Anesthesia Coding Alert

Final rule for 2021 hits providers across specialties.

Get ready to see less on your bottom line in 2021, thanks to final payment information from the Centers for Medicare and Medicaid Services (CMS). The final rule with updates on policy changes for Medicare payments under the Physician Fee Schedule (MPFS) and other Medicare Part B issues was released on Dec. 1, 2020. Changes will go into effect Jan. 1, 2021.

Get The Lowdown on ACF Changes

The final calendar year (CY) 2021 anesthesia conversion factor (ACF) will be $20.0547. This is a decrease from the 2020 ACF of $22.2016, but is higher than the ACF originally proposed for 2021 (which was $19.96).

“Unfortunately, the Medicare conversion factor for anesthesia services has been historically lower than it should be when compared to commercial CFs,” says Kelly D. Dennis, MBA, ACS-AN, CAN-PC, CHCA, CPMA, CPC, CPC-I, owner of Perfect Office Solutions in Leesburg, Florida. “A $20 CF takes us back to the anesthesia CF from the 1980s.”

“The American Society of Anesthesiologists (ASA) has worked long and hard to help Medicare understand the disparity for anesthesia,” Dennis adds. “To fully understand, we go back to what the ASA called the 33 percent problem. Medicare undervalues the anesthesia CF. This is one of the main reasons why commercial insurance contracts should not be tied to the Medicare Fee Schedule during negotiations.”

Important: Remember that you won’t automatically apply the national ACF when calculating your claims. ACFs vary by state and/or geographic location because of local economic and practice expense factors. You’ll use the specific ACF for your geographic area.

Also, the ACF is only one component to figuring your provider’s reimbursement. Payments for anesthesia services are based on this formula:

(Time Units + Base Units) X Conversion Factor = Allowance

• Base units = Anesthesia procedure performed has an assigned code and each code has a base unit value
• Time units = Amount of time taken for each anesthesia procedure
• Conversion factor = Cost assigned for each unit and are specific to the location of the anesthesia provider
• Total anesthesia charge = The total number of units together multiplied by the conversion factor

Don’t Forget Payment for Non-anesthesia Services

Physicians are facing a 10.2 percent drop in the Medicare CF for other procedures. CMS finalized the CY 2021 CF at $32.41 (the 2020 CF was $36.0896). Again, this is better than the 11 percent rate cut that CMS proposed in August.

Why you should care: The national CF is what you use when calculating payment when your providers perform surgical services such as postoperative pain management blocks, invasive line placements, emergency intubations, and TEEs, reminds Dennis.

CMS said the cut is needed to counter the increased fees for office or other outpatient evaluation and management (E/M) visit codes (99202-99215). Office visits account for 20 percent of fee schedule spending and have been a longstanding focus of the agency and the wider medical practice industry.

Pay attention: In 2021, you will use either medical decision making (MDM) or time to choose a level of service when selecting E/M office visit codes. That means, for code selection purposes, you can ignore the history and exam elements that long defined E/M codes.

“The clinically outdated system for number of body systems/areas reviewed and examined under history and exam will no longer apply, and the history and exam components will only be performed when, and to the extent, reasonable and necessary, and clinically appropriate,” CMS states. “We continue to believe these policies will further our ongoing effort to reduce administrative burden, improve payment accuracy, and update the O/O [office/outpatient] E/M visit code set to better reflect the current practice of medicine.”

In terms of the updated E/M code set, remember to read over the new guidelines so you can code accurately, said AMA President Susan R. Bailey, MD, in a Sept. 1 news release about the updates to the 2021 code set. “To get the full benefit of the burden relief from the E/M office visit changes, health care organizations need to understand and be ready to use the revised CPT^® codes and guidelines by Jan. 1, 2021,” she said.

Watch for Other Notable Anesthesia Updates

Numerous policy changes have gone into effect during 2020 because of the COVID-19 pandemic. CMS has finalized some of these changes even beyond the public health emergency (PHE).

One of these is the May 1, 2020, COVID-19 IFC (85 FR 27550 through 27629) to allow nurse practitioners (NPs), clinical nurse specialists (CNSs), physician assistants (PAs), and certified nurse-midwives (CNMs) to supervise the performance of diagnostic tests within their scope of practice and state law. Certified registered nurse anesthetists (CRNAs) now have been added to this list. These practitioners must maintain the required statutory relationships under Medicare with supervising or collaborating physicians.

“In addition to state scope of practice, anesthesia groups should also ensure the facility allows this service under the CRNA Delineation of Privileges,” Dennis says. “Each practice also will need to determine whether malpractice allows for it through their own carrier.”

Documentation requirements: In the CY 2020 MPFS final rule, CMS finalized broad modifications to the medical record documentation requirements for physicians and certain nonphysician practitioners (NPPs). The CY 2021 MPFS final rule clarifies that physicians and NPPs, including therapists, can review and verify documentation entered into the medical record by members of the medical team for their own services that are paid under the MPFS. The final rule also clarifies that therapy students and students of other disciplines, working under a physician or practitioner who furnishes and bills directly for their professional services to the Medicare program, may document in the record so long as the documentation is reviewed and verified (signed and dated) by the billing physician, practitioner, or therapist.

NCD removal: Several outdated or obsolete National Coverage Determinations (NCDs) will be removed, effective Jan. 1, 2021. According to CMS, “Removing outdated NCDs means Medicare Administrative Contractors no longer are required to follow those outdated coverage policies when it comes to covering services for beneficiaries. The result will allow flexibility for these contractors to determine coverage for beneficiaries in their geographic areas based on more recent evidence and information.”

For more information on all changes in the CY 2021 final rule, visit https://www.federalregister.gov/public-inspection/2020-26815/medicare-program-cy-2021-payment-policies-under-the-physician-fee-schedule-and-other-changes-to-part.