Speculation exists as to whether these changes were truly budget neutral

Independent study corroborates high error rates for billed consultations. 1 Many billing errors are a function of incomplete documentation relative to the level of E/M service reported. These improper payments persist despite education efforts undertaken by payers and national societies alike to reduce errors. Further, in a number of situations, medically unnecessary consultations continue to be requested.

Effective January 1, 2010, CMS eliminated reimbursement for the outpatient (CPT 99241-99245) and inpatient (CPT 99251-99255) consultation codes, instead mandating use of the new or established patient office visit or initial or subsequent hospital care codes (see “Reporting Outpatient Consultation Services” and “Reporting Inpatient Consultation Services” sections) to report these medically necessary consultative services. CMS implemented this change in a budget-neutral manner with regard to total physician fee schedule expenditures, in accord with their legal mandate, by an approximate 6% increase in physician work relative value units (RVUs) for new and established office visits and an approximate 2% increase in work RVUs for initial hospital and nursing facility visits.

Speculation exists as to whether these changes were truly budget neutral. The new, increased RVUs for each office or initial hospital-mapped CPT code were based on CMS’s code use projections. However, these projections systematically underestimated two factors. First, the E/M code documentation guidelines decrease the level of reportable initial hospital services. For example, an appropriately documented moderate-complexity consultation (CPT 99254) would be appropriately reported by providers as a moderate-complexity initial hospital visit (CPT 99222), not the high-complexity CPT 99223 as CMS presumed in their economic modeling. Second, for outpatient services, the proportion of medically necessary, appropriate consultations performed on patients known to the practice may have been underestimated in general.

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