Health Information Management

Questions remain as CMS announces no-pay policy for consultation codes in 2010

JustCoding News: Outpatient, December 16, 2009

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Editor's note: After the deadline for publishing this article, CMS issued Transmittal 1875 in the Medicare Claims Processing Manual with additional guidance on its policy change for consultation codes.

Although CMS stated that its decision to no longer pay for consultation codes in 2010 is meant to alleviate confusion that has surrounded the reporting of these codes for years, many providers argue that this change simply introduces different complications.

In the 2010 Medicare physician fee schedule (MPFS) final rule, CMS announced that it was finalizing its proposal to stop paying for consultation codes, with the exception of G codes for telehealth consultations.

“CMS surprised me. I never would have guessed that they would have done this,” says Peggy S. Blue, MPH, CPC, CCS-P, regulatory specialist at HCPro, Inc., in Marblehead, MA, who expected CMS to wait at least another year before going forward with the proposed change. “It is a good solution. I do think it will work, but I think there will be initial confusion.”

In the final rule, CMS gave a historical account of many things they have tried to do over the years to get clinicians, as well as its own contractors, to understand Medicare’s guidelines for consults. CMS acknowledged that this change will also require additional education.

“CMS said it recognized that education would have to take place, but they didn’t see the hurdles to educating the physician community to be so significant as to delay implementation,” Blue says.

Because this change is designed to be budget neutral, CMS will increase the relative value units for other evaluation and management (E/M) codes (e.g., new and established office visits, initial hospital and initial nursing facility visits).

Regardless of the financial affect on providers, there are still several questions to resolve before the new payment policy for consultation codes takes effect.

Will CMS allow shared visits?
Is it CMS’ intent to allow physicians to perform consultations as shared visits (i.e., with a physician assistant [PA], nurse practitioner [NP]) when providers begin reporting consultations using initial hospital care codes (99221–99223), for which the criteria allows shared visits?

“That’s a really important question because CMS has always said that physicians are not supposed to have shared visits for consultations, but this is perfectly legitimate for hospital codes,” Blue says.

Prior to this change, only admitting physicians could report the initial hospital care codes, said Elin Baklid-Kunz, MBA, CPC, CCS, director of physician services at Halifax Health in Daytona Beach, FL.

“This opens up a can of worms because physicians have been dinged in the past by doing consultations as shared visits,” Baklid-Kunz says. “There needs to be guidance about whether those codes do allow shared visits.”

If CMS were to allow shared visits, this would help physicians greatly because that would mean that a PA could perform 95% of the visit, and the physician could then perform a face-to-face visit and document the part of the visit they performed, often the medical decision-making, Baklid-Kunz says.

However, physicians need to check with the hospital bylaws. Many do not permit PAs and NPs to see new patients, including consultations. The thought behind this is that when a physician requests the specialist’s opinion, the physician should perform the visit—not a PA or NP. And hospital bylaws are not easy to change.

Will your documentation support the codes?
One of the primary problems that auditors find when they review records is that physician documentation doesn’t meet the level billed because of the history component, Blue says.

The lowest level initial hospital care code (99221) requires a detailed history and a detailed exam. Previous to this change, coders were able to bill consultation code 99251, which requires only a problem-focused history and problem-focused exam.

“Now that [the new coding policy] requires a detailed history, documentation might not satisfy the minimum requirements for reporting this code,” Blue says. “The history is what the history is. You can’t query as you would for clarification about the diagnosis or the procedure.”

Inpatient consultation codes have five levels, but there are only three levels of initial hospital care codes. In addition, the face-to-face times in the initial hospital care codes (i.e., 30, 50, and 70 minutes) compared to the face-to-face times associated with the inpatient consult codes (i.e., 15, 30, 40, 60, and 80 minutes) don’t really match up.

So it is somewhat unclear what coders should report when the physician performs only a problem-focused history and problem-focused exam. “How do we crosswalk that to code 99221?” Baklid-Kunz says. “This doesn’t meet the criteria for reporting code 99221.”

Will CMS distinguish between consultations and referrals?
When the referring physician’s intent is to get the consulting physician’s opinion, then the consulting physician should report initial hospital care codes (99221–99223), Baklid-Kunz says.

However, when there is a transfer of care from the admitting physician to the cardiologist to manage the patient’s congestive heart failure during the hospital stay, for example, this is a transfer of care rather than a consult, Blue says. So should the cardiologist still report the initial hospital care codes when there’s a transfer of care? Or instead, should the cardiologist report a subsequent hospital care code?

Even though CMS provided some guidance in the final rule, the verbiage still requires more clarity, Blue says. Note the following language from the 2010 MPFS final rule:

Outside the context of telehealth services, physicians will bill an initial hospital care or initial nursing facility care code for their first visit during a patient’s admission to the hospital or nursing facility in lieu of the consultation codes these physicians may have previously reported. Because of an existing CPT coding rule and current Medicare payment policy regarding the admitting physician, we will create a modifier to identify the admitting physician of record for hospital inpatient and nursing facility admissions. For operational purposes, this modifier will distinguish the admitting physician of record who oversees the patient’s care from other physicians who may be furnishing specialty care. The admitting physician of record will be required to append the specific modifier to the initial hospital care or initial nursing facility care code which will identify him or her as the admitting physician of record who is overseeing the patient’s care.

The wording seems to indicate that both the consulting physician and the admitting physician should report the initial hospital care codes.

“If that’s true, that means when a transfer of care has occurred rather than a consult, the practitioner should report the subsequent care codes instead of the initial care codes, which means that we will still have to worry about distinguishing between consultations versus transfers of care,” Blue says.

Now that more than one physician will report initial hospital care codes, CMS had announced that it would create a modifier that only the admitting physician reports. CMS updated the 2010 HCPCS modifier file on November 5, and this update included new modifier –AI. Although CMS has not released any official guidance regarding the use of this modifier, it seems appropriate that the principal physician of record (i.e., admitting physician) should report modifier –AI, Baklid-Kunz says.

Now consider this additional language from the final rule:

We believe that a good deal of this confusion and disagreement arises from the use of terms such as referral, transfer, and consultation which are used sometimes interchangeably and sometimes inconsistently, by physicians in clinical settings. The divergent interpretations and uses of these terms have served to confuse the meaning of a consultation service, as some label a transfer as a referral while others label a consultation as a referral. Even with the new definition of “transfer of care,” we foresee many clinical situations in which two physicians may not agree as to whether the referral was for consultation or transfer of care, and it may be difficult to resolve the issue based upon the conflicting interpretations reflected in the two physicians’ medical records.

“Now it sounds like they want to do away with the whole issue of consult vs. transfer of care, but if they have consulting physicians reporting initial care codes and transfer cases reporting subsequent care codes, then they have not achieved this goal,” Blue says. “I think CMS still has some clarification to do.”

How will you sort out payer problems?
The confusion only multiplies when you begin to add other primary and secondary payers into the equation.

“Operationally, it will be a nightmare if private payers decide to keep the consultation codes,” Baklid-Kunz says. “Physicians might not know at the time who the payer is.”

Therefore documentation must meet multiple sets of criteria and the billing process may be different depending on who the payer is and whether Medicare is a primary or secondary payer.

“Physicians need to keep up with that documentation even when it’s not relevant for CMS,” Baklid-Kunz says.

When Medicare is the primary payer, CMS advises physicians to consult with the secondary payers for advice on how to bill in order to receive secondary payment, Blue says.

“The prospect is even more dismal when Medicare is the secondary payer,” she says. When physicians want secondary payment from Medicare, then they would have to submit the claim to the commercial payer with the appropriate E/M visit code. However this presents quite the conundrum when the commercial payer still requires providers to submit the appropriate consultation code instead.

When physicians choose to bill the consult code to receive payment from the primary payer, they can be sure that Medicare will deny the secondary payment.

Editor’s note: E-mail Baklid-Kunz 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 CMS’ new no-pay 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 Web site.

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