The 2021 Medicare Physician Fee Schedule (MPFS) included a revaluation of the work relative value units (wRVUs) for many office/outpatient evaluation and management (E/M) services, such as codes 99202-99215. The expected result was an increase of more than 10% in Medicare payments for primary care physicians — and a decrease for some specialists, due largely to a 3.3% decrease in the Medicare conversion factor.
Given the significant increases in wRVUs for E/M services, many primary care physicians have been asking, “Why hasn’t my pay increased?” There are two main factors to consider:
1. The payment and bonus terms in your employment contract
Employed physician compensation often includes a base salary plus a productivity bonus based on wRVUs, collections, etc. If wRVUs make up a significant portion of your compensation formula, your pay should have increased under the new values. To calculate the impact of the increased wRVUs, check out the 2021 wRVU Variance Calculator. If your pay didn’t increase, a key factor to consider is whether your employer revised its compensation plan at the start of 2021. Many employers anticipated that adopting the 2021 wRVU increases for primary care would have been financially untenable while overall revenues were declining due to COVID-19, the reduced conversion factor, and other reasons. Instead of using the new wRVUs in the 2021 MPFS, they may have continued using the wRVUs in the prior year’s fee schedule. Or they may have adopted the new wRVUs but adjusted other parts of the compensation formula, such as the conversion factor or base pay, to help alleviate the economic impact.
Employers that continue to compensate physicians at pre-2021 levels are not passing along the meaningful investments in primary care called for in the 2021 MPFS. Physicians should check their contracts, ask their employers about any discrepancies, and renegotiate as needed. The American Academy of Family Physicians has developed a letter template physicians can use as they advocate with their employers for fair compensation.
Note that your non-Medicare payers may not yet have adopted the wRVU increases in the MPFS. Payment for commercial payers is based on negotiated contracts, which may need to be renegotiated.
2. Your productivity and coding patterns
It’s also possible that your productivity levels aren’t as high as they were pre-COVID due to lower office-visit volumes, which can affect your productivity bonus. Or perhaps your productivity just appears lower due to undercoding under the new E/M coding rules. To evaluate coding patterns, groups can run a report of the frequency with which CPT codes 99202-99215, 99354-99356, 99417, etc., have been billed in 2021 per clinician. The report should be adjusted to take into account patient volume. The same report can be run for 2020 to compare billing patterns. (The Centers for Medicare & Medicaid Services publishes E/M code frequency by specialty, but the data is not yet available for 2020 or 2021.) A chart audit or root cause analysis can then be performed to identify why undercoding may exist and whether clinicians and coders may need some additional coding education.
Physicians’ services may be undercoded for a number of reasons. First, as part of the 2021 changes to E/M coding for outpatient/office settings, clinicians can choose to bill based on total time spent. Both face-to-face time and non-face-to-face time personally spent by the physician or other qualified health care professional on the date of the encounter counts toward total time. The 2021 guidance allows physicians to include the following activities:
The American Medical Association (AMA) guidance does not require physicians to delineate how much time they spent on each component of the visit. Total time is sufficient. Though it may seem cumbersome, failing to track total time for the visit could result in undercoding of the services rendered.
Another cause of undercoding is lack of documentation in physician notes. Coders can only code based on what is charted. The completeness of the documentation of services rendered may affect the level of E/M services that can be billed using time or medical decision making (MDM). Some examples in which failure to completely document E/M services may affect reimbursements are listed below:
The 2021 E/M code revaluation should have resulted in an investment in primary care. Employers that did not implement these changes will have to wrestle with them again in 2022. Physicians may need to address these issues with their employers and examine their coding patterns to ensure they are being reimbursed adequately for their work.
— Sabrina Skeldon, JD, CPC-A, CIA, CCEP, CHC, CFE
1. CPT Evaluation and Management (E/M) Office or Other Outpatient (99201-99215) and Prolonged Services (99354, 99355, 99356, 99417) Code and Guideline Changes. AMA; 2021:7.
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