Procedure/Diagnosis Coding and Reimbursement Mechanisms for Physician Services in Palliative Care
EPEC Trainer's Guide 1999
Charles von Gunten, MD, PhD, Frank Ferris, MD
The objectives of this section are to:
- understand how to code for physician services related to palliative care, including hospice
- understand the difference between the reimbursement
mechanisms to be used when the patient is enrolled in the Medicare hospice
benefit and the usual reimbursement mechanisms
Physicians can code and bill for services related to palliative care by using existing mechanisms. This section first discusses coding for physician services by standard coding approaches. Then it presents how those same approaches need to be adapted when a patient has elected the Medicare hospice benefit. Finally, it describes how palliative care services other than physician services are paid.
Coding for physician services related to palliative care
Coding for physician services, whether the patient is enrolled under the Medicare hospice benefit or receives healthcare services through other funding mechanisms, almost always uses the same coding technique. Physicians code for their service to an individual patient in two parts: 1) a procedure or service code and 2) a diagnosis code.
1) Procedure or service codes
The physician selects a procedure code from the Current Procedural Terminology (CPT)TM codes published by the American Medical Association. For physicians involved in palliative care, the most frequently used codes are the evaluation and management (E/M) codes (code range, 99201-99499). There are evaluation and management codes for each of the usual settings in which physicians provide services: ambulatory outpatient, acute inpatient hospital, extended care institutions or patients' homes. Within each general category of codes (by setting) there is a hierarchy of codes from least intensive to most complex.
The Health Care Financing Administration (HCFA) has promoted extensive guidelines for the documentation that must support the use of each of the E/M codes. Related to palliative care, a little-known and underappreciated provision of current E/M coding guidelines often applies. When more than 50% of the patient-physician interaction is composed of counseling and/or information giving, then time becomes the factor that determines the level of service that is coded. As palliative care consultations and services often incorporate extensive amounts of information giving and/or counseling as part of the physician-patient interaction, then the time it takes to complete the activity determines which E/M code will be chosen. Each of the E/M codes is associated with a time element for this purpose. Table 1 indicates current codes with an amount of time associated with each.
When time is used to determine which E/M code to use, the documentation must indicate that more than 50% of the interaction was related to counseling or information giving. In the inpatient setting, the time is defined as floor or unit time, which includes the time that the physician is present on the patient's hospital unit and at the bedside rendering services for that patient. This includes time in which the physician establishes and/or reviews the patient's chart, interviews and examines the patient, writes notes, and communicates with other professionals and the patient's family.
Physicians who provide palliative care may also report codes for specific procedures or tests that they may perform (such as anesthetic injections, paracentesis, and thoracentesis). The time required to provide these procedures or tests is not included in the time used to establish the appropriate E/M code.
You are asked to provide palliative care consultation for an 86-year-old former schoolteacher who has been admitted to the hospital for exacerbation of congestive heart failure. The attending physician would like advice on managing her dyspnea. You spend an hour on the unit reviewing the chart and interviewing/examining the patient and an additional 20 minutes writing your note and conferring with the attending physician. The majority (more than 50%) of your interaction with the patient was related to eliciting her values and care goals, clarifying her understanding of her diagnosis and prognosis, and giving information and counseling. You had specific suggestions about the use of morphine to relieve her dyspnea.
You would code 99254 for this initial consultation in the hospital. In the note documenting the consultation, you would indicate the name of the referring physician, the reason for the consultation, the recommendations for medical management of the dyspnea, the fact that the majority of the interaction was related to counseling and information giving, and a summary of the situation and the information around which counseling or information giving was required. The note should indicate that the total time spent on the consultation, including the time spent in documentation and discussing the case with the referring physician, was 80 minutes.
2) Diagnosis codes
Besides CPT code, the physician describes the reason for the service by using one of the International Classification of Disease . Clinical Modification (ICD-9-CM) codes promulgated by the National Center for Health Statistics (NCHS). These diagnosis codes are published by several publishers, including the American Medical Association. The ICD-9-CM book contains not only disease codes but also many symptom codes. A few examples are indicated in Table 2.
Many physicians, particularly internists, are concerned about reimbursement for concurrent care; that is, if they see they a patient on the same day as another internal medicine specialist or subspecialist, only one of them will have their services reimbursed. In October 1995, HCFA published new rules that permit concurrent care by two or more physicians on the same day, even if they are of the same specialty. In order to describe
the legitimate differences in evaluation and management services that multiple physicians may provide to a single patient, physicians need to use different ICD-9-CM codes for diagnosis as appropriate.
For the 86-year-old woman with congestive heart failure described above, if both her general
internist and the palliative care specialist use the ICD-9-CM code for congestive heart failure,
only one submission for reimbursement is likely to be accepted and the other denied.
However, if you are being consulted for advice related to management of shortness of breath,
you would use the ICD-9-CM diagnosis code for dyspnea (286.6).
Reimbursement for physician services related to palliative care
Medicare hospice benefit background
The Medicare hospice benefit was established in 1982 to pay for hospice services at home for
Medicare beneficiaries. Provision is also made for brief periods of inpatient services.
A patient is eligible to elect the Medicare hospice benefit if the patient is confirmed by
two physicians to have a prognosis of less than or equal to 6 months if the disease follows its usual course.
The patient must acknowledge the terminal nature of the illness and sign election forms that indicate that care will be directed toward comfort, not cure of the disease.
When a patient elects the Medicare hospice benefit, care of the patient that is related to the terminal
illness is the direct responsibility of the hospice program. The benefit pays 100% for intermittent
nursing, social work, chaplain, nurse aide, physical/occupational therapy, medication and therapy related to the terminal illness and durable medical equipment.
The hospice agency receives a per diem rate to cover these costs.
This rate is set by the federal government and is not influenced by the particular treatments
or services that the patient receives. As such, it is an example of capitated medical care.
Many commercial payers have adopted similar approaches to covering home hospice care.
If a patient needs medical care that is not related to the terminal illness, then that care can
be provided and reimbursed by standard Medicare mechanisms. It is the responsibility of the
hospice physician to determine whether care is related or unrelated to the terminal illness.
Payment and coding for physician services under the Medical hospice benefit
1) Administrative/supervisory activities
As part of the benefit, the services of the hospice medical directory that relate to the administrative and general supervisory activities of the hospice are included in the per diem. "These
activities include participating in the establishment, review, and updating of plans of care, supervising care and services and establishing governing policies" (Medicare Regulations, Section 406). Therefore, the medical director
should expect his or her administrative services to be reimbursed from the hospice program in addition to fee-for-service billing for direct patient care.
2) Direct Physician services to Medicare hospice patients
Physician services related to direct patient care under the Medical hospice benefit are not covered as part of the per diem rate. Any physician who provides direct care, whether the hospice medical
director or other physicians care for the patient, needs to code for his or her services separately. The price mechanism for reimbursement depends on whether or not the physician is associated with the hospice program either as an employee or as a volunteer.
3) Attending physician, not associated with the hospice
At the time the patient elects the Medicare hospice benefit, the patient indicated who his or her attending physician will be. The attending physician for the patient who is not associated with the hospice continues to code for physician services using CPT and ICD-9-CM
in the way described above and submits bills for reimbursement to Medicare under Part B (the federal Medicare program that funds physician services from payments made by beneficiaries).
However, for paper claims, the physician must indicate on the HCFA-1500 claim form that he or she is the attending physician and not an employee of the
hospice program that is caring for the patient when each claim is submitted. If this statement is not present,
the services are likely to be denied. For physicians who submit bills electronically (EMC), an HC modifier must be appended to the CPT code. The fiscal
intermediary will then telephone the physician's office for further information. When the carrier calls, the information they need is, "This is a hospice patient; Dr. X is the attending physician and is not employed by the hospice."
4) Attending physician associated with the hospice
If the attending physician is associated with the hospice agency (eg, medical director or hospice physician), as a salaried employee or even as a nonsalaried volunteer, then
codes for physician services are submitted to the hospice agency and submitted by the agency to Medicare under Part A (the federal Medicare program that covers institutional and nonphysician services funded by payroll deductions). This is
a marked departure from other standard approaches to coding and billing for physician services. The hospice agency will submit these bills and are paid at 100% of the usual
and customary fee reimbursed under Medicare Part B schedules. The hospice agency then can pass this reimbursement on to the physician as part of his or her negotiated salary or fee-for-service arrangement.
5) Consulting physicians
Consulting physicians who are asked to see the patient by the attending physician can also submit claims for the services they have provided to patients who have elected the Medicare hospice benefit.
However, they must submit their code claims directly to the hospice agency, which in turns submits the claims for reimbursement under Part A. This consultants must have a contract with the hospice agency in order for this to occur.
Payment and coding for physician services outside the Medicare hospice benefit
1) Hospice under Medicaid/public aid
Hospice care is reimbursed by many states for their indigent patients. The Medicaid and public aid budgets are administered by individual states, not the federal government.
However most states have adopted HCFA/Medicare guidelines for patients who are receiving hospice care. Consequently, the coding guidelines outlines for the federal Medicare hospice benefit also apply.
In state-managed programs, it is important that practitioners become familiar with the rules and regulations in the individual states in which they are practicing.
2) Private insurance
Most commercial payers (ie, health plans, insurance companies) require physicians to code for their services by means of CPT and ICD-9-CM codes. Physicians code
and submit their claims for reimbursement regardless of whether a patient is covered by a hospice benefit. Again, specific regulations regarding coding may apply
for an individual payer. Information on these rules should be obtained before claims are submitted.
3) Palliative care services for patients under Medicare
Physicians may see patients for purposes of delivering palliative care services when they are still covered under Medicare. Use the coding procedures
outlines in the first part of this document and submit them to the Medicare fiscal intermediary in your area in the usual way.
Funding for nonphysicians providing palliative care services
Under the Medicare hospice benefit, the per diem fee covers all services of nonphysician healthcare professionals who provide care to the patient and
family. However, patients who are not eligible or appropriate for enrollment under the Medicare hospice benefit may have legitimate needs for interdisciplinary palliative care
services. The challenge is how to pay for the nonphysician component of such services. Many healthcare professionals, such as nurse practitioners, clinical nurse specialists, social workers,
and chaplains, can access fee-for-service billing for patients not enrolled in the Medicare hospice benefit. In many settings, this has not been explored but is available. More commonly, these services are included as part of a larger program of services.
For example, when a patient is hospitalized, the hospital reimbursement rate includes nursing, social work and chaplaincy services.
Summary of some cpt evaluation/management codes
|New/office||Established office||Initial hospital||Subsequent hospital|
|99201 10 min||99211 5 min||99221 30 min||99231 15 min|
|99202 20 min||99212 10 min||99222 50 min||99232 25 min|
|99203 30 min||99213 15 min||99223 70 min||99233 35 min|
|99204 45 min||99214 25 min|
|99205 50 min||99215 40 min|
|Nursing home-C||Nursing home-F||Home-new||Home-Established|
|99301 30 min||99311 15 min||99341 20 min||99347 15 min|
|99302 40 min||99312 25 min||99342 30 min||99348 25 min|
|99303 50 min||99313 35 min||99343 45 min||99349 40 min|
|99344 60 min||99350 60 min|
|99345 75 |
| Prolonged service face-to-face office/home|| Prolonged service face-to-face inpatient|
|99354 30 min||99356 30 min|
|99355 each subsequent 30 min||99357 each subsequent 30 min|
A consultation is a type of service provided by a physician whose opinion or advice regarding evaluation and/or management of a specific problem is requested by another physiscian or other appropiate source. A physician consultant may initiate diagnostic and/or therapeutic services. The request and the need for consultation must be documented in the medical record. The opinion and any services ordered or performed must also be documented. A "consultation" initiated by a patient and/or family, and not requested by a physician, should be reported by means of codes for confirmatory consultations or office visits, as appropiate. The follow-up codes should not be used if the consultant assumes responsibility for management of a portion or all of the patient's condition(s).
|Office/home||Initial hospital||Follow-up hospital||Confirmatory|
|99241 15 min||99251 20 min||99261 10 min||99271|
|99242 30 min||99252 40 min||99262 20 min||99272 Low severity|
|99243 40 min||99253 55 min||99263 30 min||99273 Moderate severity|
|99244 60 min||99254 80 min||99274 Moderate to high|
|99245 80 min||99255 110 min||99275 min Moderate to high|
Some common ICD-9 codes physicians may use in palliative care*
|Agitation||307.9||Mental status change||780.9||Pain: abdomen||789.0|
|Confusion||298.9||Nausea & vomiting||787.01||Pain: back||724.5|
|Debility||799.3||Weight loss||783.2||Pain: foot||729.50|
|Dementia||298.9||Shortness of breath||786.09||Pain: hip||719.45|
|Depression||311|| || ||Pain: muscle||729.1|
|Delirium||780.09|| || ||Pain: sacroiliac||724.60|
|Diarrhea||558.9|| || ||Pain: throat||789.1|
|Fatigue||558.9|| || ||Pain: neck||723.1|
|Fever||780.6|| || || || |
|Headache||784.0|| || || || |
|Hemorrhage||459.0|| || || || |
*Refer to the full tabular list of ICD-9-CM codes to ensure coding at the highest degree of accuracy.
© EPEC Project, The Robert Wood Johnson Foundation, 1999
The Project to Educate Physicians on End-of-life Care comes from the
Institute for Ethics at the American Medical Association. Permission to produce
for non-commercial, education purposes with display of copyright and attribution
Emanuel LL, von Gunten CF, Ferris FD. The Education for Physicians on
End-of-life Care (EPEC) curriculum, 1999.
Special thanks to the EPEC Team, the EPEC Advisory Group, and all other
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