A.        Refinement of Work Relative Value Units.

            Since the physician fee schedule is first established in 1992, it has been composed of three categories of relative value units, i.e., work, malpractice expense, and overhead. Each of these units is assigned a value and the sum of those units is multiplied by the dollar conversion factor to establish the Medicare reimbursement for each particular CPT code. The system includes a process for refining the work relative value units, i.e., a re-evaluation of the value of the work units assigned to each CPT code. CMS uses a standard five year review cycle based upon input by the AMA/Specialty Society Relative Scale Update Committee (RUC). For 2008, CMS has revised the work units for comprehensive hearing tests (92557), visual audiometry (92579), doppler color flow (93325), and 14 home visit codes (99336 through 99350). The values, which are contained in Table 14 of the proposed physician fee schedule, is attached below at the link entitled Table 14: Work RVU Revisions.

www.medlawblog.com/Table 14 Work RVU Revisions(1).pdf

B.         Anesthesia Coding.

            Anesthesia codes do not have a work RVU per code as do other medical and surgical services; they are paid on the basis of an anesthesia code specific base unit and time units that are based upon the actual anesthesia time of the case. Since anesthesia services do not have a work RVU, a work value must be imputed for each anesthesia code. The imputed value is determined by multiplying the national average allowed charge for each anesthesia services by its anesthesia work share and dividing this amount by the general conversion factor. In the second five year review of anesthesia work implemented in 2002, the AMA-RUC and the American Society of Anesthesiologists (ASA) used what they refer to as a “building block approach” to estimate the value of anesthesia work and compared this value to the imputed work value to determine whether the work of anesthesia services were being properly valued. Under the building block approach, each anesthesia code was uniformly divided into five components, i.e., pre-anesthesia, equipment and supply preparation, induction, post-induction anesthesia, and post-anesthesia. Work values were imputed to each component. The most significant component was determined to be the work for post-induction anesthesia. During the previous five year review, the 19 highest volume anesthesia codes were reviewed and only modest adjustments were made by linking pre- and post-anesthesia service components to evaluation and management services. Even the changes that were made to the 19 high volume procedures were not incorporated into the work units or value of the remaining anesthesia codes.

          The recent re-evaluation of this issue resulted in a recommendation by CMS for a 32% increase in the value for the work units for anesthesia services.

C.        New and Revised CPT Codes.

            The link below to Table 16 of the proposed fee schedule is the AMA-RUC and HCPAC recommendations and CMS decisions for new and revised 2008 CPT codes. Table 17 is the AMA-RUC anesthesia recommendations and CMS decision for new and revised/reviewed anesthesia CPT codes.

www.medlawblog.com/Table 16 New & Revised CPT Codes for 2008(1).pdf

D.        Cardiac MRI Codes.

            As a result of technological changes in MRI scanning, the CPT editorial panel has created eight new cardiac MRI codes and deleted five existing cardiac MRI codes. The new codes and the deleted codes are contained in the link below identified as cardiac MRI codes.

www.medlawblog.com/Cardiac MRI Codes(1).pdf

E.         Physician Self-Referral DHS Update.

            CMS also both added and deleted services from the list of Designated Health Services for purposes of the Stark self referral prohibition. The expanded list includes the new cardiac MRI codes and twenty radiation therapy service and supply codes. The only deletions were the cardiac MRI codes which were deleted as CPT codes. The additions and deletions are in Tables 19 and 20 of the proposed Medicare Physician Fee Schedule, both of which are attached as links.

www.medlawblog.com/Table 19 Physician Self Referredd DHS Codes(1).pdf