E/M changes: The future of medical necessity in 2021 and beyond
by Sean Weiss, Partner & VP of Compliance
You’ve probably heard that 2021 will be the year that E/M coding and documentation changes forever. Predictions of what will actually happen as a result of Medicare’s 2021 E/M revisions – which have gotten the AMA’s official stamp of approval with complementary 2021 CPT changes – run the gamut.
Some believe E/M coding will eventually become so straightforward and have so little impact on revenue (thanks to Medicare’s plan to implement blended payment rates for E/M levels 2-4) that many coders and auditors will find themselves out of a job. There are others who believe that the new coding paradigm, with add-on codes for primary care and specialists, with history and exam required, but watered down, and with all these changes restricted to the outpatient setting only, will result in more obstacles in the short term, while doing little to relieve physicians of the documentation burden in the long run. After all, if only Medicare goes through with these changes and the changes are limited to outpatient visits, will doctors really change how they document everything? Inpatient visits, consults, observation care, and commercial payers that don’t perfectly follow Medicare or CPT guidelines will muddy the waters.
So what is a practice administrator, compliance officer, coder, or auditor to do with such a range of speculation? What steps should you take in the face of such uncertainty, now just over a year and a half away? Well, let’s start with an unvarnished, critical, analysis of the E/M components and guidelines themselves. Please bear in mind this is my personal opinion, and feel free to disagree.
E/M components don’t impact plans of care
The key components of E/M services – history, physical examination, and medical decision making (MDM) – ultimately have little impact on the plan of care that is generated at the end of each E/M visit.
The number one reason that E/M components like history and exam have become less and less clinically useful is because of Electronic Health Records (EHRs) and the ease with which templates on a computer screen allow all the boxes to be checked. You can populate the maximum level of history and exam quickly and efficiently with the magic of EHR templates or even “carry forward” elements of history and exam from one visit to another. With maxed out histories and exams, it becomes easy to support higher levels of service, even though the medical necessity hasn’t changed.
At the same time, government auditors have tried to crack down on what they perceive as clinical plagiarism or EHR “note cloning,” even though such canned documentation is practically inevitable given the nature of EHRs. CMS describes its 2021 E/M changes as “administrative simplification,” but their real focus is on creating a way to consistently determine the actual substantive necessity for the higher E/M service levels (4 or 5), using the most clinical aspects of E/M coding: the MDM component and the less quantifiable concept of medical necessity.
I am aware of at least one major payer that instructs its auditors not to bother evaluating the objective (physical exam) portion of E/M notes, because in the words of one their supervisors: “We don’t really care, because regardless of whether they did it or not, we aren’t clinicians so we can’t argue in the majority of cases whether any specific exam element was medically appropriate.”
The history component fares only a little better in terms of clinical significance. Other than the history of present illness (HPI), which must still be performed by the billing provider, the review of systems (ROS) and past/family/social history (PFSH) serve no real purpose and assigning them a numerical value to support distinct “levels” of history (e.g. detailed, comprehensive) is clinically nonsensical and one of the purest expressions of healthcare “bean counting.” Think about it: ancillary staff or even patients themselves can perform the ROS and PFSH. Anything of significance (positive pertinent or negative findings) should already be captured by the provider in the HPI, which is why most physicians utilize the blanket statement “ROS is negative with the exception of pertinent positive/negatives as specified in the HPI.”
Even the separation of the history into HPI, ROS, and PFSH is a byproduct of the EHR era. Providers brought up on SOAP notes in medical school do not willingly segregate the history into these three acronyms. During residencies or fellowships, physicians learn to create encounter notes based on the SOAP (Subjective, Objective, Assessment, and Plan) format.
E/M levels in the real world
I spend almost all of my working hours focused on audit appeal defense, expert witness testimony and the drafting of reports in response to federal and state healthcare fraud investigations. I can tell you from the opinions written by judges and arbiters, and from the verdicts handed down by juries, that what really matters in most cases are three things. First, did the provider act in the best interest of the patient? Second, were services rendered in a safe and prudent manner? Third, did the provider’s documentation demonstrate the level of medical necessity required to provide and bill for the services?
A recent case in which I was retained to defend a physician facing 12 counts of fraud should prove particularly instructive on the points above. The District Attorney (DA) called an expert witness who had determined that the doctor didn’t follow the “E/M guidelines” to bill for the established patient visit code 99214 on multiple occasions for many patients.
For two weeks the DA had their expert testify as to missing elements of history, exam, and MDM. The expert expounded on all manner of E/M guidelines – Marshfield Clinic vs. AMA vs. CMS, 1995 vs. 1997 – all to try and say that not all of the required beans were present. To the uninitiated, this parade of guidelines, shaded and unshaded boxes, point scores for elements, and other arcane minutiae, must have made for a baffling if not sleep-inducing show.
Our defense was simple. We showed each of these patients to be long-term, established patients with multiple chronic, systemic diseases. We focused on the assessment and plan portions of the note, and how they related to the HPI captured by the physician. In all three of these clinically significant areas, we showed his documentation was ample. These areas of the note showed him ordering appropriate labs and tests, managing multiple medication regimens, issuing referrals to other subspecialists, and taking care of the problems the patients presented for.
Most importantly we showed how the “guidelines” were just that: guidelines rather than gospel. We showed how they varied between Medicare contractors (e.g. Novitas follows a 4×4 system for exams while others don’t) and commercial payers. We showed how even seasoned auditors can be inconsistent from audit to audit. Our defense lasted several hours versus the two-week show by the DA, and at the end of the day the jury required less than two hours to return a verdict of not guilty on all counts.
Please understand I am not advocating that your physicians discard the published guidelines. What I am suggesting is that your providers focus their attention and valuable time on documenting those areas of the greatest clinical significance: the HPI and the assessment and plan. The future of E/M coding will revolve around the unquantifiable concept of “medical necessity” and those areas are the best proxy for medical necessity. These areas of the note will also carry the greatest weight in their defense, should it become necessary to defend their billing.
— Sean M. Weiss, CHC, CEMA, CMCO, CPMA, CPC-P, CMPE, CPC (firstname.lastname@example.org). The author is a Partner, Vice President of Compliance at DoctorsManagement.