On November 1, the Centers for Medicare & Medicaid Services (CMS) finalized its proposal to extend virtual direct supervision—i.e., the ability to provide direct supervision through real-time, audio-visual technology (rather than in-person presence)—through December 31, 2025, and to permanently allow virtual direction supervision for a subset of “incident to” services.
Part of the CY 2025 Medicare Physician Fee Schedule (MPFS) final rule and CY 2025 Medicare Hospital Outpatient Prospective Payment System and Ambulatory Surgical Center Payment System (OPPS) final rule, these changes revise 42 C.F.R. §§ 410.26, 410.27, 410.28, 410.32 to allow practitioners to continue using virtual direct supervision on a temporary basis through December 31, 2025—and on a permanent basis in limited circumstances thereafter—while CMS continues to consider the future of virtual direct supervision more broadly, a task it frames as balancing patient safety, quality, and program integrity concerns with the interest of supporting expanded access to care and preserving workforce capacity for medical professionals.
Temporary Extension and Permanent Changes
In the MPFS and OPPS final rules, CMS extends the virtual direct supervision flexibility under 42 C.F.R. §§ 410.32(b)(3)(ii), 410.27(a)(1)(iv)(B)(1), and 410.28(e)(2)(iii) for another year, through December 31, 2025, permitting the presence and “immediate availability” of the supervising practitioner through real-time audio and visual interactive telecommunications.
For the first time, the MPFS final rule also permanently extends virtual direct supervision for the following subset of incident to services under 42 C.F.R. § 410.26 furnished after December 31, 2025, that are almost always performed entirely by auxiliary personnel:
- Services furnished incident to a physician or other practitioner’s service when provided by auxiliary personnel employed by the billing practitioner and working under their direct supervision and for which the underlying HCPCS code has been assigned a PC/TC indicator of “5.”
- Services described by CPT code 99211 (office or other outpatient visit for the evaluation and management of an established patient that may not require the presence of a physician or other qualified healthcare professional).
Interestingly, for the first subset of services above, the permanent extension for services furnished after December 31, 2025, is drafted to apply only to auxiliary personnel employed by the billing practitioner. This begs the question as to whether CMS intends to exclude from virtual direct supervision flexibilities services performed by auxiliary personnel contracted by the billing practitioner or an entity that employs or contracts with the billing practitioner or if use of the term “employed” was used more generically, given an employment requirement is seemingly at odds with the definition of “auxiliary personnel” within the context of incident to billing in 42 CFR 410.26(a)(1), which encompasses employees, leased employees, and independent contractors. Additionally, the definition of “auxiliary personnel” also extends beyond individuals contracted with the billing practitioner to individuals who are employed or contracted with the same entity that employs or contracts with the physician (or other practitioner). In that case, upon expiration of the temporary extension on December 31, 2025, such services furnished by auxiliary personnel contracted by the billing practitioner or employed by or contracted with an entity contracted with the billing practitioner would appear to revert back to the in-person direct supervision requirements at § 410.32(b)(3)(ii). The commentary on the final rule does not address this distinction.
CMS reasons that these specific services present less of a patient safety concern than services for which there may be a need for immediate intervention of the supervising practitioner. Specifically, CMS believes these services are low risk by their nature, do not often demand in-person supervision, and are typically furnished entirely by the supervised personnel. CMS concludes that allowing virtual direct supervision of these services would balance patient safety concerns with the interest of supporting access and preserving workforce capacity.
The Future of Virtual Direct Supervision
The future of virtual direct supervision is bright given CMS’ decision to again extend virtual direct supervision for another year and, more significantly, to make it permanent for certain services. In addition, CMS has signaled its continued willingness to consider allowing virtual direct supervision of other services in the future.
In the MPFS final rule, CMS reiterates the possibility of expanding permanent virtual direct supervision for additional services in the future. CMS finalized as proposed an incremental approach through which it will consider allowing virtual direct supervision for services that it determines are “inherently lower risk,” meaning those that ordinarily do not require the physical presence of the billing practitioner, do not require direction by the supervising practitioner to the same degree as other services furnished under in-person direct supervision, and are not typically performed directly by the supervising practitioner. Services that CMS will consider for permanent virtual direct supervision include diagnostic tests, behavioral health, dermatology, therapy, registered dietician nutritionists, cardiac rehabilitation, and pulmonary rehabilitation services.
Similarly, the OPPS final rule suggests that CMS will continue to evaluate the safety, quality of care, and other considerations while examining the possibility of permanent virtual direct supervision for cardiac rehabilitation, intensive cardiac rehabilitation, pulmonary rehabilitation, and diagnostic services furnished to hospital outpatients in the future. CMS will also consider the possibility of furnishing virtual cardiac rehabilitation and intensive cardiac rehabilitation to outpatients in their homes in future rulemaking.
Many stakeholders supported extending the temporary virtual direct supervision for another year, although most requested that the flexibility be made permanent. Some commenters expressed concerns related to patient safety, barriers to billing, and the increasing amount of physician “incident to” billing for services provided by physician assistants and nurse practitioners. As CMS continues to weigh the favorable aspects of virtual direct supervision against the concerns of safety, quality, and program integrity concerns, it will be important for stakeholders to marshal evidence in favor of their positions.
Moreover, healthcare practices and providers that opt to leverage virtual direct supervision should be careful to ensure that they have appropriate policies and infrastructure to support and document that the supervision was immediately available by appropriate means and was provided as required by Medicare.
For more information on virtual direct supervision, please contact the authors.