Health Information Management

CMS replaces clinic E/M visit levels with single G-code

JustCoding News: Outpatient, January 8, 2014

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CMS replaces clinic E/M visit levels with single G-code
One of the most radical changes CMS proposed in the 2014 OPPS was to collapse the five levels of evaluation and management (E/M) CPT® codes and replace them with three new HCPCS G-codes, including one APC for all clinic visits, one for all Type A ED visits, and one for all Type B ED visits.
“Fortunately, CMS did not finalize what it proposed in full, as this could have had a major impact on revenue—particularly ED revenue for hospitals—given that CMS moved forward with so much packaging,” says Jugna Shah, MPH, president and founder of Nimitt Consulting.
Instead, in the 2014 OPPS Final Rule, CMS only finalized the collapsing of E/M codes for clinic visit APCs. For 2014, HCPCS code G0463 replaces CPT codes 99201-99205 (new patient visit) and 99211-99215 (established patient visit), and is assigned to APC 0634.
Impact on clinic visits
Instead of being reimbursed based on the acuity of the patients or the types of hospital/nursing services rendered, all clinic visits will now be paid at a single rate.
With a prospective payment system based on averages, CMS expects payments to average out between the low and high acuity patients that facilities treat. However, providers should examine their own volumes and see whether they will see a payment increase or decrease for their clinic visits based on the rates CMS published.
Providers should also review all status indicator V (clinic or emergency department visit) CPT/HCPCS codes to see whether other specific codes more appropriately describe the services being rendered compared to the single new HCPCS G-code. 
“This is a good time to determine whether another status indicator V code more accurately describes the service being rendered, or the service can be improved by meeting the requirement of another visit CPT/HCPCS code, such that it is more appropriate to bill than the new G0463,” says Valerie A. Rinkle, MPA, associate director with Navigant Consulting in Seattle.
For Medicare billing, facility-specific visit guidelines may not be needed, but other payers are likely to continue requiring CPT reporting, which means facilities need to maintain visit level guidelines.
In order to charge all payers consistently and to continue capturing the acuity of patients being treated, facilities should continue to charge all clinic E/M CPT codes, and report these to payers who do not recognize CMS’ single HCPCS code, says Shah. Providers should then map these codes to the G-code in the charge description master so that is what is billed for Medicare patients.
The payment rate for this new clinic visit APC is based on the mean costs of Level 1 through Level 5 new and established patient clinic visit codes from 2012 OPPS claims data and has been set at $92.53. Which levels hospitals bill most frequently, along with the other services are typically billed in addition to the visit code, will dictate the overall financial impact hospitals will see in 2014, says Shah. 
Providers can estimate the financial impact the change to E/M clinic visits will have by taking the following steps:
  • Determine clinic visit volume by each level for a department and pull all other CPT transactions on those claims
  • Create a pivot table with the volumes and percentage of codes appearing with each E/M level claim
  • Perform a department financial impact analysis using 2013 and 2014 status indicators and payment rates
Providers can also pull a sample of claims and hand price them using 2013 payment rates and rules and 2014 payment rate and rules, using the October 2013 and the January 2014 Addenda B to assign status indicators, APCs, and payment rates to each code. Then, price out each line item on the claim and total them to see the impact.
EAM levels collapsed
CMS also finalized its proposal to replace the two Composite APCs 8002 (Level I extended assessment and management [EAM] composite) and 8003 (Level II extended assessment and management composite) with a single new Composite APC.
To generate the new EAM Composite APC 8009, the following criteria must be met:
  • The single new HCPCS clinic visit code G-code, G0463, a Level 4 or 5 Type A ED visit, or a Level 5 Type B ED visit must be present along with 8 or more hours of observation time
  • The HCPCS code for a direct admission to observation and the CPT codes for critical care remain in place
  • No procedure with status indicator T (significant procedure, multiple reduction applies) can be reported on the same claim
CMS has set the 2014 payment rate for the new EAM APC at $1,199, compared to existing payment rates of $440 for APC 8002 and $798 for APC 8003.
Although this is a significantly higher payment rate, providers should note that the increase is in part due to the fact that CMS has now packaged many other services, says Shah. This means they will no longer generate separate payment, so financial impact has to be carefully analyzed.
Click here to find out more!Editor’s note: This article was originally published in Briefings on APCs. Email your questions to editor Steven Andrews at


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