2014 fee schedule and CPT code changes will affect surgical practice

Editor’s note: This article was posted electronically with the January Bulletin so that surgeons would have access to the important information it provides regarding changes in Medicare payment that took effect last month. Due to delays in the release of the final rule on the fee schedule, this information was unavailable when the print version of the January Bulletin went to press, so we are publishing it this month.

New payment policy and coding and reimbursement changes set forth by the calendar year (CY) 2014 Medicare physician fee schedule (MPFS) final rule took effect January 1, 2014. The fee schedule, which the Centers for Medicare & Medicaid Services (CMS) updates annually, lists payment rates for Medicare Part B services. The American College of Surgeons (ACS) submitted comments related to the MPFS proposed rule on September 5, 2013, which provided feedback to CMS on a number of policies that were outlined in the final rule, which was released in November 2013.

Concurrently, the American Medical Association (AMA) released Current Procedural Terminology (CPT*) code changes and revisions for 2014, which physicians and other qualified health care professionals will use as a guide to appropriately code for services rendered to patients.

Although the MPFS and CPT changes introduce important payment and coding policy changes that affect all physicians, this article focuses on updates particularly relevant to surgery and related specialties, beginning with highlights from the MPFS.

CY 2014 conversion factor

Under the final MPFS for CY 2014, payments to physicians would have been reduced by more than 24 percent for services rendered in CY 2014, barring congressional action. Just before adjournment in December 2013, Congress passed a three-month 0.5 percent increase in the Medicare physician payment rate as a bridge to allow for negotiations on a permanent repeal of the sustainable growth rate (SGR) formula, which is the root cause of the payment reductions. The cut is now scheduled for April 1.

Nonetheless, other updates in the final MPFS rule will result in a CY 2014 conversion factor that differs from the CY 2013 conversion factor. These provisions center on potentially misvalued services, the Physician Quality Reporting System (PQRS), the Physician Compare website, and the value-based payment modifier.

Potentially misvalued services

In the MPFS proposed rule, CMS indicated that payment for services provided in the physician office typically should not exceed payment for the same services provided in either the hospital outpatient department (OPD) or in an ambulatory surgical center (ASC). However, CMS identified over 200 services for which payment in the physician office does, in fact, exceed the costs for these services provided in the OPD or ASC, and the agency proposed to limit the payment in the physician office setting to the OPD or ASC rate.

Based on comments from the ACS and other stakeholders, CMS decided not to implement this proposal in the final rule. The ACS comment letter stressed that the methodology used by the AMA/Specialty Society Relative Value Scale Update Committee (RUC) to calculate values under the physician fee schedule is appropriate and that these payment rates should not be based on OPD and ASC payment rates, which are calculated using a different set of factors.

PQRS

The PQRS is a Medicare quality reporting program that provides payment incentives and payment adjustments to eligible professionals (EPs) who satisfactorily report data on quality measures for covered services furnished during a specified reporting period. CMS finalized several key changes for PQRS 2014, including a new reporting option for individual EPs.

QCDR

In addition to the claims-, electronic health records (EHRs) and traditional registry-based reporting options, beginning in 2014, EPs also may report via the new Qualified Clinical Data Registry (QCDR) reporting option. A QCDR is a CMS-approved entity that collects medical and/or clinical data to track patients and diseases for purposes of improving quality of care.

A QCDR differs from a traditional PQRS registry in several ways. Thiis option was created to provide opportunity for EPs to simultaneously use existing high-quality clinical registries for quality improvement and for meeting PQRS reporting requirements. In theory, QCDRs provide more flexibility in participating in PQRS than other PQRS reporting options, allowing EPs to report on a variety of measure types, including those from the Consumer Assessment of Healthcare Providers and Systems Clinician and Group (CG-CAHPS) survey, measures that the National Quality Forum (NQF) has endorsed; current PQRS measures, measures used by medical boards or specialty societies; and measures used in regional quality collaboratives.

In addition, QCDRs must have the capacity to track outcomes and at least one outcome measure, provide timely feedback reports, and risk-adjust when appropriate. All of these capabilities are intended to result in the reporting of measures that are more relevant, clinically appropriate, and actionable for surgeons when compared with the measures currently available as reporting options through PQRS. For the QCDR, individual EPs must report on nine measures selected by the QCDR that cover at least three National Quality Strategy (NQS) domains for 50 percent of applicable patients to which each measure applies.

Traditional PQRS reporting options

Traditional PQRS reporting allows for reporting on individual measures, or alternatively, on measures groups . For individual measure reporting via the claims- and registry-based options, CMS finalized reporting on nine measures covering at least three NQS domains for 50 percent of the applicable Medicare Part B fee-for-service (FFS) patients.

For the measures group reporting option, there were also a few key changes. CMS eliminated the option for EPs to report on measures groups through the claims-based reporting option. Therefore, the only available option to report on measures groups in 2014 will be the registry-based reporting option. In addition, CMS finalized a new PQRS measures group relevant to surgery, the general surgery measures group, which includes measures relevant to procedures such as ventral hernias, appendectomies, and cholecystectomies.

Physician Compare website

The Physician Compare website is designed to help patients locate and obtain information on Medicare-participating physicians. In its response to the MPFS proposed rule, the ACS urged CMS to make additional improvements to the Physician Compare website to ensure that both the search function and underlying demographics of the data on the website are accurate. In the final rule, CMS acknowledged that the agency is reevaluating how information is presented on the website and will continue to seek input from specialty societies. CMS also noted that it will be issuing a report to Congress by January 1, 2015, on the development of the Physician Compare website.

Furthermore, CMS finalized several of its proposals for adding new information via the Physician Compare website, including: performance rates for all quality measures that group practices submit through the Group Practice Reporting Option (GPRO) Web interface in 2014; performance on certain quality measures collected under the 2014 PQRS GPRO through the traditional registry and EHR reporting mechanisms; performance on patient experience measures for group practices of 25 or more professionals who choose to voluntarily report CG CAHPS in 2014; performance on a specific set of 20 measures by individual EPs reporting through an EHR, registry, or claims for PQRS 2014; and performance rates for measures included in the cardiovascular prevention measures group reported by individual EPs for PQRS 2014.

Value-based payment modifier

The Affordable Care Act (ACA) requires that CMS apply a value-based payment modifier to physician payments, starting with some physicians in 2015 and extending to all physicians by 2017. Application of the value-based payment modifier will result in Medicare paying physicians differentially based on the quality of care they provide.

2015 payment adjustment

The value-based payment modifier will initially apply to physicians within groups of 100 or more EPs in 2015 based on their performance in 2013. EPs, which are counted for the calculation of group size, include physicians and certain other nonphysician practitioners. CMS plans to separate these groups of EPs into categories based on whether they successfully participate in one of the PQRS GPROs. The payment modifier for group practices that satisfactorily report the PQRS quality measures associated with the GPRO they select will be set at zero initially, which would prevent the value-based payment modifier from lowering their Medicare rates in 2015. These physicians may either keep the 0 percent update or pursue a higher modifier amount based on their performance with respect to quality and cost measures, an option described as “quality tiering.” Physicians attempting to earn a higher value-based payment modifier amount through quality tiering would also be at risk, based on their quality and cost scores, for a payment decrease of up to 1.0 percent in 2015. Physicians in groups of 100 or more EPs that did not meet the PQRS reporting requirements for 2013 would have a modifier amount of –1.0 percent applied to their claims submitted under the MPFS in 2015.

2016 payment adjustment

The final MPFS comprises several changes to the value-based payment modifier that would apply in 2016, based on performance in 2014. For the 2016 payment adjustment, CMS will apply the value-based payment modifier to groups of 10 or more EPs, down from 100 or more in 2015. The final rule also makes quality tiering mandatory for groups of 10 or more, but only groups of 100 or more will be subject to a downward adjustment. In other words, physicians in groups of 10 to 99 EPs will either receive a 0 percent update or an upward adjustment based on their performance with respect to quality and cost measures, and physicians in groups of 100 or more EPs would receive either an upward, downward, or 0 percent adjustment. CMS also finalized a policy that would apply a modifier amount of -2.0 percent to claims submitted in 2016 by physicians in groups of 10 or more that fail to meet the PQRS reporting requirements for 2014.

An improvement to the value-based payment modifier that would take effect in 2016 is that, in addition to the group reporting options, CMS will allow EPs in groups of 10 or more EPs to report individually on PQRS. Therefore, if at least 50 percent of the EPs in the group avoid the CY 2016 PQRS payment adjustment using any reporting option available under PQRS, the entire group will avoid the 2016 value-based payment modifier adjustment of -2.0 percent.

The ACS comment letter on the proposed rule strongly advocated that CMS include an option to allow individual PQRS reporting, in addition to group PQRS reporting under the GPRO, to count toward avoiding the value-based payment modifier penalties. The ACS comment letter also successfully persuaded CMS to lower the threshold of EPs from 70 percent to 50 percent within a group that is required to meet the individual PQRS reporting criteria.

Another refinement to the value-based payment modifier for 2016 relates to the benchmarks used to compare physician costs. Under the current policy for 2015, a national average will be calculated for each of the cost measures under the value-based payment modifier, and the costs of physicians are compared with this national mean. However, CMS acknowledged that this approach compares all specialties using the same benchmark for each cost measure, despite the fact that some specialties have inherently higher costs than others. Consequently, CMS refined the methodology to create a different cost benchmark for each specialty to only compare physicians’ costs with other physicians within the same specialty.

CPT coding changes

The CPT 2014 manual comprises several new codes and code changes pertaining to general surgery and its closely related specialties. The following is a summary of these modifications.

Interprofessional telephone/Internet consultations

In 2014, four new codes have been established in the evaluation and management (E/M) section of the manual describing interprofessional telephone/internet consultative services: CPT code 99446, Interprofessional telephone/Internet assessment and management service provided by a consultative physician including a verbal and written report to the patient’s treating/requesting physician or other qualified health care professional; 5-10 minutes of medical consultative discussion and review; CPT code 99447, Interprofessional telephone/Internet assessment and management service provided by a consultative physician including a verbal and written report to the patient’s treating/requesting physician or other qualified health care professional;11-20 minutes of medical consultative discussion and review; CPT code 99448, Interprofessional telephone/Internet assessment and management service provided by a consultative physician including a verbal and written report to the patient’s treating/requesting physician or other qualified health care professional; 21-30 minutes of medical consultative discussion and review; and CPT code 99449, Interprofessional telephone/Internet assessment and management service provided by a consultative physician including a verbal and written report to the patient’s treating/requesting physician or other qualified health care professional; 31 minutes or more of medical consultative discussion and review.

CPT codes 99446–99449 are for reporting interprofessional telephone/Internet consultation, defined as an assessment and management service in which a patient’s treating physician or other qualified health care professional requests the opinion and/or treatment advice of a physician with specific specialty expertise (the consultant) to assist in the diagnosis and/or management of the patient’s problem without the need for the patient’s face-to-face contact with the consulting physician. These codes are typically provided in complex and urgent situations where a timely consultation may be infeasible, for example, due to geographic distance. The consultant reports these codes, which are time-based according to the amount of time spent in medical consultative discussion and review.

Skin, subcutaneous, and accessory structures

CPT code 10030, Image-guided fluid collection drainage by catheter (eg, abscess, hematoma, seroma, lymphocele, cyst), soft tissue (eg, extremity, abdominal wall, neck), percutaneous has been established to report the bundled service of image-guided percutaneous fluid collection drainage by catheter (eg, abscess, hematoma, seroma, lymphocele, cyst), for soft tissue (eg, extremity, abdominal wall, neck). Code 10030 should be reported for each collection drained with a separate catheter. Code 10030 is not used to report image-guided fluid collection drainage, (percutaneous or transvaginal/transrectal) of visceral, peritoneal, or retroperitoneal; these services should be reported using codes 49405-49407.

Note that CPT reporting convention requires that any image-guided procedure must include permanent images and a written report describing the imaging findings and intervention.

Complex repair

The code previously used to report complex repair of the eyelids, nose, ears and/or lips measuring 1.0 cm or less (13150) has been deleted. To report this service the anatomically correct and appropriate size simple (12001-12021) or intermediate (12031-12057) repair codes should be reported. In addition, code 13151, Repair, complex, eyelids, nose, ears and/or lips; 1.1 cm to 2.5 cm was revised to be the parent code for this anatomic area.

Other flaps and grafts

In 2014, CPT code 15777, Implantation of biologic implant (eg, acellular dermal matrix) for soft tissue reinforcement (ie, breast, trunk) (List separately in addition to code for primary procedure) has been revised; the “eg” within the parenthetical has been replaced with “ie.” Therefore, code 15777 should only be used to report the implantation of biologic implant in the breast and trunk. The implantation of biologic implants for soft tissue reinforcement in tissues other than breast and trunk should be reported with the unlisted code 17999, Unlisted procedure, skin, mucous membrane, and subcutaneous tissue.

Breast

The codes previously used to report breast biopsies and image guidance (19102, 19103, 19290, 19291, 19295, 77031, 77032) have been deleted and replaced with new bundled breast biopsy codes (19081-19086) and bundled breast localization codes (19281-19288).

Six new codes have been created to describe breast biopsy with imaging guidance, two for each of three imaging modalities:

  • For stereotactic guidance: 19081, Biopsy, breast, with placement of breast localization device(s) (eg, clip, metallic pellet), when performed, and imaging of the biopsy specimen, when performed, percutaneous; first lesion, including stereotactic guidance; 19082, Biopsy, breast, with placement of breast localization device(s) (eg, clip, metallic pellet), when performed, and imaging of the biopsy specimen, when performed, percutaneous; each additional lesion, including stereotactic guidance (List separately in addition to code for primary procedure)
  • For ultrasound guidance: 19083, Biopsy, breast, with placement of breast localization device(s) (eg, clip, metallic pellet), when performed, and imaging of the biopsy specimen, when performed, percutaneous; first lesion, including ultrasound guidance; 19084, Biopsy, breast, with placement of breast localization device(s) (eg, clip, metallic pellet), when performed, and imaging of the biopsy specimen, when performed, percutaneous; each additional lesion, including ultrasound guidance (List separately in addition to code for primary procedure)
  • For MRI guidance: 19085, Biopsy, breast, with placement of breast localization device(s) (eg, clip, metallic pellet), when performed, and imaging of the biopsy specimen, when performed, percutaneous; first lesion, including magnetic resonance guidance; 19086, Biopsy, breast, with placement of breast localization device(s) (eg, clip, metallic pellet), when performed, and imaging of the biopsy specimen, when performed, percutaneous; each additional lesion, including magnetic resonance guidance (List separately in addition to code for primary procedure)

Separate codes for vacuum-assisted biopsy have been deleted—all percutaneous needle biopsy devices are now considered similar for purposes of coding.

Eight new codes have been created in 2014 to describe placement of breast localization device with imaging guidance, two for each of four imaging modalities:

  • For mammogram: 19281, Placement of breast localization device(s) (eg, clip, metallic pellet, wire/needle, radioactive seeds),percutaneous; first lesion, including mammographic guidance; 19282, placement of breast localization device(s) (eg, clip, metallic pellet, wire/needle, radioactive seeds),percutaneous; each additional lesion, including mammographic guidance (List separately in addition to code for primary procedure)
  • For stereotactic: 19283, Placement of breast localization device(s) (eg, clip, metallic pellet, wire/needle, radioactive seeds), percutaneous; first lesion, including stereotactic guidance; 19284, Placement of breast localization device(s) (eg, clip, metallic pellet, wire/needle, radioactive seeds), percutaneous; each additional lesion, including stereotactic guidance (List separately in addition to code for primary procedure)
  • For ultrasound: 19285, Placement of breast localization device(s) (eg, clip, metallic pellet, wire/needle, radioactive seeds), percutaneous; first lesion, including ultrasound guidance; 19286, placement of breast localization device(s) (eg, clip, metallic pellet, wire/needle, radioactive seeds), percutaneous; each additional lesion, including ultrasound guidance (List separately in addition to code for primary procedure)
  • For MRI: 19287, Placement of breast localization device(s) (eg clip, metallic pellet, wire/needle, radioactive seeds), percutaneous; first lesion, including magnetic resonance guidance; 19288, Placement of breast localization device(s) (eg clip, metallic pellet, wire/needle, radioactive seeds), percutaneous; each additional lesion, including magnetic resonance guidance (List separately in addition to code for primary procedure)

When image guidance is used, a report and permanent images must be generated. The second code for each modality is an add-on. When more than one biopsy or localization device placement is performed using the same imaging modality, use the appropriate add-on code to report the service. If additional biopsies are performed using different imaging modalities, report the primary code for each additional modality.

The surgical excision codes have not changed. CPT codes 19100, Biopsy of breast; percutaneous, needle core, not using imaging guidance (separate procedure) and 19101, Biopsy of breast; open, incisional are used to report breast biopsies performed without imaging guidance. Additionally, when an open incisional biopsy is performed after image-guided placement of a localization device, 19125 is reported.

Excision and resection

The 2014 revised guidelines for the excision of subcutaneous soft tissue tumors and radical resection of soft tissue tumors now indicate that codes in these families are used to report the excision or radical resection of connective tissue tumors only. For additional clarity on the use of the radical resection of soft tissue tumors codes, the example within the parenthetical of the code descriptors “malignant neoplasm” has been removed and replaced with “sarcoma.”

For the excision of benign lesions of cutaneous origin, for example, sebaceous cyst, report codes 11400–11446 and for radical resection of tumor(s) of cutaneous origin, for example, melanoma, report codes 11600–11646.

Appendix C

In 2014, Appendix C of the CPT manual contains guideline revisions; users will note that some clinical examples previously provided have been deleted from this appendix. The guidelines now appropriately identify the intended use of the clinical examples; the examples are not intended to replace the use of key components (or time when it becomes the controlling factor for the extent of the visit), descriptors, or guidelines that accompany the codes to determine the level of code to report. However, the clinical examples are intended to be used as educational information to assist in identifying the correct service code.

If you have additional coding questions, contact the ACS Coding Hotline at 800-227-7911 between 7:00 am and 4:00 pm Mountain Time, excluding holidays, or visit the ACS website.


* All specific references to CPT (Current Procedural Terminology) codes and descriptions are © 2012 American Medical Association. All rights reserved. CPT and CodeManager are registered trademarks of the American Medical Association.

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