway
dysfunction, and/or resonance disorders, direct (one-on-one) patient
contact; each additional 15 minutes (list separately in addition to
code for primary service)), and 92508 (Treatment of speech, language,
voice, communication, and/or auditory processing disorder, group, 2 or
more individuals) are new and/or revised codes for CY 2027.
Additionally, the introductory guidelines were revised to clarify
reporting of the services. The code family was surveyed for the January
2026 RUC HCPAC Review Board meeting.
For CY 2027, we are proposing the RUC-recommended work RVU for all
11 codes in the family. We are proposing the RUC-recommended work RVUs
of 0.92 for CPT code 92X0X, 0.44 for CPT code 92X1X, 0.90 for CPT code
92X2X, 0.44 for CPT code 92X3X, 1.00 for CPT code 92X4X, 0.48 for CPT
code 92X5X, 1.00 for CPT code 92X6X, 0.50 for CPT code 92X7X, 0.98 for
CPT code 92X8X, 0.48 for CPT code 92X9X, and 0.28 for CPT code 92508).
We are proposing the RUC-recommended direct PE inputs for all the
codes in the family without refinement.
We are proposing to designate these codes as always therapy
services which means they must be furnished under a therapy plan of
care regardless of who provides them and billed with a therapy modifier
(this includes physicians and NPPs when they furnish the service or
therapists furnish the services incident to the physician/NPP). We are
also proposing to designate the new CPT codes that each represent the
initial 30 minutes--92X0X, 92X2X, 92X4X, 92X6X, and 92X8X--as subject
to the multiple procedure payment reduction (MPPR) for therapy
services. The new CPT codes that represent each additional 15 minutes--
92X1X, 92X3X, 92X5X, 92X7X and 92X9X--are not subject to the MPPR as
they are all add-on codes which we excluded in the CY 2011 PFS final
rule along with contractor-priced and bundled codes (75 FR 73240) and
noted in section 10.7 of chapter 5 of the Medicare Claims Processing
Manual (MCPM).
(a) Pediatric G-Code for Speech-Language Pathology Services
We have heard from interested parties the need to preserve CPT code
92507 (Treatment of speech, language, voice, communication, and/or
auditory processing disorder; individual) specifically related to the
pediatric population. Interested parties stated that the 10 new CPT
codes do not accurately capture the time and intensity of work as it
relates to pediatric patients. In an effort to be responsive to
interested parties, we are proposing to create and pay separately for a
new HCPCS code, HCPCS code GSLPP, to accurately reflect the time and
resources spent in providing these services to pediatric patients.
We propose the following code and descriptor for the proposed code:
HCPCS code GSLPP (Treatment of speech, language, voice, communication,
and/or auditory processing disorder; individual; for the pediatric
population up to age 21). We are proposing that HCPCS code GSLPP would
be reported by a speech language pathologist performing these services
specific to the pediatric population.
We are proposing that this code could be billed only once per
patient per day. We are proposing to assign a XXX global period payment
indicator for HCPCS code GSLPP. The XXX global period payment indicator
would indicate that the global period does not apply to this service.
As previously discussed in this section, we are proposing to
designate HCPCS code GSLPP as an always therapy service and add it to
the list of codes that are subject to the MPPR for therapy services.
(b) Proposed Valuation for HCPCS Code GSLPP
We note that the proposed valuation of HCPCS code GSLPP is meant to
reflect the time and resource costs, for speech-language pathology
services inherent to the pediatric population. Therefore, we believe
that CPT code 92507 serves as an appropriate reference for the purposes
of valuing HCPCS code GSLPP. We believe there will be relatively the
same work involved for HCPCS code GSLPP when compared to the work of
CPT code 92507 as it relates to pediatric patients, considering the
amount of time needed to furnish the elements discussed earlier in this
section. Therefore, we are proposing a work RVU of 1.30, which
represents the assigned work for 60 minutes of CPT code 92507.
Additionally, we are proposing a work time of 60 minutes established
for CPT code 92507, personally performed by the billing practitioner.
We are proposing the same direct PE inputs for HCPCS code GSLPP as
CPT code 92507, as we believe that the relative resource costs for this
service will remain the same. To help inform whether our proposed
valuation reflects the typical service for the pediatric population, we
are seeking comment on the typical time and intensity practitioners
spend furnishing these services.
(41) Endoluminal Coronary Intravascular Ultrasound (IVUS) (CPT Codes
92978 and 92979)
In April 2025, the RAW identified CPT code 92978 (Endoluminal
imaging of coronary vessel or graft using intravascular ultrasound
(IVUS) or optical coherence tomography (OCT) during diagnostic
evaluation and/or therapeutic intervention including imaging
supervision, interpretation and report; initial vessel (List separately
in addition to code for primary procedure)) as a code that has Medicare
utilization of 10,000 or more that has increased by at least 100
percent from 2018 through 2023. CPT codes 92978 and 92979 (Endoluminal
imaging of coronary vessel or graft using intravascular ultrasound
(IVUS) or optical coherence tomography (OCT) during diagnostic
evaluation and/or therapeutic intervention including imaging
supervision, interpretation and report; each additional vessel (List
separately in addition to code for primary procedure)) were surveyed
for the January 2026 RUC meeting.
We disagree with the RUC-recommended work RVUs for these codes and
instead we are proposing work RVUs of 1.40 for CPT code 92978 and 1.04
for CPT code 92979 to account for the significant decreases in
physician intraservice time for both codes. The RUC's recommendation to
maintain current work RVUs for these codes does not appear to fully
account for these intraservice time decreases. While we do not believe
that the decrease in time as reflected in survey values should always
equate to a one-to-
[[Page 43887]]
one or linear decrease in newly valued work RVUs we do believe that,
since the two components of work are time and intensity, absent an
obvious or explicitly stated rationale for why the relative intensity
of a given procedure has increased, significant decreases in time
should be reflected in decreases to work RVUs although not necessarily
in a linear manner, and we do not believe it is appropriate to decrease
physician time while maintaining the current work RVUs.
We reviewed the RUC recommendations and found them to be high,
relative to other codes with the same or similar work times. Based on a
search of similarly timed codes in the RUC database, the RUC-
recommended work RVU of 1.76 for CPT code 92978 is higher than 44 of 47
add-on codes with 15 minutes of physician intraservice time. Similarly,
the RUC-recommended work RVU of 1.40 for CPT code 92979 would be the
second highest work RVU for add-on codes with 12 to 14 minutes of
physician intraservice time. Therefore, we disagree with the RUC
recommended work RVU of 1.76 for CPT code 92978 and we are instead
proposing a work RVU of 1.40 based on a crosswalk to CPT code 93572
(Intravascular Doppler velocity and/or pressure derived coronary flow
reserve measurement (coronary vessel or graft) during coronary
angiography including pharmacologically induced stress, when performed;
each additional vessel (List separately in addition to code for primary
procedure)). This proposed work RVU is higher than the reverse building
block work RVU of 1.06 and results in a higher intensity for the code
than its current work RVU and physician time. The resulting increase in
intensity more accurately accounts for the RUC's assertion that the
intensity and complexity has increased with the evolution of these
services because a higher proportion of the skin-to-skin time is now
dedicated to more intense activities and interventions.
We also disagree with the RUC recommendation to maintain the
current work RVU of 1.40 for CPT code 92979 and are proposing a work
RVU of 1.04 based on the RUC-recommended increment of 0.36 work RVUs
between CPT codes 96978 and 96979. Similarly, this represents an
increase in intensity compared to the code's current work RVU and work
time to account for the increased intensity that has occurred with the
evolution of these services. The RUC did not recommend and we are not
proposing any direct PE inputs for CPT codes 92978 and 92979.
(42) Autonomic Function Testing (CPT Codes 95921, 95XX4, 95922, 95923,
95XX5, 95XX6, 95924, 95XX7, 95XX8, and 95XX9)
In February 2025, the CPT Editorial Panel created six new codes to
report autonomic function testing with the use of a tilt table,
sudomotor tests, and combined procedures to address an earlier RUC
referral: CPT code 95XX4 (Testing of autonomic nervous system function,
with interpretation and report; use of tilt table), CPT code 95XX5
(Testing of autonomic nervous system function, with interpretation and
report; sudomotor, thermoregulatory sweat test), CPT code 95XX6
(Testing of autonomic nervous system function, with interpretation and
report; sudomotor, assessing the sympathetic skin response (SSR)
potential), CPT code 95XX7 (Testing of autonomic nervous system
function, with interpretation and report; combined parasympathetic and
sudomotor testing, quantitative sudomotor axon reflex test (QSART) or
silastic sweat imprint), CPT code 95XX8 (Testing of autonomic nervous
system function, with interpretation and report; combined sympathetic
adrenergic with at least 5 minutes of passive tilt (ie, tilt table) and
sudomotor testing, quantitative sudomotor axon reflex test (QSART) or
silastic sweat imprint), and CPT code 95XX9 (Testing of autonomic
nervous system function, with interpretation and report; combined
parasympathetic, sympathetic adrenergic function with at least 5
minutes of passive tilt (ie, tilt table), and sudomotor testing,
quantitative sudomotor axon reflex test (QSART) or silastic sweat
imprint). The CPT Editorial Panel also revised four existing codes to
include interpretation and report and clarification on tilt table use:
CPT code 95921 (Testing of autonomic nervous system function, with
interpretation and report; cardiovagal innervation (parasympathetic
function), including 2 or more of the following: heart rate response to
deep breathing with recorded R-R interval, Valsalva ratio, and 30:15
ratio), CPT code 95922 (Testing of autonomic nervous system function,
with interpretation and report; vasomotor adrenergic innervation
(sympathetic adrenergic function), including beat-to-beat blood
pressure and R-R interval changes during Valsalva maneuver and at least
5 minutes of passive tilt (ie, tilt table)), CPT code 95923 (Testing of
autonomic nervous system function, with interpretation and report;
sudomotor, quantitative sudomotor axon reflex test (QSART) or silastic
sweat imprint), and CPT code 95924 (Testing of autonomic nervous system
function, with interpretation and report; combined parasympathetic and
sympathetic adrenergic function testing with at least 5 minutes of
passive tilt (ie, tilt table)). This code family was surveyed for the
April 2025 RUC meeting.
We are proposing the RUC-recommended work RVU for seven of the ten
codes in this family. We are proposing a work RVU of 0.34 for CPT code
95XX4, a work RVU of 0.96 for CPT code 95922, a work RVU of 0.88 for
CPT code 95923, a work RVU of 1.00 for CPT code 95XX5, a work RVU of
0.50 for CPT code 95XX6, a work RVU of 1.50 for CPT code 95924, and a
work RVU of 1.17 for CPT code 95XX7. We note that several of these work
RVUs were affected by the efficiency adjustment which was applied at
the start of CY 2026, as the RUC recommendations were based on pre-
adjustment work valuations.
We disagree with the RUC-recommended work RVU of 0.88 for CPT code
95921 and we are instead proposing a work RVU of 0.74 based on a
crosswalk to CPT code 97813 (Acupuncture, 1 or more needles; with
electrical stimulation, initial 15 minutes of personal one-on-one
contact with the patient). When reviewing this code family, we noticed
that CPT code 95921 had one of the highest intensities in the family at
the RUC-recommended work RVU of 0.88 despite having some of the
shortest surveyed work times and describing one of the seemingly least
intensive procedures. The revised code descriptor for CPT code 95921
describes a single test for cardiovagal innervation, and we do not
agree that this service should be valued with a higher intensity than
some of the other codes in this family that contain multiple kinds of
autonomic function testing. The RUC's recommended work RVU would also
value CPT code 95921 at the same 0.88 as CPT code 95923 despite the
latter code having significantly more total work time (32 minutes as
compared to 25 minutes). We are aware that these codes share the same
current work RVU, however the new surveyed work times indicate that CPT
code 95921 typically takes less time to perform than CPT code 95923,
and, since the two components of work are time and intensity, we
believe that CPT code 95921 should be valued at a lower rate. Therefore
we are proposing a work RVU of 0.74 based on a crosswalk to CPT code
97813, an acupuncture procedure with the identical intraservice and
total work time as CPT code 95921. We also note that this valuation of
CPT code 95921 maintains the current intensity of
[[Page 43888]]
the procedure, as well as better maintaining relativity with the other
codes in the family.
We disagree with the RUC-recommended work RVU of 1.75 for CPT code
95XX8 and we are instead proposing a work RVU of 1.56 based on a
crosswalk to CPT code 77047 (Magnetic resonance imaging, breast,
without contrast material; bilateral). We disagree with the RUC's
recommended work RVU of 1.75, based on the survey median result, as it
represents a significant increase in work valuation and intensity over
the other codes in this family. For example, the RUC recommended a work
RVU of 1.50 for CPT code 95924 in comparison to 1.75 for this code,
despite CPT code 95XX8 having only 5 minutes of additional intraservice
time and 3 minutes of additional total time (50 minutes as compared
with 47 minutes). CPT code 95XX8 would require an anomalously high
intensity relative to the rest of the family to justify the recommended
work valuation of 1.75, which we do not agree would be warranted here
given that this code is performing the same autonomic function tests
that take place in CPT code 95922 and 95923. Therefore we are proposing
a work RVU of 1.56 based on a crosswalk to CPT code 77047, a breast MRI
procedure with the identical intraservice time and similar total work
time as CPT code 95XX8. We believe that this valuation of CPT code
95XX8 better maintains relativity with the other codes in the family
instead of requiring an anomalously high intensity as was the case at
the RUC's recommended work RVU.
We disagree with the RUC-recommended work RVU of 1.91 for CPT code
95XX9 and we are instead proposing a work RVU of 1.77 based on a
crosswalk to CPT code 78831 (Radiopharmaceutical localization of tumor,
inflammatory process or distribution of radiopharmaceutical agent(s)
(includes vascular flow and blood pool imaging, when performed);
tomographic (SPECT), minimum 2 areas (e.g., pelvis and knees, chest and
abdomen) or separate acquisitions (e.g., lung ventilation and
perfusion), single day imaging, or single area or acquisition over 2 or
more days). As was the case with CPT code 95XX8, we believe that the
RUC's recommended work RVU of 1.91 for CPT code 95XX9, based on the
survey 25th percentile result, represents a significant increase in
work valuation and intensity over the other codes in this family. While
we do agree with the RUC that CPT code 95XX9 includes the most
autonomic function tests and should have the highest intensity within
the code family, we disagree that CPT code 95XX9 should be valued at a
work RVU that results in an intensity approximately 50 percent higher
than the rest of this family. To use the same example again, the RUC
recommended a work RVU of 1.50 for CPT code 95924 in comparison to 1.91
for this code, despite CPT code 95XX9 having only 5 minutes of
additional intraservice time and 7 minutes of additional total time (52
minutes as compared with 47 minutes). We believe that the work
valuation and intensity are simply too high at the RUC's recommended
work RVU of 1.91 as this does not maintain relativity with the other
codes in this family, given that the same tests are being performed.
Therefore, we are proposing a work RVU of 1.77 based on a crosswalk to
CPT code 78831, a radiopharmaceutical procedure with the identical
intraservice time and similar total work time as CPT code 95XX9. We
note that this work valuation still assigns the highest intensity in
the family to CPT code 95XX9, while bringing it more in accordance with
its peer codes. We believe that this valuation of CPT code 95XX9 better
maintains relativity with the other codes in the family instead of
requiring an anomalously high intensity as was the case at the RUC's
recommended work RVU.
We are proposing the RUC-recommended direct PE inputs for CPT codes
95921, 95XX4, 95922, 95923, 95XX5, 95XX6, 95924, 95XX7, 95XX8, and
95XX9 without refinement.
(43) Unattended Sleep Testing (CPT Codes 95X18, 95X19, 95X20, 95X21,
95X22, and 95X23)
At the February 2025 CPT Editorial Panel meeting, CPT codes 95800
(Sleep study, unattended, simultaneous recording; heart rate, oxygen
saturation, respiratory analysis (e.g., by airflow or peripheral
arterial tone), and sleep time), 95801 (Sleep study, unattended,
simultaneous recording; minimum of heart rate, oxygen saturation, and
respiratory analysis (e.g., by airflow or peripheral arterial tone))
and 95806 (Sleep study, unattended, simultaneous recording of, heart
rate, oxygen saturation, respiratory airflow, and respiratory effort
(e.g., thoracoabdominal movement)) were deleted. They were replaced
with six new CPT codes: 95X18 (Unattended sleep study, set-up, data
acquisition and technical analysis; low complexity of 3-4 channels that
generate at least 3-5 parameter categories), 95X19 (Unattended sleep
study, set-up, data acquisition and technical analysis; moderate
complexity of 5-10 channels that generate at least 6-8 parameter
categories), 95X20 (Unattended sleep study, set-up, data acquisition
and technical analysis; high complexity of 11 or more channels that
generate at least 9 parameter categories), 95X21 (Unattended sleep
study, interpretation and report by a physician or other qualified
health care professional; low complexity of 3-4 channels that generate
at least 3-5 parameter categories), 95X22 (Unattended sleep study,
interpretation and report by a physician or other qualified health care
professional; moderate complexity of 5-10 channels that generate at
least 6-8 parameter categories), and 95X23 (Unattended sleep study,
interpretation and report by a physician or other qualified health care
professional; high complexity of 11 or more channels that generate at
least 9 parameter categories). This code family describes the reporting
of unattended sleep studies with set-up, data acquisition, and
technical analysis, and with interpretation and report by a physician
or other qualified health care professional. These new codes were
surveyed for the April 2025 RUC meeting.
For CY 2027, the RUC recommended a work RVU of 0.81 for CPT code
95X21, a work RVU of 1.05 for CPT code 95X22, and a work RVU of 1.60
for CPT code 95X23. These codes are professional component only
services and have no direct PE inputs; we also note that the RUC
recommendations for CPT codes 95X21 and 95X22 were affected by the
efficiency adjustment which was applied at the start of CY 2026, as the
RUC recommendations were based on pre-adjustment work valuations. For
CPT code 95X21, we are proposing the RUC's recommended work RVU of 0.81
and for CPT code 95X22, we are proposing the RUC's recommended work RVU
of 1.05.
However, we disagree with the RUC's recommended work RVU of 1.60
for CPT code 95X23 and we are instead proposing a work RVU of 1.42
based on a crosswalk to CPT code 92014 (Ophthalmological services:
medical examination and evaluation, with initiation or continuation of
diagnostic and treatment program; comprehensive, established patient, 1
or more visits), which has 24 minutes of intraservice time and 37
minutes of total time. CPT code 95X23 is a similarly timed code with 20
minutes of intraservice time and 39 minutes of total time. We are aware
that the RUC's recommended work RVU is lower than the survey 25th
percentile work RVU and further understand that the increase in
intensity from moderate complexity of 5 to 10 channels that generate at
least 6 to 8 parameter
[[Page 43889]]
categories to complexity of 11 or more channels that generate at least
9 parameter categories may not be linear. The additional parameters
could be more complex, which could result in higher intensity and may
not be fully captured in the previous two codes. We agree that the
intensity for CPT code 95X23 should be higher; however, we do not
believe that the intensity associated with the RUC recommended RVU of
1.60 is typical for this service since it would be nearly double the
intensity of CPT codes 95X21 and 95X22. Therefore, we believe that CPT
code 92014 is an appropriate crosswalk compared to the RUC's
recommended crosswalk to CPT code 99203 (Office or other outpatient
visit for the evaluation and management of a new patient, which
requires a medically appropriate history and/or examination and low
level of medical decision making. When using total time on the date of
the encounter for code selection, 30 minutes must be met or exceeded.).
We believe that our proposed valuation of 1.42, based on the crosswalk
from 92014, more accurately values CPT code 95X23 since it does not
result in the sizable increase in intensity as recommended by the RUC.
In addition, we have maintained relativity between the codes in this
family with similarly timed codes.
For CPT codes 95X18, 95X19, and 95X20, which are Practice Expense
(PE) only codes, we are proposing the RUC-recommended direct PE inputs.
However, we note concerns regarding two direct PE inputs: CA021
(Perform procedure/service--NOT directly related to physician work
time) and CA042 (Perform procedure/service in post-service period--NOT
directly related to physician work time). For CPT codes 95X18 and
95X19, the RUC recommended 15 minutes for the CA021 activity, and 25
minutes for CPT code 95X20. The rationale for this increase from 15
minutes for CPT codes 95X18 and 95X19 to 25 minutes for CPT code 95X20
was not clearly stated in the PE Summary of Recommendations although
this is an increase of 66.7 percent. Similarly, for the CA042 activity,
the RUC recommended 40 minutes for CPT code 95X18, 50 minutes for CPT
code 95X19, and 70 minutes for CPT code 95X20. We note that there is a
10-minute increase from CPT code 95X18 to CPT code 95X19, and a 20-
minute increase from CPT code 95X19 to CPT code 95X20. The rationale
for these 10-minute and 20-minute increases was also not clearly
stated. We appreciate that explanations for the direct PE inputs were
provided in the PE Summary of Recommendations, given that this is a
non-standard clinical labor activity. However, as CPT code 95X18
describes a low-complexity study, CPT code 95X19 describes a moderate-
complexity study, and CPT code 95X20 describes a high-complexity study,
we welcome public comments providing additional information,
particularly regarding the increases in time for these direct PE inputs
across these three CPT codes.
Also, for CPT codes 95X18, 95X19, and 95X20, the RUC recommended
use of the ``other'' formula for three new equipment items and based
the time assumption of 960 minutes (that is, 16 hours). We are
soliciting comments on whether it would be typical for the equipment in
question to be worn for the full 16 hours. According to the PE Summary
of Recommendations, patients typically arrive later in the day (for
example, around 4 p.m.) for an appointment to perform a test run with
the equipment, then take the equipment home and return it the following
morning (typically around 9 a.m.). Therefore, the RUC recommended a 16-
hour period, representing two nights, as this duration currently exists
in the RUC database and is generally consistent with clinical practice.
However, we are seeking public comments on whether two nights of use
are required and typical for home sleep testing, as the reported
equipment time may represent the total period the patient has the
device outside the office rather than the time it is actually in use.
Lastly, we received invoices for a new supply item and three new
equipment items for CPT codes 95X18, 95X19, and 95X20. The new supply
item is SA143 (Nox A1 Sensor Kit adult), and the new equipment items
are EQ417 (Nox A1s System with SpO2, US), EQ418 (Apnea Link Air), and
EQ419 (Apnea Trak Legacy). However, a single invoice for each supply or
piece of equipment may not be reflective of typical costs, we encourage
interested parties to submit invoices to improve the accuracy of
pricing for these items in the direct PE database.
We are proposing the RUC-recommended direct PE inputs for CPT codes
95X18, 95X19, and 95X20 without refinement.
(44) Laser Treatment for Inflammatory Skin Diseases (CPT Codes 96920,
96921, and 96922)
In May 2025, the CPT Editorial Panel revised three codes to reflect
the intended use for inflammatory or auto-immune skin diseases (e.g.,
psoriasis): CPT codes 96920 (Laser treatment, 308-312 nanometer
wavelengths, for inflammatory or auto-immune skin diseases (e.g.,
psoriasis); total area less than 250 sq cm), 96921 (Laser treatment,
308-312 nanometer wavelengths, for inflammatory or auto-immune skin
diseases (e.g., psoriasis); 250 sq cm to 500 sq cm), and 96922 (Laser
treatment, 308-312 nanometer wavelengths, for inflammatory or auto-
immune skin diseases (e.g., psoriasis); over 500 sq cm). These codes
were last discussed in the CY 2025 PFS final rule (89 FR 97797 through
97801). These revisions were based on flaws in the prior valuation
process and a change in the patient population. The specialty society
surveyed the code family for the September 2025 RUC meeting.
For CY 2027, we are proposing the RUC-recommended work RVUs of 1.00
for CPT code 96920, 1.24 for CPT code 96921, and 1.50 for CPT code
96922. We are proposing the RUC-recommended direct PE inputs for CPT
codes 96920, 96921, and 96922 without refinement.
(45) Real-Time Fluorescence Wound Imaging (CPT Code 976XX)
In September 2025, the CPT Editorial Panel created a new code to
report real-time florescence wound imaging, CPT code 976XX (Real-time
fluorescence wound imaging with clinical darkness to identify presence,
location, load of bacteria and measure wound size, per day). The
specialty society did not conduct a survey for CPT code 976XX because
they determined it would be unable to conduct a successful survey that
met the RUC's minimum survey threshold, and therefore, the RUC
recommended contractor pricing for CY 2027.
Due to persistent payment variability for the predecessor CPT codes
0598T and 0599T, and limited geographical uptake of the technology, the
device manufacturer requested that CMS actively price CPT code 976XX
and provided work RVU and direct PE input recommendations. After
consideration of the manufacturer's recommendations, we are proposing a
work RVU of 0.80 and physician pre-evaluation time of 6 minutes,
intraservice time of 15 minutes, and immediate post service time of 5
minutes, totaling 26 minutes of physician time. For direct PE in the
non-facility, we are proposing a direct crosswalk of clinical labor
activities and time from CPT code 97610 (Low frequency, non-contact,
non-thermal ultrasound, including topical application(s), when
performed, wound assessment, and instruction(s) for ongoing care, per
day), with the addition of 10 minutes for CA026 Clean surgical
instrument package for CPT code 976XX, for a total of 42 minutes of
[[Page 43890]]
clinical labor time. Additionally, we are proposing the following
supply items and quantities in the non-facility for CPT code 976XX.
[GRAPHIC] [TIFF OMITTED] TP16JY26.022
Additionally, we are proposing the following equipment items and
equipment minutes in the non-facility to correspond with the 30 and 36
minutes of clinical labor time included in the default and instrument
pack equipment formulas, respectively, for CPT code 976XX. The
MolecuLight DX System (ER131) was added to the direct PE database for
inclusion in CPT code 976XX assuming a 5-year useful life and purchase
price of $21,500 based on the provided invoices. We are not proposing
to include the MolecuLight carrying case in CPT code's 976XX's
equipment costs as recommended by the device manufacturer. We have a
longstanding policy that medical equipment must be at least $500 and
all equipment inputs under $500 are considered indirect expense. We
welcome public comment on the appropriateness of our proposed work RVU
and the typicality of our proposed physician work times and direct PE
inputs.
[GRAPHIC] [TIFF OMITTED] TP16JY26.023
We are seeking comment on whether this service will typically be
billed alongside wound debridement codes (that is, greater than 50
percent of the time), and if so, which of the proposed direct PE inputs
may be duplicative of those already included in the wound debridement
codes, such as CPT codes 11042 (Debridement, subcutaneous tissue
(includes epidermis and dermis, if performed); first 20 sq cm or less)
and 97597 (Debridement (e.g., high pressure waterjet with/without
suction, sharp selective debridement with scissors, scalpel and
forceps), open wound, (e.g., fibrin, devitalized epidermis and/or
dermis, exudate, debris, biofilm), including topical application(s),
wound assessment, use of a whirlpool, when performed and instruction(s)
for ongoing care, per session, total wound(s) surface area; first 20 sq
cm or less)). We note that CPT code 976XX's predecessor codes, CPT
codes 0598T and 0599T, were billed with wound debridement codes 35.1
percent and 46.6 percent of the time, respectively. However, we
understand that such concurrent billing with wound debridement may
become more common as adoption of this technology increases. For
example, we are seeking comment on whether the following proposed
supply items are duplicative of debridement codes if it is anticipated
that these codes will be typically billed together: SB007, SB019,
SB044, SC056, SF007, SF018, SG035, SG051, SG052, SG079, SH069 and
SJ046. We are also seeking comment on whether these wound care supply
items are typical for CPT code 976XX, given that the code descriptor
specifies wound imaging but does not include any wound care elements.
Finally, we note that the direct PE crosswalk code, CPT code 97610, is
billed alone 64.4 percent of the time and with debridement CPT code
11042 only 4.3 percent of the time. Therefore, we are seeking comment
on the appropriateness of this code as a direct PE crosswalk
considering the different billing patterns of CPT code 97610 and 976XX
based on its predecessor codes.
(46) Lactation Care Services (CPT Codes 978XX and 978X1)
At the May 2025 CPT Editorial Panel meeting, two new CPT codes were
created for reporting lactation care directed by a physician or
qualified health care professional (QHP): CPT codes 978XX (Lactation
care directed by a physician or other qualified health care
professional, including history, assessment, training, and report;
first 30
[[Page 43891]]
minutes) and 978X1 (Lactation care directed by a physician or other
qualified health care professional, including history, assessment,
training, and report; each additional 15 minutes). These new CPT codes
were surveyed at the September 2025 AMA RUC Meeting.
For CY 2027, we are proposing the RUC-recommended work RVU of 0.18
for CPT code 978XX. The RUC did not recommend, and we are not proposing
a work RVU for CPT code 978X1, which has been designed as a PE only
service.
We are proposing the RUC-recommended direct PE inputs for CPT codes
978XX and 978X1, including the creation of a new clinical staff type
for Lactation Consultant (L076A) and a new EF052 equipment item (scale,
infant, digital, fine gradation). We are adopting CPT language and
requirements for the Lactation Consultant: ``The qualifications of the
lactation consultant/counselor must be recognized by a physician
society, nonphysician health care professional society/association, or
other appropriate source.'' We are proposing to value this new clinical
staff type at the same 0.76 rate per minute currently used by the RN
(L051A) clinical staff type as recommended by the RUC; we are seeking
comment regarding this new clinical staff type and whether there may be
a more appropriate crosswalk than the RN clinical staff type. We are
proposing the RUC-recommendation of the RN clinical staff type as a
proxy for pricing purposes, but are seeking comment on whether
Lactation Consultants are typically RNs with additional credentialing/
certification to be qualified to serve as a lactation consultant.
(47) Adaptive Behavior Services (CPT Codes 97151, 97152, 97X1X, 97X2X,
97X3X, 97153, 97154, 97X4X, 97X5X, 97155, 97X6X, 97156, 97157, 97158)
At the September 2025 CPT Editorial Panel meeting, the CPT
Editorial Panel deleted CPT codes 0362T (Behavior identification
supporting assessment, each 15 minutes of technicians' time face-to-
face with a patient, requiring the following components: administration
by the physician or other qualified health care professional who is on
site; with the assistance of two or more technicians; for a patient who
exhibits destructive behavior; completion in an environment that is
customized to the patient's behavior.) and 0373T (Adaptive behavior
treatment with protocol modification, each 15 minutes of technicians'
time face-to-face with a patient, requiring the following components:
administration by the physician or other qualified health care
professional who is on site; with the assistance of two or more
technicians; for a patient who exhibits destructive behavior;
completion in an environment that is customized to the patient's
behavior.), revised eight existing CPT codes: 97151 (Behavior
identification assessment, administered by a physician or other QHP,
each 15 minutes of the physician's or other QHP's time face-to-face
with patient and/or caregiver(s) administering assessments and
discussing findings and recommendations, and non- face-to-face
analyzing past data, scoring and/or interpreting the assessment, and
preparing the report and/or treatment plan), 97152 (Behavior
identification-supporting assessment, administered by technician, face-
to-face with the patient, each 15 minutes), 97153 (Adaptive behavior
treatment by protocol, administered by technician, face-to-face with
one patient, each 15 minutes), 97154 (Group adaptive behavior treatment
by protocol, administered by technician, face-to-face with two or more
patients, each 15 minutes), 97155 (Adaptive behavior direction of
technician and analysis by physician or other QHP, face-to-face with a
patient, each 15 minutes), 97156 (Family adaptive behavior treatment
guidance with analysis, administered by physician or other QHP (with or
without the patient present), including discussing protocols and
treatment targets and/or training the caregiver(s) to implement
assessment or treatment protocols with the patient, face-to-face with
caregiver(s) for 1 patient, each 15 minutes), 97157 (Multiple-family
group adaptive behavior treatment guidance with analysis, administered
by physician or other QHP (without the patient present), face-to-face
with multiple sets of caregivers for multiple patients, each 15
minutes) and 97158 (Group adaptive behavior treatment with analysis,
administered by physician or other QHP, face-to-face with multiple
patients, each 15 minutes), and created six new CPT codes: 97X1X
(Behavior identification supporting assessment of harmful behavior,
each 15 minutes of technician time face-to-face with a patient,
requiring the following components: delivered by two technicians, for a
patient who exhibits harmful behavior, conducted in an environment that
is customized to the patient's behavior,), 97X2X (Behavior
identification supporting assessment of harmful behavior, each 15
minutes of technician time face-to-face with a patient, requiring the
following components: delivered by two technicians, for a patient who
exhibits harmful behavior, conducted in an environment that is
customized to the patient's behavior, additional technicians present,
each 15 minutes (list separately in addition to code for primary
procedure)), 97X3X (Adaptive behavior non-face-to-face services,
personally performed by a physician or other QHP, each 15 minutes, with
any of the following elements, when performed: review and analysis of
data and session notes on patient treatment targets, clinical decision
making regarding the need to modify treatment targets, goals, or
protocols and/or making those modifications, clinical decision making
regarding the need for additional assessment and developing or
modifying assessment protocols, developing discharge or transition
plan, reviewing treatment targets and/or revised assessment or
treatment protocols with technician(s).), 97X4X (Adaptive behavior
treatment of harmful behavior, each 15 minutes of technician time with
a patient, requiring the following components: delivered by two
technicians, for a patient who exhibits harmful behavior, conducted in
an environment that is customized to the patient's behavior.), 97X5X
(Adaptive behavior treatment of harmful behavior, each 15 minutes of
technician time with a patient, requiring the following components:
delivered by two technicians, for a patient who exhibits harmful
behavior, conducted in an environment that is customized to the
patient's behavior, each additional technician present, each 15 minutes
(List separately in addition to code for primary procedure)), and 97X6X
(Adaptive behavior treatment with analysis, administered by physician
or other qualified health care professional, face-to-face with 1
patient, each 15 minutes), to better specify appropriate time, define
terms, address reporting gaps, and clarify reporting for technician and
physician/QHP face-to-face and non-face-to-face adaptive behavior
services. The RUC HCPAC Review Board reviewed the 14 codes in the
revised code family at the January 2026 RUC HCPAC.
The RUC is recommending contractor pricing for all twelve codes in
the family. The existing CPT codes 97151 through 97158 are currently
contractor priced. We propose to contractor price the six new codes and
make no change to the status indicator for the eight revised existing
codes that are already contractor priced.
[[Page 43892]]
(48) Remote Monitoring (CPT Codes 98975, 98976, 98977, 98978, 98980,
98981, 98984, 98985, 98986, 98979, 99091, 99453, 99454, 99457, 99458,
99473, 99474, 99445, and 99470)
(a) Background and Overview
In recent years, we have established payment for two code families
that describe certain remote monitoring services: remote physiologic
monitoring (RPM) and remote therapy monitoring (RTM). In the CY 2018
PFS final rule, we summarized feedback from a comment solicitation
aimed at informing new payment policies that would allow for separate
payment for remote monitoring services (82 FR 53014). In the CY 2019
PFS final rule (83 FR 59574 through 59576), we established valuations
and payment policy for the RPM code family. In the CY 2020 PFS final
rule (84 FR 62697 through 62698), we explained that the RPM code family
describes chronic care RPM services that involve the collection,
analysis, and interpretation of digitally collected physiologic data,
followed by the development of a treatment plan and the managing of a
patient under the treatment plan (84 FR 62697). In the CY 2020 PFS
final rule, we finalized that CPT codes 99457 and 99458 would be
included as designated care management services, allowing RPM services
to be furnished under the general supervision of the physician or other
qualified health care professional (who is qualified by education,
training, licensure/regulation and facility privileging) (84 FR 62698).
In the CY 2023 PFS final rule, in response to comments, we clarified
that RTM or RPM services could be billed concurrently with Chronic Care
Management (CCM), Transitional Care Management (TCM), Principal Care
Management (PCM), Chronic Pain Management (CPM), or Behavioral Health
Integration (BHI) (86 FR 69528 through 69539).
In September 2024, the Current Procedural Terminology (CPT)
Editorial Panel added one code and made code revisions to report RPM
device supply for 2 to 15 days and 16 to 30 days within a 30-day
period; created one new code and code revisions to report RPM treatment
management services for the first 10 minutes, first 20 minutes, and
each additional 20 minutes thereafter; added three RTM device supply
codes to report respiratory, musculoskeletal and cognitive behavioral
therapy for 2 to 15 days and 16 to 30 days within a 30-day period;
created one new code and made code revisions to report RTM treatment
management services for the first 10 minutes, first 20 minutes, and
each additional 20 minutes thereafter; and revised remote monitoring
guidelines. We reviewed the RUC recommendations for these services in
the CY 2026 PFS final rule (90 FR 49394 through 49404). In response to
recent reports and recommendations from the Office of the Inspector
General (Additional Oversight of Remote Patient Monitoring in Medicare
Is Needed \2\ and Billing for Remote Patient Monitoring in Medicare
\3\), for CY 2027, we are proposing refinements to the policies
surrounding remote physiologic and remote therapeutic monitoring, as
detailed later in this section.
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\2\ https://oig.hhs.gov/reports/all/2024/additional-oversight-of-remote-patient-monitoring-in-medicare-is-needed/.
\3\ https://oig.hhs.gov/reports/all/2025/billing-for-remote-patient-monitoring/.
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(b) Established Patient Requirements
In the CY 2021 PFS final rule (85 FR 84542 through 84546), we
established that, when the PHE for COVID-19 ended, we again required
that RPM services be furnished only to an established patient. Patients
who received initial remote monitoring services during PHE were
considered established patients for purposes of the new patient
requirements that were effective after the last day of the PHE for
COVID-19.
For CY 2027, we are proposing to require that RTM services also be
furnished only to established patients. We are proposing this condition
of payment because we believe that a practitioner with an established
relationship with a patient would likely have had the opportunity to
collect relevant patient history and conduct a physical exam, as
appropriate. As a result, the practitioner would possess information
needed to understand the current medical status and needs of the
patient prior to ordering RTM services to collect and analyze the
patient's data and use the results of remote therapeutic monitoring to
manage the patient under a specific treatment plan or therapy plan of
care.
This proposal would also assist in resolving OIG's findings that
some practices did not have a prior relationship with patients for whom
they billed remote monitoring services for (Billing for Remote Patient
Monitoring in Medicare \4\).
---------------------------------------------------------------------------
\4\ See the eCQI Resource Center description of the US Quality
Core Implementation Guide (https://ecqi.healthit.gov/qi-core/about)
and version 0.5.0 of the 2026 US Quality Core Implementation Guide
(http://fhir.org/guides/onc/us-quality-core/ImplementationGuide/fhir.onc.us-quality-core).
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(c) Initiating Visit Requirements
For CY 2027, we are proposing that practitioners reporting RPM or
RTM services must furnish a separately reportable initiating visit in
association with the onset of RPM or RTM services, since these services
require a level of care coordination that cannot be effective without
appropriate evaluation of the patient's needs. The initiating visit
would also ensure the billing practitioner assesses the beneficiary to
determine clinical appropriateness of RPM or RTM and provide an
opportunity to obtain the required beneficiary consent to receive RPM
or RTM services. We are proposing that RPM or RTM services must be
initiated by the billing practitioner during a face-to-face (in-person
or telehealth) visit. CPT codes that do not involve a face-to-face
visit by the billing practitioner or are not separately payable under
Medicare cannot be used as the visit for RPM or RTM initiation. If RPM
or RTM is not discussed with the patient at that visit, that visit
cannot count as the initiating visit for RPM or RTM. The RPM or RTM
initiating visit can be separately billed.
(d) Supervision Requirements
Currently, RPM or RTM services may be outsourced to third-party
companies that provide services via telephone and online contact only,
using staff who have little to no established relationship with the
beneficiary or other members of the care team and have little to no
interaction with the office staff and billing practitioner. After
reviewing the findings discussed in recent OIG reports, such as
companies ``cold calling'' beneficiaries to solicit them for remote
monitoring services they may not need (Additional Oversight of Remote
Patient Monitoring in Medicare Is Needed \5\) and working to improve
the transparency of ``incident to'' services, we believe outsourcing
RPM/RTM services to a third party can fragment care, lead to
insufficient involvement and oversight of the billing practitioner, or
result in services that do not actually represent or facilitate all
required aspects of RPM or RTM services. Provision of these services by
entities having only a loose association with the treating practitioner
can detract from longitudinal, patient-centered care. We do not believe
that RPM or RTM services provided by clinical staff contracted by a
third party can ensure the billing practitioner has adequate oversight,
management, or collaboration
[[Page 43893]]
to bill RPM or RTM services. If there is little oversight by the
billing practitioner or a lack of clinical integration between a third-
party providing RPM/RTM and the billing practitioner, we do not believe
that the full scope of service elements required to bill these codes
are being met.
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\5\ https://oig.hhs.gov/reports/all/2024/additional-oversight-of-remote-patient-monitoring-in-medicare-is-needed/.
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We are proposing to only allow payment for RPM or RTM services when
furnished by clinical staff employed by the practice. To count the time
spent by clinical staff providing aspects of RPM or RTM services, the
clinical staff must be a direct employee of the practitioner or the
practitioner's practice. If finalized, this will mean that for the
purposes of billing Medicare, beginning January 1, 2027, the RPM and
RTM codes could not be billed in cases where the service is not
performed by clinical staff of the billing practitioner and will not
allow contracting out to third-party companies. This does not mean the
clinical staff must necessarily always be physically located within the
practice, nor does it require that the beneficiary be on-site for the
provision of remote monitoring services. Under our proposed revised
policy, the time spent by clinical staff providing RPM or RTM services
can be counted, provided that the clinical staff are under the general
supervision of the billing practitioner, all other requirements of the
``incident to'' regulations at Sec. 410.26 are met, and the clinical
staff is a direct employee of the practitioner or the practitioner's
practice. We are seeking comment on this proposal, specifically on how
often third-party billing currently occurs and how this policy, if
finalized, could impact access to remote monitoring services.
(e) Valuation
Remote physiologic monitoring (RPM) represents the remote
monitoring of parameters such as weight, blood pressure, and pulse
oximetry to monitor a patient's condition and inform their management.
The remote physiologic monitoring code set currently includes CPT codes
99091, 99445, 99453, 99454, 99457, 99458, 99470, 99473, and 99474 (code
descriptors in Table A-D6). Remote therapeutic monitoring (RTM)
represents the monitoring of adherence to at-home therapeutic
interventions. For RTM, there are distinct device supply codes for
three types of therapeutic monitoring: respiratory system, cognitive
behavioral therapy, and musculoskeletal system monitoring. The remote
therapeutic monitoring code set currently includes CPT codes 98975,
98976, 98977, 98978, 98979, 98980, 98981, 98984, and 98985 (code
descriptors in Table A-D6). There are three components of RPM and RTM
services: education and setup, device supply, and treatment management.
[GRAPHIC] [TIFF OMITTED] TP16JY26.024
For CPT codes 99453 and 98975, which are PE-only codes describing
RPM and RTM initial set-up and patient education on use of equipment,
respectively, we are proposing to crosswalk the direct PE inputs from
CPT code 99473 (Self-measured blood pressure using a device validated
for clinical accuracy; patient education/training and device
calibration), as we believe the existing valuation of CPT codes 99453
and 98975 may not accurately reflect the resource costs involved in
those services. Specifically, we are concerned that, due to lack of
information regarding the typical device used to perform these
procedures, these services are overvalued. We believe that
[[Page 43894]]
the typical device used for these procedures in the physician office
setting may not be accurately captured in the data previously used for
valuation, as we have received very little invoice or pricing
information from interested parties for the specific devices used in
RTM and RPM services. We believe that a crosswalk to the direct PE
inputs associated with CPT code 99473 may more accurately capture the
resource costs associated with a typical device set-up and patient
education on use of equipment. We are seeking comment on this proposal,
specifically information regarding the typical clinical workflow for
the initial set-up and patient education on use of equipment services
used in furnishing RPM or RTM and their associated costs.
For CPT codes 99445 and 99454, which are PE-only codes describing
RPM device(s) supply with daily recording(s) or programmed alert(s)
transmission, we are proposing to crosswalk the direct PE inputs from
CPT code 99474 (Self-measured blood pressure using a device validated
for clinical accuracy; separate self-measurements of two readings one
minute apart, twice daily over a 30-day period (minimum of 12
readings), collection of data reported by the patient and/or caregiver
to the physician or other qualified health care professional, with
report of average systolic and diastolic pressures and subsequent
communication of a treatment plan to the patient). For CPT codes 98976,
98977, 98978, 98984, 98985, and 98986, which are PE-only codes
describing RTM device(s) supply for data access or data transmissions,
we are proposing to crosswalk the direct PE inputs from CPT code 93270
(External patient and, when performed, auto activated
electrocardiographic rhythm derived event recording with symptom-
related memory loop with remote download capability up to 30 days, 24-
hour attended monitoring; recording (includes connection, recording,
and disconnection)). We believe the existing valuation of CPT codes
99445, 99454, 98976, 98977, 98978, 98984, 98985, and 98986 may not
accurately reflect the resource costs involved in these services,
especially since we continue to lack data surrounding the typical RPM
and RTM devices and the costs associated with them. Specifically, we
are concerned that, due to lack of information regarding the typical
device used to perform these procedures, these services are overvalued.
We believe that the typical device used for these procedures in the
physician office setting may not be accurately captured in the data
previously used for valuation, as we have received very little invoice
or pricing information from interested parties for the specific devices
used in RTM and RPM services. We believe that the crosswalk to the
direct PE inputs associated with the proposed codes discussed earlier
may more accurately capture the resource costs associated with a
typical device. We are soliciting comments on this proposal,
specifically information regarding the typical devices used in
furnishing RPM or RTM, not just their associated costs and invoices,
but robust evidence detailing what providers are actually paying for
these devices, including discounts or other typical pricing details. We
are seeking other types of pricing data and information for RPM or RTM
devices, including if the costs include software, hardware, or both, as
well as more information about the typical devices.
For CPT codes 99470, 99457, 99458, 98979, 98980, and 98981, which
describe the physician/QHP work associated with treatment management,
we are proposing to eliminate PE inputs for these codes, as we believe
resource costs for these services are accurately captured in the work
RVUs, and we do not believe the typical clinical workflow for these
services would involve clinical staff time. We are proposing that the
current work RVUs and current work times for these codes be maintained.
We welcome information regarding the typical clinical workflow for
these services.
We are soliciting comments on these proposals, as well as
requesting general feedback from the public that may be useful in
further development of our payment policies for remote monitoring
services that are currently separately payable under the PFS.
(f) Comment Solicitation
We have concerns about the administrative burden of the numerous
remote monitoring codes and proliferation of this code family. We also
continue to work to implement recommendations from the recent OIG
reports that we are concerned cannot be fully resolved with the current
coding structure of the remote monitoring code family, such as ensuring
that beneficiaries receive all components of the remote monitoring
service. For example, the OIG report found that, ``About 43 percent of
enrollees who received remote patient monitoring did not receive all 3
components of it, raising questions about whether the monitoring is
being used as intended.'' (Additional Oversight of Remote Patient
Monitoring in Medicare Is Needed \6\).
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\6\ https://oig.hhs.gov/reports/all/2024/additional-oversight-of-remote-patient-monitoring-in-medicare-is-needed/.
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We are also considering, and are seeking comment on, bundling CPT
codes 99453, 99445, 99454, 99091, 99470, 99457, 99458, 98975, 98984,
98976, 98985, 98977, 98986, 98978, 98979, 98980, and 98981 through the
creation of new codes that describe initial set up and monthly
monitoring/management for RPM and RTM, respectively. For payment for
remote monitoring services under the PFS, we are also considering, and
are seeking comment on, the creation of four new HCPCS G-Codes:
GRPM1: RPM initial set-up and patient education.
GRPM2: Remote monitoring of physiologic parameter(s)
(e.g., weight, blood pressure, pulse oximetry, respiratory flow rate),
per calendar month, including:
++ Device(s) supply with daily recording(s) or programmed alert(s)
transmission.
++ 2 or more days of data transmission.
++ Treatment management services, requiring at least one real-time
interactive communication with the patient/caregiver; time totaling at
least 20 minutes.
GRTM1: RTM initial set-up and patient education.
GRTM2: Remote monitoring of therapeutic parameter(s)
(e.g., therapy adherence, therapy response, digital therapeutic
intervention), per calendar month, including:
++ Device(s) supply for data access or data transmissions.
++ 2 or more days of data transmission.
++ Treatment management services, requiring at least one real-time
interactive communication with the patient or caregiver; time totaling
at least 20 minutes.
We are seeking comment on these HCPCS G-codes and are also seeking
comment on any other revisions needed to the code descriptors to
reflect the necessary service elements for this code family. These
HCPCS G-codes would adopt all current conditions of payment for the
remote therapeutic and remote physiologic codes finalized in prior
rulemaking, as well as the proposed established patient, initiating
visit, or supervision or both requirements outlined earlier in this
section, if finalized. As drafted, all service elements outlined in the
G-code descriptors would be required each
[[Page 43895]]
calendar month. We are seeking public comment on these HCPCS G-codes
and, after consideration of public comment, could finalize payment for
these codes.
The creation of these G-codes could alleviate administrative
burden, as this would reduce the number of remote monitoring codes from
17 to four. These HCPCS G-codes would also ensure that beneficiaries
receive treatment management services when receiving remote monitoring
services. According to the OIG Reports, billing for Remote Patient
Monitoring in Medicare \7\ and Additional Oversight of Remote Patient
Monitoring in Medicare Is Needed,\8\ some beneficiaries do not
regularly receive treatment management services. The OIG Report,
Additional Oversight of Remote Patient Monitoring in Medicare Is
Needed,\9\ also stated that forty-three percent of enrollees who
received remote patient monitoring did not receive at least one of the
three components (patient education and set-up, device supply, and
treatment management). Although we have not required that providers
bill for all three components, this data from the OIG Report raises
questions about how these services are being used. By incorporating
device supply, data transmission, and treatment management into one
code, we could ensure that those service elements are always provided.
---------------------------------------------------------------------------
\7\ https://oig.hhs.gov/reports/all/2025/billing-for-remote-patient-monitoring/.
\8\ https://oig.hhs.gov/reports/all/2024/additional-oversight-of-remote-patient-monitoring-in-medicare-is-needed/.
\9\ https://oig.hhs.gov/reports/all/2024/additional-oversight-of-remote-patient-monitoring-in-medicare-is-needed/.
---------------------------------------------------------------------------
In the CY 2024 PFS final rule (88 FR 79071 through 79073), we
finalized the policy to add the suite of services that comprise RPM and
RTM services to the general care management code, G0511 beginning
January 1, 2024 as the requirements for RPM and RTM services are
similar to the non-face-to-face requirements for the general care
management services furnished in RHCs and FQHCs. Beginning January 1,
2025, RHCs and FQHCs are required to bill the individual codes that
make up the general care management HCPCS code, G0511 (89 FR 97998
through 98010). Accordingly, we are seeking comment on implementing
these HCPCS G-codes in RHCs and FQHCs.
We are seeking comment on valuation for these HCPCS G-codes. For
GRPM1 and GRTM1, which could be PE-only codes describing RPM and RTM
initial set-up and patient education on use of equipment, respectively,
we could crosswalk the direct PE inputs from CPT code 99473 (Self-
measured blood pressure using a device validated for clinical accuracy;
patient education/training and device calibration). We are seeking
comment on this valuation, specifically information regarding the
typical clinical workflow for the initial set-up and patient education
on the use of equipment services used in furnishing RPM or RTM and
their associated costs.
For GRPM2, we could crosswalk the work RVU input of 0.61 RVUs from
CPT code 99457 and the direct PE inputs from CPT code 99474 (Self-
measured blood pressure using a device validated for clinical accuracy;
separate self-measurements of two readings one minute apart, twice
daily over a 30-day period (minimum of 12 readings), collection of data
reported by the patient and/or caregiver to the physician or other
qualified health care professional, with report of average systolic and
diastolic pressures and subsequent communication of a treatment plan to
the patient).
For GRTM2, we could crosswalk the work RVU input of 0.62 RVUs from
CPT code 98980 and the direct PE inputs from CPT code 93270 (External
patient and, when performed, auto activated electrocardiographic rhythm
derived event recording with symptom-related memory loop with remote
download capability up to 30 days, 24-hour attended monitoring;
recording (includes connection, recording, and disconnection)).
(49) National Payment for Non-Sheet Form Skin Substitutes
In the CY 2026 PFS final rule (90 FR 49500), we finalized
contractor pricing for non-sheet form skin substitutes. We stated that
these products have the potential to be payable as skin substitutes;
but that the units, as expressed in a product's coding, are difficult
to standardize for payment purposes. Therefore, we finalized that we
would maintain the current coding mechanism for these products and
would direct the Medicare Administrative Contractors (MACs) to
determine appropriate payment, which is generally consistent with how
these products are currently paid. We stated that we would continue to
evaluate payments for these products to determine if an alternative
payment methodology may be better suited to non-sheet products.
Based on ongoing analysis and feedback from internal and external
interested parties, we have come to believe that, on the balance, the
resource costs per cm\2\ for non-sheet form skin substitutes is
consistent with the resource costs associated with those associated
with sheet form skin substitutes. For non-sheet skin substitute
products, cm\2\ reflects the wound surface area treated rather than the
physical dimensions of the product. Therefore, for CY 2027, we are
proposing to nationally price the non-sheet form skin substitutes
consistent with the payment rates associated with the sheet form skin
substitutes. For a list of the non-sheet form skin substitutes, please
refer to the skin substitutes section located on the CMS website
(https://www.cms.gov/medicare/payment/fee-schedules/physician-fee-schedule/skin-substitutes).
(50) Smoking and Tobacco Use Cessation (CPT Codes 99406, 99407) and
Screening, Brief Intervention, and Referral to Treatment (SBIRT) (HCPCS
Codes G2011, G0396, G0397)
The Trump Administration Executive Order, ``Establishing the
President's Make America Health Again Commission'' \10\ is a top
priority for CMS, as such we continue to focus on the prevention and
management of chronic disease. Chronic disease remains a significant
public health concern, with three in four American adults having at
least one chronic condition, and more than half having two or more
chronic conditions. Many preventable chronic diseases are caused by a
short list of risk behaviors, including smoking, poor nutrition,
physical inactivity, and excessive alcohol use.\11\ These patterns
reinforce the need for accessible behavioral health services that can
help individuals reduce these risk behaviors.
---------------------------------------------------------------------------
\10\ https://www.whitehouse.gov/presidential-actions/2025/02/establishing-the-presidents-make-america-healthy-again-commission/.
\11\ https://www.cdc.gov/chronic-disease/about/index.html.
---------------------------------------------------------------------------
In the CY 2024 PFS final rule (88 FR 79006 through 79010), we
finalized an increase in the valuation for timed behavioral health
services under the PFS by applying an upward adjustment of 19.1 percent
to the work RVUs for time-based psychotherapy codes payable under the
PFS. This increase is being implemented over a 4-year transition
period.
We believe similar adjustments are warranted for smoking and
tobacco use cessation, CPT codes 99406 (Smoking and tobacco use
cessation counseling visit; intermediate, greater than 3 minutes up to
10 minutes) and 99407 (Smoking and tobacco use cessation counseling
visit; intensive, greater than 10 minutes) and screening, brief
intervention, and referral to treatment (SBIRT) services, HCPCS codes
G2011
[[Page 43896]]
(Alcohol and/or substance (other than tobacco) misuse structured
assessment (e.g., audit, dast), and brief intervention, 5-14 minutes),
G0396 (Alcohol and/or substance (other than tobacco) misuse structured
assessment (e.g., audit, dast), and brief intervention 15 to 30
minutes), and G0397(Alcohol and/or substance (other than tobacco)
misuse structured assessment (e.g., audit, dast), and intervention,
greater than 30 minutes).
Smoking and tobacco cessation and SBIRT services are evidence
supported behavioral health interventions. Quitting smoking provides
immediate health improvements including lowering the likelihood of
developing lung cancer and other smoking-related cancers, and reduces
the risks of coronary heart disease, stroke, and chronic obstructive
pulmonary disease. Evidence based smoking and tobacco cessation
treatments are effective, including the combination of behavioral
counseling and medication therapy.\12\ SBIRT effectively addresses
substance use. In primary care and other clinical settings, SBIRT has
been shown to help decrease unhealthy substance use and misuse.\13\
---------------------------------------------------------------------------
\12\ https://progressreport.cancer.gov/prevention/tobacco/cessation-aids#jump-links-field-background.
\13\ https://pmc.ncbi.nlm.nih.gov/articles/PMC5551279/.
---------------------------------------------------------------------------
The smoking and tobacco cessation services (CPT codes 99406 and
99407) and SBIRT services HCPCS codes G0396 and G0397 were last valued
in 2008, and the SBIRT service HCPCS code G2011 was created and last
valued in 2019. Given the evidence supported role these services play
in preventing and managing chronic disease and behavioral health
conditions including alcohol and/or substance misuse, we believe that
valuation should more accurately reflect the clinical intensity and
work associated with these time-based services.
Therefore, we propose applying the same upward adjustment of 19.1
percent to the work RVUs for these time-based services aligning with
the adjustments made to the time-based psychotherapy codes, in
conjunction with the fourth and final year of the phase-in for time-
based psychotherapy codes that we finalized in the CY 2024 PFS final
rule (88 FR 79006 through 79010). Although the upward adjustment of
19.1 percent for the time-based psychotherapy codes has been
implemented over a 4-year period, with CY 2027 being the fourth year,
we are proposing to apply the full 19.1 percent to smoking and tobacco
use cessation services and SBIRT services in this final year of the
transition. This approach ensures that these services are brought into
alignment with the psychotherapy codes at the completion of the 4-year
phase-in timeline, rather than initiating a new multiyear phase-in
period. We are proposing to refine the work RVU of smoking and tobacco
use cessation services codes as follows: for CPT code 99406 by
increasing the work RVU to 0.29 from the current 0.24, and CPT code
99407 by increasing the work RVU to 0.60 from the current 0.50; and for
the SBIRT services codes, we are proposing to refine the work RVU as
follows, for HCPCS code G2011 by increasing the work RVU to 0.39 from
the current 0.33, for HCPCS code G0396 by increasing the work RVU to
0.77 from the current 0.65, and for HCPCS code G0397 by increasing the
work RVU to 1.55 from the current 1.30.
(51) Psychiatric Collaborative Care Model (CoCM) (CPT codes 99492,
99493, 99494, G2214) and APCM BHI Add-On Codes (HCPCS Codes G0568,
G0569)
Patients with chronic health conditions are ``more likely to have
related behavioral health concerns and find it easier to improve
chronic conditions when these concerns are also addressed.'' \14\
Integrating behavioral health with primary care has been shown to
improve outcomes like reductions in depression severity and enhancing
patient's experience of care.\15\
---------------------------------------------------------------------------
\14\ https://integrationacademy.ahrq.gov/about/integrated-
behavioral-
health#:~:text=Integrated%20behavioral%20health%20offers%20many,these
%20concerns%20are%20also%20addressed.
\15\ Balasubramanian, Bijal, Deborah Cohen, Katelyn Jetelina,
Miriam Dickinson, Melinda Davis, Rose Gunn, Kris Gowen, Frank DeGruy
3rd, Benjamin Miller, Larry Green. ``Outcomes of Integrated
Behavioral Health with Primary Care.'' J Am Board Fam Med. 2017 Mar-
Apr;30(2):130-139.doi: 10.3122/jabfm.2017.02.160234
---------------------------------------------------------------------------
In the CY 2017 PFS final rule (81 FR 80230), we established
separate payment for three services, HCPCS codes G0502 (Initial
psychiatric collaborative care management, first 70 minutes in the
first calendar month of behavioral health care manager activities, in
consultation with a psychiatric consultant, and directed by the
treating physician or other qualified health care professional, with
the following required elements: outreach to and engagement in
treatment of a patient directed by the treating physician or other
qualified health care professional; initial assessment of the patient,
including administration of validated rating scales, with the
development of an individualized treatment plan; review by the
psychiatric consultant with modifications of the plan if recommended;
entering patient in a registry and tracking patient follow-up and
progress using the registry, with appropriate documentation, and
participation in weekly caseload consultation with the psychiatric
consultant; and provision of brief interventions using evidence-based
techniques such as behavioral activation, motivational interviewing,
and other focused treatment strategies), G0503 (Subsequent psychiatric
collaborative care management, first 60 minutes in a subsequent month
of behavioral health care manager activities, in consultation with a
psychiatric consultant, and directed by the treating physician or other
qualified health care professional, with the following required
elements: tracking patient follow-up and progress using the registry,
with appropriate documentation; participation in weekly caseload
consultation with the psychiatric consultant; ongoing collaboration
with and coordination of the patient's mental health care with the
treating physician or other qualified health care professional and any
other treating mental health providers; additional review of progress
and recommendations for changes in treatment, as indicated, including
medications, based on recommendations provided by the psychiatric
consultant; provision of brief interventions using evidence-based
techniques such as behavioral activation, motivational interviewing,
and other focused treatment strategies; monitoring of patient outcomes
using validated rating scales; and relapse prevention planning with
patients as they achieve remission of symptoms and/or other treatment
goals and are prepared for discharge from active treatment), and G0504
(Initial or subsequent psychiatric collaborative care management, each
additional 30 minutes in a calendar month of behavioral health care
manager activities, in consultation with a psychiatric consultant, and
directed by the treating physician or other qualified health care
professional (list separately in addition to code for primary
procedure); (use G0504 in conjunction with G0502, G0503), used to bill
for monthly services furnished using the psychiatric collaborative care
model (CoCM), an evidence-based approach to behavioral health
integration that enhances ``usual'' primary care by adding care
management support and regular psychiatric inter-specialty
consultation. The G-codes were valued
[[Page 43897]]
to account for the work of the treating physician or other qualified
health care professionals, based on a direct crosswalk to the work
values for the complex Chronic Care Management (CCM) services, CPT
codes 99487 (Complex chronic care management services with the
following required elements: multiple (two or more) chronic conditions
expected to last at least 12 months, or until the death of the patient,
chronic conditions that place the patient at significant risk of death,
acute exacerbation/decompensation, or functional decline, comprehensive
care plan established, implemented, revised, or monitored, moderate or
high complexity medical decision making; first 60 minutes of clinical
staff time directed by a physician or other qualified health care
professional, per calendar month.) and 99489 (Complex chronic care
management services with the following required elements: multiple (two
or more) chronic conditions expected to last at least 12 months, or
until the death of the patient, chronic conditions that place the
patient at significant risk of death, acute exacerbation/
decompensation, or functional decline, comprehensive care plan
established, implemented, revised, or monitored, moderate or high
complexity medical decision making; each additional 30 minutes of
clinical staff time directed by a physician or other qualified health
care professional, per calendar month (List separately in addition to
code for primary procedure)). The valuation also accounted for the work
of the psychiatric consultant, based on an estimated 10 minutes of
psychiatric consultant time per patient per month, such that the work
RVU was based on a crosswalk to the work per minute of a level 3
established patient office visit. These G-codes were replaced by CPT
codes 99492, 99493, and 99494, which we established for payment under
the PFS in the CY 2018 PFS final rule (82 FR 53077 and 53078). In the
CY 2021 PFS final rule (85 FR 84548 through 84574), we increased the
work RVUs for certain CPT codes that rely upon or are analogous to
office/outpatient evaluation and management (O/O) (E/M) visits,
consistent with the increases in values finalized for O/O E/M visits
for CY 2021, such that the CoCM services valuation were updated as
follows: 99492 (work RVU increased from 1.70 to 1.88), 99493 (work RVU
increased from 1.53 to 2.05) and 99494 (work RVU remained 0.82).
Interested parties have expressed concerns regarding the current
valuation of CoCM and requested revaluation for these services. They
stated that the current valuation undervalues the medical decision-
making performed by the billing practitioner and psychiatric consultant
and undervalues the labor rates assigned to the CoCM service. The
interested parties recommend valuing the work RVUs for the two
physicians or other qualified health care professional based on a
blended rate based on level 4 and 5 O/O E/M visits based on medical
decision-making, CPT codes 99204 and 99205 (for new patients), and
99214 and 99215 (for established patients), to account for the medical
decision-making required for the CoCM service. CPT code 99492 would be
adjusted from a work RVU of 1.88 to 3.67, 99493 from a work RVU of 2.05
to 2.99, and 99494 from a work RVU of 0.82 to 1.50. The interested
parties noted that their recommendation would result in a higher work
RVU for the initial psychiatric collaborative care management service,
CPT code 99492, compared to the subsequent psychiatric collaborative
care management service, CPT code 99493, since the initial month
generally involves a new patient requiring more medical decision
making. The interested parties recommend valuing CPT code 99494 at 50
percent of CPT code 99493. In addition, the interested parties
requested refinements to the direct PE inputs, specifically for the
Behavioral Health Care Manager clinical labor type (L057B). They
recommend increasing the clinical labor value for Behavioral Health
Care Manager (L057B) from a per minute rate of $0.57 to $0.70 per
minute by crosswalking the valuation to CORF social worker/psychologist
(L045C), rather than to the genetic counselors (L057A) which was used
when the original CoCM G-codes were established.
After reviewing the feedback from the interested parties, we
reviewed the valuation of the CoCM codes and considered Medicare claims
data for levels 3 through 5 O/O E/M services. The Medicare claims data
shows that level 5 E/M visits (CPT codes 99205 and 99215), which
represent the highest complexity of evaluation and management services,
are billed substantially less frequently than level 3 E/M services (CPT
codes 99203 and 99213) and level 4 E/M services (CPT codes 99204 and
99214). Based upon this billing pattern, we believe that a blended
level 3 and 4 E/M rate would be more appropriate to value CoCM.
Therefore, we propose to refine the work RVUs of CoCM as follows: CPT
codes 99492 would be adjusted from a work RVU of 1.88 to 2.75, 99493
from a work RVU of 2.05 to 2.26, and 99494 from a work RVU of 0.82 to
1.13, which is 50 percent of 99493.
We also propose conforming changes to the valuation of HCPCS codes
G2214, G0568, and G0569, which also describe psychiatric collaborative
care services. For HCPCS code G2214 (Initial or subsequent psychiatric
collaborative care management, first 30 minutes in a month of
behavioral health care manager activities, in consultation with a
psychiatric consultant, and directed by the treating physician or other
qualified health care professional), we propose to refine the work RVU
from 0.77 to 1.13, representing one half of the time described by the
existing code that describes subsequent months of CoCM services (CPT
code 99493), consistent with how the code was valued in the CY 2021 PFS
final rule (85 FR 84547 through 84548). For HCPCS code G0568 (Initial
psychiatric collaborative care management, in the first calendar month
of behavioral health care manager activities, in consultation with a
psychiatric consultant, and directed by the treating physician or other
qualified health care professional, with the following required
elements: outreach to and engagement in treatment of a patient directed
by the treating physician or other qualified health care professional,
initial assessment of the patient, including administration of
validated rating scales, with the development of an individualized
treatment plan, review by the psychiatric consultant with modifications
of the plan if recommended, entering patient in a registry and tracking
patient follow-up and progress using the registry, with appropriate
documentation, and participation in weekly caseload consultation with
the psychiatric consultant, and provision of brief interventions using
evidence-based techniques such as behavioral activation, motivational
interviewing, and other focused treatment strategies (list separately
in addition to the advanced primary care management code)), we propose
to refine the work RVU from 1.88 to 2.75, aligning with the direct
crosswalk to the work RVU of CPT code 99492. For HCPCS code G0569
(Subsequent psychiatric collaborative care management, in a subsequent
month of behavioral health care manager activities, in consultation
with a psychiatric consultant, and directed by the treating physician
or other qualified health care professional, with the following
required elements: tracking patient follow-up and progress using the
registry, with appropriate
[[Page 43898]]
documentation, participation in weekly caseload consultation with the
psychiatric consultant, ongoing collaboration with and coordination of
the patient's mental health care with the treating physician or other
qualified health care professional and any other treating mental health
providers, additional review of progress and recommendations for
changes in treatment, as indicated, including medications, based on
recommendations provided by the psychiatric consultant, provision of
brief interventions using evidence-based techniques such as behavioral
activation, motivational interviewing, and other focused treatment
strategies, monitoring of patient outcomes using validated rating
scales, and relapse prevention planning with patients as they achieve
remission of symptoms and/or other treatment goals and are prepared for
discharge from active treatment (list separately in addition to
advanced primary care management code)), we propose to refine the work
RVU from 2.05 to 2.26, as this code was valued based on a direct
crosswalk to the work RVU of CPT code 99493.
Additionally, consistent with the changes proposed for CPT codes
99492-99494, we propose refinements to the direct PE inputs for HCPCS
codes G2214, G0568, and G0569 by revaluing the rate of Behavioral
Health Care Manager (L057B) with a per minute rate of $0.57 to $0.70.
This proposed change is based on a crosswalk of valuing Behavioral
Health Care Manager (L057B) to the clinical labor CORF social worker/
psychologist (L045C), as opposed to basing the rates to genetic
counselors as discussed in the CY 2017 final rule (81 FR 80350). We
also note that HCPCS codes G2086 (Office-based treatment for opioid use
disorder, including development of the treatment plan, care
coordination, individual therapy and group therapy and counseling; at
least 70 minutes in the first calendar month), G2087 (Office-based
treatment for opioid use disorder, including care coordination,
individual therapy and group therapy and counseling; at least 60
minutes in a subsequent calendar month), and G2088 (Office-based
treatment for opioid use disorder, including care coordination,
individual therapy and group therapy and counseling; each additional 30
minutes beyond the first 120 minutes (list separately in addition to
code for primary procedure)) include clinical labor minutes for a
Behavioral Health Care Manager (L057B), and therefore as part of this
proposal, we are also proposing that that same increase in valuation
for L057B from $0.57 to $0.70 would also apply to HCPCS codes G2086-
G2088.
We welcome comments on these proposals.
(52) Tympanostomy (HCPCS Code G0561)
In January 2026, the Practice Expense (PE) Subcommittee reviewed
the following practice expense only add-on HCPCS code G0561
(Tympanostomy with local or topical anesthesia and insertion of a
ventilating tube when performed with tympanostomy tube delivery device,
unilateral) on the Medicare Physician Fee Schedule which is currently
contractor priced.
The RUC recommended one direct PE input for a new supply item, an
Automated PE tube delivery device (SD395), and submitted invoices to
price the supply at $497.50. We are proposing the RUC-recommended
direct PE input for HCPCS code G0561 without refinement.
The RUC did not recommend, and we are not proposing a work RVU for
HCPCS code G0561, which has been designed as a PE only service.
(53) Evaluation and Management (E/M) Visit Complexity Add-On (HCPCS
Code G2211)
(a) Background
In the CY 2024 PFS final rule (88 FR 78970 through 78982), we
finalized separate payment for the O/O E/M visit complexity add-on
code, HCPCS code G2211 (Visit complexity inherent to evaluation and
management associated with medical care services that serve as the
continuing focal point for all needed health care services and/or with
medical care services that are part of ongoing care related to a
patient's single, serious condition or a complex condition. (Add-on
code, list separately in addition to office/outpatient evaluation and
management visit, new or established)). This policy was originally
proposed in CY 2019, as part of a proposed overhaul to the E/M code set
(83 FR 59628) where we proposed two codes, one for primary care and one
for non-procedure specialty care. We learned that the CPT Editorial
Panel and AMA RUC were planning to review and refine the O/O E/M code
set, so we did not finalize this proposal or the other proposed changes
to the E/M code set. The CPT Editorial Panel and AMA RUC reviewed and
refined the O/O E/M code set, which were finalized by CMS in the CY
2021 PFS final rule (84 FR 62844 through 62856). We combined the two
proposed complexity add-on codes into one, and we finalized separate
coding and payment for HCPCS code add-on code GPC1X in the CY 2020 PFS
final rule (84 FR 62854 through 62856). This became HCPCS code G2211 in
the CY 2021 final rule (85 FR 84569). However, implementation of G2211
was delayed by Congress (section 113 of Division CC of the Consolidated
Appropriations Act, 2021 (Pub. L. 116-260, December 27, 2020) (CAA,
2021)), and we began actively paying for HCPCS code G2211 in CY 2024.
In the CY 2026 PFS final rule (90 FR 49462 through 49464), we
finalized our proposal to allow HCPCS code G2211 to be billed as an
add-on code with the home or residence E/M visits code family (CPT
codes 99341, 99342, 99344, 99345, 99347, 99348, 99349, 99350). We
finalized refinements to the code descriptor of HCPCS code G2211 (Visit
complexity inherent to evaluation and management associated with
medical care services that serve as the continuing focal point for all
needed health care services and/or with medical care services that are
part of ongoing care related to a patient's single, serious condition
or a complex condition. (Add-on code, list separately in addition to
home or residence or office/outpatient evaluation and management
service, new or established) to reflect this change.
This service is intended to recognize the longitudinal relationship
between the patient and the practitioner, which differentiates the E/M
visit from visits that are not longitudinal in nature. As discussed in
section II.E. of this proposed rule, we are continuing to examine
primary care in the PFS, and how we can appropriately recognize the
resource costs of longitudinal and especially primary care, given the
generality of E/M coding.
(b) Proposed Changes to the Billing Mechanism for Inherent Complexity
(i) Modifier MOD1
Since we began actively paying for HCPCS code G2211 in CY 2024, we
have come to believe that the resource costs of furnishing longitudinal
care for beneficiaries is not best characterized as a separate service
requiring a separate code. Rather, we believe that since this work is
an inherent part of the visit, it would be more accurately valued as a
modifier to the base E/M code. We also believe that transitioning HCPCS
code G2211 from an add-on code to a modifier will be more streamlined
from an operational perspective. This should also reduce operational
burden, as it will not require the submission of a separate claim line,
because the modifier will be placed on the claim
[[Page 43899]]
line for the associated E/M code. We are therefore proposing to replace
HCPCS code G2211 with a modifier, which we will refer to in this
proposed rule as MOD1, which is a placeholder that would be replaced
with a two-digit HCPCS modifier, if finalized.
We are proposing that modifier MOD1 will be billed under the same
circumstances that HCPCS code G2211 is billed now. We discussed in the
CY 2024 final rule (88 FR 78973) that HCPCS code G2211 was intended to
characterize the associated E/M code as a service with a practitioner
who serves as the continuing focal point for all needed health care
services, or with medical care that is part of ongoing care related to
a patient's single, serious, or complex condition. HCPCS code G2211 was
meant to describe the inherent complexity of these visits that would
otherwise be unaccounted for. The application of the add-on code is not
based on the characteristics of particular patients (even though the
rationale for valuing the code is based on recognizing the typical
complexity of patient needs), but rather the relationship between the
patient and the practitioner.
We are proposing to match the code descriptor for HCPCS code G2211
to MOD1, with some technical changes. The new proposed modifier
descriptor is: Visit complexity inherent to new or established office/
outpatient or home or residence evaluation and management service,
associated with medical care services that serve as the continuing
focal point for all needed health care services and/or with medical
care services that are part of ongoing care related to a patient's
single, serious condition or a complex condition.
(ii) Modifier MOD1 Valuation
When HCPCS code G2211 was finalized in the CY 2020 PFS final rule
(84 FR 82854 through 82855), we crosswalked it to 100 percent of the
valuation of CPT code 90785 (Interactive complexity (List separately in
addition to the code for primary procedure)), which was created to
capture additional work that occurs with certain psychiatric and
psychotherapy codes. We believed that this service was analogous to the
additional work involved in maintaining a longitudinal relationship
with patients as described by CPT code 90785. CPT code 90785 has a work
RVU of 0.33 and a physician time of 11 minutes. In reexamining this
policy after a few years of utilization, we have come to believe that a
flat rate as described by G2211 does not reflect the variation in work
of the various E/M visit levels.
[GRAPHIC] [TIFF OMITTED] TP16JY26.025
Table A-D7 illustrates that the addition of HCPCS code G2211 as an
add-on to the associated E/M visit represents a higher increase in
total value for base codes with lower total non-facility RVUs than it
does for more intense services. For example, HCPCS code G2211 has a
total RVU of 0.52 in the non-facility (NF) setting. CPT code 99212
(Office or other outpatient visit for the evaluation and management of
an established patient, which requires a medically appropriate history
and/or examination and straightforward medical decision making. When
using total time on the date of the encounter for code selection, 10
minutes must be met or exceeded.) has a total NF RVU of 1.78. So, when
HCPCS code G2211 is appended to CPT code 99212, the overall value of
the service is increased by 29 percent. However, when HCPCS code G2211
is appended to CPT code 99215 (Office or other outpatient visit for the
evaluation and management of an established patient, which requires a
medically appropriate history and/or examination and high level of
medical decision making. When using total time on the date of the
encounter for code selection, 40 minutes must be met or exceeded.) with
a NF total RVU of 5.76, it only represents a 9 percent increase in the
total value of the service. We believe that HCPCS code G2211 should
reflect an increase to the base code that is proportional across all
types of E/M visits. Therefore, we are proposing a modifier to replace
HCPCS code G2211 with the valuation of 16 percent of the base E/M code.
We established this percentage using a weighted average of the
percentage increase that G2211 comprised relative to the O/O E/M code,
weighted by HCPCS code G2211 utilization and adjusted to achieve budget
neutrality.
(c) G2211 in Medicare Accountable Care Organizations (ACOs)
(i) Background
The Medicare Shared Savings Program (Shared Savings Program)
established under section 1899 of the Act, offers doctors, hospitals,
and other health care providers an opportunity to create an Accountable
Care Organization (ACO). Shared Savings Program ACOs are groups of
doctors, hospitals, and other health care professionals that work
together to give patients high-quality, coordinated service and health
care, improve health outcomes, and manage costs.\16\ In Original
Medicare, physicians are reimbursed for reasonable and necessary
services necessary for diagnosis or treatment of illness or injury. In
an ACO, the doctor-patient relationship in Original Medicare is
expanded such that the doctors, hospitals and other health care
professionals are not just providing services under the reasonable and
necessary standard, but there is additional work conducted to manage
the beneficiaries' overall health, considering their personal health
goals and values. This is how CMS defines an ``accountable care
relationship,'' and this relationship may lead patients to be less
likely to get repeated medical tests or unnecessary services, since
clinicians consider a patient's entire health history when developing a
treatment plan, and the doctors and other health professionals
communicate and collaborate to improve the patient's
[[Page 43900]]
long-term health.\17\ CMS believes accountable care supports the
professional ethos of health professionals to take responsibility for
their patients in a way that beneficiaries expect. When these
accountable care relationships succeed and the ACO succeeds in
delivering high-quality care and reducing expenditures, the ACO may be
eligible to share in the savings. For more information on the Shared
Savings Program and policies directly relating to Shared Savings
Program, see section III.G. of this proposed rule.
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\16\ ``Accountable Care and Accountable Care Organizations.''
Centers for Medicare & Medicaid Services, CMS Innovation Center,
https://www.cms.gov/priorities/innovation/key-concepts/accountable-care-accountable-care-organizations. Accessed 16 June 2026.
\17\ ``Accountable Care and Accountable Care Organizations.''
Centers for Medicare & Medicaid Services, https://www.cms.gov/priorities/innovation/innovation-models/aco. Accessed 16 June 2026.
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The CMS Innovation Center recently announced the Long-term Enhanced
ACO Design (LEAD) Model which will launch on January 1, 2027. LEAD
builds upon previous accountable care work and was designed to attract
health care providers that have previously had limited participation in
ACOs. It also aims to encourage health care providers to deliver
preventive care, empower beneficiaries to be more actively involved in
their care, and support health care providers who serve high needs and
dually eligible beneficiaries to improve care and reduce costs.
(ii) Modifier MOD2
In the PFS, we have established a complexity add-code (HCPCS code
G2211) that we are proposing to change to a modifier (MOD1) that
supports care relationships which may approximate but are not
accountable care. This modifier is meant to recognize the additional
complexity of services associated with providing ongoing, longitudinal
care to a beneficiary. We are proposing that the complexity of care
established in that longitudinal relationship fundamentally differs in
Original Medicare where physicians are providing all reasonable and
necessary care for diagnosis and treatment of a clinical condition
versus when they are in an accountable care relationship. As previously
discussed, we are proposing applying the complexity add-on (we are
proposing to change this to a modifier) to reflect the ongoing resource
costs associated with being the focal point for all needed health care
services performed under this reasonable and necessary standard.
We believe this standard is distinct from care provided in an ACO,
where in addition to being responsible for all needed health care
services that are part of ongoing care, clinicians are also responsible
for managing the accountable care relationship, which involves managing
a beneficiary's overall health, personal goals, values, and
coordinating care with responsibility for both quality and cost. We
consider the complexity associated with serving as the focal point of
care for all necessary services within an accountable care
relationship, responsibility for the entire patient, and responsibility
for quality and cost of care, to be inherently more complex than
serving in this role outside of an accountable care relationship. We
are therefore proposing two levels for this modifier to reflect the
additional resource costs associated with accountable care.
For example, the most common condition for which HCPCS code G2211
was billed in 2024 in Original Medicare was hypertension.\18\ Outside
of an accountable care relationship, the complexity add-on (proposing
in this rule to change to a modifier) would be billed by clinicians for
E/M visits managing a beneficiary's hypertension over time. The
additional time and resource costs for serving as this focal point in
care may address a patient's reservations about initiating
pharmacologic treatment for hypertension (for example, perhaps the
beneficiary wishes to trial complementary or alternative medicine
approaches, so the clinician and patient engage in shared decision-
making to understand the risks and benefits of this approach preceding
pharmacologic intervention).\19\ They may also discuss risk factor
reduction (for example, smoking cessation) and lifestyle changes (for
example, following the dietary approaches to stop hypertension or
'DASH` diet and meeting physical activity recommendations), or perhaps
engage in motivational interviewing to facilitate behavior change.
While the current HCPCS code G2211 is meant to take into account the
additional time and resource intensity for these services, we expect
even more from clinicians participating in an ACO.
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\18\ Ganguli I, Daley NE, Hicks AL, McWilliams JM, Rosenthal MB.
Billing of Medicare's G2211 Longitudinal Care Code Among Traditional
Medicare Beneficiaries. JAMA. 2026;335(11):1003-1006. doi:10.1001/
jama.2026.0424.
\19\ ``Hypertension (High Blood Pressure).'' National Center for
Complementary and Integrative Health, U.S. Department of Health and
Human Services, July 2018, https://www.nccih.nih.gov/health/hypertension-high-blood-pressure. Accessed 16 June 2026.
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For example, a beneficiary has general anxiety disorder and
hypertension and monitors their blood pressure at home. They have an
instance in which their blood pressure exceeds 140/90mmHg, and they
also feel panic or a sense of impending doom or chest pain. They decide
to go to the emergency room, but the slightly elevated blood pressure
may or may not be the physiologic trigger of their symptoms. This
patient may continue to seek care at the emergency room for similar
episodes indefinitely unless their practitioner identifies this trend
on their own and provides education to the patient on distinguishing
the symptoms of anxiety from hypertension, and when it may be
appropriate to go to the emergency room. If this same patient was in an
ACO, that ACO might have already established admission discharge
transfer (ADT) notifications which would alert the team (near-real
time) for the admission. This would allow for earlier intervention to
ensure that both the patient's anxiety and blood pressure were being
managed in the correct setting, and that the patient had the best
information to understand their intersecting conditions.
The additional time and resources associated with coordinating care
for this complex patient considering both quality and cost are
distinct. We are proposing differentiating the resource costs
associated with HCPCS code G2211 outside of and within an accountable
care environment to account for the additional resource costs
associated with serving as the focal point of care for the entire
beneficiary within an accountable care relationship. We are clarifying
that we do not believe every encounter a patient has within an ACO
qualifies as longitudinal. For example, if instead of presenting to the
ED, the patient calls the clinic and is able to see another ACO
participant, ACO professional, ACO provider/supplier (as each is
defined at Sec. 425.20, for the Shared Savings Program), or LEAD
Participant Provider who is available the same day, this encounter
would not necessarily meet the criteria of inherent complexity, if that
practitioner is not supporting the beneficiary's longitudinal care, and
if this visit is not more inherently complex. Simply providing an E/M
visit while being part of an ACO does not necessarily meet the
threshold of inherent complexity.
We believe that MOD2 aligns with the goals of the Shared Savings
Program and LEAD, which involve groups of health care providers working
together to enhance beneficiary health through high quality,
longitudinal primary and preventative care. One of the features of
Shared Savings Program and LEAD ACOs is that beneficiaries benefit from
ACO participants balancing goals of having total cost of care
accountability and improving quality of care, while avoiding
unnecessary services and
[[Page 43901]]
medical errors. While the specifics vary between the Shared Savings
Program and the LEAD model, in general, participating ACOs are required
to report quality measures that align with these objectives, and they
are measured against their past performance, and the performance of
similar ACOs.\20\
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\20\ https://www.cms.gov/medicare/payment/fee-for-service-providers/shared-savings-program-ssp-acos/guidance-regulations#quality.
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While these measures span a broad area of topics, many measures are
focused on longitudinal care and care coordination, such as chronic
disease management, preventive care and screenings and reducing
avoidable hospitalizations.\21\ Current participation in the Shared
Savings Program helps provide and future participation in LEAD will
help provide a framework to allow health care providers to collaborate
to give coordinated high-quality care, while also enabling investment
to achieve those goals. For example, health care providers may join
ACOs to help defray the costs of large capital investments such as
electronic medical records.\22\ Health care providers also cite help
with care coordination and quality reporting as a reason to join,
increasing their access to resources and expertise to help with these
areas in their practice.\23\ We also want to encourage health care
providers to form and join ACOs to coordinate care for their
beneficiaries. Similarly, ACO participants, ACO professionals, ACO
providers/suppliers (as each is defined at Sec. 425.20, for the Shared
Savings Program), and LEAD Participant Providers often provide advanced
primary care to beneficiaries regardless of whether a particular
beneficiary is assigned, aligned, or attributed to their ACO. Advanced
primary care is a patient-focused approach to care wherein health care
providers take extra steps to actively manage a beneficiary's health
care needs.\24\ Further, additional beneficiaries to whom a health care
provider provides care might be assigned to that ACO in the future, so
encouraging similar care to be provided to all beneficiaries served by
health care providers in ACOs would be in the interest of the ACO. This
level of care coordination, which includes advanced primary care, is
often inherent by virtue of participation in an ACO.\25\
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\21\ https://www.cms.gov/priorities-innovation-key-concepts-accountable-care-accountable-care-organizations.
\22\ https://www.cbo.gov/publication/60213.
\23\ Berenson, R.A., Burton, R.A., & McGrath, M. (2016). Do
accountable care organizations (ACOs) help or hinder primary care
physicians' ability to deliver high-quality care? Healthcare, 4(3),
155-159. https://doi.org/10.1016/j.hjdsi.2016.02.011.
\24\ https://www.cms.gov/medicare/payment/fee-schedules/physician-fee-schedule/advanced-primary-care-management-services and
https://www.medicare.gov/coverage/advanced-primary-care-management-services.
\25\ Centers for Medicare & Medicaid Services. Care
Transformation Toolkit. CMS Innovation Center; 2021. Available at
https://www.mathematica.org/publications/care-transformation-toolkit.
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We are proposing to match the descriptor of MOD2 to MOD1 and HCPCS
G2211, with some small differences. The new proposed modifier
descriptor is: Visit complexity inherent to new or established office/
outpatient or home or residence evaluation and management service,
associated with medical care services furnished by a participant or
practitioner participating in a Medicare accountable care organization.
Services must serve as the continuing focal point for all needed health
care services and/or be part of ongoing care related to a patient's
single, serious condition or complex condition.
(ii) Modifier Valuation for Medicare ACO Participants
With these goals in mind, we are proposing that, in place of
reporting G2211, ACOs would have the option to report a modifier on a
claim (referred to in this proposed rule as placeholder MOD2, which if
finalized would be replaced with a two-digit HCPCS modifier), which
will be valued at 32 percent of the associated E/M visit when performed
by Shared Savings Program ACO participants, ACO professionals, and ACO
providers/suppliers (as each is defined at Sec. 425.20), as well as
Participant Providers in the LEAD Model. We are proposing that MOD2
would pay twice the rate of MOD1 to better account for the inherent
complexity of some visits in the ACO context, specifically applying to
Shared Savings Program and LEAD ACOs in situations that require
increased time and intensity. This increased valuation is meant to
reflect the cognitive work of providing longitudinal care, follow-up
discussions through an assigned care coordinator with the beneficiary
or other providers, and expanded access to educational resources, care
options, and provider communication methods. The value-based care
provided through a Shared Savings Program or LEAD ACO puts greater
emphasis on integrated care, meaning health care providers work
together to address a person's physical, mental, behavioral and social
needs. In this way, providers treat an individual as a whole person,
rather than focusing on a specific health issue or
disease.26 27
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\26\ https://www.cms.gov/priorities/innovation/key-concepts/value-based-care.
\27\ https://www.cms.gov/priorities/innovation/key-concepts/person-centered-care.
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The differential payment we propose to provide to Shared Savings
Program ACO participants, ACO professionals, and ACO providers/
suppliers (as each is defined at Sec. 425.20) and to LEAD Participant
Providers would further support the CMS Innovation Center 2025 Strategy
to Make America Healthy Again which focuses on empowering Americans to
achieve their health goals and live healthier lives.\28\ We recognize
that not all E/M visits represent longitudinal care and so we would not
expect MOD2 to be included on all claims for E/M visits, only visits
that have an increased visit complexity that requires an increased
valuation, as described in the examples provided earlier in this
section.
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\28\ https://www.cms.gov/priorities/innovation/about/strategic-direction.
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(iii) Use of MOD2 Modifier by ACOs
Modifier MOD2 would be exclusively available for ACO participants,
ACO professionals, and ACO providers/suppliers (as each is defined at
Sec. 425.20, for the Shared Savings Program), as well as LEAD
Participant Providers, when the visit complexity is met, provided the
individual is a medical professional who can bill office and outpatient
E/M visits or home visit services, regardless of specialty. Utilization
and claims of either modifier will be included in ACOs' expenditure
calculations for benchmarking and performance year expenditures and
used in the determination of total cost of care.
As described earlier in this section, we are proposing a
differential payment for MOD2 that is meant to provide a meaningful
increase in the way we pay for primary care provided by ACO
participants, ACO professionals, and ACO providers/suppliers (as each
is defined at Sec. 425.20, for the Shared Savings Program), as well as
LEAD Participant Providers who often provide additional care
coordination to beneficiaries in their care as demonstrated by their
participation in an ACO, as described in the examples provided earlier
in this section. We are further proposing that the use of this modifier
be voluntary; and ACO participants, ACO professionals, ACO providers/
suppliers (as each is defined at Sec. 425.20, for the Shared Savings
Program), and LEAD Participant Providers would determine if this
modifier is necessary based on visit complexity and would append MOD1,
MOD2, or no modifier, as appropriate. Additionally, we are proposing
that ACO participants, ACO professionals,
[[Page 43902]]
and ACO provider/suppliers (as each is defined at Sec. 425.20, for the
Shared Savings Program), as well as LEAD Participant Providers may bill
this modifier for all beneficiaries to whom they provide care,
regardless of whether that beneficiary is assigned, aligned, or
attributed to an ACO, to encourage similar care to be provided to all
beneficiaries served by health care providers who participate in ACOs.
Given that ACO Primary Care Flex (ACO PC Flex) Model participation is
predicated on participation in the Shared Savings Program, we are
proposing that ACO PC Flex Model ACOs may also utilize the MOD2
modifier. Finally, we are proposing that LEAD Participant Providers
billing under a Participant TIN that is in a LEAD ACO may bill modifier
MOD2. Refer to the discussion later in this section for additional
information on the use of modifier MOD2 on alignment in the LEAD model.
(A) Impacts on Assignment of Beneficiaries to Shared Savings Program
ACOs
HCPCS code G2211 is included in the definition of primary care
services used for purposes of assignment under Sec. 425.400(c).
Although we are proposing that HCPCS code G2211 be deleted, under this
proposal, it would remain in the regulations at Sec. 425.400(c) to be
included for purposes of determining the population of OM beneficiaries
for whose care the ACO is accountable under 42 CFR subpart F, and for
determining whether an ACO has achieved savings under 42 CFR subpart G,
and will continue to be used for assigning beneficiaries to an ACO in
benchmark years during which HCPCS code G2211 was still an allowable
service. If the proposal is finalized, the code will no longer be
payable, and there will be no impact on future calculations of allowed
charges used for purposes of assignment.
Modifier MOD2 can be appended to O/O or home or residence E/M
services exclusively by ACO participants, ACO professionals, ACO
providers/suppliers (as each is defined at Sec. 425.20, for the Shared
Savings Program), and LEAD Participant Providers who can bill O/O or
home or residence E/M service, regardless of specialty. In performing
claims-based assignment under the Shared Savings Program, CMS
determines whether allowed charges for a beneficiary's primary care
services (as identified for ACO professionals, including at Electing
Teaching Amendment hospitals and Method II Critical Access Hospitals,
and services furnished at an FQHC or RHC) in an ACO are greater than
allowed charges for the beneficiary's primary care services in any
other ACO, or other individual health care providers, or groups of
health care providers identified by Medicare-enrolled billing TINs or
CMS Certification Numbers that are not participating in the Shared
Savings Program. In making this determination, we determine where the
beneficiary received the plurality of his or her primary care services.
The allowed charges associated with O/O or home or residence E/M
services billed with or without modifiers MOD1 or MOD2 will be used in
determining beneficiary assignment. Since the CPT codes identified as
O/O or home or residence E/M services are included in the definition of
primary care services used for purposes of assignment as defined in 42
CFR 425.400(c), we do not believe that changes to the regulatory text
are required. Certain operational changes will need to be implemented
which will be communicated via Change Request,\29\ Medicare Learning
Network (MLN) Matters[supreg] article,\30\ or other sub-regulatory
guidance.
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\29\ Available at https://www.cms.gov/medicare/regulations-guidance/transmittals.
\30\ Available at https://www.cms.gov/training-education/medicare-learning-networkr-mln/resources-training/mln-matters-articles.
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(B) Impacts on Assignment of Beneficiaries to LEAD ACOs
In LEAD, if this proposal is finalized, we will handle the deletion
of HCPCS code G2211 and the transition to the modifiers similarly to
the Shared Savings Program. As indicated in Appendix C of the LEAD
Request for Applications, the HCPCS code G2211 code is one of the
Primary Care Qualified Evaluation and Management (PQEM) services that
CMS uses to align beneficiaries to LEAD ACOs via claims-based
alignment. We will continue to use HCPCS code G2211 allowable charges
to conduct claims-based alignment in LEAD when HCPCS code G2211 was an
allowable service in the requisite claims look back period. For
example, when conducting initial claims-based alignment in Performance
Year (PY) 2027, we will reference claims from October 1, 2025 to
September 30, 2026. HCPCS code G2211 allowable charges will be included
in the claims-based alignment run since it is an allowable service
during this period.
When aligning beneficiaries to LEAD ACOs, CMS looks first for an
existing primary care relationship within the claims lookback period.
If 10 percent or more of a beneficiary's PQEM allowable charges
(measured by dollar amount) were billed by physicians or non-physician
health care providers with a primary-care specialty (family medicine,
internal medicine, geriatrics, general practice, nurse practitioner,
physician assistant, and clinical nurse specialist), alignment is based
solely on these primary care providers. If less than 10 percent of a
beneficiary's PQEM allowable charges were billed by primary-care
specialties, alignment considers certain non-primary care providers
that manage chronic or complex conditions (for example, cardiology,
nephrology, endocrinology, psychiatry, etc.). The beneficiary is
aligned to a LEAD ACO if the Participant TIN that furnished the largest
share of allowable charges incurred for PQEM services during the
lookback period is participating in a LEAD ACO.
Once the claims-based alignment look back period rolls forward to
include 2027 (and future years) the LEAD alignment methodology will
include the allowed charges associated with modifier MOD1 and MOD2 when
conducting claims-based alignment (the underlying O/O or home or
residence E/M service that will be modified by MOD1 and MOD2 are
already LEAD PQEM services). LEAD ACOs will be accountable for
expenditures incurred by using either modifier MOD1 or MOD2.
Expenditures associated with modifier MOD1 and MOD2 will be included in
total Medicare Parts A and B expenditures when CMS conducts financial
settlement for LEAD ACOs. More information on the impact to claims
processing, capitated payments, and LEAD benchmarks will be shared with
ACOs that were selected for participation in LEAD in PY 2027.
(iv) MOD1 and MOD2 Billed With Modifier -25
When we finalized the HCPCS code G2211 policy in the CY 2021 PFS
final rule (85 FR 84572), we did not limit the use of HCPCS code G2211
with O/O E/M visits in which CPT Modifier -25 was appended. CPT
Modifier -25 denotes a significant, separately identifiable O/O E/M
visit by the same physician or other qualified health care professional
on the same day as a procedure or other service. We finalized HCPCS
code G2211 as payable in the CY 2024 PFS final rule (88 FR 78974), and
in the CY 2025 PFS final rule (89 FR 97856 through 97858), we finalized
that we would allow payment of HCPCS code G2211 with -Modifier 25 when
the O/O E/M base code is reported by the same practitioner on the same
day as an annual wellness visit (AWV), vaccine administration, or any
Medicare Part B preventative service when furnished in
[[Page 43903]]
the office or outpatient setting. For CY 2027, we are proposing to
maintain the same limitations we established for HCPCS code G2211 in
the CY 2025 PFS final rule (89 FR 97856 through 97858) for MOD1 and
MOD2 when billed with Modifier -25.
Later in this section, we are making additional proposals related
to changes for payment when modifier -25 is appended. Given these
changes, we are seeking comment on whether we should consider changes
to this policy, such as allowing MOD1 or MOD2 to be billed with
modifier -25 when an O/O E/M is performed on the same day as a 0-, 10-,
or 90- day global procedure?
(54) Shared Medical Appointment (HCPCS Code GSMAS)
In accordance with President Trump's Executive Order,
``Establishing the President's Make America Healthy Again Commission,''
\31\ the Administration is directing agency focus towards understanding
and drastically lowering chronic disease rates. As part of this
commitment, we remain focused on the prevention and management of
chronic disease, including through approaches that address underlying
behavioral and lifestyle drivers of health.
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\31\ https://www.whitehouse.gov/presidential-actions/2025/02/establishing-the-presidents-make-america-healthy-again-commission/.
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In CY 2026, we solicited feedback on how CMS could further support
the prevention and management of chronic diseases. In response to our
request for information on chronic disease prevention and management,
commenters indicated that many services that help prevent and manage
chronic disease, such as lifestyle modification support, health
education, and peer support, require time, coordination and
multidisciplinary engagement that is not adequately supported under the
current PFS. Additionally, many commenters indicated that social
isolation and loneliness is a persistent barrier to effective care for
Medicare beneficiaries. The commenters indicated that although health
care providers are already implementing interventions to identify and
address social isolation, these efforts are resource intensive and not
adequately supported under the current PFS.
Based on this feedback, we recognize the importance of health care
delivery approaches that enable multidisciplinary support, foster
beneficiary engagement, and encourage sustainable lifestyle and
behavioral changes. Shared medical appointments (SMAs) are one such
approach to offer a group-based environment in which beneficiaries can
receive clinical guidance while also engaging with peers facing similar
health challenges. SMAs may also help address social isolation and
loneliness for some beneficiaries.
SMAs, also known as shared medical visits or group visits, are
voluntary group-based sessions where multiple patients with a common
chronic condition, such as type 2 diabetes mellitus, receive medical
care together. In general, SMAs involve more than one healthcare
provider, such as a person trained or skilled in delivering patient
education or facilitating patient interaction and a prescribing
practitioner to make and initiate a comprehensive care plan. SMAs
generally last from 60 to 120 minutes and incorporate time for social
integration, interactive education, and adjustments to the patient's
care plan.\32\ Compared with group education alone, SMAs allow patients
to participate in clinical care activities that are tailored to the
needs of both the group and the individual participants.\33\ During the
SMA session, a practitioner may meet with a patient individually in a
private or semi-private manner or conduct the visit in a group setting
where other patients are able to listen and, in some cases, contribute
to the discussion.\34\
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\32\ https://www.ncbi.nlm.nih.gov/books/NBK99776/#.
\33\ Kirsh, Susan R., Aron, David C., Johnson, Kimberly D.,
Santurri, Laura E., Stevenson, Lauren D., Jones, Katherine R., and
Jagosh, Justin. ``A realist review of shared medical appointments:
How, for whom, and under what circumstances do they work?''
Available from https://pmc.ncbi.nlm.nih.gov/articles/PMC5291948/pdf/12913_2017_Article_2064.pdf.
\34\ Thompson-Lastad, Ariana. ``Group Medical Visits as
Participatory Care in Community Health Centers.'' Available from
https://pmc.ncbi.nlm.nih.gov/articles/PMC6500445/pdf/nihms-1015904.pdf.
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Reported advantages of shared medical appointments include
providing patients more time with their health care provider, creating
opportunities for patients to learn from and share self-management
strategies with one another, improving access to care, incorporating
nonpharmacologic treatment approaches, enhancing the overall quality of
care, and helping reduce emergency department visits.\35\
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\35\ Lacagnina, Salvatore, Tips, Jean, Pauly, Kaitlyn, Cara,
Kelly, and Karlsen, Micaela. ``Lifestyle Medicine Shared Medical
Appointments.'' Available from https://pmc.ncbi.nlm.nih.gov/articles/PMC7781059/.
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Currently there is no CPT or HCPCS code specifically designated for
SMAs. However, practitioners typically bill SMAs using existing
Evaluation and Management (E/M) codes, CPT codes 99212-99215, based on
medical decision-making criteria; and if another billable clinician
such as a registered dietician assists with the SMA, the registered
dietician may also bill for their portion of the SMA separately (for
example, CPT code 97804 (Medical nutrition therapy; group (2 or more
individual(s)), each 30 minutes)). Therefore, we propose to create
coding and valuation specifically for SMAs.
We propose that SMAs be limited to beneficiaries who have received
a professional service from the billing physician or other qualified
health professional or another physician or other qualified health care
professional of the exact same specialty and subspecialty who belongs
to the same group practice within the previous 12 months. We believe
this requirement is necessary to ensure beneficiaries have an existing
clinical relationship with the practitioner before the beneficiary is
integrated into a group-based medical care setting.
We propose requiring beneficiaries to consent to SMA participation,
since they may elect to receive individual medical appointments
instead. Additionally, we propose that beneficiaries must consent to
confidentiality terms because personal health information would be
discussed in the group setting.
SMA sessions generally last 60 to 120 minutes and may include up to
25 patients, however SMAs most commonly consist of 6 to 10
patients.\36\ We propose establishing SMAs as 60-minute sessions with a
maximum of 10 beneficiaries per session.
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\36\ https://www.hsrd.research.va.gov/publications/esp/shared-med-appt.pdf.
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The expansion of telehealth services has increased opportunities
for SMAs to improve access for individuals in geographically remote
areas, and those with transportation challenges. We propose that SMA
sessions can be held either in-person or via telehealth, and we are
proposing to add the SMA service to the Medicare Telehealth list
accordingly.
We propose that each shared SMA session be documented in each
participating beneficiary's medical record. Each beneficiary receives
individualized clinical care, and the medical record must reflect the
specific services that the individual beneficiary received during the
SMA session. The need for individualized care may depend on the
intervention and surrounding evidence. Therefore, if a beneficiary
requires a level of individualized care that extends beyond what can
appropriately be provided
[[Page 43904]]
within the group-based session of a SMA, that individualized care
should be provided in a separate individual medical appointment. The
services provided to the group as a whole at each session would also
need to be captured in the medical record. We seek comments on
additional guardrails to consider in preventing fraud, waste and abuse
when billing SMAs, such as following an evidence-based protocol for
delivery of the intervention, conducting fidelity checks to ensure it
is being delivered as intended, identifying key outcomes and goals that
are established in shared decision making, and ensuring that the
interventionist is trained in the intervention as appropriate.
SMAs are an approach in managing chronic conditions, especially
among motivated patients.\37\ SMAs are an appropriate healthcare
delivery approach for conditions that are modifiable with lifestyle
change, including diabetes mellitus, obesity, hypertension, and
hyperlipidemia, such that behavioral changes including diet, physical
activity, and self-management- can influence health outcomes.
Therefore, we propose to establish coding and payment for SMAs provided
for medical conditions that are modifiable with lifestyle change. We
seek comment on how to determine when SMAs would be appropriate,
including identifying which medical conditions would be considered
modifiable with lifestyle change, and suggest we would typically
consider those conditions with medical guidelines that include
lifestyle change as part of prevention and treatment of the condition
in this category, such as evidence-based interventions that support
lifestyle change.\38\ For example, the 2026 Standards of Care in
Diabetes published by the American Diabetic Association (ADA) include
lifestyle changes including improving nutrient composition and reducing
caloric intake, establishing physical activity regimens to support
weight loss, and highlighting the role of Medical Nutrition Therapy
(MNT) as part of nutrition education.\39\ While the exact content the
SMA and desired behavioral change would vary (for example, improving
diet and exercise as part of both prevention and management of Type 2
Diabetes) we would not consider medication adherence or titrating
medications for Type 2 Diabetes to be appropriate for an SMA, but we
would consider SMAs focused on improving nutrient composition to be an
appropriate SMA activity, for example. CMS acknowledges the substantial
changes in patients' lives associated with coping with chronic illness,
the behavioral modifications inherent in managing serious and
unexpected illnesses, however we would reserve SMA provision for just
those conditions which may be treated or prevented with lifestyle
changes.
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\37\ https://pmc.ncbi.nlm.nih.gov/articles/PMC2464960/pdf/349.pdf.
\38\ Centers for Disease Control and Prevention. ``Evidence-
Based Intervention Planning Guides.'' CDC: Cancer, National Center
for Chronic Disease Prevention and Health Promotion, 21 May 2024,
https://www.cdc.gov/cancer/php/ebi-planning-guides/index.html.
Accessed 7 July 2026
\39\ American Diabetes Association Professional Practice
Committee for Diabetes. ``5. Facilitating Positive Health Behaviors
and Well-Being to Improve Health Outcomes: Standards of Care in
Diabetes--2026.'' Diabetes Care, vol. 49, suppl. 1, 2026, pp. S89-
S131, https://doi.org/10.2337/dc26-S005.
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SMAs typically involve multiple healthcare providers, usually two
to four. The sessions are generally led by a physician, physician
assistant (PA), or an advanced practice registered nurse (APRN), and
may have ancillary staff help when the provider is meeting with
patients individually.\40\ We propose that a SMA session is billed and
led by a physician or qualified nonphysician practitioner and may
include other qualified healthcare professionals, clinical staff, or
auxiliary personnel. We propose that HCPCS code GSMAS would be billed
once per patient, per session and would accept any documentation to
demonstrate the care was rendered so long as the physician or qualified
nonphysician practitioner co-signature is included. In instances where
another qualified healthcare professional, such as a registered
dietitian, provides a service during the SMA session, such as CPT code
97804 (Medical nutrition therapy; group (2 or more individual(s)), each
30 minutes), that service is considered part of the SMA and should not
be billed separately, in addition to the physician or qualified
nonphysician practitioner billing for the SMA.
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\40\ https://pmc.ncbi.nlm.nih.gov/articles/PMC7781059/pdf/10.1177_1559827620943819.pdf.
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We propose requiring each SMA session to include the following
components:
Evaluation and Management (E/M) elements, consistent with
the complexity of the beneficiary's condition. Individualized clinical
care with medical documentation in the medical record that reflects the
specific services that the individual beneficiary received during the
SMA session.
Education, based upon evidence-based content, and
discussions related to self-care, wellness, and disease management.
Discussion of positive lifestyle changes, focusing on
behavior modification. Medication management, as clinically appropriate
and applicable.
In the event it is medically necessary for a beneficiary to receive
an E/M visit on the same day as a SMA by the same physician or other
qualified health professional or another physician or other qualified
health care professional of the exact same specialty and subspecialty
who belongs to the same group practice, we propose that any time and
effort cannot be counted more than once. We propose not to consider and
treat this as two E/M same-day visits and seek public comment on this
proposal. Additionally, we seek comments on what components must be
required for each SMA session.
We propose the following descriptor for SMAs:
HCPCS code GSMAS: Voluntary, group-based medical session involving
multiple patients with common medical condition(s), receiving medical
care in a group setting; billed and led by a physician or qualified
nonphysician practitioner and may include services provided by other
qualified healthcare professionals, clinical staff, or auxiliary
personnel under the direction of the supervising physician or other
practitioner. Session integrates group education, counseling, and peer
support with individualized patient clinical assessment and care, 2-10
patients, billed once per patient, per session.
Because SMA sessions would integrate group education, counseling,
and peer support with individualized patient clinical assessment and
care, in developing the valuation for the SMA HCPCS code, we propose to
use a building block methodology that sums up the values associated
with two reference codes. For the overall E/M elements of the SMA
service, we are incorporating the work RVUs, work time and direct PE
inputs associated with a level 3 O/O visit for an established patient,
CPT code 99213 (Office or other outpatient visit for the evaluation and
management of an established patient, which requires a medically
appropriate history and/or examination and low level of medical
decision making. When using total time on the date of the encounter for
code selection, 20 minutes must be met or exceeded.), which has a work
RVU of 1.30, and a total work time of 30 minutes, which is based on a
pre-service evaluation time of 5 minutes, an intraservice time of 20
minutes, and a post service time of 5 minutes. E/M visit level
selection does not need to be based on time; practitioners may select
the
[[Page 43905]]
visit level based on the level of medical decision making (MDM).
Additionally, as we discussed earlier in this section, we propose that
SMAs be limited to beneficiaries who have received a professional
service from the billing physician or other qualified health
professional or another physician or other qualified health care
professional of the exact same specialty and subspecialty who belongs
to the same group practice within the previous 12 months. Given this
pre-existing clinical relationship and the anticipated clinical profile
of beneficiaries that would participate in an SMA, we believe that the
level 3 O/O visit for an established patient represents the most
typical level of service for the individualized patient clinical
assessment component of the SMA.
For the group education, counseling, and peer support elements of
the SMA service, we are incorporating CPT code 96202 (Multiple-family
group behavior management/modification training for parent(s)/
guardian(s)/caregiver(s) of patients with a mental or physical health
diagnosis, administered by physician or other qualified health care
professional (without the patient present), face-to-face with multiple
sets of parent(s)/guardian(s)/caregiver(s); initial 60 minutes), which
has a work RVU of 0.43 and a total work time of 15 minutes, which is
based on a pre-service evaluation time of 2 minutes, an intraservice
time of 10 minutes, and a post service time of 3 minutes.
While a SMA may include up to 10 beneficiaries in a 60-minute
session, the individualized care for a participating beneficiary may
vary, such that some beneficiaries may receive more or less
individualized care than others; nonetheless, documentation in the
medical record must reflect the specific services that the individual
beneficiary received during the SMA session. As we price services under
the PFS based on a typical case, the proposed valuation for HCPCS code
GSMAS reflects a typical SMA session and is not intended to represent
the exact time distribution for every beneficiary in every SMA. We note
that the total work time proposed is for the purposes of valuation and
not meant as a requirement for billing. We believe this reflects a
typical amount of time for both the individualized patient clinical
assessment and the beneficiary's proportionate share of group
education, counseling, and peer support that occurs concurrently across
all participating beneficiaries during a SMA session.
Considering the aforementioned building block methodology for SMA
valuation, we are proposing a work RVU of 1.73 and a total work time of
45 minutes, which is based on a pre-service evaluation time of 7
minutes, an intraservice time of 30 minutes, and a post service time of
8 minutes.
In addition to seeking comments on establishing the proposed HCPCS
code GSMAS, we also seek comment on the proposed work RVUs, work times,
and direct PE inputs.
(55) Vaccine Adverse Effects Management (HCPCS Code GADV1)
Vaccines prevent serious illnesses and even death in persons who
receive them and serve a public health benefit. Vaccines are intended
to produce active immunity to specific antigens. An adverse reaction is
an undesirable side effect that occurs after a vaccination. Vaccine
adverse reactions are classified as (1) local; (2) systemic; or (3)
allergic. Local reactions (for example, redness) are usually the least
severe and most frequent. Systemic reactions (for example, fever) occur
less frequently than local reactions, and severe allergic reactions
(for example, anaphylaxis) are the least frequent reactions.\41\ Modern
vaccines are safe and effective; however, adverse events have been
reported after administration of each type of available vaccine.\42\
Vaccine providers should be familiar with identifying immediate-type
allergic reactions, including anaphylaxis, and be competent in treating
these events at the time of vaccine administration. Providers,
including practitioners, should also have a plan in place to contact
emergency medical services immediately in the event of a severe acute
vaccine reaction.\43\
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\41\ https://www.cdc.gov/vaccines/hcp/imz-best-practices/preventing-managing-adverse-reactions.html#cdc_report_pub_study_section_3-preventing-adverse-reactions, accessed 5/1/2026.
\42\ Ibid.
\43\ Ibid.
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Before a vaccine is licensed, the Food and Drug Administration
(FDA) takes steps to make sure the vaccine is safe. FDA requires that a
vaccine goes through extensive safety testing. Even though careful
studies are done before a vaccine is licensed, rare adverse effects may
not be found until a vaccine is given to millions of people with
different backgrounds and medical histories.\44\ According to clinical
trial data, most vaccine[hyphen]associated adverse events are mild;
however, severe adverse reactions such as anaphylaxis, myocarditis,
thrombotic events, and pneumonitis have been reported.\45\ After a
vaccine is licensed, the Vaccine Adverse Event Reporting System (VAERS)
is one of the mechanisms used to monitor for any problems, or ``adverse
events,'' that happen after vaccination.\46\
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\44\ https://vaers.hhs.gov/docs/VAERS_Brochure_for_Parents_and_Caregivers_EN_508_2026.pdf.
\45\ Suzuki T, Furuta H, Naganawa M, Hayashi K, Kiyotoshi H,
Ohta C, Ninomiya S. COVID-19 Vaccine-Induced Severe Pneumonitis.
Respirol Case Rep. 2025 Aug 21;13(8):e70274. doi: 10.1002/
rcr2.70274. PMID: 40860748; PMCID: PMC12371123.
\46\ Ibid.
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We believe that the CPT evaluation and management code set may
capture the work and clinical decision making involved in the
evaluation and management of most vaccine adverse reactions. However,
we believe that physician and nonphysician practitioners' work may not
be accurately reflected under the CPT medical decision-making framework
relating to the evaluation and management of rare and severe vaccine
adverse reactions. E/M visits, like other services under the PFS, are
valued based on an assumption of a typical case. We believe that these
are additional resource costs that don't fit under a typical E/M.
Therefore, we are proposing an add-on code and payment for diagnosis
and management of a suspected vaccine adverse reaction for services
going above and beyond those captured in an evaluation and management
(E/M) visit. These services entail listening to patient concerns,
answering questions, and building trust; selecting diagnosis strategies
and conveying information in a manner specific to each patient's
concerns, cultural and religious beliefs, and literacy level; providing
patients with appropriate resources; and planning with patients the
treatment of symptoms of vaccine adverse effects. We propose that this
add-on code, HCPCS code GADV1 (Office or other outpatient evaluation
and management service(s) for the diagnosis and treatment of vaccine
adverse effects, new or established patient; each 15 minutes personally
performed by the physician or qualified healthcare professional (list
separately in addition to CPT codes 99202, 99203, 99204, 99205, 99211,
99212, 99213, 99214, 99215, 99341, 99342, 99344, 99345, 99347, 99348,
99349, 99350)), would be payable when a physician or nonphysician
practitioner (NPP): (1) establishes and documents a temporal
relationship to vaccination, and (2) performs a medically appropriate
assessment to rule out alternative causes.
For the purposes of valuation, we are proposing a direct crosswalk
for HCPCS code GADV1 to HCPCS code G2212 (Prolonged office or other
outpatient
[[Page 43906]]
evaluation and management service(s) beyond the maximum required time
of the primary procedure which has been selected using total time on
the date of the primary service; each additional 15 minutes by the
physician or qualified healthcare professional, with or without direct
patient contact (List separately in addition to CPT codes 99205, 99215,
99483 for office or other outpatient evaluation and management
services) (do not report G2212 on the same date of service as 99358,
99359, 99415, 99416) (do not report G2212 for any time unit less than
15 minutes)) for 0.61 work RVUs and for direct PE inputs.
We welcome comments on whether a second HCPCS code for 15 minutes
of physician or NPP work time should be finalized and structured as a
stand-alone code to more accurately capture the work entailed in cases
where a patient is being evaluated for only a vaccine related
complaint, outside the context of an E/M visit being furnished for a
separate complaint. We also welcome comments on whether in finalizing
such a stand-alone HCPCS code we should crosswalk its work RVU and PE
inputs to HCPCS code G2212.
Finally, we propose adding HCPCS code GADV1 to the Medicare
Telehealth List.
(56) Health Coaching (CPT Codes 0591T, 0592T, and 0593T)
Per the Trump Administration's Executive Order, ``Establishing the
President's Make America Healthy Again Commission,'' \47\ the
Administration is directing agency focus towards understanding and
drastically lowering chronic disease rates, through thinking on
nutrition, physical activity, healthy lifestyles, over-reliance on
medication and treatments, the effects of new technological habits,
environmental impacts, and food and drug quality and safety.
Furthermore, the Executive Order directs that agencies shall ensure the
availability of expanded treatment options and the flexibility for
health insurance coverage to provide benefits to support beneficial
lifestyle changes and disease prevention.
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\47\ https://www.whitehouse.gov/presidential-actions/2025/02/establishing-the-presidents-make-america-healthy-again-commission/.
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As such, in the CY 2026 PFS proposed rule, we sought comment on a
wide range of possible rulemaking topics to promote prevention and
management of chronic disease, and in particular, asked more detailed
questions surrounding health coaching and motivational interviewing.
More specifically, we asked whether we should consider coding and
payment for health coaching and motivational interviewing beyond the
current contractor-priced CPT codes describing health coaching, as an
incident-to service performed under general supervision of a billing
practitioner, what an appropriate description would be, what types of
clinical staff perform motivational interviewing, how long a session
lasts, the overlap between motivational interviewing and health
coaching, training requirements for motivational interviewing and
health coaches, the types of clinical circumstances where motivational
interviewing and health coaching are performed, relevance for
audiovisual or audio-only telecommunication, the experience of payers
and providers using the CPT Category III CPT codes, and relevance for
Evidence-Based Programs that effectively manage or prevent chronic
disease. Commenters responded, stating that health coaching could
support CMS' goal of preventing or managing chronic disease. Many
health coaches wrote about their personal experience working with
patients with chronic diseases, assisting them in making behavioral and
lifestyle changes to self-manage their conditions, and noted that
health coaching is a low-cost and highly effective strategy that
empowers patients to manage their health. Many commenters requested
paying separately for health coaching via the creation of HCPCS G-codes
or another payment mechanism that would allow providers to reliably
schedule and bill for health coaching services. Commenters also
emphasized the importance of requiring that these services be provided
by health coaches with appropriate training and certification.
To ensure we adequately capture the time and resources for health
coaching, we are proposing conditions of payment and valuation for
0591T (Health and well-being coaching face-to-face; individual, initial
assessment, 60-90 minutes), 0592T (Individual, follow-up session, at
least 30 minutes), and 0593T (Health and well-being coaching, group [2
or more individuals], at least 30 minutes). CPT code 0593T would be
billed once per beneficiary in the group.
We are also proposing to adopt the CPT prefatory language for
0591T, 0592T, and 0593T: ``Health and well-being coaching is a patient-
centered approach wherein patients determine their goals, use self-
discovery or active learning processes together with content education
to work toward their goals, and self-monitor behaviors to increase
accountability, all within the context of an interpersonal relationship
with a coach. The health and well-being coach is qualified to perform
health and well-being coaching by education, training, national
examination and, when applicable, licensure/regulation, and has
completed a training program in health and well-being coaching whose
content meets standards established by an applicable national
credentialing organization. The training includes behavioral change
theory, motivational strategies, communication techniques, health
education and promotion theories, which are used to assist patients to
develop intrinsic motivation and obtain skills to create sustainable
change for improved health and well-being.''
We are proposing that CPT codes 0591T, 0592T, and 0593T may be
performed under direct supervision of the billing practitioner, as
defined by Sec. 410.26(a)(3). We also propose that when the service is
performed under direct supervision by auxiliary personnel, the
auxiliary personnel must have received appropriate certification to
perform the services, which includes, but is not limited to, fulfilling
the National Board for Health and Wellness Coaching National Standards,
the National Commission for Health Education Credentialing eligibility
for Certified Health Education Specialists, or the American Holistic
Nurses Credentialing national standards for Certified Nurse Coaches. In
response to the Request for Information (RFI) in the CY 2026 PFS
proposed rule (90 FR 49479 through 49480), we received comments from
interested parties pointing us towards these standards. We also propose
that appropriate certification for auxiliary personnel to perform the
services can also be fulfilled by receiving training from the evidence-
based health promotion and disease prevention programs funded under the
Older Americans Act and overseen by the Administration for Community
Living (ACL). These programs undergo review, meet significant evidence
thresholds, and have training requirements built into the program
requirements. We solicit comment on these certification standards for
auxiliary personnel performing these services.
Furthermore, we understand that occasionally, community-based
organizations (CBOs) are the entities that employ health coaches. As
noted in the CY 2023 PFS final rule (87 FR 69790) and explained in the
CY 2023 PFS proposed rule (87 FR 46102), when we refer to CBOs, we mean
public or private not-for-profit entities that provide specific
services to the community or targeted populations in
[[Page 43907]]
the community to address the health needs of those populations. They
may include community care hubs, community-action agencies, housing
agencies, area agencies on aging, centers for independent living, aging
and disability resource centers or other non-profits that apply for
grants or contract with healthcare entities to perform social services.
They may receive grants from other agencies in the U.S. Department of
Health and Human Services, including Federal grants administered by the
Administration for Children and Families (ACF), Administration for
Community Living (ACL), the Centers for Disease Control and Prevention
(CDC), the Health Resources and Services Administration (HRSA), the
Substance Abuse and Mental Health Services Administration (SAMHSA), or
State-funded grants to provide social services. Generally, we believe
such organizations know the populations and communities they serve and
may have the infrastructure or systems in place to assist practitioners
to provide these services. We note that individuals employed by CBOs
may operate under general supervision of the billing practitioner, as
long as the training and certification guidelines outlined earlier in
this section are met.
Finally, we are proposing national payment for CPT codes 0591T,
0592T, and 0593T. We are proposing to crosswalk work and direct PE
inputs for 0591T and 0592T to CPT codes 99490 (Chronic care management)
and 99439 (Chronic care management, each additional 20 minutes),
respectively, since, like Chronic Care Management (CCM), these visit-
based services are performed under general supervision. For 0593T,
since it is a group visit billed in 30-minute increments, we are
proposing to crosswalk the work and PE inputs to CPT code G0109 (Group
diabetes self-management training). Therefore, we are proposing a work
RVU of 1.00 for CPT code 0591T, 0.70 for CPT code 0592T, and 0.23 for
CPT code 0593T. Since multiple sessions in the same calendar month may
be needed, we are not proposing frequency limitations for these codes,
as long as they are reasonable and necessary. We will monitor
utilization and may re-evaluate these policies in future rulemaking.
These services were added to the Medicare Telehealth Services List in
the CY 2024 PFS Final Rule (88 FR 78859 through 78860).
We solicit comments on the valuation of these services and the
conditions of payment. We are also soliciting comment on whether should
consider creating HCPCS G-codes to describe these services for CY 2027,
rather than actively pricing these Category III CPT codes that describe
health coaching services, including what the potential benefits of G-
codes would be compared to using the existing codes.
(57) Vascular Embolization or Occlusion Procedure With Use of a
Pressure-Generating Catheter (HCPCS Code G0577)
HCPCS code C9797 (Vascular embolization or occlusion procedure with
use of a pressure-generating catheter (e.g., one-way valve,
intermittently occluding), inclusive of all radiological supervision
and interpretation, intraprocedural roadmapping, and imaging guidance
necessary to complete the intervention; for tumors, organ ischemia, or
infarction) was created for the April, 2025 Quarterly Release for the
OPPS and Ambulatory Surgical System (ASC) to describe use of a
pressure-generating catheter inclusive of imaging guidance for vascular
embolization. Subsequently, we also created HCPCS code C8004
(Simulation angiogram with use of a pressure-generating catheter (e.g.,
one-way valve, intermittently occluding), inclusive of all radiological
supervision and interpretation, intraprocedural road mapping, and
imaging guidance necessary to complete the angiogram, for subsequent
therapeutic radioembolization of tumors) to describe the simulation
angiogram associated with the use of the pressure-generating catheter
described by HCPCS code C9797 for the April, 2025 OPPS Quarterly
Release. For CY 2026, HCPCS code C9797 is assigned to APC 5194 with a
payment rate of around $18,729 while HCPCS code C8004 is assigned to
APC 5193 with a payment rate of around $11,874. Currently both HCPCS
codes C9797 and C8004 are only payable in the OPPS and ASC settings, as
there is currently no coding for the physician office setting
describing use of this technology. Under the PFS, vascular embolization
procedures are reported using CPT code 37243 (Vascular embolization or
occlusion, inclusive of all radiological supervision and
interpretation, intraprocedural roadmapping, and imaging guidance
necessary to complete the intervention; for tumors, organ ischemia, or
infarction) regardless of the technology used to perform the service.
Interested parties have indicated that use of this technology has
expanded beyond the OPPS and ASC settings and into the physician office
setting; however, the resource costs associated with CPT code 37243 do
not accurately account for the use of innovative catheter technology.
While this technology may not yet be typical and as such is
appropriately absent from the valuation of CPT code 37342, we are
concerned that the lack of appropriate coding and payment for the use
of innovative catheter technology may negatively impact access in the
non-facility setting.
Beginning July 1, 2026, we began making separate payment for
vascular embolization or occlusion procedure with the use of a
pressure-generating catheter through the contractor priced HCPCS code
G0577 (Vascular embolization or occlusion procedure with use of a
pressure-generating catheter (e.g., one-way valve, intermittently
occluding), inclusive of all radiological supervision and
interpretation, intraprocedural roadmapping, and imaging guidance
necessary to complete the intervention; for tumors, organ ischemia, or
infarction performed in the non-facility setting) and are proposing to
nationally price this service for CY 2027. We are seeking comment on
whether there is a need for creation of a HCPCS G-code to mirror HCPCS
code C8004 as currently there are no claims for this service in the
HOPD setting.
In the CY 2026 PFS final rule, we finalized use of the relationship
between the OPPS APC relative weights for APCs describing radiation
treatment delivery services to inform the PE RVUs for those services
under the PFS. We believe a similar policy is necessary here to
establish the initial valuation for vascular embolization using a
pressure generating catheter given the lack of pricing information in
the non-facility setting. Therefore we are proposing to use the
relative relationship between the approximate APC payment amounts
between CPT code 37243 and HCPCS code C9797 to value the PE portion of
HCPCS code G0577 and a direct crosswalk to the work and MP RVUs
associated with CPT code 37243 as well as the physician time. We are
seeking comments on these values. We would also note that this
valuation is preliminary and we will consider updates for future
rulemaking if use of this technology becomes more widespread in the
non-facility setting.
(58) Accounting for E/M Resource Overlap Between Stand-Alone Visits and
Global Periods
(a) Background
Surgical procedures with a global surgery period include all the
necessary services normally provided by the practitioner before,
during, and after a procedure. The global surgery payment includes
things like pre-operative visits,
[[Page 43908]]
typical intra-operative services for that procedure, post-operative
follow-up visits, supplies, and other services such as dressing
changes, and removal of items used during or after surgery like
sutures, staples, splints, or casts.\48\ The payment and coding
structure of global surgery periods includes the same foundational
pieces as other codes in the PFS: work RVUs, practice expense RVUs, and
malpractice RVUs. The work RVUs include time crosswalked from E/M codes
to reflect the valuation of things such as pre-operative and post-
operative visits. Given that global surgical packages already account
for the resource costs associated with visits, standalone E/M codes are
not billable on the same day as a procedure code unless they are
significant and separately identifiable from the procedure. These
visits are identified through appending of modifier-25 to the claim.
This proposal is meant to address the likely overlap and duplication of
payment between the E/M services already paid for during the global
surgical package, and any additional E/M services billed for through
the use of modifier-25 as significant and separately identifiable.
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\48\ https://www.cms.gov/files/document/mln907166-global-surgery-booklet.pdf.
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The PFS has other existing policies where we reduce payments if
multiple procedures are furnished on the same day for the same patient,
the multiple procedure payment reduction (MPPR) policies. MPPR is a
longstanding Medicare policy to reduce payment by 50 percent for the
second and subsequent surgical procedures furnished on the same day to
the same patient, largely based on the efficiencies in PE and pre- and
post-surgical physician work. Since the implementation of the PFS, MPPR
policies were also established on nuclear medicine diagnostic
procedures, the professional and technical component of diagnostic
imaging, the technical component of diagnostic cardiovascular and
ophthalmology procedures, and always-therapy services. In the 2019 PFS
proposed rule (83 FR 35840 through 35841), as part of a suite of
proposals designed to modify the payment structure of E/M visits, we
proposed to reduce payment by 50 percent for the least expensive 0-day
global procedure or visit that the same physician (or a physician in
the same group practice) furnishes on the same day as a separately
identifiable E/M visit, currently identified on the claim by an
appended modifier-25.
In the 2019 PFS final rule (83 FR 59638 through 59640), many
commenters opposed this proposal, stating that current billing rules
allow these services to be billed only when modifier-25 is used, which
makes it clear that the visits are significant and separately
identifiable. Other commenters described that the RUC review process
includes adjustments to account for any costs that the RUC considers
duplicative, which means that CMS is making an unnecessary second
adjustment. Commenters also stated that CMS provided insufficient
rationale for a 50 percent payment reduction instead of other potential
adjustments. Some physician organizations and patient advocacy groups
also stated concerns that physicians might respond to financial
incentives to bring patients back for necessary visits on a different
day to avoid triggering the payment reduction. MedPAC, among others,
were supportive of the proposal, stating that when a standalone E/M
visit occurs on the same day as a procedure, there are efficiencies
such as pre-service and post-service clinician work and practice
expense, that are not currently accounted for in the system. Other
commenters suggested alternative reductions, such as a 5 percent or 25
percent reduction.
In our response to commenters in the CY 2019 final rule (83 FR
59638 through 59640), we stated that we continued to have concerns
about 0- and 10-day global periods on the same day as E/M visits. We
appreciated the efforts of the RUC to address overlaps when they
recognize that a code is often reported with a same day E/M visit, but
we also noted that the RUC tends to recommend only minor adjustments to
physician time and direct PE inputs to account for overlap. We also
discussed that there are several thousand codes with global periods,
and while we routinely prioritize review of high-volume services, we
believe code-level reviews are not a practical solution to ensuring the
accuracy of accounting for these types of efficiencies. We also stated
that if practitioners begin deliberately scheduling visits on separate
days to avoid the payment adjustment, this could create undue burden
and create potential medical risk for beneficiaries.
We did not finalize this proposal in CY 2019 for a few reasons.
First, we had concerns related to balancing the appropriate valuation
of these codes with potential disruption to patient care. We reiterated
that we find the possible practice of scheduling medical services to
maximize payment highly problematic, and we invited interested party
feedback regarding how to address these challenges. Second, we did not
finalize any of the suite of proposals related to the valuation of the
E/M code set in CY 2019, as the AMA and the CPT Editorial Panel stated
plans to revisit coding for O/O E/M, and we delayed further action to
allow that process to play out (83 FR 59638).
(b) Proposed Changes to Payments Using Modifier-25
As we stated in the CY 2019 final rule (83 FR 59638 through 59640),
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. We are proposing to reduce payment, as
described later in this section, when a separately identifiable O/O E/M
visit is furnished by the same physician (or a physician in the same
group practice) on the same day as a 0-, 10-, and 90-day global
procedure. Under this proposal, the most expensive service (either
surgical or E/M visit) would be paid at 100 percent, and all other
surgical procedure(s) or E/M visit(s) would be paid at 50 percent. For
example, a patient receives an O/O E/M visit using CPT code 99212
(Office or other outpatient visit for the evaluation and management of
an established patient, which requires a medically appropriate history
and/or examination and straightforward medical decision making. When
using total time on the date of the encounter for code section, 10
minutes must be met or exceeded.) at a dermatologist's office, and then
has two skin lesions removed, one using CPT code 11300 (Shaving of
epidermal or dermal lesion, single lesion, trunk, arms, or legs; lesion
diameter 0.5cm or less) and one using CPT code 11301 (Shaving of
epidermal or dermal lesion, single lesion, trunk, arms or legs; lesion
diameter 0.6 to 1.0 cm). Using 2026 RVU values, the total non-facility
(NF) RVU of CPT code 99212 is 1.78, the total NF RVU of CPT code 11300
is 2.89, and the total NF RVU of CPT code 11301 is 3.48. Since CPT code
11301 is the highest paid service, CPT code 11301 will be paid at 100
percent (total RVU of 3.48), and CPT code 11300 and the payment for CPT
code 99212 will both be reduced by 50 percent, CPT code 11300 down to
1.445 RVUs and CPT code 99212 down to 0.89 RVUs.
The 50 percent value aligns with our previous proposal from CY 2019
PFS proposed rule (83 FR 35840 through 35841) and matches the
longstanding surgical MPPR discussed previously in this section. We
welcome comments on
[[Page 43909]]
the value of this adjustment, including whether it would be more
appropriate to match a different MPPR value, such as 25 percent.
While we are proposing to apply this policy only to O/O E/M visits,
we are seeking comments on whether it should also apply to other E/M
visits, such as inpatient E/M visits.
We reiterate that we do not find it appropriate to schedule medical
services for patients to maximize payment, which would create undue
burden and potential medical risk for beneficiaries. We have a number
of data analysis tools to monitor for potentially problematic
utilization patterns which may be useful in future, if necessary, for
monitoring for this practice, including distinct claims editing to
identify problematic utilization patterns, comparative billing reports
to identify to providers their outlier status, and medical review
capabilities to determine if the patterns are problematic and
indicative of waste or abuse. We are also seeking comment on whether or
not it is necessary to revise the conditions of payment to mitigate
such payment abuses.
(c) Intravitreal Eye Injections
We are also seeking comment on how this policy might apply to an E/
M visit reported on the same day as intravitreal eye injection, such as
CPT code 67028, a high volume 000-day global code. In recent years,
since new injected medications were developed to treat retinal
diseases, there has been new focus from auditors (such as the OIG),
MACs, professional eye associations and the AMA, to better understand
the standard of care for patients receiving these treatments, in terms
of when same-day eye examinations are clinically indicated and
separately identifiable from the injection procedure, for the injected
eye or the fellow eye. We have heard that patients with retinal
diseases require examination every one to three months based on their
treatment response, and importantly, both eyes are examined at each
visit because of the high incidence of bilateral (though often
asynchronous) involvement. The associations have written to CMS outside
of the rulemaking process, indicating that around 50 percent of the
time, a separately reported E/M visit on the same day to examine the
eye(s) may be prompted or required by the symptom or condition for
which the injection is being provided. The fellow eye could require
examination if the patient reports symptoms in that eye when they
present for an injection, and same-day exams determine if the type of
medication is appropriate and the length of time between injections can
be extended. To help us ensure accurate payment, we are seeking to
better understand the clinical circumstances involved, and any overlap
with resources already accounted for in valuation of the global
procedure, such as for (1) established patients without symptoms in the
fellow eye; (2) established patients with symptoms in the fellow eye,
whether prior or newly reported upon presenting for their injection;
(3) new patients; (4) does it vary according to diagnosis and exam
findings; (5) are injections in the fellow eye always deferred to
another day; and (6) how CMS might be able to confirm or ensure that
the visit being reported is significant and separately identifiable
absent medical record review, for example, should we expect to see a
new or different diagnosis code on the claim.
We are also seeking to better understand whether the E/M work
associated with new patients is typically included in valuation of the
minor procedures, or whether there is extra work for new patients that
is significant and separately identifiable enough to always warrant
separate payment.
(59) Revisions To Teaching Physician Policy Related to the Primary Care
Exception
(a) Background
As a general matter, E/M visit codes under the PFS can only be
reported when the care is personally provided by a qualified
practitioner. Currently, under the primary care exception described at
Sec. 415.174, in the case of certain visit codes of lower and mid-
level complexity, Medicare contractors may be able to make PFS payment
for a service provided by a resident without the presence of a teaching
physician, but in specific outpatient primary care centers and when
certain conditions must be met. For example, the teaching physician
must direct the care from such proximity as to constitute immediate
availability (that is, to effectively provide direct supervision).
During the Public Health Emergency (PHE) for the 2019 Novel
Coronavirus (COVID-19) pandemic, CMS allowed through an interim final
rule (85 FR 19230 through 19292) that all levels of an O/O E/M service
provided in specified primary care centers may be provided under
supervision of the teaching physician by interactive telecommunications
technology (85 FR 19259). At the conclusion of the PHE this flexibility
expired, such that only lower and mid-level complexity visits (as
specified by CMS in program instructions) could be provided without the
presence of a teaching physician under the terms specified in Sec.
415.174.
Additionally, in the CY 2020 PFS final rule (84 FR 62851 through
62854), E/M visits were revised to allow visits to be based on time and
medical decision making. According to our claims data, we note that the
most commonly billed O/O E/M visit level is now a moderate level visit
(level 4), whereas in the past, a mid-level (level 3) visit was most
common.
(b) Revisions to Current Policy
We have received multiple requests from interested parties
requesting us to allow residents to perform moderate and high (level 4
and 5) E/M visits under the supervision of the teaching physician and
to defer to the clinical judgment of that graduate medical education
(GME) program as to whether or not these high level visits may be
performed without the presence of the teaching physician.
After consideration and evaluation of interested parties' requests,
we are proposing that all levels of an O/O E/M service provided in
primary care centers, and meeting the requirements in Sec. 415.174,
may be provided under direct supervision of the teaching physician in
such cases where the teaching physician believes such care is
clinically appropriate and without the presence of a teaching
physician. Specifically, we are proposing modifications to the
requirements at Sec. 415.174 Exception: Evaluation and management
services furnished in certain centers, to expand coverage of services
for teaching physicians as part of a graduate medical education (GME)
program. We are proposing to modify the requirements for certain E/M
codes to allow physician fee schedule payment for a service furnished
by a resident provided under direct supervision. We are proposing to
modify paragraph (a) to state that certain evaluation and management
codes (as specified by CMS in program instructions), may be paid by the
physician fee schedule and are thus proposing to remove the language
``of lower and mid-level complexity'' to potentially allow for certain
moderate and higher-level evaluation and management codes to be billed
if the visit meets all the criteria in Sec. 415.174. We are proposing
Sec. 415.174 (a) to read as follows: ``In the case of certain
evaluation and management codes (as specified by CMS in program
instructions), Medicare Administrative Contractors (MACs) may make
physician fee schedule payment for a service furnished by a resident
without the presence of a teaching physician.
[[Page 43910]]
For the exception to apply, all of the following conditions must be
met.''
We believe this proposal would provide some autonomy to residents
as well as the teaching physician if the specific GME program would
support it. We considered that some visits may take more time in the
beginning since residents are still learning and we will continue to
monitor the visit levels over time. We welcome comments on this
proposal.
(60) Bundled Payments Under the PFS for Substance Use Disorders (HCPCS
Codes G2086, G2087, and G2088)
In the CY 2020 PFS final rule (84 FR 62673), we finalized the
creation of new coding and payment describing a bundled episode of care
for the treatment of Opioid Use Disorder (OUD). Then, in the CY 2021
PFS final rule, we finalized a revision to the code descriptors for
HCPCS codes G2086, G2087, and G2088 by replacing ``opioid use
disorder'' with ``a substance use disorder'' in response to requests to
expand these bundled payments to be inclusive of other substance use
disorders (SUDs), not just OUD, stating we agreed that doing so could
expand access to needed care.
The codes are:
HCPCS code G2086: Office-based treatment for a substance
use disorder, including development of the treatment plan, care
coordination, individual therapy and group therapy and counseling; at
least 70 minutes in the first calendar month.
HCPCS code G2087: Office-based treatment for a substance
use disorder, including care coordination, individual therapy and group
therapy and counseling; at least 60 minutes in a subsequent calendar
month.
HCPCS code G2088: Office-based treatment for a substance
use disorder, including care coordination, individual therapy and group
therapy and counseling; each additional 30 minutes beyond the first 120
minutes (List separately in addition to code for primary procedure).
Interested parties have pointed out disparities in payment for
HCPCS codes G2086 through G2088 compared to payment for similar
services under the Medicare Opioid Treatment Program (OTP) benefit.
They state that both OTPs and non-OTP outpatient addiction treatment
settings can provide American Society of Addiction Medicine ASAM Level
1.7's suite of services that include medically managed outpatient
treatment services, including evaluation and management of
intoxication, withdrawal, biomedical concerns, and common low
complexity psychiatric concerns. They state that the only clinical
difference between these places of service at ASAM Level 1.7 is that
OTPs can provide methadone for the treatment of OUD, and the other
cannot due to Federal regulations. OTPs are also governed by extensive
Federal and State regulations, unlike office-based practices which are
not federally regulated settings but may be subject to extensive State
regulations. They note that since the time these codes were created,
there is now a new Level 1.0 that describes remission monitoring
services or services to patients in stable remission, similar to
services described by outpatient E/M codes. The new Level 1.5 provides
outpatient counseling and psychotherapeutic services, appropriate for
patients with mild SUDs and those in early remission, and a new Level
1.7 that describes medically-managed outpatient treatment, including
withdrawal management. They state that the services described by HCPCS
codes G2086-G2088 align with Level 1.5, but that there is no existing
coding under the PFS to describe level 1.7.
We welcome additional information on this topic, including whether
we should consider updates to the rates for HCPCS codes G2086 through
G2088, and/or whether additional coding is needed to describe the ASAM
1.7 level of care.
(61) Software as a Medical Service (SaMS) Laboratory Analyses
In recent years, there have been rapid developments in the use of
software-based technologies with novel functionalities, including
artificial intelligence, to support clinical decision-making in the
outpatient and physician office settings. New clinical software, which
includes clinical decision support software, clinical risk modeling,
and computer aided detection (CAD), is becoming increasingly available
to practitioners. These technologies often perform data analysis of
diagnostic images from patients, relying on complex algorithms or
statistical predictive modeling to aid in the diagnosis or treatment
planning of a patient's condition. In previous rulemaking, we have
referred to these algorithm-driven services that assist practitioners
in making clinical assessments or diagnoses as Software as a Service
(SaaS). Some of the software functions that are used in these services
are FDA-regulated medical devices. Unlike prescription digital
therapeutics (PDTs), for example PDTs that provide cognitive behavioral
therapy to treat substance disorders or chronic insomnia, SaaS
technologies do not currently treat illnesses or patient injuries. SaaS
is also separate from remote patient monitoring (RPM) and remote
therapeutic monitoring (RTM), which are digital healthcare tools for
tracking patient data outside traditional office settings (90 FR
49394). For CY 2027, we propose a change in terminology. We now
understand that in other industries, the existing SaaS terminology is
used for general cloud-based computing service models outside of a
health care context, which may cause confusion as we are using it to
describe specific services that provide a medical function for purposes
of PFS Medicare payment policy. To dispel any ambiguity and clarify
that distinction, we propose to change our terminology from SaaS to
Software as a Medical Service (SaMS) to refer to software-based
technologies that support clinical decision making through algorithmic
analysis, including those that provide clinical or diagnostic
functionality. We welcome public comments on the proposed change in
terminology. For further discussion of this terminology and other OPPS
SaMS proposals, please see the CY 2027 Hospital Outpatient Prospective
Payment System (OPPS) and Ambulatory Surgical Center (ASC) Proposed
Rule (91 FR 41918).
In recent years, we have seen an increase in laboratory tests that
combine laboratory analyses, such as genomic sequencing or
immunoassays, with computer algorithms to produce a clinical test
result. The AMA CPT Editorial Panel created a category called Multi-
Analyte Assays with Algorithmic Analysis, to categorize test codes that
combined laboratory analyses with computer algorithms to generate
clinical information. More recently, however, we are seeing the
development of distinct algorithmic analyses alone.
For example, when the genomic sequencing of an individual is
performed, this sequencing will likely only need to be performed once.
However, once the genomic sequence has been generated, the subsequent
algorithmic analyses of that sequence data can be performed an infinite
number of times to produce a wide range of results and/or diagnostic or
risk-related information. These secondary analyses of original genomic
sequences can be proprietary and unique to a single laboratory but
could also be conducted at a range of settings. For purposes of this
proposal, we are referring to subsequent stand-alone algorithmic
analyses that are separate from a CLIA certified laboratory's
examination of human material, as defined by 42 CFR 493.2, as ``SaMS
laboratory analyses performed on laboratory tests''.
[[Page 43911]]
Currently, certain SaMS analyses performed on laboratory tests are
treated as clinical diagnostic laboratory tests (CDLTs) and paid under
the Clinical Laboratory Fee Schedule (CLFS). Section 1861(s) of the Act
specifies items and services included as ``medical and other health
services'' under Part B, including diagnostic X-ray tests, diagnostic
laboratory tests, and other diagnostic tests as described in section
1861(s)(3) of the Act. Section 1861(s)(17) of the Act states that no
diagnostic tests performed in any laboratory shall be included within
paragraph (3) unless such laboratory meets CLIA certification
requirements under section 353 of the Public Health Service Act, among
other requirements. Sections 1833(h) and 1834A of the Act and the
implementing regulations at 42 CFR part 414, subpart G, set forth the
CLFS ratesetting methodologies for CDLTs. We do not believe it is
appropriate to consider these secondary algorithmic analyses to be
CDLTs or establish CLFS payment rates for these analyses because these
secondary algorithmic analyses do not require laboratory services or
entities, regulated by CLIA, to perform them. Referring to the example
above, while an individual's genomic sequence must be performed by a
CLIA certified laboratory entity to allow for Medicare payment under
the CLFS, the subsequent algorithmic analyses of the sequence data as
part of the SaMS analyses performed on laboratory tests can be
performed by any non-regulated entity with the computer software needed
to perform the analyses.
Our position is that the secondary analyses are ``other diagnostic
tests'' under section 1861(s)(3) of the Act as opposed to ``diagnostic
laboratory tests.'' As noted previously, Medicare will not pay for
CDLTs on the CLFS unless they are furnished by laboratories that meet
applicable CLIA certification requirements.
Tests that examine materials derived from the human body are
assigned to and paid under the CLFS only when furnished by such
certified laboratories, in accordance with 42 CFR 410.32(d). Because
SaMS analyses performed on laboratory tests are downstream evaluations
of the data generated by a prior laboratory test, an entity that
performs only algorithmic analyses of previously sequenced data may not
qualify as a CLFS laboratory under 42 CFR 493.2 or require CLIA
certification. We believe SaMS that evaluate data generated by a prior
laboratory test should not be treated as CDLTs for Medicare payment
purposes.
We are also concerned that paying for these analyses based on
existing CLFS payment methodologies may create significant
vulnerabilities for the Medicare program, due to the lack of data
transparency and CDLTs not being subject to beneficiary cost-sharing or
budget neutrality. Section 414.508 outlines the ratesetting
methodologies CMS uses to set payment rates for new tests on the CLFS.
Under Sec. 414.508(b), CMS determines the payment amount based on
either crosswalking or gapfilling methodologies until applicable
information is available to establish a payment amount under the
methodology described in Sec. 414.507(b). Crosswalking is used if it
is determined that a new CDLT is comparable to an existing test,
multiple existing test codes, or a portion of an existing test code.
Gapfilling is used when no comparable existing CDLT is available.
Public consultation for payment for new clinical diagnostic laboratory
tests is required in determining payment amounts, receiving public
comments and recommendations (and data on which the recommendations are
based) as well as recommendations from the Advisory Panel on CDLTs per
42 CFR 414.506.
A significant challenge to the ratesetting process for CMS is the
lack of transparent data received from laboratories outlining resource
costs of a test, particularly for the algorithmic portions of tests
that are combined with other analytes. In the past, laboratories have
explained to CMS that the algorithmic components of laboratory tests
are highly proprietary and details cannot be shared. Thus, we have
worked with the limited information available on the details of methods
or resources for the algorithmic portions of tests or analyses and has
thus far relied on the other laboratory methods provided in the CPT
descriptor (i.e., NGS sequencing, RT-PCR, or DNA methylation analysis).
As we have gathered more information on SaMS analyses performed on
laboratory tests, we now believe that since these analyses are entirely
computer-based, comparison based on laboratory methodologies is not
appropriate. Additionally, in contrast to the PFS, the CLFS generally
does not include beneficiary cost-sharing or budget neutrality
adjustments, which limits transparency regarding pricing and creates
challenges for ensuring appropriate valuation of these services.
Finally, CMS has an interest in ensuring that services that are
fundamentally similar are paid for and treated in the same way,
regardless of the setting of care in which the service is furnished.
Since SaMS analyses performed on laboratory tests do not require
performance by a CLIA-certified laboratory and perform algorithmic
analyses on previously generated data, we believe SaMS analyses
performed on laboratory tests are substantively similar to other SaMS
technologies that are currently paid under the PFS. Accordingly, we
believe that whether the SaMS performs algorithmic analyses of an
imaging test (e.g., CT scan) or whether it performs an algorithmic
analysis on data generated from a laboratory test, all algorithmic
analyses should be treated consistently with other comparable SaMS
analyses and belong within the broader proposed framework for SaMS. We
believe that this approach for SaMS technologies would promote
stability and predictability in payment for similar services.
Therefore, for CY 2027, we are proposing to contractor price ten
HCPCS codes describing various SaMS analysis performed on laboratory
tests under the PFS. Table A-D8 shows the list of currently payable
SaMS analysis performed on laboratory tests under the CLFS that we are
proposing to contractor price under the PFS. These ten HCPCS codes were
identified by the CPT descriptor for the code. If there were no
laboratory methods included in the code descriptor, and only a computer
analysis was described, we identified the code as a SaMS analysis
performed on laboratory tests. We refer to the 2027 Hospital Outpatient
Prospective Payment System (OPPS) and Ambulatory Surgical Center (ASC)
Proposed Rule (91 FR 41918) for discussion of payment for these
services under the OPPS, where we are proposing to assign the same SaMS
analysis performed on laboratory tests to new technology APCs.
We would appreciate public comment on any other SaMS analysis
performed on laboratory tests that should be removed from the CLFS and
contractor priced under the PFS. We are seeking comment more broadly on
other approaches to payment for these services, including, but not
limited to, a direct crosswalk to the proposed OPPS new technology APC
dollar amounts for all proposed analyses, a subset of these analyses,
or specific analyses as opposed to contractor pricing.
In addition, for CY 2027 and subsequent years, we propose to assign
any new codes that describe SaMS analysis performed on laboratory
testto contractor pricing for payment under the PFS. We request public
comment on these proposals, including the list of ten HCPCS codes that
we identified as
[[Page 43912]]
SaMS analysis performed on laboratory tests, as well as any additional
HCPCS codes that we should designate as SaMS analysis performed on
laboratory tests and pay under the PFS rather than as CDLTS paid on the
CLFS. We may finalize a policy that includes such payment for
additional HCPCS codes in the PFS final rule based on public comment.
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(62) Caregiver Training Services (CTS)
In the CY 2025 PFS final rule (89 FR 97817 through 97821), we
finalized new G-codes and payment for direct care CTS: HCPCS codes
G0541 (Caregiver training in direct care strategies and techniques to
support care for patients with an ongoing condition or illness and to
reduce complications (including, but not limited to, techniques to
prevent decubitus ulcer formation, wound care, and infection control)
(without the patient present), face-to-face; initial 30 minutes), G0542
(Caregiver training in direct care strategies and techniques to support
care for patients with an ongoing condition or illness and to reduce
complications (including, but not limited to, techniques to prevent
decubitus ulcer formation, wound care, and infection control) (without
the patient present), face-to-face; each additional 15 minutes (list
separately in addition to code for primary service) (use g0542 in
conjunction with g0541)), and G0543 (Group caregiver training in direct
care strategies and techniques to support care for patients with an
ongoing condition or illness and to reduce complications (including,
but not limited to, techniques to prevent decubitus ulcer formation,
wound care, and infection control) (without the patient present), face-
to-face with multiple sets of caregivers).
We are seeking comment on whether the resource costs associated
with these services are best reflected through this existing coding or
whether these resources costs are reflected in the valuation of other
codes paid under the PFS, such as E/M visits.
(63) Comment Solicitation on Payment for Physician-Patient Clinical
Trial Discussions
Despite the U.S. investing over $50 billion annually in biomedical
research, fewer than 7 percent of adult cancer patients enroll in
clinical trials.\49\ A central and modifiable reason is that physicians
rarely initiate conversations about clinical trials with their
patients. For example, national survey data show that 70 percent of
oncologists discuss trials with less than a quarter of their
patients,\50\ yet more than 50 percent of eligible patients enroll when
actively offered a clinical trial.\51\
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\49\ Unger JM, Shulman LN, Facktor MA, Helson H, Fleury ME.
National estimates of the participation of patients with cancer in
clinical research studies based on commission on cancer
accreditation data. J Clin Oncol. 2024;42:2139-2148.
\50\ Lee SJC, Murphy CC, Gerber DE, et al. Reimbursement
matters: overcoming barriers to clinical trial accrual. Med Care.
2021;59(5):461-466. PMC8026490.
\51\ Unger JM, Vaidya R, Hershman DL, Minasian LM, Fleury ME.
Systematic review and meta-analysis of the magnitude of structural,
clinical, and physician and patient barriers to cancer clinical
trial participation. J Natl Cancer Inst. 2019;111(3):245-255.
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Time and administrative burden are documented as the top barrier to
conversations between physician and
[[Page 43913]]
patients about participation in clinical trials in virtually every
survey.\52\ The current valuation of existing visit codes does not
account for the additional time and resource costs associated with the
structured physician counseling regarding clinical trial eligibility,
options, risks and benefits associated with counseling a beneficiary on
whether to enroll in a clinical trial.
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\52\ Kumar A, Bhatt DL, Fonarow GC, et al. Barriers for cancer
clinical trial enrollment: a qualitative study of the perspectives
of healthcare providers. Contemp Clin Trials Commun. 2022;28:100939.
PMC9189774.
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We are therefore seeking comment on whether we should effectuate
payment for these resource costs through the creation of a HCPCS G-code
describing a minimum of 20 minutes of physician or other QHP time spent
on clinical trial counseling. We are seeking comment on accurate
valuation for this service, including inputs for work and practice
expense, and whether the service should be available as a Medicare
telehealth service. Interested parties suggested a work RVU value
between 1.00 and 1.50 RVUs would accurately account for the physician
work associated with this service. We are also seeking comment on what
documentation requirements we might consider for such a service, such
as the trial(s) discussed and the patient's decision.
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BILLING CODE 4169-69-C
4. Potentially Misvalued Services Under the PFS
a. Background
Section 1848(c)(2)(B) of the Act directs the Secretary to conduct a
periodic review, not less often than every 5 years, of the relative
value units (RVUs) established under the PFS. Section 1848(c)(2)(K) of
the Act requires the Secretary to periodically identify potentially
misvalued services using certain criteria and to review and make
appropriate adjustments to the relative values for those services.
Section 1848(c)(2)(L) of the Act also requires the Secretary to develop
a process to validate the RVUs of certain potentially misvalued codes
(PMVC) under the PFS, using the same criteria used to identify PMVC,
and to make appropriate adjustments.
As outlined in section II.D. of the proposed rule, under Valuation
of Specific Codes, each year we develop appropriate adjustments to the
RVUs taking into account recommendations provided by the American
Medical Association (AMA)/Specialty Society Relative Value Scale (RVS)
Update Committee (referred to as the RUC), MedPAC, and other interested
parties. For many years, the RUC has provided us with recommendations
on the appropriate relative values for new, revised, and potentially
misvalued PFS services. We review these recommendations on a code-by-
code basis and consider these recommendations in conjunction with
analyses of other data, such as claims data, to inform the decision-
making process as authorized by statute. We may also consider analyses
of work time, work RVUs, or direct practice expense (PE) inputs using
other data sources, such as the Veterans Health Administration (VHA),
National Surgical Quality Improvement Program (NSQIP), the Society for
Thoracic Surgeons (STS), and the Merit-based Incentive Payment System
(MIPS) data. In addition to considering the most recent available data,
we assessed the results of physician surveys and specialty
recommendations submitted to us by the RUC for our review. We also
consider information provided by other interested parties such as from
the general medical-related community and the public. We conduct a
review to assess the appropriate RVUs in the context of contemporary
medical practice. We note that section 1848(c)(2)(A)(ii) of the Act
authorizes the use of extrapolation and other techniques to determine
the RVUs for physicians' services for which specific data are not
available and requires us to take into account the results of
consultations with organizations representing physicians who provide
the services. In accordance with section 1848(c) of the Act, we
determine and make appropriate adjustments to the RVUs.
In its March 2006 Report to the Congress (https://www.medpac.gov/document/report-to-the-congress-2006-medicare-payment-policy/), MedPAC
discussed the importance of appropriately valuing physicians' services,
stating that misvalued services can distort the market for physicians'
services, as well as for other health care services that physicians
order, such as hospital services. In that same report, MedPAC
postulated that physicians' services under the PFS can become misvalued
over time. MedPAC stated, ``When a new service is added to the
physician fee schedule, it may be assigned a relatively high value
because of the time, technical skill, and psychological stress that are
often required to furnish that service. Over time, the work required
for certain services would be expected to decline as physicians become
more familiar with the service and more efficient in furnishing it.''
We believe services can also become overvalued when PE costs decline.
This can happen when the costs of equipment and supplies fall, or when
equipment is used more frequently than is estimated in the PE
methodology, reducing its cost per use. Likewise, services can become
undervalued when physician work increases, or PE costs rise.
[[Page 43930]]
As MedPAC noted in its March 2009 Report to Congress (https://www.medpac.gov/docs/default-source/reports/march-2009-report-to-congress-medicare-payment-policy.pdf), in the intervening years since
MedPAC made the initial recommendations, CMS and the RUC have taken
several steps to improve the review process. Also, section
1848(c)(2)(K)(ii) of the Act augments our efforts by directing the
Secretary to specifically examine, as determined appropriate,
potentially misvalued services in the following categories:
Codes that have experienced the fastest growth.
Codes that have experienced substantial changes in PE.
Codes that describe new technologies or services within an
appropriate time-period (such as 3 years) after the relative values are
initially established for such codes.
Codes which are multiple codes that are frequently billed
in conjunction with furnishing a single service.
Codes with low relative values, particularly those that
are often billed multiple times for a single treatment.
Codes that have not been subject to review since
implementation of the fee schedule.
Codes that account for the majority of spending under the
PFS.
Codes for services that have experienced a substantial
change in the hospital length of stay or procedure time.
Codes for which there may be a change in the typical site
of service since the code was last valued.
Codes for which there is a significant difference in
payment for the same service between different sites of service.
Codes for which there may be anomalies in relative values
within a family of codes.
Codes for services where there may be efficiencies when a
service is furnished at the same time as other services.
Codes with high intraservice work per unit of time.
Codes with high PE RVUs.
Codes with high-cost supplies.
Codes as determined appropriate by the Secretary.
Section 1848(c)(2)(K)(iii) of the Act also specifies that the
Secretary may use existing processes to receive recommendations on the
review and appropriate adjustment of potentially misvalued services. In
addition, the Secretary may conduct surveys, other data collection
activities, studies, or other analyses, as the Secretary determines to
be appropriate, to facilitate the review and appropriate adjustment of
potentially misvalued services. This section also authorizes the use of
analytic contractors to identify and analyze potentially misvalued
codes, conduct surveys or collect data, and make recommendations on the
review and appropriate adjustment of potentially misvalued services.
Additionally, this section provides that the Secretary may coordinate
the review and adjustment of any RVU with the periodic review described
in section 1848(c)(2)(B) of the Act. Section 1848(c)(2)(K)(iii)(V) of
the Act specifies that the Secretary may make appropriate coding
revisions (including using current processes for consideration of
coding changes), which may involve consolidating individual services
into bundled codes for payment under the PFS.
b. CY 2027 Identification and Review of Potentially Misvalued Services
In the CY 2012 PFS final rule with comment period (76 FR 73058
through 73059), we finalized a process for the public to nominate PMVC.
In the CY 2015 PFS final rule with comment period (79 FR 67606 through
67608), we modified this process whereby the public and interested
parties may nominate PMVC for review by submitting the code with
supporting documentation by February 10th of each year. Supporting
documentation for codes nominated for the annual review of PMVC may
include the following:
Documentation in peer reviewed medical literature or other
reliable data that demonstrate changes in physician work due to one or
more of the following: technique, knowledge and technology, patient
population, site-of-service, length of hospital stay and work time.
An anomalous relationship between the code being proposed
for review and other codes.
Evidence that technology has changed physician work.
Analysis of other data on time and effort measures, such
as operating room logs or national and other representative databases.
Evidence that incorrect assumptions were made in the
previous valuation of the service, such as a misleading vignette,
survey, or flawed crosswalk assumptions in a previous evaluation.
Prices for certain high-cost supplies or other direct PE
inputs that are used to determine PE RVUs are inaccurate and do not
reflect current information.
Analyses of work time, work RVU, or direct PE inputs using
other data sources (for example, VA, NSQIP, the STS National Database,
and the MIPS data).
National surveys of work time and intensity from
professional and management societies and organizations, such as
hospital associations.
We evaluate the supporting documentation submitted with the
nominated codes and assess whether the nominated codes appear to be
PMVC appropriate for review under the annual process. In the following
year's PFS proposed rule, we publish the list of nominated codes and
indicate for each nominated code whether we agree with its inclusion as
a PMVC. The public has the opportunity to comment on these and all
other proposed PMVC. In each year's final rule, we finalize our list of
PMVC.
In each proposed rule, we seek nominations from the public and from
interested parties of codes that they believe we should consider as
potentially misvalued. We receive public nominations for PMVC by
February 10th and we display these nominations on our public website
(https://www.cms.gov/medicare/payment/fee-schedules/physician/federal-regulation-notices), where we include the submitter's name, their
associated organization and the submitted studies for full
transparency. We sometimes receive submissions for specific PE-related
inputs for codes, and discuss these PE-related submissions, as
necessary under the Determination of PE RVUs section of the rule. We
summarize later in this section this year's submissions under the PMVC
initiative. For CY 2027, we received 15 requests concerning various
codes as PMVC.
The nominations are as follows:
(1) Nasal Sinus Irrigation (CPT Codes 31000 and 31002)
We received a request from one nominator to review nasal sinus
irrigation codes, CPT 31000 (Lavage by cannulation; maxillary sinus
(antrum puncture or natural ostium)), and CPT 31002 (Lavage by
cannulation; sphenoid sinus), as potentially misvalued. We reviewed
this code family for the CY 2026 PFS final rule and our extensive
discussion and rationale for finalizing the current values can be found
at 90 FR 49310 through 49311.
We appreciate the information we received from the nominator.
However, we note the information was the same as last year's
submission. Additionally, the aforementioned CY 2026 PFS final rule
specifically mentions for nasal sinus irrigation that interested
parties were encouraged to submit relevant
[[Page 43931]]
documentation, such as invoices or other evidence that demonstrates the
typical resource costs for providing these services (90 FR 49311).
However, we did not receive any invoices from the nominator.
In consideration of the information provided in this potentially
misvalued nomination request as well as our previous valuation review
and decision stated in the CY 2026 PFS final rule, we are seeking
comments on the typicality and usage of the nasal sinus irrigation
codes, CPT codes 31000 and 31002.
(2) Urethral Bulking Material (CPT Code 51715)
We received a request from a nominator to review CPT code 51715
(Endoscopic injection of implant material into the submucosal tissues
of the urethra and/or bladder neck) as potentially misvalued. The
nominator stated that CPT code 51715 currently does not include a
supply for the implant material necessary to properly perform CPT code
51715 in the office setting, which is a clinically desired place of
service for this treatment. The nominator requested that CMS create a
supply code for a urethral bulking agent sold in 2 mL vials, with a
non-facility quantity of 1 priced at an average of $1,175 and
incorporate this new supply into CPT code 51715 to appropriately value
the service in the non-facility setting.
We appreciate the nominator submitting invoices regarding the
pricing of this urethral bulking agent. Given the information provided
by the nominator as well as factoring in the amount of time that has
passed since CPT code 51715 was last formally reviewed in the 1990s, we
are proposing to create a new supply code (SD396) for this urethral
bulking agent. The SD396 supply is based on a 2 mL vial which we are
proposing to price at the requested $1,175 based on an average of the
submitted invoices. We are proposing to add 1 quantity of this supply
to CPT code 51715 in the non-facility setting to reflect current
clinical practice. Given the cost of this supply and the length of time
since last review, we are also seeking comment on whether CPT code
51715 should be referred to the RUC for review.
(3) Complex Cystometrogram (CPT Codes 51728 and 51729)
We received a request from a nominator to review CPT code 51728
(Complex cystometrogram (i.e., calibrated electronic equipment); with
voiding pressure studies (ie, bladder voiding pressure), any technique)
and CPT code 51729 (Complex cystometrogram (i.e., calibrated electronic
equipment); with voiding pressure studies (ie, bladder voiding
pressure) and urethral pressure profile studies (ie, urethral closure
pressure profile), any technique). The nominator submitted invoices to
request a pricing increase in the supply codes SD017 (catheter
balloon), SD027 (catheter pressure), and SD131 (tubing pressure) for
CPT codes 51728 and 51729. The invoices submitted from the requestor
are dated from January 2025 to October 2025 and the nominator
specifically is requesting an increase in the price of the SD017 supply
from $35.89 to $74.00, an increase in the price of the SD027 supply
from $19.35 to $86.80, and an increase in the price of the SD131 supply
from $2.90 to $25.48.
We appreciate the information submitted from the nominator and note
we previously reviewed these supply codes in the CY 2026 PFS final rule
and stated, ``Given the differences between the names of the items in
question, and the significant increases in requested pricing, we
proposed not to update the pricing of these three supplies as we cannot
verify that the invoices refer to the same supply items.'' (90 FR
49279) Taking into consideration the invoice for the SD017 supply
listed a ``Abdominal Sensor Catheter'', the invoice for the SD027
supply listed a ``Single Sensor Catheter'', and the invoice for the
SD131 supply listed a ``Tubing, Pump, Infusion Line'' our rationale
that we cannot verify the names of items in question remains the same.
Therefore, based on a lack of additional information submitted to
explain the differences in names of the supply codes in question, we
are not proposing to update the pricing of these three supplies as we
are still unable to verify that these invoices refer to the same supply
items.
(4) Carpal Tunnel Release Procedure (CPT Code 64728)
We received a request from one nominator to review CPT code 64728
(Decompression; median nerve at the carpal tunnel, percutaneous, with
intracarpal tunnel balloon dilation, including ultrasound guidance) as
potentially misvalued. The nominator stated that this code is misvalued
due to the following reasons: (1) the anomalous relationship between
the valuation for CPT code 64728 and other CPT codes for carpal tunnel
release procedures; (2) Incorrect assumptions were made based on the
previous valuation of the service, including a misleading survey and
flawed crosswalk assumptions; and (3) Analysis of work relative value
units (RVUs) from reliable data sources support increased valuation.
The nominator requested an increase in work RVUs to appropriately
reflect the intensive work associated with this procedure.
This code family was reviewed in the CY 2026 PFS final rule and our
extensive discussion for finalizing a work RVU of 2.70 can be found in
90 FR 49374 through 49376. We previously addressed the concerns of the
nominator in this preamble and we have received no new data for CY 2027
which would support a higher valuation for CPT code 64728. Based on the
lack of new information submitted for CY 2027, we do not believe this
code to be potentially misvalued. We are seeking comment on this issue,
including the submission of new information to support the request.
(5) Electronic Analysis of Implanted Neurostimulator Pulse Generator/
Transmitter (CPT Codes 95970, 95976, 95977)
We received a request from one nominator to review CPT codes 95970
(Electronic analysis of implanted neurostimulator pulse generator/
transmitter (e.g., contact group[s], interleaving, amplitude, pulse
width, frequency [Hz], on/off cycling, burst, magnet mode, dose
lockout, patient selectable parameters, responsive neurostimulation,
detection algorithms, closed loop parameters, and passive parameters)
by physician or other qualified health care professional; with brain,
cranial nerve, spinal cord, peripheral nerve, or sacral nerve,
neurostimulator pulse generator/transmitter, without programming),
95976 (Electronic analysis of implanted neurostimulator pulse
generator/transmitter (e.g., contact group[s], interleaving, amplitude,
pulse width, frequency [Hz], on/off cycling, burst, magnet mode, dose
lockout, patient selectable parameters, responsive neurostimulation,
detection algorithms, closed loop parameters, and passive parameters)
by physician or other qualified health care professional; with simple
cranial nerve neurostimulator pulse generator/transmitter programming
by physician or other qualified health care professional), and 95977
(Electronic analysis of implanted neurostimulator pulse generator/
transmitter (e.g., contact group[s], interleaving, amplitude, pulse
width, frequency [Hz], on/off cycling, burst, magnet mode, dose
lockout, patient selectable parameters, responsive neurostimulation,
detection algorithms, closed loop parameters, and passive parameters)
by physician or other qualified health care professional; with
[[Page 43932]]
complex cranial nerve neurostimulator pulse generator/transmitter
programming by physician or other qualified health care professional).
The nominator stated they believe this code family is potentially
misvalued due to differing valuations relative to the recently reviewed
CPT codes 93150 (Therapy activation of implanted phrenic nerve
stimulator system, including all interrogation and programming), 93151
(Interrogation and programming (minimum one parameter) of implanted
phrenic nerve stimulator system), and 93153 (Interrogation without
programming of implanted phrenic nerve stimulator system), despite
being clinical similar services. The nominator also believed there were
discrepancies in equipment used to perform each procedure as opposed to
what is included in the current valuation due to inaccurate assumptions
about what clinical specialties most commonly furnish these procedures.
To support their requests, the nominator shared 2024 utilization data
showing an increase in certain clinical specialties furnishing these
services. We appreciate the additional information and are seeking
comment on the appropriate valuation of this code family as well as any
additional information on the typical specialty and resource costs
associated with furnishing these procedures.
(6) Scalp Cooling (CPT Code 97007, 97008, 97009)
We received a request from one nominator to review the mechanical
scalp cooling family of services described by CPT codes 97007
(mechanical Scalp cooling, including individual cap supply with head
measurement, fitting, and patient education), 97008 (mechanical scalp
cooling; including hair preparation, individual cap placement, therapy
initiation, and pre-cooling period), and 97009 (mechanical scalp
cooling; each 30 minutes), as potentially misvalued. We reviewed this
code family for the CY 2026 PFS final rule and our extensive discussion
and rationale for finalizing the current values can be found at 90 FR
49405 through 49406.
The nominator stated that they believe this code family may be
potentially misvalued based on newly available empirical evidence (a
Time and Motion Study) that demonstrates incorrect assumptions were
made during our prior valuation decision for the CY 2026 PFS final
rule. They reference in their nomination that the August 2024 Time and
Motion Study demonstrated that the clinical staff and PE inputs
required to furnish this service are materially greater than those
reflected in the current valuation and were not made available to CMS
prior to our valuation review and decision for CY 2026. Specifically,
the nominator recommended an increase in PE clinical staff time to 103
minutes for CPT code 97007, 52 minutes for 97008, and 23 minutes for
97009.
We appreciate the information we received from the nominator.
However, we disagree with their assertion that CMS did not have the
results of the August 2024 Time and Motion Study when making our
valuation decision for CY 2026. The aforementioned CY 2026 PFS final
rule discussion outlines the information considered for the valuation
decision and specifically mentions the August 2024 Time and Motion
Study results as well as the public comments received for the CY 2026
PFS proposed rule, which reflect the requested increase in PE clinical
staff time. We assure the nominators and readers of this discussion
that all the information provided in this potentially misvalued
nomination request was considered when making our previous valuation
review and decision for CY 2026. Accordingly, we disagree with the
assertion that this family is misvalued. However, we are seeking
comment, particularly updated information that could support a change
in valuation for these services.
(7) Hyperbaric Oxygen Under Pressure (HCPCS Code G0277)
The RUC has requested the deletion of HCPCS code G0277 (Hyperbaric
oxygen under pressure, full body chamber, per 30-minute interval), and
recommended that CPT code 99183 be revised to be time-based as well to
appropriately describe the treatment delivery, attendance and
supervision. The RUC concluded that maintaining a separate G-code
creates unnecessary coding complexity without adding clinical or
administrative value and that one clear and consistent coding structure
should exist for this service.
In 2015, CMS created HCPCS code G0277 to describe direct practice
expense inputs associated with CPT code 99183 (Physician or other
qualified health care professional attendance and supervision of
hyperbaric oxygen therapy, per session). We noted that under the
Outpatient Prospective Payment System (OPPS), the treatment used to be
reported using separate treatment code C1300 (Hyperbaric oxygen under
pressure, full body chamber, per 30-minute interval.) Therefore, we
created HCPCS code G0277 to report the treatment delivery and to
maintain consistency with the OPPS coding and PFS payment systems.
HCPCS code G0277 was identified as a high-volume growth code that
has Medicare utilization of 10,000 or more. High utilization of this
magnitude reflects that the code has been broadly adopted across
multiple care settings and underscores its operational importance
within the Medicare program. Deleting or replacing a high-volume code
without an equivalent can disrupt billing practices, create reporting
gaps, and impose unnecessary administrative burden on providers who
have integrated it into their standard practice. As such, we believe
there is a reason to continue to maintain the use of the G-code for
hyperbaric oxygen therapy since HCPCS code G0277 is utilized in
multiple Medicare payment systems to report the time the patient uses
the hyperbaric oxygen therapy. Accordingly, we are proposing to
maintain HCPCS code G0277.
(8) Image-Guided Robotic Linear Accelerator Stereotactic Radiosurgery
(HCPCS Code G0339 and G0340)
Image-guided robotic linear accelerator-based stereotactic
radiosurgery services are currently reported by and paid for using
HCPCS G-codes established the in CY 2007 PFS final rule HCPCS codes
G0339 (Image-guided robotic linear accelerator-based stereotactic
radiosurgery, complete course of therapy in one session or first
session of fractionated treatment) and G0340 (Image-guided robotic
linear accelerator-based stereotactic radiosurgery, delivery including
collimator changes and custom plugging, fractionated treatment, all
lesions, per session, second through fifth sessions, maximum five
sessions per course of treatment). In April 2025, the RAW identified
HCPCS code G0340 with 2023 Medicare utilization over 10,000 and
Medicare status of ``C'' contractor priced. The Workgroup requested an
action plan for G0340 for September 2025. In September 2025, the
Workgroup reviewed the action plan and recommended that the RUC request
that CMS delete G0339 and G0340 having identified a CPT code 77373
(Stereotactic body radiation therapy, treatment delivery, per fraction
to 1 or more lesions, including image guidance, entire course not to
exceed 5 fractions) that is available to report in lieu of G0339 and
G0340.
A review of Medicare claims data shows that HCPCS codes G0339 and
G0340 are billed frequently. HCPCS code G0339 was billed approximately
3,000 times and HCPCS code G0340 12,000 times in 2024 respectively. As
[[Page 43933]]
such, we believe there is a reason to maintain the G codes for image-
guided robotic linear accelerator-based stereotactic radiosurgery
services since both sets of codes are billed so frequently, and we do
not want to cause disruption in billing practice. Since the RUC plans
on reviewing these codes during its September 2026 meeting if the codes
are not deleted for CY 2027, we welcome the RUC's additional
information regarding appropriate coding and payment for these
services.
(9) Request for Revaluation of Physician Work Time Based on Empiric
Data (CPT Codes 15734, 19318,19380, 23472, 27130, 27447, 37227, 37229,
43281, 43644, 47120, 88305, 88307)
An interested party nominated 13 CPT codes as potentially
misvalued. These codes are listed in Table A-D14.
[GRAPHIC] [TIFF OMITTED] TP16JY26.046
The nominator provided evidence that current physician work time
values in the PFS do not accurately reflect real-world clinical
practice for 13 CPT codes across five code families. Their methodology
focused on codes involving large discrepancies between empirically
derived intraservice estimates and intraservice times assigned in the
PFS. The nominator did not assert that their research provided
confirmatory evidence for every intraservice time discrepancy, which is
why their analysis focused on coding families related to the 13 CPT
codes listed previously (Table A-D14). They provided additional details
on their findings related to the 13 CPT codes and other codes included
in their coding families in this section.
Using the 2023 Maryland All-Payer Claims Database (MD-APCD), the
nominator's analysis indicates that some of these codes are likely to
be overvalued. In their nomination, their analysis reveals that the
88305 (Level IV Tissue Exam by Pathologist) code had the highest number
of provider days with intraservice time exceeding an 8-hour workday,
with more than 1,763 days, which was significantly higher than the
other 12 CPT codes. There were 587 instances of physicians billing
88305 so many times in a single day that the total intraservice time
exceeded 24 hours. For these 1,763 days, when they added up the total
time spent on services (including other codes billed in a day, and pre-
services times as well), the average time that services were billed for
during these days was 2,217 minutes (approximately 37 hours).
Additionally, despite the name of the code being ``Tissue Exam by
Pathologist,'' they found that gastroenterologists and dermatologists
frequently billed this code while exceeding eight hours of work in a
single day. According to the nominator, data from a 2016 Urban study
\53\ indicated that the median intraservice time for 88305 was only 2
minutes, compared to 25 minutes in the PFS, which is a 1,250 percent
difference--larger than any of the empiric differences between NSQIP
and the PFS intraservice times.
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\53\ https://www.urban.org/research/publication/collecting-empirical-physician-time-data-piloting-approach-validating-work-relative-value-units. Stephen Zuckerman, Ph.D., Katie Merrell, BA,
Robert A. Berenson, MD, Susan Mitchell, RHIA, Divvy Upadhyay, MD,
MPH, Rebecca Lewis, MPH, Collecting Empirical Physician Time Data:
Piloting an Approach for Validating Work Relative Value Units.
https://www.urban.org/sites/default/files/publication/87771/2001123-collecting-empirical-physician-time-data-piloting-approach-for-validating-work-rel.ative-value-units_0.pdf.
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They also reviewed additional codes outside of the Urban study that
are in the Level IV tissue exam by pathologist coding family,
specifically CPT codes 88302, 88304, 88307, and 88309, to conduct a
thorough check. As a result, they found that CPT code 88307 had 40
provider days where the total intraservice time exceeded 8 hours. The
nominator suggested that CMS should consider reviewing the physician
time for all codes within this family to address the existing PFS
intraservice times.
In addition, they stated that several codes from the integumentary
systems--CPT codes 15734 (Muscle, myocutaneous, or fasciocutaneous
flap; trunk), 19318 (Breast reduction), and 19380 (Revision of
reconstructed breast (e.g., significant removal of tissue, re-
advancement and/or re-inset of flaps in autologous reconstruction or
significant capsular revision combined with soft tissue excision in
implant-based reconstruction))--are likely overvalued as clinicians
spend 34, 90 and 14 days, respectively, performing these services,
where the intraservice times of these codes themselves were more than 8
hours. Over these days, clinicians spent
[[Page 43934]]
an average of 32, 17, and 41 hours when the PFS times for all services
they billed on these days were summed (including pre-service times).
The RAND study \54\ identified that 21 codes in the integumentary
system had PFS intraservice times that were likely too long, and 3
codes had PFS intraservice times that were likely too short.
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\54\ https://www.rand.org/pubs/research_reports/RRA3470-1.html.
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In the musculoskeletal system, they identified specific procedures
with extended service times. For CPT codes 23472 (Arthroplasty,
glenohumeral joint; total shoulder (glenoid and proximal humeral
replacement (e.g., total shoulder))), 27130 (Arthroplasty, acetabular
and proximal femoral prosthetic replacement (total hip arthroplasty),
with or without autograft or allograft), and 27447 (Arthroplasty, knee,
condyle and plateau; medial AND lateral compartments with or without
patella resurfacing (total knee arthroplasty)), there were 12, 10, and
26 Provider Days, respectively, that exceeded the 8-hour intraservice
thresholds. These instances resulted in average total service times of
19, 19, and 21 hours, respectively. The NSQIP RAND study found that 97
musculoskeletal codes had intraservice times that were likely too long,
while 14 had intraservice times that were likely too short.
According to the nominator, CPT codes 43281 (Laparoscopy, surgical,
repair of paraesophageal hernia, includes fundoplasty, when performed;
without implantation of mesh), CPT 43644 (Laparoscopy, surgical,
gastric restrictive procedure; with gastric bypass and Roux-en-Y
gastroenterostomy (roux limb 150 cm or less)), and CPT 47120
(Hepatectomy, resection of liver; partial lobectomy) were found to have
15, 14, and 10 practitioner days, respectively, where the intraservice
time exceeded 8 hours. On these days, the providers recorded average
total service times of 25, 33, and 52 hours, respectively.
Additionally, the nominator stated that the 2015 NSQIP RAND study
identified 86 digestive system codes that were likely too long and 12
codes that were likely too short.\55\
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\55\ https://www.rand.org/content/dam/rand/pubs/research_reports/RR600/RR662/RAND_RR662.pdf.
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We appreciate the detailed information provided to us by external
interested parties and welcome comments from the public regarding any
potential actions for CY 2027 or for future rulemaking. We acknowledge
the limitations associated with NSQIP data in terms of its
applicability to other settings, as it is representative of the
hospital setting, however we believe this empirical data may be a
better input than limited survey data. Therefore, we are seeking
comment on whether we should make these changes for CY 2027, or for
future rulemaking, and whether we should consider making corresponding
changes to the work RVUs for these services or if changes to the
physician time would be sufficient.
(10) Request for Reassessment of Assigned RVUs for ``Harvard-
Valued'' Codes (CPT Codes 24515, 22216, 22210, 64721, 29824, 20610, and
20680)
We received notification from concerned interested parties about
the ``Harvard-valued'' codes from 1992 that have not undergone a
reassessment of assigned RVUs for over 20 years in some cases (see
Table A-D15). We share their concerns about whether the current values
for the CPT codes accurately reflect the resource inputs associated
with furnishing the services. Because the CPT codes have not been
recently reviewed and potentially significant technological changes
have occurred during this time, we are proposing these CPT codes as
potentially misvalued and requesting that the RUC and other interested
parties review these services in terms of appropriate work RVUs, work
time assumptions and direct PE inputs.
[GRAPHIC] [TIFF OMITTED] TP16JY26.047
(11) Allergy Immunotherapy (CPT Code 95165)
In the CY 2001 PFS final rule (65 FR 65393), we discussed the
direct PE inputs for CPT code 95165 (Professional services for the
supervision of preparation and provision of antigens for allergen
immunotherapy; single or multiple antigens (specify number of doses).
As in the case of venoms, some non-venom antigens cannot be mixed
together, that is, they must be prepared in separate vials. An example
of this is mold and pollen. Therefore, some patients will be injected
at one time from one vial--containing in one mixture all of the
appropriate antigens--while other patients will be injected at one time
from more than one vial. We extensively discussed how the practice
expense component for mixing a multidose vial of antigens was computed,
and how we observed that the most common practice at the time was to
prepare a 10 cc vial; we also observed that the most common use was to
remove aliquots with a volume of 1 cc. Therefore, a physician's
removing 10 1cc aliquot doses captured the entire PE component for the
service.
Recently we have received interested parties' communication from
relevant specialties on the definition of a dose as
[[Page 43935]]
it pertains to an allergy immunotherapy. They are concerned that
clinical practice is not using this method of dosage to treat patients
and the definition that Medicare is using is causing general confusion.
They note that Medicare's 1cc aliquot dose is now creating
reimbursement-driven changes to medical practice, rather than changes
that align with clinical practice and is increasingly adopted by
commercial payers and Medicaid plans, thereby negatively impacting the
delivery of medically necessary and cost-effective patient care to
Medicare beneficiaries. According to the specialty societies, when this
Medicare policy was implemented, few Medicare beneficiaries received
allergy immunotherapy--most practices report that less than 5 percent
of patients receiving treatment at that time were Medicare
beneficiaries. Today, specialty societies report, Medicare
beneficiaries often comprise more than 20 percent of an individual
practice's allergy immunotherapy patients.
We invite comment from the wider medical community, including
analyses or studies, regarding CPT code 95165 and the definition of an
allergy immunotherapy dose. In particular, we are interested in how
these concepts are interpreted and implemented within clinical
practice.
Additionally, Medicare utilizes a medically unlikely edit (MUE) of
30 doses per claim to flag potential overutilization. Specialty
societies claim a more appropriate policy should use common clinical
practice, by having an annual limit on doses of medically necessary
treatment. For example, the annual limit of up to 160 doses per year
during the first year of therapy would be higher to account for the
build-up phase, then reduced to 130 or fewer doses per year thereafter
when the beneficiary is receiving maintenance doses.
We welcome comments, including research or opinions from the
medical community, on appropriate annual dose limits billed for CPT
code 95165 based on clinical practice.
(12) Ultrasonic Wound Assessment (CPT Code 97610)
An interested party nominated CPT code 97610 (Low frequency, non-
contact, non-thermal ultrasound, including topical application(s), when
performed, wound assessment, and instruction(s) for ongoing care, per
day) as potentially misvalued due to an inflated supply costs direct PE
input. The nominator stated that this inflation causes a site of
service disparity where CMS pays significantly more for the non-
facility practice expense compared to the hospital outpatient (OPPS)
payment rate. The CY 2026 non-facility PE RVU of 11.51 for CPT code
97610 results in a payment of $384, compared to an OPPS payment rate of
$205, representing a payment differential of $179. The nominator stated
that this disparity is primarily driven by the $320 direct PE input,
SA119 (kit, low frequency ultrasound wound therapy (MIST)). The
nominator provided a hyperlink to the UltraMIST[supreg] system
manufacturer's Investor Presentation \56\ from December 2025 which
states that ``consumable costs = ~$100/procedure (list price).'' On
slide 13 of the presentation, it states that the single use applicators
are $100 and that the pricing reflects manufacturer's suggested retail
price (MSRP). The nominator also estimated an implied sales price of
$86 per disposable kit on average using publicly available manufacturer
disclosures and Medicare claims data. The nominator stated that the
manufacturer reported $21.0 million in U.S. consumable and parts net
revenue for CY 2024. The nominator was able to estimate the total
volume of kits sold by the manufacturer by assuming each of the 745
unique billing NPIs in Medicare claims have approximately one of the
~1,000 UltraMist[supreg] systems in the field, such that the 181,851
Medicare claim lines account for 74.5 percent of total volume ($21.0
million/[181,851/{745/1,000{time} ] = $86), noting that actual sales
price would vary due to volume-based or other supplier discounts,
commercial utilization, and other factors.
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\56\ https://sanuwave.com/investors/presentations.
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We agree with the nominator and are proposing CPT code 97610 as
potentially misvalued. Additionally, we are proposing to change the
cost of supply code SA119 to $100 in the direct PE database. We seek
comment on this proposal and invite interested parties to submit paid
invoices for supply code SA119 (kit, low frequency ultrasound wound
therapy (MIST)). We also note that physician time may be currently
overstated for CPT code 97610, as the December 2025 Investor
Presentation asserts that the procedure takes about 3 to 20 minutes,
with an average of 6 minutes. The current total physician time is
nearly 26 minutes, with a work RVU of 0.39. Because the current
intraservice time is over double the time asserted by the supply
manufacturer in the Investor Presentation, we are seeking comment on
whether the typical physician time to perform this service is closer to
the manufacturer's assertion of 6 minutes or the current intraservice
time of nearly 15 minutes.
(13) Autologous Platelet Rich Plasma (HCPCS Code G0465)
We received a request from a nominator to review HCPCS code G0465
(Autologous platelet rich plasma (PRP) or other blood-derived product
for diabetic chronic wounds/ulcers, using an FDA-cleared device for
this indication, (includes as applicable administration, dressings,
phlebotomy, centrifugation or mixing, and all other preparatory
procedures, per treatment) as potentially misvalued. The nominator
requested that CMS update the work RVUs for HCPCS code G0465 from 1.78
to 5.50 based on the results of an independent survey of physicians and
qualified health professionals who have training and experience
treating chronic, non-healing diabetic wounds that was performed by a
third party in the Fall of 2025. The nominator also requested that CMS
update its policy to state that multiple procedure payment adjustments
do not apply to HCPCS code G0465. Additionally, in the CY 2025 PFS
Final rule, we finalized crosswalking G0465 to CPT code 15275
(Application of skin substitute graft to face, scalp, eyelids, mouth,
neck, ears, orbits, genitalia, hands, feet, and/or multiple digits,
total wound surface area up to 100 sq cm; first 25 sq cm or less wound
surface area), however, the nominator believes this is not an
appropriate crosswalk for G0465.
We thank the nominator for submitting the information, including
the survey conducted by the third party. However, we note the sample
size of the survey shows only 34 respondents and so we have concerns as
to whether this is a representative sample size of practitioners
furnishing this service. Additionally, we continue to believe that the
MPPR payment adjustment is applicable to multiple units of this service
billed to the same beneficiary on the same day due to overlapping
resource costs. Given that no additional information was submitted to
support the increase in work RVU, we are not proposing this code as
potentially misvalued.
E. Request for Information: Redesigning Primary Care To Make America
Healthy Again
1. Introduction
Primary care is an essential component of the HHS Secretarial
priority to ``Make America Healthy Again'' commonly known as MAHA.\57\
[[Page 43936]]
Relatively and accurately valuing primary care appropriately is
essential. It is the cornerstone of a high-functioning health care
system, helping enable the shift in U.S. health care toward a focus of
preventive rather than reactive medicine--for health care rather than
``sick care.'' \58\ Critical to this transition is incentivizing
investment in high-value care that reduces health care costs
(especially from chronic disease) in the long term. Building off recent
HHS rulemaking that established such incentives for commercial health
plans,\59\ we are interested in how Original Medicare may similarly be
able to incorporate more robust incentives to invest in high-value
care, which will reduce costs of care in the long-term within the
Physician Fee Schedule (PFS). More specifically, the agency is
soliciting comment on how we might reconsider primary care service
valuation to better support this objective amidst what may be a
meaningful shift in how primary care is delivered given more recent
technological innovation.
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\57\ U.S. Department of Health and Human Services. Make America
Healthy Again (MAHA). HHS.gov, https://www.hhs.gov/maha/index.html.
Accessed 29 Apr. 2026.
\58\ Kennedy, R.F., Jr. (2025). Remarks on the U.S. ``sick-care
system.'' Fox News interview. https://www.foxnews.com/health/rfk-jr-likely-confirmed-health-secretary-dr-siegel-saysAccessed5/31/26.
\59\ ``Patient Protection and Affordable Care Act, HHS Notice of
Benefit and Payment Parameters for 2027; and Basic Health Program.''
Federal Register, vol. 91, 2026, p. 29683. U.S. Government, https://www.federalregister.gov/d/2026-10050/p-1540.
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Primary care services delivered in the physician office were the
locus for continuous, coordinated, and comprehensive care when the PFS
was established in 1992. This definition of primary care as a
beneficiary's first point of contact with the health care system \60\
has been increasingly challenged by broader access to medical
information through digital resources. This may accelerate as the
increasing adoption of technology reshapes access to increasingly
sophisticated sources of medical information before beneficiaries ever
show up in the doctor's office.\61\ Advances in technology, including
generative and agentic artificial intelligence (AI), are poised to
transform both beneficiary experience \62\ and the role of the primary
care clinicians.\63\ These were not anticipated when defining the
relative value units and time and intensity of services delivered by
physicians, which are essential inputs to the PFS.\64\
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\60\ O'Connor, S.M. ``Citing Primary Care.'' British Journal of
General Practice, vol. 61, no. 586, 2011, pp. 361-362. https://pmc.ncbi.nlm.nih.gov/articles/PMC3133574.
\61\ Rastogi, Namrata. ``Healthcare's New Frontier: The Digital
Front Door.'' BMJ Innovations, vol. 8, no. 2, 2022, https://doi.org/10.1136/bmjinnov-2021-000874.
\62\ Yang, Betsy, et al. ``Transforming the Primary Care Journey
with Generative AI: A Foundation Model to Boost Efficiency, Quality,
and Engagement.'' Journal of General Internal Medicine, 2026,
https://doi.org/10.1007/s11606-025-09716-y.
\63\ Sarkar, Urmimala, and David W. Bates. ``Using Artificial
Intelligence to Improve Primary Care for Patients and Clinicians.''
JAMA Internal Medicine, vol. 184, no. 4, 2024, pp. 343-344. https://doi.org/10.1001/jamainternmed.2023.7965.
\64\ Berenson, Robert A., and Kevin J. Hayes. ``Could Artificial
Intelligence Affect Physician Payment for Nonprocedural Services?
Part 1.'' Health Affairs Forefront, Health Affairs, 2025, https://www.healthaffairs.org/content/forefront/could-artificial-intelligence-affect-physician-payment-nonprocedural-services-part-1.
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To both support broader MAHA priorities and to reconcile with how
technology is reshaping primary care delivery for beneficiaries and
clinicians, we are seeking comment on how to re-imagine and improve the
relative valuation of primary care services. We are focused on
understanding how that re-imagination might occur within the current
construct of office/outpatient (O/O) evaluation and management (E/M)
services as well as via alternatives to fee-for-service payment,
including through outcomes-based payment and/or the expansion of
prospective primary care payment (PPCP). The latter, in particular, has
long been a goal of external policy experts, including as a
recommendation from the 2021 National Academy of Science, Engineering,
and Medicine report `Implementing High Quality Primary Care,' which
recommends team-based delivery supported by `hybrid' payment models
that combine prospective monthly and visit-based payments.\65\ Over the
past decade, the CMS Innovation Center tested PPCP in Medicare using a
series of increasingly sophisticated hybrid payment approaches from the
Comprehensive Primary Care initiative (CPC) to Primary Care First
(PCF). The lessons learned from these Innovation Center model tests led
Medicare to establish advanced primary care management (APCM) codes in
the CY 2025 PFS final rule as a first step towards PPCP.\66\ The
potential changes to primary care practice with increasing adoption of
technology also raises concerns for increasing opportunity for fraud,
waste, and abuse from malicious actors.\67\ For these and other
reasons, as the agency thinks about the re-imagination of primary care
payment in the PFS, we are considering first establishing PPCP
permanently in the Medicare Shared Savings Program. We would also like
to better understand if there are suggestions on how to implement PPCP
within the broader Original Medicare program with appropriate
guardrails.\68\
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\65\ National Academies of Sciences, Engineering, and Medicine.
``Designing Interprofessional Teams and Preparing the Future Primary
Care Workforce.'' Implementing High-Quality Primary Care: Rebuilding
the Foundation of Health Care, National Academies Press, 2021.
\66\ Agarwal, Sumit D., et al. ``The Underuse of Medicare's
Prevention and Coordination Codes in Primary Care: A Cross-Sectional
and Modeling Study.'' Annals of Internal Medicine, vol. 175, no. 8,
2022, pp. 1100-1108. https://doi.org/10.7326/M21-4770.
\67\ Gray, Jacob. ``Strengthening Healthcare Program Integrity
with AI.'' ICF, 2026, https://www.icf.com/insights/health/healthcare-fraud-waste-abuse-ai.
\68\ Centers for Medicare & Medicaid Services. Accountable Care
Organization Operational System (ACO-OS). CMS, https://security.cms.gov/pia/accountable-care-organization-operational-system.
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We seek comment on three main topics:
Reconsidering relative primary care payment in the
Medicare PFS: We are increasingly concerned about the relative
undervaluation of primary care services. We would like feedback on how
to reconsider this relative undervaluation in the PFS under the current
paradigm of O/O E/M visits, the Annual Wellness Visit (AWV), and care
management codes. We seek comment on updating this code set, and how or
if CMS should consider a `two-track' approach to care management
services with one track focused on technology enabled care and the
other track focused on `traditional' care management.
The payment implications of technology-enablement of
primary care: We are seeking comment on how technology and clinical AI
are impacting primary care, both broadly and more narrowly within the
care management codes and the AWV. We also would like to better
understand how CMS might update its approach to paying for technology-
enabled care given the potentially transformative effects on the
beneficiary and clinician experience. If we were to approach paying for
technology-enabled primary care differently, how should we consider the
relative valuation, in terms of time and intensity of services? How
else could these services be valued? How should we consider evidence of
the impact or outcome of technology-enabled services in primary care?
Establishing Prospective Primary Care Payment in the
Medicare Shared Savings Program: Given the series of CMS Innovation
Center PPCP model tests, how should CMS approach establishing PPCP in
the Shared Savings Program, and more broadly across Original Medicare?
In short, this RFI seeks comment on how we should evaluate which of
the payment models discussed previously in this section (FFS payment
models, outcomes-based payments, or prospective payment) makes the most
[[Page 43937]]
sense for primary care given the rapid changes that may arise for
recent technological innovation.
2. Reconsidering Relative Primary Care Payment in the Medicare
Physician Fee Schedule
a. O/O E/M Visits
Under the PFS, in accordance with section 1848 of the Act, we
establish payment amounts for covered physicians' services and update
payment policies to address changes, including those in medical
practice, coding, or new data on relative value components. Original
Medicare's fee-for-service payments for primary care services are
overwhelmingly made through traditional O/O E/M visit codes. E/M codes
describe a broad range of physician services that occur in an office
setting, and do not distinguish between a one-time consultative visit
and care that is part of a longitudinal care relationship, which may
require additional time, coordination, and resources. We have
previously described our concern that the complexity of services
required to provide longitudinal care is not fully incorporated as part
of the valuation of the work RVUs when the E/M code itself is used as
the primary way to report the work of the professional (88 FR 78972).
The physician community had previously supported this view when they
highlighted that the existing E/M services, such as office visits, do
not adequately describe the typical non-face-to-face care management
work required by certain categories of beneficiaries most often served
by primary care practitioners (78 FR 43337).
As a result, specialties that do not routinely furnish procedural
interventions or diagnostic tests and for which E/M visits represent a
greater share of total allowed services are paid differently and
generally less than their counterparts who routinely furnish procedural
interventions and diagnostic tests. Section 1848 of the Act prohibits
specialty-specific payment under the PFS, so we cannot vary the
conversion factor or the number of relative value units for a
physician's service based on the specialty type of the physician.
Instead, in CY 2021, we adopted the RUC's recommendations for increased
E/M work RVUs, based on their review of physician time for the E/M
visit code set (84 FR 62851 through 62854). Next, in the CY 2024 PFS
final rule, we took steps to better recognize the inherent complexity
of visits associated with primary and longitudinal care of patients by
finalizing Healthcare Common Procedure Coding System (HCPCS) code G2211
(Visit complexity inherent to evaluation and management associated with
medical care services that serve as the continuing focal point for all
needed health care complex condition. (Add-on code, list separately in
addition to office/outpatient evaluation and management service, new or
established)). HCPCS code G2211 is used by practitioners furnishing
services as the continuing focal point for all the patient's needed
health care services, including but not limited to primary care
practitioners (88 FR 78969). In the CY 2026 PFS final rule (90 FR 49462
through 49464), we finalized our proposal to allow HCPCS code G2211 to
be billed as an add-on code with the home or residence E/M visits, in
addition to office/outpatient E/M visits. We are proposing changes to
HCPCS code G2211 for CY 2027; see section II.D of this proposed rule
for further discussion.
The current O/O E/M code set may still insufficiently reflect
differences in the nature and intensity of care provided. As such, we
are considering establishing distinct categories of O/O E/M visits in
future rulemaking. Potential categories could be longitudinal care,
acute care, or consultative visits, with distinctions based on the
clinical purpose of the encounter and the associated resource costs of
furnishing care. Longitudinal care visits involve care delivered both
during and between encounters as part of an ongoing comprehensive care
relationship. During these visits, a beneficiary establishes,
maintains, or updates that relationship. For example, a beneficiary
returns to the clinic 3 months after their AWV for ongoing management
of their diabetes, which requires an oral medication titration, and
elevated blood pressure and hyperlipidemia, which includes a discussion
about lifestyle modification. The practitioner also notices that they
are overdue for an immunization, schedules them for a necessary
screening test, and updates their plan of care accordingly. We would
distinguish this visit (including the valuation of the pre- and post-
service time and proximity to prior visits) from the care delivered in
an acute care visit. In the future, we may consider valuing these
visits as a combination of the E/M service furnished during the
encounter and certain between-visit care management activities. In
contrast, acute care visits are focused on the evaluation and
management of a discrete, episodic problem that is generally resolved
after treatment. For example, a beneficiary may seek care for a sore
throat and suspected streptococcal pharyngitis, with no expectation of
an ongoing care relationship related to that condition once it is
resolved. While consultative visits are distinct from longitudinal and
acute care visits because they are furnished in response to a referral
to address a specific clinical question, consultative services could be
considered similar in complexity to acute care, distinguished largely
by consultative services typically including an evaluation of the
patient and communication of findings or recommendations back to the
referring practitioner.
We also note that CPT codes exist and are paid by private payers
for consultative services (for example, CPT codes 99242 through 99245),
although they are not paid by Medicare. We are seeking comment on
whether to consider the complexity of these services to be closer to
the acute care services versus the longitudinal care services. As a
general matter, we would expect to consider consultative visits to be
less complex than longitudinal care visits. We are seeking feedback on
further actions we could take around appropriate valuation of primary
care services:
What updates to the HCPCS code G2211 policy (or the
proposed modifiers, MOD1 and MOD2) should CMS consider to ensure the
clinician billing HCPCS code G2211 (or proposed modifiers, MOD1 and
MOD2) is serving as the focal point for beneficiaries, and that the
practitioner is also considering preventive care, risk factor
reduction, and other services necessary for coordinating the care of
beneficiaries who have a complex condition?
Given the broad range of changes CPT makes annually, we
recognize updates to the CPT code set to reflect distinctions among O/O
E/M visits by the function of the visit (longitudinal, acute, or
consultative) may have significant advantages within the current
billing and coding ecosystem. However, absent a change in CPT coding,
should we consider the possibility of creating G codes to better
recognize distinction between and among these kinds of visits? If so,
what categories should we consider? How could we effectively
differentiate longitudinal care visits from acute care visits? What
number of levels would be needed and for which settings of care? Should
we use existing CPT codes as templates? How should we consider valuing
these potential G-codes under the PFS, including the basis for the
standard inputs: work RVUs, time
[[Page 43938]]
values, specialty mix for utilization crosswalks, direct PE inputs,
etc.? How would practitioners balance and manage the increasing number
and complexity of these codes?
If CMS were to propose longitudinal or primary care visit
types, what should the service period be? Should subsequent care
management services be bundled in? If so, for what period of time?
Which care management services might be included?
Are there specific data on the resources used in
furnishing longitudinal care, acute care, or consultative services CMS
should consider for potential categorization of O/O E/M services?
3. Care Management Code `Family'
We have for the last 14 years sought to unbundle services
previously considered bundled into E/M services through separate coding
and payment for care management services. In 2013, the agency
implemented a transitional care management code for post-discharge care
(77 FR 68978). This was then followed by the creation of a broader
family of codes for care management, including for beneficiaries with
multiple chronic conditions or chronic care management (CCM) (78 FR
74414), for those requiring complex medical decision-making (for
example, complex CCM, 81 FR 80349), and for those with a single or
principal condition (principal care management (PCM), 85 FR 84697). In
total, the CCM and PCM code families now include five sets of codes
which are reported monthly on a timed basis, each set with a base code
of 20 to 60 minutes and an add-on code for each additional 30 minutes.
In the CY 2025 PFS final rule (89 FR 97859), we finalized three APCM
codes (HCPCS codes G0556, G0557, and G0558) to recognize the evolving
way primary care practices manage prevention and chronic condition
management through interprofessional care teams. See Table A-E1 for
more specificity on the purpose of each of the codes.
Despite these important steps to pay separately for care management
services, uptake of the care management codes has been limited.\69\
Interested parties cite cost-sharing and non-trivial documentation
requirements as the primary barriers to broader adoption.\70\ In
response to these considerations, we removed the CCM requirement to
count and document the minutes of care management services provided in
the patients' medical record when billing APCM services. Interested
parties had stated this was so burdensome it limited their use of the
CCM Current Procedural Terminology (CPT) codes. At the same time, the
agency was concerned about program integrity and therefore code
auditability. In the absence of medical record documentation, we
required that if a practitioner billed the APCM codes, they must report
the Value in Primary Care MIPS Value Pathway (89 FR 97864). Despite
these changes, uptake in the first year was less than anticipated. We
seek feedback on whether a different payment structure might be more
appropriate as well as what might be done to further simplify the code
set and associated requirements.
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\69\ Agarwal SD, Basu S, Landon BE. The Underuse of Medicare's
Prevention and Coordination Codes in Primary Care: A Cross-Sectional
and Modeling Study. Ann Intern Med. 2022 Aug;175(8):1100-1108. doi:
10.7326/M21-4770. Epub 2022 Jun 28. PMID: 35759760; PMCID:
PMC9933078.
\70\ Agarwal SD, Barnett ML, Souza J, Landon BE. Adoption of
Medicare's Transitional Care Management and Chronic Care Management
Codes in Primary Care. JAMA. 2018;320(24):2596-2597. doi:10.1001/
jama.2018.16116.
[GRAPHIC] [TIFF OMITTED] TP16JY26.048
We are also asking for comment on how to reconfigure the care
management code `family' to better establish effective relative payment
options for between visit care management services and how supervision
requirements may need to change in technology-enabled care models where
patients may initially engage with digital tools or receive care
entirely in a digital environment. In addition, given our concerns
about fraud, waste, and abuse in the care management code families, we
would like to better understand how to ensure care management services
are impacting care.
To improve the utilization of care management services where it is
clinically appropriate, we seek comment on the following questions:
What additional requirements should CMS consider to reduce
fraud, waste, and abuse in care management services? Specifically on
the following:
++ What is the appropriate `trigger' or initiating visit for care
management services? How would this change if it were an initiating
visit vs. another event?
++ Should CMS consider changing supervision requirements in care
management services to prevent fraudulent billing of care management
services? What is the appropriate supervision requirement for care
management services?
++ How should data submission to CMS change to verify services are
received?
++ What guardrails should CMS consider to prevent inappropriate
billing?
++ What proportion of care management services must be delivered
[[Page 43939]]
by the supervising provider, versus auxiliary personnel?
Are there specific data on the resources used in
furnishing advanced primary care, which incorporates population health
management, enhanced communication technology, and longitudinal care
management? We welcome submission of any such data.
To what extent are the current care management codes
duplicative? Are there efficiencies to be gained in simplifying the
current care management code `family' into a more efficient code set?
To what extent would this improve appropriate utilization of care
management services?
If reducing the number of care management codes would not
increase efficiency or utilization of appropriate services, how else
can CMS standardize the requirements across the care management codes?
As care management becomes increasingly technology-
enabled, how should CMS consider changing the code family and their
relative valuations? How can CMS ensure that automated billing
leveraging technology reflects actual care delivered to beneficiaries
by care teams or practitioners?
Should CMS create `technology-enabled care management'
codes or a `two-track' approach to care management? How should we
ensure these codes are appropriately differentiated?
4. Payment Implications of Technology Enablement of Primary Care
a. Changes to Primary Care and Care Management Due to Technology and
Clinical AI
Adoption of new technology and AI tools in primary care has the
potential to transform clinical care to such a degree that it may
challenge how we traditionally think about care delivery. However, as
of this request for information, clinician-facing AI tools that are
currently in widespread use are more focused on administrative burden
reduction and clinical decision-support. For example, tools focused on
reducing clinician documentation burden (e.g. AI scribes), have perhaps
been the most widely taken up by clinicians,\71\ with an estimated 25%
penetration among all US physicians.\72\ Early system-level evaluations
demonstrate generally increased productivity among adopters along with
decreases in perceived documentation burden.\73\ The most widely used
AI tool in primary care is likely a clinical decision-support
application, Open Evidence, which more than forty percent of US
physicians have self-reported using.\74\ This software allows
clinicians to ask an AI chat interface a wide variety of clinical
questions and receive answers based on a large language model only
drawing from well-known peer reviewed journals and guidelines (i.e. not
the entire internet). AI-assisted care delivery agents have been
deployed in a number of health systems but have not yet reached
widespread use, to the best of CMS' knowledge.\75\ In general, we note
greater technological adoption may support a shift in care management
from reactive, manual processes to proactive, data-driven, and
personalized care.
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\71\ Littrell, A. (2026, May 19). The AI tool physicians
actually love: A conversation with Robert Wachter, M.D., chair of
UCSF Medicine. Medical Economics. https://www.medicaleconomics.com/view/the-ai-tool-physicians-actually-love-a-conversation-with-robert-wachter-m-d-chair-of-ucsf-medicine.
\72\ Doximity. (2026). State of AI in medicine report 2026.
https://www.doximity.com/reports/state-of-ai-medicine-report/2026.
\73\ Holmgren AJ, Fenton CL, Thombley R, et al. Ambient
Artificial Intelligence Scribes and Physician Financial
Productivity. JAMA Netw Open. 2026;9(1):e2553233. doi:10.1001/
jamanetworkopen.2025.53233.
\74\ OpenEvidence. (2025, July 15). OpenEvidence, the fastest-
growing application for physicians in history, announces $210
million round at $3.5 billion valuation. https://www.openevidence.com/announcements/openevidence-the-fastest-growing-application-for-physicians-in-history-announces-dollar210-million-round-at-dollar35-billion-valuation.
\75\ Examples include ''Cedars-Sinai Connect'', from https://www.cedars-sinai.org/csconnect.html or 'Hartford Healthcare GPT'
https://www.aha.org/aha-center-health-innovation-market-scan/2026-05-19-hartford-healthcare-embraces-ai-patientgpt. Retrieved May 31,
2026.
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In short, we believe technology is being used in increasingly
innovative ways throughout primary care but would like to better
understand that usage. Given this changing backdrop, we are seeking
comment on how we develop a comprehensive and consistent approach to
payment for technology-enabled care given likely lower cost-to-serve
but potentially higher quality of care delivered. There are challenges
in establishing appropriate valuation methodologies, due to the rapidly
evolving nature, accuracy, impact, and scope of these technologies as
well as the limited transparency into underlying costs and effect of
these tools in primary care and other specialties.
One potential approach may be to link payment more directly to
demonstrated clinical outcomes. We are seeking additional information
on how to best structure payment for these technologies in a way that
aligns with our agency's mission to increase quality, improve health,
reduce costs, and strengthen the healthcare system. Clinical technology
tools of interest would include those that provide clinical decision-
making support that deliver AI-assisted (or augmented, etc.) primary
care, or that are otherwise of note. We seek input on the following:
Our understanding is that clinical documentation and
clinical decision-support tools are currently the most commonly used
applications of AI in primary care. Does this reflect current practice?
In particular, are there additional clinical AI tools and new
technologies that are frequently being used in primary care settings
with high accuracy, demonstrated safety, and clinical outcomes
reported? If so, please describe how they impact the clinical workflow
and the beneficiary experience.
If you are a physician furnishing primary care services,
how has your practice been impacted or how do you expect it will be
impacted by clinical AI tools?
How has incorporating technology and AI tools impacted the
resource costs associated with primary care practice, in terms of the
time and intensity of services delivered?
How has the implementation of clinical AI tools led to
improvements in the quality of care, or reduced downstream costs? In
general, please cite any evidence available for your comments.
If these tools are increasing productivity, what are
clinicians and other health professionals doing with the additional
time/bandwidth created? Are you seeing more patients in visits,
engaging more with population-health management or care management,
accomplishing administrative tasks, or something else?
How do you ensure patient data and privacy is adequately
protected during use of these tools?
Please describe areas where clinical AI tools in primary
care are not well captured in the current coding and payment system and
suggest how these may be incorporated to facilitate high-value,
technology-enabled primary care.
What lessons can CMS learn and adopt from private payors with
respect to clinical AI? More specifically, we ask the following:
What can CMS learn from how private payors have approached
payment and coverage of clinical AI in primary care? How are they
monitoring for safety, privacy, fraud, waste, and abuse?
How could private payor coverage of clinical AI in primary
care streamline or otherwise facilitate CMS coverage or payment?
[[Page 43940]]
From an outcomes-based perspective, how should CMS
evaluate and monitor the impact of technology-enabled care in primary
care?
What outcomes would accurately capture whether these
technologies have improved or negatively affected primary care practice
for both clinicians and beneficiaries? Are there different outcomes for
short-term and long-term impacts?
What type of outcomes data should be shared with CMS? For example,
to what extent would submission via Fast Healthcare Interoperability
Resources (FHIR)-based APIs of clinical outcomes or activity sets be an
appropriate approach by which to tie payment?
What submission frequency and formats would be most
appropriate?
How can we collect those outcomes in a way that minimizes
administrative burden?
Are there other payment structures, beyond outcomes-based
and prospective (which will be discussed in the next section), that
would be more suited to the unique nature and impact of these
technologies? If so, please describe.
5. Technology and AI-Augmentation in Primary Care via the Medicare AWV
As we at CMS endeavor to shift US health care toward a focus on
preventive rather than reactive medicine--for health care rather than
`sick care'--there may be no more obvious starting place for Medicare
than the Initial Preventive Physical Exam (IPPE) and Medicare AWVs. The
IPPE is a one-time preventive check-up where practitioners review the
beneficiary's medical history, make sure they are up to date on
important screenings and vaccines, and talk with the beneficiary about
their family history and how to stay healthy.\76\ Then every year
following, beneficiaries have a conversation-focused visit to create a
personalized prevention plan, called an Annual Wellness Visit
(AWV).\77\
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\76\ ``Welcome to Medicare Preventive Visit.'' Medicare.gov,
Centers for Medicare & Medicaid Services, https://www.medicare.gov/coverage/welcome-to-medicare-preventive-visit. Accessed 16 June
2026.
\77\ ``Yearly `Wellness' Visits.'' Medicare.gov, Centers for
Medicare & Medicaid Services, https://www.medicare.gov/coverage/yearly-wellness-visits. Accessed 16 June 2026.
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The IPPE and AWV were established under section 4103 of the
Affordable Care Act which requires Medicare to cover an AWV in which a
personalized prevention plan is created (Pub. L. 111-148). The payment
for AWVs has been updated to reflect the resource costs associated with
advanced care planning (80 FR 70956), review of opioid use (85 FR
84713), and optionally physical activity and nutrition (90 FR 49483).
The current requirements can be found on the CMS website.\78\
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\78\ Centers for Medicare & Medicaid Services. ``Medicare
Wellness Visits.'' Centers for Medicare & Medicaid Services, U.S.
Department of Health and Human Services, https://www.cms.gov/medicare/coverage/preventive-services/medicare-wellness-visits.
Accessed 7 July 2026.
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Section 1861(hhh)(4)(F) of the Act gives the Secretary the
authority to experiment with the use of personalized technology
focusing on health behavior change. We are interested in understanding
whether advances in technology, including clinical AI, could improve
the effectiveness, personalization, and both beneficiary and clinician
experience for the AWV. Despite the importance of prevention and early
identification of risk factors, evidence regarding the impact of the
AWV on outcomes is mixed. Some studies have found that AWV receipt is
associated with increased use of preventive services \79\ but may not
sufficiently close gaps in preventive care.\80\ However, other studies
have found no substantive association between AWV adoption and
improvements in evidence-based screening, acute care utilization, or
spending,\81\ or potentially increasing downstream low-value
services.\82\ Given the heterogeneity of these findings, we are
interested in whether technology-enabled AWVs can improve not only the
proportion of Medicare beneficiaries completing an AWV but also
meaningful outcomes.
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\79\ Beckman AL, et al. The effect of Medicare's Annual Wellness
Visit on preventive care for the elderly. Prev Med. 2018;116:126-
133.
\80\ Camacho F, Yao N, Anderson R. The Effectiveness of Medicare
Wellness Visits in Accessing Preventive Screening. Am J Health
Promot. 2017.
\81\ Ganguli I, Souza J, McWilliams JM, Mehrotra A, et al.
Association of Medicare's Annual Wellness Visit with Cancer
Screening, Referrals, Utilization, and Spending. Health Affairs.
2019.
\82\ Ganguli I, Lupo C, Mainor AJ, et al. Assessment of
Prevalence and Cost of Care Cascades After Routine Testing During
the Medicare Annual Wellness Visit. JAMA Netw Open.
2020;3(12):e2029891. doi:10.1001/jamanetworkopen.2020.29891.
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We are interested in whether clinical adoption of technology
including clinical AI tools may facilitate transformation of the AWV
from a point-in-time assessment to a more continuous, data-driven, and
beneficiary-specific preventive care function. The function of these
tools may support AWV completion from pre-visit activities as well as
activities during and after the clinical encounter. As examples,
clinical AI tools may support pre-visit collection of beneficiary
reported information such as in the health risk assessment, adapting
questions to a beneficiary's language or health literacy level.\83\ For
reviewing the medical and family history, AI tools have demonstrated
superiority to even human experts in summarizing health information
from structured and unstructured fields.\84\ During the clinical
encounter, AI tools may also support standardized clinical workflows
embedded in the electronic health record environment,\85\ identify
beneficiaries who may warrant additional assessment, and generate
suggested follow up steps for clinicians to review.\86\ Following the
encounter, AI tools may assist with developing post-encounter
instructions in the language and health literacy level of the
patient.\87\
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\83\ Swisher AR, Wu AW, Liu GC, Lee MK, Carle TR, Tang DM.
Enhancing Health Literacy: Evaluating the Readability of Patient
Handouts Revised by ChatGPT's Large Language Model. Otolaryngol Head
Neck Surg. 2024 Dec;171(6):1751-1757. doi: 10.1002/ohn.927. Epub
2024 Aug 6. PMID: 39105460.
\84\ Van Veen D, Van Uden C, Blankemeier L, et al. Adapted large
language models can outperform medical experts in clinical text
summarization. Nature Medicine. 2024;30:1134-1142.
\85\ Perkins SW, Muste JC, Alam T, Singh RP. Improving Clinical
Documentation with Artificial Intelligence: A Systematic Review.
Perspect Health Inf Manag. 2024 Jun 1;21(2):1d. PMID: 40134899;
PMCID: PMC11605373.
\86\ Yao, X., Rushlow, D.R., Inselman, J.W. et al. Artificial
intelligence-enabled electrocardiograms for identification of
patients with low ejection fraction: a pragmatic, randomized
clinical trial. Nat Med 27, 815-819 (2021). https://doi.org/10.1038/s41591-021-01335-4.
\87\ Young, Albert T., et al. ``Patients and Dermatologists Are
Largely Satisfied with ChatGPT-Generated After-Visit Summaries: A
Pilot Study.'' JAAD International, vol. 15, 2024, pp. 33-35.
Elsevier, https://doi.org/10.1016/j.jdin.2023.12.004.
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We believe much of this can occur under current CMS billing
guidance, and reiterate that under current policy, the AWV must be
performed by a physician or other health professional, or team of
medical professionals directly supervised by a physician currently
enrolled as a Medicare provider. We are interested in what barriers--if
any--these requirements create to innovative AWV delivery models in
which an AI technology company develops or operates these clinical AI
tools and affiliates with a Medicare enrolled provider or supplier. We
seek comment on the following:
How can CMS improve the effectiveness, efficiency,
personalization, and beneficiary experience of the IPPE and Medicare
AWV?
Which, if any, AWV components are being delivered (or
could be) more efficiently delivered through technology and clinical
AI-enabled tools? Please comment on how technology is being used today
within the AWV, how that
[[Page 43941]]
has changed over the last year, and how the community sees that
changing over the next couple of years. Which activities require direct
involvement by a physician, qualified non-physician practitioner, or
medical professional under physician supervision?
Could AI-enabled AWVs improve health outcomes that prior
studies have found to be inconclusive?
What evidence should CMS consider regarding whether
technology or clinical AI-enabled AWVs improve clinical usefulness of
visit and clinical outcomes, beneficiary reported outcomes, or
utilization? In particular, research around changes in the use of
preventive services, the application of preventive services to
individual clinical risk factor assessment or in low-value downstream
utilization are of specific interest.
What existing statutory, regulatory, enrollment, billing,
supervision, documentation, data-sharing or other requirements may
create barriers to an AI technology company delivering AWV-related
services while employing or contracting with appropriately licensed
physicians or other medical professionals to perform AWVs? To what
extent may program integrity concerns exist with these models?
In what circumstances should CMS consider payment or
policy changes that would allow technology-enabled organizations,
including AI technology companies, to participate in AWV delivery
models, either directly or through partnerships with Medicare-enrolled
providers or suppliers?
How should CMS evaluate whether AI-enabled AWVs are
improving outcomes rather than merely increasing AWV volume,
documentation completeness, coding intensity, or low-value care follow
`cascades' of services? Specifically, for which outcomes should CMS
hold technology companies accountable?
How could CMS optimize information sharing from AWV
throughout the duration of the primary care relationship? Where could
AI-enabled tools facilitate this process?
6. Developing Prospective Payment in the Shared Savings Program
a. Background
We stated at the beginning of this request for information that we
are interested in further developing prospective primary care payment
(PPCP) in Original Medicare, beginning with the Shared Savings Program.
There is growing recognition that the fee-for-service (FFS) payment
model has inherent limitations as a primary care payment mechanism, as
it is not designed to support the comprehensive, coordinated care that
primary care requires. In 2015, the Medicare Payment Advisory
Commission (MedPAC) recommended a per beneficiary payment for primary
care providers to support additional care coordination activities for
Medicare beneficiaries.\88\ MedPAC explained that while a per
beneficiary payment in itself will not guarantee an increase in care
coordination activities or even an increase in compensation for
eligible primary care practitioners, it would be a first step in
transitioning from FFS to a beneficiary-centered payment approach that
encourages care coordination, including the non-face-to-face activities
that are a critical component of care coordination.\89\
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\88\ Medicare Payment Advisory Commission. 2015. Report to the
Congress: Medicare Payment Policy, page 106 Washington, DC: MedPAC.
https://www.medpac.gov/document/http-www-medpac-gov-docs-default-source-reports-mar2015_entirereport_revised-pdf/.
\89\ Medicare Payment Advisory Commission. 2015. Report to the
Congress: Medicare Payment Policy, page 106 Washington, DC: MedPAC.
https://www.medpac.gov/document/http-www-medpac-gov-docs-default-source-reports-mar2015_entirereport_revised-pdf/.
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In a 2021 report on implementing high-quality primary care, the
National Academies of Sciences, Engineering, and Medicine (NASEM)
recommended that health care payers ``pay for primary care teams to
care for people, not doctors to deliver services'' and encouraged
payers to adopt a hybrid reimbursement model that combines FFS and
capitation over time with an overarching goal to eventually pay for the
majority of primary care services through risk-adjusted prospective
payment.\90\ NASEM recommended that a hybrid reimbursement model--with
a mix of FFS and lump-sum or per-person payments--become the default
method for paying for primary care teams.\91\ NASEM found that with
time, hybrid reimbursement models show improvements in care and
reductions in use, particularly for people with multiple complex
chronic conditions.\92\
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\90\ National Academies of Sciences, Engineering, and Medicine.
``Implementing High-Quality Primary Care: Rebuilding the Foundation
of Health Care,'' pages 7-8. Washington, DC: The National Academies
Press, 2021. https://doi.org/10.17226/3393 https://www.nationalacademies.org/read/25983/chapter/3#8.
\91\ National Academies of Sciences, Engineering, and Medicine.
``Implementing High-Quality Primary Care: Rebuilding the Foundation
of Health Care,'' page 8. Washington, DC: The National Academies
Press, 2021. https://doi.org/10.17226/3393 https://www.nationalacademies.org/read/25983/chapter/3#8.
\92\ National Academies of Sciences, Engineering, and Medicine.
``Implementing High-Quality Primary Care: Rebuilding the Foundation
of Health Care,'' page 301. Washington, DC: The National Academies
Press, 2021. https://doi.org/10.17226/3393 https://www.nationalacademies.org/read/25983/chapter/3#8.
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Over the past 13 years, the CMS Innovation Center has tested a
number of models that have progressively moved away from FFS billing,
including: CPC, Comprehensive Primary Care Plus (CPC+), PCF, Next
Generation ACO (NGACO), Global and Professional Direct Contracting
(GPDC) Model, ACO REACH, and ACO Primary Care (PC) Flex. These models
have focused on testing whether Medicare payment for primary care
services through hybrid payments (a mix of FFS and capitated payments),
population-based payments (PBPs), or total care capitation (TCC)
improves quality of care for beneficiaries and reduces Medicare spend.
Evidence from these models suggests that primary care capitation (PCC)
is most effective when it is embedded in an accountable care framework,
such as the Shared Savings Program.\93\ Model design and evaluations
are available on the model-specific websites that can be found on
https://www.cms.gov/priorities/innovation/models#views=models.
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\93\ See, for example, O'Malley A, Singh P, Fu N, et al.
Independent Evaluation of the Comprehensive Primary Care Plus
(CPC+): Final Report. Mathematica, page xviii. December 2023.
https://www.cms.gov/priorities/innovation/data-and-reports/2023/cpc-plus-fifth-annual-eval-report.
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Previous Innovation Center primary care model tests have yielded
lessons that shape current and future work, including the development
of codes and payment for APCM services. Participants, namely
clinicians, in primary care models have indicated, however,
difficulties with investing in and maintaining primary care redesign
activities due to a range of challenges. First, additional non-visit-
based primary care payments have been generally layered upon base
payments that are still predominantly FFS in structure. While payment
for APCM services represents a meaningful step toward non-visit-based
payments in concept, we do not view APCM as the end goal of primary
care payment reform. The payment amounts associated with APCM are
predicated on furnishing and billing APCM services. As such, APCM
retains the fundamental structure of FFS billing and may not provide
sufficient incentives for practices to focus on proactive, population-
based non-visit care management activities.
Second, Innovation Center model funding that supports salaries for
clinical and administrative staff, who are needed for advanced primary
care coordination and population health
[[Page 43942]]
functions, is contingent on continued participation in these models.
Unlike APCM codes,\94\ which are billing codes paid under the PFS and
can be used to support ongoing primary care workforce investments, once
the models end, practices are left without the funding that they
received under the models for the clinical and administrative staff
that had supported population health functions. Based on a review of
internal CMS data related to billing for APCM services, billing for
APCM services is higher for Shared Savings Program ACO-assigned
beneficiaries compared to Medicare beneficiaries outside of an ACO.
This finding suggests that the accountability and care management
infrastructure associated with ACOs may support more robust adoption of
non-visit based primary care payment mechanisms.
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\94\ Three APCM codes and payment amounts were established in
the CY 2025 Physician Fee Schedule final rule (89 FR 97859 through
97902). In the CY 2026 PFS final rule, CMS established three new G-
codes (HCPCS codes G0568, an add-on code based on CPT code 99492,
G0569, an add-on code based on CPT code 99493 for CoCM services
delivered to patients also receiving APCM services, and G0570, an
add-on code for general behavioral health integration services based
on CPT code 99484) to be billed as add-on services to APCM base
codes: HCPCS codes G0556, G0557, and G0558 (90 FR 49464 through
49471).
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Table A-E3 identifies recent Innovation Center models that tested
capitated payment arrangements. As outlined in the table, the payment
arrangements tested across these models reflect a progression from
hybrid (FFS + capitation) payment structures to PBPs and TCC, with each
successive model designed to build upon the experience of previous
models. CPC+ and PCF relied on care management fees, performance-based
incentive payments, and PBPs that partially replaced traditional FFS
billing. While neither model reduced total Medicare expenditures or
achieved net savings, the CPC+ evaluation found that independent
practices who spent a longer time in the model, and those participating
in the Shared Savings Program tended to have more favorable
results.\95\ This finding underscores the importance of embedding
primary care payment reform within an accountable care framework.
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\95\ O'Malley A, Singh P, Fu N, et al. ``Independent Evaluation
of the Comprehensive Primary Care Plus (CPC+): Final Report,'' page
209. Mathematica. December 2023. https://www.cms.gov/priorities/innovation/data-and-reports/2023/cpc-plus-fifth-annual-eval-report.
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Other Innovation Center models that have tested different kinds of
cash flow and primary care capitated payments have focused on ACOs in
models that build on the foundation of the Shared Savings Program. For
example, ACOs in the NGACO model could select from four payment
mechanisms: (1) traditional FFS; (2) FFS with a fixed per beneficiary
per month (PBPM) infrastructure payment; (3) PBPs that gave ACOs a
fixed percentage of expected FFS claims reductions in prospective
monthly payments; or (4) all-inclusive PBPs, in which the ACO received
expected FFS claim reductions in prospective monthly payments. Three
quarters of NGACOs primarily chose FFS-based payment mechanisms such as
the FFS or FFS with infrastructure payment (FFS+ISP). NGACOs electing
PBP mechanisms had larger spending reductions of 3 percent ($409.1 per
beneficiary per year (PBPY), p<0.01), compared with 1.3 percent ($172.9
PBPY, p<0.01) for NGACOs electing FFS-based payment mechanisms.
Additionally, NGACOs, particularly the 35 that remained through PY 6,
showed improvements in model reported quality measures over time for
prevention and screening and for chronic disease management. Further,
25 of 35 NGACOs had reduced cumulative Medicare spending while
maintaining or reducing rates of ambulatory care-sensitive conditions-
related hospitalizations or 30-day unplanned readmissions, tended to
reduce outpatient spending and Emergency Department visits, and tended
to reduce skilled nursing facility spending and utilization. Over the
course of the model, NGACOs invested in initiatives to better manage
their patient populations, toward the goals of reduced spending and
improved quality.\96\
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\96\ Lowell, K.H., and contributing authors. ``Evaluation of the
Next Generation Accountable Care Organization (NGACO) Model, Final
Report,'' page 10. Bethesda, MD: NORC at the University of Chicago,
2024. https://www.cms.gov/priorities/innovation/data-and-reports/2024/nextgenaco-sixthevalrpt.
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Under the GPDC Model \97\ (the successor to the NGACO model) and
the ACO REACH model,\98\ we offered two capitation options: (1) TCC (a
PBPM capitated payment for all Medicare Part A and Part B services) and
(2) PCC for primary care services equal to seven percent of the
estimated total cost of care and composed of both a base amount and an
enhanced amount designed to provide upfront revenue. Direct contracting
entities and ACOs that selected PCC could also select an advanced
payment option (APO), which provided upfront payments for services
beyond primary care.
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\97\ Lowell, K.H., and contributing authors. ``Evaluation of the
Global and Professional Direct Contracting Model, Annual Report 2.''
Bethesda, MD: NORC at the University of Chicago, 2024. https://www.cms.gov/priorities/innovation/data-and-reports/2024/gpdc-2nd-ann-report.
\98\ ``ACO REACH Model, PY 2026 Financial Operating Policies:
Capitation and Advanced Payment Mechanisms.'' Baltimore, MD: RTI
International, 2025. https://www.cms.gov/priorities/innovation/files/aco-reach-py26-financial-ops-capitation-payment-mechanisms.pdf.
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The ACO PC Flex model extends capitated payment arrangements to
ACOs participating in the Shared Savings Program. The model is designed
to test how prospective payments and increased funding for primary care
in ACOs affects health outcomes, quality, and costs of care within the
Shared Savings Program.\99\ Model participants are limited to ACOs that
participate in the Shared Savings Program and qualify as a ``low
revenue ACO'' as defined by Sec. 425.20.\100\ ACOs participating in
the ACO PC Flex Model receive two payments: a monthly PPCP and a one-
time advanced shared savings payment. The PPCP is a PBPM payment for
primary care services that replaces FFS payments for eligible primary
care services with a monthly prospective payment composed of a county
base rate (based on a county's average primary care spending), an ACO
enhanced amount, and a population adjustment.\101\ ACOs are required to
spend at least 90 to 95 percent (depending on the performance year) of
the total PPCP payment on the provision of care.\102\ The ACO enhanced
amount includes three types of payment enhancements: (1) the county
enhancement, which is applied at the county level in counties
designated as low spending counties relative to standardized spending
nationally; (2) the flex enhancement, which is applied at the ACO level
to all PC Flex ACOs, regardless of location or utilization, and (3) the
enhancement add-on, which is a fixed amount PBPM for a performance year
that may be used to increase the
[[Page 43943]]
ACO enhanced amount for underlying changes in the Medicare PFS that are
not reflected in the rate book. The enhanced amount will not be subject
to recoupment in full by CMS based on the PC Flex ACO's performance in
achieving shared savings.\103\ Although interest in the ACO PC Flex
model was robust, many eligible ACOs that expressed initial interest in
the model ultimately did not submit applications, citing challenges
associated with the application timeline. Additionally, several
interested parties shared that concurrent interest in the Making Care
Primary model was a factor in their decision not to participate in ACO
PC Flex.
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\99\ ACO PC Flex (ACO Primary Care Flex) Model website: https://www.cms.gov/priorities/innovation/innovation-models/aco-primary-
care-flex-model.
\100\ Under Sec. 425.20, a ``low revenue ACO'' is an ACO whose
total Medicare Parts A and B fee-for-service revenue of its ACO
participants, based on revenue for the most recent calendar year for
which 12 months of data are available, is less than 35 percent of
the total Medicare Parts A and B fee-for-service expenditures for
the ACO's assigned beneficiaries, based on expenditures for the most
recent calendar year for which 12 months of data are available.
\101\ ACO Primary Care Flex Model Financial Methodology: Rate
Book Development, Calculation of Monthly Prospective Primary Care
Payment, and Financial Settlement, June 2025, version 2, pages 1-2.
https://www.cms.gov/files/document/aco-pc-flex-fin-meth-ratebook-dev.pdf.
\102\ ACO Primary Care Flex Model Financial Methodology: Rate
Book Development, Calculation of Monthly Prospective Primary Care
Payment, and Financial Settlement, June 2025, version 2, page 56.
https://www.cms.gov/files/document/aco-pc-flex-fin-meth-ratebook-dev.pdf.
\103\ ACO Primary Care Flex Model Financial Methodology: Rate
Book Development, Calculation of Monthly Prospective Primary Care
Payment, and Financial Settlement, June 2025, version 2, page 33.
https://www.cms.gov/files/document/aco-pc-flex-fin-meth-ratebook-dev.pdf.
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The Innovation Center recently announced the Long-term Enhanced ACO
Design (LEAD) model,\104\ which is scheduled to begin on January 1,
2027. As currently designed, LEAD's capitated payment architecture
builds directly on the framework used in ACO REACH and ACO PC Flex.
Similar to ACO REACH and the ACO PC Flex model, participating ACOs will
be required to select from either: (1) TCC payment or (2) PCC payment.
The LEAD model plans to offer ACOs that elect PCC the option to receive
additional payments to extend value-based arrangements beyond primary
care. Specifically, ACOs may elect the non-primary care capitation
(NPCC) or the APO to support alternative payment arrangements for non-
primary care providers. It is anticipated that these options would
allow ACOs to incrementally expand capitation beyond primary care
without adopting full TCC.
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\104\ https://www.cms.gov/priorities/innovation/innovation-models/lead.
[GRAPHIC] [TIFF OMITTED] TP16JY26.049
b. Primary Care Capitated Payment Arrangements Considerations for the
Shared Savings Program
The goal of capitated payments is to give health care providers
additional flexibility in how they deliver care and to reduce the
volume-based incentives of Original Medicare (OM) payment. With
capitated payments, health care providers receive steady, predictable
cash flow that is not tied to the number of services they provide. This
flexibility frees health care providers to deliver care in innovative
and flexible ways, such as non-face-to-face care management,
telehealth, and electronic messaging, without worrying about foregone
OM revenue, tying these services to overall outcomes. We are interested
in building on the experience of previous Innovation Center models that
tested capitated payment arrangements. Section 1899(i)(2) of the Act
authorizes the Secretary to use partial capitation in which an ACO is
at financial risk for some, but not all, of the items and services
covered under parts A and B, such as at risk for some or all
physicians' services or all items and services under part B, provided
that the partial capitation payments for a year made under the partial
capitation model do not result in additional program expenditures than
would otherwise be expended for such ACO for such beneficiaries for
such year if the model were not implemented. The Secretary may limit a
partial capitation model to ACOs that are highly integrated systems of
care and to ACOs capable of bearing risk, as determined to be
appropriate by the Secretary. Additionally, section 1899(i)(3) of the
Act authorizes the Secretary to use other payment models instead of the
one-sided model described in section 1899(d) of the Act as long as the
Secretary determines that the other payment model will improve the
quality and efficiency of items and services furnished to Medicare
beneficiaries without additional program expenditures.
We have previously described how primary care teams are central to
the relative success of Shared Savings Program ACOs.105 106
In 2024, as in
[[Page 43944]]
previous years, ACOs comprised of larger proportions of primary care
clinicians had significantly higher net per capita savings than ACOs
comprised of smaller proportions of primary care clinicians (with $403
vs $224 in net per capita savings).\107\ In recent years, we have
received significant input from interested parties regarding
opportunities to increase participation in ACO initiatives. One such
option to increase participation would be to identify ways that the
Shared Savings Program can support ACOs' efforts to strengthen primary
care, such as by providing prospective monthly primary care capitated
payments to primary care practices, to reduce reliance on OM payments
and support innovations in care delivery that better meet beneficiary
needs.
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\105\ ``Medicare Shared Savings Program Continues to Deliver
Meaningful Savings and High-Quality Health Care'', October 29, 2024,
Press Release. https://www.cms.gov/newsroom/press-releases/medicare-shared-savings-program-continues-deliver-meaningful-savings-high-quality-health-care.
\106\ ``Medicare Shared Savings Program Saves Medicare More Than
$1.8 Billion in 2022 and Continues to Deliver High-quality Care'',
August 24, 2023, Press Release. https://www.cms.gov/newsroom/press-releases/medicare-shared-savings-program-saves-medicare-more-1-8-billion-2022-continues-deliver-high-quality.
\107\ Medicare Shared Savings Program Accountable Care
Organizations Updated Performance Year 2024 Financial and Quality
Results Fact Sheet, September 29, 2025. https://www.cms.gov/files/document/fact-sheet-ssp-py24-financial-quality-results.pdf.
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In the CY 2026 PFS proposed rule (90 FR 32502), we solicited
comments on whether CMS should consider new payments to Shared Savings
Program ACOs for prospective monthly APCM payments to be delivered to
primary care practices that satisfy the APCM billing requirements, with
the payments reconciled under the ACO benchmark. Nearly all commenters
supported giving ACOs the option to receive prospective APCM payments.
Only one commenter opposed prospective APCM payments, arguing that APCM
delivery solely through ACOs risks undermining the core principles of
CCM.
We are seeking feedback regarding potential primary care capitated
payment arrangements in the Shared Savings Program. Specifically, we
are requesting input on the following questions:
ACO and ACO Participant Readiness
To what extent are Shared Savings Program ACOs and ACO
participants, and their associated health care providers (referred to
herein as ``ACO providers/suppliers''), ready to take on capitated
payment arrangements? Please describe ACO and ACO participant level of
readiness for each of the following:
++ Hybrid capitation (a combination of capitated and OM payments).
++ Full capitation for primary care services (that could enable
ACOs to provide downstream payments to ACO participants).
++ PBPs as a fixed percentage of expected OM claims.
We are interested in understanding what operational changes ACOs
would need to undertake to effectively receive, manage, and distribute
capitated payments. Please describe any barriers or conditions--legal,
financial, or operational--that could affect an organization's
readiness to participate in each type of arrangement.
If an ACO received capitated payments for primary care
services furnished by ACO providers/suppliers billing through the TIN
of an ACO participant (as defined in Sec. 425.20), what organizational
and programmatic goals would the ACO seek to advance with those
payments? For example, we are interested in understanding whether ACOs
would use capitated payments to expand the scope or capacity of
existing care coordination and population health programs, or whether
capitated payments would instead enable ACOs to operationalize new care
delivery initiatives. Please describe the specific types of initiatives
that ACOs would seek to implement, and how ACOs would ensure that these
payments went to support primary care practices directly.
Eligibility for Participation
Should CMS limit access to capitated payment arrangements
exclusively to ACOs participating in two-sided risk tracks (BASIC
tracks C, D, E or the ENHANCED track), or should all ACOs be eligible
to receive some form of capitated payments, regardless of the ACO's
participation track? ACOs participating in two-sided risk tracks must
establish a repayment mechanism prior to the start of an agreement
period, and we are interested in whether similar proof that an ACO
could repay losses should be required as a condition for receiving
capitated payments, even for ACOs in one-sided risk tracks.
Should CMS limit capitated payment arrangements to ACOs
with prior risk-bearing experience--either through participation in a
previous Shared Savings Program agreement period in a two-sided risk
track (BASIC tracks C, D, E or the ENHANCED track) or through prior
participation in a risk-bearing track in an Innovation Center model,
such as ACO REACH--or should risk-bearing ACOs in their first Shared
Savings Program agreement period also be eligible to participate in
capitated payment arrangements? Why would commenters support one
approach over the other? We are interested in whether prior experience
with risk-bearing should be an explicit prerequisite for capitated
payment eligibility or whether risk-bearing ACOs in their first
agreement period should also be eligible to participate in capitated
payment arrangements.
Should CMS permit some, but not all, ACO participants
within an ACO to participate in capitated payment arrangements, or
should CMS require all ACO participants within an ACO to participate in
capitated payment arrangements?
Should CMS establish a minimum percentage of attributed
beneficiaries \108\ for whom eligible primary care practices must be
furnishing care management services to receive capitated payments,
either at the ACO level or at the individual ACO participant level?
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\108\ Specific Medicare beneficiaries for whom an ACO is
responsible for the care and total cost of care. Generally
determined based on care furnished during a specific calendar window
and the clinicians that provided the care.
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To what extent should the payment design and structure
differ based on the level of risk or participation track of an ACO?
Payment Design and Structure
What percentage of base year OM payments should be
replaced by PCC, and what factors should guide this determination? For
example, under the ACO REACH model, the PCC payment--including both the
base PCC and the enhanced PCC--is set at 7 percent of the REACH ACO's
prospective monthly performance year benchmark, a level designed to
provide ACOs with a predictable, non-visit-based revenue stream for
primary care services.
What services should be included in primary care
capitation (and reciprocally, in a fee reduction) to accurately capture
an appropriate scope of primary care services furnished to
beneficiaries, balancing the importance of providing up-front flexible
payments, with the potential for risk to practices if service
utilization grows? For example, under both the ACO REACH and ACO PC
Flex models, the set of services eligible for primary care capitated
payments is based on a specific list of CPT and HCPCS codes billed by
primary care specialists (health care providers with specific specialty
codes). In both models, the PCC bundle includes certain E/M office
visits along with CCM, behavioral health integration, transitional care
management, AWVs, advance care planning, and virtual communication
services.
We are interested in feedback about whether and in what
form we should establish an enhanced primary care payment amount--in
addition to the base primary care capitated payment amount--as a
feature of primary care capitated payment arrangements in the Shared
Savings Program. Specifically, we are interested in:
[[Page 43945]]
++ Calculation: For example, in ACO REACH, the enhanced primary
care payment is calculated as a fixed percentage of the ACO's
performance year benchmark, while in ACO PC Flex, the Flex Enhancement
component of the primary care payment is calculated as a fixed dollar
amount ($125) per eligible beneficiary per year, with additional
enhancements (i.e. the County Enhancement) derived from county-level or
regional spending benchmarks.
++ Reconciliation: In ACO REACH, enhanced primary care capitation
(EPCC) is subject to recoupment at the end of the performance year. In
ACO PC Flex the enhanced amount is included in total cost of care,
subject to offsets from the prior savings adjustment and/or the
regional adjustment.
We are interested in whether CMS should consider offering
an advanced payment option (APO) within the Shared Savings Program,
similar to the APO offered by the ACO REACH model, to ACOs that have
elected PCC. Specifically, we are interested in:
++ Does the availability of an APO enhance an ACO's ability to
align specialist financial incentives with the ACO's total cost of care
goals, or do the structural and administrative requirements of
implementing an APO within the Shared Savings Program present barriers
that outweigh the potential benefits?
++ Do Shared Savings Program ACOs have access to sufficient data--
shadow bundles, claims data, public use files, and data from
arrangements with other payers--to support the development and ongoing
administration of an APO? If not, what data would be necessary?
The ACO REACH model has offered TCC as a payment option
for ACOs assuming the highest level of financial risk. The LEAD model
also plans to offer TCC as a payment option for ACOs assuming the
highest level of financial risk. We are interested in whether CMS
should provide a full capitation option to Shared Savings Programs
ACOs. Specifically, we seek feedback on:
++ Should CMS consider offering a full capitation option to Shared
Savings Program ACOs that have demonstrated readiness to administer
prospective payments, under which all Medicare Part A and Part B
services furnished to assigned beneficiaries by ACO providers/suppliers
billing through the TIN of ACO participants--but not services furnished
to assigned beneficiaries by providers that are not on the ACO's
participant list--would be paid through a TCC payment?
++ Should CMS limit full capitation to ACOs in tracks with the
highest level of risk--ENHANCED track or BASIC track Level E--on the
basis that full capitation should be reserved for ACOs that have
already assumed downside financial risk and the organizational
readiness to manage prospective payment for Medicare Part A and Part B
services?
++ Are there other flexibilities that CMS should give ACOs to make
TCC effective?
++ How should CMS calculate the per-beneficiary, per-month payment
amount under a full capitation arrangement in the Shared Savings
Program? Under ACO REACH, the monthly TCC payment amount paid to the
ACO equals 1/12 of the performance year benchmark, adjusted by the TCC
withhold.\109\
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\109\ Because it is expected that a portion of the total cost of
care for aligned beneficiaries will be for services provided by
providers and suppliers not participating in the TCC arrangement,
CMS will withhold a portion of the monthly TCC amount to avoid the
need for significant year-end recoupments from the REACH ACOs.
https://www.cms.gov/priorities/innovation/files/aco-reach-py26-financial-ops-capitation-payment-mechanisms.pdf.
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Should CMS issue prospective capitated payments on a
monthly or quarterly basis? Please describe the potential advantages,
disadvantages, and operational implications of each approach.
Should capitated payments be paid to ACOs and distributed
downstream to ACO participants, or should CMS make payments directly to
ACO participants that provide primary care services, similar to how CMS
makes payments for APCM services, and what are the implications of each
approach? Should CMS consider alternative mechanisms for delivering
capitated payments directly to ACO Participants that are also primary
care practices participating in Shared Savings Program ACOs? If so,
what payment design, infrastructure, and policy considerations should
guide the development of such alternative payment mechanisms?
If capitated payments are issued directly to ACOs, should
CMS require ACOs to provide a specific percentage of those payments to
ACO participants that provide primary care services? How might this be
audited? Additionally, should CMS require ACOs to have written
capitated payment agreements with ACO participants to specify that a
minimum percentage of the capitated payment will flow to ACO
participants?
Care Delivery Requirements
Should CMS require ACOs seeking to participate in
capitated payment arrangements to make commitments to specific care
delivery goals as a condition for participation? If so, what goals
should be required and how should compliance be assessed and enforced?
For example, we are interested in whether we should require ACOs to
submit a primary care transformation plan--similar to the care delivery
requirements under the CPC+ model, which required participating
practices to demonstrate progress across five comprehensive primary
care functions, including access and continuity, care management,
comprehensiveness and coordination, patient and caregiver engagement,
and planned care and population health--that specifies measurable
targets for care delivery improvements, such as expanding after-hours
access, increasing care management for high-risk beneficiaries, or
reducing avoidable emergency department utilization.
How should CMS balance meaningful capitated payment levels
with reduced administrative and reporting burdens for participating
ACOs, and what primary care delivery requirements should CMS establish
as conditions of eligibility for capitated payment arrangements in the
Shared Savings Program? Should compliance with any care delivery
requirements be monitored on a quarterly or annual basis, with the
potential for payment recoupment in cases of noncompliance?
Should CMS require that ACOs and ACO participants
receiving capitated payments demonstrate the use of data-driven risk
stratification methods to identify high-risk beneficiaries and target
enhanced care management resources toward those beneficiaries? CMS
provides Shared Savings Program ACOs with data that could be used for
risk stratification, such as claims-based beneficiary data, risk
scores, and quality performance reports. We are interested in whether
CMS should require ACOs and ACO participants to use these data as a
baseline input for their risk stratification methodologies or whether
ACOs and ACO participants should be given the flexibility to design
their own risk stratification approaches.
Should care delivery requirements for capitated payment
eligibility increase depending on the level/type of capitated payment
selected by the ACO or ACO participants? For example, should ACOs that
are receiving a higher percentage of capitated payments be subject to
more comprehensive care delivery requirements or should a uniform set
of care delivery requirements apply to all ACOs, regardless of the
percentage of capitated payments they receive?
[[Page 43946]]
c. Primary Care Capitated Payment Arrangements Considerations Outside
of the Shared Savings Program
Though CMS is first exploring the development of PPCP within the
guardrails of accountable care discussed in the third section of this
RFI, we are also considering extending these efforts in future years to
develop a bundled or capitated approach, called a `global period' in
the broader Original Medicare program (OM). In OM, many services,
including surgical and maternity care services, are managed as `global'
periods by OM, where reasonable and necessary medical services are
delivered throughout an episode. Primary care, once an initiating visit
has occurred, could also be reimbursed over an interval of care
consistent with the development of a trusting, longitudinal
relationship between clinician and patient. We have not previously
proposed a primary care `global' period, in part because of the
difficulty to ascertain where a primary care relationship starts, and
where it stops, through claims data or other information readily
obtained by CMS. We do attribute beneficiaries to organizations
participating in alternative payment models, such as ACOs in the
Medicare Shared Savings Program, based on a plurality of primary care
services delivered and also maintain the possibility for beneficiaries
to voluntarily align to a Shared Savings Program ACO through
Medicare.gov where beneficiaries select a primary care provider.
To establish a primary care global period would require a number of
services to be `bundled' within the primary care global code family,
including the IPPE or AWV, O/O E/M services, and care management
services such as advanced primary care management services. Central to
the challenge inherent in bundling together previously disparate
services is ensuring beneficiaries would maintain access to care. CMS
could monitor for any potential denials or limitations in care
associated with the transition to a global period. We also would like
to seek public input on which and how many of the services should be
bundled, if they should be bundled entirely or through a `hybrid'
capitation with reduced FFS model, and how best to establish the
payment levels for this global period. We seek input on the following:
What would be the appropriate services to bundle in such a
primary care global period (e.g. E/M, care management codes, AWV,
etc.)? How should the agency consider the benefits and drawbacks
regarding quality of care, patient safety, and evidence regarding care
delivery changes in a fully or globally capitated approach with no per-
visit payment vs. a hybrid payment approach with reduced per-visit
payment and per-member per-month payment?
For both a fully capitated and hybrid payment approach,
CMS has in past considered patient complexity (e.g. number of chronic
conditions or HCC level) in our alternative payment models for primary
care. How should CMS approach defining these levels or stratum for
payments in a fully capitated or hybrid payment model for primary care?
How many levels should be considered?
In the absence of an encounter, is there another
appropriate `trigger' or initiation for a primary care global period?
How long should it last? Is beneficiary receipt of an AWV in the
previous 12 months sufficient?
What necessary reporting requirements and accountability
should CMS require for clinicians receiving primary care capitated
payments? For example, should there be explicit minimum visit
requirements for a clinician to be eligible to receive primary care
capitated payments for their Original Medicare patients? Should we
require specific clinical outcomes-based reporting? If so, what
clinical outcomes should we measure?
Broadly, to what extent should the approach Original
Medicare takes to primary care payment differ between the Shared
Savings Program and the broader program? If yes, how?
In so much as the agency considers a prospective primary
care payment (PPCP) for primary care, to what extent should the IPPE/
AWV be the initiating visit for that global period?
F. Comprehensive Outpatient Rehabilitation Facility (CORF) Services and
KX Modifier Threshold, and Medical Review Threshold
1. Technical Corrections of CORF Regulations
During rulemaking for CY 2008 (72 FR 66399), we made several
regulation text revisions and redesignations at Sec. 410.100 without
changing a related regulatory provision of Sec. 410.105 for the
requirements for coverage of CORF services. We also created a new
subpart M at 42 CFR 414.1105 for payment of CORF items and services
that includes references to Sec. 410.100 without making the
corresponding revisions to the sections that were amended during CY
2008 PFS rulemaking.
We are proposing to revise Sec. 410.105(b)(3)(ii) for the home
environment evaluation to indicate that the home environment evaluation
is specified at Sec. 410.100(l) and not Sec. 410.100(m) as it
currently reads.
We are proposing to amend the regulation at Sec. 414.1105(c) for
CORF supplies and durable medical equipment to indicate that the
supplies and durable medical equipment that are CORF services is
specified at Sec. 410.100(k) instead of Sec. 410.100(l), as it
currently reads. At the same time, we are also proposing to remove from
Sec. 414.1105(c) language that relates to CORF drugs and biologicals
because the provisions relating to payment for drugs and biologicals
that are CORF services are at Sec. 414.1105(d), which was added in the
CY 2008 PFS final rule.
We are requesting comments on these proposals.
2. KX Modifier Thresholds
The KX modifier thresholds were established through section 50202
of the Bipartisan Budget Act of 2018 (Pub. L. 115-123, February 9,
2018) (BBA) and were formerly referred to as the therapy cap amounts.
These per-beneficiary amounts under section 1833(g) of the Act (as
amended by section 4541 of the Balanced Budget Act of 1997) (Pub. L.
105-33, August 5, 1997) are updated each year based on the percentage
increase in the Medicare Economic Index (MEI). Specifically, these
amounts are calculated by updating the previous year's amount by the
percentage increase in the MEI for the upcoming calendar year and
rounding to the nearest $10.00. Thus, for CY 2027, we propose to
increase the CY 2026 KX modifier threshold amount by the most recent
forecast of the 2017-based MEI. For CY 2027, the proposed MEI increase
is estimated to be 2.5 percent and is based on the expected historical
percentage increase of the 2017-based MEI. Multiplying the CY 2026 KX
modifier threshold amount of $2,480 by the proposed CY 2027 percentage
increase in the MEI of 2.5 percent ($2,480 x 1.025) and rounding to the
nearest $10.00 results in a proposed CY 2027 KX modifier threshold
amount of $2,540 for physical therapy and speech-language pathology
services combined and $2,540 for occupational therapy services. We also
propose to update the MEI increase for CY 2027 based on historical data
through the second quarter of 2026, and we propose to use such data, if
appropriate, to determine the final MEI percentage increase and the CY
2027 KX modifier threshold amounts in the CY 2027 PFS final rule.
[[Page 43947]]
Section 1833(g)(7)(B) of the Act describes the targeted medical
review (MR) process for services of physical therapy, speech-language
pathology, and occupational therapy services. The threshold for
targeted MR is $3,000 through CY 2027. Effective beginning with CY
2028, the MR threshold levels will be annually updated by the
percentage increase in the MEI, per section 1833(g)(7)(B) of the Act.
Consequently, for CY 2027, the MR threshold is $3,000 for physical
therapy and speech-language pathology services combined and $3,000 for
occupational therapy services. Section 1833(g)(5)(E) of the Act states
that CMS shall identify and conduct targeted medical review using
factors that may include the following:
The therapy provider has had a high claims denial
percentage for therapy services under this part or is less compliant
with applicable requirements under this title.
The therapy provider has a billing pattern for therapy
services under this part that is aberrant compared to peers or
otherwise has questionable billing practices for such services, such as
billing medically unlikely units of services in a day.
The therapy provider is newly enrolled under this title or
has not previously furnished therapy services under this part.
The services are furnished to treat a type of medical
condition.
The therapy provider is part of a group that includes
another therapy provider identified using the factors described
previously in this section.
We track each beneficiary's incurred expenses for therapy services
annually and count them towards the KX modifier and MR thresholds by
applying the PFS rate for each service less any applicable multiple
procedure payment reduction (MPPR) amount for services of CMS-
designated ``always therapy'' services (see the CY 2011 PFS final rule
at 75 FR 73236). We also track therapy services furnished by critical
access hospitals (CAHs), applying the same PFS-rate accrual process,
even though they are not paid for their therapy services under the PFS
and may be paid on a cost basis (effective January 1, 2014) (see the CY
2014 PFS final rule at 78 FR 74406 through 74410).
When the beneficiary's incurred expenses for the year for
outpatient therapy services exceed one or both of the KX modifier
thresholds, therapy suppliers and providers use the KX modifier on
claims for subsequent medically necessary services. Using the KX
modifier, the therapist and therapy provider attest that the services
above the KX modifier thresholds are reasonable and necessary and that
documentation of the medical necessity for the services is in the
beneficiary's medical record. Claims for outpatient therapy services
exceeding the KX modifier thresholds without the KX modifier included
are denied.
G. Supporting Beneficiaries Planning for Future Medical Decisions
1. Advance Care Planning (ACP) Services (HCPCS Codes GACP1 and GACP2)
a. Background
Medicare currently pays for ACP services as an optional element of
the annual wellness visit (AWV) or a Part B medically necessary service
(see 80 FR 70955 and https://www.cms.gov/files/document/mln-advanced-care-planning.pdf). While the Social Security Act covered a similar
service as a voluntary part of the initial preventive physical exam
under section 1861(ww)(3) of the Act since CY 2012, in CY 2016 we
adopted new coding developed by the American Medical Association for
payment of ACP services as a separate Part B medically necessary
service or an optional element of the annual wellness visit (AWV). In
this section of our proposed rule, we propose to create additional
codes in this family that more explicitly describe and value the
contributions of clinical staff in the provision of ACP services. We
emphasize that clinicians must not, under any circumstances, attempt to
influence their patients' decisions for ACP.
For CY 2015, the CPT Editorial Panel created two new codes
describing ACP services by physicians and other qualified healthcare
professionals (QHPs): CPT code 99497 (Advance care planning including
the explanation and discussion of advance directives such as standard
forms (with completion of such forms, when performed), by the physician
or other qualified health care professional; first 30 minutes, face-to-
face with the patient, family member(s), and/or surrogate) and an add-
on code, CPT code 99498 (Advance care planning including the
explanation and discussion of advance directives such as standard forms
(with completion of such forms, when performed), by the physician or
other qualified health care professional; each additional 30 minutes
(List separately in addition to code for primary procedure)) (80 FR
70955).
In the CY 2015 PFS final rule with comment period (79 FR 67670), we
assigned a PFS interim final status indicator of ``I'' (Not valid for
Medicare purposes. Medicare uses another code for the reporting and
payment of these services. This code is not subject to a 90-day grace
period.) to CPT codes 99497 and 99498. We had received many public
comments in response to the CY 2015 proposed rule recommending that we
recognize and make separate payment for both CPT codes, in view of the
time required to furnish the services and their importance for the
quality of care and treatment of the patient. In the CY 2015 PFS final
rule with comment period we responded that we would consider paying for
CPT codes 99497 and 99498 after we had the opportunity to go through
notice and comment rulemaking (80 FR 70955).
The following year, in the CY 2016 PFS final rule, we finalized our
proposal to assign CPT codes 99497 and 99498 a PFS status indicator of
``A'' (Active) with RVUs based on the RUC recommended values. We
adopted the RUC-recommended work RVU, physician time and direct PE
inputs: 1.5 work RVUs and 1.4 work RVUs for CPT codes 99497 and 99498,
respectively. We also added ACP as an optional element, at the
beneficiary's discretion, of the AWV and made conforming changes to our
regulations at Sec. 410.15 that describe the conditions for and
limitations on coverage for the AWV (80 FR 70959). In addition to
adopting both CPT codes, we adopted CPT provisions regarding the
reporting of timed services (80 FR 70956). We have also instructed
practitioners that when reporting ACP as part of managing a
beneficiary's illness, the condition discussed with the beneficiary is
reported on the claim, whether or not an E/M visit is billed the same
day (https://www.cms.gov/files/document/mln-advanced-care-planning.pdf). When ACP services are part of an AWV and furnished on
the same day by the same practitioner as the AWV, an administrative
exam or exam diagnosis is reported along with modifier 33 indicating
the ACP services are preventive and not subject to cost sharing
(https://www.cms.gov/files/document/mln-advanced-care-planning.pdf). In
the CY 2016 PFS final rule, we also adopted CPT's coding guidance for
ACP performed in conjunction with an E/M visit. CPT prefatory language
indicates that when using CPT codes 99497 and 99498, no active
management of the problem(s) is undertaken during the time period
reported, and these codes may be reported separately if performed on
the
[[Page 43948]]
same day as most E/M visits.\110\ We cited a clinical vignette from the
RUC recommendations, illustrating when the services described by CPT
codes 99497 and 99498 could be reasonable and necessary for the
diagnosis or treatment of illness or injury, stating that this could
occur in conjunction with the management or treatment of a patient's
current condition, such as a 68 year old male with heart failure and
diabetes on multiple medications seen by his physician for the E/M of
these two diseases, including adjusting medications as appropriate (80
FR 70955). In addition to discussing the patient's short-term treatment
options, the patient might express interest in discussing long-term
treatment options and planning, such as the possibility of a heart
transplant if his congestive heart failure worsens, and advance care
planning including the patient's desire for care and treatment if the
patient suffers a health event that adversely affects the patient's
decision-making capacity (80 FR 70956). In this case the physician
would report a standard E/M CPT code for the E/M service and one or
both of the CPT codes describing ACP, depending upon the duration of
the ACP service (80 FR 70956). Moreover, the ACP service would not
necessarily have to occur on the same day as the E/M service (80 FR
70956).
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\110\ Current Procedural Terminology, (CPT[supreg]) 2026 (CPT
Codebook), Professional Edition, American Medical Association, page
61.
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The CPT Codebook published by the American Medical Association
contains prefatory language that describes CPT codes 99497 and 99498 as
a ``face-to-face service between a physician or other qualified health
care professional and a patient, family member, or surrogate in
counseling and discussing advance directives, with or without
completing relevant legal forms.'' \111\ While this code descriptor
language indicates that the time being billed is personally spent by
the physician/QHP and the codes are valued accordingly, we finalized a
provision in the CY 2016 PFS final rule that allowed the time of
clinical staff to be counted if the billing physician or other billing
practitioner managed, participated and meaningfully contributed to the
provision of the services, because public commenters persuaded us that
ACP was performed at times by a team of a treating physician or other
treating practitioner and their staff. Therefore, in the CY 2016 PFS
final rule (80 FR 70957), we stated that we believed the services
described by CPT codes 99497 and 99498 could be appropriately provided
by physicians or using a team-based approach where ACP would be
provided by physicians, non-physician practitioners (NPPs), and other
staff under the order and medical management of the beneficiary's
treating physician or treating practitioner. To provide clarity on who
could report the new codes, we noted that the CPT code descriptors
described the services as furnished by physicians or other qualified
health professionals, which for Medicare purposes, has been consistent
with allowing these codes to be billed by the physicians and NPPs whose
scope of practice and Medicare benefit category include the services
described by the CPT codes and who are authorized to independently bill
Medicare for those services. Therefore, we finalized that only these
practitioners may report CPT codes 99497 and 99498, and ``incident to''
rules in Sec. 410.26 would apply when these services would be provided
incident to the services of the billing practitioner under a minimum of
direct supervision. We stated that we expected the billing physician or
NPP, in addition to providing a minimum of direct supervision, to
manage, participate and meaningfully contribute to the provision of the
services. Also, we noted that PFS payment rules would apply when ACP is
furnished incident to other physicians' services, including where
applicable, that State law and scope of practice must be met (80 FR
70959). Accordingly, even though CPT codes 99497 and 99498 describe
(and are valued as) services performed only by the billing
practitioner, we finalized a policy allowing the time of clinical staff
to be included since we did not have G codes at that time that would
have provided coding specific to that situation.
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\111\ CPT Codebook 2026, AMA, page 61.
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b. Proposals for CY 2027
Since 2016, we have heard from interested parties that ACP services
may be under-utilized because some practitioners believe that only time
they personally spend can count. While growth in ACP services
utilization has been increasing, interested parties have communicated
to CMS that the increase in utilization is not commensurate with the
need for ACP services. Utilization of ACP services has increased since
2016 from about 650,000 services to about 2.5 million per year in 2025.
We note that for patients in critical care, advance care planning is
bundled into payment for the critical care service codes (CPT codes
99291-2) and is therefore not separately billed, so these patients may
receive ACP services that is not identifiable in the claims data. We
believe that new coding could more accurately distinguish and value the
work of the billing practitioners from time that is spent by their
clinical staff in the provision of ACP services. Therefore, we are
proposing to create two new HCPCS codes to describe ACP services
furnished by clinical staff under the direct supervision of the billing
physician or other practitioner (and incidental to their professional
services), and proposing that the existing CPT codes 99497 and 99498
would only be used to report time personally spent by the billing
practitioner. The proposed new codes would be: HCPCS G-code GACP1
(Advance care planning including the explanation and discussion of
advance directives such as standard forms (with completion of such
forms, when performed), first 20 minutes of clinical staff time with
the patient, family member(s), surrogate directed by a treating
physician or other treating qualified health care professional) and
GACP2 (Advance care planning including the explanation and discussion
of advance directives such as standard forms (with completion of such
forms, when performed), each additional 20 minutes with the patient,
family member(s), surrogate directed by a treating physician or other
treating qualified health care professional (List separately in
addition to code for primary procedure)).
We are proposing a work RVU of 1.00 for HCPCS code GACP1, based on
a crosswalk to the work time of CPT code 99490 (Chronic care management
services with the following required elements: multiple (two or more)
chronic conditions expected to last at least 12 months, or until the
death of the patient, chronic conditions that place the patient at
significant risk of death, acute exacerbation/decompensation, or
functional decline, comprehensive care plan established, implemented,
revised, or monitored; first 20 minutes of clinical staff time directed
by a physician or other qualified health care professional, per
calendar month). For direct PE, we are proposing 20 minutes of clinical
labor (L037D) in the service period. We are proposing a work RVU of 0.7
for HCPCS code GACP2, based on a crosswalk to the work time of CPT code
99439 (Chronic care management services with the following required
elements: multiple (two or more) chronic conditions expected to last at
least 12 months, or until the death of the patient, chronic conditions
that place the patient at significant risk of death, acute
exacerbation/decompensation, or
[[Page 43949]]
functional decline, comprehensive care plan established, implemented,
revised, or monitored; each additional 20 minutes of clinical staff
time directed by a physician or other qualified health care
professional, per calendar month (List separately in addition to code
for primary procedure)). For direct PE, we are proposing 20 minutes of
clinical labor (L037D) in the service period.
Under this proposal, the new G codes and CPT codes 99497 and 99498
could be reported together, if time thresholds by the billing
practitioner and clinical staff were each met with these respective
code sets. We are seeking public comment on whether it would be better
for the new G codes to represent, and be valued for, the combined time
of a billing practitioner and their clinical staff within a single
code, in case, for example, the billing practitioner and staff did not
meet time thresholds for separate reporting of their respective times,
but might meet the threshold for a code combining their time. For both
the existing codes (describing physician time but allowing use for
clinical staff time, as discussed previously) and newly proposed ACP
codes (describing clinical staff time) to be paid ``incident to,'' the
reporting practitioner must furnish a prior professional service to
which the services of the clinical staff are incidental, such as a
prior E/M visit or ACP services personally performed by the billing
practitioner the same day. Our manual provides that ``[s]uch a service
or supply could be considered to be incident to when furnished during a
course of treatment where the physician performs an initial service and
subsequent services of a frequency which reflect his/her active
participation in and management of the course of treatment'' (Medicare
Benefit Policy Manual, Chapter 15, Section. 60.1.B, available at
https://www.cms.gov/regulations-and-guidance/guidance/manuals/downloads/bp102c15.pdf). We are seeking clarity from interested parties
about whether these ``incident to'' criteria (the requirement for the
billing practitioner to perform initial and subsequent services
reflecting their participation in and management of the course of
treatment) are typically met for beneficiaries needing ACP services, by
a separately billed E/M visit (whether the same day as the ACP services
or prior), or might best be included in a new code inclusive of
combined time spent by both a reporting practitioner and their clinical
staff. If the billing practitioner is by definition participating and
managing by performing part of the ACP code itself, there would not be
a need to require a prior initiating visit as we do for care management
services provided ``incident to.'' To help us craft new coding in a
manner that reflects typical clinical practice as well as ``incident
to'' rules governing payment for services by clinical staff, we are
seeking public comments that specify or clarify for the alternative new
coding, the typical care team structure; how much time is typically
spent by the billing practitioner and spent by their staff, and when;
and the clinical circumstances of patients, for example, the care
settings and whether the patient is typically a well patient or is
doing advance care planning in conjunction with a particular illness.
This would inform how the coding structure reflects work that is
personally performed by the billing practitioner in conjunction with
ACP.
Medicare has not made a national coverage determination regarding
ACP services; however, we note that in 2021 a Medicare Administrative
Contractor made a Local Coverage Determination, revised in 2023.
Contractors remain responsible for local coverage decisions in the
absence of a national Medicare policy. We also note that direct
supervision may be satisfied by audio visual technology. Furthermore,
for CY 2027 we are proposing to add both HCPCS codes GACP1 and GACP2 to
the Medicare Telehealth list.
Finally, we note that we are aware of additional factors beyond the
scope of this rule that could be influencing uptake of the existing
codes. Among these are: practitioner training for bringing ACP up for
voluntary discussion, how to ensure that care planning that includes
delineation of patient goals, preferences and advance directives are
available and actionable at the point of care (especially emergency
care), enabling interoperable access to ACP information, lowering out-
of-pocket costs for ACP services, and new quality measure that best
capture meaningful ACP conversations and documented preferences.
2. Request for Information (RFI) on Community-Based Palliative Care
a. Background
In the FY 2027 Hospice proposed rule, CMS solicited comment on the
development of community-based palliative services outside of the
hospice benefit (90 FR 17360). By community-based palliative care, we
are broadly considering where palliative services can be delivered
outside of the hospital, in outpatient clinics, in patients' homes, and
other non-hospital settings. In this request for information we sought
feedback on whether current evaluation and management (E/M) services,
care management services, and ACP services reflected current billing
and payment practices for physicians and other health professionals
delivering palliative services, as well as on whether challenges in
meeting documentation requirements, issues with compliance, or
enhancements to current services could be considered to better enhance
palliative care service delivery. In addition, in the 2027 ESRD
proposed rule, concurrently, we are requesting information to advance
payment policy and better understand the differences between
maintenance dialysis and dialysis delivered in a comfort-focused
context. Comments regarding either of these subjects are best delivered
to their respective rules.
In coordination with these requests for information, we are
additionally seeking comment on the specific requirements we should
consider given the prior CMS Innovation Center model tests focused on
complex and serious illness care. The evaluation findings from these
prior tests are best summarized in the CMS Innovation Center white
paper on `Palliative care projects: Synthesis of Evaluation Results
2012-2021'.\112\ These results indicate that a comprehensive approach
to palliative care services, including access to interdisciplinary
teams, home visits, and shared-decision-making may improve care for
Medicare beneficiaries.
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\112\ https://www.cms.gov/priorities/innovation/data-and-reports/2022/palliative-care-synthesis-2012-2021.
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We continue to prioritize reducing fraud, waste, and abuse
throughout CMS programs, and have prioritized reducing fraud, waste,
and abuse in hospice programs. While hospice care is not palliative
care, in related disciplines and sites of care we are very interested
in how to better address fraud, waste, and abuse.
Where should CMS focus on potential fraud, waste, and abuse in
community-based palliative care? Please support your statements with
peer-reviewed evidence or evidence from your institution with
sufficient detail for review.
b. Eligibility for Serious Illness Care
Defining which beneficiaries are eligible for serious illness care
is a principal challenge in palliative and supportive care. While many
Medicare beneficiaries may benefit from additional supportive care to
manage pain and symptom burden, understanding which beneficiaries
[[Page 43950]]
should be eligible for this service is of central importance to
Medicare. For example, complex chronic care management services require
two or more chronic conditions placing the beneficiary at high risk for
hospitalization, decline, or death, and requires moderate to high
complexity medical decision-making. To elect the Medicare Hospice
Benefit, two or more physicians must certify a beneficiary is within 6
months to the end of their life (or, if a beneficiary does not have an
attending physician, then the hospice physician alone is permitted to
provide the certification).
We are requesting feedback on eligibility and care management
services, and for all comments please support your statements with
peer-reviewed evidence or evidence from your institution (in sufficient
detail for review):
For any future supportive or palliative care service for
Medicare beneficiaries, should eligibility be restricted to
certification of a likely life expectancy duration?
If eligibility is restricted to those beneficiaries with a
terminal prognosis, is there evidence to suggest a reasonable interval
(that is, less than 1 year of life expectancy as in some States'
Medicaid programs)?
c. Eligibility for Palliative Services
Defining eligibility for palliative services beyond the potential
criterion of a terminal prognosis is likely necessary to better
understand who is eligible for serious illness care.\113\ While for
complex care management services we restrict eligibility to
beneficiaries requiring moderate to complex medical decision making as
well as a count of chronic conditions, common definitions of serious
illness include not just chronic condition counts but also indicators
of the impact on a person's daily function or excessive caregiver
strain.\114\
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\113\ Kelley AS, Covinsky KE, Gorges RJ, McKendrick K, Bollens-
Lund E, Morrison RS, Ritchie CS. Identifying Older Adults with
Serious Illness: A Critical Step toward Improving the Value of
Health Care. Health Serv Res. 2017 Feb;52(1):113-131. doi: 10.1111/
1475-6773.12479. Epub 2016 Mar 18. PMID: 26990009; PMCID:
PMC5264106.
\114\ https://pmc.ncbi.nlm.nih.gov/articles/PMC5756466/pdf/jpm.2017.0548.pdf.
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We are requesting feedback on the following:
For any future supportive or palliative care service for
Medicare beneficiaries, how could we consider impact on the daily
functions of life or activities of daily living as part of who is
eligible for the service?
Would eligibility best be based on impact on daily
function, on caregiver strain, or both?
How can we avoid overly burdensome requirements for
defining eligibility for services?
d. The Future of the Care Management Services
In section II.E. of this proposed rule, we are explicitly
reconsidering the future of the care management services that form the
basis for payment adequacy for important between visit care (in
addition to E/M services for outpatient or home visits). Care for the
seriously ill involves interdisciplinary care teams and involves even
greater coordination and between visit care than primary care
services.\115\
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\115\ https://www.capc.org/toolkits/building-and-supporting-effective-palliative-care-teams/.
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We are requesting feedback on the following:
How should we differentiate the care management
requirements for seriously ill beneficiaries from other Medicare
beneficiaries?
What are the essential service elements that must be
included? For example(s), continuity with a designated team member,
access to timely clinical support, comprehensive symptom and caregiver
assessment, electronic care plans, coordination with treating
physicians, patient/caregiver education, timely follow up after ED/
discharge. What other service elements should be included? Should any
not be included?
e. Advanced Primary Care Management
Currently, for Advanced Primary Care Management (APCM) services
(HCPCS codes G0556 through G0558), we require physicians to report to
the MIPS Value Pathway for primary care as part of our safeguards for
high quality primary care. If we elect to develop additional care
management services for seriously ill beneficiaries, however we may
define serious illness in the future, determining how best to report
quality of care safeguards will be essential to ensure high quality
care delivery.
We are requesting feedback on the following:
Should care management services for seriously ill
beneficiaries also require reporting to a MIPS Value Pathway? Which
quality measures should be reasonably included?
If no viable MIPS Value Pathway reporting mechanism is
found, what are the essential quality elements required for palliative
care management? Is sole reporting of ambulatory palliative care
patients feeling heard and understood (CBE 3665) sufficient? Should
other measures be considered?
3. Request for Information on Intensive Lifestyle Interventions To Slow
Progression of Alzheimer's Disease
a. Background
In the CY 2026 Physician Fee Schedule proposed rule, CMS sought
comment in a `Prevention and Management of Chronic Disease' Request for
Information (90 FR 32507), addressing management and self-management of
chronic disease, services that address root causes of disease, social
isolation and loneliness, improving physical activity, intensive
lifestyle interventions, enhancing uptake of the annual wellness visit
(AWV), supporting partnerships with AAAs and community care hubs, and
addressing motivational interviewing and health coaching. For some
topics, responses were of adequate depth for CMS to consider further
action, addressed elsewhere in this rule, but as is not uncommon when
CMS requests information across a broad range of topics, in other areas
responses were limited in the depth and granularity necessary for CMS
to address the resource costs to establish coding and payment options.
Because of the overwhelming priority for CMS to support the aging
processes, given that American older adults commonly cite their fear of
Alzheimer's as an even greater health related fear than the development
of cancer,\116\ and the growing evidence base for using lifestyle
changes to slow the progression of cognitive decline and the
development of Alzheimer's disease and Alzheimer's disease-related
dementias (AD/ADRD), CMS is requesting additional information to better
understand the resource costs and requirements for developing intensive
lifestyle interventions to reduce the risk of AD/ADRD for Medicare
beneficiaries. Intensive lifestyle interventions would be in concert
with but would not specifically include risk factor reduction in
modifiable behaviors such as controlling contributing conditions (for
example, hypertension, diabetes), eliminating tobacco use (in any
form), and addressing hearing loss.\117\ In other
[[Page 43951]]
countries, there is randomized controlled trial evidence that multi-
domain approaches can slow cognitive decline amongst at-risk older
adults,\118\ which appear to be superior to individual domain
interventions such as physical activity programming or diet
changes.\119\ In the U.S. there have also been a number of studies
demonstrating the potential impact of diet changes on cognition (for
example, the MIND trial demonstrated improved cognition for both groups
undergoing diet changes, however one diet was not shown to be
superior).12 13 14 120 To support high-value care, the payer
assuming financial risk for an individual's health would do so over a
long-term to give that payer an incentive to invest in high-value care
that reduces health care costs over that long-term. As discussed in the
recent HHS Notice of Benefit and Payment Parameters for 2027,\121\
creating these incentives for payers throughout the healthcare system
is an HHS priority. Outside of these needed incentives exists Medicare
fee-for-service, which has historically employed price-setting regimes
that are not market-based and are slow to change with improvements and
health innovations. As HHS continues to improve incentives for private
payers to invest in preventive health care, we are interested in how to
ensure fee-for-service Medicare is similarly able to benefit from
better incentives to invest in high-value care.
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\116\ Ornish, Dean, et al. ``Effects of Intensive Lifestyle
Changes on the Progression of Mild Cognitive Impairment or Early
Dementia Due to Alzheimer's Disease: A Randomized, Controlled
Clinical Trial.'' Alzheimer's Research & Therapy, vol. 16, 2024, p.
122. https://link.springer.com/article/10.1186/s13195-024-01482-z.
\117\ National Institute on Aging. ``Cognitive Health and Older
Adults.'' National Institutes of Health, https://www.nia.nih.gov/health/brain-health/cognitive-health-and-older-adults. Accessed 30
Apr. 2026.
\118\ Ngandu, Tiia, et al. ``A 2 Year Multidomain Intervention
of Diet, Exercise, Cognitive Training, and Vascular Risk Monitoring
versus Control to Prevent Cognitive Decline in At-Risk Elderly
People (FINGER): A Randomised Controlled Trial.'' The Lancet, vol.
385, no. 9984, 2015, pp. 2255-2263. https://doi.org/10.1016/S0140-6736(15)60461-5.
\119\ ``2024 Lancet Commission Underscores the Potential for
Dementia Risk Reduction, Identifying 14 Modifiable Risk Factors
across the Life Course.'' Alzheimer Europe, 31 July 2024, https://www.alzheimer-europe.org/news/2024-lancet-commission-underscores-potential-dementia-risk-reduction-identifying-14-modifiable.
\120\ Barnes, Lisa L., et al. ``Trial of the MIND Diet for
Prevention of Cognitive Decline in Older Persons.'' The New England
Journal of Medicine, vol. 389, no. 7, 2023, pp. 602-611. https://www.nejm.org/doi/10.1056/NEJMoa2302368.
\121\ https://www.govinfo.gov/content/pkg/FR-2026-05-20/pdf/2026-10050.pdf
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To better understand resource costs associated with intensive,
multi-domain interventions:
Given the discussion of the evidence to date on the
effectiveness of intensive lifestyle interventions for CMS to pursue,
we are particularly interested in demonstrations of cost-savings
associated with these and other interventions. Please cite any evidence
available in your discussion.
Given CMS' concern for addressing fraud, waste, and abuse
throughout the Medicare program, please comment on any potential or
observed FWA in diagnosis, treatment, or management of AD/ADRD.
Given the emerging role of biomarker diagnostic testing
(for example, p-tau217, et. al) for AD/ADRD leading to early diagnosis,
please provide any evidence supporting earlier detection and its role
in supporting improving AD/ADRD care and any potential role in
identifying eligibility for an intensive lifestyle intervention focused
on AD/ADRD.
What are the essential domains to address in a multi-
domain intensive lifestyle intervention to reduce the risk of cognitive
decline for older adults at risk for developing AD/ADRD that would be
appropriate to include under Medicare?
Should these interventions be made available as a one-time
service (that is, to teach older adults how to make changes in their
lifestyle to help reduce AD/ADRD risk) or on a recurring (for example,
annual) basis?
Should the eligibility for these services be restricted to
beneficiaries with a diagnosis of mild cognitive impairment (MCI), or
early-stage dementia? If so, how should this diagnosis be made or
confirmed?
Respondents to the general intensive lifestyle intervention
question in the prior RFI focused on the differentiation between
intensive lifestyle interventions (ILIs) and intensive behavioral
therapy (IBT) where ILIs are more multi-domain, longitudinal, and
comprehensive and typically incorporate a multi-disciplinary team and
are delivered in a community setting, and noting these are needed
flexibilities that current IBT coding does not currently accommodate.
To better understand the resource costs and requirements for future AD/
ADRD ILI services:
Given ILI's are multi-domain, and likely include physical
activity, nutrition, potentially additional domains such as sleep and
stress management, who are the essential interdisciplinary team members
that CMS should account for in developing appropriate resource costs
for future services?
How should supervision be determined for AD/ADRD ILI's? Is
general supervision sufficient for ensuring clinical safety and
oversight? Is direct supervision required?
While there are many variations of ILI's focusing on AD/ADRD that
are delivered, the essential `dose' of intervention or minimum
frequency and duration of a future service, as well as the modality
(that is, must this intervention be delivered purely in person, can it
be delivered virtually) are all important to consider:
What is the minimum frequency of sessions for an AD/ADRD
ILI per week? What is the minimum number of weeks that will be
necessary?
Should CMS require a future AD/ADRD ILI to be delivered in
person? Can it be delivered virtually?
Finally, while we are currently accepting applications for a CMS
Innovation Center payment model to generate evidence associated with
lifestyle interventions (MAHA ELEVATE),\122\ including potentially
intensive lifestyle interventions focused on reducing risk and/or
slowing progression of AD/ADRD, currently CMS has no endorsement
process for specific interventions. In development of the CMS Health
Technology Ecosystem \123\ and the library of applications:
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\122\ Centers for Medicare & Medicaid Services. ``MAHA ELEVATE
(Make America Healthy Again: Enhancing Lifestyle and Evaluating
Value-Based Approaches Through Evidence) Model.'' CMS.gov, 2026,
https://www.cms.gov/priorities/innovation/innovation-models/maha-elevate.
\123\ Centers for Medicare & Medicaid Services. ``Health
Technology Ecosystem.'' CMS.gov, https://www.cms.gov/priorities/health-technology-ecosystem/overview. Accessed 30 Apr. 2026.
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How should CMS support the development of our Health
Technology Ecosystem to support older adults reducing their risk for
developing AD/ADRD using intensive lifestyle changes?
Please note, this is a request for information (RFI) only. In
accordance with the implementing regulations of the Paperwork Reduction
Act of 1995 (PRA), specifically 5 CFR 1320.3(h)(4), this general
solicitation is exempt from the PRA. Facts or opinions submitted in
response to general solicitations of comments from the public,
published in the Federal Register or other publications, regardless of
the form or format thereof, provided that no person is required to
supply specific information pertaining to the commenter, other than
that necessary for self-identification, as a condition of the agency's
full consideration, are not generally considered information
collections and therefore not subject to the PRA.
H. Current Procedural Terminology (CPT) Request for Information (RFI)
The Current Procedural Terminology (CPT[supreg]) coding system is
owned and copyrighted by the American Medical Association (AMA) and CMS
uses CPT[supreg] under a royalty-free licensing agreement with the
AMA.\124\ The CPT[supreg] coding
[[Page 43952]]
system was introduced by the AMA in 1966,\125\ in part to ``encourage
the use of standard terms and descriptors to document procedures in the
medical record'' and ``help communicate accurate information on
procedures and services to agencies concerned with insurance claims,''
and it ``provided the basis for a computer oriented system to evaluate
operative procedures and contributed basic information for actuarial
and statistical purposes.'' \126\ The CPT[supreg] coding system went
through a series of early version changes and in 1977 the AMA
established the CPT-4 or 4th edition which established the current
five-digit numeric structure of the CPT[supreg] coding system still
used today.\127\ The Health Care Financing Administration or HCFA,
later renamed CMS,\128\ in 1983 required the use of the Healthcare
Common Procedure Coding System (HCPCS) for physician services and
expanded to non-physician services in 1991.\129\ and since this time
HCPCS Level I services have been considerd synonymous with CPT, where
Level II HCPCS refers to additional products, supplies, and services
not included in the CPT[supreg] codes.\130\
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\124\ Centers for Medicare & Medicaid Services. AMA Terms and
Conditions. Centers for Medicare & Medicaid Services, n.d., https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNEdWebGuide/Downloads/AMA-Terms-Conditions.pdf.
\125\ American Medical Association. History of CPT[supreg]
Content. American Medical Association, 5 Dec. 2025, https://www.ama-assn.org/practice-management/cpt/history-cpt-content.
\126\ American Medical Association. The Purpose of the
CPT[supreg] Coding System & the CPT[supreg] Editorial Panel.
American Medical Association, 10 Sept. 2025, https://www.ama-assn.org/about/cpt-editorial-panel/purpose-cpt-coding-system-cpt-editorial-panel.
\127\ American Medical Association. The Purpose of the
CPT[supreg] Coding System & the CPT[supreg] Editorial Panel.
American Medical Association, 10 Sept. 2025, https://www.ama-assn.org/about/cpt-editorial-panel/purpose-cpt-coding-system-cpt-editorial-panel.
\128\ Centers for Medicare & Medicaid Services, Department of
Health and Human Services. Statement of Organization, Functions, and
Delegations of Authority. Federal Register, 5 July 2001, https://www.federalregister.gov/documents/2001/07/05/01-16800/centers-for-medicare-and-medicaid-services-statement-of-organization-functions-and-delegations-of.
\129\ Medicare Program; Fee Schedule for Physicians' Services;
Proposed Rule. Federal Register, vol. 56, no. 108, 5 June 1991, pp.
25792-25978. U.S. Government Publishing Office, https://www.govinfo.gov/content/pkg/FR-1991-06-05/pdf/FR-1991-06-05.pdf
\130\ Centers for Medicare & Medicaid Services. ``Healthcare
Common Procedure Coding System (HCPCS).'' Centers for Medicare &
Medicaid Services, U.S. Department of Health and Human Services,
https://www.cms.gov/medicare/coding-billing/healthcare-common-procedure-system. Accessed 7 July 2026.
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Following the passage of the Health Insurance Portability and
Accountability Act of 1996 (HIPAA) the Department of Health and Human
Services (HHS) in subsequent regulation defined the combination of
HCPCS, as maintained and distributed by HHS, and CPT-4, as maintained
and distributed by the AMA, as the nationally required medical data
code sets for physician services, physical and occupational therapy
services, radiologic procedures, clinical laboratory tests, other
medical diagnostic procedures, hearing and vision services, and
transportation services including ambulance services (45 CFR
162.1002(a)(5)). This is commonly understood as a regulatory
requirement for CPT-4 codes to be used to define physician services.
While this is HHS' current regulatory interpretation of the HIPAA (Pub.
L. 104-191), it is important to note that HHS has only specified in
regulation that HCPCS and CPT-4 to be used in combination. There is no
specification in the HIPAA statute regarding the manner in which these
national coding sets may be used or how they may be combined, and only
HHS interpretation, not the Act itself, mentions CPT[supreg].
New CPT[supreg] codes are introduced by the CPT[supreg] Advisory
Committee. This committee was established following the initial
publication of the CPT[supreg] coding system in 1966, which provides
advice on procedure coding and appropriate nomenclature as relevant to
the committee member's specialty and consists of ``members of national
medical specialty societies seated in the AMA House of Delegates.''
\131\ When a new CPT[supreg] code is defined by the CPT[supreg]
Advisory Committee, it is then assigned a payment value by the AMA
Relative Value Scale Update Committee or RUC.\132\
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\131\ American Medical Association. CPT[supreg] Nominations &
Opportunities. American Medical Association, 11 Feb. 2025, https://www.ama-assn.org/about/cpt-editorial-panel/cpt-nominations-opportunities.
\132\ American Medical Association. RVS Update Committee (RUC).
American Medical Association, 4 Mar. 2026, https://www.ama-assn.org/about/rvs-update-committee-ruc/rvs-update-committee-ruc.
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The AMA RUC was established in 1992, after CMS transitioned to the
resource-based relative value scale (RBRVS) to provide recommendations
on the valuation of physician services. As established in section 1848
of the Act, CMS began paying for physician services in 1998 on the
basis of a product of the relative value of the physician service,
incorporating the physician work, the practice expense, and the
malpractice component. These elements form the basis for the RBRVS. The
components of physician services were originally established by a team
of Harvard researchers (William Hsiao, et al.) and CMS has occasionally
referenced the `Harvard' valuations making reference to these original
contributions.\133\ According to the AMA, the AMA RUC ``provides
medicine a voice in shaping Medicare relative values,'' and by all
published estimates this has been an effective mechanism.\134\
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\133\ Hsiao WC, Braun P, Kelly NL, Becker ER. Results, Potential
Effects, and Implementation Issues of the Resource-Based Relative
Value Scale. JAMA. 1988;260(16):2429-2438. doi:10.1001/
jama.1988.03410160105013.
\134\ American Medical Association. RVS Update Committee (RUC).
American Medical Association, 4 Mar. 2026, https://www.ama-assn.org/about/rvs-update-committee-ruc/rvs-update-committee-ruc.
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There has also been longstanding concern expressed over the Federal
reliance on a private organization with such an obvious conflict of
interest as providing information on the time and resource requirements
to conduct physician services when this information may influence their
own payment. For nearly 20 years, MedPAC has expressed concern over the
influence of the AMA RUC to value services, specifically noting that
CMS has ``over-relied on specialty societies with a financial stake in
the process'' and has recommended that CMS establish a separate group
of experts to make payment recommendations.\135\ Further, we note the
historic reliance on the CPT and RUC process as a potential contributor
to the development of US health care as a `sick care` system with
limited emphasis on prevention and lifestyle modifications and which
may inhibit progress on the Secretarial priority to Make America
Healthy Again. Additionally, we note a recent National Academies of
Sciences, Engineering, and Medicine (NASEM) report recommending RUC
alternatives for establishing primary care payment valuation and
recommendations for alternative sources for data collection.\136\
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\135\ Medicare Payment Advisory Commission. Testimony: Options
to Improve Medicare's Payments to Physicians. 8 May 2007, https://www.medpac.gov/wp-content/uploads/import_data/scrape_files/docs/default-source/congressional-testimony/051007_Testimony_MedPAC_physician_payment.pdf.
\136\ National Academies of Sciences, Engineering, and Medicine.
Improving Primary Care Valuation Processes to Inform the Physician
Fee Schedule. National Academies Press, 2025, https://doi.org/10.17226/29069.
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Given these longstanding concerns, we are seeking comment on a
number of areas regarding the influence of the CPT[supreg] coding
system and AMA process on physician payment policy as part of the
Secretarial priority to Make America Healthy Again.
(1) What, if any, evidence is there for CMS to consider regarding
the harms or
[[Page 43953]]
challenges associated with AMA's monopoly over CPT-4 licenses for
health care entities? Please cite potential improvements to patient
care diverted or delayed due to AMA'S monopoly over CPT codes,
including inhibited innovations and acquisition or maintenance costs of
CPT[supreg] licensure.
(2) What, if any, evidence is there that the generation of CPT-4
codes follows a process of identification of medical necessity? What
opportunities or examples from other populations, sites of care, or
international health systems could instruct a process of identification
of medical necessity in the CPT-4 code development process?
(3) A combination of CPT-4 and HCPCS codes were formally adopted by
HHS as the legal standard for national coding for physician and other
services as part of implementing HIPAA (45 CFR 162.1002(a)(5)). If CMS
were to revisit this standard in future rulemaking, which if any
alternatives exist to CPT-4 for CMS to consider as part of the national
coding standard for physician services? Would CMS need to specify a
separate legal standard, or could CMS allow for private competition to
supplement the existing CPT-4 coding standard?
(4) What objective alternatives exist, or could be developed, to
maintain a more objective process to the current AMA CPT and RUC
committee processes? How would these alternatives support or inhibit
innovation?
(5) What are the benefits and drawbacks of paying for physician
procedural services on the basis of the underlying International
Classification of Diseases, 10th Revision (ICD-10) procedure code, as
an alternative to CPT-4 code? How could the International
Classification of Diseases, 10th Revision, Procedure Coding System
(ICD-10-PCS) services be grouped or bundled into payment categories,
similar to Medicare Severity Diagnosis Related Groups (MS-DRGs), or
Outpatient Prospective Payment System (OPPS) Ambulatory Payment
Classifications (APCs)? What other alternatives exist for bundling or
grouping procedural services?
III. Other Provisions of the Proposed Rule
A. Drugs and Biological Products Paid Under Medicare Part B
1. Requiring Manufacturers of Certain Single-Dose Container or Single-
Use Package Drugs To Provide Refunds With Respect to Discarded Amounts
(Sec. Sec. 414.902 and 414.940)
a. Background
Section 1847A(h) of the Act requires manufacturers to provide a
refund to CMS for certain discarded amounts from a refundable single-
dose container or single-use package drug (hereinafter referred to as
``refundable drug'') for calendar quarters beginning January 1, 2023.
The calculation of the refund is codified at Sec. 414.940(c). For
a new refund quarter (as defined at Sec. 414.902) beginning on or
after January 1, 2023, an amount equal to the estimated amount (if any)
by which:
The product of the total number of units of the billing
and payment code for such drug that were discarded during such new
refund quarter; and the amount of payment determined for such drug or
biological under section 1847A(b)(1)(B) or (C) of the Act, as
applicable, for such new refund quarter.
Exceeds an amount equal to the applicable percentage of
the estimated total allowed charges for such drug for the new refund
quarter.
Section 1847A(h)(3)(B)(i) of the Act establishes an applicable
percentage of 10 percent, but provides that, in the case of a
refundable drug that has unique circumstances involving similar loss of
product as that described in section 1847A(h)(8)(B)(ii) of the Act, the
Secretary, through notice and comment rulemaking, may increase such
applicable percentage as determined appropriate by the Secretary.
Section 1847A(h)(8)(B)(ii) of the Act describes a drug or biological
approved by the Food and Drug Administration (FDA) for which dosage and
administration instructions included in the labeling require filtration
during the drug preparation process, prior to dilution and
administration, and require that any unused portion of such drug after
the filtration process be discarded after the completion of such
filtration process. Drugs with an increased applicable percentage are
listed on the CMS website.\137\
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\137\ https://www.cms.gov/medicare/payment/part-b-drugs/discarded-drugs.
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For previous rulemaking in which we finalized to increase the
applicable percentage of a drug with unique circumstances involving
similar loss of product as that described in section 1847A(h)(8)(B)(ii)
of the Act, we explained specifically why the loss of product met the
statutory requirements. In the CY 2023 Physician Fee Schedule (PFS)
final rule (87 FR 69729), we finalized an increase in the applicable
percentage for a drug reconstituted with a hydrogel and administered
via ureteral catheter or nephrostomy tube into the kidneys, where a
substantial amount of reconstituted hydrogel adheres to the vial wall
during preparation and cannot be withdrawn for administration. Because
this unavoidable preparation-related loss is similar to the loss
described in section 1847A(h)(8)(B)(ii) of the Act, we stated that such
a drug that is reconstituted with a hydrogel and has variable dosing
based on patient-specific characteristics (for example, Jelmyto[supreg]
(mitomycin for pyelocalyceal solution)) should be considered to have
unique circumstances as described in section 1847A(h)(3)(B)(ii) of the
Act that would warrant an increased applicable percentage.
In the CY 2024 PFS final rule (88 FR 79052), we increased the
applicable percentage for certain drugs with low volume doses and
stated that such drugs have unique circumstances because certain FDA-
labeled amounts on the vial or package are unused and discarded after
administration of the labeled dose and these amounts are not available
to be administered. The unique circumstances described for such drugs
are similar to loss of product from filtration described in section
1847A(h)(8)(B)(ii) of the Act because in both circumstances, such
amounts lost are amounts that are not part of the recommended dose and
are not available to be administered to the patient (one being loss due
to labeled amounts remaining in the filter and the other due to labeled
amounts remaining in other areas such as the vial or syringe).
In the CY 2024 PFS final rule, we also finalized an increased
applicable percentage for certain orphan drugs furnished to fewer than
100 unique beneficiaries per calendar year. We explained (88 FR 79053
through 79057) that because of the substantial statistical variation
(based on demonstrated JW modifier claims data from 2021 and 2022) from
quarter to quarter for such drugs, we believe it would be difficult to
optimize the presentation of the drug to consistently minimize the
discarded amounts to less than 10 percent given the small number of
patients receiving the drug. We considered the higher percentage of
unused and discarded amounts from such drugs as
[[Page 43954]]
unavoidable loss due to both the low number of unique beneficiaries
receiving the drug contributing statistically higher variability in
discarded amounts. Also, due to the low numbers of patients available
to study for rare disease, it may be more difficult to determine the
most efficient vial size for the patient population who receive the
drug post-marketing. We stated this is similar to the loss of product
due to filtration described in section 1847A(h)(8)(B)(ii) of the Act
because the loss is unavoidable in both circumstances. In the case of
filtration described in statute, the loss is unavoidable because
certain amounts of product will be left within the filter and
unavailable for administration; in the case of rarely utilized orphan
drugs, the loss is unavoidable because of the variability of potential
doses (and low number of patients receiving the drug) leading to an
inability to develop a package size that will result in a consistent
average percentage of discarded units.
We stated in the CY 2024 PFS final rule (88 FR 79057) that we do
not consider the following to be unique circumstances warranting an
increased applicable percentage at this time: weight-based doses, body
surface area (BSA)-based doses, varying surface area of a wound,
loading doses, escalation or titration doses, tapering doses, and dose
adjustments for toxicity because we believe manufacturers can optimize
the availability of products for these circumstances to limit the
percentage of discarded units for a drug, unlike the circumstances of
manufacturers of drugs that require filtration during the preparation
process, as described in section 1847A(h)(8)(B)(ii) of the Act.
We also explained in the CY 2024 PFS final rule (88 FR 79060) that,
while we cannot anticipate future drug development or what unique
circumstances might arise, we can offer our analysis of the unique
circumstances we consider involving similar loss of product as that
described in section 1847A(h)(8)(B)(ii) of the Act for drugs that are
reconstituted in hydrogel and with variable dosing based on patient-
specific characteristics (87 FR 69727 through 69731), drugs with low
volume doses, and rarely utilized orphan drugs (88 FR 79052 through
79057). Regarding examples of evidence, we noted minimum vial fill
studies and dose preparation studies in the CY 2024 PFS proposed rule,
both of which are suitable for justifying increased applicable
percentages because they can establish that certain unusable amounts of
a product are necessarily included in a container to safely and
consistently administer the labeled therapeutic dose to a patient.
b. Application for Increased Applicable Percentage
Section 1847A(h)(3)(B)(ii) of the Act permits the Secretary to
increase the applicable percentage for a refundable drug that has
unique circumstances through notice-and-comment rulemaking. In the CY
2024 PFS final rule (88 FR 79057 through 79060), we finalized an
application process (CMS-10835, OMB 0938-1435) by which manufacturers
can apply for an increased applicable percentage for a drug and may
request that we consider an individual drug to have unique
circumstances for which an increased applicable percentage is
appropriate. Under Sec. 414.940(e)(2), an application must be
submitted by February 1 of the CY prior to the year the increased
applicable percentage would apply; for a drug that is not FDA-approved
by February 1, the application must have FDA approval by August 1, and
the manufacturer must notify CMS and submit the FDA-approved label by
September 1 of that year. The application must include a written
request that the drug be considered for an increased applicable
percentage based on its unique circumstances; FDA-approved labeling for
the drug (or, if the drug is not approved by the February 1 application
deadline described in paragraph (e)(2) of this section, documentation
of FDA acceptance of the application for review); justification for the
consideration of an increased applicable percentage based on such
unique circumstances; and justification for the requested increase in
the applicable percentage. Following review of timely applications, CMS
will summarize its analyses of applications and propose appropriate
increases in rulemaking. If adopted, the increased applicable
percentage will be the applicable percentage beginning January 1 of the
following calendar year.
We received one application requesting an increased applicable
percentage for consideration for CY 2027 from the manufacturer of
Leukine[supreg] (sargramostim),\138\ who resubmitted a request for a 72
percent applicable percentage after applying the previous 2 years. The
applicant submitted the information required at Sec. 414.940(e)(1),
including, as applicable, FDA-approved labeling for the drug,
justification for consideration of an increased applicable percentage,
and justification for the requested applicable percentage.
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\138\ https://www.accessdata.fda.gov/drugsatfda_docs/label/2022/103362s5249lbl.pdf.
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Leukine[supreg] is a leukocyte growth factor with five FDA-approved
indications related to hematological conditions and hematopoietic
recovery, as well as one indication to increase survival following
acute exposure to myelosuppressive doses of radiation. The applicant's
submitted FDA-approved labeling for the drug does not include the
adjuvant uses described in the application (further described later in
this paragraph) due to ongoing cancer vaccine adjuvant trials. The
applicant reemphasized that multiple sponsors are in late-stage
development, with a total of 27 Phase II and Phase III clinical trials,
an increase from 22 reported in the previous year, investigating
Leukine[supreg] as a vaccine adjuvant for oncology indications,
specifically to stimulate the immune response of dendritic cells when
used alongside these vaccines. We note that cancer treatment vaccines
differ from the vaccines that protect against viruses, such as the
influenza virus. Instead of preventing disease, cancer treatment
vaccines aim to stimulate the immune system to attack existing cancer
cells in the body.\139\ The applicant stated that it has no ownership
stake in the development of these cancer treatment vaccines and does
not possess control or influence over the design and execution of the
clinical trials. The applicant further explained that the estimated
completion dates for Phase III clinical trials vary, with the earliest
expected in late 2026 140 141 and the latest in March
2029.\142\
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\139\ https://www.cancer.org/cancer/managing-cancer/treatment-types/immunotherapy/cancer-vaccines.html.
\140\ https://clinicaltrials.gov/study/NCT04229979.
\141\ https://clinicaltrials.gov/study/NCT05232916.
\142\ https://clinicaltrials.gov/study/NCT05100641.
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The adjuvant use of Leukine[supreg] in predetermined dosage is
distinct from its six FDA-approved indications, all of which have
dosages that are based on body weight or body surface area (BSA). The
adjuvant use dosages of Leukine[supreg] in clinical trials are
generally much smaller than dosages for indications in the FDA-approved
labeling. The smallest dose of Leukine[supreg] used for vaccine
adjuvant purposes of which the applicant is aware (that is, 70 mcg)
would lead to as much as 72 percent of the drug being discarded from a
single-dose 250 mcg lyophilized vial, which is the only size available
commercially. The applicant suggests that if use of these small doses
were to become more common for an approved indication, the percentage
of discarded units could
[[Page 43955]]
increase the discarded drug refund amount that could be owed by the
applicant, even though the applicant lacks control or knowledge of the
potential variability of the discarded amounts that may occur if
Leukine[supreg] were used for such purposes. The applicant notes that
if another manufacturer were to seek FDA approval for adjuvant use of
sargramostim but was not involved in its production, the available
single-dose 250-mcg vial presentation of Leukine[supreg] would likely
not be optimized for the small doses being studied in these trials. The
applicant also expresses concern about potential refund liability if
small-dose adjuvant use becomes more common.
The application builds on prior submissions by reiterating that
Leukine[supreg] appears on FDA's list of essential medicines,\143\ that
the Administration for Strategic Preparedness and Response (ASPR) has
documented a requirement to procure and stockpile Leukine[supreg] as a
medical countermeasure for neutropenia resulting from acute radiation
syndrome,\144\ and that the applicant continues to collaborate with the
Biomedical Advanced Research and Development Authority (BARDA). In this
application, the applicant also newly states that Leukine[supreg] has
been designated a ``Medical Product Priority'' by the Department of
Defense (DoD) under Public Law 115-92 (enacted December 12, 2017).\145\
DoD maintains a Medical Product Priority list as part of the DoD-FDA
coordination framework established following Public Law 115-92 and
formalized in the FDA-DoD Memorandum of Understanding.\146\ Under this
framework, DoD identifies and maintains a list of its highest-priority
medical products to support focused, recurring engagement with FDA;
however, we could not corroborate a Leukine[supreg] designation using
resources available for public review. The applicant's 2022 public
announcement of an Other Transaction Agreement with the DoD references
Leukine[supreg] as a potential medical countermeasure for sulfur
mustard gas exposure,\147\ but it does not reference a ``Medical
Product Priority'' designation. Additionally, a study published in 2025
comparing essential medicines across U.S. Federal agencies and the
World Health Organization did not identify Leukine[supreg] on DoD's
operational medicines list. The study noted that the DoD operational
medicines list is a subset of FDA's essential medicines list--meaning
medicines on the DoD list also appear on FDA's list, but not all
medicines on FDA's list appear on the DoD list.\148\ Nevertheless,
these emergency-response and preparedness-related listings or
designations do not, by themselves, demonstrate unique circumstances
related to discarded amounts for purposes of an increased applicable
percentage because they are designed to support Federal planning,
procurement, and interagency coordination to ensure adequate supply of
essential products, rather than to provide evidence of drug-specific,
unavoidable product loss similar to loss of product as described in
section 1847A(h)(8)(B)(ii) of the Act.
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\143\ https://www.fda.gov/media/143406/download?attachment.
\144\ https://sam.gov/opp/f4735f1f235847a0bb138c13333097de/view.
\145\ To amend the Federal Food, Drug, and Cosmetic Act to
authorize additional emergency uses for medical products to reduce
deaths and severity of injuries caused by agents of war, Public Law
115-92, 131 Stat. 2023 (2017).
\146\ https://www.fda.gov/about-fda/domestic-mous/mou-225-19-001.
\147\ https://www.partnertx.com/partner-therapeutics-announces-contract-with-u-s-department-of-defense-for-advanced-development-of-leukine-to-treat-sulfur-mustard-gas-hd-exposure/.
\148\ ML Janvrin, A Kanagaratnam, VA Suarez et al. A comparison
of the essential medicines lists of the U.S. Department of Health
and Human Services, the U.S. Department of Defense, the U.S. Food
and Drug Administration, and the World Health Organization, Journal
of the American Pharmacists Association, 65(5),2025.
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As part of CMS' review of the application, we analyzed existing
claims data from the first quarter of 2018 through the last quarter of
2025 and found the percentage of units discarded for Leukine[supreg]
(HCPCS code J2820) ranged from 1.1 percent to 4.9 percent, which is
below the applicable percentage of 10 percent. The quarterly discarded
percentages during this time frame were stable, with a standard
deviation of less than 1 percentage point and values tightly clustered
around a mean of approximately 2.4 percent. This is notably lower than
the 6.21 percent average standard deviation observed for rarely
utilized orphan drugs, as reported in the CY 2024 PFS final rule (88 FR
79053). Accordingly, the applicant's requested applicable percentage
relies on assumptions about hypothetical future dosing and utilization
that are not evident in Part B claims data available to date.
At the time of the CY 2026 PFS proposed rule, the impact of a
potential adjuvant indication with a type of immunotherapy commonly
referred to as cancer vaccines \149\ on the current percentage of units
discarded was uncertain. Additionally, it was not yet known whether
sargramostim would be approved for additional indications and dosages
described by the applicant, and the available data was insufficient for
CMS to determine whether Leukine[supreg] had unique circumstances
prompting an increase in the applicable percentage. Therefore, we did
not propose to increase the applicable percentage in the CY 2026 PFS
proposed rule. The applicant agreed with CMS' rationale for this
decision.
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\149\ https://www.cancerresearch.org/treatment-types/cancer-vaccines.
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Although the applicant agreed with CMS's rationale in the CY 2026
PFS proposed rule, they submitted a new application for CY 2027 with
updated information on oncology vaccine-adjuvant clinical trials and
projected timing for potential FDA approvals, as well as an asserted
DoD ``Medical Product Priority'' designation. However, the core
uncertainties identified in the CY 2026 PFS proposed rule persist: the
absence of FDA-approved labeling for the asserted adjuvant
indication(s) or dosage(s) and uncertainty regarding whether such uses
would be utilized to an extent that discarded amounts would exceed the
applicable percentage in a calendar quarter.
The existing claims data and trends for discarded amounts of
sargramostim discussed earlier do not support a determination that
Leukine[supreg] has qualifying unique circumstances that would support
an increased applicable percentage under section 1847A(h)(3)(B)(ii) of
the Act. Unlike the analysis leading to an increased applicable
percentage for certain orphan drugs as described earlier in the
Background section III.A.1.a. of this proposed rule, which relied on
evidence indicating that certain orphan drugs have unavoidable loss of
drug similar to the loss of product described in section
1847A(h)(8)(B)(ii) of the Act, the justification presented by the
applicant for an increased applicable percentage for their product is
based largely on projections regarding potential future oncology
vaccine-adjuvant use at smaller doses. These projections assume a
utilization scenario in which sargramostim use would shift
predominantly to the studied indications at the lowest study dose
discussed earlier in this section, rather than remaining primarily
under the FDA-approved indications, for which claims data currently
demonstrate very low discarded amount percentages with no trending
increase. In the absence of qualifying unique circumstances, we do not
reach the question of whether the requested applicable percentage would
be appropriate.
Accordingly, we are not proposing an increase in the applicable
percentage for
[[Page 43956]]
Leukine[supreg] for CY 2027. The applicant may reapply in a future
application cycle when more information, such as FDA-approved labeling
reflecting new indications or dosages, becomes available. We welcome
comments on the application for increased applicable percentage.
B. Rural Health Clinics (RHCs) and Federally Qualified Health Centers
(FQHCs)
1. Background on RHC and FQHC Payment Methodologies
As provided in 42 CFR part 405, subpart X of our regulations, RHC
and FQHC visits generally are defined as face-to-face encounters
between a patient and one or more RHC or FQHC practitioners during
which one or more RHC or FQHC qualifying services are furnished. RHC
and FQHC practitioners are physicians, nurse practitioners (NPs),
physician assistants (PAs), Certified Nurse Midwives (CNMs), clinical
psychologists (CPs), licensed marriage and family therapists, mental
health counselors, and clinical social workers, and, subject to certain
conditions, a registered nurse or licensed practical nurse that is
furnishing care to a homebound RHC or FQHC patient in an area verified
as having shortage of home health agencies. Transitional Care
Management (TCM) services can also be paid by Medicare as an RHC or
FQHC visit. In addition, Diabetes Self-Management Training (DSMT) or
Medical Nutrition Therapy (MNT) services furnished by a certified DSMT
or MNT program may also be considered FQHC visits for Medicare payment
purposes. Only medically necessary medical, mental health, or qualified
preventive health services that require the skill level of an RHC or
FQHC practitioner are RHC or FQHC billable visits. Services furnished
by auxiliary personnel acting under the supervision of the RHC or FQHC
practitioner, are considered incident to the visit and are included in
the per-visit payment.
RHCs generally are paid an all-inclusive rate (AIR) for all
medically necessary medical and mental health services and qualified
preventive health services furnished on the same day (with some
exceptions). The AIR is subject to a payment limit, meaning that an RHC
will not receive any payment beyond the specified limit amount per
visit. As of April 1, 2021, all RHCs are subject to statutory upper
payment limits determined in accordance with section 1833(f) of the
Act, as amended by section 130 of the Consolidated Appropriations Act,
2021 (Pub. L. 116-260).
FQHCs were paid under the same AIR methodology until October 1,
2014. Beginning on that date, in accordance with section 1834(o) of the
Act (as added by section 10501(i)(3) of the Patient Protection and
Affordable Care Act (Pub. L. 111-148, March 23, 2010)), FQHCs began to
transition to the FQHC PPS system, in which they are paid based on the
lesser of the FQHC PPS rate or their actual charges. The FQHC PPS rate
is adjusted for geographic differences in the cost of services by the
FQHC PPS geographic adjustment factor (GAF). The rate is increased by
34 percent when an FQHC furnishes care to a patient that is new to the
FQHC, or to a beneficiary receiving an initial preventive physical
examination (IPPE) or has an annual wellness visit (AWV). Section
1834(o)(2)(B)(ii) requires the FQHC PPS base rate be updated annually
by the percentage increase in a market basket of Federally qualified
health center goods and services as promulgated through regulations, or
if such an index is not available, by the percentage increase in the
Medicare Economic Index (MEI) (as defined in section 1842(i)(3)) for
the year involved. See section III.B.4 of this proposed rule, for the
proposed CY 2027 updates.
Under the general authority of section 1834(o) of the Act, CMS
codified at Sec. Sec. 405.2462 and 405.2464 to pay historically
excepted tribal FQHCs using the Medicare outpatient per visit rate
established annually by IHS, rather than the FQHC PPS rate (80 FR
71089). These rates are set by IHS under sections 321(a) and 322(b) of
the Public Health Service (PHS) Act based on prior-year cost reports.
The outpatient per visit rate applies only to provider-based IHS or
tribal facilities (Sec. 413.65(m)) and historically excepted tribal
FQHCs. For CY 2026, the rate is $733 per visit in the lower 48 States.
Both the RHC AIR and FQHC PPS payment rates were initially designed
to reflect the cost of all services and supplies that an RHC or FQHC
furnished to a patient in a single day. These nearly all-inclusive
rates are not adjusted at the individual level for the complexity of
individual patient health care needs, the length of an individual
visit, or the number or type of practitioners involved in the patient's
care. Instead for RHCs, all costs for the facility over the course of
the year are aggregated, and an AIR is derived from these aggregate
expenditures. Section 1834(o)(2)((B)(ii) of the Act requires the FQHC
PPS base rate be updated annually by the percentage increase in a
market basket of Federally qualified health center goods and services
as promulgated through regulations, or if such an index is not
available, by the percentage increase in the MEI (as defined in section
1842(i)(3)) of the Act for the year involved.
RHCs and FQHCs are also paid for non-face-to-face care management
work involved in coordinating care outside of the RHC AIR and FQHC PPS
(Sec. 405.2464(c)). That is, payment is based on the PFS national non-
facility payment rate and is made in addition to the otherwise billable
visit for patients utilizing chronic care management (CCM), principal
care management (PCM), general behavior health integration (BHI),
chronic pain management (CPM), remote physiologic monitoring (RPM),
remote therapeutic monitoring (RTM), community health integration
(CHI), principal illness navigation (PIN), PIN-peer support services,
advanced primary care management (APCM), and psychiatric collaborative
care model (CoCM). In addition, payment is based on the PFS national
non-facility payment rate and is made in addition to the otherwise
billable visit for communication technology-based services (CTBS) and
remote evaluation services (Sec. 405.2464(e)).
In the CY 2026 PFS final rule (90 FR 49556 through 49558), we
finalized a policy that effective January 1, 2026, services that are
established and paid under the PFS and designated as care management
services would be considered ``care coordination services'' for
purposes of separate payment for RHCs and FQHCs. The care coordination
codes can be found in the PFS table entitled ``Designated Care
Management Services'', which is published annually with the PFS Final
Rule Addenda on the CMS website.
2. Payment for Certain Preventive Services
a. Background
Medicare Part B covers a comprehensive set of preventive services
aimed at promoting early detection and reducing the risk of chronic
disease.\150\ These services include wellness visits (such as the IPPE
and AWV), evidence-based screenings for cancer and chronic conditions,
behavioral health and risk factor screenings, certain vaccinations, and
preventive counseling interventions. Coverage for many of these
services was expanded under sections 4103 and 4104 of the Affordable
Care Act; the services
[[Page 43957]]
are covered without beneficiary cost-sharing when furnished according
to Medicare requirements. Collectively, they are designed to support
proactive, patient-centered care and improve long-term health outcomes,
particularly when delivered in primary care settings. CMS has
implemented these statutory provisions through regulations at 42 CFR
part 410, which define, among other things, the coverage, eligibility,
and frequency requirements for preventive services.
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\150\ https://www.cms.gov/medicare/prevention/prevntiongeninfo/medicare-preventive-services/mps-quickreferencechart-1.html.
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CMS also establishes and updates coverage of preventive services
through the National Coverage Determination (NCD) process, if such
services are recommended with a grade of A or B by the U.S. Preventive
Services Task Force (USPSTF). These processes specify the conditions
under which preventive services are considered reasonable and necessary
for Medicare beneficiaries.
Payment for preventive services is made in accordance with
applicable Medicare payment systems, for example, the PFS under 42 CFR
part 414. CMS provides additional operational guidance through
subregulatory instructions, including manuals and program transmittals,
to ensure consistent implementation of coverage and payment policies.
Beneficiary copayment and deductible (where applicable) is waived by
the Affordable Care Act for the IPPE and AWV, and for Medicare-covered
preventive services recommended by the USPSTF with a grade of A or B.
When statutorily permissible, we pay for covered preventive
services under Medicare Part B to RHCs and FQHCs pursuant to such
facilities' encounter-based payment methodologies, rather than as PFS
separately billable services, except where otherwise specified.
RHCs are paid under the AIR methodology for a limited number of
qualified preventive health services furnished by an RHC practitioner.
FQHCs are paid under the FQHC PPS for qualified preventive health
services and preventive primary health services required under section
330 of the PHS Act.\151\ A qualified preventive health service refers
to a Medicare-covered preventive service that also meets the
requirements for a billable RHC or FQHC visit, including a face-to-face
encounter with a RHC or FQHC practitioner (that is, the service is at a
level that requires the expertise of a RHC or FQHC practitioner).
Specifically, RHCs and FQHCs are paid for the professional component of
allowable preventive services when the program requirements are met and
frequency limits (where applicable) have not been exceeded.\152\ In
this context, professional component refers to the practitioner's
clinical service associated with a preventive service, as opposed to
the technical or ancillary elements of the service. Preventive services
furnished in other settings, for example, physician offices, are
generally paid on a service-by-service basis. However, preventive
services that do not constitute a separate billable RHC or FQHC visit
must be furnished as part of a qualified RHC or FQHC visit (for
example, an evaluation and management (E/M) visit) to be billable to
Medicare. If a preventive service, that does not constitute a billable
RHC or FQHC visit, is furnished and is not part of a qualified RHC or
FQHC visit, it may not be payable under Medicare.
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\151\ Section 1861(aa)(3) of the Act (42 U.S.C. 1395x(aa)(3))
defines Federally Qualified Health Center (FQHC) services to include
services and supplies furnished by an FQHC, including preventive
primary health services required under section 330 of the Public
Health Service Act (42 U.S.C. 254b).
\152\ Pub. 100-02, Chapter 13, Section 220--Preventive Health
Services.
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b. Federal Initiatives To Improve Health Outcomes and Access to Care
(1) The Make America Healthy Again (MAHA) Commission
On February 13, 2025, the President signed an Executive Order
establishing the MAHA Commission within the Department of Health and
Human Services (HHS).\153\ The Commission is chaired by the Secretary
of HHS and includes representatives from multiple Federal agencies. The
Commission was directed to assess contributing factors to chronic
disease and to develop a coordinated Federal strategy to improve
population health outcomes, with an initial focus on pediatric
populations.
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\153\ Exec. Order No. 14212, Establishing the Make America
Healthy Again Commission, 90 FR 9833 (Signed, February 13, 2025).
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In 2025, the Commission released an assessment identifying a range
of factors associated with chronic disease, including dietary patterns,
environmental exposures, physical inactivity, and other behavioral and
upstream drivers of health. The Commission subsequently issued a
strategy outlining potential Federal actions to address these factors
through cross-agency coordination, research, and programmatic
initiatives.\154\
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\154\ https://www.usda.gov/about-usda/news/press-releases/2025/09/09/maha-commission-unveils-sweeping-strategy-make-our-children-healthy-again.
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Although the Commission's initial focus is on childhood health, its
findings are relevant to Federal health programs serving other
populations, including Medicare beneficiaries. Chronic conditions
associated with the factors identified by the Commission are prevalent
among Medicare beneficiaries and are significant drivers of program
expenditures.
(2) The Rural Health Transformation (RHT) Program
The RHT Program was authorized by section 71401 of the Working
Families Tax Cut (WFTC) (Pub. L. 119-21, July 4, 2025) legislation and
empowers States to strengthen rural communities across America by
improving healthcare access, quality, and outcomes by transforming the
healthcare delivery ecosystem. On September 15, 2025, we announced the
availability of funding under the RHT Program and program objectives
for States seeking to participate in this initiative, among other
information. The RHT Program represents a $50 billion Federal
investment over 5 Federal fiscal years (FY 2026 to FY 2030), with $10
billion available annually, intended to strengthen health care
infrastructure, expand access to care, and improve health outcomes in
rural communities across the United States.
The program has five strategic goals, grounded in the permissible
uses of funds under the statute: Make Rural America Healthy Again--
Support rural health innovations and new access points to promote
preventive health and address the root causes of disease; Sustainable
Access--Improve the efficiency and long-term sustainability of rural
health care providers as enduring access points for care; Workforce
Development--Strengthen recruitment and retention of qualified health
care professionals in rural communities; Innovative Care--Advance
innovative care models that improve health outcomes, coordinate care,
and promote flexible care arrangements; and Technology Innovation--
Foster the adoption of innovative technologies that promote efficient
care delivery, data security, and access to digital health tools for
rural facilities, providers, and patients.\155\
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\155\ https://www.cms.gov/priorities/rural-health-transformation-rht-program/overview.
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c. Increasing Access to Diabetes Self-Management Training (DSMT) and
Medical Nutrition Therapy (MNT) Services in RHCs
Section 4105 of the Balanced Budget Act of 1997 added section
1861(qq) of the Act to permit Medicare coverage of outpatient DSMT
services when these services are furnished by a certified provider who
meets certain quality
[[Page 43958]]
standards. This program is intended to educate beneficiaries in the
successful self-management of diabetes. The program includes
instructions in self-monitoring of blood glucose; education about diet
and exercise; an insulin treatment plan developed specifically for the
patient who is insulin dependent; and motivation for patients to use
the skills for self-management. DSMT services may be covered by
Medicare only if the treating physician or treating qualified non-
physician practitioner who is managing the beneficiary's diabetic
condition certifies that such services are needed. The referring
physician or qualified non-physician practitioner must maintain the
plan of care in the beneficiary's medical record and documentation
substantiating the need for training on an individual basis when group
training is typically covered, if so ordered. A designated certified
provider bills for DSMT provided by an accredited DSMT program.
Certified providers must submit a copy of their accreditation
certificate to the contractor. The statute states that a ``certified
provider'' is a physician or other individual or entity designated by
the Secretary that, in addition to providing outpatient self--
management training services, provides other items and services for
which payment may be made under title XVIII of the Act, and meets
certain quality standards.
We designated all providers and suppliers that bill Medicare for
other individual services such as hospital outpatient departments,
renal dialysis facilities, physicians and durable medical equipment
suppliers, as eligible to be certified providers. All suppliers/
providers who may bill for other Medicare services or items and who
represent a DSMT program that is accredited as meeting quality
standards can bill and receive payment for the entire DSMT program.
Registered dietitians are eligible to bill on behalf of an entire
DSMT program on or after January 1, 2002, if the provider employing or
contracting with the dietitian has obtained a Medicare provider number.
A dietitian may not be the sole practitioner of the DSMT service.\156\
Under our regulations at Sec. 410.144(a)(4)(ii), there is an exception
for dietitians working in rural areas. In a rural area, an individual
who is qualified as a registered dietitian and as a certified diabetic
educator who is currently certified by an organization approved by us
may furnish training and is deemed to meet the multidisciplinary team
requirement. DSMT requirements for coverage, beneficiary eligibility,
services and frequency of services and provider certification and
accreditation are codified in 42 CFR 410 subpart H and the National
Coverage Determination (NCD) 40.1.\157\
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\156\ https://www.cms.gov/Regulations-and-Guidance/Guidance/Transmittals/downloads/b02062.pdf.
\157\ https://www.cms.gov/medicare-coverage-database/view/ncd.aspx?ncdid=251&ncdver=1&keyword=DSMT&keywordType=starts&areaId=all&docType=NCA,CAL,NCD,MEDCAC,TA,MCD,6,3,5,1,F,P&contractOption=all&sortBy=relevance&bc=1.
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Section 1861(s)(2)(V) of the Act authorizes Medicare Part B
coverage of MNT for certain beneficiaries who have diabetes or a renal
disease. Regulations for MNT were established effective January 1,
2002, at 42 CFR 410 subpart G (66 FR 55246 and 55331). An NCD
establishes the duration and frequency limits for the MNT benefit and
coordinates MNT and DSMT.\158\ MNT services are defined in section
1861(vv) of the Act as nutritional diagnostic, therapeutic, and
counseling services provided by a registered dietitian or nutrition
professional for the purpose of managing diabetes or a renal disease
under a referral by a physician. The provider qualifications for
registered dieticians and nutrition professionals are defined in Sec.
410.134.
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\158\ https://www.cms.gov/medicare-coverage-database/view/ncd.aspx?NCDId=252.
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Effective January 1, 2022, coverage of MNT, for the first year a
beneficiary receives MNT, with either a diagnosis of renal disease or
diabetes as defined at 42 CFR 410.130 is 3 hours of administration.
Coverage in subsequent years for renal disease or diabetes is 2 hours.
The dietitian/nutritionist may choose how many units are administered
per day as long as all of the other requirements of the NCD and
Sec. Sec. 410.130 through 410.134 are met. Under the exception at
Sec. 410.132(b)(5), additional hours are considered to be medically
necessary and covered if the physician determines that there is a
change in medical condition, diagnosis, or treatment regimen that
requires a change in MNT and orders additional hours during that
episode of care. If the physician determines that receipt of both MNT
and DSMT is medically necessary in the same episode of care, Medicare
will cover both DSMT and MNT initial and subsequent years without
decreasing either benefit as long as DSMT and MNT are not provided on
the same date of service.
Section 5114 of the Deficit Reduction Act of 2005 amended section
1861(aa)(3) of the Act to add DSMT and MNT services as covered and paid
under the FQHC benefit, effective January 1, 2006. Then the Affordable
Care Act further expanded the scope of FQHC services to include
preventive services defined under section 1861(ddd)(3) of the Act,
however, RHCs were not similarly addressed. Under this statutory
authority, DSMT and MNT services furnished by certified providers are
stand-alone billable visits in FQHCs when all of the requirements are
met. If DSMT or MNT services are provided on the same day as another
qualified visit, the FQHC is paid for one visit, and the charges
associated with DSMT or MNT are waived from coinsurance obligations (79
FR 25447). We note, group DSMT is not payable in FQHCs because Medicare
payment is limited to individual, face-to-face encounters under the
FQHC PPS, and group training does not meet the definition of a billable
visit.
For RHCs, DSMT services and MNT services rendered by registered
dietitians or nutrition professionals are included under the RHC
benefit, if all relevant program requirements are met. Separate payment
under Part B to RHCs for these services provided by these practitioners
is precluded as set forth in regulations at Sec. Sec. 414.63 and
414.64. However, RHCs are permitted to become certified providers of
DSMT and MNT services and bundle the cost of such services into their
clinic payment rates. The provision of these services would not
generate an RHC visit, though their costs may be included in the cost
report and used for determining the AIR.\159\ Consequently, RHCs are
not paid for encounters where only DSMT or MNT services are provided.
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\159\ https://www.cms.gov/regulations-and-guidance/guidance/transmittals/downloads/a03021.pdf.
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For several years, interested parties have expressed concern about
access to DSMT and MNT services in RHCs. Commenters stated that because
these are preventive services, not treating these services as a
separate encounter is impacting access to care for rural beneficiaries.
They state that there are additional concerns regarding the payment for
DSMT and MNT services between RHCs and FQHCs and rural interested
parties have requested aligning payment for these services. They
believe that we should recognize DSMT and MNT services as a qualified
visit for RHCs when these services are provided by a certified provider
and all the requirements are met. They believe that the utilization
rate is low for beneficiaries receiving care in RHCs and explained that
if we allow RHCs to receive payment for furnishing DSMT
[[Page 43959]]
and MNT services, then this rate may increase.
Recent studies highlight a continued need for DSMT and MNT services
in rural areas, driven by rising diabetes prevalence and significant
access disparities. Some of the barriers identified for people living
in rural communities, especially for getting access to diabetes
education and prevention programs, include limited number of providers,
longer distance to medical facilities, higher costs, outdated cultural
beliefs, lack of transportation, and limited community resources. More
efforts to reduce these barriers may help reduce the overall high
burden of diabetes in the rural US.\160\ The necessity of DSMT and MNT
in rural areas is supported by findings such that, they are clinically
essential, diabetes control is improved, complications are reduced,
lower costs, rural populations have equal or greater need, there are
higher diabetes burden (widely established in rural health literature),
access is systematically worse in rural areas, there are fewer
providers, geographic maldistribution, and lower utilization despite
need. Therefore, expanding DSMT and MNT in rural areas is not just
beneficial, it is necessary to address documented health differences in
access and outcomes.\161\ In addition, we have observed that
utilization for these services is low in rural settings. That is, an
analysis of Medicare claims data from 2024 indicate that utilization of
DSMT and MNT in RHC settings is substantially lower than in comparable
care settings. In CY 2024, DSMT services were furnished to
approximately 125 RHC beneficiaries, representing 0.005 percent of the
total RHC beneficiary population of approximately 2.3 million. MNT
services were furnished to approximately 439 RHC beneficiaries,
representing 0.019 percent of the total RHC beneficiary population. On
a claims basis, DSMT accounted for 0.002 percent and MNT for 0.007
percent of total RHC claims in CY 2024. By comparison, FQHCs, showed
DSMT utilization rates approximately 22 times higher and MNT
utilization rates approximately 28 times higher than RHCs on a per-
beneficiary basis. On a claim basis, FQHC utilization of DSMT and MNT
exceeded RHC utilization by approximately 31 times and 32 times,
respectively. Rural physician offices, which share the geographic and
demographic characteristics of RHC patient populations, showed DSMT and
MNT utilization rates approximately 17 times and 7 times higher than
RHCs, respectively, on a per-beneficiary basis. The analysis further
demonstrated that within the PFS setting where DSMT and MNT are most
readily identifiable in claims data, these services represent a very
small share of total Medicare spending--less than 0.01 percent and 0.02
percent of total PFS line payments, respectively, in CY 2024. This
could suggest that beneficiaries receiving care in RHCs may have
disproportionately lower participation due to potential provider
shortages and structural payment barriers when compared to other
settings of care. participation due to potential provider shortages and
structural payment barriers when compared to other settings of care.
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\160\ Khavjou O, Tayebali Z, Cho P, Myers K, Zhang P. Rural-
Urban Disparities in State-Level Diabetes Prevalence Among US
Adults, 2021. Prev Chronic Dis. 2025 Jan 16;22:E05. doi: 10.5888/
pcd22.240199. PMID: 39819894; PMCID: PMC11870018.
\161\ Rhudy, C., Schadler, A., & Talbert, J.C. (2020). Rural/
urban disparities in utilization of diabetes self-management
training to the fee-for-service Medicare population. Rural and
Underserved Health Research Center, University of Kentucky.
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As such, we believe that we should attempt to align access and
payment for RHCs and FQHCs to the extent possible, given the statutory
differences in benefit design between the two settings of care. Because
DSMT and MNT are affirmatively covered Medicare Part B benefits under
sections 1861(s)(2)(S) and 1861(s)(2)(V) of the Act, respectively, and
are defined under sections 1861(qq) and 1861(vv) of the Act, there is a
compelling basis for ensuring these clinically essential services are
payable under the RHC benefit. Continuing to exclude these services
from RHC payment limits access for rural Medicare beneficiaries and
would be inconsistent with both the statutory coverage framework and
the foundational purpose of the RHC program. Reducing differences
between RHCs and other settings in which DSMT and MNT are furnished and
paid, such as in FQHCs and physician office, may help expand access to
care for Medicare beneficiaries in rural areas. This policy would
strengthen access to services that address chronic conditions prevalent
among Medicare beneficiaries which are significant drivers of program
expenditures.
Since DSMT and MNT services may be furnished by certified providers
other than RHC practitioners as defined in Sec. Sec. 410.141 and
410.134, respectively, these services could be furnished by certified
providers under the direct supervision of an RHC practitioner. Direct
supervision does not require the physician (or other supervising
practitioner) to be present in the same room. However, the physician
(or other supervising practitioner) must be in the RHC or FQHC and
immediately available to provide assistance and direction throughout
the time the incident to service or supply is being furnished. See
definitions at Sec. 405.2401(b) ``Direct Supervision.''
We propose to recognize DSMT and MNT services as qualified
preventive services that are covered and paid the AIR as stand-alone
billable visits under the RHC benefit. To constitute as a billable RHC
visit, these services would need to be furnished by a certified
provider under the direct supervision of RHC professional staff. We
believe aligning payment policies in RHCs with other settings, for
example FQHCs and physician offices, would help expand access to care
for Medicare beneficiaries in rural areas while supporting Federal
initiatives to strengthen rural healthcare. As such, we are proposing
to revise Sec. 405.2463(a) and (b)(2) to allow DSMT and MNT services
to be stand-alone billable visits in RHCs. Similar to FQHCs, when DSMT
or MNT is furnished on the same day as another qualified visit, the RHC
would be paid one AIR for that encounter. We consider these policies to
align an incongruency between FQHC and RHC access to preventive
services and do not expect in future rulemaking to propose additional
preventive services beyond which are currently paid for in FQHCs and
physician offices. We invite public comments on these proposals.
3. Services Furnished Using Telecommunication Technology
a. Background
Section 3704 of the Coronavirus Aid, Relief, and Economic Security
Act (CARES Act) (Pub. L. 116-136, March 27, 2020) directed the
Secretary to establish payment for RHC and FQHC services that are
provided as Medicare telehealth services by RHCs and FQHCs serving as a
distant site (that is, where the practitioner is located) during the
PHE for COVID-19. Specifically, section 1834(m)(8)(B) of the Act, as
added by section 3704 of the CARES Act, required that, for the duration
of the PHE for COVID-19, the Secretary develop and implement payment
methods for FQHCs and RHCs that serve as a distant site. The payment
methodology outlined in the CARES Act requires that rates be based on
rates that are similar to the national average payment rates for
comparable telehealth services under the Medicare PFS. Accordingly, we
established payment rates for these services furnished by RHCs and
FQHCs based on the average PFS payment amount for all Medicare
telehealth services, weighted by volume in a
[[Page 43960]]
Special Edition Medicare Learning Network Article (SE20016). Congress
has extended this payment flexibility beyond the PHE for COVID-19
through a series of statutory amendments, most recently under section
6209(c) of the CAA, 2026, which extended this payment flexibility
through December 31, 2027.
We codified this payment policy at 42 CFR 405.2464(g). As amended
in the CY 2025 PFS final rule (89 FR 98554), Sec. 405.2464(g) states
that for an encounter furnished using interactive, real-time, audio/
visual telecommunications technology or for certain audio-only
interactions in cases where the patient is not capable of, or does not
consent to, the use of video technology services that are not described
in Sec. 405.2463(b)(3), payment to RHCs and FQHCs are subject to the
national average payment rates for comparable services under the PFS
and costs associated with these services shall not be used in
determining payments under the RHC all-inclusive rate or the FQHC
prospective payment system.
In the CY 2022 PFS final rule (86 FR 65210 and 65211), we revised
payment for mental health visits in RHCs and FQHCs furnished via
interactive, real-time, audio/visual or audio-only telecommunications
technology. Instead of paying for these services under the national
average payment rates for comparable services under the PFS, as is done
for non-behavioral health services, we amended the regulation at Sec.
405.2463 to permit mental health visits in RHCs and FQHCs furnished via
audio/visual or audio-only telecommunication to be paid under the RHC
AIR and FQHC PPS rates. In addition, to align with the Medicare
telehealth statutory requirements for mental health services, we
finalized at Sec. Sec. 405.2463(b)(3) and 405.2469(d) that there must
be an in-person mental health service furnished within 6 months prior
to the furnishing of the telecommunications service and that an in-
person mental health service (without the use of telecommunications
technology) must be provided at least every 12 months while the
beneficiary is receiving services furnished via telecommunications
technology for diagnosis, evaluation, or treatment of mental health
disorders, unless, for a particular 12-month period, the physician or
practitioner and patient agree that the risks and burdens outweigh the
benefits associated with furnishing the in-person item or service, and
the practitioner documents the reasons for this decision in the
patient's medical record.
However, beginning with section 304 of the Consolidated
Appropriations Act, 2022 (CAA, 2022) (Pub. L. 117-103, March 15, 2022),
the in-person visit requirements for mental health visits were delayed.
These requirements were further delayed through various laws that
included extension of the telehealth flexibilities. Following the
publication of the CY 2026 PFS final rule, section 6208 of the
Continuing Appropriations, Agriculture, Legislative Branch, Military
Construction and Veterans Affairs, and Extensions Act, 2026 (Pub. L.
119-37, November 12, 2025) extended the delay until January 30, 2026.
Most recently, section 6209(d) of the CAA, 2026 extended the abeyance
of the RHC/FQHC mental health in-person requirements through December
31, 2027.
b. Proposal for Conforming Regulatory Text Changes
Because section 6209(c) of the CAA, 2026 extended authority for CMS
to pay for FQHC and RHC non-behavioral health telecommunication
technology services as Medicare telehealth services, we are not
proposing any modifications for this provision to Sec. 405.2464(g).
Because section 6209(d) of the CAA, 2026 extended the abeyance of
the RHC and FQHC mental health in-person requirements through December
31, 2027, we are proposing to make conforming regulatory text changes
at Sec. Sec. 405.2463(b)(3) and 405.2469(d). This provision, as
proposed, would require that the in-person visit requirements not apply
to any services furnished through December 31, 2027.
4. Proposed CY 2027 FQHC PPS Market Basket Update
Section 1834(o)(2)(B)(ii) of the Act requires the FQHC PPS base
rate be updated annually by the percentage increase in a market basket
of Federally qualified health center goods and services as issued
through regulations, or if such an index is not available, by the
percentage increase in the MEI (as defined in section 1842(i)(3) of the
Act) for the year involved. For CY 2027 (that is, January 1, 2027,
through December 31, 2027), we propose to use an estimate of the
percentage increase in the 2022-based FQHC market basket to update
payments to FQHCs based on the best available data. Consistent with CMS
practice, we propose to use the update based on the most recent
historical data available at the time of publication of the final rule.
For example, the final CY 2027 FQHC update would be based on the four-
quarter moving-average percent change of the 2022-based FQHC market
basket through the second quarter of 2026 (based on the final rule's
statutory publication schedule). At the time of this proposed rule, we
do not have the second quarter of 2026 historical data, and therefore,
the proposed CY 2027 FQHC update is based on the most recent projection
available at this time. As finalized in the CY 2025 final rule (89 FR
98032), a productivity adjustment is included in the 2022-based FQHC
market basket.
For CY 2027, we propose to update the CY 2026 FQHC PPS base rate by
the historical percentage increase through the second quarter of 2026
of the productivity-adjusted FQHC market basket (which we refer to as
the FQHC market basket update). For CY 2027, the proposed FQHC market
basket update is estimated to be 2.5 percent and is based on the
expected historical percentage increase of the productivity-adjusted
2022-based FQHC market basket (referred to as the FQHC market basket
update). Multiplying the CY 2026 FQHC PPS base rate amount of $207.72
by the proposed CY 2027 FQHC market basket update of 2.5 percent
($207.72 x 1.025) results in a proposed CY 2027 FQHC PPS base rate
amount of $212.91. For the final rule, we propose that the CY 2027
market basket update and the productivity adjustment will be updated to
reflect historical data through the 2nd quarter of 2026.
5. Proposed Technical Changes
a. Section 405.2464(b)(1) and (2)
We propose revisions at Sec. 405.2464(b)(1) and (2) to correct the
references within these paragraphs so that they reference the
appropriate paragraph or sections under subpart X of part 405. We
propose to revise Sec. 405.2464(b)(1) by replacing ``paragraphs (d)
and (e)'' with ``paragraphs (c) and (h)'' since the payment discussed
under these paragraphs are not based on the FQHC PPS per diem rate. We
propose to revise Sec. 405.2464(b)(2)(i) and (ii) to reference Sec.
405.2462(e). This reference should have been revised when we
redesignated this section in the CY 2022 PFS final rule (86 FR 65660).
b. Sec. 405.2464(g)
In the CY 2025 PFS final rule (89 FR 98015 through 98017) we
discussed medical visit services furnished via telecommunications
technology. We revised Sec. 405.2464 by adding new paragraph (g) to
reflect our payment policy for these services. That is, for non-
behavioral health services, an encounter furnished using
telecommunications technology, payment to RHCs and FQHCs are
[[Page 43961]]
subject to the national average payment rates for comparable services
under the PFS and costs associated with these services shall not be
used in determining payments under the RHC AIR or the FQHC PPS. During
a recent review of our regulation, we noticed that we inadvertently
used the term ``an encounter'' instead of ``services.'' We are
proposing to revise Sec. 405.2464(g) to be consistent with the
authority under section 1834(m)(8) of the Act.
c. Section 405.2469(d)
In the CY 2022 PFS final rule (86 FR 65210 and 65211), we explained
that Sec. 405.2469(d) was revised to describe the same in-person
mental health visit requirement applicable under Sec. 405.2463. In
subsequent PFS rulemaking, as discussed previously in this section, we
described revisions to both provisions as technical changes intended
solely to conform the regulations to the applicable statutory delay of
the in-person requirement. Because the current text of Sec.
405.2469(d) separately restates the technology modalities and in-person
requirement language, it creates an unnecessary risk of divergence from
Sec. 405.2463(b)(3). Accordingly, we propose to revise the regulatory
text at Sec. 405.2469(d) to align the description of permissible
telecommunications modalities with the language used in Sec. 405.2463.
Specifically, Sec. 405.2469(d) currently refers to audio-only
interactions in cases where beneficiaries do not wish to use, or do not
have access to, devices that permit two-way, audio/video communication.
In contrast, Sec. 405.2463 permits the use of audio-only interactions
in cases where the patient is not capable of, or does not consent to,
the use of video technology. To ensure consistency across these
provisions we are proposing to revise the descriptions to match what is
described at Sec. 405.2463, namely that the use of audio-only
interactions is permissible in cases where the patient is not capable
of, or does not consent to, the use of video technology. We are also
proposing to revise Sec. 405.2469(d) to align the description of the
in-person visit requirement for mental health services with the
requirements set forth in Sec. 405.2463(b)(3). We believe that these
amendment are non-substantive and clarifying because they do not alter
payment policy; they merely align duplicative regulatory text and
eliminate any potential internal inconsistency.
C. Clinical Laboratory Fee Schedule (CLFS): Consolidated Appropriations
Act (CAA), 2026
1. Background on the Clinical Laboratory Fee Schedule
Prior to January 1, 2018, Medicare paid for clinical diagnostic
laboratory tests (CDLTs) on the Clinical Laboratory Fee Schedule (CLFS)
under section 1833(a), (b), and (h) of the Act. Under the previous
payment system, CDLTs were paid based on the lesser of: (1) the amount
billed; (2) the local fee schedule amount established by the Medicare
Administrative Contractor (MAC); or (3) a national limitation amount
(NLA), which is a percentage of the median of all the local fee
schedule amounts (or 100 percent of the median for new tests furnished
on or after January 1, 2001). In practice, most tests were paid at the
NLA. Under the previous payment system, the CLFS amounts were updated
for inflation based on the percentage change in the Consumer Price
Index for All Urban Consumers (CPI-U), and reduced by a productivity
adjustment and other statutory adjustments, but were not otherwise
updated or changed. Coinsurance and deductibles generally do not apply
to CDLTs paid under the CLFS.
Section 1834A of the Act, as established by section 216(a) of the
Protecting Access to Medicare Act of 2014 (PAMA), required significant
changes to how Medicare pays for CDLTs under the CLFS. In a final rule
that appeared in the June 23, 2016 Federal Register (81 FR 41036),
entitled Medicare Clinical Diagnostic Laboratory Tests Payment System
(hereinafter referred to as the CLFS final rule), we established
requirements to implement section 1834A of the Act at 42 CFR part 414,
subpart G.
Under the CLFS final rule, ``reporting entities'' must report to
CMS during a ``data reporting period'' ``applicable information''
collected during a ``data collection period'' for their component
``applicable laboratories.'' The first data collection period occurred
from January 1, 2016, through June 30, 2016. The first data reporting
period occurred from January 1, 2017, through March 31, 2017. On March
30, 2017, we announced a 60-day period of enforcement discretion for
the application of the Secretary's potential assessment of civil
monetary penalties for failure to report applicable information with
respect to the initial data reporting period.\162\
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\162\ https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/ClinicalLabFeeSched/Downloads/2017-March-Announcement.pdf.
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In the CY 2018 PFS proposed rule (82 FR 34089 through 34090), we
solicited public comments from applicable laboratories and reporting
entities to better understand the applicable laboratories' experiences
with data reporting, data collection, and other compliance requirements
for the first data collection and reporting periods. We discussed these
comments in the CY 2018 PFS final rule (82 FR 53181 through 53182) and
stated that we would consider the comments for potential future
rulemaking or guidance.
As part of the CY 2019 Medicare PFS rulemaking, we finalized two
changes to the definition of ``applicable laboratory'' at Sec. 414.502
(see 83 FR 59667 through 59681, 60074; 83 FR 35849 through 35850, 35855
through 35862). First, we excluded Medicare Advantage plan payments
under Part C from the denominator of the Medicare revenues threshold
calculation to broaden the types of laboratories qualifying as an
applicable laboratory. Second, consistent with our goal of obtaining a
broader representation of laboratories that could potentially qualify
as an applicable laboratory and report data, we also amended the
definition of applicable laboratory to include hospital outreach
laboratories that bill Medicare Part B using the CMS-1450 14x Type of
Bill.
2. Payment Requirements for Clinical Diagnostic Laboratory Tests
In general, under section 1834A of the Act, the payment amount for
each CDLT on the CLFS furnished beginning January 1, 2018, is based on
the applicable information collected during the data collection period
and reported to CMS during the data reporting period and is equal to
the weighted median of the private payor rates for the test. The
weighted median is calculated by arraying the distribution of all
private payor rates, weighted by the volume for each payor and each
laboratory. The payment amounts established under the CLFS are not
subject to any other adjustment, such as geographic, budget neutrality,
or annual update, as required by section 1834A(b)(4)(B) of the Act.
Additionally, section 1834A(b)(3) of the Act, implemented at Sec.
414.507(d), provides for a phase-in of payment reductions, limiting the
amounts the CLFS rates for each CDLT (that is not a new advanced
diagnostic laboratory test (ADLT) or new CDLT) can be reduced as
compared to the payment rates for the preceding year. Under the
original provisions enacted by section 216(a) of PAMA, for the first 3
years after implementation (CY 2018 through CY 2020), the reduction
could not be more
[[Page 43962]]
than 10 percent per year. For the next 3 years after implementation (CY
2021 through CY 2023), section 216(a) of PAMA stated that the reduction
could not be more than 15 percent per year. Under sections 1834A(a)(1)
and (b) of the Act, as enacted by PAMA, for CDLTs that are not ADLTs,
the data collection period, data reporting period, and payment rate
update were to occur every 3 years. As such, the second data collection
period for CDLTs that are not ADLTs was originally scheduled to take
place from January 1, 2019, through June 30, 2019, and the next data
reporting period was originally scheduled to take place from January 1,
2020, through March 31, 2020, with the next update to the Medicare
payment rates for those tests based on that reported applicable
information scheduled to take effect on January 1, 2021.
Section 216(a) of PAMA established a new subcategory of CDLTs known
as ADLTs, with separate reporting and payment requirements under
section 1834A of the Act. The definition of an ADLT is set forth in
section 1834A(d)(5) of the Act and implemented at Sec. 414.502.
Generally, under section 1834A(d) of the Act, the Medicare payment rate
for a new ADLT is equal to its actual list charge during an initial
period of 3 calendar quarters. After the new ADLT initial period, ADLTs
are paid using the same methodology based on the weighted median of
private payor rates as other CDLTs. However, under section 1834A(d)(3)
of the Act, updates to the Medicare payment rates for ADLTs occur
annually instead of every 3 years.
Additional information on the private payor rate-based CLFS is
detailed in the CLFS final rule (81 FR 41036 through 41101) and is
available on the CMS website.\163\
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\163\ https://www.cms.gov/medicare/payment/fee-schedules/clinical-laboratory-fee-schedule/clfs-history.
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3. Previous Statutory Revisions to the Data Reporting Period and Phase-
In of Payment Reductions
Beginning in 2019, Congress repeatedly extended the data reporting
periods for CDLTs that are not ADLTs and revised the phase-in of CLFS
payment reductions through multiple laws, including: section 105 of the
Further Consolidated Appropriations Act, 2020 (FCAA) (Pub. L. 116-94,
December 20, 2019); section 3718 of the Coronavirus Aid, Relief, and
Economic Security Act (CARES Act) (Pub. L. 116-136, March 27, 2020);
section 4 of the Protecting Medicare and American Farmers from
Sequester Cuts Act (PMAFSCA) (Pub. L. 117-71, December 10, 2021);
section 4114 of the Consolidated Appropriations Act, 2023 (CAA, 2023)
(Pub. L. 117-328, December 29, 2022); section 502 of the Further
Continuing Appropriations and Other Extensions Act, 2024 (FCAOEA, 2024)
(Pub. L. 118-22, November 17, 2023); and section 221 of the Continuing
Appropriations and Extensions Act, 2025 (CAEA, 2025) (Pub. L. 118-83,
September 26, 2024). For a detailed discussion of these statutory
revisions, please see the CY 2025 PFS final rule (89 FR 98038 through
98043) and the prior PFS rules referenced in the CY 2025 discussion.
4. Additional Statutory Revisions to the Data Reporting Period, Phase-
In of Payment Reductions and Data Collection Period
Section 6209 of the Continuing Appropriations, Agriculture,
Legislative Branch, Military Construction and Veterans Affairs, and
Extensions Act, 2026 (Pub. L. 119-37, enacted November 12, 2025) made
further revisions to the CLFS requirements for the next data reporting
period for CDLTs that are not ADLTs and to the phase-in of payment
reductions under section 1834A of the Act. Specifically, section
6209(b) of the Continuing Appropriations, Agriculture, Legislative
Branch, Military Construction and Veterans Affairs, and Extensions Act,
2026 delayed the next data reporting period for CDLTs that are not
ADLTs so that reporting would be required during the period of February
1, 2026 through April 30, 2026, instead of the data reporting period of
January 1, 2025, through March 31, 2025 established under the FCAOEA,
2024.
Section 6209 of the Continuing Appropriations, Agriculture,
Legislative Branch, Military Construction and Veterans Affairs, and
Extensions Act, 2026 did not modify the data collection period that
applies to the next data reporting period for these tests. Thus, under
section 1834A(a)(4)(B) of the Act, as amended by section 105(a)(1) of
the FCAA, the next data reporting period for CDLTs that are not ADLTs
(February 1, 2026, through April 30, 2026) continued to be based on the
data collection period of January 1, 2019, through June 30, 2019, as
defined in Sec. 414.502.
Section 6209(a) of the Continuing Appropriations, Agriculture,
Legislative Branch, Military Construction and Veterans Affairs, and
Extensions Act, 2026 amended the provisions in section 1834A(b)(3) of
the Act regarding the phase-in of payment reductions under the CLFS.
First, it extended the statutory phase-in of payment reductions
resulting from private payor rate implementation by an additional year,
that is, through CY 2029. It further amended section 1834A(b)(3)(B)(ii)
of the Act to specify that the applicable percent for CY 2026 was 0
percent, meaning that the payment amount determined for a CDLT for CY
2026 shall not result in any reduction in payment as compared to the
payment amount for that test for CY 2025. Section 6209(b) of this law
further amended section 1834A(b)(3)(B)(iii) of the Act to state that
the applicable percent of 15 percent would apply for CYs 2026 (January
31, 2026 through December 31, 2026), 2027, and 2028.
Most recently, section 6226 of the Consolidated Appropriations Act,
2026 (CAA, 2026) (Pub. L. 119-75, February 3, 2026) amended section
1834A of the Act to revise the data reporting period, data collection
period, and requirements for the phase-in of payment reductions.
Specifically, section 6226 of the CAA, 2026 revised the next required
data reporting period for CDLTs that are not ADLTs to be May 1, 2026,
through July 31, 2026, and specified that the applicable data
collection period is January 1, 2025, through June 30, 2025.
Section 6226 of the CAA, 2026 also amended section 1834A(b)(3) of
the Act to specify that the applicable percent was 0 percent for all of
CY 2026, meaning that the payment amount determined for a CDLT for CY
2026 shall not result in any reduction in payment as compared to the
payment amount for that test for CY 2025, and to extend the statutory
phase-in of payment reductions resulting from private payor rate
implementation by an additional year, that is, through CY 2029.
Therefore, the applicable percent of up to 15 percent would apply for
CYs 2027 through 2029. Section 6226 of the CAA, 2026 further provided
that, notwithstanding any other provision of law, the Secretary may
implement the amendments made by this section by program instruction or
otherwise.
5. Proposed Conforming Regulatory Changes
In accordance with section 6226 of the CAA, 2026, we are proposing
to make certain conforming changes to the data reporting and payment
requirements at 42 CFR part 414, subpart G. Specifically, we are
proposing to revise Sec. 414.502 to update the definitions of both the
``data collection period'' and ``data reporting period,'' specifying
that the data collection period is the 6-month period from January 1
through June 30, during which applicable information is
[[Page 43963]]
collected and that precedes the data reporting period, and that the
data reporting period for CDLTs that are not ADLTs is the 3-month
period, May 1 through July 31, and for ADLTs is the 3-month period,
January 1 through March 31, during which a reporting entity reports
applicable information to CMS and that follows the preceding data
collection period. We are also proposing to revise Sec. 414.504(a)(1)
to indicate that initially, data reporting begins January 1, 2017, and
is required every 3 years beginning May 1, 2026. In addition, we are
proposing to make conforming changes to our requirements for the phase-
in of payment reductions to reflect the amendments in section 6226 of
the CAA, 2026. Specifically, we are proposing to revise Sec.
414.507(d) to indicate that for CY 2026, payment may not be reduced by
more than 0.0 percent as compared to the amount established for CY
2025, and for CYs 2027 through 2029, payment may not be reduced by more
than 15 percent as compared to the amount established for the preceding
year.
We note that the CYs 2018 through 2026 CLFS payment rates for CDLTs
that are not ADLTs are based on applicable information collected in the
data collection period of January 1, 2016 through June 30, 2016. Under
current law, the CLFS payment rates for those tests for CY 2027 through
CY 2029 will be based on applicable information collected during the
data collection period of January 1, 2025 through June 30, 2025, and
reported to CMS during the data reporting period of May 1, 2026 through
July 31, 2026.
6. Technical Correction (Sec. 414.523(a)(1))
a. Background
Section 1833(h)(3)(A) of the Act generally requires the Secretary
to provide for and establish a nominal fee to cover the appropriate
costs in collecting the sample on which a CDLT was performed and for
which Medicare payment is made, in addition to the amounts provided
under the Medicare CLFS. In addition, section 1834A(b)(5) of the Act
requires that, when the sample is collected from an individual in a
skilled nursing facility (SNF) or by a laboratory on behalf of a home
health agency (HHA), the otherwise applicable nominal specimen
collection fee be increased by $2.00.
In the CY 2023 PFS final rule (87 FR 69744 through 69760), we
finalized a policy to codify specimen collection fee provisions at
Sec. 414.523(a)(1), including updating the base specimen collection
fee amount and establishing an annual CPI-U update. In that rulemaking,
we also stated that the statutory $2.00 increase for specimens
collected from a Medicare beneficiary in a SNF or by a laboratory on
behalf of an HHA would continue to apply, consistent with section
1834A(b)(5) of the Act. However, due to a drafting or codification
error, the operative regulatory text implementing this increase in the
CY 2023 PFS final rule (87 FR 70225 through 70226) was not fully
included in Sec. 414.523(a)(1), and only a partial introductory clause
remains in paragraph (a)(1)(v). Specifically, the introductory text to
Sec. 414.523(a)(1) states that payment is made ``[e]xcept as provided
in paragraph (a)(1)(v),'' but Sec. 414.523(a)(1)(v), as codified,
consists only of the fragment: ``For a specimen collected from a
Medicare beneficiary.'' This text is incomplete and does not contain
operative language establishing an exception or alternative payment
methodology. In addition, other provisions within Sec. 414.523(a)(1),
including paragraph (a)(1)(ii), already specify that the specimen must
be collected from a Medicare beneficiary, creating an apparent internal
inconsistency when read together with the introductory exception
clause.
b. Proposed Technical Correction
To resolve this internal inconsistency and accurately reflect the
statutory provisions and longstanding policy, we are proposing to
revise Sec. 414.523(a)(1) to restore the complete and operative
language implementing the statutory $2.00 increase. That is, we propose
revising Sec. 414.523(a)(1)(v) to state that for a specimen collected
from a Medicare beneficiary in a skilled nursing facility or on behalf
of a home health agency, the specimen collection fee otherwise paid
under paragraph (a)(1) of this section is increased by $2.00.
We do not believe that this proposal reflects a substantive policy
change. In the CY 2023 PFS proposed rule (87 FR 46043), we proposed to
codify existing specimen collection fee policies and to incorporate the
statutory $2.00 increase for SNF and HHA collections into Sec.
414.523(a)(1) as a discrete paragraph. Specifically, we proposed that,
beginning April 1, 2014, for a specimen collected from a Medicare
beneficiary in a SNF or on behalf of an HHA, the specimen collection
fee otherwise paid under Sec. 414.523(a)(1) would be increased by
$2.00, consistent with section 1834A(b)(5) of the Act. In the CY 2023
PFS final rule (87 FR 69744 through 69760), we finalized policies
consistent with this framework, including the continued application of
the statutory $2.00 increase.
We note that it has been, and continues to be, CMS' policy to pay
the specimen collection fee only for qualifying specimens collected
from Medicare beneficiaries, and to apply the additional $2.00 increase
for specimens collected from a Medicare beneficiary in a SNF or by a
laboratory on behalf of an HHA, as required by statute. We have
consistently implemented this policy operationally through claims
processing systems, subregulatory guidance, and annual payment updates.
D. Proposed Changes to the Ambulatory Specialty Model (ASM)
1. Executive Summary and Background
a. Executive Summary
(1) Purpose
We are proposing to make changes to the Ambulatory Specialty Model
(ASM or model) effective on the model start date of January 1, 2027.
(2) Summary of Major Provisions
ASM is a mandatory alternative payment model tested by the CMS
Center for Medicare and Medicaid Innovation (Innovation Center) under
section 1115A of the Act. ASM will have 5 performance years that begin
January 1, 2027 and end December 31, 2031 with performance-based
payment adjustments occurring 2 calendar years (CYs) following the end
of each ASM performance year.
We finalized ASM through notice-and-comment rulemaking in the
Medicare and Medicaid Programs; CY 2026 Payment Policies Under the
Physician Fee Schedule and Other Changes to Part B Payment and Coverage
Policies; Medicare Shared Savings Program Requirements; and Medicare
Prescription Drug Inflation Rebate Program final rule (hereinafter ``CY
2026 PFS final rule'') (90 FR 49562 through 49720). However, based on
the feedback we received after the publication of the CY 2026 PFS final
rule and our own internal review, we are proposing several technical
refinements and adjustments to the model. As described in detail in
section III.D.2 of this proposed rule, we propose the following
modifications:
Revising select ASM definitions and adding new ASM
definitions.
Clarifying ASM participant exceptions from specified model
requirements due to taxpayer identification number (TIN) changes before
or during an ASM performance year.
Excepting certain ASM heart failure participants from
specified model
[[Page 43964]]
requirements due to a redesignated specialty type.
Incorporating an option to terminate ASM participants
under certain circumstances.
Incorporating an option for data submission for the
improvement activities ASM performance category at either the
individual or group level.
Clarifying the scoring of multiple quality measure data
submissions from ASM participants in small practices.
Adding an administrative claims-based low back pain
imaging quality measure and replacing the patient-reported outcome
measure for low back pain with a functional status outcome process
measure.
Adjusting benchmarking and scoring policies for quality
measures.
Adding a quality ASM performance category scoring
incentive for the voluntary submission of patient-reported outcome
(PRO) data to support the development of patient-reported outcome
performance-based measures (PRO-PM) under ASM.
Revising requirements of the Promoting Interoperability
ASM performance category to align with proposed changes to the Merit-
based Incentive Payment System (MIPS) Promoting Interoperability
performance category and adding a Promoting Interoperability measure
suppression policy.
Incorporating a rural scoring adjustment for ASM
participants in rural areas.
Revising the contents of the ASM performance report to
include additional information related to scoring-related proposals in
this proposed rule.
Clarifying language on the application of ASM payment
adjustments when an ASM participant reassigns billing rights to a new
TIN during an ASM payment year.
Clarifying the availability of the CMS-sponsored model
arrangements and patient incentives safe harbor and applicability of
programmatic waivers for ASM to reflect that such flexibilities are
associated with active performance under ASM and would not be available
or applicable during an ASM performance year in which an ASM
participant is either ineligible for, or excepted from, specified model
requirements.
Revising provisions establishing collaborative care
arrangement (CCA) requirements to improve clarity and update the
permissible parties, remuneration conditions, documentation
requirements, and compliance terms.
Clarifying and reorganizing select regulatory text to
improve readability and flow.
The proposals in this proposed rule reflect our commitment to
ensuring ASM's incentives help drive quality of care improvements for
beneficiaries and reductions in Medicare spending.
b. Background
(1) Statutory Authority
Section 1115A of the Act authorizes the Secretary to test
innovative payment and service delivery models to reduce program
expenditures under Medicare, Medicaid, and the Children's Health
Insurance Program (CHIP) while preserving or enhancing the quality of
care furnished to beneficiaries. Under this authority, we may test
models that modify payment methodologies, establish accountability for
quality and cost outcomes, and incorporate financial risk arrangements.
Under the authority of sections 1115A and 1871(a)(2) of the Act,
through notice-and-comment rulemaking, we finalized ASM in the CY 2026
PFS final rule that appeared in the November 5, 2025, Federal Register
(90 FR 49562 through 49720).
(2) Background
ASM will test whether holding physician specialists accountable for
the quality and cost of care associated with the longitudinal
management of specific chronic conditions, heart failure and low back
pain, can reduce Medicare expenditures while preserving or enhancing
quality of care for Original Medicare beneficiaries. Clinical decisions
made by specialists in ambulatory settings can meaningfully influence
disease progression as well as downstream utilization and spending.
ASM's design, in its goal to reduce Medicare expenditures while
preserving or enhancing the quality of care, aims to: (1) improve the
management of chronic disease and slow disease progression through more
effective risk assessment; (2) increase active collaboration between
specialists and primary care providers, and (3) reduce avoidable
hospitalizations and low-value procedures (that is, procedures that
provide little clinical benefit or the risk of harm outweighs its
potential benefit).
In developing ASM, we considered specialist-managed conditions that
often require ongoing outpatient management, diagnostic evaluation,
medication management, coordination by specialists with other
clinicians across different care settings, and, in some cases,
procedural or surgical intervention (90 FR 49562 through 49564). Based
on these factors, ASM selects individual specialists who manage one of
two ASM targeted chronic conditions, heart failure or low back pain. As
we designed ASM's participation criteria and performance evaluation
framework to cover multiple conditions and associated specialists, we
continue to explore whether including additional conditions and
specialists would be appropriate.
Our goal with the model test is to select specialists who have a
meaningful level of engagement in the care of Original Medicare
beneficiaries with ASM targeted chronic conditions as ASM participants.
Under the provisions finalized in the CY 2026 PFS final rule (90 FR
49571 through 49596), we select ASM participants by a combination of a
TIN and a National Provider Identifier (NPI). ASM participants are
clinicians who meet four ASM participant eligibility criteria: (1) bill
claims under the Medicare Physician Fee Schedule, (2) have a selected
physician specialty type relevant to an ASM targeted chronic condition,
(3) meet a historical volume threshold of condition-specific episode-
based cost measure (EBCM) episodes, and (4) have a service location in
a selected mandatory geographic area (that is, selected Core-Based
Statistical Areas (CBSAs) and metropolitan divisions). ASM heart
failure participants include cardiologists, and ASM low back pain
participants include physicians with specialty types of anesthesiology,
interventional pain management, neurosurgery, orthopedic surgery, pain
management, and physical medicine and rehabilitation.
ASM evaluates ASM participants across four ASM performance
categories: quality, cost, improvement activities, and Promoting
Interoperability. The evaluation of ASM participant performance
leverages the MIPS Value Pathways (MVP) framework, which utilizes a
cohesive set of measures and activities focused on performance in
furnishing care for a particular specialty or clinical condition. ASM
participants must meet each ASM performance category's requirements and
report required data. We use data reported by ASM participants and
other administrative data, such as inputs gathered from claims, to
evaluate each ASM participant's performance on an annual basis. We
determine a composite final score for each ASM participant based on
performance across the four ASM performance categories and adjust final
scores to account for beneficiary medical and social complexity as well
as practice size.
[[Page 43965]]
Based on performance relative to other specialists treating the
same ASM targeted chronic condition in an ASM cohort, ASM participants
will receive a positive, neutral, or negative payment adjustment on all
Medicare Part B claims for covered professional services during the CY
2 years following the applicable ASM performance year (for example,
performance during the 2027 ASM performance year results in the
application of ASM payment adjustments during the 2029 ASM payment
year). Payment adjustments will range from negative 9 percent to
positive 9 percent in the first 2 ASM payment years, gradually
increasing to 12 percent in the final ASM payment year.
We refer readers to the CY 2026 PFS final rule (90 FR 49562 through
49720) and ASM's provisions at 42 CFR part 512, subpart G, for
additional information on all finalized provisions.
2. Proposed Changes to Provisions of the Ambulatory Specialty Model
(ASM)
a. Definitions
In the CY 2026 PFS final rule, we finalized certain terms for ASM.
We described these finalized definitions in context throughout section
III.C.2 of the CY 2026 PFS final rule and codified them at Sec.
512.705 (90 FR 49569).
After internal review of ASM's provisions, we believe minor
modifications to select definitions would improve the readability and
overall clarity of ASM's provisions.
Accordingly, we propose at Sec. 512.705 to modify the definition
of ``ASM beneficiary'' to clarify this term means a Medicare FFS
beneficiary who is being treated by an ASM participant for an ASM
targeted chronic condition. We believe this edit would improve the
precision of the definition by using the finalized definition of ``ASM
targeted chronic condition'' that is used throughout ASM's provisions,
rather than just ``targeted chronic condition'' as the definition
currently reads.
We also propose to revise the definition of ``Dual eligible
proportion'' at Sec. 512.705 for clarity. Specifically, we propose to
clarify that the definition of ``Dual eligible proportion'' means ``the
share of an ASM participant's beneficiaries who are dually eligible
Medicare beneficiaries''. This revision would more clearly refer to an
ASM participant.
We refer readers to section III.D.2.f.(3) of this proposed rule for
the proposed definition of ``Rural area'' as it is described in context
of the proposed rural scoring adjustment.
We seek comment on the proposed revisions to the ``ASM
beneficiary'' and ``Dual eligible proportion'' definitions at Sec.
512.705.
b. Participation
(1) Background
As discussed in the CY 2026 PFS final rule (90 FR 49571 through
49596), we designed ASM with a focus on clinicians who commonly treat
Original Medicare beneficiaries in an ambulatory setting, develop
longitudinal relationships with patients, and co-manage beneficiaries
with primary care providers (PCP). In addition, we believe clinicians
who treat ASM targeted chronic conditions are well-positioned to
benefit from improved integration between specialty and primary care,
creating greater opportunities to incentivize high-value care and
tertiary prevention.
We determined the model would assess quality of care provided at
the individual clinician level, as identified by a combination of TIN
and NPI, rather than at the level of a group practice or facility, with
limited exceptions, to align accountability with individual clinical
decision-making and to better capture variation in individual clinical
practice patterns among clinicians within the same organization (90 FR
49574). As a result, each ASM participant is individually responsible
for meeting model requirements and is evaluated independently for the
purposes of ASM performance category scoring, final scoring, and
determining an ASM payment adjustment factor and corresponding ASM
payment multiplier.
(2) Mandatory Participation
In the CY 2026 PFS final rule (90 FR 49571 through 49574), we
finalized that once a clinician meets the ASM participant eligibility
criteria and is selected as an ASM participant, they remain an ASM
participant for the duration of the ASM test period. Once selected as
an ASM participant, there may be circumstances where the ASM
participant does not meet the ASM participant eligibility criteria for
a specific ASM performance year. Accordingly, we developed a policy
whereby an ASM participant is only subject to certain ASM requirements
for the ASM performance year(s) in which they meet ASM participant
eligibility criteria. We also finalized provisions that describe the
effect of not meeting ASM participant eligibility criteria for an ASM
performance year (90 FR 49571 through 49574). Specifically, under
existing provisions, an ASM participant who does not meet ASM
participant eligibility criteria for an ASM performance year is: (1)
not subject to the requirements for performance assessment described at
Sec. 512.715, data submission described at Sec. 512.720, and final
scoring described at Sec. 512.745; (2) not subject to payment
adjustment described at Sec. 512.750 for the corresponding ASM payment
year; and (3) not eligible for Medicare program waivers described at
Sec. 512.775 provided under the model for the applicable ASM
performance year.
To clarify and better incorporate policies related to exceptions of
specific ASM performance requirements and ASM participant terminations
discussed later in this section of this proposed rule, we are proposing
to revise our regulatory text describing mandatory ASM participation
and the effects of not meeting ASM participant eligibility criteria for
an ASM performance year.
Specifically, we propose at Sec. 512.710(a)(1) that a clinician
who we select as an ASM participant for at least one ASM performance
year is considered an ASM participant for the duration of the ASM test
period unless we (1) terminate ASM in accordance with Standard
Provisions for Mandatory Innovation Center Models described at Sec.
512.165, or (2) terminate the ASM participant as described under
proposed Sec. 512.710(h). We believe this proposed revision is
consistent with our original policy finalized in the CY 2026 PFS final
rule describing that an ASM participant, once selected, remains an ASM
participant for the ASM test period. Our proposal also incorporates the
effect of a possible ASM participant termination, which we propose
later in this section of this proposed rule.
We also propose to add a paragraph heading and revise Sec.
512.710(a)(2) to clarify that this paragraph describes the effects of
not meeting ASM participant eligibility criteria for an ASM performance
year. We propose to move select regulatory text at current Sec.
512.710(a)(2)(i) to Sec. 512.710(a)(2) to improve readability and to
incorporate new proposals on the effects of not meeting ASM participant
eligibility criteria for an ASM performance year.
First, we propose to separate select regulatory text included in
current Sec. 512.710(a)(2)(i) into separate paragraphs by revising
paragraph Sec. 512.710(a)(2)(ii) and adding new paragraph Sec.
512.710(a)(2)(iii). Under this proposal, Sec. 512.710(a)(2)(i) would
describe the specified model requirements that an ASM participant would
not be required to meet for the applicable ASM performance year, Sec.
512.710(a)(2)(ii) would describe the specific model requirements not
applicable for the corresponding ASM
[[Page 43966]]
payment year, and Sec. 512.710(a)(2)(iii) would describe an ASM
participant's ineligibility for waivers provided under the model for
the applicable ASM performance year. These revisions do not introduce
substantive changes to finalized provisions describing the effects of
an ASM participant not meeting ASM participant eligibility criteria for
an ASM performance year; rather, we believe such revisions help clarify
that not meeting ASM participant eligibility criteria would not nullify
the application of ASM payment adjustments on Medicare Part B claims
for covered professional services during the corresponding ASM payment
year based on performance in a prior ASM performance year. For example,
a clinician may be selected for mandatory participation for the 2027
ASM performance year. If that ASM participant does not meet the ASM
participant eligibility criteria for the 2029 ASM performance year, the
revisions here help clarify that while the ASM participant would not be
subject to the applicable performance assessment, data reporting, and
scoring requirements during the 2029 ASM performance year (that is, CY
2029), but that ASM payment adjustments based on the ASM participant's
performance from the 2027 ASM performance year would still be applied
in CY 2029.
Second, we propose at Sec. 512.710(a)(2)(iv) that an ASM
participant who does not meet ASM participant eligibility criteria for
an ASM performance year would not be eligible for the CMS-sponsored
model arrangements and patient incentives safe harbor described at
Sec. 512.765 for the applicable ASM performance year. We believe this
proposal is consistent with our intent to make this safe harbor
available for ASM performance years where the ASM participant is
actively performing in the model (90 FR 49709). We refer readers to
section III.D.2.h. of this proposed rule for further explanation of
this proposal.
We seek comment on our proposed revisions to Sec. Sec.
512.710(a)(1) and 512.710(a)(2).
(3) Specialty Type
Participation is limited to clinicians who are within specialties
and furnish covered professional services related to ASM targeted
chronic conditions--heart failure or low back pain. As finalized in the
CY 2026 PFS final rule, we determine specialty type based on the
specialty code most frequently reported on a clinician's Medicare Part
B claims (90 FR 49583 through 49585). Medicare Administrative
Contractors (MACs) derive specialty codes on claims from clinician-
reported specialty types provided during Medicare enrollment.
Physicians report their specialty type as part of their Medicare
enrollment application through the Provider Enrollment, Chain, and
Ownership System (PECOS) or through submission of the CMS 855I paper
application.\164\ The Medicare enrollment form is also used for
revalidations and ad hoc changes to certain information. We use data
from the CY 2 years prior to each ASM performance year to determine
whether a clinician meets the model's specialty type criteria. For
example, we use CY 2025 data, including specialty type data, to select
final ASM participants for the 2027 ASM performance year.
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\164\ https://www.cms.gov/medicare/cms-forms/cms-forms/cms-forms-items/cms019477.
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For the ASM heart failure cohort, we finalized inclusion of
physicians with a specialty type of cardiology. Our rationale for
including cardiologists as ASM heart failure participants, as explained
in the CY 2026 PFS final rule, is that they commonly provide care to
Original Medicare beneficiaries with heart failure and are well-
positioned to manage outcomes by ensuring patients are optimized on
guideline-directed medical therapy to prevent exacerbation of their
condition (90 FR 49576). We did not finalize the inclusion of other
cardiac-related specialties (for example, cardiac electrophysiology,
intensive cardiac rehabilitation, cardiac surgery, interventional
cardiology, and advanced heart failure and transplant) as these
clinicians are often proceduralists and not commonly involved in the
longitudinal management of patients with heart failure (90 FR 49576).
Because one of ASM's goals is to measure the performance of clinicians
with similar patterns of heart failure care, we include cardiologists,
but not other cardiac-related specialties, even though those cardiac-
related specialists may be attributed patients with heart failure as
measured through the heart failure EBCM (90 FR 49577).
For the ASM low back pain cohort, we finalized inclusion of
physicians who have a specialty of anesthesiology, pain management,
interventional pain management, neurosurgery, orthopedic surgery, or
physical medicine and rehabilitation. In the CY 2026 PFS final rule (90
FR 49577 through 49580), we emphasized that specialty types for the ASM
low back pain cohort include physicians who are most directly involved
in the evaluation and management of low back pain and whose clinical
decision-making is expected to meaningfully influence downstream
utilization and spending. We explained that the included specialists
commonly furnish services to Original Medicare beneficiaries with low
back pain and play a central role in determining the use of imaging,
injections, procedures, and surgical interventions. We also noted that
we did not include certain other specialties that may occasionally
treat low back pain but are not typically responsible for its
longitudinal management. By focusing on a defined set of specialties
with similar roles in managing low back pain, we aim to support more
meaningful comparisons of performance and to align model incentives
with opportunities to improve care coordination, reduce unnecessary
procedures, and promote evidence-based treatment.
We are not proposing any adjustments to the specialty types
included in each ASM cohort as finalized at Sec. 512.710(d) in the CY
2026 PFS final rule (90 FR 49576 through 49580). As part of this
proposed rule, we are proposing to correct small typographical errors
in the regulatory text at Sec. Sec. 512.710(d)(1) and 512.710(d)(2).
These revisions do not introduce substantive changes to existing
provisions.
We seek comment on the proposed correction of the typographical
errors at Sec. Sec. 512.710(d)(1) and 512.710(d)(2).
(4) ASM Participant Exceptions
We recognize that there may be limited circumstances in which an
ASM participant selected for participation for an ASM performance year
should be excepted from certain ASM requirements for that ASM
performance year and should consequently be excepted from the
application of an ASM payment multiplier to the ASM participant's
Medicare Part B payments for covered professional services during the
corresponding ASM payment year. Accordingly, we finalized a narrow set
of ASM participant ``exclusions,'' or situations in which an ASM
participant is excepted from specified ASM requirements in the CY 2026
PFS final rule to balance operational feasibility with the need for
robust evaluation and generalizable findings (90 FR 49582 through
49583). As finalized at Sec. 512.710(c), an ASM participant who stops
reassigning billing rights to the TIN we used to select the ASM
participant and begins reassigning billing rights to a new TIN during
an ASM performance year is not subject to certain ASM requirements--
specifically the requirements for performance assessment described at
Sec. 512.715, data submission described at Sec. 512.720, final
scoring described at Sec. 512.745, and
[[Page 43967]]
payment adjustment described at Sec. 512.750--and is no longer
eligible for Medicare program waivers provided under the model
described at Sec. 512.775 for the applicable ASM performance year. An
exception from specified ASM requirements for one ASM performance year
does not apply for the entire ASM test period because we consider
clinicians who meet ASM participant eligibility criteria for at least
one ASM performance year to be an ASM participant for the remainder of
the ASM test period. This means that an ASM participant will receive
payment adjustments during a corresponding ASM payment year based on
performance from an ASM performance year for which they were required
to meet these specified ASM requirements (90 FR 49571 through 49574).
In other words, if an ASM participant meets the ASM participant
eligibility criteria for the 2027 and 2028 ASM performance years, but
not the 2029 and 2030 ASM performance years, by continuing to remain an
ASM participant, the ASM payment multipliers calculated based on the
ASM participant's performance during the 2027 and 2028 ASM performance
years would continue to be applied to the ASM participant's Medicare
Part B payments for covered professional services during the
corresponding ASM payment years (that is, CY 2029 and CY 2030).
After internal review, we believe it would be more precise to refer
to the situations in which an ASM participant is not required to meet
specified ASM requirements for applicable ASM performance year(s) as
``exceptions'' to ASM requirements rather than ASM participant
``exclusions.'' We believe this revision to the terminology will better
capture the intended policy to not require an ASM participant to meet
certain ASM requirements for an ASM performance year under certain
circumstances. Accordingly, throughout this section of this proposed
rule, we are proposing revisions to existing regulatory text to clarify
the current circumstances under which an ASM participant may be
excepted from certain ASM requirements and are proposing new provisions
to include additional circumstances under which an exception would
apply.
In the remainder of this section of this proposed rule, we propose,
in addition to the current exception due to a change in the
reassignment of billing rights (that is, change in TIN), to recognize a
new exception. Specifically, we propose that ASM heart failure
participants who meet certain specialty type redesignation requirements
may be excepted from specified model requirements. For each exception,
we discuss proposals around the requirements and process for notifying
us of a change that may warrant an exception. Finally, in accordance
with the proposed revisions to Sec. 512.710(a)(2) discussed earlier in
this section of this proposed rule, we make proposals at Sec.
512.710(c) to describe the effect and duration of an exception due to a
change in TIN or redesignation of primary specialty type.
(a) Exceptions Due to TIN Changes
In the CY 2026 PFS final rule (90 FR 49582 through 49583), we
finalized that an ASM participant who stops reassigning billing rights
to the TIN used to select the ASM participant and begins reassignment
to a new TIN during the same ASM performance year would no longer be
subject to specified ASM requirements for that ASM performance year
under either TIN if the ASM participant notifies us of the reassignment
change within 30 days. We explained that a TIN change during an ASM
performance year may limit our ability to determine continued ASM
participant eligibility and assess performance under the model using
consistent claims history and EBCM data.
Since the finalization of the CY 2026 PFS final rule, interested
parties have shared examples with us of additional circumstances,
beyond changes in reassignment, that impact a clinician's affiliation
with a particular TIN (for example, retirement from practice) and
inquired whether those circumstances would qualify an ASM participant
for exception from specific ASM requirements. Our finalized provisions
also do not account for situations when an ASM participant reassigned
their billing rights to a new TIN before the start of an ASM
performance year. After internal review, we believe that it would be
appropriate to address such circumstances in ASM's provisions.
Accordingly, we are making multiple proposals to simplify the
exception from specified model requirements based on TIN changes
including to recognize additional TIN change scenarios for possible
exception from specified ASM requirements.
First, we are proposing to redesignate the provisions at current
Sec. 512.710(c)(1), which describes the notification process for TIN
changes that occur during an ASM performance year, as new Sec.
512.710(c)(1)(i)(B). We propose to revise Sec. 512.710(c)(1) to
describe how we may determine an exception applies. Specifically, we
propose that an ASM participant who demonstrates the circumstances
described by an exception apply (that is, change in TIN or approved
primary specialty type redesignation) would be excepted from specified
ASM requirements, subject to CMS determination for the duration
specified for each exception. For each of these exception situations,
we discuss the proposed requirements that an ASM participant would be
required to meet and, later in this section of this proposed rule, the
duration of the exception.
Second, we propose at new Sec. 512.710(c)(1)(i) that an ASM
participant who (1) stops reassigning billing rights to the TIN we used
to select them as ASM participant for an applicable ASM performance
year and (2) satisfies the TIN change notification requirements at
proposed Sec. 512.710(c)(1)(i)(A) or Sec. 512.710(c)(1)(i)(B), as
applicable, may be excepted from specified ASM requirements. We believe
the addition of this provision provides additional clarity on how the
notification processes proposed at Sec. Sec. 512.710(c)(1)(i)(A) and
512.710(c)(1)(i)(B) could lead to an exception.
Third, we propose new provisions related to ASM participant TIN
changes that occur before the start of an ASM performance year. At
Sec. 512.710(c)(1)(i)(A), we propose that an ASM participant who stops
reassigning billing rights to the TIN we used to select them as an ASM
participant before the applicable ASM performance year must notify us
in writing no later than 60 days after the start of the applicable ASM
performance year; after receiving such notice, we may determine an
exception to specified ASM requirements applies for the ASM performance
year. We recognize that ASM participants may change organizational
affiliations between the time we select ASM participants and the start
of an ASM performance year. Based on our previously finalized
provisions related to the TIN change exception in the CY 2026 PFS final
rule, we believe that the same challenge of having consistent claims
history and EBCM data to evaluate ASM participant eligibility criteria
under the new TIN would apply in this circumstance and thus an
exception would be appropriate. We believe that requiring the ASM
participant to notify us in writing no later than 60 days after the
start of the ASM performance year would provide an adequate window to
provide us with notice of such change after we release the list of ASM
participants for a given ASM performance year.
Finally, we propose at Sec. 512.710(c)(1)(i)(B) that an ASM
participant who stops reassigning their
[[Page 43968]]
billing rights to the TIN we used to select them for participation in
ASM during an ASM performance year is not required to reassign billing
rights to a new TIN during the same ASM performance year to be
potentially eligible for an exception from specified ASM requirements.
We believe the proposed modification would capture additional
organizational affiliation changes, such as retirements, that merit an
exception from specified ASM requirements. We further believe this
proposal is consistent with the original intent of the TIN change
exception policy we finalized in the CY 2026 PFS final rule. We are
also proposing that an ASM participant who changes their TIN during an
ASM performance year must provide written notice of the change in a
form and manner determined by us within 30 days of stopping
reassignment to that TIN. We believe that adding this additional detail
on the form of the notification and required timing clarifies the
notification process for ASM participants.
We seek comment on our proposal at Sec. 512.710(c)(1) describing
the notice and determination process for an exception from specified
model requirements. We also seek comment on our proposal at Sec.
512.710(c)(1)(i) to describe the requirements for an exception from
specified model requirements for an ASM participant who stops
reassigning billing rights to the TIN we used to select them as an ASM
participant. We also seek comment on: (1) our proposed notification
process for TIN changes that occur before the start of an ASM
performance year described at Sec. 512.710(c)(1)(i)(A); (2) our
proposal to remove the requirement that an ASM participant who no
longer reassigns their billing rights to the TIN we used to select them
as an ASM participant during an ASM performance year must begin
reassigning billing rights to a new TIN to be eligible for exception as
described at Sec. 512.710(c)(1)(i)(B); and (3) our proposal that an
ASM participant must provide written notice of the change in TIN within
30 days of stopping reassignment of billing rights to the ASM
participant's TIN as described at Sec. 512.710(c)(1)(i)(B).
(b) Exceptions Due to Heart Failure-Related Specialty Type
Redesignations
In the CY 2026 PFS final rule, we did not propose or consider an
exception based on redesignations of specialty type made through
Medicare enrollment before or during an ASM performance year.
Since publication of the CY 2026 PFS final rule, we have received
interested parties' feedback that we should consider adjustments to ASM
participant eligibility determinations based on more recent Medicare
enrollment information related to specialty type, which is used to
derive the Medicare Part B claims-based specialty type that we use to
evaluate ASM participant eligibility criteria.
We believe that using historical data to evaluate ASM participant
eligibility criteria for each ASM performance year is still
appropriate. In the CY 2026 PFS final rule (90 FR 49583 through 49585),
we explained that determining a clinician's specialty type based on
historical data from 2 CYs before an ASM performance year provides an
objective and consistent approach because it allows us to use
historical claims data to evaluate clinician specialty type, as well as
the EBCM episode threshold, as part of the ASM participant eligibility
criteria. This approach also supports operational feasibility because
it enables us to provide advance notification for ASM participants to
prepare for the start of an ASM performance year.
However, we recognize that clinicians may not have had sufficient
time to formally update an out-of-date specialty type before the end of
CY 2025 because ASM was not finalized until November 2025. For example,
specialty type redesignations made in CY 2026 would not be reflected in
the CY 2025 data used to select final ASM participants for the 2027 ASM
performance year. Setting an appropriate scope of ASM participant
exceptions is important in a mandatory model such as ASM to preserve
the integrity of the model design and evaluation, and to ensure a
representative ASM participant population. While allowing unrestricted
ASM participant exceptions due to specialty type redesignations could
introduce selection bias and undermine the model test, we believe that
certain limited and clinically appropriate redesignations may warrant
consideration based on the timing of ASM's announcement and selection
of ASM participants.
Accordingly, we are proposing that ASM heart failure participants
who officially redesignate their primary specialty type through an
approved Medicare enrollment application (either PECOS or CMS-855 form
paper application) to a limited set of specialty types and demonstrate
proof of board certification would be excepted from specified ASM
requirements and ineligible for Medicare program waivers and the safe
harbor provisions available in the model for the applicable ASM
performance year and for all remaining ASM performance years in the ASM
test period. We further discuss the proposed duration of this specific
exception later in this section of this proposed rule.
Specifically, we propose at Sec. 512.710(c)(1)(ii) that we may
approve an exception from specified model requirements for an ASM heart
failure participant upon receipt of written notification of updated
Medicare enrollment to the following redesignated primary specialty
types described at Sec. 512.710(c)(1)(ii)(A): cardiac
electrophysiology, cardiac surgery, interventional cardiology, advanced
heart failure and transplant cardiology, and adult congenital heart
disease. We propose at Sec. 512.710(c)(1)(ii)(B) that an ASM heart
failure participant who redesignated their primary specialty type
through an approved Medicare enrollment application (either PECOS or
CMS-855 form paper application) would need to provide us written
notification of the approved redesignation, along with verification of
board certification in the newly designated primary specialty type
described under Sec. 512.710(c)(1)(ii)(A) within 30 days of the
effective date of the approved redesignation.
Recognizing an exception for ASM heart failure participants that
redesignate their specialty type to one of the proposed specialty types
would be appropriate because these specialty types reflect highly
specialized or procedure-focused practice areas that are distinct from
the broader management of cardiovascular disease and heart failure
captured under the cardiology specialty. Excepting cardiac
electrophysiology, cardiac surgery, and interventional cardiology would
be appropriate because these specialties are predominantly procedure-
focused and are generally organized around the performance of invasive
or technical interventions rather than the longitudinal medical
management of cardiovascular disease. Cardiac electrophysiology
primarily involves the diagnosis and treatment of cardiac arrhythmias
through procedures such as ablation and device implantation;
interventional cardiology centers on catheter-based interventions (for
example, percutaneous coronary intervention). Cardiac surgery involves
operative treatment for cardiac conditions. Advanced heart failure and
transplant cardiology specialists primarily manage patients with end-
stage heart failure, mechanical circulatory support, or transplant-
related care, while adult congenital heart disease specialists treat
individuals with complex congenital conditions that persist into
adulthood. Because the specialty types proposed for
[[Page 43969]]
exception represent narrower scopes of practice than general heart
failure management, their exception from specified requirements helps
ensure that ASM remains focused on specialists who manage heart failure
in a comprehensive and ongoing manner, thereby improving the
specificity and consistency of the ASM heart failure cohort.
To be excepted from the specified ASM requirements under this
proposal, we believe that the ASM participant must (1) officially
redesignate their primary specialty type to one of the specialty types
described earlier through an approved Medicare enrollment application
and (2) provide evidence of board certification in the redesignated
specialty to ensure that an exception to specified ASM requirements is
valid and appropriate. While Medicare enrollment requirements stipulate
a clinician must supply documentation supporting eligibility for
Medicare enrollment under Sec. 424.510(d), these enrollment
regulations do not specify a mechanism for substantiating specialty
type. Initial enrollment, revalidation, and any interim changes to an
existing enrollment require a physician to select a primary specialty
and attest that they meet all state or Federal requirements for their
selected primary specialty. Physicians must meet the same requirements
for any secondary specialty selected. They must also provide
information on the active certification relating to their selected
primary specialty type, specifically certification number, effective
data, certifying entity, and state where issued. If no certification is
associated with the selected primary specialty, then the physician must
report the certification relevant to the secondary specialty.\165\ MACs
have operational authority to validate reported information, including
requesting supporting documentation, if needed. In addition to
requiring the redesignation through a Medicare enrollment application,
we believe that requiring an ASM participant to report additional proof
of board certification in one of the proposed specialty types eligible
for exception would promote a more accurate approach to the exception
process while avoiding unrestricted or unverified exceptions that could
introduce selection bias into the model test. Further, all of the
proposed specialty types for exception have a certifying entity that
provides evidence of board certification. The American Board of
Internal Medicine provides board certification for cardiac
electrophysiology, interventional cardiology, advanced heart failure
and transplant cardiology, and adult congenital heart disease specialty
types. The American Board of Thoracic Surgery provides board
certification for the cardiac surgery specialty type. Therefore, we
believe that an ASM heart failure participant seeking an exception
would be able to produce evidence of board certification for all
specialty types proposed for exception.
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\165\ https://www.cms.gov/medicare/cms-forms/cms-forms/cms-forms-items/cms019477.
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We considered an alternative proposal whereby we would only
recognize specific specialty type redesignation-based exceptions that
occur during 2027 and 2028 ASM performance years to limit the number of
ASM participants potentially excepted. Based on the announcement of ASM
in the CY 2026 PFS final rule in November 2025, we believe that
potential ASM participants may not have had adequate time to officially
redesignate their primary specialty type such that it is reflected in
the Medicare Part B claims used to select ASM participants for these
ASM performance years. For example, a 2027 ASM participant who
redesignated their primary specialty type in CY 2026 would not have
that change reflected in the CY 2025 claims data used to evaluate their
eligibility. A similar timing challenge could occur for the 2028 ASM
performance year because we will use CY 2026 data to select ASM
participants for the 2028 ASM performance year. We believe that
finalization of ASM in the CY 2026 PFS final rule provided potential
ASM participants advanced notice to redesignate their specialty type,
if appropriate, for CY 2027, which is the year of data that we will use
to select ASM participants for the 2029 ASM performance year. However,
we recognize that appropriate specialty type redesignations could occur
after the 2028 ASM performance year and that allowing the potential for
an exception based on specific specialty type redesignations for a
longer period would retain consistency in the application of the
proposed exception for specified ASM requirements.
We considered but are not proposing exceptions based on specialty
type redesignations for ASM low back pain participants. Unlike cardiac
specialties, the specialty types included in the ASM low back pain
cohort typically do not have Medicare specialty types that reflect
further specialization that would be appropriate for excepting ASM low
back pain participants. We also believe that the larger number of
specialty types in the ASM low back pain cohort would naturally capture
common changes in specialty type by ASM low back pain participants over
time. For example, we would capture an anesthesiologist ASM low back
pain participant who redesignates their primary specialty type to pain
management or interventional pain management over the course of the ASM
test period through our existing use of historical Mediare Part B
claims to identify specialty type. Our rationale for recognizing
exceptions based on specialty type redesignation is to ensure each ASM
cohort represents specialists who can be appropriately held accountable
for longitudinal management of heart failure or low back pain.
Accordingly, we believe that the existing ASM low back pain participant
specialty type criteria, together with the minimum episode attribution
volume for the low back pain EBCM, accomplishes this objective and
allowing unrestricted exceptions based on specialty type redesignations
in the ASM low back pain cohort could introduce selection bias into the
model test.
We seek comment on the proposed timeline and documentation
requirements for notifying us of an ASM heart failure participant
specialty type redesignation for the purpose of determining an
exception proposed under Sec. 512.710(c)(1)(ii). We also seek comment
on the proposed specialty types--cardiac electrophysiology, cardiac
surgery, interventional cardiology, advanced heart failure and
transplant cardiology, and adult congenital heart disease--to which an
ASM heart failure participant may redesignate their primary specialty
type through an approved Medicare enrollment application to be
considered for an exception from specified ASM requirements. We further
seek comment on the proposed requirement to provide us with direct
evidence of board certification in one of the proposed specialty types
eligible for exception. We also seek comment on our alternative to only
consider exceptions for specific specialty type redesignations based on
notifications that occur during the 2027 and 2028 ASM performance
years. Finally, we seek comment on whether we should consider ASM low
back pain participant exceptions based on primary specialty type
redesignations, including rationale on specific specialty type
redesignations that we could consider for ASM low back pain
participants.
(c) Effect and Duration of Exceptions to Specific ASM Performance
Requirements
We propose at Sec. 512.710(c)(2) to define the effect of an
approved
[[Page 43970]]
exception on an ASM participant. Specifically, we propose that the ASM
participant with an approved exception would: (1) not be subject to
performance assessment described at Sec. 512.715, data submission
described at Sec. 512.720, and final scoring described at Sec.
512.745 for the applicable ASM performance year; (2) not be subject to
payment adjustments described at Sec. 512.750 for the corresponding
ASM payment year; (3) not be eligible for Medicare program waivers
available under the model described at Sec. 512.775 for the applicable
ASM performance year, and (4) not be eligible for the CMS-sponsored
model arrangements and patient incentives safe harbor described at
Sec. 512.765 for the period for which we determine an exception
applies. We believe that the proposed effect of an exception retains
the intent of the finalized provisions related to ASM participant
exclusions due to TIN changes in the CY 2026 PFS final rule while
adding new elements that strengthen program integrity. This proposal is
also similar to the effect of an ASM participant not meeting the ASM
participant eligibility criteria for an ASM performance year discussed
earlier in this section of this proposed rule.
We propose at Sec. 512.710(c)(3)(i) that an exception related to a
TIN change would be effective on the CMS-determined date and would only
apply for the applicable ASM performance year. We believe that limiting
an exception to a single ASM performance year would allow us to select
the ASM participant with the exception (that is, the same TIN/NPI
combination) for a future ASM performance year should the NPI again
reassign billing rights to that same TIN and meet ASM participant
eligibility criteria under that TIN.
We considered whether to extend an exception related to a TIN
change for the remainder of the ASM test period. However, we believe
that this approach could lead to unnecessary exceptions for later ASM
performance years, particularly in the case that an excepted ASM
participant begins reassigning billing rights to the same TIN under
which we previously selected them as an ASM participant, and excepted
them, for a previous ASM performance year.
We provide several illustrative examples of how the proposed
exception related to TIN changes would work in practice, including the
effect of such exceptions on the application of payment adjustments
under ASM. In our first example, ASM participant Dr. A (TIN A/NPI A)
receives a final score and an ASM payment multiplier for their
performance at TIN A in the 2027 ASM performance year. Dr. A receives
an exception for the 2028 ASM performance year based on termination of
billing rights to TIN A and reassignment of billing rights to TIN B.
Under TIN B, Dr. A remains located in the same mandatory geographic
area as they were located under TIN A. Dr. A is not required to meet
the specified ASM requirements under TIN A or TIN B for the 2028 ASM
performance year. However, because Dr. A began reassigning billing
rights to TIN B after the end of the 2027 ASM performance year but
before the end of the 2029 ASM payment year, we would apply the ASM
payment multiplier determined for the 2027 ASM performance year to
payments for Medicare Part B covered professional service claims
submitted by Dr. A under TIN B during the 2029 ASM payment year. We
refer readers to section III.D.2.g. of this proposed rule and Sec.
512.750(f) for additional information on payment adjustment provisions
related to TIN changes that occur after an ASM performance year but
before the end of the corresponding ASM payment year. We also note that
Dr. A in this example could be selected as an ASM participant under TIN
B for the 2030 ASM performance year if they meet ASM participant
eligibility criteria under TIN B based on CY 2028 data. In this
situation, Dr. A would be included in the list of ASM participants for
the 2030 ASM performance year.
We also provide an example of how the proposed exception due to TIN
changes would work for an NPI who is selected as an ASM participant
under multiple TIN/NPI combinations. As discussed in the CY 2026 PFS
final rule, we believe that it would be rare, but possible, for the
same NPI to be selected as an ASM participant under multiple TINs for
the same ASM performance year (90 FR 49602). An exception based on a
TIN change for one TIN/NPI combination does not affect the ASM
participant's obligation to meet specified ASM requirements under any
other TIN/NPI combination for which we selected the NPI as an ASM
participant. For example, Dr. B (NPI B) is selected as an ASM
participant under TIN C and TIN D for the 2028 ASM performance year. If
Dr. B stops reassigning billing rights to TIN C during the 2028 ASM
performance year and receives an exception for the 2028 ASM performance
year, then Dr. B is excepted from the specified ASM requirements under
TIN C but must continue to meet ASM's requirements under TIN D for the
2028 ASM performance year.
We propose at Sec. 512.710(c)(3)(ii) that an exception related to
specialty type redesignation would be effective on the CMS-determined
date and would apply for the applicable ASM performance year and remain
effective for all ASM performance years in the remainder of the ASM
test period. We believe that excepting ASM participants for specified
specialty type redesignations for the remainder of the ASM test period
would be appropriate since these ASM participants do not represent the
target specialty type of an ASM cohort, and would, therefore, improve
the specificity and consistency of the ASM cohort for the purposes of
performance comparison.
We considered effectuating the exception related to specialty type
redesignation type on the CMS-determined date and only having it apply
for the applicable ASM performance year. However, we believe that
effectuating the exception for the remainder of the ASM test period
would be preferrable since we believe an ASM participant would be
unlikely to revert to their previous primary specialty type
redesignation during the remainder of the ASM test period.
We provide several illustrative examples of how the proposed
exception related to specialty type redesignations would work in
practice, including the effect of such exception on the application of
payment adjustments under ASM. For example, consider ASM heart failure
participant Dr. C (TIN E/NPI C) who receives a final score and an ASM
payment multiplier for their performance under TIN E for the 2027 ASM
performance year. Dr. C receives an exception during the 2028 ASM
performance year because they redesignated their primary specialty type
to cardiac electrophysiology as part of their Medicare enrollment and
met the notification requirements. Dr. C would be excepted from the
specified ASM requirements for the 2028 ASM performance year and the
remainder of the ASM test period under TIN E. However, they would
continue to receive payment adjustments on their Medicare Part B
covered professional service claims submitted under TIN E during the
2029 ASM payment year based on the ASM payment multiplier determined
for their performance during the 2027 ASM performance year. As we
emphasized in the CY 2026 PFS final rule (90 FR 49696 through 49699),
our goal is to maintain accountability for an ASM participant's
performance for a given ASM performance year through performance-based
payment adjustments during the corresponding ASM payment year.
We also note that a specialty type redesignation exception would
apply to
[[Page 43971]]
all TIN/NPI combinations for which we selected the NPI as an ASM
participant, provided the notification requirements are met and we
approve an exception for each TIN/NPI combination. For example, Dr. D
(NPI D) is considered an ASM heart failure participant under TIN F and
TIN G for the 2028 ASM performance year. Dr. D redesignates their
primary specialty type to interventional cardiology as part of their
Medicare enrollment during the 2028 ASM performance year and meets the
notification requirements for both TIN F and TIN G. If we approve the
exception, Dr. D would be excepted from specified ASM requirements for
the 2028 ASM performance year and the remainder of the ASM test period
under both TIN F and TIN G.
We seek comment on the proposed effect of an exception from
specified ASM requirements at Sec. 512.710(c)(2). We also seek comment
on the proposed duration of an exception related to TIN changes as
proposed at Sec. 512.710(c)(3)(i), as well as the alternative we
considered of setting the duration of a TIN change-related exception as
the remainder of the ASM test period. We seek comment on the proposal
at Sec. 512.710(c)(3)(ii) that an exception related to specialty type
redesignation would apply for the ASM performance year for which we
approve the exception and for the remainder of the ASM test period.
Finally, we seek comment on the alternative we considered to effectuate
an exception related to specialty type redesignation for the applicable
ASM performance year only.
(5) ASM Participant Terminations
In the 2026 PFS final rule, we finalized application of the
Standard Provisions for Mandatory Innovation Center Models (42 CFR part
512, subpart A) to ASM (90 FR 49720). These provisions describe actions
that we may take to remediate actions associated with risks to program
integrity. We discussed how the standard provisions are not intended to
encompass all the terms and conditions that would apply to each
Innovation Center model, because each model has unique design features
and implementation plans that may require additional, more tailored
provisions.
In addition to the remedial actions enumerated in the standard
provisions at Sec. 512.160(b), we now propose to include an additional
remedial action for purposes of ASM whereby we could terminate an ASM
participant from participation in the model upon determining that one
or more grounds for remedial action described in Sec. 512.160(a) has
taken place. Grounds for remedial action include, for example, when a
model participant has: failed to comply with terms of the Innovation
Center Model or applicable Medicare program requirements; taken action
to threaten the health or safety of a patient; submitted false data or
made false representations in connection with the Innovation Center
model; or undergone a change in control that presents a program
integrity risk.
We also propose that we could terminate an ASM participant if we
determine that their continued participation would be inconsistent with
the purposes of ASM or applicable law.
Under this proposal, any termination of an ASM participant's
participation would occur only upon a determination by CMS. For the
avoidance of doubt, our proposal would not establish a right for an ASM
participant to terminate their participation.
We believe that reserving authority to terminate an ASM
participant's participation, where appropriate, such as in
circumstances involving egregious conduct, would provide additional
protections for the program and for beneficiaries. We propose to codify
this provision at Sec. 512.710(h) and to include a corresponding
reference to termination in proposed revised Sec. 512.710(a)(1), which
addresses the duration of participation under ASM.
We seek comment on this proposal at Sec. 512.710(h).
c. Data Submission
(1) Background
We finalized in the CY 2026 PFS final rule that an ASM participant
must meet established data submission requirements across the quality,
improvement activities, and Promoting Interoperability ASM performance
categories, consistent with Sec. Sec. 512.725, 512.735, and 512.740,
respectively (90 FR 49596 through 49605). We did not establish data
submission requirements for the cost ASM performance category or for
administrative claims-based quality measures as we will calculate
performance on these measures using administrative claims data.
For the quality ASM performance category, we require the submission
of numerator and denominator data for at least one required quality
measure that satisfies the data completeness criteria (that is, data is
submitted on at least 75 percent of the ASM participant's patients that
meet a quality measure's denominator criteria). ASM participants in
small practices (that is, a TIN with 15 or fewer clinicians) may submit
quality data at the group level (that is, TIN level) while ASM
participants in non-small practices must submit quality measure data at
the individual clinician level (that is, TIN/NPI level). Data
submission for the improvement activities ASM performance category
requires an ASM participant to attest at the group level (that is, TIN
level) that the required activities are completed by all ASM
participants within the TIN. Finally, for the Promoting
Interoperability ASM performance category, ASM participants must submit
all required measure data (or claim any applicable exclusions),
attestations, CMS Electronic Health Record (EHR) Certification ID, and
performance period dates at the group level (that is, TIN level). Data
submission for the Promoting Interoperability ASM performance category
may reflect data from clinicians who are not ASM participants.
Regardless of the data submission level for each ASM performance
category, each ASM participant receives an individual-level final score
and corresponding ASM payment adjustment factor and ASM payment
multiplier, which is used to adjust payments for each ASM participant's
Medicare Part B covered professional service claims.
(2) Quality ASM Performance Category Data Submission for ASM
Participants in Small Practices
We finalized policies at Sec. 512.720(a) addressing data
submission for the quality ASM performance category, including the
requirement that quality measure data be submitted at the individual
level (that is, TIN/NPI level). However, as finalized at Sec.
512.720(f), an ASM participant that is in a small practice may report
quality ASM performance category data at the group level (that is, TIN
level).
After reviewing our provisions finalized in the CY 2026 PFS final
rule, we believe it would improve readability and overall clarity of
the regulatory text if we addressed the quality data submission policy
for ASM participants in small practices together with the generally
applicable policies for each ASM performance category, which appear at
Sec. 512.720(a).
Accordingly, we propose to remove existing Sec. 512.720(f) and
instead address our quality ASM performance category data submission
policy for ASM participants in small practices at Sec.
512.720(a)(1)(i)(C). In relocating this regulatory text, we also
propose to make technical clarifying edits to better reflect our policy
intent that an ASM participant in a small practice has the option to
submit ASM quality measure
[[Page 43972]]
data at either the group level (that is, TIN level) or the individual
level (that is, TIN/NPI level). Our intent is to provide ASM
participants in small practices an additional flexibility in reporting
ASM quality measure data.
We propose conforming adjustments at Sec. 512.720(a)(1)(i)(A) to
correct a minor typographical error and at Sec. 512.720(a)(1)(i)(B) to
cross-reference to proposed new Sec. 512.720(a)(1)(i)(C). Our proposed
reorganization of these provisions would not substantively change the
policy under existing provisions, but we believe the proposed changes
would bring greater clarity to the structure of the regulation and
regulatory text.
We invite public comment on these proposed adjustments to Sec.
512.720(a)(1)(i).
(3) Improvement Activities ASM Performance Category Data Submission
In the CY 2026 PFS final rule, we finalized that ASM participants
submit improvement activity ASM performance category data by attesting
to the completion of required improvement activities at the group level
(that is, TIN level) (90 FR 49599 through 49602). We believed that
group-level data submission would be appropriately reflective of the
team-based care and coordination envisioned by the improvement
activities (90 FR 49601). We also believed that group-level data
submission for the improvement activities ASM performance category
would reduce administrative burden (90 FR 49601). In subsequent sub-
regulatory guidance, we clarified that a group-level attestation for
completing a required improvement activity means that all ASM
participants within a TIN successfully completed the requirements of
that improvement activity for the applicable ASM performance year. We
also clarified that a clinician who is not an ASM participant, but who
has reassigned billing rights to a TIN that includes one or more ASM
participants, would not be subject to any ASM participation obligations
solely on that basis, including the requirements of the improvement
activities ASM performance category.
Since the publication of the CY 2026 PFS final rule, we have
received feedback from interested parties that group-level data
submission for the improvement activities ASM performance category may
have unintentional consequences on scoring for ASM participants in
certain circumstances. For example, if only 8 ASM participants in a TIN
with 10 ASM participants complete a required improvement activity, then
the group could not submit an attestation that all ASM participants
within the group completed the improvement activity. In this example,
each of the 8 ASM participants who completed the improvement activity
would receive a 10-point deduction on their final score. While the
group-level data submission for the improvement activities ASM
performance category may reduce administrative burden related to data
reporting, we believe it would be appropriate to adjust these data
submission provisions to reduce the likelihood of final score penalties
on an ASM participant who fully or partially completes the requirements
of the improvement activities ASM performance category and associated
data submission requirements.
Accordingly, we propose at Sec. 512.720(a)(1)(ii)(B) to allow an
ASM participant to submit data for the improvement activities ASM
performance category at either the group level (that is, TIN level) or
the individual level (that is, TIN/NPI level). We believe this proposal
would offer greater flexibility in how an ASM participant or their
affiliated group submits data for the improvement activities ASM
performance category depending on their specific circumstances and data
submission preferences. While we believe that many of ASM's improvement
activities would be jointly implemented by ASM participants within a
group to improve team-based care and coordination, we believe that this
added data submission flexibility would mitigate the chance of an
unintended negative adjustment to the final score of an ASM participant
who fully or partially meets the improvement activities ASM performance
category requirements. We note that this proposal would not affect how
an ASM participant or its affiliated TIN may choose to structure a CCA
required under IA-2.
We seek comment on our proposal at Sec. 512.720(a)(1)(ii)(B) to
allow ASM participants to attest to completing ASM's improvement
activities at either the group level (that is, TIN level) or the
individual level (that is, TIN/NPI level).
(4) Treatment of Multiple Data Submissions for the Quality, Improvement
Activities, and Promoting Interoperability ASM Performance Categories
In the CY 2026 PFS final rule, we finalized policies addressing the
treatment of multiple data submissions for the quality, improvement
activities, and Promoting Interoperability ASM performance categories
at Sec. 512.720(e) (90 FR 49604 through 49606). For the quality and
improvement activities ASM performance categories, when we receive
multiple data submissions for an individual ASM participant from
multiple organizations (for example, a qualified registry, practice
administrator, or an electronic health record (EHR) vendor), we
calculate and score each submission and assign the highest score to the
ASM participant. When we receive multiple data submissions for an
individual ASM participant from the same organization, we score the
most recent submission. For the Promoting Interoperability ASM
performance category, we calculate each submission and assign the
highest score.
We believe our policies for multiple data submissions would be
clearer if we addressed each ASM performance category separately,
rather than discussing the quality ASM performance category and the
improvement activities ASM performance category together. Accordingly,
we propose to make technical modifications to regulatory text
describing multiple data submissions, such that Sec. 512.720(e)(1)
would address the quality ASM performance category, Sec. 512.720(e)(2)
would address the improvement activities ASM performance category, and
Sec. 512.720(e)(3) would address the Promoting Interoperability ASM
performance category. Except for the proposed new policy for small
practices at proposed Sec. 512.720(e)(1)(iii), discussed later in this
section of this proposed rule, the remaining proposed revisions to
Sec. 512.720(e)(1) would not constitute substantive changes from the
policies finalized in the CY 2026 PFS final rule. Rather, those
proposed revisions would reorganize the existing provisions and make
clarifying modifications to the regulatory text.
Specifically, we propose to:
Address the multiple data submissions policy for the ASM
quality performance category at Sec. 512.720(e)(1), the improvement
activities ASM performance category at Sec. 512.720(e)(2), and the
Promoting Interoperability ASM performance category at Sec.
512.720(e)(3). To accomplish this, we would:
++ Add the informative heading ``Quality ASM performance category''
to Sec. 512.720(e)(1).
++ Revise Sec. Sec. 512.720(e)(1)(i) and 512.720(e)(1)(ii) to
reflect our policy for scoring multiple data submissions for the
quality ASM performance category and make technical revisions to the
text.
++ Redesignate existing Sec. 512.720(e)(2) describing our multiple
data submission policy for the Promoting Interoperability ASM
[[Page 43973]]
performance category as new paragraph Sec. 512.720(e)(3)(i).
++ Redesignate the portions of Sec. Sec. 512.720(e)(1)(i) and
512.720(e)(1)(ii) that address our multiple data submission policy for
the improvement activities ASM performance category to Sec. Sec.
512.720(e)(2)(i) and 512.720(e)(2)(ii).
++ Add the informative heading ``Improvement activities ASM
performance category'' at Sec. 512.720(e)(2).
++ Revise newly redesignated Sec. Sec. 512.720(e)(2)(i) and
512.720(e)(2)(ii) to make technical clarifications for the treatment of
multiple data submissions for the improvement activities ASM
performance category.
++ Add the informative heading ``Promoting Interoperability ASM
performance category'' to new paragraph Sec. 512.720(e)(3).
We invite public comment on this proposed reorganization of Sec.
512.720(e).
(a) Multiple Data Submissions for the Quality ASM Performance Category
for ASM Participants in Small Practices
In the CY 2026 PFS final rule, we finalized that ASM participants
in small practices may report quality measures in the quality ASM
performance category at the group level (that is, TIN level) (90 FR
49602). We finalized this policy because we recognize that reporting
quality measures at the individual clinician level (that is, TIN/NPI
level) may be particularly burdensome for ASM participants in small
practices who may have limited capacity for data aggregation and
reporting. We believe that EHR customization for individual-level
reporting, and the costs associated with updating reporting mechanisms,
may pose a larger burden on ASM participants in small practices
compared to ASM participants in larger practices because small
practices may not have the requisite support, such as infrastructure or
staffing, to facilitate individual-level reporting. Importantly, this
reporting flexibility does not change ASM's intention to measure
individual ASM participant performance; rather, this flexibility is
limited to the reporting and scoring of ASM non-administrative claims-
based quality measures. All other reporting and scoring requirements
for the cost and quality ASM performance categories remain at the
individual ASM participant level regardless of practice size. ASM
participants in small practices would retain the option to report
quality measure data at the individual level if they choose.
After internal review of the provisions finalized in the CY 2026
PFS final rule, we believe that permitting multiple submissions at
different reporting levels within a small practice could create
unintended incentives and scoring effects. If multiple reporting levels
are permitted within the same small practice, an ASM participant's
quality ASM performance category score could depend in part on the
reporting level used, rather than on a consistent approach to reporting
and evaluating quality performance. For example, a small practice could
submit individual-level data for higher-performing ASM participants and
group-level data for lower performing ASM participants. This
variability could reduce comparability across ASM participants and
create inconsistent scoring outcomes among ASM participants in similar
practice arrangements. We believe ASM participants in small practice
should report quality data at the reporting level that best meets their
needs and capabilities.
To ensure fair and consistent scoring of the quality ASM
performance category, we are proposing at Sec. 512.720(e)(1)(iii) that
if we receive any quality ASM performance category data at the group
level (that is, TIN level) from an ASM participant in a small practice,
we would score the group-level submission and assign that score to all
individual ASM participants in the small practice. This proposal would
mean that any individual-level (that is, TIN/NPI-level) submission
received for any ASM participants in that small practice would not be
scored if any group-level quality data submission is received.
We believe this proposal would maintain the desired reporting
flexibility to lower the administrative burden for ASM participants in
small practices while preserving the integrity of the ASM scoring
framework. Specifically, ASM participants in small practices would
continue to have the option to report non-administrative claims-based
ASM quality measures at either the group or individual level. Our
proposed policy would mitigate the opportunity for ASM participants in
small practices to submit data at multiples levels most opportune to
achieve a higher score and establish a consistent scoring framework so
that ASM participants in small practices are encouraged to submit
required data based on needs and capabilities, rather than strategic
performance considerations. Table B-D1 in this section of this proposed
rule summarizes existing finalized policies and new proposals relating
to our treatment of multiple data submissions for the quality ASM
performance category.
[[Page 43974]]
[GRAPHIC] [TIFF OMITTED] TP16JY26.050
We seek comment on our proposal at Sec. 512.720(e)(1)(iii) to
score any group-level quality data submission received from small
practices and assign that score to all ASM participants in the small
practice regardless of any individual-level quality data submission
received for individual ASM participants in that same small practice.
d. Quality ASM Performance Category
(1) Background
As discussed in the CY 2026 PFS final rule, the quality ASM
performance category supports the broader goals of the model by
incentivizing improvements in the quality of care and reductions in
unnecessary or low-value services for patients with heart failure and
low back pain. To accomplish these objectives, we finalized in the CY
2026 PFS final rule the use of ASM cohort-specific quality measure sets
at Sec. 512.725(b) (heart failure) and Sec. 512.725(c) (low back
pain) (90 FR 49606). ASM participants must report all measures
applicable to their ASM cohort, with administrative claims-based
measures calculated by us. This structure is similar to other CMS
programs, such as MIPS Value Pathways (MVPs), that entail reporting on
a clinically relevant subset of measures tailored to an eligible
clinician's specialty and patient population. It also minimizes
reporting burden, promotes consistency in measurement over the duration
of the ASM test period, and supports rigorous evaluation by maintaining
a stable set of quality indicators.
In finalizing these policies, we sought to ensure that each ASM
cohort-specific quality measure set reflects agency goals to advance
value-based care by linking payment to meaningful improvements in
clinical outcomes and beneficiary experience. The measures selected for
ASM represent a mix of utilization-focused measures, evidence-based
care measures, and patient-reported outcome or experience measures.
This structure supports nationwide measurement efforts focused on
outcomes, safety, and patient experience.
We intend for the quality measure sets applicable to each ASM
cohort to remain stable throughout the ASM test period; however, we may
propose additions or removals through notice-and-comment rulemaking if
refinements to the measure sets are warranted. Such updates may be
considered in response to interested parties' feedback, changes in
clinical guidelines, updates to measures used in ASM or other CMS
programs, or the development of new quality measures. This framework
keeps the quality ASM performance category aligned with current
clinical practice while providing predictability that may reduce
administrative burden over time.
(2) Low Back Pain Quality Measure Set
(a) Low Back Pain Imaging Measure for the ASM Low Back Pain Cohort
In the CY 2026 PFS proposed rule, we proposed inclusion of the
``Magnetic Resonance Imaging (MRI) Lumbar Spine for Low Back Pain,
Respecified to Be Relevant to ASM Participants Treating Low Back Pain''
measure in the ASM low back pain quality measure set (90 FR 32593
through 32597), but did not finalize its inclusion based on interested
parties' feedback (90 FR 49616 through 49618). We indicated in the CY
2026 PFS final rule that we intended to revisit the inclusion of this
measure in future notice-and-comment rulemaking (90 FR 49617). We
indicated revisiting because the ASM low back pain cohort had only four
quality measures, and none were focused on excess utilization or
efficiency. As our goal is to have a well-rounded measure set for each
ASM cohort that includes this focus area, we sought to include a
measure that would complete the ASM low back pain quality measure set.
We are proposing at Sec. 512.725(c)(5) to include the ``Magnetic
Resonance Imaging (MRI) Lumbar Spine for Low Back Pain (modified for
ASM)'' measure in the ASM low back pain quality measure set. This
proposal would meet the goals of the ASM low back pain cohort's quality
measure set of having an excess utilization focused measure. This
measure is modified from the
[[Page 43975]]
``Magnetic Resonance Imaging (MRI) Lumbar Spine for Low Back Pain''
measure that was specified for use in hospital outpatient departments
at the facility level and previously included in the Hospital
Outpatient Quality Reporting Program (HOQRP) as OP-8 (73 FR
68766).\166\ While we removed the measure from the HOQRP in 2017 due to
limited reliability from low average facility-level volumes, we have
since re-evaluated the measure for use in ASM. In reassessing this
measure, we considered interested parties' feedback, technical expert
input, and measure reevaluation activities. Commenters and experts
indicated that, while the clinical concept remains important for
assessing low-value imaging, the prior specification presented
challenges related to attribution at the facility level, small sample
sizes, and limited applicability to certain care delivery contexts.
Interested parties also recommended exploring refinements to improve
measure reliability and alignment with clinician decision-making in
ambulatory specialty settings.
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\166\ Hospital Outpatient Quality Reporting [verbar] Partnership
for Quality Measurement. P4qm.org. Published 2025. Accessed April
23, 2025. https://p4qm.org/taxonomy/term/216.
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In response, we have made targeted specification modifications to
improve the measure's applicability and statistical reliability in the
ASM context. We believe these modifications address the previously
identified limitations while preserving the measure's clinical intent
of reducing unnecessary imaging for low back pain.
We believe the proposed administrative claims-based quality measure
would effectively evaluate overuse and incentivize reductions in
inappropriate MRI imaging for low back pain. Routine imaging (such as
MRI) is not recommended for patients with non-specific low back pain in
the absence of certain clinical indicators and concerning
features.\167\ However, analyses have shown that a significant
proportion of patients with low back pain undergo imaging, often within
the first few weeks of symptom onset, despite the lack of clear
indication.\168\ Overuse of imaging for low back pain can lead to
unnecessary health care costs and potential patient harm from the
cascade effect, where MRI findings, many incidental, may prompt further
unnecessary testing or procedures.169 170 By including this
measure in the ASM low back pain quality measure set, ASM would aim to
incentivize adherence to evidence-based guidelines and a reduction of
unnecessary MRIs for patients with uncomplicated low back pain, where
an MRI is not clinically indicated, particularly in the initial stages
of evaluation and management. We believe this could also improve
patient experience to the extent it reduces time spent at medical
appointments and out-of-pocket health care costs. Furthermore, as an
administrative claims-based quality measure, ASM low back pain
participants would not assume new reporting requirements for this
measure. We would provide detailed measure information for the MRI
Lumbar Spine for Low Back Pain (modified for ASM) on the ASM website
before the start of the 2027 ASM performance year, if finalized, to
educate ASM participants on how they would be measured.
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\167\ North American Spine Society. Clinical Guidelines for
Multidisciplinary Spine Care: Diagnosis and Treatment of Low Back
Pain. North American Spine Society; 2020. https://www.spine.org/Portals/0/assets/downloads/ResearchClinicalCare/Guidelines/LowBackPain.pdf.
\168\ Medicare Payment Advisory Commission. Health Care Spending
and the Medicare Program: A Data Book. Medicare Payment Advisory
Commission; July 2021. Accessed July 7, 2026. https://www.medpac.gov/wp-content/uploads/2021/10/July2021_MedPAC_DataBook_Sec7_SEC.pdf.
\169\ Litkowski PE, Smetana GW, Zeidel ML, Blanchard MS. Curbing
the Urge to Image. The American Journal of Medicine.
2016;129(10):1131-1135. doi: https://doi.org/10.1016/j.amjmed.2016.06.020.
\170\ Chou R. Diagnostic Imaging for Low Back Pain: Advice for
High-Value Health Care From the American College of Physicians.
Annals of Internal Medicine. 2011;154(3):181. doi: https://doi.org/10.7326/0003-4819-154-3-201102010-00008.
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Our modifications seek to improve clinical validity and reliability
for the purposes of ASM. Two of our modifications were related to
denominator exclusions and the measure's performance period. We also
made modifications to provider attribution, minimum case count, and the
lookback period for antecedent care, for which we offer alternative
options that seek comment on. We believe the modifications we propose
in this proposed rule as part of the ``Magnetic Resonance Imaging (MRI)
Lumbar Spine for Low Back Pain (modified for ASM)'' measure to be
appropriately tailored to measure performance of ASM participants
ordering inappropriate MRIs for patients with low back pain.
We seek comment on the inclusion of MRI Lumbar Spine for Low Back
Pain (modified for ASM) measure in the ASM low back pain quality
measure set at Sec. 512.725(c)(5).
We discuss modifications to the measure's specifications in the
remainder of this section of this proposed rule, including seeking
comment on potential alternatives to the proposed modifications related
to provider attribution, minimum case count, and the lookback period
for antecedent care.
(i) Denominator Exclusions
We conducted an evaluation of the measure's denominator exclusions
to ensure that they reflect current clinical guidelines and
appropriately identify cases where early lumbar spine imaging is
clinically justified. This evaluation focused on exclusions that
previously removed a large number of cases under the OP-8
specifications and involved reviewing each diagnosis code individually.
Removing a large number of cases in OP-8 presented risks to the
applicability and reliability of the measure.
We identified three clinical areas that had a large number of
exclusions: cancer diagnoses, neurological impairment, and autoimmune
or inflammatory conditions. Physicians assessed each code under these
categories for appropriateness to include in the measure denominator.
Most conditions, such as ``red flag'' signs and symptoms and for
malignant neoplasms and autoimmune disorders where imaging would be
warranted (regardless of completion of conservative therapy), were
maintained as denominator exclusions. Conditions, such as benign
neoplasm of the colon and hemangioma of skin and subcutaneous tissue,
were removed as denominator exclusions since their presence would not
warrant an immediate MRI for a patient with low back pain; the
condition alone would not preclude a patient with low back pain from
attempting conservative therapy prior to receiving a lumbar MRI. To
improve clinical validity and acceptability, conditions and diagnoses
were not removed as denominator exclusions if they were present in the
list of denominator exclusions in the Healthcare Effectiveness Data and
Information Set (HEDIS) Use of Imaging Studies for Low Back Pain
measure.\171\ Under this approach, we ultimately aligned with the same
exclusion logic used in the HEDIS Use of Imaging Studies for Low Back
Pain measure and only diagnosis codes present in that measure and
supported by clinical review remained as denominator exclusions in our
ASM measure. As a result of these refinements, the ASM measure's
exclusion criteria differ from the prior OP8 specification in these
three clinical areas with the goal of
[[Page 43976]]
more closely aligning to evidence-based practice guidelines.
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\171\ National Committee for Quality Assurance. Use of Imaging
Studies for Low Back Pain (LBP). NCQA, https://www.ncqa.org/report-cards/health-plans/state-of-health-care-quality-report/use-of-imaging-studies-for-low-back-pain-lbp/. Accessed 6 Apr. 2026.
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In our analysis, these changes result in the inclusion of a
significant number of imaging studies that would previously have been
excluded, representing 52 percent of the cases that would have been
removed under the earlier specification. Retaining these cases
strengthens this measure by increasing denominator volume and improving
our ability to identify potentially unnecessary imaging. We believe
these refinements enhance the measure's clinical validity by ensuring
that exclusions are limited to diagnoses that represent appropriate
indications for more immediate imaging that do not warrant a prior
trial of conservative therapy.
(ii) Performance Period
We evaluated the performance period for the measure to ensure that
ASM participant-level scores are reliable and suitable for use in the
model's quality assessment framework. The original HOQRP version of the
measure used a single-year performance period, which limited the number
of eligible MRI studies available for scoring and contributed to
concerns about measure reliability.\172\ To address these issues, we
tested an expanded performance period that included all eligible lumbar
spine MRI studies occurring within a rolling 24-month window. Under
this approach, each MRI meeting denominator criteria during the 2-year
period was included in measure calculation, thereby significantly
increasing the number of cases available for analysis. Testing showed
that the expanded 2-year performance period resulted in approximately a
100 percent increase in denominator volume relative to a 1-year period.
This increase in case volume improved the precision of ASM participant-
level estimates and reduced small-sample volatility, particularly for
clinicians with lower annual MRI volumes. We believe that a 2-year
performance period enhances measure stability and supports more
dependable performance assessment across all ASM low back pain
participants and overcomes limitations and concerns that existed when
the measure existed in the HOQRP. This is especially important for
utilization measures, where annual case counts can vary substantially
among specialties and practice types. Based on these findings, we
believe that a rolling 24-month period provides the most robust and
actionable representation of clinician imaging practices.
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\172\ Hospital Outpatient Specifications Manuals, Hospital
Outpatient Quality Reporting. CMS.gov. Accessed March 27, 2026.
https://qualitynet.cms.gov/outpatient/specifications-manuals.
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(iii) Provider Attribution
The management of low back pain often involves several specialists
over an extended period, and diagnostic and treatment decisions
typically develop through multiple clinical encounters rather than a
single visit. In modifying the original HOQRP measure for use in ASM,
we had to address how to transition the measure from its original
hospital outpatient department attribution method, which assigned
imaging only to the facility that billed the MRI claim, to an approach
that reflects physician-level accountability. This work included
evaluating a single-participant attribution method that assigns each
MRI to the physician with the highest number of qualifying encounters
during the lookback period and a multiple-participant attribution
method that assigns the MRI to all physicians who provided qualifying
services to the patient. Testing showed that the multiple-participant
method increased the number of attributed MRI studies by roughly 26
percent after exclusions, which strengthened measure stability and
improved representation of the various physicians involved in that
beneficiary's care. Multiple attribution better reflects real-world
care patterns, particularly in increasingly common cases where
beneficiaries receive longitudinal care by different team members over
time. This approach also supports ASM's goals by recognizing the shared
nature of clinical responsibility for decisions that influence
downstream utilization and patient outcomes. Also, including all
clinicians who contributed meaningfully to the beneficiary's care
ensures that performance assessment captures the full set of ASM low
back pain participants who may influence imaging decisions. We believe
this attribution method provides a more complete and accurate
understanding of imaging practices within the ASM low back pain cohort.
For these reasons, we are proposing multiple-participant attribution.
We also considered an alternative approach that would attribute
each MRI to a single physician. Under this option, an MRI would be
assigned to the ASM participant who furnished the highest number of
qualifying encounters during the attribution window, which reflects a
single point of clinical responsibility for many beneficiaries. This
approach would provide a more streamlined assignment method and could
reduce attribution complexity for the measure, but may not be
reflective of real-world practice patterns and results in fewer
attributed beneficiaries per ASM participant and thus slightly lower
measure reliability.
We seek comment on the proposed use of a multiple-participant
attribution method for this quality measure. We also seek comment on
the alternate proposal of an attribution method involving a single ASM
participant.
(iv) Minimum Case Count
We evaluated the appropriate minimum case count threshold for the
MRI Lumbar Spine for Low Back Pain (modified for ASM) measure to ensure
that clinician-level performance scores are reliable for use in the
model's quality assessment framework. Low case volumes may produce
substantial variation in provider scores and a wider distribution of
results, which could reduce the measure's ability to distinguish true
performance differences. At lower thresholds, such as one or 10 cases,
our analysis found that many ASM low back pain participants would have
insufficient volume to support stable estimates, and reliability
decreased accordingly. At a threshold of 20 cases, the measure showed
stronger reliability and a narrower distribution of scores across ASM
participants, indicating that estimates were more consistent and
reflective of meaningful patterns of imaging use. The threshold of 20
cases aligns with the ASM participant eligibility criteria that, in
part, requires an ASM low back pain participant to have historically
been attributed at least 20 low back pain EBCM episodes. The threshold
of 20 cases also aligns with the case minimums for the other quality
measures in the ASM low back pain quality measure set. This alignment
ensures that the case count threshold is both operationally feasible
and representative of the expected care volume for ASM participants. In
addition, maintaining a minimum of 20 cases reduces the influence of
isolated or atypical events that may disproportionately affect results
when volumes are low. The analysis further showed that a substantial
proportion of ASM low back pain participants would continue to meet
eligibility for scoring at this case threshold, preserving the ability
to assess quality performance across a broad ASM participant
population. We believe that maintaining a minimum of 20 cases
appropriately balances inclusiveness and methodological rigor. For
these reasons, we propose a threshold of 20 cases for the MRI Lumbar
Spine for Low Back Pain (modified for ASM) measure.
We also considered an alternative minimum case count of 10 for the
MRI
[[Page 43977]]
Lumbar Spine for Low Back Pain (modified for ASM) measure. A threshold
of 10 would allow a greater number of ASM low back pain participants to
be scored on the measure, particularly those with smaller patient
panels or lower annual imaging volume. Although reliability is lower at
this threshold relative to a minimum of 20 cases, a 10-case minimum
would offer meaningful insight into specialist practice patterns while
expanding the proportion of ASM low back pain participants scored on
the measure.
We seek comment on the proposed minimum case count of 20. We also
seek comment on the alternate proposal of a minimum case count of 10.
(v) Lookback Period
We evaluated the attribution lookback period to determine the
timeframe during which clinician services should be considered for
assigning each lumbar spine MRI to ASM low back pain participants. The
measure needs a lookback period long enough to capture clinical
encounters that inform decisions about imaging, while still maintaining
a clear and comprehensive lookback approach. Chronic low back pain is
managed over extended periods, and patients frequently receive
evaluation and treatment, and require care coordination from multiple
clinicians during this time. Based on these care patterns, we examined
whether a longer window would more accurately identify the set of
clinicians who meaningfully influence imaging decisions. Testing
demonstrated that a 365-day lookback period compared to a shorter
window like 90-days substantially increased the number of attributed
MRI studies by approximately 27 percent. We believe a 365-day period
better reflects the longitudinal nature of chronic low back pain
management and ensures that attribution captures the full course of
care that precedes a patient's imaging event. A full-year window also
aligns with the model's annual performance period and improves
consistency across the various quality measures included in the model.
We believe that adopting a 365-day lookback window strengthens the
completeness of performance assessment by ensuring that clinicians who
contribute meaningfully to care are appropriately included. For these
reasons, we are proposing to use a 365-day lookback period for
attribution of MRI studies within the measure.
We also considered an alternative 120-day lookback period. This
approach would limit attribution to ASM low back pain participants who
furnished lower back pain-related services in closer proximity to the
imaging event and, therefore, would provide a more focused reflection
of recent clinical decision-making. However, it would also result in
fewer cases per ASM participant, which could create a narrower view of
the ASM participant's trends related to MRI referral and low back pain.
We seek comment on the proposed 365-day lookback period and the
alternative of a 120-day lookback period.
(b) Removing Functional Status Change for Patients With Low Back
Impairments (MIPS Q220) and Adding Functional Outcome Assessment (MIPS
Q182)
In the CY 2026 PFS final rule (90 FR 49620 through 49622), we
finalized inclusion of Functional Status Change for Patients with Low
Back Impairments (MIPS Q220) in the ASM low back pain quality measure
set because it captures functional outcomes that are directly relevant
to patients' experience of low back pain and their ability to perform
daily activities. We noted that the measure aligns with the model's
emphasis on patient-centered outcomes and longitudinal management and
complements the broader set of prevention and utilization-focused
measures included in the ASM low back pain quality measure set.
Since publication of the CY 2026 PFS final rule, the measure
steward has indicated that they no longer intend to maintain Functional
Status Change for Patients with Low Back Impairments (MIPS Q220),
including key operational components such as the survey's online
portal. Consistent with this change, we are removing this measure from
the MIPS measure inventory.
Accordingly, we are proposing at Sec. 512.725(c)(4) to remove the
Functional Status Change for Patients with Low Back Impairments (MIPS
Q220) from the ASM low back pain quality measure set and replace it
with Functional Outcome Assessment (MIPS Q182). This proposal would
address the absence of the MIPS 220 measure by replacing one measure of
functional status with another.
We believe that Functional Outcome Assessment (MIPS Q182)
represents an appropriate replacement as it meets similar goals as the
inclusion of MIPS Q220 and may be familiar to many ASM low back pain
participants. However, we note that we intend to pursue the future
adoption of a more robust patient-reported outcome performance measure
(PRO-PM) to further emphasize the importance of functional status
improvement within ASM. Such a change to the ASM low back pain quality
measure set would be proposed via future notice-and-comment rulemaking.
Functional Outcome Assessment (MIPS Q182) promotes the routine
assessment of functional status and requires clinicians to document a
care plan when functional outcome deficiencies are identified. As such,
the measure supports a more patient-centered approach to care by
encouraging ASM participants to incorporate patients' reported
experiences and functional status assessments and limitations into
clinical decision-making. The measure leverages patient-reported
outcome tools and surveys to facilitate meaningful communication
between clinicians and their patients regarding symptoms, daily
functioning, and treatment goals; as a result, identified concerns can
be addressed as part of the evaluation and management of the patient.
We believe that systematic measurement and improvement of
functional status can increase patient self-efficacy, improve overall
well-being, and potentially reduce downstream healthcare utilization
and costs. Additionally, the use of validated and standardized
assessment tools may enhance the reliability and sensitivity of
detecting functional impairments and monitoring changes over time,
particularly among older adults with low back pain.\173\
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\173\ Wong AY, Karppinen J, Samartzis D. Low back pain in older
adults: risk factors, management options and future directions.
Scoliosis and Spinal Disorders. 2017;12(1):1-23. doi: https://doi.org/10.1186/s13013-017-0121-3.
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Although Functional Outcome Assessment (MIPS Q182) does not require
the use of a specific instrument, examples of appropriate, validated
tools relevant to the ASM low back pain cohort include the Modified
Oswestry Disability Index and the Patient-Reported Outcomes Measurement
Information System (PROMIS). The use of such tools is supported by
clinical guidelines and professional organizations. For example, the
American Academy of Orthopaedic Surgeons recommends the Modified
Oswestry Disability Index as a preferred instrument for assessing
functional outcomes in spine care.174 175 These functional
status instruments may also capture information related to
[[Page 43978]]
modifiable risk factors, such as physical activity levels and social
isolation, which can inform clinical discussions and interventions
aimed at preventing the progression of low back pain and associated
comorbid conditions.
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\174\ North American Spine Society. Clinical Guidelines for
Multidisciplinary Spine Care: Diagnosis and Treatment of Low Back
Pain. North American Spine Society; 2020.
\175\ Performance Measures by Orthopaedic Subspecialty.
Aaos.org. Published 2025. Accessed April 23, 2025. https://www.aaos.org/quality/research-resources/patient-reported-outcome-measures/performance-measures-by-orthopaedic-subspecialty.
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This proposal also responds to interested parties' feedback
regarding operational concerns with Functional Status Change for
Patients with Low Back Impairments (MIPS Q220). In addition, Functional
Outcome Assessment (MIPS Q182) aligns with the Quality Payment
Program's Rehabilitative Support for Musculoskeletal Care MIPS Value
Pathway (MVP), further supporting its inclusion in the ASM. We also
note that Functional Outcome Assessment (MIPS Q182) has a MIPS CQM
collection type, the same collection type as the Functional Status
Change for Patients with Low Back Impairments (MIPS Q220).
By embedding accountability for assessing and addressing functional
status into the ASM quality measure set for ASM participants who treat
low back pain, this measure supports a comprehensive, longitudinal
approach to low back pain management, including appropriate evaluation,
treatment planning, and ongoing monitoring of patient outcomes.
We seek comment on our proposal at Sec. 512.725(c)(4) to remove
the Functional Status Change for Patients with Low Back Impairments
(MIPS Q220) from the ASM low back pain quality measure set and replace
it with Functional Outcome Assessment (MIPS Q182).
(3) Data Completeness Requirement for the Quality ASM Performance
Category
As discussed in the CY 2026 PFS final rule (90 FR 49631), we
finalized policies to establish a data completeness requirement for
applicable quality measures in the quality ASM performance category.
Under this requirement, ASM participants reporting MIPS clinical
quality measures (MIPS CQMs) or eCQMs would be required to submit data
for at least 75 percent of patients who meet the denominator criteria
for each measure, regardless of payer.
The regulatory text at Sec. 512.725(f)(3) describing the data
completeness requirement includes a non-substantive typographical error
of a misplaced possessive ``s'' on ``ASM''.
We propose at Sec. 512.725(f)(3) correct this typographical error
so that it would read: ``CMS excludes from an ASM participant's total
measure achievement points and total available measure achievement
points any measure required under paragraph (b) or (c) of this section
that meets the respective measure's data completeness requirement but
does not have a benchmark.'' We believe this correction clarifies the
regulatory text without substantively changing the policy under
existing provisions.
We seek comment on our proposal to modify Sec. 512.725(f)(3) to
correct this typographical error.
(4) Scoring and Benchmarks for Quality Measures
As discussed in the CY 2026 PFS final rule (90 FR 49634 through
49635), we finalized policies to benchmark and score ASM quality
measures. We will use measure-specific benchmarks where separate
benchmarks are calculated for each measure and collection type to
reflect meaningful performance differences among ASM participants.
Quality measure benchmarks will be derived from ASM participant data
from the current or prior ASM performance years, or another CMS-
determined period. We determined that separate benchmarks by collection
type (for example, MIPS CQM and eCQM) are more appropriate than a
single benchmark for each measure aggregated across collection types
due to established scoring variation across collection types.
Benchmarks will be decile-based percentile distributions, which enable
consistent scoring and translate measure performance values uniformly.
To score reported data against the benchmarks, ASM participants'
performance on each measure will be mapped to decile ranges, with one
to 10 achievement points assigned according to the decile in which the
measure's reported rate falls.
In the CY 2026 PFS final rule, we explained that administrative
claims-based quality measures do not require data submission (90 FR
49616) and finalized corresponding administrative claims-based quality
measure scoring policies (90 FR 49630). However, we did not specify
whether we would score such measures at the group (that is, TIN) or
individual (that is, TIN/NPI) level.
We are now proposing to specify the level at which we would
calculate administrative claims-based quality measures. Specifically,
we propose at Sec. 512.725(e)(3)(i) to score all administrative
claims-based quality measures at the individual (that is, TIN/NPI)
level to ensure that performance assessment reflects the individual ASM
participant performance regardless of eligibility to report quality
measures at the group (that is, TIN) level. Administrative claims-based
quality measures do not require ASM participants to submit data,
thereby reducing reporting burden for all ASM participants, including
those that may be from a small group practice or face resource
constraints. Scoring these measures at the individual (that is, TIN/
NPI) level preserves the model's intended focus on individual
specialist accountability.
We also propose modifications to Sec. Sec. 512.725(h)(1) and
512.725(h)(2) to clarify quality ASM performance category scoring
policies applicable to quality measures reported by an ASM participant,
compared to administrative claims-based quality measures calculated by
us. These proposals aim to align regulatory text with the nature of
quality measure collection types, distinguishing quality measures for
which ASM participants actively submit data from administrative claims-
based quality measures that we calculate and therefore do not require
data submission.
Accordingly, we propose to reorganize and revise regulatory text at
Sec. 512.725(h)(1)(i) to clarify the different requirements that
administrative claims-based quality measures and non-administrative
claims-based quality measures must meet to be scored. Specifically, we
propose to remove the phrase ``on which data is submitted'' from Sec.
512.7250(h)(1)(i), which describes how ASM participants are awarded
achievement points for quality measures that meet the specified
criteria, to conform with the proposed reorganization of this section
of regulatory text.
We also propose to describe all scoring requirements for non-
administrative claims-based quality measures at Sec.
512.725(h)(1)(i)(A). Specifically, we propose to redesignate former
regulatory text Sec. 512.725(h)(1)(i)(A) through (h)(1)(i)(C) as Sec.
512.725(h)(1)(i)(A)(1) through (h)(1)(i)(A)(3), respectively. We then
propose to revise Sec. 512.725(h)(1)(i)(A) to describe that quality
measures other than administrative claims-based quality measures must
meet the requirements described at Sec. 512.725(h)(1)(i)(A)(1) through
(h)(1)(i)(A)(3) to be scored. We also propose to redesignate regulatory
text formerly at Sec. 512.725(h)(1)(i)(D) to Sec. 512.725(h)(1)(i)(B)
and to revise text to clarify the scoring requirements for
administrative claims-based quality measures. We note that these
proposed revisions do not make substantive changes to existing scoring
requirements but would provide greater clarity to ASM participants on
the specific requirements for quality measures to be scored.
[[Page 43979]]
We also propose to clarify our provisions related to the
determination of quality measure benchmarks. Specifically, we propose
to remove Sec. 512.725(h)(2)(iii), which describes the periods we may
use to calculate administrative claims-based quality measure
benchmarks. We believe this paragraph is unnecessary in light of Sec.
512.725(h)(2)(i), which sufficiently describes the periods we may use
to calculate any quality benchmark, whether administrative claims-based
or otherwise. To conform with this proposal, we also propose to remove
cross-references to Sec. 512.725(h)(2)(iii) from Sec. Sec.
512.725(h)(1)(i)(D) and 512.725(h)(2)(i), as well as redesignate former
Sec. 512.725(h)(2)(iv) as new Sec. 512.725(h)(2)(iii). These
proposals would allow more flexibility in determining appropriate and
fair benchmarks and ensure that benchmark time periods align with the
performance periods of the administrative claims-based quality
measures.
We also propose to clarify quality measure scoring when we are
unable to determine a benchmark. Specifically, we propose at Sec.
512.725(h)(2)(iv) that we would exclude any required quality measure
for which we cannot calculate a benchmark in the determination of an
ASM participant's quality ASM performance category score. We would do
so by removing the total measure achievement points (that is, the
points calculated for the numerator of the quality ASM performance
category score) and the total available measure achievement points
(that is, the points calculated for the denominator of the quality ASM
performance category score) from the quality ASM performance category
score calculation for any quality measure that lacks a benchmark. While
we state that a quality measure must have a benchmark to be scored
under proposed Sec. 512.725(h)(1)(i), we believe that this proposal
clarifies the effect of a quality measure lacking a benchmark on the
overall quality ASM performance category score.
We seek comment on our proposal at Sec. 512.725(e)(3)(i) to score
all administrative claims-based quality measures at the TIN/NPI level.
We also seek comment on our proposed reorganization of regulatory text
at Sec. 512.725(h)(1)(i) to separately describe the scoring
requirements for non-administrative claims-based quality measures and
administrative claims-based quality measures. We seek comment on our
proposals at Sec. 512.725(h)(2) to clarify provisions related to the
determination of quality measure benchmarks. Finally, we seek comment
on our proposal at Sec. 512.725(h)(2)(iv) describing how we would
account for quality measures without benchmarks in the quality ASM
performance category score calculation.
(5) Voluntary Data Submission for the Development of Patient-Reported
Outcome-Based Performance Measures (PRO-PMs)
As discussed in the CY 2026 PFS final rule (90 FR 9612), we are
considering future adoption of one or more patient-reported outcome-
based performance measures (PRO-PMs) in ASM that would evaluate changes
in patient-reported health status, physical function, symptoms,
aggregate patient-reported health status, or other related outcomes
over time. Unlike a functional status process measure that assesses
whether a functional status assessment or other patient-reported
assessment was completed, a PRO-PM would collect information directly
from patients to assess whether the care furnished by an ASM
participant is associated with improvement in, or slowing of decline
in, ASM beneficiary-reported outcomes. We believe such measures could
better capture outcomes that matter to ASM beneficiaries and support
more patient-centered specialty care. Standardized assessment of
patient-reported health status using a validated questionnaire can be
useful for providing incremental information related to patient
functional status and prognosis. It is also an independent predictor of
hospitalization and mortality.\176\ PRO-PMs may also encourage ASM
participants to incorporate the patient voice and lived experience into
clinical decision-making, treatment planning, longitudinal monitoring,
and shared decision-making. At this time, we are considering the
development of PRO-PMs specific to each ASM targeted chronic condition.
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\176\ Heidenreich PA, Bozkurt B, Aguilar D, et al. 2022 AHA/ACC/
HFSA Guideline for the Management of Heart failure: a Report of the
American College of Cardiology/American Heart Association Joint
Committee on Clinical Practice Guidelines. Circulation.
2022;145(18). doi: https://doi.org/10.1161/cir.0000000000001063.
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We are interested in using the Patient-Reported Outcomes
Measurement Information System (PROMIS) as the basis for a PRO-PM as it
is a set of standardized, validated patient-reported outcome
instruments that can be used to assess domains such as physical
function, symptoms, pain interference, mental health, social health,
and quality of life.\177\ We believe PROMIS would allow for a
standardized measurement framework across ASM participants, ASM
targeted chronic conditions, and care settings. Unlike other patient-
reported outcome (PRO) instruments that exclusively focus on a
particular clinical population, PROMIS includes domains relevant across
chronic conditions and can be administered through flexible formats,
including short forms and computer adaptive tests. It also has
condition-specific profiles, like PROMIS+HF, that is relevant to
ASM.\178\ Finally, other Innovation Center models either use or plan to
use PROMIS, such as the Advancing Chronic Care with Effective, Scalable
Solutions (ACCESS) Model.\179\ We also note that PROMIS is already a
permitted standardized tool to satisfy the Functional Status
Assessments for Heart Failure measure (MIPS Q377) in the ASM heart
failure cohort quality measure set and the proposed Functional Outcome
Assessment measure (MIPS Q182) in the ASM low back pain cohort quality
measure set.
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\177\ ``Patient-Reported Outcomes Measurement Information System
(PROMIS).'' NIH Common Fund, National Institutes of Health, https://commonfund.nih.gov/promis.
\178\ Ahmad, Fatima S., et al. ``Validation of PROMIS+HF Profile
Instruments in Heart Failure Patients.'' ESC Heart Failure, vol. 9,
no. 5, 2022, pp. 3380-3392. PubMed Central, https://pmc.ncbi.nlm.nih.gov/articles/PMC9715763/.
\179\ ``ACCESS (Advancing Chronic Care with Effective, Scalable
Solutions) Model.'' Centers for Medicare & Medicaid Services, U.S.
Department of Health and Human Services, https://www.cms.gov/priorities/innovation/innovation-models/access.
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We recognize that some ASM participants may currently use different
patient-reported assessment instruments. To the extent scientifically
appropriate, existing crosswalks or linking methods may help inform
transitions from other instruments to PROMIS. For example, PROsetta
Stone provides methods for linking PROMIS scores with other patient-
reported outcome measures (PROMs) that assess similar concepts, which
may support comparability across instruments.\180\ This could provide
flexibility for ASM participants using other instruments while
preserving the standardized measurement framework that would be
important for PRO-PM development.
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\180\ ``PROsetta Stone.'' PROsetta Stone, https://www.prosettastone.org.
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While we are prioritizing PROMIS data collection, we are also
interested in collecting data from other PRO instruments where
appropriate to support evaluation and validation of PROM-to-PROM
crosswalks that may facilitate future PRO-PM implementation.
We believe providing an opportunity for voluntary data submission
would be an important step toward developing
[[Page 43980]]
meaningful, patient-centered outcome measures for ASM. Incentivizing
early submission of PROMIS and, potentially, other PRO data would help
us determine whether future PRO-PMs are feasible and appropriate to be
proposed for inclusion in the model through notice-and-comment
rulemaking. This voluntary data submission approach would also provide
ASM participants an opportunity to build PRO data collection
infrastructure before any future PRO-PM would be proposed as a quality
measure used in evaluating performance under ASM.
(a) Quality ASM Performance Category Scoring Incentive for Voluntary
Patient-Reported Outcome (PRO) Data
To support the development of PRO-PMs under ASM, we propose to
establish a voluntary data submission opportunity and scoring incentive
for ASM participants to report PRO data, including data collected using
PROMIS instruments and, as applicable, other CMS-specified PRO
instruments. The goal of this data submission would be to support the
development, testing, and potential future inclusion of PRO-PMs in
ASM's quality measure sets. Since ASM currently does not require ASM
participants to submit PROMIS or other PRO data for measure development
purposes, we recognize that there may be insufficient incentives for
ASM participants to voluntarily collect and submit such data. We
believe establishing an appropriate incentive for voluntary data
submission by ASM participants would support efforts to collect the
data needed to inform PRO-PM development and whether any developed PRO-
PM would be feasible for inclusion in an ASM cohort's quality measure
set during the ASM test period. We believe this proposal is consistent
with the Innovation Center's authority under section 1115A of the Act
to test innovative payment and service delivery models that improve the
quality and coordination of care, including approaches that support
development and assessment of patient-centered quality measurement and
beneficiary-reported outcomes.
Specifically, we propose at Sec. 512.725(i) to create a quality
ASM performance category scoring incentive by adding 5 points to an ASM
participant's quality ASM performance category score for an applicable
ASM performance year if the ASM participant submits beneficiary-level
PRO data that meets criteria established by CMS, provided such
additional points would not cause the ASM participant's score to exceed
the maximum quality ASM performance category score otherwise available
under the model. We refer readers to the proposed PRO data submission
criteria discussed later in this section of this proposed rule. We also
refer readers to section III.D.2.f.(4) of this proposed rule where we
propose to notify an ASM participant if they meet the data submission
requirements to receive the quality ASM performance category scoring
incentive through their annual ASM performance report.
We believe that this scoring incentive approach would recognize the
additional effort required to collect and submit PRO data and would
avoid disadvantaging ASM participants not yet prepared to voluntarily
collect and submit PRO data. The proposed 5-point scoring incentive
added to the quality ASM performance category score represents half of
the maximum quality measure achievement points for a single quality
measure. We believe this amount appropriately incentivizes voluntary
data submission by offering an increase to the quality ASM performance
category score without equaling the maximum achievement points that can
be earned through performance on quality measures. We believe such an
approach would preserve the integrity and importance of the existing
quality measure set required of each ASM participant. We further
believe that structuring the scoring incentive so that an ASM
participant's total quality ASM performance category score cannot
exceed the category's maximum score would preserve the integrity and
fairness of performance comparisons while encouraging voluntary data
submission.
Eligibility for the scoring incentive for voluntary data submission
would be limited to the ASM cohorts for the ASM performance years in
which we are actively developing a PRO-PM. For example, if we establish
a voluntary heart failure PRO data submission opportunity in the 2027
ASM performance year, only ASM heart failure participants would be
eligible to receive the 5-point scoring incentive for the 2027 ASM
performance year and ASM low back pain participants would not be
eligible for the scoring incentive for that year.
We clarify that we are not proposing at this time to (1) adopt a
new PRO-PM in the quality measure for either ASM cohort, (2) evaluate
ASM participants on PROMIS performance, or (3) require ASM participants
to collect or submit PROMIS or other PRO data. Rather, this proposal is
intended to support voluntary data collection to support our evaluation
of the feasibility, reliability, validity, and appropriateness of one
or more future PROMIS-based or other PRO-based PRO-PMs before any such
measure would be proposed for inclusion in an ASM cohort's quality
measure set, which we would propose through future notice-and-comment
rulemaking.
We considered an alternative approach under which ASM participants
could receive a higher number of additional points as this could
provide greater incentive to voluntarily submit sufficient data for
measure development purposes. We are not proposing a higher number of
additional points because it could reduce the distinction between the
measure achievement points available for existing performance-based
quality measures and the voluntary submission of PRO data for measure
development purposes. Conversely, we are not proposing a lower number
of additional points to the quality ASM performance category score
because we believe this may not provide a sufficient incentive to
encourage meaningful participation in voluntary data submission.
We also considered an alternative approach to award 10 points, the
maximum quality measure achievement score, for the existing PROM-
related process measure for ASM participants who successfully: (1)
submit a required PROM-related process measure included in the quality
ASM performance category measure set and (2) voluntarily submit the
CMS-specified PRO data for an applicable ASM performance year. For
example, under this alternative, an ASM heart failure participant who
successfully reports the Functional Status Assessments for Heart
Failure measure (MIPS Q377) and voluntarily submits the CMS-specified
PRO data would automatically receive 10 measure achievement points for
the Functional Status Assessments for Heart Failure measure regardless
of actual performance as assessed against the applicable benchmark. For
the same reasons noted above regarding our intent to draw distinction
between performance-based quality measurement and data submission, we
are not proposing this alternative. Additionally, we believe this
approach would not provide meaningful incremental incentives for some
ASM participants because those ASM participants who successfully
collect and voluntarily submit the required PRO data may already be
likely to perform well on the associated PROM-related process measure.
We also considered establishing a tiered incentive structure under
which the number of additional points awarded to the quality ASM
[[Page 43981]]
performance category score would be scaled based on the quantity,
completeness, representativeness, or other related characteristics of
the voluntarily submitted PRO data. For example, ASM participants that
submit data for a larger number of ASM beneficiaries, achieve higher
response or follow-up completion rates, or submit additional data
elements that could support measure development and testing would
receive a larger scoring incentive than ASM participants that meet the
minimum data submission requirements. We are not proposing this
alternative because our goal is that all voluntarily submitted data
intended for measure development should meet the minimum requirements
necessary to support reliable and scientifically sound measure
development and testing. We are concerned that a tiered approach could
create an incentive that prioritizes submission volume over data
quality or could imply that data meeting the minimum submission
requirements is less valuable for measure development purposes.
Therefore, we believe a single incentive tied to successful completion
of all required data submission requirements is a more appropriate
approach.
We also considered whether to encourage voluntary PRO data
submission through non-scoring mechanisms, such as providing ASM
participants with enhanced feedback reports, analytic tools,
educational resources, or other related support. We recognize that such
resources could be of operational value to ASM participants while
supporting our development of PRO-based quality measures. However, we
are not proposing a non-scoring-based incentive as we do not believe
this would, by itself, provide sufficient incentive to encourage broad
voluntary participation in PRO data collection and submission
activities. While we may consider providing operational support or
resources in the future, we believe a direct scoring incentive is more
likely to generate the quantity and quality of data necessary to
support timely PRO-PM development and testing.
We further considered another alternative whereby the maximum
quality ASM performance category score would not be capped, allowing an
ASM participant's quality ASM performance category score to exceed the
maximum points otherwise available for the quality ASM performance
category for the limited purpose of encouraging voluntary PRO data
submission. For example, under this alternative, an ASM participant who
earns a quality ASM performance category score of 46 points and
voluntarily submits PRO data for the applicable performance year would
receive 51 points out of 50 points available for the final quality ASM
performance category. We are not proposing this alternative because it
would be inconsistent with the existing quality ASM performance
category scoring methodology. The quality and cost ASM performance
categories were intentionally designed to have equal weight in the
calculation of a final score. Allowing the quality ASM performance
category score to exceed its current maximum could disrupt that balance
and place disproportionate emphasis on quality scoring relative to cost
performance. We believe maintaining the current maximum quality ASM
performance category score preserves comparability across ASM
participants and the integrity of the quality scoring framework.
Finally, we considered another alternative incentive whereby we
would add additional points to the final score of an ASM participant
who successfully reports the CMS-specified PRO data for the applicable
ASM performance year. Under this approach, the additional points would
be added to the final score after calculation of any applicable ASM
performance category scores to directly increase the ASM participant's
final score. We are not proposing this alternative because it would
disconnect the incentive from the quality ASM performance category,
where the benefits of collecting and reporting PRO data are most
appropriately reflected. In addition, applying additional points
directly to an ASM participant's final score could have broader effects
on overall model performance and payment adjustment outcomes than
intended and would be less consistent with the targeted objective of
encouraging voluntary data submission to support future PRO-PM
development.
We seek comment on our proposal at Sec. 512.725(i) to provide 5
additional points to the quality ASM performance category score of an
ASM participant who voluntarily submits CMS-specified PRO data and
meets all data submission requirements for an applicable ASM
performance year. We seek comment on all alternatives that we
considered. We also invite comment on whether the proposal and
alternatives would support voluntary data submission to achieve the
goal of developing PRO-PMs applicable to ASM.
(b) Requirements for Successful Voluntary PRO Data Submission
Development of a valid, reliable, and feasible PRO-PM requires
sufficient beneficiary-level PRO data prior to implementation and
scoring of the measure. In particular, data is needed to: (1) analyze
measure reliability and validity, (2) evaluate feasibility of data
collection and submission, (3) measure response rates and missingness,
(4) examine potential nonresponse bias, (5) identify appropriate risk
adjustment variables, and (6) determine whether a measure can
meaningfully and fairly distinguish performance across ASM participants
within a given ASM cohort. For potential PRO-PMs, development may
require that data be collected over an extended episode or longitudinal
assessment period, including baseline and follow-up PRO assessments.
Accordingly, early collection and submission of PRO data by ASM
participants is important to support timely development and testing of
PRO-PMs such that we could propose measures for future inclusion in
ASM's respective quality measure sets through future notice-and-comment
rulemaking.
To support PRO-PM development, we would specify the applicable PRO
instrument(s), the required data that an ASM participant would need to
voluntarily submit, and applicable data collection periods.
Accordingly, we propose to define the data submission requirements that
an ASM participant would need to meet to ensure we receive sufficient
and reliable data to develop and test PRO-PMs applicable to ASM.
Specifically, at Sec. 512.725(i)(1), we propose to define all data
submission requirements an ASM participant would need to meet to
receive the proposed scoring incentive in the quality ASM performance
category for an applicable ASM performance year.
First, at Sec. 512.725(i)(1)(i), we propose that an ASM
participant would need to submit CMS-specified baseline assessment data
for at least 20 ASM beneficiaries during the first data collection
period specified by us. By baseline data, we mean the initial CMS-
specified PRO assessment data collected for an ASM beneficiary during
the applicable data collection period that occurs before the collection
of any corresponding follow-up assessment data for the beneficiary.
After baseline data is collected, an ASM participant would submit CMS-
specified follow-up assessment data for at least 20 ASM beneficiaries
for whom they previously submitted a baseline assessment during the
preceding data collection period specified by us.
Our goal in establishing minimum baseline and follow-up assessment
requirements is to ensure we receive sufficient longitudinal PRO data
to support development and testing of
[[Page 43982]]
future PRO-PMs. We believe that collecting baseline assessment data
initially then collecting corresponding follow-up assessment data
during a subsequent data collection period would allow us to evaluate
changes in beneficiary-reported outcomes over time while reducing
operational burden during the initial year of data collection. The
specific amount of time between a baseline and follow-up assessment
would depend on the selected PRO instrument(s) and ASM targeted chronic
condition, however, we anticipate that a collection period of at least
6 months between a beneficiary's baseline and follow-up assessments may
be necessary to allow sufficient time to observe meaningful changes in
patient-reported outcomes. We would provide specifications regarding
the timing of baseline and follow-up assessments and specific data
collection periods through sub-regulatory technical guidance.
Second, at Sec. 512.725(i)(1)(ii), we propose that an ASM
participant would need to report all required data elements for the
applicable PRO instrument as specified by us for the applicable data
collection period. We anticipate that required data elements would
include at least: (i) the PRO instrument name and version, (ii) ASM
participant identification information, (iii) ASM beneficiary
identification information and linkage information, (iv) assessment
date, (v) baseline or follow-up assessment indicator, (vi) mode of
administration, (vii) item-level responses, (viii) nonresponse and
missingness indicators, (ix) raw and standardized scores, (x) score
calculation method, and (xi) other data elements needed to support
measure testing and risk adjustment model testing. If testing would
require use of a crosswalk, such as PROsetta, we anticipate that we
would also require reporting of data elements specific to the
crosswalk. The required data elements and format in which an ASM
participant would need to submit the data would be specific to the
selected PRO instrument(s) and would be specified by us in sub-
regulatory technical guidance.
Third, at Sec. 512.725(i)(1)(iii), we propose that an ASM
participant would need to submit data on a minimum set of risk
variables for each ASM beneficiary from whom they collect PRO data.
Risk adjustment is necessary to ensure that performance results under a
PRO-PM reflect quality of care rather than patient complexity to avoid
penalizing clinicians who may serve higher-risk beneficiary
populations. Reporting a minimum set of risk variables for each ASM
beneficiary receiving a PRO assessment would allow us to develop a
scientifically acceptable, robust, and reliable risk model for any
developed PRO-PM. The reported risk variable data would be used to
conduct assessments of association between risk variables and the
measured PRO to inform risk variable selection and ensure the risk
model captures the most clinically and statistically relevant risk
variables. Example risk variables could include but are not limited to
age, race, ethnicity, socioeconomic status, clinical comorbidities,
baseline clinical severity, physiological measures (for example, body
mass index or blood pressure), pain history, surgical history, disease
classification, medication usage, behavioral factors, functional and
disability status, and other condition-specific characteristics. We
believe that the risk variables would be different for each ASM
targeted chronic condition for which we would develop a PRO-PM. We
intend to provide the minimum risk variables applicable for the
selected PRO instrument(s), including each risk variable's technical
specifications, through sub-regulatory technical guidance.
Fourth, at Sec. 512.725(i)(1)(iv), we propose that an ASM
participant must submit the PRO data for any applicable data collection
period by the generally applicable data submission deadline for the
applicable ASM performance year, which is March 31st, or later in the
calendar year, as specified by as, following the close of the
applicable ASM performance year. We recognize that--depending on the
applicable PRO instrument, measure concept, and assessment interval--
baseline and follow-up assessments for an ASM beneficiary may need to
occur across ASM performance years to allow a sufficient interval
between the initial and follow-up PRO assessments. In such cases, we
would specify through technical guidance how ASM participants would
submit baseline and follow-up data for data collection periods that
span ASM performance years and how this would impact the availability
of the scoring incentive for a given ASM performance year. We believe
that aligning the voluntary PRO data submission deadline with the
generally applicable data submission deadline for ASM performance
category data would streamline and simplify the data submission and
would provide us adequate time to confirm if the submitted PRO data
meets the requirements to receive the proposed scoring incentive for
the quality ASM performance category. We anticipate that the PRO data
submission would occur through one or more mechanisms, such as a CMS-
specified file format, registry submission, qualified clinical data
registry or other intermediary, Health Level Seven Fast Healthcare
Interoperability Resources (HL7 FHIR)-based submission, or another
electronic submission mechanism specified by CMS. We would provide
additional operational details through technical guidance, including
applicable submission deadlines, data formats, validation processes,
and any minimum data completeness or case minimum requirements. We also
seek to preserve flexibility to align submission requirements with
existing ASM participant workflows and health information technology
capabilities to the extent feasible.
We recognize that in some instances ASM participants may need to
correct their voluntary data submission. Accordingly, we propose at
Sec. 512.725(i)(2) that ASM participants could correct and resubmit
any PRO data corresponding with voluntary data submission by the
proposed data submission deadline of March 31st in accordance with the
generally applicable data submission deadline for the applicable
performance year, or a later date specified by CMS. Because the
proposed scoring incentive would affect the quality ASM performance
category score, we propose to only accept timely submissions,
corrections, or resubmissions and reject those received after the data
submission deadline. We believe this approach is necessary to preserve
the integrity and finality of the scoring process and payment
adjustment methodology and to align voluntary PRO data submission with
other ASM performance category data submission requirements. We would
consider providing submission error reports or other technical feedback
identifying errors, missing data elements, beneficiary linkage issues,
data completeness concerns, or other issues before the applicable data
submission deadline to support ASM participants.
Relatedly, we propose at Sec. 512.725(i)(3) that an ASM
participant may seek review under ASM's timely error notice process for
technical errors related to CMS' determination of whether the ASM
participant met the voluntary PRO data submission requirements or
correctly received the quality ASM performance category scoring
incentive for the applicable ASM performance year as provided in the
ASM participant's annual ASM performance report. To align with ASM's
timely error notice requirements
[[Page 43983]]
and process described at Sec. 512.755, the ASM participant may submit
a written timely error notice if they believe an error occurred in
calculations due to data quality, misapplication of methodology, or
other related issues that would relate to whether the ASM participant
qualified for the proposed quality ASM performance category scoring
incentive for the applicable ASM performance year. Examples of such
errors include beneficiary linkage errors, failure to account for data
timely submitted by the ASM participant, or other technical errors in
our evaluation of the voluntary PRO data submission against data
requirements.
We considered requiring that an ASM participant submit PRO data on
more than 20 ASM beneficiaries or fewer than 20 ASM beneficiaries
during each CMS-specified data collection period specified. We also
considered requiring that an ASM participant submit PRO data on a
minimum percentage of their ASM beneficiaries (for example, 25 to 100
percent) during the applicable data collection period. However, we
believe an adequate number of ASM participants collecting and reporting
PRO data on a minimum of 20 ASM beneficiaries each would provide an
adequate sample size for PRO-PM development and align with the 20-case
minimum for quality measures under ASM.
We also considered requiring an ASM participant to submit PRO data
more frequently during an ASM performance year (for example, quarterly
or biannually). Multiple data submission time points, such as quarterly
or on a rolling basis rather than a single annual submission, may offer
several advantages. It would enable the selected submission mechanism
(for example, data submission portal) to provide ASM participants who
voluntarily submit data with timely, actionable feedback on the quality
of the data submitted, flagging inaccuracies and offering opportunities
for correction and resubmission before the applicable data collection
period and ASM performance year ends. Iterative data collection and
feedback could support a continuous improvement process, helping ASM
participants identify and resolve data quality issues early. This would
be particularly helpful for avoiding the scenario where a provider
submits data once annually, only for that data to be found unusable at
the point of determining eligibility for the quality ASM performance
category scoring incentive. More frequent data submissions would likely
improve the quality of data for measure development and testing. While
more frequent data submission would offer several advantages, we
believe that aligning the voluntary data submission deadline with the
overall data submission deadline for ASM performance category data
would be administratively simpler for ASM participants.
We also considered requiring ASM participants to submit both
baseline and follow-up assessment data for the same ASM beneficiaries
during a single ASM performance year. Under this alternative, an ASM
participant would be required to collect and submit both the initial
and follow-up PRO assessments within the same ASM performance year to
receive the voluntary PRO data submission scoring incentive. We
recognize that this approach could accelerate collection of matched
assessment data and potentially expedite certain measure development
and testing activities. However, we are not proposing this alternative
because the appropriate interval between baseline and follow-up
assessments may vary depending on the selected PRO instrument, the
targeted chronic condition, and the future PRO-PM concept under
development. We are also concerned that requiring both assessments
within a single ASM performance year could limit flexibility, increase
operational burden on ASM participants, and reduce the amount of time
available to observe meaningful changes in ASM beneficiary-reported
outcomes.
For any data collection period following a baseline data collection
period, we considered that an ASM participant would need to submit
baseline assessment data for additional ASM beneficiaries that were
either newly eligible for a selected instrument or had not previously
been assessed using a selected instrument. This new baseline data would
be in addition to the follow-up assessment data that we propose to
require. We believe that this structure could increase the amount of
data available to develop a PRO-PM over time. However, we would require
additional information to determine the minimum number of new baseline
assessments that would be appropriate to require the ASM participant to
collect during a subsequent data collection period.
We also considered whether to require additional criteria for
successful voluntary PRO data submission, including submission of a
denominator file of eligible ASM beneficiaries; use of a CMS-specified
sampling methodology, such as consecutive, all-eligible, all-payer, or
random sampling; minimum response or completion rates; minimum baseline
and follow-up completion thresholds; and documentation of exclusions,
where applicable, for identified ASM beneficiaries. We are not
proposing these additional requirements at this time because the
appropriate denominator, sampling approach, response-rate threshold,
completion threshold, and exclusion documentation requirements may vary
based on the selected PRO instrument, ASM targeted chronic condition,
data submission mechanism, and measure concept under consideration for
development.
We seek comment on the proposed requirements for voluntary PRO data
submission at Sec. 512.725(i)(1) that an ASM participant would need to
meet to receive the proposed quality ASM performance category scoring
incentive. We also seek comment on all alternatives considered and
other data submission requirements we should consider to support PRO-PM
development under ASM. Additionally, we seek comment on the appropriate
timing of data submission and the scope of data elements that should be
required for successful voluntary data submission, particularly data
elements necessary to evaluate a PRO-PM's feasibility, reliability, and
validity. We also invite comment on the specific risk variables
applicable for each ASM targeted chronic condition that we should
require ASM participants to report. We are particularly interested in
comments on the earliest feasible timeframe for ASM participants to
begin collecting and submitting PROMIS or other CMS-specified PRO data,
the operational challenges ASM participants may face, and the types of
technical assistance or guidance that would facilitate voluntary data
submission. Finally, we seek comment on data submission mechanisms that
would simplify the voluntary reporting of PRO data to support PRO-PM
development under ASM.
e. Promoting Interoperability ASM Performance Category
(1) Background
As discussed in the CY 2026 PFS final rule (90 FR 49658 through
49661), we believe the Promoting Interoperability ASM performance
category measures finalized under Sec. 512.740 support the overall
goals of ASM to enhance the quality of care, reduce costs by
encouraging upstream chronic condition management, empower patients to
engage in their care, and promote collaboration between specialists and
primary care. ASM's Promoting Interoperability objectives and measures
align with the Promoting
[[Page 43984]]
Interoperability goals, objectives, and measures used in other
programs, including MIPS.
We finalized at Sec. 512.740(b)(2) that an ASM participant must
report on MIPS Promoting Interoperability objectives and measures, as
specified in technical documents. Specifically, under Sec. Sec.
512.740(b)(2)(i) through (iv), we finalized inclusion of the following
objectives under the Promoting Interoperability ASM performance
category:
Electronic Prescribing;
Health Information Exchange (HIE);
Provider to Patient Exchange; and
Public Health and Clinical Data Exchange (90 FR 49658).
We aim to align ASM and MIPS Promoting Interoperability
requirements where possible to promote consistency across programs and
reduce burden and operational complexity for ASM participants who may
already be familiar with MIPS Promoting Interoperability measures and
attestations.
In support of alignment with MIPS, we propose certain updates in
ASM, to include proposals that align with those being issued through
this proposed rule for the MIPS Promoting Interoperability performance
category, as well as proposals that align with policies previously
finalized for inclusion in MIPS that we did not yet adopt for ASM. We
refer readers to section IV.A.4.f.(4) of this proposed rule for further
discussion on MIPS Promoting Interoperability proposals.
Specifically, we propose to:
Revise the HIE objective at Sec. 512.740(b)(2)(ii) to
reorganize its structure and add an optional measure, Electronic Prior
Authorization (Measure ID # PI_HIE_7), for the 2027 ASM performance
year at proposed new Sec. 512.740(b)(2)(ii)(B);
Starting in the 2028 ASM performance year, require the
Electronic Prior Authorization measure and require the new Electronic
Prior Authorization for Prescription Drugs measure (Measure ID #
PI_HIE_8) at proposed new Sec. 512.740(b)(2)(ii)(C);
Adopt a measure exclusion policy for ASM for measures
within the Public Health and Clinical Data Exchange objective at
proposed Sec. 512.740(b)(2)(iv), consistent with a longstanding MIPS
policy;
Make technical modifications to the language describing
measure-level exclusions for measures that include an option to claim
an exclusion at Sec. 512.740(b)(3)(i)(C);
Remove the requirement to report through attestation the
security risk analysis measure by striking Sec. 512.740(b)(3)(ii);
Remove Office of the National Coordinator for Health
Information Technology (ONC) direct review required attestations by
striking Sec. 512.740(b)(4)(i);
Retain the requirement to avoid knowingly and willfully
taking actions to limit or restrict interoperability of CEHRT but
redesignate it from current Sec. 512.740(b)(4)(ii) to Sec.
512.740(b)(4)(i);
Redesignate current Sec. 512.740(c)(2) describing the
Promoting Interoperability ASM performance category scoring policy as
Sec. 512.740(c)(3) without changing the regulatory text; and
Adopt a measure suppression policy at new Sec.
512.740(c)(2) that aligns with the policy we adopted in the CY 2026 PFS
final rule for MIPS.
Table B-D2 summarizes existing finalized requirements and new
proposals in this proposed rule for the objectives and measures in the
Promoting Interoperability ASM performance category for the 2027 ASM
performance year. We discuss new proposals in the remainder of this
section of this proposed rule.
[GRAPHIC] [TIFF OMITTED] TP16JY26.051
[[Page 43985]]
(2) Proposed Update to CEHRT Definition
We refer readers to section IV.A.4.f.(4) of this proposed rule for
a discussion of proposed updates to the definition of CEHRT under MIPS.
Under Sec. 512.705, we define CEHRT for the purposes of ASM as
technology that meets the requirements set forth in MIPS regulations at
Sec. 414.1305. We are not proposing to depart from this approach.
Therefore, any updates finalized to the definition of CEHRT under MIPS
would be incorporated for purposes of ASM under the existing definition
at Sec. 512.705. We refer readers to Table C-G1 of this proposed rule
for a summary of changes.
(3) Electronic Prior Authorization Measures in the Health Information
Exchange Objective
(a) Overview
In the ``Medicare and Medicaid Programs; Patient Protection and
Affordable Care Act; Advancing Interoperability and Improving Prior
Authorization Processes for Medicare Advantage Organizations, Medicaid
Managed Care Plans, State Medicaid Agencies, Children's Health
Insurance Program (CHIP) Agencies and CHIP Managed Care Entities,
Issuers of Qualified Health Plans on the Federally-Facilitated
Exchanges, Merit-based Incentive Payment System (MIPS) Eligible
Clinicians, and Eligible Hospitals and Critical Access Hospitals in the
Medicare Promoting Interoperability Program'' final rule (89 FR 8758)
(hereinafter referred to as the ``2024 CMS Interoperability and Prior
Authorization final rule''), we finalized requirements for Medicare
Advantage organizations, Medicaid managed care plans, State Medicaid
agencies, CHIP agencies, CHIP managed care entities, and issuers of
qualified health plans on the Federally-facilitated Exchanges
(collectively, ``impacted payers'') to improve the electronic exchange
of health care information and streamline prior authorization for
medical items and services. Impacted payers must implement and maintain
prior authorization application programming interface (API) technology
to communicate information related to prior authorization requests (89
FR 8763). As we explained in the 2024 CMS Interoperability and Prior
Authorization final rule, the efficiencies associated with payer
implementation of these APIs will be more fully realized when
requesting providers also use API-enabled processes to submit prior
authorization requests.
Accordingly, we finalized the addition of an Electronic Prior
Authorization measure as a required measure for MIPS eligible
clinicians under the MIPS Promoting Interoperability performance
category HIE objective (89 FR 8910 through 8927).
(b) 2027 ASM Performance Year: Electronic Prior Authorization Measure
We believe adopting the Electronic Prior Authorization measure
within ASM would support broader Departmental efforts to advance
interoperability, modernize prior authorization processes by
encouraging ASM participants to develop capabilities that advance the
interoperable exchange of data related to prior authorization requests,
and support alignment with MIPS. This measure describes requesting a
prior authorization electronically using CEHRT to send a request
through a payer's Prior Authorization API for at least one medical item
or service (excluding prescription drugs) ordered within the applicable
performance year.
We now propose to include the Electronic Prior Authorization
measure (Measure ID # PI_HIE_7) in the Promoting Interoperability ASM
performance category under the HIE objective, consistent with MIPS,
starting in the 2027 ASM performance year. For the 2027 ASM performance
year, we propose that the Electronic Prior Authorization measure would
be available as an optional, unscored ASM Promoting Interoperability
measure, without any scoring penalty for non-reporting. We propose to
codify this measure for ASM at Sec. 512.740(b)(2)(ii)(B).
We propose to rely on the measure specifications used in MIPS for
the Electronic Prior Authorization measure and refer readers to section
IV.A.4.f.(4) of this proposed rule for a discussion of the technical
specifications for the Electronic Prior Authorization measure under
MIPS, including proposed modifications to the measure specifications,
which we propose to adopt in ASM.
To report the Electronic Prior Authorization measure, an ASM
participant would submit a ``yes'' response attesting they
satisfactorily met the requirements of the measure. We do not propose
to adopt any exclusions for this measure for the 2027 ASM performance
year, since the measure would be optional and attesting ``no'' or not
attesting at all would not result in a scoring penalty.
Under our proposal for ASM, the Electronic Prior Authorization
measure would be included under the HIE objective, consistent with
MIPS. Under the current ASM HIE objective, an ASM participant satisfies
the objective by reporting one of three available reporting options:
Support Electronic Referral Loops by Sending Health
Information (Measure ID # PI_HIE_1) and Support Electronic Referral
Loops by Receiving and Reconciling Health Information (Measure ID #
PI_HIE_4).
Health Information Exchange (HIE) Bi-Directional Exchange
(Measure ID # PI_HIE_5).
Enabling Exchange Under the Trusted Exchange Framework and
Common Agreement (TEFCA) (Measure ID # PI_HIE_6).
We are not proposing to change that an ASM participant must satisfy
one of these three reporting options to fulfill the requirements for
the HIE objective. Rather, our proposal makes the Electronic Prior
Authorization measure available as an optional, voluntary measure that
could be reported in addition to one of the required HIE reporting
options for the 2027 ASM performance year. While no points would be
awarded to ASM participants that report this measure through submission
of a ``yes'' attestation, we believe including the Electronic Prior
Authorization as an optional measure could encourage ASM participants
to develop workflows and infrastructure to support reporting the
measure once it is required beginning with the 2028 ASM performance
year.
We emphasize that, under our proposal, ASM participants who elect
not to report for the Electronic Prior Authorization measure in the
2027 ASM performance year would not be penalized.
We considered, but do not propose, offering 5 bonus points to an
ASM participant's Promoting Interoperability ASM performance category
score for the 2027 ASM performance year if an ASM participant
voluntarily attests ``yes'' to the Electronic Prior Authorization
measure as an alternative policy to our proposal to treat this optional
measure as unscored for the 2027 ASM performance year. We considered
this approach because temporary bonus points during an optional
performance year could encourage ASM participants to begin establishing
and operationalizing the capabilities needed to use a Prior
Authorization API with CEHRT before the measure would be required
beginning with the 2028 ASM performance year. We further recognize that
MIPS proposes to offer bonus points for this measure. However, we do
not propose to offer bonus points for the
[[Page 43986]]
Electronic Prior Authorization measure within the Promoting
Interoperability ASM performance category because we intend to maintain
a more simplified and streamlined scoring framework that does not
incorporate the full complexity of MIPS bonus point structures. MIPS
offers bonus points for certain optional measures under the Public
Health and Clinical Data Exchange objective, however ASM does not offer
bonus points for these measures. Our proposal to not offer bonus points
for the Electronic Prior Authorization measure is consistent with our
approach for optional measures within the Public Health and Clinical
Data Exchange objective. We believe that including bonus points in the
Promoting Interoperability ASM performance category would add
administrative and scoring complexities we do not intend to introduce.
We seek comment on the proposal at Sec. 512.740(b)(2)(ii)(B) to
include the Electronic Prior Authorization measure as an optional,
unscored measure in the Promoting Interoperability ASM performance
category for the 2027 ASM performance year. We also seek comment on the
alternative we considered where we would offer bonus points to ASM
participants who attest ``yes'' to the Electronic Prior Authorization
measure for the 2027 ASM performance year. Specifically, we seek
comment on whether offering bonus points would encourage early adoption
among ASM participants.
(c) 2028 ASM Performance Year: Electronic Prior Authorization Measure
Beginning with the 2028 ASM performance year, we propose that an
ASM participant would be required to report the Electronic Prior
Authorization measure through submission of a ``yes'' attestation or,
alternatively, claim an applicable exclusion, to satisfy the measure
requirements. In such cases, the Electronic Prior Authorization measure
would not affect the total score for the Promoting Interoperability ASM
performance category. However, if an ASM participant submits a ``no''
response, fails to submit any attestation, or does not claim an
applicable exclusion for the Electronic Prior Authorization measure,
the ASM participant would receive a score of zero for the Promoting
Interoperability ASM performance category. This scoring approach is
consistent with the approach taken for MIPS eligible clinicians under
proposed and existing policies.
Also starting in the 2028 ASM performance year, we propose to
recognize exclusions to this measure and would adopt the same exclusion
criteria as MIPS adopted in 2024 CMS Interoperability and Prior
Authorization final rule (89 FR 8909 through 8927), which are discussed
in this proposed rule without proposed modifications.
We believe requiring this measure beginning with the 2028 ASM
performance year rather than in the 2027 ASM performance year would
provide ASM participants time and flexibility to prepare to
successfully report the measure.
We propose to include this requirement at Sec.
512.740(b)(2)(ii)(C)(1). We seek public comment on our proposal to
require the Electronic Prior Authorization measure beginning with the
2028 ASM performance year.
(d) 2028 ASM Performance Year: Electronic Prior Authorization for
Prescription Drugs Measure
The proposed rule ``Medicare and Medicaid Programs; Patient
Protection and Affordable Care Act; Interoperability Standards and
Prior Authorization for Drugs for Medicare Advantage Organizations,
Medicaid Managed Care Plans, State Medicaid Agencies, Children's Health
Insurance Program (CHIP) Agencies and CHIP Managed Care Entities, and
Issuers of Qualified Health Plans on the Federally-Facilitated
Exchanges'' (hereinafter referred to as the ``2026 CMS Interoperability
Standards and Prior Authorization for Drugs proposed rule'') introduced
proposals that would require impacted payers to support various
exchange standards in support of prior authorization for prescription
drugs (91 FR 19890). Specifically, beginning on October 1, 2027,
impacted payers would be required to support electronic prior
authorization for all prescription drugs that require prior
authorization.
As more payers support standardized electronic prior authorization
capabilities, we believe measuring the use of prior authorization for
prescription medications would be a valuable addition to our assessment
of meaningful use of CEHRT under the Promoting Interoperability ASM
performance category. Standards-based electronic prior authorization
may improve timeliness and transparency of medication access by
facilitating documents-gathering and tracking of prior authorization
status within clinician EHR workflows to support care coordination and
close the prescriber-to-dispenser loop.
Accordingly, beginning with the 2028 ASM performance year, we
propose at Sec. 512.740(b)(2)(ii)(C)(2) to adopt the Electronic Prior
Authorization for Prescription Drugs measure (Measure ID # PI_HIE_8) as
a required measure under the Promoting Interoperability ASM performance
category. This measure would focus on prescription drugs covered under
a pharmacy benefit and dispensed at pharmacies. We propose to include
this measure under the HIE objective, consistent with our proposal to
include the Electronic Prior Authorization measure under this
objective. We propose to include the availability of exclusions for the
Electronic Prior Authorization for Prescription Drugs measure,
consistent with those recognized under MIPS, starting in the 2028 ASM
performance period. We propose to adopt the same measure specification
and exclusion criteria for the Electronic Prior Authorization for
Prescription Drugs measure that are being proposed under MIPS for the
MIPS Promoting Interoperability performance category. We refer readers
to section IV.A.4.f.(4) of this proposed rule for discussion on measure
specifications and exclusions.
To successfully report this measure, an ASM participant would be
required to submit a ``yes'' response attesting that they have
requested electronic prior authorization using CEHRT for at least one
prescription drug during the performance period, or alternatively,
claim an applicable exclusion. Under our proposal, this measure would
not contribute to an ASM participant's Promoting Interoperability ASM
performance category score; however, if an ASM participant submits a
``no'' response, fails to submit any attestation, or does not claim an
applicable exclusion for the Electronic Prior Authorization for
Prescription Drugs measure, the ASM participant would receive a score
of zero for the Promoting Interoperability ASM performance category
starting in the 2028 ASM performance year.
We emphasize that, under our proposal to include the prior
authorization measures under the HIE objective for ASM, an ASM
participant would continue to be required to report one of the three
existing HIE reporting options at current Sec. 512.740(b)(2)(ii).
We also underscore that we are not proposing to require the Prior
Authorization measure or the Prior Authorization for Prescription Drugs
measure until the 2028 ASM performance year.
As stated, we aim to align proposals for ASM, as appropriate, with
the direction of MIPS policy for the Promoting Interoperability
performance category. This includes alignment for the Electronic Prior
Authorization measures with MIPS and with broader
[[Page 43987]]
Departmental goals of improving interoperability and modernizing prior
authorization processes. In the 2024 CMS Interoperability and Prior
Authorization final rule, we explained that electronic prior
authorization policies are intended to encourage provider adoption of
electronic prior authorization processes and improve the exchange of
information needed to support more efficient prior authorization
workflows (89 FR 8910 through 8927). Although that final rule finalized
the Electronic Prior Authorization measure only for medical items and
services, excluding drugs, we believe those same policy goals support
adoption of an Electronic Prior Authorization for Prescription Drugs
measure under ASM beginning with the 2028 ASM performance year. We
believe requiring both electronic prior authorization measures
beginning in the 2028 ASM performance year would promote more
consistent electronic prior authorization capabilities and workflows
across ASM participants' operations and would support broader movement
toward more efficient exchange of prior authorization information.
We seek comment on all aspects of these proposals.
(4) Exclusions to the Public Health and Clinical Data Exchange
Objective in the Promoting Interoperability ASM Performance Category
In the CY 2026 PFS final rule, we finalized that an ASM participant
must submit a ``yes'' attestation for the two required measures in the
Public Health and Clinical Data Exchange objective (the Immunization
Registry Reporting and Electronic Case Reporting measures) to earn 25
points for the objective (90 FR 49658 through 49662). We noted the
potential availability of exclusions for the Immunization Registry
Reporting and Electronic Case Reporting measures in tables published in
the preamble to the proposed rule (Table 61; 90 FR 32745) and in the
preamble to the final rule (Table B-D6; 90 FR 49659). However, we did
not explicitly propose an exclusion policy in the narrative preamble
text or memorialize that policy in the regulatory text itself. As a
result, the current regulation at Sec. 512.740(b)(2)(iv) reads as
though an ASM participant must report both measures to satisfy the
objective, without the availability of exclusions for either measure.
We propose to clarify that exclusions are available to ASM
participants for the Immunization Reporting Registry and Electronic
Case Reporting measures by amending our regulation at Sec.
512.740(b)(2)(iv). Under our proposal, an ASM participant would receive
full credit for the Public Health and Clinical Data Exchange objective
by reporting both Public Health and Clinical Data Exchange measures
(Immunization Registry Reporting and Electronic Case Reporting),
reporting one measure and claiming one exclusion, or claiming two
exclusions. We believe this proposal would simplify ASM participant
reporting requirements by aligning exclusions available in MIPS and
redistributing points for excluded measures in accordance with MIPS
redistribution policies.
MIPS specifies certain exclusion criteria that apply to each of the
Immunization Registry Reporting and Electronic Case Reporting measures.
We propose to adopt the same exclusion criteria as specified in MIPS
sub-regulatory guidance for ASM, consistent with our aim to drive
alignment where possible.
We seek comment on this proposal at Sec. 512.740(b)(2)(iv),
including the proposal to use the same exclusion criteria that MIPS
uses for the Immunization Registry Reporting and Electronic Case
Reporting measures.
(5) Security Risk Analysis Measure
The Health Insurance Portability and Accountability Act of 1996
(HIPAA), as implemented through the HIPAA Security Rule (45 CFR part
160 and subparts A and C of part 164), includes administrative
safeguards required of covered entities and business associates,
including a risk analysis component and a risk management component.
The Security Risk Analysis measure was adopted to require that MIPS
eligible clinicians attest to having conducted a security risk analysis
and security risk management activities as required by the HIPAA
Security Rule. In the CY 2026 PFS final rule (90 FR 49656 through
49568), we incorporated this measure into the Promoting
Interoperability ASM performance category by requiring that ASM
participants complete the actions included in the MIPS Promoting
Interoperability Security Risk Analysis measure. At the time, we
believed it would help drive more secure, efficient, and meaningful use
of CEHRT under ASM.
To reduce reporting burden, beginning with the 2027 ASM performance
year, we now propose to remove the requirement at Sec.
512.740(b)(3)(ii) that an ASM participant submit an affirmative
attestation as to completing a security risk analysis within the
calendar year . We consider the use of CEHRT to demonstrate security
risk analysis and security risk management activities sufficient as it
complies with requirements pertaining to the security of data created
and maintained by CEHRT in accordance with the HIPAA Security Rule.
Given that ASM participants are covered entities under the HIPAA
Security Rule and the requirements of the Security Risk Analysis
measure are derived from the HIPAA Security Rule requirements, we do
not believe that removing the Security Risk Analysis measure from the
Promoting Interoperability ASM performance category will weaken any
cybersecurity requirements for ASM participants. Furthermore, our
proposal aligns with the proposal in MIPS to remove the Security Risk
Analysis from MIPS Promoting Interoperability; we refer readers to
section IV.A.4.f.(4) of this proposed rule for further discussion.
To conform with removal of the Security Risk Analysis measure, we
propose to redesignate current Sec. 512.740(b)(3)(iii) as Sec.
512.740(b)(3)(ii).
We seek comment on the proposal to remove the Security Risk
Analysis measure and attestation requirement from the Promoting
Interoperability ASM performance category.
(6) Supporting Providers With the Performance of CEHRT
In the CY 2026 PFS final rule (90 FR 49661), we finalized that an
ASM participant must support the performance of CEHRT by submitting
certain affirmative attestations to receive a Promoting
Interoperability ASM performance category score greater than zero.
Specifically, as finalized at Sec. Sec. 512.740(b)(4)(i)(A)(1) and
(2), an ASM participant must support the performance of CEHRT by:
Providing acknowledgement of the requirement to cooperate
in good faith with the Office of the National Coordinator for Health
Information Technology (ONC) direct review of the ASM participant's
health information technology certified under the ONC Health IT
Certification Program if a request to assist in ONC direct review is
received; and
If requested, cooperate in good faith with ONC direct
review of the ASM participant's health information technology certified
under the ONC Health IT Certification Program as authorized by 45 CFR
part 170, subpart E, to the extent that such technology meets (or can
be used to meet) the definition of CEHRT, including by permitting
timely access to such technology and demonstrating its
[[Page 43988]]
capabilities as implemented and used by the ASM participant in the
field.
An ASM participant may optionally attest to the following:
The ASM participant acknowledges the option to cooperate
in good faith with ONC-ACB surveillance of his or her health
information technology certified under the ONC Health IT Certification
Program if a request to assist in ONC-ACB surveillance is received.
If requested, that the ASM participant cooperates in good
faith with ONC-ACB surveillance of the ASM participant's health
information technology certified under the ONC Health IT Certification
Program as authorized by 45 CFR part 170, subpart E, to the extent that
such technology meets (or can be used to meet) the definition of CEHRT,
including by permitting timely access to such technology and
demonstrating its capabilities as implemented and used by the ASM
participant in the field.
Consistent with the proposal to remove these attestations from the
MIPS Promoting Interoperability performance category, we propose to
remove the ONC Direct Review attestation and ONC-ACB Surveillance
attestation from the Promoting Interoperability ASM performance
category starting in the 2027 ASM performance year.
This proposal aligns with our goals of reducing administrative
burden while focusing on high-value, outcome-oriented measures.
Removing attestations from the Promoting Interoperability ASM
performance category reduces the number of discrete manual steps and
reporting fields required for successful adherence to reporting
requirements without diminishing central goals of the Promoting
Interoperability ASM performance category.
We refer readers to section IV.A.4.f.(4) of this proposed rule for
further discussion on the proposal to remove these attestations in
MIPS.
We seek comment on the proposal to remove the ONC Direct Review
attestation and ONC-ACB Surveillance attestation.
(7) Adopting a Measure Suppression Policy for the Promoting
Interoperability ASM Performance Category
We finalized a measure suppression policy under the MIPS Promoting
Interoperability performance category beginning with the CY 2026 MIPS
performance year (90 FR 49881 through 49887). Under this policy, when
circumstances arise that impede effective measurement of a MIPS
Promoting Interoperability measure, we may suppress the measure by
excluding it from MIPS Promoting Interoperability performance category
scoring or from the determination of whether a MIPS clinician is a
meaningful EHR user for the applicable MIPS performance year (Sec.
414.1380(b)(4)(iii)).
A decision to suppress a measure does not eliminate the requirement
that MIPS eligible clinicians report the measure. However, regardless
of the data, attestation, or other information related to the
suppressed measure that is submitted by the MIPS eligible clinician,
the suppressed measure would not affect the objective's score or the
determination of meaningful EHR user status (90 FR 49883).
We also finalized suppression of the Electronic Case Reporting
measure for the CY 2025 MIPS performance year because the Centers for
Disease Control and Prevention (CDC) temporarily paused onboarding new
health care organizations for production of electronic case reporting
data and new local public health agencies for receipt of electronic
case reporting data (90 FR 49886 through 49893).
We did not adopt a measure suppression policy for the Promoting
Interoperability ASM performance category because ASM performance had
not yet begun. We stated we would monitor developments as the first ASM
performance year approaches, with the goal of maintaining alignment
with the MIPS Promoting Interoperability performance category where
possible and indicated we may propose changes in future rulemaking.
After further consideration, we propose at Sec. 512.740(c)(2) to
adopt a Promoting Interoperability measure suppression policy within
ASM starting in the 2027 ASM performance year. Specifically, we are
proposing that if certain circumstances occur that impact our
assessment of ASM participant performance on a measure specified for
the Promoting Interoperability ASM performance category under Sec.
512.740(b), we may suppress the affected measure by: (1) excluding it
from our calculation of the Promoting Interoperability ASM performance
category objective score under Sec. 512.740(c); or (2) excluding it
from the determination of meaningful EHR user status, if the affected
measure is not scored. We propose to redesignate current Sec.
512.740(c)(2) describing the Promoting Interoperability ASM performance
category scoring policy as Sec. 512.740(c)(3), without making changes
to that existing regulatory text, to describe the measure suppression
policy at Sec. 512.740(c)(2).
For an applicable ASM performance year, we propose to determine
whether circumstances warrant suppression of an ASM Promoting
Interoperability measure based on consideration of the same factors we
identified for MIPS (90 FR 49883):
The nature, breadth, and duration of the circumstance's
effect on ASM participants' ability to fulfill the measure requirement;
The availability of certified health IT modules to fulfill
the measure;
Whether the circumstance affects the measure such that
calculating the measure score would lead to misleading or inaccurate
results, including with respect to performance or compliance;
Out-of-date or conflicting technical standards;
Technical or operational capacity of required partners; or
Other factors as determined by CMS.
We are further proposing that, if we determine that a measure must
be suppressed, we would notify ASM participants through existing
communication channels. To the extent technically feasible, we intend
to notify ASM participants prior to the beginning of the applicable
data submission period. We note that, like in MIPS, the duration of
suppression for a measure in ASM would be for an entire ASM performance
year. If prolonged issues persist regarding a given circumstance, we
would assess the circumstance to determine if a measure would warrant
suppression for a subsequent ASM performance year.
We believe this policy would ensure the integrity of the ASM
scoring methodology while protecting ASM participants from being
penalized for circumstances beyond their control.
We invite public comment on our proposal at Sec. 512.740(c)(2) to
adopt the proposed measure suppression policy.
f. Final Score
(1) Background
In the CY 2026 PFS final rule (90 FR 49664 through 49679), we
adopted a scoring methodology to evaluate the annual performance of
each ASM participant through a final score. The final score represents
an ASM participant's aggregate performance on a scale of zero to 100
points based on applicable performance standards for measures and
activities in each ASM performance category. This scoring framework
promotes accountability for performance across ASM participants within
each ASM cohort. We use the final score to determine the ASM payment
adjustment factor applied to an
[[Page 43989]]
ASM participant's Medicare Part B claims for covered professional
services during the corresponding ASM payment year.
We calculate the final score based on performance in the quality,
cost, improvement activities, and Promoting Interoperability ASM
performance categories (90 FR 49677). We also established policies to
award additional points to ASM participants who furnish care to complex
patient populations and to ASM participants who are part of small
practices or who are solo practitioners (90 FR 49670 through 49676).
(2) Requirements To Receive a Final Score
In the CY 2026 PFS final rule (90 FR 49668 through 49669), we
finalized that an ASM participant must meet minimum data submission
requirement to receive a final score for an ASM performance year. An
ASM participant who does not meet these data submission requirements
receives a final score of zero points for the applicable ASM
performance year, which results in the maximum negative payment
adjustment applicable for the corresponding ASM payment year.
Conversely, an ASM participant who meets the minimum data submission
requirements but cannot be evaluated on quality and cost performance
does not receive a final score and instead receives a neutral payment
adjustment for the applicable ASM payment year. We refer readers to
Table B-D8 in the CY 2026 PFS final rule for a summary of ASM's final
score policies and their impact on payment adjustments (90 FR 49670).
After internal review of ASM's final scoring provisions, we believe
we could clarify regulatory text describing when we will not assign an
ASM participant a final score. Specifically, we propose to revise Sec.
512.745(a)(2)(iii)(B) by striking the ``Do not receive'' language that
starts Sec. Sec. 512.745(a)(2)(iii)(B)(1) and
512.745(a)(2)(iii)(B)(2). We then propose to revise Sec.
512.745(a)(2)(iii)(B) to read ``Do not receive either:'', referring to
the conditions described at Sec. Sec. 512.745(a)(2)(iii)(B)(1) and
512.745(a)(2)(iii)(B)(2). These specific changes do not introduce
substantive changes to current requirements.
We seek comment on the proposed changes to clarify the regulatory
text at Sec. 512.745(a)(2)(iii)(B).
(3) Rural Scoring Adjustment
In the CY 2026 PFS proposed rule, we considered, but did not
propose, including a rural scoring adjustment in the calculation of an
ASM participant's final score (90 FR 32604), as our analysis of
historic data did not reveal a systematic difference in expected
performance between likely ASM participants in rural and non-rural
areas. In response to our discussion considering the rural scoring
adjustment in the CY 2026 PFS proposed rule, we received interested
parties' feedback recommending that we award a rural scoring adjustment
to ASM participants in rural areas because ASM participants in rural
areas face unique demands (90 FR 49676). However, we finalized ASM's
final score policy without including a rural scoring adjustment.
The CY 2026 PFS final rule did establish policies to award
additional points on the final score to ASM participants who furnish
care to complex patient populations (up to 10 points) and to ASM
participants who are part of small practices (10 points for ASM
participants in small practices, 15 points for solo practitioner ASM
participants) (90 FR 49670 through 49676). In the CY 2026 PFS final
rule, we noted that small practice and solo practitioner scoring
adjustments better support ASM participants in small practices by
compensating for increased administrative burden and additional
reporting requirements (90 FR 49676). We noted in the CY 2026 PFS final
rule that we expected a high degree of overlap between ASM participants
in rural areas and those in small practices based on historical MIPS
performance data that we analyzed (90 FR 49677), indicating that ASM
participants in rural areas would be eligible for the small practice
scoring adjustment and be supported accordingly. We also noted that a
rural scoring adjustment could weaken incentives for ASM participants
in large rural systems to improve (90 FR 49676).
However, as supported by interested parties' comments on the CY
2026 PFS proposed rule, together with additional research and analysis,
the unique circumstances facing ASM participants in rural areas may
warrant adjustments to their final scores. We recognize that ASM
participants in rural areas may face structural challenges that affect
their ability to perform under ASM, including limited resources for
technology modernization, workforce shortages that constrain reporting
capacity, and barriers to system interoperability. A 2025 analysis of
physician participants in the Quality Payment Program found
significantly higher physician adoption of EHRs in urban areas (74
percent) compared to rural areas (64 percent).\181\ Another recent
study suggests that physicians in rural areas were less likely to
report ideal interoperability experiences for medication notes.\182\ A
report from the HHS Assistant Secretary for Technology Policy (ASTP)
notes that urban hospitals were more likely to engage in routine
interoperable exchange (47 percent were routinely interoperable) than
their rural counterparts (36 percent were routinely
interoperable).\183\ These findings align with interested parties'
feedback highlighting additional interoperability barriers faced by
rural clinicians. Accordingly, we believe ASM's existing scoring
methodology may not adequately address the complex factors that may
affect rural ASM participant's performance particularly because ASM has
a unique focus on incentivizing interoperability improvements to
strengthen care coordination.
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\181\ Anzalone AJ, Geary CR, Dai R, Watanabe-Galloway S, McClay
JC, Campbell JR. Lower electronic health record adoption and
interoperability in rural versus urban physician participants: a
cross-sectional analysis from the CMS quality payment program. BMC
Health Serv Res. 2025 Jan 23;25(1):128. doi: 10.1186/s12913-024-
12168-5. PMID: 39849475; PMCID: PMC11755824.
\182\ Everson J, Adler-Milstein J, Phillips RL, Bazemore AW,
Patel V. EHR Interoperability Experiences Reported by Family
Physicians. JAMA Netw Open. 2025;8(11):e2542460. doi:10.1001/
jamanetworkopen.2025.42460.
\183\ https://healthit.gov/data/data-briefs/interoperable-exchange-patient-health-information-among-us-hospitals-2023/.
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Additionally, our analysis of preliminary ASM participants for the
2027 ASM performance year provides an updated understanding of the
practice size of ASM participants in rural areas. In previous notice-
and-comment rulemaking, we noted that we expected ASM participants in
rural areas were primarily practicing in small practices and,
therefore, would qualify for ASM's small practice or solo practitioner
scoring adjustments (90 FR 49677). An additional rural scoring
adjustment, on top of small practice or solo practitioner adjustments,
for these ASM participants could have been duplicative and result in a
disproportionate scoring benefit. However, upon review of updated data
on preliminary ASM participants for the 2027 ASM performance year, we
found that ASM participants in rural areas are typically part of larger
practices and would be less likely to receive the small practice
scoring adjustment.
To address continued interested parties' feedback about ASM
participants in rural areas and additional analysis of preliminary ASM
participants for the 2027 ASM performance year, we are proposing the
[[Page 43990]]
inclusion of a rural scoring adjustment in the calculation of an ASM
participant's final score. We believe adding a rural scoring adjustment
would adequately increase final scores to account for the unique
challenges faced by this group of ASM participants.
To determine if an ASM participant is in a rural area, we propose
at Sec. 512.705 to adopt the same definition and determinations of a
``rural area'' as defined, interpreted, and updated at Sec. 414.1305
under MIPS. We believe that aligning our rural area definition with
MIPS will reduce confusion for ASM participants in rural areas who have
previously participated in MIPS and received associated flexibilities
with rural special status under MIPS.
To incorporate the rural scoring adjustment proposal into ASM's
regulatory text, we first propose to redesignate current Sec.
512.745(a)(5) as new Sec. 512.745(a)(6). We then propose at new Sec.
512.745(a)(5) to add 5 points to the final score of an ASM participant
who (1) is in a rural area as proposed to be defined at Sec. 512.705,
and (2) meets the requirements to receive a final score greater than
zero as described at Sec. 512.745(a)(2)(i) for an applicable ASM
performance year. We emphasize that ASM participants in rural areas
remain eligible to receive ASM's small practice or solo practitioner
scoring adjustment and the complex patient scoring adjustment if they
meet such scoring adjustment's eligibility criteria described at Sec.
512.745(a)(4) and Sec. 512.745(a)(3), respectively.
We considered but are not proposing an alternative rural scoring
adjustment policy to add 5 points to the final score of each ASM
participant who (1) is in a rural area as proposed to be defined at
Sec. 512.705, (2) meets the requirements to receive a final score
greater than zero as described at Sec. 512.745(a)(2)(i) for an
applicable ASM performance year, and (3) does not receive a small
practice scoring adjustment as described in Sec. 512.705(a)(4).
However, rural practices regardless of size often face thinner
operating margins that limit their potential investment in the quality
and technology infrastructure necessary to succeed in ASM.\184\ Uneven
access to affordable broadband may further burden ASM participants in
rural areas by financially challenging their ability to leverage health
information exchanges and data sharing.\185\ We believe that a rural
scoring adjustment for ASM participants in small and non-small rural
practices alike most accurately accounts for the potential burdens
faced by ASM participants in rural areas.
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\184\ HRSA National Advisory Committee on Rural Health and Human
Services. Interoperability and Broadband: Challenges to Rural
Information Exchange (January 2016). https://www.hrsa.gov/advisory-committees/rural-health/correspondence/20160101.
\185\ Pritzker, Penny, and Tom Vilsack. ``Broadband Opportunity
Council Report and Recommendations.'' USDA, US Department of
Commerce, 20 Aug. 2015, obamawhitehouse.archives.gov/sites/default/files/broadband_opportunity_council_report_final.pdf.
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We also considered but are not proposing an alternative policy
waiving Improvement Activity 2 (IA-2), Establishing Communication and
Collaboration Expectations with Primary Care using CCAs, for ASM
participants in rural areas. Although ASM participants in rural areas
may face challenges forming partnerships with primary care practices
due to limited primary care availability,\186\ we believe that a rural
scoring adjustment more broadly accounts for challenges that could
affect ASM participant performance across the four ASM performance
categories compared to only waiving IA-2.
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\186\ https://www.ers.usda.gov/data-products/charts-of-note/chart-detail?chartId=106208.
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To account for the proposed addition of the rural scoring
adjustment, we propose corresponding adjustments to the final score
formula at Sec. 512.745(a)(6) We also propose to revise Sec.
512.745(a) to cross-reference the final score formula now described at
Sec. 512.745(a)(6).
We seek public comment on our proposed definition of rural area at
Sec. 512.705 and our proposal at Sec. 512.745(a)(5) to add 5 points
to the final score of an ASM participant who is in a rural area and
meets the requirements to receive a final score greater than zero. We
also seek comment on the alternative we considered to only add the
rural scoring adjustment to the final scores of ASM participants in
rural areas who are not eligible to receive a small practice scoring
adjustment, as well as the alternative to waive IA-2 for ASM
participants in rural areas. We seek comment on our corresponding
proposal at Sec. 512.745(a)(6) to incorporate the rural scoring
adjustment into the final score formula.
(4) ASM Performance Report
In the CY 2026 PFS final rule (90 FR 49678), we finalized that we
will provide performance information to each ASM participant for each
ASM performance year through an annual ASM performance report. The ASM
performance report will include information on each ASM performance
category score, scoring adjustments as applicable, the final score, the
ASM payment adjustment factor, and the ASM payment multiplier.
To incorporate additional information on scoring incentives and
scoring adjustments proposed in this proposed rule, we propose to
revise the structure of the regulatory text on the ASM performance
report in Sec. 512.745(b). These proposed structural revisions to the
regulatory text's structure are intended to improve readability on the
logical flow of components of the annual ASM performance report,
starting with each ASM performance category score, scoring incentives,
scoring adjustments, final score, and ending with the resulting payment
adjustment information. These specific changes do not introduce
substantive changes to current requirements.
We also propose at revised Sec. 512.745(b)(2) to provide ASM
participants with information on whether they receive the quality ASM
performance category scoring incentive for successful voluntary
reporting of PRO data through the annual ASM performance report, as
applicable. We refer readers to section III.D.2.d.(5) of this proposed
rule for additional information on the proposed voluntary PRO data
submission and associated quality ASM performance category scoring
incentive.
We also propose at revised Sec. 512.745(b)(5) to provide ASM
participants with information on their rural scoring adjustment, if
applicable, in the annual ASM performance report.
We believe these proposals would help an ASM participant understand
their performance and whether they qualified for new scoring incentives
and scoring adjustments proposed in this proposed rule.
We seek comment on our proposed clarifying revisions to Sec.
512.745(b). We also seek comment on our proposal at Sec. 512.745(b)(2)
to provide information on the quality ASM performance category
incentive for voluntary reporting of patient-reported outcome data, as
applicable, and our proposal at Sec. 512.745(b)(5) to provide
information on the rural scoring adjustment, as applicable, in the
annual ASM performance report.
g. Payment Approach
(1) Background
In the CY 2026 PFS final rule, we finalized the overall payment
approach for ASM (90 FR 49679 through 49699). We will apply
performance-based payment adjustments to all payments for Medicare Part
B covered professional service claims from ASM participants
[[Page 43991]]
during an ASM payment year based on their performance during the
corresponding prior ASM performance year. We explained that this
approach will create meaningful financial incentives tied to
performance in the model, while maintaining administrative feasibility
and transparency (90 FR 49679 through 49680). To determine these
payment adjustments, we finalized a methodology to compare ASM
participant performance within each ASM cohort using final scores,
which reflect ASM participants' performance across the four ASM
performance categories (90 FR 49681 through 49683). We also finalized a
methodology to calculate ASM payment adjustment factors and ASM payment
multipliers used to apply the payment adjustments from the distribution
of final scores (90 FR 49685 through 49696). We also finalized the
level of two-sided risk (that is, the maximum and minimum payment
adjustment), including the gradual increase in the two-sided ASM risk
level from 9 percent in the 2027 and 2028 ASM performance years to 12
percent in the 2031 ASM performance year. We explained that this
methodology supports strong incentives for performance improvement
while maintaining ASM risk levels similar to MIPS during early model
years. We will apply the ASM payment multiplier to all payments for
Medicare Part B for covered professional services, not only those
services related to each ASM cohort's ASM targeted chronic condition,
during an ASM payment year (90 FR 49696 through 49699).
(2) Application of ASM Payment Adjustments With Changes in TIN
Affiliations
In the CY 2026 PFS final rule, we finalized that Medicare Part B
professional service claims submitted by an NPI who is an ASM
participant for an ASM performance year but under a TIN (1) that we did
not select the NPI as an ASM participant for the applicable ASM
performance year and (2) to which the NPI began assigning billing
rights after the ASM performance year but before the end of the
corresponding ASM payment year would be adjusted using the ASM payment
multiplier calculated for the ASM participant. In the limited instances
where a single NPI is selected as an ASM participant under multiple
TINs for an ASM performance year, we finalized that we would apply the
highest of any ASM payment multipliers to all Medicare Part B covered
professional service claims submitted under a new TIN during the
applicable ASM payment year (90 FR 49696). We refer readers to Table B-
D10 in the CY 2026 PFS final rule for additional information on how ASM
payment adjustments will be applied under multiple scenarios (90 FR
49697). The goal of these policies is to maintain accountability for
the ASM participant's performance through the application of their
performance-based payment adjustments. By doing so, we track
accountability to the ASM participant regardless of their specific TIN
affiliation at the time we make payment adjustments.
While we are not proposing substantive changes to these policies in
this proposed rule, we note that there are inconsistencies in the
regulatory text describing how we will adjust payment in situations
where the ASM participant begins reassigning billing rights to a new
TIN during an ASM payment year.
Accordingly, to maintain consistency with the regulatory text
governing the application of ASM's payment adjustments as described at
Sec. 512.750(a), at Sec. Sec. 512.750(f)(1) and (f)(2), we propose to
revise the regulatory text at Sec. 512.750(f) to replace the phrases
``adjusts payments'' and ``adjust claims'' with ``multiplies the amount
otherwise paid under Medicare Part B for covered professional
services''. We are also proposing clarifying revisions to Sec.
512.750(f)(1). We propose to remove unnecessary text at Sec.
512.750(f)(1)(i) because we only calculate ASM payment multipliers for
ASM participants with final scores as described at Sec. 512.750(c)(1).
To improve readability of the provision with the proposed removal of
Sec. 512.750(f)(1)(i), we propose to revise Sec. 512.750(f)(1) to
incorporate the text previously described at Sec. 512.750(f)(ii).
We are also proposing revisions to clarify how we would adjust
payments for NPIs selected as ASM participants under multiple TINs and
who reassign billing rights to a new TIN after an ASM performance year.
Accordingly, we propose to remove unnecessary language in Sec.
512.750(f)(2) and Sec. 512.750(f)(2)(i) to more clearly describe how
we would adjust payments using the highest ASM payment multiplier
calculated for an NPI who we select as an ASM participant under
multiple TINs. We also propose at Sec. 512.750(f)(2)(ii) to replace
the phrase ``assigning billing rights'' with ``reassigning billing
rights'' to improve the accuracy of the regulatory text. These
proposals do not create substantive changes to the proposed policies
but would ensure clarity and consistency in language used to describe
the application of payment adjustments under ASM under Sec. 512.750.
We seek comment on our proposals to revise the regulatory text at
Sec. 512.750(f)(1) and Sec. 512.750(f)(2).
h. Applicability of CMS-Sponsored Model Safe Harbor at 42
CFR[thinsp]1001.952(ii)
In the CY 2026 PFS final rule, we determined that the CMS- model
arrangements and patient incentives safe harbor at Sec. 1001.952(ii)
would be available to ASM participants that comply with applicable
requirements (90 FR 49709) and codified the availability of the safe
harbor for ASM at Sec. 512.765 in regard to remuneration associated
with beneficiary incentives and remuneration exchanged under CCAs.
Once a clinician is selected as an ASM participant for any ASM
performance year during the ASM test period, that clinician remains an
ASM participant for the duration of the ASM test period. However, in
limited circumstances, an ASM participant may not be required to meet
specified model requirements for a given ASM performance year.
Specifically, if we determine that an ASM participant does not satisfy
the ASM participant eligibility criteria as specified under Sec.
512.710(a)(2) or is determined to meet an exception under Sec.
512.710(c) for a given ASM performance year, the ASM participant is
not: (1) subject to ASM performance assessment under Sec. 512.715, (2)
required to submit data under Sec. 512.720, (3) subject to final
scoring under Sec. 512.745, and (4) eligible for the waivers available
under the model described at Sec. 512.775 (90 FR 49572, 90 FR 49583).
We finalized the application of these policies in the CY 2026 PFS
final rule, however, we did not address the availability of the CMS-
sponsored model arrangements and patient incentives safe harbor under
Sec. 1001.952(ii), as made available for ASM at Sec. 512.765, in
instances where an ASM participant is not subject to specified ASM
requirements due to not meeting ASM participant eligibility criteria as
described in Sec. 512.710(a)(2) or a determination that an exception
applies under Sec. 512.710(c).
We now propose that the CMS-sponsored model arrangements and
patient incentives safe harbor would be available only for remuneration
attributable to periods during which an ASM participant is performing
under the model. Conversely, the CMS-sponsored model arrangements and
patient incentives safe harbor would not be available for remuneration
[[Page 43992]]
attributable to a period during which an ASM participant is not
performing under the model due to not meeting ASM participant
eligibility criteria as described at Sec. 512.710(a)(2) or a
determination that an exception applies under Sec. 512.710(c).
We believe this proposal appropriately ties the availability of the
model-specific safe harbor to underlying model activities performed
during a period of model performance. For example, we recognize that
remuneration associated with a CCA may not be exchanged
contemporaneously with the ASM performance year to which it relates. In
such instance, remuneration exchanged pursuant to a CCA may be
calculated based on an ASM participant's performance during an ASM
performance year in which the ASM participant was eligible for and not
excepted from ASM performance but may not be exchanged until a
subsequent year because the applicable ASM payment adjustment factor,
and net payment adjustment, would not calculated until after the close
of the ASM performance year. An ASM participant who reassigns billing
rights to a new TIN or redesignates their primary specialty type mid-
ASM performance year may be excepted from ASM participation for that
performance year under Sec. 512.710(c). In such instance, the ASM
participant may rely on the availability of the safe harbor during the
portion of the year in which they were performing under the model. Our
proposal is not intended to retrospectively render the safe harbor
unavailable with respect to remuneration attributable to the period in
which the ASM participant was actively performing under the model and
all applicable safe harbor requirements were satisfied. The limitation
on safe harbor availability described at proposed Sec. 512.765(c)
would apply prospectively from the date we determine the exception
applies under Sec. 512.710(c).
Accordingly, we propose that the availability of the CMS-sponsored
model safe harbor would depend on the period of ASM performance to
which the remuneration is attributable.
Specifically, we propose to add Sec. 512.765(c) to state that the
CMS-sponsored model arrangements and patient incentives safe harbor is
available only with respect to remuneration attributable to a period in
which the ASM participant was performing under the model, and is not
available with respect to remuneration attributable to any period of
the ASM test period for which the ASM participant does not meet ASM
participant eligibility criteria under Sec. 512.710(a)(2) or is
excepted from specified ASM requirements under Sec. 512.710(c).
Limiting the availability of the safe harbor to remuneration
attributable to model performance helps support program integrity and
beneficiary protections while preserving flexibility for ASM
participants to use incentives that support patient and primary care
engagement in performance activities aligned with the model's purpose.
We seek comment on this proposal.
i. Collaborative Care Arrangements (CCAs)
(1) Background
The improvement activities ASM performance category is intended to
advance core goals of ASM to drive better outcomes through improved
care coordination, increased collaboration between specialists and
primary care practices, and interventions that address upstream drivers
of health.
We finalized two improvement activities for ASM in the CY 2026 PFS
final rule at Sec. 512.735 that we believe best support these aims:
Improvement Activity 1 (IA-1): Connecting to Primary Care
and Ensuring Completion of Health-Related Social Needs Screening; and
Improvement Activity 2 (IA-2): Establishing Communication
and Collaboration Expectations with Primary Care using CCAs (90 FR
49648 through 49655).
To receive the maximum score available for the improvement
activities ASM performance category, an ASM participant must attest
``yes'' to both improvement activities.
IA-2 specifications require an ASM participant to enter into at
least one collaborative care arrangement (CCA) with a primary care
practice with which the ASM participant shares a patient who is an ASM
beneficiary. IA-2 also requires that a CCA address at least three of
the five elements specified at Sec. 512.735(c)(2)(ii): data sharing,
co-management, transitions in care planning, closed-loop connection,
and care coordination integration.
In addition to IA-2 specifications at Sec. 512.735(c)(2)(ii), we
outline requirements for CCAs at Sec. 512.771. The function of the CCA
is to memorialize the coordination activities central to ASM and
described in IA-2.
We now propose certain updates to the CCA provisions at Sec.
512.771 to improve implementation by ASM participants and primary care
practices and to more closely align CCA conditions with IA-2 by
revising Sec. 512.771(a) and adding new paragraph Sec. 512.771(d). In
summary, and as discussed in detail in respective sections of this
proposed rule, our proposed changes to Sec. 512.771 include:
Permitting one or more ASM participant to enter into a CCA
with the same primary care practice, provided each ASM participant
reassigns billing rights through the same entity's TIN and are named as
parties to the CCA;
Clarifying the requirement that an ASM participant and a
primary care practice share a patient who is an ASM beneficiary and how
this requirement applies in the context of the limitation on
considering the volume or value of referrals;
Streamlining the provision containing an illustrative list
of authorities with which parties to a CCA must comply to simplify it,
improve clarity, and reduce ambiguity;
Updating the provisions that currently reference any
elective exchange of payments between CCA parties to instead refer to
the elective exchange of remuneration, to reflect a broader scope of
value that may be exchanged under a CCA;
Reorganizing regulatory requirements under Sec.
512.771(a) that are associated only with the exchange of any elective
remuneration under a CCA such that they appear together under a new
paragraph at Sec. 512.771(d) to bring greater clarity and to
distinguish between those requirements that apply to all CCAs and those
that apply only to CCAs that electively include the exchange
remuneration;
Revising the payment limitation that caps the exchange of
remuneration based on an ASM participant's performance adjustment such
that it can be more readily calculated in a timely manner and requiring
that parties that elect to exchange remuneration before the limitation
can be calculated reconcile any amounts that exceed the limitation
following reconciliation;
Clarifying that current requirements relating to
traceability will continue to apply to monetary remuneration;
Updating the contemporaneous documentation requirements to
reflect any remuneration exchanged and add requirements to bring
transparency into the methodologies used to determine the value of such
remuneration; and
Relocating the conditions associated with remuneration at
current Sec. Sec. 512.771(a)(7) and 512.771(a)(8) to new paragraphs
Sec. Sec. 512.771(d)(2) and 512.771(d)(3), respectively, in accordance
with our proposal to address requirements associated with CCAs that
include an exchange of remuneration
[[Page 43993]]
together under one paragraph. To conform with this relocation, we would
redesignate existing sections Sec. Sec. 512.771(a)(9) through
512.771(a)(13) to Sec. Sec. 512.771(a)(7) through 512.771(a)(11). We
would revise newly redesignated Sec. 512.771(a)(7) (former Sec.
512.771(a)(9)) to reference ``[a]ll parties'' rather than ``[b]oth
parties'' and revise newly redesignated Sec. 512.771(a)(9) (former
Sec. 512.771(a)(11)) to update documentation requirements as
described, but otherwise would not revise text at newly redesignated
Sec. 512.771(a)(8) (former Sec. 512.771(a)(10)), Sec. 512.771(a)(10)
(former Sec. 512.771(a)(12)), or Sec. 512.771(a)(11) (former Sec.
512.771(a)(13)).
(2) Parties to a CCA
In the CY 2026 PFS final rule, we finalized at Sec. 512.771(a)(1)
a requirement that a CCA be in writing, signed by both parties, and
contain the effective date of the arrangement. We also finalized at
Sec. 512.771(a)(2) a requirement that a CCA be exclusively between an
ASM participant and a primary care practice with which the ASM
participant shares at least one established patient who is an ASM
beneficiary. At that time, we considered, but declined to permit,
multiple ASM participants reassigning billing rights through the same
TIN to be parties to a single CCA with a primary care practice party,
citing concerns around the ability of ASM participants to accurately
track any remuneration exchanged under a multi-ASM participant
arrangement (90 FR 49712).
Following publication of the CY 2026 PFS final rule, we received
interested party feedback anticipating significant burden associated
with establishing separate CCAs for each individual ASM participant
when more than one ASM participant is in the same group practice and
such ASM participants wish to collaborate with the same primary care
practice. As an example, 20 ASM participants operate within a single
health system and reassign their billing rights to that system's TIN.
Even if such ASM participants coordinate care regularly with the same
primary care practice and wish to establish a CCA with the same primary
care practice, the current regulation would require negotiation,
execution, documentation, and tracking of 20 separate CCAs.
We believe that requiring a separate CCA for each ASM participant
could impose administrative burden without a corresponding programmatic
benefit. We now believe that concerns related to tracking remuneration
under CCAs involving multiple ASM participants could be addressed
through more targeted safeguards that apply to CCAs that elect to
include remuneration, rather than a broader restriction applicable to
all CCAs, including those that do not involve any exchange of
remuneration.
Accordingly, we propose to amend Sec. Sec. 512.771(a)(1) and
512.771(a)(2) to permit one or more ASM participants to be parties to
the same CCA, subject to defined conditions. First, each ASM
participant would be required to be explicitly named as a party to the
CCA. Second, we propose that for multiple ASM participants to
participate in the same CCA, all such ASM participants would be
required to reassign billing rights to the same TIN. We would maintain
the existing requirements at Sec. 512.771(a)(1) that the CCA be in
writing and specify an effective date; we would also maintain the
requirement that a CCA be signed by the parties but propose to amend
regulatory text to stipulate CCA execution would be required for
``all'' parties rather than ``both'' parties.
We believe restricting a multi-ASM participant CCA to ASM
participants within the same TIN is appropriate as clinicians who
practice under the same group practice are more likely to be supported
by shared operations, such as shared EHR systems, clinical support
staff, and standardized administrative workflows. Accordingly, we
believe terms of a CCA could be standardized across ASM participants
within the same organization (that is, TIN) without compromising the
level of detail needed to support meaningful care coordination. In
contrast, ASM participants from separate, unaffiliated TINs may have
distinct infrastructure, care coordination needs, support structures,
and operational workflows. It is therefore unclear how a single
arrangement could establish cohesive terms regarding shared
responsibilities with a primary care partner in a manner consistent
with the intent of CCAs. We are concerned that attempting to encompass
these different capabilities and variable workflows within a single
agreement could result in vague, overly broad, or highly fragmented
contractual terms, which could undermine the intent of the CCA.
Our proposal to permit one or more ASM participants billing under
the same TIN to join the same CCA with a primary care partner does not
alter ASM's fundamental accountability framework. As noted, we propose
to clarify that any ASM participant seeking to join and rely on one CCA
be expressly named as a party to the arrangement. We believe such
requirement maintains individual ASM participant accountability, while
reducing administrative burden. We are not proposing to permit a group
practice or TIN to serve as a sole contracting party on behalf of
unnamed ASM participants, as this could obfuscate individual ASM
participant accountability and introduce operational complexity,
particularly when an ASM participant departs a group practice during an
ASM performance year. Requiring each ASM participant to be named as a
party would mitigate such concerns while still reducing contracting
burden.
We wish to emphasize that our proposals do not preclude an ASM
participant's group practice from supporting the ASM participant or ASM
participants with administrative functions associated with a CCA, such
as recordkeeping or maintaining documentation on ASM participants'
behalf, provided such support is consistent with other applicable
authorities. Such administrative support does not substitute for the
requirement that each ASM participant be named as a party and remain
accountable for the core responsibilities described by the model and
CCAs. Rather, we intend for our proposals to better account for the
operational realities of group practices and the nature of the
activities envisioned by a CCA, which inherently entails practice-level
support. We do not intend for our proposals to disrupt such support
arrangements.
We also note that we do not intend, and do not propose, to impose
prescriptive requirements around the meaning of a ``primary care
practice'' that must be a party to a CCA. Our intent is that a CCA
reflects coordination between the ASM participant and their ASM
beneficiary's source of primary care services. We refer readers to
discussion in response to interested party questions in the CY 2026 PFS
final rule for further information (90 FR 49653).
Our proposal is also intended to reduce burden for ASM participants
who practice within the same group and coordinate care with the same
primary care practice. It is not intended to discourage individual
CCAs. ASM participants who belong to the same group may continue to
enter into separate CCAs and should consider a separate arrangement
when doing so better reflects individual clinical relationships,
sources of primary care for their individual ASM beneficiary panel, and
care coordination needs. We also continue to encourage ASM participants
to consider entering into multiple CCAs to the extent it would support
meaningful coordination for a
[[Page 43994]]
broader population of ASM beneficiaries but note that only one CCA is
required to meet IA-2 specifications.
We seek comment on these proposals, including whether it would
reduce administrative burden to permit more than one ASM participant to
enter the same CCA while preserving individual accountability, program
integrity, and appropriate oversight. We also seek feedback on whether
this proposal could be read as disadvantaging ASM participants who are
solo practitioners or part of a group practice where they are the only
selected ASM participant. We do not believe this proposal would have
any negative effect on these ASM participants, but we invite interested
party perspectives on this.
(3) Requirement That CCA Parties Share a Patient Who Is an ASM
Beneficiary
Sections 512.735(c)(2)(i) and 512.771(a)(2) both require that
parties to a CCA share a patient who is an ASM beneficiary. Under our
proposal to permit more than one ASM participant to join the same CCA,
we would maintain the requirement at proposed revised Sec.
512.771(a)(2) that an ASM participant party or ASM participant parties
and the primary care practice party share at least one patient who is
an ASM beneficiary. That is, the requirement that an ASM participant
party or ASM participant parties and the primary care practice share a
patient who is an ASM beneficiary would be satisfied so long as at
least one shared patient who is ASM beneficiary exists between any one
ASM participant party to the CCA and the primary care practice party,
regardless of the total number of ASM participants who are parties to
that CCA.
We emphasize that the purpose of the requirement to share ``one or
more'' patients who are ASM beneficiaries is to ensure a clear nexus
exists between the CCA and coordination activities on behalf of ASM
beneficiaries for whom both the primary care practice party and ASM
participants have a care relationship. In the absence of shared ASM
beneficiaries, there would be no care relationship to coordinate and,
therefore, no basis for a CCA. We require only one shared ASM
beneficiary as a minimum threshold condition because we believe that
parties who commit to meaningfully coordinate care in a manner
consistent with the purpose of a CCA will, organically, identify and
collaborate on behalf of a much broader shared patient population as
the arrangement is implemented. Thus, we continue to underscore, as we
did in the CY 2026 PFS final rule (90 FR 49712 through 49713), that we
encourage ASM participants to select primary care partners with whom
they share multiple ASM beneficiaries as this would more meaningfully
fulfill the goals of the CCA.
Lastly, current Sec. 512.771(a)(2) requires that, for the purposes
of the shared ASM beneficiary requirement, the ASM beneficiary must be
an ``established'' patient. IA-2 specifications at Sec.
512.735(c)(2)(i) does not include the ``established'' qualifier. Upon
further review, we do not believe it is necessary to include the term
``established'' in CCA regulations and therefore propose to strike the
term ``established'' at Sec. 512.771(a)(2) to conform with IA-2
specifications.
We seek comment on our proposal to require at least one shared
patient who is an ASM beneficiary under a CCA regardless of how many
ASM participants are parties to such CCA. We invite feedback on whether
requiring one shared patient who is an ASM beneficiary is sufficient to
encourage the coordination goals envisioned by CCAs. We also seek
comment on our proposal to remove the term ``established'' from CCA
regulations at Sec. 512.771(a)(2).
(4) Requirement To Comply With Applicable Laws
We finalized in the CY 2026 PFS final rule at Sec. 512.771(a)(5)
that both parties to a CCA must comply with all applicable statutes,
regulations, and guidance, including without limitation: Federal
criminal laws; the False Claims Act (31 U.S.C. 3729 et seq.); the anti-
kickback statute (42 U.S.C 1320a-7b(b)); the civil monetary penalties
law (42 U.S.C. 1320a-7a); and the physician self-referral law (42
U.S.C. 1395nn).
We now believe the illustrative list at Sec. 512.771(a)(5) is
unnecessary and that a simplified version of regulatory text may reduce
potential confusion. Accordingly, we are proposing to remove the
illustrative list of legal authorities and instead retain only the
requirement that both parties to a CCA comply with all applicable
statutes, regulations, and guidance. To conform with other proposals to
Sec. 512.771, we also propose to amend regulatory text to strike
reference to ``[b]oth'' parties and instead require that ``[a]ll''
parties comply with this provision.
We invite comment on the proposed changes.
(5) Restriction on Conditioning Remuneration on Referrals
In the CY 2026 PFS final rule, we established that neither the
opportunity to enter a CCA nor the amount of any payment under a CCA
may be conditioned, directly or indirectly, on the volume or value of
past or anticipated referrals or business generated by, between, or
among the parties to the arrangement or any other person (90 FR 49711).
Separately, Sec. 512.771(a)(2) requires that an ASM participant and a
primary care practice party to a CCA share at least one patient who is
an ASM beneficiary.
Upon further consideration, we are concerned that the current
language at Sec. 512.771(a)(6) on conditioning entry into a CCA, in
the context of the requirement for shared ASM beneficiaries at Sec.
512.771(a)(2), may be read to unnecessarily constrain the formation of
the type of arrangements the model is designed to promote. Because
shared ASM beneficiaries among parties to a CCA may result from
existing care relationships between ASM participants and primary care
practices, the current language of Sec. 512.771(a)(6) could be read to
prohibit potential collaborators from considering the beneficiary-
sharing relationship required by Sec. 512.771(a)(2). We did not intend
the prohibition on conditioning entry into a CCA on referrals or
business generated to prevent parties from considering whether they
satisfy the shared-beneficiary requirement that is itself a requirement
to CCAs.
Accordingly, we propose to revise Sec. 512.771(a)(6) that an ASM
participant may consider, as one criterion for entering into a CCA,
whether they share at least one ASM beneficiary with a primary care
practice. We propose that this would not violate the volume or value
standard in Sec. 512.771(a)(6) if the purpose of such criteria is to
further the purpose of the CCA. This clarification is intended to
remove an unintended barrier to CCA formation while preserving the
prohibition on entering into arrangements based on referral patterns or
that reward or induce referrals or other business generated.
This targeted revision would permit parties to consider whether
they share one or more ASM beneficiaries only for purposes of
satisfying the shared-beneficiary requirement at Sec. 512.771(a)(2)
and furthering the purpose of the CCA.
We seek comment on this proposal. We also invite comment on whether
the proposed approach is sufficiently clear and appropriately
accommodates the operational realities of how practices contemplate
establishing CCAs.
(6) CCAs That Include the Exchange of Remuneration
In the CY 2026 PFS final rule, we stated our intent to allow ASM
participants and their primary care
[[Page 43995]]
partners to negotiate arrangements that are best suited to their
practices (90 FR 49712). We also recognized that parties to a CCA may
wish to include model-related incentives under a CCA to support shared
accountability for the outcomes of ASM beneficiaries and to support
coordination activities that benefit shared patients (90 FR 49713).
Accordingly, we made the CMS-sponsored model arrangements safe harbor
at Sec. 1001.952(ii)(1) available under ASM at Sec. 512.765 to
protect remuneration exchanged under a CCA, provided that all
requirements of the safe harbor at Sec. 1001.952(ii)(1) and CCA
regulations at Sec. 512.771 are met (90 FR 49713).
Upon further review, we believe that provisions of Sec. 512.771
that refer to payments exchanged under a CCA should be revised to apply
more broadly to remuneration exchanged under a CCA to the extent
applicable. Applying these provisions to remuneration would better
align Sec. 512.771 with Sec. 512.765 and the CMS-sponsored model
arrangements safe harbor at Sec. 1001.952(ii)(1), both of which
address remuneration. It would also more accurately reflect the full
range of value that parties may exchange under a CCA, including
monetary payments and in-kind items or services that support care
coordination and other model-related activities.
Accordingly, we propose to revise Sec. 512.771 such that
applicable provisions referencing payment instead reflect and apply
more broadly to remuneration exchanged under a CCA. We believe this
proposed modification would clarify that safe harbor protections and
requirements in Sec. 512.771 apply to both monetary and in-kind
remuneration exchanged under a CCA. We emphasize that remuneration is
not a required element of a CCA. Rather, parties to a CCAs may elect to
include monetary or in-kind incentives that promote improvement
activities or the goals of the model, provided that all applicable
requirements are met (90 FR 49654). In-kind remuneration, such as
shared data analytics platforms, care managers, or technology
infrastructure could support the type of care coordination envisioned
by ASM.
We also propose to add new paragraph Sec. 512.771(d) to introduce
the requirements that apply when parties to a CCA elect to exchange
remuneration and to relocate the proposed, revised conditions
applicable to remuneration under a CCA such that they appear together
under new paragraph Sec. 512.771(d). We believe this construction
would more clearly distinguish the regulatory requirements that apply
to all CCAs from the additional conditions that apply when remuneration
is exchanged under a CCA.
We seek comment on our proposals to address remuneration, as
applicable, throughout Sec. 512.771 rather than just payment, and to
reorganize Sec. 512.771 such that conditions associated with
remuneration at current Sec. Sec. 512.771(a)(7) and (a)(8) are located
under new paragraph Sec. 512.771(d) at Sec. Sec. 512.771(d)(2) and
(d)(3), respectively. We are interested in whether the proposed
reorganization would bring greater clarity to our regulations.
We also welcome comment on the types of services and remuneration
that specialists and primary care partners exchange or contemplate
exchanging to support and encourage coordination and collaboration
goals, as we described in the CY 2026 PFS final rule (90 FR 49712). We
remain interested in learning about the types of remuneration used to
support collaborative care, such as shared personnel, infrastructure,
data analytics, care management resources, technology, or other in-kind
items or services, so that we may more clearly understand how such
incentives are used to promote activities designed to aid coordination
and can consider such feedback in future rulemaking.
(a) Requirement for Remuneration to Reasonably Relate to CCA Purpose
In the CY 2026 PFS final rule, we finalized at Sec. 512.771(a)(3)
that a CCA must be entered into for the purpose of either furthering
the ASM participant's performance in the improvement activities ASM
performance category or furthering the clinical goals of the model as
described by Sec. 512.771(b) (90 FR 49712 through 49714).
We did not include a corresponding requirement that any
remuneration exchanged under a CCA connect to those purposes. Upon
further review, we are concerned that, absent such a requirement,
remuneration could be structured in a manner that is not sufficiently
connected to the objectives the CCA intends to support.
We propose that any remuneration exchanged by the ASM participant
party or parties and the primary care practice party to a CCA would be
required to have a reasonable relationship to activities undertaken to
further the ASM participant's performance in the improvement activities
ASM performance category or to advance the model's clinical goals,
which are: (1) promoting preventive care through improved management of
ASM targeted chronic conditions; (2) empowering patients to actively
participate and be accountable for quality and whole health outcomes;
and (3) facilitating meaningful and efficient coordination between
specialists and primary care providers to increase independent
physician participation in value-based payment programs.
Specifically, we propose to require at new Sec. 512.771(d)(1) that
any remuneration exchanged by the parties to a CCA be reasonably
related to the purpose of the CCA, as defined in Sec. 512.771(a)(3).
We believe that aligning the purpose of any exchange of remuneration
with the purpose of the CCA would support bona fide care coordination
incentives while protecting program integrity. We do not anticipate
that this requirement will result in any meaningful increase in
compliance burden, particularly since including remuneration under a
CCA is voluntary and because we already require that a CCA be entered
into for the purposes specified at Sec. 512.771(a)(3).
We seek comment on our proposal at Sec. 512.771(d)(1) to require
that any remuneration exchanged under a CCA be reasonably related to
the purpose of the arrangement, consistent with Sec. 512.771(a)(3).
(b) Limitation on Remuneration
In the CY 2026 PFS final rule (90 FR 49712 through 49714), we
finalized a limitation to the amount of any payments exchanged under a
CCA at Sec. 512.771(a)(7). Specifically, we finalized a requirement
that any payment exchanged under a CCA must not exceed the sum total of
the payment adjustments made to an ASM participant's claims for a given
ASM payment year, which would be calculated based on the of application
of the ASM payment adjustment factor to the ASM participant's payments
for Medicare Part B covered professional services during the
corresponding ASM payment year.
Our intent was to ensure that any financial or in-kind exchanges
between CCA parties remain appropriately tied to patient outcomes and
ASM's clinical goals (90 FR 49712).
Upon further consideration, we believe the current methodology may
be difficult for parties to operationalize and warrants revision. ASM
payment adjustments are applied 2 CYs after the applicable ASM
performance year. As a result, the information needed to determine the
maximum amount permitted to be exchanged may not be available until
well after the close of the applicable ASM performance year. This could
create operational difficulty for
[[Page 43996]]
parties that wish to exchange remuneration during or near the ASM
performance year when care coordination activities are occurring.
Accordingly, we propose updates to modify the temporal period used
to calculate this limitation and provide for a reconciliation and
repayment process to support compliance with the limitation. Consistent
with our organizational update to Sec. 512.771, we propose to include
the revised limitation on remuneration in new Sec. 512.771(d)(2).
We propose to maintain a limitation on the amount of remuneration
exchanged under a CCA and to tie that limitation to performance-based
payment adjustments made to an ASM participant's payments for Medicare
Part B covered professional services. However, we propose that this
limitation would be calculated using the ASM participant's ASM payment
adjustment factor for the applicable ASM performance year, multiplied
by the amount otherwise paid to the ASM participant by CMS under
Medicare Part B for covered professional services during that ASM
performance year. Stated another way, the proposed revision would
change the temporal period used to calculate the limitation amount from
the ASM payment year to the ASM performance year. Under both the
current and proposed methodologies, the operative component is the ASM
payment adjustment factor based on performance for the ASM performance
year; the proposed revision changes only the temporal period used to
calculate the limitation amount.
In accordance with our proposal permitting more than one ASM
participant to join the same CCA, we propose to clarify that the
remuneration limitation under proposed Sec. 512.771(d)(2) would be
calculated separately for each ASM participant that is a party to a
CCA. This means that, where more than one ASM participant is included
in the same CCA, the limitation on the amount of remuneration that may
be exchanged under the arrangement would be calculated per each ASM
participant. Accordingly, the remuneration limitation would be
calculated separately for each ASM participant based on that ASM
participant's ASM payment adjustment factor and the amount otherwise
paid to that ASM participant by CMS under Medicare Part B for covered
professional services during the applicable ASM performance year. We
believe this clarification is necessary to preserve individual ASM
participant accountability while allowing multiple ASM participants to
participate in a single CCA where appropriate.
We are also proposing additional safeguards to support consistent
implementation of this limitation. Specifically, under proposed Sec.
512.771(d)(2)(i), the CCA would be required to specify a methodology
for identifying and calculating the total value of remuneration
exchanged under the arrangement for the ASM performance year and
determine whether the total value exceeds the applicable limitation. To
the extent that remuneration is in-kind, we propose at Sec.
512.771(d)(2)(ii) that the valuation of such remuneration would be
based on the offeror's costs using any reasonable accounting
methodology, or the fair market value of the in-kind item or service.
We believe this would support ASM participants that elect to exchange
in-kind remuneration in ensuring such exchange complies with our
regulations. Under proposed Sec. 512.771(d)(2)(iii), the arrangement
would be required to provide for reconciliation, if applicable, after
the limitation is determined. Under proposed Sec. 512.771(d)(2)(iv),
if the total value of remuneration exchanged under the arrangement for
the ASM performance year exceeds the limitation, the party that
received the excess amount would be required to repay that excess
amount to the other party within a reasonable time. We believe these
provisions would promote consistent administration, clarify compliance
requirements, and facilitate CMS oversight. We anticipate that these
revisions to the remuneration limitation would establish a more viable
pathway for parties to exchange remuneration during or close to the
applicable ASM performance year by offering greater regulatory
certainty that, should those exchanges exceed the final limitation,
there would be a defined mechanism to reconcile the difference later.
We recognize the inherent complexity with a limitation based on a
mathematical formula as described in proposed Sec. 512.771(d)(2) in
the context of in-kind remuneration. Valuing in-kind remuneration to
ensure it does not exceed the calculated threshold, and 'repaying'
excess in-kind value during the reconciliation process, may present
operational difficulties that could impede good faith exchanges of in-
kind items or services intended to support the purpose of the CCA. We
considered but are not proposing an alternative where the limitation in
proposed Sec. 512.771(d)(2) would apply only to monetary payments (or
cash equivalents) exchanged under a CCA. Under such alternative, we
would establish a separate limitation for in-kind remuneration, such as
requiring that any in-kind items or services exchanged meet a fair
market value and commercial reasonableness standard rather than a
limitation based on a dollar amount. While a separate safeguard
tailored to in-kind remuneration could ease operational burden for ASM
participants and their primary care partners, we believe that having
one mathematical formula for valuing any remuneration exchanged under a
CCA would be simpler for parties to CCAs to implement and therefore did
not propose this approach.
We seek comment on these proposals, including the proposed update
for calculating the limitation using the ASM performance year rather
than the corresponding ASM payment year, the methodology and
reconciliation requirements at proposed Sec. 512.771(d)(2) and whether
the proposed updates bring greater clarity to requirements that apply
to CCAs that elect to include remuneration. We also seek comment on the
alternative considered for in-kind remuneration limitations.
(c) Other Requirements for Remuneration Exchanged Under a CCA
We finalized in the CY 2026 PFS final rule that any payment
exchanged under a CCA must be solely between the parties and be made by
check, electronic funds transfer, or another traceable cash transaction
(Sec. 512.771(a)(8)) (90 FR 49712 through 49714). Consistent with our
organizational update to Sec. 512.771, we propose to include this
requirement, with revisions to address remuneration more broadly, in
new Sec. 512.771(d)(3).
Specifically, we would require that any remuneration exchanged
under a CCA be solely between the parties and that, to the extent the
exchange is a monetary payment, payment must be made by check,
electronic funds transfer, or other traceable transaction at Sec.
512.771(d)(3).
We seek comment on these proposals.
(d) Documentation Requirements
We finalized a requirement that ASM participants maintain
contemporaneous documentation regarding all CCAs, including the
relevant agreement and date and amount of payment at Sec.
512.771(a)(11).
We propose to update documentation requirements to better support
ASM participants and their primary care partners in their compliance
with applicable regulations and to update references to conform with
other changes proposed under Sec. 512.771, including that we propose
to
[[Page 43997]]
redesignate existing Sec. 512.711(a)(11) to Sec. 512.711(a)(9).
Specifically, we propose to revise the documentation requirement at
proposed revised Sec. 512.771(a)(9) such that an ASM participant would
be required to maintain contemporaneous documentation, in accordance
with Sec. 512.135, regarding all CCAs entered into, records of all
remuneration exchanged for each ASM participant under a CCA, a
description of the remuneration, the value of the remuneration, the
methodology for determining the value of any in-kind remuneration, and
the date on which the remuneration was exchanged.
We also propose to require documentation of the identity of each
ASM participant that would be a party to the CCA. We propose this
change to conform with our proposal that a CCA may include more than
one ASM participant to promote appropriate recordkeeping regarding the
identity of each ASM participant covered by a CCA.
Together, we believe these proposed changes would clarify the
minimum documentation that must be maintained by an ASM participant,
better support compliance, and reduce ambiguity regarding documentation
when a CCA includes multiple ASM participants as parties. These
proposed changes would be reflected in proposed revised Sec.
512.771(a)(9), if finalized.
We considered requiring that ASM participants maintain
documentation supporting that all ASM participants who join the same
CCA reassign their billing rights through the same TIN as a safeguard
supporting compliance with our proposal that, if more than one ASM
participant joins as a party to a CCA, such ASM participants must all
reassign billing rights to the same TIN. We did not propose this
approach as we believe we would be able to verify this information
based on data already available to us.
We seek comment on these proposed changes. We also seek comment on
the alternative documentation approach we considered and whether this
approach would better support compliance and monitoring.
j. Medicare Program Waivers
In the CY 2026 PFS final rule, we adopted a policy at Sec. 512.775
whereby we waive MIPS reporting obligations for an ASM participant in
each ASM performance year in which the ASM participant meets ASM
eligibility criteria at Sec. 512.710(b), except as specified in Sec.
512.710(a)(2). Section 512.710(a)(2) describes an ASM participant who
does not meet eligibility requirements for mandatory participation in
ASM for a given ASM performance year.
We also discussed in the CY 2026 PFS final rule how the waiver
pertaining to MIPS reporting obligations would not apply in instances
where an ASM participant is not subject to specified ASM performance
requirements due to a change in TIN (90 FR 49582). However, the
regulatory text at Sec. 512.771(a) does explicitly reflect this
policy.
Accordingly, we propose to update Sec. 512.775(a) to replace the
reference to ``Sec. 512.710(a)(2)'' with ``Sec. 512.710(a)(2) or
Sec. 512.710(c)'' such that the regulatory text accurately reflects
our policy.
We seek comment on this proposal.
E. Limiting Medicare Coverage of Certain Individuals
1. Background
On July 4, 2025, Public Law 119-21, which we refer to as the
``Working Families Tax Cut'' (WFTC) legislation, was enacted. Section
71201 of the WFTC legislation amended title XVIII of the Social
Security Act (the Act) to add a new section 1899C, which provides that,
subject to section 1899C(b) of the Act, an individual may be entitled
to, or enrolled for, Medicare benefits only if the individual is in one
of the following four groups: (1) a citizen or national of the United
States; (2) an alien who is lawfully admitted for permanent residence
under the Immigration and Nationality Act (INA) (lawful permanent
resident or LPR); \187\ (3) an alien who has been granted the status of
Cuban and Haitian entrant (CHE); or (4) an individual who lawfully
resides in the United States \188\ in accordance with a Compact of Free
Association (COFA migrant).
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\187\ As defined in section 501(e) of the Refugee Education
Assistance Act of 1980 (Pub. L. 96-422).
\188\ See section 402(b)(2)(G) of the Personal Responsibility
and Work Opportunity Reconciliation Act of 1996 (PRWORA).
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Prior to enactment of the WFTC legislation, benefits payable under
the Medicare program for noncitizens generally depended on whether the
individual was ``lawfully present.'' Section 401 of the Personal
Responsibility and Work Opportunity Reconciliation Act of 1996 (PRWORA)
(Pub. L. 104-193, August 22, 1996), codified at 8 U.S.C. 1611,
generally provides that, subject to certain exceptions, only
``qualified aliens'' are eligible for Federal public benefits. However,
section 401(b)(3) of PRWORA provides that Medicare benefits under title
XVIII of the Act are not limited solely to ``qualified aliens,'' but
instead may be available to individuals who are lawfully present in the
United States. Section 401(b)(2) of PRWORA similarly provides that
noncitizens who are lawfully present in the United States may be
eligible for benefits payable under title II, such as Social Security
retirement or disability insurance benefits. Historically, before
paying Medicare or title II benefits, the Social Security
Administration (SSA) used a common process to verify an individual's
lawful presence status by determining whether the applicant was a U.S.
citizen or was otherwise lawfully present in the United States and
whether the individual resided in the United States. SSA maintains a
large set of policy and operational guidance, called Program Operations
Manual System (POMS), that CMS and SSA update as needed. The SSA's
procedures for verifying lawful presence before payment of title II and
Medicare benefits are delineated in POMS. Prior to the statutory
changes to Medicare eligibility made by the WFTC legislation, a
noncitizen could qualify for payment of Medicare benefits if they met
all other eligibility criteria and the individual was in an immigration
status or category considered lawfully present under 8 CFR 1.3(a),
which encompasses a broad range of immigration classifications. These
``lawfully present'' categories included:
An alien who is an LPR.\189\
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\189\ Under the Immigration and Nationality Act (INA) [8 U.S.C.
1101 et seq.].
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An alien who is granted asylum.\190\
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\190\ Under section 208 of INA [8 U.S.C. 1158].
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A refugee who is admitted to the United States.\191\
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\191\ Under section 207 of INA [8 U.S.C. 1157].
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An alien who is paroled into the United States for a
period of at least 1 year.\192\
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\192\ Under section 212(d)(5) of INA [8 U.S.C. 1182(d)(5)].
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An alien who is a Cuban and Haitian entrant.\193\
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\193\ As defined in section 501(e) of the Refugee Education
Assistance Act of 1980 (Pub. L. 96-422).
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An individual who lawfully resides in the United States
under a Compact of Free Association (COFA).\194\
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\194\ Public Law 99-239; Public Law 99-658; see also 8 U.S.C.
1612(b)(2)(G).
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The WFTC legislation did not modify the requirements for payment of
title II benefits under sections 202(y) and 223 of the Act. As such,
noncitizens who are lawfully present in the United States, as defined
by 8 CFR 1.3(a), may remain eligible for payment of title II benefits.
As a result, eligibility for payment of title II benefits is no longer
coextensive with eligibility for payment of Medicare benefits under
title XVIII of the Act for
[[Page 43998]]
certain noncitizens. Because continued reliance on the lawful presence
verification framework used to determine noncitizen eligibility for
payment of title II benefits would conflict with section 1899C of the
Act when applied to Medicare, we propose to establish Medicare-specific
definitions and related enrollment and termination criteria concerning
citizenship, nationality, and immigration status.
2. Limiting Coverage Under Medicare Part A and Part B to Certain
Individuals
a. Amending the Eligibility Criteria for Part A and Part B
Sections 226 and 226A of the Act establish the conditions under
which individuals are entitled to Medicare Part A benefits based on
attainment of age 65, disability, or end-stage renal disease (ESRD).
Individuals entitled to Medicare Part A under these provisions are not
required to pay premiums for such coverage (known herein as premium-
free Medicare Part A) and may elect to enroll in Medicare Part B. In
general, individuals entitled to title II retirement benefits prior to
attaining age 65 or entitled to title II disability benefits, upon
attainment of age 65 or after satisfying any applicable waiting period,
respectively, are automatically enrolled in premium-free Medicare Part
A and will be enrolled automatically in Medicare Part B unless they
decline Medicare Part B enrollment.\195\ There are no statutory
requirements for citizenship, nationality, immigration status, or
residency in sections 226 and 226A of the Act. Eligibility
determinations, including citizenship and lawful presence verification,
for premium-free Medicare Part A have historically been made through
the title II lawful presence verification framework administered by the
SSA.
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\195\ Section 1837 of the Act and the enrollment process
outlined in 42 CFR 407.17.
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Section 1818 of the Act establishes the conditions under which
certain individuals who are not entitled to premium-free Medicare Part
A may enroll in the hospital insurance program by paying a monthly
premium (herein referred to as premium Medicare Part A). Under section
1818 of the Act, an individual who has attained age 65, enrolled in
Medicare Part B, and is not otherwise entitled to premium-free Medicare
Part A may enroll if the individual is a resident of the United States
and is either a citizen of the United States or an alien lawfully
admitted for permanent residence who has resided continuously in the
United States for the 5 years immediately preceding the month in which
the individual applies for enrollment.
Section 1836 of the Act establishes eligibility requirements for
Medicare Part B (also known as supplementary medical insurance). Under
section 1836 of the Act, an individual may enroll in Medicare Part B if
the individual is entitled to Medicare Part A or, alternatively, has
attained age 65, is a resident of the United States and is either a
citizen of the United States or an alien lawfully admitted for
permanent residence who has resided continuously in the United States
for the 5 years immediately preceding the month in which the individual
applies for enrollment. The WFTC legislation did not eliminate the 5-
year continuous residency requirement for LPRs in sections 1818(a)(3)
and 1836(a)(2) of the Act and, as a result, we are not proposing to
alter this requirement. In other words, LPRs who meet the 5-year
continuous residency requirement and other applicable Medicare
requirements would maintain their Medicare benefit.
Similar to premium-free Medicare Part A, enrollment in Medicare
Part B under section 1836(a)(1) of the Act has historically been
administered in coordination with the SSA's lawful presence
verification framework for confirming citizenship, nationality, lawful
presence, and residency status for payment of title II benefits.
However, section 1899C of the Act establishes specific statutory
categories of individuals who may be entitled to, or enrolled in,
Medicare under title XVIII of the Act. As a result, title II's lawful
presence requirements no longer fully align with the Medicare Part B
eligibility framework established by section 1899C of the Act.
To align Medicare eligibility regulations with section 1899C of the
Act, we are proposing to add a new definition of ``eligible
noncitizen'' at 42 CFR 400.200 that includes the categories of
noncitizens eligible for Medicare under sections 1899C(a)(2) through
(4) of the Act. Specifically, the proposed definition would state that
an ``eligible noncitizen'' is an individual who is (1) an alien
lawfully admitted for permanent residence under the INA; (2) an alien
who has been granted the status of CHE, as defined in section 501(e) of
the Refugee Education Assistance Act of 1980 (Pub. L. 96-422); or (3)
an individual who lawfully resides in the United States in accordance
with a COFA referred to in 8 U.S.C. 1612(b)(2)(G).
The proposed definition of ``eligible noncitizen'' is not intended
to apply to noncitizen U.S. nationals who are expressly eligible for
Medicare under section 1899C(a)(1) of the Act. The proposed definition
of ``eligible noncitizen'' applicable to Medicare eligibility would be
distinguishable from the immigration status or category criteria in 8
CFR 1.3 applicable to noncitizen eligibility for title II benefits,
which continues to be based on the ``lawfully present'' framework in
section 401(b)(2) of PRWORA.
We further propose to amend regulations at 42 CFR part 406
(Medicare Part A) and 42 CFR part 407 (Medicare Part B) to incorporate
the proposed definition of ``eligible noncitizen.'' We propose to add
that, effective July 4, 2025, an individual must be a citizen or
national of the United States or an eligible noncitizen as a basis for
entitlement. These proposed changes would be added or included into the
following sections:
Premium-Free Medicare Part A:
++ New paragraph (a)(2) would be added to Sec. 406.5 (Basis of
eligibility and entitlement). This proposed new paragraph would add the
requirement that, in addition to satisfying the applicable age,
disability, or ESRD-based entitlement criteria, an individual must also
be a citizen or national of the United States or an eligible
noncitizen. This revision would align the eligibility and entitlement
criteria for premium-free Medicare Part A with section 1899C(a) of the
Act.
++ New paragraph (a)(2) would be added to Sec. 406.10 (Individual
age 65 or over who is entitled to Social Security or Railroad
Retirement benefits, or who is eligible for Social Security benefits).
This proposed new paragraph would clarify that individuals age 65 or
over who otherwise qualify for premium-free Part A through Social
Security or Railroad Retirement pathways must also satisfy the
citizenship, nationality, or immigration status or category
requirements established by section 1899C(a) of the Act. This would
ensure that automatic or application-based entitlement under this
section is limited to U.S. citizens, U.S. nationals, and eligible
noncitizens.
++ Paragraph (b)(2) would be revised in Sec. 406.11 (Individual
age 65 or over who is not eligible as a Social Security or Railroad
Retirement benefits beneficiary, or on the basis of government
employment). This proposed revision would align the eligibility
language in Sec. 406.11 with section 1899C(a) of the Act and clarify
that individuals qualifying under this pathway must also satisfy the
citizenship, nationality, or immigration status or category standards
in section 1899C(a) of the Act. This change would ensure that
entitlement is not available
[[Page 43999]]
under this section unless the individual is a U.S citizen, U.S.
national, or eligible noncitizen.
++ New paragraph (a)(2) would be added to Sec. 406.12 (Individual
under age 65 who is entitled to Social Security or Railroad Retirement
disability benefits). This proposed new paragraph would provide that
individuals under age 65 who otherwise qualify for premium-free Part A
on the basis of disability must also meet the citizenship, nationality,
or immigration status or category requirements of section 1899C(a) of
the Act. This would align the regulation implementing premium-free Part
A entitlement based on disability with the requirements in section
1899C(a) of the Act.
++ New paragraph (c)(4) would be added to Sec. 406.13 (Individual
who has ESRD). This proposed new paragraph would clarify that
individuals who otherwise qualify for premium-free Part A on the basis
of ESRD must also be a citizen or national of the United States or an
eligible noncitizen. This revision would align the regulation
implementing premium-free Part A entitlement based on ESRD with the
eligibility limitations in section 1899C(a) of the Act.
Premium Medicare Part A:
++ In Sec. 406.20 (Basic Requirements), paragraphs (b)(2)(i) and
(b)(2)(ii) would be revised and new paragraphs (b)(2)(iii), (b)(2)(iv),
and (c)(5) would be added. These proposed revisions would update the
eligibility requirements for enrollment in premium Part A to
incorporate the proposed definition of eligible noncitizen. These
changes would align premium Part A eligibility with section 1899C(a) of
the Act by clarifying that only U.S. citizens, U.S. nationals, and
eligible noncitizens may enroll under this pathway.
Medicare Part B:
++ New paragraphs (a)(2)(ii)(A) through (D) would be added in Sec.
407.10 (Eligibility to Enroll). These proposed revisions would update
the Part B enrollment regulation to incorporate the proposed definition
of eligible noncitizen. These proposed changes would align the Part B
eligibility regulation with section 1899C(a) of the Act and clarify
that only U.S. citizens, U.S. nationals, and eligible noncitizens may
enroll under this pathway.
We note that the WFTC legislation also has implications for the
Medicare Part B Immunosuppressive Drug benefit (Part B-ID) under
section 1836(b) of the Act. Part B-ID is a limited Part B benefit that
provides coverage only for immunosuppressive drugs for certain
individuals whose entitlement to Medicare based solely on end-stage
renal disease (ESRD) ended 36 months after a successful kidney
transplant and who do not have other disqualifying health coverage.
Although eligibility for Part B-ID is governed by the specific criteria
set forth in Sec. 407.55, individuals seeking to enroll in, or remain
enrolled in, Part B-ID must also satisfy the citizenship, nationality,
or immigration status or category requirements in section 1899C(a) of
the Act. Accordingly, we propose to revise Sec. 407.55 (Eligibility to
Enroll) to add new paragraphs (a)(1) and (2) to clarify that
eligibility for Part B-ID is also subject to the limitations
established by section 1899C(a) of the Act.
b. Termination of Entitlement for Individuals Who Were Entitled to, or
Enrolled for, Medicare as of July 4, 2025, in Accordance With Section
71201 of the WFTC Legislation (``Grace Period'' Population)
Due to the statutory changes to Medicare eligibility made by
section 71201 of the WFTC legislation, individuals who are not U.S.
citizens or U.S. nationals and who have an immigration status or
category other than LPR, CHE, or COFA migrant, and who were entitled
to, or enrolled for, Medicare as of July 4, 2025, will no longer be
eligible for Medicare on the date that is 18 months after July 4, 2025.
As shorthand, we are referring to this 18-month time period as the
``grace period'' and the applicable individuals identified and notified
during the grace period as the ``grace period population.'' Section
1899C(b)(2)(A) of the Act directs the SSA to complete a review of all
individuals entitled to, or enrolled for, Medicare as of July 4, 2025,
and identify those beneficiaries entitled to, or enrolled for, Medicare
as of July 4, 2025, who do not meet the requirements of section
1899C(a) of the Act. Section 1899C(b)(2)(A) provides 1 year for SSA to
complete this task for the grace period population. Section
1899C(b)(2)(B) of the Act directs the SSA to provide notice to such
beneficiaries as soon as practicable after identifying such
beneficiaries that their entitlement to, or enrollment in, Medicare
will be terminated as of the date that is 18 months after July 4, 2025.
The SSA shall identify all individuals who do not or potentially do
not meet one of the eligibility criteria in section 1899C(a) per
section 1899C(b)(2) of the Act. In accordance with section
1899C(b)(2)(B) of the Act, upon identifying individuals who do not or
potentially do not meet one of the eligibility criteria in section
1899C(a), the SSA will then send, as soon as practicable, a notice to
these identified individuals. The notice will inform them that SSA
records indicate that they do not meet one of the eligibility criteria
in section 1899C(a) of the Act, and their Medicare entitlement and
enrollment will be terminated if they cannot provide evidence proving
eligibility. Individuals would be instructed to contact the SSA if they
believe the information is incorrect and to provide updated evidence of
eligibility before their entitlement and enrollment is terminated. If
applicable, the notice would state that a formal initial determination
of ineligibility will be sent prior to their termination date if the
individual takes no action to update their records or if the individual
confirms that they do not meet the eligibility criteria in section
1899C(a) of the Act. As proposed, the SSA would provide a termination
notice towards the end of December 2026 to all identified individuals
determined to be ineligible based on data available to the SSA.. The
termination notice would explain that the identified individuals do not
satisfy the requirements in section 1899C(a) of the Act and therefore
are not entitled to, and may not be enrolled for, Medicare. The notice
would state that termination of enrollment will be effective February
1, 2027. The notice would inform individuals of their appeal rights
under existing appeals regulations for initial determinations
delineated in 42 CFR, part 405, subpart I. Specifically, 42 CFR
405.900(b)(1) establishes that appeals of initial determinations for
entitlement to benefits under Part A or Part B of Medicare are
administered in accordance with the SSA's regulations governing
reconsiderations of these initial determinations at 20 CFR, part 404,
subpart J.
We note that entitlement to premium-free Part A and enrollment in
premium Part A and Part B are referenced in the Act as ``monthly
insurance benefits'' or ``benefits for a month'' (see section 226(c)(1)
and (2) of the Act) and entitlement to or enrollment in Medicare always
begins on the first day of the month and always ends on the last day of
the month (see section 1838(a) and (b) of the Act). Consequently, the
termination in proposed Sec. Sec. 406.14(d)(2), 406.28(g)(3)(ii), and
407.27(e)(3)(ii) would be at the end of the calendar month.
Accordingly, we propose to amend the following regulations to
implement termination procedures for individuals who were entitled to,
or enrolled for, Medicare as of July 4, 2025, but do not meet or
potentially do not meet the
[[Page 44000]]
eligibility requirements of section 1899C(a) of the Act:
Premium-Free Medicare Part A:
++ New Sec. 406.14 (End of Entitlement Due to Change in
Citizenship, Nationality, or Immigration Status or Category) would be
added, in accordance with section 1899C(b)(1) of the Act, to establish
the termination framework for individuals who were entitled to,
premium-free Part A as of July 4, 2025, but who either do not meet or
potentially do not meet the eligibility requirements of section
1899C(a) of the Act. Specifically, new paragraph (b) would provide that
individuals entitled or enrolled as of July 4, 2025, who either do not
meet or potentially do not meet the requirements of Sec. 406.5(a)(2)
will be identified and notified by the SSA per section 1899C(b)(2) of
the Act. Individuals not meeting Sec. 406.5(a)(2) requirements will
have their entitlement or enrollment terminated in accordance with
paragraph (d).
++ New paragraph (b)(3) would be added to Sec. 406.10 (Individual
age 65 or over who is entitled to Social Security or Railroad
Retirement benefits, or who is eligible for Social Security benefits)
to add a cross reference to the termination provision in the new Sec.
406.14.
++ New paragraph (d)(2)(v) would be added to Sec. 406.12
(Individual under age 65 who is entitled to Social Security or Railroad
Retirement disability benefits) to add a cross reference to the
termination provision in the new Sec. 406.14.
++ New paragraph (f)(3) would be added to Sec. 406.13 (Individual
who has end-stage renal disease) to add cross reference to the
termination provision in the new Sec. 406.14(b).
Premium Medicare Part A:
++ New paragraph (g)(1) would be added to Sec. 406.28 (End of
Entitlement Due to Change in Citizenship, Nationality, or Immigration
Status or Category) in accordance with section 1899C(b)(1) of the Act,
to establish the termination framework for individuals who were
entitled to, or enrolled for, premium Part A as of July 4, 2025, but
who either do not meet or potentially do not meet the eligibility
requirements of section 1899C(a) of the Act. Specifically, the new
paragraph (g)(1) would provide that individuals entitled to or enrolled
as of July 4, 2025, who either do not meet or potentially do not meet
the requirements of Sec. 406.20(b)(2) will be identified and notified
by the SSA per section 1899C(b)(2) of the Act. Individuals not meeting
Sec. 406.20(b)(2) requirements will have their entitlement or
enrollment terminated in accordance with subparagraph (3).
Medicare Part B:
++ New paragraph (e)(1) would be added to Sec. 407.27 (Termination
of entitlement: Individual), in accordance with section 1899C(b)(1) of
the Act, to establish the termination framework for individuals who
were enrolled in Part B as of July 4, 2025, but who either do not meet
or potentially do not meet the eligibility requirements of section
1899C(a) of the Act. Specifically, the new paragraph (e)(1) would
provide that individuals enrolled as of July 4, 2025, who either do not
meet or potentially do not meet the requirements of Sec. 407.10(a)(2)
will be identified and notified by the SSA per section 1899C(b)(2) of
the Act. Individuals not meeting Sec. 407.10(a)(2) requirements will
have their enrollment terminated in accordance with paragraph (3).
c. Proposed Termination Process for Certain Noncitizens Entitled to, or
Enrolled for, Medicare Who Were Not Identified and Notified by the SSA
per Section 1899C(b)(2) of the Act (Outside of the ``Grace Period''
Population)
We turn now to the proposed termination processes that would be
used for all other individuals whose eligibility for Medicare,
including both initial eligibility and continued eligibility, is
impacted by the statutory changes to Medicare eligibility made by
section 71201 of the WFTC legislation and whose entitlement and
enrollment was not terminated by the SSA under the processes
implementing section 1899C(b) of the Act. The proposed termination
processes for this population provides the framework to terminate
enrollment in Medicare if they are not eligible to be entitled or
enrolled per section 1899C of the Act while ensuring all impacted
individuals are notified of termination and retain their appeal rights.
Under this proposal, all terminations made under section 1899C of the
Act would be prospective.
We propose that entitlement and enrollment for those not identified
during the grace period and found not to meet the citizenship,
nationality, or immigration status or category requirements in section
1899C(a) of the Act would end according to the termination processes in
the following proposals: Sec. 406.14(c) and (d) for those with
premium-free Part A, Sec. 406.28(g)(2) and (3) for those with premium
Part A, and Sec. 407.27(e)(2) and (3) for those with Part B benefits.
The proposed termination processes in Sec. Sec. 406.14(d),
406.28(g)(3) and 407.27(e)(3) include providing notice to such
individuals that their entitlement and enrollment for Medicare will be
terminated if they do not meet section 1899C(a) of the Act, and for
terminating entitlement or enrollment where the SSA determines that the
individual either does not or no longer meets the requirements of
section 1899C(a) of the Act.
As stated, this proposed termination process would apply to anyone
enrolled in Medicare whom the SSA determines does not meet eligibility
requirements under section 1899C(a) of the Act and was not part of the
grace period population per section 1899C(b)(2)(B) of the Act. There is
a period of time between enactment of the WFTC legislation on July 4,
2025, and the SSA starting to screen individuals for new Medicare
enrollment under the criteria in section 1899C(a) of the Act, which is
expected in 2026. Individuals enrolled after enactment of the WFTC
legislation but before screening procedures are implemented do not fall
into the grace period population because they were not enrolled as of
the date of enactment. Thus, individuals enrolled during the previously
discussed time period who do not meet the eligibility requirements in
section 1899C(a) of the Act would be terminated according to proposed
Sec. Sec. 406.14(d), 406.28(g)(3) or 407.27(e)(3), as appropriate.
Additionally, the proposed termination process would apply to
anyone enrolled in Medicare whom the SSA determines does not meet the
eligibility requirements in section 1899C(a) of the Act and was not
notified as part of the grace period population per section
1899C(b)(2)(B) of the Act. This would include individuals whose status
changed prior to the implementation of this proposed rule, if finalized
as proposed, such as an individual who was enrolled in Medicare in
October 2024 and met the eligibility requirements under section
1899C(a) of the Act based on their conditional LPR status when SSA
identified and notified the grace period population. Therefore, they
were not included in the grace period population per section
1899C(b)(2)(B) of the Act. However, if SSA's records indicate that
their conditional LPR status expires December 2026, this proposed
termination process would apply upon expiration of their conditional
LPR status and would provide the framework for this individual's
Medicare enrollment to be terminated as they would no longer satisfy
the requirements of section 1899C(a) of the Act. We emphasize that the
same process would also apply to individuals enrolled after this
proposed rule is implemented, if finalized as proposed. As an example,
consider the case of an individual enrolled in Medicare with
conditional LPR status whose enrollment began in April 2028. In
[[Page 44001]]
February 2030, SSA records indicate that the individual's conditional
LPR status expires in April 2030. Upon expiration of the individual's
conditional LPR status in April 2030, the individual would no longer
satisfy the requirements of section 1899C(a) of the Act, and the SSA
would send notice to the individual that they no longer meet the
requirements of section 1899C(a) of the Act. As a result, under the
proposed process for termination of enrollment, the individual's
Medicare enrollment would be terminated at the end of the month
following the month in which the notice is dated.
There are several circumstances in which individuals are identified
as no longer meeting the requirements of section 1899C(a) of the Act
outside the grace period. We propose the same termination process for
individuals in these circumstances in proposed Sec. Sec. 406.14(d),
406.28(g)(3) or 407.27(e)(3), as appropriate.
For these individuals outside the grace period, we propose that a
termination notice from the SSA would be sent to each individual
identified as ineligible. We propose the notice would explain that, per
data available to the SSA, the individual does not satisfy the
requirements of section 1899C(a) of the Act. Under the proposed
termination process, an individual would not lose Medicare entitlement
or enrollment during the month in which the SSA determines that the
individual does not or no longer meets the requirements of section
1899C(a) of the Act. Rather, Medicare entitlement or enrollment would
terminate at the end of the month following the month in which the
notice is dated. For example, if the date of the termination notice is
in March 2027, termination would be effective at the end of April 2027.
This proposed termination timeline would be explained in the notice.
The SSA will not terminate anyone's entitlement or enrollment prior to
notification. Further, no termination of Medicare would occur for any
individual entitled to, or enrolled for, Medicare for failure to meet
the requirements of section 1899C(a) of the Act prior to the effective
date of this rule, if finalized as proposed. We propose an effective
date of January 1, 2027.
We propose that individuals whose Medicare entitlement and
enrollment are terminated because they do not meet the requirements of
section 1899C(a) of the Act would be provided appeal rights under the
CMS' existing appeals regulations for initial determinations. Appeals
of initial determinations for entitlement to benefits under Medicare
Part A or Part B are administered in accordance with 20 CFR, part 404,
subpart J. See 42 CFR 405.900(b)(1). We propose to include the
information about appeal rights in the proposed termination notices.
Under this proposal, termination notices would be sent to affected
individuals on an ongoing basis, as applicable, when the SSA receives
information that an individual enrolled in Medicare does not meet the
requirements of section 1899C(a) of the Act.
These proposals are necessary to ensure implementation of section
1899C of the Act is consistent with the efficient administration of the
Medicare program under section 1102(a) of the Act. Therefore, to
implement the proposed termination framework, we propose adding and
revising the following sections:
Premium-Free Medicare Part A:
++ New Sec. 406.14 (End of entitlement due to change in
citizenship, nationality, or immigration status or category) would be
added. The proposed new Sec. 406.14(c) would provide the termination
framework for individuals entitled to premium-free Part A who were not
identified and notified by the SSA per section 1899C(b)(2) of the Act
and were subsequently determined by the SSA as not meeting the
requirements of Sec. 406.5(a)(2). Proposed Sec. 406.14(d) describes
the proposed termination notice and appeal rights in accordance with
existing regulations governing Medicare entitlement determinations,
states the effective date of premium-free Part A entitlement
termination, and states that the individual should contact the SSA if
their citizenship, nationality, or immigration status or category
changes such that they may be entitled to, or enrolled for, premium-
free Part A benefits.
++ New paragraph (b)(3) would be added to Sec. 406.10 (Individual
age 65 or over who is entitled to Social Security or Railroad
Retirement benefits, or who is eligible for Social Security benefits).
This proposed new paragraph would add a cross-reference to Sec. 406.14
so that individuals entitled to, or enrolled for, premium-free Part A
through the age-65 pathway would be subject to the termination
procedures in that section if they do not or no longer meet the
citizenship, nationality, or immigration status or category
requirements in section 1899C(a) of the Act.
++ New proposed paragraph (d)(2)(v) would be added to Sec. 406.12
(Individual under age 65 who is entitled to Social Security or Railroad
Retirement disability benefits). This proposed new paragraph would add
cross-references to Sec. 406.14(b) and (c) so that disability-based
premium-free Part A entitlement would be subject to the proposed
termination procedures for an individual who does not or no longer
meets the citizenship, nationality, or immigration status or category
requirements in section 1899C(a) of the Act.
++ New proposed paragraph (f)(3) would be added to Sec. 406.13
(Individual who has ESRD). This proposed new paragraph would add a
cross-reference to Sec. 406.14 to specify that individuals entitled
to, or enrolled for, premium-free Part A on the basis of ESRD would be
subject to the proposed procedures for termination when an individual
does not or no longer meets the citizenship, nationality, or
immigration status or category requirements in section 1899C(a) of the
Act.
Premium Medicare Part A:
++ New proposed paragraph (g)(2) would be added to Sec. 406.28
(End of entitlement) for individuals who were entitled to, or enrolled
for, premium Part A, who were not identified and notified by the SSA
per section 1899C(b)(2) of the Act and were subsequently determined by
the SSA as not meeting the requirements of Sec. 406.20(b)(2). Under
proposed paragraph (g)(2), entitlement would end as provided under
paragraph (g)(3) of this section.
++ New proposed paragraph (g)(3) would be added to Sec. 406.28
(End of entitlement). It describes the proposed termination notice,
which would specify the individual's appeal rights in accordance with
existing regulations governing Medicare entitlement determinations,
state the effective date of premium Part A enrollment termination, and
state that the individual should contact the SSA if their citizenship,
nationality, or immigration status or category changes such that they
may be entitled to, or enrolled for, premium Part A benefits.
++ Paragraphs (a) and (b) of Sec. 406.50 would be revised to
change the word ``alien'' to ``eligible noncitizen.''
Medicare Part B:
++ New proposed paragraph (e)(2) would be added to Sec. 407.27
(Termination of entitlement: Individual enrollment). This new paragraph
would specify that individuals who are enrolled in Part B, who were not
identified and notified by the SSA per section 1899C(b)(2) of the Act
and were subsequently determined by the SSA as not meeting the
requirements of Sec. 407.10(a)(2), would have their enrollment
terminated under the new proposed paragraph (e)(3) of the section.
[[Page 44002]]
++ New proposed paragraph (e)(3) would be added to Sec. 407.27
(Termination of entitlement: Individual enrollment). This new paragraph
would describe the termination notice, which would specify the
individual's appeal rights in accordance with existing regulations
governing Medicare entitlement determinations, state the effective date
of Part B enrollment termination, and state that the individual should
contact the SSA if their citizenship, nationality, immigration status
or category changes such that they may be enrolled for, Part B
benefits.
3. Enrollment Pathway for Individuals Who Gain or Regain Eligibility
Section 1899C of the Act limits eligibility for Medicare to
specified categories of individuals based on citizenship, nationality,
or immigration status or category. As a result, except as provided in
section 1899C(b) of the Act, no individual may be entitled to, or
enrolled for, Medicare if the individual does not meet the requirements
of section 1899C(a) of the Act. Conversely, individuals may later
become eligible if their citizenship, nationality, or immigration
status or category changes, such that they satisfy section 1899C(a) of
the Act, as well as applicable Medicare eligibility requirements.
To address circumstances in which individuals who initially did not
meet the eligibility requirements of section 1899C(a) of the Act at the
time they met all other Medicare eligibility requirements but,
subsequently, do meet the section 1899C(a) of the Act requirements, we
propose to establish a special enrollment period (SEP) under Sec. Sec.
406.27(f) and 407.23(f). The SEP would also apply to those individuals
whose Medicare entitlement or enrollment is terminated because they do
not or no longer meet the requirements in section 1899C(a) of the Act,
but who subsequently experience a change such that they meet the
requirements of section 1899C(a) of the Act. Establishing an SEP for
these scenarios is within the Secretary's authority under sections
1837(m) and 1838(g) of the Act, which provide for the establishment of
SEPs for exceptional conditions. We consider the enactment of the WFTC
legislation and addition of section 1899C of the Act to constitute an
exceptional condition because it created a new and narrower class of
noncitizens who may be eligible for Medicare than are eligible for
title II benefits, despite the close associations between title II
entitlement and Medicare entitlement, as discussed in section F.1. of
this preamble, and despite the fact that lawful presence has been the
standard for noncitizen eligibility for both title II and Medicare
benefits for decades. In addition, the statutory changes made by the
WFTC legislation fundamentally altered the consequences of changes in
immigration status. Prior to enactment of the WFTC legislation,
noncitizens enrolled in Medicare who had a loss of lawful presence
status would have remained enrolled in Medicare, but payment for
benefits would have been suspended. Now, in accordance with section
1899C of the Act, an individual who no longer meets the requirements of
section 1899C(a) of the Act must have their entitlement and enrollment
terminated. If such an individual later meets the requirements of
section 1899C(a) of the Act, it may be at a time that does not clearly
fall within an established enrollment period. In addition, individuals
who otherwise meet the eligibility requirements for Medicare but for
the eligibility requirements of section 1899C(a) of the Act may gain
eligibility at a time that does not clearly fall within an established
enrollment period. For this proposed SEP, we also propose that the
general rule in Sec. Sec. 406.27(a) and 407.23(a) that an individual
must have missed an enrollment period due to the exceptional condition
would not apply. We believe this is necessary because, for example, as
explained below, the 7-month initial enrollment period under sections
1818(c)(1) and 1837(d) of the Act does not align well with the
unpredictable nature as to when an individual may experience a change
in citizenship, nationality, or immigration status or category, such
that they would meet the requirements of section 1899C(a) of the Act.
As another example, an individual may lose and subsequently regain
eligibility under section 1899C(a) of the Act during a period that does
not overlap with an otherwise available enrollment period, such that no
enrollment period is actually missed. Accordingly, this SEP would be
available to individuals who later meet, or again meet, the
requirements of section 1899C(a) of the Act, regardless of whether an
enrollment period was missed.
We propose that the special enrollment period would begin in the
month in which the individual, upon contacting the SSA, provides
sufficient documentation to establish eligibility, and the proposed
special enrollment period would end 6 months later. The duration of
this proposed special enrollment period would be the same time frame
afforded to individuals granted a special enrollment period for
exceptional conditions under Sec. Sec. 406.27 and 407.23. We propose
that entitlement and enrollment would be prospective for premium Part A
and Part B, beginning with the first day of the month following the
month of enrollment. We believe a prospective effective date is
appropriate and consistent with the Secretary's authority under section
1818(c)(8) of the Act for premium Part A and section 1838(g) of the Act
for Part B to establish the date on which coverage begins for
individuals enrolling during an SEP, in a manner consistent, to the
extent practicable, with protecting continuity of health benefit
coverage. Although an individual may in some cases be able to
demonstrate an earlier date on which the requirements of section
1899C(a) of the Act were met, we are proposing a uniform prospective
effective date for premium Part A and Part B because citizenship data
in SSA records is gathered and verified at a point in time. o and does
not provide a reliable or administrable basis for consistently
establishing earlier eligibility dates for enrollment purposes. In
addition, a retroactive effective date for premium Part A and Part B
could require the assessment of back-due premiums for months of
coverage that the individual had not yet affirmatively elected, which
would add operational complexity and could create unexpected financial
obligations for beneficiaries. We believe a prospective-only approach
is therefore the most practicable and administrable method for
implementing this SEP for premium Part A and Part B.
We considered an alternative pathway which consisted of
establishing an initial enrollment period for premium Part A and Part B
for eligible noncitizens who would have been eligible for Medicare
based on entitlement to benefits under title II of the Act and
attainment of age 65 or completion of the 24-month waiting period for
disability benefits, as applicable, but whose entitlement was never
effectuated because they did not meet the citizenship, nationality, or
immigration status or category requirements specified in section
1899C(a) of the Act. However, we note that the 7-month initial
enrollment period articulated in sections 1818(c)(1) and 1837(d) of the
Act is largely tied to the attainment of age 65 or completion of the
24-month waiting period for disability benefits and begins on the first
day of the third month before the month in which an individual meets
the eligibility requirements for premium Part A and Part B.
Traditionally, this 3-
[[Page 44003]]
month pre-eligibility period provides an opportunity for individuals to
explore coverage options (for example, original Medicare or Medicare
Advantage) and enroll in Part A and Part B. This 3-month period helps
individuals avoid delays and gaps in coverage. As a practical matter,
such an initial enrollment period could not be applied in an analogous
manner to changes that would make an individual eligible for Medicare
by virtue of meeting the requirements of section 1899C(a) of the Act
because an individual may not be enrolled for Medicare benefits unless
and until they meet the requirements of section 1899C(a) of the Act. As
a result, establishing an initial enrollment period under sections
1818(c)(2) and 1837(d) of the Act or these individuals would
effectively shorten the enrollment period by 3 months because such
individuals could not be enrolled in Medicare until the section
1899C(a) of the Act requirements are met, which would conflict with the
requirements of the Act. Instead, we opted for a proposed approach of
establishing a SEP for individuals enrolling in Medicare for the first
time, as well as individuals who lost and regained Medicare, due to
changes in citizenship, nationality, or immigration status or category
because it comports with the requirements of the Act.
For premium-free Medicare Part A, we propose that entitlement may
be retroactive for up to 6 months, but not earlier than the first month
in which the individual met all the eligibility requirements in
proposed Sec. 406.5(a). Under this proposal, if acceptable evidence
establishes the month in which the individual first satisfied the
citizenship, nationality, or immigration status or category
requirements in Sec. 406.5(a)(2), the SSA would use that month,
subject to the applicable retroactivity limit. If the earliest month of
eligibility cannot be established based on acceptable documentary
evidence, entitlement would instead begin on the first day of the month
in which the SSA verifies that the individual satisfies Sec.
406.5(a)(2).
Accordingly, to implement the enrollment processes described
earlier for individuals who establish or reestablish eligibility under
section 1899C(a) of the Act, we propose to amend the regulations at 42
CFR part 406 (Medicare Part A) and 42 CFR part 407 (Medicare Part B) to
specify the availability, duration, and effective date rules for
enrollment under these circumstances. We propose to add and revise the
following sections:
Premium-Free Medicare Part A:
++ Paragraph (b) would be revised in Sec. 406.6 (Application or
enrollment for hospital insurance) to include the citizenship,
nationality, or immigration status or category requirements in section
1899C(a) of the Act for individuals who need not file an application
for hospital insurance.
++ New paragraph (f) would be added to Sec. 406.6 (Application or
enrollment for hospital insurance) to establish rules for individuals
who would otherwise qualify for premium-free Part A based on
entitlement to title II benefits, but who were not entitled because
they did not meet the citizenship, nationality, or immigration status
or category requirements in section 1899C(a) of the Act at the time
they otherwise would have become eligible. It would also specify how
such individuals may initiate entitlement upon later meeting those
requirements and clarify the applicable entitlement effective date,
including the circumstances under which premium-free Part A entitlement
would begin consistent with current law. Subparagraph (1) applies to
those who meet the conditions of paragraph (b) of this section and, as
such, need not file an application for hospital insurance. These
individuals must contact the SSA to initiate entitlement to hospital
insurance. Subparagraph (2) applies to those who meet the conditions of
paragraph (c) of this section and, as such, must file an application
for hospital insurance. These individuals must contact the SSA to file
such application.
Premium Medicare Part A:
++ Paragraph (f) would be redesignated as paragraph (g) and new
paragraph (f) would be added to Sec. 406.27 (Special enrollment
periods for exceptional conditions). This new paragraph would establish
an SEP for individuals whose premium Part A enrollment was previously
terminated because they lost the citizenship, nationality, or
immigration status or category required under section 1899C(a) of the
Act, but who later regain a qualifying status and again become
eligible. The SEP would also apply to individuals who would otherwise
meet the eligibility requirements for Medicare, except for those in
section 1899C(a) of the Act, and later meet the eligibility
requirements of section 1899C(a) of the Act. The new provision would
specify the availability and duration of this SEP and clarify that
enrollment under this pathway would be prospective, consistent with the
Secretary's authority to establish SEPs for exceptional conditions. An
individual does not need to miss an applicable enrollment period to be
eligible for this SEP.
Medicare Part B:
++ Paragraph (f) would be redesignated as paragraph (g) and new
paragraph (f) would be added to Sec. 407.23 (Special enrollment
periods for exceptional conditions). This new paragraph would establish
a SEP for individuals whose Part B enrollment was terminated because
they no longer met the citizenship, nationality, or immigration status
or category requirements in section 1899C(a) of the Act, but who
subsequently regain a qualifying status and again become eligible to
enroll. The SEP would also apply to individuals who otherwise met the
eligibility requirements for Medicare, except for those in section
1899C(a) of the Act, and later meet the eligibility requirements of
section 1899C(a) of the Act. It would specify the duration of the SEP
and the prospective effective date of Part B coverage for individuals
enrolling under this pathway. An individual does not need to miss an
applicable enrollment period to be eligible for this SEP.
4. Limiting Coverage Under Medicare Part C, Medicare Part D, and Cost
Plans to Certain Individuals
Under section 1851(a)(3) of the Act, Medicare Part C (Medicare
Advantage (MA)) is available only to individuals who are entitled to
Medicare Part A and are enrolled in Medicare Part B. Medicare Part D
(the Medicare prescription drug benefit) is available to individuals
who are entitled to Medicare Part A or are enrolled in Medicare Part B,
as specified in section 1860D-1(a)(3) of the Act. Section 1876(a)(1)(A)
of the Act outlines eligibility requirements to enroll in Medicare cost
plans and provides that individuals may enroll in cost plans if they
are entitled to Medicare Part A and are enrolled in Part B or are
enrolled in Part B only. Eligibility for enrollment in an MA plan, Part
D plan, or cost plan is therefore dependent on an individual's
underlying entitlement to and/or enrollment in Medicare Part A and/or
Part B, as applicable. Prior to the enactment of section 1899C of the
Act, individuals who satisfied the statutory conditions for Medicare
Part A entitlement and/or Medicare Part B enrollment, as applicable,
were likewise eligible to enroll in MA plans, Part D plans, or cost
plans, provided they met applicable enrollment requirements. The
eligibility requirements in section 1899C of the Act apply to all parts
of Medicare. Individuals who do not meet the eligibility requirements
of section 1899C of the Act are not eligible for
[[Page 44004]]
Medicare Part A or Part B and may not enroll or remain enrolled in MA
plans, Part D plans, or cost plans.
Individuals enrolled in MA plans, Part D plans, or cost plans who
do not meet the eligibility requirements of section 1899C of the Act
must be disenrolled from those plans. Under 42 CFR 417.460(b)(2)(iii),
422.74(b)(2)(ii), and 423.44(b)(2)(ii), individuals who lose
eligibility for enrollment are involuntarily disenrolled from the plan.
Such disenrollments will be prospective and effective the first day of
the calendar month following the last month of entitlement to Part A or
Part B as specified under 42 CFR 417.460(h), 422.74(d)(5), and
423.44(d)(3).
Plans do not process these disenrollments. CMS processes these
automatically through the MARx system when the SSA provides updated
eligibility and entitlement records and CMS will notify the plan of the
disenrollment due to loss of entitlement, through MARx transaction
reply codes. Plans have the option, but are not required, to provide a
notice of disenrollment due to loss of entitlement. Since the SSA
provides a loss of entitlement notice for Part A and Part B, there is
no need to require plans to provide additional notification.
Accordingly, we propose to amend the regulations at 42 CFR part
417, part 422, and part 423 to incorporate the new eligibility
limitations established by section 1899C of the Act. We propose to
revise the following sections to reflect the applicability of section
1899C of the Act:
Paragraph (b) of Sec. 417.2 (Basis and scope): We propose
to amend paragraph (b) of Sec. 417.2 to add a reference to section
1899C of the Act, which establishes eligibility limitations applicable
to cost plan enrollment.
Paragraphs (a)(1)(xii) and (a)(2) of Sec. 422.1 (Basis
and scope): We propose to amend Sec. 422.1 to add paragraph
(a)(1)(xii) to reference section 1899C of the Act, which establishes
eligibility limitations applicable to MA enrollment. We further propose
to remove and reserve paragraph (a)(2) that references 8 U.S.C. 1611.
Paragraphs (a)(1) and (3) of Sec. 423.1 (Basis and
scope): We propose to amend paragraph (a)(1) of Sec. 423.1 to add a
reference to section 1899C of the Act, which establishes eligibility
limitations applicable to Part D enrollment. We further propose to
remove and reserve paragraph (a)(3) of Sec. 423.1 that references 8
U.S.C. 1611.
We are also proposing to add that effective July 4, 2025, an
individual must be a citizen or national of the United States or an
eligible noncitizen as a basis for entitlement. We propose to revise
the following sections to add this language:
Paragraph (h) of Sec. 417.422 (Eligibility to enroll in
an HMO or CMP).
Paragraph (a)(7) of Sec. 422.50 (Eligibility to elect an
MA plan).
Paragraph (a)(1)(iii) of Sec. 423.30 (Eligibility and
enrollment).
Additionally, we propose to update the regulations at 42 CFR part
417, part 422 and part 423 to clarify the circumstances under which
individuals must be disenrolled from MA plans, Part D plans, or cost
plans due to failure to meet the eligibility requirements of section
1899C of the Act. Though failure to meet the eligibility requirements
of section 1899C of the Act results in a loss of Part A and Part B
eligibility, we propose to create an involuntary disenrollment process
for MA plans, Part D plans, and cost plans that is separate from the
existing loss of entitlement to Part A or Part B disenrollment process.
Administratively, separating failure to meet section 1899C of the Act
eligibility requirements from all other reasons for loss of Part A or
Part B entitlement allows CMS to better track the impact of this
provision and create new technical processes with the SSA and
internally. Specifically, we propose to revise the following sections
to add this language: