Distribution of level 2 to 5 outpatient evaluation and management (99202-99205, 99212-99215) codes used by different specialty types was determined using 2013 Medicare data.
The financial impact of collapsing payments at the physician level was estimated by calculating the difference of actual annual payments for outpatient evaluation and management work and projected annual payments with the proposed policy change.
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Callaghan BC, Burke JF, Skolarus LE, Kerber KA. Assessment of Proposed Changes to Evaluation and Management Billing Levels by Physician Specialty. JAMA Neurol. 2019;76(2):231–232. doi:10.1001/jamaneurol.2018.3794
The Centers for Medicare and Medicaid Services (CMS) has proposed collapsing payment amounts for levels 2 to 5 evaluation and management (E/M) services (currently $45-$211) into single payments. The proposed single payments (return visits, $93; new patients, $135) are between current rates for levels 3 to 4. Advantages of this proposal include reducing documentation requirements and auditing burden. However, this policy will disadvantage specialties that typically bill at higher E/M levels. Neurologists might be particularly susceptible to changes in E/M reimbursement because the majority of their Medicare payments are from these services.1 To better understand how this change would differentially impact specialties and specifically neurologists, we compared the current billing levels across specialties and used this information to estimate the financial impact of this proposal.
We used the 2013 Medicare Physician and Other Supplier File to determine the distribution of outpatient E/M (99202-99205, 99212-99215) codes for levels 2 to 5 used by different specialty types and the proportion of total payments for all physician services attributable to these outpatient E/M codes. We estimated the financial impact of collapsing payments at the physician level by calculating the difference of actual annual payments for outpatient E/M work and projected annual payments with the proposed policy change. This study was exempt from institutional review board approval because publicly available data were used.
In 2013, the proportion of outpatient E/M codes billed at levels 4 to 5 varied substantially by specialty. For neurologists, 70% (3.9 million of 5.6 million) of the outpatient physician E/M codes were for levels 4 to 5, which was the highest of any specialty (Figure 1). Other high users of codes for levels 4 to 5 included cardiologists (12.0 million of 18.4 million [65%]) and other medical specialists (14.8 million of 24.2 million [61%]). In contrast, the lowest users of codes for levels 4 to 5 included dermatologists (1.1 million of 10.3 million [11%]), orthopedists (2.3 million of 10.4 million [22%]), and otolaryngologists (1.3 million of 5.1 million [25%]).
For neurologists, the median proportion of Medicare payments from physician outpatient E/M codes was 50% (interquartile range [IQR], 27%-73%), which was the sixth highest physician type. The highest E/M–dependent specialists were general/family practitioners (median, 87%; IQR, 59%-98%), obstetrician-gynecologists (median, 64%; IQR, 39%-87%), and otolaryngologists (median, 60%; IQR, 47%-73%). The lowest E/M–dependent specialists were ophthalmologists (median, 6%; IQR, 0%-18%), cardiologists (median, 31%; IQR, 21%-43%), and other medical specialists (median, 32%; IQR, 15%-63%).
Considering the distribution and volumes of E/M services at the physician level, the financial impact of the CMS policy to collapse billing levels is typically favorable for surgical specialties, neutral for generalists, and unfavorable for neurology and medical specialists (Figure 2). The typical neurologist would lose a median of $3226 (IQR, −$9741 to $0). Other specialists who would be negatively affected include cardiologists (median, −$3203; IQR, −$11 493 to $509) and other medical specialists (median, −$978; IQR, −$5664 to $847). Specialists who would benefit include dermatologists (median, $16 655; IQR, $6680-$33 823), otolaryngologists (median, 6619; IQR, $1216-$14639), and orthopedists (median, $6239; IQR, $1695-$12860).
We found that collapsing E/M rates would differentially affect specialties with neurologists the most negatively. Neurologists have the most to lose with this proposal because they code levels 4 to 5 the most relative to other E/M codes, and a higher proportion of their payments come from E/M compared with other specialists such as cardiologists and other medical specialists. Conversely, the CMS proposal would increase payments most for dermatologists, otolaryngologists, and orthopedists.
Collapsing E/M payments would likely incentivize all physicians to shorten visit times at a time when the current trend is toward longer visits.2 Previous studies have shown that other physician financial incentives to shorten visits such as capitated plans and performance-based payment mechanisms are associated with shorter visits.3,4 Given that longer visit times are associated with higher patient satisfaction and important elements of care, the CMS proposal would likely have negative consequences.5,6 Current E/M payments strongly undervalue the cognitive work of physicians compared with procedural-based payments. Based on our data, the recent proposal to collapse E/M payment levels would further undervalue these important services, particularly for neurologists.
Corresponding Author: Brian C. Callaghan, MD, MS, 109 Zina Pitcher Pl, 4021 BSRB, Ann Arbor, MI 48104 (email@example.com).
Accepted for Publication: October 12, 2018.
Published Online: October 31, 2018. doi:10.1001/jamaneurol.2018.3794
Author Contributions: Dr Kerber had full access to all of the data in the study and takes responsibility for the integrity of the data and the accuracy of the data analysis.
Concept and design: Callaghan, Burke, Kerber.
Acquisition, analysis, or interpretation of data: Callaghan, Skolarus, Kerber.
Drafting of the manuscript: Callaghan.
Critical revision of the manuscript for important intellectual content: All authors.
Statistical analysis: Callaghan, Kerber.
Administrative, technical, or material support: Burke.
Conflict of Interest Disclosures: Dr Callaghan reported grants and personal fees from American Academy of Neurology outside the submitted work; grants from the National Institutes of Health and Veterans Affairs Clinical Science Research and Development outside the submitted work; consults for a Patient-Centered Outcomes Research Institute grant, the Immune Tolerance Network, and DynaMed Plus; and performs medical legal consultations. Dr Burke reported personal fees from AstraZeneca, personal fees from American Heart Association, and grants from National Institutes of Health and National Institute of Neurological Disorders and Stroke outside the submitted work. Dr Skolarus reported grants from National Institutes of Health/National Institute of Neurological Disorders and Stroke during the conduct of the study and has consulted for Bracket Global regarding poststroke disability. Dr Kerber reported personal fees from American Academy of Neurology and grants from the National Institutes of Health/National Institute of Neurological Disorders and Stroke and Agency for Healthcare Research and Quality outside the submitted work. The authors have received American Academy of Neurology research for previous projects.
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