42 CFR Part 414 — Payment for Part B Medical and Other Health Services

PART 414—PAYMENT FOR PART B MEDICAL AND OTHER HEALTH SERVICES Authority: 42 U.S.C. 1302, 1395hh, and 1395rr(b)(l). Source: 55 FR 23441, June 8, 1990, unless otherwise noted. Editorial Note: Nomenclature changes to part 414 appear at 60 FR 50442, Sept. 29, 1995, and 60 FR 53877, Oct. 18, 1995. Subpart A—General Provisions § 414.1 Basis and scope. This part implements the following provisions of the Act: 1802—Rules for private contracts by Medicare beneficiaries. 1833—Rules for payment for most Part B services. 1834(a) and (h)—Amounts and frequency of payments for durable medical equipment and for prosthetic devices and orthotics and prosthetics. 1834(l)—Establishment of a fee schedule for ambulance services. 1834(m)—Rules for Medicare reimbursement for telehealth services. 1834A—Improving policies for clinical diagnostic laboratory tests 1842(o)—Rules for payment of certain drugs and biologicals. 1847(a) and (b)—Competitive bidding for certain durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS). 1848—Fee schedule for physician services. 1881(b)—Rules for payment for services to ESRD beneficiaries. 1887—Payment of charges for physician services to patients in providers. [67 FR 9132, Feb. 27, 2002, as amended at 69 FR 1116, Jan. 7, 2004; 71 FR 48409, Aug. 18, 2006; 81 FR 41098, June 23, 2016; 90 FR 20808, May 16, 2025] § 414.2 Definitions. As used in this part, unless the context indicates otherwise— AA AHPB CF CRNA CY FY GAF GPCI HCPCS Health Professional Shortage Area Major surgical procedure Physician services (1) Professional services of doctors of medicine and osteopathy (including osteopathic practitioners), doctors of optometry, doctors of podiatry, doctors of dental surgery and dental medicine, and chiropractors. (2) Supplies and services covered “incident to” physician services (excluding drugs as specified in § 414.36). (3) Outpatient physical and occupational therapy services if furnished by a person or an entity that is not a Medicare provider of services as defined in § 400.202 of this chapter. (4) Diagnostic x-ray tests and other diagnostic tests (excluding diagnostic laboratory tests paid under the fee schedule established under section 1833(h) of the Act). (5) X-ray, radium, and radioactive isotope therapy, including materials and services of technicians. (6) Antigens, as described in section 1861(s)(2)(G) of the Act. (7) Bone mass measurement. RVU (8) Screening mammography services. [56 FR 59624, Nov. 25, 1991, as amended at 57 FR 42492, Sept. 15, 1992; 58 FR 63686, Dec. 2, 1993; 59 FR 63463, Dec. 8, 1994; 60 FR 63177, Dec. 8, 1995; 63 FR 34328, June 24, 1998; 66 FR 55322, Nov. 1, 2001; 75 FR 73616, Nov. 29, 2010] § 414.4 Fee schedule areas. (a) General. (b) Changes. Federal Register Federal Register. [59 FR 63463, Dec. 8, 1994] § 414.5 Hospital services paid under Medicare Part B when a Part A hospital inpatient claim is denied because the inpatient admission was not reasonable and necessary, but hospital outpatient services would have been reasonable and necessary in treating the beneficiary. (a) If a Medicare Part A claim for inpatient hospital services is denied because the inpatient admission was not reasonable and necessary, or if a hospital determines under § 482.30(d) of this chapter or § 485.641 of this chapter after a beneficiary is discharged that the beneficiary's inpatient admission was not reasonable and necessary, the hospital may be paid for any of the following Part B inpatient services that would have been reasonable and necessary if the beneficiary had been treated as a hospital outpatient rather than admitted as an inpatient, provided the beneficiary is enrolled in Medicare Part B: (1) Services described in § 419.21(a) of this chapter that do not require an outpatient status. (2) Physical therapy services, speech-language pathology services, and occupational therapy services. (3) Ambulance services, as described in section 1861(v)(1)(U) of the Act, or, if applicable, the fee schedule established under section 1834(l) of Act. (4) Except as provided in § 419.2(b)(11) of this chapter, prosthetic devices, prosthetics, prosthetic supplies, and orthotic devices. (5) Except as provided in § 419.2(b)(10) of this chapter, durable medical equipment supplied by the hospital for the patient to take home. (6) Clinical diagnostic laboratory services. (7)(i) Effective December 8, 2003, screening mammography services; and (ii) Effective January 1, 2005, diagnostic mammography services. (8) Effective January 1, 2011, annual wellness visit providing personalized prevention plan services as defined in § 410.15 of this chapter. (b) If a Medicare Part A claim for inpatient hospital services is denied because the inpatient admission was not reasonable and necessary, or if a hospital determines under § 482.30(d) of this chapter or § 485.641 of this chapter after a beneficiary is discharged that the beneficiary's inpatient admission was not reasonable and necessary, the hospital may be paid for hospital outpatient services described in § 412.2(c)(5), § 412.405, § 412.540, or § 412.604(f) of this chapter or § 413.40(c)(2) of this chapter that are furnished to the beneficiary prior to the point of inpatient admission (that is, the inpatient admission order). (c) The claims for the Part B services filed under the circumstances described in this section must be filed in accordance with the time limits for filing claims specified in § 424.44(a) of this chapter. [78 FR 50968, Aug. 19, 2013] Subpart B—Physicians and Other Practitioners Source: 56 FR 59624, Nov. 25, 1991; 57 FR 42492, Sept. 15, 1992, unless otherwise noted. § 414.20 Formula for computing fee schedule amounts. (a) Participating supplier. (1) The RVUs for the service. (2) The GAF for the fee schedule area. (3) The CF. (b) Nonparticipating supplier. [62 FR 59101, Oct. 31, 1997] § 414.21 Medicare payment basis. Medicare payment is based on the lesser of the actual charge or the applicable fee schedule amount. [62 FR 59101, Oct. 31, 1997] § 414.22 Relative value units (RVUs). CMS establishes RVUs for physicians' work, practice expense, and malpractice insurance. (a) Physician work RVUs General rule. (2) Special RVUs for anesthesia and radiology services) Anesthesia services. (ii) Radiology services. (b) Practice expense RVUs. (2) The average practice expense percentage for a service or class of services is computed as follows: (i) Multiply the average practice expense percentage for each specialty by the proportion of a particular service or class of service performed by that specialty. (ii) Add the products for all specialties. (3) For services furnished beginning calendar year (CY) 1994, for which 1994 practice expense RVUs exceed 1994 work RVUs and that are performed in office settings less than 75 percent of the time, the 1994, 1995, and 1996 practice expense RVUs are reduced by 25 percent of the amount by which they exceed the number of 1994 work RVUs. Practice expense RVUs are not reduced to less than 128 percent of 1994 work RVUs. (4) For services furnished beginning January 1, 1998, practice expense RVUs for certain services are reduced to 110 percent of the work RVUs for those services. The following two categories of services are excluded from this limitation: (i) The service is provided more than 75 percent of the time in an office setting; or (ii) The service is one described in section 1848(c)(2)(G)(v) of the Act, codified at 42 U.S.C. 1395w-4(c)(2)(G). Section 1848(c)(2)(G)(v) of the Act refers to the 1998 proposed resource-based practice expense RVUs (as specified in the June 18, 1997 physician fee schedule proposed rule (62 FR 33158)) for the specific site, either in-office or out-of-office, increased from its 1997 practice expense RVUs.) (5) For services furnished in 2002 and subsequent years, the practice expense RVUs are based entirely on relative practice expense resources. (i) Usually there are two levels of practice expense RVUs that correspond to each code. (A) Facility practice expense RVUs. (B) Nonfacility practice expense RVUs. (C) Outpatient therapy and CORF services. (ii) [Reserved] (6)(i) CMS establishes criteria for supplemental surveys regarding specialty practice expenses submitted to CMS that may be used in determining practice expense RVUs. (ii) Any CMS-designated specialty group may submit a supplemental survey. (iii) CMS will consider for use in determining practice expense RVUs for the physician fee schedule survey data and related materials submitted to CMS by March 1, 2004 to determine CY 2005 practice expense RVUs and by March 1, 2005 to determine CY 2006 practice expense RVUs. (c) Malpractice insurance RVUs. (2) The average historical malpractice insurance percentage for a service or class of services is computed as follows: (i) Multiply the average malpractice insurance percentage for each specialty by the proportion of a particular service or class of services performed by that specialty. (ii) Add all the products for all the specialties. (3) For services furnished in the year 2000 and subsequent years, the malpractice RVUs are based on the relative malpractice insurance resources. [56 FR 59624, Nov. 25, 1991, as amended at 57 FR 42493, Sept. 15, 1992; 58 FR 63687, Dec. 2, 1993; 62 FR 59102, Oct. 31, 1997; 63 FR 58910, Nov. 2, 1998; 64 FR 59441, Nov. 2, 1999; 65 FR 25668, May 3, 2000; 65 FR 65440, Nov. 1, 2000; 67 FR 43558, June 28, 2002; 68 FR 63261, Nov. 7, 2003; 72 FR 66932, Nov. 27, 2007; 73 FR 69935, Nov. 19, 2008; 76 FR 73471, Nov. 28, 2011; 81 FR 79879, Nov. 14, 2016; 81 FR 80553, Nov. 15, 2016] § 414.24 Publication of RVUs and direct PE inputs. (a) Definitions. Existing code New code (b) Revisions of RVUs and Direct PE Inputs. Federal Register (c) Establishing RVUs and Direct PE inputs for new codes General rule. (2) Exception for new codes for which CMS does not have sufficient information. Federal Register Federal Register (d) Values for local codes (HCPCS Level 3). (2) Carriers must obtain prior approval from CMS to establish local codes for services that meet the definition of “physician services” in § 414.2. [56 FR 59624, Nov. 25, 1991, as amended at 57 FR 42492, Sept. 15, 1992; 79 FR 68003, Nov. 13, 2014] § 414.26 Determining the GAF. CMS establishes a GAF for each service in each fee schedule area. (a) Geographic indices. (1) An index that reflects one-fourth of the difference between the relative value of physicians' work effort in each of the different fee schedule areas as determined under § 414.22(a) and the national average of that work effort. (2) An index that reflects the relative costs of the mix of goods and services comprising practice expenses (other than malpractice expenses) in each of the different fee schedule areas as determined under § 414.22(b) compared to the national average of those costs. (3) An index that reflects the relative costs of malpractice expenses in each of the different fee schedule areas as determined under § 414.22(c) compared to the national average of those costs. (b) Class-specific practice cost indices. (c) Adjusting the practice expense index to account for the Frontier State floor General criteria. (i) At least 50 percent of counties located within the State have a population density less than 6 persons per square mile. (ii) The State does not receive a non-labor related share adjustment determined by the Secretary to take into account the unique circumstances of hospitals located in Alaska and Hawaii. (2) Amount of adjustment. (3) Process for determining adjustment. (ii) CMS will publish annually a listing of qualifying Frontier States receiving a practice expense index floor attributable to this provision. (d) Computation of GAF. (1) The geographic physicians' work adjustment factor for a service is the product of the proportion of the total relative value for the service that reflects the RVUs for the work component and the geographic physicians' work index value established under paragraph (a)(1) of this section. (2) The geographic practice expense adjustment factor for a service is the product of the proportion of the total relative value for the service that reflects the RVUs for the practice expense component, multiplied by the geographic practice cost index (GPCI) value established under paragraph (a)(2) of this section. (3) The geographic malpractice adjustment factor for a service is the product of the proportion of the total relative value for the service that reflects the RVUs for the malpractice component, multiplied by the GPCI value established under paragraph (a)(3) of this section. [56 FR 59624, Nov. 25, 1991, as amended at 57 FR 42492, Sept. 15, 1992; 75 FR 73616, Nov. 29, 2010] § 414.28 Conversion factors. CMS establishes CFs in accordance with section 1848(d) of the Act. (a) Base-year CFs. (b) Subsequent CFs. [56 FR 59624, Nov. 25, 1991, as amended at 57 FR 42492, Sept. 15, 1992; 60 FR 53877, Oct. 18, 1995; 60 FR 63177, Dec. 8, 1995] § 414.30 Conversion factor update. Unless Congress acts in accordance with section 1848(d)(3) of the Act— (a) General rule. (b) Downward adjustment. (1) For CYs 1992 and 1993, 2 percentage points. (2) For CY 1994, 2.5 percentage points. (3) For CYs 1995 and thereafter, 5 percentage points. [55 FR 23441, June 8, 1990, as amended at 60 FR 63177, Dec. 8, 1995; 61 FR 42385, Aug. 15, 1996] § 414.34 Payment for services and supplies incident to a physician's service. (a) Medical supplies. (2) If physician services of the type routinely furnished in provider settings are furnished in a physician's office, separate payment may be made for certain supplies furnished incident to that physician service if the following requirements are met: (i) It is a procedure that can safely be furnished in the office setting in appropriate circumstances. (ii) It requires specialized supplies that are not routinely available in physicians' offices and that are generally disposable. (iii) It is furnished before January 1, 1999. (3) For the purpose of paragraph (a)(2) of this section, provider settings include only the following settings: (i) Hospital inpatient and outpatient departments. (ii) Ambulatory surgical centers. (4) For the purpose of paragraph (a)(2) of this section, “routinely furnished in provider settings” means furnished in inpatient or outpatient hospital settings or ambulatory surgical centers more than 50 percent of the time. (5) CMS establishes a list of services for which a separate supply payment may be made under this section. (6) The fee schedule amount for supplies billed separately is not subject to a GPCI adjustment. (b) Services of nonphysicians that are incident to a physician's service. [56 FR 59624, Nov. 25, 1991; 57 FR 42492, Sept. 15, 1992, as amended at 63 FR 58911, Nov. 2, 1998] § 414.36 Payment for drugs incident to a physician's service. Payment for drugs incident to a physician's service is made in accordance with § 405.517 of this chapter. § 414.39 Special rules for payment of care plan oversight. (a) General. (b) Exception. (1) The care plan oversight services require recurrent physician supervision of therapy involving 30 or more minutes of the physician's time per month. (2) Payment is made to only one physician per patient for services furnished during a calendar month period. The physician must have furnished a service requiring a face-to-face encounter with the patient at least once during the 6-month period before the month for which care plan oversight payment is first billed. The physician may not have a significant ownership interest in, or financial or contractual relationship with, the HHA in accordance with § 424.22(d) of this chapter. The physician may not be the medical director or employee of the hospice and may not furnish services under an arrangement with the hospice. (3) If a physician furnishes care plan oversight services during a postoperative period, payment for care plan oversight services is made if the services are documented in the patient's medical record as unrelated to the surgery. (c) Special rules for payment of care plan oversight provided by nonphysician practitioners for beneficiaries who receive HHA services covered by Medicare. (i) The physician and NPP are part of the same group practice; or (ii) If the NPP is a nurse practitioner or clinical nurse specialist, the physician signing the plan of care also has a collaborative agreement with the NPP; or (iii) If the NPP is a physician assistant, the physician signing the plan of care is also the physician who provides general supervision of physician assistant services for the practice. (2) Payment may be made for care plan oversight services furnished by an NPP when: (i) The NPP providing the care plan oversight has seen and examined the patient; (ii) The NPP providing care plan oversight is not functioning as a consultant whose participation is limited to a single medical condition rather than multi-disciplinary coordination of care; and (iii) The NPP providing care plan oversight integrates his or her care with that of the physician who signed the plan of care. [59 FR 63463, Dec. 8, 1994; 60 FR 49, Jan. 3, 1995; 60 FR 36733, July 18, 1995, as amended at 69 FR 66423, Nov. 15, 2004; 70 FR 16722, Apr. 1, 2005] § 414.40 Coding and ancillary policies. (a) General rule. (b) Specific types of policies. (1) Global surgery policy (for example, post- and pre-operative periods and services, and intra-operative services). (2) Professional and technical components (for example, payment for services, such as an EEG, which typically comprise a technical component (the taking of the test) and a professional component (the interpretation)). (3) Payment modifiers (for example, assistant-at-surgery, multiple surgery, bilateral surgery, split surgical global services, team surgery, and unusual services). § 414.42 Adjustment for first 4 years of practice. (a) General rule. (b) Exception. (c) Definition of years of practice. (2) The “second, third, and fourth years of practice“ are the first, second, and third CYs following the first year of practice, respectively. (d) Amounts of adjustment. (1) First year—80 percent (2) Second year—85 percent (3) Third year—90 percent (4) Fourth year—95 percent [57 FR 42493, Sept. 15, 1992, as amended at 58 FR 63687, Dec. 2, 1993] § 414.44 Transition rules. (a) Adjusted historical payment basis All services other than radiology and nuclear medicine services. (2) Radiology services. (3) Nuclear medicine services. (4) Transition adjustment. (b) Adjustment of 1992 payments for physician services other than radiology services. (1) If the AHPB determined under paragraph (a) of this section is from 85 percent to 115 percent of the fee schedule amount for the area for services furnished in 1992, payment is at the fee schedule amount. (2) If the AHPB determined under paragraph (a) of this section is less than 85 percent of the fee schedule amount for the area for services furnished in 1992, an amount equal to the AHPB plus 15 percent of the fee schedule amount is substituted for the fee schedule amount. (3) If the AHPB determined under paragraph (a) of this section is greater than 115 percent of the fee schedule amount for the area for services furnished in 1992, an amount equal to the AHPB minus 15 percent of the fee schedule amount is substituted for the fee schedule amount. (c) Adjustment of 1992 payments for radiology services. (1) If the AHPB determined under paragraph (a) of this section is from 85 percent to 109 percent of the fee schedule amount for the area for services furnished in 1992, payment is at the fee schedule amount. (2) If the AHPB determined under paragraph (a) of this section is less than 85 percent of the fee schedule amount for the area for services furnished in 1992, an amount equal to the AHPB plus 15 percent of the fee schedule amount is substituted for the fee schedule amount. (3) If the AHPB determined under paragraph (a) of this section is greater than 109 percent of the fee schedule amount for the area for services furnished in 1992, an amount equal to the AHPB minus 9 percent of the fee schedule amount is substituted for the fee schedule amount. (d) Computation of payments for CY 1993. (e) Computation of payments for CY 1994. (f) Computation of payments for CY 1995. § 414.46 Additional rules for payment of anesthesia services. (a) Definitions. (1) Base unit (2) Anesthesia practitioner, (3) Anesthesia time (b) Determinations of payment amount—Basic rule. (1) The carrier bases the fee schedule amount for an anesthesia service on the product of the sum of allowable base and time units and an anesthesia-specific CF. The carrier calculates the time units from the anesthesia time reported by the anesthesia practitioner for the anesthesia procedure. The physician who fulfills the conditions for medical direction in § 415.110 (Conditions for payment: Anesthesiology services) reports the same anesthesia time as the medically-directed CRNA. (2) CMS furnishes the carrier with the base units for each anesthesia procedure code. The base units are derived from the 1988 American Society of Anesthesiologists' Relative Value Guide except that the number of base units recognized for anesthesia services furnished during cataract or iridectomy surgery is four units. (3) Modifier units are not allowed. Modifier units include additional units charged by a physician or a CRNA for patient health status, risk, age, or unusual circumstances. (c) Physician personally performs the anesthesia procedure. (i) The physician performs the entire anesthesia service alone. (ii) The physician establishes an attending physician relationship in one or two concurrent cases involving an intern or resident and the service was furnished before January 1, 1994. (iii) The physician establishes an attending physician relationship in one case involving an intern or resident and the service was furnished on or after January 1, 1994 but prior to January 1, 1996. For services on or after January 1, 1996, the physician must be the teaching physician as defined in §§ 415.170 through 415.184 of this chapter. (iv) The physician and the CRNA or AA are involved in a single case and the services of each are found to be medically necessary. (v) The physician is continuously involved in a single case involving a student nurse anesthetist. (vi) The physician is continuously involved in a single case involving a CRNA or AA and the service was furnished prior to January 1, 1998. (2) CMS determines the fee schedule amount for an anesthesia service personally performed by a physician on the basis of an anesthesia-specific fee schedule CF and unreduced base units and anesthesia time units. One anesthesia time unit is equivalent to 15 minutes of anesthesia time, and fractions of a 15-minute period are recognized as fractions of an anesthesia time unit. (d) Anesthesia services medically directed by a physician. (i) The physician performs the activities described in § 415.110 of this chapter. (ii) The physician directs qualified individuals involved in two, three, or four concurrent cases. (iii) Medical direction can occur for a single case furnished on or after January 1, 1998 if the physician performs the activities described in § 415.110 of this chapter and medically directs a single CRNA or AA. (2) The rules for medical direction differ for certain time periods depending on the nature of the qualified individual who is directed by the physician. (i) If more than two procedures are directed on or after January 1, 1994, the qualified individuals could be AAs, CRNAs, interns, or residents. The medical direction rules apply to student nurse anesthetists only if the physician directs two concurrent cases, each of which involves a student nurse anesthetist or the physician directs one case involving a student nurse anesthetist and the other involving a CRNA, AA, intern, or resident. (ii) For services furnished on or after January 1, 2010, the medical direction rules do not apply to a single anesthesia resident case that is concurrent to another case which is paid under the medical direction payment rules as specified in paragraph (e) of this section. (3) Payment for medical direction is based on a specific percentage of the payment allowance recognized for the anesthesia service personally performed by a physician alone. The following percentages apply for the years specified: (i) CY 1994—60 percent of the payment allowance for personally performed procedures. (ii) CY 1995—57.5 percent of the payment allowance for personally performed services. (iii) CY 1996—55 percent of the payment allowance for personally performed services. (iv) CY 1997—52.5 percent of the payment allowance for personally performed services. (v) CY 1998 and thereafter—50 percent of the payment allowance for personally performed services. (e) Special payment rule for teaching anesthesiologist involved in a single resident case or two concurrent cases. (f) Physician medically supervises anesthesia services. (g) Payment for medical or surgical services furnished by a physician while furnishing anesthesia services. (2) CMS makes no separate payment for other medical or surgical services, such as the pre-anesthetic examination of the patient, pre- or post-operative visits, or usual monitoring functions, that are ordinarily included in the anesthesia service. (h) Physician involved in multiple anesthesia services. [56 FR 59624, Nov. 25, 1991, as amended at 57 FR 42492, Sept. 15, 1992; 58 FR 63687, Dec. 2, 1993; 60 FR 63177, Dec. 8, 1995; 64 FR 59441, Nov. 2, 1999; 67 FR 80041, Dec. 31, 2002; 68 FR 63261, Nov. 7, 2003; 74 FR 62006, Nov. 25, 2009] § 414.48 Limits on actual charges of nonparticipating suppliers. (a) General rule. (b) Specific limits. [58 FR 63687, Dec. 2, 1993, as amended at 62 FR 59102, Oct. 31, 1997] § 414.50 Physician or other supplier billing for diagnostic tests performed or interpreted by a physician who does not share a practice with the billing physician or other supplier. (a) General rules. (i) The performing supplier's net charge to the billing physician or other supplier. For purposes of this paragraph (a)(1) only, with respect to the TC, the performing supplier is the physician who supervised the TC, and with respect to the PC, the performing supplier is the physician who performed the PC. (ii) The billing physician or other supplier's actual charge. (iii) The fee schedule amount for the test that would be allowed if the performing supplier billed directly. (2) The following requirements are applicable for purposes of paragraph (a)(1) of this section: (i) The net charge must be determined without regard to any charge that is intended to reflect the cost of equipment or space leased to the performing supplier by or through the billing physician or other supplier. (ii) A performing physician shares a practice with the billing physician or other supplier if he or she furnishes substantially all (which, for purposes of this section, means “at least 75 percent”) of his or her professional services through such billing physician or other supplier. The “substantially all” requirement will be satisfied if, at the time the billing physician or other supplier submits a claim for a service furnished by the performing physician, the billing physician or other supplier has a reasonable belief that: (A) For the 12 months prior to and including the month in which the service was performed, the performing physician furnished substantially all of his or her professional services through the billing physician or other supplier; or (B) The performing physician will furnish substantially all of his or her professional services through the billing physician or other supplier for the next 12 months (including the month in which the service is performed). (iii) A physician will be deemed to share a practice with the billing physician or other supplier with respect to the performance of the TC or PC of a diagnostic test if the physician is an owner, employee or independent contractor of the billing physician or other supplier and the TC or PC is performed in the office of the billing physician or other supplier. The “office of the billing physician or other supplier” is any medical office space, regardless of number of locations, in which the ordering physician or other ordering supplier regularly furnishes patient care, and includes space where the billing physician or other supplier furnishes diagnostic testing, if the space is located in the same building (as defined in § 411.351) in which the ordering physician or other ordering supplier regularly furnishes patient care. With respect to a billing physician or other supplier that is a physician organization (as defined in § 411.351 of this chapter), the “office of the billing physician or other supplier” is space in which the ordering physician provides substantially the full range of patient care services that the ordering physician provides generally. The performance of the TC includes both the conducting of the TC as well as the supervision of the TC. (b) Restriction on payment. (2) Physicians and other suppliers that accept Medicare assignment may bill beneficiaries for only the applicable deductibles and coinsurance. (3) Physicians and other suppliers that do not accept Medicare assignment may not bill the beneficiary more than the payment amount described in paragraph (a) of this section. [72 FR 66400, Nov. 27, 2007, as amended at 73 FR 2432, Jan. 15, 2008; 73 FR 69935, Nov. 19, 2008] § 414.52 Payment for physician assistants' services. Allowed amounts for the services of a physician assistant furnished beginning January 1, 1992 and ending December 31, 1997, may not exceed the limits specified in paragraphs (a) through (c) of this section. Allowed amounts for the services of a physician assistant furnished beginning January 1, 1998, may not exceed the limits specified in paragraph (d) of this section. (a) For assistant-at-surgery services, 65 percent of the amount that would be allowed under the physician fee schedule if the assistant-at-surgery service was furnished by a physician. (b) For services (other than assistant-at-surgery services) furnished in a hospital, 75 percent of the physician fee schedule amount for the service. (c) For all other services, 85 percent of the physician fee schedule amount for the service. (d) For services (other than assistant-at-surgery services) furnished beginning January 1, 1998, 85 percent of the physician fee schedule amount for the service. For assistant-at-surgery services, 85 percent of the physician fee schedule amount that would be allowed under the physician fee schedule if the assistant-at-surgery service were furnished by a physician. [56 FR 59624, Nov. 25, 1991; 57 FR 42492, Sept. 15, 1992, as amended at 63 FR 58911, Nov. 2, 1998] § 414.53 Fee schedule for clinical social worker, marriage and family therapist, and mental health counselor services. The fee schedule for clinical social worker, marriage and family therapist, and mental health counselor services is set at 75 percent of the amount determined for clinical psychologist services under the physician fee schedule. [88 FR 79530, Nov. 16, 2023] § 414.54 Payment for certified nurse-midwives' services. (a) For services furnished after December 31, 1991, allowed amounts under the fee schedule established under section 1833(a)(1)(K) of the Act for the payment of certified nurse-midwife services may not exceed 65 percent of the physician fee schedule amount for the service. (b) For certified nurse-midwife services furnished on or after January 1, 2011, allowed amounts may not exceed 100 percent of the physician fee schedule amount that would be paid to a physician for the services. [75 FR 73616, Nov. 29, 2010] § 414.56 Payment for nurse practitioners' and clinical nurse specialists' services. (a) Rural areas. (1) For services furnished in a hospital (including assistant-at-surgery services), 75 percent of the physician fee schedule amount for the service. (2) For all other services, 85 percent of the physician fee schedule amount for the service. (b) Non-rural areas. (c) Beginning January 1, 1998. [63 FR 58911, Nov. 2, 1998] § 414.58 Payment of charges for physician services to patients in providers. (a) Payment under the physician fee schedule. (b) Teaching hospitals. [56 FR 59624, Nov. 25, 1991, as amended at 57 FR 42492, Sept. 15, 1992; 60 FR 63189, Dec. 8, 1995] § 414.60 Payment for the services of CRNAs. (a) Basis for payment. (1) The allowance for an anesthesia service furnished by a medically directed CRNA is based on a fixed percentage of the allowance recognized for the anesthesia service personally performed by the physician alone, as specified in § 414.46(d)(3); and (2) The CF for an anesthesia service furnished by a CRNA not directed by a physician may not exceed the CF for a service personally performed by a physician. (b) To whom payment may be made. (c) Condition for payment. [60 FR 63178, Dec. 8, 1995, as amended at 62 FR 46037, Aug. 29, 1997; 64 FR 59441, Nov. 2, 1999; 77 FR 69363, Nov. 16, 2012] § 414.61 Payment for anesthesia services furnished by a teaching CRNA. (a) Basis for payment. (1) The teaching CRNA, who is not under medical direction of a physician, is present with the student nurse anesthetist for the pre and post anesthesia services included in the anesthesia base units payment and is continuously present during anesthesia time in a single case with a student nurse anesthetist. (2) The teaching CRNA, who is not under the medical direction of a physician, is involved with two concurrent anesthesia cases with student nurse anesthetists. The teaching CRNA must be present with the student nurse anesthetist for the pre and post anesthesia services included in the anesthesia base unit. For the anesthesia time of the two concurrent cases, the teaching CRNA can only be involved with those two concurrent cases and may not perform services for other patients. (b) Level of payment. [74 FR 62006, Nov. 25, 2009] § 414.62 Fee schedule for clinical psychologist services. The fee schedule for clinical psychologist services is set at 100 percent of the amount determined for corresponding services under the physician fee schedule. [62 FR 59102, Oct. 31, 1997] § 414.63 Payment for outpatient diabetes self-management training. (a) Payment under the physician fee schedule. Except as provided in paragraph (d) of this section, payment for outpatient diabetes self-management training is made under the physician fee schedule in accordance with §§ 414.1 through 414.48. (b) To whom payment may be made. Payment may be made to an entity approved by CMS to furnish outpatient diabetes self-management training in accordance with part 410, subpart H of this chapter. (c) Limitation on payment. Payment may be made for training sessions actually attended by the beneficiary and documented on attendance sheets. (d) Payments made to those not paid under the physician fee schedule. Payments may be made to other entities not routinely paid under the physician fee schedule, such as hospital outpatient departments, ESRD facilities, and DME suppliers. The payment equals the amounts paid under the physician fee schedule. (e) Other conditions for fee-for-service payment. The beneficiary must meet the following conditions: (1) Has not previously received initial training for which Medicare payment was made under this benefit. (2) Is not receiving services as an inpatient in a hospital, SNF, hospice, or nursing home. (3) Is not receiving services as an outpatient in an RHC or FQHC. [65 FR 83153, Dec. 29, 2000] § 414.64 Payment for medical nutrition therapy. (a) Payment under the physician fee schedule (b) To whom payment may be made. (c) Effective date of payment. (d) Limitation on payment. (e) Other conditions for fee-for-service payment. (1) Is not an inpatient of a hospital, SNF, nursing home, or hospice. (2) Is not receiving services in an RHC, FQHC or ESRD dialysis facility. [66 FR 55332, Nov. 1, 2001, as amended at 86 FR 65668, Nov. 19, 2021] § 414.65 Payment for telehealth services. (a) Professional service. (1) Only the physician or practitioner at the distant site may bill and receive payment for the professional service via an interactive telecommunications system. (2) Payments made to the physician or practitioner at the distant site, including deductible and coinsurance, for the professional service may not be shared with the referring practitioner or telepresenter. (b) Originating site facility fee. (1) For services furnished on or after October 1, 2001 through December 31, 2002, the payment amount to the originating site is the lesser of the actual charge or the originating site facility fee of $20. For services furnished on or after January 1 of each subsequent year, the facility fee for the originating site will be updated by the Medicare Economic Index (MEI) as defined in section 1842(i)(3) of the Act. (2) Only the originating site may bill for the originating site facility fee and only on an assignment-related basis. The distant site physician or practitioner may not bill for or receive payment for facility fees associated with the professional service furnished via an interactive telecommunications system. (3) No originating site facility fee payment is made to an originating site described in § 410.78(b)(3)(x), (xi), or (xii); or to an originating site for services furnished under the exception at § 410.78(b)(4)(iv)(A) or (B) of this chapter. (c) Deductible and coinsurance apply. (d) Assignment required for physicians, practitioners, and originating sites. (e) Sanctions. (1) Knowingly and willfully bills or collects for services in violation of the limitation of this section. (2) Fails to timely correct excess charges by reducing the actual charge billed for the service in an amount that does not exceed the limiting charge for the service or fails to timely refund excess collections. (3) Fails to submit a claim on a standard form for services provided for which payment is made on a fee schedule basis. (4) Imposes a charge for completing and submitting the standard claims form. [66 FR 55332, Nov. 1, 2001, as amended at 67 FR 80041, Dec. 31, 2003; 69 FR 66424, Nov. 15, 2004; 70 FR 70332, Nov. 21, 2005; 72 FR 66401, Nov. 27, 2007; 73 FR 69936, Nov. 19, 2008; 74 FR 62006, Nov. 25, 2009; 75 FR 73617, Nov. 29, 2010; 76 FR 73471, Nov. 28, 2011; 77 FR 69363, Nov. 16, 2012; 78 FR 74812, Dec. 10, 2013; 83 FR 60074, Nov. 23, 2018] § 414.66 Incentive payments for physician scarcity areas. (a) Definition. Physician scarcity area Primary care physician (b) Physicians' services furnished to a beneficiary in a Physician Scarcity Area (PSA) for primary or specialist care are eligible for a 5 percent incentive payment. (c) Primary care physicians furnishing services in primary care PSAs are entitled to an additional 5 percent incentive payment above the amount paid under the physician fee schedule for their professional services furnished on or after January 1, 2005 and before January 1, 2008. (d) Physicians, as defined in section 1861(r)(1) of the Act, furnishing services in specialist care PSAs are entitled to an additional 5 percent payment above the amount paid under the physician fee schedule for their professional services furnished on or after January 1, 2005 and before January 1, 2008. [69 FR 66424, Nov. 15, 2004] § 414.67 Incentive payments for services furnished in Health Professional Shortage Areas. (a) Health Professional Shortage Area (HPSA) physician bonus program. (1) HPSA bonuses are payable for services furnished by physicians as defined in section 1861(r) of the Act in areas designated as of December 31 of the prior year as geographic primary medical care HPSAs as defined in section 332(a)(1)(A) of the Public Health Service Act. (2) HPSA bonuses are payable for services furnished by psychiatrists in areas designated as of December 31 of the prior year as geographic mental health HPSAs if the services are not already eligible for the bonus based on being in a geographic primary care HPSA. (3) Physicians eligible for the HPSA physician bonus are entitled to a 10 percent incentive payment above the amount paid for their professional services under the physician fee schedule. (4) Physicians furnishing services in areas that are designated as geographic HPSAs prior to the beginning of the year but not included on the published list of zip codes for which automated HPSA bonus payments are made must use the AQ modifier to receive the HPSA physician bonus payment. (b) HPSA surgical incentive payment program. (1) A major surgical procedure as defined in § 414.2 of this part is furnished by a general surgeon on or after January 1, 2011 and before January 1, 2016 in an area recognized for the HPSA physician bonus program under paragraph (a)(1) of this section. (2) Payment will be made on a quarterly basis in an amount equal to 10 percent of the Part B payment amount for major surgical procedures furnished as described in paragraph (b)(1) of this section, in addition to the amount the physician would otherwise be paid. (3) Physicians furnishing services in areas that are designated as geographic HPSAs eligible for the HPSA physician bonus program under paragraph (a)(1) of this section prior to the beginning of the year but not included on the published list of zip codes for which automated HPSA surgical incentive payments are made should report HCPCS modifier -AQ to receive the HPSA surgical incentive payment. (4) The payment described in paragraph (b)(2) of this section is made to the surgeon or, where the surgeon has reassigned his or her benefits to a critical access hospital (CAH) paid under the optional method, to the CAH based on an institutional claim. [75 FR 73617, Nov. 29, 2010] § 414.68 Imaging accreditation. (a) Scope and purpose. (b) Definitions. Accredited supplier Advanced diagnostic imaging service (i) Magnetic resonance imaging. (ii) Computed tomography. (iii) Nuclear medicine. (iv) Positron emission tomography. CMS-approved accreditation organization (c) Application and reapplication procedures for accreditation organizations. (1) A detailed description of how the organization's accreditation criteria satisfy the statutory standards authorized by section 1834(e)(3) of the Act, specifically— (i) Qualifications of medical personnel who are not physicians and who furnish the TC of advanced diagnostic imaging services; (ii) Qualifications and responsibilities of medical directors and supervising physicians (who may be the same person), such as their training in advanced diagnostic imaging services in a residency program, expertise obtained through experience, or continuing medical education courses; (iii) Procedures to ensure the reliability, clarity, and accuracy of the technical quality of diagnostic images produced by the supplier, including a thorough evaluation of equipment performance and safety; (iv) Procedures to ensure the safety of persons who furnish the TC of advanced diagnostic imaging services and individuals to whom such services are furnished; (v) Procedures to assist the beneficiary in obtaining the beneficiary's imaging records on request; and (vi) Procedures to notify the accreditation organization of any changes to the modalities subsequent to the organization's accreditation decision. (2) An agreement to conform accreditation requirements to any changes in Medicare statutory requirements authorized by section 1834(e) of the Act. The accreditation organization must maintain or adopt standards that are equal to, or more stringent than, those of Medicare. (3) Information that demonstrates the accreditation organization's knowledge and experience in the advanced diagnostic imaging arena. (4) The organization's proposed fees for accreditation for each modality in which the organization intends to offer accreditation, including any plans for reducing the burden and cost of accreditation to small and rural suppliers. (5) Any specific documentation requirements and attestations requested by CMS as a condition of designation under this part. (6) A detailed description of the organization's survey process, including the following: (i) Type and frequency of the surveys performed. (ii) The ability of the organization to conduct timely reviews of accreditation applications, to include the organizations national capacity. (iii) Description of the organization's audit procedures, including random site visits, site audits, or other strategies for ensuring suppliers maintain compliance for the duration of accreditation. (iv) Procedures for performing unannounced site surveys. (v) Copies of the organization's survey forms. (vi) A description of the accreditation survey review process and the accreditation status decision-making process, including the process for addressing deficiencies identified with the accreditation requirements, and the procedures used to monitor the correction of deficiencies found during an accreditation survey. (vii) Procedures for coordinating surveys with another accrediting organization if the organization does not accredit all products the supplier provides. (viii) Detailed information about the individuals who perform evaluations for the accreditation organization, including all of the following information: (A) The number of professional and technical staff that are available for surveys. (B) The education, employment, and experience requirements surveyors must meet. (C) The content and length of the orientation program. (ix) The frequency and types of in-service training provided to survey personnel. (x) The evaluation systems used to monitor the performance of individual surveyors and survey teams. (xi) The policies and procedures regarding an individual's participation in the survey or accreditation decision process of any organization with which the individual is professionally or financially affiliated. (xii) The policies and procedures used when an organization has a dispute regarding survey findings or an adverse decision. (7) Detailed information about the size and composition of survey teams for each category of advanced medical imaging service supplier accredited. (8) A description of the organization's data management and analysis system for its surveys and accreditation decisions, including the kinds of reports, tables, and other displays generated by that system. (9) The organization's procedures for responding to and for the investigation of complaints against accredited facilities, including policies and procedures regarding coordination of these activities with appropriate licensing bodies and CMS. (10) The organization's policies and procedures for the withholding or removal of accreditation status for facilities that fail to meet the accreditation organization's standards or requirements, and other actions taken by the organization in response to noncompliance with its standards and requirements. These policies and procedures must include notifying CMS of Medicare facilities that fail to meet the requirements of the accrediting organization. (11) A list of all currently accredited suppliers, the type and category of accreditation currently held by each supplier, and the expiration date of each supplier's current accreditation. (12) A written presentation that demonstrates the organization's ability to furnish CMS with electronic data in ASCII comparable code. (13) A resource analysis that demonstrates that the organization's staffing, funding, and other resources are adequate to perform the required surveys and related activities. (14) A statement acknowledging that, as a condition for approval of designation, the organization agrees to carry out the following activities: (i) Prioritize surveys for those suppliers needing to be accredited by January 1, 2012. (ii) Notify CMS, in writing, of any Medicare supplier that had its accreditation revoked, withdrawn, revised, or any other remedial or adverse action taken against it by the accreditation organization within 30 calendar days of any such action taken. (iii) Notify all accredited suppliers within 10 calendar days of the organization's removal from the list of designated accreditation organizations. (iv) Notify CMS, in writing, at least 30 calendar days in advance of the effective date of any significant proposed changes in its accreditation requirements. (v) Permit its surveyors to serve as witnesses if CMS takes an adverse action based on accreditation findings. (vi) Notify CMS, in writing (electronically or hard copy), within 2 business days of a deficiency identified in any accreditation supplier from any source where the deficiency poses an immediate jeopardy to the supplier's beneficiaries or a hazard to the general public. (vii) Provide, on an annual basis, summary data specified by CMS that relates to the past year's accreditations and trends. (viii) Attest that the organization will not perform any accreditation surveys of Medicare-participating suppliers with which it has a financial relationship in which it has an interest. (ix) Conform accreditation requirements to changes in Medicare requirements. (x) If CMS withdraws an accreditation organization's approved status, work collaboratively with CMS to direct suppliers to the remaining accreditation organizations within a reasonable period of time. (d) Determination of whether additional information is needed. (e) Visits to the organization's office. (f) Formal notice from CMS. (g) Ongoing responsibilities of a CMS-approved accreditation organization. (1) Provide CMS with all of the following in written format (either electronic or hard copy): (i) Copies of all accreditation surveys, together with any survey-related information that CMS may require (including corrective action plans and summaries of findings with respect to unmet CMS requirements). (ii) Notice of all accreditation decisions. (iii) Notice of all complaints related to suppliers. (iv) Information about all accredited suppliers against which the accreditation organization has taken remedial or adverse action, including revocation, withdrawal, or revision of the supplier's accreditation. (v) Notice of any proposed changes in its accreditation standards or requirements or survey process. If the organization implements the changes before or without CMS' approval, CMS may withdraw its approval of the accreditation organization. (2) Within 30 calendar days after a change in CMS requirements, the accreditation organization must submit an acknowledgment of receipt of CMS' notification to CMS. (3) The accreditation organization must permit its surveyors to serve as witnesses if CMS takes an adverse action based on accreditation findings. (4) Within 2 business days of identifying a deficiency of an accredited supplier that poses immediate jeopardy to a beneficiary or to the general public, the accreditation organization must provide CMS with written notice of the deficiency and any adverse action implemented by the accreditation organization. (5) Within 10 calendar days after CMS' notice to a CMS-approved accreditation organization that CMS intends to withdraw approval of the accreditation organization, the accreditation organization must provide written notice of the withdrawal to all of the organization's accredited suppliers. (6) The organization must provide, on an annual basis, summary data specified by CMS that relate to the past year's accreditation activities and trends. (h) Continuing Federal oversight of approved accreditation organizations. (1) Validation audits. (ii) The audits must be conducted on a representative sample of suppliers who have been accredited by a particular accrediting organization or in response to allegations of supplier noncompliance with the standards. (A) When conducted on a representative sample basis, the audit is comprehensive and addresses all of the standards, or may focus on a specific standard in issue. (B) When conducted in response to an allegation, CMS audits any standards that CMS determines are related to the allegations. (2) Notice of intent to withdraw approval. (A) A 10 percent or greater rate of disparity between findings by the accreditation organization and findings by CMS on standards that do not constitute immediate jeopardy to patient health and safety if unmet; or (B) Any disparity between findings by the accreditation organization and findings by CMS on standards that constitute immediate jeopardy to patient health and safety if unmet; or, (C) Irrespective of the rate of disparity, widespread or systemic problems in an organization's accreditation process such that accreditation by that accreditation organization no longer provides CMS with adequate assurance that suppliers meet or exceed the Medicare requirements; then CMS will give the organization written notice of its intent to withdraw approval as specified in paragraph (h)(3) of this section. (ii) CMS may also provide the organization written notice of its intent to withdraw approval if an equivalency review, onsite observation, or CMS' daily experience with the accreditation organization suggests that the accreditation organization is not meeting the requirements of this section. (3) Withdrawal of approval. (i) Accreditation by the organization no longer adequately assures that the suppliers furnishing the technical component of advanced diagnostic imaging service are meeting the established industry standards for each modality and that failure to meet those requirements could jeopardize the health or safety of Medicare beneficiaries and could constitute a significant hazard to the public health; or (ii) The accreditation organization has failed to meet its obligations with respect to application or reapplication procedures. (i) Reconsideration. (1) Filing requirements. (ii) The request for reconsideration must specify the findings or issues with which the accreditation organization disagrees and the reasons for the disagreement. (iii) A requestor may withdraw its request for reconsideration at any time before the issuance of a reconsideration determination. (2) CMS response to a filing request. (i) The opportunity for an informal hearing to be conducted by a hearing officer appointed by the Administrator of CMS and provide the accreditation organization the opportunity to present, in writing and in person, evidence or documentation to refute the determination to deny approval, or to withdraw or not renew designation; and (ii) Written notice of the time and place of the informal hearing at least 10 business days before the scheduled date. (3) Hearing requirements and rules. (A) CMS. (B) The organization requesting the reconsideration including— ( 1 ( 2 ( 3 (ii) The hearing is conducted by the hearing officer who receives testimony and documents related to the proposed action. (iii) Testimony and other evidence may be accepted by the hearing officer even though such evidence may be inadmissible under the Federal Rules of Civil Procedure. (iv) The hearing officer does not have the authority to compel by subpoena the production of witnesses, papers, or other evidence. (v) Within 45 calendar days of the close of the hearing, the hearing officer presents the findings and recommendations to the accreditation organization that requested the reconsideration. (vi) The written report of the hearing officer includes separate numbered findings of fact and the legal conclusions of the hearing officer. (vii) The hearing officer's decision is final. (j) Change of ownership. [74 FR 62006, Nov. 25, 2009, as amended at 87 FR 25427, Apr. 29, 2022] § 414.80 Incentive payment for primary care services. (a) Definitions. Eligible primary care practitioner (i) A physician (as defined in section 1861(r)(1) of the Act) who meets all of the following criteria: (A) Enrolled in Medicare with a primary specialty designation of 08-family practice, 11-internal medicine, 37-pediatrics, or 38-geriatrics. (B) At least 60 percent of the physician's allowed charges under the physician fee schedule (excluding hospital inpatient care and emergency department visits) during a reference period specified by the Secretary are for primary care services. (ii) A nurse practitioner, clinical nurse specialist, or physician assistant (as defined in section 1861(aa)(5) of the Act) who meets all of the following criteria: (A) Enrolled in Medicare with a primary specialty designation of 50-nurse practitioner, 89-certified clinical nurse, or 97-physician assistant. (B) At least 60 percent of the practitioner's allowed charges under the physician fee schedule (excluding hospital inpatient care and emergency department visits) during a reference period specified by the Secretary are for primary care services. Primary care services (i) New and established patient office or other outpatient evaluation and management (E/M) visits; (ii) Initial, subsequent, discharge, and other nursing facility E/M services; (iii) New and established patient domiciliary, rest home (for example, boarding home), or custodial care E/M services; (iv) Domiciliary, rest home (for example, assisted living facility), or home care plan oversight services; and (v) New and established patient home E/M visits. (b) Payment. (2) The payment described in paragraph (b)(1) of this section is made to the eligible primary care practitioner or, where the physician has reassigned his or her benefits to a critical access hospital (CAH) paid under the optional method, to the CAH based on an institutional claim. [75 FR 73617, Nov. 29, 2010] § 414.84 Payment for MDPP services. (a) Definitions. Attendance payment Performance goal Performance payment (b) Performance payment. (1) Performance Goal 1: Achieves the required minimum 5-percent weight loss. (i) For a core session or core maintenance session, as applicable, furnished January 1, 2024 through December 31, 2024 the amount is $145. (ii) For a core session or core maintenance session, as applicable, furnished during a calendar year subsequent to CY 2018. The performance payment amount specified in this paragraph for the prior year, adjusted as specified in paragraph (d) of this section. (iii) If the beneficiary maintains the required minimum weight loss during a core maintenance session, as measured in-person or described in § 410.79(e)(3)(iii) the amount is $8. (2) Performance Goal 2: Achieves 9-percent weight loss. (i) For a core session or core maintenance session, as applicable, furnished January 1, 2024 through December 31, 2024. $25. (ii) For a core session or core maintenance session, as applicable, furnished during a calendar year subsequent to CY 2018. The performance payment amount specified in this paragraph, adjusted as specified in paragraph (d) of this section. (c) Attendance payment: Attends a core session or core maintenance session. (1) The first core session attended, which initiates the MDPP services period, and that first core session was furnished by that supplier. (2) For the Extended flexibilities period described in § 410.79(e)(2)(iii), the distance learning HCPCS G-code applies for any Set of MDPP services that are delivered by distance learning, as described in § 410.79(b). (3) For the duration of Online delivery described in § 410.79(f), the Online HCPCS G-code applies for any Set of MDPP services that are delivered Online, as described in § 410.79(b). (4) Medicare pays for up to 22 sessions in a 12-month period. The amount of this payment is determined as follows: (i) For a core session or core maintenance session furnished January 1, 2024 through December 31, 2024. $25. (ii) For a core session or core maintenance session furnished January 1, 2026 through December 31, 2026, $18. (5) Current Procedural Terminology (CPT) Modifier 76 (repeat services by same physician) must be appended to any claim for G9886, G9887, or G9871 to identify a MDPP make-up session that was held on the same day as a regularly scheduled MDPP session. (d) Updating performance payments and attendance payments. [82 FR 53360, Nov. 15, 2017, as amended at 86 FR 65668, Nov. 19, 2021; 86 FR 73159, Dec. 27, 2021; 88 FR 79530, Nov. 16, 2023; 89 FR 98558, Dec. 9, 2024; 90 FR 50008, Nov. 5, 2025; 91 FR 12079, Mar. 12, 2026] § 414.90 Physician Quality Reporting System (PQRS). (a) Basis and scope. (1) 1848(a)—Payment Based on Fee Schedule. (2) 1848(k)—Quality Reporting System. (3) 1848(m)—Incentive Payments for Quality Reporting. (b) Definitions. Administrative claims Certified survey vendor Covered professional services Direct electronic health record (EHR) product Electronic health record (EHR) data submission vendor product Eligible professional (i) A physician. (ii) A practitioner described in section 1842(b)(18)(C) of the Act. (iii) A physical or occupational therapist or a qualified speech-language pathologist. (iv) A qualified audiologist (as defined in section 1861(ll)(3)(B) of the Act). Group practice Group practice reporting option (GPRO) web interface Maintenance of Certification Program (i) The program requires the physician to maintain a valid unrestricted license in the United States. (ii) The program requires a physician to participate in educational and self-assessment programs that require an assessment of what was learned. (iii) The program requires a physician to demonstrate, through a formalized secure examination, that the physician has the fundamental diagnostic skills, medical knowledge, and clinical judgment to provide quality care in their respective specialty. (iv) The program requires successful completion of a qualified maintenance of certification program practice assessment. Maintenance of Certification Program Practice Assessment (i) Includes an initial assessment of an eligible professional's practice that is designed to demonstrate the physician's use of evidence-based medicine. (ii) Includes a survey of patient experience with care. (iii) Requires a physician to implement a quality improvement intervention to address a practice weakness identified in the initial assessment under paragraph (h) of this section and then to remeasure to assess performance improvement after such intervention. Measures group Physician Quality Reporting System (PQRS) Performance rate Qualified clinical data registry (i) Submit quality measures data or results to CMS for purposes of demonstrating that, for a reporting period, its eligible professionals have satisfactorily participated in PQRS. A qualified clinical data registry must have in place mechanisms for the transparency of data elements and specifications, risk models, and measures. (ii) Submit to CMS, for purposes of demonstrating satisfactory participation, quality measures data on multiple payers, not just Medicare patients. (iii) Provide timely feedback, at least four times a year, on the measures at the individual participant level for which the qualified clinical data registry reports on the eligible professional's behalf for purposes of the individual eligible professional's satisfactory participation in the clinical quality data registry. (iv) Possess benchmarking capacity that measures the quality of care an eligible professional provides with other eligible professionals performing the same or similar functions. Qualified registry Reporting rate (c) Incentive payments. (1) There are any quality measures that have been established under the PQRS that are applicable to any such services furnished by such professional (or in the case of a group practice under paragraph (i) of this section, such group practice) for such reporting period; and (2) If the eligible professional (or in the case of a group practice under paragraph (j) of this section, the group practice) satisfactorily submits (as determined under paragraph (g) of this section for the eligible professional and paragraph (i) of this section for the group practice) to the Secretary data on such quality measures in accordance with the PQRS for such reporting period, in addition to the amount otherwise paid under section 1848 of the Act, there also must be paid to the eligible professional (or to an employer or facility in the cases described in section 1842(b)(6)(A) of the Act or, in the case of a group practice under paragraph (i) of this section, to the group practice) from the Federal Supplementary Medical Insurance Trust Fund established under section 1841 of the Act an amount equal to the applicable quality percent (as specified in paragraph (c)(3) of this section) of the eligible professional's (or, in the case of a group practice under paragraph (i) of this section, the group practice's) total estimated allowed charges for all covered professional services furnished by the eligible professional (or, in the case of a group practice under paragraph (i) of this section, by the group practice) during the reporting period. (3) The applicable quality percent is as follows: (i) For 2007 and 2008, 1.5 percent. (ii) For 2009 and 2010, 2.0 percent. (iii) For 2011, 1.0 percent. (iv) For 2012, 2013, and 2014, 0.5 percent. (4) For purposes of this paragraph (c)— (i) The eligible professional's (or, in the case of a group practice under paragraph (i) of this section, the group practice's) total estimated allowed charges for covered professional services furnished during a reporting period are determined based on claims processed in the National Claims History (NCH) no later than 2 months after the end of the applicable reporting period; (ii) In the case of the eligible professional who furnishes covered professional services in more than one practice, incentive payments are separately determined for each practice based on claims submitted for the eligible professional for each practice; (iii) Incentive payments to a group practice under this paragraph must be in lieu of the payments that would otherwise be made under the PQRS to eligible professionals in the group practice for meeting the criteria for satisfactory reporting for individual eligible professionals. For any program year in which the group practice (as identified by the TIN) is selected to participate in the PQRS group practice reporting option, the eligible professional cannot individually qualify for a PQRS incentive payment by meeting the requirements specified in paragraph (g) of this section. (iv) Incentive payments earned by the eligible professional (or in the case of a group practice under paragraph (i) of this section, by the group practice) for a particular program year will be paid as a single consolidated payment to the TIN holder of record. (5) The Secretary must treat an individual eligible professional, as identified by a unique TIN/NPI combination, as satisfactorily submitting data on quality measures (as determined under paragraph (g) of this section), if the eligible professional is satisfactorily participating (as determined under paragraph (h) of this section), in a qualified clinical data registry. (d) Additional incentive payment. (1) In order to qualify for the additional incentive payment described in paragraph (d) of this section, an eligible professional must meet all of the following requirements: (i) Satisfactorily submits data on quality measures, or, for 2014, in lieu of satisfactory reporting, satisfactorily participates in a qualified clinical data registry for purposes of this section for the applicable incentive year. (ii) Have such data submitted on their behalf through a Maintenance of Certification program that meets: (A) The criteria for a registry (as specified by CMS); or (B) An alternative form and manner determined appropriate by the Secretary. (iii) The eligible professional, more frequently than is required to qualify for or maintain board certification status— (A) Participates in a maintenance of certification program for a year; and (B) Successfully completes a qualified maintenance of certification program practice assessment for such year. (2) In order for an eligible professional to receive the additional incentive payment, a Maintenance of Certification Program must submit to the Secretary, on behalf of the eligible professional, information— (i) In a form and manner specified by the Secretary, that the eligible professional has successfully met the requirements of paragraph (d)(1)(iii) of this section, which may be in the form of a structural measure. (ii) If requested by the Secretary, on the survey of patient experience with care. (iii) As the Secretary may require, on the methods, measures, and data used under the Maintenance of Certification Program and the qualified Maintenance of Certification Program practice assessment. (e) Payment adjustments. (1) The applicable percent is as follows: (i) For 2015, 98.5 percent. (ii) For 2016 through 2018, 98 percent. (2) The Secretary must treat an individual eligible professional, as identified by a unique TIN/NPI combination, as satisfactorily submitting data on quality measures (as determined under paragraph (h) of this section), if the eligible professional is satisfactorily participating, in a qualified clinical data registry. (f) Use of appropriate and consensus-based quality measures. (1) Be such measures selected by the Secretary from measures that have been endorsed by the entity with a contract with the Secretary under section 1890(a) of the Act. In the case of a specified area or medical topic determined appropriate by the Secretary for which a feasible and practical measure has not been endorsed by the entity with a contract under section 1890(a) of the Act, the Secretary may specify a measure that is not so endorsed as long as due consideration is given to measures that have been endorsed or adopted by a consensus organization identified by the Secretary. (2) For each quality measure adopted by the Secretary under this paragraph, the Secretary ensures that eligible professionals have the opportunity to provide input during the development, endorsement, or selection of quality measures applicable to services they furnish. (g) Use of quality measures for satisfactory participation in a qualified clinical data registry. (h) Satisfactory reporting requirements for the incentive payments. (1) Reporting periods. (i) The 12-month period from January 1 through December 31 of such program year. (ii) A 6-month period from July 1 through December 31 of such program year. (A) For 2011, such 6-month reporting period is not available for EHR-based reporting of individual PQRS quality measures. (B) For 2012 and subsequent program years, such 6-month reporting period from July 1 through December 31 of such program year is only available for registry-based reporting of PQRS measures groups by eligible professionals. (2) Reporting mechanisms for individual eligible professionals. (i) Claims. (A) If an eligible professional re-submits a Medicare Part B claim for reprocessing, the eligible professional may not attach a G-code at that time for reporting on individual PQRS measures or measures groups. (B) [Reserved] (ii) Registry. (iii) Direct EHR product. (iv) EHR data submission vendor. (v) Although an eligible professional may attempt to qualify for the PQRS incentive payment by reporting on both individual PQRS quality measures and measures groups, using more than one reporting mechanism (as specified in paragraph (g)(2) of this section), or reporting for more than one reporting period, he or she will receive only one PQRS incentive payment per TIN/NPI combination for a program year. (3) Satisfactory reporting criteria for individual eligible professionals for the 2014 PQRS incentive. (i) Via Claims. (A) Report at least 9 measures covering at least 3 National Quality Strategy domains, and report each measure for at least 50 percent of the Medicare Part B FFS patients seen during the reporting period to which the measure applies; or if less than 9 measures covering at least 3 National Quality Strategy domains apply to the eligible professional, report 1 to 8 measures covering 1 to 3 National Quality Strategy domains and report each measure for at least 50 percent of the Medicare Part B FFS patients seen during the reporting period to which the measure applies. For an eligible professional who reports fewer than 9 measures covering at least 3 NQS domains via the claims-based reporting mechanism, the eligible professional would be subject to the Measures Applicability Validation process, which would allow us to determine whether an eligible professional should have reported quality data codes for additional measures and/or covering additional National Quality Strategy domains. Measures with a 0 percent performance rate would not be counted. (B) [Reserved] (ii) Via Qualified Registry. (1) Report at least 9 measures covering at least 3 of the National Quality Strategy domains report each measure for at least 50 percent of the eligible professional's Medicare Part B FFS patients seen during the reporting period to which the measure applies; or, if less than 9 measures covering at least 3 NQS domains apply to the eligible professional, report 1 to 8 measures covering 1 to 3 National Quality Strategy domains for which there is Medicare patient data and report each measure for at least 50 percent of the eligible professional's Medicare Part B FFS patients seen during the reporting period to which the measure applies. For an eligible professional who reports fewer than 9 measures covering at least 3 NQS domains via the qualified registry-based reporting mechanism, the eligible professional will be subject to the Measures Applicability Validation process, which would allow us to determine whether an eligible professional should have reported on additional measures and/or measures covering additional National Quality Strategy domains. Measures with a 0 percent performance rate would not be counted. ( 2 (B) For the 6-month 2014 PQRS incentive reporting period, report at least 1 measures group and report each measures group for at least 20 patients, a majority of which much be Medicare Part B FFS patients. Measures groups containing a measure with a 0 percent performance rate will not be counted. (iii) Via EHR Direct Product. (iv) Via EHR Data Submission Vendor. (4) Reporting mechanisms for group practices. (i) Web interface. (ii) Registry. (iii) Direct EHR product. (iv) EHR data submission vendor. (v) Certified survey vendors. (vi) Although a group practice may attempt to qualify for the PQRS incentive payment by using more than one reporting mechanism (as specified in paragraph (g)(3) of this section), or reporting for more than one reporting period, the group practice will receive only one PQRS incentive payment for a program year. (5) Satisfactory reporting criteria for group practices for the 2014 PQRS incentive. (i) Via the GPRO web interface. (B) For the 12-month 2014 PQRS incentive reporting period, for a group practice of 100 or more eligible professionals, report on all measures included in the web interface and populate data fields for the first 411 consecutively ranked and assigned beneficiaries in the order in which they appear in the group's sample for each module or preventive care measure. If the pool of eligible assigned beneficiaries is less than 411, then report on 100 percent of assigned beneficiaries. In addition, for the 12-month 2014 PQRS incentive reporting period, the group practice must report all CAHPS for PQRS survey measures via a CMS-certified survey vendor, and report at least 6 measures covering at least 2 of the National Quality Strategy domains using a qualified registry, direct EHR product, or EHR data submission vendor. (ii) Via Qualified Registry. (iii) Via EHR Direct Product. (iv) Via EHR Data Submission Vendor. (v) Via a Certified survey vendor, in addition to the GPRO web interface, qualified registry, direct EHR product, or EHR data submission vendor reporting mechanisms. (i) Satisfactory participation requirements for the incentive payments for individual eligible professionals. (1) Reporting period. (2) Reporting Mechanism. (3) Satisfactory participation criteria for individual eligible professionals for the 2014 PQRS incentive. (i) For the 12-month 2014 PQRS incentive reporting period, report at least 9 measures designated for reporting under a qualified clinical data registry covering at least 3 of the National Quality Strategy domains and report each measure for at least 50 percent of the eligible professional's patients. Of the measures reported via a qualified clinical data registry, the eligible professional must report on at least 1 outcome measure. (ii) [Reserved] (j) Satisfactory reporting requirements for the payment adjustments. (1) For purposes of this paragraph (j), the reporting period for the payment adjustment, with respect to a payment adjustment year, is the 12-month period from January 1 through December 31 that falls 2 years prior to the year in which the payment adjustment is applied. (i) For the 2015 and 2016 PQRS payment adjustments only, an alternative 6-month reporting period, from July 1-December 31 that fall 2 years prior to the year in which the payment adjustment is applied, is also available. (ii) Secondary Reporting Period for the 2017 PQRS payment adjustment for certain eligible professionals or group practices- Individual eligible professionals or group practices, who bill under the TIN of an ACO participant if the ACO failed to report data on behalf of such EPs or group practices during the previously established reporting period for the 2017 PQRS payment adjustment, may separately report during a secondary reporting period for the 2017 PQRS payment adjustment. The secondary reporting period for the 2017 PQRS payment adjustment for the affected individual eligible professionals or group practices is January 1, 2016 through December 31, 2016. (2) Reporting mechanisms for individual eligible professionals. (i) Claims. (A) If an eligible professional re-submits a Medicare Part B claim for reprocessing, the eligible professional may not attach a G-code at that time for reporting on individual PQRS measures or measures groups. (B) [Reserved] (ii) Registry. (iii) Direct EHR product. (iv) EHR data submission vendor. (v) Administrative claims. (A) Elect to participate in the PQRS using the administrative claims reporting option. (B) Reporting Medicare Part B claims data for CMS to determine whether the eligible professional has performed services applicable to certain individual PQRS quality measures. (3) Satisfactory reporting criteria for individual eligible professionals for the 2016 PQRS payment adjustment. (i) Via Claims. ( 1 i ( ii ( 2 (ii) Via Qualified Registry. ( 1 i ( ii ( iii ( 2 (B) For the 6-month 2016 PQRS payment adjustment reporting period— ( 1 (iii) Via EHR Direct Product. (iv) Via EHR Data Submission Vendor. (4) Satisfactory Reporting Criteria for Individual Eligible Professionals for the 2017 PQRS Payment Adjustment. (i) Via Claims. ( 1 i ( ii (ii) Via Qualified Registry. ( 1 i ( ii ( 2 (iii) Via EHR Direct Product. (iv) Via EHR Data Submission Vendor. (v) Paragraphs (j)(8)(ii), (iii), and (iv) of this section apply to individuals reporting using the secondary reporting period established under paragraph (j)(1)(ii) of this section for the 2017 PQRS payment adjustment. (5) Reporting mechanisms for group practices. (i) Web interface. (ii) Registry. (iii) Direct EHR product. (iv) EHR data submission vendor. (v) Administrative claims. (A) Elect to participate in the PQRS using the administrative claims reporting option. (B) Reporting Medicare Part B claims data for CMS to determine whether the group practice has performed services applicable to certain individual PQRS quality measures. (vi) Certified Survey Vendors. (6) Satisfactory reporting criteria for group practices for the 2016 PQRS payment adjustment. (i) Via the GPRO web interface. (B) For the 12-month 2016 PQRS payment adjustment reporting period, for a group practice of 100 or more eligible professionals, report on all measures included in the Web interface and populate data fields for the first 411 consecutively ranked and assigned beneficiaries in the order in which they appear in the group's sample for each module or preventive care measure. If the pool of eligible assigned beneficiaries is less than 411, then report on 100 percent of assigned beneficiaries. In addition, the group practice must also report all CAHPS for PQRS survey measures via certified survey vendor. (ii) Via Qualified Registry. ( 1 ( 2 (iii) Via EHR Direct Product. (iv) Via EHR Data Submission Vendor. (v) Via a Certified survey vendor, in addition to the GPRO Web interface, qualified registry, direct EHR product, or EHR data submission vendor reporting mechanisms. (7) Satisfactory reporting criteria for group practices for the 2017 PQRS payment adjustment. (i) Via the GPRO web interface. (ii) Via Qualified Registry. (iii) Via EHR Direct Product. (iv) Via EHR Data Submission Vendor. (v) Via a Certified Survey Vendor in addition to a Qualified Registry. (vi) Via a Certified Survey Vendor in addition a Direct EHR Product or EHR Data Submission Vendor. (vii) Via a Certified Survey Vendor in addition to the GPRO Web interface. (B) [Reserved] (viii) Paragraphs (j)(9)(ii), (iii), and (iv) of this section apply to group practices reporting using the secondary reporting period established under paragraph (j)(1)(ii) of this section for the 2017 PQRS payment adjustment. (8) Satisfactory reporting criteria for individual eligible professionals for the 2018 PQRS payment adjustment (i) Via claims ( 1 i ( ii ( 2 (B) [Reserved] (ii) Via qualified registry ( 1 i ( ii ( 2 (B) [Reserved] (iii) Via EHR direct product. (iv) Via EHR data submission vendor. (9) Satisfactory reporting criteria for group practices for the 2018 PQRS payment adjustment (i) Via the GPRO web interface (ii) Via qualified registry. (iii) Via EHR direct product. (iv) Via EHR data submission vendor. (v) Via a certified survey vendor in addition to a qualified registry. (vi) Via a certified survey vendor in addition to a direct EHR product or EHR data submission vendor. (vii) Via a certified survey vendor in addition to the GPRO web interface (B) [Reserved] (viii) If the CAHPS for PQRS survey is applicable to the practice, group practices comprised of 100 or more eligible professionals that register to participate in the GPRO may administer the CAHPS for PQRS survey, regardless of the GPRO reporting mechanism selected. (k) Satisfactory participation requirements for the payment adjustments for individual eligible professionals and group practices. (1) Reporting period. For purposes of this paragraph, the reporting period is— (i) The 12-month period from January 1 through December 31 that falls 2 years prior to the year in which the payment adjustment is applied. (ii) [Reserved] (2) Reporting mechanism (3) Satisfactory participation criteria for individual eligible professionals for the 2016 PQRS payment adjustment. (i) For the 12-month 2016 PQRS payment adjustment reporting period— (A) Report at least 9 measures available for reporting under a qualified clinical data registry covering at least 3 of the National Quality Strategy domains and report each measure for at least 50 percent of the eligible professional's patients; or (B) Report at least 3 measures available for reporting under a qualified clinical data registry covering at least 1 of the National Quality Strategy domains and report each measure for at least 50 percent of the eligible professional's patients. (4) Satisfactory participation criteria for individual eligible professionals for the 2017 PQRS payment adjustment. (i) For the 12-month 2017 PQRS payment adjustment reporting period, report at least 9 measures available for reporting under a QCDR covering at least 3 of the NQS domains, and report each measure for at least 50 percent of the eligible professional's patients. Of these measures, report on at least 2 outcome measures, or, if 2 outcomes measures are not available, report on at least 2 outcome measures and at least 1 of the following types of measures—resource use, patient experience of care, efficiency/appropriate use or patient safety. (ii) Section 414.90(k)(5) applies to individuals and group practices reporting using the secondary reporting period established under paragraph (j)(1)(ii) of this section for the 2017 PQRS payment adjustment. (5) Satisfactory participation criteria for individual eligible professionals and group practices for the 2018 PQRS payment adjustment (i) Individual eligible professional. (ii) Group practices. (l) Requirements for group practices. (1) Meet the participation requirements specified by CMS for the PQRS group practice reporting option. (2) Report measures in the form and manner specified by CMS. (3) Meet other requirements for satisfactory reporting specified by CMS. (4) Meet participation requirements. (i) If an eligible professional, as identified by an individual NPI, has reassigned his or her Medicare billing rights to a group practice (as identified by the TIN) selected to participate in the PQRS group practice reporting option for a program year, then for that program year the eligible professional must participate in the PQRS via the group practice reporting option. (ii) If, for the program year, the eligible professional participates in the PQRS as part of a group practice (as identified by the TIN) that is not selected to participate in the PQRS group practice reporting option for that program year, then the eligible professional may individually participate and qualify for a PQRS incentive by meeting the requirements specified in paragraph (g) of this section under that TIN. (m) Informal review. (1) To request an informal review for reporting periods that occur prior to 2014, an eligible professional or group practice must submit a request to CMS within 90 days of the release of the feedback reports. To request an informal review for reporting periods that occur in 2014 and subsequent years, an eligible professional or group practice must submit a request to CMS within 60 days of the release of the feedback reports. The request must be submitted in writing and summarize the concern(s) and reasons for requesting an informal review and may also include information to assist in the review. (2) CMS will provide a written response within 90 days of the receipt of the original request. (i) All decisions based on the informal review will be final. (ii) There will be no further review or appeal. (3) If, during the informal review process, CMS finds errors in data that was submitted by a third-party vendor on behalf of an eligible professional or group practice using either the qualified registry, EHR data submission vendor, or QCDR reporting mechanisms, CMS may allow for the resubmission of data to correct these errors. (i) CMS will not allow resubmission of data submitted via claims, direct EHR, and the GPRO web interface reporting mechanisms. (ii) CMS will only allow resubmission of data that was already previously submitted to CMS. (iii) CMS will only accept data that was previously submitted for the reporting periods for which the corresponding informal review period applies. (n) Limitations on review. (1) The determination of measures applicable to services furnished by eligible professionals under the PQRS; (2) The determination of satisfactory reporting; and (3) The determination of any Physician Quality Reporting System incentive payment and the PQRS payment adjustment. (o) Public reporting of an eligible professional's or group practice's PQRS data. [78 FR 74812, Dec. 10, 2013, as amended at 79 FR 68003, Nov. 13, 2014; 81 FR 34913, June 1, 2016; 81 FR 77537, Nov. 4, 2016; 81 FR 80554, Nov. 15, 2016; 82 FR 53362, Nov. 15, 2017] § 414.92 Electronic Prescribing Incentive Program. (a) Basis and scope. (1) Section 1848(a)—Payment Based on Fee Schedule. (2) Section 1848(m)—Incentive Payments for Quality Reporting. (b) Definitions. Certified electronic health record technology Covered professional services Electronic Prescribing Incentive Program Eligible professional (i) A physician. (ii) A practitioner described in section 1842(b)(18)(C) of the Act. (iii) A physical or occupational therapist or a qualified speech-language pathologist. (iv) A qualified audiologist (as defined in section 1861(ll)(3)(B) of the Act). Group practice (i)(A) Defined at § 414.90(b), that is participating in the Physician Quality Reporting System; or (B) In a Medicare-approved demonstration project or other Medicare program, under which Physician Quality Reporting System requirements and incentives have been incorporated; and (ii) Has indicated its desire to participate in the electronic prescribing group practice option. Qualified electronic health record product Qualified registry (c) Incentive payments and payment adjustments. Incentive payments. (i) For purposes of paragraph (c)(1) of this section, (A) The eligible professional's (or, in the case of a group practice under paragraph (e) of this section, the group practice's) total estimated allowed charges for covered professional services furnished during a reporting period are determined based on claims processed in the National Claims History (NCH) no later than 2 months after the end of the applicable reporting period; (B) In the case of an eligible professional who furnishes covered professional services in more than one practice, incentive payments are separately determined for each practice based on claims submitted for the eligible professional for each practice; (C) Incentive payments earned by an eligible professional (or in the case of a group practice under paragraph (e) of this section, by a group practice) for a particular program year will be paid as a single consolidated payment to the TIN holder of record. (ii) Applicable electronic prescribing percent. (A) For the 2011 and 2012 program years, 1.0 percent. (B) For the 2013 program year, 0.5 percent. (iii) Limitation with respect to electronic health record (EHR) incentive payments. (2) Payment adjustment. (i) Applicable percent. (A) For 2012, 99 percent; (B) For 2013, 98.5 percent; and (C) For 2014, 98 percent. (ii) Significant hardship exception. (A) From the 2012 payment adjustments by meeting one of the following: ( 1 ( 2 ( 3 ( 4 ( 5 ( 6 (B) From the 2013 and 2014 payment adjustments by meeting one of the following: ( 1 ( 2 ( 3 ( 4 (iii) Other limitations to the payment adjustment. (A) The eligible professional is not an MD, DO, podiatrist, nurse practitioner, or physician assistant. (B) The eligible professional does not have at least 100 cases containing an encounter code that falls within the denominator of the electronic prescribing measure for dates of service during the 6-month reporting period specified in paragraph (f)(1) of this section. (3) Limitation with respect to electronic prescribing quality measures. (d) Requirements for individual eligible professionals to qualify to receive an incentive payment. (1) Reporting period. (2) Reporting mechanisms. (i) CMS, by no later than 2 months after the end of the applicable reporting period, on the eligible professional's Medicare Part B claims for covered professional services furnished by the eligible professional during the reporting period specified in paragraph (d)(1) of this section; (ii) A qualified registry (as defined in paragraph (b) of this section) in the form and manner and by the deadline specified by the qualified registry selected by the eligible professional. The selected qualified registry will submit information, as required by CMS, for covered professional services furnished by the eligible professional during the reporting period specified in paragraph (d)(1) of this section to CMS on the eligible professional's behalf; or (iii) CMS by extracting clinical data using a secure data submission method, as required by CMS, from a qualified electronic health record product (as defined in paragraph (b) of this section) by the deadline specified by CMS for covered professional services furnished by the eligible professional during the reporting period specified in paragraph (d)(1) of this section. Prior to actual data submission for a given program year and by a date specified by CMS, the eligible professional must submit a test file containing real or dummy clinical quality data extracted from the qualified electronic health record product selected by the eligible professional using a secure data submission method, as required by CMS. (e) Requirements for group practices to qualify to receive an incentive payment. (2) No double payments. (i) If an eligible professional, as identified by an individual NPI, has reassigned his or her Medicare billing rights to a TIN selected to participate in the electronic prescribing group practice reporting option for a program year, then for that program year the eligible professional must participate in the Electronic Prescribing Incentive Program via the group practice reporting option. For any program year in which the TIN is selected to participate in the Electronic Prescribing Incentive Program group practice reporting option, the eligible professional cannot individually qualify for an electronic prescribing incentive payment by meeting the requirements specified in paragraph (d) of this section. (ii) If, for the program year, the eligible professional participates in the Electronic Prescribing Incentive Program under a TIN that is not selected to participate in the Electronic Prescribing Incentive Program group practice reporting option for that program year, then the eligible professional may individually qualify for an electronic prescribing incentive by meeting the requirements specified in paragraph (d) of this section under that TIN. (f) Requirements for individual eligible professionals and group practices for the payment adjustment. (1) Reporting periods. (A) The 12-month period from January 1, 2011 through December 31, 2011. (B) The 6-month period from January 1, 2012 through June 30, 2012. (ii) For purposes of this paragraph (f), the reporting period for the 2014 payment adjustment is either of the following: (A) The 12-month period from January 1, 2012 through December 31, 2012. (B) The 6-month period from January 1, 2013 through June 30, 2013. (2) Reporting mechanisms. (i) For the 6- and 12-month reporting periods under paragraph (f)(1) of this section, CMS, by no later than 2 months after the end of the applicable 12-month reporting period or by no later than 1 month after the end of the applicable 6-month reporting period, on the eligible professional's Medicare Part B claims for covered professional services furnished by the eligible professional during the reporting period specified in paragraph (f)(1) of this section. (A) If an eligible professional re-submits a Medicare Part B claim for reprocessing, the eligible professional may not attach a G-code at that time for reporting on the electronic prescribing measure. (B) [Reserved] (ii) For the 12-month reporting period under paragraph (f)(1) of this section, a qualified registry (as defined in paragraph (b) of this section) in the form and manner and by the deadline specified by the qualified registry selected by the eligible professional. The selected qualified registry submits information, as required by CMS, for covered professional services furnished by the eligible professional during the reporting period specified in paragraph (f)(1) of this section to CMS on the eligible professional's behalf. (iii) For the 12-month reporting period under paragraph (f)(1) of this section, CMS by extracting clinical data using a secure data submission method, as required by CMS, from a qualified electronic health record product (as defined in paragraph (b) of this section) by the deadline specified by CMS for covered professional services furnished by the eligible professional during the reporting period specified in paragraph (f)(1) of this section. Prior to actual data submission for a given program year and by a date specified by CMS, the eligible professional must submit a test file containing dummy clinical quality data extracted from the qualified electronic health record product selected by the eligible professional using a secure data submission method, as required by CMS. (g) Informal review. (1) To request an informal review for the 2012 and 2013 incentives, an eligible professional or group practice must submit a request to CMS via email within 90 days of the release of the feedback reports. The request must be submitted in writing and summarize the concern(s) and reasons for requesting an informal review and may also include information to assist in the review. (2) To request an informal review for the 2013 and 2014 payment adjustments, an eligible professional or group practices must submit a request to CMS via email by February 28 of the year in which the eligible professional is receiving the applicable payment adjustment. The request must be submitted in writing and summarize the concern(s) and reasons for requesting an informal review and may also include information to assist in the review. (3) CMS will provide a written response of CMS' determination. (i) All decisions based on the informal review will be final. (ii) There will be no further review or appeal. (h) Public reporting of an eligible professional's or group practice's Electronic Prescribing Incentive Program data. [75 FR 73620, Nov. 29, 2010, as amended at 76 FR 54968, Sept. 6, 2011; 76 FR 73472, Nov. 28, 2011; 77 FR 69368, Nov. 16, 2012; 80 FR 71379, Nov. 16, 2015] § 414.94 [Reserved] Subpart C—Fee Schedules for Parenteral and Enteral Nutrition (PEN) Nutrients, Equipment and Supplies, Splints, Casts, and Certain Intraocular Lenses (IOLs) Source: 66 FR 45176, Aug. 28, 2001, unless otherwise noted. § 414.100 Purpose. This subpart implements fee schedules for PEN items and services, splints and casts, and IOLs inserted in a physician's office as authorized by section 1842(s) of the Act. [78 FR 72252, Dec. 2, 2013] § 414.102 General payment rules. (a) General rule. (1) The actual charge for the item or service; or (2) The fee schedule amount for the item or service, as determined in accordance with §§ 414.104 thru 414.108. (b) Payment classification. (2) CMS designates the specific items and services in each category through program instructions. (c) Updating the fee schedule amounts. [66 FR 45176, Aug. 28, 2001, as amended at 78 FR 72252, Dec. 2, 2013] § 414.104 PEN Items and Services. (a) Payment rules. (b) Fee schedule amount. (i) The reasonable charge from 1995; or (ii) The reasonable charge that would have been used in determining payment for 2002. § 414.105 Application of competitive bidding information. For enteral nutrients, equipment and supplies furnished on or after January 1, 2011, the fee schedule amounts may be adjusted based on information on the payment determined as part of implementation of the programs under subpart F using the methodologies set forth at § 414.210(g). [79 FR 66262, Nov. 6, 2014] § 414.106 Splints and casts. (a) Payment rules. (b) Fee schedule amount. [78 FR 72253, Dec. 2, 2013] § 414.108 IOLs inserted in a physician's office. (a) Payment rules. (b) Fee schedule amount. [78 FR 72253, Dec. 2, 2013] § 414.110 Continuity of pricing when HCPCS codes are divided or combined. (a) General Rule. (b) Mapping fee schedule amounts based on different kinds of coding changes. [84 FR 60806, Nov. 8, 2019] § 414.112 Establishing fee schedule amounts for new HCPCS codes for items and services without a fee schedule pricing history. (a) General rule. (b) Comparability. (c) Use of supplier or commercial price lists. (i) The annual deflation factors are specified in program instructions and are based on the percentage change in the consumer price index for all urban consumers (CPI-U) from the mid-point of the year the prices are in effect to the mid-point of the fee schedule base period, as calculated using the following formula: ((base CPI-U minus current CPI-U) divided by current CPI-U) plus one. (ii) The deflated amounts are then increased by the update factors specified in § 414.102(c). (2) If within 5 years of establishing fee schedule amounts using supplier or commercial prices, the supplier or commercial prices decrease by less than 15 percent, a one-time adjustment to the fee schedule amounts is made using the new prices. The new supplier or commercial prices would be used to establish the new fee schedule amounts in the same way that the older prices were used, including application of the deflation formula in paragraph (c)(1) of this section. [84 FR 60806, Nov. 8, 2019] § 414.114 Procedures for making benefit category determinations and payment determinations for new PEN items and services covered under the prosthetic device benefit; splints and casts; and IOLs inserted in a physician's office covered under the prosthetic device benefit. (a) Definitions. Benefit category determination (b) General rule. (1) At the start of a HCPCS coding cycle, CMS performs an analysis to determine if the item or service is statutorily excluded from coverage under Medicare under section 1862 of the Act, and, if not excluded by statute, whether the item or service is parenteral or enteral nutrients, supplies, and equipment covered under the prosthetic device benefit, splints and casts or other devices used for reductions of fractures or dislocations, or IOLs inserted in a physician's office covered under the prosthetic device benefit. (2) If a preliminary determination is made that the item or service is parenteral or enteral nutrients, supplies, and equipment covered under the prosthetic device benefit, splints and casts or other devices used for reductions of fractures or dislocations, or IOLs inserted in a physician's office covered under the prosthetic device benefit, CMS makes a preliminary payment determination for the item or service. (3) CMS posts preliminary benefit category determinations and payment determinations on CMS.gov (4) After consideration of public consultation provided at a public meeting on preliminary benefit category determinations and payment determinations for items and services, CMS establishes the benefit category determinations and payment determinations for items and services through program instructions. [86 FR 73910, Dec. 28, 2021] Subpart D—Payment for Durable Medical Equipment and Prosthetic and Orthotic Devices § 414.200 Purpose. This subpart implements sections 1834(a), (h) and (i) of the Act by specifying how payments are made for the purchase or rental of new and used durable medical equipment, prosthetic and orthotic devices, and surgical dressings for Medicare beneficiaries. [78 FR 72253, Dec. 2, 2013] § 414.202 Definitions. For purposes of this subpart, the following definitions apply: Complex rehabilitative power-driven wheelchair (1) Group 2 power wheelchair with power options that can accommodate rehabilitative features (for example, tilt in space); or (2) Group 3 power wheelchair. Covered item update Durable medical equipment (1) Can withstand repeated use. (2) Effective with respect to items classified as DME after January 1, 2012, has an expected life of at least 3 years. (3) Is primarily and customarily used to serve a medical purpose. (4) Generally is not useful to an individual in the absence of an illness or injury. (5) Is appropriate for use in the home. Prosthetic and orthotic devices (1) Devices that replace all or part of an internal body organ, including ostomy bags and supplies directly related to ostomy care, and replacement of such devices and supplies; (2) One pair of conventional eyeglasses or contact lenses furnished subsequent to each cataract surgery with insertion of an intraocular lens; and (3) Leg, arm, back, and neck braces, and artificial legs, arms, and eyes, including replacements if required because of a change in the beneficiary's physical condition. The following are neither prosthetic nor orthotic devices— (1) Parenteral and enteral nutrients, supplies, and equipment; (2) Intraocular lenses; (3) Medical supplies such as catheters, catheter supplies, ostomy bags, and supplies related to ostomy care that are furnished by an HHA as part of home health services under § 409.40(e) of this chapter; (4) Dental prostheses. Region Rural area [57 FR 57689, Dec. 7, 1992, as amended at 75 FR 73622, Nov. 29, 2010; 76 FR 70314, Nov. 10, 2011; 79 FR 66262, Nov. 6, 2014] § 414.210 General payment rules. (a) General rule. (1) The actual charge for the item; (2) The fee schedule amount for the item, as determined in accordance with the provisions of §§ 414.220 through 414.232 (b) Payment classification. (i) Inexpensive or routinely purchased items, as specified in § 414.220. (ii) Items requiring frequent and substantial servicing, as specified in § 414.222. (iii) Certain customized items, as specified in § 414.224. (iv) Oxygen and oxygen equipment, as specified in § 414.226. (v) Prosthetic and orthotic devices, as specified in § 414.228. (vi) Other durable medical equipment (capped rental items), as specified in § 414.229. (vii) Transcutaneous electrical nerve stimulators (TENS), as specified in § 414.232. (2) CMS designates the items in each class of equipment or device through its program instructions. (c) Exception for certain HHAs. (d) Prohibition on special limits. (e) Maintenance and servicing General rule. (2) Maintenance and servicing payment for certain oxygen equipment furnished after the 36-month rental period from January 1, 2009 through June 30, 2010. (i) For the first 6-month period following the date on which the 36-month rental period ends in accordance with § 414.226(a)(1) of this subpart, no payments are made. (ii) For each succeeding 6-month period, payment may be made during the first month of that period for 30 minutes of labor for routine maintenance and servicing of the equipment in the beneficiary's home (including an institution used as the beneficiary's home). (iii) The supplier must visit the beneficiary's home (including an institution used as the beneficiary's home) to inspect the equipment during the first month of the 6-month period. (3) Exception to maintenance and servicing payments. (i) Items requiring frequent and substantial servicing, as defined in § 414.222(a); (ii) Capped rental items, as defined in § 414.229(a), that are not beneficiary-owned in accordance with § 414.229(d), § 414.229(f)(2), or § 414.229(h); and (iii) Capped rental items, as defined in § 414.229(a), that are not beneficiary-owned in § 414.229(d), § 414.229(f)(2), or § 414.229(h); and (iv) Oxygen equipment, as described in § 414.226. (4) Supplier replacement of beneficiary-owned equipment based on accumulated repair costs. (5) Maintenance and servicing payment for certain oxygen equipment furnished after the 36-month rental period and on or after July 1, 2010. (i) For the first 6-month period following the date on which the 36-month rental period ends in accordance with § 414.226(a)(1) of this subpart, no payments are made. (ii) For each succeeding 6-month period, payment may be made during the first month of that period for routine maintenance and servicing of the equipment in the beneficiary's home (including an institution used as the beneficiary's home). (iii) Payment for maintenance and servicing is made based on a reasonable fee not to exceed 10 percent of the purchase price for a stationary oxygen concentrator. This payment includes payment for maintenance and servicing of all oxygen equipment other than liquid or gaseous equipment (stationary or portable). (iv) The supplier must visit the beneficiary's home (including an institution used as the beneficiary's home) to inspect the equipment during the first month of the 6-month period. (f) Payment for replacement of equipment. (1) The reasonable useful lifetime of DME or prosthetic and orthotic devices is determined through program instructions. In the absence of program instructions, carriers may determine the reasonable useful lifetime of equipment but in no case can it be less than 5 years. Computation is based on when the equipment is delivered to the beneficiary, not the age of the equipment. (2) If the beneficiary elects to obtain replacement oxygen equipment, payment is made in accordance with § 414.226(a). (3) If the beneficiary elects to obtain a replacement capped rental item, payment is made in accordance with § 414.229(a)(2) or (a)(3). (4) For all other beneficiary-owned items, if the beneficiary elects to obtain replacement equipment, payment is made on a purchase basis. (g) Application of Competitive Bidding Information and Limitation of Inherent Reasonableness Authority. (1) Payment adjustments for areas within the contiguous United States using information from competitive bidding programs. (i) CMS determines a regional price for each state in the contiguous United States and the District of Columbia equal to the un-weighted average of the single payment amounts for an item or service established in accordance with § 414.416 for competitive bidding areas that are fully or partially located in the same region that contains the state or District of Columbia. (ii) CMS determines a national average price equal to the un-weighted average of the regional prices determined under paragraph (g)(1)(i) of this section. (iii) A regional price determined under paragraph (g)(1)(i) of this section cannot be greater than 110 percent of the national average price determined under paragraph (g)(1)(ii) of this section nor less than 90 percent of the national average price determined under paragraph (g)(1)(ii) of this section. (iv) The fee schedule amount for all areas within a state that are not defined as rural areas for purposes of this subpart is adjusted to the regional price determined under paragraphs (g)(1)(i) and (iii) of this section. (v) For items and services furnished before February 28, 2022, the fee schedule amount for all areas within a state that are defined as rural areas for the purposes of this subpart is adjusted to 110 percent of the national average price determined under paragraph (g)(1)(ii) of this section. (2) Payment adjustments for areas outside the contiguous United States and for items furnished on or after February 28, 2022 in rural areas within the contiguous United States using information from competitive bidding programs. (i) For an item or service subject to the programs under subpart F, the fee schedule amounts for areas outside the contiguous United States (Alaska, Hawaii, and U.S. territories) for items and services furnished from January 1, 2016, through December 31, 2020 are reduced to the greater of— (A) The average of the single payment amounts for the item or service for CBAs outside the contiguous United States. (B) 110 percent of the national average price for the item or service determined under paragraph (g)(1)(ii) of this section. (ii) For an item or service subject to the programs under subpart F of this part, the fee schedule amounts for areas outside the contiguous United States for items and services furnished on or after February 28, 2022, or the date immediately following the duration of the emergency period described in section 1135(g)(1)(B) of the Act (42 U.S.C. 1320b-5(g)(1)(B)), or December 31, 2023, whichever is later, is adjusted to equal the sum of— (A) Fifty percent of the greater of the average of the single payment amounts for the item or service for CBAs outside the contiguous United States or 110 percent of the national average price for the item or service determined under paragraph (g)(1)(ii) of this section; and (B) Fifty percent of the fee schedule amount for the area in effect on December 31, 2015, increased for each subsequent year beginning in 2016 by the annual update factors specified in sections 1834(a)(14), 1834(h)(4), and 1842(s)(1)(B) of the Act, respectively, for durable medical equipment and supplies, off-the-shelf orthotics, and enteral nutrients, supplies, and equipment. (iii) For an item or service subject to the programs under subpart F of this part, the fee schedule amounts for rural areas within the contiguous United States for items and services furnished on or after February 28, 2022, or the date immediately following the duration of the emergency period described in section 1135(g)(1)(B) of the Act (42 U.S.C. 1320b-5(g)(1)(B)), or December 31, 2023, whichever is later, is adjusted to equal the sum of— (A) Fifty percent of 110 percent of the national average price for the item or service determined under paragraph (g)(1)(ii) of this section; and (B) Fifty percent of the fee schedule amount for the area in effect on December 31, 2015, increased for each subsequent year beginning in 2016 by the annual update factors specified in sections 1834(a)(14), 1834(h)(4), and 1842(s)(1)(B) of the Act, respectively, for durable medical equipment and supplies, off-the-shelf orthotics, and enteral nutrients, supplies, and equipment. (3) Payment adjustments for items and services included in no more than ten competitive bidding programs. (4) Payment adjustments using data on items and services included in competitive bidding programs no longer in effect. (5) Adjusted payment amounts for accessories used with different types of base equipment. (6) Adjustments of single payment amounts resulting from price inversions under the DMEPOS Competitive Bidding Program. (ii) The groupings of similar items subject to this rule include— (A) Hospital beds (HCPCS codes E0250, E0251, E0255, E0256, E0260, E0261, E0290, E0291, E0292, E0293, E0294, E0295, E0301, E0302, E0303, and E0304). (B) Mattresses and overlays (HCPCS codes E0277, E0371, E0372, and E0373) (C) Power wheelchairs (HCPCS codes K0813, K0814, K0815, K0816, K0820, K0821, K0822, and K0823). (D) Seat lift mechanisms (HCPCS codes E0627 and E0629). (E) TENS devices (HCPCS codes E0720 and E0730). (F) Walkers (HCPCS codes E0130, E0135, E0141, and E0143). (iii) The weight for each item (HCPCS code) used in calculating the weighted average described in paragraph (g)(6)(ii) of this section is equal to the proportion of total nationwide allowed services furnished in calendar year 2012 for the item (HCPCS code) in the grouping of similar items, relative to the total nationwide allowed services furnished in calendar year 2012 for each of the other items (HCPCS codes) in the grouping of similar items. (7) Payment adjustments for mail order items furnished in the Northern Mariana Islands. (8) Updating adjusted fee schedule amounts. (9) Transition rules. (i) For applicable items and services furnished with dates of service from January 1, 2016 through December 31, 2016, based on the fee schedule amount for the area is equal to 50 percent of the adjusted payment amount established under this section and 50 percent of the unadjusted fee schedule amount. (ii) For items and services furnished with dates of service from January 1, 2017, through May 31, 2018, the fee schedule amount for the area is equal to 100 percent of the adjusted payment amount established under this section. (iii) For items and services furnished in rural areas and non-contiguous areas (Alaska, Hawaii, and U.S. territories) with dates of service from June 1, 2018 through the duration of the emergency period described in section 1135(g)(1)(B) of the Act (42 U.S.C. 1320b-5(g)(1)(B)) or December 31, 2023 of the emergency period described in section 1135(g)(1)(B) of the Act (42 U.S.C. 1320b-5(g)(1)(B)), whichever is later, based on the fee schedule amount for the area is equal to 50 percent of the adjusted payment amount established under this section and 50 percent of the unadjusted fee schedule amount. (iv) For items and services furnished in areas other than rural or noncontiguous areas with dates of service from June 1, 2018 through March 5, 2020, based on the fee schedule amount for the area is equal to 100 percent of the adjusted payment amount established under this section. (v) For items and services furnished in areas other than rural or noncontiguous areas with dates of service from March 6, 2020, through the remainder of the duration of the emergency period described in section 1135(g)(1)(B) of the Act (42 U.S.C. 1320b-5(g)(1)(B)) or December 31, 2023, whichever is later, based on the fee schedule amount for the area is equal to 75 percent of the adjusted payment amount established under this section and 25 percent of the unadjusted fee schedule amount. (vi) For items and services furnished in all areas with dates of service on or after January 1, 2024, or the date immediately following the duration of the emergency period described in section 1135(g)(1)(B) of the Act, whichever is later, based on the fee schedule amount for the area is equal to the adjusted payment amount established under paragraph (g) of this section. (10) Payment adjustments for items and services furnished in former competitive bidding areas during temporary gaps in the DMEPOS CBP. [57 FR 57689, Dec. 7, 1992, as amended at 71 FR 65932, Nov. 9, 2006; 73 FR 69936, Nov. 19, 2008; 73 FR 80304, Dec. 31, 2008; 74 FR 62009, Nov. 25, 2009; 79 FR 66262, Nov. 6, 2013; 81 FR 77965, Nov. 4, 2016; 83 FR 21925, May 11, 2018; 83 FR 57070, Nov. 14, 2018; 85 FR 27623, May 8, 2020; 86 FR 73911, Dec. 28, 2021; 87 FR 199, Jan. 4, 2022; 88 FR 77875, Nov. 13, 2023] § 414.220 Inexpensive or routinely purchased items. (a) Definitions. Inexpensive equipment (2) Routinely purchased equipment (3) Accessories. (b) Payment rules. (2) Effective January 1, 1994, payment for ostomy supplies, tracheostomy supplies, urologicals, and surgical dressings not furnished as incident to a physician's professional service or furnished by an HHA is made using the methodology for the inexpensive and routinely purchased class. (3) The total amount of payments made for an item may not exceed the fee schedule amount recognized for the purchase of that item. (c) Fee schedule amount for 1989 and 1990. (1) The carrier determines the average reasonable charge for inexpensive or routinely purchased items that were furnished during the period July 1, 1986 through June 30, 1987 based on the mean of the carrier's allowed charges for the item. A separate determination of an average reasonable charge is made for rental equipment, new purchased equipment, and used purchased equipment. (2) The carrier adjusts the amount determined under paragraph (c)(1) of this section by the change in the level of the CPI-U for the 6-month period ending December 1987. (d) Updating the local payment amounts for years after 1990. (e) Calculating the fee schedule amounts for years after 1990. (f) Calculating the national limited payment amount. (1) The 1991 national limited payment amount is equal to: (i) 100 percent of the local payment amount if the local payment amount is neither greater than the weighted average nor less than 85 percent of the weighted average of all local payment amounts; (ii) The sum of 67 percent of the local payment amount plus 33 percent of the weighted average of all local payment amounts if the local payment amount exceeds the weighted average of all local payment amounts; or (iii) The sum of 67 percent of the local payment amount plus 33 percent of 85 percent of the weighted average of all local payment amounts if the local payment amount is less than 85 percent of the weighted average of all local payment amounts. (2) The 1992 national limited payment amount is equal to: (i) 100 percent of the local payment amount if the local payment amount is neither greater than the weighted average nor less than 85 percent of the weighted average of all local payment amounts; (ii) The sum of 33 percent of the local payment amount plus 67 percent of the weighted average of all local payment amounts if the local payment amount exceeds the weighted average; or (iii) The sum of 33 percent of the local payment amount plus 67 percent of 85 percent of the weighted average of all local payment amounts if the local payment amount is less than 85 percent of the weighted average. (3) For 1993, the national limited payment amount is equal to one of the following: (i) 100 percent of the local payment amount if the local payment amount is neither greater than the weighted average nor less than 85 percent of the weighted average of all local payment amounts. (ii) 100 percent of the weighted average of all local payment amounts if the local payment amount exceeds the weighted average of all local payment amounts. (iii) 85 percent of the weighted average of all local payment amounts if the local payment amount is less than 85 percent of the weighted average of all local payment amounts. (4) For 1994 and subsequent years, the national limited payment amount is equal to one of the following: (i) If the local payment amount is not in excess of the median, nor less than 85 percent of the median, of all local payment amounts—100 percent of the local payment amount. (ii) If the local payment amount exceeds the median—100 percent of the median of all local payment amounts. (iii) If the local payment amount is less than 85 percent of the median—85 percent of the median of all local payment amounts. (g) Payment for surgical dressings. [57 FR 57689, Dec. 7, 1992, as amended at 60 FR 35497, July 10, 1995] § 414.222 Items requiring frequent and substantial servicing. (a) Definition. (1) Ventilators (except those that are either continuous airway pressure devices or respiratory assist devices with bi-level pressure capability with or without a backup rate, previously referred to as “intermittent assist devices with continuous airway pressure devices”). (2) Continuous and intermittent positive pressure breathing machines. (3) Continuous passive motion machines. (4) Other items specified in CMS program instructions. (5) Other items identified by the carrier. (b) Payment rule. (c) Fee schedule amount for 1989 and 1990. (1) The carrier determines the average reasonable charge for rental of items requiring frequent and substantial servicing that were furnished during the period July 1, 1986 through June 30, 1987 based on the mean of the carrier's allowed charges for the item. (2) The carrier adjusts the amounts determined under paragraph (c)(1) of this section by the change in the level of the CPI-U for the 6-month period ending December 1987. (d) Updating the fee schedule amounts for years after 1990. (e) Transition to other payment classes. (f) Multi-function ventilators (2) Payment rule. (3) Monthly cost for additional functions. (ii) For functions performed by items classified under § 414.220, the monthly cost is equal to the fee schedule amount for purchased equipment established in § 414.220(c), (d), (e), and (f), adjusted in accordance with § 414.210(g), divided by 60 months or total number of months of the reasonable useful lifetime of the equipment. (iii) For functions performed by items classified under § 414.226, the monthly cost is equal to the monthly payment amount established in § 414.226(e) and (f), adjusted in accordance with § 414.210(g), multiplied by 36 and divided by 60 months or total number of months of the reasonable useful lifetime of the oxygen equipment. (iv) For functions performed by items classified under § 414.229, the monthly cost is equal to the purchase price established in § 414.229(c), adjusted in accordance with § 414.210(g), divided by 60 months or total number of months of the reasonable useful lifetime of the equipment. [57 FR 57690, Dec. 7, 1992, as amended at 60 FR 35497, July 10, 1995; 71 FR 4525, Jan. 27, 2006; 83 FR 57071, Nov. 14, 2018] § 414.224 Customized items. (a) Criteria for a customized item. (b) Payment rule. [56 FR 65998, Dec. 20, 1991, as amended at 58 FR 34919, June 30, 1993] § 414.226 Oxygen and oxygen equipment. (a) Payment rules Oxygen equipment. (2) Oxygen contents. (b) Monthly fee schedule amount for items furnished prior to 2007. (i) Stationary oxygen equipment and oxygen contents (stationary and portable oxygen contents). (ii) Portable oxygen equipment only. (iii) Stationary and portable oxygen contents only. (iv) Portable oxygen contents only. (2) For 1989 and 1990, the monthly fee schedule amounts are the local payment amounts determined as follows: (i) The carrier determines the base local average monthly payment rate equal to the total reasonable charges for the item for the 12-month period ending December 1986 divided by the total number of months for all beneficiaries receiving the item for the same period. In determining the local average monthly payment rate, the following limitations apply: (A) Purchase charges for oxygen systems are not included as items classified under paragraph (b)(1)(i) of this section. (B) Purchase charges for portable equipment are not included as items classified under paragraph (b)(1)(ii) of this section. (ii) The carrier determines the local monthly payment amount equal to 0.95 times the base local average monthly payment amount adjusted by the change in the CPI-U for the six-month period ending December 1987. (3) For 1991 through 2006, the fee schedule amounts for items described in paragraphs (b)(1)(iii) and (iv) of this section are determined using the methodology contained in § 414.220(d), (e), and (f). (4) For 1991 through 2006, the fee schedule amounts for items described in paragraphs (b)(1)(i) and (ii) of this section are determined using the methodology contained in § 414.220(d), (e), and (f). (5) For 2005 and 2006, the fee schedule amounts determined under paragraph (b)(4) of this section are reduced using the methodology described in section 1834(a)(21)(A) of the Act. (c) Monthly fee schedule amount for items furnished from 2007 through 2018. (i) Stationary oxygen equipment (including stationary concentrators) and oxygen contents (stationary and portable). (ii) Portable equipment only (gaseous or liquid tanks). (iii) Oxygen generating portable equipment only. (iv) Stationary oxygen contents only. (v) Portable oxygen contents only. (2) The national limited monthly payment rate for items described in paragraph (c)(1)(i) of this section is equal to the weighted average fee schedule amount established under paragraph (b)(5) of this section reduced by $1.44. (3) The national limited monthly payment rate for items described in paragraph (c)(1)(ii) of this section is equal to the weighted average of the fee schedule amounts established under paragraph (b)(5) of this section. (4) The national limited monthly payment rate for items described in paragraph (c)(1)(iii) of this section is equal to the national limited monthly payment rate established under paragraph (c)(5) of this section, multiplied by 24, and divided by 36. (5) The national limited monthly payment rate for items described in paragraphs (c)(1)(iv) and (c)(1)(v) of this section is equal to 50 percent of the weighted average fee schedule amounts established under paragraph (b)(3) of this section for items described in paragraph (b)(1)(iii) of this section. (6) For 2008 through 2018, CMS makes an annual adjustment to the national limited monthly payment rate for items described in paragraph (c)(1)(i) of this section to ensure that such payment rates do not result in expenditures for any year that are more or less than the expenditures that would have been made if such classes had not been established. (d) Application of monthly fee schedule amounts for items furnished from 2007 through 2018. (2) Subject to the limitation set forth in paragraph (g)(2) of this section, the fee schedule amount for items described in paragraphs (c)(1)(ii) and (c)(1)(iii) of this section is paid when the beneficiary rents portable oxygen equipment. (3) The fee schedule amount for items described in paragraph (c)(1)(iv) of this section is paid when the beneficiary— (i) Owns stationary oxygen equipment that requires delivery of gaseous or liquid oxygen contents; or (ii) Rents stationary oxygen equipment that requires delivery of gaseous or liquid oxygen contents after the period of continuous use of 36 months described in paragraph (a)(1) of this section. (4) The fee schedule amount for items described in paragraph (c)(1)(v) of this section is paid when the beneficiary— (i) Owns portable oxygen equipment described in (c)(1)(ii) of this section; (ii) Rents portable oxygen equipment described in paragraph (c)(1)(ii) of this section during the period of continuous use of 36 months described in paragraph (a)(1) of this section and does not rent stationary oxygen equipment; or (iii) Rents portable oxygen equipment described in paragraph (c)(1)(ii) of this section after the period of continuous use of 36 months described in paragraph (a)(1) of this section. (e) Monthly fee schedule amount for items furnished for years after 2018. (i) Stationary oxygen equipment (including stationary concentrators) and oxygen contents (stationary and portable). (ii) Portable gaseous equipment only. (iii) Portable liquid equipment only. (iv) Oxygen generating portable equipment only. (v) Stationary oxygen contents only. (vi) Portable oxygen contents only, except for portable liquid oxygen contents for prescribed flow rates greater than four liters per minute. (vii) Portable liquid oxygen contents only for prescribed flow rates of more than 4 liters per minute. (2) The monthly payment rate for items described in paragraphs (e)(1)(i), (ii), (iv), (v), and (vi) of this section are determined using the applicable methodologies contained in § 414.210(g). (3) The monthly payment rate for items described in paragraph (e)(1)(iii) of this section is determined initially based on the monthly payment rate for items described in paragraph (e)(1)(iv) of this section and is subsequently adjusted using the applicable methodologies contained in § 414.210(g). (4) The monthly payment rate for items described in paragraph (e)(1)(vii) of this section is determined initially based on 150 percent of the monthly payment rate for items described in paragraph (e)(1)(vi) of this section and is subsequently adjusted using the applicable methodologies contained in § 414.210(g). (5) Beginning in 2019, CMS makes an annual adjustment to the monthly payment rate for items described in paragraphs (e)(1)(i) through (e)(1)(vii) of this section to ensure that such payment rates do not result in expenditures for any year that are more or less than the expenditures that would have been made if such classes had not been established. (f) Application of monthly fee schedule amounts for items furnished for years after 2018. (2) Subject to the limitation set forth in paragraph (g)(2) of this section, the fee schedule amount for items described in paragraphs (e)(1)(ii), (iii), and (iv) of this section is paid when the beneficiary rents portable oxygen equipment. (3) The fee schedule amount for items described in paragraph (e)(1)(v) of this section is paid when the beneficiary— (i) Owns stationary oxygen equipment that requires delivery of gaseous or liquid oxygen contents; or (ii) Rents stationary oxygen equipment that requires delivery of gaseous or liquid oxygen contents after the period of continuous use of 36 months described in paragraph (a)(1) of this section. (4) The fee schedule amount for items described in paragraph (e)(1)(vi) of this section is paid when the beneficiary— (i) Owns portable oxygen equipment described in paragraphs (e)(1)(ii) or (e)(1)(iii) of this section; or Code of Federal Regulations/Title 42—Public Health/Vol. 3/2017-10-0166 (ii) Rents portable oxygen equipment described in paragraphs (e)(1)(ii) or (e)(1)(iii) of this section during the period of continuous use of 36 months described in paragraph (a)(1) of this section and does not rent stationary oxygen equipment; or (iii) Rents portable oxygen equipment described in paragraphs (e)(1)(ii) or (e)(1)(iii) of this section after the period of continuous use of 36 months described in paragraph (a)(1) of this section. (5) The fee schedule amount for items described in paragraph (e)(1)(vii) of this section is paid when the beneficiary has a prescribed flow rate of more than 4 liters per minute and— (i) Owns portable liquid oxygen equipment described in paragraph (e)(1)(iii) of this section; or Code of Federal Regulations/Title 42—Public Health/Vol. 3/2017-10-0166 (ii) Rents portable liquid oxygen equipment described in paragraph (e)(1)(iii) of this section during the period of continuous use of 36 months described in paragraph (a)(1) of this section and does not rent stationary oxygen equipment; or (iii) Rents portable liquid oxygen equipment described in paragraph (e)(1)(iii) of this section after the period of continuous use of 36 months described in paragraph (a)(1) of this section. (g) Volume adjustments. (i) If the attending physician prescribes an oxygen flow rate exceeding four liters per minute, the fee schedule amount is increased by 50 percent, subject to the limit in paragraph (g)(2) of this section. (ii) If the attending physician prescribes an oxygen flow rate of less than one liter per minute, the fee schedule amount is decreased by 50 percent. (2) If portable oxygen equipment is used and the prescribed oxygen flow rate exceeds four liters per minute, the total fee schedule amount recognized for payment is limited to the higher of— (i) The sum of the monthly fee schedule amount for the items described in paragraphs (c)(1)(i) and (c)(1)(ii) or (c)(1)(iii) of this section; or (ii) The adjusted fee schedule amount described in paragraph (g)(1)(i) of this section. (3) In establishing the volume adjustment for those beneficiaries whose physicians prescribe varying flow rates, the following rules apply: (i) If the prescribed flow rate is different for stationary oxygen equipment than for portable oxygen equipment, the flow rate for the stationary equipment is used. (ii) If the prescribed flow rate is different for the patient at rest than for the patient at exercise, the flow rate for the patient at rest is used. (iii) If the prescribed flow rate is different for nighttime use and daytime use, the average of the two flow rates is used. (h) Furnishing oxygen and oxygen equipment after the 36-month rental cap. (i) Continue to furnish the equipment during any period of medical need for the remainder of the reasonable useful lifetime established for the equipment in accordance with § 414.210(f)(1); or (ii) Arrange for furnishing the oxygen equipment with another supplier if the beneficiary relocates to an area that is outside the normal service area of the supplier that initially furnished the equipment. (2) The supplier that furnishes liquid or gaseous oxygen equipment (stationary or portable) for the 36th continuous month during which payment is made under this section must— (i) Continue to furnish the oxygen contents necessary for the effective use of the liquid or gaseous equipment during any period of medical need for the remainder of the reasonable useful lifetime established for the equipment in accordance with § 414.210(f)(1); or (ii) Arrange for furnishing the oxygen contents with another supplier if the beneficiary relocates to an area that is outside the normal service area of the supplier that initially furnished the equipment. (i) Additional supplier requirements for rentals that begin on or after January 1, 2007. (i) The item becomes subject to a competitive acquisition program implemented in accordance with section 1847(a) of the Act; (ii) The beneficiary relocates to an area that is outside the normal service area of the supplier that initially furnished the equipment; (iii) The beneficiary elects to obtain oxygen equipment from a different supplier prior to the expiration of the 36-month rental period; or (iv) CMS or the carrier determines that an exception should apply in an individual case based on the circumstances. (2) Oxygen equipment furnished under this section may not be replaced by the supplier prior to the expiration of the reasonable useful lifetime established for the equipment in accordance with § 414.210(f)(1) unless: (i) The supplier replaces an item with the same, or equivalent, make and model of equipment because the item initially furnished was lost, stolen, irreparably damaged, is being repaired, or no longer functions; (ii) A physician orders different equipment for the beneficiary. If the order is based on medical necessity, then the order must indicate why the equipment initially furnished is no longer medically necessary and the supplier must retain this order in the beneficiary's medical record; (iii) The beneficiary chooses to obtain a newer technology item or upgraded item and signs an advanced beneficiary notice (ABN); or (iv) CMS or the carrier determines that a change in equipment is warranted. (3) Before furnishing oxygen equipment, the supplier must disclose to the beneficiary its intentions regarding whether it will accept assignment of all monthly rental claims for the duration of the rental period. A supplier's intentions could be expressed in the form of a written agreement between the supplier and the beneficiary. [57 FR 57690, Dec. 7, 1992, as amended at 71 FR 65933, Nov. 9, 2006; 73 FR 69936, Nov. 19, 2008; 78 FR 72253, Dec. 2, 2013; 83 FR 57071, Nov. 14, 2018] § 414.228 Prosthetic and orthotic devices. (a) Payment rule. (b) Fee schedule amounts. (1) The carrier determines a base local purchase price equal to the average reasonable charge for items purchased during the period July 1, 1986 through June 30, 1987 based on the mean of the carrier's allowed charges for the item. (2) The carrier determines a local purchase price equal to the following: (i) For 1989 and 1990, the base local purchase price is adjusted by the change in the level of the CPI-U for the 6-month period ending December 1987. (ii) For 1991 through 1993, the local purchase price for the preceding year is adjusted by the applicable percentage increase for the year. The applicable percentage increase is equal to 0 percent for 1991. For 1992 and 1993, the applicable percentage increase is equal to the percentage increase in the CPI-U for the 12-month period ending with June of the previous year. (iii) For 1994 and 1995, the applicable percentage increase is 0 percent. (iv) For all subsequent years the applicable percentage increase is equal to the percentage increase in the CPI-U for the 12-month period ending with June of the previous year. (3) CMS determines the regional purchase price equal to the following: (i) For 1992, the average (weighted by the relative volume of all claims among carriers) of the local purchase prices for the carriers in the region. (ii) For 1993 and subsequent years, the regional purchase price for the preceding year adjusted by the applicable percentage increase for the year. (4) CMS determines a purchase price equal to the following: (i) For 1989, 1990 and 1991, 100 percent of the local purchase price. (ii) For 1992, 75 percent of the local purchase price plus 25 percent of the regional purchase price. (iii) For 1993, 50 percent of the local purchase price plus 50 percent of the regional purchase price. (iv) For 1994 and subsequent years, 100 percent of the regional purchase price. (5) For 1992 and subsequent years, CMS determines a national average purchase price equal to the unweighted average of the purchase prices determined under paragraph (b)(4) of this section for all carriers. (6) CMS determines the fee schedule amount equal to 100 percent of the purchase price determined under paragraph (b)(4) of this section, subject to the following limitations: (i) For 1992, the amount cannot be greater than 125 percent nor less than 85 percent of the national average purchase price determined under paragraph (b)(5) of this section. (ii) For 1993 and subsequent years, the amount cannot be greater than 120 percent of the national average nor less than 90 percent of the national average purchase price determined under paragraph (b)(5) of this section. (c) Payment for therapeutic shoes. [57 FR 57691, Dec. 7, 1992, as amended at 60 FR 35498, July 10, 1995; 73 FR 69937, Nov. 19, 2008] § 414.229 Other durable medical equipment—capped rental items. (a) General payment rule. (1) For items furnished prior to January 1, 2006, payment is made on a rental or purchase option basis in accordance with the rules set forth in paragraphs (b) through (e) of this section. (2) For items other than power-driven wheelchairs furnished on or after January 1, 2006, payment is made in accordance with the rules set forth in paragraph (f) of this section. (3) For power-driven wheelchairs furnished on or after January 1, 2006 through December 31, 2010, payment is made in accordance with the rules set forth in paragraphs (f) or (h) of this section. (4) For power-driven wheelchairs that are not classified as complex rehabilitative power-driven wheelchairs, furnished on or after January 1, 2011, payment is made in accordance with the rules set forth in paragraph (f) of this section. (5) For power-driven wheelchairs classified as complex rehabilitative power-driven wheelchairs, furnished on or after January 1, 2011, payment is made in accordance with the rules set forth in paragraphs (f) or (h) of this section. (b) Fee schedule amounts for rental. (2) For 1991 and subsequent years, the monthly fee schedule amount for rental of other covered durable medical equipment equals 10 percent of the purchase price recognized as determined under paragraph (c) of this section for each of the first 3 months and 7.5 percent of the purchase price for each of the remaining months. (3) For power-driven wheelchairs furnished on or after January 1, 2011, the monthly fee schedule amount for rental equipment equals 15 percent of the purchase price recognized as determined under paragraph (c) of this section for each of the first 3 months and 6 percent of the purchase price for each of the remaining months. (c) Determination of purchase price. (1) For 1989 and 1990. (ii) The purchase price is equal to the base local purchase price adjusted by the change in the level of the CPI-U for the 6-month period ending December 1987. (2) For 1991. (ii) The purchase price for 1991 is the national limited payment amount as determined using the methodology contained in § 414.220(f). (3) For years after 1991. (d) Purchase option. (1) Suppliers must offer beneficiaries the option of purchasing power-driven wheelchairs at the time the supplier first furnishes the item. On or after January 1, 2011, this option is available only for complex rehabilitative power-driven wheelchairs. Payment must be on a lump-sum fee schedule purchase basis if the beneficiary chooses the purchase option. The purchase fee is the amount established in paragraph (c) of this section. (2) Suppliers must offer beneficiaries the option of converting capped rental items (including power-driven wheelchairs not purchased when initially furnished) to purchased equipment during their 10th continuous rental month. Beneficiaries have one month from the date the supplier makes the offer to accept the purchase option. (i) If the beneficiary does not accept the purchase option, payment continues on a rental basis not to exceed a period of continuous use of longer than 15 months. After 15 months of rental payments have been paid, the supplier must continue to provide the item without charge, other than a charge for maintenance and servicing fees, until medical necessity ends or Medicare coverage ceases. A period of continuous use is determined under the provisions in § 414.230. (ii) If the beneficiary accepts the purchase option, payment continues on a rental basis not to exceed a period of continuous use of longer than 13 months. On the first day after 13 continuous rental months during which payment is made, the supplier must transfer title to the equipment to the beneficiary. (e) Payment for maintenance and servicing. (2) Payment of the fee for maintenance and servicing of other durable medical equipment that is rented is made only for equipment that continues to be used after 15 months of rental payments have been made and is limited to the following: (i) For the first 6-month period, no payments are to be made. (ii) For each succeeding 6-month period, payment may be made during the first month of that period. (3) Payment for maintenance and servicing DME purchased in accordance with paragraphs (d)(1) and (d)(2)(ii) of this section, is made on the basis of reasonable and necessary charges. (f) Rules for capped rental items furnished beginning on or after January 1, 2006. (2) The supplier must transfer title to the item to the beneficiary on the first day that begins after the 13th continuous month in which payments are made under paragraph (f)(1) of this section. (3) Payment for maintenance and servicing of beneficiary-owned equipment is made in accordance with § 414.210(e). (g) Additional supplier requirements for capped rental items that are furnished beginning on or after January 1, 2007. (i) The item becomes subject to a competitive acquisition program implemented in accordance with section 1847(a) of the Act; (ii) The beneficiary relocates to an area that is outside the normal service area of the supplier that initially furnished the equipment; (iii) The beneficiary elects to obtain the equipment from a different supplier prior to the expiration of the 13-month rental period; or (iv) CMS or the carrier determines that an exception should apply in an individual case based on the circumstances. (2) A capped rental item furnished under this section may not be replaced by the supplier prior to the expiration of the 13-month rental period unless: (i) The supplier replaces an item with the same, or equivalent, make and model of equipment because the item initially furnished was lost, stolen, irreparably damaged, is being repaired, or no longer functions; (ii) A physician orders different equipment for the beneficiary. If the need for different equipment is based on medical necessity, then the order must indicate why the equipment initially furnished is no longer medically necessary and the supplier must retain this order in the beneficiary's medical record; (iii) The beneficiary chooses to obtain a newer technology item or upgraded item and signs an advanced beneficiary notice (ABN); or (iv) CMS or the carrier determines that a change in equipment is warranted. (3) Before furnishing a capped rental item, the supplier must disclose to the beneficiary its intentions regarding whether it will accept assignment of all monthly rental claims for the duration of the rental period. A supplier's intentions could be expressed in the form of a written agreement between the supplier and the beneficiary. (4) No later than two months before the date on which the supplier must transfer title to a capped rental item to the beneficiary, the supplier must disclose to the beneficiary whether it can maintain and service the item after the beneficiary acquires title to it. CMS or its carriers may make exceptions to this requirement on a case-by-case basis. (h) Purchase of power-driven wheelchairs furnished on or after January 1, 2006. (2) Payment is made on a lump-sum purchase basis if the beneficiary chooses this option. (3) On or after January 1, 2011, this option is available only for complex rehabilitative power-driven wheelchairs. [57 FR 57691, Dec. 7, 1992, as amended at 60 FR 35498, July 10, 1995; 71 FR 65934, Nov. 9, 2006; 75 FR 73622, Nov. 29, 2010] § 414.230 Determining a period of continuous use. (a) Scope. (b) Continuous use. (2) In the case of a beneficiary receiving oxygen equipment on December 31, 2005, the period of continuous use for the equipment begins on January 1, 2006. (c) Temporary interruption. (2) An interruption of not longer than 60 consecutive days plus the days remaining in the rental month in which use ceases is temporary, regardless of the reason for the interruption. (3) Unless there is a break in medical necessity that lasts longer than 60 consecutive days plus the days remaining in the rental month in which use ceases, medical necessity is presumed to continue. (d) Criteria for a new rental period. (1) A new prescription. (2) New medical necessity documentation. (3) A statement describing the reason for the interruption and demonstrating that medical necessity in the prior episode ended. (e) Beneficiary moves. (f) New equipment. (2) A new period of continuous use does not begin when a beneficiary changes from one stationary oxygen equipment modality to another or from one portable oxygen equipment modality to another. (g) New supplier. (h) Oxygen equipment furnished after the 36-month rental period. [56 FR 50823, Oct. 9, 1991, as amended at 57 FR 57111, Dec. 3, 1992; 71 FR 65935, Nov. 9, 2006; 73 FR 69937, Nov. 19, 2008; 83 FR 57072, Nov. 14, 2018] § 414.232 Special payment rules for transcutaneous electrical nerve stimulators (TENS). (a) General payment rule. (1) Effective April 1, 1990—the original payment amount is reduced by 15 percent. (2) Effective January 1, 1991—the reduced payment amount in paragraph (a)(1) is reduced by 15 percent. (3) Effective January 1, 1994—the reduced payment amount in paragraph (a)(1) is reduced by 45 percent. (b) Exception. [57 FR 57692, Dec. 7, 1992, as amended at 60 FR 35498, July 10, 1995] § 414.234 Prior authorization for items frequently subject to unnecessary utilization. (a) Definitions. Prior authorization Provisional affirmation Required Prior Authorization List Unnecessary utilization (b) Master List of Items Potentially Subject to Face-To-Face Encounter and Written Order Prior to Delivery and/or Prior Authorization Requirements. (i) Any DMEPOS items included in the DMEPOS Fee Schedule that have an average purchase fee of $500 (adjusted annually for inflation using consumer price index for all urban consumers (CPI-U), and reduced by the 10-year moving average of changes in annual economy-wide private nonfarm business multifactor productivity (MFP) (as projected by the Secretary for the 10-year period ending with the applicable FY, year, cost reporting period, or other annual period)) or greater, or an average monthly rental fee schedule of $50 (adjusted annually for inflation using consumer price index for all urban consumers (CPI-U), and reduced by the 10-year moving average of changes in annual economy-wide private nonfarm business multifactor productivity (MFP) (as projected by the Secretary for the 10-year period ending with the applicable FY, year, cost reporting period, or other annual period)) or greater, or are identified as accounting for at least 1.5 percent of Medicare expenditures for all DMEPOS items over a 12-month period that are: (A) Identified as having a high rate of potential fraud or unnecessary utilization in an Office of Inspector General (OIG) or Government Accountability Office (GAO) report that is national in scope and published in 2015 or later, or (B) Listed in the 2018 or later Comprehensive Error Rate Testing (CERT) Medicare Fee-for-Service (FFS) Supplemental Improper Payment Data report as having a high improper payment rate, or (ii) The annual Master List updates shall include any items with at least 1,000 claims and 1 million dollars in payments during a recent 12-month period that are determined to have aberrant billing patterns and lack explanatory contributing factors (for example, new technology or coverage policies). Items with aberrant billing patterns would be identified as those items with payments during a 12-month timeframe that exceed payments made during the preceding 12-months, by the greater of: (A) Double the percent change of all DMEPOS claim payments for items that meet the above claim and payment criteria, from the preceding 12-month period, or (B) Exceeding a 30 percent increase in payment, or (iii) Any item statutorily requiring a face-to-face encounter, a written order prior to delivery, or prior authorization. (2) The Master List is self-updating at a minimum annually, and is published in the Federal Register (3) DMEPOS items identified as having a high rate of fraud or unnecessary utilization in any of the following reports that are national in scope and meeting the payment threshold criteria set forth in paragraph (b)(1) of this section are added to the Master List: (i) OIG reports published after 2020. (ii) GAO reports published after 2020. (iii) Listed in the CERT Medicare FFS Supplemental Improper Payment Data report(s) published after 2020 as having a high improper payment rate. (4) Items are removed from the Master List after 10 years from the date the item was added to the Master List, unless the item was identified in an OIG report, GAO report, or having been identified in the CERT Medicare FFS Supplemental Improper Payment Data report as having a high improper payment rate, within the 5-year period preceding the anticipated date of expiration. (5) Items that are discontinued or are no longer covered by Medicare are removed from the Master List. (6) An item is removed from the list if the cost drops below the payment threshold criteria set forth in paragraph (b)(1)(i) of this section. (7) An item is removed from the Master List and replaced by its equivalent when the Healthcare Common Procedure Coding System (HCPCS) code representing the item has been discontinued and cross-walked to an equivalent item. (c) Condition of payment Items requiring prior authorization. Federal Register (i) The Required Prior Authorization List specified in paragraph (c)(1) of this section is selected from the Master List. CMS may consider factors such as geographic location, item utilization or cost, system capabilities, emerging trends, vulnerabilities identified in official agency reports, or other analysis and may implement prior authorization nationally or locally. (ii) CMS may elect to limit the prior authorization requirement to a particular region of the country if claims data analysis shows that unnecessary utilization of the selected item(s) is concentrated in a particular region. CMS may elect to exempt suppliers from prior authorization upon demonstration of compliance with Medicare coverage, coding, and payment rules through such prior authorization process. (A) An exemption is provided for a supplier that achieves a rate of payable claims submitted, based on Medicare's billing, coding or payment requirements, of at least 90 percent during an initial or periodic review and remains in effect until CMS withdraws the exemption. An exemption of a supplier is withdrawn if the rate of non-payable claims submitted, based on Medicare's billing, coding or payment requirements, becomes higher than 10 percent, based upon a periodic assessment. (B) CMS provides a notice of an exemption or withdrawal of an exemption to the supplier at least 60 days before the effective date. (iii) The Required Prior Authorization List is effective no less than 60 days after publication and posting. (2) Denial of claims. (ii) Claims receiving a provisional affirmation may be denied based on either of the following: (A) Technical requirements that can only be evaluated after the claim has been submitted for formal processing. (B) Information not available at the time of a prior authorization request. (d) Submission of prior authorization requests. (1) Include all relevant documentation necessary to show that the item meets applicable Medicare coverage, coding, and payment rules, including those outlined in § 410.38 and all of the following: (i) Written order/prescription. (ii) Relevant information from the beneficiary's medical record. (iii) Relevant supplier produced documentation. (2) Be submitted before the item is furnished to the beneficiary and before the claim is submitted for processing. (e) Review of prior authorization requests. (2) If applicable Medicare coverage, coding, and payment rules are met, CMS or its contractor issues a provisional affirmation to the requester. (3) If applicable Medicare coverage, coding, and payment rules are not met, CMS or its contractor issues a non-affirmation decision to the requester. (4) If the requester receives a non-affirmation decision, the requester may resubmit a prior authorization request before the item is furnished to the beneficiary and before the claim is submitted for processing. (5) A prior authorization request for an expedited review must include documentation that shows that processing a prior authorization request using a standard timeline for review could seriously jeopardize the life or health of the beneficiary or the beneficiary's ability to regain maximum function. If CMS or its contractor agrees that processing a prior authorization request using a standard timeline for review could seriously jeopardize the life or health of the beneficiary or the beneficiary's ability to regain maximum function, then CMS or its contractor expedites the review of the prior authorization request and communicates the decision following the receipt of all applicable Medicare required documentation. (f) Suspension of prior authorization requests. (2) CMS provides notification of the suspension of the prior authorization requirements via— (i) Federal Register (ii) Posting on the CMS prior authorization Web site. [80 FR 81706, Dec. 30, 2015, as amended at 84 FR 60807, Nov. 8, 2019; 90 FR 55603, Dec. 2, 2025] § 414.236 Continuity of pricing when HCPCS codes are divided or combined. (a) General rule. (b) Mapping fee schedule amounts based on different kinds of coding changes. [84 FR 60808, Nov. 8, 2019] § 414.238 Establishing fee schedule amounts for new HCPCS codes for items and services without a fee schedule pricing history. (a) General rule. (b) Comparability. (c) Use of supplier or commercial price lists. (i) The annual deflation factors are specified in program instructions and are based on the percentage change in the consumer price index for all urban consumers (CPI-U) from the mid-point of the year the prices are in effect to the mid-point of the fee schedule base period, as calculated using the following formula: ((base CPI-U minus current CPI-U) divided by current CPI-U) plus one. (ii) The deflated amounts are then increased by the update factors specified in section 1834(a)(14) of the Act for DME, section 1834(h)(4) of the Act for prosthetic devices, prosthetics, orthotics, and therapeutic shoes and inserts, and section 1834(i)(1)(B) of the Act for surgical dressings. (2) If within 5 years of establishing fee schedule amounts using supplier or commercial prices, the prices decrease by less than 15 percent, a one-time adjustment to the fee schedule amounts is made using the new prices. The new prices would be used to establish the new fee schedule amounts in the same way that the older prices were used, including application of the deflation formula in paragraph (c)(1) of this section. [84 FR 60808, Nov. 8, 2019] § 414.240 Procedures for making benefit category determinations and payment determinations for new durable medical equipment, prosthetic devices, orthotics and prosthetics, surgical dressings, and therapeutic shoes and inserts. (a) Definitions. Benefit category determination (b) General rule. (1) At the start of a HCPCS coding cycle, CMS performs an analysis to determine if the item or service is statutorily excluded from coverage under Medicare under section 1862 of the Act, and, if not excluded by statute, whether the item or service is durable medical equipment, a prosthetic device as further defined under section 1834(h)(4) of the Act, an orthotic or prosthetic, a surgical dressing, or a therapeutic shoe or insert. (2) If a preliminary determination is made that the item or service is durable medical equipment, a prosthetic device, an orthotic or prosthetic, a surgical dressing, or a therapeutic shoe or insert, CMS makes a preliminary payment determination for the item or service. (3) CMS posts preliminary benefit category determinations and payment determinations on CMS.gov (4) After consideration of public consultation provided at a public meeting on preliminary benefit category determinations and payment determinations for items and services, CMS establishes the benefit category determinations and payment determinations for items and services through program instructions. [86 FR 73911, Dec. 28, 2021] Subpart E—Determination of Reasonable Charges Under the ESRD Program § 414.300 Scope of subpart. This subpart sets forth criteria and procedures for payment of the following services furnished to ESRD patients: (a) Physician services related to renal dialysis. (b) Physician services related to renal transplantation. (c) Home dialysis equipment, supplies, and support services. (d) Epoetin (EPO) furnished by a supplier of home dialysis equipment and supplies to a home dialysis patient for use in the home. [55 FR 23441, June 8, 1990, as amended at 56 FR 43710, Sept. 4, 1991; 59 FR 1285, Jan. 10, 1994] § 414.310 Determination of reasonable charges for physician services furnished to renal dialysis patients. (a) Principle. (b) Scope and applicability Scope. (i) Outpatient maintenance dialysis patients who dialyze— (A) In an independent or hospital-based ESRD facility, or (B) At home. (ii) Hospital inpatients for which the physician elects to continue payment under the monthly capitation payment (MCP) method described in § 414.314. (2) Applicability. (c) Definitions. Administrative services Dialysis session Medical direction, Routine professional services (1) They are personally furnished by a physician to an individual patient. (2) They contribute directly to the diagnosis or treatment of an individual patient. (3) They ordinarily must be performed by a physician. Supervision of staff, (d) Types of routine professional services. (1) Visits to the patient during dialysis, and review of laboratory test results, nurses' notes and any other medical documentation, as a basis for— (i) Adjustment of the patient's medication or diet, or the dialysis procedure; (ii) Prescription of medical supplies; and (iii) Evaluation of the patient's psychosocial status and the appropriateness of the treatment modality. (2) Medical direction of staff in delivering services to a patient during a dialysis session. (3) Pre-dialysis and post-dialysis examinations, or examinations that could have been furnished on a pre-dialysis or post-dialysis basis. (4) Insertion of catheters for patients who are on peritoneal dialysis and do not have indwelling catheters. (e) Payment for routine professional services. § 414.313 Initial method of payment. (a) Basic rule. (b) Services for which payment is not included in the add-on payment. (2) The carrier pays the physician or the beneficiary (as appropriate) under the reasonable charge criteria set forth in subpart E of part 405 of this chapter for the following services: (i) Physician services that must be furnished at a time other than during the dialysis session (excluding pre-dialysis and post-dialysis examinations and examinations that could have been furnished on a pre-dialysis or post-dialysis basis), such as monthly and semi-annual examinations to review health status and treatment. (ii) Physician surgical services other than insertion of catheters for patients who are on peritoneal dialysis and do not have indwelling catheters. (iii) Physician services furnished to hospital inpatients who were not admitted solely to receive maintenance dialysis. (iv) Administration of hepatitis B vaccine. (c) Physician election of the initial method. (2) The initial method of payment applies to dialysis services furnished beginning with the second calendar month after the month in which all physicians in the facility elect the initial method and continues until the effective date of a termination of the election described in paragraph (d) of this section. (d) Termination of the initial method. (2) If the notice terminating the initial method is received by the carrier(s) and intermediary— (i) On or before November 1, the effective date of the termination is January 1 of the year following the calendar year in which the termination notice is received by the carrier(s) and intermediary; or (ii) After November 1, the effective date of the termination is January 1 of the second year after the calendar year in which the notice is received by the carrier(s) and intermediary. (e) Determination of payment amount. (f) Publication of payment amount. Federal Register [55 FR 23441, June 8, 1990, as amended at 62 FR 43674, Aug. 15, 1997] § 414.314 Monthly capitation payment method. (a) Basic rules. (2) The carrier pays the MCP amount, subject to the deductible and coinsurance provisions, either to the physician if the physician accepts assignment or to the beneficiary if the physician does not accept assignment. (3) The MCP method recognizes the need of maintenance dialysis patients for physician services furnished periodically over relatively long periods of time, and the capitation amounts are consistent with physicians' charging patterns in their localities. (4) Payment of the capitation amount for any particular month is contingent upon the physician furnishing to the patient all physician services required by the patient during the month, except those listed in paragraph (b) of this section. (5) Payment for physician administrative services (§ 414.310) is made to the dialysis facility as part of the facility's composite rate (part 413, subpart H of this subchapter) and not to the physician under the MCP. (b) Services not included in the MCP. (i) Administration of hepatitis B vaccine. (ii) Covered physician services furnished by another physician when the patient is not available to receive, or the attending physician is not available to furnish, the outpatient services as usual (see paragraph (b)(3) of this section). (iii) Covered physician services furnished to hospital inpatients, including services related to inpatient dialysis, by a physician who elects not to continue to receive the MCP during the period of inpatient stay. (iv) Surgical services, including declotting of shunts, other than the insertion of catheters for patients on maintenance peritoneal dialysis who do not have indwelling catheters. (v) Needed physician services that are— (A) Furnished by the physician furnishing renal care or by another physician; (B) Not related to the treatment of the patient's renal condition; and (C) Not furnished during a dialysis session or an office visit required because of the patient's renal condition. (2) For the services described in paragraph (b)(1)(v) of this section, the following rules apply: (i) The physician must provide documentation to show that the services are not related to the treatment of the patient's renal condition and that additional visits are required. (ii) The carrier's medical staff, acting on the basis of the documentation and appropriate medical consultation obtained by the carrier, determines whether additional payment for the additional services is warranted. (3) The MCP is reduced in proportion to the number of days the patient is— (i) Hospitalized and the physician elects to bill separately for services furnished during hospitalization; or (ii) Not attended by the physician or his or her substitute for any reason, including when the physician is not available to furnish patient care or when the patient is not available to receive care. (c) Determination of payment amount. [55 FR 23441, June 8, 1990, as amended at 59 FR 63463, Dec. 8, 1994; 62 FR 43674, Aug. 15, 1997] § 414.316 Payment for physician services to patients in training for self-dialysis and home dialysis. (a) For each patient, the carrier pays a flat amount that covers all physician services required to create the capacity for self-dialysis and home dialysis. (b) CMS determines the amount on the basis of program experience and reviews it periodically. (c) The payment is made at the end of the training course, is subject to the deductible and coinsurance provisions, and is in addition to any amounts payable under the initial or MCP methods set forth in §§ 414.313 and 414.314, respectively. (d) If the training is not completed, the payment amount is proportionate to the time spent in training. § 414.320 Determination of reasonable charges for physician renal transplantation services. (a) Comprehensive payment for services furnished during a 60-day period. (2) Additional sums, in amounts established on the basis of program experience, may be included in the comprehensive payment for other surgery performed concurrently with the transplant operation. (3) The amount of the comprehensive payment may not exceed the lower of the following: (i) The actual charges made for the services. (ii) Overall national payment levels established under the ESRD program and adjusted to give effect to variations in physician's charges throughout the nation. (These adjusted amounts are the maximum allowances in a carrier's service area for renal transplantation surgery and related services by surgeons.) (4) Maximum allowances computed under these instructions are revised at the beginning of each calendar year to the extent permitted by the lesser of the following: (i) Changes in the economic index as described in § 405.504(a)(3)(i) of this chapter. (ii) Percentage changes in the weighted average of the carrier's prevailing charges (before adjustment by the economic index) for— (A) A unilateral nephrectomy; or (B) Another medical or surgical service designated by CMS for this purpose. (b) Other payments. § 414.330 Payment for home dialysis equipment, supplies, and support services. (a) Equipment and supplies Basic rule. (2) Exception for equipment and supplies furnished prior to January 1, 2011. (i) The patient elects to obtain home dialysis equipment and supplies from a supplier that is not a Medicare approved dialysis facility. (ii) The patient certifies to CMS that he or she has only one supplier for all home dialysis equipment and supplies. This certification is made on CMS Form 382 (the “ESRD Beneficiary Selection” form). (iii) In writing, the supplier— (A) Agrees to receive Medicare payment for home dialysis supplies and equipment only on an assignment-related basis; and (B) Certifies to CMS that it has a written agreement with one Medicare approved dialysis facility or, if the beneficiary is also entitled to military or veteran's benefits, one military or Veterans Administration hospital, for each patient. (See part 494 of this chapter for the requirements for a Medicare approved dialysis facility.) Under the agreement, the facility or military or VA hospital agrees to the following: ( 1 ( 2 ( 3 ( 4 ( 5 ( 6 ( 7 (iv) The facility with which the agreement is made must be located within a reasonable distance from the patient's home (that is, located so that the facility can actually furnish the needed services in a practical and timely manner, taking into account variables like the terrain, whether the patient's home is located in an urban or rural area, the availability of transportation, and the usual distances traveled by patients in the area to obtain health care services). (C) Agrees to report to the ESRD facility providing support services, at least every 45 days, all data (meaning information showing what supplies and services were provided to the patient and when each was provided) for each patient regarding services and items furnished to the patient in accordance with § 494.100(c)(2) of this chapter. (b) Support services Basic rule. (2) Exception for home support services furnished prior to January 1, 2011. (i) For support services furnished by a hospital-based ESRD facility, Medicare pays on a reasonable cost basis in accordance with part 413 of this chapter. (ii) For support services furnished by an independent ESRD facility, Medicare pays on the basis of reasonable charges that are related to costs and allowances that are reasonable when the services are furnished in an effective and economical manner. (c) Payment limits for support services, equipment and supplies, and notification of changes to the payment limits apply prior to January 1, 2011 as follows: (1) Support services. (2) Equipment and supplies. (3) Notification of changes to the payment limits. Federal Register Federal Register [57 FR 54187, Nov. 17, 1992, as amended at 73 FR 20474, Apr. 15, 2008; 75 FR 49202, Aug. 12, 2010] § 414.335 Payment for EPO furnished to a home dialysis patient for use in the home. (a) Prior to January 1, 2011, payment for EPO used at home by a home dialysis patient is made only to either a Medicare approved ESRD facility or a supplier of home dialysis equipment and supplies. Effective January 1, 2011, payment for EPO used at home by a home dialysis patient is made only to a Medicare-approved ESRD facility in accordance with the per treatment payment as defined in § 413.230. (b) After January 1, 2011, a home and self training amount is added to the per treatment base rate for adult and pediatric patients as defined in § 413.230 [75 FR 49202, Aug. 12, 2010] Subpart F—Competitive Bidding for Certain Durable Medical Equipment, Prosthetics, Orthotics, and Supplies (DMEPOS) § 414.400 Purpose and basis. This subpart implements competitive bidding programs for certain DMEPOS items as required by sections 1847(a) and (b) of the Act. [72 FR 18084, Apr. 10, 2007] § 414.402 Definitions. For purposes of this subpart, the following definitions apply: Adjusted fee schedule amount (1) Subpart C of this part, with the application of § 414.105. (2) Subpart D of this part, with the application of § 414.210(g). (3) Subpart Q of this part, with the application of § 414.1690. Affected party Bid Bidding entity Breach of contract Competition Competitive bidding area (CBA) Competitive bidding program (CBP) Composite bid Contract supplier Corrective action plan (CAP) Covered document Covered document review date (1) The date that is 30 days before the final date for the closing of the bid window; or (2) The date that is 30 days after the opening of the bid window. DMEPOS Grandfathered item (1) An inexpensive or routinely purchased item described in § 414.220 of this part. (2) An item requiring frequent and substantial servicing, as described in § 414.222 of this part. (3) Oxygen and oxygen equipment described in § 414.226 of this part. (4) Other DME described in § 414.229 of this part. Grandfathered supplier Hearing officer Hospital Item (1) DME other than class III devices under the Federal Food, Drug and Cosmetic Act, as defined in § 414.402, group 3 complex rehabilitative power wheelchairs, complex rehabilitative manual wheelchairs, manual wheelchairs described by HCPCS codes E1235, E1236, E1237, E1238, and K0008, and related accessories when furnished in connection with such wheelchairs, and further classified into the following categories: (i) Inexpensive or routinely purchased items, as specified in § 414.220(a). (ii) Items requiring frequent and substantial servicing, as specified in § 414.222(a). (iii) Oxygen and oxygen equipment, as specified in § 414.226(c)(1). (iv) Other DME (capped rental items), as specified in § 414.229. (2) Supplies necessary for the effective use of DME other than inhalation and infusion drugs. (3) Enteral nutrients, equipment, and supplies. (4) Off-the-shelf orthotics, which are orthotics described in section 1861(s)(9) of the Act that require minimal self-adjustment for appropriate use and do not require expertise in trimming, bending, molding, assembling or customizing to fit a beneficiary. (5) Lymphedema compression treatment items. (6) Other medical equipment described in section 1861(m)(5) of the Act, including supplies related to ostomy care and urological supplies. Item weight Lead item Mail order contract supplier Mail order item Metropolitan Statistical Area (MSA) Minimal self-adjustment National mail order DMEPOS competitive bidding program Nationwide competitive bidding area Nationwide mail order contract supplier Network Noncontract supplier Non-mail order item Parties to the hearing Physician Pivotal bid Price inversion e.g., e.g., Product category Regional competitive bidding area Regional mail order contract supplier Remote item delivery competitive bidding program Remote item delivery item Single payment amount Small supplier Supplier Total nationwide allowed services Treating practitioner Unadjusted fee schedule amount (1) Subpart C of this part, without the application of § 414.105. (2) Subpart D of this part, without the application of § 414.210(g). (3) Subpart Q of this part, without the application of § 414.1690. Weighted bid [72 FR 18084, Apr. 10, 2007, as amended at 74 FR 2880, Jan. 16, 2009; 74 FR 62009, Nov. 25, 2009; 75 FR 73622, Nov. 29, 2010; 76 FR 70314, Nov. 10, 2011; 81 FR 77966, Nov. 4, 2016; 83 FR 21925, May 11, 2018; 83 FR 57072, Nov. 14, 2018; 86 FR 42422, Aug. 4, 2021; 88 FR 77875, Nov. 13, 2023; 90 FR 55603, Dec. 2, 2025] § 414.404 Scope and applicability. (a) Applicability. (b) Exceptions. (i) The items furnished are limited to crutches, canes, walkers, folding manual wheelchairs, blood glucose monitors, and infusion pumps that are DME, and off-the-shelf (OTS) orthotics. (ii) The items are furnished by the physician or treating practitioner to his or her own patients as part of his or her professional service or by a hospital to its own patients during an admission or on the date of discharge. (iii) The items are billed under a billing number assigned to the hospital, physician, the treating practitioner (if possible), or a group practice to which the physician or treating practitioner has reassigned the right to receive Medicare payment. (2) A physical therapist in private practice (as defined in § 410.60(c) of this chapter) or an occupational therapist in private practice (as defined in § 410.59(c) of this chapter) may furnish competitively bid off-the-shelf orthotics without submitting a bid and being awarded a contract under this subpart, provided that the items are furnished only to the therapist's own patients as part of the physical or occupational therapy service. (3) Payment for items furnished in accordance with paragraphs (b)(1) and (b)(2) of this section will be paid in accordance with § 414.408(a). [72 FR 18084, Apr. 10, 2007, as amended at 74 FR 2880, Jan. 16, 2009; 75 FR 73623, Nov. 29, 2010; 76 FR 70314, Nov. 10, 2011] § 414.406 Implementation of programs. (a) Implementation contractor. (b) Competitive bidding areas. (c) Revisions to competitive bidding areas. (d) Competitively bid items. (e) Claims processing. [71 FR 48409, Aug. 18, 2006, as amended at 72 FR 18085, Apr. 10, 2007] § 414.408 Payment rules. (a) Payment basis. (2) If an item that is included in a competitive bidding program is furnished to a beneficiary who does not maintain a permanent residence in a CBA, the payment basis for the item is 80 percent of the lesser of the actual charge for the item, or the applicable fee schedule amount for the item, as determined under subpart C or subpart D. (b) Changes to the single payment amount. (2) For the third year (12-month period) of a DMEPOS CBP supplier contract period, if applicable, the single payment amount for each item under each competitive bidding program is updated based on the percentage change in the Consumer Price Index for all Urban Consumers (CPI-U) for the 12-month period ending 6 months prior to the start of the third year of the applicable DMEPOS CBP supplier contract period. (3) In no case can the updated single payment amount for an item in the applicable CBA be greater than the unadjusted fee schedule amount for the item in such area or 110 percent of the adjusted fee schedule amount for the item in such area. (c) Payment on an assignment-related basis. (d) Applicability of advanced beneficiary notice. (e) Requirement to obtain competitively bid items from a contract supplier. General rule. (2) Exceptions. (ii) Medicare may make a secondary payment for an item furnished by a noncontract supplier that the beneficiary is required to use under his or her primary insurance policy. The provisions of this paragraph do not supersede Medicare secondary payer statutory and regulatory provisions, including the Medicare secondary payment rules located in §§ 411.32 and 411.33 of this subchapter, and payment will be calculated in accordance with those rules. (iii) If a beneficiary is outside of the CBA in which he or she maintains a permanent residence, he or she may obtain an item from a— (A) Contract supplier, if the beneficiary obtains the item in another CBA and the item is included in the competitive bidding program for that CBA; or (B) Supplier with a valid Medicare billing number, if the beneficiary obtains the item in an area that is not a CBA, or if the beneficiary obtains the item in another CBA but the item is not included in the competitive bidding program for that CBA. (iv) A physician, treating practitioner, physical therapist in private practice, occupational therapist in private practice, or hospital may furnish an item in accordance with § 414.404(b) of this subpart. (v) A Medicare enrolled provider or supplier, as the terms are defined under § 400.202 of this chapter, that is operated by the Indian Health Service (IHS) or a Tribe or Tribal organization in accordance with the Indian Self-Determination and Education Assistance Act (25 U.S.C. 5301, et seq. (3) Unless paragraph (e)(2) of this section applies: (i) Medicare will not make payment for an item furnished in violation of paragraph (e)(1) of this section, and (ii) A beneficiary has no financial liability to a noncontract supplier that furnishes an item included in the competitive bidding program for a CBA in violation of paragraph (e)(1) of this section, unless the beneficiary has signed an advanced beneficiary notice. (4) CMS separately designates the Medicare billing number of all noncontract suppliers to monitor compliance with paragraphs (e)(1) and (e)(2) of this section. (f) Purchased equipment. (2) Payment for used purchased durable medical equipment and enteral nutrition equipment is made in an amount equal to 75 percent of the single payment amounts calculated for new purchased equipment under paragraph (f)(1) of this section. (g) Purchased supplies and orthotics. (1) Supplies used in conjunction with durable medical equipment. (2) Enteral nutrients. (3) Enteral nutrition supplies. (4) OTS orthotics. (5) Lymphedema compression treatment items. (6) Other medical equipment described in section 1861(m)(5) of the Act, including supplies related to ostomy care and urological supplies. (h) Rented equipment Capped rental DME. (2) For contracts entered into beginning on or after January 1, 2011, the monthly fee schedule amount for rental of power wheelchairs equals 15 percent of the single payment amounts calculated for new durable medical equipment under paragraph (f)(1) of this section for each of the first 3 months, and 6 percent of the single payment amounts calculated for these items for each of the remaining months 4 through 13. (3) Additional payment to certain contract suppliers for capped rental DME. (ii) Medicare does not make payment to a contract supplier under paragraph (h)(3)(i) of this section if the contract supplier furnishes capped rental durable medical equipment to a beneficiary who previously rented the equipment from another contract supplier. (4) Maintenance and servicing of rented DME. (5) Payment for rented enteral nutrition equipment. (6) Maintenance and servicing of rented enteral nutrition equipment. (7) Payment for inexpensive or routinely purchased durable medical equipment. (8) Payment amounts for rented DME requiring frequent and substantial servicing General rule. (ii) Exception. (i) Monthly payment amounts for oxygen and oxygen equipment Basic payment amount. (2) Additional payment to certain contract suppliers. (A) If Medicare made 26 or less monthly payments to the former supplier, Medicare makes a monthly payment to the contract supplier for up to the number of months equal to the difference between 36 and the number of months for which payment was made to the former supplier. (B) If Medicare made 27 or more monthly payments to the former supplier, Medicare makes 10 monthly payments to the contract supplier. (ii) Payment is made using the methodology described in paragraph (i)(1) of this section. On the first day after the month in which the final rental payment is made under paragraph (i)(2)(i) of this section, the contract supplier must transfer title of the oxygen equipment to the beneficiary. (iii) Medicare does not make payment to a contract supplier under paragraph (i)(2) of this section if the contract supplier furnishes oxygen equipment to a beneficiary who previously rented the equipment from another contract supplier. (j) Special rules for certain rented durable medical equipment and oxygen and oxygen equipment Supplier election. (ii) A supplier that elects to be a grandfathered supplier must continue to furnish the grandfathered items to all beneficiaries who elect to continue receiving the grandfathered items from that supplier for the remainder of the rental period for that item. (2) Payment for grandfathered items furnished during the first competitive bidding program implemented in a CBA. (i) For inexpensive and routinely purchased items described in § 414.220(a), payment is made in the amount determined under § 414.220(b). (ii) For other durable medical equipment or capped rental items described in § 414.229, payment is made in the amount determined under § 414.229(b). (iii) For items requiring frequent and substantial servicing described in § 414.222, payment is made in accordance with paragraph (a)(1) of this section. (iv) For oxygen and oxygen equipment described in § 414.226(c)(1), payment is made in accordance with paragraph (a)(1) of this section. (3) Payment for grandfathered items furnished during all subsequent competitive bidding programs in a CBA. (4) Choice of suppliers. (ii) A beneficiary who is otherwise entitled to obtain a grandfathered item from a grandfathered supplier under paragraph (j) of this section may elect to obtain the same item from a contract supplier at any time after a competitive bidding program is implemented. (iii) If a beneficiary elects to obtain the same item from a contract supplier, payment is made for the item accordance with paragraph (a)(1) of this section. (5) Notification of beneficiaries and CMS by suppliers that choose to become grandfathered suppliers. Notification of beneficiaries by suppliers. Requirements of notification. ( 1 ( 2 ( 3 ( 4 ( 5 ( 6 ( 7 http://www.Medicare.gov. (B) Record of beneficiary's choice. (C) Notification. ( 1 10-day notification: ( 2 2-day notification: (D) Pickup procedures. 1 ( 2 ( 3 ( 4 ( 5 (ii) Notification to CMS by suppliers. (A) State that the supplier agrees to continue to furnish certain rented DME, oxygen and oxygen equipment that it is currently furnishing to beneficiaries (that is, before the start of the competitive bidding program) in a CBA and will continue to provide these items to these beneficiaries for the remaining months of the rental period. (B) Include the following information: ( 1 ( 2 ( 3 (C) State that the supplier agrees to meet all the terms and conditions pertaining to grandfathered suppliers. (D) Be provided by the supplier to CMS in writing at least 30 business days before the start date of the implementation of the Medicare DMEPOS Competitive Bidding Program. (6) Suppliers that choose not to become grandfathered suppliers. Requirement for non-grandfathered supplier. (ii) Notification. (iii) Requirements of notification. (A) State that, for those items for which the supplier has decided not to be a grandfathered supplier, the supplier will only continue to rent these competitively bid item(s) to its beneficiaries up to the first anniversary date that occurs after the start of the Medicare DMEPOS Competitive Bidding Program. (B) State that the beneficiary must select a contract supplier for Medicare to continue to pay for these items. (C) Refer the beneficiary to the contract supplier locator tool on and to 1-800-MEDICARE to obtain information about the availability of contract suppliers for the beneficiary's area. (iv) Pickup procedures. (B) Under no circumstance should a supplier pick up a rented item prior to the supplier's receiving acknowledgement from the beneficiary that the beneficiary is aware of the date on which the supplier is picking up the item and the beneficiary has made arrangements to have the item replaced on that date by a contract supplier. (C) When a beneficiary chooses to switch to a new contract supplier, the current noncontract supplier and the new contract supplier must make arrangements that are agreeable to the beneficiary. (D) The contract supplier cannot submit a claim with a date of delivery for the new equipment that is prior to the first anniversary date that occurs after the beginning of the CBP. (7) Payment for accessories and supplies for grandfathered items. (k) Payment for maintenance, servicing and replacement of beneficiary-owned items. (i) Payment for labor is made in accordance with § 414.210(e)(1) of subpart D. (ii) Payment for parts that are not items (as defined in § 414.402) is made in accordance with § 414.210(e)(1) of subpart D. (iii) Payment for parts that are items (as defined in § 414.402) is made in accordance with paragraph (a)(1) of this section. (2) Additional payments are made in accordance with § 414.210(e)(2), (e)(3) and (e)(5) of this part for the maintenance and servicing of oxygen equipment if performed by a contract supplier or a noncontract supplier having a valid Medicare billing number. (3) Beneficiaries must obtain a replacement of a beneficiary-owned item, other than parts needed for the repair of beneficiary-owned equipment from a contract supplier. Payment is made for the replacement item in accordance with paragraph (a)(1) of this section. (l) Exceptions for certain items and services paid in accordance with special payment rules. (m) Special temporary transition rules for payment for supplies and accessories necessary for the effective use of beneficiary-owned continuous glucose monitors and insulin infusion pumps. [72 FR 18085, Apr. 10, 2007, as amended at 74 FR 2880, Jan. 16, 2009; 74 FR 62009, Nov. 25, 2009; 75 FR 73623, Nov. 29, 2010; 76 FR 70315, Nov. 10, 2011; 79 FR 66264, Nov. 6, 2014; 88 FR 77875, Nov. 13, 2023; 90 FR 55604, Dec. 2, 2025] § 414.409 Special payment rules. (a) Payment on a bundled, continuous rental basis. (b) Payment for grandfathered DME items paid on a bundled, continuous rental basis. (c) Supplier transitions for DME paid on a bundled, continuous rental basis. (d) Responsibility for repair and maintenance and servicing of power wheelchairs. [79 FR 66264, Nov. 6, 2014] § 414.410 Phased-in implementation of competitive bidding programs. (a) Phase-in of competitive bidding programs. (1) In CY 2009, in Cincinnati—Middletown (Ohio, Kentucky and Indiana), Cleveland—Elyria—Mentor (Ohio), Charlotte—Gastonia—Concord (North Carolina and South Carolina), Dallas—Fort Worth—Arlington (Texas), Kansas City (Missouri and Kansas), Miami—Fort Lauderdale—Miami Beach (Florida), Orlando (Florida), Pittsburgh (Pennsylvania), and Riverside—San Bernardino—Ontario (California). (2) In CY 2011, in an additional 91 MSAs (the additional 70 MSAs selected by CMS as of June 1, 2008, and the next 21 largest MSAs by total population based on 2009 population estimates, and not already phased in as of June 1, 2008). CMS may subdivide any of the 91 MSAs with a population of greater than 8,000,000 into separate CBAs, thereby resulting in more than 91 CBAs. (3) After CY 2011, additional CBAs (or, in the case of national mail order for items and services, after CY 2010). (4) For competitions (other than for national mail order items and services) after CY 2011 and prior to CY 2015, the following areas are excluded: (i) Rural areas. (ii) MSAs not selected under paragraphs (a)(1) or (a)(2) of this section with a population of less than 250,000. (iii) An area with low population density within an MSA not selected under paragraphs (a)(1) or (a)(2) of this section. (b) Selection of MSAs for CY 2007 and CY 2009. (1) The total population of an MSA. (2) The Medicare allowed charges for DMEPOS items per fee-for-service beneficiary in an MSA. (3) The total number of DMEPOS suppliers per fee-for-service beneficiary who received DMEPOS items in an MSA. (4) An MSA's geographic location. (c) Exclusions from a CBA. (1) Low utilization of DMEPOS items by Medicare beneficiaries receiving fee-for-service benefits relative to similar geographic areas; (2) Low number of DMEPOS suppliers relative to similar geographic areas; or (3) Low number of Medicare fee-for-service beneficiaries relative to similar geographic areas. (d) Selection of additional CBAs after CY 2009. (2) Beginning after CY 2009, CMS may designate through program instructions or by other means a nationwide CBA or one or more regional CBAs for purposes of implementing competitive bidding programs for items that are furnished through the mail by nationwide or regional mail order contract suppliers. [72 FR 18085, Apr. 10, 2007, as amended at 74 FR 2880, Jan. 16, 2009; 75 FR 73623, Nov. 29, 2010; 76 FR 70315, Nov. 10, 2011] § 414.411 Special rule in case of competitions for diabetic testing strips conducted on or after January 1, 2011. (a) National mail order competitions. (b) Other competitions. [75 FR 73623, Nov. 29, 2010] § 414.412 Submission of bids under a competitive bidding program. Link to an amendment published at 91 FR 49031, Aug. 3, 2026. (a) Requirement to submit a bid. (b) Grouping of items into product categories. (2) The bid amount for each lead item in a product category included under the DMEPOS CBP for the first time must not exceed the unadjusted fee schedule amount for the lead item. (3) The bid amount for each lead item in a product category included in a prior competition, if it has been 1 year or less since a SPA was paid for the item in the prior competition, must not exceed, for the same CBA, the lesser of— (i) The most recent SPA for the item plus 10 percent; or (ii) The unadjusted fee schedule amount for the item. (4) The bid amount for each lead item in a product category included in a prior competition, if it has been more than 1 year since a SPA was paid for the item in the prior competition, must not exceed the lesser of the— (i) Most recent SPA made for the item, as adjusted by the percentage change in the Consumer Price Index for all Urban Consumers (CPI-U) from the mid-point of the most recent 12-month period the SPA was in effect to the date that is 6 months prior to the date CMS announces the dates suppliers may register and submit bids under the current round of competition, plus 10 percent; or (ii) The unadjusted fee schedule amount for the item. (5) The bid amount for each lead item in a product category included in a prior competition but made under a bid for a new CBA, must not exceed the lesser of the— (i) Adjusted fee schedule amount for the item plus 10 percent; or (ii) Unadjusted fee schedule amount for the item. (6) The bids submitted for standard power wheelchairs paid in accordance with the special payment rules at § 414.409(a) cannot exceed the average monthly payment for the bundle of items and services that would otherwise apply to the item under subpart D of this part. (7) The bids submitted for continuous positive airway pressure (CPAP) devices paid in accordance with the special payment rules at § 414.409(a) cannot exceed the 1993 fee schedule amounts for these items, increased by the covered item update factors provided for these items in section 1834(a)(14) of the Act. (8) Suppliers shall take into consideration the special payment rules at § 414.409(d) when submitting bids for furnishing power wheelchairs under competitions where these rules apply. (9) The bid amount submitted for rental of class II continuous glucose monitors included as a lead item in a product category in a remote item delivery competitive bidding program for the first time must not exceed the payment amount that would otherwise apply to the monthly fee schedule amount for the supplies for the class II continuous glucose monitor under subpart D of this part plus the average of the purchase fee schedule amounts that would otherwise apply to the class II continuous glucose monitor for the areas included in the remote item delivery competitive bidding program divided by 60. (10) The bids amount submitted for rental of insulin infusion pumps included as a lead item in a product category in a remote item delivery competitive bidding program for the first time must not exceed the nonrural payment amount that would otherwise apply to the supplies and accessories for the insulin infusion pump under subpart D of this part, with the application of § 414.210(g), for a 1-month period plus the total nonrural rental fee schedule amounts that would otherwise apply to rental of the insulin pump for 13 months of continuous use under subpart D of this part, with the application of § 414.210(g), divided by 60. (11) The bid amounts submitted for an OTS back brace or OTS knee brace included as a lead item in a product category in a remote item delivery competitive bidding program for the first time cannot exceed the average nonrural payment amount that would otherwise apply to the item under subpart D of this part, with the application of § 414.210(g), for the areas included in the remote item delivery competitive bidding program. (12) Notwithstanding paragraphs (b)(9) through (11) of this section, the bid amount for each lead item in a product category in a remote item delivery competitive bidding program for the first time must not exceed the average payment amount that would otherwise apply to the item under subpart C, D, or Q of this part for the areas included in the remote item delivery competitive bidding program. (c) Furnishing of items. (d) Commonly-owned or controlled suppliers. (i) An ownership interest is the possession of equity in the capital, stock or profits of another supplier; (ii) A controlling interest exists if one or more of owners of a supplier is an officer, director or partner in another supplier; and (iii) Two or more suppliers are commonly-owned if one or more of them has an ownership interest totaling at least 5 percent in the other(s). (2) A supplier must disclose in its bid each supplier in which it has an ownership or controlling interest and each supplier which has an ownership or controlling interest in it. (3) Commonly-owned or controlled suppliers must submit a single bid to furnish a product category in a CBA. Each commonly-owned or controlled supplier that is located in the CBA for which the bid is being submitted must be included in the bid. The bid must also include any commonly-owned or controlled supplier that is located outside of the CBA but would furnish the product category to the beneficiaries who maintain a permanent residence in the CBA. (e) Mail order suppliers. (2) Suppliers that submit one or more bids under (e)(1) of this section may submit the same bid amount for each item under each competitive bidding program for which it submits a bid. (f) Applicability of the mail order competitive bidding program. (1) A CBA, if the supplier is awarded a contract under this subpart; or (2) An area not designated as a CBA. (g) Requiring bid surety bonds for bidding entities Bidding requirements. (2) Bid surety bond requirements. (A) The name of the bidding entity as the principal/obligor; (B) The name and National Association of Insurance Commissioners number of the authorized surety; (C) CMS as the named obligee; (D) The conditions of the bond as specified in paragraph (g)(3) of this section; (E) The CBA covered by the bond; (F) The bond number; (G) The date of issuance; and (H) The bid bond value of $50,000.00. (ii) The bid surety bond must be maintained until it is either collected upon due to forfeiture or the liability is returned for not meeting bid forfeiture conditions. (3) Forfeiture of bid surety bond. (ii) Where the bid(s) does not meet the specified forfeiture conditions in paragraph (g)(3)(i) of this section, the bid surety bond liability will be returned within 90 days of the public announcement of contract suppliers for the CBA. CMS will notify the bidding entity that it did not meet the specified forfeiture requirements and the bid surety bond will not be collected by CMS. (4) Penalties (ii) A bidding entity, whose composite bid is at or below the median composite bid rate, that— (A) Accepts a contract award; and (B) Is found to be in breach of contract for nonperformance of the contract to avoid forfeiture of the bid surety bond will have its contract terminated and will be precluded from participation in the in the next round of the DMEPOS Competitive Bidding Program. (5) Bid surety bond riders. (ii) Bidding entities can submit a bid surety bond rider to correct the identified deficiency(ies) applicable to any of the bid surety bond requirements outlined in paragraphs (g)(2)(i) and (ii) of this section. No other deficiency(ies) can be rectified by a bid surety bond rider. (iii) Bidding entities notified of a bid surety bond deficiency have 10-business days after the date of the notice to submit a bid surety bond rider. The bidder must receive the bid surety bond rider from the authorized surety that issued the original bid surety bond. [72 FR 18085, Apr. 10, 2007, as amended at 79 FR 66264, Nov. 6, 2014; 81 FR 77966, Nov. 4, 2016; 83 FR 21925, May 11, 2018; 83 FR 57072, Nov. 14, 2018; 88 FR 77876, Nov. 13, 2023; 90 FR 55605, Dec. 2, 2025] § 414.414 Conditions for awarding contracts. (a) General rule. (b) Basic supplier eligibility. (2) Each supplier must disclose information about any prior or current legal actions, sanctions, revocations from the Medicare program, program-related convictions as defined in section 1128(a)(1) through (a)(4) of the Act, exclusions or debarments imposed against it, or against any members of the board of directors, chief corporate officers, high-level employees, affiliated companies, or subcontractors, by any Federal, State, or local agency. The supplier must certify in its bid that this information is completed and accurate. (3) Each supplier must have all State and local licenses required to perform the services identified in the request for bids. CMS may not award a contract to any entity in a CBA unless the entity meets applicable State licensure requirements. (4) Each supplier must submit a bona fide bid that complies with all the terms and conditions contained in the request for bids. (5) Each network must meet the requirements specified in § 414.418. (c) Quality standards and accreditation. (d) Financial standards Financial document requirements. (ii) By the close of the bid window, a bidding entity that is unable to generate a business credit report with a numerical credit score or rating is required to submit both a business credit report showing no data or insufficient information to generate a credit score and a personal credit report with a numerical credit score or rating from the bidding entity's Authorized Official or Delegated Official listed in CMS' PECOS. (iii) The bidding entity must submit the documentation described in paragraphs (d)(1)(i) and (ii) of this section containing the approved crediting agency, an approved numerical credit score or rating, the name of the bidding entity or authorized official or delegated official, as applicable, and the date that the credit report was prepared, which must be generated within the 90 calendar days prior to the opening of the bid window in a form and manner specified by CMS. If the numerical credit score or rating is generated separately from the credit report, the bidding entity's name and the date it was prepared must be shown on the credit report and included with the numerical credit score or rating. (iv) The bidding entity must attest in the bidding system that it is submitting one bid that includes all commonly owned or commonly controlled locations, and that it will furnish the lead item and all non-lead items in the same competition. (2) Financial scoring methodology. (i) The approved credit agencies from which a bidding entity must obtain business and personal credit reports as applicable with a numerical credit score or rating. Bidding entities that must obtain both a business and personal credit report with a numerical credit score or rating do not have to utilize the same approved credit agency for both. (ii) The approved business and personal credit reports as applicable and associated numerical credit scores or ratings that must be submitted. (iii) The scoring system that will be utilized to determine if a bidding entity meets the financial sustainability threshold. (e) Evaluation of bids. (1) Calculating the number of suppliers selected to furnish the items and services in the competition in accordance with paragraph (h) of this section. (2) Arraying the composite bids from the lowest composite bid price to the highest composite bid price. (3) Selecting the number of suppliers and networks calculated under paragraph (e)(1) of this section that meet the requirements in paragraphs (b) through (d) of this section with the lowest composite bids. (f) Expected savings. (1) 110 percent of the adjusted fee schedule amount for the item, if applicable; or (2) The unadjusted fee schedule amount for the item. (g) Special rules for small suppliers Target for small supplier participation. (i) Setting a target number for small supplier participation by multiplying 30 percent by the number of suppliers that meet the requirements in paragraphs (b) through (d) of this section and whose composite bids are equal to or lower than the pivotal bid calculated for the product category; (ii) Identifying the number of qualified small suppliers whose composite bids are at or below the pivotal bid for the product category; (iii) Selecting additional small suppliers whose composite bids are above the pivotal bid for the product category in ascending order based on the proximity of each small supplier's composite bid to the pivotal bid, until the number calculated in paragraph (g)(1)(i) of this section is reached or there are no more composite bids submitted by small suppliers for the product category. (2) The bids by small suppliers that are selected under paragraph (g)(1)(iii) of this section are not used to calculate the single payment amounts for any items under § 414.416 of this subpart. (h) Sufficient number of contract suppliers. (i) CMS adjusts the number of contract suppliers selected in accordance with paragraph (h)(1) of this section for a competition to ensure the number selected is— (A) Not less than 50 percent of the total number of contract suppliers that furnished the lead item in 2018 or 2023 rounded up to the nearest whole number; (B) Not more than 75 percent of the total number of contract suppliers that furnished the lead in 2018 or 2023 rounded down to the nearest whole number; and (C) At least 2. (ii) [Reserved] (2) For competitions included in the DMEPOS CBP in 2018 or 2023, the first time a competition is recompeted after 2023 in accordance with paragraph (h)(1) of this section, the number of contract suppliers selected to furnish items and services in the competition is equal to the number of contract suppliers CMS selected the first time the competition was recompeted after 2023 in accordance with paragraph (h)(1) of this section, trended up or down based on the percentage change in Part B enrollment in the CBA since the first year (12-month period) of the most recent DMEPOS CBP supplier contract period, and rounded to the nearest whole number. (3) For competitions not included in the DMEPOS CBP in 2018 or 2023— (i) The first time a competition is conducted after 2023, the number of contract suppliers selected to furnish items and services is 125 percent of the number of suppliers that furnished at least 3 percent of total utilization for the lead item in the product category and CBA during the most recent calendar year, and rounded to the nearest whole number, unless there would be less than 2 contract suppliers, in which case the number of contract suppliers will be 2. (ii) For all subsequent recompetes for the competition, the number of suppliers selected to furnish items and services is equal to the number of contract suppliers selected in the prior competition or recompete, as applicable, trended up or down based on the percentage change in Part B enrollment in the CBA since the first year (12-month period) of the most recent DMEPOS CBP supplier contract period, and rounded to the nearest whole number. (i) Selection of new suppliers after bidding. (i) Referring to the arrayed list of suppliers that submitted bids for the product category included in the competitive bidding program for which beneficiary demand is not being met; and (ii) Beginning with the supplier whose composite bid is the first composite bid above the pivotal bid for that product category, determining if that supplier is willing to become a contract supplier under the same terms and conditions that apply to other contract suppliers in the CBA. (2) Before CMS awards additional contracts under paragraph (i)(1) of this section, a supplier must submit updated information demonstrating that the supplier meets the requirements under paragraphs (b) through (d) of this section. [72 FR 18085, Apr. 10, 2007, as amended at 74 FR 2880, Jan. 16, 2009; 76 FR 70315, Nov. 10, 2011; 79 FR 66264, Nov. 6, 2014; 81 FR 77967, Nov. 4, 2016; 83 FR 21925, May 11, 2018; 83 FR 57072, Nov. 14, 2018; 90 FR 55605, Dec. 2, 2025] § 414.416 Determination of competitive bidding payment amounts. (a) General rule. (b) Methodology for setting payment amount. (2) The single payment amount for an item in a product category furnished under a competitive bidding program that is not a lead item for that product category (non-lead item) is equal to the single payment amount for the lead item in the same product category multiplied by the ratio of the 2015 fee schedule amount for the non-lead item for the applicable area to which the fee schedule amount applies (State, District of Columbia, Puerto Rico, or United States Virgin Islands) to the 2015 fee schedule amount for the lead item for the same area. (3) The single payment amount for an item included in a product category in a remote item delivery competitive bidding program furnished under a competitive bidding program that is not a lead item for that product category (non-lead item) is equal to the single payment amount for the lead item in the same product category multiplied by the ratio of the average 2015 fee schedule amount for the non-lead item for the applicable area to which the fee schedule amount applies (State, District of Columbia, Puerto Rico, or United States Virgin Islands, a combination thereof, or nationwide) to the average 2015 fee schedule amount for the lead item for the same area. (i)(A) The 2015 fee schedule amounts for a continuous glucose monitor and supplies are calculated using the 2025 fee schedule amounts and removing the covered items update factors for years 2016 through 2025 specified under section 1834(a)(14) of the Act. (B) The 2015 fee schedule amounts for the bundled monthly rental of a continuous glucose monitor are calculated by adding the 2015 fee schedule amount for the supplies to the average of the 2015 fee schedule amounts for the purchase of a new continuous glucose monitor divided by 60 for the areas included in the remote item delivery CBP. (ii) The 2015 fee schedule amount for the monthly supplies for a continuous glucose monitor owned by a beneficiary is calculated using the 2025 fee schedule amount and removing the covered item update factors for years 2016 through 2025 specified under section 1834(a)(14) of the Act. (iii) The 2015 fee schedule amounts for the bundled monthly rental of an insulin infusion pump and supplies and accessories are calculated using the average 2015 fee schedule amounts for the insulin infusion pump multiplied by 10.5 and divided by 60 for the nonrural areas included in the remote item delivery CBP, and then adding the average 2015 fee schedule amounts for the sterile syringe type cartridge for the insulin infusion pump multiplied by 9 for the nonrural areas included in the remote item delivery CBP plus the average 2015 fee schedule amounts for the weekly insulin pump supplies multiplied by 4 for the areas included in the remote item delivery CBP. (iv) The 2015 fee schedule amounts for the monthly supplies and accessories for an insulin infusion pump owned by a beneficiary is calculated using the average 2015 fee schedule amounts for the sterile syringe type cartridge for the insulin infusion pump multiplied by 9 for the areas included in the remote item delivery CBP plus the average 2015 fee schedule amounts for the weekly insulin pump supplies multiplied by 4 for the areas included in the remote item delivery CBP. [72 FR 18085, Apr. 10, 2007, as amended at 81 FR 77967, Nov. 4, 2016; 83 FR 57072, Nov. 14, 2018; 90 FR 55606, Dec. 2, 2025] § 414.418 Opportunity for networks. (a) A network may be comprised of at least 2 but not more than 20 small suppliers. (b) The following rules apply to networks that seek contracts under this subpart: (1) Each network must form a single legal entity that acts as the bidder and submits the bid. Any agreement entered into for purposes of forming a network must be submitted to CMS. The network must identify itself as a network and identify all of its members. (2) Each member of the network must satisfy the requirements in § 414.414(b) through (d). (3) A small supplier may join one or more networks but cannot submit an individual bid to furnish the same product category in the same CBA as any network in which it is a member. A small supplier may not be a member of more than one network if those networks submit bids to furnish the same product category in the same CBA. (4) The network cannot be anticompetitive, and this section does not supersede any Federal law or regulation that regulates anticompetitive behavior. (5) A bid submitted by a network must include a statement from each network member certifying that the network member joined the network because it is unable independently to furnish all of the items in the product category for which the network is submitting a bid to beneficiaries throughout the entire geographic area of the CBA. (6) At the time that a network submits a bid, the network's total market share for each product category that is the subject of the network's bid cannot exceed 20 percent of the Medicare demand for that product category in the CBA. (c) If the network is awarded a contract, each supplier must submit its own claims and will receive payment directly from Medicare for the items that it furnishes under the competitive bidding program. [72 FR 18085, Apr. 10, 2007] § 414.420 Physician or treating practitioner authorization and consideration of clinical efficiency and value of items. (a) Prescription for a particular brand item or mode of delivery. (2) When a physician or treating practitioner prescribes a particular brand or mode of delivery of an item under paragraph (a)(1) of this section, the physician or treating practitioner must document the reason in the beneficiary's medical record why the particular brand or mode of delivery is medically necessary to avoid an adverse medical outcome. (b) Furnishing of a prescribed particular brand item or mode of delivery. (1) Furnish the particular brand or mode of delivery as prescribed by the physician or treating practitioner; (2) Consult with the physician or treating practitioner to find an appropriate alternative brand of item or mode of delivery for the beneficiary and obtain a revised written prescription from the physician or treating practitioner; or (3) Assist the beneficiary in locating a contract supplier that can furnish the particular brand of item or mode of delivery prescribed by the physician or treating practitioner. (c) Payment for a particular brand of item or mode of delivery. (d) Prohibition on billing for an item different from the particular brand of item or mode of delivery prescribed. [72 FR 18085, Apr. 10, 2007] § 414.422 Terms of contracts. (a) Basic rule. (b) Recompeting competitive bidding contracts. (c) Nondiscrimination. (d) Change of ownership (CHOW). (i) Meets all requirements applicable to contract suppliers for the applicable competitive bidding program; (ii) Submits to CMS the documentation described under § 414.414(b) through (d) if documentation has not previously been submitted by the successor entity or if the documentation is no longer sufficient for CMS to make a financial determination. A successor entity is not required to duplicate previously submitted information if the previously submitted information is not needed to make a financial determination. This documentation must be submitted prior to the effective date of the CHOW; and (iii) Submits to CMS a signed novation agreement acceptable to CMS stating that it assumes all obligations under the contract. This documentation must be submitted no later than 10 days after the effective date of the CHOW. (2) Except as specified in paragraph (d)(3) of this section, CMS may transfer the entire contract, including all product categories and competitive bidding areas, to a successor entity. (3) For contracts issued in the Round 2 Recompete and subsequent rounds in the case of a CHOW where a contract supplier sells a distinct company (for example, a subsidiary) that furnishes a specific product category or services a specific CBA, CMS may transfer the portion of the contract performed by that company to a successor entity, if the following conditions are met: (i) Every CBA, product category, and location of the company being sold must be transferred to the successor entity that meets all competitive bidding requirements; that is, financial, accreditation, and licensure; (ii) All CBAs and product categories in the original contract that are not explicitly transferred by CMS remain unchanged in that original contract for the duration of the contract period unless transferred by CMS pursuant to a subsequent CHOW; (iii) All requirements of paragraph (d)(1) of this section are met; (iv) The sale of the distinct company includes all of the contract supplier's assets associated with the CBA and/or product category(s); and (v) CMS determines that transfer of part of the original contract will not result in disruption of service or harm to beneficiaries. (e) Furnishing of items. (1) A contract supplier must agree to furnish items under its contract to any beneficiary who maintains a permanent residence in, or who visits, the CBA and who requests those items from that contract supplier. (2) A skilled nursing facility defined under section 1819(a) of the Act or a nursing facility defined under section 1919(a) of the Act that has elected to furnish items only to its own residents and that is also a contract supplier may furnish items under a competitive bidding program to its own patients to whom it would otherwise furnish Part B services. (3) Contract suppliers for diabetic testing supplies must furnish the brand of diabetic testing supplies that work with the home blood glucose monitor selected by the beneficiary. The contract supplier is prohibited from influencing or incentivizing the beneficiary by persuading, pressuring, or advising them to switch from their current brand or for new beneficiaries from their preferred brand of glucose monitor and testing supplies. The contract supplier may not furnish information about alternative brands to the beneficiary unless the beneficiary requests such information. (f) Disclosure of subcontracting arrangements. Initial disclosure. (i) Each subcontracting arrangement that the supplier has in furnishing items and services under the contract. (ii) Whether each subcontractor meets the requirement of section 1834(a)(20)(F)(i) of the Act if applicable to such subcontractor. (2) Subsequent disclosure. (i) The subcontracting arrangement that the supplier has in furnishing items and services under the contract. (ii) Whether the subcontractor meets the requirement of section 1834(a)(20)(F)(i) of the Act, if applicable to such subcontractor. (g) Breach of contract. (2) In the event a contract supplier breaches its contract, CMS may take one or more of the following actions, which will be specified in the notice of breach of contract: (i) Suspend the contract supplier's contract; (ii) Terminate the contract; (iii) Preclude the contract supplier from participating in the competitive bidding program; or (iv) Avail itself of other remedies allowed by law. (h) Contract termination during a public health emergency (PHE) under section 319 of the Public Health Service Act. (i) If the items and services in the PHE-impacted area identified in accordance with paragraph (h)(2) of this section encompass all competitions referenced in a DMEPOS CBP supplier contract, CMS will unilaterally terminate the DMEPOS CBP supplier contract. (ii) If the items and services in the PHE-impacted area identified in accordance with paragraph (h)(2) of this section encompass only a portion of the competitions referenced in a DMEPOS CBP supplier contract, CMS will unilaterally modify the DMEPOS CBP supplier contract to remove the contract supplier's obligation to furnish specified items and services in the PHE- impacted area, as well as CMS's obligation to pay for those items and services under the DMEPOS CBP supplier contract. (iii) After termination or modification of all applicable DMEPOS CBP supplier contracts, CMS reverts back to the general fee-for-service program requirements set forth in subpart D of this part for the applicable competition(s) or defined area(s) within a CBA. (2) CMS may remove items and services furnished in a PHE-impacted area from the DMEPOS CBP when all of the following qualifying criteria are met: (i) The Secretary declares a PHE under section 319 of the Public Health Services Act. (ii) CMS determines that verifiable evidence exists of a DMEPOS access problem for beneficiaries for a certain competition or defined area(s) within the competition's CBA. (iii) CMS determines that awarding additional DMEPOS CBP supplier contracts, per § 414.414(i), would not address the access concerns. (iv) CMS determines terminating or modifying each impacted DMEPOS CBP supplier contract to exclude certain competition(s) or defined area(s) within the competition's CBA from the DMEPOS CBP would alleviate access concerns. [72 FR 18085, Apr. 10, 2007, as amended at 74 FR 2881, Jan. 16, 2009; 75 FR 73623, Nov. 29, 2010; 76 FR 70315, Nov. 10, 2011; 79 FR 66264, Nov. 6, 2014; 81 FR 77967, Nov. 4, 2016; 83 FR 57073, Nov. 14, 2018; 84 FR 60808, Nov. 8, 2019; 90 FR 55607, Dec. 2, 2025] § 414.423 Appeals process for breach of a DMEPOS competitive bidding program contract actions. This section implements an appeals process for suppliers that CMS has determined are in breach of their Medicare DMEPOS Competitive Bidding Program contract and where CMS has issued a notice of breach of contract indicating its intent to take action(s) pursuant to § 414.422(g)(2). (a) Breach of contract. (b) Notice of breach of contract CMS notification. (2) Content of the notice of breach of contract. (i) The details of the breach of contract. (ii) The action(s) that CMS is taking as a result of the breach of the contract pursuant to § 414.422(g)(2), and the duration of or timeframe(s) associated with the action(s), if applicable. (iii) The right to request a hearing by a CBIC hearing officer and, depending on the nature of the breach, the supplier may also be allowed to submit a corrective action plan (CAP) in lieu of requesting a hearing by a CBIC hearing officer, as specified in paragraph (c)(1)(i) of this section. (iv) The address to which the written request for a hearing must be submitted. (v) The address to which the CAP must be submitted, if applicable. (vi) The effective date of the action(s) that CMS is taking is the date specified by CMS in the notice of breach of contract, or 45 days from the date of the notice of breach of contract unless: (A) A timely hearing request has been filed; or (B) A CAP has been submitted within 30 days of the date of the notice of breach of contract where CMS allows a supplier to submit a CAP. (c) Corrective action plan (CAP) Option for a CAP. (ii) If a supplier chooses not to submit a CAP, if CMS determines that a supplier's CAP is insufficient, or if CMS does not allow the supplier the option to submit a CAP, the supplier may request a hearing on the breach of contract action(s). (2) Submission of a CAP. (ii) Suppliers will have the opportunity to submit a CAP when they are first notified that they have been determined to be in breach of contract. If the CAP is not acceptable to CMS or is not properly implemented, suppliers will receive a subsequent notice of breach of contract. The subsequent notice of breach of contract may, at CMS' discretion, allow the supplier to submit another written CAP pursuant to paragraph (c)(1)(i) of this section. (d) The purpose of the CAP. (1) For the supplier to remedy all of the deficiencies that were identified in the notice of breach of contract. (2) To identify the timeframes by which the supplier will implement each of the components of the CAP. (e) Review of the CAP. (2) If CMS accepts the CAP, including the supplier's designated timeframe for its completion, the supplier must provide a follow-up report within 5 days after the supplier has fully implemented the CAP that verifies that all of the deficiencies identified in the CAP have been corrected in accordance with the timeframes accepted by CMS. (3) If the supplier does not implement a CAP that was accepted by CMS, or if CMS does not accept the CAP submitted by the supplier, then the supplier will receive a subsequent notice of breach of contract, as specified in paragraph (b) of this section. (f) Right to request a hearing by the CBIC Hearing Officer (2) A supplier that wishes to appeal the breach of contract action(s) specified in the notice of breach of contract must submit a written request to the CBIC. The request for a hearing must be submitted to the CBIC within 30 days from the date of the notice of breach of contract. (3) A request for hearing must be in writing and submitted by an authorized official of the supplier. (4) The appeals process for the Medicare DMEPOS Competitive Bidding Program is not to be used in place of other existing appeals processes that apply to other parts of Medicare. (5) If the supplier is given the opportunity to submit a CAP and a CAP is not submitted and the supplier fails to timely request a hearing, the breach of contract action(s) will take effect 45 days from the date of the notice of breach of contract. (g) The CBIC Hearing Officer schedules and conducts the hearing (2) The hearing may be held in person or by telephone at the parties' request. (3) The scheduling notice to the parties must indicate the time and place for the hearing and must be sent to the parties at least 30 days before the date of the hearing. (4) The hearing officer may, on his or her own motion, or at the request of a party, change the time and place for the hearing, but must give the parties to the hearing 30 days' notice of the change. (5) The hearing officer's scheduling notice must provide the parties to the hearing the following information: (i) A description of the hearing procedure. (ii) The specific issues to be resolved. (iii) The supplier has the burden to prove it is not in violation of the contract or that the breach of contract action(s) is not appropriate. (iv) The opportunity for parties to the hearing to submit additional evidence to support their positions, if requested by the hearing officer. (v) A notification that all evidence submitted, both from the supplier and CMS, will be provided in preparation for the hearing to all affected parties at least 15 days prior to the scheduled date of the hearing. (h) Burden of proof and evidence submission (2) The supplier's evidence must be submitted with its request for a hearing. (3) If the supplier fails to submit the evidence at the time of its submission, the Medicare DMEPOS supplier is precluded from introducing new evidence later during the hearing process, unless permitted by the hearing officer. (4) CMS also has the opportunity to submit evidence to the hearing officer within 10 days of receiving the scheduling notice. (5) The hearing officer will share all evidence submitted by the supplier and/or CMS, with all parties to the hearing at least 15 days prior to the scheduled date of the hearing. (i) Role of the hearing officer. (1) Conduct the hearing and decide the order in which the evidence and the arguments of the parties are presented; (2) Determine the rules on admissibility of the evidence; (3) Examine the witnesses, in addition to the examinations conducted by CMS and the contract supplier; (4) The CBIC may assist CMS in the appeals process including being present at the hearing, testifying as a witness, or performing other, related ministerial duties; (5) Determine the rules for requesting documents and other evidence from other parties; (6) Ensure a complete record of the hearing is made available to all parties to the hearing; (7) Prepare a file of the record of the hearing which includes all evidence submitted as well as any relevant documents identified by the hearing officer and considered as part of the hearing; and (8) Comply with all applicable provisions of Title 18 and related provisions of the Act, the applicable regulations issued by the Secretary, and manual instructions issued by CMS. (j) Hearing officer recommendation. (2) The recommendation(s) will explain the basis and the rationale for the hearing officer's recommendation(s). (3) The hearing officer must include the record of the hearing, along with all evidence and documents produced during the hearing along with its recommendation(s). (k) CMS' final determination. (2) After reviewing the hearing officer's recommendation(s), CMS' decision(s) will be made within 30 days from the date of receipt of the hearing officer's recommendation(s). In situations where there is more than one breach of contract action presented at the hearing, and the hearing officer issues multiple recommendations, CMS will render separate decisions for each breach of contract action. (3) A notice of CMS' decision will be sent to the supplier and the hearing officer. The notice will indicate: (i) If any breach of contract action(s) included in the notice of breach of contract, specified in paragraph (b)(1) of this section, still apply and will be effectuated, and (ii) The effective date for any breach of contract action specified in paragraph (k)(3)(i) of this section. (4) This decision(s) is final and binding. (l) Effect of breach of contract action(s) Effect of contract suspension. (ii) The supplier must notify all beneficiaries who are receiving rented competitive bid items or competitive bid items on a recurring basis of the suspension of their contract. (A) The notice to the beneficiary from the supplier must be provided within 15 days of receipt of the final notice. (B) The notice to the beneficiary must inform the beneficiary that they must select a new contract supplier to furnish these items in order for Medicare to pay for these items. (2) Effect of contract termination. (ii) The supplier must notify all beneficiaries, who are receiving rented competitive bid items or competitive bid items received on a recurring basis, of the termination of their contract. (A) The notice to the beneficiary from the supplier must be provided within 15 days of receipt of the final notice of termination. (B) The notice to the beneficiary must inform the beneficiary that they are going to have to select a new contract supplier to furnish these items in order for Medicare to pay for these items. (3) Effect of preclusion. (4) Effect of other remedies allowed by law. [81 FR 77967, Nov. 4, 2016, as amended at 83 FR 57073, Nov. 14, 2018; 84 FR 60809, Nov. 8, 2019] § 414.424 Administrative or judicial review. (a) There is no administrative or judicial review under this subpart of the following: (1) Establishment of payment amounts. (2) Awarding of contracts. (3) Designation of CBAs. (4) Phase-in of the competitive bidding programs. (5) Selection of items for competitive bidding. (6) Bidding structure and number of contract suppliers selected for a competitive bidding program. (b) A denied claim is not appealable if the denial is based on a determination by CMS that a competitively bid item was furnished in a CBA in a manner not authorized by this subpart. [72 FR 18085, Apr. 10, 2007] § 414.425 Claims for damages. (a) Eligibility for filing a claim for damages as a result of the termination of supplier contracts by the Medicare Improvements for Patients and Providers Act of 2008 (MIPPA). (2) A subcontractor of a contract supplier is not eligible to submit a claim under this section. (b) Timeframe for filing a claim. (2) The date of filing is the actual date of receipt by the CBIC of a completed claim that includes all the information required by this rule. (c) Information that must be included in a claim. (2) A copy of the signed contract entered into with CMS for the Round 1 DMEPOS Competitive Bidding Program; (3) A detailed explanation of the damages incurred by this supplier as a direct result of the termination of the Round 1 competitive bid contract by MIPPA. The explanation must include all of the following: (i) Documentation of the supplier's damages through receipts. (ii) Records that substantiate the supplier's damages and demonstrate that the damages are directly related to performance of the Round 1 contract and are consistent with information the supplier provided as part of their bid. (4) The supplier must explain how it would be damaged if not reimbursed. (5) The claim must document steps the supplier took to mitigate any damages they may have incurred due to the contract termination, including a detailed explanation of the steps of all attempts to use for other purposes, return or dispose of equipment or other assets purchased or rented for the use in the Round 1 DMEPOS CBP contract performance. (d) Items that will not be considered in a claim. (1) The cost of submitting a bid. (2) Any fees or costs incurred for consulting or marketing. (3) Costs associated with accreditation or licensure. (4) Costs incurred before March 20, 2008. (5) Costs incurred for contract performance after July 14, 2008 except for costs incurred to mitigate damages. (6) Any profits a supplier may have expected from the contract. (7) Costs that would have occurred without a contract having been awarded. (8) Costs for items such as inventory, delivery vehicles, office space and equipment, personnel, which the supplier did not purchase specifically to perform the contract. (9) Costs that the supplier has recouped by any means, and may include use of personnel, material, suppliers, or equipment in the supplier's business operations. (e) Filing a claim. (2) Claims must include a statement from a supplier's authorized official certifying the accuracy of the information provided on the claim and all supporting documentation. (3) The CBIC does not accept electronic submissions of claims for damages. (f) Review of claim. Role of the CBIC. (ii) For complete, timely claims, the CBIC will review the claim on its merits to determine if damages are warranted and may seek further information from the claimant when making its recommendation to the Determining Authority. The CBIC may set a deadline for receipt of additional information. A claimant's failure to respond timely may result in a denial of the claim. (iii) The CBIC will make a recommendation to the Determining Authority for each claim filed and include an explanation that supports its recommendation. (iv) The recommendation must be either to award damages for a particular amount (which may not be the same amount requested by the claimant) or that no damages should be awarded. (A) If the CBIC recommends that damages are warranted, the CBIC will calculate a recommended reasonable amount of damages based on the claim submitted. (B) The reasonable amount will consider both costs incurred and the contractor's attempts and action to limit the damages; (v) The recommendation will be sent to the Determining Authority for a final determination. (2) CMS' role as the Determining Authority. (ii) The Determining Authority may seek further information from the claimant or the CBIC in making a concurrence or non-concurrence determination. (iii) The Determining Authority may set a deadline for receipt of additional information. A claimant's failure to respond timely may result in a denial of the claim. (iv) If the Determining Authority concurs with the CBIC recommendation, the Determining Authority shall submit a final signed decision to the CBIC and direct the CBIC to notify the claimant of the decision and the reasons for the final decision. (v) If the Determining Authority non-concurs with the CBIC recommendation, the Determining Authority may return the claim for further processing or the Determining Authority may: (A) Write a determination granting (in whole or in part) a claim for damages or denying a claim in its entirety; (B) Direct the CBIC to write said determination for the Determining Authority's signature; or (C) Return the claim to the CBIC with further instructions. (vi) The Determining Authority's determination is final and not subject to administrative or judicial review. (g) Timeframe for determinations. (2) In the case of more complex cases, or in the event of a large workload, a decision will be issued as soon as practicable. (h) Notification to claimant of damage determination. [74 FR 62011, Nov. 25, 2009] § 414.426 Adjustments to competitively bid payment amounts to reflect changes in the HCPCS. If a HCPCS code for a competitively bid item is revised after the contract period for a competitive bidding program begins, CMS adjusts the single payment amount for that item as follows: (a) If a single HCPCS code for an item is divided into two or more HCPCS codes for the components of that item, the sum of single payment amounts for the new HCPCS codes equals the single payment amount for the original item. Contract suppliers must furnish the components of the item and submit claims using the new HCPCS codes. (b) If a single HCPCS code is divided into two or more separate HCPCS codes, the single payment amount for each of the new separate HCPCS codes is equal to the single payment amount applied to the single HCPCS code. Contract suppliers must furnish the items and submit claims using the new separate HCPCS codes. (c) If the HCPCS codes for components of an item are merged into a single HCPCS code for the item, the single payment amount for the new HCPCS code is equal to the total of the separate single payment amounts for the components. Contract suppliers must furnish the item and submit claims using the new HCPCS code. (d) If multiple HCPCS codes for similar items are merged into a single HCPCS code, the items to which the new HCPCS codes apply may be furnished by any supplier that has a valid Medicare billing number. Payment for these items will be made in accordance with Subpart C or Subpart D. [72 FR 18085, Apr. 10, 2007] Subpart G—Payment for Clinical Diagnostic Laboratory Tests Source: 71 FR 69786, Dec. 1, 2006, unless otherwise noted. § 414.500 Basis and scope. This subpart implements provisions of 1833(h)(8) of the Act and 1834A of the Act—procedures for determining the basis for, and amount of, payment for a clinical diagnostic laboratory test (CDLT). [81 FR 41098, June 23, 2016] § 414.502 Definitions. For purposes of this subpart— Actual list charge Advanced diagnostic laboratory test (ADLT) (1) The test— (i) Is an analysis of multiple biomarkers of deoxyribonucleic acid (DNA), ribonucleic acid (RNA), or proteins; (ii) When combined with an empirically derived algorithm, yields a result that predicts the probability a specific individual patient will develop a certain condition(s) or respond to a particular therapy(ies); (iii) Provides new clinical diagnostic information that cannot be obtained from any other test or combination of tests; and (iv) May include other assays. (2) The test is cleared or approved by the Food and Drug Administration. Applicable information, (1) Means— (i) Each private payor rate for which final payment has been made during the data collection period; (ii) The associated volume of tests performed corresponding to each private payor rate; and (iii) The specific Healthcare Common Procedure Coding System (HCPCS) code associated with the test. (2) Does not include information about a test for which payment is made on a capitated basis. Applicable laboratory (1) Is a laboratory, as defined in § 493.2 of this chapter; (2) Bills Medicare Part B under its own National Provider Identifier (NPI); (i) For hospital outreach laboratories—bills Medicare Part B on the CMS 1450 under bill type 14x; (ii) [Reserved] (3) In a data collection period, receives more than 50 percent of its Medicare revenues, which includes fee-for-service payments under Medicare Parts A and B, prescription drug payments under Medicare Part D, and any associated Medicare beneficiary deductible or coinsurance for services furnished during the data collection period from one or a combination of the following sources: (i) This subpart G. (ii) Subpart B of this part. (4) Receives at least $12,500 of its Medicare revenues from this subpart G. Except, for a single laboratory that offers and furnishes an ADLT, this $12,500 threshold— (i) Does not apply with respect to the ADLTs it offers and furnishes; and (ii) Applies with respect to all the other CDLTs it furnishes. Blood bank or center Data collection period Data reporting period National Provider Identifier New advanced diagnostic laboratory test New ADLT initial period New clinical diagnostic laboratory test New test Private payor (1) A health insurance issuer, as defined in section 2791(b)(2) of the Public Health Service Act. (2) A group health plan, as defined in section 2791(a)(1) of the Public Health Service Act. (3) A Medicare Advantage plan under Medicare Part C, as defined in section 1859(b)(1) of the Act. (4) A Medicaid managed care organization, as defined in section 1903(m)(1)(A) of the Act. Private payor rate, (1) Is the final amount that is paid by a private payor for a CDLT after all private payor price concessions are applied and does not include price concessions applied by a laboratory. (2) Includes any patient cost sharing amounts, if applicable. (3) Does not include information about denied payments. Publicly available rate Reporting entity Single laboratory, (1) The laboratory, as defined in 42 CFR 493.2, which furnishes the test, and that may also design, offer, or sell the test; and (2) The following entities, which may design, offer, or sell the test: (i) The entity that owns the laboratory. (ii) The entity that is owned by the laboratory. Specific HCPCS code Substantially Revised Healthcare Common Procedure Coding System Code Successor owner, (1) Partnership. (2) Unincorporated sole proprietorship. (3) Corporation. Taxpayer Identification Number [71 FR 69786, Dec. 1, 2006, as amended at 72 FR 66401, Nov. 27, 2007; 81 FR 41098, June 23, 2016; 83 FR 60074, Nov. 23, 2018; 84 FR 61490, Nov. 12, 2019; 85 FR 85028, Dec. 28, 2020; 87 FR 70225, Nov. 18, 2022; 88 FR 79531, Nov. 16, 2023; 89 FR 98559, Dec. 9, 2024] § 414.504 Data reporting requirements. (a) In a data reporting period, a reporting entity must report applicable information for each CDLT furnished by its component applicable laboratories during the corresponding data collection period, as follows— (1) For CDLTs that are not ADLTs, initially January 1, 2017 and every 3 years beginning January 1, 2026. (2) For ADLTs that are not new ADLTs, every year beginning January 1, 2017. (3) For new ADLTs— (i) Initially, no later than the last day of the second quarter of the new ADLT initial period; and (ii) Thereafter, every year. (b) Applicable information must be reported in the form and manner specified by CMS. (c) A laboratory seeking new ADLT status for its test must, in its new ADLT application, attest to the actual list charge. (d) To certify data integrity, the President, CEO, or CFO of a reporting entity, or an individual who has been delegated authority to sign for, and who reports directly to, such an officer, must sign the certification statement and be responsible for assuring that the data provided are accurate, complete, and truthful, and meets all the reporting parameters described in this section. (e) If the Secretary determines that a reporting entity has failed to report applicable information for its applicable laboratories, or made a misrepresentation or omission in reporting applicable information for its applicable laboratories, the Secretary may apply a civil monetary penalty to a reporting entity in an amount of up to $10,000 per day, as amended by the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 (Sec. 701 of the Bipartisan Budget Act of 2015, Pub. L. 114-74, November 2, 2015), for each failure to report or each such misrepresentation or omission. The provisions for civil monetary penalties that apply in general to the Medicare program under 42 U.S.C. 1320a-7b apply in the same manner to the laboratory data reporting process under this section. (f) CMS or its contractors will not disclose applicable information reported to CMS under this section in a manner that would identify a specific payor or laboratory, or prices charged or payments made to a laboratory, except to permit the Comptroller General, the Director of the Congressional Budget Office, and the Medicare Payment Advisory Commission, to review the information, or as CMS determines is necessary to implement this subpart, such as disclosures to the HHS Office of Inspector General or the Department of Justice for oversight and enforcement activities. (g) Applicable information may not be reported for an entity that does not meet the definition of an applicable laboratory. For a single laboratory that offers and furnishes an ADLT that is not an applicable laboratory except with respect to its ADLTs, the applicable information of its CDLTs that are not ADLTs may not be reported. [81 FR 41099, June 23, 2016, as amended at 85 FR 85028, Dec. 28, 2020; 87 FR 70225, Nov. 18, 2022; 88 FR 79531, Nov. 16, 2023; 89 FR 98559, Dec. 9, 2024] § 414.506 Procedures for public consultation for payment for a new clinical diagnostic laboratory test. For a new CDLT, CMS determines the basis for and amount of payment after performance of the following: (a) CMS makes available to the public (through CMS's Internet Web site) a list that includes codes for which establishment of a payment amount is being considered for the next calendar year. (b) CMS publishes a Federal Register (c) Not fewer than 30 days after publication of the notice in the Federal Register, (d) Considering the comments and recommendations (and accompanying data) received at the public meeting, CMS develops and makes available to the public (through an Internet Web site and other appropriate mechanisms) a list of— (1) Proposed determinations with respect to the appropriate basis for establishing a payment amount for each code, with an explanation of the reasons for each determination, the data on which the determinations are based, including recommendations from the Advisory Panel on CDLTs described in paragraph (e) of this section, and a request for written public comments within a specified time period on the proposed determination; and (2) Final determinations of the payment amounts for tests, with the rationale for each determination, the data on which the determinations are based, and responses to comments and suggestions from the public. (3) On or after January 1, 2018, in applying paragraphs (d)(1) and (2) of this section, CMS will provide an explanation of how it took into account the recommendations of the Advisory Panel on CDLTs described in paragraph (e) of this section. (4) On or after January 1, 2018, in applying paragraphs (d)(1) and (2) of this section and § 414.509(b)(2)(i) and (iii) when CMS uses the gapfilling method described in § 414.508(b)(2), CMS will make available to the public an explanation of the payment rate for the test. (e) CMS will consult with an expert outside advisory panel, called the Advisory Panel on CDLTs, composed of an appropriate selection of individuals with expertise, which may include molecular pathologists researchers, and individuals with expertise in laboratory science or health economics, in issues related to CDLTs. This advisory panel will provide input on the establishment of payment rates under § 414.508 and provide recommendations to CMS under this subpart. [71 FR 69786, Dec. 1, 2006, as amended at 72 FR 66401, Nov. 27, 2007; 81 FR 41099, June 23, 2016] § 414.507 Payment for clinical diagnostic laboratory tests. (a) General rule. (b) Methodology. (c) The payment amounts established under this section are not subject to any adjustment, such as geographic, budget neutrality, annual update, or other adjustment. (d) Phase-in of payment reductions. (1) 2018—10 percent of the national limitation amount for the test in 2017. (2) 2019—10 percent of the payment rate established in 2018. (3) 2020—10 percent of the payment rate established in 2019. (4) 2021—0.0 percent of the payment rate established in 2020. (5) 2022—0.0 percent of the payment rate established in 2021. (6) 2023-0.0 percent of the payment rate established in 2022. (7) 2024—0.0 percent of the payment rate established in 2023. (8) 2025—0.0 percent of the payment rate established in 2024. (9) 2026—15 percent of the payment rate established in 2025. (10) 2027—15 percent of the payment rate established in 2026. (11) 2028—15 percent of the payment rate established in 2027. (e) There is no administrative or judicial review under sections 1869 and 1878 of the Social Security Act, or otherwise, of the payment rates established under this subpart. (f) For a CDLT for which CMS receives no applicable information, payment is made based on the crosswalking or gapfilling methods described in § 414.508(b)(1) and (2). (g) For ADLTs that are furnished between April 1, 2014 and December 31, 2017, payment is based on the crosswalking or gapfilling methods described in § 414.508(a). [81 FR 41099, June 23, 2016, as amended at 85 FR 85028, Dec. 28, 2020; 87 FR 70225, Nov. 18, 2022; 88 FR 79531, Nov. 16, 2023; 89 FR 98559, Dec. 9, 2024] § 414.508 Payment for a new clinical diagnostic laboratory test. (a) For a new CDLT that is assigned a new or substantially revised code between January 1, 2005 and December 31, 2017, CMS determines the payment amount based on either of the following: (1) Crosswalking. (i) CMS assigns to the new CDLT code, the local fee schedule amounts and national limitation amount of the existing test. (ii) Payment for the new CDLT code is made at the lesser of the local fee schedule amount or the national limitation amount. (2) Gapfilling. (i) In the first year, Medicare Administrative Contractor-specific amounts are established for the new CDLT code using the following sources of information to determine gapfill amounts, if available: (A) Charges for the CDLT and routine discounts to charges; (B) Resources required to perform the CDLT; (C) Payment amounts determined by other payors; and (D) Charges, payment amounts, and resources required for other tests that may be comparable or otherwise relevant. (ii) In the second year, the test code is paid at the national limitation amount, which is the median of the contractor-specific amounts. (iii) For a new CDLT for which a new or substantially revised HCPCS code was assigned on or before December 31, 2007, after the first year of gapfilling, CMS determines whether the contractor-specific amounts will pay for the test appropriately. If CMS determines that the contractor-specific amounts will not pay for the test appropriately, CMS may crosswalk the test. (b) For a new CDLT that is assigned a new or substantially revised HCPCS code on or after January 1, 2018, CMS determines the payment amount based on either of the following until applicable information is available to establish a payment amount under the methodology described in § 414.507(b): (1) Crosswalking. (i) CMS assigns to the new CDLT code, the payment amount established under § 414.507 of the comparable existing CDLT. (ii) Payment for the new CDLT code is made at the payment amount established under § 414.507. (2) Gapfilling. (i) In the first year, Medicare Administrative Contractor-specific amounts are established for the new CDLT code using the following sources of information to determine gapfill amounts, if available: (A) Charges for the test and routine discounts to charges; (B) Resources required to perform the test; (C) Payment amounts determined by other payors; (D) Charges, payment amounts, and resources required for other tests that may be comparable or otherwise relevant; and (E) Other criteria CMS determines appropriate. (ii) In the second year, the CDLT code is paid at the median of the Medicare Administrative Contractor-specific amounts. [81 FR 41100, June 23, 2016] § 414.509 Reconsideration of basis for and amount of payment for a new clinical diagnostic laboratory test. For a new CDLT, the following reconsideration procedures apply: (a) Reconsideration of basis for payment. (2)(i) A requestor that submitted a request under paragraph (a)(1) of this section may also present its reconsideration request at the public meeting convened under § 414.506(c), provided that the requestor requests an opportunity to present at the public meeting as part of its written submission under paragraph (a)(1) of this section. (ii) If the requestor presents its reconsideration request at the public meeting convened under § 414.506(c), members of the public may comment on the reconsideration request verbally at the public meeting and may submit written comments after the public meeting (within the timeframe for public comments established by CMS). (3) Considering reconsideration requests and other comments received, CMS may reconsider its determination of the basis for payment. As the result of such a reconsideration, CMS may change the basis for payment from crosswalking to gapfilling or from gapfilling to crosswalking. (4) If the basis for payment is revised as the result of a reconsideration, the new basis for payment is final and is not subject to further reconsideration. (b) Reconsideration of amount of payment Crosswalking. (ii)(A) A requestor that submitted a request under paragraph (b)(1)(i) of this section may also present its reconsideration request at the public meeting convened under § 414.506(c), provided that the requestor requests an opportunity to present at the public meeting as part of its written submission under paragraph (b)(1)(i) of this section. (B) If a requestor presents its reconsideration request at the public meeting convened under § 414.506(c), members of the public may comment on the reconsideration request verbally at the public meeting and may submit written comments after the public meeting (within the timeframe for public comments established by CMS). (iii) Considering comments received, CMS may reconsider its determination of the amount of payment. As the result of such a reconsideration, CMS may change the code or codes to which the new test is crosswalked. (iv) If CMS changes the basis for payment from gapfilling to crosswalking as a result of a reconsideration, the crosswalked amount of payment is not subject to reconsideration. (2) Gapfilling. (ii) For 60 days after CMS posts interim Medicare Administrative Contractor-specific amounts on the CMS Web site, CMS will receive public comments in written format regarding the interim Medicare Administrative Contractor-specific amounts. (iii) After considering the public comments, CMS will post final Medicare Administrative Contractor-specific amounts on the CMS Web site. (iv) For 30 days after CMS posts final Medicare Administrative Contractor-specific payment amounts on the CMS Web site, CMS will receive reconsideration requests in written format regarding whether CMS should reconsider the final Medicare Administrative Contractor-specific payment amount and median of the Medicare Administrative Contractor-specific payment amount for the CDLT. (v) Considering reconsideration requests received, CMS may reconsider its determination of the amount of payment. As the result of a reconsideration, CMS may revise the median of the Medicare Administrative Contractor-specific payment amount for the CDLT. (3) For both gapfilled and crosswalked new tests, if CMS revises the amount of payment as the result of a reconsideration, the new amount of payment is final and is not subject to further reconsideration. (c) Effective date. (d) Jurisdiction for reconsideration decisions. [72 FR 66401, Nov. 27, 2007, as amended at 73 FR 2432, Jan. 15, 2008; 81 FR 41100, June 23, 2016] § 414.510 Laboratory date of service for clinical laboratory and pathology specimens. The date of service for either a clinical laboratory test or the technical component of physician pathology service is as follows: (a) Except as provided under paragraph (b) of this section, the date of service of the test must be the date the specimen was collected. (b)(1) If a specimen was collected over a period that spans 2 calendar days, then the date of service must be the date the collection ended. (2) In the case of a test performed on a stored specimen, if a specimen was stored for— (i) Less than or equal to 30 calendar days from the date it was collected, the date of service of the test must be the date the test was performed only if— (A) The test is ordered by the patient's physician at least 14 days following the date of the patient's discharge from the hospital; (B) The specimen was collected while the patient was undergoing a hospital surgical procedure; (C) It would be medically inappropriate to have collected the sample other than during the hospital procedure for which the patient was admitted; (D) The results of the test do not guide treatment provided during the hospital stay; and (E) The test was reasonable and medically necessary for the treatment of an illness. (ii) More than 30 calendar days before testing, the specimen is considered to have been archived and the date of service of the test must be the date the specimen was obtained from storage. (3) In the case of a chemotherapy sensitivity test performed on live tissue, the date of service of the test must be the date the test was performed only if— (i) The decision regarding the specific chemotherapeutic agents to test is made at least 14 days after discharge; (ii) The specimen was collected while the patient was undergoing a hospital surgical procedure; (iii) It would be medically inappropriate to have collected the sample other than during the hospital procedure for which the patient was admitted; (iv) The results of the test do not guide treatment provided during the hospital stay; and, (v) The test was reasonable and medically necessary for the treatment of an illness. (4) For purposes of this section, “chemotherapy sensitivity test” means a test identified by the Secretary as a test that requires a fresh tissue sample to test the sensitivity of tumor cells to various chemotherapeutic agents. The Secretary identifies such tests through program instructions. (5) In the case of a molecular pathology test performed by a laboratory other than a blood bank or center, a test designated by CMS as an ADLT under paragraph (1) of the definition of an advanced diagnostic laboratory test in § 414.502, a test that is a cancer-related protein-based Multianalyte Assays with Algorithmic Analyses, or the test described by CPT code 81490, the date of service of the test must be the date the test was performed only if— (i) The test was performed following a hospital outpatient's discharge from the hospital outpatient department; (ii) The specimen was collected from a hospital outpatient during an encounter (as both are defined in § 410.2 of this chapter); (iii) It was medically appropriate to have collected the sample from the hospital outpatient during the hospital outpatient encounter; (iv) The results of the test do not guide treatment provided during the hospital outpatient encounter; and (v) The test was reasonable and medically necessary for the treatment of an illness. [71 FR 69786, Dec. 1, 2006, as amended at 72 FR 66402, Nov. 27, 2007; 82 FR 52636, Nov. 13, 2017; 82 FR 59496, Dec. 14, 2017; 84 FR 61490, Nov. 12, 2019; 85 FR 86301, Dec. 29, 2020] § 414.522 Payment for new advanced diagnostic laboratory tests. (a) The payment rate for a new ADLT— (1) During the new ADLT initial period, is equal to its actual list charge. (2) Prior to the new ADLT initial period, is determined by the Medicare Administrative Contractor based on information provided by the laboratory seeking new ADLT status for its laboratory test. (b) After the new ADLT initial period, the payment rate for a new ADLT is equal to the weighted median established under the payment methodology described in § 414.507(b). (c) If, after the new ADLT initial period, the actual list charge of a new ADLT is greater than 130 percent of the weighted median established under the payment methodology described in § 414.507, CMS will recoup the difference between the ADLT actual list charge and 130 percent of the weighted median. (d) If CMS does not receive any applicable information for a new ADLT by the last day of the second quarter of the new ADLT initial period, the payment rate for the test is determined either by the gapfilling or crosswalking method as described in § 414.508(b)(1) and (2). [81 FR 41100, June 23, 2016] § 414.523 Payment for laboratory specimen collection fee and travel allowance. (a) Specimen collection fee and travel allowance. (1) Payment for specimen collection. (i) Used to perform a CDLT paid under this subpart G; (ii) Collected by a trained technician from a Medicare beneficiary who is—— (A) Homebound as described in 42 CFR 424.22(a)(1)(ii). (B) A non-hospital inpatient, but only when no qualified personnel are available at the facility to collect the specimen; (iii) Of the following type— (A) Blood specimen collected through venipuncture. (B) A urine sample collected by catheterization. (iv) Beginning January 1, 2024, CMS updates the specimen collection fee amount under paragraph (a)(1) of this section for each calendar year by the percent change in the Consumer Price Index for All Urban Consumers (CPI-U) (U.S. city average) for the 12-month period ending June 30th of the year preceding the update year. (v) For a specimen collected from a Medicare beneficiary. (2) Payment for travel allowance General requirement. (ii) Travel allowance basis. (A) Flat-rate travel allowance. (B) Per-mile travel allowance. ( 1 ( 2 (iii) Travel allowance amount Eligible miles. (B) Travel allowance mileage rate. (C) Travel allowance amount calculation. 1 ( 2 (b) [Reserved] [87 FR 70225, Nov. 18, 2022] Subpart H—Fee Schedule for Ambulance Services Source: 67 FR 9132, Feb. 27, 2002, unless otherwise noted. § 414.601 Purpose. This subpart implements section 1834(l) of the Act by establishing a fee schedule for the payment of ambulance services. Section 1834(l) of the Act requires that, except for services furnished by certain critical access hospitals (see § 413.70(b)(5) of this chapter), payment for all ambulance services, otherwise previously payable on a reasonable charge basis or retrospective reasonable cost basis, be made under a fee schedule. Section 1834(l)(17) of the Act requires the development of a data collection system to collect cost, revenue, utilization, and other information determined appropriate from providers of services and suppliers of ground ambulance services. [67 FR 9132, Feb. 27, 2002, as amended at 84 FR 63193, Nov. 15, 2019] § 414.605 Definitions. As used in this subpart, the following definitions apply to both land and water (hereafter collectively referred to as “ground”) ambulance services and to air ambulance services unless otherwise specified: Advanced life support (ALS) assessment Advanced life support (ALS) intervention Advanced life support, level 1 (ALS1) Advanced life support, level 2 (ALS2) (1) Manual defibrillation/cardioversion. (2) Endotracheal intubation. (3) Central venous line. (4) Cardiac pacing. (5) Chest decompression. (6) Surgical airway. (7) Intraosseous line. (8) Prehospital blood transfusion which includes: (i) Administration of low titer O+ and O− whole blood (WBT); (ii) Administration of packed red blood cells (PRBCs); (iii) Administration of plasma; or (iv) Administration of a combination of PRBCs and plasma. Advanced life support (ALS) personnel Basic life support (BLS) Conversion factor (CF) Emergency response Fixed wing air ambulance (FW) Geographic adjustment factor (GAF) Ground ambulance organization Loaded mileage Paramedic ALS intercept (PI) Point of pick-up Relative value units (RVUs) Rotary wing air ambulance (RW) Rural adjustment factor (RAF) Rural area Specialty care transport (SCT) Urban area [67 FR 9132, Feb. 27, 2002, as amended at 68 FR 67693, Dec. 5, 2003; 71 FR 69787, Dec. 1, 2006; 80 FR 71382, Nov. 16, 2015; 84 FR 63193, Nov. 15, 2019; 89 FR 98559, Dec. 9, 2024] § 414.610 Basis of payment. (a) Method of payment. (b) Mandatory assignment. (c) Formula for computation of payment amounts. (1) Ground ambulance service levels. (i) For services furnished during the period July 1, 2004 through December 31, 2006, ambulance services originating in— (A) Urban areas (both base rate and mileage) are paid based on a rate that is 1 percent higher than otherwise is applicable under this section; and (B) Rural areas (both base rate and mileage) are paid based on a rate that is 2 percent higher than otherwise is applicable under this section. (ii) For services furnished during the period July 1, 2008 through September 30, 2025, ambulance services originating in. (A) Urban areas (both base rate and mileage) are paid based on a rate that is 2 percent higher than otherwise is applicable under this section. (B) Rural areas (both base rate and mileage) are paid based on a rate that is 3 percent higher than otherwise is applicable under this section. (iii) The service-level base rate is then adjusted by the GAF. Compare this amount to the actual charge. The lesser of the actual charge or the GAF adjusted base rate amount is added to the lesser of the actual mileage charges or the payment rate per mile, multiplied by the number of miles that the beneficiary was transported. When applicable, the appropriate RAF is applied to the ground mileage rate to determine the appropriate payment rates. The RVU scale for the ambulance fee schedule is as follows: Service level Relative BLS 1.00 BLS-Emergency 1.60 ALS1 1.20 ALS1-Emergency 1.90 ALS2 2.75 SCT 3.25 PI 1.75 (2) Air ambulance service levels. (3) Loaded mileage. (4) Geographic adjustment factor (GAF). (5) Rural adjustment factor (RAF). (ii) For services furnished during the period July 1, 2004 through September 30, 2025, the payment amount for the ground ambulance base rate is increased by 22.6 percent where the point of pickup is in a rural area determined to be in the lowest 25 percent of rural population arrayed by population density. The amount of this increase is based on CMS's estimate of the ratio of the average cost per trip for the rural areas in the lowest quartile of population compared to the average cost per trip for the rural areas in the highest quartile of population. In making this estimate, CMS may use data provided by the GAO. (6) Multiple patients. (7) Payment rate for mileage greater than 50 miles. (8) Transport of an individual with end-stage renal disease for renal dialysis services. (9) Payment reduction for failure to report data. (d) Payment. (e) Point of pick-up. (f) Updates. (g) Adjustments. (h) Treatment of certain areas for payment for air ambulance services. [67 FR 9132, Feb. 27, 2002, as amended at 68 FR 67693, Dec. 5, 2003; 69 FR 40292, July 1, 2004; 71 FR 69787, Dec. 1, 2006; 73 FR 69937, Nov. 19, 2008; 74 FR 62012, Nov. 25, 2009; 75 FR 73625, Nov. 29, 2010; 76 FR 70315, Nov. 10, 2011; 77 FR 69368, Nov. 16, 2012; 78 FR 74820, Dec. 10, 2013; 79 FR 68005, Nov. 13, 2014; 80 FR 71382, Nov. 16, 2015; 83 FR 60074, Nov. 23, 2018; 84 FR 63193, Nov. 15, 2019; 88 FR 79531, Nov. 16, 2023; 90 FR 50008, Nov. 5, 2025] § 414.615 Transition to the ambulance fee schedule. The fee schedule for ambulance services will be phased in over 5 years beginning April 1, 2002. Subject to the first sentence in § 414.610(a), payment for services furnished during the transition period is made based on a combination of the fee schedule payment for ambulance services and the amount the program would have paid absent the fee schedule for ambulance services, as follows: (a) 2002 Payment. (b) 2003 Payment. (c) 2004 Payment. (d) 2005 Payment. (e) 2006 and Beyond Payment. (f) Updates. (g) Exception. § 414.617 Transition from regional to national ambulance fee schedule. For services furnished during the period July 1, 2004 through December 31, 2009, the amount for the ground ambulance base rate is subject to a floor amount determined by establishing nine fee schedules based on each of the nine census divisions using the same methodology as used to establish the national fee schedule. If the regional fee schedule methodology for a given census division results in an amount that is less than or equal to the national ground base rate, then it is not used, and the national FS amount applies. If the regional fee schedule methodology for a given census division results in an amount that is greater than the national ground base rate, then the FS portion of the base rate for that census division is equal to a blend of the national rate and the regional rate in accordance with the following schedule: Time period Regional percent National percent 7/1/04-12/31/04 80 20 CY 2005 60 40 CY 2006 40 60 CY 2007-CY 2009 20 80 CY 2010 and thereafter 0 100 [69 FR 40292, July 1, 2004] § 414.620 Publication of the ambulance fee schedule. (a) Changes in payment rates resulting from incorporation of the annual inflation factor and the productivity adjustment as described in § 414.610(f) will be announced by CMS by instruction and on the CMS Web site. (b) CMS will follow applicable rulemaking procedures in publishing revisions to the fee schedule for ambulance services that result from any factors other than those described in § 414.610(f). [75 FR 73626, Nov. 29, 2010] § 414.625 Limitation on review. There will be no administrative or judicial review under section 1869 of the Act or otherwise of the amounts established under the fee schedule for ambulance services, including the following: (a) Establishing mechanisms to control increases in expenditures for ambulance services. (b) Establishing definitions for ambulance services that link payments to the type of services provided. (c) Considering appropriate regional and operational differences. (d) Considering adjustments to payment rates to account for inflation and other relevant factors. (e) Phasing in the application of the payment rates under the fee schedule in an efficient and fair manner. § 414.626 Data reporting by ground ambulance organizations. (a) Definitions. Data collection period Data reporting period For a year Medicare Ground Ambulance Data Collection Instrument (b) Data collection and submission requirement. (1) Within 30 days of the date that CMS notifies a ground ambulance organization under paragraph (c)(3) of this section that it has selected the ground ambulance organization to report data under this section, the ground ambulance organization must select a data collection period that corresponds with its annual accounting period and provide the start date of that data collection period to CMS or its contractor. (2) Collect during its selected data collection period the data necessary to complete the Medicare Ground Ambulance Data Collection Instrument. (3) Submit to CMS a completed Medicare Ground Ambulance Data Collection Instrument during the data reporting period that corresponds to the ground ambulance organization's selected data collection period. (c) Representative sample. Random sample. (i) Provider versus supplier status and ownership (for-profit, non-profit, and government); (ii) Service area population density (transports originating in primarily urban, rural, and super rural zip codes); and (iii) Medicare-billed transport volume categories. (2) Selection eligibility. (3) Notification of selection for a year. (4) Limitation. (d) Hardship exemption. (1) To request a hardship exemption, the ground ambulance organization must submit a request to CMS, in the form and manner specified by CMS, within 90 calendar days of the date that CMS notified the ground ambulance organization that it would receive a 10 percent payment reduction as a result of not submitting sufficient information under the data collection system. The request form must include all of the following: (i) Ground ambulance organization name. (ii) NPI number. (iii) Ground ambulance organization address. (iv) Chief executive officer and any other designated personnel contact information, including name, email address, telephone number and mailing address (must include a physical address, a post office box address is not acceptable). (v) Reason for requesting a hardship exemption. (vi) Evidence of the impact of the hardship (such as photographs, newspaper or other media articles, financial data, bankruptcy filing, etc.). (vii) Date when the ground ambulance organization would be able to begin collecting data under paragraph (b) of this section. (viii) Date and signature of the chief executive officer or other designated personnel of the ground ambulance organization. (2) CMS will provide a written response to the hardship exemption request within 30 days of its receipt of the hardship exemption form. (e) Notification of non-compliance and informal review. Notification of non-compliance. (2) Informal review. (i) Ground ambulance organization name. (ii) NPI number. (iii) Chief executive officer and any other designated personnel contact information, including name, email address, telephone number and mailing address with the street location of the ground ambulance organization. (iv) Ground ambulance organization's selected data collection period and data reporting period. (v) A statement of the reasons why the ground ambulance organization does not agree with CMS' determination and any supporting documentation. (f) Public availability of data (g) Limitations on review. [84 FR 63193, Nov. 15, 2019, as amended at 86 FR 65669, Nov. 19, 2021; 87 FR 70226, Nov. 18, 2022] Subpart I—Payment for Drugs and Biologicals Source: 69 FR 1116, Jan. 7, 2004, unless otherwise noted. § 414.701 Purpose. This subpart implements section 1842(o) of the Act by specifying the methodology for determining the payment allowance limit for drugs and biologicals covered under Part B of Title XVIII of the Act (hereafter in this subpart referred to as the “program”) that are not paid on a cost or prospective payment system basis. Examples of drugs that are subject to the rules contained in this subpart are: Drugs furnished incident to a physician's service; durable medical equipment (DME) drugs; separately billable drugs at independent dialysis facilities not under the ESRD composite rate; statutorily covered drugs, for example, influenza, pneumococcal, hepatitis, and COVID-19 vaccines, antigens, hemophilia blood clotting factor, immunosuppressive drugs and certain oral anti-cancer drugs. [85 FR 71197, Nov. 6, 2020] § 414.704 Definitions. As used in this subpart, the following definition applies. Drug § 414.707 Basis of payment. (a) Method of payment. (i) The actual charge on the claim for program benefits; or (ii) 85 percent of the average wholesale price determined as of April 1, 2003, subject to the exceptions as specified in paragraphs (a)(2) through (a)(8) of this section. (2) The payment limits for the following drugs are calculated using 95 percent of the average wholesale price: (i) Blood clotting factors. (ii) A drug or biological furnished during 2004 that was not available for Medicare payment as of April 1, 2003. (iii) Pneumococcal, influenza, and COVID-19 vaccines as well as hepatitis B vaccine that is furnished to individuals at high or intermediate risk of contracting hepatitis B (as defined in § 410.63(a) of this subchapter). (iv) A drug or biological furnished during 2004 in connection with the furnishing of renal dialysis services if separately billed by renal dialysis facilities. (3) The payment limits for infusion drugs furnished through a covered item of durable medical equipment are calculated using 95 percent of the average wholesale price in effect on October 1, 2003. (4) The payments limits for drugs contained in the following table are calculated based on the percentages of the average wholesale price determined as of April 1, 2003 that are specified in the table. Drug Percentage used to calculate 2004 payment limit EPOETIN ALFA 87 LEUPROLIDE ACETATE 81 GOSERELIN ACETATE 80 RITUXIMAB 81 PACLITAXEL 81 DOCETAXEL 80 CARBOPLATIN 81 IRINOTECAN 80 GEMCITABINE HCL 80 PAMIDRONATE DISODIUM 85 DOLASETRON MESYLATE 80 FILGRASTIM 81 HYLAN G-F 20 82 MYCOPHENOLATE MOFETIL 86 GRANISETRON HCL 80 ONDANSETRON 87 VINORELBINE TARTATE 81 SARGRAMOSTIM 80 TOPOTECAN 84 IPRATROPIUM BROMIDE 80 ALBUTEROL SULFATE 80 IMMUNE GLOBULIN 80 LEUCOVORIN CALCIUM 80 DOXORUBICIN HCL 80 DEXAMETHOSONE SODIUM PHOSPHATE 86 HEPARIN SODIUM LOCK-FLUSH 80 CROMOLYN SODIUM 80 ACETYLCYSTEINE 80 (5) The payment limits for imiglucerase and alglucerase are calculated using 94 percent of the average wholesale price determined as of April 1, 2003. (6) Exception. The payment limit for a drug otherwise subject to paragraph (a)(1)(ii) or paragraph (a)(4) of this section may be calculated using the percentage of the average wholesale price as the Secretary deems appropriate based on data and information submitted by the drug manufacturer. (i) The manufacturer must submit data after October 15, 2003 and before January 1, 2004. (ii) The percentage only applies for drugs furnished on or after April 1, 2004. (7) In the case of blood and blood products (other than blood clotting factors), the payment limits shall be determined in the same manner as such payment limit was determined on October 1, 2003. (b) Mandatory assignment. (c) Mandatory reporting of anemia quality indicators. (1) Each request for payment for anti-anemia drugs furnished to treat anemia resulting from the treatment of cancer must report the beneficiary's most recent hemoglobin or hematocrit level; (2) Each request for payment for use of erythropoiesis stimulating agents must report the beneficiary's most recent hemoglobin or hematocrit level. [69 FR 1116, Jan. 7, 2004, as amended at 72 FR 66402, Nov. 27, 2007; 85 FR 71197, Nov. 6, 2020; 87 FR 70226, Nov. 18, 2022] Subpart J—Submission of Manufacturer's Average Sales Price Data Source: 69 FR 17938, Apr. 6, 2004, unless otherwise noted. § 414.800 Purpose. This subpart implements section 1847A of the Act by specifying the requirements for submission of a manufacturer's average sales price data for certain drugs and biologicals covered under Part B of Title XVIII of the Act that are paid under sections 1842(o)(1)(D), 1847A, and 1881(b)(13)(A)(ii) of the Act. § 414.802 Definitions. As used in this subpart, unless the context indicates otherwise— Biological Bona fide service fees Bundled arrangement Drug Manufacturer (1) Production, preparation, propagation, compounding, conversion or processing of prescription drug products, either directly or indirectly by extraction from substances of natural origin, or independently by means of chemical synthesis, or by a combination of extraction and chemical synthesis. (2) The packaging, repackaging, labeling, relabeling, or distribution of prescription drug products. Unit [69 FR 17938, Apr. 6, 2004, as amended at 71 FR 48143, Aug. 18, 2006; 71 FR 69787, Dec. 1, 2006; 74 FR 62012, Nov. 25, 2009; 76 FR 73473, Nov. 28, 2011; 86 FR 65669, Nov. 19, 2021; 90 FR 50008, Nov. 5, 2025] § 414.804 Basis of payment. (a) Calculation of manufacturer's average sales price. (2) Price concessions. (A) Volume discounts. (B) Prompt pay discounts. (C) Cash discounts. (D) Free goods that are contingent on any purchase requirement. (E) Chargebacks and rebates (other than rebates under the Medicaid program). (ii) For the purposes of paragraph (a)(2)(i), bona fide services fees are not considered price concessions. (iii) The discounts in a bundled arrangement as defined at § 414.802, including those discounts resulting from a contingent arrangement, are allocated proportionately to the dollar value of the units of all drugs or products sold under the bundled arrangement. (iv) For bundled arrangements where multiple drugs are discounted, the aggregate value of all the discounts in the bundled arrangement must be proportionally allocated across all the drugs or products in the bundle. (3) To the extent that data on price concessions, as described in paragraph (a)(2) of this section, are available on a lagged basis, the manufacturer must estimate this amount in accordance with the methodology described in this paragraph. (i)(A) For each National Drug Code with at least 12 months of sales (including products for which the manufacturer has redesignated the National Drug Code for the specific product and package size and has 12 months of sales across the prior and current National Drug Codes), after adjusting for exempted sales, the manufacturer calculates a percentage equal to the sum of the price concessions for the most recent 12-month period available associated with sales subject to the average sales price reporting requirement divided by the total in dollars for the sales subject to the average sales price reporting requirement for the same 12-month period. (B) For each National Drug Code with less than 12 months of sales, the calculation described in paragraph (i)(A) of this section is performed for the time period equaling the total number of months of sales. (ii) The manufacturer multiplies the applicable percentage described in paragraph (a)(3)(i)(A) or (a)(3)(i)(B) of this section by the total in dollars for the sales subject to the average sales price reporting requirement (after adjusting for exempted sales) for the quarter being submitted. (The manufacturer must carry a sufficient number of decimal places in the calculation of the price concessions percentage in order to round accurately the net total sales amount for the quarter to the nearest whole dollar.) The result of this multiplication is then subtracted from the total in dollars for the sales subject to the average sales price reporting requirement (after adjusting for exempted sales) for the quarter being submitted. (iii) The manufacturer uses the result of the calculation described in paragraph (a)(3)(ii) of this section as the numerator and the number of units sold in the quarter (after adjusting for exempted sales) as the denominator to calculate the manufacturer's average sales price for the National Drug Code for the quarter being submitted. (iv) Example. (4) Exempted sales. (ii) In determining nominal sales exempted under section 1927(c)(1)(C)(ii)(III) of the Act, the manufacturer calculates the average manufacturer price as defined in section 1927(k) of the Act and then identifies sales that are eligible to be considered a nominal sale under section 1927(c)(1)(D) of the Act and are at less than 10 percent of the average manufacturer price. To identify nominal sales, the manufacturer must use the average manufacturer price for the calendar quarter that is the same calendar quarter as the average sales price reporting period. (5) Submission requirements. (i) The manufacturer's average sales price, which must be calculated by the manufacturer every calendar quarter. The first quarter submission must be submitted by April 30, 2004. (ii) Effective January 1, 2026, reasonable assumptions for calculations of the manufacturer's ASP, consistent with the general requirements and intent of the Act, Federal regulations, and its customary business practices including documentation of the methodology used to determine fair market value. (iii) Effective January 1, 2026, certification letter from the recipient of a bona fide service fee as evidence that the fee is not passed on in whole or in part to a client or customer of the recipient of the fee, whether or not the entity takes title to the drug. (6) The manufacturer's average sales price must be calculated based on the amount of product in a vial or other container as conspicuously reflected on the FDA approved label as defined by section 201(k) of the Food, Drug, and Cosmetic Act. (7) Each report must be certified by one of the following: (i) The manufacturer's Chief Executive Officer (CEO). (ii) The manufacturer's Chief Financial Officer (CFO). (iii) An individual who has delegated authority to sign for, and who reports directly to, the manufacturer's CEO or CFO. (b) [Reserved] [69 FR 17938, Apr. 6, 2004, as amended at 69 FR 55764, Sept. 16, 2004; 70 FR 70332, Nov. 21, 2005; 71 FR 69787, Dec. 1, 2006; 72 FR 18914, Apr. 16, 2007; 75 FR 73626, Nov. 29, 2010; 90 FR 50009, Nov.5, 2025] § 414.806 Penalties associated with misrepresentation and the failure to submit timely and accurate ASP data. (a) Misrepresentation (b) Failure to provide timely information or the submission of false information (2) For a manufacturer that has not entered into and does not have in effect a rebate agreement under section 1927 of the Act, sections 1847A(d)(4)(B) and (C) of the Act specify the penalties associated with a manufacturer's failure to submit timely information or the submission of false information. [86 FR 65669, Nov. 19, 2021] Subpart K—Payment for Drugs and Biologicals Under Part B Source: 69 FR 66424, Nov. 15, 2004, unless otherwise noted. § 414.900 Basis and scope. (a) This subpart implements sections 1842(o), 1847A, and 1847B of the Act and outlines two payment methodologies applicable to drugs and biologicals covered under Medicare Part B that are not paid on a cost or prospective payment system basis. (b) Examples of drugs that are subject to the requirements specified in this subpart are: (1) Drugs furnished incident to a physician's service; durable medical equipment (DME) drugs. (2) Separately billable drugs at independent dialysis facilities not under the ESRD composite rate. (3) Statutorily covered drugs, for example— (i) Influenza. (ii) Pneumococcal, Hepatitis B, and COVID-19 vaccines. (iii) Antigens. (iv) Hemophilia blood clotting factor. (v) Immunosuppressive drugs. (vi) Certain oral anti-cancer drugs. [69 FR 66424, Nov. 15, 2004, as amended at 70 FR 39093, July 6, 2005; 85 FR 71197, Nov. 6, 2020] § 414.902 Definitions. As used in this subpart, unless the context indicates otherwise— Applicable five-year period (1) For a qualifying biosimilar biological product for which payment has been made under section 1847A(b)(8) of the Act as of September 30, 2022, the 5-year period beginning on October 1, 2022; and (2) For a qualifying biosimilar biological product for which payment is first made under section 1847A(b)(8) of the Act during a calendar quarter during the period beginning October 1, 2022 and ending December 31, 2027, the 5-year period beginning on the first day of such calendar quarter during which such payment is first made. Approved CAP vendor Bid Biological Biosimilar biological product CAP drug Competitive acquisition area Competitive acquisition program Designated carrier Drug Emergency delivery Emergency situation Local carrier Low volume dose Manufacturer's average sales price Multiple source drug New refund quarter Pacific Territories Participating CAP physician Participating CAP physician election agreement Prescription order Qualifying biosimilar biological product Reference biological product Refundable single-dose container or single-use package drug (1) A single source drug or biological or a biosimilar biological product for which payment is made under this part and that is— (i) Furnished from a single-dose container or single-use package based on FDA-approved labeling or product information; or (ii) Furnished from an ampule for which product labeling does not have discard statement or language indicating if the container is single-dose container, single-use package, multiple-dose container, or single-patient-use container; or (iii) Furnished from a container with a total labeled volume of 2 mL or less for which product labeling does not have language indicating if the container is single-dose container, single-use package, multiple-dose container, or single-patient-use container. (2) Excludes— (i) A drug that is a therapeutic radiopharmaceutical, a diagnostic radiopharmaceutical, or an imaging agent as identified in the drug's FDA-approved labeling. (ii) A drug for which the FDA-approved labeling for any National Drug Code assigned to a billing and payment code of such drug requires filtration during the drug preparation process, prior to dilution and administration and that any unused portion of such drug after the filtration process be discarded after the completion of such filtration process. (iii) A drug approved or licensed by the FDA on or after November 15, 2021, until the last day of the sixth full quarter for which the drug has been marketed (as reported to CMS) for the first National Drug Code assigned to the billing and payment code of such drug. (iv) A drug approved or licensed by FDA on or after November 15, 2021 and for which the date the drug was first marketed (as reported to CMS) does not adequately approximate the date of first payment under Part B due to an applicable national coverage determination, until the last day of the sixth full quarter for which the drug has been covered and paid under Medicare Part B for the first National Drug Code assigned to the billing and payment code of such drug. Routine delivery Single source drug Timely delivery Unit Updated refund quarter Wholesale acquisition cost (WAC) [69 FR 66424, Nov. 15, 2004, as amended at 70 FR 39093, July 6, 2005; 75 FR 73626, Nov. 29, 2010; 87 FR 70226, Nov. 18, 2022; 88 FR 79531, Nov. 16, 2023; 89 FR 98559, Dec. 9, 2024; 90 FR 50009, Nov. 5, 2025] § 414.904 Average sales price as the basis for payment. (a) Method of payment. (1) The actual charge on the claim for program benefits; or (2) 106 percent of the average sales price, subject to the applicable limitations specified in paragraph (d) of this section or subject to the exceptions described in paragraph (e) of this section. (3) For purposes of this paragraph— (i) CMS calculates an average sales price payment limit based on the amount of product included in a vial or other container as reflected on the FDA-approved label. (ii) Additional product contained in the vial or other container does not represent a cost to providers and is not incorporated into the ASP payment limit. (iii) No payment is made for amounts of product in excess of that reflected on the FDA-approved label. (b) Multiple source drugs Average sales prices. (2) Calculation of the average sales price. (A) Computing the sum of the products (for each National Drug Code assigned to the drug products) of the manufacturer's average sales price and the total number of units sold; and (B) Dividing that sum by the sum of the total number of units sold for all NDCs assigned to the drug products. (ii) For dates of service on or after April 1, 2008, the average sales price is determined by— (A) Computing the sum of the products (for each National Drug Code assigned to such drug products) of the manufacturer's average sales price, determined by the Secretary without dividing such price by the total number of billing units for the National Drug Code for the billing and payment code and the total number of units sold; and (B) Dividing the sum determined under clause (A) by the sum of the products (for each National Drug Code assigned to such drug products) of the total number of units sold and the total number of billing units for the National Drug Code for the billing and payment code. (iii) For purposes of this subsection and subsection (c), the term billing unit means the identifiable quantity associated with a billing and payment code, as established by CMS. (c) Single source drugs Average sales price. (2) Calculation of the average sales price. (A) Computing the sum of the products (for each National Drug Code assigned to the drug product) of the manufacturer's average sales price and the total number of units sold; and (B) Dividing that sum by the sum of the total number of units sold for all NDCs assigned to the drug product. (ii) For dates of service on or after April 1, 2008, the average sales price is determined by— (A) Computing the sum of the products (for each National Drug Code assigned to such drug products) of the manufacturer's average sales price, determined by the Secretary without dividing such price by the total number of billing units for the National Drug Code for the billing and payment code and the total number of units sold; and (B) Dividing the sum determined under clause (A) by the sum of the products (for each National Drug Code assigned to such drug products) of the total number of units sold and the total number of billing units for the National Drug Code for the billing and payment code. (d) Limitations on the average sales price Wholesale acquisition cost for a single source drug. (2) Payment limit for a drug furnished to an end-stage renal disease patient. (ii) Except as provided in paragraph (a) of this section, the payment for drugs and biologicals, furnished to an end-stage renal disease patient that is separately billed by an end-stage renal disease facility, is based on 106 percent of the average sales price. (iii) Effective for drugs and biologicals furnished in CY 2006 and subsequent calendar years, the payment for such drugs and biologicals furnished in connection with renal dialysis services and separately billed by freestanding and hospital-based renal dialysis facilities not paid on a cost basis is the amount determined under section 1847A of the Act. (3) Widely available market price and average manufacturer price. (i) The payment amount substitution will be applied at the next average sales price payment amount calculation period after the Inspector General informs the Secretary (at such times specified by the Secretary) about billing codes for which the average sales price has exceeded the average manufacturer price by the applicable threshold percentage, and will remain in effect for 1 quarter after publication. (ii) Payment at 103 percent of the average manufacturer price for a billing code will be applied at such times when all of the following criteria are met: (A) The threshold for making price substitutions, as defined in paragraph (d)(3)(iii) of this section is met. (B) 103 percent of the average manufacturer price is less than the 106 percent of the average sales price for the quarter in which the substitution would be applied. (C) Beginning in 2013, the drug and dosage form described by the HCPCS code is not identified by the FDA to be in short supply at the time that ASP calculations are finalized. (iii) The applicable percentage threshold for average manufacturer price comparisons is 5 percent and is reached when— (A) The average sales price for the billing code has exceeded the average manufacturer price for the billing code by 5 percent or more in 2 consecutive quarters, or 3 of the previous 4 quarters immediately preceding the quarter to which the price substitution would be applied; and (B) The average manufacturer price for the billing code is calculated using the same set of National Drug Codes used for the average sales price for the billing code. (iv) The applicable percentage threshold for widely available market price comparisons is 5 percent. (4) Payment adjustment for certain drugs for which there is a self-administered version In general (ii) Exception (iii) Special rule for certain billing and payment codes (iv) Lesser-of methodology (A) The payment limit determined under section 1847A of the Act for such billing and payment code if each National Drug Code for such product so identified under section 1847A(g)(1) of the Act were excluded from such determination; and (B) The payment limit otherwise determined under section 1847A of the Act for such billing and payment code without application of section 1847A(g) of the Act. (v) NDC changes (e) Exceptions to the average sales price Vaccines. (2) Infusion drugs furnished through a covered item of durable medical equipment. (3) Blood and blood products. (4) Payment amount in a case where the average sales price during the first quarter of sales is unavailable. (i) In general. (A) For dates of service before January 1, 2019, the payment amount for the drug is based on the wholesale acquisition cost or the Medicare Part B drug payment methodology in effect on November 1, 2003. (B) For dates of service on or after January 1, 2019, the payment amount for the drug is an amount not to exceed 103 percent of the wholesale acquisition cost or based on the Medicare Part B drug payment methodologies in effect on November 1, 2003. (ii) Limitation on payment amount for biosimilar biological products during initial period. (A) The payment amount for the biosimilar biological product as determined under clause (e)(4)(i)(B) of this section or (B) 106 percent of the amount determined under section 1847A(b)(1)(B) of the Act for the reference biological product (as defined in § 414.902). (5) Treatment of certain drugs. (i) Each single source drug or biological described in section 1842(o)(1)(G) that is treated as a multiple source drug because of the application of section 1847A(c)(6)(C)(ii) is the lower of— (A) The payment amount that would be determined for such drug or biological applying section 1847A(c)(6)(C)(ii); or (B) The payment amount that would have been determined for such drug or biological if section 1847A(c)(6)(C)(ii) were not applied. (ii) A multiple source drug described in section 1842(o)(1)(G) (excluding a drug or biological that is treated as a multiple source drug because of the application of section 1847A(c)(6)(C)(ii)) is the lower of— (A) The payment amount that would be determined for such drug or biological taking into account the application of section 1847A(c)(6)(C)(ii); or (B) The payment amount that would have been determined for such drug or biological if section 1847A(c)(6)(C)(ii) were not applied. (6) Radiopharmaceuticals furnished in settings other than the hospital outpatient department. (f) Except as otherwise specified (see paragraph (e)(2) of this section) for infusion drugs, the payment limits are updated quarterly. (g) The payment limit is computed without regard to any special packaging, labeling, or identifiers on the dosage form or product or package. (h) The payment amount is subject to applicable deductible and coinsurance. (i) Manufacturer's average sales price (ASP) data not available prior to the publication deadline for quarterly payment limits. (1) For a multiple source drug (as defined in § 414.902)— (i) In circumstances in which negative or zero manufacturer's ASP data is reported for one or more, but not all, NDCs associated with a billing and payment code for that drug for a given quarter, the payment limit for the given quarter is calculated using only NDCs for that drug with positive manufacturer's ASP data, except in circumstances described in paragraph (i)(1)(iii) of this section. (ii) In circumstances in which negative or zero manufacturer's ASP data is reported for all NDCs associated with a billing and payment code for that drug for a given quarter, the payment limit for the given quarter is calculated by carrying over all positive manufacturer's ASP data from the most recently available previous quarter with positive manufacturer's ASP data for at least one NDC until at least one NDC for the drug has positive manufacturer's ASP data for a quarter. (iii) In circumstances in which manufacturer's ASP data is not available and the unavailability of the manufacturer's ASP data results in a significant change in the ASP payment limit compared to the previous quarter, the payment limit is calculated by carrying over the most recently available ASP data for the individual NDC(s), adjusted by the weighted average of the change in the manufacturer's ASP data for the NDCs that were reported for both the most recently available previous quarter and the current quarter. (2) For a single source drug, excluding biosimilar biological products (both as defined in § 414.902)— (i) In circumstances in which negative or zero manufacturer's ASP data is reported for one or more, but not all, NDCs associated with a billing and payment code for that drug for a given quarter, the payment limit for the given quarter is calculated using only NDCs for that drug with positive manufacturer's ASP data. (ii) In circumstances in which negative or zero manufacturer's ASP data is reported for all NDCs associated with a billing and payment code for that drug for a given quarter, the payment limit for the given quarter is the lesser of the following until at least one NDC for the drug has positive manufacturer's ASP data for a quarter: (A) 106 percent of the volume-weighted average of the most recently available positive manufacturer's ASP data from a previous quarter in which at least one NDC for the drug has positive manufacturer's ASP data for the quarter. If the payment limit from such quarter was based on 106 percent of the wholesale acquisition cost because of the application of paragraph (d)(1) of this section, that payment limit is carried over; or (B) 106 percent of the wholesale acquisition cost. If there is more than one WAC per billing unit for the drug, the payment limit is set using the lowest WAC per billing unit. (3) For a biosimilar biological product (as defined in § 414.902)— (i) In circumstances in which negative or zero manufacturer's ASP data is reported for one or more, but not all, NDCs for a given quarter, the payment limit for the given quarter is calculated using only NDCs with positive manufacturer's ASP data. (ii) In circumstances in which negative or zero manufacturer's ASP data is reported for all NDCs for a given quarter, the payment limit for the given quarter is the sum of the following until at least one NDC for the drug has positive manufacturer's ASP data for a quarter: (A) The volume-weighted average of the most recently available positive manufacturer's ASP data from a previous quarter; and (B) Either: ( 1 ( 2 (j) Biosimilar biological products In general. (2) Temporary increase in Medicare Part B payment for qualifying biosimilar biological products. [69 FR 66424, Nov. 15, 2004, as amended at 70 FR 70332, Nov. 21, 2005; 71 FR 69788, Dec. 1, 2006; 72 FR 66402, Nov. 27, 2007; 73 FR 69937, Nov. 19, 2008; 73 FR 80304, Dec. 31, 2008; 74 FR 62012, Nov. 25, 2009; 75 FR 73626, Nov. 29, 2010; 76 FR 73473, Nov. 28, 2011; 77 FR 69368, Nov. 16, 2012; 80 FR 71382, Nov. 16, 2015; 82 FR 53363, Nov. 15, 2017; 83 FR 60074, Nov. 23, 2018; 85 FR 71197, Nov. 6, 2020; 86 FR 65669, Nov. 19, 2021; 87 FR 70226, Nov. 18, 2022; 88 FR 79532, Nov. 16, 2023; 89 FR 98559, Dec. 9, 2024] § 414.906 Competitive acquisition program as the basis for payment. (a) Program payment. (1) The CAP drug is supplied under the CAP by an approved CAP vendor as specified in § 414.908(b). (2) The claim for the prescribed drug is submitted by the approved CAP vendor that supplied the drug, and payment is made only to that vendor. (3) The approved CAP vendor collects applicable deductible and coinsurance with respect to the drug furnished under the CAP only after the drug is administered to the beneficiary. (4) The approved CAP vendor delivers CAP drugs directly to the participating CAP physician in unopened vials or other original containers as supplied by the manufacturer or from a distributor that has acquired the products directly from the manufacturer and includes language with the shipping material stating that the drug was acquired in a manner consistent with all statutory requirements. If the approved CAP vendor opts to split shipments, the participating CAP physician must be notified in writing which can be included with the initial shipment, and each incremental shipment must arrive at least 2 business days before the anticipated date of administration. (5) The approved CAP vendor bills Medicare only for the amount of the drug administered to the patient, and the beneficiary's coinsurance will be calculated from the quantity of drug that is administered. (b) Exceptions to competitive acquisition. (1) Is not likely to result in significant savings; or (2) Is likely to have an adverse impact on access to those drugs. (c) Computation of payment amount. (1) Single payment amount. (ii) The single payment amount is then updated quarterly based on the approved CAP vendor's reasonable net acquisition costs for that category as determined by CMS, and limited by the weighted payment amount established under section 1847A of the Act across all drugs for which a composite bid is required in the category. (iii) The payment amount for each other drug for which the approved CAP vendor submits a bid in accordance with § 414.910 of this subpart and each other drug that is approved by CMS for the approved CAP vendor to furnish under the CAP is also updated quarterly based on the approved CAP vendor's reasonable net acquisition costs for each HCPCS code and limited by the payment amount established under section 1847A of the Act. (2) Updates to payment amount. (ii) For subsequent quarters, each approved CAP vendor must report to CMS or its designee RNAC data for a quarter of CAP drug purchases within 30 days of the close of that quarter. (iii) For all quarters, only RNAC data from approved CAP vendors that are supplying CAP drugs under their CAP contract at the time updates are being calculated must be used to calculate updated CAP payment amounts. (iv) CMS excludes such RNAC data submitted by an approved CAP vendor if, during the time calculations are being done, CMS knows that the approved CAP vendor will not be under contract for the applicable quarterly update. (v) The payment amount weights must be calculated based on the more recent of the following: (A) Contract bidding weights. (B) CAP claims data. (vi) The payment limit must be determined using the most recent payment limits available to CMS under section 1847A of the Act. (vii) The following payment amount update calculation must be applied for the group of all drugs for which a composite bid is required. (A) The most recent previous composite payment amount for the group is updated by— ( 1 ( 2 ( 3 (B) The median percent change, subject to the limit described in paragraph (c)(1) of this section, must be the update percentage for that quarter. (C) The single update percentage must be applied to the payment amount for each drug in the group of drugs for which a composite bid is required in the category. (viii) The following payment amount update calculation must be applied for each of the following items: Each HCPCS code not included in the composite bid list; Each HCPCS code added to the drug list during the contract period; and each drug that has not yet been assigned a HCPCS code, but for which a HCPCS code will be established. (A) The most recent previous payment amount for each drug must be updated by calculating the percent change in reasonable net acquisition costs for each approved CAP vendor, then calculating the median of all participating approved CAP vendors' adjusted CAP payment amounts. (B) The median percent change calculated for each drug, subject to the limit described in paragraph (c)(1) of this section, must be applied to the payment amount for each drug. (3) Alternative payment amount. (i) The drug is properly assigned to a category established under the CAP; and (ii) It is a drug for which a HCPCS code must be established. (d) Adjustments. (e) Resupply of participating CAP physician drug inventory. (1) The drugs were required immediately. (2) The participating CAP physician could not have anticipated the need for the drugs. (3) The approved CAP vendor could not have delivered the drugs in a timely manner. For purposes of this section, timely manner means delivery within the emergency delivery timeframe, as defined in § 414.902. (4) The participating CAP physician administered the drugs in an emergency situation, as defined in § 414.902. (f) Substitution or addition of drugs on an approved CAP vendor's CAP drug list Short-term substitution of a CAP drug. (i) Is willing to accept the payment amount that was established for the HCPCS code under this section; and (ii) Obtains the participating CAP physician's prior approval. (2) Long-term substitution or addition of a CAP drug. (i) Proposed substitution of an NDC for a period of 2 weeks or longer. (ii) Proposed addition of one or more NDCs within a HCPCS code included in the CAP drug category specified by CMS or on the approved CAP vendor's approved CAP drug list. (iii) Proposed addition of— (A) One or more newly issued HCPCS codes; or (B) One of the following single indication orphan drug J codes or their updates: J0205, J0256, J9300, J1785, J2355, J3240, J7513, J9010, J9015, J9017, J9160, J9216. (iv) Beginning January 1, 2007, the proposed addition of a drug(s) that has not yet been assigned a HCPCS code, but for which a HCPCS code must be established. (v) On or after January 1, 2010, the proposed addition of drugs with similar therapeutic uses to drugs already supplied under the CAP by the approved CAP vendor(s). (3) Requesting the addition or substitution of CAP drug. (i) Specify the NDC(s) and the respective HCPCS code that is to be added or substituted. (ii) Address the rationale for the substitution or addition of the NDC(s) or the addition of the HCPCS code(s) as applicable; and (iii) Address the impact of the substitution of the NDC(s) or the addition of the NDC(s) or HCPCS code(s), or both on— (A) Patient and drug safety; (B) Drug waste; and (C) The potential for cost savings. (iv) In the case of additions requested under paragraph (f)(2)(v) of this section, address and document the need for such an expansion based on demand for the product(s). (4) Approval of a request(s). (i) Except as specified in paragraph (f)(4)(ii) of this section, an approved request is effective at the beginning of the next calendar quarter. (ii) Approved substitutions for request based on a drug shortage or other exigent circumstance may become effective immediately provided that— (A) CMS approves the immediate substitution; and (B) The approved CAP vendor's notifies its CAP participating physicians of the substitution immediately following CMS approval. (5) Payment for an approved drug change(s). (i) Substituted or added CAP drugs that are within a HCPCS code for which payment is computed under paragraph (c)(1) of this section is the single payment for that HCPCS code, as determined and updated in accordance with paragraph (c)(1) of this section; or (ii) Added CAP drugs that are not within a HCPCS code for which payment is computed under paragraph (c)(1) of this section is specified under paragraph (c)(2) of this section. (g) Deletion of drugs on an approved CAP vendor's CAP drug list. [70 FR 39094, July 6, 2005, as amended at 70 FR 70333, Nov. 21, 2005; 71 FR 9460, Feb. 24, 2006; 74 FR 62012, Nov. 25, 2009] § 414.908 Competitive acquisition program. (a) Participating CAP physician selection of an approved CAP vendor. (2) A participating CAP physician may select an approved CAP vendor outside the annual selection process or opt out of the CAP for the remainder of the annual selection period when— (i) The selected approved CAP vendor ceases participation in the CAP; (ii) The physician leaves a group practice participating in CAP; (iii) The participating CAP physician relocates to another competitive acquisition area; or (iv) The approved CAP vendor refuses to ship to the participating CAP physician because the conditions of § 414.914(i) have been met (if this subparagraph (a)(2)(iv) applies, the physician can withdraw from the CAP category for the remainder of the year immediately upon notice to CMS and the approved CAP vendor); or (v) Other exigent circumstances defined by CMS are present, including— (A) If, up to and including 60 days after the effective date of the physician's CAP election agreement, the participating CAP physician submits a written request to the designated carrier to terminate the CAP election agreement because CAP participation imposes a burden on the physician's practice. The written request must document the burden. The designated carrier will process the participating CAP physician's request and CMS will approve or deny the request under the dispute resolution process as specified under § 414.917 of this subpart. (B) If, more than 60 days after the effective date of the physician's CAP election agreement, the participating CAP physician submits a written request to the designated carrier to terminate the CAP election agreement because, based on a change in circumstances of which the participating CAP physician was not previously aware, CAP participation imposes a burden on the physician's practice. The written request must document the burden. The designated carrier will process the participating CAP physician's request and CMS will approve or deny the request under the dispute resolution process as specified under § 414.917 of this subpart. (3) The physician participating in the CAP— (i) Elects to use an approved CAP vendor for the drug category and area as set forth in § 414.908(b); (ii) Completes and signs the CAP election agreement; (iii) Submits a written prescription order to the approved CAP vendor with complete patient information for patients new to the approved CAP vendor or when information changes. Abbreviated information may be sent on all subsequent orders for a patient for which the approved CAP vendor has previously received complete information and that has no changes to the original information. Prescription orders may be initiated by telephone, with a follow-up written order provided within 8 hours for routine deliveries and immediately for emergency deliveries; (iv) Does not receive payment for the CAP drug; (v) Except where applicable State pharmacy law prohibits it, provides the following information to the approved CAP vendor to facilitate collection of applicable deductible and coinsurance as described in § 414.906(a)(3): (A) Date of order. (B) Beneficiary name, address, and phone number. (C) Physician identifying information: Name, practice location/shipping address, group practice information (if applicable), PIN, and UPIN. (D) Drug name. (E) Strength. (F) Quantity ordered. (G) Dose. (H) Frequency/instructions. (I) Anticipated date of administration. (J) Beneficiary Medicare information/Health insurance (HIC) number. (K) Supplementary insurance information (if applicable). (L) Medicaid information (if applicable). (M) Additional patient information: date of birth, allergies, height/weight, ICD-9-CM (if necessary). (vi) Agrees to accept the particular National Drug Codes (NDCs) supplied by the approved CAP vendor for the duration of the participating CAP physician's enrollment with the approved CAP vendor, subject to paragraphs (a)(3)(vii) and (a)(3)(xiv) of this section. By electing to participate with an approved CAP vendor, the participating CAP physician also agrees to accept the changes to the approved CAP vendor's CAP drug list that have been approved in accordance with § 414.906(f). (vii) Agrees to place routine orders for CAP drugs at the HCPCs level, except when medical necessity requires a particular formulation on the approved CAP vendor's CAP drug list. Medical necessity must be documented. When the conditions of this paragraph are met, the participating CAP physician may submit a prescription order to the approved CAP vendor that specifies the NDC. (viii) Notifies the approved CAP vendor when a drug is not administered or a smaller amount was administered than was originally ordered. The participating CAP physician and the approved CAP vendor agree on how to handle the unused CAP drug. If it is agreed that the participating CAP physician will maintain the CAP drug in his inventory for administration at a later date, the participating CAP physician submits a new prescription order at that time. This prescription order specifies that the CAP drug is being obtained from the participating CAP physician's CAP inventory and shipment should not occur; (ix) Maintains a separate electronic or paper inventory for each CAP drug obtained; (x) Agrees to file the Medicare claim within 30 calendar days of the date of drug administration. (xi) Agrees to submit documentation such as medical records or certification, as necessary, to support payment for a CAP drug; (xii) Agrees not to transport CAP drugs from one practice location or place of service to another location except in accordance with a written agreement between the participating CAP physician and the approved CAP vendor that requires that drugs are not subjected to conditions that will jeopardize their integrity, stability, and/or sterility while being transported. (xiii) Agrees to provide the CMS-developed CAP fact sheet to beneficiaries; and (xiv) May receive payment under the ASP system when medical necessity requires a certain brand or formulation of a drug that the approved CAP vendor has not been contracted to furnish under the CAP. (4) Physician group practices. If a physician group practice using a group billing number(s) elects to participate in the CAP, all physicians in the group are considered to be participating CAP physicians when using the group's billing number(s). (b) Program requirements. (i) Submission of the bid prices using the OMB-approved Vendor Application and Bid Form for CAP drugs within the category and competitive acquisition area that— (A) Places the vendor among the qualified bidders with the lowest five composite bids; and (B) Does not exceed the weighted payment amount established under section 1847A of the Act across all drugs in that category. (ii) Ability to ensure product integrity. (iii) Customer service/Grievance process. (iv) At least 3 years experience in furnishing Part B injectable drugs. (v) Financial performance and solvency. (vi) Record of integrity and the implementation of internal integrity measures. (vii) Internal financial controls. (viii) Acquisition of all CAP drugs directly from the manufacturer or from a distributor that has acquired the products directly from the manufacturer. (ix) Maintenance of appropriate licensure to supply CAP drugs in States in which they are supplying CAP drugs. (x) Cost-sharing assistance as described in § 414.914(g). (xi) Other factors as determined by CMS. (2) Approved CAP vendors must also meet the contract requirements under § 414.914. (c) Additional considerations. (1) Suspension or revocation by the Federal or State government of the entity's license for distribution of drugs, including controlled substances. (2) Exclusion of the entity under section 1128 of the Act from participation in Medicare or other Federal health care programs. These considerations are in addition to CMS' ability to terminate the approved CAP vendor for cause as specified in § 414.914(a). (3) Past violations or misconduct related to the pricing, marketing, distribution, or handling of drugs provided incident to a physician's service. (d) Multiple source drugs. (e) Multiple contracts for a category and area. [70 FR 39094, July 6, 2005, as amended at 70 FR 70333, Nov. 21, 2005; 72 FR 66402, Nov. 27, 2007; 74 FR 62013, Nov. 25, 2009] § 414.910 Bidding process. (a) Entities may bid to furnish CAP drugs in all competitive acquisition areas of the United States, or one or more specific competitive acquisition areas. (b) The amount of the bid for any CAP drug for a specific competitive acquisition area must be uniform for all portions of that competitive acquisition area. (c) A submitted bid price must include the following: (1) All costs related to the delivery of the drug to the participating CAP physician. (2) The costs of dispensing (including shipping) of the drug and management fees. The costs related to the administration of the drug or wastage, spillage, or spoilage may not be included. [70 FR 39095, July 6, 2005] § 414.912 Conflicts of interest. (a) Approved CAP vendors and applicants that bid to participate in the CAP are subject to the following: (1) The conflict of interest standards and requirements of the Federal Acquisition Regulation (FAR) organizational conflict of interest guidance, found under FAR subpart 9.5. (2) Those requirements and standards contained in each individual contract awarded to perform functions under section 1847B of the Act. (b) Post-award conflicts of interest. (1) State the need for management, employees, contractors, and agents to comply with the approved CAP vendor's code of conduct, and policies and procedures for conflicts of interest; and (2) State the approved CAP vendor's expectations for management, employees, contractors, and agents to comply with the approved CAP vendor's code of conduct, and policies and procedures for detecting, preventing, and resolving conflicts of interest. [70 FR 39094, July 6, 2005] § 414.914 Terms of contract. (a) The contract between CMS and the approved CAP vendor will be for a term of 3 years, unless terminated or suspended earlier as provided in this section or provided in § 414.917. The contract may be terminated— (1) By CMS for default if the approved CAP vendor violates any term of the contract; or (2) In the absence of a contract violation, by either CMS or the approved CAP vendor, if the terminating party notifies the other party by June 30 for an effective date of termination of December 31 of that year. (b) The contract will provide for a code of conduct for the approved CAP vendor that includes standards relating to conflicts of interest standards as set forth at § 414.912. (c) The approved CAP vendor will have and implement a compliance plan that contains policies and procedures that control program fraud, waste, and abuse, and consists of the following minimum elements: (1) Written policies, procedures, and standards of conduct articulating the organization's commitment to comply with all applicable Federal and State laws, regulations, and guidance, including, but not limited to, the Prescription Drug Marketing Act (PDMA), the physician self-referral (“Stark”) prohibition, the Anti-Kickback statute and the False Claims Act. (2) The designation of a compliance officer and compliance committee accountable to senior management. (3) Effective training and education of the compliance officer and organization employees, contractors, agents, and directors. (4) Enforcement of standards through well publicized disciplinary guidelines. (5) Procedures for effective internal monitoring and auditing. (6) Procedures for ensuring prompt responses to detected offenses and development of corrective action initiatives relating to the organization's contract as an approved CAP vendor. (i) If the approved CAP vendor discovers evidence of misconduct related to payment or delivery of drugs or biologicals under the contract, it will conduct a timely and reasonable inquiry into that conduct. (ii) The approved CAP vendor will conduct appropriate corrective actions including, but not limited to, repayment of overpayments and disciplinary actions against responsible individuals, in response to potential violations referenced at paragraph (c)(6)(i) of this section. (7) Procedures to voluntarily self-report potential fraud or misconduct related to the CAP to the appropriate government agency. (d) The contract must provide for disclosure of the approved CAP vendor's reasonable, net acquisition costs for a specified period of time, not to exceed quarterly. (e) The contract must provide for appropriate adjustments as described in § 414.906(c)(1). (f) Under the terms of the contract, the approved CAP vendor must also— (1) Have sufficient arrangements to acquire and deliver CAP drugs within the category in the competitive acquisition area specified by the contract; (2) Have arrangements in effect for shipment at least 5 weekdays each week of CAP drugs under the contract, including the ability to comply with the routine and emergency delivery timeframes defined in § 414.902; (3) Have procedures in place to address and resolve complaints of participating CAP physicians and individuals and inquiries regarding shipment of CAP drugs; (4) Have a grievance and appeals process for dispute resolution; (5) Respond within 2 business days to any inquiry, or sooner if the inquiry is related to drug quality; (6) Staff a toll-free telephone line from 8:30 a.m. or earlier and until 5 p.m. or later for all time zones served in the continental United States by the CAP vendor on business days (Monday through Friday excluding Federal holidays) to provide customer assistance, and establish reasonable hours of operation for Hawaii, Alaska, Puerto Rico, and the other U.S. territories; (7) Staff an emergency toll-free telephone line for weekend and evening access when the call center is closed, and determine what hours on Saturday and Sunday the call center is staffed and which hours a toll-free emergency line is activated; and (8) Include assistance for the disabled, the hearing impaired, and Spanish-speaking inquirers in all customer service operations. (9) Meet applicable licensure requirements in each State in which it supplies drugs under the CAP; (10) Be enrolled in Medicare as a participating supplier; (11) Comply with all applicable Federal and State laws, regulations and guidance related to the prevention of fraud and abuse; (12) Supply CAP drugs upon receipt of a prescription order to all participating CAP physicians who have selected the approved CAP vendor, except when the conditions of paragraph (h) of this section or § 414.916(b) of this subpart are met; (13) Provide direct notification to participating CAP physicians enrolled with them of updates to the approved CAP vendor's CAP drug list on a quarterly basis. Changes must be disseminated at least 30 days before the approved changes are due to take effect, unless immediate notification as described in § 414.906(f)(4) is required. The approved CAP vendor's entire CAP drug list must be disseminated at least once yearly; and approved CAP vendors must make a complete list that incorporates the most recent updates available to physicians on an ongoing basis. CMS posts on its web site the updated CAP drug lists for each approved CAP vendor. (14) Ensure that subcontractors who are involved in providing services under the approved CAP contractor's CAP contract meet all requirements and comply with all laws and regulations relating to the services they provide under the CAP program. Notwithstanding any relationship the CAP vendor may have with any subcontractor, the approved CAP vendor maintains ultimate responsibility for adhering to and otherwise fully complying with all terms and conditions of its contract with CMS; (15) Comply with product integrity and record keeping requirements including but not limited to drug acquisition, handling, storage, shipping, drug waste, and return processes; and (16) Comply with such other terms and conditions as CMS may specify in the CAP contract consistent with section 1847B of the Act. (g) Under the terms of the contract, the approved CAP vendor must provide assistance to beneficiaries experiencing financial difficulty in paying their cost-sharing amounts through any one or all of the following: (1) Referral to a bona fide and independent charitable organization. (2) Implementation of a reasonable payment plan. (3) A full or partial waiver of the cost-sharing amount after determining in good faith that the individual is in financial need or the failure of reasonable collection efforts, provided that the waiver meets all of the requirements of section 1128A(i)(6)(A) of the Act and the corresponding regulations at paragraph (1) of the definition of “Remuneration” in § 1003.101 of this title. The availability of waivers may not be advertised or be made as part of a solicitation. Approved CAP vendors must inform beneficiaries that they generally make available the categories of assistance described in paragraphs (g)(1), (g)(2), and (g)(3) of this section. In no event may the approved CAP vendor include or make any statements or representations that promise or guarantee that beneficiaries receive cost-sharing waivers. (h) The approved CAP vendor must verify drug administration prior to collection of any applicable cost sharing amount. (1) The approved CAP vendor documents, in writing, the following information necessary to verify drug administration: (i) Beneficiary name. (ii) Health insurance number. (iii) Expected date of administration. (iv) Actual date of administration. (v) Identity of the participating CAP physician. (vi) Prescription order number. (vii) Identity of the individuals who supply and receive the information. (viii) Dosage supplied. (ix) Dosage administered. (2) If the information is obtained verbally, the approved CAP vendor must also maintain the following information: (i) The identities of individuals who exchanged the information. (ii) The date and time that the information was obtained. (3) The approved CAP vendor must provide this information to CMS or the beneficiary upon request. (i) The approved CAP vendor must comply with the following procedures before it may refuse to make further shipments of CAP drugs to a participating CAP physician on behalf of a beneficiary: (1) Subsequent to receipt of payment by Medicare, or the verification of drug administration by the participating CAP physician, the approved CAP vendor must bill any applicable supplemental insurance policies. (2) An approved CAP vendor that has received payment from the designated carrier for CAP drugs that have not been administered must promptly refund payment for such drugs to the designated carrier and must refund any coinsurance and deductible collected from the beneficiary and his or her supplemental insurer. (3) At the time of billing the beneficiary, or the participating CAP physician's presentation of the bill on behalf of the approved CAP vendor, the approved CAP vendor must inform the beneficiary of any types of cost-sharing assistance that may be available consistent with the requirements of section 1128A(a)(5) of the Act and § 414.914(g). (4) If the beneficiary demonstrates a financial need, the approved CAP vendor must follow the conditions outlined in paragraph (g) of this section. (5) For purposes of paragraph (i) of this section delivery means postmark date, or the date the coinsurance bill or notice was presented to the beneficiary by the participating CAP physician on behalf of the approved CAP vendor. (i) Except as specified in paragraph (i)(5)(ii) of this section, if after 45 days from delivery of the approved CAP vendor's bill to the beneficiary, the beneficiary's cost-sharing obligation remains unpaid, the approved CAP vendor may refuse further shipments to the participating CAP physician for that beneficiary. (ii) If the beneficiary has requested cost-sharing assistance within 45 days of receiving delivery of the approved CAP vendor's bill, provisions of paragraphs (i)(6), (i)(7), or (i)(8) of this section, apply. (6) If the approved CAP vendor implements a reasonable payment plan, as specified in § 414.914(g)(2), the approved CAP vendor must continue to ship CAP drugs for the beneficiary, as long as the beneficiary remains in compliance with the payment plan and makes an initial payment under the plan within 15 days after the delivery of the approved CAP vendor's written notice to the beneficiary offering the payment plan. (7) If the approved CAP vendor has waived the cost-sharing obligations in accordance with section 1128A of the Act and § 414.914(g)(3), the approved CAP vendor may not refuse to ship drugs for that beneficiary. (8) If the approved CAP vendor refers the beneficiary to a bona fide and independent charity in accordance with § 414.914(g)(1), the approved CAP vendor may refuse to ship drugs if the past due balance is not paid 15 days after the date of delivery of the approved CAP vendor's written notice to the beneficiary containing the referral for cost-sharing assistance. (9) The approved CAP vendor may refuse to make further shipments to that participating CAP physician on behalf of the beneficiary for the lesser of the end of the calendar year or until the beneficiary's balance is paid in full. [70 FR 39096, July 6, 2005, as amended at 70 FR 70333, Nov. 21, 2005; 72 FR 66403, Nov. 27, 2007; 74 FR 62013, Nov. 25, 2009] § 414.916 Dispute resolution for vendors and beneficiaries. (a) General rule. (b) Dispute resolution. (i) Review the participating CAP physician's performance; and (ii) Potentially recommend to CMS that CMS suspend the participating CAP physician's CAP election agreement. (2) The designated carrier— (i) Gathers information from the local carrier, the participating CAP physician, the beneficiary, and the approved CAP vendor; and (ii) Makes a recommendation to CMS on whether the participating CAP physician has been filing his or her CAP drug administration claims in accordance with the requirements for physician participation in the CAP as set forth in § 414.908(a)(3). The recommendation will include numbered findings of fact. (3) CMS will review the recommendation of the designated carrier and gather relevant additional information from the participating CAP physician before deciding whether to suspend the participating CAP physician's CAP election agreement. A suspension commencing before October 1 will conclude on December 31 of the same year. A suspension commencing on or after October 1 will conclude on December 31 of the next year. (4) Upon notification from CMS of a participating CAP physician's suspension from the program, the approved CAP vendor must cease delivery of CAP drugs to the suspended participating CAP physician until the suspension has been lifted. (5) The participating CAP physician may appeal that suspension by requesting a reconsideration of CMS' decision. The reconsideration will address whether the participating CAP physician's denied claims and appeals were the result of the participating CAP physician's failure to participate in accordance with the requirements of § 414.908(a)(3). (c) Reconsideration Right to a reconsideration. (2) Eligibility for reconsideration. (3) Manner and timing of request for reconsideration. (4) Content of request. (i) The findings or issues with which the participating CAP physician disagrees; (ii) The reasons for the disagreement; (iii) A recital of the facts and law supporting the participating CAP physician's position; (iv) Any supporting documentation; and (v) Any supporting statements from approved CAP vendors, local carriers, or beneficiaries. (5) Withdrawal of request for reconsideration. (6) Discretionary informal hearing. (i) Is conducted by a hearing officer appointed by the director of the CMS Center for Medicare Management or his or her designee; and (ii) Provides the participating CAP physician the opportunity to present, by telephone or in person, evidence to rebut CMS' decision to suspend or terminate a participating CAP physician's CAP election agreement. (7) Informal hearing procedures. (ii) The informal reconsideration hearing will be conducted in accordance with the following procedures: (A) The hearing is open to CMS and the participating CAP physician requesting the reconsideration, including— ( 1 ( 2 ( 3 ( 4 ( 5 (B) The hearing is conducted by the hearing officer who receives relevant testimony; (C) Testimony and other evidence may be accepted by the hearing officer even though it would be inadmissible under the rules of evidence applied in Federal courts; (D) Either party may call witnesses from among those individuals specified in paragraph (c)(7)(ii)(A) of this section; and (E) The hearing officer does not have the authority to compel by subpoena the production of witnesses, papers, or other evidence. (8) Hearing officer's findings. (ii) The written report of the hearing officer includes separate numbered findings of fact and the legal conclusions of the hearing officer. (9) Final reconsideration determination. (ii) The CMS official may accept, reject, or modify the hearing officer's findings. (iii) If the CMS official reviews the hearing officer's decision, the CMS official issues a final reconsideration determination to the participating CAP physician on the basis of the hearing officer's findings and recommendations and other relevant information. (iv) The reconsideration determination of the CMS official is final. If the final decision is unfavorable to the participating CAP physician, then the participating CAP physician's CAP election agreement is terminated. (d) The approved CAP vendor may not charge the beneficiary for the full drug coinsurance amount if the designated contractor did not pay the approved CAP vendor in full, unless a properly executed advance beneficiary notice is in place. When a beneficiary receives an inappropriate coinsurance bill, the beneficiary may participate in the approved CAP vendor's grievance process to request correction of the approved CAP vendor's file. If the beneficiary is dissatisfied with the result of the approved CAP vendor's grievance process, the beneficiary may request intervention from the designated carrier. This is in addition to, rather than in place of, any other beneficiary appeal rights. The designated carrier will first investigate the facts and then facilitate correction to the appropriate claim record and beneficiary file. [70 FR 39097, July 6, 2005, as amended at 72 FR 66403, Nov. 27, 2007; 74 FR 62013, Nov. 25, 2009] § 414.917 Dispute resolution and process for suspension or termination of approved CAP contract and termination of physician participation under exigent circumstances. (a) General rule. (b) Dispute resolution. (i) Review the approved CAP vendor's performance; and (ii) Potentially recommend termination of the approved CAP vendor's CAP contract. (2) Responsibility of the designated carrier. (i) Gathers information from the local carrier, the participating CAP physician, the beneficiary, and the approved CAP vendor; and (ii) Makes a recommendation to CMS on whether the approved CAP vendor has been meeting the service and quality obligations of its CAP contract. This recommendation will include numbered findings of fact. (3) CMS will review the recommendation of the designated carrier and, gather relevant additional information from the approved CAP vendor, the participating CAP physician, the local carrier, and the beneficiary before deciding whether to terminate the approved CAP vendor's CAP contract. (4) The approved CAP vendor may appeal that termination by requesting a reconsideration. A determination must be made as to whether the approved CAP vendor has been meeting the service and quality obligations of its CAP contract. The approved CAP vendor's contract will remain suspended during the reconsideration process. (c) Reconsideration Right to reconsideration. (2) Eligibility for reconsideration. (3) Manner and timing of request for reconsideration. (4) Content of request. (i) The findings or issues with which the approved CAP vendor disagrees; (ii) The reasons for the disagreement; (iii) A recital of the facts and law supporting the approved CAP vendor's position; (iv) Any supporting documentation; and (v) Any supporting statements from participating CAP physicians, the local carrier, or beneficiaries. (5) Withdrawal of request for reconsideration. (6) Discretionary informal hearing. (i) Is conducted by a hearing officer appointed by the Director of the CMS Center for Medicare Management or his or her designee; and (ii) Provides the approved CAP vendor the opportunity to present, by telephone or in person, evidence to rebut CMS' decision to suspend or terminate the approved CAP vendor's CAP contract. (7) Informal hearing procedures. (ii) The informal reconsideration hearing will be conducted in accordance with the following procedures: (A) The hearing is open to CMS and the approved CAP vendor requesting the reconsideration, including— ( 1 ( 2 ( 3 ( 4 ( 5 (B) The hearing will be conducted by the hearing officer, who will receive relevant testimony; (C) Testimony and other evidence may be accepted by the hearing officer even though it would be inadmissible under the rules of evidence applied in Federal courts; (D) Either party may call witnesses from among those individuals specified in the paragraph (c)(7)(ii)(A) of this section; and (E) The hearing officer does not have the authority to compel by subpoena the production of witnesses, papers, or other evidence. (8) Hearing officer's findings. (ii) The written report of the hearing officer will include separate numbered findings of fact and the legal conclusions of the hearing officer. (9) Final reconsideration determination. (ii) The CMS official may accept, reject, or modify the hearing officer's findings. (iii) If the CMS official reviews the hearing officer's decision, the CMS official will issue a final reconsideration determination to the approved CAP vendor on the basis of the hearing officer's findings and recommendations and other relevant information. (iv) The reconsideration determination of the CMS official is final. (d) CAP participating physicians' exigent circumstances provision. (1) The designated carrier must— (i) Determine whether a request to terminate CAP participation was related to approved CAP vendor service, and if so, forward the issue to the approved CAP vendor's grievance process within 1 business day of the receipt of the request; or (ii) Continue to investigate, consistent with § 414.916(b)(2) of this chapter, and within 2 business days of receipt, do any of the following: (A) Request a single, 2-business day extension. No later than the end of any 2-business day extension, the designated carrier must make findings and a recommendation as provided in subparagraph (B) or (C). (B) Submit a recommendation and relevant findings to CMS that the requesting participating CAP physician be permitted to terminate his or her participation in the CAP. (C) Submit a recommendation and relevant findings to CMS that the requesting participating CAP physician not be permitted to terminate his or her participation in the CAP. (ii) In the case of a request made under § 414.908(a)(2)(v)(B), the designated carrier also shall include in its recommendation its finding with respect to whether the request is based on a change in circumstances of which the participating CAP physician was previously unaware. (2) CMS will consider the carrier's findings and recommendation and may also make its own findings. As a result, CMS will— (i) Approve or deny the request to terminate participation in the CAP within 2 business days of receipt of the recommendation. (ii) Communicate the decision to the appropriate Medicare contractors and the participating CAP physician. (3) A denial of the participating CAP physician's request to terminate participation in the CAP must include written notification of the right to request reconsideration under § 414.916(c). (4) Upon termination of participation in the CAP a physician must— (i) Continue to submit claims for drugs supplied and administered under the CAP prior to the effective date of the physician's termination from the CAP consistent with § 414.908(a) until all such claims are timely submitted. (ii) Return any unused CAP drugs that had not been administered to the beneficiary prior to the effective date of the physician's termination from the CAP to the approved CAP vendor consistent with applicable law and regulation and any agreement with the approved CAP vendor. (iii) Cooperate in any post-payment review activities on claims submitted under the CAP, as required under section 1847B(a)(3) of the Act. (5) An approved CAP vendor that has billed and been paid for CAP drugs that have not been administered must refund any payments made by CMS or the beneficiary and his or her supplemental insurer in accordance with § 414.914(h)(3)(i)(2) of this chapter. [70 FR 39098, July 6, 2005, as amended at 72 FR 66403, Nov. 27, 2007; 74 FR 62013, Nov. 25, 2009] Editorial Note: At 72 FR 66222, November 27, 2007, § 414.917 was amended by adding paragraph (d), which contained two paragraphs labeled (d)(1)(ii). § 414.918 Assignment. Payment for a CAP drug may be made only on an assignment-related basis. [70 FR 39099, July 6, 2005] § 414.920 Judicial review. The following areas under the CAP are not subject to administrative or judicial review: (a) The establishment of payment amounts. (b) The awarding of vendor contracts. (c) The establishment of competitive acquisition areas. (d) The selection of CAP drugs. (e) The bidding structure. (f) The number of vendors selected. [70 FR 39099, July 6, 2005] § 414.930 Compendia for determination of medically-accepted indications for off-label uses of drugs and biologicals in an anti-cancer chemotherapeutic regimen. (a) Definitions. Compendium (i) Includes a summary of the pharmacologic characteristics of each drug or biological and may include information on dosage, as well as recommended or endorsed uses in specific diseases. (ii) Is indexed by drug or biological. (iii) Has a publicly transparent process for evaluating therapies and for identifying potential conflicts of interests. Publicly transparent process for evaluating therapies (i) The internal or external request for listing of a therapy recommendation including criteria used to evaluate the request. (ii) A listing of all the evidentiary materials reviewed or considered by the compendium pursuant to the request. (iii) A listing of all individuals who have substantively participated in the review or disposition of the request. (iv) Minutes and voting records of meetings for the review and disposition of the request. Publicly transparent process for identifying potential conflicts of interests (i) Direct or indirect financial relationships that exist between individuals or the spouse or minor child of individuals who have substantively participated in the development or disposition of compendia recommendations and the manufacturer or seller of the drug or biological being reviewed by the compendium. This may include, for example, compensation arrangements such as salary, grant, contract, or collaboration agreements between individuals or the spouse or minor child of individuals who have substantively participated in the review and disposition of the request and the manufacturer or seller of the drug or biological being reviewed by the compendium. (ii) Ownership or investment interests between individuals or the spouse or minor child of individuals who have substantively participated in the development or disposition of compendia recommendations and the manufacturer or seller of the drug or biological being reviewed by the compendium. (b) Process for listing compendia for determining medically-accepted uses of drugs and biologicals in anti-cancer treatment. (i) Receives formal written requests for changes to the list of compendia during a 30 day window beginning January 15 each year. (ii) Publishes a listing of the timely, complete requests by March 15th and solicits public comment on the requests for 30 days. The listing identifies the requestor and the requested action. (iii) Considers a compendium's attainment of the MedCAC (Medicare Evidence Development and Coverage Advisory Committee, previously known as the MCAC—Medicare Coverage Advisory Committee) recommended desirable characteristics of compendia (including explicit listing and recommendations) in reviewing requests. CMS may consider additional reasonable factors. (iv) Considers a compendium's grading of evidence used in making recommendations regarding off-label uses and the process by which the compendium grades the evidence. (v) Considers whether the publication that is the subject of the request meets the definition of a compendium in this section. (vi) Publishes its decision no later than 90 days after the close of the public comment period. (2) Exception. (c) Written request for review. (i) The full name and contact information of the requestor. (ii) The full identification of the compendium that is the subject of the request, including name, publisher, edition if applicable, date of publication, and any other information needed for the accurate and precise identification of the specific compendium. (iii) A complete written copy of the compendium that is the subject of the request. (iv) The specific action that is requested of CMS. (v) Materials that the requestor must submit for CMS review in support of the requested action. (vi) A single compendium as its subject. (d) CMS may at its discretion combine and consider multiple requests that refer to the same compendium. (e) For the purposes of this section, publication by CMS may be accomplished by posting on the CMS Web site. [72 FR 66404, Nov. 27, 2007, as amended at 74 FR 62013, Nov. 25, 2009] § 414.940 Refund for certain discarded single-dose container or single-use package drugs. (a) Provision of information to manufacturers In general. (i) Information on the total number of billing units of the billing and payment code of such drug, if any, that were discarded during such quarter, as determined by the JW modifier (or any successor modifier that includes the same data). (ii) The refund amount that the manufacturer is liable for pursuant to paragraph (a)(3) of this section. (iii) Reports will include information in paragraphs (a)(1)(i) and (ii) of this section for new refund quarters and updated refund quarters (as defined at § 414.902). (iv) For purposes of this section, the term billing unit means the identifiable quantity associated with a billing and payment code, as established by CMS. (2) Exclusion of units of packaged drugs. (3) Report Timing. (b) Manufacturer requirement. (1) Refund amounts for which the manufacturer is liable, pursuant to this paragraph, must be paid by December 31 of the year in which the report described in paragraph (a) of this section is sent, except that refund amounts for which the manufacturer is liable, pursuant to this paragraph, for amounts in the initial report for calendar quarters in 2023 must be paid no later than February 28, 2025. (2) In the case that a disputed report results in a refund amount due, refund amounts that the manufacturer is liable for pursuant to this paragraph shall be paid no later than the dates specified in paragraph (b)(1) of this section or 30 days following the resolution of the dispute, whichever is later. (3) Amounts paid as refunds pursuant to this paragraph shall be deposited into the Federal Supplementary Medical Insurance Trust Fund established under section 1841 of the Act. (c) Refund amount. (1) A new refund quarter (as defined at § 414.902) beginning on or after January 1, 2023, an amount equal to the estimated amount (if any) by which: (i) The product of the total number of units of the billing and payment code for such drug that were discarded during such new refund quarter; and the amount of payment determined for such drug or biological under section 1847A(b)(1)(B) or (C) of the Act, as applicable, for such new refund quarter; (ii) Exceeds an amount equal to the applicable percentage of the estimated total allowed charges for such drug for the new refund quarter. (2) The refund amount owed by a manufacturer for an updated refund quarter (as defined at § 414.902) beginning on or after January 1, 2023, an amount equal to the estimated amount (if any) by which: (i) The product of the total number of units of the billing and payment code for such drug that were discarded during such updated refund quarter; and the amount of payment determined for such drug or biological under section 1847A(b)(1)(B) or (C) of the Act, as applicable, for such quarter. (ii) Exceeds the difference of: (A) An amount equal to the applicable percentage of the estimated total allowed charges for such a drug during the updated refund quarter; and (B) The refund amount already paid for such refundable drug for such quarter. (3) Negative refund amount for an updated refund quarter. If the refund amount described in paragraph (c)(2) of this section is negative, the amount will be netted from refunds owed for other updated and new refund quarters included in the same report as such updated refund quarter. (4) Exception when there are multiple manufacturers. If there is more than one manufacturer of a refundable single-dose container or single-use package drug for a quarter, the refund amount for which a manufacturer is liable is an amount equal to the estimated amount (if any) by which— (i) The product of the amount calculated in paragraph (c)(1) of this section and the percentage of billing unit sales (of the applicable billing and payment code attributed to the National Drug Code; exceeds: (ii) The product of the amount in paragraph (c)(2) of this section and percentage of billing unit sales of the applicable billing and payment code attributed to the National Drug Code. (iii) The number of billing unit sales for each NDC is the reported number of NDCs sold (as submitted in the ASP report to CMS each quarter) multiplied by the billing units per package for such NDC. (d) Applicable percentage. (1) 10 percent, unless specified otherwise in this section. (2) 35 percent for a drug that is reconstituted with a hydrogel and has variable dosing based on patient-specific characteristics. (3) 90 percent for a drug with a low volume dose (as defined at § 414.902) contained within 0.1 mL or less. (4) 45 percent for a drug with a low volume dose (as defined in § 414.902) contained within 0.11 mL up to 0.4 mL. (5) 26 percent for a drug designated an orphan drug under section 526 of the Federal Food, Drug, and Cosmetic Act for a rare disease or condition (or diseases or conditions) and approved by the FDA only for one or more indications within such designated rare disease or condition (or diseases or conditions) and is furnished to fewer than 100 unique beneficiaries per calendar year. A drug is furnished to fewer than 100 unique beneficiaries per calendar year when one of the following two conditions is met: (i) The number of unique beneficiaries to whom the drug is furnished is less than 100 during the calendar year in which the refund quarter occurs; or (ii) Either: (A) In the case of a drug for which 3 or more years of data is available, the average of unique beneficiaries per year to whom the drug is furnished during the calendar year in which the refund quarter occurs and the 2 previous calendar years is less than 100; or (B) In the case of a drug for which at least 2 but less than 3 years of data is available, the average of unique beneficiaries per year to whom the drug is furnished during the calendar year in which the refund quarter occurs and the previous calendar year is less than 100. (e) Application process for increased applicable percentage. (1) Application. (i) A written request that a drug be considered for an increased applicable percentage based on its unique circumstances; (ii) FDA-approved labeling for the drug, or, if the drug is not approved by the February 1 application deadline described in paragraph (e)(2) of this section, documentation of FDA acceptance of the application for review; (iii) Justification for the consideration of an increased applicable percentage based on such unique circumstances; and (iv) Justification for the requested applicable percentage. (2) Application timeline. (3) Application processing. (f) Dispute resolution. (1) Error report information. (i) Manufacturer name and address; (ii) The name, telephone number, and email address of one or more employees or representatives of the manufacturer. (iii) For a mathematical calculation error, the specific calculation element(s) that the manufacturer disputes and its proposed corrected calculation; (iv) For any other asserted error, an explanation of the nature of the error, how the error affects the refund calculation, an explanation of why the manufacturer believes that an error occurred, the proposed correction to the error, and an explanation of why CMS should use the proposed corrected data. (2) Form, manner, and timing of submission. (g) Enforcement Manufacturer audit (2) Civil money penalty. (i) The amount that the manufacturer would have paid under such paragraph with respect to such drug for such quarter; and (ii) 25 percent of such amount. [87 FR 70226, Nov. 18, 2022, as amended at 88 FR 15920, Mar. 15, 2023; 88 FR 79532, Nov. 16, 2023] Subpart L—Supplying and Dispensing Fees § 414.1000 Purpose. This subpart implements section 1842(o)(2) and section 1842(o)(6) of the Act, as added by section 303(e)(2) of the MMA, by specifying a supplying fee for drugs and biologicals covered under Part B of Title XVIII of the Act that are described in sections 1861(s)(2)(J), 1861(s)(2)(Q), and 1861(s)(2)(T) of the Act. [69 FR 66425, Nov. 15, 2004] § 414.1001 Basis of payment. (a) Supplying fees. (1) A supplying fee of $24 is paid to a pharmacy (no more often than once every 30 days) for the first prescription of drugs and biologicals described in sections 1861(s)(2)(J), 1861(s)(2)(Q), and 1861(s)(2)(T) of the Act, that the pharmacy provided to a beneficiary, except as provided in paragraph (a)(2) of this section. (2) A supplying fee of $50 is paid to pharmacy for the initial supplied prescription of drugs and biologicals described in section 1861(s)(2)(J) of the Act, that the pharmacy provided to a patient during the first 30-day period following a transplant. (3) A supplying fee of $16 is paid to a pharmacy (no more often than once every 30 days) for each prescription following the first prescription (as specified in paragraphs (a)(1) and (2) of this section) of drugs and biologicals described in sections 1861(s)(2)(J), 1861(s)(2)(Q), and 1861(s)(2)(T) of the Act, that the pharmacy provided to a beneficiary. (4) A separate supplying fee is paid to a pharmacy for each prescription of drugs and biologicals described in sections 1861(s)(2)(J), 1861(s)(2)(Q), and 1861(s)(2)(T) of the Act. (b) 30-day dispensing fees. (2) Except for supplied inhalation drugs that meet criteria described in paragraph (b)(1) of this section, a dispensing fee of $33 is paid for each dispensed 30-day supply of inhalation drugs furnished through durable medical equipment covered under section 1861(n) of the Act, regardless of the number of partial shipments of that 30-day supply. (c) 90-day dispensing fee. [70 FR 70334, Nov. 21, 2005, as amended at 89 FR 98560, Dec. 9, 2024] Subpart M—Payment for Comprehensive Outpatient Rehabilitation Facility (CORF) Services Source: 72 FR 66404, Nov. 27, 2007, unless otherwise noted. § 414.1100 Basis and scope. This subpart implements sections 1834(k)(1) and (k)(3) of the Act by specifying the payment methodology for comprehensive outpatient rehabilitation facility services covered under Part B of Title XVIII of the Act that are described at section 1861(cc)(1) of the Act. § 414.1105 Payment for Comprehensive Outpatient Rehabilitation Facility (CORF) services. (a) Payment under the physician fee schedule. (1) The actual charge for the item or service; or (2) The nonfacility amount determined under the physician fee schedule established under section 1848(b) of the Act for the item or service. (b) Payment for physician services. (c) Payment for supplies and durable medical equipment, prosthetic and orthotic devices, and drugs and biologicals. (1) The actual charge for the service provided that payment for such item is not included in the payment amount for other CORF services paid under paragraphs (a) or (d); or (2) The amount determined under the DMEPOS fee schedule established under part 414 subparts D and F for the item or the single payment amount established under the DMEPOS competitive bidding program provided that payment for such item is not included in the payment amount for other CORF services paid under paragraphs (a) or (d). (d) Payment for drugs and biologicals. (1) The actual charge for the service provided that payment for such item is not included in the payment amount for other CORF services paid under paragraphs (a) or (c); or (2) The amount determined using the same methodology for drugs (as defined in § 414.704 of this chapter) described in section 1842(o)(1) of the Act provided that payment for such drug (e) Payment for CORF services when no fee schedule amount for the service. (i) The actual charge for the service provided that payment for such item or service is not included in the payment amount for other CORF services paid under paragraphs (a), (c), or (d) of this section. (ii) The amount determined under the fee schedule established for a comparable service as specified by the Secretary provided that payment for such item or service is not included in the payment amount for other CORF services paid under paragraphs (a), (c), or (d) of this section. Subpart N—Value-Based Payment Modifier Under the Physician Fee Schedule Source: 77 FR 69368, Nov. 16, 2012, unless otherwise noted. § 414.1200 Basis and scope. (a) Basis. (b) Scope. (1) The application of the value-based payment modifier. (2) Performance and payment adjustment periods. (3) Reporting mechanisms for the value-based payment modifier. (4) Alignment of PQRS quality of care measures with the quality measures for the value-based payment modifier. (5) Additional measures for groups and solo practitioners. (6) Cost measures. (7) Attribution for quality of care and cost measures. (8) Scoring methods for the value-based payment modifier. (9) Benchmarks for quality of care measures. (10) Benchmarks for cost measures. (11) Composite scores. (12) Reliability of measures. (13) Payment adjustments. (14) Value-based payment modifier quality-tiering scoring methodology. (15) Limitation of review. (16) Inquiry process. [77 FR 69368, Nov. 16, 2012, as amended at 79 FR 68005, Nov. 13, 2014] § 414.1205 Definitions. As used in this subpart, unless otherwise indicated— Accountable care organization Certified registered nurse anesthetist (CRNA) Critical access hospital Electronic health record Eligible professional Federally Qualified Health Center Group of physicians (Group) Performance period Performance rate Physician Physician assistant (PA), nurse practitioner (NP), and clinical nurse specialist (CNS) Physician Fee Schedule Physician Quality Reporting System Risk score Solo practitioner Taxpayer Identification Number Value-based payment modifier [77 FR 69368, Nov. 16, 2012, as amended at 79 FR 68005, Nov. 13, 2014; 80 FR 71382, Nov. 16, 2015] § 414.1210 Application of the value-based payment modifier. (a) The value-based payment modifier is applicable: (1) For the CY 2015 payment adjustment period, to physicians in groups with 100 or more eligible professionals based on the performance period described at § 414.1215(a). (2) For the CY 2016 payment adjustment period, to physicians in groups with 10 or more eligible professionals based on the performance period described at § 414.1215(b). (3) For the CY 2017 payment adjustment period and each subsequent calendar year payment adjustment period, to physicians in groups with 2 or more eligible professionals and to physicians who are solo practitioners based on the performance period for the payment adjustment period as described at § 414.1215. (4) For the CY 2018 payment adjustment period, to nonphysician eligible professionals who are physician assistants, nurse practitioners, clinical nurse specialists, and certified registered nurse anesthetists in groups with 2 or more eligible professionals and to physician assistants, nurse practitioners, clinical nurse specialists, and certified registered nurse anesthetists who are solo practitioners based on the performance period for the payment adjustment period as described at § 414.1215. (b) Exceptions. (2) Application of the value-based payment modifier to participants in the Shared Savings Program. (i) For the CY 2017 payment adjustment period and each subsequent calendar year payment adjustment period, the value-based payment modifier is applicable to physicians in groups with 2 or more eligible professionals and to physicians who are solo practitioners that participate in an ACO under the Shared Savings Program during the performance period for the payment adjustment period as described at § 414.1215. The value-based payment modifier for a group or solo practitioner that participates in an ACO under the Shared Savings Program during the performance period is determined based on paragraphs (b)(2)(i)(A) through (D) of this section. (A) The cost composite is classified as “average” under § 414.1275(b). (B) For groups and solo practitioners that participate in a Shared Savings Program ACO that successfully reports quality data as required by the Shared Savings Program under § 425.504 of this chapter, the quality composite score is calculated under § 414.1260(a) using quality data reported by the ACO for the performance period through the ACO GPRO Web interface as required under § 425.504(a)(1) of this chapter or another mechanism specified by CMS and the ACO all-cause readmission measure. Groups and solo practitioners that participate in two or more ACOs during the applicable performance period receive the quality composite score of the ACO that has the highest numerical quality composite score. For the CY 2018 payment adjustment period, the CAHPS for ACOs survey also will be included in the quality composite score. For the CY 2017 and 2018 payment adjustment periods, for groups and solo practitioners who participate in a Shared Savings Program ACO that does not successfully report quality data as required by the Shared Savings Program under § 425.504 and who meet the requirements to avoid the PQRS payment adjustment for CY 2018 by reporting to the PQRS outside the ACO, the quality composite is classified as “average” under § 414.1275(b). (C) For the CY 2017 payment adjustment period, the value-based payment modifier adjustment will be equal to the amount determined under § 414.1275 for the payment adjustment period, except that if the ACO (or groups and solo practitioners that participate in the ACO) does not successfully report quality data as described in paragraph (b)(2)(i)(B) of this section for the performance period, such adjustment will be equal to -4% for groups of physicians with 10 or more eligible professionals and equal to -2% for groups of physicians with two to nine eligible professionals and for physician solo practitioners. If the ACO has an assigned beneficiary population during the performance period with an average risk score in the top 25 percent of the risk scores of beneficiaries nationwide, and a group of physician or physician solo practitioner that participates in the ACO during the performance period is classified as high quality/average cost under quality-tiering for the CY 2017 payment adjustment period, the group or solo practitioner receives an upward adjustment of +3 × (rather than +2 ×) if the group has 10 or more eligible professionals or +2 × (rather than +1 ×) for a solo practitioner or the group has two to nine eligible professionals. (D) For the CY 2018 payment adjustment period, the value-based payment modifier adjustment will be equal to the amount determined under § 414.1275 for the payment adjustment period, except that if the ACO (or groups and solo practitioners that participate in the ACO) does not successfully report quality data as described in paragraph (b)(2)(i)(B) of this section for the performance period, such adjustment will be equal to the downward payment adjustment amounts described at § 414.1270(d)(1). If the ACO has an assigned beneficiary population during the performance period with an average risk score in the top 25 percent of the risk scores of beneficiaries nationwide, and a group or solo practitioner that participates in the ACO during the performance period is classified as high quality/average cost under quality-tiering for the CY 2018 payment adjustment period, the group or solo practitioner receives an upward adjustment of +3 × (rather than +2 ×) if the group of physicians has 10 or more eligible professionals, +2 × (rather than +1 ×) for a physician solo practitioner or if the group of physicians has two to nine eligible professionals, or +2 × (rather than +1 ×) for a solo practitioner who is a nonphysician eligible professional or if the group consists of nonphysician eligible professionals. (E) For the CY 2017 payment adjustment period and each subsequent calendar year payment adjustment period, the value-based payment modifier for groups and solo practitioners that participate in an ACO under the Shared Savings Program during the applicable performance period is determined as described under paragraph (b)(2) of this section, regardless of whether any eligible professionals in the group or the solo practitioner also participate in an Innovation Center model during the performance period. (F) For groups and solo practitioners that participate in a Shared Savings Program ACO that successfully reports quality data as required by the Shared Savings Program under § 425.504 of this chapter, the same value-based payment modifier adjustment will be applied in the payment adjustment period to all groups based on size as specified under § 414.1275 and solo practitioners that participated in the ACO during the performance period. (ii) For the CY 2018 payment adjustment period and each subsequent calendar year payment adjustment period, the value-based payment modifier is applicable to nonphysician eligible professionals in groups with 2 or more eligible professionals and to nonphysician eligible professionals who are solo practitioners that participate in an ACO under the Shared Savings Program during the performance period for the payment adjustment period as described at § 414.1215. The value-based payment modifier for nonphysician eligible professionals is determined in the same manner as for physicians as described under paragraphs (b)(2)(i)(A) through (D) of this section. (3) Application of the value-based payment modifier to participants in the Pioneer ACO Model and the Comprehensive Primary Care Initiative (ii) For the CY 2018 payment adjustment period, the value-based payment modifier is waived under section 1115A(d)(1) of the Act for physicians and nonphysician eligible professionals in groups with 2 or more eligible professionals and for physicians and nonphysician eligible professionals who are solo practitioners that participate in the Pioneer ACO Model or the Comprehensive Primary Care (CPC) Initiative during the performance period for the payment adjustment period as described at § 414.1215. (iii) For purposes of the value-based payment modifier, a group or solo practitioner is considered to be participating in the Pioneer ACO Model or CPC Initiative if at least one eligible professional billing under the TIN in the performance period for the payment adjustment period as described at § 414.1215 is participating in the Pioneer ACO Model or CPC Initiative in the performance period. (4) Application of the value-based payment modifier to participants in other similar Innovation Center models (ii) For the CY 2018 payment adjustment period, the value-based payment modifier is waived under section 1115A(d)(1) of the Act for physicians and nonphysician eligible professionals in groups with 2 or more eligible professionals and for physicians and nonphysician eligible professionals who are solo practitioners that participate in other similar Innovation Center models during the performance period for the payment adjustment period as described at § 414.1215. (iii) For purposes of the value-based payment modifier, a group or solo practitioner is considered to be participating in a similar Innovation Center model if at least one eligible professional billing under the TIN in the performance period for the payment adjustment period as described at § 414.1215 is participating in the similar model in the performance period. (c) Group size and composition determination (2) Beginning with the CY 2016 payment adjustment period, the size of a group during the applicable performance period will be determined by the lower number of eligible professionals as indicated by the PECOS-generated list or claims analysis. (3) For the CY 2018 payment adjustment period, the composition of a group during the applicable performance period will be determined based on whether the group includes physicians, physician assistants, nurse practitioners, clinical nurse specialists, certified registered nurse anesthetists, and/or other types of nonphysician eligible professionals as indicated by the PECOS-generated list or claims analysis. [77 FR 69368, Nov. 16, 2012, as amended at 78 FR 74820, Dec. 10, 2013; 79 FR 68005, Nov. 13, 2014; 80 FR 71382, Nov. 16, 2015; 81 FR 80555, Nov. 15, 2016] § 414.1215 Performance and payment adjustment periods for the value-based payment modifier. (a) The performance period is calendar year 2013 for value-based payment modifier adjustments made in the calendar year 2015 payment adjustment period. (b) The performance period is calendar year 2014 for value-based payment modifier adjustments made in the calendar year 2016 payment adjustment period. (c) The performance period is calendar year 2015 for value-based payment modifier adjustments made in the calendar year 2017 payment adjustment period. (d) The performance period is calendar year 2016 for value-based payment modifier adjustments made in the calendar year 2018 payment adjustment period. [77 FR 69368, Nov. 16, 2012, as amended at 78 FR 74820, Dec. 10, 2013; 80 FR 71383, Nov. 16, 2015] § 414.1220 Reporting mechanisms for the value-based payment modifier. Solo practitioners and groups subject to the value-based payment modifier (or individual eligible professionals within such groups) may submit data on quality measures as specified under the Physician Quality Reporting System using the reporting mechanisms for which they are eligible. [78 FR 74820, Dec. 10, 2013, as amended at 79 FR 68006, Nov. 13, 2014] § 414.1225 Alignment of Physician Quality Reporting System quality measures and quality measures for the value-based payment modifier. All of the quality measures for which solo practitioners and groups (or individual eligible professionals within such groups) are eligible to report under the Physician Quality Reporting System in a given calendar year are used to calculate the value-based payment modifier for the applicable payment adjustment period, as defined in § 414.1215, to the extent a solo practitioner or a group (or individual eligible professionals within such group) submit data on such measures. [79 FR 68006, Dec. 13, 2014] § 414.1230 Additional measures for groups and solo practitioners. The value-based payment modifier includes the following additional quality measures (outcome measures) as applicable for all groups and solo practitioners subject to the value-based payment modifier: (a) A composite of rates of potentially preventable hospital admissions for heart failure, chronic obstructive pulmonary disease, and diabetes. The rate of potentially preventable hospital admissions for diabetes is a composite measure of uncontrolled diabetes, short term diabetes complications, long term diabetes complications and lower extremity amputation for diabetes. (b) A composite of rates of potentially preventable hospital admissions for dehydration, urinary tract infections, and bacterial pneumonia. (c) Rates of an all-cause hospital readmissions measure, except for groups with between two to nine eligible professionals and solo practitioners starting with the CY 2017 payment adjustment period. [77 FR 69368, Nov. 16, 2012, as amended at 79 FR 68007, Nov. 13, 2014; 80 FR 71383, Nov. 16, 2015] § 414.1235 Cost measures. (a) Included measures. (1) Total per capita costs for all attributed beneficiaries. (2) Total per capita costs for all attributed beneficiaries with diabetes. (3) Total per capita costs for all attributed beneficiaries with coronary artery disease. (4) Total per capita costs for all attributed beneficiaries with chronic obstructive pulmonary disease. (5) Total per capita costs for all attributed beneficiaries with heart failure. (6) Medicare Spending per Beneficiary associated with an acute inpatient hospitalization. (b) Included payments. (c) Cost measure adjustments. (2) The CMS-HCC model (and adjustments for ESRD status) is used to adjust standardized payments for the measures listed at paragraphs (a)(1) through (5) of this section. (3) The beneficiary's age and severity of illness are used to adjust the Medicare Spending per Beneficiary measure as specified in paragraph (a)(6) of this section. (4) Beginning with the CY 2016 payment adjustment period, the cost measures of a group and solo practitioner subject to the value-based payment modifier are adjusted to account for the group's and solo practitioner's specialty mix, by computing the weighted average of the national specialty specific expected costs and comparing this to the group's actual risk adjusted costs. Each national specialty-specific expected cost is weighted by the proportion of Part B payments incurred by each specialty within the group. (5) The national specialty-specific expected costs referenced in paragraph (c)(4) of this section are derived by calculating, for each specialty, the weighted average of the risk-adjusted costs computed across all groups, where the weight for each group is equal to the number of beneficiaries attributed to the group, times the number of eligible professionals in the group with the relevant specialty, times the proportion of eligible professionals in the group with the relevant specialty. [78 FR 74821, Dec. 10, 2013, as amended at 79 FR 68007, Nov. 13, 2014; 80 FR 71383, Nov. 16, 2015] § 414.1240 Attribution for quality of care and cost measures. (a) Beneficiaries are attributed to groups and solo practitioners subject to the value-based payment modifier using a method generally consistent with the method of assignment of beneficiaries under § 425.402 of this chapter, for measures other than the Medicare Spending per Beneficiary measure. (b) For the Medicare Spending per Beneficiary (MSPB) measure, an MSPB episode is attributed to the group or the solo practitioner subject to the value-based payment modifier whose eligible professionals submitted the plurality of claims (as measured by allowable charges) under the group's or solo practitioner's TIN for Medicare Part B services, rendered during an inpatient hospitalization that is an index admission for the MSPB measure during the applicable performance period described at § 414.1215. [79 FR 68007, Nov. 13, 2014] § 414.1245 Scoring methods for the value-based payment modifier using the quality-tiering approach. For each quality of care and cost measure, a standardized score is calculated for each group and solo practitioner subject to the value-based payment modifier by dividing— (a) The difference between their performance rate and the benchmark, by (b) The measure's standard deviation. [77 FR 69368, Nov. 16, 2012, as amended at 79 FR 68007, Nov. 13, 2014] § 414.1250 Benchmarks for quality of care measures. (a) The benchmark for quality of care measures reported through the PQRS using the claims, registries, QCDR, or web interface is the national mean for that measure's performance rate (regardless of the reporting mechanism) during the year prior to the performance period. In calculating the national benchmark, solo practitioners' and groups' (or individual eligible professionals' within such groups) performance rates are weighted by the number of beneficiaries used to calculate the solo practitioners' or groups' (or individual eligible professionals' within such groups) performance rate. Beginning with the CY 2016 performance period, eCQMs reported via EHRs are excluded from the overall benchmark for quality of care measures and separate eCQM benchmarks will be developed. The eCQM benchmark is the national mean for the measure's performance rate during the year prior to the performance period. In calculating the national benchmark, solo practitioners' and groups' (or individual eligible professionals' within such groups) performance rates are weighted by the number of beneficiaries used to calculate the solo practitioners' or groups' (or individual eligible professionals' within such groups) performance rate. (b) The benchmark for each outcome measure under § 414.1230, is the national mean for that measure's performance rate during the year prior to the performance period. In calculating the national benchmark, solo practitioners' and groups' (or individual eligible professionals' within such groups) performance rates are weighted by the number of beneficiaries used to calculate the solo practitioners' or groups' (or individual eligible professionals' within such groups) performance rate. [79 FR 68007, Nov. 13, 2014, as amended at 80 FR 71384, Nov. 16, 2015] § 414.1255 Benchmarks for cost measures. (a) For the CY 2015 payment adjustment period, the benchmark for each cost measure is the national mean of the performance rates calculated among all groups of physicians for which beneficiaries are attributed to the group of physicians that are subject to the value-based payment modifier. In calculating the national benchmark, groups of physicians' performance rates are weighted by the number of beneficiaries used to calculate the group of physician's performance rate. (b) Beginning with the CY 2016 payment adjustment period, the benchmark for each cost measure is the national mean of the performance rates calculated among all groups and solo practitioners that meet the minimum number of cases for that measure under § 414.1265(a). In calculating the national benchmark, groups and solo practitioners' performance rates are weighted by the number of beneficiaries used to calculate the group or solo practitioner's performance rate. [78 FR 74821, Dec. 10, 2013, as amended at 79 FR 68007, Nov. 13, 2014; 80 FR 71384, Nov. 16, 2015] § 414.1260 Composite scores. (a)(1) The standardized score for each quality of care measure is classified into one of the following equally weighted domains to determine the quality composite: (i) Patient safety. (ii) Patient experience. (iii) Care coordination. (iv) Clinical care. (v) Population/community health. (vi) Efficiency. (2) If a domain includes no measure or does not reach the minimum case size in § 414.1265, the remaining domains are equally weighted to form the quality of care composite. (b)(1) The standardized score for each cost measure is grouped into two separate and equally weighted domains to determine the cost composite: (i) Total per capita costs for all attributed beneficiaries: Total per capita costs measure and Medicare Spending per Beneficiary measure; and (ii) Total per capita costs for all attributed beneficiaries with specific conditions: Diabetes, coronary artery disease, chronic obstructive pulmonary disease, or heart failure (four measures). (2) Measures within each domain are equally weighted. [77 FR 69368, Nov. 16, 2012, as amended at 78 FR 74821, Dec. 10, 2013] § 414.1265 Reliability of measures. To calculate a composite score for a quality measure or a cost measure, a group or solo practitioner subject to the value-based payment modifier must have 20 or more cases for that measure. (a) In a performance period, if a group or solo practitioner has fewer than 20 cases for a measure, that measure is excluded from its domain and the remaining measures in the domain are given equal weight. (1) Starting with the CY 2017 payment adjustment period, the exception to this paragraph (a) is the all-cause hospital readmissions measure described at § 414.1230(c). In a performance period, if a group has fewer than 200 cases for this all-cause hospital readmissions measure, that measure is excluded from its domain and the remaining measures in the domain are given equal weight. (2) Starting with the CY 2017 payment adjustment period, the Medicare Spending Per Beneficiary measure described at § 414.1235(a)(6) is an exception to this paragraph (a). In a performance period, if a group or a solo practitioner has fewer than 125 episodes for this MSPB measure, that measure is excluded from its domain and the remaining measures in the domain are given equal weight. (b)(1) For the CY 2015 payment adjustment period, if a reliable quality of care composite or cost composite cannot be calculated, payments will not be adjusted under the value-based payment modifier. (2) Beginning with the CY 2016 payment adjustment period, a group and a solo practitioner subject to the value-based payment modifier will receive a quality composite score that is classified as “average” under § 414.1275(b)(1) if such group and solo practitioner do not have at least one quality measure that meets the minimum number of cases under paragraph (a) of this section. (3) Beginning with the CY 2016 payment adjustment period, a group and a solo practitioner subject to the value-based payment modifier will receive a cost composite score that is classified as “average” under § 414.1275(b)(2) if such group and solo practitioner do not have at least one cost measure that meets the minimum number of cases under paragraph (a) of this section. [77 FR 69368, Nov. 16, 2012, as amended at 79 FR 68007, Nov. 13, 2014; 80 FR 71384, Nov. 16, 2015] § 414.1270 Determination and calculation of Value-Based Payment Modifier adjustments. (a) For the CY 2015 payment adjustment period: (1) Downward payment adjustments. (i) Such group neither self-nominates for the PQRS GPRO and reports at least one measure, nor elects the PQRS administrative claims option for CY 2013 as defined in § 414.90(h). (A) Such adjustment will be −1.0 percent. (B) [Reserved] (ii) Such group elects that its value-based payment modifier be calculated using a quality-tiering approach, and is determined to have poor performance (low quality and high costs; low quality and average costs; or average quality and high costs). (A) Such adjustment will not exceed −1.0 percent as specified in § 414.1275(c)(1). (B) [Reserved] (2) No payment adjustments. (i) Self-nominates for the PQRS GPRO and reports at least one measure; or (ii) Elects the PQRS administrative claims option for CY 2013 as defined in § 414.90(h). (3) Upward payment adjustments. (b) For the CY 2016 payment adjustment period: (1) A downward payment adjustment of −2.0 percent will be applied to a group of physicians subject to the value-based payment modifier if, during the applicable performance period as defined in § 414.1215, the following apply: (i) Such group does not self-nominate for the PQRS GPRO and meet the criteria as a group to avoid the PQRS payment adjustment for CY 2016 as specified by CMS; and (ii) Fifty percent of the eligible professionals in such group do not meet the criteria as individuals to avoid the PQRS payment adjustment for CY 2016 as specified by CMS. (2) For a group of physicians comprised of 100 or more eligible professionals that is not included in paragraph (b)(1) of this section, the value-based payment modifier adjustment will be equal to the amount determined under § 414.1275(c)(2). (3) For a group of physicians comprised of between 10 and 99 eligible professionals that is not included in paragraph (b)(1) of this section, the value-based payment modifier adjustment will be equal to the amount determined under § 414.1275(c)(2), except that such adjustment will be 0.0 percent if the group of physicians is determined to be low quality/high cost, low quality/average cost, or average quality/high cost. (4) If at least fifty percent of the eligible professionals in the group meet the criteria as individuals to avoid the PQRS payment adjustment for CY 2016 as specified by CMS, and all of those eligible professionals use a qualified clinical data registry and CMS is unable to receive quality performance data for them, the quality composite score for such group will be classified as “average” under § 414.1275(b)(1). (c) For the CY 2017 payment adjustment period: (1) A downward payment adjustment of −2.0 percent will be applied to a group with two to nine eligible professionals and a solo practitioner and a downward payment adjustment of −4.0 percent will be applied to a group with 10 or more eligible professionals subject to the value-based payment modifier if, during the applicable performance period as defined in § 414.1215, the following apply: (i) Such group does not meet the criteria as a group to avoid the PQRS payment adjustment for CY 2017 as specified by CMS; and (ii) Fifty percent of the eligible professionals in such group do not meet the criteria as individuals to avoid the PQRS payment adjustment for CY 2017 as specified by CMS; or (iii) Such solo practitioner does not meet the criteria as an individual to avoid the PQRS payment adjustment for CY 2017 as specified by CMS. (2) For a group comprised of 10 or more eligible professionals that is not included in paragraph (c)(1) of this section, the value-based payment modifier adjustment will be equal to the amount determined under § 414.1275(c)(3)(i). (3) For a group comprised of between two to nine eligible professionals and a solo practitioner that are not included in paragraph (c)(1) of this section, the value-based payment modifier adjustment will be equal to the amount determined under § 414.1275(c)(3)(ii). (4) If at least fifty percent of the eligible professionals in the group meet the criteria as individuals to avoid the PQRS payment adjustment for CY 2017 as specified by CMS, and all of those eligible professionals use a qualified clinical data registry and CMS is unable to receive quality performance data for them, the quality composite score for such group will be classified as “average” under § 414.1275(b)(1). (d) For the CY 2018 payment adjustment period: (1) A downward payment adjustment of −1.0 percent will be applied to a solo practitioner, a group with two to nine eligible professionals, and a group consisting only of nonphysician eligible professionals subject to the value-based payment modifier and no physicians; and a downward payment adjustment of −2.0 percent will be applied to a group with 10 or more eligible professionals and at least one physician if, during the applicable performance period as defined in § 414.1215, the following apply: (i) For groups: (A) Such group does not meet the criteria as a group to avoid the PQRS payment adjustment for CY 2018 as specified by CMS; and (B) Fifty percent of the eligible professionals in such group do not meet the criteria as individuals to avoid the PQRS payment adjustment for CY 2018 as specified by CMS. (ii) For solo practitioners, such solo practitioner does not meet the criteria as an individual to avoid the PQRS payment adjustment for CY 2018 as specified by CMS. (2) For a group composed of 10 or more eligible professionals that is not included in paragraph (d)(1) of this section, the value-based payment modifier adjustment will be equal to the amount determined under § 414.1275(c)(4)(i). (3) For a group composed of between two to nine eligible professionals and a solo practitioner that are not included in paragraph (d)(1) of this section, the value-based payment modifier adjustment will be equal to the amount determined under § 414.1275(c)(4)(ii). (4) For a group and a solo practitioner consisting of nonphysician eligible professionals that are not included in paragraph (d)(1) of this section, the value-based payment modifier adjustment will be equal to the amount determined under § 414.1275(c)(4)(iii). (5) If at least 50 percent of the eligible professionals in the group meet the criteria as individuals to avoid the PQRS payment adjustment for CY 2018 as specified by CMS, and all of those eligible professionals use a qualified clinical data registry and CMS is unable to receive quality performance data for them, the quality composite score for such group will be classified as “average” under § 414.1275(b)(1). [78 FR 74821, Dec. 10, 2013, as amended at 79 FR 68007, Nov. 13, 2014; 80 FR 71384, Nov. 16, 2015; 82 FR 53363, Nov. 15, 2017] § 414.1275 Value-based payment modifier quality-tiering scoring methodology. (a) The value-based payment modifier amount for a group and a solo practitioner subject to the value-based payment modifier is based upon a comparison of the composite of quality of care measures and a composite of cost measures. (b) Quality composite and cost composite are classified into high, average, and low categories based on whether the composites are statistically above, not different from, or below the mean composite scores. (1) Quality composites that are one or more standard deviations above the mean are classified into the high category. Quality composites that are one or more standard deviations below the mean are classified into the low category. (2) Cost composites that are one or more standard deviations below the mean are classified into the low category. Cost composites that are one or more standard deviations above the mean are classified into the high category. (c)(1) The following value-based payment modifier percentages apply to the CY 2015 payment adjustment period: CY 2015 Value-Based Payment Modifier Amounts for the Quality-Tiering Approach Quality/cost Low cost Average cost High cost High quality + 2.0x* + 1.0x* + 0.0 Average quality + 1.0x* + 0.0% -0.5 Low quality + 0.0% -0.5% -1.0 * Groups of physicians eligible for an additional + 1.0x if (1) reporting Physician Quality Reporting System quality measures through the GPRO web-interface or CMS-qualified registry, and (2) average beneficiary risk score is in the top 25 percent of all beneficiary risk scores. (2) The following value-based payment modifier percentages apply to the CY 2016 payment adjustment period: CY 2016 Value-Based Payment Modifier Amounts for the Quality-Tiering Approach Quality/cost Low cost Average cost High cost High quality + 2.0x* + 1.0x* + 0.0 Average quality + 1.0x* + 0.0% -1.0 Low quality + 0.0% -1.0% -2.0 * Groups of physicians eligible for an additional + 1.0x if reporting Physician Quality Reporting System quality measures and average beneficiary risk score is in the top 25 percent of all beneficiary risk scores. (3) The following value-based payment modifier percentages apply to the CY 2017 payment adjustment period: (i) For groups with 10 or more eligible professionals: CY 2017 Value-Based Payment Modifier Amounts for the Quality-Tiering Approach for Groups With 10 or More Eligible Professionals Cost/quality Low quality Average quality High quality Low Cost + 0.0% * + 2.0x * + 4.0x Average Cost −2.0% + 0.0% * + 2.0x High Cost −4.0% −2.0% + 0.0% * Groups eligible for an additional + 1.0x if reporting Physician Quality Reporting System quality measures and average beneficiary risk score is in the top 25 percent of all beneficiary risk scores, where `x' represents the upward payment adjustment factor. (ii) For groups with two to nine eligible professionals and solo practitioners: CY 2017 Value-Based Payment Modifier Amounts for the Quality-Tiering Approach for Groups With Two to Nine Eligible Professionals and Solo Practitioners Cost/quality Low quality Average quality High quality Low Cost + 0.0% * + 1.0x * + 2.0x Average Cost + 0.0% + 0.0% * + 1.0x High Cost + 0.0% + 0.0% + 0.0% * Groups and solo practitioners eligible for an additional + 1.0x if reporting Physician Quality Reporting System quality measures and average beneficiary risk score is in the top 25 percent of all beneficiary risk scores, where `x' represents the upward payment adjustment factor. (4) The following value-based payment modifier percentages apply to the CY 2018 payment adjustment period, for physicians, physician assistants, nurse practitioners, clinical nurse specialists, and certified registered nurse anesthetists who are solo practitioners or who are in groups of any size: CY 2018 Value-Based Payment Modifier Amounts for the Quality-Tiering Approach for Physicians, Physician Assistants, Nurse Practitioners, Clinical Nurse Specialists, and Certified Registered Nurse Anesthetists Cost/quality Low quality Average High quality Low Cost +0.0% * +1.0x * +2.0x Average Cost +0.0% +0.0% * +1.0x High Cost +0.0% +0.0% +0.0% * Eligible for an additional +1.0x if reporting Physician Quality Reporting System quality measures and average beneficiary risk score is in the top 25 percent of all beneficiary risk scores, where `x' represents the upward payment adjustment factor. (d)(1) Groups of physicians subject to the value-based payment modifier that have an attributed beneficiary population with an average risk score in the top 25 percent of the risk scores of beneficiaries nationwide and for the CY 2015 payment adjustment period elect the quality-tiering approach or for the CY 2016 payment adjustment period are subject to the quality-tiering approach, receive a greater upward payment adjustment as follows: (i) Classified as high quality/low cost receive an upward adjustment of + 3x (rather than + 2x); and (ii) Classified as either high quality/average cost or average quality/low cost receive an upward adjustment of + 2x (rather than + 1x). (2) Groups and solo practitioners subject to the value-based payment modifier that have an attributed beneficiary population with an average risk score in the top 25 percent of the risk scores of beneficiaries nationwide and for the CY 2017 payment adjustment period are subject to the quality-tiering approach, receive a greater upward payment adjustment as follows: (i) Classified as high quality/low cost receive an upward adjustment of + 5x (rather than + 4x) if the group has 10 or more eligible professionals or + 3x (rather than + 2x) if a solo practitioner or the group has two to nine eligible professionals; and (ii) Classified as either high quality/average cost or average quality/low cost receive an upward adjustment of + 3x (rather than + 2x) if the group has 10 or more eligible professionals or + 2x (rather than + 1x) if a solo practitioner or the group has two to nine eligible professionals. (3) Groups and solo practitioners subject to the value-based payment modifier that have an attributed beneficiary population with an average risk score in the top 25 percent of the risk scores of beneficiaries nationwide and for the CY 2018 payment adjustment period are subject to the quality-tiering approach, receive a greater upward payment adjustment as follows: (i) Classified as high quality/low cost receive an upward adjustment of +3x (rather than +2x); and (ii) Classified as either high quality/average cost or average quality/low cost receive an upward adjustment of +2x (rather than +1x). [77 FR 69368, Nov. 16, 2012, as amended at 78 FR 74822, Dec. 10, 2013; 79 FR 68008, Nov. 13, 2014; 80 FR 71385, Nov. 16, 2015; 82 FR 53363, Nov. 15, 2017] § 414.1280 Limitation on review. (a) There shall be no administrative or judicial review under section 1869 of the Act, section 1878 of the Act, or otherwise of all of the following: (1) The establishment of the value-based payment modifier. (2) The evaluation of the quality of care composite, including the establishment of appropriate measure of the quality of care. (3) The evaluation of costs composite, including establishment of appropriate measures of costs. (4) The dates of implementation of the value-based payment modifier. (5) The specification of the initial performance period and any other performance period. (6) The application of the value-based payment modifier. (7) The determination of costs. (b) [Reserved] § 414.1285 Informal inquiry process. After the dissemination of the annual Physician Feedback reports, a group and a solo practitioner may contact CMS to inquire about its report and the calculation of the value-based payment modifier. [77 FR 69368, Nov. 16, 2012, as amended at 79 FR 68008, Nov. 13, 2014] Subpart O—Merit-Based Incentive Payment System and Alternative Payment Model Incentive Source: 81 FR 77537, Nov. 4, 2016, unless otherwise noted. § 414.1300 Basis and scope. (a) Basis. (1) Section 1833(z)—Incentive Payments for Participation in Eligible Alternative Payment Models. (2) Section 1848(k)—Quality Reporting System. (3) Section 1848(m)—Incentive Payments for Quality Reporting. (4) Section 1848(q)—Merit-based Incentive Payment System. (b) Scope. (1) The circumstances under which eligible clinicians are not considered MIPS eligible clinicians with respect to a year. (2) How individual MIPS eligible clinicians can have their performance assessed as a group. (3) The data submission methods and data submission criteria for each of the MIPS performance categories. (4) Methods for calculating a performance category score for each of the MIPS performance categories. (5) Methods for calculating a MIPS final score and applying the MIPS payment adjustment to MIPS eligible clinicians. (6) Requirements for an APM to be designated an “Advanced APM.” (7) Methods for eligible clinicians and entities participating in Advanced APMs to meet the participation thresholds to become Qualifying APM Participants (QPs) and Partial QPs. (8) Methods and processes for counting participation in Other Payer Advanced APMs in making QP and Partial QP determinations. (9) Methods for calculating and paying the APM Incentive Payment to QPs. (10) Criteria for Physician-Focused Payment Models (PFPMs). [81 FR 77537, Nov. 4, 2016, as amended at 86 FR 65669, Nov. 19, 2021] § 414.1305 Definitions. As used in this section, unless otherwise indicated— Additional performance threshold Advanced Alternative Payment Model (Advanced APM) Affiliated practitioner Affiliated practitioner list Aligned Other Payer Medical Home Model (1) The other payer payment arrangement has a primary care focus with participants that primarily include primary care practices or multispecialty practices that include primary care physicians and practitioners and offer primary care services. For the purposes of this provision, primary care focus means the inclusion of specific design elements related to eligible clinicians practicing under one or more of the following Physician Specialty Codes: 01 General Practice; 08 Family Medicine; 11 Internal Medicine; 16 Obstetrics and Gynecology; 37 Pediatric Medicine; 38 Geriatric Medicine; 50 Nurse Practitioner; 89 Clinical Nurse Specialist; and 97 Physician Assistant; (2) Empanelment of each patient to a primary clinician; and (3) At least four of the following: (i) Planned coordination of chronic and preventive care. (ii) Patient access and continuity of care. (iii) Risk-stratified care management. (iv) Coordination of care across the medical neighborhood. (v) Patient and caregiver engagement. (vi) Shared decision-making. (vii) Payment arrangements in addition to, or substituting for, fee-for-service payments (for example, shared savings or population-based payments). Alternative Payment Model (APM) (1) A model under section 1115A of the Act (other than a health care innovation award). (2) The shared savings program under section 1899 of the Act. (3) A demonstration under section 1866C of the Act. (4) A demonstration required by Federal law. Ambulatory Surgical Center (ASC)-based MIPS eligible clinician (1) For the 2019 and 2020 MIPS payment years, a MIPS eligible clinician who furnishes 75 percent or more of his or her covered professional services in sites of service identified by the Place of Service (POS) codes used in the HIPAA standard transaction as an ambulatory surgical center setting based on claims for a period prior to the performance period as specified by CMS; and (2) Beginning with the 2021 MIPS payment year, a MIPS eligible clinician who furnishes 75 percent or more of his or her covered professional services in sites of service identified by the POS codes used in the HIPAA standard transaction as an ambulatory surgical center setting based on claims for the MIPS determination period. APM Entity APM Entity group APM Incentive Payment Attestation Attributed beneficiary Attribution-eligible beneficiary (1) Is not enrolled in Medicare Advantage or a Medicare cost plan; (2) Does not have Medicare as a secondary payer; (3) Is enrolled in both Medicare Parts A and B; (4) Is at least 18 years of age; (5) Is a United States resident; and (6) Has a minimum of one claim for evaluation and management services furnished by an eligible clinician who is in the APM Entity for any period during the QP Performance Period or, for an Advanced APM that does not base attribution on evaluation and management services and for which attributed beneficiaries are not a subset of the attribution-eligible beneficiary population based on the requirement to have at least one claim for evaluation and management services furnished by an eligible clinician who is in the APM Entity for any period during the QP Performance Period, the attribution basis determined by CMS based upon the methodology the Advanced APM uses for attribution, which may include a combination of evaluation and management and other services. Certified Electronic Health Record Technology (CEHRT) (1) For any calendar year before 2019, EHR technology (which could include multiple technologies) certified under the ONC Health IT Certification Program that meets one of the following: (i) The 2014 Edition Base EHR definition (as defined at 45 CFR 170.102) and that has been certified to the certification criteria that are necessary to report on applicable objectives and measures specified for the MIPS advancing care information performance category, including the applicable measure calculation certification criterion at 45 CFR 170.314(g)(1) or (2) for all certification criteria that support an objective with a percentage-based measure. (ii) Certification to— (A) The following certification criteria: ( 1 ( i ( ii ( 2 i ( ii ( 3 i ( ii ( 4 i ( ii ( 5 i ( ii ( 6 i ( ii) ( 7 ( i ( ii ( iii ( iv ( v ( vi ( vii ( viii ( ix ( x ( xi ( xii ( xiii ( xiv ( xv ( xvi ( xvii ( xviii ( xix ( xx ( xxi (B) Clinical quality measures at— ( 1 ( 2 ( 3 (C) Privacy and security at— ( 1 ( 2 ( 3 ( 4 ( 5 ( 6 ( 7 ( 8 (D) The certification criteria that are necessary to report on applicable objectives and measures specified for the MIPS Promoting Interoperability performance category, including the applicable measure calculation certification criterion at 45 CFR 170.314(g)(1) or (2) or 45 CFR 170.315(g)(1) or (2) for all certification criteria that support an objective with a percentage-based measure. (iii) The definition for 2019 and subsequent years specified in paragraph (2) of this definition. (2) For 2019 and subsequent years, EHR technology (which could include multiple technologies) certified under the ONC Health IT Certification Program that meets the 2015 Edition Base EHR definition, or subsequent Base EHR definition (as defined in 45 CFR 170.102), and has been certified to the ONC health IT certification criteria as adopted and updated in 45 CFR 170.315— (i) At 45 CFR 170.315(a)(12) (family health history) and 45 CFR 170.315(e)(3) (patient health information capture); and (ii) Necessary to report on applicable objectives and measures specified for MIPS including the following: (A) The applicable measure calculation certification criterion at 45 CFR 170.315(g)(1) or (2) for all certification criteria that support an objective with a percentage-based measure. (B) Clinical quality measure certification criteria that support the calculation and reporting of clinical quality measures at 45 CFR 170.315(c)(2) and (c)(3)(i) and (ii) and optionally (c)(4), and can be electronically accepted by CMS. (3) For purposes of determinations under §§ 414.1415 and 414.1420, beginning for CY 2024, EHR technology (which could include multiple technologies) certified under the ONC Health IT Certification Program that meets— (i) The 2015 Edition Base EHR definition, or subsequent Base EHR definition (as defined in 45 CFR 170.102); and (ii) Any such ONC health IT certification criteria adopted or updated in 45 CFR 170.315 that are determined applicable for the APM, for the year, considering factors such as clinical practice area, promotion of interoperability, relevance to reporting on applicable quality measures, clinical care delivery objectives of the APM, or any other factor relevant to documenting and communicating clinical care to patients or their health care providers in the APM. CMS-approved survey vendor CMS Multi-Payer Model CMS Web Interface Collection type Covered professional services Covered professional service attribution-eligible beneficiary (1) Is not enrolled in Medicare Advantage or a Medicare cost plan; (2) Does not have Medicare as a secondary payer; (3) Is enrolled in both Medicare Parts A and B; (4) Is at least 18 years of age; (5) Is a United States resident; and (6) Has a minimum of one claim for a Covered Professional Service furnished by an eligible clinician who is in the APM Entity for any period during the QP Performance Period. Eligible clinician (1) A physician. (2) A practitioner described in section 1842(b)(18)(C) of the Act. (3) A physical or occupational therapist or a qualified speech-language pathologist. (4) A qualified audiologist (as defined in section 1861(ll)(3)(B) of the Act). E/M attribution-eligible beneficiary (1) Is not enrolled in Medicare Advantage or a Medicare cost plan; (2) Does not have Medicare as a secondary payer; (3) Is enrolled in both Medicare Parts A and B; (4) Is at least 18 years of age; (5) Is a United States resident; and (6) Has a minimum of one claim for evaluation and management services furnished by an eligible clinician who is in the APM Entity for any period during the QP Performance Period. Episode payment model Estimated aggregate payment amounts Facility-based group Facility-based MIPS eligible clinician Final score Group Health IT vendor Health Professional Shortage Areas (HPSA) High priority measure Hospital-based MIPS eligible clinician (1) For the 2019 and 2020 MIPS payment years, a MIPS eligible clinician who furnishes 75 percent or more of his or her covered professional services in sites of service identified by the Place of Service (POS) codes used in the HIPAA standard transaction as an inpatient hospital, on-campus outpatient hospital, off campus-outpatient hospital, or emergency room setting based on claims for a period prior to the performance period as specified by CMS; and (2) For the 2021 MIPS payment year, a MIPS eligible clinician who furnishes 75 percent or more of his or her covered professional services in sites of service identified by the POS codes used in the HIPAA standard transaction as an inpatient hospital, on-campus outpatient hospital, off campus outpatient hospital, or emergency room setting based on claims for the MIPS determination period; and (3) Beginning with the 2022 MIPS payment year, an individual MIPS eligible clinician who furnishes 75 percent or more of his or her covered professional services in sites of service identified by the POS codes used in the HIPAA standard transaction as an inpatient hospital, on-campus outpatient hospital, off campus outpatient hospital, or emergency room setting based on claims for the MIPS determination period, and a group or virtual group provided that more than 75 percent of the NPIs billing under the group's TIN or virtual group's TINs, as applicable, meet the definition of a hospital-based individual MIPS eligible clinician during the MIPS determination period. Improvement activities Improvement scoring Incentive payment base period Low-volume threshold (1) For the 2019 MIPS payment year, the low-volume threshold that applies to an individual eligible clinician, group, or APM Entity group that, during the low-volume threshold determination period described in paragraph (4) of this definition, has Medicare Part B allowed charges less than or equal to $30,000 or provides care for 100 or fewer Medicare Part B-enrolled individuals. (2) For the 2020 MIPS payment year, the low-volume threshold that applies to an individual eligible clinician, group, or APM Entity group that, during the low-volume threshold determination period described in paragraph (4) of this definition, has allowed charges for covered professional services less than or equal to $90,000 or furnishes covered professional services to 200 or fewer Medicare Part B-enrolled individuals. (3) For the 2021 and 2022 MIPS payment years, the low-volume threshold that applies to an individual eligible clinician, group, or APM Entity group that, during the MIPS determination period, has allowed charges for covered professional services less than or equal to $90,000, furnishes covered professional services to 200 or fewer Medicare Part B-enrolled individuals, or furnishes 200 or fewer covered professional services to Medicare Part B-enrolled individuals. (4) For the 2019 and 2020 MIPS payment years, the low-volume threshold determination period is a 24-month assessment period consisting of: (i) An initial 12-month segment that spans from the last 4 months of the calendar year 2 years prior to the performance period through the first 8 months of the calendar year preceding to the performance period; and (ii) A second 12-month segment that spans from the last 4 months of the calendar year 1 year prior to the performance period through the first 8 months of the calendar year performance period. An individual eligible clinician, group, or APM Entity group that is identified as not exceeding the low-volume threshold during the initial 12-month segment will continue to be excluded under § 414.1310(b)(1)(iii) for the applicable year regardless of the results of the second 12-month segment analysis. For the 2019 MIPS payment year, each segment of the low-volume threshold determination period includes a 60-day claims run out. For the 2020 MIPS payment year, each segment of the low-volume threshold determination period includes a 30-day claims run out. (5) Beginning with the 2023 MIPS payment year, the low-volume threshold that applies to an individual eligible clinician, or group that, during the MIPS determination period, has allowed charges for covered professional services less than or equal to $90,000, furnishes covered professional services to 200 or fewer Medicare Part B-enrolled individuals, or furnishes 200 or fewer covered professional services to Medicare Part B-enrolled individuals. Meaningful EHR user for MIPS Measure benchmark Medicaid APM Medical Home Model (1) The APM has a primary care focus with participants that primarily include primary care practices or multispecialty practices that include primary care physicians and practitioners and offer primary care services. For the purposes of this provision, primary care focus means the inclusion of specific design elements related to eligible clinicians practicing under one or more of the following Physician Specialty Codes: 01 General Practice; 08 Family Medicine; 11 Internal Medicine; 16 Obstetrics and Gynecology; 37 Pediatric Medicine; 38 Geriatric Medicine; 50 Nurse Practitioner; 89 Clinical Nurse Specialist; and 97 Physician Assistant; (2) Empanelment of each patient to a primary clinician; and (3) At least four of the following: (i) Planned coordination of chronic and preventive care. (ii) Patient access and continuity of care. (iii) Risk-stratified care management. (iv) Coordination of care across the medical neighborhood. (v) Patient and caregiver engagement. (vi) Shared decision-making. (vii) Payment arrangements in addition to, or substituting for, fee-for-service payments (for example, shared savings or population-based payments). Medicaid Medical Home Model (1) The payment arrangement has a primary care focus with participants that primarily include primary care practices or multispecialty practices that include primary care physicians and practitioners and offer primary care services. For the purposes of this provision, primary care focus means the inclusion of specific design elements related to eligible clinicians practicing under one or more of the following Physician Specialty Codes: 01 General Practice; 08 Family Medicine; 11 Internal Medicine; 16 Obstetrics and Gynecology; 37 Pediatric Medicine; 38 Geriatric Medicine; 50 Nurse Practitioner; 89 Clinical Nurse Specialist; and 97 Physician Assistant; (2) Empanelment of each patient to a primary clinician; and (3) At least four of the following: (i) Planned coordination of chronic and preventive care. (ii) Patient access and continuity. (iii) Risk-stratified care management. (iv) Coordination of care across the medical neighborhood. (v) Patient and caregiver engagement. (vi) Shared decision-making. (vii) Payment arrangements in addition to, or substituting for, fee-for-service payments (for example, shared savings or population-based payments). Merit-based Incentive Payment System (MIPS) MIPS APM (1) For the 2019 through 2022 MIPS payment years, an APM that meets the criteria specified under § 414.1370(b). (2) Beginning with the 2023 MIPS payment year, an APM that meets the criteria as set forth in § 414.1367(b). MIPS determination period (1) Beginning with the 2021 MIPS payment year, a 24-month assessment period consisting of: (i) An initial 12-month segment beginning on October 1 of the calendar year 2 years prior to the applicable performance period and ending on September 30 of the calendar year preceding the applicable performance period, and that includes a 30-day claims run out; and (ii) A second 12-month segment beginning on October 1 of the calendar year preceding the applicable performance period and ending on September 30 of the calendar year in which the applicable performance period occurs. (2) Subject to § 414.1310(b)(1)(iii), an individual eligible clinician, group, or APM Entity group that is identified as not exceeding the low-volume threshold or as having special status, as applicable, during the first segment of the MIPS determination period will be identified as such for the applicable MIPS payment year regardless of the results of the second segment of the MIPS determination period. An individual eligible clinician, group, or APM Entity group for which the unique billing TIN and NPI combination is established during the second segment of the MIPS determination period will be assessed based solely on the results of such segment. MIPS eligible clinician (1) For the 2019 and 2020 MIPS payment years: (i) A physician (as defined in section 1861(r) of the Act); (ii) A physician assistant, a nurse practitioner, and clinical nurse specialist (as such terms are defined in section 1861(aa)(5) of the Act); (iii) A certified registered nurse anesthetist (as defined in section 1861(bb)(2) of the Act); and (iv) A group that includes such clinicians. (2) For the 2021 through 2023 MIPS payment years: (i) A clinician described in paragraph (1) of this definition; (ii) A physical therapist or occupational therapist; (iii) A qualified speech-language pathologist; (iv) A qualified audiologist (as defined in section 1861(ll)(3)(B) of the Act); (v) A clinical psychologist (as defined by the Secretary for purposes of section 1861(ii) of the Act); (vi) A registered dietician or nutrition professional; and (vii) A group that includes such clinicians. (3) For the 2024 MIPS payment year and future years: (i) A clinician described in paragraph (2) of this definition; (ii) A clinical social worker (as defined in section 1861(hh)(1) of the Act); (iii) A certified nurse midwife (as defined in section 1861(gg)(2) of the Act); and (iv) A group that includes such clinicians. MIPS payment year MIPS Value Pathway Multispecialty group means a group as defined at § 414.1305 that consists of clinicians in two or more specialty types or clinicians involved in multiple foci of care. MVP participant means an individual MIPS eligible clinician, multispecialty group, single-specialty group, subgroup, or APM Entity that is assessed on an MVP in accordance with § 414.1365 for all MIPS performance categories. For the CY 2026 performance period/2028 MIPS payment year and future years, MVP Participant means an individual MIPS eligible clinician, single-specialty group, multispecialty group that meets the requirements of a small practice, subgroup, or APM Entity that is assessed on an MVP in accordance with § 414.1365 for all MIPS performance categories. New Medicare-Enrolled MIPS eligible clinician Non-patient facing MIPS eligible clinician (1) For the 2019 and 2020 MIPS payment year, an individual MIPS eligible clinician who bills 100 or fewer patient facing encounters (including Medicare telehealth services defined in section 1834(m) of the Act), as described in paragraph (3) of this definition, during the non-patient facing determination period described in paragraph (4) of this definition, and a group or virtual group provided that more than 75 percent of the NPIs billing under the group's TIN or virtual group's TINs, as applicable, meet the definition of a non-patient facing individual MIPS eligible clinician. (2) Beginning with the 2021 MIPS payment year, an individual MIPS eligible clinician who bills 100 or fewer patient facing encounters (including Medicare telehealth services defined in section 1834(m) of the Act), as described in paragraph (3) of this definition, during the MIPS determination period, and a group or virtual group provided that more than 75 percent of the NPIs billing under the group's TIN or virtual group's TINs, as applicable, meet the definition of a non-patient facing individual MIPS eligible clinician. (3) For purposes of this definition, a patient-facing encounter is an instance in which the individual MIPS eligible clinician or group bills for items and services furnished such as general office visits, outpatient visits, and procedure codes under the PFS, as specified by CMS. (4) For the 2019 and 2020 MIPS payment year, the non-patient facing determination period is a 24-month assessment period consisting of: (i) An initial 12-month segment that spans from the last 4 months of the calendar year 2 years prior to the performance period through the first 8 months of the calendar year preceding the performance period; and (ii) A second 12-month segment that spans from the last 4 months of the calendar year 1 year prior to the performance period through the first 8 months of the calendar year performance period. An individual eligible MIPS clinician, group, or virtual group that is identified as non-patient facing during the initial 12-month segment will continue to be considered non-patient facing for the applicable year regardless of the results of the second 12-month segment analysis. For the 2019 MIPS payment year, each segment of the non-patient facing determination period includes a 60-day claims run out. For the 2020 MIPS payment year and future years, each segment of the non-patient facing determination period includes a 30-day claims run out. Other MIPS APM Other Payer Advanced APM Other payer arrangement Partial Qualifying APM Participant (Partial QP) Partial QP patient count threshold Partial QP payment amount threshold Participation List Performance category score Performance standards Performance threshold Physician Compare Population health measure Primary care services (1) CPT codes: (i) 99201 through 99215 (codes for office or other outpatient visit for the evaluation and management of a patient); 99304 through 99318 (codes for professional services furnished in a nursing facility, excluding professional services furnished in a SNF for claims identified by place of service (POS) modifier 31); 99319 through 99340 (codes for patient domiciliary, rest home, or custodial care visit); 99341 through 99350 (codes for evaluation and management services furnished in a patient's home for claims identified by POS modifier 12); 99487, 99489, and 99490 (codes for chronic care management); and 99495 and 99496 (codes for transitional care management services); and (ii) Beginning with the 2023 MIPS payment year, 99421, 99422, and 99423 (codes for online digital evaluation and management services (e-visit)); 99441, 99442, and 99443 (codes for telephone evaluation and management services); and 96160 and 96161 (codes for administration of health risk assessment). (2) HCPCS codes: (i) G0402 (code for the Welcome to Medicare visit); and G0438 and G0439 (codes for the annual wellness visits); and (ii) Beginning with the 2023 MIPS payment year, G2010 (code for remote evaluation of patient video/images); and G2012 (code for virtual check-in). QCDR measure (1) Measures that are not included in the MIPS final list of quality measures described in § 414.1330(a)(1) for the applicable MIPS payment year; and (2) Measures that are included in the MIPS final list of quality measures described in § 414.1330(a)(1) for the applicable MIPS payment year, but have undergone substantive changes, as determined by CMS. QP patient count threshold QP payment amount threshold QP Performance Period Qualified clinical data registry (QCDR) (1) For the 2019, 2020 and 2021 MIPS payment year, a CMS-approved entity that has self-nominated and successfully completed a qualification process to determine whether the entity may collect medical or clinical data for the purpose of patient and disease tracking to foster improvement in the quality of care provided to patients. (2) Beginning with the 2022 MIPS payment year, an entity that demonstrates clinical expertise in medicine and quality measurement development experience and collects medical or clinical data on behalf of a MIPS eligible clinician for the purpose of patient and disease tracking to foster improvement in the quality of care provided to patients. Qualified posting Qualified registry Qualifying APM participant (QP) Rural area Single specialty group Small practice (1) For the 2019 MIPS payment year, a TIN consisting of 15 or fewer eligible clinicians. (2) For the 2020 MIPS payment year, a TIN consisting of 15 or fewer eligible clinicians during a 12-month assessment period that spans from the last 4 months of the calendar year 2 years prior to the performance period through the first 8 months of the calendar year preceding the performance period and includes a 30-day claims run out. (3) Beginning with the 2021 MIPS payment year, a TIN consisting of 15 or fewer eligible clinicians during the MIPS determination period. Solo practitioner Special status (1) Meets the definition of an ASC-based MIPS eligible clinician, facility-based MIPS eligible clinician, hospital-based MIPS eligible clinician, non-patient facing MIPS eligible clinician, or is in a small practice; or (2) Is located in an HPSA or rural area. Subgroup Submission type (1) Direct; (2) Log in and upload; (3) Log in and attest; (4) Medicare Part B claims; and (5) CMS Web Interface (except as provided in paragraph (5)(i) of this definition, for the CY 2017 through CY 2022 performance periods/2019 through 2024 MIPS payment years). (i) For the CY 2021 through CY 2024 performance periods/2023 through 2026 MIPS payment years, submission types include the CMS Web Interface for APM Entities reporting through the APM Performance Pathway in accordance with § 414.1367. (ii) [Reserved] Submitter type Third party intermediary Threshold Score Topped out non-process measure Topped out process measure Virtual group [81 FR 77537, Nov. 4, 2016, as amended at 82 FR 53950, Nov. 16, 2017; 83 FR 60075, Nov. 23, 2018; 84 FR 63194, Nov. 15, 2019; 85 FR 54872, Sept. 2, 2020; 85 FR 85029, Dec. 28, 2020; 86 FR 65670, Nov. 19, 2021; 86 FR 73159, Dec. 27, 2021; 87 FR 70227, Nov. 18, 2022; 88 FR 79533, Nov. 16, 2023; 89 FR 54716, July 1, 2024; 90 FR 50009, Nov. 5, 2025; 91 FR 12079, Mar. 12, 2026] § 414.1310 Applicability. (a) Program implementation. (b) Exclusions. (i) Is a Qualifying APM Participant (as defined at § 414.1305); (ii) Is a Partial Qualifying APM Participant and does not elect to participate in MIPS as a MIPS eligible clinician; or (iii) Does not exceed the low volume threshold. (A) Beginning with the 2021 MIPS payment year, if an individual eligible clinician or group exceeds at least one, but not all, of the low-volume threshold criteria and elects to participate in MIPS as a MIPS eligible clinician, the individual eligible clinician or group is treated as a MIPS eligible clinician for the applicable MIPS payment year. For such solo practitioners and groups that elect to participate in MIPS as a virtual group (except for APM Entity groups in MIPS APMs), the virtual group election under § 414.1315 constitutes an election under this paragraph (b)(1)(iii)(A) and results in the solo practitioners and groups being treated as MIPS eligible clinicians for the applicable MIPS payment year. (B) For the 2021 and 2022 MIPS payment years, if an APM Entity group in a MIPS APM exceeds at least one, but not all, of the low-volume threshold criteria and elects to participate in MIPS as a MIPS eligible clinician, the APM Entity group is treated as a MIPS eligible clinician for the applicable MIPS payment year. For such APM Entity groups in MIPS APMs, only the APM Entity group election can result in the APM Entity group being treated as MIPS eligible clinicians for the applicable MIPS payment year. (2) Eligible clinicians, as defined at § 414.1305, who are not MIPS eligible clinicians, as defined at § 414.1305, have the option to voluntarily report measures and activities for MIPS. (c) Treatment of new Medicare-enrolled eligible clinicians. (d) Clarification. (e) Requirements for groups. (2) For individual MIPS eligible clinicians to participate in MIPS as a group, all of the following requirements must be met: (i) Groups must meet the definition of a group at all times during the applicable performance period. (ii) Individual eligible clinicians that elect to participate in MIPS as a group must aggregate their performance data across the group's TIN, and for the Promoting Interoperability performance category, must aggregate the performance data of all of the MIPS eligible clinicians in the group's TIN for whom the group has data in CEHRT. (iii) Individual eligible clinicians that elect to participate in MIPS as a group will have their performance assessed at the group level across all four MIPS performance categories. (iv) Groups must adhere to an election process established by CMS, as applicable. [81 FR 77537, Nov. 4, 2016, as amended at 83 FR 60076, Nov. 23, 2018; 84 FR 63195, Nov. 15, 2019; 85 FR 85030, Dec. 28, 2020; 86 FR 65670, Nov. 19, 2021] § 414.1315 Virtual groups. (a) Eligibility. (2) Except as provided under § 414.1370(f)(2), each MIPS eligible clinician in the virtual group receives a MIPS payment adjustment factor and, if applicable, an additional MIPS payment adjustment factor based on the virtual group's combined performance assessment. (b) Election deadline. (c) Election process. (1) Stage 1: Virtual group eligibility determination. (ii) Beginning with the 2021 MIPS payment year, the virtual group eligibility determination period is the first segment of the MIPS determination period. (2) Stage 2: Virtual group formation. (ii) A designated virtual group representative must submit an election, on behalf of the solo practitioners and groups that compose a virtual group, to participate in MIPS as a virtual group for a performance period in a form and manner specified by CMS by the election deadline specified in paragraph (b) of this section. The virtual group election must include each TIN and NPI associated with the virtual group and contact information for the virtual group representative. (iii) After an election is made, the virtual group representative must contact their designated CMS contact to update any election information that changed during a performance period at least one time prior to the start of data submission. (3) Virtual group agreement. (i) Identifies each party by name, TIN, and each NPI under the TIN, and includes as parties only the solo practitioners and groups that compose the virtual group. (ii) Is for a term of at least one performance period. (iii) Requires each party to notify each NPI under the party's TIN regarding their participation in the MIPS as a virtual group. (iv) Sets forth each NPI's rights and obligations in, and representation by, the virtual group, including, but not limited to, the reporting requirements and how participation in the MIPS as a virtual group affects the NPI's ability to participate in the MIPS outside of the virtual group. (v) Describes how the opportunity to receive payment adjustments will encourage each member of the virtual group (and each NPI under each TIN in the virtual group) to adhere to quality assurance and improvement. (vi) Requires each party to update its Medicare enrollment information, including the addition or removal of NPIs billing under its TIN, on a timely basis in accordance with Medicare program requirements and to notify the other parties of any such changes within 30 days of the change. (vii) Requires completion of a close-out process upon termination or expiration of the agreement that requires each party to furnish all data necessary for the parties to aggregate their data across the virtual group's TINs. (viii) Expressly requires each party to participate in the MIPS as a virtual group and comply with the requirements of the MIPS and all other applicable laws (including, but not limited to, Federal criminal law, the Federal False Claims Act, the Federal anti-kickback statute, the Federal civil monetary penalties law, the Federal physician self-referral law, and the Health Insurance Portability and Accountability Act of 1996). (ix) Is executed on behalf of each party by an individual who is authorized to bind the party. (d) Virtual group reporting requirements. (1) Virtual groups must meet the definition of a virtual group at all times during the applicable performance period. (2) Solo practitioners and groups of 10 or fewer eligible clinicians that elect to participate in MIPS as a virtual group must aggregate their performance data across the virtual group's TINs, and for the Promoting Interoperability performance category, must aggregate the performance data of all of the MIPS eligible clinicians in the virtual group's TINs for whom the virtual group has data in CEHRT. (3) Solo practitioners and groups of 10 or fewer eligible clinicians that elect to participate in MIPS as a virtual group will have their performance assessed at the virtual group level across all four MIPS performance categories. (4) Virtual groups must adhere to the election process described in paragraph (c) of this section. [83 FR 60077, Nov. 23, 2018, as amended at 84 FR 63195, Nov. 15, 2019] § 414.1317 APM Entity groups. (a) APM entity group determination. (1) In addition to the dates set forth in § 414.1425(b)(1), for purposes of MIPS, the APM Entity group includes an eligible clinician who is on a Participation List on December 31 of the MIPS performance period. (2) For purposes of MIPS scoring, the APM Entity group will be comprised only of those eligible clinicians within the APM Entity group who are determined to be MIPS eligible at the individual or group level. (3) For purposes of calculating the APM Entity group score, MIPS scores submitted by virtual groups will not be included. (b) APM Entity group scoring. (1) Determination of performance category score for each MIPS eligible clinician in an APM Entity. (i) A group score based on the measure data for the performance category reported by a TIN for the MIPS eligible clinician according to MIPS submission and reporting requirements for groups. (ii) An individual score based on the measure data for the performance category reported by the MIPS eligible clinician according to MIPS submission and reporting requirements for individuals. (iii) In the event that a MIPS eligible clinician in an APM Entity receives an exception from the reporting requirements, such eligible clinician will be assigned a null score when CMS calculates the APM Entity's performance category score. (2) Performance category weights. (3) Improvement scoring for APM Entity groups. (4) Extreme and uncontrollable circumstances. 6 (i) An APM Entity must demonstrate in its application to CMS that greater than 75 percent of its participant MIPS eligible clinicians would be eligible for reweighting the Promoting Interoperability performance category for the applicable performance period. (ii) If CMS approves the request for reweighting based on an APM Entity's application, and if MIPS data are submitted for the APM Entity for the applicable performance period, all four of the MIPS performance categories will be reweighted for the APM Entity group notwithstanding the data submission. [85 FR 85030, Dec. 28, 2020, as amended at 86 FR 65671, Nov. 19, 2021] § 414.1318 Subgroups. (a) Eligibility and special status General. (2) Exclusions. (3) Single subgroup per eligible clinician. (4) Subgroup determination period. (b) Final score. (1) CMS will not assign a final score for a subgroup that registers and does not submit data as a subgroup for the applicable performance period. (2) [Reserved] (c) Subgroup reporting requirements. (1) Individual eligible clinicians that elect to participate in MIPS as a subgroup must aggregate their quality and improvement activities performance data across the subgroup's identifier. (2) Individual eligible clinicians that elect to participate in MIPS as a subgroup will have their performance assessed at the subgroup level across all the MIPS performance categories based on an MVP in accordance with § 414.1365. Subgroups that are MVP Participants must adhere to an election process described in § 414.1365(b). [86 FR 65671, Nov. 19, 2021; as amended at 87 FR 70227, Nov. 18, 2022] § 414.1320 MIPS performance period. (a) For purposes of the 2019 MIPS payment year, the performance period for all performance categories and submission mechanisms except for the cost performance category and data for the quality performance category reported through the CMS Web Interface, for the CAHPS for MIPS survey, and for the all-cause hospital readmission measure, is a minimum of a continuous 90-day period within CY 2017, up to and including the full CY 2017 (January 1, 2017 through December 31, 2017). For purposes of the 2019 MIPS payment year, for data reported through the CMS Web Interface or the CAHPS for MIPS survey and administrative claims-based cost and quality measures, the performance period under MIPS is CY 2017 (January 1, 2017 through December 31, 2017). (b) For purposes of the 2020 MIPS payment year, the performance period for: (1) The quality and cost performance categories is CY 2018 (January 1, 2018 through December 31, 2018). (2) Promoting Interoperability and improvement activities performance categories is a minimum of a continuous 90-day period within CY 2018, up to and including the full CY 2018 (January 1, 2018 through December 31, 2018). (c) For purposes of the 2021 MIPS payment year, the performance period for: (1) The quality and cost performance categories is CY 2019 (January 1, 2019 through December 31, 2019). (2) Promoting Interoperability and improvement activities performance categories is a minimum of a continuous 90-day period within CY 2019, up to and including the full CY 2019 (January 1, 2019 through December 31, 2019). (d) For purposes of the CY 2020 performance period/2022 MIPS payment year, the performance period for: (1) The quality and cost performance categories are the full calendar year (January 1 through December 31) that occurs 2 years prior to the applicable MIPS payment year. (2) The improvement activities performance categories are a minimum of a continuous 90-day period within the calendar year that occurs 2 years prior to the applicable MIPS payment year, up to and including the full calendar year. (e) Beginning with the 2023 MIPS payment year, the performance period for: (1) The quality and cost performance categories is the full calendar year (January 1 through December 31) that occurs 2 years prior to the applicable MIPS payment year, except as otherwise specified for administrative claims-based measures in the MIPS final list of quality measures described in § 414.1330(a)(1). (2) The improvement activities performance categories is a minimum of a continuous 90-day period within the calendar year that occurs 2 years prior to the applicable MIPS payment year, up to and including the full calendar year. (f) For purposes of the 2022 MIPS payment year, the performance period for: (1) The Promoting Interoperability performance category is a minimum of a continuous 90-day period within the calendar year that occurs 2 years prior to the applicable MIPS payment year, up to and including the full calendar year. (2) [Reserved] (g) For purposes of the 2023 MIPS payment year, the performance period for: (1) The Promoting Interoperability performance category is a minimum of a continuous 90-day period within the calendar year that occurs 2 years prior to the applicable MIPS payment year, up to and including the full calendar year. (2) [Reserved] (h) For purposes of the 2024 MIPS payment year and the 2025 MIPS payment year, the performance period for: (1) The Promoting Interoperability performance category is a minimum of a continuous 90-day period within the calendar year that occurs 2 years prior to the applicable MIPS payment year, up to and including the full calendar year. (2) [Reserved] (i) For purposes of the 2026 MIPS payment year and each subsequent payment year, the performance period for: (1) The Promoting Interoperability performance category is a minimum of a continuous 180-day period within the calendar year that occurs 2 years prior to the applicable MIPS payment year, up to and including the full calendar year. (2) [Reserved] [81 FR 77537, Nov. 4, 2016, as amended at 82 FR 53953, Nov. 16, 2017; 83 FR 60078, Nov. 23, 2018; 84 FR 63195, Nov. 15, 2019; 85 FR 85030, Dec. 28, 2020; 86 FR 65671, Nov. 19, 2021; 88 FR 79534, Nov. 16, 2023] § 414.1325 Data submission requirements. (a) Applicable performance categories. (i) For the quality performance category, a data submission must include numerator and denominator data for at least one MIPS quality measure from the final list of MIPS quality measures. (ii) For the improvement activities performance category, a data submission must include a response of “yes” for at least one activity in the MIPS improvement activities inventory. (iii) For the Promoting Interoperability performance category, a data submission must include all of the following elements: (A) Performance data, including any claim of an applicable exclusion, for the measures in each objective, as specified by CMS; (B) Required attestation statements, as specified by CMS; (C) CMS EHR Certification ID (CEHRT ID) from the Certified Health IT Product List (CHPL); and (D) The start date and end date for the applicable performance period as set forth in § 414.1320. (2) There are no data submission requirements for: (i) The cost performance category or administrative claims-based quality measures. Performance in the cost performance category and on such measures is calculated by CMS using administrative claims data, which includes claims submitted with dates of service during the applicable performance period that are processed no later than 60 days following the close of the applicable performance period. (ii) The quality and cost performance categories, as applicable, for MIPS eligible clinicians and groups that are scored under the facility-based measurement scoring methodology described in § 414.1380(e). (b) Data submission types for individual MIPS eligible clinicians. (1) For the quality performance category, the direct, login and upload, and Medicare Part B claims (beginning with the 2021 MIPS payment year for small practices only) submission types. (2) For the improvement activities or Promoting Interoperability performance categories, the direct, login and upload, or login and attest submission types. (c) Data submission types for groups, virtual groups, subgroups, and APM Entities. (1) For the quality performance category, the direct; login and upload; Medicare Part B claims (beginning with the CY 2019 MIPS performance period/2021 MIPS payment year, for small practices only); and CMS Web Interface (for groups consisting of 25 or more eligible clinicians, a third party intermediary submitting on behalf of a group) submission type. (2) For the improvement activities or Promoting Interoperability performance categories, the direct, login and upload, or login and attest submission types. (d) Use of multiple data submission types. (e) Data submission deadlines. (1) For the direct, login and upload, login and attest, and CMS Web Interface submission types, March 31 following the close of the applicable performance period or a later date as specified by CMS. (2) For the Medicare Part B claims submission type, data must be submitted on claims with dates of service during the applicable performance period that must be processed no later than 60 days following the close of the applicable performance period. (f) Treatment of multiple data submissions. (2) For multiple data submissions received for the Promoting Interoperability performance category, CMS will calculate a score for each data submission received and assign the highest of the scores. [83 FR 60078, Nov. 23, 2018, as amended at 85 FR 85031, Dec. 28, 2020; 86 FR 65671, Nov. 19, 2021; 88 FR 79534, Nov. 16, 2023; 89 FR 98560, Dec. 9, 2024] § 414.1330 Quality performance category. (a) For a MIPS payment year, CMS uses the following quality measures, as applicable, to assess performance in the quality performance category: (1) Measures included in the MIPS final list of quality measures established by CMS through rulemaking; (2) QCDR measures approved by CMS under § 414.1400; (3) Facility-based measures described in § 414.1380; and (4) MIPS APM measures described in § 414.1370. (b) Unless a different scoring weight is assigned by CMS, performance in the quality performance category comprises: (1) 60 percent of a MIPS eligible clinician's final score for MIPS payment year 2019. (2) 50 percent of a MIPS eligible clinician's final score for MIPS payment year 2020. (3) 45 percent of a MIPS eligible clinician's final score for MIPS payment years 2021 and 2022. (4) 40 percent of a MIPS eligible clinician's final score for the MIPS payment year 2023. (5) 30 percent of a MIPS eligible clinician's final score for the MIPS payment year 2024 and future years. (c)(1) CMS uses the following criteria to determine the removal of a quality measure: (i) If the Secretary determines that the quality measure is no longer meaningful, such as measures that are topped out. (ii) If a measure steward is no longer able to maintain the quality measure. (iii) If the quality measure reached extremely topped out status. (iv) If the quality measure does not meet case minimum and reporting volumes required for benchmarking after being in the program for 2 consecutive CY performance periods. (v) If the quality measure is duplicative. (vi) If the quality measure is not updated to reflect current clinical guidelines, which are not reflective of a clinician's scope of practice. (vii) If the quality measure is a process measure. (viii) If the quality measure addresses a measurement gap. (ix) If the quality measure is a patient-reported outcome. (x) If the quality measure is not available for MIPS quality reporting by or on behalf of all MIPS eligible clinicians. (xi) The robustness of the quality measure. (xii) Consideration of the quality measure in developing MIPS Value Pathways (MVPs). (2) A quality measure that otherwise meets the criteria for removal in paragraph (c)(1) of this section may nonetheless be retained based on the following considerations: (i) Whether the removal of the process measure impacts the number of measures available for a specific specialty. (ii) Whether the quality measure addresses a priority area. (iii) Whether the quality measure promotes positive outcomes in patients. (iv) Whether the quality measure is designated as high priority or not. (v) Whether the quality measure has reached extremely topped out status. (vi) Evaluation of the quality measure's performance data. [83 FR 60078, Nov. 23, 2018, as amended at 84 FR 63195, Nov. 15, 2019; 85 FR 85031, Dec. 28, 2020; 89 FR 98561, Dec. 9, 2024] § 414.1335 Data submission criteria for the quality performance category. (a) Criteria. (1) For Medicare Part B claims measures, MIPS CQMs, eCQMs, or QCDR measures. (A) For eCQMs, the submission of data requires the utilization of CEHRT, as defined at § 414.1305. (B) [Reserved] (ii) A MIPS eligible clinician, group, virtual group, and APM Entity that report on a specialty or subspecialty measure set, as designated in the MIPS final list of quality measures established by CMS through rulemaking, must submit data on at least six measures within that set, including at least one outcome measure. If an applicable outcome measure is not available, report one other high priority measure. If the set contains fewer than six measures or if fewer than six measures within the set apply to the MIPS eligible clinician, group, virtual group, or APM Entity, report on each measure that is applicable. (A) For eCQMs, the submission of data requires the utilization of CEHRT, as defined at § 414.1305. (B) [Reserved] (2) For CMS Web Interface measures. (ii) [Reserved] (3) For the CAHPS for MIPS survey measure. (ii) [Reserved] (4) For Medicare CQMs. (ii) [Reserved] (b) Special rule for the APM Performance Pathway (APP) Plus measure set. [81 FR 77537, Nov. 4, 2016, as amended at 82 FR 53953, Nov. 16, 2017; 83 FR 60079, Nov. 23, 2018; 84 FR 63195, Nov. 15, 2019; 88 FR 79534, Nov. 16, 2023; 89 FR 98561, Dec. 9, 2024] § 414.1340 Data completeness criteria for the quality performance category. (a) MIPS eligible clinicians, groups, virtual groups, subgroups, and APM Entities submitting quality measures data on QCDR measures, MIPS CQMs, or eCQMs must submit data on: (1) At least 50 percent of the MIPS eligible clinician or group's patients that meet the measure's denominator criteria, regardless of payer for MIPS payment year 2019. (2) At least 60 percent of the MIPS eligible clinician, group, and virtual group's patients that meet the measure's denominator criteria, regardless of payer for MIPS payment years 2020 and 2021. (3) At least 70 percent of the MIPS eligible clinician, group, and virtual group's patients that meet the measure's denominator criteria, regardless of payer for MIPS payment years 2022, 2023, 2024, and 2025. (i) Applicable to an APM Entity for MIPS payment years 2023, 2024, and 2025. (ii) Applicable to a subgroup for MIPS payment year 2025. (4) At least 75 percent of the MIPS eligible clinician, group, virtual group, subgroup, and APM Entity's patients that meet the measure's denominator criteria, regardless of payer for MIPS payment years 2026, 2027, 2028, 2029, and 2030. (b) MIPS eligible clinicians, groups, virtual groups, subgroups, and APM Entities submitting quality measure data on Medicare Part B claims measures must submit data on: (1) At least 50 percent of the applicable Medicare Part B patients seen during the performance period to which the measure applies for MIPS payment years 2019. (2) At least 60 percent of the applicable Medicare Part B patients seen during the performance period to which the measure applies for MIPS payment years 2020 and 2021. (i) Applicable to virtual groups starting with MIPS payment year 2020. (ii) [Reserved] (3) At least 70 percent of the applicable Medicare Part B patients seen during the performance period to which the measure applies for MIPS payment years 2022, 2023, 2024, and 2025. (i) Applicable to APM Entities starting with MIPS payment year 2023 and subgroups starting with MIPS payment year 2025. (ii) [Reserved]. (4) At least 75 percent of the applicable Medicare Part B patients seen during the performance period to which the measure applies for MIPS payment years 2026, 2027, 2028, 2029, and 2030. (c) Groups submitting quality measures data on CMS Web Interface measures or the CAHPS for MIPS survey must submit data on the sample of the Medicare Part B patients CMS provides, as applicable. (1) For CMS Web Interface measures. (ii) [Reserved] (2) [Reserved] (d) APM Entities, specifically Medicare Shared Savings Program Accountable Care Organizations that meet reporting requirements under the APP, submitting quality measure data on Medicare CQMs must submit data on: (1) At least 75 percent of the applicable beneficiaries eligible for the Medicare CQM, as defined at § 425.20 of this chapter, who meet the measure's denominator criteria for MIPS payment years 2026, 2027, 2028, 2029, and 2030. (2) [Reserved] (e) If quality data are submitted selectively such that the submitted data are unrepresentative of a MIPS eligible clinician, group, virtual group, subgroup, or APM Entity's performance, any such data would not be true, accurate, or complete for purposes of § 414.1390(b) or § 414.1400(a)(5). [81 FR 77537, Nov. 4, 2016, as amended at 82 FR 53953, Nov. 16, 2017; 83 FR 60079, Nov. 23, 2018; 84 FR 63195, Nov. 15, 2019; 86 FR 65671, Nov. 19, 2021; 87 FR 70227, Nov. 18, 2022; 88 FR 79534, Nov. 16, 2023; 89 FR 98561, Dec. 9, 2024] § 414.1350 Cost performance category. (a) Specification of cost measures. (b) Attribution. (2) For the total per capita cost measure specified for the 2017 through 2019 performance periods, beneficiaries are attributed using a method generally consistent with the method of assignment of beneficiaries under § 425.402 of this chapter. (3) For the Medicare Spending per Beneficiary clinician (MSPB clinician) measure specified for the 2017 through 2019 performance periods, an episode is attributed to the MIPS eligible clinician who submitted the plurality of claims (as measured by allowed charges) for Medicare Part B services rendered during an inpatient hospitalization that is an index admission for the MSPB clinician measure during the applicable performance period. (4) For the acute condition episode-based measures specified for the 2017 performance period, an episode is attributed to each MIPS eligible clinician who bills at least 30 percent of inpatient evaluation and management (E/M) visits during the trigger event for the episode. (5) For the procedural episode-based measures specified for the 2017 performance period, an episode is attributed to each MIPS eligible clinician who bills a Medicare Part B claim with a trigger code during the trigger event for the episode. (6) For the acute inpatient medical condition episode-based measures specified for the 2019 performance period, an episode is attributed to each MIPS eligible clinician who bills inpatient E/M claim lines during a trigger inpatient hospitalization under a TIN that renders at least 30 percent of the inpatient E/M claim lines in that hospitalization. (7) For the procedural episode-based measures specified for the 2019 performance period, an episode is attributed to each MIPS eligible clinician who renders a trigger service as identified by HCPCS/CPT procedure codes. (8) Beginning with the 2020 performance period, each cost measure is attributed according to the measure specifications for the applicable performance period. (c) Case minimums. (2) For the Medicare spending per beneficiary clinician measure, the case minimum is 35. (3) For the episode-based measures specified for the 2017 performance period, the case minimum is 20. (4) For the procedural episode-based measures specified beginning with and after the CY 2019 performance period/2021 MIPS payment year, the case minimum is 10, unless otherwise specified for individual measures. Beginning with the CY 2022 performance period/2024 MIPS payment year, the case minimum for Colon and Rectal Resection procedural episode-based measure is 20 episodes. (5) For the acute inpatient medical condition episode-based measures specified beginning with and after CY 2019 performance period/2021 MIPS payment year, the case minimum is 20, unless otherwise specified for individual measures. (6) For the chronic condition episode-based measures specified beginning with and after the CY 2022 performance period/2024 MIPS payment year, the case minimum is 20, unless otherwise specified for individual measures. (7) For the care setting episode-based measures specified beginning with and after the CY 2024 performance period/2026 MIPS payment year, the case minimum is 20, unless otherwise specified for individual measures. (d) Scoring weight. (1) Zero percent of a MIPS eligible clinician's final score for MIPS payment year 2019. (2) 10 percent of a MIPS eligible clinician's final score for MIPS payment year 2020. (3) 15 percent of a MIPS eligible clinician's final score for MIPS payment years 2021 and 2022. (4) 20 percent of the MIPS final score for MIPS payment year 2023. (5) 30 percent of the MIPS final score for MIPS payment year 2024 and each subsequent MIPS payment year. (e) Cost measure removal criteria. (1) It is not feasible to implement the measure specifications. (2) A measure steward is no longer able to maintain the cost measure. (3) The implementation costs or negative unintended consequences associated with a cost measure outweigh the benefit of its continued use in the MIPS cost performance category. (4) The measure specifications do not reflect current clinical practice or guidelines. (5) The availability of a more applicable measure, including a measure that applies across settings, applies across populations, or is more proximal in time to desired patient outcomes for the particular topic. [83 FR 60079, Nov. 23, 2018, as amended at 84 FR 63195, Nov. 15, 2019, 85 FR 85031, Dec. 28, 2020; 86 FR 65671, Nov. 19, 2021; 88 FR 79535, Nov. 16, 2023; 89 FR 98561, Dec. 9, 2024] § 414.1355 Improvement activities performance category. (a) For a MIPS payment year, CMS uses improvement activities included in the MIPS final inventory of improvement activities established by CMS through rulemaking to assess performance in the improvement activities performance category. (b) Unless a different scoring weight is assigned by CMS under section 1848(q)(5)(F) of the Act, performance in the improvement activities performance category comprises: (1) 15 percent of a MIPS eligible clinician's final score for MIPS payment year 2019 and for each MIPS payment year thereafter. (2) [Reserved] (c) The following are the list of subcategories, of which, with the exception of Participation in an APM, include activities for selection by a MIPS eligible clinician or group: (1) Expanded practice access, such as same day appointments for urgent needs and after-hours access to clinician advice. (2) Population management, such as monitoring health conditions of individuals to provide timely health care interventions or participation in a QCDR. (3) Care coordination, such as timely communication of test results, timely exchange of clinical information to patients or other clinicians, and use of remote monitoring or telehealth. (4) Beneficiary engagement, such as the establishment of care plans for individuals with complex care needs, beneficiary self-management assessment and training, and using shared decision making mechanisms. (5) Patient safety and practice assessment, such as through the use of clinical or surgical checklists and practice assessments related to maintaining certification. (6) Participation in an APM. (7) Advancing health and wellness, such as MIPS eligible clinicians demonstrating involvement in preventive care and health promotion. (8) Emergency preparedness and response, such as measuring MIPS eligible clinician participation in the Medical Reserve Corps, measuring registration in the Emergency System for Advance Registration of Volunteer Health Professionals, measuring relevant reserve and active duty uniformed services MIPS eligible clinician activities, and measuring MIPS eligible clinician volunteer participation in domestic or international humanitarian medical relief work. (9) Integrated behavioral and mental health, such as measuring or evaluating such practices as: Co-location of behavioral health and primary care services; shared/integrated behavioral health and primary care records; cross training of MIPS eligible clinicians, and integrating behavioral health with primary care to address substance use disorders or other behavioral health conditions, as well as integrating mental health with primary care. (d) CMS may remove an improvement activity from MIPS based on one or more of the following factors, provided however CMS may retain an improvement activity that meets one or more of the following factors if CMS determines the benefit of retaining the activity outweighs the benefit of removing it: (1) Factor 1: (2) Factor 2: (3) Factor 3: (4) Factor 4: (5) Factor 5: (6) Factor 6: (7) Factor 7: [81 FR 77537, Nov. 4, 2016, as amended at 83 FR 60079, Nov. 23, 2018; 89 FR 98561, Dec. 9, 2024; 90 FR 50010, Nov. 5, 2025] § 414.1360 Data submission criteria for the improvement activities performance category. (a) For purposes of the transition year of MIPS and future years, MIPS eligible clinicians, subgroups, or groups must submit data on MIPS improvement activities in one of the following manners: (1) Via direct, login and upload, and login and attest. (i) Submit a yes response for activities within the improvement activities inventory. (ii) [Reserved] (2) Groups and virtual groups. (b) [Reserved] [81 FR 77537, Nov. 4, 2016, as amended at 82 FR 53953, Nov. 16, 2017; 83 FR 60080, Nov. 23, 2018; 84 FR 63196, Nov. 15, 2019; 86 FR 65671, Nov. 19, 2021; 88 FR 79535, Nov. 16, 2023] § 414.1365 MIPS Value Pathways. (a) General. (2) [Reserved] (b) MVP/Subgroup registration. (2) At the time of registration, the MVP Participant must submit the following information, as applicable: (i) For the CY 2023 through 2024 performance periods/2025 through 2026 MIPS payment years, each MVP Participant must select an MVP, one population health measure included in the MVP, and any outcomes-based administrative claims measure on which the MVP Participant intends to be scored. Beginning in the CY 2025 performance period/2027 MIPS payment year, each MVP Participant must select an MVP and any outcomes-based administrative claims measure on which the MVP Participant intends to be scored. (ii) Each subgroup must submit a list of each TIN/NPI associated with the subgroup and a plain language name for the subgroup. (iii) TINs must provide a description of each subgroup that is registered. (iv) Self-attestation requirement. (c) MVP reporting requirement (i) Paragraph (c)(1) introductory text of this section does not apply to a small practice that reports on an MVP that includes fewer than 4 Medicare Part B claims measures, provided that the small practice reports each such measure that is applicable. (ii) [Reserved] (2) Cost. (3) Improvement activities. (i) For the CY 2023 and 2024 performance periods/2025 through 2026 MIPS payment years: (A) Two medium-weighted improvement activities. (B) One high-weighted improvement activity. (C) Participation in a certified or recognized patient-centered medical home (PCMH) or comparable specialty practice, as described at § 414.1380(b)(3)(ii). (ii) Beginning in the CY 2025 performance period/2027 MIPS payment year: (A) One improvement activity. (B) Participation in a certified or recognized patient-centered medical home (PCMH) or comparable specialty practice, as described at § 414.1380(b)(3)(ii). (iii) Participation in a certified or recognized patient-centered medical home (PCMH) or comparable specialty practice, as described at § 414.1380(b)(3)(ii). (4) Foundational layer (A) An MVP Participant that is a subgroup is required to submit its affiliated group's data for the Promoting Interoperability performance category. (B) [Reserved] (ii) Population health measures. (d) MVP scoring (2) Performance standards. (3) Performance categories. (i) Quality performance category. (A) Population health measures. 1 1 ( 1 ( 2 (B) Outcomes-based administrative claims measures. ( 1 ( 2 (ii) Cost performance category. (A) A subgroup is scored on each cost measure included in the MVP that it selects and reports based on its affiliated group score for each such measure, if available. If the subgroup's affiliated group score is not available for a measure, the measure is excluded from the subgroup's total measure achievement points and total available measure achievement points, as described under § 414.1380(b)(2). (B) [Reserved] (iii) Improvement activities performance category. (iv) Promoting interoperability performance category. (A) If a subgroup does not submit its affiliated group's data for the Promoting Interoperability performance category, the subgroup will receive a score of zero for the Promoting Interoperability performance category. (B) [Reserved] (e) Final score calculation. (1) MVP performance category weights. (2) Reweighting MVP performance categories General reweighting. (ii) Subgroups. (A) A subgroup may submit an application to CMS demonstrating that it was subject to extreme and uncontrollable circumstances and receive reweighting in accordance with § 414.1380(c)(2)(i)(A)(6) and (c)(2)(i)(C)(2). In the event that a subgroup submits data for a performance category, the scoring weight described at § 414.1380(c)(1) would be applied and its weight would not be redistributed. (B) A subgroup will receive reweighting if CMS determines, based on information known to the agency prior to the beginning of the relevant MIPS payment year, that data for the subgroup are inaccurate, unusable or otherwise compromised due to circumstances outside of the control of the subgroup and its agents, in accordance with § 414.1380(c)(2)(i)(A)(9) and (c)(2)(i)(C)(10). (iii) Reweighting scenarios. (3) Facility-based scoring. (4) Complex patient bonus. (i) For subgroups, the affiliated group's complex patient bonus will be added to the final score. (ii) [Reserved] [86 FR 65671, Nov. 19, 2021, as amended at 87 FR 70227, Nov. 18, 2022; 88 FR 79535, Nov. 16, 2023; 89 FR 98562, Dec. 9, 2024; 90 FR 50010, Nov. 5, 2025] § 414.1367 APM performance pathway. (a) General. (b) Criteria for MIPS APMs. (1) APM Entities participate in the APM under an agreement with CMS or through a law or regulation; and (2) The APM bases payment on quality measures and cost/utilization. (c) MIPS performance category scoring in the APM Performance Pathway Quality. (i) Each submitted measure that does not have a benchmark or meet the case minimum requirement is excluded from the MIPS eligible clinician, group, or APM Entity group's total measure achievement points and total available measure achievement points. (ii) Any measure that is identified as topped out is not subject to the scoring cap described at § 414.1380(b)(1)(iv). (iii)(A) For performance periods beginning prior to CY 2025 and MIPS payment years beginning prior to 2027, a MIPS eligible clinician, group, or APM Entity group must report the APM Performance Pathway quality measure set. (B) Beginning with the CY 2025 performance period/2027 MIPS payment year, a MIPS eligible clinician, group, or APM Entity group may choose to report either the APM Performance Pathway quality measure set or the APP Plus quality measure set. (2) Cost. (3) Improvement activities. (4) Promoting interoperability. (d) APM Performance Pathway performance category weights Performance category weights. (i) Quality: 50 percent. (ii) Cost: 0 percent. (iii) Improvement Activities: 20 percent. (iv) Promoting Interoperability: 30 percent. (2) Reweighting MIPS performance categories. (i) If CMS reweights the quality performance category to 0 percent: Promoting Interoperability performance category is reweighted to 75 percent, and Improvement Activities performance category is reweighted to 25 percent. (ii) If CMS reweights the Promoting Interoperability performance category to 0 percent: Quality performance category is reweighted to 75 percent, and Improvement Activities performance category is reweighted to 25 percent. (e) Final score. [85 FR 85031, Dec. 28, 2020, as amended at 89 FR 98562, Dec. 9, 2024] § 414.1370 APM scoring standard under MIPS. (a) General. (b) Criteria for MIPS APMs. (1) APM Entities participate in the APM under an agreement with CMS or through a law or regulation; (2) The APM is designed such that APM Entities participating in the APM include at least one MIPS eligible clinician on a Participation List; (3) The APM bases payment on quality measures and cost/utilization; and (4) The APM is not either of the following: (i) New APMs. (ii) APM in final year of operation for which the APM scoring standard is impracticable. (c) APM scoring standard performance period. (d) APM participant identifier. (1) APM identifier (established for the APM by CMS); (2) APM Entity identifier (established for the APM Entity by CMS); (3) Medicare-enrolled billing TIN; and (4) Eligible clinician NPI. (e) APM Entity group determination. (1) Full TIN APM. (2) For purposes of calculating the APM Entity group score under the APM scoring standard, MIPS scores submitted by virtual groups will not be included. (f) APM Entity group scoring under the APM scoring standard. (1) If a Shared Savings Program ACO does not report data on quality measures as required by the Shared Savings Program under § 425.508 of this chapter, each ACO participant TIN will be treated as a unique APM Entity for purposes of the APM scoring standard and the ACO participant TINs may report data for the MIPS quality performance category according to the MIPS submission and reporting requirements. (2) MIPS eligible clinicians who participate in a group or have elected to participate in a virtual group and who are also on a MIPS APM Participation List will be included in the assessment under MIPS for purposes of producing a group or virtual group score and under the APM scoring standard for purposes of producing an APM Entity score. The MIPS payment adjustment for these eligible clinicians is based solely on their APM Entity score; if the APM Entity group is exempt from MIPS all eligible clinicians within that APM Entity group are also exempt from MIPS. (g) MIPS performance category scoring under the APM scoring standard Quality. (i) MIPS APMs that require APM Entities to submit quality data through a MIPS submission mechanism. (ii) MIPS APMs that do not require APM Entities to submit quality data through a MIPS submission mechanism. (iii) Determination of score for each MIPS eligible clinician in an APM entity. (A) A TIN level score based on the measure data for the quality performance category reported by a TIN for the MIPS eligible clinician in accordance with § 414.1335; or (B) An individual level score based on the measure data for the quality performance category reported by the MIPS eligible clinician in accordance with § 414.1335. (iv) Quality improvement score. (2) Cost. (3) Improvement activities. (ii) [Reserved] (4) Promoting Interoperability. (ii) For the 2019 and 2020 MIPS payment years, for APM Entities in MIPS APMs other than the Shared Savings Program, CMS uses one score for each MIPS eligible clinician in the APM Entity group to derive a single average APM Entity score for the Promoting Interoperability performance category. Beginning with the 2021 MIPS payment year, for APM Entities in MIPS APMs including the Shared Savings Program, CMS uses one score for each MIPS eligible clinician in the APM Entity group to derive a single average APM Entity score for the Promoting Interoperability performance category. The score for each MIPS eligible clinician is the higher of either: (A) A group score based on the measure data for the Promoting Interoperability performance category reported by a TIN for the MIPS eligible clinician according to MIPS submission and reporting requirements for groups; or (B) An individual score based on the measure data for the Promoting Interoperability performance category reported by the MIPS eligible clinician according to MIPS submission and reporting requirements for individuals. (iii) In the event that a MIPS eligible clinician participating in a MIPS APM receives an exception from the Promoting Interoperability performance category reporting requirements, such eligible clinician will be assigned a null score when CMS calculates the APM Entity's Promoting Interoperability performance category score under the APM scoring standard. (A) If all MIPS eligible clinicians in an APM Entity have been excepted from reporting the Promoting Interoperability performance category, the performance category weight will be reweighted to zero for the APM Entity for that MIPS performance period. (B) [Reserved] (h) APM scoring standard performance category weights. (1) Quality. (ii) For Other MIPS APMs, 0 percent for 2017, 50 percent beginning in 2018. (2) Cost. (3) Improvement activities. (ii) For Other MIPS APMs, 25 percent for 2017, 20 percent beginning in 2018. (4) Promoting Interoperability. (ii) For Other MIPS APMs, 25 percent for 2017, 30 percent beginning in 2018. (5) Reweighting the MIPS Performance categories for the APM scoring standard. (i) If CMS reweights the quality performance category to 0 percent: (A) In 2017, the improvement activities performance category is reweighted to 25 percent and the Promoting Interoperability performance category is reweighted to 75 percent; and (B) Beginning in 2018, the Promoting Interoperability performance category is reweighted to 75 percent and the improvement activities performance category is reweighted to 25 percent. (ii) If CMS reweights the Promoting Interoperability performance category to zero percent: (A) In 2017, the quality performance category is reweighted to 75 percent and the improvement activities performance category will remain at 25 percent. (B) Beginning in 2018, the quality performance category is reweighted to 80 percent and the improvement activities performance category will remain at 20 percent. (i) Total APM Entity Score. [81 FR 77537, Nov. 4, 2016, as amended at 82 FR 53953, Nov. 16, 2017; 83 FR 23610, May 22, 2018; 83 FR 60080, Nov. 23, 2018; 84 FR 63196, Nov. 15, 2019; 85 FR 85031, Dec. 28, 2020] § 414.1375 Promoting Interoperability (PI) performance category. (a) Final score. (b) Reporting for the Promoting Interoperability performance category. (1) CEHRT. (2) Report MIPS—Promoting Interoperability objectives and measures. (i) For the 2019 and 2020 MIPS payment years: For each base score measure, as applicable, report the numerator (of at least one) and denominator, or yes/no statement, or claim an exclusion for each measure that includes an option for an exclusion; and (ii) Beginning with the 2021 MIPS payment year: (A) Report that the MIPS eligible clinician completed the actions included in the Security Risk Analysis measure during the year in which the performance period occurs; (B) For each required measure, as applicable, report the numerator (of at least one) and denominator, or yes/no statement, or an exclusion for each measure that includes an option for an exclusion; and (C) Beginning with the 2024 MIPS payment year through the 2025 MIPS payment year, submit an attestation, with either an affirmative or negative response, with respect to whether the MIPS eligible clinician completed the annual self-assessment under the SAFER Guides measure during the year in which the performance period occurs. (D) Beginning with the 2026 MIPS payment year, submit an affirmative attestation regarding the MIPS eligible clinician's completion of the annual self-assessment under the SAFER Guides measure during the year in which the performance period occurs. (3) Engaging in activities related to supporting providers with the performance of CEHRT; support for health information exchange and the prevention of information blocking; actions to limit or restrict the compatibility or interoperability of CEHRT Supporting providers with the performance of CEHRT (SPPC). (A) Must attest that he or she: ( 1 ( 2 (B) Optionally, may also attest that he or she: ( 1 ( 2 (ii) Support for health information exchange and the prevention of information blocking. (A) Did not knowingly and willfully take action (such as to disable functionality) to limit or restrict the compatibility or interoperability of certified EHR technology. (B) Implemented technologies, standards, policies, practices, and agreements reasonably calculated to ensure, to the greatest extent practicable and permitted by law, that the certified EHR technology was, at all relevant times— ( 1 ( 2 ( 3 ( 4 (C) Responded in good faith and in a timely manner to requests to retrieve or exchange electronic health information, including from patients, health care providers (as defined by 42 U.S.C. 300jj(3)), and other persons, regardless of the requestor's affiliation or technology vendor. (iii) Actions to limit or restrict the compatibility or interoperability of CEHRT. (A) Did not knowingly and willfully take action (such as to disable functionality) to limit or restrict the compatibility or interoperability of certified EHR technology. (B) [Reserved] [81 FR 77537, Nov. 4, 2016, as amended at 82 FR 53955, Nov. 16, 2017; 83 FR 60080, Nov. 23, 2018; 86 FR 65673, Nov. 19, 2021; 88 FR 79535, Nov. 16, 2023; 89 FR 54717, July 1, 2024] § 414.1380 Scoring. (a) General. (1) Performance standards. (ii) For the cost performance category, measures are scored between 1 and 10 points. Performance is measured against a benchmark. Beginning with the 2025 MIPS payment year, improvement scoring is available in the cost performance category. (iii) For the improvement activities performance category, each improvement activity is assigned a certain number of points. The points for all submitted activities are summed and scored against a total potential performance category score of 40 points. (iv) For the Promoting Interoperability performance category, each measure is scored against a maximum number of points. The points for all submitted measures are summed and scored against a total potential performance category score of 100 points. (2) [Reserved] (b) Performance categories. (1) Quality performance category Measure achievement points. (A) Lack of benchmark or case minimum. ( 1 2 3 ( 2 ( i ( ii ( 3 (B) Lack of complete data. 1 2 ( i ( ii ( iii ( 2 (C) New measures. (ii) Benchmarks. (A) Each benchmark must have a minimum of 20 individual clinicians or groups who reported the measure meeting the case minimum requirement at paragraph (b)(1)(iii) of this section and the data completeness requirement at § 414.1340 and having a performance rate that is greater than zero. (B) CMS Web Interface collection type uses benchmarks from the corresponding reporting year of the Shared Savings Program. (C) Beginning with the 2022 MIPS payment year, for each measure that has a benchmark that CMS determines may have the potential to result in inappropriate treatment, CMS will set benchmarks using a flat percentage for all collection types where the top decile is higher than 90 percent under the methodology at paragraph (b)(1)(ii) of this section. (D) Administrative claims-based quality measure benchmark. ( 1 ( 2 ( i ( ii (E) Beginning with the CY 2025 performance period/2027 MIPS payment year, CMS will publish a list in the Federal Register (F) Beginning in the CY 2025 performance period/2027 MIPS payment year, measures of the Medicare CQM collection type use flat benchmarks for their first two performance periods in MIPS. (iii) Minimum case requirements. (iv) Topped out measures. (A) For the 2020 MIPS payment year, each topped out measure specified by CMS through rulemaking receives no more than 7 measure achievement points, provided that the benchmark for the applicable collection type is identified as topped out in the benchmarks published for the 2018 MIPS performance period. (B) Beginning with the 2021 MIPS payment year, except as provided for in paragraph (b)(1)(iv)(C) of this section, each measure (except for measures in the CMS Web Interface) for which the benchmark for the applicable collection type is identified as topped out for 2 or more consecutive years receives no more than 7 measure achievement points in the second consecutive year it is identified as topped out, and beyond. (C) Beginning with the CY 2025 performance period/2027 MIPS payment year, measures impacted by limited measure choice as specified in paragraph (b)(1)(ii)(E) of this section are not subject to the 7 measure achievement point cap specified in paragraph (b)(1)(iv)(B) of this section. (v) Measure bonus points. (A) High priority measures. 1 (B) End-to-end electronic reporting. 1 ( 1 Limitations. i ( ii ( iii (C) Small practices. (vi) Improvement scoring. (A) Improvement scoring is available when the data sufficiency standard is met, which means when data are available and a MIPS eligible clinician has a quality performance category achievement percent score for the previous performance period and the current performance period. ( 1 ( 2 ( 3 ( 4 (B) The improvement percent score may not total more than 10 percentage points. (C) The improvement percent score is assessed at the performance category level for the quality performance category and included in the calculation of the quality performance category score as described in paragraph (b)(1)(vii) of this section. ( 1 ( 2 ( 3 ( 4 ( 5 (D) For the purpose of improvement scoring methodology, the term “quality performance category achievement percent score” means the total measure achievement points divided by the total available measure achievement points, without consideration of measure bonus points or improvement percent score. (E) For the purpose of improvement scoring methodology, the term “improvement percent score” means the score that represents improvement for the purposes of calculating the quality performance category score as described in paragraph (b)(1)(vii) of this section. (F) For the purpose of improvement scoring methodology, the term “fully participate” means the MIPS eligible clinician met all requirements in §§ 414.1335 and 414.1340. (vii) Quality performance category score. (A) For each measure that is submitted, if applicable, and impacted by significant changes or errors prior to the applicable data submission deadline at § 414.1325(e), performance is based on data for 9 consecutive months of the applicable CY performance period. If such data are not available or CMS determines that they may result in patient harm or misleading results, the measure is excluded from a MIPS eligible clinician's total measure achievement points and total available measure achievement points. For purposes of this paragraph (b)(1)(vii)(A), “significant changes or errors” means changes to or errors in a measure that are outside the control of the clinician and its agents and that CMS determines may result in patient harm or misleading results. Significant changes or errors include, but are not limited to, changes to codes (such as ICD-10, CPT, or HCPCS codes) or the active status of codes, the inadvertent omission of codes or inclusion of inactive or inaccurate codes, or changes to clinical guidelines or measure specifications. CMS will publish on the CMS website a list of all measures scored under this paragraph (b)(1)(vii)(A) as soon as technically feasible, but by no later than the data submission deadline at § 414.1325(e)(1). (B) Beginning with the 2021 MIPS payment year, for groups that submit 5 or fewer measures and register for the CAHPS for MIPS survey but do not meet the minimum beneficiary sampling requirements, the total available measure achievement points are reduced by 10 points. (C) Beginning in the CY 2025 performance period/2027 MIPS payment year, a Virtual Group and an APM Entity receives one measure achievement point for each eCQM submitted that meets the case minimum requirement at paragraph (b)(1)(iii) of this section and the data completeness requirement at § 414.1340. Each measure may not exceed 10 measure achievement points. The total adjustment to the Virtual Group or APM Entity's quality performance category score under this paragraph (b)(1)(vii)(C) may not exceed 10 percent of the total available measure achievement points. (2) Cost performance category. (i) Cost measure benchmarks are determined by CMS based on cost measure performance during the performance period. At least 20 MIPS eligible clinicians or groups must meet the minimum case volume specified under § 414.1350(c) for a cost measure in order for a benchmark to be determined for the measure. If a benchmark is not determined for a cost measure, the measure will not be scored. (A) For the 2019 through 2025 MIPS payment years, CMS determines cost measure benchmark ranges based on linear percentile distributions. (B) Beginning with the 2026 MIPS payment year, for each cost measure, CMS determines 10 benchmark ranges based on the median cost of all MIPS eligible clinicians attributed the measure, plus or minus standard deviations. CMS awards achievement points based on which benchmark range a MIPS eligible clinician's average cost for a cost measure corresponds. Additionally, CMS awards achievement points equivalent to 10 percent of the performance threshold for a MIPS eligible clinician whose average cost attributed under a cost measure is equal to the median cost for all MIPS eligible clinicians attributed the measure. (ii) A MIPS eligible clinician must meet the minimum case volume specified under § 414.1350(c) to be scored on a cost measure. (iii) Excluding cost measure scores calculated for informational-only purposes as provided in paragraph (b)(2)(vi) of this section, the cost performance category score is the sum of the following, not to exceed 100 percent: (A) The total number of achievement points earned by the MIPS eligible clinician divided by the total number of available achievement points; and (B) The cost improvement score, as determined under paragraph (b)(2)(iv) of this section. (iv) The cost improvement score is determined for a MIPS eligible clinician that demonstrates improvement in performance in the current MIPS performance period compared to their performance in the immediately preceding MIPS performance period. (A) The cost improvement score is determined at the category level for the cost performance category. (B) The cost improvement score is calculated only when data sufficient to measure improvement are available. Sufficient data are available when a MIPS eligible clinician or group participates in MIPS using the same identifier in 2 consecutive performance periods and is scored on the cost performance category for 2 consecutive performance periods. If the cost improvement score cannot be calculated because sufficient data are not available, then the cost improvement score is zero. (C) The cost improvement score is determined at the category-level by subtracting the cost performance category score from the previous performance period from the cost performance category score from the current performance period, then by dividing the difference by the cost performance category score from the previous performance period, and multiplying the result with the maximum available cost improvement score. (D) The cost improvement score cannot be lower than zero percentage points. (E) The maximum cost improvement score for the 2020, 2021, 2022, 2023, and 2024 MIPS payment year is zero percentage points. The maximum cost improvement score beginning with the 2025 MIPS payment year is 1 percentage point. (v) A cost performance category score is not calculated if a MIPS eligible clinician or group is not attributed any cost measures for the performance period because the clinician or group has not met the minimum case volume specified by CMS for any of the cost measures or a benchmark has not been created for any of the cost measures that would otherwise be attributed to the clinician or group. (A) Beginning with the 2024 MIPS payment year, if data used to calculate a score for a cost measure are impacted by significant changes during the performance period, such that calculating the cost measure score would lead to misleading or inaccurate results, then the affected cost measure is excluded from the MIPS eligible clinician's or group's cost performance category score. For purposes of this paragraph (b)(2)(v)(A), “significant changes” are changes external to the care provided, and that CMS determines may lead to misleading or inaccurate results. Significant changes include, but are not limited to, rapid or unprecedented changes to service utilization, and will be empirically assessed by CMS to determine the extent to which the changes impact the calculation of a cost measure score that reflects clinician performance. (B) Beginning with the 2026 MIPS payment year, if data used to calculate a score for a cost measure are impacted by significant changes or errors affecting the performance period, such that calculating the cost measure score would lead to misleading or inaccurate results, then the affected cost measure is excluded from the MIPS eligible clinician's or group's cost performance category score. For purposes of this paragraph (b)(2)(v)(B), “significant changes or errors” are changes or errors external to the care provided, and that CMS determines may lead to misleading or inaccurate results that negatively impact the measure's ability to reliably assess performance. Significant changes or errors include, but are not limited to, rapid or unprecedented changes to service utilization, the inadvertent omission of codes or inclusion of codes, or changes to clinical guidelines or measure specifications. CMS will empirically assess the affected cost measure to determine the extent to which the changes or errors impact the calculation of a cost measure score such that calculating the cost measure score would lead to misleading or inaccurate results that negatively impact the measure's ability to reliably assess performance. (vi) Beginning with the 2028 MIPS payment year, CMS calculates a score for each new cost measure in accordance with the scoring policy set forth in this paragraph (b)(2) for informational-only purposes during the measure's informational-only feedback period. (A) For the purposes of this paragraph (b)(2)(vi), the following terms have the following meanings. ( 1 New cost measure ( 2 Informational-only feedback period (B) During a new cost measure's informational-only feedback period, CMS does not include any scores for the new cost measure calculated for informational-only purposes under this paragraph (b)(2)(vi) in CMS's calculation of a MIPS eligible clinician's cost performance category score under paragraph (b)(2)(iii) of this section or a MIPS eligible clinician's MIPS final score under paragraph (c) of this section. (C) During a new cost measure's informational-only feedback period, CMS confidentially provides each MIPS eligible clinician their measure score under this paragraph (b)(2)(vi) for informational-only purposes. CMS also provides performance feedback to the MIPS eligible clinician in accordance with section 1848(q)(12) of the Act. (D) Upon completion of a new cost measure's informational-only feedback period, CMS includes its calculation of any scores for the cost measure in CMS's calculation of a MIPS eligible clinician's cost performance category score under paragraph (b)(2)(iii) of this section and a MIPS eligible clinician's MIPS final score under paragraph (c) of this section. (3) Improvement activities performance category. (i) For MIPS eligible clinicians participating in APMs, the improvement activities performance category score is at least 50 percent. MIPS eligible clinicians participating in APMs must attest to having completed an improvement activity or submit data for the quality and Promoting Interoperability performance categories in order to receive such credit. (ii) For MIPS eligible clinicians in a practice that is certified or recognized as a patient-centered medical home or comparable specialty practice, as determined by the Secretary, the improvement activities performance category score is 100 percent. For the 2019 MIPS payment year, at least one practice site within a group's TIN must be certified or recognized as a patient-centered medical home or comparable specialty practice. For the 2020 MIPS payment year and future years, at least 50 percent of the practice sites within a group's TIN must be recognized as a patient-centered medical home or comparable specialty practice. MIPS eligible clinicians that wish to claim this status for purposes of receiving full credit in the improvement activities performance category must attest to their status as a patient-centered medical home or comparable specialty practice in order to receive this credit. A practice is certified or recognized as a patient-centered medical home if it meets any of the following criteria: (A) The practice has received accreditation from an accreditation organization that is nationally recognized. (B) The practice is participating in a Medicaid Medical Home Model or Medical Home Model. (C) The practice is a comparable specialty practice that has received recognition through a specialty recognition program offered through a nationally recognized accreditation organization; or (D) The practice has received accreditation from other certifying bodies that have certified a large number of medical organizations and meet national guidelines, as determined by the Secretary. The Secretary must determine that these certifying bodies must have 500 or more certified member practices, and require practices to include the following: ( 1 ( 2 ( 3 ( 4 ( 5 (4) Promoting Interoperability performance category. (A) A MIPS eligible clinician earns a base score by reporting for each base score measure, as applicable: The numerator (of at least one) and denominator, or a yes/no statement, or an exclusion. (B) A MIPS eligible clinician earns a performance score by reporting on the performance score measures specified by CMS. A MIPS eligible clinician may earn up to 10 or 20 percentage points as specified by CMS for each performance score measure reported. (C) A MIPS eligible clinician may earn the following bonus scores: ( 1 ( 2 ( 3 (ii) Beginning with the 2019 performance period/2021 MIPS payment year, a MIPS eligible clinician's Promoting Interoperability performance category score equals the sum of the scores for each of the required measures and any applicable bonus scores, not to exceed 100 points. (A) A MIPS eligible clinician earns a score for each measure by reporting, as applicable: the numerator (of at least one) and denominator, or a yes/no statement. If an exclusion is reported for a measure, the points available for that measure are redistributed to another measure(s). (B) For the 2019 performance period/2021 MIPS payment year through the 2022 performance period/2024 MIPS payment year, each required measure is worth 10, 20, or 40 points, as specified by CMS. For the 2023 performance period/2025 MIPS payment year and subsequent years, each required measure is worth 10, 15, 25 or 30 points, as specified by CMS. (C)( 1 ( 2 ( 3 (iii) Beginning with the CY 2026 performance period/2028 MIPS payment year, if certain circumstances occur that impact CMS' assessment of the performance of MIPS eligible clinicians on a measure specified for the Promoting Interoperability performance category under § 414.1375(b), CMS may, in its sole discretion, suppress the affected measure by excluding it from CMS' assessment of performance while allocating the maximum points available or providing full credit for the affected measure as long as the affected measure is reported, resulting in a suppressed measure contributing to the Promoting Interoperability performance category objective score under paragraph (b)(4) of this section; or excluding it from the determination of a meaningful EHR user if the affected measure is not scored. CMS determines whether certain circumstances exist warranting suppression of a measure based on CMS' consideration of one or more of the following factors: (A) The nature, breadth, and duration of the circumstances' effect on MIPS eligible clinicians' ability to fulfill the measure requirement. (B) The availability of certified health IT modules to fulfill the measure. (C) The circumstance affects the measure such that calculating the measure score would lead to misleading or inaccurate results, which may include performance or compliance. (D) Out-of-date or conflicting technical standards. (E) Technical and operational capacity of required partners. (F) Other factors as determined by CMS. (c) Final score calculation. Table 1 to Paragraph ( c For the 2019 MIPS payment year: Final score = [(quality performance category score × quality performance category weight) + (cost performance category score × cost performance category weight) + (improvement activities performance category score × improvement activities performance category weight) + (Promoting Interoperability performance category score × Promoting Interoperability performance category weight)], not to exceed 100 points. For the 2020 MIPS payment year: Final score = [(quality performance category score × quality performance category weight) + (cost performance category score × cost performance category weight) + (improvement activities performance category score × improvement activities performance category weight) + (Promoting Interoperability performance category score × Promoting Interoperability performance category weight)] × 100 + [the complex patient bonus + the small practice bonus], not to exceed 100 points. Beginning with the 2021 MIPS payment year: Final score = [(quality performance category score × quality performance category weight) + (cost performance category score × cost performance category weight) + (improvement activities performance category score × improvement activities performance category weight) + (Promoting Interoperability performance category score × Promoting Interoperability performance category weight)] × 100 + the complex patient bonus, not to exceed 100 points. (1) Performance category weights. (i) Quality performance category weight is defined under § 414.1330(b). (ii) Cost performance category weight is defined under § 414.1350(d). (iii) Improvement activities performance category weight is defined under § 414.1355(b). (iv) Promoting Interoperability performance category weight is defined under § 414.1375(a). (2) Reweighting the performance categories. (A) CMS determines based on the following circumstances that there are not sufficient measures and activities applicable and available under section 1848(q)(5)(F) of the Act. ( 1 ( 2 ( 3 ( 4 For the Promoting Interoperability performance category: ( i ( ii ( iii ( 5 ( 6 ( 7 ( 8 ( 9 ( 10 (B) Under section 1848(q)(5)(E)(ii) of the Act, CMS estimates that the proportion of MIPS eligible clinicians who are physicians as defined in section 1861(r) of the Act and earn a Promoting Interoperability performance category score of at least 75 percent is 75 percent or greater. The estimation is based on data from the performance period that occurs four years before the MIPS payment year and does not include physicians for whom the Promoting Interoperability performance category is weighted at zero percent. (C) Under section 1848(o)(2)(D) of the Act, a significant hardship exception or other type of exception is granted to a MIPS eligible clinician based on the following circumstances for the Promoting Interoperability performance category. Except as provided in paragraphs (c)(2)(i)(C)( 10 11 ( 1 ( 2 ( 3 ( 4 ( 5 ( 6 ( 7 ( 8 ( 9 ( 10 ( 11 ( 12 (ii) A scoring weight different from the weights specified in paragraph (c)(1) of this section will be assigned to a performance category, and its weight as specified in paragraph (c)(1) of this section will be redistributed to another performance category or categories, as follows: (A) For the 2019 MIPS payment year: Table 2 to Paragraph (c)(2)(ii)(A) Performance category Weighting for Reweight scenario Reweight Reweight scenario Quality 60 85 0 75 Cost 0 0 0 0 Improvement Activities 15 15 50 0 Promoting Interoperability 25 0 50 25 (B) For the 2020 MIPS payment year: Reweighting scenario Quality Cost Improvement activities Promoting interoperability No Reweighting Needed: —Scores for all four performance categories 50 10 15 25 Reweight One Performance Category: —No Cost 60 0 15 25 —No Promoting Interoperability 75 10 15 0 —No Quality 0 10 45 45 —No Improvement Activities 65 10 0 25 Reweight Two Performance Categories: —No Cost and no Promoting Interoperability 85 0 15 0 —No Cost and no Quality 0 0 50 50 —No Cost and no Improvement Activities 75 0 0 25 —No Promoting Interoperability and no Quality 0 10 90 0 —No Promoting Interoperability and no Improvement Activities 90 10 0 0 —No Quality and no Improvement Activities 0 10 0 90 (C) For the 2021 MIPS payment year: Reweighting scenario Quality Cost Improvement activities Promoting interoperability No Reweighting Needed: —Scores for all four performance categories 45 15 15 25 Reweight One Performance Category: —No Cost 60 0 15 25 —No Promoting Interoperability 70 15 15 0 —No Quality 0 15 40 45 —No Improvement Activities 60 15 0 25 Reweight Two Performance Categories: —No Cost and no Promoting Interoperability 85 0 15 0 —No Cost and no Quality 0 0 50 50 —No Cost and no Improvement Activities 75 0 0 25 —No Promoting Interoperability and no Quality 0 15 85 0 —No Promoting Interoperability and no Improvement Activities 85 15 0 0 —No Quality and no Improvement Activities 0 15 0 85 (D) For the 2022 MIPS payment year: Reweighting scenario Quality Cost Improvement activities Promoting No Reweighting Needed: Scores for all four performance categories 45 15 15 25 Reweight One Performance Category: No Cost 55 0 15 30 No Promoting Interoperability 70 15 15 0 No Quality 0 15 15 70 No Improvement Activities 60 15 0 25 Reweight Two Performance Categories: No Cost and no Promoting Interoperability 85 0 15 0 No Cost and no Quality 0 0 15 85 No Cost and no Improvement Activities 70 0 0 30 No Promoting Interoperability and no Quality 0 50 50 0 No Promoting Interoperability and no Improvement Activities 85 15 0 0 No Quality and no Improvement Activities 0 15 0 85 (E) For the 2023 MIPS payment year: Table 6 to Paragraph ( c ii Reweighting scenario Quality Cost Improvement Promoting No Reweighting Needed: Scores for all four performance categories 40 20 15 25 No Cost 55 0 15 30 No Promoting Interoperability 65 20 15 0 No Quality 0 20 15 65 No Improvement Activities 55 20 0 25 No Cost and no Promoting Interoperability 85 0 15 0 No Cost and no Quality 0 0 15 85 No Cost and no Improvement Activities 70 0 0 30 No Promoting Interoperability and no Quality 0 50 50 0 No Promoting Interoperability and no Improvement Activities 80 20 0 0 No Quality and no Improvement Activities 0 20 0 80 (F) Except as provided in paragraph (c)(2)(ii)(G) of this section, beginning with the 2024 MIPS payment year: Table 7 to Paragraph (c)(2)(ii)(F) Reweighting scenario Quality Cost Improvement Promoting No Reweighting Needed: Scores for all four performance categories 30 30 15 25 No Cost 55 0 15 30 No Promoting Interoperability 55 30 15 0 No Quality 0 30 15 55 No Improvement Activities 45 30 0 25 No Cost and no Promoting Interoperability 85 0 15 0 No Cost and no Quality 0 0 15 85 No Cost and no Improvement Activities 70 0 0 30 No Promoting Interoperability and no Quality 0 50 50 0 No Promoting Interoperability and no Improvement Activities 70 30 0 0 No Quality and no Improvement Activities 0 30 0 70 (G) For small practices beginning with the 2024 MIPS payment year: Table 8 to Paragraph (c)(2)(ii)(G) Reweighting scenario Quality Cost Improvement Promoting No Reweighting Needed: Scores for all four performance categories 30 30 15 25 No Cost 55 0 15 30 No Promoting Interoperability 40 30 30 0 No Quality 0 30 15 55 No Improvement Activities 45 30 0 25 No Cost and no Promoting Interoperability 50 0 50 0 No Cost and no Quality 0 0 15 85 No Cost and no Improvement Activities 70 0 0 30 No Promoting Interoperability and no Quality 0 50 50 0 No Promoting Interoperability and no Improvement Activities 70 30 0 0 No Quality and no Improvement Activities 0 30 0 70 (iii) For the Promoting Interoperability performance category to be reweighted in accordance with paragraph (c)(2)(ii) of this section for a MIPS eligible clinician who elects to participate in MIPS as part of a group or virtual group, all of the MIPS eligible clinicians in the group or virtual group must qualify for reweighting based on the circumstances described in paragraph (c)(2)(i) of this section, or the group or virtual group must meet the definition of a hospital-based MIPS eligible clinician or a non-patient facing MIPS eligible clinician as defined in § 414.1305. (iv) If CMS has granted an application for a hardship exception or any other type of exception to a MIPS eligible clinician under paragraph (c)(2)(i)(A)( 6 2 8 3 (3) Complex patient bonus. (i) For the CY 2020, 2021, 2022, and 2023 MIPS payment years and associated performance periods, for MIPS eligible clinicians and groups, the complex patient bonus is calculated as follows: [The average HCC risk score assigned to beneficiaries (pursuant to the HCC risk adjustment model established by CMS pursuant to section 1853(a)(1) of the Act) seen by the MIPS eligible clinician or seen by clinicians in a group] + [the dual eligible ratio × 5]. (ii) For the CY 2020, 2021, 2022, and 2023 MIPS payment years and associated performance periods, for APM Entities and virtual groups, the complex patient bonus is calculated as follows: [The beneficiary weighted average HCC risk score for all MIPS eligible clinicians, and if technically feasible, TINs for models and virtual groups which rely on complete TIN participation within the APM Entity or virtual group, respectively] + [the average dual eligible ratio for all MIPS eligible clinicians, and if technically feasible, TINs for models and virtual groups which rely on complete TIN participation, within the APM Entity or virtual group, respectively, × 5]. (iii) For the 2020, 2021, 2022, and 2023 MIPS payment years and associated performance periods, the complex patient bonus cannot exceed 5.0 except as provided in paragraph (c)(3)(iv) of this section. (iv) For the 2022 and 2023 MIPS payment years and associated performance periods, the complex patient bonus is calculated pursuant to paragraphs (c)(3)(i) and (ii) of this section, and the resulting numerical value is then multiplied by 2.0. The complex patient bonus cannot exceed 10.0. (v) Beginning with the CY 2022 MIPS performance period/CY 2024 MIPS payment year, the complex patient bonus is limited to MIPS eligible clinicians, groups, APM Entities and virtual groups; with a risk indicator at or above the risk indicator calculated median. To determine the median for the respective risk indicator (HCC and dual proportion), risk indicators associated with the final score assigned to a clinician from the most recent prior performance period, for all those who have submitted data for at least one MIPS performance category or are facility-based, are used. (vi) Beginning with the CY 2022 MIPS performance period/CY 2024 MIPS payment year, for MIPS eligible clinicians and groups, the complex patient bonus components are calculated as follows for the specific risk indicators: Medical complex patient bonus component = 1.5 + 4 * associated HCC standardized score calculated with the average HCC risk score assigned to beneficiaries (pursuant to the HCC risk adjustment model established by CMS pursuant to section 1853(a)(1) of the Act) seen by the MIPS eligible clinician or seen by clinicians in a group or subgroup; social complex patient bonus component = 1.5 + 4 * associated dual proportion standardized score. The components are added together to calculate one overall complex patient bonus. A standardized score for each risk indicator is determined based on the mean and standard deviation of the raw risk indicator score and provides a standardized measurement of how far each risk score is from the mean: (raw risk indicator score−risk indicator mean)/risk indicator standard deviation. (vii) Beginning with the CY 2022 MIPS performance period/CY 2024 MIPS payment year, for APM Entities and virtual groups, the complex patient bonus components are calculated as follows for the specific risk indicators: Medical complex patient bonus component = 1.5 + 4 * the beneficiary weighted average HCC risk standardized score for all MIPS eligible clinicians, and if technically feasible, TINs for models and virtual groups which rely on complete TIN participation within the APM Entity or virtual group, respectively; social complex patient bonus component = 1.5 + 4 * the average dual proportion standardized score for all MIPS eligible clinicians, and if technically feasible, TINs for models and virtual groups which rely on complete TIN participation, within the APM Entity or virtual group, respectively. The components are added together to calculate one overall complex patient bonus. A standardized score for each risk indicator is determined based on the mean and standard deviation of the raw risk indicator score and provides a standardized measurement of how far each risk score is from the mean: (raw risk indicator score−risk indicator mean)/risk indicator standard deviation. (viii) Beginning with the CY 2022 MIPS performance period/CY 2024 MIPS payment year, the complex patient bonus cannot exceed 10.0 and cannot be below 0.0. (4) Small practice bonus. (d) Scoring for APM Entities. (e) Scoring for facility-based measurement. (1) General. (i) The measures used for facility-based measurement are the measure set finalized for the fiscal year value-based purchasing program for which payment begins during the applicable MIPS performance period. (ii) Beginning with the 2021 MIPS payment year, the scoring methodology applicable for MIPS eligible clinicians scored with facility-based measurement is the Total Performance Score methodology adopted for the Hospital VBP Program, for the fiscal year for which payment begins during the applicable MIPS performance period. (2) Eligibility for facility-based measurement. (i) Facility-based individual determination. (A) Furnishes 75 percent or more of his or her covered professional services in sites of service identified by the place of service codes used in the HIPAA standard transaction as an inpatient hospital, on-campus outpatient hospital, or emergency room setting based on claims for a 12-month segment beginning on October 1 of the calendar year 2 years prior to the applicable performance period and ending on September 30 of the calendar year preceding the performance period with a 30-day claims run out. (B) Furnishes at least 1 covered professional service in sites of service identified by the place of service codes used in the HIPAA standard transaction as an inpatient hospital, or emergency room setting. (C) Can be assigned, under the methodology specified in paragraph (e)(5) of this section, to a facility with a value-based purchasing score for the applicable period. (ii) Facility-based MIPS eligible group determination. (3) [Reserved] (4) Data submission for facility-based measurement. (5) Determination of applicable facility score. (i) A facility-based MIPS eligible clinician is scored with facility-based measurement using the score derived from the value-based purchasing score for the facility at which the clinician provided services to the most Medicare beneficiaries during the period the claims are drawn from in paragraph (e)(2) of this section. If there is an equal number of Medicare beneficiaries treated at more than one facility, the value-based purchasing score for the highest scoring facility is used. (ii) A facility-based MIPS eligible group is scored with facility-based measurement using the score derived from the value-based purchasing score for the facility at which the plurality of clinicians identified as facility-based would have had their score determined under paragraph (e)(5)(i) of this section. (6) MIPS performance category scoring under the facility-based measurement scoring standard Measures. (ii) Benchmarks. (iii) Performance period. (iv) Quality. (v) Cost. (A) Other cost measures. MIPS eligible clinicians who are scored under facility-based measurement are not scored on cost measures described in paragraph (b)(2) of this section. (B) [Reserved] (vi) Use of score from facility-based measurement. (A) For the CY 2019 MIPS performance period/2021 MIPS payment year, through the CY 2021 MIPS performance period/2023 MIPS payment year, a MIPS eligible clinician or group receives a higher combined MIPS quality and cost performance category score through another MIPS submission. (B) Beginning with the CY 2022 MIPS performance period/2024 MIPS payment year, a MIPS eligible clinician or group receives a higher MIPS final score through another MIPS submission. [83 FR 60081, Nov. 23, 2018, as amended at 84 FR 63196, Nov. 15, 2019; 85 FR 19287, Apr. 6, 2020; 85 FR 85031, Dec. 28, 2020; 86 FR 65673, Nov. 19, 2021; 86 FR 73159, Dec. 27, 2021; 87 FR 7747, Feb. 10, 2022; 87 FR 70228, Nov. 18, 2022; 88 FR 15921, Mar. 15, 2023; 88 FR 79535, Nov. 16, 2023; 89 FR 98562, Dec. 9, 2024; 90 FR 50010, Nov. 5, 2025; 91 FR 12079, Mar. 12, 2026] § 414.1385 Targeted review and review limitations. (a) Targeted review. (1) A MIPS eligible clinician, virtual group, subgroup, or group; (including their designated support staff), or a third party intermediary as defined at § 414.1305, may submit a request for a targeted review. (2) All requests for targeted review must be submitted during the targeted review request submission period, which begins on the day CMS makes available the MIPS final score, and ends 30 days after publication of the MIPS payment adjustment factors for the MIPS payment year. The targeted review request submission period may be extended as specified by CMS. (3) A request for a targeted review may be denied if the request is duplicative of another request for a targeted review; the request is not submitted during the targeted review request submission period; or the request is outside of the scope of the targeted review, which is limited to the calculation of the MIPS payment adjustment factors applicable to the MIPS eligible clinician, virtual group, subgroup, or group; for a year. If the targeted review request is denied, there will be no change to the MIPS final score or associated MIPS payment adjustment factors for the MIPS eligible clinician, virtual group, subgroup, or group. If the targeted review request is approved, the MIPS final score and associated MIPS payment adjustment factors may be revised, if applicable, for the MIPS eligible clinician, virtual group, subgroup, or group. (4) CMS will respond to each request for a targeted review timely submitted and determine whether a targeted review is warranted. (5) A request for a targeted review may include additional information in support of the request at the time it is submitted. If CMS requests additional information from the MIPS eligible clinician, virtual group, subgroup. or group that is the subject of a request for a targeted review, the information must be provided and received by CMS within 15 days of CMS' request. Non-responsiveness to CMS' request for additional information may result in a final decision based on the information available, although another non-duplicative request for targeted review may be submitted before the end of the targeted review request submission period. (6) If a request for a targeted review is approved, CMS may recalculate, to the extent feasible and applicable, the scores of a MIPS eligible clinician, virtual group, subgroup, or group with regard to measures, activities, performance categories, and the final score, as well as the MIPS payment adjustment factors. (7) Decisions based on the targeted review are final, and there is no further review or appeal. CMS will notify the individual or entity that submitted the request for a targeted review of the final decision. (8) Documentation submitted for a targeted review must be retained by the submitter for 6 years from the end of the MIPS performance period. (b) Limitations on review. (1) The methodology used to determine the amount of the MIPS payment adjustment factor and the amount of the additional MIPS payment adjustment factor and the determination of such amounts; (2) The establishment of the performance standards and the performance period; (3) The identification of measures and activities specified for a MIPS performance category and information made public or posted on the Physician Compare Internet Web site of the CMS; and (4) The methodology developed that is used to calculate performance scores and the calculation of such scores, including the weighting of measures and activities under such methodology. [81 FR 77537, Nov. 4, 2016, as amended at 84 FR 63197, Nov. 15, 2019; 88 FR 79536, Nov. 16, 2023] § 414.1390 Data validation and auditing. (a) General. (1) Comply with data sharing requests, providing all data as requested by CMS or our designated entity. All data must be shared with CMS or our designated entity within 45 days of the data sharing request, or an alternate timeframe that is agreed to by CMS and the MIPS eligible clinician or group. Data will be submitted via email, facsimile, or an electronic method via a secure Web site maintained by CMS. (2) Provide substantive, primary source documents as requested. These documents may include: Copies of claims, medical records for applicable patients, or other resources used in the data calculations for MIPS measures, objectives, and activities. Primary source documentation also may include verification of records for Medicare and non-Medicare beneficiaries where applicable. (b) Certification. (c) Reopening. (d) Record retention. [81 FR 77537, Nov. 4, 2016, as amended at 82 FR 53959, Nov. 16, 2017] § 414.1395 Public reporting. (a) General. (i) Information regarding the performance of MIPS eligible clinicians, including, but not limited to, final scores and performance category scores for each MIPS eligible clinician; and (ii) The names of eligible clinicians in Advanced APMs and, to the extent feasible, the names and performance of such Advanced APMs. (2) CMS periodically posts on Physician Compare aggregate information on the MIPS, including the range of final scores for all MIPS eligible clinicians and the range of the performance of all MIPS eligible clinicians with respect to each performance category. (3) The information made available under this section will indicate, where appropriate, that publicized information may not be representative of an eligible clinician's entire patient population, the variety of services furnished by the eligible clinician, or the health conditions of individuals treated. (b) Maintain existing public reporting standards. (c) New measures and activities. (2) CMS does not publicly report any MVP data on new improvement activity or Promoting Interoperability measure, objective, or activity included in an MVP for the first year in which it is included in the MVP. (d) 30-day preview period. [82 FR 53959, Nov. 16, 2017, as amended at 83 FR 60087, Nov. 23, 2018; 84 FR 63198, Nov. 15, 2019; 86 FR 65677, Nov. 19, 2021] § 414.1400 Third party intermediaries. (a) General. (i) QCDR; (ii) Qualified registry; (iii) Before the CY 2025 performance period/2027 payment year, Health IT vendor; (iv) CMS-approved survey vendor. (2) Third party intermediary approval criteria— (i) To be approved as a third party intermediary, an organization must meet the following requirements: (A) The organization's principal place of business and the location in which it stores data must be in the U.S. (B) The organization must have the ability to indicate the source of any data it will submit to CMS if the data will be derived from CEHRT, a QCDR, qualified registry, or health IT vendor. (C) The organization must certify that it intends to provide services throughout the entire performance period and applicable data submission period. (ii) The determination of whether to approve an entity as a third party intermediary for a MIPS payment year may take into account: (A) Whether the organization failed to comply with the requirements of this section for any prior MIPS payment year for which it was approved as third party intermediary, including past compliance; and (B) Whether the entity provided inaccurate information regarding the requirements of this subpart to any eligible clinician. (iii) Beginning with the 2023 MIPS payment year, third party intermediaries must attend and complete training and support sessions in the form and manner, and at the times, specified by CMS. (3) For third-party intermediary program requirements: (i) All data submitted to CMS by a third party intermediary on behalf of a MIPS eligible clinician, group, virtual group, subgroup, or APM Entity must be certified by the third party intermediary as true, accurate, and complete to the best of its knowledge. Such certification must be made in a form and manner and at such time as specified by CMS. (ii) All data submitted to CMS by a third party intermediary must be submitted in the form and manner specified by CMS. (A) The submission of data on measures by a third party intermediary to CMS must include data on all of the MIPS eligible clinician's patients, regardless of payer, unless otherwise specified by the collection type. (B) [Reserved] (iii) If the clinician chooses to opt-in to participate in MIPS in accordance with § 414.130, the third party intermediary must be able to transmit that decision to CMS. (iv) Prior to discontinuing services to any MIPS eligible clinician, group, virtual group, subgroup, or APM Entity during a performance period, a third party intermediary must support the transition of such MIPS eligible clinician, group, virtual group, subgroup, or APM Entity to an alternate third party intermediary, submitter type, or, for any measure on which data has been collected, collection type according to a CMS approved transition plan by a date specified by CMS. The transition plan must address the following issues, unless different or additional information is specified by CMS: (A) The issues that contributed to the withdrawal mid-performance period or discontinuation of services mid-performance period. (B) Impacted entities: ( 1 ( 2 (C) The steps the third party intermediary will take to ensure that the clinicians, groups, virtual groups, subgroups, or APM Entities identified in paragraph (a)(3)(iv)(B)(1) of this section are notified of the transition in a timely manner, and successfully transitioned to an alternate third party intermediary, submitter type, or, for any measure or activity on which data has been collected, collection type, as applicable. (D) A detailed timeline that outlines timing for communications, the start of the transition, and completion of the transition of these clinicians, groups, virtual groups, subgroups, or APM Entities. (E) The third party intermediary must communicate to CMS that the transition was completed by the date included in the detailed timeline. (v) As a condition of its qualification and approval to participate in MIPS as a third party intermediary, a third party intermediary must: (A) Make available to CMS the contact information of each MIPS eligible clinician, group, virtual group, subgroup, or APM Entity on behalf of whom it submits data. The contact information must include, at a minimum, the MIPS eligible clinician, group, virtual group, subgroup, or APM Entity phone number, address, and, if available, email. (B) Retain all data submitted to CMS for purposes of MIPS for 6 years from the end of the MIPS performance period. (C) Upon request, provide CMS with any records or data retained in connection with its operation as a third party intermediary for up to 6 years from the end of the MIPS performance period. (vi) Beginning with the 2023 MIPS payment year, third party intermediaries must attend and complete training and support sessions in the form and manner, and at the times, specified by CMS. (b) Additional requirements for QCDRs and qualified registries General. (A) Quality, except: ( 1 ( 2 (B) Improvement activities; and (C) Promoting Interoperability, if the eligible clinician, group, virtual group, or subgroup is using CEHRT, unless the third party intermediary's MIPS eligible clinicians, groups, virtual groups, or subgroups fall under the reweighting policies at § 414.1380(c)(2)(i)(A)(4)(i) through (iii) or (c)(2)(i)(C)(1) through (7) or (c)(2)(i)(C)(9). (ii)(A) Beginning with the CY 2023 performance period/2025 MIPS payment year through the CY 2025 performance period/2027 MIPS payment year, QCDRs and qualified registries must support MVPs that are applicable to the MVP participant on whose behalf they submit MIPS data. (B) Beginning with the CY 2026 performance period/2028 MIPS payment year, QCDRs and qualified registries must support MVPs that are applicable to the MVP participant on whose behalf they submit MIPS data no later than 1 year after finalization of the MVP in accordance with the current requirement. ( 1 ( 2 ( i ( ii (iii) Beginning with the CY 2023 performance period/2025 MIPS payment year, A QCDR or qualified registry must support subgroup reporting. (2) Self-nomination. (3) Conditions for approval. (ii) If an entity seeking to qualify as a QCDR or qualified registry uses an external organization for purposes of data collection, calculation, or transmission, it must have a signed, written agreement with the external organization that specifically details the responsibilities of the entity and the external organization. The written agreement must be effective as of September 1 of the year preceding the applicable performance period. (iii) Beginning with the CY 2021 performance period/2023 MIPS payment year, the QCDR or qualified registry must provide performance feedback to their clinicians and groups at least 4 times a year, and provide specific feedback to their clinicians and groups on how they compare to other clinicians who have submitted data on a given measure within the QCDR or qualified registry. Exceptions to this requirement may occur if the QCDR or qualified registry submits notification to CMS within the performance period promptly within the month of realization of the impending deficiency and provides sufficient rationale as to why they do not believe they would be able to meet this requirement (for example, if the QCDR does not receive the data from their clinician until the end of the performance period). (iv) Beginning with the CY 2023 performance period/2025 MIPS payment year, the QCDR or qualified registry must submit a data validation plan annually, at the time of self-nomination for CMS' approval and may not change the plan once approved without the prior approval of the agency. (v) Beginning with the CY 2021 performance period/2023 MIPS payment year, the QCDR or qualified registry must conduct annual data validation audits in accordance with this paragraph (b)(3)(v). (A) The QCDR or qualified registry must conduct data validation for the payment year prior to submitting any data for that payment year to CMS for purposes of the MIPS program. (B) The QCDR or qualified registry must conduct data validation on data for each performance category for which it will submit data, including if applicable the Quality, Improvement Activities, and Promoting Interoperability performance categories. (C) The QCDR or qualified registry must conduct data validation on data for each submitter type for which it will submit data, including MIPS eligible clinicians, groups, virtual groups, subgroups, APM entities, voluntary participants, and opt-in participants, if applicable. (D) The QCDR or qualified registry must use clinical documentation (provided by the clinicians they are submitting data for) to validate that the action or outcome measured actually occurred or was performed. (E) The QCDR or qualified registry must conduct each data validation audit using a sampling methodology that meets the following requirements: ( 1 ( 2 (F) Each QCDR or qualified registry data validation audit must include the following: ( 1 ( 2 ( 3 ( 4 (G) In a form and manner and by a deadline specified by CMS, the QCDR or qualified registry must report the results of each data validation audit, including the overall data deficiencies or data error rate, the types of deficiencies or data errors discovered, the percentage of clinicians impacted by any deficiency or error, and, how and when each deficiency or data error type was corrected. ( 1 ( 2 (vi) Beginning with the CY 2021 performance period/2023 MIPS payment year, the QCDR or qualified registry must conduct targeted audits in accordance with this paragraph (b)(3)(vi). (A) If a data validation audit under paragraph (b)(3)(v) of this section identifies one or more deficiency or data error, the QCDR or qualified registry must conduct a targeted audit into the impact and root cause of each such deficiency or data error for that MIPS payment year. (B) The QCDR or qualified registry must conduct any required targeted audits for the MIPS payment year and correct any deficiencies or data errors identified through such audit prior to the submission of data for that MIPS payment year. (C) The QCDR or qualified registry must conduct the targeted audit using the sampling methodology that meets the requirements described in paragraph (b)(3)(iv)(E) of this section. The sample for the targeted audit must not include data from the sample used for the data validation audit in which the deficiency or data error was identified. (D) In a form and manner and by a deadline specified by CMS, the QCDR or qualified registry must report the results of each targeted audit, including the overall deficiency or data error rate, the types of deficiencies or data errors discovered, the percentage of clinicians impacted by each deficiency or data error, and how and when each deficiency or data error type was corrected. (vii) For the CY 2023 performance period/2025 MIPS payment year, a QCDR or qualified registry that was approved but did not submit any MIPS data for any of the 2019 through 2023 MIPS payment years must submit a participation plan for CMS' approval. The participation plan must include the QCDR and/or qualified registry's detailed plans about how the QCDR or qualified registry intends to encourage clinicians to submit MIPS data to CMS through the QCDR or qualified registry. (viii) Beginning with the CY 2024 performance period/2026 MIPS payment year, a QCDR or qualified registry that was approved but did not submit any MIPS data for either of the 2 years preceding the applicable self-nomination period must submit a participation plan for CMS' approval. This participation plan must include the QCDR's and/or qualified registry's detailed plans about how the QCDR or qualified registry intends to encourage clinicians to submit MIPS data to CMS through the QCDR or qualified registry. (ix) During the self-nomination period, a QCDR or a qualified registry must submit to CMS quality measure numbers, Promoting Interoperability identifiers, improvement activity identifiers and MVP titles. (x) A QCDR or a qualified registry must be able to submit to CMS data for at least six quality measures including at least one outcome measure. (A) If no outcome measure is available, a QCDR or qualified registry must be able to submit to CMS results for at least one other high priority measure. (B) [Reserved] (xi) A QCDR or a qualified registry must submit to CMS risk-adjusted measure results when submitting data for measures that include risk adjustment in the measure specification. (xii) A QCDRs or qualified registry must enter into appropriate Business Associate Agreements with MIPS eligible clinicians to collect and process their data. (xiii) A QCDR or a qualified registry must maintain records of their authorization to submit data to CMS for the purpose of MIPS participation for each NPI whom the QCDR or qualified registry will submit data to CMS for. The records must: (A) Be annually obtained by the QCDR or qualified registry at the time the clinician or group enters into an agreement with the QCDR or qualified registry for the submission of MIPS data to the QCDR or qualified registry. (B) Be signed by an eligible clinician, if reporting individually, or by an authorized representative of the reporting group, subgroup, Virtual Group, or APM Entity. (C) Records of the authorization must be maintained for 6 years after the performance period ends. (xiv) A QCDR or a qualified registry must attest that the information listed on the qualified posting is accurate. (xv) A QCDR or a qualified registry must provide to CMS, upon request, the data submitted by the QCDR or qualified registry for purposes of MIPS. (xvi) A QCDR or qualified registry must attest to the following: (A) A QCDR or a qualified registry must attest that it has required each MIPS eligible clinician on whose behalf it reports to provide the QCDR or qualified registry with all documentation necessary to verify the accuracy of the data on quality measures that the eligible clinician submitted to the QCDR or qualified registry. (B) A QCDR or qualified registry must also attest that it has required each MIPS eligible clinician to permit the QCDR or qualified registry to provide the information described in paragraph (b)(3)(xviii)(A) of this section to CMS upon request. (xvii) A QCDR or a qualified registry must accept and maintain clinician data by January 1 of the applicable performance period. (4) QCDR measures for the quality performance category QCDR measure self-nomination requirements. (A) For MIPS quality measures, the entity must submit specifications including the MIPS measure IDs and specialty-specific measure sets, as applicable. (B) For a QCDR measure, the entity must submit for CMS approval measure specifications including: Name/title of measure, descriptions of the denominator, numerator, and when applicable, denominator exceptions, denominator exclusions, risk adjustment variables, and risk adjustment algorithms. In addition, no later than 15 calendar days following CMS posting of all approved specifications for a QCDR measure, the entity must publicly post the CMS-approved measure specifications for the QCDR measure (including the CMS-assigned QCDR measure ID) and provide CMS with a link to where this information is posted. The approved QCDR measure specifications must remain published through the performance period and data submission period. (C) For a QCDR measure, the QCDR must provide, if available, data from years prior before the start of the performance period. (ii) QCDR measure submission requirements. (iii) QCDR measure approval criteria. ( 1 ( 2 ( 3 ( 4 ( 5 (B) QCDR measure considerations for approval include, but are not limited to: ( 1 ( 2 ( 3 ( 4 ( 5 ( 6 ( 7 ( i ( ii ( 8 ( 9 ( i ( ii ( 10 ( i ( ii (C) Beginning with the CY 2021 performance period/2023 MIPS payment year, QCDR measures may be approved for 2 years, at CMS discretion by attaining approval status by meeting QCDR measure considerations and requirements. Upon annual review, CMS may revoke a QCDR measure's second year approval, if the QCDR measure is found to be: Topped out; duplicative of a more robust measure; reflects an outdated clinical guideline; or if the QCDR self-nominating the QCDR measure is no longer in good standing. (iv) QCDR measure rejection criteria. (A) QCDR measures that are duplicative or identical to other QCDR measures or MIPS quality measures that are currently in the program. (B) QCDR measures that are duplicative or identical to MIPS quality measures that have been removed from MIPS through rulemaking. (C) QCDR measures that are duplicative or identical to quality measures used under the legacy Physician Quality Reporting System (PQRS) program, which have been retired. (D) QCDR measures that meet the topped out definition as described at § 414.1305. (E) QCDR measures that are process-based, with consideration to whether the removal of the process measure impacts the number of measures available for a specific specialty. (F) Whether the QCDR measure has potential unintended consequences to a patient's care. (G) Considerations and evaluation of the measure's performance data, to determine whether performance variance exists. (H) QCDR measures that split a single clinical practice or action into several QCDR measures. (I) QCDR measures that are “check-box” with no actionable quality action. (J) QCDR measures that do not meet the case minimum and reporting volumes required for benchmarking after being in the program for 2 consecutive years. (K) QCDR measures with clinician attribution issues, where the quality action is not under the direct control of the reporting clinician. (L) QCDR measures that focus on rare events or “never events” in the measurement period. (M) QCDR does not have permission to use a QCDR measure owned by another QCDR for the applicable performance period. (N) If a QCDR measure owner is not approved or is not in good standing, any associated QCDR measures will not be approved. (O) QCDR measures submitted after self-nomination. (P) More than 30 QCDR measures are submitted by a single QCDR. (c) Additional requirements for Health IT vendors. (i) Health IT vendors that support MVPs must be able to submit data for all of the MIPS performance categories: (A) Quality, except: ( 1 ( 2 (B) Improvement activities; and (C) Promoting Interoperability, if the eligible clinician, group, virtual group, or subgroup is using CEHRT, unless: ( 1 4 i iii 1 7 9 ( 2 (ii) Health IT vendors that do not support MVPs must be able to submit data for at least one of the MIPS performance categories described in paragraphs (c)(1)(i) of this section. (iii) Beginning with the CY 2023 performance period/2025 MIPS payment year, Health IT vendors must support MVPs that are applicable to the MVP participant on whose behalf they submit MIPS data. Health IT vendors may also support the APP. (2) [Reserved] (d) Additional requirements for CMS-approved survey vendors. (2) Entities seeking to be a CMS-approved survey vendor for any MIPS performance period must submit a survey vendor application to CMS in a form and manner specified by CMS for each MIPS performance period for which it wishes to transmit such data. The application and any supplemental information requested by CMS must be submitted by deadlines specified by CMS. For an entity to be a CMS-approved survey vendor, it must meet the following criteria: (3) The entity must have sufficient experience, capability, and capacity to accurately report CAHPS data, including all of the following: (i) At least 3 years of experience administering surveys in which mail survey administration is followed by survey administration via Computer Assisted Telephone Interview (CATI); (ii) At least 3 years of experience administering surveys to a Medicare population. (iii) At least 3 years of experience administering CAHPS surveys within the past 5 years. (iv) Experience administering surveys in English and at least one other language for which a translation of the CAHPS for MIPS survey is available; (A) Beginning January 1, 2024, in addition to administering the survey in English, entities must administer the Spanish survey translation to Spanish-preferring patients using the procedures detailed in subregulatory guidance to standardize the CAHPS data collection process for MIPS and to make sure the survey data collected across survey vendors are comparable within the program or model;. (B) [Reserved] (v) Use equipment, software, computer programs, systems, and facilities that can verify addresses and phone numbers of sampled beneficiaries, monitor interviewers, collect data via CATI, electronically administer the survey and schedule call-backs to beneficiaries at varying times of the day and week, track fielded surveys, assign final disposition codes to reflect the outcome of data collection of each sampled case, and track cases from mail surveys through telephone follow-up activities; and (A) Beginning January 1, 2027, use equipment, software, computer programs, systems, and facilities that can send survey invitations via email that include a patient-specific hyperlink to a web survey, collect data via web, and track cases from web surveys through telephone follow-up activities. (B) [Reserved] (vi) Employment of a program manager, information systems specialist, call center supervisor and mail center supervisor to administer the survey. (A) Beginning January 1, 2027, employ a web survey administrator. (B) [Reserved] (vii) Beginning January 1, 2027, at least 3 years of experience administering surveys in which web survey administration is followed by survey administration via mail survey or Computer Assisted Telephone Interview (CATI). (4) The entity has certified that it has the ability to maintain and transmit quality data in a manner that preserves the security and integrity of the data. (5) The entity has successfully completed, and has required its subcontractors to successfully complete, vendor training(s) administered by CMS or its contractors. (6) The entity has submitted a quality assurance plan and other materials relevant to survey administration, as determined by CMS, including cover letters, questionnaires and telephone scripts. (7) The entity has agreed to participate and cooperate, and has required its subcontractors to participate and cooperate, in all oversight activities related to survey administration conducted by CMS or its contractors. (8) From January 1, 2019 through December 31, 2025, the entity has sent an interim survey data file to CMS that establishes the entity's ability to accurately report CAHPS data. (9) Beginning with January 1, 2026, the entity seeking to be a CMS-approved survey vendor must include on its application the range of costs of its third-party intermediary services. (10) Beginning with the CY 2027 performance period/2029 MIPS payment year, the CMS-approved survey vendor must administer the survey via a web-mail-phone protocol. (e) Remedial action and termination of third party intermediaries. (i) Require the third party intermediary to submit a corrective action plan (CAP) by a date specified by CMS. The CAP must address the following issues, unless different or additional information is specified by CMS: (A) The issues that contributed to the non-compliance. (B) The impact to individual clinicians, groups, virtual groups, subgroups, or APM Entities, regardless of whether they are participating in the program because they are MIPS eligible, voluntarily participating, or opting in to participating in the MIPS program, and any QCDRs that were granted licenses to the measures of a QCDR upon which a CAP has been imposed. (C) The corrective actions to be implemented by the third party intermediary to ensure that the non-compliance has been resolved and will not recur in the future. (D) The detailed timeline for achieving compliance with the applicable requirements. (E) The communication plan for communicating the impact to the parties identified in paragraph (e)(1)(i)(B) of this section. (F) Once the issue has been resolved, the detailed final resolution and an update, if any, to the monitoring plan provided pursuant to § 414.1400(e)(1)(i)(C). (ii) Publicly disclose as follows: (A) For the purposes of the CY 2025 performance period/2027 MIPS payment year and prior reporting periods and payment years, publicly disclose the entity's data error rate on the CMS website until the data error rate falls below 3 percent. (B) Beginning with the CY 2025 performance period/2027 MIPS payment year, publicly disclose on the CMS website that CMS took remedial action against or terminated the third party intermediary. (2) CMS may immediately or with advance notice terminate a third party intermediary for one or more of the following reasons: (i) CMS has grounds to impose remedial action; (ii) CMS has not received a CAP within the specified time-period or the CAP is not accepted by CMS; or (iii) The third party intermediary fails to correct the deficiencies or data errors by the date specified by CMS. (iv) The third party intermediary has not maintained current contact information for correspondence. (v) The third party intermediary is on remedial action for 2 consecutive years. (3) A data submission that contains data inaccuracies affecting the third party intermediary's clinicians may lead to remedial action/termination of the third party intermediary for future program year(s) based on CMS discretion. (4) For purposes of this paragraph (e), CMS may determine that submitted data are inaccurate, unusable, or otherwise compromised, if the submitted data includes, without limitation, TIN/NPI mismatches, formatting issues, calculation errors, or data audit discrepancies. (5) Beginning with the CY 2024 performance period/2026 MIPS payment year, a QCDR or qualified registry that submits a participation plan as required under paragraph (b)(3)(viii) of this section, but does not submit MIPS data for the applicable performance period for which they self-nominated under paragraph (b)(3)(viii) of this section, will be terminated. (f) Auditing of entities submitting MIPS data. [86 FR 65677, Nov. 19, 2021, as amended at 87 FR 70229, Nov. 18, 2022; 88 FR 79536, Nov. 16, 2023; 90 FR 50011, Nov. 5, 2025] § 414.1405 Payment. (a) General. (b) Performance threshold. (1) MIPS eligible clinicians with a final score at or above the performance threshold receive a zero or positive MIPS payment adjustment factor on a linear sliding scale such that an adjustment factor of 0 percent is assigned for a final score at the performance threshold and an adjustment factor of the applicable percent is assigned for a final score of 100. (2) MIPS eligible clinicians with a final score below the performance threshold receive a negative MIPS payment adjustment factor on a linear sliding scale such that an adjustment factor of 0 percent is assigned for a final score at the performance threshold and an adjustment factor of the negative of the applicable percent is assigned for a final score of 0; further, MIPS eligible clinicians with final scores that are equal to or greater than zero, but not greater than one-fourth of the performance threshold, receive a negative MIPS payment adjustment factor that is equal to the negative of the applicable percent. (3) A scaling factor not to exceed 3.0 may be applied to positive MIPS payment adjustment factors to ensure budget neutrality such that the estimated increase in aggregate allowed charges resulting from the application of the positive MIPS payment adjustment factors for the MIPS payment year equals the estimated decrease in aggregate allowed charges resulting from the application of negative MIPS payment adjustment factors for the MIPS payment year. (4) The performance threshold for the 2019 MIPS payment year is 3 points. (5) The performance threshold for the 2020 MIPS payment year is 15 points. (6) The performance threshold for the 2021 MIPS payment year is 30 points. (7) The performance threshold for the 2022 MIPS payment year is 45 points. (8) The performance threshold for the 2023 MIPS payment year is 60 points. (9) Pursuant to the methodology established at paragraph (g) of this section: (i) The performance threshold for the 2024 MIPS payment year is 75 points. The prior period used to determine the performance threshold is the 2019 MIPS payment year. (ii) The performance threshold for the 2025 MIPS payment year is 75 points. The prior period used to determine the performance threshold is the 2019 MIPS payment year. (iii) The performance threshold for the 2026 MIPS payment year is 75 points. The prior period to determine the performance threshold is the 2019 MIPS payment year. (10) Pursuant to the methodology established at paragraph (g)(2) of this section: (i) The performance threshold for the 2027 MIPS payment year is 75 points. The prior period used to determine the performance threshold is the 2019 MIPS payment year. (ii) The performance threshold for the 2028 through 2030 MIPS payment years is 75 points. The prior period used to determine the performance threshold is the 2019 MIPS payment year. (c) Applicable percent. (d) Additional performance threshold. (1) In addition to the MIPS payment adjustment factor, MIPS eligible clinicians with a final score at or above the additional performance threshold receive an additional MIPS payment adjustment factor for exceptional performance on a linear sliding scale such that an additional adjustment factor of 0.5 percent is assigned for a final score at the additional performance threshold and an additional adjustment factor of 10 percent is assigned for a final score of 100, subject to the application of a scaling factor as determined by CMS, such that the estimated aggregate increase in payments resulting from the application of the additional MIPS payment adjustment factors for the MIPS payment year shall not exceed $500,000,000 for each of the MIPS payment years 2019 through 2024. (2) [Reserved] (3) The additional performance threshold for the 2019 MIPS payment year is 70 points. (4) The additional performance threshold for the 2020 MIPS payment year is 70 points. (5) The additional performance threshold for the 2021 MIPS payment year is 75 points. (6) The additional performance threshold for the 2022 and 2023 MIPS payment years is 85 points. (7) The additional performance threshold for the 2024 MIPS payment year is 89 points. (e) Application of adjustments to payments. (f) Exception to application of MIPS payment adjustment factors to model-specific payments under section 1115A APMs. (1) Are made only to participants in a model tested under section 1115A of the Act; (2) Would otherwise be subject to the requirement to apply the MIPS payment adjustment factors if the payment is made with respect to a MIPS eligible clinician participating in a section 1115A model; and (3) Either have a specified payment amount or are paid according to a methodology for calculating a model-specific payment that is applied in a consistent manner to all model participants, such that application of the MIPS payment adjustment factors would potentially interfere with CMS's ability to effectively evaluate the impact of the APM. (g) Performance threshold methodology. (2) For each of the 2027, 2028, and 2029 MIPS payment years, the performance threshold is the mean of the final scores for all MIPS eligible clinicians from a prior period as specified under paragraph (b)(10) of this section. [81 FR 77537, Nov. 4, 2016, as amended at 82 FR 53960, Nov. 16, 2017; 83 FR 60089, Nov. 23, 2018; 84 FR 63200, Nov. 15, 2019; 86 FR 65681, Nov. 19, 2021; 87 FR 70229, Nov. 18, 2022; 88 FR 79538, Nov. 16, 2023; 89 FR 9784, Feb. 12, 2024; 89 FR 98564, Dec. 9, 2024; 90 FR 50012, Nov. 5, 2025] § 414.1410 Advanced APM determination. (a) General. (b) Advanced APM determination process. (1) Advanced APM determination. (ii) CMS updates the Advanced APM list on its Web site at intervals no less than annually. (iii) CMS will include notice of whether a new APM is an Advanced APM in the first public notice of the new APM. (2) [Reserved] [81 FR 77537, Nov. 4, 2016, as amended at 82 FR 53960, Nov. 16, 2017] § 414.1415 Advanced APM criteria. (a) Use of certified electronic health record technology (CEHRT) Required use of CEHRT. (i) For QP Performance Periods ending with 2018, require at least 50 percent, or for QP Performance Periods beginning with 2019 and ending with 2024, 75 percent, of eligible clinicians in each participating APM Entity group, or for APMs in which hospitals are the APM Entities, each hospital, to use CEHRT to document and communicate clinical care to their patients or health care providers; (ii) For QP Performance Periods prior to 2019, for the Shared Savings Program, apply a penalty or reward to an APM Entity based on the degree of the use of CEHRT of the eligible clinicians in the APM Entity; and (iii) For QP Performance Periods beginning with 2025, require use of CEHRT as defined at paragraph (3) under CEHRT at § 414.1305. (2) [Reserved]. (b) Payment based on quality measures. (2) At least one of the quality measures used in the payment arrangement as specified in paragraph (b)(1) of this section must: (i) For QP Performance Periods before January 1, 2020, have an evidence-based focus, be reliable and valid, and meet at least one of the following criteria: (A) Used in the MIPS quality performance category, as described in § 414.1330; (B) Endorsed by a consensus-based entity; (C) Developed under section 1848(s) of the Act; (D) Submitted in response to the MIPS Call for Quality Measures under section 1848(q)(2)(D)(ii) of the Act; or (E) Any other quality measures that CMS determines to have an evidence-based focus and to be reliable and valid; and (ii) For QP Performance Periods beginning on or after January1, 2020, be: (A) Finalized on the MIPS final list of measures, as described in § 414.1330; (B) Endorsed by a consensus-based entity; or (C) Determined by CMS to be evidenced-based, reliable, and valid. (3) The quality measures upon which an Advanced APM bases the payment in paragraph (b)(1) of this section must include at least one measure that is an outcome measure unless CMS determines that there are no available or applicable outcome measures included in the MIPS final quality measures list for the Advanced APM's first QP Performance Period. Beginning January 1, 2020, the included outcome measure must satisfy the criteria in paragraph (b)(2) of this section. (4) A single quality measure that meets the criteria under both paragraphs (b)(2) and (3) of this section may be used to satisfy the requirements of paragraph (b)(1) of this section. (c) Financial risk. (1) Generally applicable financial risk standard. (i) Withhold payment for services to the APM Entity or the APM Entity's eligible clinicians; (ii) Reduce payment rates to the APM Entity or the APM Entity's eligible clinicians; or (iii) Require the APM Entity to owe payment(s) to CMS. (2) Medical Home Model financial risk standard. (i) Withholds payment for services to the APM Entity or the APM Entity's eligible clinicians; (ii) Reduces payment rates to the APM Entity or the APM Entity's eligible clinicians; (iii) Requires the APM Entity to owe payment(s) to CMS; or (iv) Causes the APM Entity to lose the right to all or part of an otherwise guaranteed payment or payments. (3) Generally applicable nominal amount standard. (A) For QP Performance Periods beginning in 2023, 8 percent of the average estimated total Medicare Parts A and B revenue of all providers and suppliers in participating APM Entities; or (B) 3 percent of the expected expenditures for which an APM Entity is responsible under the APM. (ii) [Reserved] (4) Medical Home Model nominal amount standard. (A) For QP Performance Period 2017, 2.5 percent of the average estimated total Medicare Parts A and B revenue of all providers and suppliers in participating APM Entities. (B) For QP Performance Period 2018, 2.5 percent of the average estimated total Medicare Parts A and B revenue of all providers and suppliers in participating APM Entities. (C) For QP Performance Period 2019, 3 percent of the average estimated total Medicare Parts A and B revenue of all providers and suppliers in participating APM Entities. (D) For QP Performance Period 2020, 4 percent of the average estimated total Medicare Parts A and B revenue of all providers and suppliers in participating APM Entities. (E) For QP Performance Periods 2021 and later, 5 percent of the average estimated total Medicare Parts A and B revenue of all providers and suppliers in participating APM Entities. (ii) [Reserved] (5) For the purposes of this section, expected expenditures means the beneficiary expenditures for which an APM Entity is responsible under an APM. For episode payment models, expected expenditures means the episode target price. For purposes of assessing financial risk for Advanced APM determinations, the expected expenditures under the terms of the APM should not exceed the Medicare Part A and Part B expenditures for a participant in the absence of the APM. If the expected expenditures under the APM exceed the Medicare Part A and Part B expenditures that an APM Entity would be expected to incur in the absence of the APM, such excess expenditures are not considered when CMS assesses financial risk under the APM for purposes of Advanced APM determinations. (6) Capitation. (7) Medical Home Model 50 eligible clinician limit. [81 FR 77537, Nov. 4, 2016, as amended at 82 FR 53960, Nov. 16, 2017; 83 FR 60090, Nov. 23, 2018; 84 FR 540, Jan. 31, 2019; 84 FR 63200, Nov. 15, 2019; 87 FR 70229, Nov. 18, 2022; 88 FR 79538, Nov. 16, 2023; 90 FR 50012, Nov. 5, 2025] § 414.1420 Other payer advanced APM criteria. (a) Other Payer Advanced APM criteria. (1) Use of CEHRT, as described in paragraph (b) of this section; (2) Quality measures comparable to measures under the MIPS quality performance category apply, as described in paragraph (c) of this section; and (3) Either: (i) Requires APM Entities to bear more than nominal financial risk if actual aggregate expenditures exceed expected aggregate expenditures as described in paragraph (d) of this section; or (ii) Is a Medicaid Medical Home Model that meets criteria comparable to Medical Home Models expanded under section 1115A(c) of the Act as described in paragraph (d) of this section. (b) Use of CEHRT. (1) CEHRT must be used, for QP Performance Periods ending with 2019, by at least 50 percent; and for QP Performance Periods for 2020 through 2024, by at least 75 percent, of participants in each participating APM Entity group, or each hospital if hospitals are the APM Entities, in the other payer arrangement to document and communicate clinical care; and (2) For QP Performance Periods beginning on or after January 1, 2024, use of CEHRT (as defined in § 414.1305, paragraph (3) in the definition of “Certified Electronic Health Record Technology (CEHRT)”), must be a requirement of participation in the APM. (c) Use of quality measures. (2) At least one of the quality measures used in the payment arrangement as specified in paragraph (c)(1) of this section must: (i) For QP Performance Period before January 1, 2020, have an evidence-based focus, be reliable and valid, and meet at least one of the following criteria: (A) Used in the MIPS quality performance category, as described in § 414.1330; (B) Endorsed by a consensus-based entity; (C) Developed under section 1848(s) of the Act; (D) Submitted in response to the MIPS Call for Quality Measures under section 1848(q)(2)(D)(ii) of the Act; or (E) Any other quality measures that CMS determines to have an evidence-based focus and to be reliable and valid; and (ii) For QP Performance Periods beginning on or after January 1, 2020, be: (A) Finalized on the MIPS final list of measures, as described in § 414.1330; (B) Endorsed by a consensus-based entity; or (C) Determined by CMS to be evidenced-based, reliable, and valid. (3) To meet the quality measure use criterion under paragraph (c)(1) of this section, a payment arrangement must: (i) For QP Performance Periods before January 1, 2020, use an outcome measure if there is an applicable outcome measure on the MIPS quality measure list. This criterion also applies for payment arrangements determined to be Other Payer Advanced APMs on or before January 1, 2020, but only for the Other Payer Advanced APM determination made with respect to the arrangement for the CY 2020 QP Performance Period (regardless of whether that determination is a single- or multi-year determination). (ii) For QP Performance Periods on or after January 1, 2020, use at least one measure that is an outcome measure and meets the criteria in paragraph (c)(2)(ii) of this section if there is such an applicable outcome measure on the MIPS quality measure list. (4) A single quality measure that meets the criteria under both paragraphs (c)(2) and (3) of this section may be used to satisfy the requirements of paragraph (c)(1) of this section. (d) Financial risk. (1) Generally applicable financial risk standard. (i) Withhold payment for services to the APM Entity or the APM Entity's eligible clinicians; (ii) Reduce payment rates to the APM Entity or the APM Entity's eligible clinicians; or (iii) Require direct payment by the APM Entity to the payer. (2) Medicaid Medical Home Model and Aligned Other Payer Medical Home Model financial risk standard. (i) Withhold payment for services to the APM Entity or the APM Entity's eligible clinicians; (ii) Require direct payment by the APM Entity to the payer; (iii) Reduce payment rates to the APM Entity or the APM Entity's eligible clinicians; or (iv) Require the APM Entity to lose the right to all or part of an otherwise guaranteed payment or payments. (3) Generally applicable nominal amount standard. (i) For QP Performance Periods beginning in 2023, 8 percent of the total combined revenues from the payer to providers and other entities under the payment arrangement if financial risk is expressly defined in terms of revenue; or, 3 percent of the expected expenditures for which an APM Entity is responsible under the payment arrangement. (ii) Except for risk arrangements described under paragraph (d)(2) of this section, the risk arrangement must have a marginal risk rate of at least 30 percent. (4) Medicaid Medical Home Model and Aligned Other Payer Medical Home Model nominal amount standard. (i) For QP Performance Period 2019, 3 percent of the average estimated total revenue of the participating providers or other entities under the payer. (ii) For QP Performance Period 2020, 4 percent of the average estimated total revenue of the participating providers or other entities under the payer. (iii) For QP Performance Periods 2021 and later, 5 percent of the average estimated total revenue of the participating providers or other entities under the payer. (5) Marginal risk rate. (i) In the event that the marginal risk rate varies depending on the amount by which actual expenditures exceed expected expenditures, the average marginal risk rate across all possible levels of actual expenditures would be used for comparison to the marginal risk rate specified in paragraph (d)(3)(ii) of this section, with exceptions for large losses as described in paragraph (d)(5)(ii) of this section and small losses as described in paragraph (d)(5)(iii) of this section. (ii) Allowance for large losses. (iii) Allowance for minimum loss rate. (6) Expected expenditures. (7) Capitation. (8) Aligned Other Payer Medical Home Model and Medicaid Medical Home Model 50 eligible clinician limit. [81 FR 77537, Nov. 4, 2016, as amended at 82 FR 53961, Nov. 16, 2017; 83 FR 23610, May 22, 2018; 83 FR 60090, Nov. 23, 2018; 84 FR 63200, Nov. 15, 2019; 87 FR 70230, Nov. 18, 2022; 88 FR 79539, Nov. 16, 2023; 90 FR 50012, Nov. 5, 2025] § 414.1425 Qualifying APM participant determination: In general. (a) List used for QP determination. (2) For Advanced APMs in which APM Entities do not include eligible clinicians on a Participation List but do include eligible clinicians on an Affiliated Practitioner List, the Affiliated Practitioner List is used to identify the eligible clinicians for purposes of QP determinations. (3) For Advanced APMs in which some APM Entities may include eligible clinicians on a Participation List and other APM Entities may only include eligible clinicians on an Affiliated Practitioner List depending on the type of APM Entity, paragraph (a)(1) of this section applies to APM Entities that may include eligible clinicians on a Participation List, and paragraph (a)(2) of this section applies to APM Entities that may only include eligible clinicians on an Affiliated Practitioner List. (b) Group or individual determination under the Medicare Option. (1) APM Entity group determination. (2) Affiliated practitioner individual determination under the Medicare Option. (3) For QP Performance Periods beginning with 2026, except for paragraphs (b)(1) and (b)(2) of this section and as set forth in § 414.1440, for purposes of the QP determinations, CMS performs QP determinations for the eligible clinicians three times during the QP Performance Period using claims data for services furnished from January 1 through each of the respective QP determination dates: March 31, June 30, and August 31. An eligible clinician can be determined to be a QP only if the eligible clinician appears on the Participation List on a date (March 31, June 30, or August 31) CMS uses based on participation in the Advanced APM. (c) QP determination. (2) An eligible clinician cannot be both a QP and a Partial QP for a year. A determination that an eligible clinician is a QP means that the eligible clinician is not a Partial QP. (3) An eligible clinician is a QP for a year under the Medicare Option if— (i) Starting with the CY 2017 QP Performance Period and ending with the CY 2025 QP Performance Period, the eligible clinician is in an APM Entity group that achieves a Threshold Score that meets or exceeds the corresponding QP payment amount threshold or QP patient count threshold for that QP Performance Period as described in § 414.1430(a)(1) and (3). An eligible clinician is a QP for the year under the All-Payer Combination Option if the eligible clinician individually, or as part of an APM Entity group, achieves a Threshold Score that meets or exceeds the corresponding QP payment amount threshold or QP patient count threshold for that QP Performance Period as described in § 414.1430(b)(1) and (3). (ii) Beginning with the CY 2026 QP Performance Period, the eligible clinician individually, or as part of an APM Entity group, achieves a Threshold Score that meets or exceeds the corresponding QP payment amount threshold or QP patient count threshold for that QP Performance Period as described in § 414.1430(a)(1) and (3). An eligible clinician is a QP for the year under the All-Payer Combination Option if the eligible clinician individually, or as part of an APM Entity group, achieves a Threshold Score that meets or exceeds the corresponding QP payment amount threshold or QP patient count threshold for that QP Performance Period as described in § 414.1430(b)(1) and (3). (4) Starting with the CY 2017 QP Performance Period and ending with the CY 2025 QP Performance Period, notwithstanding paragraph (c)(3) of this section, an eligible clinician is a QP for a year if— (i) The eligible clinician is included in more than one APM Entity group and none of the APM Entity groups in which the eligible clinician is included meets the QP payment amount threshold or the QP patient count threshold, or the eligible clinician is an Affiliated Practitioner; and (ii) CMS determines that the eligible clinician individually achieves a Threshold Score that meets or exceeds the QP payment amount threshold or the QP patient count threshold. (5) Beginning in the 2020 QP Performance Period, an eligible clinician in an APM Entity is not a QP for a year if: (i) The APM Entity voluntarily or involuntarily terminates from an Advanced APM before the end of the QP Performance Period; or (ii) The APM Entity voluntarily or involuntarily terminates from an Advanced APM at a date on which the APM Entity would not bear financial risk for that QP performance period under the terms of the Advanced APM, even if such termination date occurs within such QP Performance Period. (6) Beginning in the 2020 QP Performance Period, an eligible clinician is not a QP for a year if: (i) One or more of the APM Entities in which the eligible clinician participates voluntarily or involuntarily terminates from the Advanced APM before the end of the QP Performance Period, and the eligible clinician does not achieve a Threshold Score that meets or exceeds the QP payment amount threshold or QP patient count threshold based on participation in the remaining non-terminating APM Entities; or (ii) One or more of the APM Entities in which the eligible clinician participates voluntarily or involuntarily terminates from the Advanced APM at a date on which the APM Entity would not bear financial risk under the terms of the Advanced APM, and the eligible clinician does not achieve a Threshold Score that meets or exceeds the QP payment amount threshold or QP patient count threshold based on participation in the remaining non-terminating APM Entities. (7) Advanced APMs that start or end during the QP Performance Period: (i) Notwithstanding paragraph (a) of this section and §§ 414.1435 and 414.1440, CMS makes QP determinations and Partial QP determinations for the APM Entity group or individual eligible clinician under § 414.1425(b) for Advanced APMs that start or end during the QP Performance Period and that are actively tested for 60 or more continuous days during the QP Performance Period using claims data for services furnished during those dates on which the Advanced APM is actively tested. For Advanced APMs that start active testing during the QP Performance Period, CMS performs QP and Partial QP determinations during the QP Performance Period using claims data for services furnished from the start of active testing of the Advanced APM through each of the QP determination dates that occur on or after the Advanced APM has been actively tested for 60 or more continuous days: March 31, June 30, and August 31. For Advanced APMs that end active testing during the QP Performance Period, CMS performs QP and Partial QP determinations using claims data for services furnished from January 1 or the start of active testing, whichever occurs later, through the final day of active testing of the Advanced APM for each of the QP determination dates that occur on or after the Advanced APM has been actively tested for 60 or more continuous days during that QP Performance Period: March 31, June 30, and August 31. (ii) For QP determinations specified under paragraph (c)(4) of this section and Partial QP determinations under paragraph (d)(2) of this section, QP determinations are made using claims data for the full QP Performance Period even if the eligible clinician participates in one or more Advanced APMs that start or end during the QP Performance Period. (d) Partial QP determination. (i) Starting with the CY 2017 QP Performance Period and ending with the CY 2025 QP Performance Period, the eligible clinician is in an APM Entity group that achieves Threshold Score that meets or exceeds the corresponding Partial QP payment amount threshold or Partial QP patient count threshold for that QP Performance Period as described in § 414.1430(a)(2) and (4). An eligible clinician is a Partial QP for the year under the All-Payer Combination Option if the eligible clinician achieves individually, or as part of an APM Entity group, a Threshold Score that meets or exceeds the corresponding Partial QP payment amount threshold or Partial QP patient count threshold for that QP Performance Period as described in § 414.1430(b)(2) and (4). (ii) Beginning with the CY 2026 QP Performance Period, the eligible clinician individually, or as part of an APM Entity group, achieves a Threshold Score that meets or exceeds the corresponding Partial QP payment amount threshold or Partial QP patient count threshold for that QP Performance Period as described in § 414.1430(a)(2) and (4). An eligible clinician is a Partial QP for the year under the All-Payer Combination Option if the eligible clinician achieves individually, or as part of an APM Entity group, a Threshold Score that meets or exceeds the corresponding Partial QP payment amount threshold or Partial QP patient count threshold for that QP Performance Period as described in § 414.1430(b)(2) and (4). (2) Starting with the CY 2017 QP Performance Period and ending with the CY 2025 QP Performance Period, notwithstanding paragraph (d)(1) of this section, an eligible clinician is a Partial QP for a year if— (i) The eligible clinician is included in more than one APM Entity group and none of the APM Entity groups in which the eligible clinician is included meets the corresponding QP or Partial QP threshold, or the eligible clinician is an Affiliated Practitioner; and (ii) CMS determines that the eligible clinician individually achieves a Threshold Score that meets or exceeds the corresponding Partial QP Threshold. (3) Beginning in the 2020 QP Performance Period, an eligible clinician is not a Partial QP for a year if: (i) The APM Entity voluntarily or involuntarily terminates from an Advanced APM before the end of the QP Performance Period; or (ii) The APM Entity voluntarily or involuntarily terminates from an Advanced APM at a date on which the APM Entity would not bear financial risk for that performance period under the terms of the Advanced APM. (4) Beginning in the 2020 QP Performance Period, an eligible clinician is not a Partial QP for a year if: (i) One or more of the APM Entities in which the eligible clinician participates voluntarily or involuntarily terminates from the Advanced APM before the end of the QP Performance Period, and the eligible clinician does not achieve a Threshold Score that meets or exceeds the Partial QP payment amount threshold or Partial QP patient count threshold based on participation in the remaining non-terminating APM Entities; or (ii) One or more of the APM Entities in which the eligible clinician participates voluntarily or involuntarily terminates from the Advanced APM at a date on which the APM Entity would not bear financial risk under the terms of the Advanced APM, and the eligible clinician does not achieve a Threshold Score that meets or exceeds the Partial QP payment amount threshold or Partial QP patient count threshold based on participation in the remaining non-terminating APM Entities. (e) Notification of QP determination. (f) Order of threshold options. (2) For payment years 2021 and later, CMS performs QP determinations for eligible clinicians under the Medicare Option, as described in § 414.1435 and, except as specified in paragraphs (d)(2)(i) and (ii) of this section, the All-Payer Combination Option, described in § 414.1440. (i) If CMS determines the eligible clinician to be a QP under the Medicare Option, then CMS does not calculate a Threshold Score for such eligible clinician under the All-Payer Combination Option. (ii) If the Threshold Score for an eligible clinician under the Medicare Option is less than the amount specified in § 414.1430(b)(2)(ii) and (b)(3)(iii), then CMS does not perform a QP determination for such eligible clinician(s) under the All-Payer Combination Option. [81 FR 77537, Nov. 4, 2016, as amended at 82 FR 53961, Nov. 16, 2017; 84 FR 63201, Nov. 15, 2019; 90 FR 50012, Nov. 5, 2025] § 414.1430 Qualifying APM participant determination: QP and partial QP thresholds. (a) Medicare Option QP payment amount threshold. (i) 2019 and 2020: 25 percent. (ii) 2021 and 2022: 50 percent. (iii) 2023 and 2024: 50 percent. (iv) 2025: 50 percent. (v) 2026: 50 percent. (vi) 2027 and later: 75 percent. (2) Partial QP payment amount threshold. (i) 2019 and 2020: 20 percent. (ii) 2021 and 2022: 40 percent. (iii) 2023 and 2024: 40 percent. (iv) 2025: 40 percent. (v) 2026: 40 percent. (vi) 2027 and later: 50 percent. (3) QP patient count threshold. (i) 2019 and 2020: 20 percent (ii) 2021 and 2022: 35 percent (iii) 2023 and 2024: 35 percent. (iv) 2025: 35 percent. (v) 2026: 35 percent. (vi) 2027 and later: 50 percent. (4) Partial QP patient count threshold. (i) 2019 and 2020: 10 percent (ii) 2021 and 2022: 25 percent (iii) 2023 and 2024: 25 percent. (iv) 2025: 25 percent. (v) 2026: 25 percent. (vi) 2027 and later: 35 percent. (b) All-Payer Combination Option QP payment amount threshold. (i) The QP payment amount thresholds are the following values for the indicated payment years: (A) 2021 through 2026: 50 percent. (B) 2027 and later: 75 percent. (ii) To meet the QP payment amount threshold under this option, the eligible clinician must also meet a 25 percent QP payment amount threshold under the Medicare Option. (2) Partial QP payment amount threshold. (A) 2021 through 2026: 40 percent. (B) 2027 and later: 50 percent. (ii) To meet the QP payment amount threshold under this option, the eligible clinician must also meet a 20 percent Partial QP payment amount threshold under the Medicare Option. (3) QP patient count threshold. (A) 2021 through 2026: 35 percent. (B) 2027 and later: 50 percent. (ii) To meet the QP patient count threshold under this option, the eligible clinician must also meet a 20 percent QP patient count threshold under the Medicare Option. (4) Partial QP patient count threshold. (A) 2021 through 2026: 25 percent. (B) 2027 and later: 35 percent. (ii) To meet the Partial QP patient count threshold under this option, the eligible clinician group or eligible clinician must also meet a 10 percent QP patient count threshold under the Medicare Option. [81 FR 77537, Nov. 4, 2016, as amended at 86 FR 65681, Nov. 19, 2021; 87 FR 70230, Nov. 18, 2022; 88 FR 79539, Nov. 16, 2023; 89 FR 98564, Dec. 9, 2024] § 414.1435 Qualifying APM participant determination: Medicare option. (a) Payment amount method. paragraph (a)(1) paragraph (a)(2) (1) Numerator. (2) Denominator. (3) Claims and adjustments. paragraphs (a)(1) (2) § 414.1450. (b) Patient count method. paragraph (b)(1) paragraph (b)(2) (1) Numerator. (2) Denominator. (3) Unique beneficiaries. (4) Beneficiaries count multiple times. (c) Covered Professional Service Payment amount method. paragraph (c)(1) paragraph (c)(2) (1) Numerator. (2) Denominator. (3) Claims and adjustments. paragraphs (c)(1) (2) § 414.1450. (d) Covered Professional Service Patient count method. paragraph (e)(1) paragraph (d)(2) (1) Numerator. (2) Denominator. (3) Unique beneficiaries. (4) Beneficiaries count multiple times. (e) E/M Payment amount method. paragraph (e)(1) paragraph (e)(2) (1) Numerator. (2) Denominator. (3) Claims and adjustments. paragraphs (e)(1) (2) § 414.1450. (f) E/M Patient count method. paragraph (f)(1) paragraph (f)(2) (1) Numerator. (2) Denominator. (3) Unique beneficiaries. (4) Beneficiaries count multiple times. (g) Attribution. (1) Attributed beneficiaries are determined from each Advanced APM Entity's attributed beneficiary lists generated by each Advanced APM's specific attribution methodology except as set forth in paragraph (g)(1) (i) Beneficiaries who have been prospectively attributed to an APM Entity for a QP Performance Period will be excluded from the attribution-eligible beneficiary count for any other APM Entity that is participating in an APM where that beneficiary would be ineligible to be added to the APM Entity's attributed beneficiary list. (ii) [Reserved] (2) When operationally feasible, this attributed beneficiary list will be the final beneficiary list used for reconciliation purposes in the Advanced APM. (3) When it is not operationally feasible to use the final attributed beneficiary list, the attributed beneficiary list will be taken from the Advanced APM's most recently available attributed beneficiary list at the end of the QP Performance Period. (h) Use of methods. (i) For QP status determination through QP performance period 2025, both the payment amount and patient count methods described in paragraphs (a) and (b) of this section for each QP Performance Period. (ii) For QP status determination starting with QP performance period 2026, all of the methods described in paragraphs (c) through (f) of this section for each QP Performance Period. (2) CMS assigns to the eligible clinicians included in the APM Entity group or to the eligible clinician the score that results in the greater QP status. QP status is greater than Partial QP status, and Partial QP status is greater than no QP status. [90 FR 50013, Nov. 5, 2025, as amended at 91 FR 12080, Mar. 12, 2026] § 414.1440 Qualifying APM participant determination: All-payer combination option. (a) Payments excluded from calculations. (i) The Secretary of Defense for the costs of Department of Defense health care programs; (ii) The Secretary of Veterans Affairs for the cost of Department of Veterans Affairs health care programs; and (iii) Under Title XIX in a State in which no Medicaid APM or Medicaid Medical Home Model that is an Other Payer Advanced APM is available. (2) Payments and associated patient counts under paragraph (a)(1)(iii) of this section are included in the numerator and denominator as specified in paragraphs (b)(2) and (3) and paragraphs (c)(2) and (3) of this section for an eligible clinician if CMS determines that there is at least one Medicaid APM or Medicaid Medical Home Model that is an Other Payer Advanced APM available in the county where the eligible clinician sees the most patients during the QP Performance Period, and that the eligible clinician is not ineligible to participate in the Other Payer Advanced APM based on their specialty. (b) Payment amount method In general. (2) Numerator. (3) Denominator. (c) Patient count method In general. (2) Numerator. (3) Denominator. (4) Unique patients. (d) QP Determinations under the All-Payer Combination Option. (2) An APM Entity may request that CMS make QP determinations at the APM Entity level, an eligible clinician may request that CMS make QP determinations at the eligible clinician level, and an eligible clinician or an APM Entity may request that CMS makes QP determinations at the TIN-level in instances where all clinicians who reassigned billing rights to the TIN are participating in a single APM Entity. CMS makes QP determinations at either the APM Entity, eligible clinician, or TIN level. Eligible clinicians assessed at the eligible clinician level under the Medicare Option at § 414.1425(b)(2) will be assessed at the eligible clinician level only under the All-Payer Combination Option. Eligible Clinicians may meet the Medicare and the All-Payer Combination Option thresholds using the payment amount method for both thresholds, the patient account method for both thresholds, or the payment amount method for one threshold and the patient account method for the other threshold. (3) CMS uses data at the same level for the Medicare and other payer portions of Threshold Score calculations under the All-Payer Combination Option. When QP determinations are made at the eligible clinician or, at the TIN level when all clinicians who have reassigned billing rights to the TIN are included in a single APM Entity; and if the Medicare Threshold score for the APM Entity group is higher than when calculated for the eligible clinician or TIN, CMS makes QP determinations using a weighted Medicare Threshold Score that is factored into an All-Payer Combination Option Threshold Score. (e) Information used to calculate Threshold Scores under the All-Payer Combination Option. (2) To request a QP determination under the All-Payer Combination Option, for each payment arrangement submitted as set forth in paragraph (e)(1) of this section, the APM Entity or eligible clinician must include: (i) The amount of revenue for services furnished through the payment arrangement, the total revenue received from all payers except those excluded as provided in paragraph (a)(2) of this section, the number of patients furnished any service through the arrangement, and the total number of patients furnished any services, except those excluded as provided in paragraph (a)(2) of this section; and (ii) In the case of an APM Entity or eligible clinician requesting a QP determination under either a Medicaid Medical Home Model or Aligned Other Payer Medical Home Model pursuant to the criteria in § 414.1420, information specified by CMS for purposes of compliance with the 50 eligible clinician limit specified at § 414.1420(d)(8). (3) An APM Entity or eligible clinician must submit the information specified in paragraph (e)(2) of this section in a form and manner specified by CMS. An APM Entity or eligible clinician may submit the information specified in paragraph (e)(2) of this section for the following periods of time in the relevant QP Performance Period: January 1 through March 31, January 1 through June 30, and January 1 through August 31. (4) To request a QP determination under the All-Payer Combination Option, an APM Entity or eligible clinician must submit this information to CMS no later than the QP Determination Submission Deadline, which is December 1 of the calendar year that is 2 years prior to the payment year. (f) Requirement to submit sufficient information Sufficient Information. (2) Certification. (g) Notification of QP determination. [81 FR 77537, Nov. 4, 2016, as amended at 82 FR 53963, Nov. 16, 2017; 83 FR 60091, Nov. 23, 2018; 87 FR 70230, Nov. 18, 2022] § 414.1445 Determination of other payer advanced APMs. (a) Determination of Medicaid APMs. (b) Determination of Other Payer Advanced APMs Payer initiated Other Payer Advanced APM determination process. (2) Eligible clinician initiated Other Payer Advanced APM determination process. (c) Information required for Other Payer Advanced APM determinations. (2) If an eligible clinician submits information showing that a payment arrangement requires that the eligible clinician must use CEHRT as defined in § 414.1305 to document and communicate clinical care, CMS will presume that the CEHRT criterion in § 414.1420(b) is satisfied for that payment arrangement. (i) Based on the submission by an eligible clinician or payer of evidence that CMS determines sufficiently demonstrates that CEHRT is used as specified in § 414.1420(b) by participants in the payment arrangement, CMS will consider the CEHRT criterion in § 414.1420(b) is satisfied for that payment arrangement. (ii) [Reserved] (3) If a payment arrangement has no outcome measure, the payer, APM Entity, or eligible clinician requesting a determination of whether a payment arrangement meets the Other Payer Advanced APM criteria must certify that there is no available or applicable outcome measure on the MIPS measure list. (d) Certification. (e) Timing of Other Payer Advanced APM determinations. (f) Notification of Other Payer Advanced APM determinations. [82 FR 53964, Nov. 16, 2017, as amended at 83 FR 60091, Nov. 23, 2018] § 414.1450 APM incentive payment. (a) In general. (i) For payment years 2019 through 2026, CMS makes a lump sum payment to QPs in the amount described in paragraph (b) of this section in the manner described in paragraphs (d) and (e) of this section. (ii) [Reserved] (2) CMS provides notice of the amount of the APM Incentive Payment to QPs as soon as practicable following the calculation and validation of the APM Incentive Payment amount, but in any event no later than 1 year after the incentive payment base period. (b) APM Incentive Payment amount. (1) For payment years 2019 through 2024, the amount of the APM Incentive Payment is equal to 5 percent, with respect to payment year 2025, 3.5 percent, or with respect to payment year 2026, 1.88 percent of the estimated aggregate payments for covered professional services as defined in section 1848(k)(3)(A) of the Act furnished during the calendar year immediately preceding the payment year. CMS uses the paid amounts on claims for covered professional services to calculate the estimated aggregate payments on which CMS will calculate the APM Incentive Payment. (2) The estimated aggregate payment amount for covered professional services includes all such payments to any and all of the TIN/NPI combinations associated with the NPI of the QP. (3) In calculating the estimated aggregate payment amount for a QP, CMS uses claims submitted with dates of service from January 1 through December 31 of the incentive payment base period, and processing dates of January 1 of the base period through March 31 of the subsequent payment year. (4) The payment adjustment amounts, negative or positive, as described in sections 1848(m), (o), (p), and (q) of the Act are not included in calculating the APM Incentive Payment amount. (5) Incentive payments made to eligible clinicians under sections 1833(m), (x), and (y) of the Act are not included in calculating the APM Incentive Payment amount. (6) Financial risk payments such as shared savings payments or net reconciliation payments are excluded from the amount of covered professional services in calculating the APM Incentive Payment amount. (7) Supplemental service payments in the amount of covered professional services are included in calculating the APM Incentive Payment amount according to this paragraph (b). Supplemental service payments are included in the amount of covered professional services when calculating the APM Incentive Payment amount when the supplemental service payment meets the following four criteria: (i) Is payment for services that constitute physicians services authorized under section 1832(a) and defined under section 1861(s) of the Act. (ii) Is made for only Part B services under the criterion in paragraph (b)(9)(i) of this section. (iii) Is directly attributable to services furnished to an individual beneficiary. (iv) Is directly attributable to an eligible clinician, including an eligible clinician that is a group of individual eligible clinicians. (8) For payment amounts that are affected by a cash flow mechanism, the payment amounts that would have occurred if the cash flow mechanism were not in place are used in calculating the APM Incentive Payment amount. (c) APM Incentive Payment recipient. (1) Any TIN associated with the QP that, during the QP Performance Period, is associated with an APM Entity through which the eligible clinician achieved QP status; (2) Any TIN associated with the QP that, during the APM Incentive Payment base period, is associated with an APM Entity through which the eligible clinician achieved QP status; (3) Any TIN associated with the QP that, during the APM Incentive Payment base period, is associated with an APM Entity participating in an Advanced APM through which the eligible clinician had achieved QP status; (4) Any TIN associated with the QP that, during the APM Incentive Payment base period, participated in an APM Entity in an Advanced APM; (5) Any TIN associated with the QP that, during the APM Incentive Payment base period, participated with an APM Entity in any track of the APM through which the eligible clinician achieved QP status; (6) Any TIN associated with the QP that, during the APM Incentive Payment base period, participated with an APM Entity in an APM other than an Advanced APM; (7) Any TIN associated with the QP that submitted a claim for covered professional services furnished by the QP during the APM Incentive Payment base period, even if such TIN has no relationship to any APM Entity or APM; then (8) If we have not identified any TIN associated with the QP to which we can make the APM Incentive Payment, we will attempt to contact the QP via a public notice to request their Medicare payment information. The QPs identified in the public notice, or any other eligible clinicians who believe that they are entitled to an APM Incentive Payment must then notify CMS of their claim as directed in the public notice by September 1 of the payment year, or 60 days after CMS announces that initial payments for the year have been made, whichever is later. After that time, any claims by a QP to an APM Incentive Payment will be forfeited for such payment year. (d) Timing of the APM Incentive Payment. (e) Treatment of APM Incentive Payment amount in APMs. (2) APM Incentive Payments made under this section are not included in calculations for the purposes of rebasing benchmarks in an APM. (f) Treatment of APM Incentive Payment for other Medicare incentive payments and payment adjustments. [81 FR 77537, Nov. 4, 2016, as amended at 85 FR 85035, Dec. 28, 2020; 86 FR 65681, Nov. 19, 2021; 87 FR 70230, Nov. 18, 2022; 88 FR 79539, Nov. 16, 2023; 89 FR 98564, Dec. 9, 2024] § 414.1455 Limitation on review. (a) There is no right to administrative or judicial review under sections 1869, 1878, or otherwise, of the Act of the following: (1) The determination that an eligible clinician is a QP or Partial QP under § 414.1425. (2) The determination of the amount of the APM Incentive Payment under § 414.1450, including any estimation as part of such determination. (b)(1) An eligible clinician or APM Entity may request targeted review of a QP or Partial QP determination only if they believe in good faith that, due to a CMS clerical error, an eligible clinician was omitted from a Participation List. (2) If CMS determines that there was such a clerical error, if the QP determination for the eligible clinician would have been made at the APM Entity level under § 414.1425(b)(1), CMS will assign to the eligible clinician the most favorable QP status that was determined at the APM Entity level on any snapshot dates for the relevant QP Performance Period on which the eligible clinician participated in the APM Entity. (3) The process for targeted review is as follows: (i) An eligible clinician or APM Entity may submit a request for targeted review. (ii) All requests for targeted review must be submitted during the targeted review request submission period as described at § 414.1385(a)(2). The targeted review request submission period may be extended as specified by CMS. (iii) All requests for targeted review must be submitted in accordance with the form and manner specified by CMS. (iv) A request for targeted review may be denied if the request is duplicative of another request for a targeted review; the request is not submitted during the targeted review request submission period; or the request is outside the scope of targeted review specified in this section. If the targeted review request is denied, CMS will make no changes to the QP status of the eligible clinician for whom targeted review was requested. (v) CMS will respond to each timely submitted request for targeted review. (vi) A request for targeted review may include additional information in support of the request at the time it is submitted. CMS may also request additional information from the requestor. If CMS requests additional information relating to the eligible clinician or the APM Entity group that is the subject of a request for targeted review, responsive information must be provided and received by CMS within 15 days of the request. If CMS does not receive a timely response to a request for additional information, CMS may make a final decision on the targeted review request based on the information available. (vii) If targeted review requests reveal a pattern of CMS error with impacts that extend beyond the scope of eligible clinicians or APM Entities that submitted such targeted review requests, CMS may adjust the QP status of other affected eligible clinicians as provided in paragraph (b)(2) of this section. (viii) Decisions on a targeted review request are final, and not subject to any further administrative or judicial review in accordance with paragraph (a) of this section. [85 FR 85035, Dec. 28, 2020, as amended at 90 FR 50014, Nov. 5, 2025] § 414.1460 Monitoring and program integrity. (a) Vetting eligible clinicians. (b) Rescinding QP Determinations. (1) Any of the information CMS relied on in making the QP determination was inaccurate or misleading. (2) The QP is terminated from an Advanced APM or Other Payer Advanced APM during the QP Performance Period or Incentive Payment Base Period; or (3) The QP is found to be in violation of the terms of the relevant Advanced APM or any relevant Federal, State, or tribal statute or regulation during the QP Performance Period or Incentive Payment Base Period. (c) Information submitted for All-Payer Combination Option. (d) Reducing, denying, and recouping of APM Incentive Payments. (i) Who CMS determines is not in compliance with all Medicare conditions of participation and the terms of the relevant Advanced APM in which they participate during the QP Performance Period or Incentive Payment Base Period; (ii) Who is terminated by an APM or Advanced APM during the QP Performance Period or Incentive Payment Base Period; or (iii) Whose APM Entity is terminated by an APM or Advanced APM for non-compliance with any Medicare condition of participation or the terms of the relevant Advanced APM in which they participate during the QP Performance Period or Incentive Payment Base Period. (2) CMS may reopen, revise, and recoup an APM Incentive Payment that was made in error in accordance with procedures similar to those set forth at §§ 405.980 through § 405.986 and §§ 405.370 through 405.379 of this chapter or as established under the relevant APM. (e) Maintenance of records. (2) An APM Entity or eligible clinician that submits information to CMS under § 414.1445 for assessment under the All-Payer Combination Option or § 414.1440 for QP determinations must maintain such books, contracts, records, documents, and other evidence as necessary to enable the audit of an Other Payer Advanced APM determination, QP determinations, and the accuracy of APM Incentive Payments for a period of 6 years from the end of the QP Performance Period or from the date of completion of any audit, evaluation, or inspection, whichever is later. (3) A payer, APM Entity or eligible clinician that submits information to CMS under §§ 414.1440 or 414.1445 must provide such information and supporting documentation to CMS upon request. (f) OIG authority. [81 FR 77537, Nov. 4, 2016, as amended at 82 FR 53965, Nov. 16, 2017] § 414.1465 Physician-focused payment models. (a) Definition. (1) In which Medicare is a payer; (2) In which eligible clinicians that are eligible professionals as defined in section 1848(k)(3)(B) of the Act are participants and play a core role in implementing the APM's payment methodology; and (3) Which targets the quality and costs of services that eligible professionals participating in the Alternative Payment Model provide, order, or can significantly influence. (b) Criteria. (1) Incentives: Pay for higher-value care. (ii) Flexibility: provide the flexibility needed for practitioners to deliver high-quality health care. (iii) Quality and Cost: are anticipated to improve health care quality at no additional cost, maintain health care quality while decreasing cost, or both improve health care quality and decrease cost. (iv) Payment methodology: pay APM Entities with a payment methodology designed to achieve the goals of the PFPM Criteria. Addresses in detail through this methodology how Medicare, and other payers if applicable, pay APM Entities, how the payment methodology differs from current payment methodologies, and why the PFPM cannot be tested under current payment methodologies. (v) Scope: aim to broaden or expand the CMS APM portfolio by addressing an issue in payment policy in a new way or including APM Entities whose opportunities to participate in APMs have been limited. (vi) Ability to be evaluated: have evaluable goals for quality of care, cost, and any other goals of the PFPM. (2) Care delivery improvements: Promote better care coordination, protect patient safety, and encourage patient engagement. (ii) Patient Choice: encourage greater attention to the health of the population served while also supporting the unique needs and preferences of individual patients. (iii) Patient Safety: aim to maintain or improve standards of patient safety. (3) Information Enhancements: Improving the availability of information to guide decision-making. (ii) [Reserved] Subpart P—Home Infusion Therapy Services Payment Source: 84 FR 60643, Nov. 8, 2019, unless otherwise noted. Conditions for Payment § 414.1500 Basis, purpose, and scope. This subpart implements section 1861(iii) of the Act with respect to the requirements that must be met for Medicare payment to be made for home infusion services furnished to eligible beneficiaries. § 414.1505 Requirement for payment. In order for home infusion therapy services to qualify for payment under the Medicare program the services must be furnished to an eligible beneficiary by, or under arrangements with, a qualified home infusion therapy supplier that meets the following requirements: (a) The health and safety standards for qualified home infusion therapy suppliers at § 486.520(a) through (c) of this chapter. (b) All requirements set forth in §§ 414.1510 through 414.1550. (c) The home infusion therapy supplier must be enrolled in Medicare consistent with the provisions of § 424.68 and part 424, subpart P of this chapter. [84 FR 60643, Nov. 8, 2019, as amended at 85 FR 70355, Nov. 4, 2020] § 414.1510 Beneficiary qualifications for coverage of services. To qualify for Medicare coverage of home infusion therapy services, a beneficiary must meet each of the following requirements: (a) Under the care of an applicable provider. (b) Under a physician plan of care. § 414.1515 Plan of care requirements. (a) Contents. (b) Physician's orders. (c) Plan of care signature requirements. Payment System § 414.1550 Basis of payment. (a) General rule. (1) The actual charge for the item or service. (2) The fee schedule amount for the item or service, as determined in accordance with the provisions of this section. (b) Unit of single payment. (c) Initial establishment of the payment amounts. (1) Category 1. (ii) Payment equals 1 unit of 96365 plus 4 units of 96366. (2) Category 2. (ii) Payment equals 1 unit of 96369 plus 4 units of 96370. (3) Category 3. (ii) Payment equals 1 unit of 96413 plus 4 units of 96415. (4) Initial visit. (ii) The first visit payment amount is subject to the following requirements if a patient has previously received home infusion therapy services: (A) The previous home infusion therapy services claim must include a patient status code to indicate a discharge. (B) If a patient has a previous claim for HIT services, the first visit home infusion therapy services claim subsequent to the previous claim must show a gap of more than 60 days between the last home infusion therapy services claim and must indicate a discharge in the previous period before a HIT supplier may submit a home infusion therapy services claim for the first visit payment amount. (d) Required payment adjustments. (1) An adjustment for a geographic wage index and other costs that may vary by region, using an appropriate wage index based on the site of service of the beneficiary. (2) Beginning in 2022, an annual increase in the single payment amounts from the prior year by the percentage increase in the Consumer Price Index (CPI) for all urban consumers (United States city average) for the 12-month period ending with June of the preceding year. (3)(i) An annual reduction in the percentage increase described in paragraph (d)(2) of this section by the productivity adjustment described in section 1886(b)(3)(B)(xi)(II) of the Act. (ii) The application of the paragraph (c)(3)(i) of this section may result in the both of the following: (A) A percentage being less than zero for a year. (B) Payment being less than the payment rates for the preceding year. (e) Medical review. (1) Beneficiary eligibility. (2) Plan of care requirements. (3) Medical necessity determinations. Subpart Q—Payment for Lymphedema Compression Treatment Items Source: 88 FR 77876, Nov. 13, 2023, unless otherwise noted. § 414.1600 Purpose and definitions. (a) Purpose. (b) Definitions. Benefit category determination Lymphedema compression treatment item § 414.1650 Payment basis for lymphedema compression treatment items. (a) General payment rule. (1) The actual charge for the item; or (2) The payment amount for the item, as determined in accordance with paragraph (b) of this section. (b) Payment amounts. (1) If payment amounts are available from Medicaid state plans, then 120 percent of the average of the Medicaid payment amounts. (2) If payment amounts are not available from Medicaid state plans, then 100 percent of the average of average internet retail prices and payment amounts from TRICARE (Department of Defense). (3) If payment amounts are not available from Medicaid state plans or TRICARE, then 100 percent of average internet retail prices. (c) Updates to payment amounts. § 414.1660 Continuity of pricing when HCPCS codes are divided or combined. (a) General rule. (b) Mapping of payment amounts. (2) If the codes for several different items are combined into a single code, then the payment amounts for the new code are established using the average (arithmetic mean), weighted by allowed services, of the payment amounts for the formerly separate codes. § 414.1670 Procedures for making benefit category determinations and payment determinations for new lymphedema compression treatment items. The procedures for determining whether new items and services addressed in a request for a HCPCS Level II code(s) or by other means meet the definition of items and services paid for in accordance with this subpart are as follows: (a) At the start of a HCPCS coding cycle, CMS performs an analysis to determine if the item is statutorily excluded from coverage under Medicare under section 1862 of the Act. (1) If not excluded by statute, then CMS determines whether the item is a lymphedema compression treatment item as defined under section 1861(mmm) of the Act. (2) If excluded by statute, the analysis is concluded. (b) If a preliminary determination is made that the item is a lymphedema compression treatment item, CMS makes a preliminary payment determination for the item or service. (c) CMS posts preliminary benefit category determinations and payment determinations on CMS.gov (d) After consideration of public consultation provided at a public meeting on preliminary benefit category determinations and payment determinations for items, CMS establishes the benefit category determinations and payment determinations for items through program instructions. § 414.1680 Frequency limitations. (a) General rule. (b) Initial furnishing of lymphedema compression treatment items. (1) Three units of daytime gradient compression garments or wraps with adjustable straps per affected extremity or part of the body. (2) Two garments for nighttime use per affected extremity or part of the body. (c) Replacements of lymphedema compression treatment items. (1) Payment for the replacement of gradient compression garments or wraps with adjustable straps per each affected extremity or part of the body can be made once every 6 months. (2) Payment for the replacement of nighttime garments per each affected extremity or part of the body can be made once every 2 years. (d) Replacements of lymphedema compression bandaging systems or supplies. § 414.1690 Application of competitive bidding information. The payment amounts for lymphedema compression treatment items under § 414.1650(b) may be adjusted using information on the payment determined as part of implementation of the programs under subpart F using the methodologies set forth at § 414.210(g). Subpart R—Home Intravenous Immunoglobulin (IVIG) Items and Services Payment Source: 88 FR 77877, Nov. 13, 2023, unless otherwise noted. § 414.1700 Basis of payment. (a) General rule. (1) The actual charge for the item or service. (2) The fee schedule amount for the items and services, as determined in accordance with the provisions of this section. (b) Per visit amount. (c) Initial establishment of the payment amount. (d) Annual payment adjustment. (1) Beginning in 2025, an annual increase in the per-visit payment amount from the prior year by the home health update percentage increase for the current calendar year. (2) [Reserved]

Related documents

• 50 CFR Part 600 — Magnuson-Stevens Act Provisions#512148
• 50 CFR Part 622 — Fisheries of the Caribbean, Gulf of America, and South Atlantic#512149
• 50 CFR Part 635 — Atlantic Highly Migratory Species#512150
• 50 CFR Part 648 — Fisheries of the Northeastern United States#512151
• 50 CFR Part 660 — Fisheries off West Coast States#512152