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It’s Here: CMS’ 2019 Proposed Physician Fee Schedule Rule

By Blair Burnett, Senior Policy Analyst, <em>ACCC</em>

July 17, 2018
Calculator on money with healthcare written on it

Summer in Washington, D.C., has always had a strong correlation to heated political activity. As the temperatures climb this month, proposed policies to reform the way the Centers for Medicare & Medicaid Services (CMS) pays providers for drugs and services are heating up as well. On July 12, 2018, CMS released its CY 2019 proposed Physician Fee Schedule rule, putting forward some significant proposals to reduce reimbursement for new Medicare Part B drugs, which could negatively impact patient access to newer anti-cancer therapies, and to streamline payment for E&M codes, which will hurt specialty care. Some good news from the rule includes two new payment codes for physician services delivered using telemedicine and proposed changes for year three of the Quality Payment Program.

While ACCC staff continue to analyze the proposed PFS rule, below are top-line takeaways that we think will be most important for ACCC members and their patients:  

  • The CY 2019 proposed rule sets the agency’s conversion factor, used to calculate CMS payment rates, at $36.05 – up $0.06 from the 2018 rate of $35.99. CMS estimates that the overall impact on hematology/oncology in 2019 will be a -4 percent reduction in reimbursement, and -2 percent for radiation/oncology.


  • No proposed changes to site-neutral payments. The agency proposes to continue to reimburse non-excepted provider-based departments at 40 percent of the outpatient payment rate. 


  • CMS proposes to reduce payment for new Medicare Part B drugs from Wholesale Acquisition Cost (WAC) plus 6 percent to WAC plus 3 percent, until Average Sales Price (ASP) data is available. This proposed rule would not affect Part B drugs where ASP data has already been made available. ACCC is very concerned about the impact this proposal will have on access to new therapies for cancer patients.


  • CMS is proposing some big changes to Evaluation & Management (E/M) codes. For 2019, the agency proposes to assign a single blended rate to levels 2 - 5, so levels 2 and 3 would see an increase in payment but level 4 and 5 visits would see a reduction. CMS Administrator Seema Verma estimates that some physicians could see a 1 to 2 percent reimbursement reduction with this proposed change. ACCC is very concerned that this approach devalues the complexity of cancer care and will result in lower reimbursement for specialists.


  • For 2019, the agency proposes to expand reimbursement for telehealth services. In brief, CMS seeks to establish new payment codes for two virtual services: telephone "check-ins" between clinicians and beneficiaries, and remote evaluation of photos or videos that a patient sends to a clinician. 

  • Within this year’s proposed PFS rule, CMS also includes changes to the CY 2019 Quality Program Program (QPP). The agency proposes to increase the cost category weight in the Merit-based Incentive Payment System (MIPS) to 15 percent (up from 10 percent in 2018) while lowering the quality category weight to 45 percent (down from 50 percent in 2018). CMS also proposes to add 10 new quality measures and remove 34 quality measures from MIPS. 


  • For year three of the QPP, CMS proposes to incentivize increased interoperability in MIPS, changing the "Advancing Care Information" category to "Promoting Interoperability" and aligning the category requirements with those of the Promoting Interoperability Program proposed in the CY 2019 Inpatient Prospective Payment System (IPPS) rule. Read ACCC's comments to the IPPS proposed rule here.
  • CMS proposes to reduce the level of physician supervision required for services provided by radiologist assistants

ACCC will host a webinar for members on the proposed CY 2019 PFS and OPPS rules in August – stay tuned for more information. ACCC will be submitting comments to the proposed rules and encourages our members to do the same.

Public comments are due on Monday, September 10.

ACCC members are encouraged to contact the ACCC policy team with any questions or concerns.