In January 2021, proposed reimbursement changes by the Centers for Medicare & Medicaid Services are scheduled to take effect for E/M office visit guidelines and pay rates. The changes are significant and will not only affect otolaryngology but will have ripple effects on the business of medicine.
Explore This IssueNovember 2020
Work on these changes has been ongoing for years; many will question the timing of their implementation in the middle of a pandemic. Despite protests from various specialty organizations and hospital associations that will be most negatively impacted, it appears they will occur. The business of medicine is never boring, and these changes will impact the way we operate our practices, like it or not.
Between July 2018 and July 2019, the AMA, specialty societies, and other health professionals worked with CMS to simplify and streamline the coding and documentation for E/M office visits. Key elements of the overhaul included eliminating HPI elements for code selection and allowing physicians to bill and chart on medical decision making or total time caring for the patient.
The intent was noble—decreasing government administrative burden on physicians and paying us for the time needed to take care of our patients. Finishing our charts after clinic is a major burden and a major contributor to physician burnout. A recent New England Journal of Medicine study of family physicians tracked their EHR use by time of day. There were obvious spikes during work hours, but the next largest spike was between 8 and 11 p.m. “Reducing documentation overload and providing physicians more time with patients, not paperwork, was the fundamental purpose,” said Susan Bailey, AMA president.
Relative value units to E/M codes will increase along with an increase in the level of coding, with proposed additional spending at $10.2 billion. But, in adherence to Medicare’s budget neutrality requirement, it will result in a roughly 11% reduction in the Medicare conversion factor.
So, what does that mean for us? Our specialty has a mixture of E/M and CPT codes, and otolaryngology as a whole is estimated to have a 7% increase in RVUs. There won’t be a change in CPT codes, and the 11% reduction in payment will make both in-office and operating room surgeries less lucrative. For physicians who work for academic health centers and hospitals, there will be a redistribution of wealth. The vast majority of these systems compensate by a dollar-per-RVU model, so the proposed 11% reduction will bring down the salaries of proceduralists and increase those in the medical subspecialties. Within otolaryngology, subspecialties that are largely procedure based, such as head and neck oncology, will see a decrease in compensation. Those that are more E/M based, such as otology and laryngology, will see an increase.
And for our private practice colleagues? Assuming their practice accepts Medicare, practitioners who spend most of their week in the office should see an increase in compensation. What about physician-owned surgery centers and health systems that have built their operating strategy around filling operating rooms and ICUs? This remains to be seen, as margins may not be what they once were.
Colleagues in hospital-based specialties where there’s little E/M work (anesthesiology, radiology, neurosurgery, vascular surgery) are predicted to take some of the biggest hits in reimbursement, with an expected drop in compensation. Will their residencies become less popular with medical students? What will happen to their workforce if volumes need to be ramped up to cancel out the reimbursement drop? And is this the first step toward greater valuation of E/M codes over CPT codes as a way of reining in healthcare costs?
Unfortunately, it looks like the 2020 chaos will only worsen in 2021. Hang in there, folks—there has to be a light at the end of the tunnel somewhere! Stay safe and talk to you soon.