Reimbursement Issues for 2007 and Coding QNA

Payment Levels for Medicare and Beneficiaries

Concerns have recently been raised on various audiology e-mail listserves regarding the difference between proposed payment levels for Medicare and beneficiaries under two different programs: the Outpatient Prospective Payment System (OPPS) (www.cms.hhs.gov/HospitalOutpatientPPS/) and the Medicare physician fee schedule (www.cms.hhs.gov/PhysicianFeeSched/). In November, 2006, an announcement was released by The Centers for Medicare and Medicaid Services (CMS) proclaiming an increase in reimbursement for the OPPS-related services including auditory processing disorder evaluations,, tinnitus assessment, evoked potential testing, and balance evaluations (www.asha.org/about/legislation-advocacy/2006/audproincrOPPS.htm). In contrast, the projected levels of reimbursement for audiology services under the Medicare physician fee schedule show a decrease of approximately 5% (www.audiologyonline.com/news/news_detail.asp?news_id=2372). Fortunately, Congress stepped in to freeze the dollar conversion multiplier at last year's level, essentially negating the decrease. This discrepancy in future reimbursements has many professionals wondering why one payment system is going up while the other is set to go down. This article will explain the differences between the OPPS and Medicare physician fee schedule programs and why project and reimbursement levels are unequal.

Fee Schedules

The OPPS and Medicare physician fee schedule are two different pools of money, with different rules governing each. The fee schedule is required by law to use the Resource Based Relative Value Scale, which includes the basic elements of the professional component (work), technical component (practice expense), and professional liability insurance (malpractice). For current procedural terminology (CPT) codes that include both work and practice expense, indirect costs are added in as an additional calculation to boost the final relative value unit (RVU). Indirect costs can sometimes be as high as 60% of the total RVU for work + practice expense + malpractice and are intended to cover such things as rent, administrative support personnel, utilities, and other expenses not specifically associated with direct service delivery of a particular procedure.

OPPS Fee Schedule

OPPS shares many similarities with the Diagnosis-Related Groups (DRG), which is a payment system of which hospitals have been associated for many years. It is a categorical system that employs different APC (Ambulatory Payment Classification) reimbursement levels, depending on the complexity of the procedure. Under the OPPS system, the audiologist in the hospital outpatient setting would fill out an encounter form, similar to private practice, marking what was done by corresponding CPT code. When the encounter form arrives at the billing office, the CPT codes are converted and assigned respective APC codes. An APC code is simply a categorical listing of reimbursement that does not take into account the elements of the physician fee schedule. For example, CPT code 92543 (calorics) is assigned to APC 0660 with a flat reimbursement rate of $92.25. The APC system does not recognize unit billing, so the reimbursement would be $92.25 for all calorics tested. CPT code 92546 (sinusoidal rotational test) is also assigned to APC 0660 with the same reimbursement. The same is true for posturography. CPT code 92557 (comprehensive audiometry) is assigned to APC 0365 with a flat reimbursement of $76.74. All of the CPT codes from 92562 through 92593 (with the exception of 92572, tone decay) are assigned to APC 0364 with a flat reimbursement for each code of $28.54. Code 92572 (SSW test) is assigned to APC 0366 with a reimbursement of $111.87. (Note that the rates above are based on proposed rates for 2007 see www.cms.gov/HospitalOutpatientPPS/Downloads/CMS1506P.pdf for more details) As documented, each APC is a categorical level of reimbursement that may encompass numerous CPT codes. Many audiologists who do not work in a hospital outpatient setting may have little reason to have much familiarity with the OPPS and its related APCs, although a general awareness may be beneficial for all clinicians in the field.

Medicare Physician Fee Schedule

Three things happened this fall to impact the Medicare Physician Fee Schedule reimbursement for 2007. The first was a programmed 5% overall reduction in payment to all health care providers, physicians included. The programmed reduction is dictated by federal law, although Congress wrote a new law to negate the reduction for this year. This action essentially pushes the reimbursement reduction back a year and has the potential to increase future reductions by virtue of the requirement of budget neutrality. The following is a summary of how this process might work in a typical year when Congress does not intervene to negate reimbursement reduction: Consider the economy grew at a rate of 3% last year. Consequently, by law, the Medicare pool of money can grow by 3%. Let's also assume that Medicare paid out 8% more than was budgeted because of demand for services, new CPT codes, and increased reporting of CPT codes. In short, the economy grew by 3%, but Medicare was over budget by 8%; therefore, by law, the following year's budget must make up for the previous year's overspending by reducing payments by 5%.

The second impact was the elimination of the non-physician work pool. This was a temporary pool of money and calculation formula that was established in 1999 because Medicare was unsure of how to value CPT codes that did not have the professional component (work) as part of the reimbursement formula. (Most audiology codes and almost all of the new codes for speech-language pathology fall into this category.) Also included were procedures for hematology/oncology, radiation oncology, radiology, pathology, and cardiology lab procedures. Compared to the others, especially radiology, expenditures for audiology services were no more than budget dust. The formula that was developed for this pool of non-physician CPT codes artificially inflated reimbursement values of the practice expense by first using the all physician average-per minute-of-practice expense. This almost doubled what we would have been paid on a per-minute basis: $0.95 per minute (all physician average for practice expense) versus $0.52 per minute (audiology salary per minute for practice expense). The total RVU calculation also included some indirect costs. Traditionally, indirect costs are not included for codes with have practice expense and malpractice RVUs only. Lastly, the origin of the formula came from historical charges prior to 1999 with some mathematical alterations to account for the different services. This pool of money was scheduled to be eliminated last year, but lobbying by ASHA and AAA together held it off for one more year. The pool is, however, scheduled to be eliminated effective January 2007. We had been in continuous discussion with CMS about what to do to minimize the impact of losing the non-physician work pool and the possible conversion of our codes to the standard practice expense formula.

This leads us to the third event influencing Medicare reimbursement for 2007. CMS is changing from a "top-down" to a "bottom-up" approach in calculating practice expenses. In the top-down calculation, the total RVU for the code was established through a refinement methodology for both the work RVU and the professional liability insurance (PLI) RVU, which were scaled values compared to all other CPT codes. The remaining portion was designated for the practice expense. The problem with this perspective was that it tended to over-value or under-value practice expense and did not capture an accurate picture of the true practice expense costs (ancillary support personnel, capital equipment depreciation, and disposable supplies).

The new method of calculating practice expense, the bottom-up approach, attempts to be more accurate in calculating the specific costs of practice expense. It begins with ancillary support personnel, such as nursing and technical support professionals (into which category audiologists and speech-language pathologists fall at the present time), and uses The U.S. Bureau of Labor Statistics per-minute salary values multiplied by the number of minutes the ancillary staff participates in the procedure to calculate personnel costs. At present, audiologists are worth $0.52 per minute based on median salary values surveyed by The Bureau of Labor Statistics. Capital equipment (items costing more then $500) are calculated for their depreciation rate times the number of minutes the equipment is used for each procedure. The cost of disposable supplies (e.g., alcohol prep pads, gauze sponges, audiogram forms, etc.) is also included into the calculation. This new methodology eliminates the artificial inflation for reimbursement that we enjoyed from the non-physician work pool and tends to calculate actual costs more accurately. Obviously, our concern is that most of our audiology and speech pathology codes, which are practice expense only, will experience a significant reduction in Medicare reimbursement.

The Need to Move Toward Work RVUs

It is out of this concern and anticipation of future trends that we have been lobbying the CMS for the past three years to recognize audiologists for work RVUs and move the procedures in this discipline out of practice expense. At the present time of this manuscript, we have just received a letter from CMS stating that they are willing to entertain the idea if the American Medical Association (AMA) CPT panels recommend such a change. We will be on the agenda for the next AMA Relative Value Update Committee meeting to discuss this transition reimbursement formula and to seek their guidance on how it can be accomplished in a most expeditious manner.

The primary goal of this exercise is to stabilize our reimbursement and remove our codes from the various influences of practice expense. In particular, our efforts will be focused on correcting the decreasing reimbursement that we anticipate for 2007, as well as preventing the more dramatic decreases in reimbursement that have been forecast over the next three years. By virtue of the four-year phase of this new practice expense formula, CMS has calculated that audiology reimbursement has a potential to decrease by a minimum of 20% and as much as 40% by January 2010. This is one of the primary reasons why we are working to move audiology and speech-pathology procedures out of practice expense and into work RVUs. The issues associated with converting our codes from practice expense to recognition of professional work are numerous and, depending on the AMA's recommendation for doing so, may necessitate the recruitment for many audiologists across the country to participate in surveys to develop recommendations for work RVUs. Although it is far from being a "done deal", I am encouraged that the door is open to prevent long-term devastating effects on audiological reimbursement.

Goals for Audiology

Lest there be misunderstanding, it is important to emphasize that this effort has nothing to do with audiological autonomy, practice independence, or direct access. The first and primary goal is to stabilize our reimbursement so that, as events continue to unfold in the world of Medicare, we will not be uniquely and financially disadvantaged. The second goal is to be able to recognize through the reimbursement formula that we are referring to professionals and not technicians. Of the non-physician healthcare providers who are potentially eligible to move from practice expense to work RVUs, only audiology and speech-language pathology remain. Most recently, psychology and medical nutrition have made the transition to work RVUs. Physical therapy and occupational therapy have been authorized work RVUs for many years. All of the limited-license physician practitioners (optometrists, podiatrists, chiropractors, etc.) have been authorized reimbursement using work RVUs practically from the beginning. There will be much to do and much more information to come, so stay tuned.

Coding Questions and Answers

These are a series of questions that I have received as they relate to coding for audiology. They are presented with my answers as more of a general discussion on coding as opposed to a comprehensive resource. The reader is encouraged to consult the 2006 CPT Manual and HCPCS manual (both available at www.ama-assn.org) for more information.

Question:
How should I bill for the Epley maneuver?

Answer:
Many audiologists use the physical therapy code 97112 (Neuromuscular Re-education Of movement, balance, coordination, kinesthetic sense, posture, and/or proprioception for sitting and/or standing activities). There is not a code specific to the Epley, but this is something we are working on.

Question:
How should I bill insurance companies for hearing aids?

Answer:
There is not a standard procedure on how to bill for hearing aids. I would advise you to contact each insurance company that you will be using and find out what codes are authorized in their system. You may then want to follow-up with a phone call for any clarification you might need.

Question:
How should do I code for real-ear measurements?

Answer:
There are two CPT codes, 92954 and 92595. These are for the electroacoustic evaluation of a hearing aid, monaural and binaural, respectively. The code is not specific to measurements in the 2cc coupler or probe tube measurements.

Question:
Do most insurance companies cover basic hearing evaluations for their members?

Answer:
Almost all insurance companies offer coverage for diagnostic hearing evaluations. Even in cases where some carriers do not recognize audiologists as carriers, they will still offer the coverage, under specific conditions. That is, the evaluation must be deemed, "medically necessary" with a referral from the primary care physician or plan administrator. Medical necessity also addresses the need to evaluate the patient for a previously undiagnosed condition.

Question:
How should I bill for tinnitus maskers?

Answer:
I am not aware of a code for a tinnitus masker. I would advise that you use the HCPCS code V5299 (Hearing service, miscellaneous) and a description of what the device is and what you are using it for.

Question:
We are administering speech-in-noise testing in addition to word recognition testing in quiet as a part of a comprehensive evaluation. It there a way we can bill for the speech-in-noise testing in addition to what we are already billing under 92557 (comprehensive audiometry)?

Answer:
Word recognition is a part of the comprehensive nature of 92557 and typically would not be eligible as a separate procedure. If you have performed speech discrimination in quiet and then performed speech in noise as a separate procedure, you could report CPT code 92700 and submit a report justifying and describing that procedure.

Question:
How should I code for 381.81 Eustachian tube dysfunction? We have had a few patients tell us that the insurance will not pay based on that ICD9 code.

Answer:
One of the main principles of coding is that the diagnosis code must agree with who you are, what you did, and what you found. The presenting diagnosis (in this case Eustachian tube dysfunction) is the justification to get the patient through our door to see us.

As a general rule, the primary diagnosis that comes from our evaluation should be directly related to what we found based on what we did. If we found a mild conductive loss, then the appropriate diagnosis would be 389.03 and therefore 381.81 would be an appropriate secondary diagnosis.

Question:
How should I code for a hearing evaluation when the patient has normal hearing?

Answer:
You have the option of coding the referral diagnosis or from the family of what type of testing was done (i.e., hearing loss) and using the unspecified suffix (e.g., 389.9, hearing loss, unspecified). The ICD-9 system does not allow anyone to be normal, so the suggestion of using the unspecified code is a compromise that was officially adopted by the CMS on how to select a diagnosis code when test results do not show an abnormality. I would refer you to the Medicare Bulletin AB01144. If you visit https://www.cms.hhs.gov and search on the bulletin number, the document should come up in your search. You can also refer to the Medicare Transmittal 1787 available at www.cms.hhs.gov/Transmittals/Downloads/R1787B3.pdf

Question:
How should do I code for a saccades during ENG/VNG? I have been using a generic code and typically do not get reimbursed. Is there a specific billing code for saccades?

Answer:
If you are doing saccades with an OPK drum, you could bill 92544 which is: optokinetic nystagmus test, bidirectional, foveal or peripheral stimulation, with recording. If you trying to evoke them using a light bar, you could use 92545 which is: oscillating tracking test, with recording. And if you are performing a saccade using a computer screen with "dot" movement from one quadrant to another, that could be reported at 92700 with complete description of what you did, why you did it, what you found, and what you recommend.

Question:
How should I code when performing ototoxic monitoring? Is there a specific code for that?

Answer:
There is not a CPT code for ototoxic monitoring. You should use the CPT code that correctly represents what you did such as pure-tone audiometry, tympanometry, etc.

Question:
How often will Medicare cover the costs of a hearing evaluation?

Answer:
There is no limit to how many times a Medicare patient can undergo a hearing evaluation. The only requirement is that each evaluation be justified on the basis of medical necessity. The main issue with medical necessity is that it must be based on symptoms or complaints that have been previously undiagnosed, a change in presenting symptoms or complaints, or a related diagnosis that places the individual at significant risk for change in status. Re-evaluation of a previously diagnosed condition with no reported changes in status would not qualify for Medicare reimbursement.

Question:
Why is it that when my patient goes to their ENT, Medicare pays for a hearing test, but the same test in my audiology practice is not covered?

Answer:
Medicare has a "Medical Necessity" threshold for administration of all services. The hearing test that is done in the ENT's office is assumed to be medically necessary, and the ENT must have appropriate documentation is his/her chart notes justifying "Medical Necessity". For audiologists to have direct access, we would also need to abide the medical necessity threshold and have the appropriate documentation in our folders. Hearing tests cannot be rendered on a whim or because either the patient or audiologist wants to do it. They need to be evaluations that, as a general rule, are looking for a problem that is previously undiagnosed. If the evaluation is an "annual recheck" and the patient has no change in symptoms or complaints (real or perceived), Medicare should not be billed. But if the patient is having trouble and is not previously diagnosed, or has been previously diagnosed and is showing changes in symptoms or new symptoms, those would all fall under "medical necessity" for an audiological evaluation.