E&M Coding: The Final Level of Care

October 13th, 2014 / By Rebecca Caux-Harry

In keeping with the theme of previous blog posts–the professional realm of E&M coding–I’d like to discuss medical necessity as it relates to the final level of care. CMS has stated that medical necessity is the over-arching criterion for payment of E&M services, which, in pure CMS fashion, gives us a goal, but not guidelines as to how to get there. We have no medical necessity policies for the differing E&M codes.

I think we all understand the intent of that statement, which I interpret as “don’t game the system”. But how do I, as a coder, teach a provider how to do that? And, how does the provider document a record to reflect the medical necessity clearly? So, let’s put a pin in that and talk about the calculation of the E&M codes, then circle back.

We have two ways of calculating the final level of care based on the visit type. Initial visits, new patients, consults and ED visits require all three sections of the E&M note when calculating the final level of care. The lowest documented section, therefore, becomes the limiting factor driving the level of care. For instance, if the provider documents a detailed history, a comprehensive exam (regardless of exam guidelines followed) and a high Medical Decision Making (MDM) for a new patient, the detailed history brings the final level of care down to a level 3 code. So, for these visit types MDM will always be included in the calculation of the final level of care.

Established patient visits are different. The calculation of the final level of care only requires two of the three sections to support the code. A provider or coder may select which two sections they use, usually defaulting to the highest two of the three. So, using the example above, a coder may use the comprehensive exam and high MDM to calculate their code, resulting in a level five. Back when I started coding, providers would perform their evaluation according to their medical training and document their findings. Their training would guide how much or little evaluation was performed. As a result, when reviewing records for simple issues, I would see a very short note with minimal capture of data resulting in a lower level of care.

Now, however, with providers using EMRs and check lists, we see comprehensive capture of data for most, if not all patients. I get it. When presented with a list of things to do, I do them; all of them. So do most providers. This has resulted in what is now being called “note bloat”. By the way, this note bloat and subsequent higher codes is now on CMS radar. CMS has directed RAC auditors to look at higher levels of care for appropriateness, targeting 99215.

So, let’s change the example. We now have a record for a patient presenting with a boo-boo. The provider documents a comprehensive history and exam with straight-forward MDM. Following the “highest two of the three sections” logic, this note would qualify for a level five. But is the medical necessity really there to support this level five? I don’t think so. However, I’m not qualified to determine which portion of the service the provider shouldn’t have performed and documented.

Some groups are now using the MDM section as a proxy for medical necessity. These two things are not the same, but they are closely related. The MDM section of the scoresheet seeks to quantify the thought process of the provider as it relates to the patient’s specific condition. This section captures the number of diagnoses and/or treatment options and whether the issue is stable, worsening, new or established. It also captures diagnostic work done, ordered or reviewed, as well as the risk of the patient. Since all of these items are directly linked to the medical necessity of the visit, MDM is a good proxy. With that in mind, even though it isn’t a written direction from CMS or CPT, many of us are using MDM to guide selection of the final level of care. Some coders will make sure the History and Exam support whichever code the MDM supports; some are using MDM plus either History OR Exam to select the final level of care. Either way, we are following the directions provided by CPT and CMS plus adding some stricter internal guidelines for code selection. Each compliance department or coding manager must decide how they are going to address possible over-documentation as a result of EMRs to insure compliance to the guidelines.

Without updated E&M guidelines that take over-documentation into account, we are left to our internal guidelines to guide code selection. As long as we apply those guidelines consistently we will remain in compliance. And, let’s never forget what happened the last time we requested an update to the E&M documentation guidelines. <shudder> A perfect “scary tale” for this special time of year.

Rebecca Caux-Harry, CPC, is the CodeRyte Product Specialist for Cardiology with 3M Health Information Systems.