Impact of 2023 Physician Fee Schedule on Emergency Medicine Groups

The 8 to 24-Hour Inpatient/Observation Rule states that a patient must undergo observation care for a minimum of 8 hours to be eligible for same-day observation codes as per the Medicare physician fee schedule. If a Medicare patient’s observation stay is shorter than 8 hours, providers must use the inpatient codes 99221-99223 instead. 


The CMS has postponed its proposal to only consider the time component when defining the term “substantive portion” used to determine the billing practitioner for a split or shared visit in the Medicare physician fee schedule. The new definition was set to take effect on January 1, 2023, however, numerous organizations argued that it contradicts the fundamental idea of collaborative care by creating competition between physicians and advanced practitioners. As a result, the new definition has been delayed until January 1, 2024, or until the CMS releases further guidance.


Quality Payment Program Update For Emergency Physician Group:


The final rule includes modifications to the MIPS quality payment program, which determines the Medicare payment adjustments for an emergency physician group that deliver services under Medicare Part B, including emergency and outWhat Do You Need to Know About Emergency Physician Group Medicare Physician Fee Schedule?


The 2023 physician fee schedule will bring significant changes to the emergency physician group. CMS has updated the Medicare physician fee schedule (MPFS) to affect Part B payments for an emergency physician group, diagnostic tests, and other outpatient services. The update brings new reimbursement rules to the CMS quality payment program and a reduction in the Medicare conversion factor. The conversion factor has been reduced to $33.0607, a 4.48% decrease from the previous year. The spending package includes a 2.5% relief in 2023 and 1.25% in 2024.

The 2023 Medicare physician fee schedule includes several new coding policies aimed at simplifying documentation requirements and updating payment guidelines for Evaluation & Management (E/M) services. CMS has adopted the same guidelines established by commercial payers in the recent CPT revisions to the E/M code sets. The Medicare physician fee schedule update shifts the emphasis to Medical Decision Making (MDM) for determining the acuity level of a patient visit, instead of requiring a specific number of elements in the History of Present Illness and Exam sections of the patient record. Additionally, CMS has confirmed the current RVUs of 2.74 for emergency department Level 4 visits, instead of reducing it to 2.60.


The biggest challenge posed by the new coding guidelines is related to services currently billed with CPT code 99285 for high-acuity patients who are not hospitalized commonly referred to as “treat-and-release.” General documentation guidelines will typically support billing with a 99285 for patients who are admitted to the hospital. However, emergency medicine physicians will need to be more explicit in documenting their Medical Decision Making (MDM) when the patient is discharged.


Inpatient/Observation Rule For Emergency Physician Group:

patient services. In 2023, clinicians can gain (or lose) up to 9% of their annual Medicare revenue based on their MIPS score. The eligibility criteria for those who have traditionally met the quality reporting requirement through their participation in an accountable care organization (ACO).


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