2025 Medicare Physician Fee Schedule: CMS Reimbursement Rates Explained

The Centers for Medicare & Medicaid Services (CMS) has released its proposed Medicare Physician Fee Schedule for 2025, outlining significant changes to reimbursement rates by CPT code. This annual update has a profound impact on healthcare providers and patients alike, shaping the landscape of Medicare Part B services and payment rates. The proposed schedule introduces revisions to various aspects of the healthcare system, including preventive services, drug pricing, and behavioral health services.

The 2025 Medicare Physician Fee Schedule aims to address several key areas within the healthcare sector. It proposes modifications to CPT and HCPCS codes, adjustments to geographic practice cost indices, and updates to payment rates for physician services. Additionally, the schedule includes provisions for rural health clinics and federally qualified health centers, as well as proposals to tackle health-related social needs. These changes are poised to influence the delivery and accessibility of healthcare services for Medicare beneficiaries across the United States.

Proposed Changes to Preventive Services Coverage

The 2025 Medicare Physician Fee Schedule introduces significant modifications to preventive services coverage, aiming to enhance healthcare accessibility and improve patient outcomes. These changes reflect the Centers for Medicare & Medicaid Services’ (CMS) commitment to aligning reimbursement rates with evidence-based practices and addressing evolving healthcare needs.

Expansion of Hepatitis B Vaccination Coverage

CMS has proposed an expansion of coverage for Hepatitis B vaccinations, recognizing the importance of preventive measures against this viral infection. Under the new guidelines, Medicare Part B will cover Hepatitis B shots for individuals at medium or high risk. This coverage applies to various groups, including those with hemophilia receiving factors VIII or IX, patients with End-Stage Renal Disease (ESRD), individuals with diabetes, those living with someone who has Hepatitis B, and healthcare workers with frequent exposure to blood or bodily fluids.

This expansion aims to reduce the incidence of Hepatitis B among vulnerable populations and alleviate the financial burden associated with preventive care. Beneficiaries will pay nothing for Hepatitis B shots if their healthcare provider accepts assignment for administering the vaccine.

Updates to Colorectal Cancer Screening

The proposed schedule includes significant updates to colorectal cancer (CRC) screening coverage, aligning with the latest evidence-based guidelines. CMS plans to add coverage for computed tomography (CT) colonography while removing coverage for barium enema. This change reflects advancements in screening technology and aims to provide more effective and less invasive options for beneficiaries.

Furthermore, CMS proposes to expand its “complete CRC screening” approach. This expansion would include coverage for either a Medicare-covered blood-based biomarker test or a non-invasive stool-based test. Importantly, if a follow-up colonoscopy is required after a positive result from these tests, beneficiaries would not incur any cost-sharing. This approach is designed to encourage more patients to undergo CRC screening without the fear of unexpected medical bills.

Wenour’s Preventive Services Billing

As healthcare providers navigate these changes, medical billing companies like Wenour play a crucial role in ensuring accurate and efficient billing for preventive services. Wenour specializes in staying up-to-date with the latest CMS reimbursement rates by CPT code, helping healthcare providers optimize their billing processes and maximize reimbursements for preventive care services.

Wenour’s expertise in Medicare Part B billing and familiarity with CPT and HCPCS codes allows healthcare providers to focus on delivering quality care while ensuring proper reimbursement for preventive services. Their services are particularly valuable as providers adapt to the new coverage guidelines for Hepatitis B vaccinations and colorectal cancer screenings.

These proposed changes to preventive services coverage demonstrate CMS’s commitment to improving healthcare outcomes through early detection and prevention. By expanding access to critical screenings and vaccinations, the 2025 Medicare Physician Fee Schedule aims to reduce the burden of chronic diseases and improve overall population health.

Revisions to Drug Pricing and Reimbursement

Medicare Prescription Drug Inflation Rebate Program

The Centers for Medicare & Medicaid Services (CMS) has proposed significant changes to drug pricing and reimbursement in the 2025 Medicare Physician Fee Schedule. One of the key components is the Medicare Prescription Drug Inflation Rebate Program, which aims to address rising drug costs and improve affordability for beneficiaries.

Under this program, drug companies are required to pay rebates if they raise prices for certain Part B and Part D drugs faster than the rate of inflation. This measure is designed to discourage excessive price increases and ensure long-term sustainability of the Medicare program. The rebates paid by drug companies will be deposited in the Federal Supplementary Medical Insurance Trust Fund, contributing to the program’s financial stability.

Starting April 1, 2023, Medicare beneficiaries began seeing lower out-of-pocket costs for specific Part B drugs and biologicals with prices that have increased faster than the rate of inflation. For these medications, the beneficiary coinsurance is set at 20% of the inflation-adjusted payment amount, which is less than what they would pay otherwise.

Payment for Radiopharmaceuticals

CMS has proposed a significant change in the payment policy for radiopharmaceuticals furnished in physician offices. The agency plans to codify that Medicare Administrative Contractors (MACs) can determine payment limits using methodologies that were in place on or before November 2003. This change aims to address the unique challenges associated with radiopharmaceutical reimbursement and ensure appropriate payment for these specialized diagnostic tools.

Furthermore, CMS has proposed establishing a separate payment for diagnostic radiopharmaceuticals that meet a specific cost threshold, aligning with how other drugs and biologics are reimbursed. This proposal, if finalized, could substantially increase certain reimbursement rates, potentially improving beneficiary access to critical diagnostic and treatment services.

Blood Clotting Factors and Gene Therapies

In response to recent FDA approvals of gene therapies for hemophilia treatment, CMS has proposed updating regulatory text to clarify eligibility for the clotting factor furnishing fee. The agency proposes that blood clotting factors must be self-administered to qualify for the furnishing fee under existing CMS policy. This clarification is crucial as gene therapies for hemophilia are not eligible for a clotting factor furnishing fee because they are physician-administered drugs.

These proposed changes demonstrate CMS’s commitment to adapting reimbursement policies to accommodate innovative treatments while ensuring appropriate payment for essential therapies. As the healthcare landscape evolves, particularly with the advent of gene therapies, CMS continues to refine its reimbursement strategies to balance patient access, cost containment, and support for medical innovation.

Wenour, a leading medical billing company, specializes in navigating these complex reimbursement changes. Our expertise in CMS reimbursement rates by CPT code allows healthcare providers to optimize their billing processes and ensure compliance with the latest Medicare Part B payment policies.

Updates to Rural Health Clinics and Federally Qualified Health Centers

The Centers for Medicare & Medicaid Services (CMS) has proposed significant changes to Rural Health Clinics (RHCs) and Federally Qualified Health Centers (FQHCs) in the 2025 Medicare Physician Fee Schedule. These updates aim to increase flexibility, decrease burden for providers, and improve access to services for patients.

Changes to Conditions for Coverage

CMS is proposing to modify the RHC Conditions for Certification and the FQHC Conditions for Coverage. The agency plans to explicitly require that RHCs and FQHCs provide primary care services rather than being ‘primarily engaged’ in furnishing these services. This proposal aligns more closely with the intent of the statute while preserving access to primary care services in communities served by these facilities, particularly in rural areas.

Additionally, CMS proposes to remove hemoglobin and hematocrit tests from the list of required laboratory services that RHCs must provide directly. This change addresses concerns about outdated requirements and aims to reduce duplicative and expensive equipment in RHCs, especially those in close proximity to parent hospitals.

Payment for Preventive Vaccine Costs

In response to cash flow challenges faced by RHCs and FQHCs, CMS proposes allowing these facilities to bill and be paid for Part B preventive vaccines and their administration at the time of service. Payments for these claims will be made according to Part B preventive vaccine payment rates in other settings, to be annually reconciled with the facilities’ actual vaccine costs on their cost reports.

This change is set to take effect for dates of service beginning on or after July 1, 2025. The proposal aims to improve the timeliness of payment for critical preventive vaccine administration in RHCs and FQHCs, addressing concerns about the wait time between purchasing and administering vaccines and cost report settlement.

Wenour’s RHC and FQHC Billing Services

As healthcare providers navigate these changes, medical billing companies like Wenour play a crucial role in ensuring accurate and efficient billing for RHCs and FQHCs. Wenour specializes in staying up-to-date with the latest CMS reimbursement rates by CPT code, helping these facilities optimize their billing processes and maximize reimbursements for preventive care services and other billable items.

Wenour’s expertise in Medicare Part B billing and familiarity with CPT and HCPCS codes allows RHCs and FQHCs to focus on delivering quality care while ensuring proper reimbursement for their services. Their services are particularly valuable as providers adapt to the new billing requirements for preventive vaccines and other proposed changes in the 2025 Medicare Physician Fee Schedule.

These proposed updates demonstrate CMS’s commitment to improving healthcare outcomes and access in rural and underserved areas. By addressing long-standing concerns and modernizing requirements, the 2025 Medicare Physician Fee Schedule aims to support RHCs and FQHCs in their mission to provide essential primary care and preventive health services to their communities.

Proposals for Behavioral Health Services

The Centers for Medicare & Medicaid Services (CMS) has introduced several significant proposals for behavioral health services in the 2025 Medicare Physician Fee Schedule. These changes aim to improve access to mental health care and address the growing need for comprehensive behavioral health services.

New Codes for Safety Planning Interventions

CMS proposes to establish separate coding and payment under the Physician Fee Schedule for safety planning interventions for patients in crisis, including those with suicidal ideation or at risk of suicide or overdose. The agency plans to create an add-on G-code that would be billed alongside an evaluation and management (E/M) visit or psychotherapy service when safety planning interventions are personally performed by the billing practitioner in various settings.

This new code would allow providers to bill Medicare for crisis interventions, potentially increasing access to critical mental health services for Medicare beneficiaries. The proposal demonstrates CMS’s commitment to addressing the urgent need for crisis intervention services and improving reimbursement rates for these essential behavioral health services.

Digital Mental Health Treatment Devices

To support access to psychotherapy, CMS proposes Medicare payment for digital mental health treatment (DMHT) devices furnished incident to or integral to professional behavioral health services. These devices would be used in conjunction with ongoing behavioral health care treatment under a behavioral health treatment plan of care.

CMS plans to create three new HCPCS codes for DMHT devices:

1. GMBT1: Supply of digital mental health treatment device and initial education and onboarding per course of treatment.
2. GMBT2: First 20 minutes of monthly treatment management services.
3. GMBT3: Each additional 20 minutes of monthly treatment management services.

These codes would only apply to technologies and products approved by the Food and Drug Administration (FDA), ensuring the safety and efficacy of digital mental health interventions. This proposal reflects CMS’s recognition of the growing role of digital therapeutics in behavioral health care and its efforts to align reimbursement rates with innovative treatment modalities.

Opioid Treatment Program Updates

CMS proposes several telecommunication technology flexibilities for opioid use disorder (OUD) treatment services furnished by Opioid Treatment Programs (OTPs). These proposals aim to increase access to OUD treatment while ensuring compliance with Substance Abuse and Mental Health Services Administration (SAMHSA) and Drug Enforcement Administration (DEA) requirements.

Key proposals include:

1. Making permanent the current flexibility for furnishing periodic assessments via audio-only telecommunications beginning January 1, 2025.
2. Allowing the OTP intake add-on code to be furnished via two-way audio-video communications technology when initiating treatment with methadone.
3. Establishing payments for Social Determinants of Health risk assessments in OTPs.
4. Creating new payment codes for FDA-approved medications for OUD treatment and suspected opioid overdose.

These proposals demonstrate CMS’s commitment to addressing the opioid crisis by improving access to treatment and expanding the range of services covered under Medicare Part B. By updating reimbursement rates and CPT codes for OUD treatment, CMS aims to support healthcare providers in delivering comprehensive care to individuals struggling with opioid addiction.

Conclusion

The 2025 Medicare Physician Fee Schedule brings significant changes to the healthcare landscape, with far-reaching implications for providers and patients alike. These updates have an impact on various aspects of healthcare delivery, from preventive services to drug pricing and behavioral health. The proposed revisions aim to improve access to care, address rising costs, and support innovative treatment modalities, reflecting CMS’s commitment to adapting to the evolving needs of the healthcare system.

As healthcare providers navigate these changes, staying informed and adapting billing practices will be crucial to ensure proper reimbursement and compliance. The proposed schedule underscores the importance of efficient medical billing services to optimize revenue cycles in this dynamic environment. Explore Wenour Medical Billing Services to streamline your billing processes and maximize reimbursements under the new fee schedule. In the end, these updates seek to enhance the quality and accessibility of healthcare services for Medicare beneficiaries while supporting healthcare providers in delivering effective, patient-centered care.

FAQs

What will the payment rates be for Medicare physicians in 2025?
In 2025, the Centers for Medicare & Medicaid Services (CMS) has proposed a Medicare physician fee schedule with a conversion factor of USD 32.36. This represents a 2.8% decrease from the 2024 rates.

Can you explain the proposed physician fee schedule for 2025?
For the calendar year 2025, the physician fee schedule proposes a reduction in average payment rates by approximately 2.93% compared to what most services are currently paid in 2024.

What are the key changes in the CMS payment policy for 2025?
The 2025 proposal from CMS includes several significant updates and changes, such as reduced average payment rates under the Medicare Physician Fee Schedule, updates to telehealth policies, the introduction of a new category of care management services, among others.

What is the conversion factor set by CMS for the year 2025?
For the year 2025, CMS has set the conversion factor at USD 32.35 for the Medicare Physician Fee Schedule, which is about 2.8% lower than the current factor of USD 33.28.