Coding

Insurers Target Modifier -25

Modifier -25 allows reporting of both a minor procedure (ie, one with a 0- or 10-day global period) and a separate and distinct evaluation and management (E/M) service on the same date of service.¹ Because of the multicomplaint nature of dermatology, the ability to report a same-day procedure and an E/M service is critical for efficient, cost-effective, and patient-centered dermatologic care. However, it is well known that the use of modifier -25 has been under notable insurer scrutiny and is a common reason for medical record audits.^2,3 Some insurers have responded to increased utilization of modifier -25 by cutting reimbursement for claims that include both a procedure and an E/M service or by denying one of the services altogether.^4-6 The Centers for Medicare and Medicaid Services also have expressed concern about this coding combination with proposed cuts to reimbursement.⁷ Moreover, the Office of Inspector General has announced a work plan to investigate the frequent utilization of E/M codes and minor procedures by dermatologists.⁸ Clearly, modifier -25 is a continued target by insurers and regulators; therefore, dermatologists will want to make sure their coding and documentation meet all requirements and are updated for the new E/M codes for 2021.

The American Medical Association’s Current Procedural Terminology indicates that modifier -25 allows reporting of a “significant, separately identifiable evaluation and management service by the same physician or other qualified health care professional on the same day of a procedure or other service.”¹ Given that dermatology patients typically present with multiple concerns, dermatologists commonly evaluate and treat numerous conditions during one visit. Understanding what constitutes a separately identifiable E/M service is critical to bill accurately and to pass insurer audits.

Global Surgical Package

To appropriately bill both a procedure and an E/M service, the physician must indicate that the patient’s condition required an E/M service above and beyond the usual work of the procedure. The compilation of evaluation and work included in the payment for a procedure is called the global surgical package.⁹ In general, the global surgical package includes local or topical anesthesia; the surgical service/procedure itself; immediate postoperative care, including dictating the operative note; meeting/discussing the patient’s procedure with family and other physicians; and writing orders for the patient. For minor procedures (ie, those with either 0- or 10-day global periods), the surgical package also includes same-day E/M services associated with the decision to perform surgery. An appropriate history and physical examination as well as a discussion of the differential diagnosis, treatment options, and risk and benefits of treatment are all included in the payment of a minor procedure itself. Therefore, an evaluation to discuss a patient’s condition or change in condition, alternatives to treatment, or next steps after a diagnosis related to a treatment or diagnostic procedure should not be separately reported. Moreover, the fact that the patient is new to the physician is not in itself sufficient to allow reporting of an E/M service with these minor procedures. For major procedures (ie, those with 90-day postoperative periods), the decision for surgery is excluded from the global surgical package.

2021 E/M Codes Simplify Documentation

The biggest coding change of 2021 was the new E/M codes.¹⁰ Prior to this year, the descriptors of E/M services recognized 7 components to define the levels of E/M services¹¹: history and nature of the presenting problem; physical examination; medical decision-making (MDM); counseling; coordination of care; and time. Furthermore, history, physical examination, and MDM were all broken down into more granular elements that were summed to determine the level for each component; for example, the history of the presenting problem was defined as a chronological description of the development of the patient’s present illness, including the following elements: location, quality, severity, duration, timing, context, modifying factors, and associated signs and symptoms. Each of these categories would constitute bullet points to be summed to determine the level of history. Physical examination and MDM bullet points also would be summed to determine a proper coding level.¹¹ Understandably, this coding scheme was complicated and burdensome to medical providers.

The redefinition of the E/M codes for 2021 substantially simplified the determination of coding level and documentation.¹⁰ The revisions to the E/M office visit code descriptors and documentation standards are now centered around how physicians think and take care of patients and not on mandatory standards and checking boxes. The main changes involve MDM as the prime determinant of the coding level. Elements of MDM affecting coding for an outpatient or office visit now include only 3 components: the number and complexity of problems addressed in the encounter, the amount or complexity of data to be reviewed and analyzed, and the risk of complications or morbidity of patient management. Gone are the requirements from the earlier criteria requiring so many bullet points for the history, physical examination, and MDM.

Dermatologists may ask, “How does the new E/M coding structure affect reporting and documenting an E/M and a procedure on the same day?” The answer is that the determination of separate and distinct is basically unchanged with the new E/M codes; however, the documentation requirements for modifier -25 using the new E/M codes are simplified.

As always, the key to determining whether a separate and distinct E/M service was provided and subsequently documented is to deconstruct the medical note. All evaluation services associated with the procedure—making a clinical diagnosis or differential diagnosis, decision to perform surgery, and discussion of alternative treatments—should be removed from one’s documentation as shown in the example below. If a complete E/M service still exists, then an E/M may be billed in addition to the procedure. Physical examination of the treatment area is included in the surgical package. With the prior E/M criteria, physical examination of the procedural area could not be used again as a bullet point to count for the E/M level. However, with the new 2021 coding requirements, the documentation of a separate MDM will be sufficient to meet criteria because documentation of physical examination is not a requirement.

Modifier -25 Examples

Let’s examine a typical dermatologist medical note. An established patient presents to the dermatologist complaining of an itchy rash on the left wrist after a hiking trip. Treatment with topical hydrocortisone 1% did not help. The patient also complains of a growing tender lesion on the left elbow of 2 months’ duration. Physical examination reveals a linear vesicular eruption on the left wrist and a tender hyperkeratotic papule on the left elbow. No data is evaluated. A diagnosis of acute rhus dermatitis of the left wrist is made, and betamethasone cream is prescribed. The decision is made to perform a tangential biopsy of the lesion on the left elbow because of the suspicion for malignancy. The biopsy is performed the same day.

This case clearly illustrates performance of an E/M service in the treatment of rhus dermatitis, which is separate and distinct from the biopsy procedure; however, in evaluating whether the case meets the documentation requirements for modifier -25, the information in the medical note inclusive to the procedure’s global surgical package, including history associated with establishing the diagnosis, physical examination of the procedure area(s), and discussion of treatment options, is eliminated, leaving the following notes: An established patient presents to the dermatologist complaining of an itchy rash on the left wrist after a hiking trip. Treatment with topical hydrocortisone 1% did not help. No data is evaluated. A diagnosis of acute rhus dermatitis of the left wrist is made, and betamethasone cream is prescribed.

Because the physical examination of the body part (left arm) is included in the procedure’s global surgical package, the examination of the left wrist cannot be used as coding support for the E/M service. This makes a difference for coding level in the prior E/M coding requirements, which required examination bullet points. However, with the 2021 E/M codes, documentation of physical examination bullet points is irrelevant to the coding level. Therefore, qualifying for a modifier -25 claim is more straightforward in this case with the new code set. Because bullet points are not integral to the 2021 E/M codes, qualifying and properly documenting for a higher level of service will likely be more common in dermatology.

Final Thoughts

Frequent use of modifier -25 is a critical part of a high-quality and cost-effective dermatology practice. Same-day performance of minor procedures and E/M services allows for more rapid and efficient diagnosis and treatment of various conditions as well as minimizing unnecessary office visits. The new E/M codes for 2021 actually make the documentation of a separate and distinct E/M service less complicated because the bullet point requirements associated with the old E/M codes have been eliminated. Understanding how the new E/M code descriptors affect modifier -25 reporting and clear documentation of separate, distinct, and medically necessary E/M services will be needed due to increased insurer scrutiny and audits.

Insurers Target Modifier -25

Modifier -25 allows reporting of both a minor procedure (ie, one with a 0- or 10-day global period) and a separate and distinct evaluation and management (E/M) service on the same date of service.¹ Because of the multicomplaint nature of dermatology, the ability to report a same-day procedure and an E/M service is critical for efficient, cost-effective, and patient-centered dermatologic care. However, it is well known that the use of modifier -25 has been under notable insurer scrutiny and is a common reason for medical record audits.^2,3 Some insurers have responded to increased utilization of modifier -25 by cutting reimbursement for claims that include both a procedure and an E/M service or by denying one of the services altogether.^4-6 The Centers for Medicare and Medicaid Services also have expressed concern about this coding combination with proposed cuts to reimbursement.⁷ Moreover, the Office of Inspector General has announced a work plan to investigate the frequent utilization of E/M codes and minor procedures by dermatologists.⁸ Clearly, modifier -25 is a continued target by insurers and regulators; therefore, dermatologists will want to make sure their coding and documentation meet all requirements and are updated for the new E/M codes for 2021.

The American Medical Association’s Current Procedural Terminology indicates that modifier -25 allows reporting of a “significant, separately identifiable evaluation and management service by the same physician or other qualified health care professional on the same day of a procedure or other service.”¹ Given that dermatology patients typically present with multiple concerns, dermatologists commonly evaluate and treat numerous conditions during one visit. Understanding what constitutes a separately identifiable E/M service is critical to bill accurately and to pass insurer audits.

Global Surgical Package

To appropriately bill both a procedure and an E/M service, the physician must indicate that the patient’s condition required an E/M service above and beyond the usual work of the procedure. The compilation of evaluation and work included in the payment for a procedure is called the global surgical package.⁹ In general, the global surgical package includes local or topical anesthesia; the surgical service/procedure itself; immediate postoperative care, including dictating the operative note; meeting/discussing the patient’s procedure with family and other physicians; and writing orders for the patient. For minor procedures (ie, those with either 0- or 10-day global periods), the surgical package also includes same-day E/M services associated with the decision to perform surgery. An appropriate history and physical examination as well as a discussion of the differential diagnosis, treatment options, and risk and benefits of treatment are all included in the payment of a minor procedure itself. Therefore, an evaluation to discuss a patient’s condition or change in condition, alternatives to treatment, or next steps after a diagnosis related to a treatment or diagnostic procedure should not be separately reported. Moreover, the fact that the patient is new to the physician is not in itself sufficient to allow reporting of an E/M service with these minor procedures. For major procedures (ie, those with 90-day postoperative periods), the decision for surgery is excluded from the global surgical package.

2021 E/M Codes Simplify Documentation

The biggest coding change of 2021 was the new E/M codes.¹⁰ Prior to this year, the descriptors of E/M services recognized 7 components to define the levels of E/M services¹¹: history and nature of the presenting problem; physical examination; medical decision-making (MDM); counseling; coordination of care; and time. Furthermore, history, physical examination, and MDM were all broken down into more granular elements that were summed to determine the level for each component; for example, the history of the presenting problem was defined as a chronological description of the development of the patient’s present illness, including the following elements: location, quality, severity, duration, timing, context, modifying factors, and associated signs and symptoms. Each of these categories would constitute bullet points to be summed to determine the level of history. Physical examination and MDM bullet points also would be summed to determine a proper coding level.¹¹ Understandably, this coding scheme was complicated and burdensome to medical providers.

The redefinition of the E/M codes for 2021 substantially simplified the determination of coding level and documentation.¹⁰ The revisions to the E/M office visit code descriptors and documentation standards are now centered around how physicians think and take care of patients and not on mandatory standards and checking boxes. The main changes involve MDM as the prime determinant of the coding level. Elements of MDM affecting coding for an outpatient or office visit now include only 3 components: the number and complexity of problems addressed in the encounter, the amount or complexity of data to be reviewed and analyzed, and the risk of complications or morbidity of patient management. Gone are the requirements from the earlier criteria requiring so many bullet points for the history, physical examination, and MDM.

Dermatologists may ask, “How does the new E/M coding structure affect reporting and documenting an E/M and a procedure on the same day?” The answer is that the determination of separate and distinct is basically unchanged with the new E/M codes; however, the documentation requirements for modifier -25 using the new E/M codes are simplified.

As always, the key to determining whether a separate and distinct E/M service was provided and subsequently documented is to deconstruct the medical note. All evaluation services associated with the procedure—making a clinical diagnosis or differential diagnosis, decision to perform surgery, and discussion of alternative treatments—should be removed from one’s documentation as shown in the example below. If a complete E/M service still exists, then an E/M may be billed in addition to the procedure. Physical examination of the treatment area is included in the surgical package. With the prior E/M criteria, physical examination of the procedural area could not be used again as a bullet point to count for the E/M level. However, with the new 2021 coding requirements, the documentation of a separate MDM will be sufficient to meet criteria because documentation of physical examination is not a requirement.

Modifier -25 Examples

Let’s examine a typical dermatologist medical note. An established patient presents to the dermatologist complaining of an itchy rash on the left wrist after a hiking trip. Treatment with topical hydrocortisone 1% did not help. The patient also complains of a growing tender lesion on the left elbow of 2 months’ duration. Physical examination reveals a linear vesicular eruption on the left wrist and a tender hyperkeratotic papule on the left elbow. No data is evaluated. A diagnosis of acute rhus dermatitis of the left wrist is made, and betamethasone cream is prescribed. The decision is made to perform a tangential biopsy of the lesion on the left elbow because of the suspicion for malignancy. The biopsy is performed the same day.

This case clearly illustrates performance of an E/M service in the treatment of rhus dermatitis, which is separate and distinct from the biopsy procedure; however, in evaluating whether the case meets the documentation requirements for modifier -25, the information in the medical note inclusive to the procedure’s global surgical package, including history associated with establishing the diagnosis, physical examination of the procedure area(s), and discussion of treatment options, is eliminated, leaving the following notes: An established patient presents to the dermatologist complaining of an itchy rash on the left wrist after a hiking trip. Treatment with topical hydrocortisone 1% did not help. No data is evaluated. A diagnosis of acute rhus dermatitis of the left wrist is made, and betamethasone cream is prescribed.

Because the physical examination of the body part (left arm) is included in the procedure’s global surgical package, the examination of the left wrist cannot be used as coding support for the E/M service. This makes a difference for coding level in the prior E/M coding requirements, which required examination bullet points. However, with the 2021 E/M codes, documentation of physical examination bullet points is irrelevant to the coding level. Therefore, qualifying for a modifier -25 claim is more straightforward in this case with the new code set. Because bullet points are not integral to the 2021 E/M codes, qualifying and properly documenting for a higher level of service will likely be more common in dermatology.

Final Thoughts

Frequent use of modifier -25 is a critical part of a high-quality and cost-effective dermatology practice. Same-day performance of minor procedures and E/M services allows for more rapid and efficient diagnosis and treatment of various conditions as well as minimizing unnecessary office visits. The new E/M codes for 2021 actually make the documentation of a separate and distinct E/M service less complicated because the bullet point requirements associated with the old E/M codes have been eliminated. Understanding how the new E/M code descriptors affect modifier -25 reporting and clear documentation of separate, distinct, and medically necessary E/M services will be needed due to increased insurer scrutiny and audits.

Insurers Target Modifier -25

Modifier -25 allows reporting of both a minor procedure (ie, one with a 0- or 10-day global period) and a separate and distinct evaluation and management (E/M) service on the same date of service.¹ Because of the multicomplaint nature of dermatology, the ability to report a same-day procedure and an E/M service is critical for efficient, cost-effective, and patient-centered dermatologic care. However, it is well known that the use of modifier -25 has been under notable insurer scrutiny and is a common reason for medical record audits.^2,3 Some insurers have responded to increased utilization of modifier -25 by cutting reimbursement for claims that include both a procedure and an E/M service or by denying one of the services altogether.^4-6 The Centers for Medicare and Medicaid Services also have expressed concern about this coding combination with proposed cuts to reimbursement.⁷ Moreover, the Office of Inspector General has announced a work plan to investigate the frequent utilization of E/M codes and minor procedures by dermatologists.⁸ Clearly, modifier -25 is a continued target by insurers and regulators; therefore, dermatologists will want to make sure their coding and documentation meet all requirements and are updated for the new E/M codes for 2021.

The American Medical Association’s Current Procedural Terminology indicates that modifier -25 allows reporting of a “significant, separately identifiable evaluation and management service by the same physician or other qualified health care professional on the same day of a procedure or other service.”¹ Given that dermatology patients typically present with multiple concerns, dermatologists commonly evaluate and treat numerous conditions during one visit. Understanding what constitutes a separately identifiable E/M service is critical to bill accurately and to pass insurer audits.

Global Surgical Package

To appropriately bill both a procedure and an E/M service, the physician must indicate that the patient’s condition required an E/M service above and beyond the usual work of the procedure. The compilation of evaluation and work included in the payment for a procedure is called the global surgical package.⁹ In general, the global surgical package includes local or topical anesthesia; the surgical service/procedure itself; immediate postoperative care, including dictating the operative note; meeting/discussing the patient’s procedure with family and other physicians; and writing orders for the patient. For minor procedures (ie, those with either 0- or 10-day global periods), the surgical package also includes same-day E/M services associated with the decision to perform surgery. An appropriate history and physical examination as well as a discussion of the differential diagnosis, treatment options, and risk and benefits of treatment are all included in the payment of a minor procedure itself. Therefore, an evaluation to discuss a patient’s condition or change in condition, alternatives to treatment, or next steps after a diagnosis related to a treatment or diagnostic procedure should not be separately reported. Moreover, the fact that the patient is new to the physician is not in itself sufficient to allow reporting of an E/M service with these minor procedures. For major procedures (ie, those with 90-day postoperative periods), the decision for surgery is excluded from the global surgical package.

2021 E/M Codes Simplify Documentation

The biggest coding change of 2021 was the new E/M codes.¹⁰ Prior to this year, the descriptors of E/M services recognized 7 components to define the levels of E/M services¹¹: history and nature of the presenting problem; physical examination; medical decision-making (MDM); counseling; coordination of care; and time. Furthermore, history, physical examination, and MDM were all broken down into more granular elements that were summed to determine the level for each component; for example, the history of the presenting problem was defined as a chronological description of the development of the patient’s present illness, including the following elements: location, quality, severity, duration, timing, context, modifying factors, and associated signs and symptoms. Each of these categories would constitute bullet points to be summed to determine the level of history. Physical examination and MDM bullet points also would be summed to determine a proper coding level.¹¹ Understandably, this coding scheme was complicated and burdensome to medical providers.

The redefinition of the E/M codes for 2021 substantially simplified the determination of coding level and documentation.¹⁰ The revisions to the E/M office visit code descriptors and documentation standards are now centered around how physicians think and take care of patients and not on mandatory standards and checking boxes. The main changes involve MDM as the prime determinant of the coding level. Elements of MDM affecting coding for an outpatient or office visit now include only 3 components: the number and complexity of problems addressed in the encounter, the amount or complexity of data to be reviewed and analyzed, and the risk of complications or morbidity of patient management. Gone are the requirements from the earlier criteria requiring so many bullet points for the history, physical examination, and MDM.

Dermatologists may ask, “How does the new E/M coding structure affect reporting and documenting an E/M and a procedure on the same day?” The answer is that the determination of separate and distinct is basically unchanged with the new E/M codes; however, the documentation requirements for modifier -25 using the new E/M codes are simplified.

As always, the key to determining whether a separate and distinct E/M service was provided and subsequently documented is to deconstruct the medical note. All evaluation services associated with the procedure—making a clinical diagnosis or differential diagnosis, decision to perform surgery, and discussion of alternative treatments—should be removed from one’s documentation as shown in the example below. If a complete E/M service still exists, then an E/M may be billed in addition to the procedure. Physical examination of the treatment area is included in the surgical package. With the prior E/M criteria, physical examination of the procedural area could not be used again as a bullet point to count for the E/M level. However, with the new 2021 coding requirements, the documentation of a separate MDM will be sufficient to meet criteria because documentation of physical examination is not a requirement.

Modifier -25 Examples

Let’s examine a typical dermatologist medical note. An established patient presents to the dermatologist complaining of an itchy rash on the left wrist after a hiking trip. Treatment with topical hydrocortisone 1% did not help. The patient also complains of a growing tender lesion on the left elbow of 2 months’ duration. Physical examination reveals a linear vesicular eruption on the left wrist and a tender hyperkeratotic papule on the left elbow. No data is evaluated. A diagnosis of acute rhus dermatitis of the left wrist is made, and betamethasone cream is prescribed. The decision is made to perform a tangential biopsy of the lesion on the left elbow because of the suspicion for malignancy. The biopsy is performed the same day.

This case clearly illustrates performance of an E/M service in the treatment of rhus dermatitis, which is separate and distinct from the biopsy procedure; however, in evaluating whether the case meets the documentation requirements for modifier -25, the information in the medical note inclusive to the procedure’s global surgical package, including history associated with establishing the diagnosis, physical examination of the procedure area(s), and discussion of treatment options, is eliminated, leaving the following notes: An established patient presents to the dermatologist complaining of an itchy rash on the left wrist after a hiking trip. Treatment with topical hydrocortisone 1% did not help. No data is evaluated. A diagnosis of acute rhus dermatitis of the left wrist is made, and betamethasone cream is prescribed.

Because the physical examination of the body part (left arm) is included in the procedure’s global surgical package, the examination of the left wrist cannot be used as coding support for the E/M service. This makes a difference for coding level in the prior E/M coding requirements, which required examination bullet points. However, with the 2021 E/M codes, documentation of physical examination bullet points is irrelevant to the coding level. Therefore, qualifying for a modifier -25 claim is more straightforward in this case with the new code set. Because bullet points are not integral to the 2021 E/M codes, qualifying and properly documenting for a higher level of service will likely be more common in dermatology.

Final Thoughts

Frequent use of modifier -25 is a critical part of a high-quality and cost-effective dermatology practice. Same-day performance of minor procedures and E/M services allows for more rapid and efficient diagnosis and treatment of various conditions as well as minimizing unnecessary office visits. The new E/M codes for 2021 actually make the documentation of a separate and distinct E/M service less complicated because the bullet point requirements associated with the old E/M codes have been eliminated. Understanding how the new E/M code descriptors affect modifier -25 reporting and clear documentation of separate, distinct, and medically necessary E/M services will be needed due to increased insurer scrutiny and audits.

Effective on January 1, 2021, the outpatient evaluation and management (E/M) codes underwent substantial changes, which were the culmination of multiple years of revision and surveying via the American Medical Association (AMA) Relative Value Scale Update Committee and Current Procedural Terminology (RUC-CPT) process to streamline definitions and promote consistency as well as to decrease the administrative burden for all specialties within the house of medicine.¹ These updates represent a notable change from the previous documentation requirements for this oft used family of codes. Herein, we break down some of the highlights of the changes and how they may be applied for some commonly used dermatologic diagnoses.

Time Is Time Is Time

Prior to the 2021 revisions, a physician generally could only code for an E/M level by time for a face-to-face encounter dominated by counseling and/or care coordination. With the new updates, any encounter can be coded by total time spent by the physician with the patient¹; however, clinical staff time is not included. There also are now clear guidelines of the time ranges corresponding to the level of E/M,¹ as noted in Table 1.

Importantly, time now includes not just face-to-face time with the patient but also any time on the date of the encounter that the physician is involved in the care of the patient when not reported with a separate code. This can include reviewing notes or data before or after the examination, care coordination, ordering laboratory tests, and providing any documentation related to the encounter. Importantly, this applies only when these activities are done on the date of the encounter.

If you work with a nurse practitioner or physician assistant (PA) who assists you and you are the one reporting the service, you cannot double-dip. For example, if your PA spends 10 minutes alone with a patient, you are in the room together for 5 minutes, the PA spends another 10 minutes alone with the patient afterward, and you do chart work for 10 minutes at the end of the day, the total time spent is 35 minutes, not 40 minutes, as you cannot count the time you and the PA spent together twice.

Decisions, Decisions

Evaluation and management coding also can be determined via the level of medical decision-making (MDM). Per the 2021 guidelines, MDM is comprised of 3 categories: (1) number and complexity of problems addressed at the encounter, (2) amount and/or complexity of data to be reviewed or analyzed, and (3) risk of complications and/or morbidity or mortality of patient management.¹ To reach a certain overall E/M level, 2 of 3 categories must be met or exceeded. Let’s dive into each of these in a little more detail.

Number and Complexity of Problems Addressed at the Encounter
First, it is important to understand the definition of a problem addressed. Per AMA guidelines, this includes a disease, condition, illness, injury, symptom, sign, finding, complaint, or other matter addressed at the encounter that is evaluated or treated at the encounter by the physician. If the problem is referred to another provider without evaluation or consideration of treatment, it is not considered to be a problem addressed and cannot count toward this first category. An example could be a patient with a lump on the abdomen that you refer to plastic or general surgery for evaluation and treatment.

Once you have determined that you are addressing a problem, you will need to determine the level of complexity of the problem, as outlined in Table 2. Keep in mind that some entities and disease states in dermatology may fit the requirements of more than 1 level of complexity depending on the clinical situation, while there are many entities in dermatology that may not be perfectly captured by any of the levels described. In these situations, clinical judgement is required to determine where the problem would best fit. Importantly, whatever you decide, your documentation should support that decision.

Putting It All Together

Once you have determined each of the above 3 categories, you can put them together into the MDM chart to ascertain the overall level of MDM. (The official AMA medical decision-making grid is available online [https://www.ama-assn.org/system/files/2019-06/cpt-revised-mdm-grid.pdf]). Keep in mind that 2 of 3 columns in the table must be obtained in that level to reach an overall E/M level; for example, a visit that addresses 2 self-limited or minor problems (level 3) in which no data is reviewed (level 2) and involves prescribing a new medication (level 4), would be an overall level 3 visit.

Final Thoughts

The outpatient E/M guidelines have undergone substantial revisions; therefore, it is crucial to understand the updated definitions to ensure proper billing and documentation. History and physical examination documentation must be medically appropriate but are no longer used to determine overall E/M level; time and MDM are the sole options that can be used. Importantly, try to code as accurately as possible, documenting which problems were both noted and addressed. If you are unsure of a definition within the updated changes and MDM table, referencing the appropriate sources for guidance is recommended.

Although representing a considerable shift, the revaluation of this family of codes and the intended decrease in documentation burden has the ability to be a positive gain for dermatologists. Expect other code families to mirror these changes in the next few years.

Effective on January 1, 2021, the outpatient evaluation and management (E/M) codes underwent substantial changes, which were the culmination of multiple years of revision and surveying via the American Medical Association (AMA) Relative Value Scale Update Committee and Current Procedural Terminology (RUC-CPT) process to streamline definitions and promote consistency as well as to decrease the administrative burden for all specialties within the house of medicine.¹ These updates represent a notable change from the previous documentation requirements for this oft used family of codes. Herein, we break down some of the highlights of the changes and how they may be applied for some commonly used dermatologic diagnoses.

Time Is Time Is Time

Prior to the 2021 revisions, a physician generally could only code for an E/M level by time for a face-to-face encounter dominated by counseling and/or care coordination. With the new updates, any encounter can be coded by total time spent by the physician with the patient¹; however, clinical staff time is not included. There also are now clear guidelines of the time ranges corresponding to the level of E/M,¹ as noted in Table 1.

Importantly, time now includes not just face-to-face time with the patient but also any time on the date of the encounter that the physician is involved in the care of the patient when not reported with a separate code. This can include reviewing notes or data before or after the examination, care coordination, ordering laboratory tests, and providing any documentation related to the encounter. Importantly, this applies only when these activities are done on the date of the encounter.

If you work with a nurse practitioner or physician assistant (PA) who assists you and you are the one reporting the service, you cannot double-dip. For example, if your PA spends 10 minutes alone with a patient, you are in the room together for 5 minutes, the PA spends another 10 minutes alone with the patient afterward, and you do chart work for 10 minutes at the end of the day, the total time spent is 35 minutes, not 40 minutes, as you cannot count the time you and the PA spent together twice.

Decisions, Decisions

Evaluation and management coding also can be determined via the level of medical decision-making (MDM). Per the 2021 guidelines, MDM is comprised of 3 categories: (1) number and complexity of problems addressed at the encounter, (2) amount and/or complexity of data to be reviewed or analyzed, and (3) risk of complications and/or morbidity or mortality of patient management.¹ To reach a certain overall E/M level, 2 of 3 categories must be met or exceeded. Let’s dive into each of these in a little more detail.

Number and Complexity of Problems Addressed at the Encounter
First, it is important to understand the definition of a problem addressed. Per AMA guidelines, this includes a disease, condition, illness, injury, symptom, sign, finding, complaint, or other matter addressed at the encounter that is evaluated or treated at the encounter by the physician. If the problem is referred to another provider without evaluation or consideration of treatment, it is not considered to be a problem addressed and cannot count toward this first category. An example could be a patient with a lump on the abdomen that you refer to plastic or general surgery for evaluation and treatment.

Once you have determined that you are addressing a problem, you will need to determine the level of complexity of the problem, as outlined in Table 2. Keep in mind that some entities and disease states in dermatology may fit the requirements of more than 1 level of complexity depending on the clinical situation, while there are many entities in dermatology that may not be perfectly captured by any of the levels described. In these situations, clinical judgement is required to determine where the problem would best fit. Importantly, whatever you decide, your documentation should support that decision.

Putting It All Together

Once you have determined each of the above 3 categories, you can put them together into the MDM chart to ascertain the overall level of MDM. (The official AMA medical decision-making grid is available online [https://www.ama-assn.org/system/files/2019-06/cpt-revised-mdm-grid.pdf]). Keep in mind that 2 of 3 columns in the table must be obtained in that level to reach an overall E/M level; for example, a visit that addresses 2 self-limited or minor problems (level 3) in which no data is reviewed (level 2) and involves prescribing a new medication (level 4), would be an overall level 3 visit.

Final Thoughts

The outpatient E/M guidelines have undergone substantial revisions; therefore, it is crucial to understand the updated definitions to ensure proper billing and documentation. History and physical examination documentation must be medically appropriate but are no longer used to determine overall E/M level; time and MDM are the sole options that can be used. Importantly, try to code as accurately as possible, documenting which problems were both noted and addressed. If you are unsure of a definition within the updated changes and MDM table, referencing the appropriate sources for guidance is recommended.

Although representing a considerable shift, the revaluation of this family of codes and the intended decrease in documentation burden has the ability to be a positive gain for dermatologists. Expect other code families to mirror these changes in the next few years.

Effective on January 1, 2021, the outpatient evaluation and management (E/M) codes underwent substantial changes, which were the culmination of multiple years of revision and surveying via the American Medical Association (AMA) Relative Value Scale Update Committee and Current Procedural Terminology (RUC-CPT) process to streamline definitions and promote consistency as well as to decrease the administrative burden for all specialties within the house of medicine.¹ These updates represent a notable change from the previous documentation requirements for this oft used family of codes. Herein, we break down some of the highlights of the changes and how they may be applied for some commonly used dermatologic diagnoses.

Time Is Time Is Time

Prior to the 2021 revisions, a physician generally could only code for an E/M level by time for a face-to-face encounter dominated by counseling and/or care coordination. With the new updates, any encounter can be coded by total time spent by the physician with the patient¹; however, clinical staff time is not included. There also are now clear guidelines of the time ranges corresponding to the level of E/M,¹ as noted in Table 1.

Importantly, time now includes not just face-to-face time with the patient but also any time on the date of the encounter that the physician is involved in the care of the patient when not reported with a separate code. This can include reviewing notes or data before or after the examination, care coordination, ordering laboratory tests, and providing any documentation related to the encounter. Importantly, this applies only when these activities are done on the date of the encounter.

If you work with a nurse practitioner or physician assistant (PA) who assists you and you are the one reporting the service, you cannot double-dip. For example, if your PA spends 10 minutes alone with a patient, you are in the room together for 5 minutes, the PA spends another 10 minutes alone with the patient afterward, and you do chart work for 10 minutes at the end of the day, the total time spent is 35 minutes, not 40 minutes, as you cannot count the time you and the PA spent together twice.

Decisions, Decisions

Evaluation and management coding also can be determined via the level of medical decision-making (MDM). Per the 2021 guidelines, MDM is comprised of 3 categories: (1) number and complexity of problems addressed at the encounter, (2) amount and/or complexity of data to be reviewed or analyzed, and (3) risk of complications and/or morbidity or mortality of patient management.¹ To reach a certain overall E/M level, 2 of 3 categories must be met or exceeded. Let’s dive into each of these in a little more detail.

Number and Complexity of Problems Addressed at the Encounter
First, it is important to understand the definition of a problem addressed. Per AMA guidelines, this includes a disease, condition, illness, injury, symptom, sign, finding, complaint, or other matter addressed at the encounter that is evaluated or treated at the encounter by the physician. If the problem is referred to another provider without evaluation or consideration of treatment, it is not considered to be a problem addressed and cannot count toward this first category. An example could be a patient with a lump on the abdomen that you refer to plastic or general surgery for evaluation and treatment.

Once you have determined that you are addressing a problem, you will need to determine the level of complexity of the problem, as outlined in Table 2. Keep in mind that some entities and disease states in dermatology may fit the requirements of more than 1 level of complexity depending on the clinical situation, while there are many entities in dermatology that may not be perfectly captured by any of the levels described. In these situations, clinical judgement is required to determine where the problem would best fit. Importantly, whatever you decide, your documentation should support that decision.

Putting It All Together

Once you have determined each of the above 3 categories, you can put them together into the MDM chart to ascertain the overall level of MDM. (The official AMA medical decision-making grid is available online [https://www.ama-assn.org/system/files/2019-06/cpt-revised-mdm-grid.pdf]). Keep in mind that 2 of 3 columns in the table must be obtained in that level to reach an overall E/M level; for example, a visit that addresses 2 self-limited or minor problems (level 3) in which no data is reviewed (level 2) and involves prescribing a new medication (level 4), would be an overall level 3 visit.

Final Thoughts

The outpatient E/M guidelines have undergone substantial revisions; therefore, it is crucial to understand the updated definitions to ensure proper billing and documentation. History and physical examination documentation must be medically appropriate but are no longer used to determine overall E/M level; time and MDM are the sole options that can be used. Importantly, try to code as accurately as possible, documenting which problems were both noted and addressed. If you are unsure of a definition within the updated changes and MDM table, referencing the appropriate sources for guidance is recommended.

Although representing a considerable shift, the revaluation of this family of codes and the intended decrease in documentation burden has the ability to be a positive gain for dermatologists. Expect other code families to mirror these changes in the next few years.

I have written previously about Current Procedural Terminology (CPT) procedure codes submitted on the same date of service as evaluation and management (E/M) services in the context of modifier -25.¹ Billing same-day procedures and E/M services is under close scrutiny by insurers, and accurate and complete documentation is a must.² An understanding of what aspects of evaluation are included in the global surgical package is critical in deciding whether a separate and distinct same-day evaluation was performed. In general, the decision to perform a procedure is included in the payment for the procedure itself, as is the examination of the body site in question, diagnosis of the medical condition, discussion of treatment options, and postoperative services related to the procedure. This is true for CPT codes that contain physician work, which constitute the majority of CPT codes reported by dermatologists.³

However, there is one set of codes where these principles do not apply: the practice expense (PE)–only codes, or no physician work codes. These codes are defined by CPT and the Relative Value Scale Update Committee (RUC) of the American Medical Association as containing no physician work. Their valuations are based only on staff/nursing time and the other aspects of direct and indirect practice costs included in providing the service, such as gauze, sutures, equipment, office rent, and utilities.⁴ Examples of PE-only codes include the nonphysician-performed photodynamic therapy code 96567; phototherapy codes 96900, 96910, and 96912; and patch testing and photopatch testing codes 95044, 95052, and 95056.

For PE-only codes, only the provision of the service by staff is included in the code reimbursement; there is no physician time or work built into these codes. Thus, neither the initial evaluation of the patient by the physician, the decision to perform the procedure, nor the evaluation of therapy effectiveness or side effects or interpretation of the results is included. Understanding that there is no physician involvement in PE-only codes is critical in deciding whether an E/M service should be billed on the same day as a PE-only code. To that end, although a physician does not actually have to personally evaluate the patient on the day of service to bill PE-only codes, the Centers for Medicare & Medicaid Services has indicated that a physician or qualified medical provider must be on premises.⁵ Billing for PE-only services when no provider is present will be interpreted as a false claim or fraudulent billing practice.

Because PE-only codes do not include physician work, an E/M service will be billed in addition to the treatment almost any time a same-day physician evaluation is performed. For example, if a patient presents with a changing mole that is evaluated on the same date of service as phototherapy for the treatment of psoriasis, that service is clearly reportable with an E/M code because the mole check is separate and distinct from the phototherapy treatment. A more common scenario is for the physician to see a patient with a rash consistent with an allergic contact dermatitis and the decision to perform same-day patch testing is made. In this circumstance, the E/M service is still reportable because the evaluation of the rash and the decision to perform patch testing are not included in this PE-only code.

Phototherapy typically is provided as a prolonged course of multiple treatments, and reporting of same-day E/M services during the course of therapy is common. Phototherapy must be monitored by the physician for clinical effectiveness, dose changes, and side effects, as well as to determine whether to continue therapy. A standard operating procedure should be created to document that the physician typically evaluates the patient’s progress at set intervals or as dictated by patient or staff concerns. Reporting an E/M service with every phototherapy session is not considered medically necessary. Moreover, a nurse evaluation of the patient prior to each phototherapy treatment, including questions on disease severity, how the patient did with the last treatment, and whether medications have changed, is included in the payment for the phototherapy codes. Only formal and medically necessary physician E/M services should be billed, not drive-by visits in which the physician pops in just to see how the patient is doing.

Final Thoughts

Practice expense–only codes include no payment for physician time or work but require the presence of a qualified health care provider on premises to bill. Medically necessary physician evaluations on the same day as PE-only services will typically result in both an E/M service and the procedure being reported. Understanding performance and documentation requirements of PE-only codes is critical for proper reimbursement for a dermatology practice.

I have written previously about Current Procedural Terminology (CPT) procedure codes submitted on the same date of service as evaluation and management (E/M) services in the context of modifier -25.¹ Billing same-day procedures and E/M services is under close scrutiny by insurers, and accurate and complete documentation is a must.² An understanding of what aspects of evaluation are included in the global surgical package is critical in deciding whether a separate and distinct same-day evaluation was performed. In general, the decision to perform a procedure is included in the payment for the procedure itself, as is the examination of the body site in question, diagnosis of the medical condition, discussion of treatment options, and postoperative services related to the procedure. This is true for CPT codes that contain physician work, which constitute the majority of CPT codes reported by dermatologists.³

However, there is one set of codes where these principles do not apply: the practice expense (PE)–only codes, or no physician work codes. These codes are defined by CPT and the Relative Value Scale Update Committee (RUC) of the American Medical Association as containing no physician work. Their valuations are based only on staff/nursing time and the other aspects of direct and indirect practice costs included in providing the service, such as gauze, sutures, equipment, office rent, and utilities.⁴ Examples of PE-only codes include the nonphysician-performed photodynamic therapy code 96567; phototherapy codes 96900, 96910, and 96912; and patch testing and photopatch testing codes 95044, 95052, and 95056.

For PE-only codes, only the provision of the service by staff is included in the code reimbursement; there is no physician time or work built into these codes. Thus, neither the initial evaluation of the patient by the physician, the decision to perform the procedure, nor the evaluation of therapy effectiveness or side effects or interpretation of the results is included. Understanding that there is no physician involvement in PE-only codes is critical in deciding whether an E/M service should be billed on the same day as a PE-only code. To that end, although a physician does not actually have to personally evaluate the patient on the day of service to bill PE-only codes, the Centers for Medicare & Medicaid Services has indicated that a physician or qualified medical provider must be on premises.⁵ Billing for PE-only services when no provider is present will be interpreted as a false claim or fraudulent billing practice.

Because PE-only codes do not include physician work, an E/M service will be billed in addition to the treatment almost any time a same-day physician evaluation is performed. For example, if a patient presents with a changing mole that is evaluated on the same date of service as phototherapy for the treatment of psoriasis, that service is clearly reportable with an E/M code because the mole check is separate and distinct from the phototherapy treatment. A more common scenario is for the physician to see a patient with a rash consistent with an allergic contact dermatitis and the decision to perform same-day patch testing is made. In this circumstance, the E/M service is still reportable because the evaluation of the rash and the decision to perform patch testing are not included in this PE-only code.

Phototherapy typically is provided as a prolonged course of multiple treatments, and reporting of same-day E/M services during the course of therapy is common. Phototherapy must be monitored by the physician for clinical effectiveness, dose changes, and side effects, as well as to determine whether to continue therapy. A standard operating procedure should be created to document that the physician typically evaluates the patient’s progress at set intervals or as dictated by patient or staff concerns. Reporting an E/M service with every phototherapy session is not considered medically necessary. Moreover, a nurse evaluation of the patient prior to each phototherapy treatment, including questions on disease severity, how the patient did with the last treatment, and whether medications have changed, is included in the payment for the phototherapy codes. Only formal and medically necessary physician E/M services should be billed, not drive-by visits in which the physician pops in just to see how the patient is doing.

Final Thoughts

Practice expense–only codes include no payment for physician time or work but require the presence of a qualified health care provider on premises to bill. Medically necessary physician evaluations on the same day as PE-only services will typically result in both an E/M service and the procedure being reported. Understanding performance and documentation requirements of PE-only codes is critical for proper reimbursement for a dermatology practice.

I have written previously about Current Procedural Terminology (CPT) procedure codes submitted on the same date of service as evaluation and management (E/M) services in the context of modifier -25.¹ Billing same-day procedures and E/M services is under close scrutiny by insurers, and accurate and complete documentation is a must.² An understanding of what aspects of evaluation are included in the global surgical package is critical in deciding whether a separate and distinct same-day evaluation was performed. In general, the decision to perform a procedure is included in the payment for the procedure itself, as is the examination of the body site in question, diagnosis of the medical condition, discussion of treatment options, and postoperative services related to the procedure. This is true for CPT codes that contain physician work, which constitute the majority of CPT codes reported by dermatologists.³

However, there is one set of codes where these principles do not apply: the practice expense (PE)–only codes, or no physician work codes. These codes are defined by CPT and the Relative Value Scale Update Committee (RUC) of the American Medical Association as containing no physician work. Their valuations are based only on staff/nursing time and the other aspects of direct and indirect practice costs included in providing the service, such as gauze, sutures, equipment, office rent, and utilities.⁴ Examples of PE-only codes include the nonphysician-performed photodynamic therapy code 96567; phototherapy codes 96900, 96910, and 96912; and patch testing and photopatch testing codes 95044, 95052, and 95056.

For PE-only codes, only the provision of the service by staff is included in the code reimbursement; there is no physician time or work built into these codes. Thus, neither the initial evaluation of the patient by the physician, the decision to perform the procedure, nor the evaluation of therapy effectiveness or side effects or interpretation of the results is included. Understanding that there is no physician involvement in PE-only codes is critical in deciding whether an E/M service should be billed on the same day as a PE-only code. To that end, although a physician does not actually have to personally evaluate the patient on the day of service to bill PE-only codes, the Centers for Medicare & Medicaid Services has indicated that a physician or qualified medical provider must be on premises.⁵ Billing for PE-only services when no provider is present will be interpreted as a false claim or fraudulent billing practice.

Because PE-only codes do not include physician work, an E/M service will be billed in addition to the treatment almost any time a same-day physician evaluation is performed. For example, if a patient presents with a changing mole that is evaluated on the same date of service as phototherapy for the treatment of psoriasis, that service is clearly reportable with an E/M code because the mole check is separate and distinct from the phototherapy treatment. A more common scenario is for the physician to see a patient with a rash consistent with an allergic contact dermatitis and the decision to perform same-day patch testing is made. In this circumstance, the E/M service is still reportable because the evaluation of the rash and the decision to perform patch testing are not included in this PE-only code.

Phototherapy typically is provided as a prolonged course of multiple treatments, and reporting of same-day E/M services during the course of therapy is common. Phototherapy must be monitored by the physician for clinical effectiveness, dose changes, and side effects, as well as to determine whether to continue therapy. A standard operating procedure should be created to document that the physician typically evaluates the patient’s progress at set intervals or as dictated by patient or staff concerns. Reporting an E/M service with every phototherapy session is not considered medically necessary. Moreover, a nurse evaluation of the patient prior to each phototherapy treatment, including questions on disease severity, how the patient did with the last treatment, and whether medications have changed, is included in the payment for the phototherapy codes. Only formal and medically necessary physician E/M services should be billed, not drive-by visits in which the physician pops in just to see how the patient is doing.

Final Thoughts

Practice expense–only codes include no payment for physician time or work but require the presence of a qualified health care provider on premises to bill. Medically necessary physician evaluations on the same day as PE-only services will typically result in both an E/M service and the procedure being reported. Understanding performance and documentation requirements of PE-only codes is critical for proper reimbursement for a dermatology practice.

On February 23, 2018, Anthem Insurance Companies, Inc, announced the reversal of its proposed policy to reduce reimbursement for evaluation and management (E/M) services billed using modifier -25.¹ This win for physicians was the result of a broad-based, multipronged advocacy campaign, and the American Academy of Dermatology Association (AADA) was critical to this victory.

Dermatology Took the Lead in Opposing Policy That Would Reduce Reimbursement

Dermatology was the first to trumpet the dangers of modifier -25 reduction policies and explain why other specialty societies should care. The AADA took the lead in assembling a coalition of physician groups to oppose the proposed policy by sharing language for opposition letters and meeting talking points with many societies outside of dermatology as well as producing the first draft for the American Medical Association (AMA) House of Delegates’ resolution that spurred action against Anthem’s proposed policy.² Members of the AADA attended numerous conference calls and in-person meetings with health insurance officials to urge them to reverse the policy and helped coordinate opposition from state and national specialty societies. The influence and advocacy of the AMA was critical in reversing the proposed policy, but dermatology started the opposition and organized the players to bring the fight against Anthem.

AADA Continues to Fight

Despite the victory against Anthem, challenges to fair reimbursement of modifier -25 claims are ongoing. Two insurers recently announced implementation of new modifier -25 reduction policies.^3,4 Moreover, 4 other insurers have existing modifier -25 reduction policies in place.^5-8 The AADA has engaged, and will continue engaging, each of these insurers with the message that the ability to perform procedures and distinct E/M services on the same day is integral to efficient, patient-centered care of dermatologic diseases. The AADA argues that insurers’ rationale (overlapping indirect practice expenses) for payment reduction is improper and that appropriately documented modifier -25 claims should be reimbursed at 100% of allowable charges.

In addition to the existing insurer policies affecting modifier -25, Anthem has announced that it plans to conduct audits of modifier -25 claims with recoupments of inappropriate charges.¹ Some Medicare Administrative Contractors also have cited modifier -25 as an area of concern and issued guidelines for reporting modifier -25, which frequently precede audits.⁹ The AADA is concerned that if Anthem follows through with its aggressive audits to recoup money, which can result in substantial take-backs, and finds a high error rate in modifier -25 claims, it also may consider revisiting its reduction policy. Moreover, it is likely that other insurers will use failed modifier -25 audits as an excuse to continue, expand, or adopt modifier -25 reduction policies. It is clear that blanket reduction in payment is much easier and less expensive for insurers than auditing medical records and not paying those who abuse modifier -25. As long as insurers are under financial pressure, modifier -25 will be a tempting target for reducing health care costs.

How to Use Modifier -25 Correctly

In addition to opposing inappropriate reimbursement of modifier -25, the AADA is committed to educating its members and insurers on the correct use and documentation of modifier -25. In December 2017, Mollie A. MacCormack, MD (Nashua, New Hampshire), and I led an educational webinar on modifier -25 for more than 1100 attendees.¹⁰ We discussed the performance standards and documentation requirements of modifier -25. It was clear that dermatologists were interested not only in the correct coding of modifier -25 claims but also avoiding the consequences of audits.

My peers frequently ask, “What can we [dermatologists] do to prepare for potential modifier -25 audits?” My advice is always, “Physician audit thyself.” I recommend self-auditing to make sure you and your practice are in compliance with modifier -25 documentation requirements. In a March 2017 Cutis column on modifier -25, I discussed what constitutes separate and distinct E/M services and what is included in a procedure’s global surgical package.¹¹ A self-audit is as simple as pulling 10 to 20 medical records in which a same-day procedure and E/M service were billed. Cross out any information in the note included in the procedure’s global surgical package including history associated with establishing the diagnosis, physical examination of the procedure area(s), and discussion of treatment options. If complete documentation for an E/M is still present after removing the procedure and associated evaluation, you have passed the self-audit. If not, consider changing your coding to better reflect the documentation in your records. In my experience, insurance auditors are not physicians and often are not even medical professionals. Clear documentation and clear existence of a separate, distinct, and medically necessary E/M service is needed to succeed in a modifier -25 audit.

Final Thoughts

Dermatologists should rejoice that Anthem decided to rescind its modifier -25 policy. If this policy had gone into effect, the modifier -25 reduction would likely have spread to most other insurers as industry standard. This victory certainly shows what can be accomplished when organized medicine works together. Your state dermatology and medical societies, national societies, and the AMA collaborated on a critical existential threat to cost-effective and efficient patient care and won. These organizations deserve your membership and support as well as your thanks; however, our celebration must be short-lived, as there still are other insurers with modifier -25 reductions in place, and audits have been promised. We must continue to focus on proper use and documentation of modifier -25. This effort will not only help dermatologists decrease the risk of large recoupments from audits but also help the AADA continue to oppose inappropriate payment policies.

On February 23, 2018, Anthem Insurance Companies, Inc, announced the reversal of its proposed policy to reduce reimbursement for evaluation and management (E/M) services billed using modifier -25.¹ This win for physicians was the result of a broad-based, multipronged advocacy campaign, and the American Academy of Dermatology Association (AADA) was critical to this victory.

Dermatology Took the Lead in Opposing Policy That Would Reduce Reimbursement

Dermatology was the first to trumpet the dangers of modifier -25 reduction policies and explain why other specialty societies should care. The AADA took the lead in assembling a coalition of physician groups to oppose the proposed policy by sharing language for opposition letters and meeting talking points with many societies outside of dermatology as well as producing the first draft for the American Medical Association (AMA) House of Delegates’ resolution that spurred action against Anthem’s proposed policy.² Members of the AADA attended numerous conference calls and in-person meetings with health insurance officials to urge them to reverse the policy and helped coordinate opposition from state and national specialty societies. The influence and advocacy of the AMA was critical in reversing the proposed policy, but dermatology started the opposition and organized the players to bring the fight against Anthem.

AADA Continues to Fight

Despite the victory against Anthem, challenges to fair reimbursement of modifier -25 claims are ongoing. Two insurers recently announced implementation of new modifier -25 reduction policies.^3,4 Moreover, 4 other insurers have existing modifier -25 reduction policies in place.^5-8 The AADA has engaged, and will continue engaging, each of these insurers with the message that the ability to perform procedures and distinct E/M services on the same day is integral to efficient, patient-centered care of dermatologic diseases. The AADA argues that insurers’ rationale (overlapping indirect practice expenses) for payment reduction is improper and that appropriately documented modifier -25 claims should be reimbursed at 100% of allowable charges.

In addition to the existing insurer policies affecting modifier -25, Anthem has announced that it plans to conduct audits of modifier -25 claims with recoupments of inappropriate charges.¹ Some Medicare Administrative Contractors also have cited modifier -25 as an area of concern and issued guidelines for reporting modifier -25, which frequently precede audits.⁹ The AADA is concerned that if Anthem follows through with its aggressive audits to recoup money, which can result in substantial take-backs, and finds a high error rate in modifier -25 claims, it also may consider revisiting its reduction policy. Moreover, it is likely that other insurers will use failed modifier -25 audits as an excuse to continue, expand, or adopt modifier -25 reduction policies. It is clear that blanket reduction in payment is much easier and less expensive for insurers than auditing medical records and not paying those who abuse modifier -25. As long as insurers are under financial pressure, modifier -25 will be a tempting target for reducing health care costs.

How to Use Modifier -25 Correctly

In addition to opposing inappropriate reimbursement of modifier -25, the AADA is committed to educating its members and insurers on the correct use and documentation of modifier -25. In December 2017, Mollie A. MacCormack, MD (Nashua, New Hampshire), and I led an educational webinar on modifier -25 for more than 1100 attendees.¹⁰ We discussed the performance standards and documentation requirements of modifier -25. It was clear that dermatologists were interested not only in the correct coding of modifier -25 claims but also avoiding the consequences of audits.

My peers frequently ask, “What can we [dermatologists] do to prepare for potential modifier -25 audits?” My advice is always, “Physician audit thyself.” I recommend self-auditing to make sure you and your practice are in compliance with modifier -25 documentation requirements. In a March 2017 Cutis column on modifier -25, I discussed what constitutes separate and distinct E/M services and what is included in a procedure’s global surgical package.¹¹ A self-audit is as simple as pulling 10 to 20 medical records in which a same-day procedure and E/M service were billed. Cross out any information in the note included in the procedure’s global surgical package including history associated with establishing the diagnosis, physical examination of the procedure area(s), and discussion of treatment options. If complete documentation for an E/M is still present after removing the procedure and associated evaluation, you have passed the self-audit. If not, consider changing your coding to better reflect the documentation in your records. In my experience, insurance auditors are not physicians and often are not even medical professionals. Clear documentation and clear existence of a separate, distinct, and medically necessary E/M service is needed to succeed in a modifier -25 audit.

Final Thoughts

Dermatologists should rejoice that Anthem decided to rescind its modifier -25 policy. If this policy had gone into effect, the modifier -25 reduction would likely have spread to most other insurers as industry standard. This victory certainly shows what can be accomplished when organized medicine works together. Your state dermatology and medical societies, national societies, and the AMA collaborated on a critical existential threat to cost-effective and efficient patient care and won. These organizations deserve your membership and support as well as your thanks; however, our celebration must be short-lived, as there still are other insurers with modifier -25 reductions in place, and audits have been promised. We must continue to focus on proper use and documentation of modifier -25. This effort will not only help dermatologists decrease the risk of large recoupments from audits but also help the AADA continue to oppose inappropriate payment policies.

On February 23, 2018, Anthem Insurance Companies, Inc, announced the reversal of its proposed policy to reduce reimbursement for evaluation and management (E/M) services billed using modifier -25.¹ This win for physicians was the result of a broad-based, multipronged advocacy campaign, and the American Academy of Dermatology Association (AADA) was critical to this victory.

Dermatology Took the Lead in Opposing Policy That Would Reduce Reimbursement

Dermatology was the first to trumpet the dangers of modifier -25 reduction policies and explain why other specialty societies should care. The AADA took the lead in assembling a coalition of physician groups to oppose the proposed policy by sharing language for opposition letters and meeting talking points with many societies outside of dermatology as well as producing the first draft for the American Medical Association (AMA) House of Delegates’ resolution that spurred action against Anthem’s proposed policy.² Members of the AADA attended numerous conference calls and in-person meetings with health insurance officials to urge them to reverse the policy and helped coordinate opposition from state and national specialty societies. The influence and advocacy of the AMA was critical in reversing the proposed policy, but dermatology started the opposition and organized the players to bring the fight against Anthem.

AADA Continues to Fight

Despite the victory against Anthem, challenges to fair reimbursement of modifier -25 claims are ongoing. Two insurers recently announced implementation of new modifier -25 reduction policies.^3,4 Moreover, 4 other insurers have existing modifier -25 reduction policies in place.^5-8 The AADA has engaged, and will continue engaging, each of these insurers with the message that the ability to perform procedures and distinct E/M services on the same day is integral to efficient, patient-centered care of dermatologic diseases. The AADA argues that insurers’ rationale (overlapping indirect practice expenses) for payment reduction is improper and that appropriately documented modifier -25 claims should be reimbursed at 100% of allowable charges.

In addition to the existing insurer policies affecting modifier -25, Anthem has announced that it plans to conduct audits of modifier -25 claims with recoupments of inappropriate charges.¹ Some Medicare Administrative Contractors also have cited modifier -25 as an area of concern and issued guidelines for reporting modifier -25, which frequently precede audits.⁹ The AADA is concerned that if Anthem follows through with its aggressive audits to recoup money, which can result in substantial take-backs, and finds a high error rate in modifier -25 claims, it also may consider revisiting its reduction policy. Moreover, it is likely that other insurers will use failed modifier -25 audits as an excuse to continue, expand, or adopt modifier -25 reduction policies. It is clear that blanket reduction in payment is much easier and less expensive for insurers than auditing medical records and not paying those who abuse modifier -25. As long as insurers are under financial pressure, modifier -25 will be a tempting target for reducing health care costs.

How to Use Modifier -25 Correctly

In addition to opposing inappropriate reimbursement of modifier -25, the AADA is committed to educating its members and insurers on the correct use and documentation of modifier -25. In December 2017, Mollie A. MacCormack, MD (Nashua, New Hampshire), and I led an educational webinar on modifier -25 for more than 1100 attendees.¹⁰ We discussed the performance standards and documentation requirements of modifier -25. It was clear that dermatologists were interested not only in the correct coding of modifier -25 claims but also avoiding the consequences of audits.

My peers frequently ask, “What can we [dermatologists] do to prepare for potential modifier -25 audits?” My advice is always, “Physician audit thyself.” I recommend self-auditing to make sure you and your practice are in compliance with modifier -25 documentation requirements. In a March 2017 Cutis column on modifier -25, I discussed what constitutes separate and distinct E/M services and what is included in a procedure’s global surgical package.¹¹ A self-audit is as simple as pulling 10 to 20 medical records in which a same-day procedure and E/M service were billed. Cross out any information in the note included in the procedure’s global surgical package including history associated with establishing the diagnosis, physical examination of the procedure area(s), and discussion of treatment options. If complete documentation for an E/M is still present after removing the procedure and associated evaluation, you have passed the self-audit. If not, consider changing your coding to better reflect the documentation in your records. In my experience, insurance auditors are not physicians and often are not even medical professionals. Clear documentation and clear existence of a separate, distinct, and medically necessary E/M service is needed to succeed in a modifier -25 audit.

Final Thoughts

Dermatologists should rejoice that Anthem decided to rescind its modifier -25 policy. If this policy had gone into effect, the modifier -25 reduction would likely have spread to most other insurers as industry standard. This victory certainly shows what can be accomplished when organized medicine works together. Your state dermatology and medical societies, national societies, and the AMA collaborated on a critical existential threat to cost-effective and efficient patient care and won. These organizations deserve your membership and support as well as your thanks; however, our celebration must be short-lived, as there still are other insurers with modifier -25 reductions in place, and audits have been promised. We must continue to focus on proper use and documentation of modifier -25. This effort will not only help dermatologists decrease the risk of large recoupments from audits but also help the AADA continue to oppose inappropriate payment policies.

Winter is the time when many religions celebrate a renewal of the year as the days begin to get longer. On January 1 of each year in the United States we celebrate the official activation of new and revised Current Procedural Terminology (CPT) codes with which physicians report their services, and if they are lucky, they are compensated when these services are provided. In 2018, there are new sets of codes for photodynamic therapy (PDT) and lasers that all dermatologists should be aware of.

Photodynamic Therapy

Use of PDT is said to date back as early as the 1900s,1 but it did not become a mainstream treatment modality in the United States until 2002 when the first CPT code for PDT (96567) became effective.² Treatment involved application of a photosensitizing drug and its subsequent activation with a special blue light. Physicians faced an uphill battle for many years, as payers would either not reimburse the CPT code itself or the corresponding Healthcare Common Procedure Coding System supply code J7308, which became effective on January 1, 2004,3 to allow for reimbursement of a 354-mg, single-dose ampoule preparation of aminolevulinic acid hydrochloride as the photosensitizing drug. By deeming the procedure experimental and/or medically unnecessary, insurers often refused payment when 96567 was used—a situation that still occurs today with regard to PDT reimbursement, although less often. In my experience, this code was considered by the American Medical Association/Specialty Society Relative Value Scale Update Committee to be a nonphysician work code with the assumption that the procedure was done by nonprovider staff (eg, medical assistant, licensed practical nurse, registered nurse) and that the physician did nothing but order the treatment.

In 2004, a methyl aminolevulinate cream that was activated with a red light source was brought to market; however, after failing to gain a substantial market share, the product is no longer available in the United States. In May of 2016, a nanoemulsion gel formulation of aminolevulinic acid hydrochloride 10% was approved by the US Food and Drug Administration4 for use with a red light source. Unlike 5-aminolevulinic acid hydrochloride solution, which was approved for application with no prior debridement of the skin,⁵ the new gel formulation was meant to be applied after degreasing with an ethanol- or isopropanol-soaked cotton pad and removal of any scaling or crusts, followed by roughening of the lesion surfaces (with care taken to avoid bleeding).⁴ The product must be administered by a health care provider and is reported using CPT codes 96573 and 96574, which are new in 2018 and are discussed in more detail below. Effective January 1, 2018, the Healthcare Common Procedure Coding System supply code for the product is J7345 (aminolevulinic acid hydrochloride gel for topical administration, 10% gel, 10 mg).6 A single tube contains 200 mg, so when an entire tube is used (which is typical), 200 units must be reported. Partial tubes may be used in some patients and should be reported appropriately based on actual usage.

The development of new CPT codes for PDT revealed a middle ground in which many physicians, including myself, have applied the photosensitizing drug themselves instead of a nonphysician provider in order to use their professional judgment to ensure the entire treatment area was covered and also allow for multiple applications of the drug to lesions that in their opinion may have warranted greater dosing, which led to the creation of CPT code 96573. The revision and refinement from one code to 3 (96567, 96573, and 96574) also involved rewording of the preamble for all 3 codes so that the phrase “premalignant and/or malignant lesions” was simplified to “premalignant lesions.” This change was made so that if and when this therapeutic approach is refined enough to be used on malignant lesions, new codes can be created to distinguish between the work performed for both types of lesions.

The new PDT codes include 96573 (photodynamic therapy by external application of light to destroy premalignant lesions of the skin and adjacent mucosa with application and illumination/activation of photosensitizing drug[s] provided by a physician or other qualified healthcare professional, per day) and 96574 (debridement of premalignant hyperkeratotic lesion[s][ie, targeted curettage, abrasion] followed with photodynamic therapy by external application of light to destroy premalignant lesions of the skin and adjacent mucosa with application and illumination/activation of photosensitizing drug[s] provided by a physician or other qualified healthcare professional, per day). According to the 2018 CPT manual,² these codes should be used to report nonsurgical treatment of cutaneous lesions using PDT (ie, external application of light to destroy premalignant lesions of the skin and adjacent mucosa by activation of photosensitizing drug). A treatment session is defined as an application of a photosensitizer to all lesions within an anatomic area (eg, face, scalp) with or without debridement of all premalignant hyperkeratotic lesions in that area followed by illumination and activation with an appropriate light source. Providers should not report codes for debridement (11000, 11001, 11004, 11005), lesion shaving (11300–11313), biopsy (11100, 11101), or lesion excision (11400–11471) within the treatment area on the same day that PDT is administered.²

With the inclusion of these new PDT codes, the older code 96567 (photodynamic therapy by external application of light to destroy premalignant lesions of the skin and adjacent mucosa with application and illumination/activation of photosensitive drug[s], per day)—which is the base or parent code of the set—should only be used for reporting PDT when a physician or other qualified health care professional is not directly involved in the delivery of the service. Code 96573 is an upgrade to 96567 to account for physician work, while code 96574 captures the extra work of disruption of the skin barrier by debridement.

The novelty here is that old codes often are replaced when new codes come along. The reader should be aware of the distinct differences, as the total value expressed in relative value units for code 96567 is lower than it was in 2017 (3.24 vs 3.80), while the 2 newer codes have higher values (codes 96573 and 96574, 5.37 and 6.92, respectively). Additionally, the reader should note that only one of the 3 codes can be used on a given anatomic area (ie, face and scalp) on a given day. In general, a single-dose package of either of the approved photosensitizing drugs can usually treat an entire anatomic area. The codes themselves are not reserved for specific anatomic areas, but the US Food and Drug Administration clearances are for only face and scalp for both drugs, so the use of more than 2 PDT codes on a given day might raise payer queries.

Whatever you do, be sure your documentation includes an explicit notation about who applied the photosensitizing drug and the technique used for debridement, if performed. Code 96574 explicitly refers to targeted curettage and abrasion but does not include other destructive modalities (eg, chemical peeling), which an auditor may or may not consider an acceptable method of debridement. Personally, I will not be using peels as a justifier for this code.

Lasers

Lasers have played a role in the treatment of severe scarring in wounded warriors and other patient populations.⁷ Until 2018, there were no CPT codes that allowed precise reporting of these therapies. We now have a series of tracking codes, which are not valued by the Specialty Society Relative Value Scale Update Committee process but are nonetheless reportable, for this valuable treatment.⁸

The base code for a new pair of codes for reporting fractional ablative laser treatment, which is modeled after the skin graft code series, is 0479T (fractional ablative laser fenestration of burn and traumatic scars for functional improvement; first 100 cm² or part thereof, or 1% of body surface area of infants and children). The add-on code is 0480T (fractional ablative laser fenestration of burn and traumatic scars for functional improvement; each additional 100 cm², or each additional 1% of body surface area of infants and children, or part thereof [list separately in addition to code for primary procedure]), which means the code can be reported multiple times in addition to a single unit of 0479T. The aggregate treatment area should only be reported once per day regardless of the number of passes of one or more lasers over the area that day, and codes 0479T and 0480T should not be reported with codes 0491T or 0492T, which are a new family of tracking codes used for ablative laser treatment of chronic open wounds. If the scars are excised in a full-thickness manner, the benign excision codes 11400 to 11446 should be used instead.

For laser treatment of open wounds, 0491T (ablative laser treatment, noncontact, full-field and fractional ablation, open wound, per day, total treatment surface area; first 20 cm² or less) is the base code for this pair of codes, and 0492T (ablative laser treatment, noncontact, full-field and fractional ablation, open wound, per day, total treatment surface area; each additional 20 cm², or part thereof [list separately in addition to code for primary procedure]) is the add-on code, similar to the 0479T and 00480T codes described above. Keep in mind that all 4 of these tracking codes do not have defined values, and payment is at the discretion of the payer. If utilization of the procedures increases along with the development of appropriate evidence-based literature to support it, it is possible these will be converted into standard category I CPT codes that will be valued and covered by payers.

Final Thoughts

For more details on the new codes for PDT and lasers, I would strongly suggest obtaining a copy of CPT Changes 2018: An Insider’s View (https://commerce.ama-assn.org/store/catalog/productDetail.jsp?product_id=prod2800018&navAction=push), as well as the 2018 CPT manual for those who are actively practicing. Members of the American Academy of Dermatology also can get the new CPT manual as part of the group’s Coding Value Pack (https://store.aad.org/products/11383) along with Principles of Documentation for Dermatology and 2018 Coding & Billing for Dermatology.

Winter is the time when many religions celebrate a renewal of the year as the days begin to get longer. On January 1 of each year in the United States we celebrate the official activation of new and revised Current Procedural Terminology (CPT) codes with which physicians report their services, and if they are lucky, they are compensated when these services are provided. In 2018, there are new sets of codes for photodynamic therapy (PDT) and lasers that all dermatologists should be aware of.

Photodynamic Therapy

Use of PDT is said to date back as early as the 1900s,1 but it did not become a mainstream treatment modality in the United States until 2002 when the first CPT code for PDT (96567) became effective.² Treatment involved application of a photosensitizing drug and its subsequent activation with a special blue light. Physicians faced an uphill battle for many years, as payers would either not reimburse the CPT code itself or the corresponding Healthcare Common Procedure Coding System supply code J7308, which became effective on January 1, 2004,3 to allow for reimbursement of a 354-mg, single-dose ampoule preparation of aminolevulinic acid hydrochloride as the photosensitizing drug. By deeming the procedure experimental and/or medically unnecessary, insurers often refused payment when 96567 was used—a situation that still occurs today with regard to PDT reimbursement, although less often. In my experience, this code was considered by the American Medical Association/Specialty Society Relative Value Scale Update Committee to be a nonphysician work code with the assumption that the procedure was done by nonprovider staff (eg, medical assistant, licensed practical nurse, registered nurse) and that the physician did nothing but order the treatment.

In 2004, a methyl aminolevulinate cream that was activated with a red light source was brought to market; however, after failing to gain a substantial market share, the product is no longer available in the United States. In May of 2016, a nanoemulsion gel formulation of aminolevulinic acid hydrochloride 10% was approved by the US Food and Drug Administration4 for use with a red light source. Unlike 5-aminolevulinic acid hydrochloride solution, which was approved for application with no prior debridement of the skin,⁵ the new gel formulation was meant to be applied after degreasing with an ethanol- or isopropanol-soaked cotton pad and removal of any scaling or crusts, followed by roughening of the lesion surfaces (with care taken to avoid bleeding).⁴ The product must be administered by a health care provider and is reported using CPT codes 96573 and 96574, which are new in 2018 and are discussed in more detail below. Effective January 1, 2018, the Healthcare Common Procedure Coding System supply code for the product is J7345 (aminolevulinic acid hydrochloride gel for topical administration, 10% gel, 10 mg).6 A single tube contains 200 mg, so when an entire tube is used (which is typical), 200 units must be reported. Partial tubes may be used in some patients and should be reported appropriately based on actual usage.

The development of new CPT codes for PDT revealed a middle ground in which many physicians, including myself, have applied the photosensitizing drug themselves instead of a nonphysician provider in order to use their professional judgment to ensure the entire treatment area was covered and also allow for multiple applications of the drug to lesions that in their opinion may have warranted greater dosing, which led to the creation of CPT code 96573. The revision and refinement from one code to 3 (96567, 96573, and 96574) also involved rewording of the preamble for all 3 codes so that the phrase “premalignant and/or malignant lesions” was simplified to “premalignant lesions.” This change was made so that if and when this therapeutic approach is refined enough to be used on malignant lesions, new codes can be created to distinguish between the work performed for both types of lesions.

The new PDT codes include 96573 (photodynamic therapy by external application of light to destroy premalignant lesions of the skin and adjacent mucosa with application and illumination/activation of photosensitizing drug[s] provided by a physician or other qualified healthcare professional, per day) and 96574 (debridement of premalignant hyperkeratotic lesion[s][ie, targeted curettage, abrasion] followed with photodynamic therapy by external application of light to destroy premalignant lesions of the skin and adjacent mucosa with application and illumination/activation of photosensitizing drug[s] provided by a physician or other qualified healthcare professional, per day). According to the 2018 CPT manual,² these codes should be used to report nonsurgical treatment of cutaneous lesions using PDT (ie, external application of light to destroy premalignant lesions of the skin and adjacent mucosa by activation of photosensitizing drug). A treatment session is defined as an application of a photosensitizer to all lesions within an anatomic area (eg, face, scalp) with or without debridement of all premalignant hyperkeratotic lesions in that area followed by illumination and activation with an appropriate light source. Providers should not report codes for debridement (11000, 11001, 11004, 11005), lesion shaving (11300–11313), biopsy (11100, 11101), or lesion excision (11400–11471) within the treatment area on the same day that PDT is administered.²

With the inclusion of these new PDT codes, the older code 96567 (photodynamic therapy by external application of light to destroy premalignant lesions of the skin and adjacent mucosa with application and illumination/activation of photosensitive drug[s], per day)—which is the base or parent code of the set—should only be used for reporting PDT when a physician or other qualified health care professional is not directly involved in the delivery of the service. Code 96573 is an upgrade to 96567 to account for physician work, while code 96574 captures the extra work of disruption of the skin barrier by debridement.

The novelty here is that old codes often are replaced when new codes come along. The reader should be aware of the distinct differences, as the total value expressed in relative value units for code 96567 is lower than it was in 2017 (3.24 vs 3.80), while the 2 newer codes have higher values (codes 96573 and 96574, 5.37 and 6.92, respectively). Additionally, the reader should note that only one of the 3 codes can be used on a given anatomic area (ie, face and scalp) on a given day. In general, a single-dose package of either of the approved photosensitizing drugs can usually treat an entire anatomic area. The codes themselves are not reserved for specific anatomic areas, but the US Food and Drug Administration clearances are for only face and scalp for both drugs, so the use of more than 2 PDT codes on a given day might raise payer queries.

Whatever you do, be sure your documentation includes an explicit notation about who applied the photosensitizing drug and the technique used for debridement, if performed. Code 96574 explicitly refers to targeted curettage and abrasion but does not include other destructive modalities (eg, chemical peeling), which an auditor may or may not consider an acceptable method of debridement. Personally, I will not be using peels as a justifier for this code.

Lasers

Lasers have played a role in the treatment of severe scarring in wounded warriors and other patient populations.⁷ Until 2018, there were no CPT codes that allowed precise reporting of these therapies. We now have a series of tracking codes, which are not valued by the Specialty Society Relative Value Scale Update Committee process but are nonetheless reportable, for this valuable treatment.⁸

The base code for a new pair of codes for reporting fractional ablative laser treatment, which is modeled after the skin graft code series, is 0479T (fractional ablative laser fenestration of burn and traumatic scars for functional improvement; first 100 cm² or part thereof, or 1% of body surface area of infants and children). The add-on code is 0480T (fractional ablative laser fenestration of burn and traumatic scars for functional improvement; each additional 100 cm², or each additional 1% of body surface area of infants and children, or part thereof [list separately in addition to code for primary procedure]), which means the code can be reported multiple times in addition to a single unit of 0479T. The aggregate treatment area should only be reported once per day regardless of the number of passes of one or more lasers over the area that day, and codes 0479T and 0480T should not be reported with codes 0491T or 0492T, which are a new family of tracking codes used for ablative laser treatment of chronic open wounds. If the scars are excised in a full-thickness manner, the benign excision codes 11400 to 11446 should be used instead.

For laser treatment of open wounds, 0491T (ablative laser treatment, noncontact, full-field and fractional ablation, open wound, per day, total treatment surface area; first 20 cm² or less) is the base code for this pair of codes, and 0492T (ablative laser treatment, noncontact, full-field and fractional ablation, open wound, per day, total treatment surface area; each additional 20 cm², or part thereof [list separately in addition to code for primary procedure]) is the add-on code, similar to the 0479T and 00480T codes described above. Keep in mind that all 4 of these tracking codes do not have defined values, and payment is at the discretion of the payer. If utilization of the procedures increases along with the development of appropriate evidence-based literature to support it, it is possible these will be converted into standard category I CPT codes that will be valued and covered by payers.

Final Thoughts

For more details on the new codes for PDT and lasers, I would strongly suggest obtaining a copy of CPT Changes 2018: An Insider’s View (https://commerce.ama-assn.org/store/catalog/productDetail.jsp?product_id=prod2800018&navAction=push), as well as the 2018 CPT manual for those who are actively practicing. Members of the American Academy of Dermatology also can get the new CPT manual as part of the group’s Coding Value Pack (https://store.aad.org/products/11383) along with Principles of Documentation for Dermatology and 2018 Coding & Billing for Dermatology.

Winter is the time when many religions celebrate a renewal of the year as the days begin to get longer. On January 1 of each year in the United States we celebrate the official activation of new and revised Current Procedural Terminology (CPT) codes with which physicians report their services, and if they are lucky, they are compensated when these services are provided. In 2018, there are new sets of codes for photodynamic therapy (PDT) and lasers that all dermatologists should be aware of.

Photodynamic Therapy

Use of PDT is said to date back as early as the 1900s,1 but it did not become a mainstream treatment modality in the United States until 2002 when the first CPT code for PDT (96567) became effective.² Treatment involved application of a photosensitizing drug and its subsequent activation with a special blue light. Physicians faced an uphill battle for many years, as payers would either not reimburse the CPT code itself or the corresponding Healthcare Common Procedure Coding System supply code J7308, which became effective on January 1, 2004,3 to allow for reimbursement of a 354-mg, single-dose ampoule preparation of aminolevulinic acid hydrochloride as the photosensitizing drug. By deeming the procedure experimental and/or medically unnecessary, insurers often refused payment when 96567 was used—a situation that still occurs today with regard to PDT reimbursement, although less often. In my experience, this code was considered by the American Medical Association/Specialty Society Relative Value Scale Update Committee to be a nonphysician work code with the assumption that the procedure was done by nonprovider staff (eg, medical assistant, licensed practical nurse, registered nurse) and that the physician did nothing but order the treatment.

In 2004, a methyl aminolevulinate cream that was activated with a red light source was brought to market; however, after failing to gain a substantial market share, the product is no longer available in the United States. In May of 2016, a nanoemulsion gel formulation of aminolevulinic acid hydrochloride 10% was approved by the US Food and Drug Administration4 for use with a red light source. Unlike 5-aminolevulinic acid hydrochloride solution, which was approved for application with no prior debridement of the skin,⁵ the new gel formulation was meant to be applied after degreasing with an ethanol- or isopropanol-soaked cotton pad and removal of any scaling or crusts, followed by roughening of the lesion surfaces (with care taken to avoid bleeding).⁴ The product must be administered by a health care provider and is reported using CPT codes 96573 and 96574, which are new in 2018 and are discussed in more detail below. Effective January 1, 2018, the Healthcare Common Procedure Coding System supply code for the product is J7345 (aminolevulinic acid hydrochloride gel for topical administration, 10% gel, 10 mg).6 A single tube contains 200 mg, so when an entire tube is used (which is typical), 200 units must be reported. Partial tubes may be used in some patients and should be reported appropriately based on actual usage.

The development of new CPT codes for PDT revealed a middle ground in which many physicians, including myself, have applied the photosensitizing drug themselves instead of a nonphysician provider in order to use their professional judgment to ensure the entire treatment area was covered and also allow for multiple applications of the drug to lesions that in their opinion may have warranted greater dosing, which led to the creation of CPT code 96573. The revision and refinement from one code to 3 (96567, 96573, and 96574) also involved rewording of the preamble for all 3 codes so that the phrase “premalignant and/or malignant lesions” was simplified to “premalignant lesions.” This change was made so that if and when this therapeutic approach is refined enough to be used on malignant lesions, new codes can be created to distinguish between the work performed for both types of lesions.

The new PDT codes include 96573 (photodynamic therapy by external application of light to destroy premalignant lesions of the skin and adjacent mucosa with application and illumination/activation of photosensitizing drug[s] provided by a physician or other qualified healthcare professional, per day) and 96574 (debridement of premalignant hyperkeratotic lesion[s][ie, targeted curettage, abrasion] followed with photodynamic therapy by external application of light to destroy premalignant lesions of the skin and adjacent mucosa with application and illumination/activation of photosensitizing drug[s] provided by a physician or other qualified healthcare professional, per day). According to the 2018 CPT manual,² these codes should be used to report nonsurgical treatment of cutaneous lesions using PDT (ie, external application of light to destroy premalignant lesions of the skin and adjacent mucosa by activation of photosensitizing drug). A treatment session is defined as an application of a photosensitizer to all lesions within an anatomic area (eg, face, scalp) with or without debridement of all premalignant hyperkeratotic lesions in that area followed by illumination and activation with an appropriate light source. Providers should not report codes for debridement (11000, 11001, 11004, 11005), lesion shaving (11300–11313), biopsy (11100, 11101), or lesion excision (11400–11471) within the treatment area on the same day that PDT is administered.²

With the inclusion of these new PDT codes, the older code 96567 (photodynamic therapy by external application of light to destroy premalignant lesions of the skin and adjacent mucosa with application and illumination/activation of photosensitive drug[s], per day)—which is the base or parent code of the set—should only be used for reporting PDT when a physician or other qualified health care professional is not directly involved in the delivery of the service. Code 96573 is an upgrade to 96567 to account for physician work, while code 96574 captures the extra work of disruption of the skin barrier by debridement.

The novelty here is that old codes often are replaced when new codes come along. The reader should be aware of the distinct differences, as the total value expressed in relative value units for code 96567 is lower than it was in 2017 (3.24 vs 3.80), while the 2 newer codes have higher values (codes 96573 and 96574, 5.37 and 6.92, respectively). Additionally, the reader should note that only one of the 3 codes can be used on a given anatomic area (ie, face and scalp) on a given day. In general, a single-dose package of either of the approved photosensitizing drugs can usually treat an entire anatomic area. The codes themselves are not reserved for specific anatomic areas, but the US Food and Drug Administration clearances are for only face and scalp for both drugs, so the use of more than 2 PDT codes on a given day might raise payer queries.

Whatever you do, be sure your documentation includes an explicit notation about who applied the photosensitizing drug and the technique used for debridement, if performed. Code 96574 explicitly refers to targeted curettage and abrasion but does not include other destructive modalities (eg, chemical peeling), which an auditor may or may not consider an acceptable method of debridement. Personally, I will not be using peels as a justifier for this code.

Lasers

Lasers have played a role in the treatment of severe scarring in wounded warriors and other patient populations.⁷ Until 2018, there were no CPT codes that allowed precise reporting of these therapies. We now have a series of tracking codes, which are not valued by the Specialty Society Relative Value Scale Update Committee process but are nonetheless reportable, for this valuable treatment.⁸

The base code for a new pair of codes for reporting fractional ablative laser treatment, which is modeled after the skin graft code series, is 0479T (fractional ablative laser fenestration of burn and traumatic scars for functional improvement; first 100 cm² or part thereof, or 1% of body surface area of infants and children). The add-on code is 0480T (fractional ablative laser fenestration of burn and traumatic scars for functional improvement; each additional 100 cm², or each additional 1% of body surface area of infants and children, or part thereof [list separately in addition to code for primary procedure]), which means the code can be reported multiple times in addition to a single unit of 0479T. The aggregate treatment area should only be reported once per day regardless of the number of passes of one or more lasers over the area that day, and codes 0479T and 0480T should not be reported with codes 0491T or 0492T, which are a new family of tracking codes used for ablative laser treatment of chronic open wounds. If the scars are excised in a full-thickness manner, the benign excision codes 11400 to 11446 should be used instead.

For laser treatment of open wounds, 0491T (ablative laser treatment, noncontact, full-field and fractional ablation, open wound, per day, total treatment surface area; first 20 cm² or less) is the base code for this pair of codes, and 0492T (ablative laser treatment, noncontact, full-field and fractional ablation, open wound, per day, total treatment surface area; each additional 20 cm², or part thereof [list separately in addition to code for primary procedure]) is the add-on code, similar to the 0479T and 00480T codes described above. Keep in mind that all 4 of these tracking codes do not have defined values, and payment is at the discretion of the payer. If utilization of the procedures increases along with the development of appropriate evidence-based literature to support it, it is possible these will be converted into standard category I CPT codes that will be valued and covered by payers.

Final Thoughts

For more details on the new codes for PDT and lasers, I would strongly suggest obtaining a copy of CPT Changes 2018: An Insider’s View (https://commerce.ama-assn.org/store/catalog/productDetail.jsp?product_id=prod2800018&navAction=push), as well as the 2018 CPT manual for those who are actively practicing. Members of the American Academy of Dermatology also can get the new CPT manual as part of the group’s Coding Value Pack (https://store.aad.org/products/11383) along with Principles of Documentation for Dermatology and 2018 Coding & Billing for Dermatology.

The year is moving ahead, and we are in the first year with a new president and a new administration. There have been multiple attempts to defund, revoke, or otherwise eliminate the Patient Protection and Affordable Care Act. As a physician, you may be asking, “What should I be doing for MACRA (Medicare Access and CHIP Reauthorization Act of 2015) and MIPS (Merit-Based Incentive Payments System)?” Everyone wants help, and there are lots of resources.¹ The American Academy of Dermatology has excellent resources focused on how to survive in the new world of acronymic programs that seem to create more unfunded mandates and paperwork for every one of us.²

RELATED VIDEO: Update on Coding Changes: Report From the Mount Sinai Fall Symposium

What is MACRA?

The sustainable growth rate formula that had determined Medicare Part B reimbursement rates was repealed with MACRA. The sustainable growth rate, a flawed concept since it came into play under the Balanced Budget Act of 1997,³ in essence kept track of health care spending and tracked the increasing deficit that was accruing to providers, which led to statutory cuts in the Medicare conversion factor that usually were followed by Band-Aid fixes from Congress and increased each subsequent year to pay back that debt. In addition, MACRA provides a positive annual update of 0.5% in the Medicare fee schedule until 2019. This aspect of MACRA is good for providers, as was the reauthorization of the Children’s Health Insurance Program. It would be difficult to argue against the benefits of these aspects of the law.

Of course, there is no such thing as a free lunch. The less pleasant side of MACRA is the Quality Payment Program under which providers will be paid based on the quality and effectiveness of the care provided; physician assistants, nurse practitioners, clinical nurse specialists, and certified registered nurse anesthetists also will be under the new system in addition to physicians. We are to be paid based on value, not volume. Heady stuff. The devil, as always, is in the details, as the factors we will be measured against are diverse. Having an electronic medical record (EMR) can make capturing data for some of these measures a bit less onerous. If you do not have an EMR, the cost of transitioning to one, especially if you are a small solo practice or approaching the end of your career, may outweigh the benefits.

RELATED VIDEO: Update on Coding Changes: Report From the Mount Sinai Fall Symposium

What is MIPS?

Your traditional fee-for-service payment is linked to your performance on an overall physician quality score by MIPS. Most of us will take this route. The old systems that determined pleasure or pain for providers, including the Physician Quality Reporting System, meaningful use, and the Value-Based Payment Modifier (Value Modifier) are now gone.

A small group of providers, most likely those in large multispecialty groups or academic settings, will instead participate in advanced Alternative Payment Models that will provide a lump sum bonus payment of 5% of their Medicare charges from 2019 to 2024. Not for the faint of heart, this method is more complex for anyone who is not employed by a large enterprise.

For those taking the more common MIPS pathway, beginning in 2019 you can see a penalty of up to 4% on your Medicare payments if you do nothing and a bonus of up to 4% if you do it all. This rate will increase to a 5% penalty or a reward of up to 5% in 2020, 7% in 2021, and 9% in 2022. The penalty is a result of nonparticipation, while complete participation might get you to the maximum bonus. Of course, the bonus pool is limited, and if everyone does it all, the bonus would be much less, assuming the program is not changed or eliminated by the current administration. At the time of writing this column, Senate Majority Leader Mitch McConnell (R-KY) has failed multiple times to pass a Patient Protection and Affordable Care Act repeal bill following rebellions in his own party.⁴

So what do you, dear colleague, need to do right now, or at least before the end of the calendar year? You could do it all and try to grab the brass ring 4% bonus for 2019, putting time, effort, and expense into going after what could be an elusive reward. Or you could simply avoid the penalty and go back to work knowing you have locked in normal payments (whatever that will be!) for 2019. We are both doing the latter, and so might you, especially if you have not done anything yet this year.

MIPS Made Merry

To learn what you need to do or can do, pay a visit to the Quality Payment Program website (https://qpp.cms.gov/) where you can look yourself up with your national provider identifier number and find out what system you are under. Unless you are part of a large enterprise, you are likely under MIPS, but it never hurts to check.

It will then give you the options for reporting as an individual or a group. Either way, you can send in quality data through your routine Medicare claims process, which is our suggested route; no registry, no EMR, just an extra line on a claim form. You can review the complete list of quality measures that are available on the Quality Payment Program website (https://qpp.cms.gov/mips/quality-measures). There are 271 measures to read through and ponder, but by now you already have a headache, so take the following advice:

• Filter with the “Data Submission Method” by checking off “Claims,” which gives you 74 choices.
• Filter further with the “Specialty Measure Set”by checking off “Dermatology,” which gives you 4 choices.
• The top choice and probably the easiest one to get your staff to help with is “Documentation of Current Medications in the Medical Record,” which if you click on it further identifies it as “Quality ID: 130,” the official name of this measure.

You can see the MIPS program information in all its bureaucratic glory on the Quality Payment Program website (https://qpp.cms.gov/resources/education); click on “Quality Measure Specifications” to download a 250 MB zip file that contains information on all the measures in detail. The Measure #130 (Documentation of Current Medications in the Medical Record) file indicates that the clinician must use a G code (G8427) to report that current medications have been documented. The measure reads: “Eligible clinician attests to documenting, updating or reviewing a patient’s current medications using all immediate resources available on the date of encounter. This list must include ALL known prescriptions, over-the counters, herbals, and vitamin/mineral/dietary (nutritional) supplements AND must contain the medications’ name, dosages, frequency and route of administration.”⁵

You likely already confirm current medications with patients in some form or other, so simply look at the list of medications and supplements with all their dosages, frequencies, and routes of administration and sign the sheet of paper your practice likely already uses as an extra way of confirming that you have reviewed it. You report code G8427 as you would any Current Procedural Terminology code and link it to any International Classification of Diseases, Tenth Revision, code in your claim along with any evaluation and management and/or procedure codes that you would otherwise report for that encounter.

Some clearinghouses will not accept $0 charges, so we recommend you place a $0.01 charge for G8427 and write it off later. Upon receiving your explanation of benefits, you should notice 2 remark codes relating to the G8427 line: CO-246 and N620. Both of these codes indicate that the Centers for Medicare & Medicaid Services acknowledge your quality submission. To avoid that 4% penalty in 2019, you only need to do it once, but doing it a few times until you get back an explanation of benefits acknowledging it may help you sleep better.

Conclusion

Although the future of the Patient Protection and Affordable Care Act is still unclear, one thing is for sure: MACRA and MIPS are here to stay. Avoid the 4% penalty in 2019 and take good care of your patients and, if eligible, make donations to the American Academy of Dermatology Association Political Action Committee (skinPAC). It is going to be a wild ride.

The year is moving ahead, and we are in the first year with a new president and a new administration. There have been multiple attempts to defund, revoke, or otherwise eliminate the Patient Protection and Affordable Care Act. As a physician, you may be asking, “What should I be doing for MACRA (Medicare Access and CHIP Reauthorization Act of 2015) and MIPS (Merit-Based Incentive Payments System)?” Everyone wants help, and there are lots of resources.¹ The American Academy of Dermatology has excellent resources focused on how to survive in the new world of acronymic programs that seem to create more unfunded mandates and paperwork for every one of us.²

RELATED VIDEO: Update on Coding Changes: Report From the Mount Sinai Fall Symposium

What is MACRA?

The sustainable growth rate formula that had determined Medicare Part B reimbursement rates was repealed with MACRA. The sustainable growth rate, a flawed concept since it came into play under the Balanced Budget Act of 1997,³ in essence kept track of health care spending and tracked the increasing deficit that was accruing to providers, which led to statutory cuts in the Medicare conversion factor that usually were followed by Band-Aid fixes from Congress and increased each subsequent year to pay back that debt. In addition, MACRA provides a positive annual update of 0.5% in the Medicare fee schedule until 2019. This aspect of MACRA is good for providers, as was the reauthorization of the Children’s Health Insurance Program. It would be difficult to argue against the benefits of these aspects of the law.

Of course, there is no such thing as a free lunch. The less pleasant side of MACRA is the Quality Payment Program under which providers will be paid based on the quality and effectiveness of the care provided; physician assistants, nurse practitioners, clinical nurse specialists, and certified registered nurse anesthetists also will be under the new system in addition to physicians. We are to be paid based on value, not volume. Heady stuff. The devil, as always, is in the details, as the factors we will be measured against are diverse. Having an electronic medical record (EMR) can make capturing data for some of these measures a bit less onerous. If you do not have an EMR, the cost of transitioning to one, especially if you are a small solo practice or approaching the end of your career, may outweigh the benefits.

RELATED VIDEO: Update on Coding Changes: Report From the Mount Sinai Fall Symposium

What is MIPS?

Your traditional fee-for-service payment is linked to your performance on an overall physician quality score by MIPS. Most of us will take this route. The old systems that determined pleasure or pain for providers, including the Physician Quality Reporting System, meaningful use, and the Value-Based Payment Modifier (Value Modifier) are now gone.

A small group of providers, most likely those in large multispecialty groups or academic settings, will instead participate in advanced Alternative Payment Models that will provide a lump sum bonus payment of 5% of their Medicare charges from 2019 to 2024. Not for the faint of heart, this method is more complex for anyone who is not employed by a large enterprise.

For those taking the more common MIPS pathway, beginning in 2019 you can see a penalty of up to 4% on your Medicare payments if you do nothing and a bonus of up to 4% if you do it all. This rate will increase to a 5% penalty or a reward of up to 5% in 2020, 7% in 2021, and 9% in 2022. The penalty is a result of nonparticipation, while complete participation might get you to the maximum bonus. Of course, the bonus pool is limited, and if everyone does it all, the bonus would be much less, assuming the program is not changed or eliminated by the current administration. At the time of writing this column, Senate Majority Leader Mitch McConnell (R-KY) has failed multiple times to pass a Patient Protection and Affordable Care Act repeal bill following rebellions in his own party.⁴

So what do you, dear colleague, need to do right now, or at least before the end of the calendar year? You could do it all and try to grab the brass ring 4% bonus for 2019, putting time, effort, and expense into going after what could be an elusive reward. Or you could simply avoid the penalty and go back to work knowing you have locked in normal payments (whatever that will be!) for 2019. We are both doing the latter, and so might you, especially if you have not done anything yet this year.

MIPS Made Merry

To learn what you need to do or can do, pay a visit to the Quality Payment Program website (https://qpp.cms.gov/) where you can look yourself up with your national provider identifier number and find out what system you are under. Unless you are part of a large enterprise, you are likely under MIPS, but it never hurts to check.

It will then give you the options for reporting as an individual or a group. Either way, you can send in quality data through your routine Medicare claims process, which is our suggested route; no registry, no EMR, just an extra line on a claim form. You can review the complete list of quality measures that are available on the Quality Payment Program website (https://qpp.cms.gov/mips/quality-measures). There are 271 measures to read through and ponder, but by now you already have a headache, so take the following advice:

• Filter with the “Data Submission Method” by checking off “Claims,” which gives you 74 choices.
• Filter further with the “Specialty Measure Set”by checking off “Dermatology,” which gives you 4 choices.
• The top choice and probably the easiest one to get your staff to help with is “Documentation of Current Medications in the Medical Record,” which if you click on it further identifies it as “Quality ID: 130,” the official name of this measure.

You can see the MIPS program information in all its bureaucratic glory on the Quality Payment Program website (https://qpp.cms.gov/resources/education); click on “Quality Measure Specifications” to download a 250 MB zip file that contains information on all the measures in detail. The Measure #130 (Documentation of Current Medications in the Medical Record) file indicates that the clinician must use a G code (G8427) to report that current medications have been documented. The measure reads: “Eligible clinician attests to documenting, updating or reviewing a patient’s current medications using all immediate resources available on the date of encounter. This list must include ALL known prescriptions, over-the counters, herbals, and vitamin/mineral/dietary (nutritional) supplements AND must contain the medications’ name, dosages, frequency and route of administration.”⁵

You likely already confirm current medications with patients in some form or other, so simply look at the list of medications and supplements with all their dosages, frequencies, and routes of administration and sign the sheet of paper your practice likely already uses as an extra way of confirming that you have reviewed it. You report code G8427 as you would any Current Procedural Terminology code and link it to any International Classification of Diseases, Tenth Revision, code in your claim along with any evaluation and management and/or procedure codes that you would otherwise report for that encounter.

Some clearinghouses will not accept $0 charges, so we recommend you place a $0.01 charge for G8427 and write it off later. Upon receiving your explanation of benefits, you should notice 2 remark codes relating to the G8427 line: CO-246 and N620. Both of these codes indicate that the Centers for Medicare & Medicaid Services acknowledge your quality submission. To avoid that 4% penalty in 2019, you only need to do it once, but doing it a few times until you get back an explanation of benefits acknowledging it may help you sleep better.

Conclusion

Although the future of the Patient Protection and Affordable Care Act is still unclear, one thing is for sure: MACRA and MIPS are here to stay. Avoid the 4% penalty in 2019 and take good care of your patients and, if eligible, make donations to the American Academy of Dermatology Association Political Action Committee (skinPAC). It is going to be a wild ride.

The year is moving ahead, and we are in the first year with a new president and a new administration. There have been multiple attempts to defund, revoke, or otherwise eliminate the Patient Protection and Affordable Care Act. As a physician, you may be asking, “What should I be doing for MACRA (Medicare Access and CHIP Reauthorization Act of 2015) and MIPS (Merit-Based Incentive Payments System)?” Everyone wants help, and there are lots of resources.¹ The American Academy of Dermatology has excellent resources focused on how to survive in the new world of acronymic programs that seem to create more unfunded mandates and paperwork for every one of us.²

RELATED VIDEO: Update on Coding Changes: Report From the Mount Sinai Fall Symposium

What is MACRA?

The sustainable growth rate formula that had determined Medicare Part B reimbursement rates was repealed with MACRA. The sustainable growth rate, a flawed concept since it came into play under the Balanced Budget Act of 1997,³ in essence kept track of health care spending and tracked the increasing deficit that was accruing to providers, which led to statutory cuts in the Medicare conversion factor that usually were followed by Band-Aid fixes from Congress and increased each subsequent year to pay back that debt. In addition, MACRA provides a positive annual update of 0.5% in the Medicare fee schedule until 2019. This aspect of MACRA is good for providers, as was the reauthorization of the Children’s Health Insurance Program. It would be difficult to argue against the benefits of these aspects of the law.

Of course, there is no such thing as a free lunch. The less pleasant side of MACRA is the Quality Payment Program under which providers will be paid based on the quality and effectiveness of the care provided; physician assistants, nurse practitioners, clinical nurse specialists, and certified registered nurse anesthetists also will be under the new system in addition to physicians. We are to be paid based on value, not volume. Heady stuff. The devil, as always, is in the details, as the factors we will be measured against are diverse. Having an electronic medical record (EMR) can make capturing data for some of these measures a bit less onerous. If you do not have an EMR, the cost of transitioning to one, especially if you are a small solo practice or approaching the end of your career, may outweigh the benefits.

RELATED VIDEO: Update on Coding Changes: Report From the Mount Sinai Fall Symposium

What is MIPS?

Your traditional fee-for-service payment is linked to your performance on an overall physician quality score by MIPS. Most of us will take this route. The old systems that determined pleasure or pain for providers, including the Physician Quality Reporting System, meaningful use, and the Value-Based Payment Modifier (Value Modifier) are now gone.

A small group of providers, most likely those in large multispecialty groups or academic settings, will instead participate in advanced Alternative Payment Models that will provide a lump sum bonus payment of 5% of their Medicare charges from 2019 to 2024. Not for the faint of heart, this method is more complex for anyone who is not employed by a large enterprise.

For those taking the more common MIPS pathway, beginning in 2019 you can see a penalty of up to 4% on your Medicare payments if you do nothing and a bonus of up to 4% if you do it all. This rate will increase to a 5% penalty or a reward of up to 5% in 2020, 7% in 2021, and 9% in 2022. The penalty is a result of nonparticipation, while complete participation might get you to the maximum bonus. Of course, the bonus pool is limited, and if everyone does it all, the bonus would be much less, assuming the program is not changed or eliminated by the current administration. At the time of writing this column, Senate Majority Leader Mitch McConnell (R-KY) has failed multiple times to pass a Patient Protection and Affordable Care Act repeal bill following rebellions in his own party.⁴

So what do you, dear colleague, need to do right now, or at least before the end of the calendar year? You could do it all and try to grab the brass ring 4% bonus for 2019, putting time, effort, and expense into going after what could be an elusive reward. Or you could simply avoid the penalty and go back to work knowing you have locked in normal payments (whatever that will be!) for 2019. We are both doing the latter, and so might you, especially if you have not done anything yet this year.

MIPS Made Merry

To learn what you need to do or can do, pay a visit to the Quality Payment Program website (https://qpp.cms.gov/) where you can look yourself up with your national provider identifier number and find out what system you are under. Unless you are part of a large enterprise, you are likely under MIPS, but it never hurts to check.

It will then give you the options for reporting as an individual or a group. Either way, you can send in quality data through your routine Medicare claims process, which is our suggested route; no registry, no EMR, just an extra line on a claim form. You can review the complete list of quality measures that are available on the Quality Payment Program website (https://qpp.cms.gov/mips/quality-measures). There are 271 measures to read through and ponder, but by now you already have a headache, so take the following advice:

• Filter with the “Data Submission Method” by checking off “Claims,” which gives you 74 choices.
• Filter further with the “Specialty Measure Set”by checking off “Dermatology,” which gives you 4 choices.
• The top choice and probably the easiest one to get your staff to help with is “Documentation of Current Medications in the Medical Record,” which if you click on it further identifies it as “Quality ID: 130,” the official name of this measure.

You can see the MIPS program information in all its bureaucratic glory on the Quality Payment Program website (https://qpp.cms.gov/resources/education); click on “Quality Measure Specifications” to download a 250 MB zip file that contains information on all the measures in detail. The Measure #130 (Documentation of Current Medications in the Medical Record) file indicates that the clinician must use a G code (G8427) to report that current medications have been documented. The measure reads: “Eligible clinician attests to documenting, updating or reviewing a patient’s current medications using all immediate resources available on the date of encounter. This list must include ALL known prescriptions, over-the counters, herbals, and vitamin/mineral/dietary (nutritional) supplements AND must contain the medications’ name, dosages, frequency and route of administration.”⁵

You likely already confirm current medications with patients in some form or other, so simply look at the list of medications and supplements with all their dosages, frequencies, and routes of administration and sign the sheet of paper your practice likely already uses as an extra way of confirming that you have reviewed it. You report code G8427 as you would any Current Procedural Terminology code and link it to any International Classification of Diseases, Tenth Revision, code in your claim along with any evaluation and management and/or procedure codes that you would otherwise report for that encounter.

Some clearinghouses will not accept $0 charges, so we recommend you place a $0.01 charge for G8427 and write it off later. Upon receiving your explanation of benefits, you should notice 2 remark codes relating to the G8427 line: CO-246 and N620. Both of these codes indicate that the Centers for Medicare & Medicaid Services acknowledge your quality submission. To avoid that 4% penalty in 2019, you only need to do it once, but doing it a few times until you get back an explanation of benefits acknowledging it may help you sleep better.

Conclusion

Although the future of the Patient Protection and Affordable Care Act is still unclear, one thing is for sure: MACRA and MIPS are here to stay. Avoid the 4% penalty in 2019 and take good care of your patients and, if eligible, make donations to the American Academy of Dermatology Association Political Action Committee (skinPAC). It is going to be a wild ride.

Take-Home Points

• In-office diagnostic needle arthroscopy is a minimally invasive, rapid method for identification of intra-articular joint pathology.
• Cost savings of a significant value can be realized to both the patient and healthcare system via small-bore needle arthroscopy as opposed to MRI.
• Diagnostic needle arthroscopy can lead to quicker identification of pathology than MRI.
• Diagnostic needle arthroscopy can reduce the number of undue "formal" surgical diagnostic arthroscopies.
• Standardization of image quality of small bore arthroscopy may pose benefits to the variable quality of MRI.

Patient satisfaction and healthcare costs have taken a leading role in today’s health care market. Patient satisfaction, often categorized as the "patient experience," can be measured on numerous levels, such as access to healthcare professionals and diagnostic testing, wait time for appointments, and timely test results. Furthermore, patients’ having a full understanding of their pathology and treatment options may correlate with their overall satisfaction. Some metrics are subjective, but procedure costs are objective.

The algorithm for treating patients who present with knee or shoulder pathology to an orthopedic office involves taking a thorough history, performing a physical examination, and, in many cases, obtaining diagnostic imaging. After arriving at a diagnosis, the physician plans the patient’s treatment. In most cases in which magnetic resonance imaging (MRI) is required, the process can take 2 to 3 weeks.¹

Surgical knee arthroscopy is one of the most common procedures in the United States.^2,3 Worldwide, more than 2 million knee arthroscopies are performed yearly.⁴ For most procedures, the decision to treat is based on physical examination findings, and the diagnosis is confirmed with MRI. MRI has 86% sensitivity and 91% specificity for diagnosing ligamentous and meniscal tears.⁵ However, regular use of MRI has led to increased healthcare expenditures and a larger financial burden for patients, which can delay diagnosis.⁶

Since 2000, MRI use in the United States has risen significantly—by 10% over a 10-year period.⁷ According to a 2013 population analysis, 107 in 1000 US inhabitants had an MRI yearly.⁸

MRI costs vary widely because of several factors, including state/regional consideration, scanning in a hospital or an independent facility, and use of contrast and arthrography. In a 2017 study of the variation in noncontrast MRI costs at 71 hospitals and 26 independent facilities in Iowa, Westermann and colleagues⁹ found that, excluding radiologist interpretation fees, the mean MRI technical component cost to consumers was US $1874 (SD, $694; range, $500-$4000).

Patient factors may preclude use of MRI (Table).

Small-bore needle arthroscopy is a cost-effective alternative diagnostic tool with efficacy and accuracy similar to those of MRI and standard arthroscopy for intra-articular pathologies.^6,11 The procedure is performed with a disposable handpiece equipped with an internal light source and optics; this handpiece attaches to a reusable tablet for ease of transportation and visualization (Figure 1).

In 2014, Voigt and colleagues⁶ reported a significant net healthcare system cost saving with use of a small-needle arthroscope for diagnostic testing. The saving was estimated at $115 million to $177 million for simple isolation of medial meniscus pathology—or, more specifically, for appropriate care after more accurate visualization with the diagnostic needle arthroscope coupled with a decrease in false positives compared with MRI use. Other factors include the economic impact of the patient’s lost work hours, often associated with the time off needed for the MRI and for the follow-up visit for review of results.

Methods

We retrospectively reviewed the patient charts for 200 in-office knee and shoulder diagnostic needle arthroscopies performed by 5 surgeons over a 12-month period and examined the costs. Medicare, Medicaid, worker’s compensation, self-pay, and motor vehicle cases were excluded to provide uniformity across commercial insurance payers. Only the reimbursement amounts for Current Procedural Terminology codes 29870 (diagnostic knee arthroscopy) and 29805 (diagnostic shoulder arthroscopy) were examined. Geographical differences in commercial payer reimbursements were considered. The 5 surgeons who submitted data for this study practice in different parts of the United States—the Northeast, the Mid-Atlantic, the Southeast, the Midwest, and the West Coast. Similarly, the costs of outpatient and inpatient MRI and MRA were reported by each physician based on regional rates. MRI reimbursement was considered only if the MRI magnet was 1.5 Tesla or stronger.

Results

We reviewed 200 (175 knee, 25 shoulder) in-office diagnostic needle arthroscopies of patients with commercial insurances. Average reimbursement was calculated across all commercial payers for both knee and shoulder arthroscopies (Figure 2).

For in-office diagnostic needle arthroscopy of the knee, average reimbursement was $628.92 (range, $340-$1391). For in-office diagnostic needle arthroscopy of the shoulder, average reimbursement was $492.38 (range, $471-$593). Outpatient MRI without contrast of the knee or shoulder averaged $1047 (range, $565-$2100) (Figure 3).

Discussion

Over the past decade, the combination of health and economics has often driven patient care and consumer demand. With rising deductibles and variations in secondary insurance carriers, patients often base healthcare decisions on their financial impact. Conversely, physicians are often in the difficult position of treating patients who are hesitant to obtain medical imaging out of financial concern. In addition, physicians and patients routinely are concerned about delays in care and timely reporting of test results. A patient’s ability to quickly obtain test results and start a course of definitive treatment may affect the patient’s perception of the overall healthcare experience with the physician, as has been noted in popular healthcare polls, such as Press-Ganey.¹³

Diagnostic needle arthroscopy performed in an office can yield a cost saving over MRI. Our review revealed in-office needle arthroscopy of the knee provided an average cost saving of $418.08 over standard MRI performed in an outpatient facility (Figure 3). That saving more than doubled, to $961.08, when MRI was performed in a hospital. Similarly, in-office needle arthroscopy of the shoulder provided an average cost saving of $554.62 over standard MRI. This saving also increased substantially, to $1097.62, over hospital MRI. An additional cost saving of $100 to $350 was found for knee or shoulder diagnostic needle arthroscopy over MRA.

Other factors affect the economic benefit of diagnostic needle arthroscopy over standard MRI. Having the procedure performed the same day as the presenting office visit can save the patient time and allow the physician to create a medical treatment plan sooner. In addition, the patient (and the insurance company) can save costs by avoiding a later office visit for review of MRI findings. Time spent going to MRI follow-up visits potentially can be analyzed as lost wages or as time lost from other segments of life. For the patient, this time can be defined as value hours. Last, there is a cost saving in avoiding nonoperative treatments in cases in which the initial definitive diagnosis would have called for surgical intervention. Accordingly, for patients who cannot undergo MRI, obtaining information on intra-articular pathology in the office may also decrease unnecessary "traditional" diagnostic arthroscopy in the operating room. Therefore, patients who do not require true formal arthroscopy to determine lack of pertinent intra-articular pathology can avoid unnecessary anesthesia, time off work, and associated healthcare expenses.

This study had several limitations. First, evaluating more cases would have increased the strength of the findings. Second, the large number of knee cases relative to shoulder cases may have been a by-product of the practice makeup of the surgeons rather than a matter of preference with this relatively new technology. However, the significant gap in cost savings between needle arthroscope and MRI cannot be discounted, and it provides a window on the potential cost savings the healthcare system can realize. Furthermore, analysis of payments made by the commercial payers in each state may have revealed a reimbursement fluctuation. The largest challenge in this study was the extreme variation in MRI costs. According to the literature, MRI of the upper or lower extremity ranges in cost from $500 to $4000.⁴ In addition, this cost is often negotiated between the patient and the MRI facility if the patient is willing to work outside insurance, which potentially can alter the overall average MRI cost.

The last points to consider are the reliability of users and the reproducibility of in-office diagnostic needle arthroscopy. Much as with true surgical arthroscopy and other diagnostic imaging practices, this procedure has a learning curve. We know that the number of successful diagnoses will increase with training and repetition, but so far there are no data on the number of procedures needed for proficiency. However, diagnostic needle arthroscopy images are of high quality and are static across users (Figures 5A, 5B). By contrast, the quality of MRI in the United States varies with the quality of the magnets used in individual facilities.

Conclusion

In-office diagnostic needle arthroscopy is a cost-effective and reproducible procedure with potential cost and quality-of-life benefits for commercial payers and patients. Although further study of long-term cost savings for the health care system is needed, significant value was realized in this 200-patient retrospective review. Minimum savings of $418 and $554.62 were realized for noncontrast knee and shoulder MRIs, respectively, in independent facilities. Those cost savings more than doubled in hospital-based facilities: $961.08 and $1097.62, respectively, for knee and shoulder noncontrast MRIs.

For More on In-office Arthroscopy...

Don’t miss Dr. Sean McMillan’s “Innovative Technique Update: In-Office Arthroscopy: My Technique and Results” at the upcoming Innovative Techniques® Knee, Hip, and Shoulder Course in Las Vegas. 29.5 CME/MOC available. Learn more

Take-Home Points

• In-office diagnostic needle arthroscopy is a minimally invasive, rapid method for identification of intra-articular joint pathology.
• Cost savings of a significant value can be realized to both the patient and healthcare system via small-bore needle arthroscopy as opposed to MRI.
• Diagnostic needle arthroscopy can lead to quicker identification of pathology than MRI.
• Diagnostic needle arthroscopy can reduce the number of undue "formal" surgical diagnostic arthroscopies.
• Standardization of image quality of small bore arthroscopy may pose benefits to the variable quality of MRI.

Patient satisfaction and healthcare costs have taken a leading role in today’s health care market. Patient satisfaction, often categorized as the "patient experience," can be measured on numerous levels, such as access to healthcare professionals and diagnostic testing, wait time for appointments, and timely test results. Furthermore, patients’ having a full understanding of their pathology and treatment options may correlate with their overall satisfaction. Some metrics are subjective, but procedure costs are objective.

The algorithm for treating patients who present with knee or shoulder pathology to an orthopedic office involves taking a thorough history, performing a physical examination, and, in many cases, obtaining diagnostic imaging. After arriving at a diagnosis, the physician plans the patient’s treatment. In most cases in which magnetic resonance imaging (MRI) is required, the process can take 2 to 3 weeks.¹

Surgical knee arthroscopy is one of the most common procedures in the United States.^2,3 Worldwide, more than 2 million knee arthroscopies are performed yearly.⁴ For most procedures, the decision to treat is based on physical examination findings, and the diagnosis is confirmed with MRI. MRI has 86% sensitivity and 91% specificity for diagnosing ligamentous and meniscal tears.⁵ However, regular use of MRI has led to increased healthcare expenditures and a larger financial burden for patients, which can delay diagnosis.⁶

Since 2000, MRI use in the United States has risen significantly—by 10% over a 10-year period.⁷ According to a 2013 population analysis, 107 in 1000 US inhabitants had an MRI yearly.⁸

MRI costs vary widely because of several factors, including state/regional consideration, scanning in a hospital or an independent facility, and use of contrast and arthrography. In a 2017 study of the variation in noncontrast MRI costs at 71 hospitals and 26 independent facilities in Iowa, Westermann and colleagues⁹ found that, excluding radiologist interpretation fees, the mean MRI technical component cost to consumers was US $1874 (SD, $694; range, $500-$4000).

Patient factors may preclude use of MRI (Table).

Small-bore needle arthroscopy is a cost-effective alternative diagnostic tool with efficacy and accuracy similar to those of MRI and standard arthroscopy for intra-articular pathologies.^6,11 The procedure is performed with a disposable handpiece equipped with an internal light source and optics; this handpiece attaches to a reusable tablet for ease of transportation and visualization (Figure 1).

In 2014, Voigt and colleagues⁶ reported a significant net healthcare system cost saving with use of a small-needle arthroscope for diagnostic testing. The saving was estimated at $115 million to $177 million for simple isolation of medial meniscus pathology—or, more specifically, for appropriate care after more accurate visualization with the diagnostic needle arthroscope coupled with a decrease in false positives compared with MRI use. Other factors include the economic impact of the patient’s lost work hours, often associated with the time off needed for the MRI and for the follow-up visit for review of results.

Methods

We retrospectively reviewed the patient charts for 200 in-office knee and shoulder diagnostic needle arthroscopies performed by 5 surgeons over a 12-month period and examined the costs. Medicare, Medicaid, worker’s compensation, self-pay, and motor vehicle cases were excluded to provide uniformity across commercial insurance payers. Only the reimbursement amounts for Current Procedural Terminology codes 29870 (diagnostic knee arthroscopy) and 29805 (diagnostic shoulder arthroscopy) were examined. Geographical differences in commercial payer reimbursements were considered. The 5 surgeons who submitted data for this study practice in different parts of the United States—the Northeast, the Mid-Atlantic, the Southeast, the Midwest, and the West Coast. Similarly, the costs of outpatient and inpatient MRI and MRA were reported by each physician based on regional rates. MRI reimbursement was considered only if the MRI magnet was 1.5 Tesla or stronger.

Results

We reviewed 200 (175 knee, 25 shoulder) in-office diagnostic needle arthroscopies of patients with commercial insurances. Average reimbursement was calculated across all commercial payers for both knee and shoulder arthroscopies (Figure 2).

For in-office diagnostic needle arthroscopy of the knee, average reimbursement was $628.92 (range, $340-$1391). For in-office diagnostic needle arthroscopy of the shoulder, average reimbursement was $492.38 (range, $471-$593). Outpatient MRI without contrast of the knee or shoulder averaged $1047 (range, $565-$2100) (Figure 3).

Discussion

Over the past decade, the combination of health and economics has often driven patient care and consumer demand. With rising deductibles and variations in secondary insurance carriers, patients often base healthcare decisions on their financial impact. Conversely, physicians are often in the difficult position of treating patients who are hesitant to obtain medical imaging out of financial concern. In addition, physicians and patients routinely are concerned about delays in care and timely reporting of test results. A patient’s ability to quickly obtain test results and start a course of definitive treatment may affect the patient’s perception of the overall healthcare experience with the physician, as has been noted in popular healthcare polls, such as Press-Ganey.¹³

Diagnostic needle arthroscopy performed in an office can yield a cost saving over MRI. Our review revealed in-office needle arthroscopy of the knee provided an average cost saving of $418.08 over standard MRI performed in an outpatient facility (Figure 3). That saving more than doubled, to $961.08, when MRI was performed in a hospital. Similarly, in-office needle arthroscopy of the shoulder provided an average cost saving of $554.62 over standard MRI. This saving also increased substantially, to $1097.62, over hospital MRI. An additional cost saving of $100 to $350 was found for knee or shoulder diagnostic needle arthroscopy over MRA.

Other factors affect the economic benefit of diagnostic needle arthroscopy over standard MRI. Having the procedure performed the same day as the presenting office visit can save the patient time and allow the physician to create a medical treatment plan sooner. In addition, the patient (and the insurance company) can save costs by avoiding a later office visit for review of MRI findings. Time spent going to MRI follow-up visits potentially can be analyzed as lost wages or as time lost from other segments of life. For the patient, this time can be defined as value hours. Last, there is a cost saving in avoiding nonoperative treatments in cases in which the initial definitive diagnosis would have called for surgical intervention. Accordingly, for patients who cannot undergo MRI, obtaining information on intra-articular pathology in the office may also decrease unnecessary "traditional" diagnostic arthroscopy in the operating room. Therefore, patients who do not require true formal arthroscopy to determine lack of pertinent intra-articular pathology can avoid unnecessary anesthesia, time off work, and associated healthcare expenses.

This study had several limitations. First, evaluating more cases would have increased the strength of the findings. Second, the large number of knee cases relative to shoulder cases may have been a by-product of the practice makeup of the surgeons rather than a matter of preference with this relatively new technology. However, the significant gap in cost savings between needle arthroscope and MRI cannot be discounted, and it provides a window on the potential cost savings the healthcare system can realize. Furthermore, analysis of payments made by the commercial payers in each state may have revealed a reimbursement fluctuation. The largest challenge in this study was the extreme variation in MRI costs. According to the literature, MRI of the upper or lower extremity ranges in cost from $500 to $4000.⁴ In addition, this cost is often negotiated between the patient and the MRI facility if the patient is willing to work outside insurance, which potentially can alter the overall average MRI cost.

The last points to consider are the reliability of users and the reproducibility of in-office diagnostic needle arthroscopy. Much as with true surgical arthroscopy and other diagnostic imaging practices, this procedure has a learning curve. We know that the number of successful diagnoses will increase with training and repetition, but so far there are no data on the number of procedures needed for proficiency. However, diagnostic needle arthroscopy images are of high quality and are static across users (Figures 5A, 5B). By contrast, the quality of MRI in the United States varies with the quality of the magnets used in individual facilities.

Conclusion

In-office diagnostic needle arthroscopy is a cost-effective and reproducible procedure with potential cost and quality-of-life benefits for commercial payers and patients. Although further study of long-term cost savings for the health care system is needed, significant value was realized in this 200-patient retrospective review. Minimum savings of $418 and $554.62 were realized for noncontrast knee and shoulder MRIs, respectively, in independent facilities. Those cost savings more than doubled in hospital-based facilities: $961.08 and $1097.62, respectively, for knee and shoulder noncontrast MRIs.

For More on In-office Arthroscopy...

Don’t miss Dr. Sean McMillan’s “Innovative Technique Update: In-Office Arthroscopy: My Technique and Results” at the upcoming Innovative Techniques® Knee, Hip, and Shoulder Course in Las Vegas. 29.5 CME/MOC available. Learn more

Take-Home Points

• In-office diagnostic needle arthroscopy is a minimally invasive, rapid method for identification of intra-articular joint pathology.
• Cost savings of a significant value can be realized to both the patient and healthcare system via small-bore needle arthroscopy as opposed to MRI.
• Diagnostic needle arthroscopy can lead to quicker identification of pathology than MRI.
• Diagnostic needle arthroscopy can reduce the number of undue "formal" surgical diagnostic arthroscopies.
• Standardization of image quality of small bore arthroscopy may pose benefits to the variable quality of MRI.

Patient satisfaction and healthcare costs have taken a leading role in today’s health care market. Patient satisfaction, often categorized as the "patient experience," can be measured on numerous levels, such as access to healthcare professionals and diagnostic testing, wait time for appointments, and timely test results. Furthermore, patients’ having a full understanding of their pathology and treatment options may correlate with their overall satisfaction. Some metrics are subjective, but procedure costs are objective.

The algorithm for treating patients who present with knee or shoulder pathology to an orthopedic office involves taking a thorough history, performing a physical examination, and, in many cases, obtaining diagnostic imaging. After arriving at a diagnosis, the physician plans the patient’s treatment. In most cases in which magnetic resonance imaging (MRI) is required, the process can take 2 to 3 weeks.¹

Surgical knee arthroscopy is one of the most common procedures in the United States.^2,3 Worldwide, more than 2 million knee arthroscopies are performed yearly.⁴ For most procedures, the decision to treat is based on physical examination findings, and the diagnosis is confirmed with MRI. MRI has 86% sensitivity and 91% specificity for diagnosing ligamentous and meniscal tears.⁵ However, regular use of MRI has led to increased healthcare expenditures and a larger financial burden for patients, which can delay diagnosis.⁶

Since 2000, MRI use in the United States has risen significantly—by 10% over a 10-year period.⁷ According to a 2013 population analysis, 107 in 1000 US inhabitants had an MRI yearly.⁸

MRI costs vary widely because of several factors, including state/regional consideration, scanning in a hospital or an independent facility, and use of contrast and arthrography. In a 2017 study of the variation in noncontrast MRI costs at 71 hospitals and 26 independent facilities in Iowa, Westermann and colleagues⁹ found that, excluding radiologist interpretation fees, the mean MRI technical component cost to consumers was US $1874 (SD, $694; range, $500-$4000).

Patient factors may preclude use of MRI (Table).

Small-bore needle arthroscopy is a cost-effective alternative diagnostic tool with efficacy and accuracy similar to those of MRI and standard arthroscopy for intra-articular pathologies.^6,11 The procedure is performed with a disposable handpiece equipped with an internal light source and optics; this handpiece attaches to a reusable tablet for ease of transportation and visualization (Figure 1).

In 2014, Voigt and colleagues⁶ reported a significant net healthcare system cost saving with use of a small-needle arthroscope for diagnostic testing. The saving was estimated at $115 million to $177 million for simple isolation of medial meniscus pathology—or, more specifically, for appropriate care after more accurate visualization with the diagnostic needle arthroscope coupled with a decrease in false positives compared with MRI use. Other factors include the economic impact of the patient’s lost work hours, often associated with the time off needed for the MRI and for the follow-up visit for review of results.

Methods

We retrospectively reviewed the patient charts for 200 in-office knee and shoulder diagnostic needle arthroscopies performed by 5 surgeons over a 12-month period and examined the costs. Medicare, Medicaid, worker’s compensation, self-pay, and motor vehicle cases were excluded to provide uniformity across commercial insurance payers. Only the reimbursement amounts for Current Procedural Terminology codes 29870 (diagnostic knee arthroscopy) and 29805 (diagnostic shoulder arthroscopy) were examined. Geographical differences in commercial payer reimbursements were considered. The 5 surgeons who submitted data for this study practice in different parts of the United States—the Northeast, the Mid-Atlantic, the Southeast, the Midwest, and the West Coast. Similarly, the costs of outpatient and inpatient MRI and MRA were reported by each physician based on regional rates. MRI reimbursement was considered only if the MRI magnet was 1.5 Tesla or stronger.

Results

We reviewed 200 (175 knee, 25 shoulder) in-office diagnostic needle arthroscopies of patients with commercial insurances. Average reimbursement was calculated across all commercial payers for both knee and shoulder arthroscopies (Figure 2).

For in-office diagnostic needle arthroscopy of the knee, average reimbursement was $628.92 (range, $340-$1391). For in-office diagnostic needle arthroscopy of the shoulder, average reimbursement was $492.38 (range, $471-$593). Outpatient MRI without contrast of the knee or shoulder averaged $1047 (range, $565-$2100) (Figure 3).

Discussion

Over the past decade, the combination of health and economics has often driven patient care and consumer demand. With rising deductibles and variations in secondary insurance carriers, patients often base healthcare decisions on their financial impact. Conversely, physicians are often in the difficult position of treating patients who are hesitant to obtain medical imaging out of financial concern. In addition, physicians and patients routinely are concerned about delays in care and timely reporting of test results. A patient’s ability to quickly obtain test results and start a course of definitive treatment may affect the patient’s perception of the overall healthcare experience with the physician, as has been noted in popular healthcare polls, such as Press-Ganey.¹³

Diagnostic needle arthroscopy performed in an office can yield a cost saving over MRI. Our review revealed in-office needle arthroscopy of the knee provided an average cost saving of $418.08 over standard MRI performed in an outpatient facility (Figure 3). That saving more than doubled, to $961.08, when MRI was performed in a hospital. Similarly, in-office needle arthroscopy of the shoulder provided an average cost saving of $554.62 over standard MRI. This saving also increased substantially, to $1097.62, over hospital MRI. An additional cost saving of $100 to $350 was found for knee or shoulder diagnostic needle arthroscopy over MRA.

Other factors affect the economic benefit of diagnostic needle arthroscopy over standard MRI. Having the procedure performed the same day as the presenting office visit can save the patient time and allow the physician to create a medical treatment plan sooner. In addition, the patient (and the insurance company) can save costs by avoiding a later office visit for review of MRI findings. Time spent going to MRI follow-up visits potentially can be analyzed as lost wages or as time lost from other segments of life. For the patient, this time can be defined as value hours. Last, there is a cost saving in avoiding nonoperative treatments in cases in which the initial definitive diagnosis would have called for surgical intervention. Accordingly, for patients who cannot undergo MRI, obtaining information on intra-articular pathology in the office may also decrease unnecessary "traditional" diagnostic arthroscopy in the operating room. Therefore, patients who do not require true formal arthroscopy to determine lack of pertinent intra-articular pathology can avoid unnecessary anesthesia, time off work, and associated healthcare expenses.

This study had several limitations. First, evaluating more cases would have increased the strength of the findings. Second, the large number of knee cases relative to shoulder cases may have been a by-product of the practice makeup of the surgeons rather than a matter of preference with this relatively new technology. However, the significant gap in cost savings between needle arthroscope and MRI cannot be discounted, and it provides a window on the potential cost savings the healthcare system can realize. Furthermore, analysis of payments made by the commercial payers in each state may have revealed a reimbursement fluctuation. The largest challenge in this study was the extreme variation in MRI costs. According to the literature, MRI of the upper or lower extremity ranges in cost from $500 to $4000.⁴ In addition, this cost is often negotiated between the patient and the MRI facility if the patient is willing to work outside insurance, which potentially can alter the overall average MRI cost.

The last points to consider are the reliability of users and the reproducibility of in-office diagnostic needle arthroscopy. Much as with true surgical arthroscopy and other diagnostic imaging practices, this procedure has a learning curve. We know that the number of successful diagnoses will increase with training and repetition, but so far there are no data on the number of procedures needed for proficiency. However, diagnostic needle arthroscopy images are of high quality and are static across users (Figures 5A, 5B). By contrast, the quality of MRI in the United States varies with the quality of the magnets used in individual facilities.

Conclusion

In-office diagnostic needle arthroscopy is a cost-effective and reproducible procedure with potential cost and quality-of-life benefits for commercial payers and patients. Although further study of long-term cost savings for the health care system is needed, significant value was realized in this 200-patient retrospective review. Minimum savings of $418 and $554.62 were realized for noncontrast knee and shoulder MRIs, respectively, in independent facilities. Those cost savings more than doubled in hospital-based facilities: $961.08 and $1097.62, respectively, for knee and shoulder noncontrast MRIs.

For More on In-office Arthroscopy...

Don’t miss Dr. Sean McMillan’s “Innovative Technique Update: In-Office Arthroscopy: My Technique and Results” at the upcoming Innovative Techniques® Knee, Hip, and Shoulder Course in Las Vegas. 29.5 CME/MOC available. Learn more

In this era of biologics for psoriasis with ever-increasing effectiveness and safety as well as patients who have less and less time to visit the physician's office, it would seem that the days of in-office UV treatments would be numbered. However, rumors of the demise of phototherapy may be greatly exaggerated. Phototherapy is still one of the safest and most cost-effective treatments for psoriasis and other dermatoses.1 Its use often is a prerequisite for biologic therapy, and it may be the only therapeutic option for certain subsets of patients, such as children, pregnant women, and immunosuppressed patients. Moreover, narrowband UVB technology has breathed new life into phototherapy, with better efficacy and less long-term risk. Although the utilization of psoralen plus UVA (PUVA) light therapy has indeed decreased over the last 2 decades, the use of UVB therapies continues to increase dramatically.²

Phototherapy Codes

There are 4 chief Current Procedural Terminology (CPT) codes for reporting phototherapy services: (1) 96900: actinotherapy (UV light treatment); (2) 96910: photochemotherapy, tar, and UVB (Goeckerman treatment) or petrolatum and UVB; (3) 96912: photochemotherapy and PUVA; and (4) 96913: photochemotherapy (Goeckerman and/or PUVA) for severe photoresponsive dermatoses requiring at least 4 to 8 hours of care under direct supervision of the physician.³

There is lack of specificity of the CPT code descriptions for phototherapy. Moreover, insurer guidance for documentation for phototherapy is vague to nonexistent, and of course whenever the use of any medical service increases, insurer scrutiny is sure to follow. Therefore, it is not surprising that dermatology practices have reported that private insurers as well as Medicare are auditing medical records for phototherapy treatments.⁴ In fact, recently we have seen a Midwest private insurer demand payment from dermatologists for hundreds of 96910 phototherapy services, which the insurer asserted should have been coded as 96900 because topical therapies were not applied by the dermatology staff. The insurer did not just evaluate medical records but also contacted patients directly and asked how services had been provided. Clearly, more detailed guidance for dermatologists and insurers on documentation and performance standards for each phototherapy service is needed.

Existing coding guidance for phototherapy indicates that actinotherapy (96900) defines the basic service of treating a patient with a UV light unit.⁵ Actinotherapy does not involve application of topical medications while the patient is in the office.

In contrast, photochemotherapy (96910) implies addition of a chemo agent to phototherapy. Despite the somewhat nonspecific nature of the code descriptor, it is apparent that application of photoenhancing agents such as tar, petrolatum, or distillates of petrolatum meet the requirements of 96910. The Coder's Desk Reference for Procedures 2017 describes 96910 as "the physician uses photosensitizing chemicals and light rays to treat skin ailments."⁶ Application of light-enhancing topical products should occur within the office by either staff or the patient. In fact, examination of practice expense data from the Centers for Medicare & Medicaid Services indicated that the 96910 code includes payment for clinical staff time to apply topical products as well as the cost of the topical agent(s).⁷ 

The PUVA code 96912 is defined by the use of photosensitizing psoralen medication, which can be administered topically or orally, followed by UVA treatment. In my experience, PUVA has similar performance standards with in-office application of psoralen, if applicable. If application of topical photoenhancing products occurs outside the office, the requirements of photochemotherapy are not met, and 96900 should be reported. 

The 96913 code defines prolonged phototherapy service with intensive topical therapy requirements and multiple phototherapy sessions per day.³ This code is rarely reported (average of fewer than 100 times in the Medicare population per year), and most insurers do not reimburse this service. 

Protecting Yourself From an Audit

In my experience, review of private insurer audits of phototherapy services has yielded important lessons. First, having a written standard operating procedure in place regarding the performance of phototherapy services and how application of topicals will be handled has been helpful in audit defense. The other key to beating audits for phototherapy services is to have detailed documentation or a flowchart in the medical record regarding the topical agent and the light administration. The medical record should include what topical agent was applied, if any; whether the topical agent was applied in the office; where the topical product was applied; and who applied the topical product. Sometimes topical product application by a physician or staff is not feasible because of patient preference or the site of application. If the patient applied the topical, document that assistance was offered and refused, along with what type of UV light was used and the dosage. Inclusion of these elements in the medical record provides a clear picture of the delivery of the phototherapy service and will aid in responding to medical record audit.

Final Thoughts

Phototherapy is a critical treatment modality that continues to be utilized frequently in the expanding armamentarium of treatments for dermatoses. Phototherapy is performed almost exclusively by dermatologists and allows dermatologists to offer a unique level of care and value in the treatment of skin disease. Careful documentation, a written standard operating procedure, and adherence to proper performance standards will allow dermatologists to be compensated fairly for this important treatment modality and pass audits that are likely to occur.

In this era of biologics for psoriasis with ever-increasing effectiveness and safety as well as patients who have less and less time to visit the physician's office, it would seem that the days of in-office UV treatments would be numbered. However, rumors of the demise of phototherapy may be greatly exaggerated. Phototherapy is still one of the safest and most cost-effective treatments for psoriasis and other dermatoses.1 Its use often is a prerequisite for biologic therapy, and it may be the only therapeutic option for certain subsets of patients, such as children, pregnant women, and immunosuppressed patients. Moreover, narrowband UVB technology has breathed new life into phototherapy, with better efficacy and less long-term risk. Although the utilization of psoralen plus UVA (PUVA) light therapy has indeed decreased over the last 2 decades, the use of UVB therapies continues to increase dramatically.²

Phototherapy Codes

There are 4 chief Current Procedural Terminology (CPT) codes for reporting phototherapy services: (1) 96900: actinotherapy (UV light treatment); (2) 96910: photochemotherapy, tar, and UVB (Goeckerman treatment) or petrolatum and UVB; (3) 96912: photochemotherapy and PUVA; and (4) 96913: photochemotherapy (Goeckerman and/or PUVA) for severe photoresponsive dermatoses requiring at least 4 to 8 hours of care under direct supervision of the physician.³

There is lack of specificity of the CPT code descriptions for phototherapy. Moreover, insurer guidance for documentation for phototherapy is vague to nonexistent, and of course whenever the use of any medical service increases, insurer scrutiny is sure to follow. Therefore, it is not surprising that dermatology practices have reported that private insurers as well as Medicare are auditing medical records for phototherapy treatments.⁴ In fact, recently we have seen a Midwest private insurer demand payment from dermatologists for hundreds of 96910 phototherapy services, which the insurer asserted should have been coded as 96900 because topical therapies were not applied by the dermatology staff. The insurer did not just evaluate medical records but also contacted patients directly and asked how services had been provided. Clearly, more detailed guidance for dermatologists and insurers on documentation and performance standards for each phototherapy service is needed.

Existing coding guidance for phototherapy indicates that actinotherapy (96900) defines the basic service of treating a patient with a UV light unit.⁵ Actinotherapy does not involve application of topical medications while the patient is in the office.

In contrast, photochemotherapy (96910) implies addition of a chemo agent to phototherapy. Despite the somewhat nonspecific nature of the code descriptor, it is apparent that application of photoenhancing agents such as tar, petrolatum, or distillates of petrolatum meet the requirements of 96910. The Coder's Desk Reference for Procedures 2017 describes 96910 as "the physician uses photosensitizing chemicals and light rays to treat skin ailments."⁶ Application of light-enhancing topical products should occur within the office by either staff or the patient. In fact, examination of practice expense data from the Centers for Medicare & Medicaid Services indicated that the 96910 code includes payment for clinical staff time to apply topical products as well as the cost of the topical agent(s).⁷ 

The PUVA code 96912 is defined by the use of photosensitizing psoralen medication, which can be administered topically or orally, followed by UVA treatment. In my experience, PUVA has similar performance standards with in-office application of psoralen, if applicable. If application of topical photoenhancing products occurs outside the office, the requirements of photochemotherapy are not met, and 96900 should be reported. 

The 96913 code defines prolonged phototherapy service with intensive topical therapy requirements and multiple phototherapy sessions per day.³ This code is rarely reported (average of fewer than 100 times in the Medicare population per year), and most insurers do not reimburse this service. 

Protecting Yourself From an Audit

In my experience, review of private insurer audits of phototherapy services has yielded important lessons. First, having a written standard operating procedure in place regarding the performance of phototherapy services and how application of topicals will be handled has been helpful in audit defense. The other key to beating audits for phototherapy services is to have detailed documentation or a flowchart in the medical record regarding the topical agent and the light administration. The medical record should include what topical agent was applied, if any; whether the topical agent was applied in the office; where the topical product was applied; and who applied the topical product. Sometimes topical product application by a physician or staff is not feasible because of patient preference or the site of application. If the patient applied the topical, document that assistance was offered and refused, along with what type of UV light was used and the dosage. Inclusion of these elements in the medical record provides a clear picture of the delivery of the phototherapy service and will aid in responding to medical record audit.

Final Thoughts

Phototherapy is a critical treatment modality that continues to be utilized frequently in the expanding armamentarium of treatments for dermatoses. Phototherapy is performed almost exclusively by dermatologists and allows dermatologists to offer a unique level of care and value in the treatment of skin disease. Careful documentation, a written standard operating procedure, and adherence to proper performance standards will allow dermatologists to be compensated fairly for this important treatment modality and pass audits that are likely to occur.

In this era of biologics for psoriasis with ever-increasing effectiveness and safety as well as patients who have less and less time to visit the physician's office, it would seem that the days of in-office UV treatments would be numbered. However, rumors of the demise of phototherapy may be greatly exaggerated. Phototherapy is still one of the safest and most cost-effective treatments for psoriasis and other dermatoses.1 Its use often is a prerequisite for biologic therapy, and it may be the only therapeutic option for certain subsets of patients, such as children, pregnant women, and immunosuppressed patients. Moreover, narrowband UVB technology has breathed new life into phototherapy, with better efficacy and less long-term risk. Although the utilization of psoralen plus UVA (PUVA) light therapy has indeed decreased over the last 2 decades, the use of UVB therapies continues to increase dramatically.²

Phototherapy Codes

There are 4 chief Current Procedural Terminology (CPT) codes for reporting phototherapy services: (1) 96900: actinotherapy (UV light treatment); (2) 96910: photochemotherapy, tar, and UVB (Goeckerman treatment) or petrolatum and UVB; (3) 96912: photochemotherapy and PUVA; and (4) 96913: photochemotherapy (Goeckerman and/or PUVA) for severe photoresponsive dermatoses requiring at least 4 to 8 hours of care under direct supervision of the physician.³

There is lack of specificity of the CPT code descriptions for phototherapy. Moreover, insurer guidance for documentation for phototherapy is vague to nonexistent, and of course whenever the use of any medical service increases, insurer scrutiny is sure to follow. Therefore, it is not surprising that dermatology practices have reported that private insurers as well as Medicare are auditing medical records for phototherapy treatments.⁴ In fact, recently we have seen a Midwest private insurer demand payment from dermatologists for hundreds of 96910 phototherapy services, which the insurer asserted should have been coded as 96900 because topical therapies were not applied by the dermatology staff. The insurer did not just evaluate medical records but also contacted patients directly and asked how services had been provided. Clearly, more detailed guidance for dermatologists and insurers on documentation and performance standards for each phototherapy service is needed.

Existing coding guidance for phototherapy indicates that actinotherapy (96900) defines the basic service of treating a patient with a UV light unit.⁵ Actinotherapy does not involve application of topical medications while the patient is in the office.

In contrast, photochemotherapy (96910) implies addition of a chemo agent to phototherapy. Despite the somewhat nonspecific nature of the code descriptor, it is apparent that application of photoenhancing agents such as tar, petrolatum, or distillates of petrolatum meet the requirements of 96910. The Coder's Desk Reference for Procedures 2017 describes 96910 as "the physician uses photosensitizing chemicals and light rays to treat skin ailments."⁶ Application of light-enhancing topical products should occur within the office by either staff or the patient. In fact, examination of practice expense data from the Centers for Medicare & Medicaid Services indicated that the 96910 code includes payment for clinical staff time to apply topical products as well as the cost of the topical agent(s).⁷ 

The PUVA code 96912 is defined by the use of photosensitizing psoralen medication, which can be administered topically or orally, followed by UVA treatment. In my experience, PUVA has similar performance standards with in-office application of psoralen, if applicable. If application of topical photoenhancing products occurs outside the office, the requirements of photochemotherapy are not met, and 96900 should be reported. 

The 96913 code defines prolonged phototherapy service with intensive topical therapy requirements and multiple phototherapy sessions per day.³ This code is rarely reported (average of fewer than 100 times in the Medicare population per year), and most insurers do not reimburse this service. 

Protecting Yourself From an Audit

In my experience, review of private insurer audits of phototherapy services has yielded important lessons. First, having a written standard operating procedure in place regarding the performance of phototherapy services and how application of topicals will be handled has been helpful in audit defense. The other key to beating audits for phototherapy services is to have detailed documentation or a flowchart in the medical record regarding the topical agent and the light administration. The medical record should include what topical agent was applied, if any; whether the topical agent was applied in the office; where the topical product was applied; and who applied the topical product. Sometimes topical product application by a physician or staff is not feasible because of patient preference or the site of application. If the patient applied the topical, document that assistance was offered and refused, along with what type of UV light was used and the dosage. Inclusion of these elements in the medical record provides a clear picture of the delivery of the phototherapy service and will aid in responding to medical record audit.

Final Thoughts

Phototherapy is a critical treatment modality that continues to be utilized frequently in the expanding armamentarium of treatments for dermatoses. Phototherapy is performed almost exclusively by dermatologists and allows dermatologists to offer a unique level of care and value in the treatment of skin disease. Careful documentation, a written standard operating procedure, and adherence to proper performance standards will allow dermatologists to be compensated fairly for this important treatment modality and pass audits that are likely to occur.

An established patient comes into your office with a painful new lesion on the hand. He thinks it may be a wart. You take a focused history of the lesion, do a physical examination, and confirm the diagnosis of verruca vulgaris. You discuss treatment options, risks, and the benefits of treatment, as well as the pathophysiology of warts. The decision is made to proceed that same day with cryosurgical destruction, which is performed. You feel that billing both an office visit with an appended modifier -25 and the benign destruction code 17110 is warranted, but your biller says only the procedure should be reported. Who is correct?

Modifier -25 use has come under increased scrutiny by insurers and regulators. There is a perception that this modifier is frequently used inappropriately or unnecessarily. In fact, the Office of Inspector General reported that 35% of claims using modifier -25 that Medicare allowed did not meet the requirements. The Office of Inspector General has recommended that the “[Centers for Medicare & Medicaid Services] should work with carriers to reduce the number of claims submitted using modifier -25” and “include modifier -25 reviews in their medical review strategies.”¹ Translation: More chart reviews and audits! In my discussions with insurer medical directors, they point to the single diagnosis modifier -25 as likely abused and feel that its use in this context is almost never appropriate. Their audits have been focused on this aspect of dermatologists’ coding. In addition, some private insurers have started to discount reimbursement for office visits billed with modifier -25 by 50% to account for the level of perceived overuse.²

The Current Procedural Terminology description of modifier -25 is relatively clear: Modifier -25 is used to facilitate billing of evaluation and management (E/M) services on the day of a procedure for which separate payment may be made.³ This modifier indicates that a significant, separately identifiable E/M service was performed by the same physician on the day of a procedure. To appropriately bill both the E/M service and the procedure, the physician must indicate that the patient’s condition required an E/M service “above and beyond the usual pre- and post-operative work of a procedure.”⁴ However, it is largely left up to the physician to decide what constitutes the significant, separately identifiable E/M service.

As dermatologists, we all report modifier -25 appropriately as part of our daily practice. Performance of a medically necessary procedure on the same day as an E/M service generally is done to facilitate a prompt diagnosis or streamline treatment of a complex condition. Providing distinct medically necessary services on the same date allows physicians to provide effective and efficient high-quality care, in many cases saving patients a return visit. The most common scenario for using modifier -25 involves multiple concerns and multiple diagnoses, some of which are not associated with a procedure(s) that is performed on the same date of service. With multiple diagnoses, it is straightforward to demonstrate the separate E/M service associated with the nonprocedure-related diagnosis code(s); however, with one diagnosis for both the office visit and the procedure, clear documentation of the separate and identifiable E/M service is critical and is dependent on understanding what is included in the global surgical package.

Insurer payment for procedures includes local or topical anesthesia, the surgical service/procedure itself, immediate postoperative care including dictating the operative note, meeting/discussing the patient’s procedure with family and other physicians, evaluating the patient in postanesthesia/recovery area, and writing orders for the patient. This group of services is called the global surgical package. For minor procedures (ie, those with either 0- or 10-day global periods), the surgical package also includes same-day E/M associated with the decision to perform surgery. An appropriate history and physical examination, as well as the discussion of differential diagnosis, treatment options, and risk and benefits of treatments, are all included in the payment of a minor procedure itself. Therefore, if an E/M service is performed on the same day as a minor procedure to decide whether to proceed with the minor surgical procedure, this E/M service cannot be separately reported. Moreover, the fact that the patient is new to the physician is not sufficient to allow reporting of an E/M service with such a minor procedure. For major procedures (ie, those with 90-day postoperative periods), the decision for surgery is excluded from the global surgical package.

Therefore, it is clear that the clinical scenario for verruca vulgaris treatment as described at the start of this article does not meet criteria for an office visit billed in addition to the destruction. The E/M services performed prior to the patient’s verruca vulgaris treatment are integral to and necessary for the decision to perform the procedure. Making and confirming the diagnosis of a condition or lesion prior to a procedure either by physical evaluation or by interpretation of a pathology report is part of the evaluation required to make the decision to proceed with a particular procedure.

There are clinical scenarios in which a physician can support additional E/M services beyond that of the procedure with just one diagnosis. If a patient presents with warts on the hand and face with resultant cryosurgical destruction done on the hand and a prescription for imiquimod to be used on the face to induce immunologic clearance of viral infection and decrease the risk of scarring, it is clear that a significant and separately identifiable E/M service exists. The evaluation of the facial warts and the prescription of medication and discussion of the risks, benefits, and therapeutic effects of that prescription is definitely distinct from the procedure. Similarly, if an evaluation of a patient with a rash results in only a diagnostic biopsy with no separate cognitive services other than the decision to perform the biopsy, an office visit charge in addition to the biopsy charge would not be warranted. However, if in addition to the biopsy the rash also is treated with topical or systemic steroids because of pruritus or a more extensive evaluation for systemic complications is required, an office visit charge is appropriate.

The frequent use of modifier -25 is a critical part of a high-quality and cost-effective dermatology practice. Same-day performance of E/M services and minor procedures allows for more rapid and efficient diagnosis and treatment of various conditions as well as minimizing unnecessary office visits. However, modifier -25 use, particularly in the context of the same diagnosis for the office visit and the procedure, is under intense insurer scrutiny. Careful and complete documentation of the additional E/M service provided, including the additional history, physical examination results, and treatment considerations above and beyond those typically required by the minor procedure, will reduce the likelihood of redeterminations from reviews and audits. Understanding Medicare guidelines and National Correct Coding Initiative recommendations will help keep the dermatologist out of hot water.⁵

An established patient comes into your office with a painful new lesion on the hand. He thinks it may be a wart. You take a focused history of the lesion, do a physical examination, and confirm the diagnosis of verruca vulgaris. You discuss treatment options, risks, and the benefits of treatment, as well as the pathophysiology of warts. The decision is made to proceed that same day with cryosurgical destruction, which is performed. You feel that billing both an office visit with an appended modifier -25 and the benign destruction code 17110 is warranted, but your biller says only the procedure should be reported. Who is correct?

Modifier -25 use has come under increased scrutiny by insurers and regulators. There is a perception that this modifier is frequently used inappropriately or unnecessarily. In fact, the Office of Inspector General reported that 35% of claims using modifier -25 that Medicare allowed did not meet the requirements. The Office of Inspector General has recommended that the “[Centers for Medicare & Medicaid Services] should work with carriers to reduce the number of claims submitted using modifier -25” and “include modifier -25 reviews in their medical review strategies.”¹ Translation: More chart reviews and audits! In my discussions with insurer medical directors, they point to the single diagnosis modifier -25 as likely abused and feel that its use in this context is almost never appropriate. Their audits have been focused on this aspect of dermatologists’ coding. In addition, some private insurers have started to discount reimbursement for office visits billed with modifier -25 by 50% to account for the level of perceived overuse.²

The Current Procedural Terminology description of modifier -25 is relatively clear: Modifier -25 is used to facilitate billing of evaluation and management (E/M) services on the day of a procedure for which separate payment may be made.³ This modifier indicates that a significant, separately identifiable E/M service was performed by the same physician on the day of a procedure. To appropriately bill both the E/M service and the procedure, the physician must indicate that the patient’s condition required an E/M service “above and beyond the usual pre- and post-operative work of a procedure.”⁴ However, it is largely left up to the physician to decide what constitutes the significant, separately identifiable E/M service.

As dermatologists, we all report modifier -25 appropriately as part of our daily practice. Performance of a medically necessary procedure on the same day as an E/M service generally is done to facilitate a prompt diagnosis or streamline treatment of a complex condition. Providing distinct medically necessary services on the same date allows physicians to provide effective and efficient high-quality care, in many cases saving patients a return visit. The most common scenario for using modifier -25 involves multiple concerns and multiple diagnoses, some of which are not associated with a procedure(s) that is performed on the same date of service. With multiple diagnoses, it is straightforward to demonstrate the separate E/M service associated with the nonprocedure-related diagnosis code(s); however, with one diagnosis for both the office visit and the procedure, clear documentation of the separate and identifiable E/M service is critical and is dependent on understanding what is included in the global surgical package.

Insurer payment for procedures includes local or topical anesthesia, the surgical service/procedure itself, immediate postoperative care including dictating the operative note, meeting/discussing the patient’s procedure with family and other physicians, evaluating the patient in postanesthesia/recovery area, and writing orders for the patient. This group of services is called the global surgical package. For minor procedures (ie, those with either 0- or 10-day global periods), the surgical package also includes same-day E/M associated with the decision to perform surgery. An appropriate history and physical examination, as well as the discussion of differential diagnosis, treatment options, and risk and benefits of treatments, are all included in the payment of a minor procedure itself. Therefore, if an E/M service is performed on the same day as a minor procedure to decide whether to proceed with the minor surgical procedure, this E/M service cannot be separately reported. Moreover, the fact that the patient is new to the physician is not sufficient to allow reporting of an E/M service with such a minor procedure. For major procedures (ie, those with 90-day postoperative periods), the decision for surgery is excluded from the global surgical package.

Therefore, it is clear that the clinical scenario for verruca vulgaris treatment as described at the start of this article does not meet criteria for an office visit billed in addition to the destruction. The E/M services performed prior to the patient’s verruca vulgaris treatment are integral to and necessary for the decision to perform the procedure. Making and confirming the diagnosis of a condition or lesion prior to a procedure either by physical evaluation or by interpretation of a pathology report is part of the evaluation required to make the decision to proceed with a particular procedure.

There are clinical scenarios in which a physician can support additional E/M services beyond that of the procedure with just one diagnosis. If a patient presents with warts on the hand and face with resultant cryosurgical destruction done on the hand and a prescription for imiquimod to be used on the face to induce immunologic clearance of viral infection and decrease the risk of scarring, it is clear that a significant and separately identifiable E/M service exists. The evaluation of the facial warts and the prescription of medication and discussion of the risks, benefits, and therapeutic effects of that prescription is definitely distinct from the procedure. Similarly, if an evaluation of a patient with a rash results in only a diagnostic biopsy with no separate cognitive services other than the decision to perform the biopsy, an office visit charge in addition to the biopsy charge would not be warranted. However, if in addition to the biopsy the rash also is treated with topical or systemic steroids because of pruritus or a more extensive evaluation for systemic complications is required, an office visit charge is appropriate.

The frequent use of modifier -25 is a critical part of a high-quality and cost-effective dermatology practice. Same-day performance of E/M services and minor procedures allows for more rapid and efficient diagnosis and treatment of various conditions as well as minimizing unnecessary office visits. However, modifier -25 use, particularly in the context of the same diagnosis for the office visit and the procedure, is under intense insurer scrutiny. Careful and complete documentation of the additional E/M service provided, including the additional history, physical examination results, and treatment considerations above and beyond those typically required by the minor procedure, will reduce the likelihood of redeterminations from reviews and audits. Understanding Medicare guidelines and National Correct Coding Initiative recommendations will help keep the dermatologist out of hot water.⁵

An established patient comes into your office with a painful new lesion on the hand. He thinks it may be a wart. You take a focused history of the lesion, do a physical examination, and confirm the diagnosis of verruca vulgaris. You discuss treatment options, risks, and the benefits of treatment, as well as the pathophysiology of warts. The decision is made to proceed that same day with cryosurgical destruction, which is performed. You feel that billing both an office visit with an appended modifier -25 and the benign destruction code 17110 is warranted, but your biller says only the procedure should be reported. Who is correct?

Modifier -25 use has come under increased scrutiny by insurers and regulators. There is a perception that this modifier is frequently used inappropriately or unnecessarily. In fact, the Office of Inspector General reported that 35% of claims using modifier -25 that Medicare allowed did not meet the requirements. The Office of Inspector General has recommended that the “[Centers for Medicare & Medicaid Services] should work with carriers to reduce the number of claims submitted using modifier -25” and “include modifier -25 reviews in their medical review strategies.”¹ Translation: More chart reviews and audits! In my discussions with insurer medical directors, they point to the single diagnosis modifier -25 as likely abused and feel that its use in this context is almost never appropriate. Their audits have been focused on this aspect of dermatologists’ coding. In addition, some private insurers have started to discount reimbursement for office visits billed with modifier -25 by 50% to account for the level of perceived overuse.²

The Current Procedural Terminology description of modifier -25 is relatively clear: Modifier -25 is used to facilitate billing of evaluation and management (E/M) services on the day of a procedure for which separate payment may be made.³ This modifier indicates that a significant, separately identifiable E/M service was performed by the same physician on the day of a procedure. To appropriately bill both the E/M service and the procedure, the physician must indicate that the patient’s condition required an E/M service “above and beyond the usual pre- and post-operative work of a procedure.”⁴ However, it is largely left up to the physician to decide what constitutes the significant, separately identifiable E/M service.

As dermatologists, we all report modifier -25 appropriately as part of our daily practice. Performance of a medically necessary procedure on the same day as an E/M service generally is done to facilitate a prompt diagnosis or streamline treatment of a complex condition. Providing distinct medically necessary services on the same date allows physicians to provide effective and efficient high-quality care, in many cases saving patients a return visit. The most common scenario for using modifier -25 involves multiple concerns and multiple diagnoses, some of which are not associated with a procedure(s) that is performed on the same date of service. With multiple diagnoses, it is straightforward to demonstrate the separate E/M service associated with the nonprocedure-related diagnosis code(s); however, with one diagnosis for both the office visit and the procedure, clear documentation of the separate and identifiable E/M service is critical and is dependent on understanding what is included in the global surgical package.

Insurer payment for procedures includes local or topical anesthesia, the surgical service/procedure itself, immediate postoperative care including dictating the operative note, meeting/discussing the patient’s procedure with family and other physicians, evaluating the patient in postanesthesia/recovery area, and writing orders for the patient. This group of services is called the global surgical package. For minor procedures (ie, those with either 0- or 10-day global periods), the surgical package also includes same-day E/M associated with the decision to perform surgery. An appropriate history and physical examination, as well as the discussion of differential diagnosis, treatment options, and risk and benefits of treatments, are all included in the payment of a minor procedure itself. Therefore, if an E/M service is performed on the same day as a minor procedure to decide whether to proceed with the minor surgical procedure, this E/M service cannot be separately reported. Moreover, the fact that the patient is new to the physician is not sufficient to allow reporting of an E/M service with such a minor procedure. For major procedures (ie, those with 90-day postoperative periods), the decision for surgery is excluded from the global surgical package.

Therefore, it is clear that the clinical scenario for verruca vulgaris treatment as described at the start of this article does not meet criteria for an office visit billed in addition to the destruction. The E/M services performed prior to the patient’s verruca vulgaris treatment are integral to and necessary for the decision to perform the procedure. Making and confirming the diagnosis of a condition or lesion prior to a procedure either by physical evaluation or by interpretation of a pathology report is part of the evaluation required to make the decision to proceed with a particular procedure.

There are clinical scenarios in which a physician can support additional E/M services beyond that of the procedure with just one diagnosis. If a patient presents with warts on the hand and face with resultant cryosurgical destruction done on the hand and a prescription for imiquimod to be used on the face to induce immunologic clearance of viral infection and decrease the risk of scarring, it is clear that a significant and separately identifiable E/M service exists. The evaluation of the facial warts and the prescription of medication and discussion of the risks, benefits, and therapeutic effects of that prescription is definitely distinct from the procedure. Similarly, if an evaluation of a patient with a rash results in only a diagnostic biopsy with no separate cognitive services other than the decision to perform the biopsy, an office visit charge in addition to the biopsy charge would not be warranted. However, if in addition to the biopsy the rash also is treated with topical or systemic steroids because of pruritus or a more extensive evaluation for systemic complications is required, an office visit charge is appropriate.

The frequent use of modifier -25 is a critical part of a high-quality and cost-effective dermatology practice. Same-day performance of E/M services and minor procedures allows for more rapid and efficient diagnosis and treatment of various conditions as well as minimizing unnecessary office visits. However, modifier -25 use, particularly in the context of the same diagnosis for the office visit and the procedure, is under intense insurer scrutiny. Careful and complete documentation of the additional E/M service provided, including the additional history, physical examination results, and treatment considerations above and beyond those typically required by the minor procedure, will reduce the likelihood of redeterminations from reviews and audits. Understanding Medicare guidelines and National Correct Coding Initiative recommendations will help keep the dermatologist out of hot water.⁵

All physicians will see changes in reimbursement in 2017. A new president with a new agenda makes for an interesting time ahead for health care in the United States. However, in this time of flux, there is one constant: the Final Rule, an informal term for the annual update on how the Medicare system will function and how much you will get paid for what you do.¹ The document is 393 pages and outlines what is new in the Medicare system, with lots of supplements giving granular details about physician work, overhead, and supply and labor costs. In this column, I have taken the liberty of dissecting the Final Rule for you and to bring attention to its high and low points for dermatologists.

Changes in Relative Value Units

The conversion factor has gone up, meaning you will be paid a bit more this year for what you do; it is not enough to account for inflation or the increasing cost of unfunded mandates, but it is better than nothing. Although the conversion factor was $35.8043 in 2016, it increased by more than 0.2% on January 1, 2017, to $35.8887.¹ How is this conversion factor calculated? We go up 0.5% due to MACRA (Medicare Access and CHIP Reauthorization Act), down 0.013% due to budget neutrality, down 0.07% due to multiple procedure payment reduction changes, and down another 0.18% due to the misvalued code target.¹ The misvalued code target is related to targets established by statute for 2016 to 2018 and payment rates are reduced across the board if they are not met.

If payments suffer from reductions in work value, they may not happen all at once. If the Centers for Medicare & Medicaid Services (CMS) reduce total relative value units (RVUs) by more than 20%, reductions will take place over at least 2 years with a single year drop maximum of 19%.¹ Unfortunately, such limits do not apply to revised codes, which can take as big a hit as the CMS cares to make.

Changes to Global Periods

In 2015, we learned that 10- and 90-day global periods would be eliminated in 2017 and 2018, respectively, with great concern on the part of the government about the number and level of evaluation and management services embedded in these codes. The implementation of global policy elimination was prohibited by MACRA and the CMS was required to develop and implement a process to gather data on services furnished in the global period from a representative sample of physicians, which they will use to value surgical services beginningin 2019.¹ The CMS decided to capture this data with a new set of time-based G codes (which would be onerous for all practicing physicians), not just the unlucky folks who were to be the sample mandated under MACRA.² During the comment period, it became obvious to the CMS that this concept was flawed for many reasons and it decided to hold a town hall meeting at the CMS headquarters on August 25, 2016, on data collection on resources used in furnishing global services in which 90 minutes of live testimony in the morning was followed by another 90 minutes by telephone in the afternoon.³ This meeting, which I attended, resulted in the CMS changing the all-practitioner reporting program to a specified sample with others allowed to opt in. Practitioners in groups of less than 10 are exempt, and only physicians in Florida, Kentucky, Louisiana, Nevada, New Jersey, North Dakota, Ohio, Oregon, and Rhode Island must capture data beginning in July 2017.¹ These data only have to be captured on codes that are used by more than 100 practitioners and are furnished at least 10,000 times or have allowed charges of greater than $10,000,000 annually. If you are lucky enough to live in one of the testing states, you must start on July 1 but can start before July 1 if you wish. Practitioners in smaller practices or in other geographic areas are encouraged to report data if feasible but are not required to do so. Current Procedural Terminology (CPT) code 99024 will be used for reporting postoperative services rather than the proposed onerous set of G codes, and reporting will not be required for preoperative visits included in the global package or for services not related to the patient’s visit.

Changes to Chronic Care Management

There are new and modified chronic care management codes that are not of use to you unless you are the primary provider for the patient and you and the patient meet multiple stringent requirements.⁴ The patient must have multiple illnesses, use multiple medications, be unable to perform activities of daily living, require a caregiver, and/or have repeat admissions or emergency department visits. Typical adult patients who receive complex chronic care management services are treated with 3 or more prescription medications and may be receiving other types of therapeutic interventions (eg, physical therapy, occupational therapy). Typical pediatric patients receive 3 or more therapeutic interventions (eg, medications, nutritional support, respiratory therapy). All patients have 2 or more chronic continuous or episodic health conditions that are expected to last at least 12 months or until the death of the patient and place the patient at serious risk for death, acute exacerbation/decompensation, or functional decline.⁴

Changes to Moderate Sedation Codes

The economic value of providing moderate sedation (eg, drug-induced depression of consciousness during which patients respond purposefully to verbal commands, either alone or accompanied by light tactile stimulation) used to be embedded in a variety of CPT codes, which is no longer the case in 2017. Diazepam or similar drugs swallowed or dissolved under the tongue are not included. The new CPT codes 99151, 99152, 99153, 99155, 99156, and 99157 are not to be used to report administration of medications for pain control or minimal sedation (anxiolysis). An independent trained observer, an individual who is qualified to monitor the patient during the procedure and who has no other duties (eg, assisting at surgery) during the procedure, must be present. If you are thinking of using these codes, read the entire section in the CPT manual,⁴ check your state laws, and consult your malpractice carrier and perhaps even your health care attorney.

Changes to Nail Procedure Codes

Current Procedural Terminology code 11752 (excision of nail and nail matrix, partial or complete [eg, ingrown or deformed nail], for permanent removal; with amputation of tuft of distal phalanx) is now gone, while base code 11750 remains. If you are doing nail surgery and removing underlying bone, instead use code 26236 (partial excision [craterization, saucerization, or diaphysectomy] bone [eg, osteomyelitis]; distal phalanx of finger), 28124 (partial excision [craterization, saucerization, sequestrectomy, or diaphysectomy] bone [eg, osteomyelitis or bossing]; phalanx of toe), or other codes in the same section of the CPT manual if they more precisely describe the procedure performed.

Changes to Slide Consultation Codes

The slide consultation codes 88321 (consultation and report on referred slides prepared elsewhere), 88323 (consultation and report on referred material requiring preparation of slides), and 88325 (consultation, comprehensive, with review of records and specimens, with report on referred material) were revalued this year, with the first 2 showing no change but the latter showing an increase in value from 2.50 to 2.85 RVUs.¹ None are meant to be routine. If you have every slide looked at by someone else for “quality assurance reasons,” the consultation is not reportable. If you use these consultation codes too often, the CMS might have concerns about fraud and abuse. Visit http://data.cms.gov to see how you compare to your peers.

Changes to Reflectance Confocal Microscopy Codes

Reflectance confocal microscopy had new codes for 2016, which were carrier priced, and in 2017 they have real RVUs per the CMS. The payments for these codes have a national average reimbursement of $161.85 for 96931 (reflectance confocal microscopy for cellular and subcellular imaging of skin; image acquisition and interpretation and report, first lesion), $104.80 for 96932 (image acquisition only, first lesion), and $45.94 for 96933 (interpretation and report only, first lesion).⁵ The respective add-on codes have values of $83.26 for 96934 (image acquisition and interpretation and report, each additional lesion [list separately in addition to code for primary procedure]), $35.17 for 96935 (image acquisition only, each additional lesion [list separately in addition to code for primary procedure]), and $43.78 for 96936 (interpretation and report only, each additional lesion [list separately in addition to code for primary procedure]).

Other Coding Changes

There are a whole bunch of new codes in the “Genomic Sequencing Procedures and Other Molecular Multianalyte Assays” (MMAAs) section of CPT. The important thing for you to remember is these codes are for the laboratory performing the assay to report, not the physician ordering it. There is a new Appendix O for proprietary laboratory analysis MMAAs, including those that do not have a Category I code. These MMAAs are identified in Appendix O by a 4-digit number followed by the letter M.⁴

There are some revisions to psychotherapy codes 90832 to 90847. These codes are outside our scope of practice and should only be used by psychiatrists, social workers, psychologists, or other appropriate mental health workers.

Final Thoughts

It has not been a breakout year for telehealth and we still do not have payment for store-and-forward teledermatology, except in a few designated rural areas. With the advent of the rhetoric we have heard after the presidential election, any speculation on what will happen to the brave new world of the merit-based incentive payment system, alternative payment models, and other regulations are anyone’s guess.

All physicians will see changes in reimbursement in 2017. A new president with a new agenda makes for an interesting time ahead for health care in the United States. However, in this time of flux, there is one constant: the Final Rule, an informal term for the annual update on how the Medicare system will function and how much you will get paid for what you do.¹ The document is 393 pages and outlines what is new in the Medicare system, with lots of supplements giving granular details about physician work, overhead, and supply and labor costs. In this column, I have taken the liberty of dissecting the Final Rule for you and to bring attention to its high and low points for dermatologists.

Changes in Relative Value Units

The conversion factor has gone up, meaning you will be paid a bit more this year for what you do; it is not enough to account for inflation or the increasing cost of unfunded mandates, but it is better than nothing. Although the conversion factor was $35.8043 in 2016, it increased by more than 0.2% on January 1, 2017, to $35.8887.¹ How is this conversion factor calculated? We go up 0.5% due to MACRA (Medicare Access and CHIP Reauthorization Act), down 0.013% due to budget neutrality, down 0.07% due to multiple procedure payment reduction changes, and down another 0.18% due to the misvalued code target.¹ The misvalued code target is related to targets established by statute for 2016 to 2018 and payment rates are reduced across the board if they are not met.

If payments suffer from reductions in work value, they may not happen all at once. If the Centers for Medicare & Medicaid Services (CMS) reduce total relative value units (RVUs) by more than 20%, reductions will take place over at least 2 years with a single year drop maximum of 19%.¹ Unfortunately, such limits do not apply to revised codes, which can take as big a hit as the CMS cares to make.

Changes to Global Periods

In 2015, we learned that 10- and 90-day global periods would be eliminated in 2017 and 2018, respectively, with great concern on the part of the government about the number and level of evaluation and management services embedded in these codes. The implementation of global policy elimination was prohibited by MACRA and the CMS was required to develop and implement a process to gather data on services furnished in the global period from a representative sample of physicians, which they will use to value surgical services beginningin 2019.¹ The CMS decided to capture this data with a new set of time-based G codes (which would be onerous for all practicing physicians), not just the unlucky folks who were to be the sample mandated under MACRA.² During the comment period, it became obvious to the CMS that this concept was flawed for many reasons and it decided to hold a town hall meeting at the CMS headquarters on August 25, 2016, on data collection on resources used in furnishing global services in which 90 minutes of live testimony in the morning was followed by another 90 minutes by telephone in the afternoon.³ This meeting, which I attended, resulted in the CMS changing the all-practitioner reporting program to a specified sample with others allowed to opt in. Practitioners in groups of less than 10 are exempt, and only physicians in Florida, Kentucky, Louisiana, Nevada, New Jersey, North Dakota, Ohio, Oregon, and Rhode Island must capture data beginning in July 2017.¹ These data only have to be captured on codes that are used by more than 100 practitioners and are furnished at least 10,000 times or have allowed charges of greater than $10,000,000 annually. If you are lucky enough to live in one of the testing states, you must start on July 1 but can start before July 1 if you wish. Practitioners in smaller practices or in other geographic areas are encouraged to report data if feasible but are not required to do so. Current Procedural Terminology (CPT) code 99024 will be used for reporting postoperative services rather than the proposed onerous set of G codes, and reporting will not be required for preoperative visits included in the global package or for services not related to the patient’s visit.

Changes to Chronic Care Management

There are new and modified chronic care management codes that are not of use to you unless you are the primary provider for the patient and you and the patient meet multiple stringent requirements.⁴ The patient must have multiple illnesses, use multiple medications, be unable to perform activities of daily living, require a caregiver, and/or have repeat admissions or emergency department visits. Typical adult patients who receive complex chronic care management services are treated with 3 or more prescription medications and may be receiving other types of therapeutic interventions (eg, physical therapy, occupational therapy). Typical pediatric patients receive 3 or more therapeutic interventions (eg, medications, nutritional support, respiratory therapy). All patients have 2 or more chronic continuous or episodic health conditions that are expected to last at least 12 months or until the death of the patient and place the patient at serious risk for death, acute exacerbation/decompensation, or functional decline.⁴

Changes to Moderate Sedation Codes

The economic value of providing moderate sedation (eg, drug-induced depression of consciousness during which patients respond purposefully to verbal commands, either alone or accompanied by light tactile stimulation) used to be embedded in a variety of CPT codes, which is no longer the case in 2017. Diazepam or similar drugs swallowed or dissolved under the tongue are not included. The new CPT codes 99151, 99152, 99153, 99155, 99156, and 99157 are not to be used to report administration of medications for pain control or minimal sedation (anxiolysis). An independent trained observer, an individual who is qualified to monitor the patient during the procedure and who has no other duties (eg, assisting at surgery) during the procedure, must be present. If you are thinking of using these codes, read the entire section in the CPT manual,⁴ check your state laws, and consult your malpractice carrier and perhaps even your health care attorney.

Changes to Nail Procedure Codes

Current Procedural Terminology code 11752 (excision of nail and nail matrix, partial or complete [eg, ingrown or deformed nail], for permanent removal; with amputation of tuft of distal phalanx) is now gone, while base code 11750 remains. If you are doing nail surgery and removing underlying bone, instead use code 26236 (partial excision [craterization, saucerization, or diaphysectomy] bone [eg, osteomyelitis]; distal phalanx of finger), 28124 (partial excision [craterization, saucerization, sequestrectomy, or diaphysectomy] bone [eg, osteomyelitis or bossing]; phalanx of toe), or other codes in the same section of the CPT manual if they more precisely describe the procedure performed.

Changes to Slide Consultation Codes

The slide consultation codes 88321 (consultation and report on referred slides prepared elsewhere), 88323 (consultation and report on referred material requiring preparation of slides), and 88325 (consultation, comprehensive, with review of records and specimens, with report on referred material) were revalued this year, with the first 2 showing no change but the latter showing an increase in value from 2.50 to 2.85 RVUs.¹ None are meant to be routine. If you have every slide looked at by someone else for “quality assurance reasons,” the consultation is not reportable. If you use these consultation codes too often, the CMS might have concerns about fraud and abuse. Visit http://data.cms.gov to see how you compare to your peers.

Changes to Reflectance Confocal Microscopy Codes

Reflectance confocal microscopy had new codes for 2016, which were carrier priced, and in 2017 they have real RVUs per the CMS. The payments for these codes have a national average reimbursement of $161.85 for 96931 (reflectance confocal microscopy for cellular and subcellular imaging of skin; image acquisition and interpretation and report, first lesion), $104.80 for 96932 (image acquisition only, first lesion), and $45.94 for 96933 (interpretation and report only, first lesion).⁵ The respective add-on codes have values of $83.26 for 96934 (image acquisition and interpretation and report, each additional lesion [list separately in addition to code for primary procedure]), $35.17 for 96935 (image acquisition only, each additional lesion [list separately in addition to code for primary procedure]), and $43.78 for 96936 (interpretation and report only, each additional lesion [list separately in addition to code for primary procedure]).

Other Coding Changes

There are a whole bunch of new codes in the “Genomic Sequencing Procedures and Other Molecular Multianalyte Assays” (MMAAs) section of CPT. The important thing for you to remember is these codes are for the laboratory performing the assay to report, not the physician ordering it. There is a new Appendix O for proprietary laboratory analysis MMAAs, including those that do not have a Category I code. These MMAAs are identified in Appendix O by a 4-digit number followed by the letter M.⁴

There are some revisions to psychotherapy codes 90832 to 90847. These codes are outside our scope of practice and should only be used by psychiatrists, social workers, psychologists, or other appropriate mental health workers.

Final Thoughts

It has not been a breakout year for telehealth and we still do not have payment for store-and-forward teledermatology, except in a few designated rural areas. With the advent of the rhetoric we have heard after the presidential election, any speculation on what will happen to the brave new world of the merit-based incentive payment system, alternative payment models, and other regulations are anyone’s guess.

All physicians will see changes in reimbursement in 2017. A new president with a new agenda makes for an interesting time ahead for health care in the United States. However, in this time of flux, there is one constant: the Final Rule, an informal term for the annual update on how the Medicare system will function and how much you will get paid for what you do.¹ The document is 393 pages and outlines what is new in the Medicare system, with lots of supplements giving granular details about physician work, overhead, and supply and labor costs. In this column, I have taken the liberty of dissecting the Final Rule for you and to bring attention to its high and low points for dermatologists.

Changes in Relative Value Units

The conversion factor has gone up, meaning you will be paid a bit more this year for what you do; it is not enough to account for inflation or the increasing cost of unfunded mandates, but it is better than nothing. Although the conversion factor was $35.8043 in 2016, it increased by more than 0.2% on January 1, 2017, to $35.8887.¹ How is this conversion factor calculated? We go up 0.5% due to MACRA (Medicare Access and CHIP Reauthorization Act), down 0.013% due to budget neutrality, down 0.07% due to multiple procedure payment reduction changes, and down another 0.18% due to the misvalued code target.¹ The misvalued code target is related to targets established by statute for 2016 to 2018 and payment rates are reduced across the board if they are not met.

If payments suffer from reductions in work value, they may not happen all at once. If the Centers for Medicare & Medicaid Services (CMS) reduce total relative value units (RVUs) by more than 20%, reductions will take place over at least 2 years with a single year drop maximum of 19%.¹ Unfortunately, such limits do not apply to revised codes, which can take as big a hit as the CMS cares to make.

Changes to Global Periods

In 2015, we learned that 10- and 90-day global periods would be eliminated in 2017 and 2018, respectively, with great concern on the part of the government about the number and level of evaluation and management services embedded in these codes. The implementation of global policy elimination was prohibited by MACRA and the CMS was required to develop and implement a process to gather data on services furnished in the global period from a representative sample of physicians, which they will use to value surgical services beginningin 2019.¹ The CMS decided to capture this data with a new set of time-based G codes (which would be onerous for all practicing physicians), not just the unlucky folks who were to be the sample mandated under MACRA.² During the comment period, it became obvious to the CMS that this concept was flawed for many reasons and it decided to hold a town hall meeting at the CMS headquarters on August 25, 2016, on data collection on resources used in furnishing global services in which 90 minutes of live testimony in the morning was followed by another 90 minutes by telephone in the afternoon.³ This meeting, which I attended, resulted in the CMS changing the all-practitioner reporting program to a specified sample with others allowed to opt in. Practitioners in groups of less than 10 are exempt, and only physicians in Florida, Kentucky, Louisiana, Nevada, New Jersey, North Dakota, Ohio, Oregon, and Rhode Island must capture data beginning in July 2017.¹ These data only have to be captured on codes that are used by more than 100 practitioners and are furnished at least 10,000 times or have allowed charges of greater than $10,000,000 annually. If you are lucky enough to live in one of the testing states, you must start on July 1 but can start before July 1 if you wish. Practitioners in smaller practices or in other geographic areas are encouraged to report data if feasible but are not required to do so. Current Procedural Terminology (CPT) code 99024 will be used for reporting postoperative services rather than the proposed onerous set of G codes, and reporting will not be required for preoperative visits included in the global package or for services not related to the patient’s visit.

Changes to Chronic Care Management

There are new and modified chronic care management codes that are not of use to you unless you are the primary provider for the patient and you and the patient meet multiple stringent requirements.⁴ The patient must have multiple illnesses, use multiple medications, be unable to perform activities of daily living, require a caregiver, and/or have repeat admissions or emergency department visits. Typical adult patients who receive complex chronic care management services are treated with 3 or more prescription medications and may be receiving other types of therapeutic interventions (eg, physical therapy, occupational therapy). Typical pediatric patients receive 3 or more therapeutic interventions (eg, medications, nutritional support, respiratory therapy). All patients have 2 or more chronic continuous or episodic health conditions that are expected to last at least 12 months or until the death of the patient and place the patient at serious risk for death, acute exacerbation/decompensation, or functional decline.⁴

Changes to Moderate Sedation Codes

The economic value of providing moderate sedation (eg, drug-induced depression of consciousness during which patients respond purposefully to verbal commands, either alone or accompanied by light tactile stimulation) used to be embedded in a variety of CPT codes, which is no longer the case in 2017. Diazepam or similar drugs swallowed or dissolved under the tongue are not included. The new CPT codes 99151, 99152, 99153, 99155, 99156, and 99157 are not to be used to report administration of medications for pain control or minimal sedation (anxiolysis). An independent trained observer, an individual who is qualified to monitor the patient during the procedure and who has no other duties (eg, assisting at surgery) during the procedure, must be present. If you are thinking of using these codes, read the entire section in the CPT manual,⁴ check your state laws, and consult your malpractice carrier and perhaps even your health care attorney.

Changes to Nail Procedure Codes

Current Procedural Terminology code 11752 (excision of nail and nail matrix, partial or complete [eg, ingrown or deformed nail], for permanent removal; with amputation of tuft of distal phalanx) is now gone, while base code 11750 remains. If you are doing nail surgery and removing underlying bone, instead use code 26236 (partial excision [craterization, saucerization, or diaphysectomy] bone [eg, osteomyelitis]; distal phalanx of finger), 28124 (partial excision [craterization, saucerization, sequestrectomy, or diaphysectomy] bone [eg, osteomyelitis or bossing]; phalanx of toe), or other codes in the same section of the CPT manual if they more precisely describe the procedure performed.

Changes to Slide Consultation Codes

The slide consultation codes 88321 (consultation and report on referred slides prepared elsewhere), 88323 (consultation and report on referred material requiring preparation of slides), and 88325 (consultation, comprehensive, with review of records and specimens, with report on referred material) were revalued this year, with the first 2 showing no change but the latter showing an increase in value from 2.50 to 2.85 RVUs.¹ None are meant to be routine. If you have every slide looked at by someone else for “quality assurance reasons,” the consultation is not reportable. If you use these consultation codes too often, the CMS might have concerns about fraud and abuse. Visit http://data.cms.gov to see how you compare to your peers.

Changes to Reflectance Confocal Microscopy Codes

Reflectance confocal microscopy had new codes for 2016, which were carrier priced, and in 2017 they have real RVUs per the CMS. The payments for these codes have a national average reimbursement of $161.85 for 96931 (reflectance confocal microscopy for cellular and subcellular imaging of skin; image acquisition and interpretation and report, first lesion), $104.80 for 96932 (image acquisition only, first lesion), and $45.94 for 96933 (interpretation and report only, first lesion).⁵ The respective add-on codes have values of $83.26 for 96934 (image acquisition and interpretation and report, each additional lesion [list separately in addition to code for primary procedure]), $35.17 for 96935 (image acquisition only, each additional lesion [list separately in addition to code for primary procedure]), and $43.78 for 96936 (interpretation and report only, each additional lesion [list separately in addition to code for primary procedure]).

Other Coding Changes

There are a whole bunch of new codes in the “Genomic Sequencing Procedures and Other Molecular Multianalyte Assays” (MMAAs) section of CPT. The important thing for you to remember is these codes are for the laboratory performing the assay to report, not the physician ordering it. There is a new Appendix O for proprietary laboratory analysis MMAAs, including those that do not have a Category I code. These MMAAs are identified in Appendix O by a 4-digit number followed by the letter M.⁴

There are some revisions to psychotherapy codes 90832 to 90847. These codes are outside our scope of practice and should only be used by psychiatrists, social workers, psychologists, or other appropriate mental health workers.

Final Thoughts

It has not been a breakout year for telehealth and we still do not have payment for store-and-forward teledermatology, except in a few designated rural areas. With the advent of the rhetoric we have heard after the presidential election, any speculation on what will happen to the brave new world of the merit-based incentive payment system, alternative payment models, and other regulations are anyone’s guess.