The First Word on the Final Rule: Anesthesia Takes an Unexpected Hit

-->November 11, 2019Billing & Compliance Alerts

    November 11, 2019

    Do you ever get the feeling that things are going along a little too well?  At least as it concerns your own personal situation, do you sometimes think: “Wow, I’m living the dream!  I’m healthy, I’m happy, I’m prospering;” but in the back of your mind, you’re wondering if bad news is just around the corner.  That is undoubtedly a normal human experience, and sometimes that gnawing feeling of looming letdown is justified.  Recent information emanating from the Centers for Medicare and Medicaid Services (CMS) may serve as the source for such a letdown for millions of anesthesia providers across the country.

    A pre-release of the 2020 Medicare Physician Fee Schedule (MPFS) Final Rule has recently become available, ahead of its official publication date of November 15.  It will take weeks to fully digest the complete scope and real impact of the 2,475-page Rule, but there are a few takeaways that we can provide to our readers at this time.  They are highlighted below:

    Anesthesia Conversion Factor

    Perhaps the most important component of the Rule that will be of interest to our readers involves the finalization of the national anesthesia conversion factor (ACF).  As you will recall from a prior alert, we reported that the Proposed Rule for 2020 had set the ACF at 22.2774, reflecting a negligible, though technical, increase from this year’s ACF of 22.2730.  It is with great surprise and disappointment to learn that the Final Rule has actually decreased the ACF for next year to 22.2016.

    Of all the provisions set in stone by the Final Rule, this is the one that will undoubtedly cause the most consternation on the part of our clientele.  Though admittedly a minimal change, we certainly don’t like to see this figure heading in the wrong direction.

    Conversion Factor (Non-Anesthesia)

    While the ACF will be lower than both this year’s rate and the Proposed Rule’s rate, the non-anesthesia conversion factor (CF) for 2020 will remain as proposed.  Accordingly, the national CF for next year will be 36.0896, which represents a slight increase from this year’s CF of 36.0391.  To clarify, the CF is used to determine the value of non-anesthesia procedures, such invasive lines, postoperative pain blocks and ultrasound guidance.

    Nerve Injection Payments

    The American Society of Anesthesiologists (ASA) is reporting that the Final Rule has kept in place CMS’s intention to devalue payments for somatic nerve block codes as addressed in the 2020 Proposed Rule.  You will recall that we discussed this issue in an alert this summer.

    Documentation for Visits in 2021

    The Final Rule points to significant changes for evaluation and management (E/M) codes and documentation, beginning in 2021.  The five coding levels for established patients will be retained, but CMS will reduce the number of office/outpatient E/M visits for new patients to four levels.  In addition, code definitions will be revised along with the associated time, per level.  A patient history and exam will only be required “as medically appropriate.”  Finally, clinicians will be allowed to choose the E/M level based on either medical decision-making or the time factor.

    Payment for Visits in 2021

    In another potential blow to anesthesia providers, the Final Rule addressed the relative value units (RVUs) for E/M services that will take effect in 2021.  As you will recall, RVUs greatly impact overall payment rates.  Based on the RVUs listed in the Final Rule, 2021 payments for E/M services (such as the 99202-99215 code set) will be significantly increased.  For example, payment for CPT 99214 will increase from $109 to $136 per claim in 2021, reflecting a 25 percent increase. Payment for CPT 99213 is scheduled to increase by nearly 30 percent.

    You may ask how this is detrimental to anesthesia.  Remember that CMS is committed to budget neutrality where possible.  If the agency significantly increases the payment for the above referenced E/M code set—which currently represents 20 percent of all Medicare Part B payments—then CMS will quite likely make compensatory cuts in the payment values for other services in 2021.  That being the case, some are quite naturally concerned that anesthesia payments may be reduced in 2021 in order to make way for the E/M payment hikes scheduled for that year.  Moreover, since anesthesia tends to make less use of E/M codes than other specialties, the adverse effects on overall reimbursement for anesthesia in 2021 may be particularly severe.

    CRNA Scope of Practice

    The Final Rule confirms that nurse anesthetists (CRNAs) are allowed, in keeping with state law, to perform the pre-anesthesia assessment—at least as it concerns the ambulatory surgical center (ASC) setting.  The Rule clarifies that “a physician must examine the patient to evaluate the risk of the procedure to be performed,” while either “a physician or anesthetist must examine the patient to evaluate the risk of anesthesia.”  In other words, a physician, such as the surgeon, must perform the preoperative evaluation as to the surgical procedure in question, but a CRNA may perform the pre-anesthesia assessment.

    Finally, it should be noted that this provision in no way alters the medical direction requirements.  A case involving a medically directed CRNA will still require an anesthesiologist to perform the pre-anesthesia assessment.

    CRNA Documentation

    New provisions in the Final Rule allow advanced registered nurse practitioners (ARNPs), such as CRNAs, to have a diminished burden when documenting their review of certain medical records.  According to CMS:

    . . . anesthetists . . . can review and verify (sign and date), rather than re-documenting, notes made in the medical record by other physicians, residents, medical, physician assistant, and APRN students, nurses, or other members of the medical team.

    PA Supervision

    For groups that utilize physician assistants (PAs) in their perioperative, palliative or chronic pain care divisions, you will be interested to know that CMS is clarifying its guidelines relative to physician supervision of a PA.  The Final Rule allows PAs to practice in accordance with the physician supervision laws and scope of practice rules of the state in which their services are provided.  Where state law is silent on physician supervision of PAs, Medicare requires documentation in the medical record indicating the PA’s approach to working with physicians in furnishing his/her services.

    Quality Payment Program

    In slight variance with its proposals as promulgated this past summer, the Final Rule sets forth the following percentage breakdown in Merit-based Incentive Payment System (MIPS) scoring:

    • Quality – 45 percent
    • Cost – 15 percent
    • Promoting Interoperability – 25 percent
    • Improvement Activities – 15 percent

    The Final Rule raised the exceptional performance threshold to 85 points for 2020, rather than the 80 points previously called for in the Proposed Rule.

    Ominously, CMS also finalized more difficult standards for Qualified Clinical Data Registries (QCDRs)—as discussed in the Proposed Rule—including the requirement of greater clinical input on measures.  According to some experts, this change is “expected to drive many QCDRs out of business.”  We will be providing a more robust description of the changes in the Quality Payment Program in a future alert.


    We will continue to update you on the Final Rule provisions as more information is reviewed, interpreted and analyzed.  If you have questions on how any of the Rule elements, discussed above, may impact your practice, please do not hesitate to contact your account executive.  Lastly, on this Veterans Day, we wish to acknowledge and thank all those who serve or have served in our armed forces.  Your sacrifice on behalf of your country is not forgotten.

    We want to hear from you. Do you have a topic you would like to see covered in a Medac eAlert? Please send your suggestions to