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Practice Management & Allied Staff News & Materials

CMS to Stop Payment for Consultation Codes Effective January 1

December 30th, 2009

The 2010 Medicare Physician Fee Schedule released in the November 25 Federal Register, finalizes CMS's proposal to stop making payment for consultation codes (with the exception of G codes used to bill for telehealth consultations). The resulting savings will be redistributed in a budget neutral fashion, increasing payments for existing evaluation and management (E/M) services. CMS will adjust the payment for the surgical global period to reflect the higher value of the office visits furnished during the global period. CMS cites various rationales for this new policy including, but not limited to: (1) differential payment for a consultation service is no longer supported because documentation requirements are now similar across all E/M services, (2) local policy interpretations by Medicare contractors are not universally equivalent or acceptable to the physician community resulting in denials in different localities, and (3) terms such as referral, transfer and consultation, used interchangeably by physicians in clinical settings, confuse the actual meaning of a consultation service and that interpretation of these words varies greatly among members of that community as some label a transfer as a referral and others label a consultation as a referral.

A recent CMS Transmittal and MLN Matters articles MM6740 and SE1010 further explain what this means for providers.

Some important points to note:

  • The new policy only applies to physicians billing the Medicare fee-for-service program. It does not apply to Medicare Advantage or non-Medicare insurers.

  • In the inpatient hospital setting and nursing facility setting, any physicians and qualified NPPs who perform an initial evaluation may bill an initial hospital care visit code (CPT code 99221 - 99223) or nursing facility care visit code (CPT 99304 - 99306), where appropriate. This means more than one provider can report a code in the 99221 - 99223 range on the same day for the same patient. The principal physician of record will append modifier "-AI" Principal Physician of Record, to the E/M code when billed. This modifier will identify the physician who oversees the patient's care from all other physicians who may be furnishing specialty care. All other physicians who perform an initial evaluation on this patient will bill only the E/M code for the complexity level performed. However, claims that include the "-AI" modifier on codes other than the initial hospital and nursing home visit codes (i.e., subsequent care codes or outpatient codes) will not be rejected and returned to the physician or provider.

  • Emergency department visits (codes 99281 - 99288) - physician billing for emergency department services provided to patient by both patient's personal physician and emergency department (ED) physician. If the ED physician, based on the advice of the patient's personal physician who came to the emergency department to see the patient, sends the patient home, then the ED physician should bill the appropriate level of emergency department service. The patient's personal physician should also bill the level of emergency department code that describes the service he or she provided in the emergency department. If the patient's personal physician does not come to the hospital to see the patient, but only advises the ED physician by telephone, then the patient's personal physician may not bill.

Note that while CMS has decided to stop payment for consultation codes, the referring doctor's name and NPI should still appear in box 17 of the claim form when clinical documentation shows a referral has been made. Proper documentation requirements must still be followed.

For additional information be sure to read the CMS Transmittal and MLN Matters articles MM6740 and SE1010. AAOMS will continue to monitor this issue to keep you informed.