Medicare Provider Compliance Tips

Evaluation & Management Services

Affected Providers

Physicians and non-physician practitioners (NPPs) who bill for evaluation and management (E/M) services.

According to the 2023 Medicare Fee-for-Service Supplemental Improper Payment Data

Background

(https://www.cms.gov/files/document/2023medicarefee-servicesupplementalimproperpaymentdatapdf.pdf), the improper payment rate for all E/M codes is 10.7%, with a projected improper payment amount of $3.7 billion.

Denial Reasons

For the 2023 reporting period, insufficient documentation accounted for 34% of improper payments for overall E/M codes, while no documentation (7.5%), incorrect coding (52.4%), and “other” errors ( #OtherErrors) (6.1%) caused other improper payments.

Preventing Denials

Medical Record Documentation

For E/M services, the nature and amount of physician work and documentation varies by type of service, place of service, and the patient’s status.

The medical record documentation requirements listed below apply to all types of medical and surgical services in all settings, and you may change them to account for variable circumstances in providing E/M services:

  •  Make sure the patient’s medical record is complete and legible
  • Document each patient encounter with:
    •  The reason for their encounter and relevant history
    • Physical exam findings and earlier diagnostic test results  
    • An assessment, a clinical impression, or a diagnosis
    •  The rationale for ordering diagnostic and other ancillary services
    • A plan for care
    • The date of service and legible identity of the observer
  • Make the patient’s past and present diagnoses accessible to the treating or consulting physician
  • Find the right health risk factors
  • Document the patient’s progress and response to any changes in treatment and document the patient’s updated diagnosis
  • Make sure the documentation in the patient’s medical record supports the CPT and ICD-10-CM codes reported on the claim form or billing statement

For specifics of the listed documentation principles for E/M Services, see the 2023 Documentation Guidelines (https://www.ama-assn.org/system/files/2023-e-m-descriptors-guidelines.pdf).

Coding

Using CPT Codes

  •  A service’s medical necessity is the main criterion for payment besides the individual requirements of a CPT code
  • It’s not medically necessary or right to bill a higher level of E/M service when it warrants a lower level of service
  • The amount of documentation shouldn’t be the primary influence on how you bill a specific level of service, and documentation should support the level of service reported
  • Document the service during the visit or soon after it’s provided to keep a correct medical record

Selecting the E/M Service Level

As of January 1, 2023, providers for most E/M visit types determine the visit level based on either the level of medical decision-making (MDM) or the amount of time spent by the physician or NPP. For certain visits, like emergency department visits and critical care, providers must use either MDM or time for billing according to their CPT codes; they don’t have the option to choose between the 2. The CPT E/M Guidelines for MDM apply. For all E/M visits, a history and physical exam must be performed according to the code descriptors; however, the history and exam no longer affect the selection of the visit level. When using practitioner time to determine the visit level, the full time must be documented; the general CPT rule regarding the midpoint for certain timed services doesn’t apply in this case.

Medical necessity is the primary criterion for payment, in addition to the specific requirements for each E/M visit code. It’s not medically necessary or appropriate to bill for a higher level of E/M service when a lower level is warranted. The volume of documentation shouldn’t be the main factor in determining the billing level. Instead, the documentation should support the level of service being reported.

Any physician or NPP authorized to bill Medicare services will get payment from the Medicare Administrative Contractor (MAC) at the appropriate physician fee schedule amount based on the rendering NPI number.

 
 

NOTE:

We apply the “incident to” (https://www.cms.gov/regulations-and- guidance/guidance/manuals/downloads/bp102c15.pdf#page=63) Medicare Part B payment policy for office visits when you meet the requirements.

Split or Shared E/M Service

  •  A split (or shared) visit is an E/M visit in the facility setting that’s done by both a physician and an NPP who are in the same group, according to applicable law and regulations where the service could be billed by either the physician or NPP if provided independently by only 1 of them
  •  We pay the practitioner who does the substantive portion (https://www.cms.gov/files/document/r12604cp.pdf) of the visit

Other E/M Visits

E/M coding (https://www.cms.gov/files/document/mm12982-medicare-physician-fee-schedule-final-rule-summary-cy-2023.pdf) includes:

  •  Other E/M visits include hospital inpatient, hospital observation, emergency department, nursing facility, home services, residence services, and cognitive impairment assessment visits. We revised CPT codes for other E/M visits (except prolonged services), to include:
    •  Merger of hospital inpatient and observation visits into a single code set and merger of domiciliary, rest home (for example, boarding home), or custodial care and home visits into a single code set
    • Choice of medical decision making or time to select visit level (except visits that aren’t timed, like emergency department visits)
    • End use of history and exam to decide visit level (instead, there’s a requirement for a proper medical history or exam or both)
    • New descriptor times (where relevant)
    • Revised CPT E/M guidelines for levels of medical decision making
  •  We completed Medicare-specific coding for prolonged Other E/M services and created 3 new G codes (1 per E/M family):
    • G0316 for reporting prolonged hospital inpatient or observation services  
    • G0317 for prolonged nursing facility services
    • G0318 for prolonged home or residence services
  •  Report prolonged cognitive impairment assessment services using G2212, the Medicare-specific code for prolonged office or outpatient services, instead of CPT codes.

Starting in 2024, for prolonged visits, the substantive portion is more than half the practitioners’ total time. Prolonged services are only billed when time is used to select the visit level, so, determination of who provided the substantive portion is based on time.

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