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February 1, 2022

New Year, New Fee Schedule: Important Changes for 2022

February 1, 2022

It’s that time again. Much like taxes or jury duty, there is a certain inevitability to the Centers for Medicaid & Medicare Services updating their Medicare Physician Fee Schedule (MPFS). Calendar year 2022 is no different, and the update contains both good and bad news. All the CMS’ efforts in updating the MPFS are “to drive innovation to support health equity and high quality, person-centered care,” according to this press release. Most of the changes this year have been in response to adjustments in practice necessitated by COVID-19. 

Let’s take a look at the main points of the 2022 MPFS and how they will affect your anesthesiology practice in the upcoming year. 

Changes to Payment Rates

We have good news and bad news. The bad news is a slight reduction in the conversion factor (CF) for physicians and anesthesia providers. The good news is the reduction is not as big as previously announced. The 2022 national anesthesia conversion factor will be $21.5623 rather than the previously stated $20.9343. Not only was the conversion factor cut, but this decision came with some easing of the 2% sequestration cut and elimination of the 4% PAYGO cut. 

This legislatively mandated adjustment comes on the heels of the expiration of the 3.75% payment increase provided by the 2021 Consolidated Appropriations Act (CAA). According to the CMS, “The PFS conversion factor reflects the statutory update of zero percent and the adjustment necessary to account for changes in relative value units and expenditures that would result from our finalized policies.” This was an anticipated decrease, and the ASA is working toward obtaining congressional relief.  

Learn more about other provisions in the Consolidated Appropriations Act (CAA) here.

Changes to Code Levels

The PFS Update also finalizes base unit values for six new anesthesia codes and increases the base unit value for code 00537. If you don’t want to search through the full documentation, here’s a handy Physician Fee Schedule Lookup Tool. In addition to these code changes, most of which represent an increase in base unit values, CMS also outlines activities that count when determining time, most of which don’t involve direct patient contact. Remember to record your time for the following activities: reviewing patient tests and history, performing an examination or evaluation, counseling patient’s family or caregiver, ordering tests, procedures, and medications, documenting clinical information, communicating with other health professionals, or coordinating patient care. Take care though that you don’t double report - some activities would be included under a separate code even though it may be for the same patient. 

Quality Payment Program

The good news is that the updates to the MPFS include provisions for the Merit-Based Incentive Payment System (MIPS). The MIPS will determine Medicare payment adjustments using your composite score, which includes data in four areas of your practice: quality, cost, improvement activities, and interoperability. This composite score determines whether your practice receives a bonus, no adjustment, or a penalty. A change established by CMS this year is the addition of the MIPS Value Pathways (MVPs), which is just an expansion of the four areas already covered in your composite score. This is intended to more cohesively cover all the aspects of care, and to take into account population health claims-based measures and how they compare to your score. MVPs don’t start until the 2023 performance year, but, according to CMS, you should start to see greater returns from this program as the scoring system starts to return higher payment adjustments. 

It’s important to take note of these changes not just for compliance, but as it can also affect your bottom line in the next couple of years. If you are not accurately coding, counting time, and participating in the MIPS program, you are leaving money on the table. 

Even though the conversion factor dropped, several other changes as part of the MPFS should have a positive impact on your practice. If you need help understanding these changes or have other anesthesia billing questions, reach out to us here!

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