New Medicare Documentation And Payment Changes Starting Next Year That Deliver Relief For Clinicians

Starting on January 1, 2021, clinicians across the country can expect new Medicare rules on billing, documentation, and payment for evaluation and management (E/M) services — or common office/outpatient visits – to go into effect. These historic changes will give clinicians more flexibility in how they document visits in their patients’ medical record, reduce their paperwork burden and give them more time to spend with patients. With over 750,000 clinicians providing common office visits to Medicare beneficiaries, comprising 20% of Medicare spending to clinicians, these changes will have a far-reaching impact for clinicians and patients alike.

The landmark changes to documentation and coding for E/M services for billing Medicare—the first in about 25 years—come after extensive stakeholder feedback, and collaboration between CMS and the AMA Current Procedural Terminology (CPT) Editorial Panel (the organization that maintains the billing codes and guidelines). As part of the Patients over Paperwork initiative that aimed to reduce the burden of unnecessary rules and requirements, in 2017, CMS went on a national listening tour to hear from clinicians on the frontlines about how CMS rules affect their care of patients. We heard concerns ranging from the burdensome number of quality measures that clinicians were required to report, to outdated regulations that hindered their ability to coordinate care for their patients. Recognizing that these and other administrative burdens contribute to physician burnout or moral injury, we have tackled these issues including through our Meaningful Measures Initiative to reduce the number of Medicare quality measures and ease the burden on providers, and most recently, through our physician self-referral rules, also known as the “Stark Law,” to remove impediments for physicians to provide care coordination, a crucial component for physicians to engage in value-based care.

However, one common concern we heard from clinicians was the amount of time wasted entering unnecessary information in their patients’ medical records for the purposes of billing Medicare. They noted that the documentation requirements were based on guidelines developed in the 1990s that did not reflect the current practice of medicine or the advent of the electronic health record, and contributed to ever-mounting stacks of paperwork or “note bloat.” For example, physicians have been required to document a patient’s history and physical exam to select the level of code for office/outpatient E/M visits for billing purposes, even if this information was already contained in the patient’s medical record or was not clinically necessary.

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Last year, after a year-long dialogue with the AMA and others, CMS announced that it would adopt the CPT coding and documentation changes for E/M services that go into effect January 1, 2021. This gave clinicians a year to implement these changes in their practices. The changes reduce administrative burden for coding and documentation and reduce unnecessary documentation that is not needed for patient care.

A summary of those changes include:

• Retaining 5 levels of coding for established patients, reducing the number of levels from 5 to 4 for office/outpatient E/M visits for new patients, as well as revising the code definitions.
• Revise the times and medical decision-making process for each outpatient/office E/M codes and perform a patient history and physical exam only as medically appropriate.
• Allowing clinicians to document and choose the E/M visit level for billing purposes based on either medical decision-making or time. Currently, time could be used to document and select an E/M visit level if the visit is predominantly for counseling. Starting in January, clinicians can document based on total time spent for a patient’s visit and use time to determine the E/M visit level across all outpatient/office visits. Additionally, the guidelines around medical decision making which were developed in the 1990s have been updated to remove ambiguity for clinicians. They also eliminate using patient history and physical exam as required elements for selecting the billing code level, so clinicians will not have to document this information unless they perform it as medically appropriate.

These changes apply to the following E/M codes for office/outpatient visits: CPT codes 99201, 99202, 99203, 99204, 99205, 99206, 99207, 99208, 99209, 99210, 99211, 99212, 99213, 99214 and 99215.

All told, we’ve estimated that these changes will reduce time spent on paperwork by about two million hours annually, but more importantly allows clinicians to spend more time with patients.

Along with these documentation and coding changes, CMS is increasing Medicare payment for these E/M visits after clinicians pointed out that Medicare payment has not kept up with the demands and complexity involved in E/M visits. With over 10,000 beneficiaries joining the program every day, the Medicare population is growing more complex in their health care needs. More than two-thirds of Medicare’s beneficiaries have two or more chronic conditions. Furthermore, according to internal Medicare fee-for-service claims analysis data as of February 2020, the percentage of beneficiaries with six or more chronic conditions has grown from 14.3% in 2014 to 17.7% in 2018.

On top of that, some parts of the country are facing a shortage of primary care clinicians that are often the first point of contact for patients in the health care delivery system and rely disproportionately on office/outpatient E/M visits for overall payment. Nationally, while the number of clinicians per Medicare Part B enrollee has grown 12.7% from 3,545 per 100,000 in 2014 to 3,996 per 100,000 in 2018, the number of primary care clinicians per 100,000 beneficiaries has remained relatively flat. In 2014, there were 679 primary care providers per 100,000 in 2014. In 2018, there were 682 providers per 100,000 in 2018 or a 0.4% increase in clinicians per 100,000.

The E/M codes’ valuation needed to be modernized to reflect the time and resources that clinicians spend taking care of patients such as primary care that is furnished across a wide range of specialties, from family medicine to behavioral health to gerontology. As a result, starting January 1, 2021, CMS is increasing payment of those E/M visits, informed by the American Medical Association’s recommendations and broad stakeholder input from over 50 medical specialty societies. These higher payments will better value clinician time and resources involved in patient care including managing chronic conditions, synthesizing information in electronic health records, evaluating genetic information, and addressing social determinants of health.

We thank the clinician community for their collaboration on improving the health care delivery system and for taking care of our patients. By reducing burden and valuing a physician’s time with patients, these changes will benefit clinicians and patients’ current and future generations.

Seema Verma is administrator, Centers for Medicare and Medicaid Services.

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