New E/M Office Visit Codes Take Effect January 1, 2021 – Are You Ready?
It’s been almost 30 years since the CPT codes that physicians and other practitioners are paid under the Medicare Physician Fee Schedule (MPFS) for common office or other outpatient visits for evaluation and management (E/M) services have been revised. These CPT code sets, which include 99201-99205 for new patients and 99211-99215 for established patients will be getting a face-lift effective January 1, 2021, that includes, among other things, a new code to report incremental time incurred for prolonged office or other outpatient services.
For 2021, CMS will move from a points-based system, which focused upon levels of documentation, to a medical necessity-based system. It is important to understand that this does not mean that physicians should reduce the documentation or supporting facts for a specific diagnosis. In fact, the expectation is that there will be a higher level of quality documentation under the new guidance. This may result in a reduced level of documentation and more focus on supporting the medical necessity of the diagnosis.
Providers will need to change their focus when documenting cases and retool their quality assurance reviews to ensure that they are focused on the quality of documentation and not necessarily the quantity.
Verify Those Insurance Cards
Due to the COVID pandemic, unemployment is up, and there has been a significant level of shift in where people are working. This could mean that patients no longer have the insurance that they have had in the past. It may be a good time to have patients once again update their insurance information with your office, and for you to verify coverage to make sure insurance is still in effect. Failure to do so may impact reimbursement to the practice for services.
2020 American Physician Survey
In its biennial Survey of America’s Physicians, the Physicians Foundation reported that nearly half of reporting physicians do not believe that the COVID pandemic will be under control until after June 1, 2021. What’s more, approximately 72% of physicians are concerned that COVID will severely impact patient health outcomes going forward due to delays in routine care during the pandemic.
And while COVID is anticipated to have a negative impact on the patients that practices serve, it is also expected to have a significant impact on the fiscal health of the practices themselves. Since the COVID pandemic started, it is estimated that some 16,000 physician practices have already closed (approximately 8% of practices). In addition, 43% of physician practices have reported staff reductions due to COVID. 78% of physicians have reported a decrease in volume since the pandemic hit in March with 37% reporting a drop of under 25% and 41% experiencing a loss in excess of 25%. Finally, 52% of physicians anticipate that they will increase their use of telemedicine over the next year; which can be a potential growth area for many practices.
Practice Enhancement Strategies
With most physicians reporting declines in revenues, it is more important for physicians to spend time working on their practice and not just in it. Physicians need to look for ways they can improve operationally efficiencies and reduced cost/waste. Here are a few of our ideas:
Use of Technology:
There are many back-office software programs that can streamline processes such as purchasing, bill paying, file storage, and recovery, etc. In addition, software exists that can streamline your scheduling, follow-up, onboarding, and verification processes. Consider exploring ways to efficiently implement technology into your practice. While sometimes difficult at first, software should help practices automate tasks and operate more efficiently in the long run.
make sure your staff are properly trained to do their jobs. We often see administrative staff that doesn’t fully understand their assigned responsibilities or how to utilize the software applications necessary to do their jobs. This results in excess labor costs that may not be necessary. In addition, with the uptick in cyber crimes with people working remotely, make sure you are providing regular training of your staff on phishing and other cybersecurity schemes.
Review your insurances:
For many practices, insurances are one of their largest costs. Between malpractice costs and health insurance, practices are paying a lot, and are experiencing large increases each year. Talk to your broker about high deductible medical plans coupled with a Health Savings Account (HSA) or a PEO that may be able to significantly cut your medical costs and, with drops in revenue, you may be able to lower your malpractice premiums.
Talk to your landlord:
The COVID pandemic has shown that many businesses can operate remotely. This has resulted in a reduction in the need for office space. Going forward there will most likely be a greater supply of office space than demand. Understanding this, your landlord may be motivated to work with you on your lease to keep you as a tenant, especially if your lease is close to coming due.
Kimberly R. Roffi, CPA
Kim, who has been a member of the firm since 2001, has over 19 years of public accounting experience. Today, she is a partner of the firm and previously served as Director for the firm’s tax and business advisory practice and Director of Finance and Operations for the firm internally. Kim has written Practice Insights for Lexis Nexis’ tax research platform and has been published in Building Long Island magazine.