October 1998 Bulletin


HCFA plans new E/M guidelines with formulas

The Health Care Financing Administration (HCFA) will develop a new set of documentation guidelines for Evaluation and Management Services to replace the 1995 and 1997 versions now being used by carriers to review claims. While acknowledging the American Medical Association's strong opposition to the use of counting or numerical formulas, HCFA said it has decided that some counting is necessary to assure consistent interpretation of the guidelines by Medicare carriers. A new framework developed earlier this year in conjunction with the medical profession will serve as the starting point for the new set of guidelines. No date has been set for implementation. HCFA said "we are taking time to develop guidelines, test the response and burdens and educate physicians and Medicare carriers on revised requirements. In the meantime, Medicare carriers will continue to use either the 1995 or 1997 guidelines, depending on which is most advantageous for the physician." The AMA said it "strongly regrets HCFA's insistence on retaining some quantitative formulas," but noted HCFA's willingness to minimize the use of the formulas and to take the time to develop and test the guidelines. The AMA said it does not expect any new guidelines to be implemented before late 1999.

Florida physicians union to focus on contract issues

The Board of Directors of the 4,000-member Florida Physicians Association (FPA) has voted to move ahead with plans to form a union. William R. Huseman, FPA deputy executive director, said the union will be called the Florida Physicians Union and will be in operation as soon as the incorporation papers are filed with the state. The next step will be a constitutional convention on Oct. 24. The union is expected to focus on issues such as treatment restrictions and unfair contract termination.

Court upholds Texas law allowing patients to sue health plans

The U.S. District Court Judge Vanessa D. Gilmore in Houston upheld a Texas state law that allows injured patients to sue their health plans for damages. Consumer advocates noted that managed care plans have been largely shielded from liability because of the Employee Retirement Income Security Act (ERISA), which regulates employer-sponsored health plans. Judge Gilmore ruled "…the (state) act addresses the quality of benefits actually provided. ERISA simply says nothing about the quality of benefits received." She said a lawsuit may be brought under the state law challenging the quality of care received, not a benefit determination. The Texas law, the first in the nation, was challenged by Aetna, Inc. The court struck down another provision in the Texas law that allows patients to appeal treatment denials to an independent panel. Aetna is seeking to retain the independent appeals process.

Coalition lobbies Senate on patient protection bill

The Patient Access to Specialty Care Coalition continues to lobby Congress to get the Senate to bring up for debate the Republican-sponsored patient protection bill. The coalition also is working to have the Republican bill amended to make it more responsive to patient needs, such as direct access to a specialist. Efforts to move the bill are hampered by the insistence of Democrats to offer 20 or more amendments to the Republican bill. This would extend the amount of time it will take to debate the bill. It appears there is not sufficient time to debate and vote on a Senate patient protection bill, have it approved in a House-Senate conference committee and sent to the President. The revelations in the Starr report about the President also make it difficult to act on a patient protection bill. The patient protection bill most likely will be carried over into next year. (This item was written before the Senate adjourned; it was not known whether the Senate approved health care legislation.)

E/M payments for orthopaedic services down 1.5%

The Medicare Payment Advisory Commission reported Medicare fee schedule payments for specialties that get large shares of Medicare revenues from Evaluation and Management services had increases in payments in 1996-1997, while surgical services had declines. Trends characteristics of the transition to fee schedule payments generally continued in 1997, according to the report by commission. A review of broad categories found that payment rates for E/M services for primary care services increased 5.4 percent a year from 1991 to 1996, while payment rates for surgical services decreased annually by an average of 1.7 percent.

Changes in Medicare fee schedule payments for E/M services

Family/general practice3.7%
Internal Medicine2.8
Gastroenterology -1.8
General surgery -0.8
Orthopaedic surgery-1.5
Thoracic surgery-2.1

Source: Medicare Payment Advisory Commission

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