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Consultation Codes: Medicare Sends A Message To Specialists

A study published in this week’s Archives of Internal Medicine looked at so-called errors made in consultation code billing by specialists seeing patients at the request of a primary care practice in suburban Chicago. The methodology? Comparing the primary care office referral form with the specialist’s bill.
The author concludes that specialists are greatly overusing consultation codes in situations where a new patient visit would be more appropriate, to the tune of over half a billion dollars a year in Medicare payments, and suggests that it is time to reconsider the use of these codes. (Medicare, of course, has already come to the same conclusion, and beginning January 1 of this year, is no longer paying for consultation codes.)

There may be misuse of consultation codes going on, but this study does not necessarily prove that. The methodology does not include medical record review, the standard by which coding choices are verified or refuted, and relies entirely on the referring physician’s determination of what the specialist should be billing.

How does CPT define a consultation? It says simply this –

“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 physician or appropriate source.”

Pretty vague, right? It is this vagueness that has allowed for the widespread use of consultation codes. Notice I said “widespread” and not “overuse”. One could argue that CPT’s is deliberately vague so as to allow specialist physicans to code consultations in a variety of clinical scenarios, which is in fact what they do. This is not necessarily “erroneous billing”. The term “overuse” implies fraud, and places blame at the foot of the specialist for our healthcare costs.

Medicare clearly does not want to pay for consultations anymore. We get that. But to imply that this is because doctors are overusing consultation codes or billing erroneously is to place blame on docs, rather than just admit that Medicare is looking for ways to shift payments towards primary care.

There is a genuine argument that the differential in specialist fees, based on the widespread use of consultation codes, is one of the forces driving docs into specialty care instead of primary care and that changing to payment schedule to give more dollars to primary care may begin to remedy the situation. The study’s author states this argument nicely –

Higher payment for consultation codes, while not adding a significant percentage to the overall Medicare budget, sends a signal that primary care cognitive services are not valued equally with such services provided by other specialties. At a time when we want to encourage new physicians to consider primary care and support current practitioners, this differential sends adissonant message. Furthermore, as patients are increasingly responsible for out-of-pocket payments, it is difficult to explain to them why consultant physicians are paid so much more than their primary care physicians for the same or less time spent with them.

There is however, also a counter-argument that specialists incur additional years and costs of training that should be compensated in some way. It’s a complex issue without a simple answer, and both sides have valid points of view.

I happen to agree that we need to begin to create incentives for docs to enter and stay in primary care. However, the consequences of potentially losing subspeciality care, particularly in underserved areas, must be factored into any sudden major shifts in compensation.

I’ve said before that the good and bad news about healthcare is that the medical profession, in general, will follow the money, and that when financial incentives are aligned with what is right for patients, we all win. In realigning incentives, however, we must avoid using the blame brush to paint subspecialists as the bad guys in a system that has, until now, encouraged their practice by compensating them at higher rates than primary care.
I just want to point out that I called this one when I predicted that the single health care reform item that would come this year would be that primary care would win a bigger piece of the pie at the expense of specialists.

*This blog post was originally published at The Blog that Ate Manhattan*

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One Response to “Consultation Codes: Medicare Sends A Message To Specialists”

  1. No need to examine the the original purpose of the consultation code that closely. Medicare’s motivation to eliminate these codes is quite transparent. Pay physicians less money for doing the same amount of work. There will be more of this to come.

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