Practice Management Articles
The Facts About Consultations"What You Need To Know"
Sean M. Weiss
With consultations continuing to be investigated by the Office of Inspector General (OIG), it's time once again to take a look at the process and understanding for what a consultation is, how to code for one, and receive proper reimbursement.
According to an OIG report released in March of 2006, Medicare allowed $3.3 billion for consultations in 2001. The Current Procedural Terminology (CPT) defines a consultation as "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 other appropriate source."
A consultation differs from similar evaluation and management services in that a consultation involves a specific request for help with a particular diagnosis or course of treatment on a limited basis, while an office or inpatient visit lacks such a request and can involve ongoing care of a patient. The CPT defines four types of consultation: (1) office or other outpatient, (2) initial inpatient, (3) follow-up inpatient (removed for 2007), and (4) confirmatory (also called a second opinion, Please note these have been removed from the CPT manual for 2007).
Within each type, three or five levels of complexity exist, with a distinct billing code for each level. The level depends on three key components: (1) the extent of the patient history taken, (2) the thoroughness of the physical examination, and (3) the complexity of the consultant's medical decision making.
Pursuant to 42 CFR § 411.351 and section 15506 of the Medicare Carriers Manual, Medicare allows reimbursement for consultations if (1) a physician requests the consultation, (2) the request and need for the consultation are documented in the patient's medical record, and (3) the consultant furnishes a written report to the referring physician. Other provisions of Federal law require that physicians document all Medicare services and bill them with the correct code.
Medicare allowed approximately $1.1 billion more in 2001 than it should have for services that were billed as consultations. Approximately 75 percent of services billed as consultations and allowed by Medicare in 2001 did not meet all applicable program requirements, resulting in $1.1 billion in improper payments. Services billed as consultations often did not meet Medicare's definition of a consultation (19 percent - $191 million), were billed as the wrong type or level of consultation (47 percent-$613 million), or were not substantiated by documentation (9 percent-$260 million).
Consultations billed at the highest billing level (the most complex services, which generate the highest reimbursements under the physician fee schedule) and follow-up inpatient consultations were particularly problematic; approximately 95 percent of each was miscoded. Based on these findings it is highly likely the carriers are going to begin the performance of audits for more recent years. Do not be surprised if payments for consultations you are billing for start to be denied pending proper documentation to substantiate the services claimed.
Providers must take proactive steps in protecting themselves prior to an audit being performed by your carrier(s). I tell all of my clients as well as groups that I lecture for "The best defense is a strong offense." Solicit the assistance of an expert trained in Evaluation and Management Services as well as CMS audits and methodologies.
Knowing in advance can allow you to correct the problem(s) prior to a carrier audit. Don't think it won't or can't happen to your practice. No one is immune!
For more information on the OIG Audit Results and the CMS letter from Mr. Mark B. McClellan, MD, PhD. to Daniel R. Levinson/ Inspector General, or to find out how The CMC Group, LLC can provide your group with audit and consulting services please contact Sean M. Weiss at email@example.com or (888) 262-8354 ext. 402.