February 28, 2021

Volume XI, Number 59


February 26, 2021

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February 25, 2021

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Summary of Key Provisions of Interim Final Rule: CMS Policy and Regulatory Revisions in Response to the COVID-19 Public Health Emergency

On March 30, 2020, the Centers for Medicare and Medicaid Services (“CMS”) announced an Interim Final Rule with Comment Period (the “IFC”) to address numerous regulatory and administrative changes in response to the COVID-19 pandemic. This Interim Final Rule was announced in conjunction with many other revisions and relaxations, and in addition to previously issued waivers, that CMS has made in the midst of the COVID-19 emergency in an effort to provide health care practitioners and providers with flexibility in safely getting patients the care they need.  We have summarized the Interim Final Rule’s key changes here.  

A. Payment for Medicare Telehealth Services under Social Security Act Section 1834(m)

CMS’s elimination of originating site requirements during the COVID-19 emergency, and the flexibility to provide telehealth services via audio and video enabled phones has already, prior to the IFC, triggered a substantial expansion in Medicare coverage of telehealth services.  The IFC provides additional flexibility, in recognition of the key role telehealth is playing in allowing providers to respond to the COVID-19 emergency.

Place of Service/Payment Rate

  • The IFC instructs physicians to report the POS code that they would have reported had the service been furnished in person (not the POS code for telehealth), which will allow payment to be made at the in-office rate (not the rate for professional services provided in a facility), in acknowledgement of the facts that (1) no originating site fee is generally being paid, and (2) physicians are seeing a much higher volume of patients via telehealth. This instruction will allow physicians to be reimbursed at a fair rate for the services they are providing.  Physicians who continue to submit telehealth claims with POS code 02 will be paid at the facility professional services rate.

  • The IFC also instructs physicians to use the CPT telehealth modifier (95) on claim lines describing services furnished via telehealth, which will allow CMS to identify and track these services.

Additional Medicare Telehealth Services

  • In the IFC, CMS adds services to the list of services that can be furnished via telehealth and billed to Medicare, retroactive to March 1, 2020. CMS explains that it has added these services on a “Category 2 basis” because there is a patient population that, because of COVID-19 exposure risk, would not otherwise have access to clinically appropriate treatment.  The IFC adds over 80 new codes, including emergency departments and home visits.

  • The IFC also adds codes for therapy services, but not when provided by physical therapists, occupational therapists, or speech-language pathologists, since these practitioner types are are excluded from the statutory definition of distant site practitioners.

  • For additional E/M codes, CMS instructs providers to select the E/M code that best describes the nature of the care provided, regardless of the physical location or status of patient.

B. Frequency Limitations on Subsequent Care Services in Inpatient and Nursing Facility Settings, and Critical Care Consultations and Required “Hands-on” Visits for ESRD Monthly Capitation Payments

  • Medicare coverage for subsequent hospital care services through telehealth has been limited to once per three days, and subsequent nursing facility visits have been limited to once per 30 days. The IFC removes frequency limitations for these and some other telehealth services.

  • The IFC also provides that required clinical examination of vascular access site furnished F2F hands on can now be furnished via telehealth.

  • CMS notes that Section 1881(b)(3)(B) requires certain non-telehealth F2F visits for ESRD patients who elect to receive most services via telehealth, but that it will enforcement discretion if these visits are furnished via telehealth during the COVID-19 emergency.

C. Telehealth Modalities and Cost-Sharing

  • The IFC revises 410.78(a)(3) to add “Exception: For the duration of the public health emergency…Interactive telecommunications system means multimedia communications equipment that includes, at a minimum, audio and video equipment permitting two-way, real-time interactive communication between the patient and distant site physician or practitioner.” This revision is intended to clarify that smart phones with audio and video functionalities is acceptable for provision of telehealth services during the COVID-19 emergency.

D. Communication Technology-Based Services (CTBS)

  • The IFC expands availability of G2010 (remote evaluation) and G2012 (virtual check-in), as follows:

    • The codes still cannot be used for services that result in a visit, including a telehealth visit, or originate from an E/M service within the previous 7 days.

    • The codes can be used for services furnished to new and established patients.

    • Consent may be documented by auxiliary staff under general supervision.

    • Consent is still required annually, but not at the same time a service is furnished.

    • The codes are available for services furnished by licensed clinical social workers, clinical psychologists, physical therapists, occupational therapists, and speech language pathology, and CMS is considering making the codes available for services furnished by other practitioners.

  • The IFC also expands availability of online digital evaluation and management codes (99421, 99422, 99423) and NPP online assessment and management codes (G2061, G2062, G2063), as follows:

    • CMS states that it will exercise enforcement discretion as to the requirement to use these codes only for services furnished to established patients.

    • CMS clarifies that codes G2061-2063 can be reported by a licensed clinical social work, a clinical psychologist, a physical therapist, an occupational therapist, or a speech language pathologist. This clarification states CMS’ general position, and applies before and after the COVID-19 emergency.

  • In the IFC, CMS designates G2010, G2012, G2061, G2062, G2062 as ‘sometimes therapy’ services that would require the therapist to include corresponding GO, GP, or GN therapy modifier on claims.

E. Direct Supervision by Interactive Telecommunications Technology

  • The IFC revises the definition of direct supervision to allow for direct supervision using real-time interactive audio and video technology, when indicated to reduce exposure risks for beneficiary or provider.

  • Application of the revised definition can include instances where physician enters into contractual arrangement for auxiliary personnel to leverage additional staff/technology (e.g. with a home health agency, qualified infusion therapy supplier, or ambulance company) to use staff under leased employment.

  • The IFC makes similar changes with respect to supervision of diagnostic services furnished directly or under arrangement in hospital or outpatient department, and pulmonary, cardiac, and intensive cardiac rehabilitation services.

F. Clarification of Homebound Status under the Medicare Home Health Benefit

  • The IFC clarifies that patients are considered homebound if it is medically contraindicated for them to leave home, including because of confirmed or suspected COVID-19 or because leaving the home would make them more susceptible to contracting COVID-19. Given the CDC recommendation that older adults stay home, CMS “expect[s] that many Medicare beneficiaries could be considered ‘confined to the home’”, but physician assessment and certification is required to make this determination.  This clarification applies before and after the COVID-19 emergency.

G. The Use of Telecommunications Technology Under the Medicare Home Health Benefit During the PHE for the COVID-19 Pandemic

  • The IFC amends 409.43(a) to allow home health agencies to use telecommunication systems in conjunction with provision of in-person visits. The use of this technology must be included on the patient’s plan of care.

  • CMS explains that, statutorily, technology cannot substitute for ordered in-person home visits. However, CMS notes that use of technology may result in changes to the frequency or types of visits outlined on plan of care in response to COVID-19.  For instance, a doctor may review a plan of care and – in light of circumstances related to COVID-19 – revise the plan to provide for certain visits to be provided via telehealth, rather than in-person.

H. The Use of Technology Under the Medicare Hospice Benefit

  • The IFC amends 42 CFR 418.204 to specify that when a patient is receiving routine home care, hospices may provide services via a telecommunications system if feasible and appropriate to ensure care during COVID-19. Such telecommunications use must be included on the patient’s plan of care.

I. Telehealth and the Medicare Hospice Face-to-Face Encounter Requirement

  • CMS provides that, for the duration of the COVID-19 emergency, a hospice designated attending physician may furnish services via telehealth and may perform a face-to-face visit solely for the purpose of recertification of hospice services via telehealth.

  • The IFC also amends 42 CFR 418.22(a)(4) to allow telecommunications technology for face-to-face visits during the COVID-19 emergency.

J. Modification of the Inpatient Rehabilitation Facility (IRF) Face-to-Face Requirement for the PHE During the COVID-19 Pandemic

  • The IFC provides that, during the COVID-19 emergency, required thrice weekly in-person physician visits may be conducted via telehealth.

K.Removal of the IRF Post-Admission Physician Evaluation Requirement for the PHE for the COVID-19 Pandemic and Clarification Regarding the “3-Hour” Rule

  • The IFC removes post-admission physician evaluation requirements for the duration of the COVID-19 emergency to give physicians more flexibility and reduce paperwork.

  • CMS leaves requirements for intensive rehabilitation therapy in place, but explains that, if an IRF’s intensive rehabilitation therapy program is impacted by the emergency, the IRF should not feel obligated to meet the industry standard (3 hours of therapy, five times per week), but instead should include a note in medical record as to why it was not meeting that standard.

L. Rural Health Clinics (RHCs) and Federally Qualified Health Centers (FQHCs)

Expansion of CBTS Services

  • The IFC expands services that can be included in payment for code G0071 and updates the G0071 payment rate to reflect this addition, to include 99421, 99422, and 99423. Effective March 1, the payment rate for G0071 will be average of non-facility rates for G2012, G2010, 99421, 99422, and 99423.  RHC and FQHC face-to-face requirements are waived for these services.

  • G0071 services will also be available to new patients (those not seen within last 12 months).

  • The IFC provides that consent can be obtained when services are furnished instead of prior to services, but must be obtained before billing, and that consent can be obtained by staff under general supervision.

Expansion of Visiting Nursing Services

  • For the purpose of coverage of visiting nurse services, any area typically served by the RHC or in FQHC service area plan is deemed to have a shortage of HHAs for the duration of the COVID-19 emergency.

M. Medicare Clinical Laboratory Fee Schedule: Payment for Specimen Collection for Purposes of COVID-19 Testing

  • Medicare will provide payment to independent laboratories for specimen collection for COVID-19 testing, paying a specimen collection fee and travel allowance. For homebound patients and non-hospital inpatients the specimen collection fee will be $23.46 and for SNF/HHA patients the specimen collection fee will be $25.46.

N. Requirements for Opioid Treatment Programs (OTP)

  • The IFC will allow therapy and counseling portions of the weekly bundle of services furnished by OTPs, as well as the add-on code for additional counseling or therapy, to be furnished using audio-only telephone if beneficiaries do not have access to two-way audio/video communications technology.

O. Application of Teaching Physician and Moonlighting Regulations during the PHE for the COVID-19 pandemic During the PHE for COVID-19

Revisions to Teaching Physician Regulations

  • The IFC will allow, for the duration of the COVID-19 emergency, the requirement for the presence of a teaching physician to be met either through physical presence or presence through interactive telecommunications technology during the key portion of the service.

  • Further, all levels of an office/outpatient E/M service provided in primary care centers may be provided under direct supervision of a teaching physician by interactive telecommunications technology.

  • PFS payment will be made for the interpretation of diagnostic radiology and other diagnostic tests when the interpretation is performed by a resident under direct supervision of the teaching physician by interactive telecommunications technology. The teaching physician must still review the resident’s interpretation.

  • The requirement for the presence of the teaching physician during the psychiatric service in which a resident is involved may be met by the teaching physician’s direct supervision by interactive telecommunications technology.

  • CMS provides that none of the above flexibilities apply to surgical, high risk, interventional, or other complex procedures, services performed through an endoscope, or anesthesia services.

Application of the Expansion of Telehealth Services to Teaching Physician Services

  • For telehealth services involving residents, the requirement that a teaching physician be present for key portions of the service can be met through interactive telecommunications technology, including by residents in primary care centers.

Payment under the PDS for Teaching Physician Services when Resident under     Quarantine

  • Medicare may also make payment under the PFS for teaching physician services when the resident is furnishing the services while in quarantine under direct supervision of the teaching physician by interactive telecommunications technology.

Revisions to Moonlighting Regulations

  • Services of residents that are not related to their approved GME programs and are performed in the inpatient setting of a hospital in which they have their training program are separately billable physicians’ services for which payment may be made under the PFS provided that –

    • the services are identifiable physicians’ services,

    • the services meet the conditions of payments for physicians’ services to beneficiaries,

    • the resident is fully licensed to practice in the state in which the services are performed, and

    • the services are not performed as part of the approved GME program.

P. Special Requirements for Psychiatric Hospitals (§ 482.61(d))

  • Under the IFC, NPPs or APPs may document progress notes of patients receiving services in psychiatric hospitals, in addition to MDs/DOs, as is currently allowed.

  • This change will continue to apply beyond COVID-19 emergency.

Q. Innovation Center Models

Medicare Diabetes Prevention Program Expanded Model Emergency Policy

  • Under the IFC, for the duration of the COVID-19 emergency, certain beneficiaries may obtain the set of MDPP services more than once per lifetime, for the limited purposes of allowing a pause in service and to provide flexibilities to allow MDPP beneficiaries to maintain eligibility for MDPP services despite a break in service, attendance, or weight loss achievement.

  • An MDPP supplier may offer to an MDPP beneficiary no more than: 15 virtual make-up sessions offered weekly during the core session period; 6 virtual make-up sessions offered monthly during the core maintenance session interval periods; and 12 virtual make-up sessions offered monthly during the ongoing maintenance session interval periods.

  • The limit to the number of virtual make-up sessions is waived for MDPP suppliers with existing capabilities to provide services virtually, as long as the virtual services are furnished in a manner consistent with CDC standards and requirements and are provided upon the individual MDPP beneficiary’s request.

  • MDPP suppliers may deliver virtual MDPP sessions on a temporary basis, or suspend in-person services and resume services at a later date.

Changes to Comprehensive Care for Joint Replacement Model and Change Extreme and Uncontrollable Circumstances Policy

  • The IFC implements a 3-month extension to CJR performance year 5 – the model now ends on March 31, 2021 rather than December 31, 2020.

  • The IFC also makes the extreme and uncontrollable circumstances policy applicable to CJR episodes impacted by the COVID-19 pandemic and broadens the policy so all participant hospitals are located in the emergency area and qualify for applicable financial safeguards.

  • For a fracture or non-fracture episode with a date of admission to the anchor hospitalization that is on or within 30 days before the date that the emergency period begins or that occurs through the termination of the emergency period, actual episode payments are capped at the target price determined for that episode.

R. Remote Physiologic Monitoring

  • Under the IFC, for the duration of the COVID-19 emergency, RPM services may be furnished to new patients, as well as to established patients.

  • Consent to obtain RPM services may be obtained once annually, including at the time services are furnished. However, recommend that practitioners reviews consent information with a beneficiary, obtain the beneficiary’s verbal consent, and document in the medical record that consent was obtained.

  • RPM codes can be used for physiologic monitoring of patients with acute and/or chronic conditions.

S. Telephone Evaluation and Management (E/M) Services

  • During the COVID-19 emergency, CMS will pay for CPT codes 98966-98968 and CPT codes 99441-99443 (telephone E&M services), with work RVUs as recommended by the AMA HCPAC.

  • These services may be provided to both established and new patients. Where descriptors refer to “established patient,” CMS will not conduct review to consider whether those services were furnished to established patients.

T. Physician Supervision Flexibility for Outpatient Hospitals – Outpatient Hospital Therapeutic Services Assigned to the Non-Surgical Extended Duration Therapeutic Services (NSEDTS) Level of Supervision

  • During the COVID-19 emergency, supervision requirement for NSEDTS are reduced to minimum level of general supervision.

U. Application of Certain National Coverage Determination and Local Coverage Determination Requirements During the PHE for the COVID-19 Pandemic

Face-to-Face and In-Person Requirements

  • To the extent an NCD or LCD (including articles) would otherwise require a face-to-face or in-person encounter for evaluations, assessments, certifications or other implied face-to-face services, those requirements do not apply for the duration of the COVID-19 emergency.

Clinical Indications for Certain Respiratory, Home Anticoagulation Management and Infusion Pump Policies

  • During the COVID-19 emergency, CMS will not enforce clinical indications for coverage across respiratory, home anticoagulation management and infusion pump NCDs and LCDs (including articles) allowing for maximum flexibility for practitioners to care for their patients.

V. Requirements for Consultations or Services Furnished by or with the Supervision of a Particular Medical Practitioner or Specialist

  • To the extent NCDs and LCDs require a specific practitioner type or physician specialty to furnish a service, procedure or any portion thereof, the chief medical officer or equivalent of the facility can authorize another physician specialty or other practitioner type to meet those requirements during the COVID-19 emergency.

  • To the extent NCDs or LCDs require a physician or physician specialty to supervise other practitioners, professionals or qualified personnel, the chief medical officer of the facility can authorize that such supervision requirements do not apply during the COVID-19 emergency.

W. Change to Medicare Shared Savings Program Extreme and Uncontrollable Circumstances Policy

  • The 2019 MIPS data submission and the Shared Savings Program data submission deadlines are extended by 30 days until April 30, 2020.

  • For MIPS eligible clinicians that do not participate in APMs, the MIPS automatic extreme and uncontrollable circumstances policy will apply if MIPS data is not submitted by the extended timeline. If no data is submitted, those MIPS eligible clinicians will have all performance categories reweighted to zero percent, resulting in a score equal to the performance threshold and a neutral MIPS payment adjustment. If a MIPS eligible clinician submits data on two or more MIPS performance categories, the clinician will be scored and receive a 2021 MIPS payment adjustment based on the final score.

  • MIPS eligible clinicians who are subject to the APM scoring standard will continue to be scored under the existing APM scoring standard.

  • The IFC eliminates the restriction that prevents the application of the Shared Savings Program extreme and uncontrollable circumstances policy for disasters that occur during the quality reporting period if the reporting period is extended.

  • The IFC reduces the amount of an ACO’s shared losses, for performance year 2020 and subsequent years if applicable, by an amount determined by multiplying the shared losses by the percentage of the total months in the performance year affected by an extreme and uncontrollable circumstance and the percentage of the ACO’s assigned beneficiaries who reside in an affected area (which, for COVID-19, is the entire United States).

X. Level Selection for Office/Outpatient E/M Visits When Furnished Via Medicare Telehealth

  • CMS explains that the office/outpatient E/M level selection for these services when furnished via telehealth can be based on medical decision making or time, with time defined as all of the time associated with the E/M on the day of the encounter.

  • For the duration of the COVID-19 emergency, the IFC removes any requirements for these services regarding documentation of history and/or physical exam in the medical record.

Y. Counting of Resident Time During the PHE for the COVID-19 Pandemic

  • The IFC permits a hospital that is paying a resident’s salary and fringe benefits to count the time that the resident is at home or in the home of a patient that is already a patient of the physician or hospital, but performing patient care duties within the scope of the approved residency program, for IME and DGME purposes, for the duration of the COVID-19 emergency.

Z. Addressing the Impact of COVID-19 on Part C and Part D Quality Rating Systems

HEDIS, CAHPS, and HOS Data Collection and Submission for 2021 Star Ratings and 2022 Star Ratings

  • The IFC eliminates the HEDIS 2020 submission requirement that covers the 2019 measurement year and requesting that Medicare health plans, including MA and Section 1876 organizations, curtail HEDIS data collection work immediately.

  • The IFC also amends requirements for submission of the CAHPS survey data to CMS for Medicare health and drug plans as it applies to the 2020 survey data collection; Part C and D plans may use any CAHPS survey data already collected.

  • The IFC eliminates requirements for collection of HEDIS and CAHPS data that would otherwise occur in 2020.

  • For 2021 Star Ratings only, Part D sponsors are not required to submit CAHPS data that would otherwise be required for 2021 Star Ratings.

  • If HOS survey data cannot be collected for 2022 Star Ratings, may use the Star Ratings and measure scores for the 2021 Star Ratings for any measures that come from the HOS survey.

Adjustments to the 2021 Star Ratings Methodology due to Lack of HEDIS and CAHPS Data

  • CMS provides that it will use the HEDIS measure scores and Star Ratings based on the 2018 measurement year and the CAHPS data submitted in June 2019 for the 2021 Star Ratings.

  • CMS will carry forward the measure-level improvement change score from the 2020 Star Ratings for all HEDIS or CAHPS measures for the 2021 Star Ratings Part C and D improvement measure calculations.

  • For the 2021 Star Ratings, CMS will not reduce HEDIS and CAHPS measures to 1 star for failure to report the 2020 HEDIS or CAHPS data.

Use of 2020 Star Ratings to Substitute for 2021 Star Ratings

  • If CMS’ functions become focused on only continued performance of essential agency functions or the agency and its contractors do not have the ability to calculate the 2021 Star Ratings, CMS will use the 2020 Star Ratings as the 2021 Star Ratings.

2022 Star Ratings

  • CMS is delaying implementation of the guardrails, so that cut points can change by more than 5 percentage points if national performance declines, until the 2023 Star Ratings produced in October 2022.

  • CMS is revising the methodology for the Part C and D improvement measure for the 2022 Star Ratings to expand the hold harmless rule to include all contracts at the overall and summary rating levels.

  • For the 2022 Star Ratings, CMS will calculate the CAI values will be calculated based on the 2021 Star Ratings data, which will use the older HEDIS and CAHPS data from the 2020 Star Ratings.

  • For the 2022 QBP ratings that are based on 2021 Star Ratings, CMS is modifying the definition of a “new MA plan” to treat an MA plan as new if it is offered by a parent organization that has not had another MA contract for the previous 4 years (currently 3 years).

AA. Changes to Expand Workforce Capacity for Ordering Medicaid Home Health Services, Medical Equipment, Supplies and Appliances and Physical Therapy, Occupational Therapy or Speech Pathology and Audiology Services

  • For the duration of the COVID-19 emergency, CMS is allowing licensed practitioners practicing within their scope of practice, including but not limited to NPs and PAs, to order Medicaid home health services. This flexibility applies to home health nursing and aide services, medical supplies, equipment and appliances, and physical therapy, occupational therapy, or speech pathology and audiology services.

BB. Origin and Destination Requirements Under the Ambulance Fee Schedule

  • The IFC, for the duration of the COVID-19 emergency, expands the list of permissible destinations at 410.40(f) to include all destinations from any point of origin that are equipped to treat the condition of the patient.

  • CMS notes that home may be an appropriate destination for a patient discharged to be under quarantine.

CC. Merit-based Incentive Payment System Updates

  • CMS designates a new improvement activity – clinician participation in COVID-19 clinical trial utilizing drug or biological product to treat patient with COVID-19, with findings reported through opens source clinical data repository or clinical data registry.

  • CMS also notes that its extreme and uncontrollable circumstances policy will be available, including for individuals, groups, and virtual groups to allow reweighting and that the MIPS reporting deadline is extended to April 30, 2020.

DD. Inpatient Hospital Services Furnished Under Arrangements Outside the Hospital During the Public Health Emergency (PHE) for the COVID-19 Pandemic

  • The IFC provides flexibility to hospitals to provide routine services outside the hospital under arrangements.

EE. Advance Payments to Suppliers Furnishing Items and Services under Part B

  • The IFC gives contractors more flexibility to make advance payments and to make advances at 100% of anticipated payments to providers and suppliers.

Copyright © 2020, Sheppard Mullin Richter & Hampton LLP.National Law Review, Volume X, Number 99



About this Author


Ms. Kraus focuses her practice on representing healthcare entities in regulatory compliance matters.  Ms. Kraus advises clients on compliance with federal and state fraud and abuse laws, assists clients in responding to government investigations, and represents clients in False Claims Act litigation.  Ms. Kraus also assists clients with regulatory due diligence in transactional matters, and through advocacy with federal and state regulators, and leverages her background in health policy to help clients maximize opportunities in the changing healthcare landscape...

Theresa E. Thompson, Sheppard Mullin Law Firm, Washington DC, Corporate Law Attorney

Theresa E. Thompson is an associate in the Corporate and Securities Practice Group in the firm's Washington, D.C. office.

Areas of Practice

Ms. Thompson's practice focuses on such areas as health care fraud and abuse, particularly in matters relating to the civil False Claims Act, physician self-referral (Stark law), and anti-kickback issues, as well as telehealth and telemedicine. She has experience in government investigations, litigation, and regulatory compliance, including in response to government...