Viewpoint: The end of E&M-based payment

May 22, 2009

Replace the E&M documentation-based payment system with a system that rewards service and value, results in sparser and more useful documentation, and eliminates unnecessary complexity and burden.

These suggestions misread the "perfect storm" of events and incentives, and ignore a far simpler and more obvious solution: Replace the E&M documentation-based payment system with a system that rewards service and value, results in sparser and more useful documentation, and eliminates unnecessary complexity and burden.

For those who were not in practice prior to 1995, it may come as a shock to learn that U.S. physicians were not always paid on the basis of documentation volume. For many decades, physicians were paid for services rendered, with the visit/consult level self-attested and independent of the amount of documentation. For example, documentation of a level-2 visit could be more extensive than a level-4 visit, and documentation of a complex visit could be brief and appropriately focused only on what was relevant.

EHRs and paper forms containing checkbox templates make E&M compliance easier for clinicians to follow and coders to audit. This is not the fault of EHRs or paper forms developers; this is their response to the demand created by the E&M documentation-based payment system.

While again popular among practicing physicians, the call to replace the E&M payment system is not new. In 2002, the Department of Health and Human Services convened a committee that concluded almost unanimously that the E&M system should be scrapped. Among its conclusions: The E&M system was not a fairer way of judging physician effort than the previous self-attestation method, it failed to add any new value, and it added an unreasonable burden to an already overburdened healthcare system. However, the report did not address the total cost of this payment schema change.

Another little-known fact: The Medicare Modernization Act of 2003 recommended to the Secretary of HHS that pilots of alternate payment systems be conducted. Unfortunately, this never happened.

As if adding cost and complexity without value weren't bad enough, the E&M payment system also led to serious damage for more than a decade to the nascent EHR industry. Beginning in the late 1990s, in response to market demand and physician fear of failing coding audits, virtually every EHR vendor developed coding-support software. The result: Almost every EHR on the market today has some type of coding support (albeit imperfect), and almost none have decision support for quality, efficacy, and/or efficiency.

If the Obama stimulus package is effective in accelerating adoption of health information technology, we will be asking a lot of our doctors. We will also be asking our healthcare providers to use their newly acquired HIT in meaningful ways, which will likely include an increased focus on reducing unnecessary costs and improving quality and safety. Isn't this the time, as we add difficulty to medical practice, to also remove a burden that is without value?

This is the right time for the Centers for Medicare & Medicaid Services to reissue its call for pilots of payment and documentation schema without E&M coding requirements. This is the right time for physicians to reject the shameful organizing metaphor of E&M coding-"it's not what you do, it's what you document"-and replace it with a renewed focus on what our patients deserve: better healthcare.

Peter Basch, MD, FACP, is a medical director for MedStar Health in Columbia, Maryland. Send your feedback to meletters@advanstar.com
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