WASHINGTON — Medicare should ditch “incident to” billing by non-physician practitioners and develop national guidelines to prevent hospital emergency departments from inappropriately coding the care they deliver, the Medicare Payment Advisory Commission (MedPAC) urged in its June report.
The commission also recommend no changes in the Medicare payment update for clinicians, based on a variety of factors, which include beneficiary access and the available supply of clinicians.
MedPAC, an independent body of experts tasked by Congress with advising the Secretary of Health and Human Services Secretary on Medicare payment issues, publishes two reports each year.
NP and PA Billing of Services
In this latest document, the commission zeroed in on the issue of “incident to” billing of Medicare services by advanced practice registered nurses (APRNs) and physician assistants (PAs). It suggested that Congress eliminate the mechanism and instead have such clinicians bill the program directly for all services.
Under current policy, Medicare allows APRNs and PAs, under certain circumstances, to bill “incident to” physician services. In other words, the practitioner uses a supervising physician’s own national provider identifier (NPI) to bill Medicare at 100%; however, when NPs and PAs bill directly under their own NPI, those services are billed at 85% of the fee schedule amount, MedPAC’s technical staff explained at a meeting in December.
“Incident to” billing is thus a mechanism to increase reimbursements to advanced practitioners, at corresponding cost to Medicare. It’s not available to NPs and PAs when working in a hospital with a new patient, or for a new problem with an existing patient.
The June report notes that while there has not been a great deal of research on “incident to” billing, MedPAC’s own analyses suggest that “a substantial share of services furnished by NPs and PAs to Medicare FFS beneficiaries was likely billed ‘incident to’ in 2016,” the report noted.
At the December meeting, MedPAC’s staff pointed out a related concern around NPs and PAs increasingly choosing to practice in specialty care rather than primary care.
“Given the growing roles of NPs and PAs and their shift away from primary care, Medicare’s ‘incident to’ rules and lack of specialty data create several problems, including obscuring important information on the clinicians who treat beneficiaries and inhibiting Medicare’s ability to identify and support clinicians furnishing primary care,” noted the report.
For that reason, in addition to recommending scrapping these “incident to” rules, the commission also recommended that the HHS Secretary should “refine Medicare’s specialty designations” for APRNs and PAs.
Together, the two recommendations would allow policymakers to “target more resources toward primary care,” the June report noted.
Coding of Emergency Departments Visits
Also highlighted in this June report were concerns over possible “upcoding” of emergency department visits. Currently, hospitals establish their own internal guidelines for the coding of ED visits.
From 2002 to 2006, the Centers for Medicare and Medicaid Services (CMS) observed a “a normal and relatively stable” distribution across visit levels. In a system where Level 1 is the lowest — least serious — and Level 5 the highest, the most frequent visits were coded as Level 3 visits, noted the report.
However, from 2005 to 2017, the proportion of ED visits coded as Level 1 or 2 plummeted from 28% to 7.5% and the share coded as Level 5 shot up from 11.2% to 30%.
If that shift in coding could be attributed to seeing sicker patients who required more intensive care or increased hospitals resources in EDs, which resulted in better outcomes, then such a change — and the corresponding change in Medicare payments — would be warranted, the report noted.
But MedPAC suspects hospitals were instead gaming the system, “providing more resource-intensive care that had little or no effect on patient outcomes,” or simply “upcoding” without actually changing patients’ care. Data reviewed in the report indicated that the principal diagnoses and patients’ reasons for going to the hospital “changed little over time.”
The commission also found “substantial geographic variation” in coding level patterns. For instance, hospitals in Detroit coded 46% of visits to Level 5 versus 22% by hospitals in Los Angeles.
MedPAC determined that CMS’s current policy of allowing hospitals to create their own internal guidelines for coding is too lax. Instead, the report said the Department of Health and Human Services should “develop and implement” national coding guidelines for EDs by 2022.
This is not a new idea, but the suggestion has been ignored in the past, due to its perceived complexity.
Previous guidelines developed by the American College of Emergency Physicians, and/or the American Hospital Association with the American Health Information Management Association, could serve as a “starting point” for the agency, the report noted.
As required by Congress, the Commission must study the payment adequacy of individual categories of the program, and this includes clinician payment.
To complete its review, MedPAC must evaluate access to care (through direct and indirect measures), the supply of clinicians billing Medicare, quality measures, and clinician input costs.
While these have moved around a bit, the magnitudes were too small to warrant payment updates for 2020, the report indicated.
For example, the commission found that the proportion of Medicare beneficiaries waiting for care “longer than they wanted” has inched up slightly, but not enough to conclude that access to care is inadequate.
Clinician participation is also strong, the report noted. More than 95% of clinicians bill Medicare and that rate has been growing. Growth in participation by APRNs and PAs has been especially strong, at about 10% per year.
In all, fee schedule volume edged up about 1.0% from 2012 to 2016 and 1.6% from 2016 to 2017, the report noted.
“On the basis of these indicators, the Commission recommended no update for clinician services in 2020, which is current law,” the report noted.