Medicare Reimbursement for Emergency Physicians

Medicare reimbursement rates are extremely important for emergency physicians. Not only do they affect Medicare payments, but they serve as the basis for which private payors establish their own individual payment levels.

Over the last few years, the Centers for Medicare & Medicaid Services (CMS) has increased and subsequently maintained the value of the emergency department (ED) evaluation and management (E/M) codes–the most commonly billed codes for emergency medicine. This increase was the result of many months of behind-the-scenes work by ACEP.

What’s the Latest?

While ACEP has been able to secure increases to the values of the ED E/M codes, unfortunately, we are still dealing with potential across-the-board reductions to Medicare physician payments. In the CY 2023 PFS final rule, CMS finalized a 4.5% cut to the PFS conversion factor.  Along with this reduction, the 2%. sequestration reduction continues to apply year after year. Furthermore, there is another “Pay-Go” sequester of 4% that is scheduled to begin at the start of 2023—making the total overall projected cut starting January 1, 2023 at 10.4%. In short, Medicare payment to physicians is simply inadequate.

ACEP is pushing Congress to enact meaningful physician payment reform that will add more stability to the PFS. We also are encouraging CMS to do everything within its authority to mitigate the reduction.

The Process

Each year CMS identifies specific physician codes that the agency believes are valued too high or too low. CMS sends this list of potentially mis-valued codes to a committee run by the American Medical Association (AMA) called the Relative Value Scale Update Committee (RUC). Through the process (described below), the RUC makes specific recommendations for the values of each of the CMS codes. CMS then decides, through federal rulemaking, whether to accept or reject the RUC recommendations for each code.

What is the RUC?

The RUC comprises 31 members representing the entire medical profession, including 21 who are appointed by specialty associations. Members represent those recognized by the American Board of Medical Specialties. ACEP is the only emergency medicine organization with a seat at the RUC table.

Each society represented on the RUC, including ACEP, works through the following process:

  1. Conduct Surveys
    The specialty societies send out standardized surveys to other physicians in their society and obtain data on the amount of work involved in a service. The societies are required to survey at least 30 practicing physicians. Each code includes three components (work associated with the service, practice expense and malpractice expense), but the survey is focused on the work component, asking its members questions about the time and intensity of the services under review. After conducting the surveys, the specialty societies review the results and prepare their recommendations for the appropriate value of the codes.
  2. Review Survey Results and Prepare Recommendations
    The specialty society RUC Advisors present their recommendations to voting RUC representatives.
  3. Present Recommendations to the Full RUC
    Convincing the RUC to revalue a code is tricky because due to a budget neutrality requirement under the Medicare PFS, any increase in the value of one code results in a corresponding decrease in the value of all other codes.
  4. RUC Votes on Specialty Society Recommendations
    The RUC may vote to accept a specialty society’s recommendation, refer it back to the specialty society, or modify it. Final recommendations to CMS must be adopted by a two-thirds majority of the RUC members.
  5. RUC Sends Final Recommendation to CMS and CMS Reviews Recommendation through PFS Rulemaking
    CMS reviews the RUC recommendations through the formal Medicare Physician Payment Schedule (PFS) rulemaking process. The PFS proposed rule is typically released annually in July, followed by the final rule in November—affecting physician payment rates for the following calendar year.

How do emergency physicians get reimbursed through Medicare?

The annual Medicare Physician Fee Schedule (PFS) regulation makes updates not only to Medicare physician payments for the next calendar year, but also to the Quality Payment Program (QPP), the major quality reporting program for physicians under Medicare. Failure to successfully participate in the Merit-based Incentive Program (MIPS)—the main track within the QPP—could result in a 9% reduction to emergency physicians’ Medicare payments. 

Advocating for Emergency Medicine

As the only voice for emergency medicine on the RUC, ACEP has an appointed RUC Representative and an Alternate RUC Representative who both attend RUC meetings as voting representatives of the House of Medicine. The representatives are not there to advocate for their individual specialties, but rather to contribute their specialized content knowledge to the deliberating body. The RUC team, which includes both ACEP members and staff, conducts the detailed membership surveys as part of the RUC process and provides information and evidence for our RUC representatives to use during his/her presentations to the committee.

What has ACEP done for you?

In 2017, CMS identified the ED E/M codes as potentially mis-valued. These codes, which include five levels of complexity (Levels 1-5), are billed by the majority of our members and represent roughly 85% of EM services.

ACEP’s RUC team managed the RUC’s review of these codes—first surveying ACEP members and then using the survey results to develop recommendations for the RUC. It’s not easy to convince the RUC to increase the value of a code because a budget neutrality requirement under the Medicare PFS dictates that any increases in the value of one code means a corresponding decrease in the value of all other codes. An increase in one specialty’s code results in decreasing the code for another specialty. During the last RUC cycle, only approximately 9% of codes identified as potentially mis-valued received value increases.

Our team knew we had to provide a very compelling argument to convince at least two thirds of the other RUC voting specialties to support our recommended values. Using the data collected through our member surveys, the team convinced the RUC that the ED E/M codes were undervalued. The RUC approved increases of 1.5% to 6.5%  for Levels 1 through 4 while keeping Level 5 the same.

In the Calendar Year (CY) 2020 PFS final rule, CMS accepted the RUC’s recommendation, thereby resulting in an increase in ED E/M Medicare payments of approximately $130 million in 2020 before any additional budget neutrality adjustments.

However, in that same year, CMS also announced that it was seeking to revalue the office and outpatient evaluation and management (E/M) codes for 2021. Medicare requires that overall changes to Medicare physician payments be budget neutral, so this adjustment to the office and outpatient E/M codes was likely to reduce reimbursement to emergency medicine. So, while emergency physician services were more appropriately valued in 2020, payments for these same services were going to be significantly reduced the following year. 

Understanding the potential for this reduction in reimbursement in 2021, ACEP advocated strongly for corresponding increases for the ED E/M codes levels 3 through 5 (CPT codes 99283, 99284, and 99285). ACEP also provided data and a solid policy argument directly to CMS and the White House to help strengthen our case. That advocacy paid off, and CMS adopted our increased code values for the ED E/M codes in 2021. Thus, ACEP was able to secure increases to the ED E/M codes in both 2020 and 2021.  

Finally, for 2023 payments, ACEP was able to fight off another potential reduction. The AMA RUC recommended that the RVUs for the ED E/M level 4 (CPT 99284) should decrease. However, in the CY 2023 PFS final rule, CMS rejected the AMA RUC recommendation, and instead continue to rely on ACEP’s previous argument that the ED E/M codes should retain their relative values as compared to the office and outpatient E/M codes in order to reflect their higher typical intensity. This rule is significant since the ED E/M Level 4 service is one of the most commonly billed codes among emergency physicians. A decrease in the RVUs, on the whole, would reduce emergency medicine reimbursement by millions of dollars. This is another example of the effectiveness of ACEP’s advocacy.

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