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Jan 13

E/M Coding: 2021 Office Coding Changes

On January 1, 2021 the first overhaul of the Evaluation and Management (E/M) office visit codes in almost 30 years, including significant revisions to the E/M CPT code descriptors and standards of documentation, takes effect. The purpose of these revisions is to address the administrative burden that physicians face related to these codes. Moving forward documentation for E/M office visits will be more closely centered in the way physicians naturally think and care for their patients.

What are the current E/M coding standards?

Currently, the AMA uses the E/M CPT codes set that is has been in place since the late nineties. This code set provides guidance on selecting the appropriate code based on patient history, clinical examination, and the level of medical decision-making (MDM) involved in a single face-to-face encounter.

With regard to patient history, this is determined through the Review of Systems (ROS), in which the provider asks the patient to describe any symptoms they’re experiencing across multiple body systems. The more systems a provider reviews with the patient, the higher the corresponding coding level.

Similarly, the clinical examination involves the provider physically reviewing body systems corresponding to the symptoms provided by the patient. Again, the more systems the provider examines, the higher the coding level.

Medical Decision Making (MDM) is subjective and involves the provider making an evidence-based decision with regard to the patient’s health. MDM is stratified into four categories – straightforward, low complexity, moderate complexity, and high complexity –  by analyzing the visit based on the number and nature of clinical problems, the amount and complexity of data the physician must review, and the risk of mortality and morbidity to the patient.

It is also possible, in select instances, to choose a code based upon time spent with the patient, but this is only applicable when more than 50% of the time spent in the encounter is made up of counseling, coordination of care, or both. Regardless of how the code is chosen, generally speaking, a higher coding level corresponds with a higher reimbursement for the provider.

What are the 2021 E/M Coding changes?

When the new coding changes take effect on January 1, 2021, Medical Decision Making (MDM) will remain intact as a valid option for code selection.

There will no longer be quantifiable requirements for number of systems reviewed or number of systems examined, however, these items will continue to warrant notation as supporting documentation for medical necessity will still be important.

Another big change for 2021 is the description of a “Problem Addressed.” A problem is considered to be addressed when the provider actually evaluates and treats the problem during the encounter. This can include the consideration of further treatment or testing, even if the patient ultimately rejects that course of action. Regardless, it is important to document exactly what is done with regard to the problem. Additionally, referring the patient to another provider without first evaluating the problem also does not qualify as addressing the problem.

In addition to the changes made to the MDM component of code selection, there is the expanded option of coding according to time. Practitioners now have the choice, for all encounters, to code according to time if they so choose. When coding according to time, providers must use the definition of minimum time, not typical time, and it should represent the total time the physician or other qualified health professional spent caring for that patient on the date of service for which they are coding.

When coding for time, physicians or other qualified health professionals can include the following activities, provided they occur on the date of service in question:

  • preparing for the patient visit, such as reviewing test results
  • obtaining or reviewing history
  • performing a medically necessary examination/evaluation
  • educating or counseling the patient, as well as their family and/or caregiver
  • ordering tests, medications, or procedures
  • referring to and communicating with other providers, as long as this has not been reported separately
  • documenting clinical information in the EHR or paper chart, if applicable
  • independently interpreting results, provided this has not been otherwise reported, and communicating those results with the patient, as well as their family and/or caregiver
  • care coordination that has not been otherwise reported

It’s important to note that if two qualified healthcare professionals in the same practice see the same patient on the same day, time can only be counted once and in total.

What impact will this have on practices?

Of course any change of such great magnitude will affect the healthcare industry on every level, including the practice level. In this case, it seems the largest impact on practices as a whole will be in regards to revenue, particularly when billing for patients on Medicare.

CMS reports that CPT codes 99201-99215 account for 40% of all reported CPT codes and 20% of revenue.

As you can see, this is likely to be a fairly big deal on the financial front for any practice. Relative Value Units (RVUs) for E/M codes are increasing in 2021, which seems positive, however it’s important to remember that all changes to the Medicare physician fee schedule must be budget-neutral, meaning that if RVUs for E/M are going up, there must be cuts made somewhere else in order to pay for those increases.

In other words, in order to offset the increased spending from the E/M changes, CMS will have to make some reductions across the board. Some experts in the industry are predicting that this cost offset will come in the form of reductions to the physician conversion factor, thus reducing payment for all services rendered under the physician fee schedule. Others believe CMS may lower the RVUs on procedures. The idea is that when all is said and done, the financials should even out, although it may serve to increase revenue in a few ways.

As providers will now be able to count work time for a patient that may not have otherwise been billable, that could allow for the potential to code at higher levels. This is something that will depend on the provider, and speaks to the importance of evaluating the way in which coding is completed now and looking at the new guidelines to see what will be the best course of action moving forward. Doing so will potentially lead to changes in workflow, which could require an adjustment period, but in the end bring a benefit.

Download our 2021 E/M office visit coding ebook for guidance on how to prepare your practice for these revisions. 

What are some general impacts on payers? 

While the impact on practices will arguably be more pronounced than that on payers, this doesn’t mean that payers won’t see any differences as a result of these code changes. When these coding changes take effect January 1, 2021, the type of coding seen by payers, both CMS-regulated and commercial, will be markedly different from that which they’ve previously reimbursed. This will require an adjustment period and special attention. There are also some policies that have been put in place by CMS related to the E/M coding changes that have the potential to impact payers across the board.

Namely, there is the reduction of payment variation through establishing a single rate for levels two through four of E/M office visits. CMS is also implementing add-on codes in order to describe additional resources needed for certain visits. Plus, there is the new “extended visit” add-on code for visits of levels two through four. All of this will present new items for payers to be aware of, creating the possibility for a slight learning curve as the changes become established.

As with any change in our industry, some nerves are normal regarding changes to our coding practices, particularly as this is an area that so closely affects our practice’s financials. With some proactivity and preparation, this transition can take place smoothly and without any adverse effects for your practice.

At MicroMD we’re ready to help. Our Practice Management software is up-to-date on all of the latest coding pieces so that you can have the peace of mind that you’re ready to face this change.

Other sources: https://veradigm.com/veradigm-news/new-year-new-rules-medicare-eval-mgmt-changes-are-here/

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E/M office coding changes are set to take effect in 2021 – how can your practice prepare for these revisions and what do they entail? Find out.

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