The Centers for Medicare and Medicaid Services (CMS) released the 2024 final Physician Fee Schedule and Quality Payment Program regulation on November 2. The CMS reacted favorably to the CAP’s comments to increase pay to pathologists in 2024 from what had been first proposed in July.

The CAP successfully advocated for an increase to the cytotechnologist clinical labor rate used by the CMS in their practice expense methodology. This advocacy provides an increase to the technical component (TC) and global payments for some pathology services. Briefly, here are the key topics included in the 2024 proposed rule:

• The CMS continues to implement CAP requested increases to clinical labor rates.
• The CMS finalized the evaluation and management add-on code, G2211, causing budget neutrality adjustments that negatively affect pathologists and other specialties throughout the physician fee schedule.
• Download the impact table showing the proposed changes to pathology services in 2024.
• The CMS increased Medicare Quality Payment Program (QPP) requirements for 2024.
• Learn more: Register for the CAP’s webinar on November 30 reviewing the impact of new regulation and payment changes on pathologists and their laboratories.

Clinical Labor Rate Update

The CAP directly advocated to the CMS for a 12% increase to the cytotechnologist clinical labor rate used by the CMS in their practice expense methodology. This increase was supported by wage survey data and more accurately reflects cytotechnologist education, job duties, workforce shortages, and recruitment challenges. The CMS agreed with the CAP request and finalized a two-year phased-in increase starting in 2024. This increase adds to the CAP’s previous clinical labor rate advocacy. Notably, the CAP had advocated for an increase to the histotechnologist clinical labor rate used by the CMS in their practice expense methodology. The increase was finalized in 2023 and pathology continues to be benefit in this final rule as it is implemented over a three-year period. As a result, many pathology services will experience an increase to the TC and global payments in both 2024 and 2025.

Budget Neutrality Adjustments Caused by New Add-On Code

The CMS finalized payment for a new evaluation and management (E/M) add-on code, G2211, for ongoing, longitudinal patient care. This is an add-on code that physicians may list separately in addition to office/outpatient visits for new or established patients (ie, codes 99202-99215). This code may also be added even when the E/M visit is done via telehealth because the CMS has permanently added the code to the Medicare telehealth list.

The CMS is not restricting the code’s use to certain specialties and assumes that, on average, physicians will report G2211 with 38 percent of eligible E/M visits in 2024. Physicians that rely mainly on office/outpatient E/M visits, such as primary care specialties, are assumed to have relatively higher utilization of G2211. Due to budget neutrality requirements, this increased primary care spending will result in a two percent across-the-board cut to all physician payments. These cuts are expected to worsen over time as the CMS anticipates utilization of G2211 to grow to 54% of eligible E/M visits.

The CMS said code G2211 reflects the time, intensity, and practice expense required to build longitudinal relationships with patients and address most of their health care needs with consistency and continuity over long periods of time. In the context of primary care, the CMS believes the code recognizes the resources inherent in holistic, patient-centered care that combines the treatment of illness or injury, the management of acute and chronic health conditions, and the coordination of specialty care in a collaborative relationship with a clinical care team. The CAP contends that the implementation of G2211 essentially allows duplicative billing as the work of G2211 is already described and accounted for within the existing E/M CPT code set.

The CAP successfully lobbied Congress to delay payment for G2211 in 2021 when the CMS initially attempted to established payment for the code. The CAP will continue its advocacy efforts to protect the value of pathology services.

Final Rule Impact on Pathology Payment

The finalized 2024 conversion factor used for the fee schedule’s payment formula is $32.7375, representing a 3.39% decrease from the 2023 conversation factor. This decrease can largely be attributed to the implementation of the E/M add-on code G2211 and a 1.25% reduction in payments offered by the Consolidated Appropriations Act, 2023. The CAP clinical labor rate advocacy will help offset the cuts to pathology payment in 2024. Overall, the CMS estimates that pathology payments are expected to decrease by 2% from 2023 to 2024. The CAP continues to aggressively lobby Congress to mitigate these cuts to pathologists for 2024.

AMA and Mathematica Launch New Survey Effort for 2023/2024

The CMS acknowledged the AMA-led Physician Practice Information Survey for 2023-2024 with the primary purpose to collect representative data on practice expense and hours spent in direct patient care. This data will be collected at the specialty level and shared with the CMS to update the Medicare Economic Index and the Resource Based Relative Value Scale. The AMA has contracted the firm Mathematica, an independent research company with extensive experience in survey methods as well as care delivery and finance reform, to conduct this survey. Read more about this initiative.