Medicare reimbursement codes: Hopes are high for keeping CPT

An advisory committee appears ready to recommend changing to the ICD-10 coding system for inpatient settings only.

By Markian Hawryluk, amednews staff. Oct. 20, 2003.

Washington -- Physicians generally don't like to be overlooked. But when it comes to replacing their Medicare coding system, physicians won't complain if they get passed by.

Fortunately, the chances that physicians will have to abandon the 8,000-code Current Procedural Terminology system used by most public and private health care payers for a new 170,000-code system are becoming increasingly remote as a federal advisory committee prepares to make its recommendations on the issue.

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At the September meeting of the National Committee on Vital and Health Statistics, discussions on moving to the new coding system -- the International Classification of Diseases, 10th revision -- focused exclusively on inpatient hospital settings. This left physician groups cautiously optimistic that they have avoided a costly and complicated mandate.

"The physician community is united in its concern that application of the ICD code set in all settings, and not just as currently used, would create chaos and a dramatic increase in administrative hassles associated with coding for physicians," said Edward L. Langston, MD, an American Medical Association trustee.

While the NCVHS has yet to finalize its recommendations to the Dept. of Health and Human Services, physician groups and coding experts say it is unlikely the panel will support replacing the codes now used by physicians.

"I don't think there's any intention or desire to replace CPT at all," said Sue Prophet-Bowman, director of coding policy and compliance for the American Health Information Management Assn.

CPT has 8,000 codes; the ICD-10 coding system has 170,000.

Hospitals and coders have complained for the past several years that the ICD-9 system, used to code inpatient diagnoses and procedures, is outdated and cannot accommodate advances in medical techniques and technology.

The Centers for Medicare & Medicaid Services had planned to implement the ICD-10 diagnosis codes in 2001 prior to the passage of the Health Insurance Portability and Accountability Act. Under HIPAA, however, coding standards can be changed only through a specified process that includes an NCVHS recommendation. After a number of hearings this year, the committee's standards and security subcommittee is expected to weigh in at its October meeting. The full panel could then vote in November on a recommendation to move forward with ICD-10.

Frustrated with the slow pace of deliberations, ICD-10 proponents lobbied lawmakers to include as part of Medicare reform legislation instructions to implement ICD-10 in all settings, including physician offices, if NCVHS did not make a recommendation within a year after enactment of the bill.

The provision was included in the Medicare reform bill in the House but not in the Senate. Lawmakers from both chambers are now working to reconcile differences between the bills, including the ICD-10 mandate. A recommendation from the committee, however, would render the legislative provision moot.

Trying to avoid a bad fit

Physician organizations have lobbied Congress, the Bush administration and the committee to prevent a move to ICD-10 codes in physician practices. Such a change would result in massive upheaval in claims processing for physicians and others, the AMA's Dr. Langston said.

"Many physicians' services are not even included in ICD-10, and this system uses language that is confusing and inconsistent with the language generally used by physicians," he said.

The AMA developed the CPT codes in 1966, and in an agreement with the Association, the government in 1983 adopted the codes for reporting physician services in Medicare. The AMA generates significant income from the licensing of the CPT codes.

In a letter to NCVHS opposing replacing CPT codes, a group of more than 50 medical specialty societies said the ICD-10 procedure codes were never designed to describe physician services.

"There are not provisions for coding evaluation and management services, the most frequently billed physician service," the groups said. "Additionally, there are no codes for anesthesia, psychiatry, home health services, pulmonary services, allergy or immunology services."

A transition to ICD-10 is expected to be a costly endeavor, which some have compared to Y2K or HIPAA preparedness efforts. An NCVHS-commissioned study by RAND, an independent research group, estimated that the cost of implementing ICD-10 in hospital settings would range from $425 million to $1.5 billion. However, the report indicated, the potential benefits would far outweigh the costs.

Supporters of the change believe focusing on implementation costs alone ignores the potential benefits -- lower costs over the long term, improved efficiency and increased quality of care -- that better codes can provide hospitals and other organizations.

"There's been this overemphasis on the cost, which obviously is not insignificant, without much discussion on the greater specificity and detail," Prophet-Bowman said. "It would provide better information about the diagnoses and treatments that their patient population is getting, which could be used for decision support, resource utilization analysis or outcome studies."

An NCVHS decision is not binding, but HHS is expected to accept a recommendation to implement ICD-10. That would require the department first to issue a proposed rule, consider comments and publish a final rule. Industry representatives have pushed for a minimum two-year implementation period for a new coding system. That means under the best-case scenario, hospitals wouldn't shift to the new system before 2006.