2013 payment policy and coding changes affecting surgical practice

Several changes to payment policy and coding and reimbursement are set to take effect in 2013. One catalyst for these changes is the calendar year (CY) 2013 Medicare physician fee schedule (MPFS) final rule, which the Centers for Medicare & Medicaid Services (CMS) released in November 2012. The fee schedule lists payment rates for Medicare Part B services and is updated annually. The American College of Surgeons (ACS) submitted comments related to the MPFS proposed rule on August 31, 2012, which indicated how policy changes could either positively or adversely affect physician payment rates.

Concurrently, the American Medical Association (AMA) released Current Procedural Terminology (CPT*) code changes and revisions for 2013 that will be used by physicians and other qualified health care professionals as a guide to appropriately code for services rendered to patients.

Although the MPFS and coding changes introduce several important payment and coding policies that will affect all physicians, this article focuses on updates particularly relevant to surgery and other related specialties starting in 2013, beginning with highlights from the MPFS.

CY 2013 conversion factor

Under the final MPFS for CY 2013, payments to physicians will be reduced by 27 percent for services rendered in CY 2013, unless Congress takes action on the controversial sustainable growth rate (SGR) formula; as of press time, Congress had not yet intervened.

The CY 2012 conversion factor, which was effective through December 31, 2012, was $34.0376. Application of the SGR and the resultant 27 percent cut will yield a CY 2013 conversion factor of $25.0008. Even if Congress does intervene before the rule takes effect January 1, other updates in the final MPFS rule will result in a CY 2013 conversion factor that differs from the CY 2012 conversion factor, although the CY 2013 conversion factor will be more comparable to the CY 2012 conversion factor.

Although not addressed in the MPFS, provisions in the Budget Control Act of 2011 (BCA), Public Law 112-25, also will affect physician payments under Medicare starting in 2013. The BCA was designed to raise the debt ceiling and reduce the deficit, but also resulted in an additional 2 percent cut to the Medicare program through a process called sequestration. This process was designed to prod the congressional “super committee” to adopt deficit reduction measures by November 2011. Because Congress and the White House failed to agree on alternative spending reductions that met the parameters of the legislation, BCA-related cuts will begin on January 2, 2013, and extend through the next eight years. At press time, Congress had not determined whether to leave the BCA-related cuts in place, replace some or all of them, postpone them, or cancel them entirely.

Global surgical package and transitional care

Many changes in the MPFS are based on the work of the AMA/Specialty Society Relative Value Scale Update Committee (RUC). In the proposed MPFS rule, CMS sought comments on methods for obtaining accurate and current data on evaluation and management (E/M) services and whether these services are provided as part of the global surgical package. The ACS expressed support for the AMA RUC’s deliberative process for evaluating the values of global surgical payments, including E/M services provided. The final MPFS rule does not make any changes to the methods for evaluating E/M services provided as part of the global surgical package, but CMS has indicated that it will continue to consider how to best measure the number and level of visits that occur within the global period.

The MPFS also addresses the significant work involved in coordinating services for a patient after discharge by creating a new code to describe a patient’s transition from care furnished by a physician during a hospital, skilled nursing facility, or community mental health center stay to outpatient care furnished by the patient’s primary physician. However, the MPFS final rule finalizes CMS’ policy that physicians who report a global procedure may not report the new transition care management code. CMS maintains that surgeons typically would not be in a position to coordinate all aspects of a patient’s care transition because surgeons’ relationships with patients frequently end with the completion of the global period unless additional surgery is required.

In addition to other comments on this issue, the ACS stressed that surgeons reporting a 10- or 90-day global code should be allowed to report the new transitional care management code if all required work is performed and documented. The College explained that the transitional care management services covered under this new code are distinct from discharge-day management work included in the 10- or 90-day global periods.

Also related to transitional care management, CMS responded to comments from the ACS and other stakeholders by allowing physicians to report both a discharge management code and the new transitional care management code. This change aligns Medicare rules with CPT rules on this transitional care management code policy, as discussed later in this article.

Electronic Prescribing Incentive Program

The Medicare Electronic Prescribing (eRx) Incentive Program provides payment incentives and payment adjustments to physicians and certain nonphysician practitioners (NPPs) who meet specified criteria for the use of qualified e-prescribing systems. Among other updates in the final rule, CMS finalized both of the proposed new significant hardship exemptions as a way for physicians to avoid the 2013 and 2014 eRx penalties. Under the rule, individuals who may now claim the hardship exemptions include:

1. Eligible professionals (EPs) or group practices that achieve meaningful use during certain 2013 and 2014 eRx payment adjustment reporting periods
2. EPs or group practices that demonstrate intent to participate in the Electronic Health Records (EHR) Incentive Program and adopt certified EHR technology

CMS also stated that the agency will use the information collected in the EHR Incentive Program to determine which physicians qualify for these two exemptions so physicians will not have to proactively apply for them. The ACS was very supportive of the addition of these two new significant hardship exceptions to the eRx program.

Physician Quality Reporting System

The Physician Quality Reporting System (PQRS) is a Medicare quality reporting program that provides payment incentives and payment adjustments to physicians and certain NPPs who satisfactorily report data on quality measures for covered services provided during a specified reporting period. The rule finalizes CMS’ proposal to reduce the number of EPs comprising a PQRS group practice from 25 or more to two or more.

Additionally, CMS finalized a proposal to lower the threshold for reporting measures groups via a registry from 30 to 20 patients for both the 12-month and six-month reporting options. Of these 20 patients, at least 11 must be Medicare patients. CMS also lowered the threshold from 30 to 20 patients for reporting measure groups via claims for the 12-month reporting option. The ACS was generally supportive of these changes.

Previously, the three PQRS reporting options available to EPs were via registries, claims, or EHRs. In the final rule, CMS finalizes two additional reporting options. First is the administrative claims option, which would be a way for EPs to avoid the 2015 PQRS penalty. CMS indicated that the agency might, in the future, consider finalizing this reporting option as a way to avoid the 2016 PQRS penalty as well. CMS also finalized an alternative reporting option in which EPs and group practices would only have to report one measure or measures group using the claims, registry, or EHR-based reporting mechanisms. This provision offers another way for EPs and group practices to avoid the 2015 PQRS penalties, with the exception that group practices will not be able to report using the claims-based or EHR-based reporting mechanisms. The ACS was largely supportive of CMS’ flexibility in adding these additional reporting options while additional improvements are made to the program that will allow for more meaningful participation in PQRS.

Physician Compare website

The Physician Compare website is designed to help patients locate and obtain information on Medicare-participating physicians in their communities. In addition to other revisions to the Physician Compare website, the MPFS rule finalizes a proposal to publicly report patient experience of care data on Physician Compare. The data to be reported would be collected no earlier than 2013 and reported no earlier than 2014. This patient experience of care data will be limited to data reported via the PQRS group practice reporting option (GPRO) Web interface by groups of 100 or more EPs and by accountable care organizations. The ACS comment letter expressed concern that CMS will be unable to accurately collect data on patient experience of care and that some group practices will be unable to administer patient experience of care surveys in a reliable way. However, the final rule emphasizes that CMS will only post statistically valid, reliable, and applicable data.

In the MPFS final rule, CMS continues to consider allowing reporting on Physician Compare of measures that have been developed and the related data collected by approved specialty societies. The ACS comment letter requested clarification and additional details from CMS on the implementation of this concept. The final rule indicates that CMS will work with specialty societies to identify appropriate quality measure data that are already collected and available. CMS emphasized that any specialty society measures under consideration will be subject to the Measures Application Partnership pre-rulemaking process before they are considered for the Physician Compare website.

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 applied 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.

The value-based payment modifier will initially apply to groups of physicians, which CMS plans to separate 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. 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. Those physicians attempting to earn a higher value-based payment modifier amount would also be at risk, based on their quality and cost scores, for a payment decrease of up to 1.0 percent. Physician groups that do not meet the PQRS group reporting requirements would have a modifier amount of –1.0 percent applied to their claims submitted under the MPFS. CMS outlines the details of this policy in the final MPFS rule; however, some of the changes in the final rule make the policy more flexible and less burdensome to physicians.

The first change in the final MPFS rule that allows more flexibility for physicians is related to the size of physician groups that would be subject to the value-based payment modifier starting in 2015 from groups of 25 or more EPs, which could include physicians and other specified NPPs, to groups of 100 or more EPs. The ACS comment letter urged CMS to increase the group size for the initial application of the value-based payment modifier, given that the limited scope of the quality and cost measures currently included in the value-based payment modifier present significant challenges for single-specialty groups and larger groups are more likely to include multiple specialties.

In the final MPFS rule, CMS relaxes the requirements by allowing groups of 100 or more EPs to avoid the –1.0 percent downward value-based payment modifier adjustment if they self-nominate for either the PQRS GPRO Web-interface or registry-based reporting options and report at least one of these measures. This change rewards physician groups for attempting to report PQRS measures, even if they are unsuccessful at reporting all the measures required by the chosen reporting option, which was a requirement in the proposed rule.

Another improvement is that groups of 100 or more EPs may also avoid the –1.0 percent downward value-based payment modifier adjustment by, as a group, electing the PQRS administrative claims group reporting option. The physicians in the group then have the option of reporting PQRS measures as individuals, instead of as a group. This way, the physicians can avoid the value-based payment modifier penalty but still participate individually in PQRS. This added flexibility in the final rule addresses the ACS’ concerns that it would be inequitable to apply the –1.0 downward adjustment to physicians who are successful PQRS reporters but are not reporting using GPRO as the proposed rule required.

Read more about these and other changes in final MPFS rule.

Read the ACS comment letter.

CPT coding changes

In addition to the changes stemming from the fee schedule, surgeons should also be aware of how changes to the 2013 CPT code set will affect them and their practices. The remainder of this article summarizes these modifications and their potential effects, beginning with the definition of a “qualified healthcare provider.”

Qualified health care provider

CPT does not specify who is or is not qualified to perform a service or procedure, other than to state that the practitioner must be “qualified.” In 2013, terminology has been revised throughout the 2013 codebook, CPT 2013 Professional Edition, to indicate “physicians or other qualified healthcare professionals” with the intent of provider neutrality. This change is a clarification of the difference between a qualified provider and a clinical staff member who may provide portions of a service under the supervision of a qualified provider but does not individually report a service with a CPT code.

Observation or inpatient hospital care

In 2013, the observation or inpatient hospital care services provided to patients admitted and discharged on the same date of service have been further clarified to include typical time according to actual practice patterns. The following codes are used by physicians or other qualified health care providers to report observation or inpatient hospital care services: CPT code 99234, Observation or inpatient hospital care; typically 40 minutes is spent at the bedside and on the patient’s hospital floor or unit; 99235, Observation or inpatient hospital care; typically 50 minutes is spent at the bedside and on the patient’s hospital floor or unit; and 99236, Observation or inpatient hospital care; typically 55 minutes is spent at the bedside and on the patient’s hospital floor or unit.

Chronic care and transitional care management

New CPT codes for chronic care management, specifically complex chronic care management of multiple diseases, and post-discharge transitional care management have been added in 2013 (see table for their  full descriptors).

General surgery CPT 2013 changes
CPT code	Descriptor
» 15740	Flap; island pedicle requiring identification and dissection of an anatomically named axial vessel.
32420	Code deleted. Pneumocentesis, puncture of lung for aspiration. (To report, use 32405.)
32421	Code deleted. Thoracentesis, puncture of pleural cavity for aspiration, initial or subsequent. (To report, see 32554.)
32422	Code deleted. Thoracentesis with insertion of tube, includes water seal (eg, for pneumothorax), when performed (separate procedure). (To report, see 32555.)
• 32554	Thoracentesis, needle or catheter, aspiration of the pleural space; without imaging guidance.
• 32555	Thoracentesis, needle or catheter, aspiration of the pleural space; with imaging guidance.
• 32556	Pleural drainage, percutaneous, with insertion of indwelling catheter; without imaging guidance.
• 32557	Pleural drainage, percutaneous, with insertion of indwelling catheter; with imaging guidance.
» 32551	Tube thoracostomy, includes connection to drainage system (eg, water seal), when performed, open (separate procedure).
43234	Code deleted. Upper gastrointestinal endoscopy, simple primary examination (eg, with small diameter flexible endoscope) (separate procedure). (To report, use 43235.)
• 0312T	Vagus nerve blocking therapy (morbid obesity); laparoscopic implantation of neurostimulator electrode array, anterior and posterior vagal trunks adjacent to esophagogastric junction (EGJ), with implantation of pulse generator, includes programming.
• 0313T	Vagus nerve blocking therapy (morbid obesity);  laparoscopic revision or replacement of vagal trunk neurostimulator electrode array, including connection to existing pulse generator.
• 0314T	Vagus nerve blocking therapy (morbid obesity);  laparoscopic removal of vagal trunk neurostimulator electrode array and pulse generator.
• 0315T	Vagus nerve blocking therapy (morbid obesity); removal of pulse generator.
• 0316T	Vagus nerve blocking therapy (morbid obesity); replacement of pulse generator.
• 0317T	Vagus nerve blocking therapy (morbid obesity); neurostimulator pulse generator electronic analysis, includes reprogramming when performed.
» 99234	Observation or inpatient hospital care, for the evaluation and management of a patient including admission and discharge on the same date, which requires these 3 key components: a detailed or comprehensive history; a detailed or comprehensive examination; and medical decision making that is straightforward or of low complexity. Counseling and/or coordination of care with other providers or agencies are provided consistent with the nature of the problem(s) and the patient’s and/or family’s needs. Usually the presenting problems requiring admission are of low severity. Typically 40 minutes is spent at the bedside and on the patient’s hospital floor or unit.
» 99235	Observation or inpatient hospital care, for the evaluation and management of a patient including admission and discharge on the same date, which requires these 3 key components: a comprehensive history; a comprehensive examination; and medical decision making of moderate complexity. Counseling and/or coordination of care with other providers or agencies are provided consistent with the nature of the problem(s) and the patient’s and/or family’s needs. Usually the presenting problem(s) requiring admission are of moderate severity. Typically 50 minutes is spent at the bedside and on the patient’s hospital floor or unit.
» 99236	Observation or inpatient hospital care, for the evaluation and management of a patient including admission and discharge on the same date, which requires these 3 key components: a comprehensive history; a comprehensive examination; and medical decision making of moderate complexity. Counseling and/or coordination of care with other providers or agencies are provided consistent with the nature of the problem(s) and the patient’s and/or family’s needs. Usually the presenting problem(s) requiring admission are of high severity. Typically 55 minutes is spent at the bedside and on the patient’s hospital floor or unit.
• 99487	Complex chronic care coordination services; first hour of clinical staff time directed by a physician or other qualified health care professional with no face-to-face visit, per calendar month.
• 99488	Complex chronic care coordination services; first hour of clinical staff time directed by a physician or other qualified health care professional with one face-to-face visit, per calendar month.
• 99489	Complex chronic care coordination services; each additional 30 minutes of clinical staff time directed by a physician or other qualified health care professional, per calendar month (List separately in addition to code for primary procedure).
• 99495	Transitional care management services with the following required elements: Communication (direct contact, telephone, electronic) with the patient and/or caregiver within 2 business days of discharge, medical decision making of at least moderate complexity during the service period, and face-to-face visit within 14 calendar days of discharge.
• 99496	Transitional care management services with the following required elements: Communication (direct contact, telephone, electronic) with the patient and/or caregiver within 2 business days of discharge, medical decision making of high complexity during the service period, and face-to-face visit, within 7 calendar days of discharge.
» = new code, • = revised code

Complex chronic care management CPT codes 99487, Complex chronic care coordination services; first hour of clinical staff time directed by a physician or other qualified health care professional with no face-to-face visit, per calendar month; 99488, Complex chronic care coordination services; first hour of clinical staff time directed by a physician or other qualified health care professional with one face-to-face visit, per calendar month; and 99489, Complex chronic care coordination services; each additional 30 minutes of clinical staff time directed by a physician or other qualified health care professional, per calendar month (List separately in addition to code for primary procedure), are defined as patient-centered management and support services provided by physicians, other qualified health care professionals and clinical staff, as needed, for all medical conditions, psychosocial needs, and activities of daily living.

CPT codes 99487–99489 are reported once per calendar month and may only be reported by the single physician or other qualified health care professional who assumes the care coordination role with a particular patient for the calendar month.

CPT codes 99495, Transitional care management services with the following required elements: Communication (direct contact, telephone, electronic) with the patient and/or caregiver within 2 business days of discharge, medical decision making of at least moderate complexity during the service period, and face-to-face visit, within 14 calendar days of discharge, and 99496, Transitional care management services with the following required elements: Communication (direct contact, telephone, electronic) with the patient and/or caregiver within 2 business days of discharge, medical decision making of high complexity during the service period, and face-to-face visit, within 7 calendar days of discharge, are used to report transitional care management services (TCM). These services are for an established patient whose medical and/or psychosocial problems require moderate- or high-complexity medical decision making during transition from a hospital setting (including hospital inpatient status, rehabilitation hospital, long-term acute care hospital, observation status in a hospital, or skilled nursing facility/nursing facility) to the patient’s community setting (home, domiciliary, rest home, or assisted living).

As stated above, the final MPFS and CPT clearly state that only one physician may report these services within 30 days of discharge. In addition, a physician in a global period (10 or 90 days) may not bill TCM, thereby making these codes unusable for most postoperative surgical patient discharges. However, TCM may be reported by the same physician who provides only hospital or observation discharge management.

Island pedicle flap

The 2013 revised guidelines and descriptor for code 15740 now include the requirement of an anatomically named axial vessel: 15740, Flap; island pedicle requiring identification and dissection of an anatomically-named axial vessel.

To appropriately code for the services provided for random island flaps, V-Y subcutaneous flaps, advancement flaps, and other flaps from adjacent areas without clearly defined anatomically named axial vessels, use codes 14000–14302.

Thoracentesis, percutaneous pleural drainage, and open tube thoracostomy

Four new codes (32554–32557) have been created to describe needle thoracentesis and percutaneous pleural drainage with or without imaging. In addition, code 32551 for tube thoracostomy has been revised to indicate an open approach. With these coding changes, it will be important to focus on the procedural technique documented by the provider rather than the size of the drain placed.

The family of codes previously used to report thoracentesis have been deleted (32420–32422) and replaced with the following codes:

• 32554, Thoracentesis, needle or catheter, aspiration of the pleural space; without imaging guidance
• 32555, Thoracentesis, needle or catheter, aspiration of the pleural space; with imaging guidance
• 32556, Pleural drainage, percutaneous, with insertion of indwelling catheter; without imaging guidance
• 32557, Pleural drainage, percutaneous, with insertion of indwelling catheter; with imaging guidance

CPT has revised code 32551, Tube thoracostomy, includes connection to drainage system (eg, water seal), when performed, open (separate procedure), to clarify its use as an open surgical procedure. CPT has deleted the parenthetical reference of specific diagnoses that may have created confusion for coders. CPT has also deleted the illustration of “Insertion of Chest Tube” and the exclusionary parenthetical because they did not accurately depict open chest tube placement. (See the coding highlight in the sidebar on this page.)

Codes 32554–32555 should be reported for aspiration procedures intended only for transient needle or catheter insertion. Codes 32554–32557 should be reported for percutaneous catheter placement, sutured in place, and connected to a drainage system for ongoing drainage. Code 32551 should be reported for open chest tube placement, sutured in place, and connected to a drainage system for ongoing drainage.

CPT code 32551 includes an incision over the intended rib interspace, dissection of the subcutaneous tissues and chest wall muscles (including deep intercostal muscles and pleura). A finger is placed through this incision, the pleural cavity palpated, and loculations are broken up. A thoracostomy tube is inserted into the pleural cavity for drainage and to promote lung expansion and accumulated blood or fluid is evacuated. The tube is sutured in place.

Although the exclusionary parenthetical has been deleted, do not report 32551 when it is inherent to a larger procedure, including thoracic, cardiac, and some esophageal procedures where a thoracotomy or thoracoscopic approach is applied, use only the primary procedure code.

Do not report imaging guidance in conjunction with 32551. However, diagnostic ultrasound may be separately reported if a thorough evaluation of organ(s) or anatomic region, image documentation, and final written report are performed.

For bilateral open thoracostomy tube placement, append the modifier 50 to code 32551. Additionally, if more than one open thoracostomy tube is placed on the same side (for example, ipsilateral), on the same day, through a separate incision, it is appropriate to append modifier 59, distinct procedural service.

Endoscopy

Code 43234, previously used to report upper gastrointestinal panendoscopy using a small diameter endoscope, has been deleted as obsolete. To report diagnostic upper gastrointestinal endoscopy, see code 43235, Upper gastrointestinal endoscopy including esophagus, stomach, and either the duodenum and/or jejunum as appropriate; diagnostic, with or without collection of specimen(s) by brushing or washing (separate procedure).

Laparoscopy

Six new Category III codes are available to report laparoscopic implantation, revision, replacement, removal and/or reprogramming for vagus nerve blocking therapy for morbid obesity at the esophagogastric junction:

• 0312T, Vagus nerve blocking therapy (morbid obesity); laparoscopic implantation of neurostimulator electrode array, anterior and posterior vagal trunks adjacent to esophagogastric junction (EGJ), with implantation of pulse generator, includes programming
• 0313T, Vagus nerve blocking therapy (morbid obesity); revision or replacement of vagal trunk neurostimulator electrode array, including connection to existing pulse generator
• 0314T, Vagus nerve blocking therapy (morbid obesity); removal of vagal trunk neurostimulator electrode array and pulse generator
• 0315T, Vagus nerve blocking therapy (morbid obesity); removal of pulse generator:0316T, Vagus nerve blocking therapy (morbid obesity); replacement of pulse generator
• 0317T, Vagus nerve blocking therapy (morbid obesity); neurostimulator pulse generator electronic analysis, includes reprogramming when performed

As stated in the 2013 CPT Changes: An Insider’s View,* for open implantation, revision, or removal of gastric lesser curvature or vagal trunk (EGJ) neurostimulator electrodes, [morbid obesity], use 43999. For implantation, revision, replacement, and/or removal of vagus [cranial] nerve neurostimulator electrode array and/or pulse generator for vagus nerve stimulation performed other than at the EGJ [eg, epilepsy], see 64568–64570.

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Editor’s note
Accurate coding is the responsibility of the provider. This summary is only a resource to assist in the billing process.

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*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.

*American Medical Association. CPT^® Changes 2013: An Insider’s View. Distributed by American Medical Association Press. 2012. Available at: https://catalog.ama-assn.org/Catalog/. Accessed December 11, 2012.