Making sense of CMS’ new policy on consultation billing

CMS stopped recognizing CPT consultation codes and issued instructions to physicians only a few days before the new policy took effect. ACP's practice management staff digest what internists need to know to stay atop of billing for 2009, documentation, the “3-year rule” and cross-walks for services previously billed as consultations.

Beginning Jan. 1, 2010, CMS stopped recognizing the Current Procedural Terminology (CPT) codes describing office/outpatient consultations and inpatient consultations. Instead, the agency now requires physicians to use the office/outpatient visit codes and inpatient visit codes in their place. CMS issued its instructions to physicians only a few days before the new coding policy took effect. That meant physicians had minimal time to prepare for making the necessary changes to their billing practices.

Q: Our practice has not submitted all of its claims from last year. Should we use the new coding on those claims, too?

A: No. Physicians should use the specific CPT codes for consultations done up to the Dec. 31, 2009 date of service. The new coding begins with dates of service on or after Jan. 1, 2010.

Q: Because we are still furnishing consultation services, will the Medicare requirement that the consultant send a written report and the requesting physician document the request apply even though we are billing the service with different codes?

A: No, it won't. With this new coding policy, CMS has—for its own purposes—essentially eliminated not only the consultation codes, but also its related requirements governing documentation of consults. However, although these previous Medicare documentation requirements should be disregarded for your 2010 claims, you may find it beneficial to the ongoing care of the beneficiary to continue them.


Separately, for patient referrals, the existing evaluation and management (E/M) guidelines from 1995 and 1997 are still in use; both the referring physician and the accepting physician must document the referral request for a patient evaluation. The results of the evaluation must still be communicated to the referring physician. The guidelines are available online . (Click Outreach & Education, then MLN Educational Web Guides, then Documentation Guidelines for E&M Services.)

Q: How will the “3-year rule” for distinguishing new versus established patients apply when using the office, initial hospital and initial nursing facility visit codes in place of a consultation service code? Will the rule apply when the patient is seen in different treatment settings or has a different diagnosis?

A: Per CMS, a “new patient” is defined as one who has not received any professional services within the past three years. This rule applies even if the physician provided a preoperative consultation at the request of a surgeon within the previous three years. It also applies if the patient was previously seen by the physician for a different diagnosis, or if the patient was seen in the previous three years in a different outpatient setting (such as a hospital emergency department).

Q: Will CMS publish recommended crosswalks among the consultation and visit codes, e.g., which initial hospital care service code is to be billed in place of what was previously billed as the lowest-level inpatient consultation code?

A: No, CMS is not providing a recommended coding crosswalk for the services previously billed as consultations.

Q: Should we use the office, initial hospital and initial nursing facility visit codes for billing consultations when Medicare is the beneficiary's primary insurer?

A: When Medicare is the beneficiary's primary insurer, use office, initial hospital or initial nursing facility visit codes to bill a consultation service to your CMS contractor. Then, once you have received the Explanation of Medicare Benefits (EOMB) or the remittance advice (RA) from the Medicare contractor, submit the EOMB or the RA to the secondary insurer. You might have the option of recoding the secondary insurance claim to show the CPT consultation codes; be sure to contact the patient's secondary insurer for specific instructions.

Q: Which codes should we use when Medicare is the beneficiary's secondary insurance (e.g., Medicare Secondary Payer claims)?

A: When Medicare is the beneficiary's secondary insurer, CMS offers two options.

In option 1, CMS advises that the physician bill the primary insurer using the office, initial hospital or initial nursing facility visit code. Then, along with a report of how much the primary insurer paid, the physician should submit the claim to the Medicare contractor.

In option 2, the physician would bill the primary insurer using an appropriate CPT consultation service code, then report to Medicare the primary insurer's paid amount, along with a claim showing the appropriate office, initial hospital or initial nursing facility visit code.

Q: Did CMS issue specific coding instructions, or a detailed explanation of the policy (such as an MLN article)? Why weren't practices given more time to prepare?

A: There are several documents that detail the expected coding. The primary document is MLN Matters #MM6740 , published Dec. 14, 2009 and available online . Its target audiences are physicians and practice staff. The MLN contains coding guidance that ACP requested (such as the use of the prolonged services codes), believing that the agency's guidance will be critical to physicians' successful claims submission. However, CMS will need to address remaining questions in the coming weeks and months.

In terms of the timing, ACP acted quickly after seeing that the late notice from CMS would not give physicians sufficient time to rethink and reconfigure their coding before the Jan. 1, 2010 deadline. ACP sent a letter to CMS (available online ), requesting that the agency delay implementing this policy. The issues that ACP has asked CMS to address or clarify are listed as an attachment to the letter.

Additional information on the ACP position related to Medicare's policy change for consultation services is available online .

Q: Are other insurers also eliminating payment for the consultation codes?

A: No, not to our knowledge.

ACP is monitoring the policies of commercial and private insurers and to date has seen no related policy changes. ACP will continue to watch the issue and will alert its members of any noted changes.