Prepare Now for an E&M Reimbursement Revolution

Evaluation and Management

Ground-breaking changes to Evaluation and Management (E&M) documentation and payment are on the horizon, and the impact will vary widely depending on your specialty. Can you look forward to a pay bump—or a reimbursement reduction? Read on to find out.

The scoop: CMS recently released a proposed rule to update payment policies, payment rates, and quality provisions under the Medicare Physician Fee Schedule (PFS) for 2019, according to coding and billing guru Lynn M. Anderanin. Embedded among the plethora of revisions is a significant proposed modification to E&M coding, documentation, and reimbursement, Anderanin explains in her ProfEdOnDemand audio conference, “CMS Proposed Changes to E&M for 2019 – What You Need to Know.” If finalized, the changes would take effect on Jan. 1, 2019.

E&M CMS Changes: 4 New Documentation Choices?

Essentially, CMS wants to combine E&M service Level 2 through Level 5 into a single payment rate, according to the American Academy of Family Physicians (AAFP).

How it would work: Medicare would pay for new patient E&M services at the midpoint between Level 3 and Level 4 (99203 and 99204) and established patient visits at just under the midpoint between Level 3 and Level 4 (99213 and 99214).

CMS also proposes allowing physicians to choose the E&M service level based on time or by using medical decision-making alone, regardless of the level of history or physical exam performed, AAFP explained. This time-based option would relax existing requirements and eliminate the mandate that more than half the visit is devoted to counseling or care coordination.

Bottom line: According to Meridian Medical Management, under the proposed E&M documentation guidelines, CMS would allow you to choose one of four ways to document the E&M visit level:

  1. Medical decision-making;
  2. Time duration of the visit (regardless of whether counseling or care coordination dominates the visit);
  3. Continue using the 1995 Documentation Guidelines (DGs); or
  4. Continue using the 1997 DGs.

The numbers: Medicare would reimburse for Level 2 through Level 5 office and outpatient E&M visits for new patients at a fixed rate of $135 and for established patients at a fixed rate of $93. Level 1 E&M visit reimbursement would be $44 for new patients and $24 for established patients.

Beware of Using Modifier 25 Unnecessarily

In combining the E&M levels into a single fixed rate, CMS also proposes to no longer require physicians to re-record chief complaint and history of present illness when ancillary staff have already documented this information.

Not done yet: The proposed rule also contained a smattering of other potential changes that would impact your E&M services. According to Meridian Medical Management, these proposed revisions include:

  • Reduce E&M services by 50 percent for visits billed with modifier 25 (procedure done on the same day);
  • Allow certain specialties to bill add-on codes for E&M Levels 2 through 5 to adequately reflect resources utilized;
  • Eliminate the requirement to justify the medical necessity of a home visit in lieu of an office visit; and
  • Eliminate the potentially duplicative requirements for medical record notations when teaching physicians furnish E&M visits.

Backlash: Of course, not everyone is happy with the proposed E&M payment and documentation changes.

The fixed-rate strategy would provide a payment increase for some specialties, while decreasing it for others, Policy & Medicine reported. Physicians who see more complex patients (Level 4 and 5 visits) would suffer a far more negative impact than those who typically have more Level 1, 2, or 3 visits.

Examples: Based on Table 22 of the proposed rule, CMS projects that gynecologists and obstetricians would experience the biggest pay increase for E&M services (up 4 percent), while podiatrists and dermatologists would suffer the biggest pay decrease (down 4 percent). Some specialties, such as cardiology and family practice, would see a minimal change.

Brace for Substantial Changes Ahead

What to expect: If finalized, these E&M CMS changes would apply only to office visit codes for Medicare, AAFP stated. The existing 1995/1997 E&M guidelines will continue to apply for other services and commercial payers. But CMS has noted that it will expand the policy to other E&M code categories in the coming years.

Key takeaway: Whether or not the proposed E&M revisions to payment rules and documentation guidelines could hurt your reimbursement, you must understand what the changes are so you are prepared to comply with them, Anderanin stresses. Stay up-to-date on the proposed Medicare PFS changes so you can be ready come Jan. 1, 2019.

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