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E&M Code Level Consolidation On the Table… Again

October 3, 2018

Contributed by Ray Jorgensen

Back in 1996 when I became the first CPC in RI and one of only seventeen in New England, we were all still adjusting to the 1995 Evaluation and Management (E&M) Guidelines. Moans and groans by providers about the burden… with paper records… were common and I think legitimate. In February of 1998, I started my solo consultant career with a three-prong product line: E&M training, E&M chart Audits, and teaching the AAPC’s CPC course. When the very existence of the new 1997 E&M Guidelines were again met with consternation by the AMA and most in the provider community, threats of E&M level dissolution loomed. Selfishly, I was concerned my fledgling company would fail if only because two of my three product lines would be irrelevant.


In short, despite the AMA/CMS “fly-in” meeting in Chicago in April of 1998 (at which I represented a couple of regional and national groups) where issues were to be addressed if not resolved, the only outcome was flexibility. Use either the 1995 or the 1997 Guidelines but the E&M documentation requirements were here to stay. Since 1998 there have been regular and repeated uprisings advocating E&M documentation simplification such as shrinking of E&M levels from five to two or three. However, I think this current CMS proposal (within the 27-July published 2019 Medicare Professional Fee Schedule (a.k.a., MPFS or just PFS) for some reason feels like it might stick.


First a quick overview:

  • History and Exam documentation no longer have exacting standards (e.g., X number of HPI, and Y elements of ROS are gone) and instead allow the clinician at his/her discretion to document what is clinically necessary to care for the patient and convey to other providers viewing the record what they need to know.
  • Medical Decision Making (MDM) becomes the element that determines E&M levels. From teaching E&M coding to clients in all fifty states, coding can be viewed as a game and the way the three MDM tables exist, getting 60-70% of visits to Moderate Complexity (the third of four possible levels) is, well, pretty simple.
  • Medical subspecialties making most of their money from E&M coding and will have “add on” G codes to compensate additionally for “inherent complexities” within their specialties.
  • Consolidating payment for New Patient E&M service (i.e., 99201-99205) to $44 for 99201 and a flat rate of $135 for 99202-99205. For established Patient E&M (i.e., 99211-99215), the new rates would be $24 for 99211 and flat $93 for all other levels.

The AMA and other provider advocacy groups (to date, more than 150 of them) are against the E&M code/payment consolidation despite CMS touting this “simplification” of E&M as an effort to mitigate documentation burden on providers. CMS has said it will save providers 51 hours a year. Really? A little less than an hour per week? That seems like lame rationale.


Further, docs and NPPs with whom I’ve spoken all say their EMR products still mandate a painstakingly methodical process just to get through visit documentation. Certainly this could/will change but in the end, in this author’s opinion, the motivation by CMS is money. Well, at least that is my thought whenever the government proposes a fee consolidation. However, a quick look at some bell-curved E&M data presented a different picture.


The above is based on 1,000 Medicare patients paid under the PFS. Here’s a quick column review:

  • Medicare 2018 $ are the fees in the 2018 Medicare PFS.
  • Proposed New $ are the proposed payments in the CMS E&M payment consolidation.
  • Bell Curve % is the percentage distribution of the 1,000 patients.
  • Bell Curve 2018 $ is the 2018 $ row dollar amount times the Bell Curve % row amount times 1,000.
  • Bell Curve Proposed New $ is the New $ row dollar amount times the Bell Curve % row amount times 1,000.

I did make up the Bell Curve % column data to represent distribution of the 1,000 patients. I think, based on my work conducting thousands of chart audits along with more than 20,000 hours of E&M training/consulting that this well-represents average coding distribution of primary care and a good number of medical subspecialists. Make up your own chart to use your data if that helps.


Regardless, what was shocking to me was the very little change in compensation resulting from the new payment proposal. Certainly if you are specialists making a living at 99204-99205 and 99214-99215, maybe your lose a few dollars BUT:

  • G codes exist to boost most medical specialist payments so include those in your own analysis.
  • Bet you save time and money from doing preventive and/or defensive chart auditing.
  • Promise you will lose less sleep and save money from paying fines and/or lawyers to defend you from aggressive payment recovery tactics imposed by third party payers.

But I digress.


So, for CHCs, what does this mean? Frankly, not a whole helluvalot. The PPS rates for Medicare and Medicaid (achieved either directly from straight Medicare and straight Medicaid, via Medicare Secondary Payer, and/or wrap payments) assure CHCs are “whole” in terms of potential payment for the vast majority of E&M services rendered to CHC patients. If PPS comes under attack, well, that’s a different conversation all together as PPS is the financial backbone for the CHC marketplace.

In the end, read as much as you can if interested but until a final rule is published by CMS this is little more than political jockeying. The AMA owns copy and distribution rights for CPT in which the E&M codes are annually published. They are not the decision making body about payment or documentation requirements as that rests with CMS and the commercial payers. In the immortal words of Mark Twain, “Worrying is like paying interest on a debt you may never owe.” So, don’t worry and keep on keeping on. If this comes to pass, like all else, we will figure it out.

Editor’s Note: This post was contributed by Ray Jorgensen, Co-Founder of PMG. Ray has decades of experience in revenue cycle management which includes time at Blue Cross & Blue Shield of Massachusetts and UnitedHealthcare in hospital claims, customer service, provider relations and contracting. When he’s not at the helm at PMG, Ray spends his time with music or perfecting his golf stroke. 

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