Health Information Management

CMS proposal would eliminate E/M levels

APCs Insider, July 19, 2013

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By Michelle A. Leppert, CPC

You probably already know that CMS released the 2014 OPPS Proposed Rule July 8. The proposed rule came in at a (relatively) light 718 pages, but contained three significant proposed changes. Over the next three weeks, I’m going to highlight those changes, starting with CMS’ proposal to collapse E/M levels into three G-codes.

Currently, hospital coders choose an E/M visit level based on the facility’s visit level criteria, the setting where the visit occurred, and whether the patient is new or established.

Because CMS did not create national E/M guidelines, hospitals had to create their own. Hopefully, you put some thought and effort into creating your criteria and factored in your costs.

CMS wants to do away with those visit levels and instead have facilities report three G-codes:

  • One for office visits
  • One for Type A ED visits
  • One for Type B ED visits

That would certainly simplify the facility coding. Coders would look for the site of service and report the appropriate G-code.

Keep in mind, however, that this proposal does not apply to professional services or to payers other than CMS. Suddenly, it’s not so simple. You still need visit level criteria for other payers. If you report the professional services, as some critical access hospitals do, you need criteria for those services as well.

Reimbursement is always a concern for providers and this proposal could end up costing a facility a significant amount of money depending on what CMS uses to set the payment rate.

Let’s say CMS sets the reimbursement rate based on an average Level 3 visit. Theoretically, your visits should be distributed on some sort of bell curve, meaning most of your visits fall in the Level 3 range. If you have a lot of Level 1 and 2 visits, you could be undercoding. If most of your visits are Level 4 or 5, you may need to review your criteria–unless you’re a trauma center.

If your facility performs a lot of Level 1 and 2 visits, you’re in good shape. You might even see increased reimbursement.

However, if your facility performs mostly Level 4 and 5 visits, your reimbursement could drop significantly.

We can’t predict what CMS will use as a reimbursement rate so we can’t perform any impact analysis. We don’t even know if CMS will go through with this plan. It could simply be a test balloon to solicit comments.

If you have thoughts about the proposal, send them to CMS with some comments or better yet, data. CMS loves data. Tell them why you agree or disagree with this plan. If you think you have a better idea, send that in as well.

The proposed rule is like an election—if you don’t comment, don’t complain if CMS finalizes a proposal you don’t like.

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