Ophthalmology and Optometry Coding Alert

Caution: Expect reduction in E/M code reimbursement

If the proposed 2008 physician fee schedule that CMS released in July goes through as planned, the  reimbursement for services your ophthalmologist provides to Medicare patients will face an across-the-board 9.9 percent cut next year.

Good news: Optometrists and ophthalmologists rank among the best faring specialties under CMS- 2008 proposal, whereas specialties such as cardiologists, emergency physicians, neurosurgeons and others are getting hit hard. Ophthalmology services will face a 9 percent cut, while other specialties may face cuts as high as 12 percent.

Be Cautiously Hopeful Congress Will Act

There is some hope: Congress may step in to save you from such a steep cut just as it has in past years. Congress acted at the very last minute to prevent a steep cut to your reimbursement in January 2007 by approving and passing a freeze that kept the conversion factor (CF) at the current 2006 rate of 37.8975 instead of decreasing it to the scheduled 2007 rate of 35.9848.

No one can guess yet whether Congress will step in again for next year, experts say. -However, even if Congress steps forward and reduces the 9.9 percent cut, there are other subtle areas that will be cut regardless of Congress,- says Gail Lorenzen, CHBC, senior consultant with The Sage Group in Phoenix.

Example: The budget neutrality work adjustor will be reduced to 0.8816 from 0.8994 next year. This means your physicians- work payments will drop another 1.7 percent in 2008, mainly affecting your E/M reimbursement, Lorenzen  says. One of the most frequently billed services, 99213 (Office or other outpatient visit for the evaluation and management of an established patient ...), will be reduced from $59.50 to $58.73.

-A practice's payments are calculated from a formula based on three components: physician work, practice expense, and malpractice, all adjusted for geographic variations,- Lorenzen says. -Changes to any of these elements impact your payments.-

In addition: Your geographic price cost index (GPCI) may change and mean further cuts in 2008 payments. Your reimbursement is set to face an additional drop if you live in 56 of 89 payment localities where the work GPCI is typically less than 1.0, CMS said in the proposed fee schedule. Of note is that the provision passed by Congress to set a minimum 1.0 GPCI nationwide for work relative value units (RVUs) expires at the end of 2007.

If you-re in North Dakota or Montana, for example, your work GPCI would fall by about 3 percent due to removal of the work GPCI floor and further impacted by proposed geographic adjustment factor (GAF) revisions that would create an additional 0.82 percent and 0.45 percent decrease.

Bulk-Discount Elimination Means More Money

The bright side: CMS decided to accept a number of recommendations from the AMA's Relative Value Update Committee (RUC) that it ignored last year.

More money: And CMS will adjust the work RVUs for more than 50 procedures, in line with the RUC's recommendations. Work RVUs will go up for 33 codes and decrease for 10 codes.

Most nursing facility care codes (99304-99310) will see RVU increases. But payment for your ophthalmologist's home visits (99341-99350) will stay the same, instead of increasing as some physicians had requested.

Good news: CMS is also revising the way it calculates payments for Part B drugs. Medicare will force drug manufacturers to allocate their -bundled price concessions- when they report drug costs. That may mean you won't lose so much money on drugs because large organizations are getting bulk discounts and driving the average prices down.

Tip: Visit the AMA's Web site at www.ama-assn.org/ama/pub/category/14332.html for information that will -help everyone from providers to billers to patients understand what is happening and their proposed changes to help,- says Denae M. Merrill, CPC-E/M, coder for Covenant MSO in Saginaw, Mich.