Beyond Coding & Documentation: The Impact of the 2021 E/M Changes, Part 2

Welcome to Part 2 of our ongoing series, 2021 E/M Changes: The Impact Beyond Coding & Documentation. In this series, we aim to cover the impact the 2021 E/M guidelines changes are having across organizations. In the second part of the series, we’re turning our focus to the Revenue Cycle. Let’s dive right in...

The Impacts on Revenue Cycle

The 2021 E/M guideline changes affect organizations in unique ways based on payor mix, specialty, payor contracts, and coding and documentation practices. Clearly, specialties that are heavy in office-based services are going to be more affected. Surgical-based practices will be less affected by the changes. For those organizations that are, we can assume some significant changes are in store.

First, it should be noted that these changes are being implemented amid a public health emergency (PHE). The revenue cycle is already impacted by COVID nationwide. Many organizations now have employees performing critical components of the revenue cycle who have been transitioned to remote working environments. That includes providers. CMS allowances for changes in originating site means providers can perform telehealth services, at least during the PHE, from their home. Aside from the E/M guideline changes, I think it is safe to say that the revenue cycle has already been significantly affected.

Patient scheduling may not seem like an area that would typically be affected by these changes, but this component of the revenue cycle is affected now that visits can be based on time or MDM and, more importantly, that choice can be made visit to visit. How is patient scheduling affected in your organization?

  • What is the complexity of problems among patients?
  • Are there certain presenting problems that may lend themselves more toward billing based on time?
  • Are there a certain number of problems addressed at a visit where billing on time is advisable?
  • Are there patients whose visits take longer, for various reasons?

Having managed medical practices for many years, I know all too well that changes in provider schedules is not something that can happen spontaneously. These guideline changes affect the complexity of patient scheduling, and this is certainly a discussion that needs to be had and may require some trial and error before finding what works best for your organization.

These new guideline changes are going to take providers and coders some time to adjust to the documentation changes and coding methodologies. That may affect your charge capture time. For organizations that find themselves coding heavily on time, you may find that your charge capture time is less. Now that time has been expanded to include total time spent by the provider, including documentation time, there is incentive to complete dictation the same day as the visit. Regardless, anything new has an adjustment period.

Coding is another area of the revenue cycle that are impacted by the guideline changes. Whether charges are coded by providers or coders, the changes in documentation could be quite significant. Not only can visits now be leveled on time or MDM, but the American Medical Association has provided us with some definitions for the components of MDM that we did not have before. While those definitions are intended to provide clarity and eliminate subjectivity, the new guidelines do place a heavier responsibility on coders to understand the disease process.

audit-analytics papers

The 2021 E/M guidelines established new time parameters. We recommend organizations have an audit process in place to review coding to ensure accurate application of the guidelines. Whether this means you have an internal audit process, or use a 3rd party vendor, it is still your organization's responsibility to ensure accuracy. This audit process could extend your total days in Accounts Receivable for a period. AAPC Services did their own 2021 Case Study that compared coding practices under the 95/97 guidelines as well as applying the new 2021 E/M guidelines, which was very revealing. Of note, there is an increased risk of under-coding with the new guidelines changes, particularly for certain specialties. So it is very important to have an audit process in place. Claims submission is the revenue cycle component where claims are scrubbed. It is anticipated that RCM systems will create new claim edits incorporating the 2021 E/M guideline changes. It may take billers some additional time to adjust to those new edits. We can expect new edits for time and certainly for the new prolonged service codes. Additionally, payors will have to decide if they are using the AMA’s or CMS’ definition for prolonged services, so a claim edit comparing prolonged service code to payor is not unexpected. Certain specialties we are going to see a shift in coding patterns with the new guidelines. We can anticipate payers will be analyzing some of those larger shifts. It is not unreasonable to assume payers will be instituting more pre-payment reviews, and requesting medical records to validate medical necessity - particularly where we see high utilization of 99205 or 99215 and use of the new prolonged services code. There is an increased risk of audit as we see coding patterns shifts.

And finally, an industry concern worth considering is the downstream effect on risk adjustment, with resulting changes in documentation from E/M guidelines changes. With the reduction in documentation requirements, there are considerations that need to be made on how the documentation changes affect how services are valued from a risk perspective.


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