2014 Coding Changes Bring Cuts and System Re-Design

Changes to the coding system in 2014 will bring extensive shifts in how you capture charges and code for your services, industry experts said. There are a few bright spots for the next 12 months, but overall, this next year will likely push you to tighten your belt.

The biggest change - implementation of the new ICD-10 coding system - won’t go into effect until Oct. 1, but experts expect it to dominate coding conversations throughout the year.

“To me, 2014 is all about ICD-10,” said Melody Mulaik, president of CSI Coding Strategies. “It will dwarf everything else.”

What ICD-10 will bring

Once in place, ICD-10 will expand the current 14,000-code ICD-9 system to 69,000 codes, requiring providers and referring physicians to be more specific with their diagnoses and documentation. While there won’t be any changes to existing coding groups, your coding processes will be different.

Codes up to seven digits long will replace the current three-to-five digit ICD-9 codes, and a dummy place holder has also been added to allow for further expansion in the future. This change has caused concern within the American College of Radiology (ACR) because current coding systems weren’t designed to accept longer codes. Consequently, practices and facilities are facing updates or upgrades to their existing systems.

Unfortunately, ICD-10 will also put radiologists at the mercy of referring physicians. Most reimbursement for imaging services requires proof of medical necessity - something that must be documented by the referring doctor.

“There is a differentiator [between radiology] and other specialties. Physicians will code or they have a coder looking at their documentation,” Mulaik said. “But because radiologists are so reliant on the hospital or other systems for information, problems can easily arise if a radiologist doesn’t receive enough documentation from the referring physician.”

Most radiologists will struggle with ICD-10, however, because they haven’t taken the time to adequately prepare for it, she said. There is still time, though, to ready yourself for the transition if you start now. Mulaik recommended you take advantage of the ICD-10 Tool Kit from the Radiology Business Management Association that offers guidance for both providers and coders about how to best handle this transition.

Upcoming payment cuts                        

There are plenty of coding changes to worry about before October, though. In the final rule, CMS mandated cuts to breast biopsy codes, as well as various CT and MRI studies. The most substantial reduction affects the breast imaging codes. According to ACR analysis, you can anticipate anywhere between a 29 percent and 50 percent reduction for these codes, mostly as a result of bundling.

“These are significant because anything with the breast is always significant,” said Kathryn Keysor, ACR’s director of economics and health policy.

Specifically, six new codes - 19081 to 19086 - bundle breast biopsy with imaging guidance for stereotactic, ultrasound, or MRI studies. Eight additional new codes - 19281 to 19288 - bundle marker placement with imaging guidance for stereotactic, ultrasound, mammographic, or MRI studies. This last set of codes will actually bring a 17 percent increase in payment for 2014.

You will also see a dip in payment for the CT and MRI procedures you provide, specifically with MRI brain, MRI spine, and CT head. CMS will now require separate cost centers for CT and MRI services to provide more clarity on how to allocate the costs associated with each service. The average reduction for these code changes falls between 30 percent and 40 percent, Keysor said.

CMS also determined that ultrasound guidance for needle placement code 76942 has been misvalued. To date, the time and payment allotted for the guidance was more than the time and amount tied to the procedure itself. Consequently, CMS has mandated a roughly 77 percent cut to the ultrasound guidance code.

The “good” news

The final rule also offers some good news this year, but it comes mostly in the form of postponed changes. In a break from the past few years, CMS opted not to implement any further multiple procedure payment reductions (MPPR). The cuts have applied to imaging services rendered by the same physician to the same patient during the same encounter.

“It’s very positive that CMS didn’t expand the MPPR policy this year,” Keysor said. “It’s due in large part to the education ACR has done this year in showing CMS how this policy affects radiology.”

However, CMS did leave the door open to introducing more MPPR cuts in the future to continue increasing efficiencies.

In addition, talk of putting comprehensive APC codes in place has been pushed to 2015, Mulaik said. With this change, ambulatory surgical center payments would mimic DRG payments for inpatient stays - facilities would receive a fixed pot of reimbursement dollars to be divvied up among all providers involved in a patient’s care.

This will likely be a problem for radiology, she said, because imaging codes will be bundled in with all other services. In many cases, imaging codes will be coded outside the provider’s department, making charge capture even more difficult.

How can you prepare?

The actual economic impact on your practice will depend on how many of the affected services you provide. So, it isn’t possible to craft specific advice on how you can minimize the financial pinch you will feel, Mulaik said.

But there is one way that most practices can try to recoup the lost reimbursement, Keysor said.

“Members should make sure they negotiate with private payers that aren’t tied to the fee schedule each year,” she said. “They can have contracts based on the 2008 fee schedule - or one from another year - rather than the current year. There is wiggle room to negotiate with many private payers.”

It’s important to remember, she said, that the reimbursement cuts that come with the coding changes apply only to Medicare billing. Should you choose to discuss reimbursement levels with your private payers, the ACR has contract evaluation guidelines available to walk you through a successful negotiation.