Medicare Update March 11, 2008

1. Medicare Update March 11, 2008 Debra L. Patterson, M.D. J4 MAC Medical Director TrailBlazer Health Enterprises, LLC

3. November 2007 CERT Report - Part B Carrier Combined Error Rate by Type of Error Claims Submitted 4/1/2006 - 3/31/2007 Paid Claims Error Rate 4.8%

4. November 2007 CERT Report - Part B TrailBlazer TX Top 10 BETOS on Projected Improper Payments Claims Submitted 4/1/2006 - 3/31/2007 16.7% 6.0% 8.2% 8.2% 13.1% 10.8% 10.0%

5. Evaluation and Management Services • Correct coding based on two distinct but related sets of criteria • Medical reasonable and necessity criteria set the following • Appropriate frequency • Upper and lower limits of appropriate intensity of service • Key component “work” defined by the correct medically reasonable and necessary must be demonstrated

6. Medical Necessity Defined

7. Medical Necessity • Statute • National Coverage Decisions • Local Coverage Determinations • Clinical judgment considering the “rules” • Safe and effective • Meet but not exceed patient’s need • Accepted standard of medical practice • Medical literature • Practice guidelines • Respected textbooks • Authoritative opinion

8. Medical Necessity – Beyond E/M • Medical literature

9. Medical Necessity – Beyond E/M • Medical literature

10. Medical Necessity – Beyond E/M • Medical literature

11. Medical Necessity – Beyond E/M • Medical literature

12. Medical Necessity – Beyond E/M • Medical literature

13. Medical Necessity – E/M The nature of presenting problem(s) • Severity • Acuity • Number • Diagnostic complexity • Therapeutic complexity • Counseling and coordination

14. Medical Necessity – E/M Medical Decision Making • # of diagnoses and/or management options • Amount and complexity of medical records, diagnostic tests, and/or other information • Risk of significant complications, morbidity, and or mortality due to • Nature of Presenting problems • Diagnostic tests performed or ordered • Therapeutic options chosen • Number • Therapeutic complexity • Diagnostic complexity • Severity • Acuity

15. Medical Necessity Frequency • Acute problems – generally frequency not an issue • Sub-acute problems (with or without physician intervention) • Incomplete resolution • Potential for worsening, recurrence or negative consequences • Acute problem resolved but outcome was still questionable when last seen

16. Medical Necessity Frequency • Chronic conditions • For stable, well controlled, or inactive conditions • Consider likelihood for problem to deteriorate or become uncontrolled based on the nature of the problem and documented patient behavior/past history • Use published guidelines regarding accepted standards of care for specific problems (when available) • Treat poorly controlled, decompensated, or exacerbated problems as acute

17. Medical Necessity Intensity of service • Nature of the presenting problem • Severity • CPT Medical Necessity Guidance • Contributory factor statements known as “Nature of Presenting Problems” (NPP) contained in most CPT E/M codes.

18. 99201 “Usually the presenting problems are self-limited or minor.” 99202 “Usually the presenting problems are of low to moderate severity.” 99203 “Usually the presenting problems are of moderate severity.” 99204 “Usually the presenting problems are of moderate to high severity.” 99205 “Usually the presenting problems are of moderate to high severity.” Medical Necessity in Evaluation and Management Services

19. 99231 “Usually the patient is stable, recovering, or improving.” 99232 “Usually the patient is responding inadequately to therapy or has developed a minor complication.” 99233 “Usually, the patient is unstable or has developed a significant complication or a significant new problem.” Medical Necessity in Evaluation and Management Services

20. “self-limited or minor” . Medical Necessity in Evaluation and Management Services “low severity” A problem where the risk of morbidity without treatment is low; there is little to no risk of mortality without treatment; full recovery without functional impairment is expected A problem that runs a definite and prescribed course, is transient in nature, and is not likely to permanently alter health status or has a good prognosis with management/compliance

21. “moderate severity” . Medical Necessity in Evaluation and Management Services “high severity” A problem where the risk of morbidity without treatment is extreme; there is moderate to high risk of mortality without treatment OR high probability of severe, prolonged functional impairment A problem where the risk of morbidity without treatment is moderate; risk of mortality without treatment; uncertain prognosis OR increased probability of prolonged functional impairment

22. CPT Appendix C – Clinical Examples 99231 Subsequent hospital visit for 50-year old male with an uncomplicated myocardial infarction who is clinically stable and without chest pain. 99232 Subsequent hospital visit for an 54-year old female admitted for myocardial infarction , but who is now having frequent premature ventricular contractions. 99233 Subsequent hospital visit for a 65-year old male, following an acute myocardial infarction, who complains of shortness of breath and new chest pain. . Medical Necessity in Evaluation and Management Services

23. Medical Necessity Other characteristics of the encounter • Number of problems • Diagnostic complexity • Therapeutic complexity • Counseling and coordination

24. Medical Necessity • Other characteristics of the encounter • Appropriate for the problem/complaint • Supports conclusions • Supports evaluations and treatments chosen • Well documented

25. Medical Necessity • Medically reasonable Medical Decision Making regarding one or more problems out of proportion to severity of illness • Large number of lower severity problems or clearly defined co-morbidities evaluated/managed during one encounter • Extensive medically necessary data review • Extensive medically necessary diagnostic and/or therapeutic interventions

26. Medical Necessity • Medically reasonable Medical Decision Making regarding one or more problems out of proportion to severity of illness • Extensive medically necessary data review • Extensive medically necessary diagnostic and/or therapeutic interventions

27. Medical Decision Making MDM in CPT and CMS E/M Documentation Guidelines • Number of diagnoses or management options • Amount and/or complexity of data to be reviewed • Risk of significant complications, morbidity, and/or mortality • Presenting problem • Diagnostic procedures ordered • Management options selected

28. Common E/M Coding Errors Typical MDM Errors • No documentation of medical decision making at all • MDM limited to a list of old and current diagnoses • No indication that diagnoses/problems listed led to increased physician work • No key component information to support diagnostic conclusions and/or diagnostic/therapeutic plans

29. Medical Decision Making “Broad Brush” MDM • Typical E/M CPT code includes descriptions of multiple levels of key component work • For History and Physical, CMS Guidelines further describe and quantify CPT key component levels and descriptors • CMS Guidelines do not quantify MDM descriptors except in the area of “Risk”

30. Common E/M Coding Errors CPT and EM Guideline MDM Definitions • High complexity MDM • Extensive diagnoses evaluated or problems managed • Extensive amount and complexity diagnostic evaluation ordered or reviewed • High risk problem(s), diagnostic intervention(s), or treatment option(s)

31. Medical Decision Making MDM in CPT and CMS E/M Documentation Guidelines • 99222 • HX = Comprehensive • EX = Comprehensive • MDM = Moderate • Extensive HPI • Complete ROS • Complete PFSH

32. Medical Decision Making MDM in CPT and CMS E/M Documentation Guidelines • CPT • 99222 • MDM = Moderate • E/M Guidelines • Moderate MDM • Extensive numbers of diagnoses and/or management options (extensive notdefined) • Extensive data reviewed (extensive notdefined) • High risk of complications (table of risk provided)

33. Medical Decision Making No National Standard Method • Many physicians and other providers use no logical mechanism for coding MDM • Some use commercially and otherwise available score-sheets • Use without reasonability testing • Undefined terms included • Inherent shortcomings

34. MDM Rationale – Marshfield Clinic

35. Medical Decision Making • Uncomplicated rib fracture with chest x-ray and no treatment • Uncomplicated rib fracture with no imaging but treated with analgesic 3. Chronically uncontrolled diabetic with co-morbid conditions started on insulin therapy 4 points 3 points 1 point

36. MDM Auditing - TrailBlazer

37. MDM Auditing - TrailBlazer

38. MDM Auditing - TrailBlazer

39. MDM Rationale – TrailBlazer http://www.trailblazerhealth.com/partb/tx/evalmgmt.asp?

40. Medical Decision Making What’s a doc to do? Keep in mind what E/M coding is all about • Medical Necessity • Physician Work • Number and nature of problems • Diagnostic complexity • Therapeutic complexity

41. Medical Decision Making Diagnostic complexity • Differential diagnoses • Constellations of symptoms and signs • Appropriate H and P to support diagnostic conclusions • Appropriately complex diagnostic evaluation ordered, scheduled, or performed

42. Medical Decision Making Therapeutic complexity • Therapeutic modalities • Medications • Surgical procedures • Radiological interventions • Many, many others • Patient instruction • Referrals to other practitioners for treatment • Hospital admission

43. Medical Decision Making • Pick a method for coding MDM and apply it • Be consistent • Define quantitatively as many terms as possible • Validate that it does not lead to irrational coding considering physician work and medical necessity • If a method results in codes that it look too good to be true….they probably are

44. Consultations • All consultations require the following • Request for opinion or advice from another physician (for that physician to use in his or her care of the patient) • A written report of the consultant’s findings, opinions, and recommendations to the requesting physician • Documentation must demonstrate both the request and the report

45. Consultations • Opinion requested is specific to the patient’s condition • Referring physician will use the consultant’s report to manage the patient (ie, has not transferred sole care for the problem to the consultant) • Service performed by an appropriate practitioner adequately trained to provide the opinion requested • Adds to the quality or scope of medical care reasonably available from the requesting physician

46. Consultations • Pre-operative clearance must be medically reasonable and necessary considering the patient’s health history and the nature of the proposed operation • Pre-operative visits whose sole purpose is performing or recording the mandatory admission H/P for a surgical admission are not separately payable and are not consultations • Continuation of care by the consultant for an established clinical problem of an established patient in a different clinical setting but with no significant change in health status (ie, post-operative concurrent care) is not a consultation

47. Consultations • May not be reported as a split/shared service with a non-physician practitioner in the same group

48. Consultations • Orthopedist seeing patient with elbow pain at request of family practitioner • Internist seeing patient for hypertension at request of orthopedist • Cardiologist seeing patient for chest pain at request of neurosurgeon • Dermatologist seeing patient with melanoma at request of internist

49. Medicare Contracting Reform Why? Section 911 of the Medicare prescription Drug, Improvement, and Modernization Act of 2003 (MMA) • Replaces current contracting authority with the new Medicare Administrative Contracting (MAC) authority. • Requires CMS to compete and transition all work to MACs by October 2011

50. Medicare Contracting Reform • Carriers • Fiscal Intermediaries • Durable Medical Equipment Contractors