February 16, 2009

This week we are sending you an Alert that is longer than the usual e-mail you receive from us each Monday. 2009 promises to be a year with many changes in regulations, anesthesia coding and even legislation affecting our practices, and we hope that we are providing you with a valuable service by summarizing the top 10 – at least this week’s top 10 – below.

1. Transition from Medicare “Carriers” to “Medicare Administrative Contractors” (MACs)

CMS is in the middle of a multi-year process of transferring responsibilities for administering the Medicare program from the familiar “carriers” to “MACs,” as required by the Medicare Prescription Drug, Improvement, and Modernization Act of 2003. Many anesthesiologists are already submitting claims to the MAC for their area, in some cases after major transition difficulties.

Contracts for all 15 new MAC jurisdictions had been awarded as of January 9, 2009. On January 27, however, Noridian Administrative Services, LLC, which had been the carrier for a number of Western states and which was the successful bidder for the MAC contracts for 18 jurisdictions, received a stop-work order from CMS because a third-party had challenged the original award for Illinois, Minnesota and Wisconsin.

CMS has published a helpful Medlearn article, available at http://www.cms.hhs.gov/MLNMattersArticles/downloads/SE0837.pdf, that sets out a timeline with actions that physicians should take as they transition to their respective new MACs. Among the various recommendations, this may be the most important: that you check your MAC’s website regularly for updates, and subscribe to its mailing list if there is one. The MACs are expected to offer extensive provider education.

Education on the survival of current local carrier determinations (LCDs) or medical policies – or their replacement by policies adopted by the contractor in its previous incarnation, e.g., Noridian – will have to come from the American Society of Anesthesiologists, state medical associations, and your ABC representatives.

2. Coding Changes

Three significant changes to CPT™ codes reported frequently by anesthesiologists and pain physicians took effect in January:

• 00142, Anesthesia for procedures on eye; lens surgery. The ASA Relative Value Guide now lists 4 base units for cataract procedures instead of 6. Medicare has allowed 4 base units only for many years.
• 00562, Anesthesia for procedures on heart, pericardial sac, and great vessels of chest, with pump oxygenator …. The following language was added to this CABG code, after the word “oxygenator:” age 1 year or older, for all non-coronary bypass procedures (eg, valve procedures) or for re-operation for coronary bypass more than 1 months after original operation.
• 64416, Injection, anesthetic agent; brachial plexus, continuous infusion by catheter (including catheter placement), 64446 (sciatic nerve continuous infusion) and 64448 (femoral nerve continuous infusion). The parenthetical “including daily management for anesthetic agent administration” was deleted from each of these codes because they were reclassified as having no days of follow-up, having had a 10-day global period previously.

For complete explanations of why these changes were necessary, please visit the Practice Management page on the ASA web site, http://www.asahq.org/news/asanews012609.htm, or consult with your ABC representative.

3. OIG Review of “Incident to” Services in 2009

In order to bill services that are “incident to” those provided directly by a physician in the office setting, the services must be integral to the physician’s service, performed by a person who is paid by the physician and who is under the direct supervision of the physician. The services must also be performed in a non-institutional setting. Direct supervision requires that the physician be on the premises in the “office suite” while the services are being performed. It is not appropriate to bill “incident to” services on a first patient visit as the physician must initiate a course of treatment during which the incident to services are performed.

It is also important to keep in mind that the physician must be actively involved in the patient’s treatment course and thus the physician’s involvement in subsequent visits should be documented. For those pain management physicians utilizing the “incident to” billing rules, it is important to establish careful documentation practices to support fulfillment of the requirements. Depending on the circumstances (e.g., type of allied health provider), other billing options may be available if the practice is unable to meet the “incident to” requirements. For example, if a nurse practitioner (but not an RN without advanced certification) is performing the service, this may include the submission of a claim under the provider number of the nurse practitioner.

According to the Office of Inspector General 2009 Work Plan, “incident to” services continue to be an area of scrutiny. The OIG is currently reviewing this billing area and expects to issue a report of its findings later in 2009. Many pain management practices bill services under the Medicare “incident to” rules and thus should ensure that they fully understand the requirements for billing such services.

4. Review of Medicare Payments for Interventional Pain Management Procedures (Facet Joints)

As part of the OIG 2008 Work Plan, the OIG reviewed Medicare payments for interventional pain management procedures for “medical necessity.” The OIG noted that interventional pain management was a growing specialty and that Medicare paid almost $2 billion for interventional procedures in 2005. The review was to focus on the appropriateness of payments for the procedures. In September of 2008, the OIG issued a report on “Medicare Payments for Facet Joint Injection Services” stating that they found that 63% of facet joint injection services allowed by Medicare in 2006 did not meet Medicare program requirements, resulting in $96 million in improper payments. Based on the review, the OIG recommended that CMS should “clarify billing instructions for bilateral services,” and CMS agreed.

This report highlights the importance of compliance in the pain medicine arena as pain management procedures may continue to be a focus of potential scrutiny in 2009. Given the report findings, pain management physicians may also experience Medicare auditing activity with regard to facet joint injections and/or other pain management procedures. You can obtain a copy of the OIG report by visiting www.oig.hhs.gov/oei/reports/oei-05-07-00200.pdf.

5. Using Ultrasound in Pain Medicine

Yet another pain medicine topic that appeared in the OIG Work Plan for 2009 was the use of ultrasound guidance for peripheral nerve blocks. The OIG’s concern with the potential for overutilization of ultrasound also appeared in the 2008 Work Plan. Accordingly, review of services and billing patterns in high-utilization areas, with a focus on service profiles, provider profiles and patient profiles will continue.

This means that anesthesiologists and other pain physicians should pay close attention to how they document each ultrasound service that they perform. The record should show both the medical necessity for and the quality of the service. Ultrasound guidance for needle placement, CPT™ code 76942 and ultrasound guidance for vascular access (add-on code 76937) both require permanently recorded images. Documentation should include any clinically indicated measurements, a description of the localization process and a written report. The completeness of the documentation will be key to the outcome of any OIG audit.

Since Medicare pays physicians more when they perform ultrasound services in their private offices, where they incur the equipment and personnel costs, than it does in the hospital or surgery setting, the OIG will also be watching for the correct use of modifier -26 to indicate that the physician provided the professional service only. The technical component will be billed by the facility.

6. The “RAC Attack”

Under Medicare’s Recovery Audit Contractor (RAC) program, significant auditing of Medicare providers will begin in 2009 and continue indefinitely. CMS pays the RAC vendors on a contingency basis for identifying Medicare overpayments (and underpayments!) through various auditing and review processes. Although hospitals, nursing homes, home health agencies and DME suppliers are more inviting targets, physician practices, including anesthesia and pain management groups, are subject to the bounty-hunting RAC program and should be prepared for RAC scrutiny.

Although there had been a temporary delay in the RAC activity due to vendor protests regarding the vendor selection process, these protests were resolved as of February 6, 2009. CMS will now continue with the implementation of its national RAC program. You can determine when the RAC vendor for your jurisdiction will begin auditing in your state by visiting the Download section of www.cms.hhs.gov/RAC. If selected for RAC auditing, it is imperative that you comply with all timeframes for responding to record requests and timely appeal any denied claims. Failure to do so will result in the inability to appeal any denials. Given the expected auditing activity, we encourage anesthesia and pain management physicians to continue to work on enhancement of documentation practices.

7. Are Mandated Compliance Programs A New Trend? -New York Medicaid Inspector General Mandates Compliance Programs

Medicare recommends the use of compliance programs, but does not require that medical practices or providers have program in place. On January 14, 2009, New York Office of Medicaid Inspector General issued proposed regulations mandating the establishment and maintenance of compliance programs for many Medicaid participating providers. The regulations include physician practices for which the medical assistance program is or should be reasonably expected by a provider to be a substantial portion of their business operations.

Substantial portion of business operations includes collections of $500,000 for a consecutive 12-month period as well as providers who claim or are expected to claim at least $500,000 in a consecutive 12-month period from the New York medical assistance program. It is not clear as to meaning of “claim”; however, an inquiry has been submitted to the regulators requesting clarification on this issue.

While this particular regulation only applies to New York providers, ABC will continue to monitor regulatory activities in other states to determine whether the mandating of compliance programs will be a trend with regard to Medicaid programs. This new proposed regulation along with the expected increase in Medicare auditing for 2009, continues to highlight the importance of physician groups maintaining active compliance programs.

8. The “Red Flag” Rules

May 1, 2009 marks the enforcement date for what are commonly referred to as the “Red Flag Rules”. These rules require financial institutions and “creditors” – which the Federal Trade Commission decided includes health care providers, among them physicians -- to develop and implement identity theft prevention programs that provide for identification, detection, and response to patterns, practices or specific activities (known as red flags) that could indicate identity theft. Although enforcement was initially slated for November of 2008, the FTC suspended enforcement until May 1, 2009 to give creditors additional time to develop and implement their identity theft programs.

Many health care providers were unpleasantly surprised to learn that they could be subject to the Red Flag Rules. The FTC regulation defines a creditor as an entity that regularly extends, renews, continues credit or arranges for the extension of credit. It appears that the FTC takes the position that health care providers are subject to the Rules if they extend credit to a consumer/patient by establishing an account that permits multiple payments (e.g., a payment plan).

ABC is in the process of evaluating the Rules as they apply to ABC clients and will provide future updates as to the protocols and policies that ABC will be implementing to assist groups in complying with the regulations. You can learn more about the Rules by visiting the Federal Trade Commissions website at www.ftc.gov.

9. PQRI Changes

The bonus available to physicians who successfully report performance measures under Medicare’s Physician Quality Reporting Initiative (PQRI) in 2009 will be eligible for a 2 percent bonus, payable in mid-2010. This is an increase from the 1.5 percent bonus paid for the first cycle of reporting under the PQRI.

There have been important changes to the two measures available to anesthesiologists. Measure #30, Timing of Prophylactic Antibiotic --Administering Physician, may now be reported on a claim for any one of some 200 anesthesia codes (00100, 00102 …) and not simply in every instance where there is an order for antibiotics. Measure #76, Prevention of Catheter-Related Bloodstream Infections (CRBSI) – Central Venous Catheter Insertion Protocol, may now be reported with CPT™ code 93503, insertion of a Swan Ganz catheter.

In order to qualify for the bonus, anesthesiologists are not subject to the standard minimum of three different measures; one will suffice. If you choose to report both measures, though, make sure that you add the PQRI performance codes to at least 80% of your eligible cases, i.e., those involving one of the underlying anesthesia or line insertion codes. Not meeting the 80% threshold for each measure that you have made applicable to your practice will cost you the bonus.

Pain specialists do not have any PQRI measures specifically applicable to their services. If they also perform surgical anesthesia, they may earn the bonus by reporting one or both anesthesia measures. Physicians who limit their practices to pain medicine exclusively may choose three of the various preventive services that may be reported together with an office visit, e.g., tobacco use counseling, advance care planning. ABC clients will receive further information and assistance from their account representatives. The American Society of Anesthesiologists is also making information available as is CMS (www.cms.hhs.gov/pqri.).

10. Health system reform in 2009

A majority of anesthesiologists (and consultants) believe that the Obama Administration has both the determination and the ability to obtain passage of federal legislation containing significant health system reforms. As we write this, Congress has just reached a deal on a $789 billion stimulus package. The final package does not provide as much money for health care subsidies for the uninsured as the Administration had sought, but it does contain $6.5 billion for medical research as well as $87 billion in federal aid to help states pay for Medicaid, according to the New York Times.

On February 4, 2009, President Obama signed legislation extending the popular State Children’s Health Insurance Program (SCHIP), which would otherwise have expired next month. SCHIP will permit the states to insure as many as 4 million low-income children who are ineligible for Medicaid.

Together, the SCHIP legislation and the American Recovery and Reinvestment Act of 2009 should reduce some uncompensated care costs for anesthesiologists in certain locations. Federal investment in Health Information Technology is also expected to stimulate the development of anesthesia information management systems.

Your feedback is always important to us. We invite you to send us questions and concerns; we will try to address those of general interest in future Alerts.