CMS Proposed E&M Changes Would Eliminate 1995 and 1997 Guidelines

Major E&M changes on the horizon.

Probably the biggest change in healthcare in two decades is the Centers for Medicare & Medicaid Services (CMS) proposal to redefine the documentation requirements for evaluation and management (E&M) coding in 2019. The agency is proposing to forego the 1995 and 1997 guidelines for what is being reported as a “simpler model” that will eliminate the need to re-document prior visit redundant information and focus on medical decision-making. 

But wait: there is more to it. This will require significant re-education of physicians and mid-level providers on how to document. Our client base – some of whom I believe will have the “it’s about time” reaction – will be surprised at the proposal, but then will realize the impact to reimbursement this will have, and they may go running to their specialty societies and associations to stop the madness. 

Why? Because CMS is proposing to blend new patient E&M services into one specific relative value unit (RVU). The documentation is based on the ability of any provider to get into their electronic medical records (EMRs) to find additional information other than what was noted. Malpractice may become more of a problem with less documentation given that physicians will still need to document at pretty much the same level of detail as they do now to meet other clinical, legal and operational needs. CMS has added many new modifiers to indicate specific specialties and even changed prolonged care. Podiatrists, however, will have a bonanza if this new proposal goes through. It is going to cost the billers a lot more time to enter all the modifiers.

CMS Administrator Seema Verma stated in an open “dear doctor letter” to physicians (stakeholders) in the Medicare program that “today’s proposals deliver on the pledge to put patients over paperwork by enabling doctors to spend more time with their patients.”

“Physicians tell us they continue to struggle with excessive regulatory requirements and unnecessary paperwork that steal time from patient care,” Verma continued. “This administration has listened and is taking action. The proposed changes to the Physician Fee Schedule and Quality Payment Program address those problems head-on by streamlining documentation requirements to focus on patient care and by modernizing payment policies so seniors and others covered by Medicare can take advantage of the latest technologies to get the quality care they need.”

In reviewing these changes, CMS asserted that the proposed 2019 Physician Fee Schedule would help to “free” EMRs in the following ways:

  • By allowing practitioners to choose to document office/outpatient E&M visits using medical decision-making or time instead of applying the current 1995 or 1997 E&M documentation guidelines, or, alternatively, practitioners could continue using the current framework;
  • By expanding current options in allowing practitioners to use time as the governing factor in selecting visit levels and documenting the E&M visit, regardless of whether counseling or care coordination dominates the visit;
  • By expanding current options regarding the documentation of the history and exam, allowing practitioners to focus their documentation on what has changed since the last visit or on pertinent items that have not changed, rather than re-documenting information, provided that they review and update the previous information; and
  • By allowing practitioners to simply review and verify certain information in the medical record that is entered by ancillary staff or the beneficiary, rather than re-entering it.

CMS is estimating that if these proposals were finalized, clinicians would see a significant increase in productivity. In fact, the agency’s position is that this proposal will eliminate unnecessary paperwork requirements and would save individual clinicians an estimated 51 hours per year if 40 percent of their patients are in Medicare. But what is missing in all this is the reality of the reimbursement concerns, especially for the specialty physicians who are taking care of sicker patients who need more time, effort, and higher levels of care managing their complex issues.

This proposal will in effect penalize those physicians in specialties such as oncology, cardiology, pulmonary, rheumotology, and nephrology, to name a few. As an auditor myself, I understand that CMS wants to try and make things simpler for themselves and their auditors, but not really the physicians, in my opinion. This does nothing to cut spending under the Medicare program, but it more redistributes money among physicians – and it looks like the primary care physicians (PCPs) are in the win column. Where are the specialists considered in the proposed model?

I also believe that if this proposal or any form of it goes through, it sets up practices to likely see fewer Medicare patients and more commercial patients who do not follow the Medicare model. I also see this giving a big boost to concierge medicine. So patients with heart disease will have to wait, since the patient whose insurance will pay for the same care at a higher price, or the patient who can afford the cash price, will be given priority in the schedule. This is how Medicaid patients are treated now. Unless it is an emergency, they are at the back of the line, and some physicians have opted out of the program entirely. 

CMS is trying to sell this plan as “restoring the doctor-patient relationship,” but when you look at the reality of the proposed changes, the American Hospital Association stated it best, suggesting that “providing substantially less ability to distinguish evaluation and management codes for different levels of resource use and intensity of services means that physicians who provide care for a disproportionate number of high-acuity patients would consistently, and unfairly, receive underpayment.” I could not agree more.

Luckily, American Medical Association (AMA) President Barbara L. McAneny, M.D. put out the following position: “The AMA is evaluating how this proposal will affect patients, especially those with complex conditions, and we will be carefully evaluating the impact across various types of patients and specialty practices.”

But for some doctors, that new system is just too simple: with one payment level, no matter the complexity of a patient visit, the American College of Cardiology and the Community Oncology Alliance said physicians could face drastic cuts in payment, especially while overseeing life-threatening, complex cases.

Under the proposal, oncologists, for example, would see a reduction for the critical evaluation and management of more complex cancer cases from $172 to $135 (a 22 percent cut) for a new patient and from $148 to $93 (a 37 percent cut) for an existing patient, the group said. There is a similar reimbursement situation for cardiologists as well, for a congestive heart failure patient or peripheral vascular disease patient. This issue also reaches beyond Medicare, as private plans tend to follow the CMS lead (think about the elimination of most consult coding for many payors), so the reimbursements would be even lower.

The table below is a look at what the physicians can expect for reimbursement for new and established patients under this proposed model. 



Even though I appreciate their effort, as CMS seems to be trying to streamline the burdensome task of E&M documentation, it is not taking all providers’ work and patient types into consideration, or what this could do to the entire Medicare patient population.

Instead of putting forth a proposal that has more holes in it than positives, and making a push for it to become effective only six months after it was purposed, this should be one of many potential proposals, with time for open discussion (not the 60 days they are giving associations and physicians to weigh in), plus a request for proposals from industry experts, auditors, and educators. Then a thoughtful decision could be made. This issue was addressed earlier in the year, and it was determined that a change this drastic would take at least two to three years to perfect and implement.

Now, in saying all of this, there are proponents of the proposal who are hoping to lessen their documentation burden, regardless of the reimbursement. The one positive I do see is the focus on medical decision-making in the record, as we at ICD10monitor have been consistently educating on lately. Regardless of your position on this proposal, we encourage you, as physicians, to have a voice and give your opinions in writing to CMS and to your specialty society and associations. They are your lobbying advocates, and you need to act before Sept. 10, 2018, or the decision will be made for you.

Please go online to this link to hear the entire proposal by CMS and find out how to register your thoughts on the matter:


Program Note:

Listen to Terry Fletcher report on topic today on Talk Ten Tuesday, 10 a.m. EDT.



Terry Fletcher, BS, CPC, CCC, CEMC, CCS, CCS-P, CMC, CMSCS, CMCS, ACS-CA, SCP-CA, QMGC, QMCRC, is a healthcare coding consultant, educator, and auditor with more than 30 years of experience. Terry is a past member of the national advisory board for AAPC, past chair of the AAPCCA, and an AAPC national and regional conference educator. Terry is the author of several coding and reimbursement publications, as well as a practice auditor for multiple specialty practices around the country. Her coding and reimbursement specialties include cardiology, peripheral cardiology, gastroenterology, E&M auditing, orthopedics, general surgery, neurology, interventional radiology, and telehealth/telemedicine. Terry is a member of the ICD10monitor editorial board and a popular panelist on Talk Ten Tuesdays.

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