General Surgery Coding Alert

Higher E/M reimbursement leads to cuts elsewhere

Congress has reversed a proposed 5 percent decrease to the Medicare conversion factor for 2007 (leaving it at 37.8975, the same rate for 2005 and 2006), but that doesn't mean you won't see a change in Medicare payments.

The good news: CMS increased the relative values for many E/M codes, including outpatient visits 99204-99205 and 99213-99215; hospital care 99221-99223, 99231 and 99233; and outpatient and inpatient consults 99244-99245 and 99251-99255. As a result, the fees for these codes have increased.

The bad news: Because Medicare spending has to be budget neutral, an increase in some codes- relative values has to be offset by a reduction in other codes. The reductions are based on each code's use and their expected effect on the proposed budget. As a result, many procedures, both major and minor, have relative value reductions, and thus we will see reduced fees for these services.

The net effect on your practice will be determined by the ratio of E/M services that your practice provides to your procedures. Practices with heavy E/M billing will fair best -- although general surgery will suffer less from decreased procedure payments than other specialties (radiology, for instance, was hit especially hard).

You can view the 2007 physician fee schedule database, which lists relative values for all codes, on the CMS site www.cms.hhs.gov/PhysicianFeeSched/.