Medicare 2021 Proposed Physician Fee Schedule and OPPS Rules

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  • October 26, 2020


On August 4, 2020, the Centers for Medicare and Medicaid Services (CMS) released the proposed 2021 Medicare Physician Fee Schedule (PFS), and Hospital Outpatient Prospective Payment System (OPPS) rules. Below are some of the highlights of the rules.


Under the PFS proposed rule, physicians would see a reduced conversion factor (CF) from $36.09 in 2020, to $32.26, effective Jan. 1, 2021.

Table 90 of the proposed PFS rule shows the estimated impact on total allowed charges by specialty. If the rule is finalized as proposed, CMS estimates the following payment rate changes:

  • Hematology/Oncology +14%
  • Radiation Oncology and Radiation Therapy -6%,
  • Rheumatology +16%
  • Physician Assistants +8%
  • Nurse Practitioners +8%

The PFS proposed 2021 rule includes changes to previously finalized billing and coding requirements for office and outpatient visits by incorporating revisions recommended by the American Medical Association (AMA). Among the proposed changes:

  • CMS will not implement a blended rate for level 2-4 evaluation and management (E/M) visits, and instead will continue to pay for each level of visit.
  • Adoption of revised E/M code definitions developed by the AMA CPT Editorial Panel starting Jan. 1, 2021.
  • Adoption of revised and increased work RVUs for E/M services based on recommendations from the AMA Relative Value Scale Update Committee (RUC).
  • Changes to prolonged services billing time when billed with the level 5 office/outpatient visit level so that CPT code 99XXX could be reported when the maximum time for the level 5 office/outpatient E/M visit is exceeded by at least 15 minutes on the date of service.

The proposed rule also expands and extends certain telehealth services including home visits for the evaluation and management of a patient (in the case where the law allows telehealth services in the patient’s home). However, CMS states that while they are not proposing to continue payment for audio-only E/M visits they are seeking input on audio only visits.  CMS also proposes adding additional services to the Medicare telehealth list on a Category 1 basis including Prolonged Services (99XXX) and Visit Complexity Associated with Certain Office/Outpatient E/Ms (GPC1X).

The rule addresses professional scope of practice and related issues. Scope of practice proposed changes and clarifications include:

  • To amend the basic rule under the regulation at § 410.32(b)(1) to allow NPs, CNSs, PAs or CNMs to supervise diagnostic tests on a permanent basis as allowed by state law and scope of practice.
  • Pharmacists may provide services incident to the services, and under the appropriate level of supervision, of the billing physician or NPP, if payment for the services is not made under the Medicare Part D benefit. This includes providing the services incident to the services of the billing physician or NPP and in accordance with the pharmacist’s state scope of practice and applicable state law.

Public comments on the proposed rule were due by Oct. 5.


CMS proposed increasing OPPS rates by 2.6% in 2021 with estimated total payments to OPPS providers of $83.9 billion in 2021, up $7.5 billion from 2020.

CMS is proposing to further reduce the payment rate for 340B drugs. Under the proposed rule, CMS would pay hospitals ASP minus 34.7% with a 6% add-on payment for overhead and handling, for a net rate of ASP minus 28.7%. CMS is also soliciting comments on whether they should instead continue its current policy of paying ASP minus 22.5%.

With either policy, rural sole community hospitals, children’s hospitals, and PPS-exempt cancer hospitals would continue to be excepted and would receive ASP plus 6% for 340B drugs.
Public comments on the proposed rule are due by Oct. 5.

This is a very broad summary of some of the provisions in the calendar-year 2021 proposed rules. We will provide a detailed look at the CY 2021 proposed rules in the next Oplinc Best Practices Review Newsletter sponsored by Genentech. In the meantime, below are links to the Medicare proposed rules and associated Fact Sheets.

CY 2021 Medicare Proposed Rules – Resources:

CMS Physician Fee Schedule Proposed Rule: Understanding 4 Key Topics Listening Session at:

Fact Sheet on the CY 2021 Physician Fee Schedule Proposed and Quality Payment Program Proposed Rule:

CMS Press Release on Expansion of Telehealth Benefits

Fact Sheet on the CY 2021 Quality Payment Program Proposed Rule:

Access the 2021 Medicare Physician Fee Schedule Proposed Rule at:

Access the 2021 Medicare Hospital Outpatient Prospective Payment System (OPPS) Proposed Rule at:

Fact Sheet on the CY 2021 Medicare Hospital Outpatient Prospective Payment System and Ambulatory Surgical Center Payment System Proposed Rule:


Oplinc wants to thank Genentech for their sponsorship of Oplinc’s Best Practices Review Newsletter in 2020. Access the latest Best Practices Review Newsletter and the archived newsletters at: under the Publications tab.

This newsletter is intended for informational purposes only. Information is provided for reference only and is not intended to provide reimbursement or legal advice. Laws, regulations, and policies concerning reimbursement are complex, are updated frequently, and should be verified by the user. Please consult your legal counsel or reimbursement specialist for any reimbursement or billing questions.