AAFP Chides CMS for Proposed Work RVU Revisions

Message: Accept RUC-recommended Values for Observation Care

August 10, 2011 05:10 pm Sheri Porter

In a recent letter to CMS Administrator Donald Berwick, M.D., the AAFP reproached the agency for revisions to certain work relative value units, or RVUs, it has proposed in its statutorily mandated five-year review of RVUs. Specifically, the Academy objected to the work RVUs CMS has proposed for CPT codes that involve patient observation -- namely, codes 99218-99220 and 99234-99236.

For three of those codes, CMS has recommended no change from the current RVUs; the remaining three would be reduced as of Jan. 1.

At issue, says the AAFP in a July 25 comment letter(3 page PDF) to the agency, is that CMS has rejected input from the AMA/Specialty Society Relative Value Scale Update Committee, or RUC, on the appropriate valuation for these RVUs. The RUC acts as an expert panel and makes recommendations to CMS on the relative values of CPT codes.

[Large Comp. Chart for Observation Care]

"In each case, CMS chose to ignore the RUC's recommended values," said AAFP Board Chair Lori Heim, M.D., of Vass, N.C., in the letter.

In its proposal, which was published in the June 6 Federal Register(www.gpo.gov), CMS explained its decisions by saying that the acuity level of a typical patient receiving outpatient observation services would usually be lower than that of a patient being observed as a hospital inpatient.

Story Highlights

  • In its recent five-year review of work relative value units, or RVUs, CMS ignored recommendations from the AMA/Specialty Society Relative Value Scale Update Committee regarding RVUs for CPT codes involving patient observation.
  • The AAFP responded with a strongly worded letter urging CMS to reconsider its position.
  • If CMS' proposed RVUs stand, family physicians who provide observation services face decreased payment based on the percentage that a given RVU is cut.

"We (CMS) believe that if the patient's acuity level is determined to be at the level of the inpatient, the patient should be admitted to the hospital as an inpatient," said the agency.

"We are extremely disappointed by CMS' proposal in this regard," Heim responded. "CMS' perception of what 'should be' bears no resemblance to what 'is' when it comes to patients' inpatient or observational care status," she noted, adding that CMS was making an assumption that was not documented as fact.

"We have yet to see any evidence from CMS to support its contention in this regard," said Heim. In fact, she added, "The criteria for inpatient status versus observational status do not distinguish between severity of illness, acuity or the work required."

She noted that a patient admitted for chest pain or acute blood loss often would be admitted to "observational status," but that patient would require the same diagnostic evolution and professional consideration of risks that an inpatient would.

"A patient kept in observation as an outpatient for 23 hours may be as sick or sicker -- and require as much or more physician work -- as a patient admitted as an inpatient for the same time period," said Heim. Often, a patient's condition changes during the observational period, and he or she is either discharged or admitted as an inpatient, she added.

"We strongly urge the agency to reverse its position and accept the RUC-recommended values for observation care services so family physicians and others may be appropriately compensated for the work involved in caring for hospital patients, regardless of the patients' nominal status as inpatient or observational," said Heim.

"Traditionally, CMS has accepted somewhere in the range of 95 percent of RUC recommendations," said Walter Larimore, M.D., of Monument, Colo., who currently serves as the AAFP's representative to the RUC. "But in this set of codes -- not just these observation codes, but the whole group of codes that recently were sent to CMS for review -- only about 70 percent were accepted."

That degree of nonacceptance is uncharacteristically high, Larimore told AAFP News Now, and has fueled angst among numerous stakeholder groups.

"In the case of these particular codes, all of the cognitive-care specialties have risen up in revolt and said, 'This nonacceptance is just not appropriate,'" he noted. In fact, Larimore and representatives from the American College of Physicians, the American Geriatrics Society and the American College of Emergency Physicians met face-to-face with CMS officials on July 19 to outline their concerns.

In response to CMS' contention that patients admitted to observation are less acute than those admitted as inpatients, Larimore said the Academy and other cognitive specialty organizations, as well as the AMA, have explained that decisions regarding whether patients are put in observation or admitted are made by hospitals -- not physicians -- and have nothing to do with acuity.

Furthermore, he said, "The work that the doctor does to admit someone to observation is the same exact work as admitting someone to the hospital. It's the same history and physical form, the same dictation, the same hospital forms, and it's the same discharge summary."

If CMS finalizes the lower valuations, family physicians who provide those services will see decreased payment based on the percentage that a given RVU is cut.

"But this is more than a reimbursement issue," said Larimore. "My argument to CMS is that this is a fairness issue. With patient admission to the hospital, the ER may call me in the evening and admit someone, and I can call in orders; I may not see the patient until the next morning."

Not so with a patient in observation. Larimore said he often makes two trips to the hospital in a single day's time in that situation -- one for admission and one for discharge.


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