2024 Physician Fee Schedule - Breakthrough

2024 Physician Fee Schedule

The 2024 Physician Fee Schedule Proposed Rule includes yet another cut to Medicare reimbursements for physical therapy services.

Proposed Medicare Cuts and What You Can Do About Them

The Centers for Medicaid and Medicare Services (CMS) issued the 2024 Physician Fee Schedule (PFS) proposed rule on July 13, 2023. The proposed changes include a 3.3% cut to the conversion factor — yet another cut to physical therapy reimbursements. The current conversion factor is already lower than in 1994, when the U.S. dollar held 52% more value (before decades of inflation).  

CMS is accepting public comments on proposed policy changes until September 11, 2023. If approved, the changes will take effect on or after January 1, 2024. 

To get a better understanding of what’s in the 2024 Physician Fee Schedule proposed rule, Chad Madden spoke with Mary Daulong, President and CEO of BCMS. Mary shares the biggest takeaways from the Proposed Rule. Together, they discuss what practice owners can do to maintain profitability.

This article summarizes what we learned. Continue reading for expert insights into the proposed policy changes and practical steps you can take to navigate Medicare Cuts.

TABLE OF CONTENTS

Understanding the 2024 Physician Fee Schedule Proposed Rule

How to Submit Comments on the Proposed Rule

How to Survive Medicare Cuts in the 2024 Physician Fee Schedule

Maintaining Profitability Under Pressure

Understanding the 2024 Proposed Physician Fee Schedule

The 2024 Physician Fee Schedule includes another cut to the conversion factor, and policy changes to telehealth services, caregiver training and codes, the KX modifier threshold, the supervision policy, and more. 

Readers are encouraged to participate in the comment process and advocate for changes that benefit your practice and your patients. 

While the proposed reimbursement cuts pose challenges, there are steps you can take to maintain profitability and continue providing high-quality care to your community. 

Let’s take a look at the major updates in the 2024 Physician Fee Schedule.

Conversion Factor

The primary concern in the proposed rule is the 3.34% reduction in the conversion factor compared to 2023. The proposed 2024 conversion factor is $32.75, a decrease of $1.14. This cut to the conversion factor represents the fourth consecutive year of cuts. Congressional funding for 2024 is projected to offset the reduction by 1.25%, which is less generous than the previous year. With congressional funding factored in, the expected reduction is 2.09% from the 2023 conversion factor. 

Supervision of Physical Therapist Assistants 

Since 2005, CMS has required PTs in private practices to conduct direct supervision of PTAs. CMS is soliciting comments on whether they should change the direct supervision requirement for outpatient therapists when working with therapy assistants to general supervision. They are particularly interested in aspects such as quality of care, patient safety, and utilization changes. Advocating for improved patient access to services and stable outcomes can be key points in your comments.

CMS is also proposing a regulatory change to allow for general supervision of PTAs for remote therapeutic monitoring (RTM) services. 

Expansion of Telehealth Services

The proposed rule expands the definition of telehealth practitioners to include physical therapists, occupational therapists, and speech and language pathologists. This extension can be beneficial as it maintains the non-facility rate for reimbursement, which is generally higher for physical therapy services.

Telehealth Supervision

CMS is also seeking comments on whether they should extend the definition of direct supervision in telehealth. Focusing on quality, patient safety, and access to care can be powerful points to make in your comments.

Caregiver Training and Education Codes

CMS has introduced three new codes for caregiver training and education, which can be utilized by therapists when it’s part of a patient’s care plan. These codes aim to educate caregivers in assisting patients with specific diseases and illnesses, emphasizing the importance of the patient’s functional performance. This aligns with a recent Biden-Harris Administration Executive Order on Increasing Access to High Quality Care and Supporting Caregivers. If finalized, it would help support care for persons with Medicare by better training caregivers.   

Undervalued CPT Codes

In early 2023, the APTA argued to CMS that 19 different codes, including therapeutic exercises, neuromuscular reeducation, gait training, and therapeutic activities, were undervalued by the AMA Relative Value Scale Update Committee that sets payment rates typically adopted by CMS. These codes were simultaneously subject to reductions associated with the Multiple Procedure Payment Reduction (MPPR) system. APTA argued that discounting the codes twice was unacceptable. 

In the proposed rule, CMS directs the AMA committee to review its earlier recommendations. If the recommendation proposed by APTA is adopted, the value of the codes on the list could increase.

The full list of codes affected can be found on page 66 of the proposed rule. When commenting, be sure to advocate for the APTA’s recommended increases to the value of these codes. 

KX Modifier Threshold and Targeted Medical Review Threshold

The KX modifier threshold for PT and Speech has increased to $2,330. This is a $100 increase over 2023. The targeted medical review threshold is $3,000 and will remain so at least through 2028. 

Provider Enrollment

CMS is proposing several regulatory provisions regarding Medicare and Medicaid provider enrollment. The most important of these is a proposed requirement to report additions, deletions, and changes to practice locations within 30 days. 

How to Submit Comments on the 2o24 Physician Fee Schedule Proposed Rule

It’s crucial to participate in the process by providing comments on the proposed rule. Comments are due by September 11, 2023 so don’t miss this opportunity to make your voice heard. APTA’s comment submission tool includes templates to make commenting easier and more effective. Submit your comments at https://regulations.gov/

How to Survive Medicare Cuts in the 2024 Physician Fee Schedule

Practice owners cannot afford to be complacent in this challenging environment. To survive years of cuts, it’s critical to take strategic actions in your practice to hedge against declining reimbursements. 

The key is to identify ways you can increase revenue and improve profitability. Those who do nothing are taking on major financial risk. Unfortunately, most practices won’t take action. Those who take strategic actions have an opportunity to reduce financial risk and stand out from the crowd.

So what you can do to successfully navigate Medicare Cuts?

The Profitability Checklist

Chad Madden and Breakthrough developed a profitability checklist based on expert advice and proven strategies.

Here are some key steps to take to increase your practice profitability:

  1. Increase Utilization: Focus on filling up your schedules and optimizing your clinic space to increase patient flow and revenue.
  2. Insurance Contract Review: Assess your insurance contracts. Negotiate rates – see one practice owner’s success negotiating a 10% YOY increase from his biggest payer for three years. Consider dropping your lowest payer. Identify ways to attract more patients covered by your best payers.
  3. Increase Lifetime Patient Value: Lifetime Patient Value represents the total revenue generated by a single patient over their lifetime of their journey with your practice. Explore opportunities to boost lifetime patient value by adding cash pay services, reactivating past patients, and sourcing patient referrals.
  4. Get Consistent with Marketing: In order to maintain full schedules consistently, year-round, it’s essential to consistently implement effective marketing. Consistency is the key. Focus your marketing on strategies to reactivate past patients and attracting better-paying patients.

Want to learn how you can successfully renegotiate reimbursement rates? Get Your Free Copy of the Insurance Renegotiation Template. 

Frustrated with declining physical therapy reimbursement rates? Discover effective strategies for negotiating reimbursement rates.

Maintaining Profitability Under Pressure

Despite the challenges posed by proposed Medicare cuts, you can proactively manage your practice’s profitability. By implementing the strategies outlined in the profitability checklist, you’ll be better equipped to navigate the challenging landscape for private practice owners. 

Remember that profitability is not solely dependent on reimbursement rates but also on your ability to stay agile, adapt, innovate, and optimize various aspects of your practice. By focusing on increasing utilization, reviewing insurance contracts, increasing lifetime patient value, and optimizing your marketing, you can position your practice for success in 2024 and beyond.

Still unsure how you’ll navigate your practice through the proposed changes in the 2024 Physician Fee Schedule? 

Chad Madden spent decades of his career and hundreds of thousands of dollars to discover and implement strategies to help navigate the constantly changing healthcare landscape. These exact strategies resulted in a 5X growth in practice value, from $4 million in 2016 to $20.8 million in 2023. Through Breakthrough, Chad has helped hundreds of other practices implement the exact same strategies. 

You can learn more about strategies to help you navigate 2024 Medicare Cuts in a free strategy call with Breakthrough. 

Discover PT profitability strategies for navigating 2024 Medicare Cuts. Book a free strategy call.

We encourage you to utilize the provided resources and take action to protect the future of your practice. Together, we can navigate these challenges to maintain the financial health of your practice so you can continue to provide exceptional care to patients. 

 

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