Good or bad idea? Some worry that E/M coding update could underpay doctors with sickest patients

If you listen to the Centers for Medicare & Medicaid Services (CMS), the organization's plans to update evaluation and management (E/M) codes could simplify documentation and free up doctors’ time to spend with patients.

Or, it could leave physicians who treat high-acuity patients underpaid.

That's the reaction from physician groups after CMS released its proposed rule on the 2019 physician fee schedule last week in which CMS announced plans to change E/M codes as a way to simplify documentation and give doctors more time with patients and less in front of a computer screen.

Almost immediately, the Community Oncology Alliance, a nonprofit association of independent oncology centers, slammed the idea.

“Their scheme to pay a physician the same amount for evaluating a case of sniffles and a complex brain cancer simply defies all logic. It is the antithesis of value-based healthcare and cheapens the medical care seniors are entitled to under Medicare,” Ted Okon, executive director of COA, said in a statement, posted the day after CMS released the proposed rule. 

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In its statement about proposed changes to the physician fee schedule, the American Hospital Association said it would mean underpayment for some doctors.

“Providing substantially less ability to distinguish evaluation and management codes for different levels of resource use and intensity of services means that physicians who provide care for a disproportionate number of high-acuity patients would consistently, and unfairly, receive underpayment,” the group said.

The American College of Rheumatology also came out in opposition to the proposed change. With groups such as MedPAC recognizing that E/M services are already undervalued, rheumatologists are worried additional cuts will exacerbate a growing rheumatology workforce shortage, said ACR president David Daikh. 

Other physician groups, including the American Medical Association, the largest physician group in the country, are examining the proposal. 

“The AMA is evaluating how this proposal will affect patients, especially those with complex conditions, and we will be carefully evaluating the impact across various types of patients and specialty practices,” said the AMA President Barbara L. McAneny, M.D.

CMS makes its case for change

To make its case, CMS took to Twitter on Wednesday for a livestream panel discussion that included CMS Administrator Seema Verma and four government doctors who had input into the proposed rule to talk about the benefits of the new E/M system.

The doctors included Kate Goodrich, M.D., CMS’ chief medical officer and director of the Center for Clinical Standards and Quality; Don Rucker, M.D., the National Coordinator for Health Information Technology; Anand Shah, M.D., chief medical officer of the Center for Medicare & Medicaid Innovation at CMS; and Thomas Mason, M.D., chief medical officer in the Office of the National Coordinator for Health Information Technology (ONC).

In the Twitter discussion, Verma reiterated the message she communicated in a “Dear Doctor” letter sent on Monday to various clinician groups, saying the proposed overhaul of the E/M documentation and coding system is part of the initiative to reduce the burden of unnecessary rules and requirements.

The change will dramatically reduce the amount of time that doctors need to spend inputting unnecessary information into their patients’ records, she said.

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E/M visits make up 40% of all charges for Medicare physician payment, so changes to the documentation requirements for these codes would have a wide-reaching impact, she said.

So, what exactly will change? The current system of E/M codes includes five levels for office visits.

Level 1 is primarily used by nonphysician practitioners, while physicians and other practitioners, such as nurse practitioners and physician assistants, use levels 2 through 5. The differences between levels 2-5 can be difficult to discern, as each level has unique documentation requirements that are time-consuming and confusing, Verma said. Physicians must justify the level of the E/M code by documenting care in the patient chart, which then allows them to bill Medicare. Codes with a higher level translate to a more expensive visit.

Now, CMS has proposed to move from a system with separate documentation requirements for each of those four levels to a new system with just one set of requirements and one payment level each for new and established patients. CMS estimates that the change will save 51 hours of clinic time per clinician per year, Verma said. Doctors will need to document to the current level 2 requirements.

A costly proposal?

“Most specialties would see changes in their overall Medicare payments in the range of 1%-2% up or down from this policy, but we believe that any small negative payment adjustments would be outweighed by the significant reduction in documentation burden. If you add up the amount of time saved for clinicians across America in one year from our proposal, it would come to more than 500 years of additional time available for patient care,” Verma wrote to doctors.

RELATED: Primary care doctors spend more than 50% of workday on EHR tasks, American Medical Association study finds

But for some doctors, that new system is just too simple—with one payment level no matter the complexity of a patient visit. The Community Oncology Alliance said physicians could face drastic cuts in payment, especially while overseeing life-threatening, complex cases.

Under the proposal, oncologists would see a reduction for the critical evaluation and management of more complex cancer cases from $172 to $135 (a 22% cut) for a new patient and from $148 to $93 (a 37% cut) for an existing patient, the group said.

Yesterday, in the half-hour Twitter discussion, the panel doctors talked about the reasons why doctors should support the new coding system. But Verma was careful to note the plan is a proposal and the agency is looking for doctor feedback during the 60-day comment period on the proposed rule.

Shah, who is also a radiation oncologist at the National Cancer Institute, said CMS is aware of concerns, particularly in oncology, that doctors would not receive the same level 4 and 5 payments. But he said the shift that CMS estimates at 1% to 2% would be made up for in improved productivity, as doctors would save time documenting in patient records. He said officials anticipate that many commercial payers will opt to follow CMS’ lead to simplify E/M coding.

Government doctors tout the benefits

There has been a consensus among doctors that the current system “is just not working,” Rucker said. Doctors are required to include lots of documentation for billing purposes that leads to “note bloat,” he said.

The real clinical information that doctors need to share as part of the electronic health record gets hidden in the reams of information, he said. New doctors can spend more time worrying about documentation than the patient. There is also a lot of money spent on E/M codes, as practices have billing and coding specialists working on submitting the charges for office visits to Medicare.

When they see a complex patient, doctors need to decide the level of an office visit and are required to document specific details, such as how many organ systems they evaluated during the physical exam, Goodrich said. The E/M changes would require minimum documentation for levels 2-5 and a single payment rate for any of those levels. Doctors would no longer have to cut and paste redundant information, such as past medical history or family history, for patients if it is already in the medical record, she said. They would only need to document new information.

One recent study found that that U.S. physician clinical notes are, on average, four times as long as those in other countries, and speculated that regulations that require doctors to document patient care may be responsible.

And that may be part of the reason why the EHR is driving doctors’ dissatisfaction and burnout. Studies have found that U.S. doctors now spend as much time interacting with the computer as they do face-to-face with patients.

“We think the gains in time are going to be large,” Rucker said. Practices spend varying amounts on billing, but he said CMS thinks savings will accrue. Officials also think the change will have a significant impact on the EHR and usability, he said. Not only will the changes “take the clutter out” of EHRs for doctors, it will also help computers mining records for big data, he said.