why consultation codes are not covered by Medicare

Consultation Codes


In the proposed rule, CMS requests input on Medicare coding and payment policies, including the discontinuation of CPT consultation codes this year. As conveyed in a June 18 letter signed by the AMA and 33 medical specialty organizations, the policy has forced some physicians to cut back services to Medicare patients and discouraged communication between clinicians at the very time CMS is looking for ways to improve care coordination. A survey of affected specialties suggests that continuation of the current policy will lead to additional cutbacks in care and make it impossible for many specialists to purchase electronic medical records systems and adopt new technologies required to launch the transformation envisioned in the ACA.

Specific Survey Findings include:

• Twenty percent of the 5,500 physicians who completed the survey have reduced the number of new Medicare patients in their practice, 12% have reduced time spent with Medicare patients and 10% have reduced or eliminated consultations on hospital inpatients.

• Thirty-nine percent say they will defer purchase of new equipment and/or information technology to compensate for lost revenues. More than a third (34%) are eliminating staff.

• Six percent have already followed CMS’s suggestion that they no longer need to send a written report back to the referring physician and 19% plan to stop providing a report.

• Although CMS predicted that no specialty would see Medicare revenues decline by more than 3%, nearly three-fourths (72%) of survey respondents saw declines of more than 5% and 30% faced losses greater than 15%.

These findings confirm the AMA’s view that CMS should reverse its current policy and resume payment for consultation codes in Medicare. If the agency declines to adopt a complete solution, it should, at the very least, modify two other policies—involving prolonged services and new patient definitions—that have compounded the problem caused by elimination of the consultation codes.

As laid out in the previously-mentioned letter, in determining whether a service meets the prolonged service criteria, CPT stipulates that, for the inpatient setting, in addition to time spent “face-to-face” with patients, physicians can include time spent on the patients’ floor or unit performing other tasks related to their care. Were CMS to apply the same definition as CPT, consulting specialists could use the prolonged services to obtain fairer reimbursement for particularly long and challenging cases they previously would have billed as consultations. CMS only recognizes the face-to-face time, however, and further discourages coordination of care by essentially denying payment for activities such as creating and reviewing charts, communicating with the family and coordinating with other health care professionals. Cases where it would benefit a physician to use the prolonged service code are relatively limited and their use could be monitored through claims edits. Consequently, it does not appear that conforming to CPT policy on these codes would lead to large increases in Medicare expenditures and the AMA is again requesting that CMS modify its interpretation of the prolonged service codes to match the CPT descriptors.

The issue involving new patient definitions occurs because unlike the consultation codes, visit codes distinguish between new and established patients. The difference can be significant—about $60 for the most complex office visits—and it affects a substantial number of specialist physicians. In the aforementioned survey, for example, 33% of all respondents and more than 70% of some specialties said that more than 25% of their consultations in 2009 were with patients who had been seen previously by another member of the same specialty and group within the past three years.

In CPT, new patients are defined as those who have not been seen by the same physician or another member of the same group and sub-specialty within the last three years. In Medicare, however, a new patient is one “who has not received any professional services, i.e., E/M service or other face-to-face service (e.g., surgical procedure) from the physician or physician group practice (same physician specialty) within the previous 3 years. The problem is that physicians often focus on a narrower range of services than are recognized in Medicare’s current list of 42 medical specialties. Thus, for example, if an electrophysiologist treats a particular patient and two years later, the patient is seen by an interventional cardiologist in the same group, the patient will be viewed as an established patient even though the two cardiologists have different areas of expertise.

The current situation is inequitable and the AMA believes that Medicare should comply with the CPT policy of identifying patients seen by physicians in a different sub-specialty as “new” patients. As pointed out in the June 18 letter, correcting its budget neutrality assumptions would provide some additional funding CMS could use to offset or partially offset any cost associated with this change. We recognize, however, that due to variations in the way that different specialties have dealt with the issue of extended training and focused expertise, setting the criteria for determining Medicare-recognized sub-specialties or equivalent expertise will require some further analysis. The AMA would be pleased to assist CMS in identifying affected specialties and creating a work group that could help with this analysis.