Docs More Supportive of E/M Payment Changes, But Concerns Remain

November 05, 2018 - Healthcare industry groups remain concerned about collapsing evaluation and management (E/M) payment rates for most office visits, but the groups are generally more supportive of the final E/M payment changes.

In the recently finalized 2019 Medicare Physician Fee Schedule (PFS) rule, CMS announced that it will consolidate payment rates for E/M office/outpatient visits for Levels 2 through 4 starting in 2021. The federal agency would keep a separate payment rate for Level 5 E/M office/outpatient visits to account for the needs of medically complex patients.

By 2021, physicians can also use add-on codes when billing for E/M office visits Levels 2 through 4 to account for the specific needs and care of patients.

The federal agency finalized the E/M payment changes after industry-wide pushback. Under the proposed 2019 Medicare PFS rule, CMS wanted to collapse the payment rates for all upper levels of E/M office/outpatient visits. And physicians would start using the single/blended payment rate in 2019.

Industry leaders opposed the proposed consolidation of payment rates for Levels 2 through 5 of E/M office visits, arguing that a single rate for the levels would penalize physicians who treat the sickest patients.

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But the stakeholders are changing their tune in light of the finalized changes to E/M payment rates.

For example, the American Hospital Association’s Senior Vice President of Public Policy Analysis and Development Ashley Thompson said, “We also appreciate that the agency responded to our concerns and mitigated its proposal to consolidate evaluation and management codes for providers.”

“CMS will now retain three levels of codes and delay implementation until 2021, which will allow us to work with the agency to ensure that physicians who treat a disproportionate number of higher-acuity patients are not financially penalized,” she added.

The hospital association had urged CMS in September 2018 to not finalize the proposal to collapse the payment rates for E/M office visits Levels 2 through 5. Reducing payments for all levels of E/M visits would devalue provider time and increase the pressure on physicians to maximize the number of patients they see each day, the association argued.

AMGA also recently commended CMS for modifying its final E/M payment policies after the industry group criticized the federal agency for its proposals.

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“AMGA today stated that it is encouraged that Centers for Medicare & Medicaid Services (CMS) opted not to finalize a proposed change to Evaluation and Management (E/M) office visit codes in the new physician fee schedule rule,” the group said in an official statement.

The industry group had opposed the proposed changes to E/M payment rates, explaining that the proposal would disrupt physician workflows and referral patterns.

But the final policy keeping the E/M Level 5 payment rate will help to resolve the issues identified by AMGA, the group’s President and CEO explained.

“AMGA members were very concerned that CMS was moving too aggressively in its plan to streamline the payment and coding for E/M office visits, particularly those providers who treat a large number of complex patients,” said Jerry Penso, MD, MBA. “Maintaining the code for the most complex patient visits somewhat alleviates that concern.”

The maintenance of a separate payment rate for Level 5 E/M office visits was also a welcome change for the Association of American Medical Colleges (AAMC).

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“While we continue to review the rule, we appreciate that CMS acknowledges our concerns about the importance of appropriate payments for complex patients,” the association wrote. “Physicians who are associated with medical schools and teaching hospitals treat many patients with complex needs, and we look forward to working with CMS to ensure that payments accurately reflect the resources and effort needed to care for these patients. We also are happy that CMS took our recommendation and did not finalize proposed changes to the multiple procedure payment reduction policy.”

While the delay and revision of the collapsed E/M payment rates was a positive for the Medical Group Management Association (MGMA), the changes in the final rule may not be enough for the industry group to fully support the rule.

“[T]here's more work to be done,” Anders Gilberg, MGMA’s Senior Vice President of Government Affairs, said in an emailed statement.

“Blending payments rates in 2021 won't necessarily reduce burden, especially with CMS’s newly required add-on codes,” he continued. “MGMA will continue to examine the rule, leverage feedback from members, and work with CMS to create meaningful burden reduction for physician practices across the country.”

Industry groups are more supportive of the E/M payment changes included in the final 2019 Medicare PFS rule. However, the groups still have two years to work with CMS to refine the new payment policy.