Article

2021 Changes to Evaluation and Management Codes and Conversion Factor

stethoscope and patient chart

CMS evaluates CPT codes and corresponding wRVU values annually with input from the AMA’s RVU Update Committee (RUC). In response to physician feedback regarding the burden of documentation requirements, CMS proposed an overhaul of Evaluation and Management (E&M) codes in 2019, including revising how codes are selected. Historically, office visit code selection and medical record chart documentation were conducted in accordance with the Evaluation and Management Guidelines published in 1995 and as well as a second set of Evaluation and Management Guidelines published in 1997.

Under the revised guidelines, physicians will chart and select codes based on either time spent with the patient or medical decision making. Other historical elements of care as required with the 95/97 E&M guidelines will still be conducted as and when deemed medically appropriate by the physician.

The changes are planned for implementation on January 1, 2021 and were formally announced with publication of the CY 2020 Medicare Physician Fee Schedule. CMS is accepting comments until October 5 as part of the annual CY 2021 Physician Rule, making a delayed implementation date possible due to COVID 19 and potential concerns raised by stakeholders.

These changes have significant implications for physician practices in multiple areas. It is recommended that health systems model the impact of these changes and identify strategies to mitigate the associated risks for 2021, even with potential further delay by CMS.

The intent of these modifications is to simplify documentation and billing for E&M codes, reflected by the increased time required to complete patient encounters due to the shift to value-based care models. This shift has placed a greater emphasis on care coordination, prevention, and population health, which while beneficial, are more time consuming to conduct and document within EMRs. At the same time, coding and documentation for medical proceduralists and specialists is expected to decrease as they must utilize medical decision making versus the time approach of code and documentation methodology.

Key changes to E&M codes include:

  • Reduced new patient visit codes from five to four; 99201 is eliminated
  • Modified assigned times for most E&M visit codes
  • Adjusted wRVU values with an overall increase in wRVUs for E&M visit codes
  • Added code 99XXX to recognize instances in which the patient visit is extended. The code would be added to E&M codes 99205 and 99215 for every additional 15 minutes required.
  • Added code GPC1X to be assigned in cases of complex and severe conditions

New and established E&M code chart

Revisions and adjustments to E&M codes are not the only change. To maintain budget neutrality, CMS has reduced the RVU conversion rate by 10%, from $36.09 to $32.26 which in turn will cause a reduction in PFS reimbursement for all professional services by practitioners reimbursed under the PFS. As the following table shows, many E&M codes will be reimbursed at a lower rate than in 2020, despite higher wRVU values, intensifying the financial impact of these changes.

E&M Code/Patient/Level chart

E&M Changes: Financial Impact

These changes benefit specialties that provide most services in the office through patient visits. Surgical and procedural specialists will see a reduction in wRVU value assigned to some procedural CPT codes. Reductions in wRVU value and conversion rate will result in decreased revenue for same-store volumes for some specialties.

E&M code changes financial impact chart E&M code changes financial impact chart

E&M Changes: Compensation Impact

These changes may impact compensation for same-store productivity depending on the compensation model. As the percentage of compensation tied to productivity increases, the greater the impact of these changes on compensation.

The result will have a material increase on productivity for office-based specialties without commensurate increases in output. Office-based practices will most likely see increases in incentive payments while procedural or surgical practices may see reductions in the absence of adjustments to the compensation methodology for 2021.

Health Systems Strategies

Numbered health system strategies

For assistance or more information: contact us