CMS proposes major changes to E&M guidelines.

Well, we have heard it for years: evaluation and management (E&M) guidelines need an overhaul. And now we have a proposal on the table.

Before we get into the proposed changes, think for a moment: if you had full autonomy, how would you modify the E&M guidelines? While I have dedicated my career to healthcare and training, over the past three years I have focused on E&M, and I have been fortunate to have traveled the country extensively teaching thousands the rules that do exist and the rules that don’t. I have had many occasions to sit and think about how I would modify E&M, and quite frankly, it consistently brings me back to where I started, in consideration of do they really need to be changed? Or do we just need clarity and guidance?

So, before you go any further, I ask you to pause and carefully consider: would you change E&M? If so, how would you change it? Would your change be to the documentation requirements, or the payment model, or both? Once you take this pause, then consider the actual proposed changes and what your opinion is.

I want to be clear that my intent in this article is to try to remain unbiased and simply “report the news” of the update. If you want my opinion – and well, if you know me, you know I have one – just ask me. But first form your own opinions and interpretations of the changes.

It is best to start with the proposed payment model change, because this makes the changes to documentation and the additional codes created more consumable.

E&M Payment Model Changes

Let’s start by identifying that these proposed changes would impact only office/outpatient service codes. Quite frankly, calling it a payment model is overstating things, because in reality, the proposed change creates a flat reimbursement, as opposed to a reimbursement driven by the complexity of care the patient’s condition predicates. Levels of service 2-5 (99202-99205 and 99212-99215) would be paid a flat fee. CMS has proposed a work and practice expense relative value unit (RVU) for these considerations, and based only on those 2 RVU components, the flat rate reimbursement would be around $129 for new patients and $88 for established patient services (using the formula of proposed wRVU + proposed peRVU x $35.99 = the 2018 conversion factor).

How will this reimbursement rate impact your practice? Below is a chart that shows the side-by-side comparison of the current wRVU + peRVU x 2018 conversion factor and the financial impact per current assigned level of service:

CPT® Code Impacted

2018 W + PE

2019 W + PE

Reimbursement Impact










































Please keep in mind that these RVU allocations are proposed by CMS, but we have no comment by the RVU Update Committee (RUC) of RVU consideration at this time. However, based on the proposal, practices that utilize lower levels of E&M services may see an increase in E&M reimbursement, while those utilizing higher-level E&M services may see a decrease in revenue. To help compensate for the decreased reimbursement, CMS has proposed a series of add-on G codes that we will discuss during a forthcoming article.

Therefore, regardless of what E&M code you choose within this category, your reimbursement would be the same. CMS considered proposing G code usage in lieu of this E&M code set, but instead it felt it best to keep the current codes to limit the number of changes needed. If the proposed change is accepted, you would continue to choose the E&M level of service that best represents the patient encounter just as you have been, but your reimbursement would not be impacted – rather, there would be a flat fee.

Documentation Relaxation

CMS has made an attempt to decrease the administrative burden providers experience as it pertains to documentation requirements. In order to do so, CMS has proposed that all services would use one of three forms of documentation support:

  • Medical decision-making (MDM) only would be used to support the flat-rate reimbursement.
  • Time only would be used to support the flat-rate reimbursement.
  • Providers would continue to use the current E&M framework as it exists today.

Regardless of documentation technique, style, or content, the reimbursement would be at the new blended rate for levels 2-5.

Because the note now would be supported based only on MDM or time, the documentation burden would be lifted, and for those providers choosing to continue with the current E&M framework, modifications were included to ease their documentation requirements as well. The maximum documentation requirements for all office/outpatient E&M services would be that of a level 2 encounter under the flat-rate system.

Consider the impact, based on documentation style:

  • If documenting with the current framework, then the history, exam, and MDM (or two of the three) would at a minimum need to support a level 99202/99212, unless you are reporting a 99201/99211 service.
  • When using MDM as the supporting element, only the MDM would be required to support a level 99202/99212, unless you are reporting a 99201/99211, and there would be no requirements of the two or all of the three rules followed for new/established patient documentation.

Notice that we did not discuss time above, and that is because it is proposed that time would follow a new set of standards. First, time could be used even when counseling and coordination of care do not dominate the encounter. So for literally any visit, for any reason, time, along with a medical necessity statement appropriate to support the encounter, would create a billable encounter. CMS considered using the time benchmarks currently associated with these E&M services; however, since the codes would no longer (under CMS) require counseling and coordination of care, they felt it best to propose new parameters. The new time requirements would be:

  • For new patient services: 38 minutes, and based on CPT® guidance, a minimal threshold of 20 minutes has been proposed.
  • For established patient services: 31 minutes, and based on CPT guidance, a minimal threshold of 16 minutes has been proposed.

Using MDM or time to support E&M services would eliminate any expectations of history of present illness (HPI), review of systems (ROS), past, family, and/or social history (PFSH), or exam, provided that medical necessity for the visit is still noted within the context of the documentation. Therefore, CMS indicates that the history and exam would only need to include what has or has not changed from previous encounters, with no need to re-document this information. In addition, CMS would waive the requirements that the provider of the encounter regurgitate the chief complaint and/or the HPI documented by ancillary staff.

Opinion and Comments

So, I must ask you: what do you think? While we still have not addressed the new add-on codes and their reimbursement impact, how do you see these changes impacting your practice, and how do you think they will impact healthcare across the board? Don’t forget, form your own opinion, and voice your comments to CMS before Sept. 11, 2018. Below we have provided you information on how to submit your comments.

We will address the proposed guidance for new add-on codes and their reimbursement impact on the flat fee model in Part 2 of this series.

Submitting your comment(s):

  1. Submit electronic comments on this regulation to Follow the instructions for “submitting a comment.”
  1. Mail written comments to:

CMS-1676-P 2
Centers for Medicare & Medicaid Services, Department of Health and Human Services, Attention: CMS-1676-P
P.O. Box 8016
Baltimore, MD 21244-8013.

Allow sufficient time for mailed comments to be received before the close of the comment period.

  1. Send by express or overnight mail. You may send written comments to:

Centers for Medicare & Medicaid Services, Department of Health and Human Services, Attention: CMS-1676-P
Mail Stop C4-26-05
7500 Security Boulevard
Baltimore, MD 21244-1850.

  1. Deliver (by hand or courier) written comments before the close of the comment period to:

Centers for Medicare & Medicaid Services, Department of Health and Human Services,
Room 445-G, Hubert H. Humphrey Building,
200 Independence Avenue, SW., Washington, D.C. 20201


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