CMS 2021 Final Rule: What practices can do

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Insights from MGMA’s Medical Practice Excellence Pathways Conference.

At MGMA’s Medical Practice Excellence Pathways Conference, Justin Chamblee, CPA and senior vice president of Coker Group, gave a presentation overviewing CMS’s 2021 Final Rule changes and exploring the impact these changes will have on wRVUs and physician compensation.

According to the presentation, some key changes to the 2021 Office / Outpatient E/M codes include:

  • The elimination of 99201
  • History and exam no longer count toward code level
  • Level of service is based on time OR medical decision making
  • New prolonged care codes specifically for office/outpatient in 15- minute increments
  • New times associated with office E/M codes

Net increases in RVUs means that Medicare payments for E/M visits will increase in 2021, then fall in 2022 compared to 2021 levels, Chamblee said in his presentation. Furthermore, due to budget neutrality requirements, payments for other services will be reduced and, as a result, some specialties will experience reimbursement increases while others experience decreases

Specialties that focus on office visits are expected to experience the most significant positive impact. Specialties that are hospital-based or focus on procedures are expected to experience the most significant negative impact.

The table below lists how Chamblee has calculated each specialty may be effected.

Positively Impacted (+3% or more)

Moderatley Impacted (-2% to +2%)

Negatively Impacted (-3% or more)

  • Family Medicine
  • Nephrology
  • Endocrinology
  • Neurology
  • OB/GYN
  • Pediatrics
  • Urology Psychiatry
  • Otolaryngology
  • Allergy/Immunology
  • Endocrinology
  • Rheumatology
  • Hematology/Oncology
  • Interventional Pain Management
  • NPs/PAs
  • Vascular Surgery
  • Dermatology
  • Podiatry
  • Cardiology
  • Geriatrics
  • Pulmonary Disease
  • Internal Medicine
  • Radiology
  • Anesthesiology (MD/CRNA/AA)
  • General Surgery
  • Orthopedic Surgery
  • Chiropractor
  • Critical Care
  • Emergency Medicine
  • Pathology
  • Thoracic Surgery
  • General Surgery
  • Colon/Rectal Surgery
  • Infectious Disease
  • Neurosurgery
  • Plastic Surgery
  • Gastroenterology
  • Orthopedic Surgery
  • Physical Medicine
  • Radiation Oncology

Below are some tips from the presentation regarding what practices should do to prepare for these changes.

Chamblee says that practices should be slow to make changes until they understand the impact such changes could have on the overall organization.

“Really do a good bit of financial analysis, understand the impact on worker use on collections, not only for 2021…” he says.

Practices should also consider conducting an impact assessment on how the 2021 MPFS changes will affect wRVUs and total revenue, while also reviewing the total economic impact (subtract total physician compensation change from total revenue change), and then determine the appropriate course of action that best fits the organization’s needs.

If possible, the 2020 fee schedule can mitigate the impact of lower reimbursement conversation factor on the overall bottom line while more diligence is completed, Chamblee says.

“This is not a long-term solution. This is more so to provide breathing room to figure out what a long-term solution may be,” he says.

Due to the changes that we have seen here, and the fact that many organizations feel hamstrung contractually by the language in their contracts, we've [suggested]… maybe provide a more generic statement that says that we will base our work over us initially on the 2020 fee schedule, but then future adjustments to that will be subject to the discretion of the medical group or the health system,” Chamblee says.

Practices should review contracts and ensure you are not locked into using a specific fee schedule. Ideal language would give the medical group the discretion to decide on which fee schedule to use.

Camblee provided examples of language that locks you in, versus language that allows flexibility.

Language that locks you in: “wRVUs will be based on the schedule published by the Center’s for Medicare and Medicaid Services (CMS) that is in place on the applicable date of service”

Language that allows flexibility: “wRVUs will initially be based on the 2020 schedule published by the Centers for Medicare and Medicaid Services (CMS), and, subject to the discretion of [Medical Group], may be adjusted each [insert date] during the term of this Agreement to be based on the immediately preceding year’s schedule published by CMS”

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When reviewing RVUs and collections to understand the impact of the 2021/2022 MFPS changes, Chamblee says practices should review:

  • Current production (wRVUs and professional collections)
  • Analyze the impact of the 2021 and anticipated 2022 MPFS changes using 2020 productivity
  • Compare 2020 to the estimated 2021 and 2022 results
  • Identify where changes can be made (generally TCC per wRVU) to mitigate the impact to physician compensation