Its All In The Codes

Why We Do What We DoDavid Voran, MDKC Digital Drive Reimbursement to Value in TelehealthApril 13, 2017

Whenever I am asked to speak about technology and medicine the scene above comes to mind. The rocks in the stream make their way down very slowly pushed hither and thither by the rushing water.I think of traditional medicine as the rocks slowly rolling in whatever direction the fast moving water representing non-traditional medicine flows in response to gravity.

This is true for technology as it is in medicine. Traditional technologies have an inertia that doesnt constrain nimble, rapid flowing newer technology.

Telehealth is also represented by this picture. Reimbursement rules constrain the rocks of traditional rule-based telemedicine and telehealth while every day medical services are quietly being used to meet peoples needs in a direct-to-consumer framework that is limited only by imagination and market forces.2

Big DisconnectEach one of us carries around more technology in our hands than most Telemedicine organizations have .

The big disconnect is that each one of us today carries in our pockets more sophistication and technology on which almost all of the current traditional telemedicine programs were created. Yet, weve not been able to truly leverage this. I keep asking myself, why arent 90% of all office visits done on the phones?3

Each one of our patients have access to a wide array of diagnostic tools online some better than what we clinicians use in our offices

Many people would immediately argue that phone cannot see or feel yet what is remarkable is there are literally hundreds of inexpensive devices that far surpase a clinicians ability to see or measure and in many respects outperform the typical devices found in most exam rooms. The overwhelming majority of these devices (many which are FDA certified) are available to consumers directly without prescriptions. They include otoscopes, stethoscopes, temperature gauges, EKGs and a host of other devices that measure one function or another.4

Some, such as Cellscopes OTO are so good I havent used a regular otoscope for several years now. This device enables me to use a totally non-threatening device that is familiar to every child and adult to very conspicuously see the ear drum and immediately share that with the patient, pointing out the presence or lack of pathology to their satisfaction. Ive found nothing engages a patient more than visual images of what they cannot normal see and makes treatment decisions a much easier.5

So Why Isnt This Mainstream Medicine?

So why is this type of care mainstream?6

We all do what we get paid to do

Sadly, we all fall back on doing what we get paid to do.7

And Thats In The Code

And right now getting paid, especially from 3rd party payers that cover all but a tiny fraction of our services is in the code. There is a code for just about every thing we do. If theres no code . They wont pay.8

Brief HistoryPeriodBilling SystemPre 1960Paper invoices designed by each physician, group or hospitalEach had their own internal coding systemSubmitted to whomever was the payerMid 1960sAMA developed a standardized system, Common Procedural Terminology CPT, for use by members1970-1980Government and many 3rd party payers adopted AMAs CPT and standardized on HCPCS codes for those services not rendered by physicians1996Health Insurance Portability and Accountability Act mandated use of CPT, HCPCS, ICD-9-CM and other leading code sets

For several decades, medical billing was done almost entirely on paper. However, with the advent ofmedical practice management software, also known as health information systems, it has become possible to efficiently manage large amounts of claims. Many softwarecompanies have arisen to provide medical billing software to this particularly lucrative segment of the market. Several companies also offer full portal solutions through their own web-interfaces, which negates the cost of individually licensed software packages. Due to the rapidly changing requirements by U.S. health insurance companies, several aspects of medical billing and medical office management have created the necessity for specialized training. Medical office personnel may obtain certification through various institutions who may provide a variety of specialized education and in some cases award a certification credential to reflect professional status. The Certified Medical Reimbursement Specialist (CMRS) accreditation by theAmerican Medical Billing Associationis one of the most recognized of specialized certification for medical billing professionals.

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Why did AMA develop CPT?AMA developed and published the 1st Current Procedural Terminology (CPT) in 1966Designed to encourage use of standard terms and descriptors to document procedures in the medical recordHelped communicate accurate information to agencies concerned with insurance claimsProvided basis for a computer oriented system to evaluate operative proceduresContribute basic information for actuarial and statistical purposesCPT (Current Procedural Terminology)

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The American Medical Association (AMA) first developed and published CPT in 1966. The first edition helped encourage the use of standard terms and descriptors to document procedures in the medical record; helped communicate accurate information on procedures and services to agencies concerned with insurance claims; provided the basis for a computer oriented system to evaluate operative procedures; and contributed basic information for actuarial and statistical purposes.The first edition of CPT contained primarily surgical procedures, with limited sections on medicine, radiology, and laboratory procedures. The second edition was published in 1970 and presented an expanded system of terms and codes to designate diagnostic and therapeutic procedures in surgery, medicine, and the specialties. At that time, a five-digit coding system was introduced, replacing the former four-digit classification. Another significant change was a listing of procedures relating to internal medicine.In the mid to late 1970s, the third and fourth editions of CPT were introduced. The fourth edition, published in 1977, represented significant updates in medical technology, and a system of periodic updating was introduced to keep pace with the rapidly changing medical environment. In 1983 CPT was adopted as part of the Centers for Medicare and Medicaid Services (CMS), formerly Health Care Financing Administration's (HCFA), Healthcare Common Procedure Coding System (HCPCS). With this adoption, CMS mandated the use of HCPCS to report services for Part B of the Medicare Program. In October 1986, CMS also required state Medicaid agencies to use HCPCS in the Medicaid Management Information System. In July 1987, as part of the Omnibus Budget Reconciliation Act, CMS mandated the use of CPT for reporting outpatient hospital surgical procedures.Today, in addition to use in federal programs (Medicare and Medicaid), CPT is used extensively throughout the United States as the preferred system of coding and describing health care services.

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HCPCSEstablished in 1978 as a way to standardize identification of medical services, supplies and equipmentConsists of 2 code setsLevel I: CPT owned and maintained by the AMALevel II: code set for medical services not included in Level I and maintained by CMS HCPCS WorkgroupDurable medical equipment, prosthetics, orthotics and suppliesMandated by Congress as part of the Health Insurance Portability and Accountability Act of 1996 (HIPAA)Healthcare Common Procedure Coding System

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The Healthcare Common Procedure Coding System (HCPCS) was established in 1978 as a way to standardize identification of medical services, supplies and equipment. It is composed to 2 code sets. The first level, or Common Procedural Terms, is owned, maintained and licensed by the AMA. The second level, is the code set developed and maintained by the government for all medical services that are not included in the the first level. As mentioned, it is maintained by the Centers for Medicare and Medicaid Services or CMS. Specifically its maintained by the HCPCS Workgroup.

As referenced earlier, this workgroup was essentially created by regulation to implement the HIPAA requirement for standardized coding systems in the Administration Simplification Act of 1996 or what is better known as the Health Insurance Portability and Accountability Act also known as the Kennedy Kassebaum Act, a joint bill sponsored by Democrat Senator Edward Kennedy and Republican Senator Nancy Kassebaum.11

Physician Fee Schedule

Periodically, often yearly, the master code set is published as the Physician Fee Schedule available on CMS web site. 12

This spreadsheet defines every procedure but more importantly lists the amount of work on a Relative Value Scale (RVU) that is required of the professional (aka, physician) and the facility (aka hospital) to deliver this amount of work. This spread sheet contains columns that define certain circumstances the code may be applied. More importantly this spreadsheet contains a current conversion factor (the dollar amount per RVU) that is to be reimbursed for a given code.

The 2017 version of this spreadsheet has 16458 codes.13

Here is a simplified version of the spreadsheet that I keep up-to-date with me for grins and to read when I really want to drill a hole in my head! Speaking of which lets take a look at Gode 61108, Drill skull for drainage. An work RVU has been established for this of 11.64 RVUs. The professional or physicians RVU is 10.28, the hospitals work is also 10.28. Malpractice costs are also listed in RVUs and for this procedure are quite high at 4.55. Combine these and you get 26.47 RVUs no matter what the location to put a hole in your head and drain your brains.

As of yet theres no currency called RVU but fortunately theres a conversion factor of $35.8887 per RVU. The result? $949.97 per hole no matter where it is performed!14

So now we get to discuss the subject of this meeting: Telehealth. The definition of telehealth by CMS is undergoing constant changes. You can begin the rat-hole journey here: https://www.cms.gov/Medicare/Medicare-General-Information/Telehealth/index.html15

Key Medicare TeleHealth PointsBalanced Budget Act of 1997 mandated Medicare coverage of telehealthFunded many telemedicine demonstration projectsCoverage not required until 1999Required a practitioner be with the patient during the eventTelehealth reimbursement shared with consulting (75%) and referring (25%) physicianBenefits Improvement and Protection Act of 2000 Further definitions (originating & distant sites)Extended coverage for demonstration and non-metropolitan statistical areasEliminated fee sharing requirement (originating = facility fee, distant = E&M)Expanded services to include direct care, consultations and psychiatryEliminated need for tele-presenterPermitted store-and-forwardSpecified types of providers eligible for telehealth reimbursementMedicare Improvements for Patients and Providers Act 2008Added hospital based or critical access hospital renal dialysis centers, skilled nursing and community health centers as qualifying origination sites

Medicare has been liberalizing and expanding its coverage of telemedicine.16

ToolsOriginating site payment analyzerList of covered codes

But there are significant restrictions depending on where the patient is. These can be discovered very quickly on line.17

2-way, real time, interactivecommunication between patient and physicianAudio & VideoNot recognized by Federal MedicaidAsynchronous store and forward not telemedicineStates can choose which codes to reimburseTelehealth includes phones, faxes even though not meeting Medicaids telemedicine definitionStates have broad license to determine what services are reimbursedAnd can limit who or where those services are covered

But is leaving most of the decision making up to the states for Medicaid18

So how do states compare?

Fortunately the American Telemedicine Association, or more accurately Latoya Thomas and Gary Capistrant, have been surveying and updating their State Telemedicine Gaps Analysis volumes that clearly compare how states are handling Physician Practice Standards and Licensure as well as Coverage and Reimbursement.

The following slides are images extracted from both of these volumes and cover:Telehealth ParityMedicaid CoverageMedicaid Patient SettingsMedicaid covered technologies20

Telehealth Parity

Full parity is classified as comparable coverage for telemedicine-provided services to that of in-person services. Thirty-one states and the District of Columbia have enacted full parity laws. Only Alaska and Arizona have enacted partial parity laws that require coverage, but limits coverage and reimbursement to a predefined list of health care services. Since our initial report, some parity laws have included restrictions on patient settings. For this reports purpose, we added this component to our methodology, and continue to measure other components of state policies that enable or impede parity for telemedicine-provided services under private insurance health plans.

States with the highest grades for private insurance telemedicine parity provide state-wide coverage, and have no provider, technology, or patient setting restrictions (Figure 3). This year Rhode Island joins other high ranking states with the passage of its 2016 parity law. Among other states with parity laws, Alaska and Vermont scored about average (C). Alaskas law only covers mental health services, while Vermont lawmakers have placed patient setting restrictions on those services eligible for coverage parity. Arizona removed its rural only restrictions and now offers telehealth parity statewide, yet still continues to limit coverage to interactive audio-video only modalities and specific types of services and conditions that are covered via telemedicine. Despite enacting a parity law in March 2015, Arkansas maintains a failing grade because it places arbitrary limits on patient location, eligible provider type, and requires an in-person visit to establish a provider-patient relationship. Forty-four percent of the country ranks the lowest with failing (F) scores, a drop from the initial report.

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Medicaid Coverage

Each states Medicaid plan was assessed based on service limits and patient setting restrictions. Provider eligibility and the type of technology allowed were also examined to determine the states capacity to fully utilize telemedicine to overcome barriers to care. For this reports purpose, we measured components of state policies that enable or impede parity for telemedicine-provided services under Medicaid plans. Eleven states have the highest grades for Medicaid coverage of telemedicine-provided services. New Hampshire ranks the lowest with a failing (F) score because it still applies geography limits in addition to restrictions on service coverage, provider eligibility, and patient setting. Connecticut, Florida, Hawaii, Idaho, Utah, and West Virginia have all made improvements to expand coverage of telemedicine for their Medicaid populations. Rhode Island joins the ranks with telemedicine Medicaid coverage with reimbursement for some initial and follow-up telemedicine consultations.

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In telemedicine policy, the place where the patient is located at the time of service is often referred to as the originating site (in contrast, to the site where the provider is located and often referred to as the distant site). The location of the patient is a contentious component of telemedicine coverage. A traditional approach to telemedicine coverage is to require that the patient be served from a specific type of health facility, such as a hospital or physician's office. With advances in decentralized computing power, such as cloud processing, and mobile telecommunications, such as 5G wireless, the current approach is to cover health services to patients wherever they are e.g. home, place of work, school, etc. For this report, we measured components of state Medicaid policies that, for conditions of coverage and payment, broaden or restrict the location of the patient when telemedicine is used. The following sites are observed as qualified patient locations: hospitals doctors office other providers office dentist office home federally qualified health center (FQHC) critical access hospital (CAH) rural health center (RHC) community mental health center (CMHC) sole community hospital school/school-based health center (SBHC) assisted living facility (ALF) skilled nursing facility (SNF) stroke center rehabilitation/therapeutic health setting ambulatory surgical center residential treatment center health departments renal dialysis centers habilitation centers pharmacy. States received one (1) point for each patient setting authorized as an eligible originating site. Those states that did not specify an originating site were given the maximum score possible (21). Twenty-eight states do not specify a patient setting or patient location as a condition of payment for telemedicine (Figure 6).

Aside from this, 40 states allow the home as an originating/patient site, while 23 states and D.C. recognize schools and/or SBHCs as an originating site (Figures 7-8).

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Telemedicine includes the use of numerous technologies to exchange medical information from one site to another via electronic communications. The technologies closely associated with services enabled by telemedicine include videoconferencing, the transmission of still images (also known as store-and-forward), remote patient monitoring (RPM) of vital signs, and telephone calls. For this report, we measured components of state Medicaid policies that allow or prohibit the coverage and/or reimbursement of telemedicine when using these technologies. Twelve states score above average on our scale with Alaska and Arizona taking the highest ranking (Figure 9). Alaska covers telemedicine when providers use interactive audio-video, store-and-forward, remote patient monitoring, and audio conferencing for some telemedicine encounters. Arizona allows numerous modalities including phone, video, or store-and-forward to enable its remote patient monitoring service. Alaska, Arizona, Hawaii, Minnesota, Mississippi, Nebraska, Texas, and Washington all cover telemedicine when using synchronous technology as well as store-and-forward and remote patient monitoring in some capacity. A little less than 50 percent of the states rank the lowest with failing (F) scores either because they only cover synchronous only or provide no coverage for telemedicine at all. Further, Idaho, Missouri, New York, North Carolina and South Carolina prohibit the use of cell phone video or video phone to facilitate a telemedicine encounter.

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We measured components of state policies that enable or impede parity for telemedicine-provided services under state-employee health plans. Most states self-insure their plans therefore traditional private insurer parity language does not automatically affect them. Oregon, an exception, amended its parity law to include self-insured state employee health plans. Twenty-six states provide some coverage for telemedicine under their state employee health plans with all of them extending coverage under their parity laws. North Dakotas parity law only covers state employee health plans. Roughly 50 percent of the country is ranked the lowest with failing scores due to partial or no coverage of telehealth.

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What About Kansas and Missouri?

The American Telemedicine Association does a bang up job of comparing states as to the Covereage offered 27

And how they regulate who can practice and under what circumstances.28

More non face-to-face Codesavailable

Medicare is recognizing the importance (and reality) of medical care provided outside a face-to-face meeting29

Has added these codes to the physician fee schedule30

Remember RVUs?

However, theres one glaring deficiency when it comes to reimbursing for the water that flows around the stones

The AMA and the HCPCS Working group havent assigned RVUs for many of the online, virtual services. The impact of this is that whether we like it or not almost all physician practices use RVUs as a measure of productivity. So even those organizations that want to and are able to provide telemedicine often cant find physicians who are willing to give up what they are doing now to do telemedicine because they dont accumulate RVUs and risk losing out on incentive payments based on RVUs.31

The rushing water around us bombards us in daily e-mails enticing physicians to sign up with their solutions that reach out directly to patients as well as describe innovating organizations use of telehealth services.33

I have been dabling with HealthTap to see whats happening in direct-to-consumer medicine. The entry point was very low. Learning curve is acceptable. Overall I wasnt really pleased with the overly commercial aspects of this and actually had deleted the app after using it for about a year.But then I saw this:34

This is where it really gets interesting.35

What do you think?