Health Information Management

A consultation code conundrum: Many providers face difficult transition in 2010

JustCoding News: Outpatient, December 2, 2009

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by Holly Cassano, CPC

When CMS included the surprising suggestion to eliminate consults in the Medicare physician fee schedule proposed rule for 2010, many specialty organizations, along with the AMA contested the proposed change. However, despite the overwhelming opposition from the medical community to this elimination, CMS finalized the change in the Medicare physician fee schedule final rule for 2010.

Medicare will consider the consult codes (99241–99255) invalid for payment, effective January 1. Although CPT® Professional Edition 2010 still maintains the codes, CMS will take the payments for consultation codes 99241–99255 and redistribute them to office visits (99201–99215), hospital care (99221–99233), and nursing home (99304–99310) codes.

If a payer follows Medicare’s lead and decides to not recognize the consult codes, for outpatient consultation services you would instead report an office visit code (99201–99215, Office or other outpatient service). Note, however, that providers will need to refer to other evaluation and management codes (e.g., initial hospital care codes, initial nursing facility codes) when reporting inpatient consultation services or services performed in a nursing facility. Provider offices will have to keep a sharp eye on which commercial payers allow consultation codes.

Historical errors in reporting

CMS took this step largely in part to the Office of Inspector General’s (OIG) findings in 2006 that indicated a high error rate in the reporting of consultation codes, which led to $1.1 billion in incorrect payments. The 2006 OIG audit disclosed that out of the 400 samples the OIG reviewed, 45% were miscoded, 20% were not consults, and only 5% were level five consults.

These reporting inaccuracies are often a product of confusion over what qualifies as a consult. Many physicians argue that when another provider sends a patient to them, this is automatically a consultation. Unfortunately, this just simply is not so. Often, these encounters ultimately qualify as transfers of care, however providers report them as consults because they genuinely believe that is the kind of service they provided.

“We couldn’t even all agree on some scenarios, they don’t have the same criteria,” said William J. Mangold, Jr., MD, JD, medical director for Noridian Administrative Services of Arizona, Montana, Utah and Wyoming, on day two of the opening session of the 2010 CPT and Resource-Based Relative Value Scale AMA Annual Symposium in Chicago held November 11–13.

Revisions in CPT® Professional Edition 2010

The AMA added the following to the definition of consultations in the 2010 CPT Manual:

For a specific condition or problem or to determine whether to accept responsibility for ongoing management of the patient's entire care or for the care of a specific condition or problem.

In the section for office or other outpatient consultations, the AMA also included the following:

Services that constitute a transfer of care (i.e., are provided for the management of the patient's entire care or for the care of a specific condition or problem) are reported with the appropriate new or established patient codes . . .

Sounds familiar doesn’t it? CMS uses this same language in the Medicare Claims Processing Manual to explain what constitutes a transfer of care. This guidance along with language in the 2009 Medicare physician fee schedule proposed rule reflect that a transfer of care is not a consult. In that rule, CMS commented that it perceived that the AMA did not help the physician community to understand the concept of transfer of care, which CMS again pointed out in its proposed and final rules this year.

The other significant AMA revision related to consults is that it states that “either the consulting or requesting physician or appropriate source” should document the request for consult in the patient's medical record. That is a more liberal allowance for consults than that from Medicare, which says that both the requesting and consulting clinicians should document the request.

A look at other payer policies

Other payers that do not base their fee schedules on Medicare may not follow Medicare’s lead. Essentially this varying policy for consultation codes translates into a deconstruction in the uniformity of coding and billing for these services.

For example, a social worker requests a pediatrician’s opinion for a child with ongoing behavior issues. The physician evaluates the child and reports the findings to the child’s parent. Under the 2010 CPT guidelines, the pediatrician could report a consult code because the encounter involves a request for opinion, rendering of an exam, and a report of findings. However, a commercial payer may elect to follow Medicare and no longer recognize the consult codes. In that case, the pediatrician would report the appropriate office visit code (99201–99215, Office or other outpatient service).

Because the history, examination, and medical decision-making components are not parallel for the different code levels for office visits and consults, the code level would change depending on the reporting method. This could become quite complicated for both providers and auditors, who will have to determine which level of service the documentation supports.

The bottom line

The medical community could really feel the sting of this monumental decision. The financial impact of this change will significantly affect the bottom line for many practices, and providers will have to ensure that they are documenting the necessary details to obtain appropriate reimbursement. To learn more about the financial implications, access this table from the American Academy of Neurology, which outlines the effects on both the outpatient office consults and inpatient consult relative value units (RVU).

A bumpy road is ahead for providers, and it may be prudent for many to take a wait and see approach with the commercial carriers to see if they will implement any changes based on CMS’s decision.

I would encourage providers to implement a tracking system or spreadsheet to gather information from commercial payers regarding their policies for reporting consultations in 2010. Stay on top of any denials and reimbursements related to consultations for the first two quarters of 2010, and resolve any problems in a timely fashion to lessen the long-term financial effects.

Editor’s note: Holly Cassano, CPC, is a Medical Coder and Educator for the Emergency Department at the Cleveland Clinic Florida. E-mail her at

Interested in learning more about consultation code changes for Medicare claims? Joan Lowes, JD, and Joe Rivet, CCS-P, CPC, CEMC, CICA, will discuss Medicare’s new policy for consultation codes during a December 21 HCPro audio conference, “Medicare Consultation Code Changes in 2010: Ensure Accurate Coding and Billing for Appropriate Payment.” To learn more or to purchase, go to the Healthcare Marketplace.

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