The 2018 Medicare physician fee schedule was released on Nov. 2, 2017, with generally good news for emergency medicine. As anticipated, there were minimal changes to the ED evaluation and management (E/M) codes, critical care, and observation service values for 2018. Table 50 of the final rule lists the estimated impact by specialty based on changes to the work, practice expense, and professional liability insurance relative value units (RVUs) for 2018. Most of the specialties listed, including emergency medicine, had an estimated impact of 0 percent of overall revenue being changed. There were a few winners, such as clinical social work (3 percent), podiatry (1 percent), and rheumatology (1 percent). The losers in 2018 were allergy/immunology (-3 percent), diagnostic testing facilities (-4 percent), and urology and vascular surgery (-1 percent). Keep in mind that rounding can play a big role in whether you are plus or minus 1 percent or end up with an estimated zero change.

Conversion Factor Increases

Physicians will see a small $0.11 increase to the Medicare payment per RVU in 2018. The Medicare Access and CHIP Reauthorization Act (MACRA) mandated a 0.5 percent increase to the conversion factor (the amount Medicare pays per RVU) for 2018. At the conclusion of 2017, the Medicare conversion factor was set at $35.8887. MACRA provides for annual conversion factor payment increases of 0.5 percent through 2019. With the application of the RVU budget neutrality adjustment and the target recapture amount related to misvalued procedures, the 0.5 percent update was decreased. As a result, the 2018 final rule published a conversion factor of $35.9996, representing a roughly $0.11 increase.

We received information suggesting that the work RVUs for emergency department visits did not appropriately reflect the full resources involved in furnishing these services. … We agree with the majority of commenters that these services may be potentially misvalued given the increased acuity of the patient population and the heterogeneity of the sites where emergency department visits are furnished. As a result, we look forward to reviewing the RUC’s recommendations regarding the appropriate valuation of these services” —2018 Medicare Physician Fee Schedule Final Rule

2018 RVUs for ED E/M Services Remain Stable

Work RVUs represent the most critical component of emergency providers’ reimbursement. For 2018, the work RVUs for emergency medicine services remain unchanged. For ED E/M services 99281–99285, the total RVUs are impacted slightly based on practice expense and professional liability insurance components and are essentially unchanged for 2018 as well (see Table 1). Importantly, the Centers for Medicare an Medicaid Services (CMS) has recommended that the Relative Value Scale Update Committee (RUC) survey and potentially revalue the work RVUs associated with the 99281–99285 codes, citing that they are potentially misvalued. This survey could take place in 2018, and updated work RVUs, if any, would likely be in effect in 2019.

(click for larger image) Table 1. 2018 Emergency Department E/M RVUs 99281–99285, 99291
RVU= relative value units; PE=practice expense; PLI=professional liability insurance

2018 CPT Changes for Emergency Medicine

There are two changes to the 2018 CPT book that are relevant to emergency medicine.

The first is subtle, with the two words “outpatient hospital” having been inserted into the preamble for the observation codes. The opening sentence now reads, “The following codes are used to report encounter(s) by the supervising physician or other qualified health care professional with the patient when designated as outpatient hospital ‘observation status’ [emphases added].” Similar language has also been inserted into the code descriptors.

Depending on the context, this leaves open to interpretation whether a hospital-based location is required for reporting observation services.

The second change pertains to new chest X-ray codes, which will describe the number of views ordered rather than describe what those views entail. Codes 71010–71022 have been deleted in 2018 and have been replaced with codes 71045–71048. The new codes describe a radiological examination; chest single view; and then two, three, and four or more views, respectively.

Merit-Based Incentive Payment System (MIPS)

MACRA has had many long-lasting effects. The hated Sustainable Growth Rate (SGR) formula, which mandated years of potential draconian double-digit provider reimbursement cuts, no longer impacts provider payments. However, CMS has moved forward a much more complex quality-reporting program. The prior programs of the Physician Quality Reporting System (PQRS), the Value-Based Modifier, and Meaningful Use have now been rolled up into the Merit-Based Incentive Payment System (MIPS). Under MIPS, providers will see reimbursement adjustments impacting 2020 payments based on 2018 reporting in four categories:

• Quality
• Resource use
• Improvement activities

Meaningful use of an electronic health record (EHR) system

For the 2018 performance year (impacting 2020 payments), the four MIPS categories will be simplified for most emergency physicians. The final rule assigned the resource use category a weighting of 10 percent for 2018 (likely increasing to 30 percent for 2019). In addition, if providers deliver more than 75 percent of their Medicare services in an emergency department, they are excused from the meaningful use of EHR component. The consolidated program is then reweighted in 2018 to 75 percent quality (the old PQRS program), 10 percent cost, and 15 percent improvement activities (see Table 2).

(click for larger image) Table 2. 2018 MIPS Scoring for Most Typical Emergency Providers

Unlike the SGR’s annual changes, MIPS adjusts physician payments based on performance. MIPS does not have an aggregate spending target, which is what previously created the need for annual congressional patches to prevent the mandated SGR cuts. MIPS started in 2017 at ±4 percent and increases to ±9 percent by 2022 (based on 2020 performance).

Future Changes to the Medicare 1995 and 1997 Documentation Guidelines

CMS has become concerned that the current documentation guidelines, particularly the burdensome aspects of history and physical exam documentation, have not kept pace with technology and has discussed moving to a set of guidelines that are more centered on medical decision making.

Ultimately, in the 2018 Physician Final Rule CMS stated: “Stakeholders have long maintained that both the 1995 and 1997 guidelines are administratively burdensome and outdated with respect to the practice of medicine, stating that they are too complex, ambiguous, and that they fail to distinguish meaningful differences among code levels. In general, we agree that there may be unnecessary burden with these guidelines and that they are potentially outdated, and believe this is especially true for the requirements for the history and the physical exam.”

Stay tuned, as CMS has forecasted making substantial revisions in the near future.

Dr. Granovsky is the president of Logix Health, an ED coding and billing company, and serves as the course director of ACEP’s coding and reimbursement courses as well as ACEP’s Reimbursement Committee. Mr. McKenzie is reimbursement director for ACEP