Pulmonology Coding Alert

In a news release dated Nov. 1, 2000, HCFA announced a fee increase effective at the beginning of calendar year 2001. The overall rate increase is 4.5 percent, but increases for specific services will vary because a new payment system is being implemented for physician practice expenses.

The Nov. 1, 2000, Federal Register lists the final fee schedule rate, including more than 7,000 services and procedures covered by Medicare, from routine office visits to complex surgery. In 2001, Medicare will pay about $40 billion for physician services, up from $37 billion in 2000.

According to HCFA, The new payment system for physician practice expenses, also required by law, is based on resources involved in providing care, rather than on physicians historical charges. Resource-based values for the physicians work were implemented several years ago, and we are currently implementing resource-based values for the expenses associated with physicians practices. In this the third year of a four-year phase-in of the new system, 75 percent of physician fees will be based on the new system and 25 percent will be based on physicians historical charges. Payments for 2002 will be entirely based on the new system.

The change to a resource-based system explains the variations in specialty. The change in payment rates between 2000 and 2001 is the result of the update, the transition to the resource-based practice expense payment system, technical changes in the pricing for various services, as well as updated data on malpractice insurance premiums, HCFA says. Payment changes by physician specialty vary mostly as a result of the transition to resource-based practice expense payments.

Reimbursements Up for Pulmonologists

For example, pulmonologists can expect higher reimbursement for simple pulmonary stress tests (94620, pulmonary stress testing; simple [e.g., prolonged exercise test for bronchospasm with pre- and post-spirometry]). In 2000, these stress tests had 105.81 relative value units (RVU). But in 2001, they will have 125.14 RVUs.

Pulmonology reimbursement will go up by 3 percent, but thoracic surgery will decrease by 1 percent. Cardiac surgery is also being reduced by 1 percent. HCFA explains that cardiac and thoracic surgeons whose historical charges were substantially higher than resource-based rates will experience a small decline in payments.

Acting HCFA Administrator Michael Hash says, We will continue working with physicians to refine our methodologies to enhance benefits for seniors and ensure that payments are as accurate as possible when they are completely based on the new, resource-based system.

HCFA and Physicians Working Together

How does HCFA work with physicians? Physicians try to gather information from their community so they can supply HCFA with accurate data about practice expenses. Their goal is to make the resource-based system reflect their real situation.

Walter J. ODonohue Jr., MD, FCCP, [...]