CPT fee differentials and visit upcoding under Medicare Part B.

Medicare Part B pays outpatient physicians according to the billed Current Procedural Terminology (CPT) codes, which differ in procedure and intensity. Since many performed services merely differ by intensity, physicians have an incentive to upcode services to increase profitability of a visit. Using nationally representative data from the 2001 to 2003 Medicare Current Beneficiary Survey, this paper explores the effect of Medicare Part B fee differentials on the upcoding of general office visits (i.e. for established patient visits with CPT codes of 99212-99215). It finds strong evidence that these fee differentials influence physician's coding choice for billing purposes across a variety of specialties. For general office visits, Medicare outlays attributable to upcoding may sum to as much as 15% of total expenditures for such visits. Medicare has much to gain financially by clarifying its classification rules. Until the distinctions between types of Medicare visits are redefined in a way that eliminates ambiguity, upcoding under Medicare Part B is likely to continue.

Facts you should know about ordering/referring providers for Medicare Part B items and services.

To avoid Medicare Part B claim rejection, wound care providers and suppliers, who are qualified to bill Medicare Part B, should ensure that they are correctly and currently enrolled in the Internet-based PECOS. In addition, wound care providers, who are billing for Medicare Part B-covered items and services that were ordered or referred, need to ensure that the physicians and nonphysician practitioners from whom they accept orders and referrals have current Medicare enrollment records (ie, they have enrollment records that contain their NPIs in PECOS) and are of a type/specialty that is eligible to order or refer in the Medicare program.Wound care providers can verify this by checking the Internet-based Ordering Referring Report. If ordering/referring providers are not yet enrolled in PECOS, remind them that time is running out before the full implementation of the Medicare Part B claims edits on January 3, 2011! For a complete review of the ordering/referring edit process, visit http://www.cms.gov/MLNMattersArticles/downloads/SE1011.pdf.

Reducing patient financial liability for hospitalizations: the physician role.

With increasingly strict guidelines for insurance coverage, hospitals have adopted meticulous resource utilization review and management processes. It is important for physicians to appreciate that careful documentation of certain patient parameters may not only optimize the facility's reimbursement but have profound impact on the patient's out-of-pocket expenses. Hospital utilization teams have access to the frequently changing national payor guidelines for policy benefits, usually revolving around whether the patient meets medical necessity criteria for being classified as an "inpatient" vs. an "observation" outpatient. Those statuses are not merely time-based, and lead to marked differences in patient deductibles and coverage for medication, room, procedure, laboratory, and ancillary charges. There are nationally-recognized guidelines for classification, based on severity of illness and intensity of services provided. By participating in case management activities, physicians can have an important patient advocate role, and thereby minimize the financial burden to these individuals and their families.

Sensitivity of billing claims for cardiovascular disease events among kidney transplant recipients.

BACKGROUND AND OBJECTIVES: Billing claims are increasingly examined beyond administrative functions as outcomes measures in observational research. Few studies have described the performance of billing claims as surrogate measures of clinical events among kidney transplant recipients. DESIGN, SETTING, PARTICIPANTS, & MEASUREMENTS: We investigated the sensitivity of Medicare billing claims for clinically verified cardiovascular diagnoses (five categories) and procedures (four categories) in a novel database linking Medicare claims to electronic medical records of one transplant program. Cardiovascular events identified in medical records for 571 Medicare-insured transplant recipients in 1991 through 2002 served as reference measures. RESULTS: Within a claims-ascertainment period spanning +/-30 d of clinically recorded dates, aggregate sensitivity of single claims was higher for case definitions incorporating Medicare Parts A and B for diagnoses and procedures (90.9%) compared with either Part A (82.3%) or Part B (84.6%) alone. Perfect capture of the four procedures was possible within +/-30 d or with short claims window expansion, but sensitivity for the diagnoses trended lower with all study algorithms (91.2% with window up to +/-90 d). Requirement for additional confirmatory diagnosis claims did not appreciably reduce sensitivity. Sensitivity patterns were similar in the early compared with late periods of the study. CONCLUSIONS: Combined use of Medicare Parts A and B billing claims composes a sensitive measure of cardiovascular events after kidney transplant. Further research is needed to define algorithms that maximize specificity as well as sensitivity of claims from Medicare and other insurers as research measures in this population.

Pilot study comparing patients' valuation of health-care services with Medicare's relative value units.

BACKGROUND AND AIMS: Physician reimbursement for services and thus income are largely determined by the Medicare Resource-Based Relative Value Scale. Patients' assessment of the value of physician services has never been considered in the calculation. This study sought to compare patients' valuation of health-care services to Medicare's relative value unit (RVU) assessments and to discover patients' perceptions about the relative differences in incomes across physician specialties. DESIGN: Cross-sectional survey. PARTICIPANTS AND SETTING: Individuals in select outpatient waiting areas at Johns Hopkins Bayview Medical Center. METHODS: Data collection included the use of a visual analog 'value scale' wherein participants assigned value to 10 specific physician-dependent health-care services. Informants were also asked to estimate the annualized incomes of physicians in specialties related to the above-mentioned services. Comparisons of (i) the 'patient valuation RVUs' with actual Medicare RVUs, and (ii) patients' estimations of physician income with actual income were explored using t-tests. OUTCOMES: Of the 206 eligible individuals, 186 (90%) agreed to participate. Participants assigned a significantly higher mean value to 7 of the 10 services compared with Medicare RVUs (P<0.001) and the range in values assigned by participants was much smaller than Medicare's (a factor of 2 vs. 22). With the exception of primary care, respondents estimated that physicians earn significantly less than their actual income (all P<0.001) and the differential across specialties was thought to be much smaller (estimate: $88,225, actual: $146,769). CONCLUSION: In this pilot study, patients' estimations of the value health-care services were markedly different from the Medicare RVU system. Mechanisms for incorporating patients' valuation of services rendered by physicians may be warranted.

Managed care enrollment and chronically disabled women with breast cancer.

OBJECTIVE: To assess whether managed care enrollment or healthcare utilization level among women enrolled in Medicare because of disability affects stage at diagnosis and treatment of breast cancer. STUDY DESIGN: Retrospective study using the Surveillance, Epidemiology, and End Results-Medicare database. We compared breast cancer stage at diagnosis and treatment among women with disabilities enrolled in Medicare managed care versus fee-for-service (FFS) Medicare. Women enrolled in FFS Medicare were classified into levels of healthcare utilization during the 6 to 18 months before breast cancer diagnosis. METHODS: Controlling for confounders, we used regression models to determine the effects of managed care enrollment and healthcare utilization level on earlier stage at diagnosis and treatment of breast cancer. RESULTS: Disabled patients enrolled in FFS Medicare without contact with the healthcare system and those with fewer than 12 physician visits during the 6 to 18 months before breast cancer diagnosis were more likely than disabled patients enrolled in Medicare managed care to be diagnosed as having breast cancer at a late stage. There was no difference between women enrolled in Medicare managed care versus women enrolled in FFS Medicare having at least 12 physician visits during the 12-month period. Breast cancer treatment for women with disabilities did not vary across managed care enrollment or healthcare utilization level. CONCLUSION: Managed care enrollment or increased contact with healthcare providers could result in earlier stage at breast cancer diagnosis.

Using knowledge of multiple levels of variation in care to target performance incentives to providers.

BACKGROUND: In developing "pay-for-performance" and capitation systems that provide incentives for improving the quality and efficiency of care, policymakers need to determine which healthcare providers to evaluate and reward. OBJECTIVES: This study demonstrates methods for determining and understanding the relative contributions of facilities and physicians to the quality and cost of care. Specifically, this study distinguishes levels of variation in resource utilization (RU), based on research to support the development of an expanded Medicare dialysis prospective payment system. RESEARCH DESIGN: Mixed models were used to estimate the variation in RU across institutional providers, physicians, patients, and months (within patients), after adjusting for case-mix. SUBJECTS: The study includes 10,367 Medicare hemodialysis patients treated in a 4.2% stratified random sample of dialysis facilities in 2003. MEASURES: Monthly RU was measured by the average Medicare allowable charge per dialysis session for separately billable dialysis-related services (mainly injectable medications and laboratory tests) from Medicare claims. RESULTS: There was financially significant variation in RU across institutional providers and to a lesser degree across physicians, after adjusting for differences in case-mix. The remaining variation in RU reflects unexplained differences across patients that persist over time and transitory fluctuations for individual patients. CONCLUSIONS: The greater variation in RU occurring across dialysis facilities than across physicians is consistent with targeting payments to facilities, but alignment of incentives between facilities and physicians remains an important goal. Similar analytic methods may be useful in designing payment policies that reward providers for improving the quality of care.

Institute of Medicine recommends new P4P system for Medicare.

IOM asserts fee-for-service program actually discourages quality improvement. Report claims jury is still out on approach; current research contains conflicting results. Ten design principles recommended for pay for performance and its implementation.

Reimbursement for carotid stenting: unique challenges for medical centers and physicians.

Carotid artery stenting has been identified as an important therapeutic option for patients with atherosclerotic occlusive disease of the extracranial carotid artery. While the preferred application of this technology remains an area of active clinical investigation and its optimal role may continue to evolve, a preponderance of opinion supports its present application in carefully selected patients. Enabling the introduction of this technology into the broader patient community mandated a consensus between a large number of specialty societies and the Centers for Medicare and Medicaid Services to define both currently acceptable procedures to be performed and appropriate clinical criteria for its suitable application. This report reviews the collaborative process, which evolved to achieve this consensus and the current guidelines for procedural coding, facility accreditation, and reimbursement for carotid artery stenting. Related requirements for Medicare coverage of patients in clinical trials and registries are also discussed.