Important 2025 Billing Updates All Palliative Care Clinicians Should Know

This blog includes information we know as of December 11, 2024. If anything changes, we will update this post.

On November 1, 2024, the Centers for Medicare & Medicaid Services (CMS) announced the final rule for the 2025 Medicare Physician Fee Schedule (PFS), which will take effect on January 1, 2025. The goal of these changes is to create a more equitable, accessible, and high-quality health care system.

This post explains what the 2025 updates mean for the palliative care field and your everyday practice—so you’re informed and can bill for the work you do. If you need a refresher about how payment is calculated within the fee-for-service model, last year’s blog does a deep dive into the framework.

While there aren’t significant changes for 2025, some decisions were made that may impact your bottom line. Below, we’ve broken down these updates in the order of how much we think they will impact billing for palliative care and related services. For a more in-depth conversation about the 2025 PFS, join us for a webinar in January 2025.

For 2025, the Medicare PFS conversion factor will decrease by 2.83%, from $33.29 to $32.35. This reduction will affect reimbursement levels for clinicians across specialties, including those delivering palliative and chronic care.

The reduced conversion factor is necessary because, by law, Medicare must remain cost-neutral to the federal government, and any increases elsewhere in the PFS require offsets. However, legislation has been proposed to eliminate this conversion factor reduction, and CAPC will update our guidance based on the final federal budget.

COVID-19 telehealth flexibilities, previously extended through legislation, are set to expire December 31, 2024. Without congressional action, CMS will return to pre-pandemic telehealth policies, which do not cover telehealth delivered to a patient’s home and exclude many geographic areas. There are several bills proposed to extend the current telehealth flexibilities for another two years, and CAPC will update our guidance if/when legislation is passed.

In other news about telehealth care, the U.S Drug Enforcement Administration (DEA) updated prescribing flexibilities for controlled medications for current patient relationships. This is separate from CMS policies.

Most encounters allowable via telehealth will require audio-visual technology, though audio-only communication can be billed for patients unable or unwilling to use video technology. This is particularly crucial for palliative care, where continuity of care is often required in home settings, and many needed services can be delivered telephonically.

• Direct Virtual Supervision: CMS will continue to allow a certain sub-set of services that require direct supervision to be supervised remotely with real-time audio-video, a helpful tool for clinicians in flexible patient care arrangements.
• Teaching Physician Virtual Supervision: CMS extended virtual supervision for teaching physicians during telehealth services, supporting accessibility in educational and clinical training.
• Behavioral Health Exception: Most behavioral health services can still be conducted via telehealth, underscoring CMS’s focus on mental health access.

In the 2024 Physician Fee Schedule, CMS introduced new billing codes to compensate for caregiver training. Starting in January 2025, CMS will extend the allowable training to include caregiver instruction on how to provide direct care services, such as pressure ulcer prevention, wound care, infection control, and behavior management. In addition, CMS will allow the caregiver training to be delivered virtually. This addition is particularly beneficial in palliative care, where caregivers play a vital role in patient support and management.

CMS has introduced a new series of codes that reimburse essential care services such as 24/7 patient access, care planning, and comprehensive care management. These codes support value-based care and aim to enhance continuity for patients with chronic conditions. The Advanced Primary Care Management (APCM) structure could also support palliative care clinicians who assume responsibility for both primary and palliative care. Unlike the existing care management codes, the new APCM codes do not have time-based thresholds.

APCM Code Levels:

• G0556: For patients with one chronic condition.
• G0557: For patients with two or more chronic conditions.
• G0558: For patients with multiple chronic conditions and Qualified Medicare Beneficiary status.

The APCM codes may be valued low, although CMS has noted a willingness to revisit the valuation for these services in future rulemaking. In addition, clinicians in the same practice may bill for the other care management codes—including Principal Care Management, Transitional Care Management, and Chronic Care Management—while the APCM is billed by another clinician.

The 2025 CMS PFS changes signify a shift towards person-centered care with stronger support for caregivers and mental health access. Although some telehealth flexibilities will sunset and the conversion factor will decrease, CMS’s adjustments demonstrate a commitment to shifting resources toward integrated, patient-centered health care models for both clinicians and beneficiaries. These updates represent a positive step toward an inclusive approach within Medicare, aligning with the broader goal of equitable health care in 2025.

Every year, CAPC provides palliative care teams with updated billing guidance upon the release of the PFS. Throughout the year, CAPC hosts Virtual Office Hours and webinars on best practices in billing and many other resources to help navigate the ever-changing landscape of health care billing, reimbursement, and delivery. Here are some resources that we recommend tuning into:

• Register for the upcoming webinar 2025 Billing and Coding for Palliative Care: Physician Fee Schedule Updates, presented by Christopher Jones, MD, MBA, and Phillip Rodgers, MD, FAAHPM, January 28, 2025, at 1:30 pm ET.
• Explore our Optimizing Billing Practices toolkit, which will be updated soon [BM2] to reflect the 2025 changes to the PFS.
• For a closer look at how to navigate an RVU-driven world as a palliative care leader, read our blog, Everything You Always Wanted to Know about RVUs But Were Afraid to Ask, by Lynn Spragens, MBA, and Allison Silvers, MBA.

Clinical review by Andrew Esch, MD, MBA.