CMS Proposes One Rate for E/M Code Levels 2 through 5 and Documentation Reduction

Stethoscope and Medical Chart

On Friday, July 27, the Federal Register will publish proposed rule changes to the CMS Part B Physician Fee Schedule. If adopted, the new rules will apply to services furnished beginning January 1, 2019. The 1,400+ page set of proposed rules contain significant changes to the current E/M system.

While some of the proposed rules will result in higher physician reimbursement, such as unbundling non-face-to-face patient communication, others may result in lower reimbursement rates.

One Rate for E/M Code Levels 2 through 5

The most significant change proposed in the 2019 rules is the compression of rates for E/M visit codes level 2 through 5 into one rate. Hidden under the section titled “Minimizing Documentation Requirements by Simplifying Payments,” CMS proposes to pay one rate for E/M visits level 2 through 5 for both new and existing patients. Despite caution from CMS stakeholders to proceed slowly with any changes to the outdated and difficult E/M coding system, CMS has proposed a drastic rate alteration to some of the most commonly reimbursed codes.

Image of a table that describes CMS rates and comparisons.

After recognizing the burdens associated with coding and documentation for levels 2 through 5, CMS proposed the one rate to “simplify payment” of these codes. At the same time, CMS is also proposing to create additional G-codes to capture resources and inherently complex visits that require work beyond the proposed one rate.

While the proposed system may simplify payment and documentation requirements, it will come at a price for some providers and practices. CMS believes that any payment reduction practitioners may see in certain levels, will be offset by the rate increase in other levels, and a reduction to administrative costs due to the reduction in documentation. Practices will need to run their own revenue estimate for 2019 using the new rates and determine potential administrative savings to predict how the proposed one rate will affect their bottom line.

Documentation Reduction and Component Choice

Because there would be no payment differential under the proposed one rate, CMS is also proposing a documentation reduction. Proposed rules would reduce the documentation requirement for E/M levels 2 through 5 (CPT codes 99201 through 99215) to the current requirement associated with level 2 regarding history exam, and/or medical decision-making. CMS also proposes allowing practitioners to choose between either medical decision-making or time as a basis for determining the appropriate level of E/M visit. Practitioners will also have the option to continue documenting to the current 1995 and 1997 Documentation Guidelines. Regardless of which method they choose, practitioners would be paid one rate, as proposed in the 2019 rule changes. While CMS proposes to reduce the documentation required for reimbursement, Practitioners should still continue to document for clinical, legal, and operational purposes and to meet the requirements of other payers.

CMS also proposes to eliminate the need to re-enter information that is already contained in the medical record or entered by an ancillary staff member.

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