Physician Advisors Guide to the 2023 Physician Fee Schedule Proposed Rule

Erica E. Remer, MD, FACEP, CCDS

The unofficial, unpublished FY 2023 Physician Fee Schedule Proposed Rule (CMS-1770-P)) was posted on July 7, 2022 (Regulations.gov). The published version is set to drop on July 29, so by the time you are reading this, you will be able to see the official Rule. Comments will be taken at https://www.regulations.gov/search?filter=CMS-1770-p until September 6, 2022.

January 1, 2021, the American Medical Association (AMA) revised the CPT Evaluation and Management (E/M) Guidelines for Office and Outpatient Visits (O/O Visits), Split/Shared Visits, and Critical Care Time billing, and CMS adopted these changes. The Proposed Rule I am reviewing here now addresses visits other than office and outpatient, referred to as “Other E/M.” The statistic is quoted that “E/M visits comprise approximately 40% of all allowed charges under the PFS” and the subset of Other E/M represents about 20%.

CMS is proposing to mostly adopt the AMA CPT E/M codes and descriptions. It can be somewhat confusing when CMS deviates from CPT’s code-view, which affects several codes and concepts presented in the Proposed Rule.

To view the specific guidelines as laid out by the AMA, go to http://www.ama-assn.org/cpt-evaluation-management. They are almost the same as the ones established for the O/O Visits. Emergency Medicine E/M level is solely MDM based; the only situation where time is used in the ED is for Critical Care billing. All other E/M will either be leveled by MDM or time-based.

Here are the high-level points from the CPT E/M guidelines:

• The definition of new and established has not changed.
• Services reported separately cannot be double dipped in Medical Decision Making (MDM). For example, if a provider bills for an echocardiogram, they may (and should) document the results in their note, but they can’t take credit for the echo in their MDM calculation for the E/M visit.
• There are no longer mandatory elements of the history or physical examination (PE).
• History and PE should be done as “medically appropriate.”
• Isn’t Social History (SH) always relevant?
• Good riddance, gratuitous Review of Systems (ROS)!
• Do the right thing for your patient – H&P may not be required for billing purposes, but they are still clinically useful and medicolegally significant.
• MDM
• There are four levels of MDM: straightforward, low, moderate, and high.
• There are three elements which are judged as to their level of complexity, and the compilation of the three elements constitutes the final E/M level. Two out of three elements must be met or exceeded to establish the level of MDM.
• Number and complexity of problem/s that are addressed during the encounter
• The problem must be addressed. Just existing in the patient’s problem list is not adequate. Was it worked up or treated? Is there monitoring? Is it contributing to the need for nursing care?
• It isn’t only about the final diagnosis – the presenting signs/symptoms may drive this element.
• If you are deferring all management to another healthcare provider, you can’t take credit for addressing the problem.
• There are pretty specific definitions of the category of problem (e.g., stable/exacerbated, chronic/acute, uncomplicated/complicated)
• Amount and/or complexity of data to be reviewed and analyzed
• You take the point when you order the test. Analyzing the result is expected and included.
• Multiple results of the same test being trended only count once (e.g., comparing serial hemoglobin or serum creatinine)
• External means from another practice or institution. Reviewing your own notes doesn’t count here. Multiple results of the same test being trended only count once (e.g., comparing serial hemoglobin or serum creatinine)
• Independent historian is giving additional story for confirmation or completeness. Language interpretation doesn’t count.
• Independent interpretation requires interpretation although it need not be a formal report. Saying, “The Xray looked good to me,” isn’t an interpretation. Instead: “The CXR doesn’t demonstrate an infiltrate or evidence of heart failure. Normal.”
• Risk of complications and/or morbidity or mortality of patient management
• Includes management options discussed, considered but not undertaken. For instance, discussion with family and decision to make patient comfort care only is considered high risk.
• Social Determinants of Health (SDoH) are considered moderate risk but only if they “significantly limit diagnosis or treatment.” Consider making this a macro.
• Drug therapy requiring intensive monitoring for toxicity is high risk. The monitoring is not for therapeutic efficacy but to assess for toxic adverse effects. Obvious ones are aminoglycoside levels, monitoring for pancytopenia in context of chemotherapy, digitalis monitoring. Routine levels (e.g., electrolytes, glucose, creatinine) are not counted, but the same laboratory studies can count IF they are time-sensitive in a risky scenario (e.g., treating AKI, severe hypoglycemia).
• Parenteral controlled substances has been added to high risk. This was not originally found in the Office/Outpatient matrix.
• Not all examples are applicable in every setting. For instance, if a patient is inpatient, decision to admit may not be applicable but decision to escalate hospital-level of care, such as transferring the patient to the ICU, may.

It is very important to detail the thought process, especially now that MDM is the SOLE component. You do not want to leave determining the complexity to the auditor’s imagination. Think in ink! Why are you ordering that test? What are you concerned about? How are you addressing that comorbidity?

The alternative to MDM-based billing is time-based billing. The emergency department is excluded from this section. Here are points about time-based billing:

• The patient must be seen face-to-face (F2F) by the healthcare provider (or surrogate, e.g., split/shared visit in hospital – the NPP can do the F2F portion even if the physician is billing), but each moment of time counted does not have to be F2F.
• This is now TOTAL time. There is no “>50% spent in counseling and/or coordination of care.”
• The time should occur in the same calendar day, however, if a continuous service spans two calendar dates (e.g., patient encounter is begun prior to midnight and concludes the next calendar day), it is considered a single service and all the time is applied to the reported date of service.
• The number of minutes must be met or exceeded.
• These are the activities which count for time-based services:
• Preparing to see the patient (e.g., review of tests, reading consultants’ notes or transfer documents)
• Obtaining and/or reviewing separately obtained history
• Performing a medically appropriate physical examination
• Counseling and educating the patient and/or patient/family/caregiver
• Ordering medications, tests, and/or procedures as medically necessary
• Referring to and communicating with other health care professionals (assuming not being separately billed)
• Documentation
• Independent interpretation of non-separately reportable tests and discussing the results with the patient/family/caregiver
• Care coordination (as long as not claiming it as a separately billable service)
• Excluded time:
• Time spent performing services which are separately reportable and billed (no double dipping!)
• Travel
• General teaching that doesn’t specifically benefit the patient

For a patient admitted in the hospital, either inpatient or outpatient status for observation services (OBS), there will be a combined code set now. Initial care would be reported with 99221-99223, and subsequent care is 99231-99233. Discharge services will be billed under 99328-99239 or 99234-99236 for admission and discharge on the same day for either inpatient or OBS.

You only get one initial E/M; if a patient is first placed in OP with OBS services and a bill for initial hospital care is submitted, and then the patient is admitted inpatient, the first IP claim would be for a subsequent visit, not initial. This is not considered a new stay. Only one bill can be submitted in a day, so if a patient is seen in the morning as OBS and transitioned to IP in the afternoon, only one 99221-99223 service would be submitted for that date.

• Inpatient or OBS
• Medicare (does not use the consultation code set):
• Initial: 9922-
• Subsequent days: 9923-
• Commercial insurers who accept consultation codes:
• Initial: 9925-
• Subsequent days: 9923-
• Outpatient without OBS services
• Medicare:
• Initial: 9920-
• Subsequent days: 9921-
• Commercial insurers who accept consultation codes:
• Initial: 9924-
• Subsequent days: 9921-

For general comparison, here is a table with the highest level of E/M and their corresponding work RVU with 2022 values.
One potential comment that you might consider making depends on whether you think a patient who is hospital outpatient in bed, not OBS (e.g., patient in for OP joint replacement who is staying overnight for whom a hospitalist is requested to manage medical conditions), should be billed as O/O or they should change the Inpatient/OBS code set to include all patients seen in the hospital setting. I defer to your clinical experience as to which code set seems more appropriate to you. Under the current RVU schema, it doesn’t seem to make a difference moneywise.

Patients seen in the ED throw a little wrinkle into this coding scenario. If the patient is admitted to the provider who sees the patient in the ED (whether IP or OBS), they should bill an initial hospital IP/OBS code. If the provider is requested to see the patient for evaluation by the emergency physician but the patient is not admitted, then CMS proposes that the other HCP also use an ED E/M code. If the insurer were not CMS, then the latter scenario might warrant a consultation code; remember, CMS does not recognize consultation codes.

Circling back to the Proposed Rule, CMS plans to retain the “8 to 24-hour rule.” The concept is that they don’t want providers to game the system by extending a stay over a midnight just to accrue a second day’s billing.

• Less than 8 hours of IP or OBS, only bill initial IP/OBS care code (9922-)
• 8-24 hours, same-day discharge code (i.e., 99234-99236), even if the stay spans across a midnight. These codes account for the increased resources to perform admission and discharge services.
• > 24 hours, bill initial IP/OBS (9922-) for date of admission and hospital discharge day management (99238-99239) for date of discharge

CMS is not adopting CPT’s prolonged total time code (993X0). They are proposing their own G-code, GXXX1, to describe a prolonged service, which is always and only applied to the highest level of service in a code set (If there is an “X” character in a code like this, it means they haven’t settled on the final code; the X is a placeholder). I can’t even begin to explain this section to you because, although I am pathetic at math, (meeting or exceeding) 75 minutes base for 99223 plus 15 minutes prolonged services equals 90 to me. I don’t understand CMS’ explanation of adding an additional 15 minutes on to start prolonged services at 105 minutes for 99223. I think you should read this section from page 313-318 yourself and send in comments. If you spend inordinate amounts of time with a patient, you want to be appropriately compensated. They want 15 minutes for free. Discharge services are not eligible for prolonged services add-on because that is already built into “more than 30 minutes.”

When split/shared (a service performed conjointly by a physician and a non-physician practitioner) got revamped, CMS wanted to establish their definition of “substantive portion,” which defined who was entitled to bill for the service, as being the individual who expended more than half the total time. There were so many objections (including mine and Dr. Ronald Hirsch’s) that they tabled this pending more discussion. Until January 1, 2024, they are going to continue using one of the three key components (history, physical exam, or MDM) or more than half the total time spent as the substantive portion. After that, they are planning on solely basing it on who spends more than half the time. Isn’t that always going to be the NPP?! If you use them effectively, it will.

They are giving us an opportunity to give more feedback. I implore you to add your voices. If we do not get this changed, there will never be an advantage to performing a split/shared visit, because the provider will expend their time seeing a patient and the encounter will be paid at the NPP’s rate. My assertion is that the substantive portion is the MDM. Furthermore, why would the history or physical establish the substantive portion if they aren’t even going to be factors in selection of the E/M level of service?

In conclusion, there are major changes coming to professional fee billing January 1, 2023. Any clinically practicing colleagues will need to understand the new system and what they need to document to bill the appropriate level of service. And we can offer our comments to hopefully shape the Final Rule. Don’t forfeit that opportunity.