You are on page 1of 50


November 1, 2000

Part II

Department of
Health and Human
Health Care Financing Administration

42 CFR Parts 410 and 414
Medicare Program; Revisions to Payment
Policies Under the Physician Fee
Schedule for Calendar Year 2001; Final

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00001 Fmt 4717 Sfmt 4717 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
65376 Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations

DEPARTMENT OF HEALTH AND DATES: Effective date: This rule is Marc Hartstein, (410) 786–4539 (for
HUMAN SERVICES effective January 1, 2001. issues related to the physician fee
Comment date: Comments on interim schedule update, the sustainable growth
Health Care Financing Administration RVUs for selected procedure codes rate, the conversion factor, and the
identified in Addendum C and on regulatory impact analysis).
42 CFR Parts 410 and 414 interim practice expense RVUs and Diane Milstead, (410) 786–3355 (for
malpractice RVUs for all codes as all other issues).
[HCFA–1120–FC] shown in Addendum B will be SUPPLEMENTARY INFORMATION:
considered if we receive them at the Copies: To order copies of the Federal
RIN 0938–AK11 appropriate address, as provided below, Register containing this document, send
no later than 5 p.m. on January 2, 2001. your request to: New Orders,
Medicare Program; Revisions to
ADDRESSES: Mail written comments (1 Superintendent of Documents, P.O. Box
Payment Policies Under the Physician
original and 3 copies) to the following 371954, Pittsburgh, PA 15250–7954.
Fee Schedule for Calendar Year 2001
address only: Health Care Financing Specify the date of the issue requested
AGENCY: Health Care Financing Administration, Department of Health and enclose a check or money order
Administration (HCFA), HHS. and Human Services, Attention: HCFA– payable to the Superintendent of
ACTION: Final rule with comment period. 1120–FC, P.O. Box 8013, Baltimore, MD Documents, or enclose your Visa,
21244–8013. Discover, or Master Card number and
SUMMARY: This final rule with comment Please allow sufficient time for mailed expiration date. Credit card orders can
period makes several changes affecting comments to be timely received in the also be placed by calling the order desk
Medicare Part B payment. The changes event of delivery delays. If you prefer, at (202) 512–1800 or by faxing to (202)
include: refinement of resource-based you may deliver your written comments 512–2250. The cost for each copy is $8.
practice expense relative value units by courier (1 original and 3 copies) to As an alternative, you can view and
(RVUs); the geographic practice cost one of the following addresses: photocopy the Federal Register
indices; resource-based malpractice Room 443–G, Hubert H. Humphrey document at most libraries designated
RVUs; critical care RVUs; care plan Building, 200 Independence Avenue, as Federal Depository Libraries and at
oversight and physician certification SW., Washington, DC 20201 or Room many other public and academic
and recertification for home health C5–14–03, 7500 Security Boulevard, libraries throughout the country that
services; observation care codes; ocular Baltimore, MD 21244. receive the Federal Register.
photodynamic therapy and other Comments mailed to the two above To order the disks containing this
ophthalmological treatments; electrical addresses may be delayed and received document, send your request to:
bioimpedance; antigen supply; and the too late to be considered. Because of Superintendent of Documents,
implantation of ventricular assist staff and resource limitations, we cannot Attention: Electronic Products, P.O. Box
devices. This rule also addresses the accept comments by facsimile (FAX) 37082, Washington, DC 20013–7082.
comments received on the May 3, 2000 transmission. In commenting, please Please specify, ‘‘Medicare Program;
interim final rule on the supplemental refer to file code HCFA–1120–FC. Revisions to Payment Policies Under the
survey criteria and makes modifications Comments received timely will be Physician Fee Schedule for Calendar
to the criteria for data submitted in available for public inspection as they Year 2001,’’ and enclose a check or
2001. Based on public comments we are are received, generally beginning money order payable to the
withdrawing our proposals related to approximately 3 weeks after publication Superintendent of Documents, or
the global period for insertion, removal, of a document, in Room 443–G of the enclose your VISA, Discover, or
and replacement of pacemakers and Department’s office at 200 MasterCard number and expiration date.
cardioverter defibrillators and low Independence Avenue, SW., Credit card orders can be placed by
intensity ultrasound. This final rule also Washington, DC, on Monday through calling the order clerk at (202) 512–1530
discusses or clarifies the payment policy Friday of each week from 8:30 to 5 p.m. (or toll free at 1–888–293–6498) or by
for incomplete medical direction, pulse (phone: (202) 690–7890). faxing to (202) 512–1262. The cost of the
oximetry services, outpatient therapy FOR FURTHER INFORMATION CONTACT: four disks is $25.
supervision, outpatient therapy caps, Carolyn Mullen, (410) 786–4589 or Marc This Federal Register document is
HCPCS ‘‘G’’ Codes, and the second 5- Hartstein, (410) 786–4539, (for issues also available from the Federal Register
year refinement of work RVUs for related to resource-based practice online database through GPO Access, a
services furnished beginning January 1, expense relative value units). service of the U.S. Government Printing
2002. In addition, we are finalizing the Kenneth Marsalek, (410) 786–4502 Office. The Website address is: http://
calendar year (CY) 2000 interim (for issues related to supplemental
physician work RVUs and are issuing practice expense survey data). Information on the physician fee
interim RVUs for new and revised codes Bob Ulikowski, (410) 786–5721 (for schedule can be found on our
for CY 2001. We are making these issues related to resource-based homepage. You can access this data by
changes to ensure that our payment malpractice relative value units and using the following directions:
systems are updated to reflect changes geographic practice cost index changes). 1. Go to the HCFA homepage (http:/
in medical practice and the relative Rick Ensor, (410) 786–5617 (for issues /
value of services. This final rule also related to care plan oversight and 2. Click on ‘‘Medicare.’’
announces the CY 2001 Medicare physician certification/recertification). 3. Click on ‘‘Professional/Technical
physician fee schedule conversion Cathleen Scally, (410) 786–5714 (for Information.’’
factor under the Medicare issues related to observation care codes). 4. Select Medicare Payment Systems.
Supplementary Medical Insurance (Part Jim Menas, (410) 786–4507 (for issues 5. Select Physician Fee Schedule.
B) program as required by section related to incomplete medical direction Or, you can go directly to the Physician
1848(d) of the Social Security Act. The and the 5-year review). Fee Schedule page by typing the
2001 Medicare physician fee schedule Roberta Epps, (410) 786–4503 (for following:
conversion factor is $38.2581. issues related to outpatient/therapy). medicare/pfsmain.htm.

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00002 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations 65377

To assist readers in referencing F. Sustainable Growth Rate for FY 2000 MCM Medicare Carrier Manual
sections contained in this preamble, we G. Calculation of the FY 2000, CY 2000, MedPAC Medicare Payment Advisory
are providing the following table of and CY 2001 Sustainable Growth Rates Commission
VII. Provisions of the Final Rule MEI Medicare Economic Index
contents. Some of the issues discussed
VIII. Collection of Information Requirements MGMA Medical Group Management
in this preamble affect the payment IX. Response to Comments Association
policies but do not require changes to X. Regulatory Impact Analysis MSA Metropolitan Statistical Area
the regulations in the Code of Federal A. Resource-Based Practice Expense NAMCS National Ambulatory Medical Care
Regulations. Information on the Relative Value Units Survey
regulations impact appears throughout B. Geographic Practice Cost Index Changes OBRA Omnibus Budget Reconciliation Act
the preamble and is not exclusively in C. Resource-Based Malpractice Relative PC Professional component
section X. Value Units PEAC Practice Expense Advisory
D. Critical Care Relative Value Units Committee
Table of Contents E. Care Plan Oversight and Physician PPAC Practicing Physicians Advisory
I. Background Certification/Recertification Council
A. Legislative History F. Observation Care Codes PPS Prospective payment system
B. Published Changes to the Fee Schedule G. Ocular Photodynamic Therapy and RUC [AMA’s Specialty Society] Relative
C. Components of the Fee Schedule Other Ophthalmological Treatments [Value] Update Committee
Payment Amounts H. Electrical Bioimpedance RVU Relative value unit
D. Development of the Relative Value Units I. Global Period for Insertion, Removal, and SGR Sustainable growth rate
II. Specific Proposals for Calendar Year 2001 Replacement of Pacemakers and SMS [AMA’s] Socioeconomic Monitoring
A. Resource-Based Practice Expense Cardioverter Defibrillators System
Relative Value Units J. Antigen Supply TC Technical component
B. Geographic Practice Cost Index Changes K. Increased Space Allotment in Physical
C. Resource-Based Malpractice Relative Therapy Salary Equivalency Guidelines I. Background
Value Units XI. Federalism
Addendum A—Explanation and Use of A. Legislative History
D. Critical Care Relative Value Units
E. Care Plan Oversight and Physician Addendum B Since January 1, 1992, Medicare has
Certification/Recertification Addendum B—2001 Relative Value Units paid for physicians’ services under
F. Observation Care Codes and Related Information Used in
Determining Medicare Payments for
section 1848 of the Social Security Act
G. Ocular Photodynamic Therapy and (the Act), ‘‘Payment for Physicians’
Other Ophthalmological Treatments 2001
H. Electrical Bioimpedance Addendum C—Codes with Interim RVUs Services.’’ This section contains three
I. Global Period for Insertion, Removal, and Addendum D—2002 Geographic Practice major elements—(1) a fee schedule for
Replacement of Pacemakers and Cost Indices by Medicare Carrier and the payment of physicians’ services; (2)
Cardioverter Defibrillators Locality a sustainable growth rate for the rates of
J. Antigen Supply Addendum E—2001 Geographic Practice increase in Medicare expenditures for
K. Low Intensity Ultrasound Cost Indices by Medicare Carrier and physicians’ services; and (3) limits on
L. Implantation of Ventricular Assist Locality
Addendum F—Proposed 2002 Versus 1999
the amounts that nonparticipating
Devices physicians can charge beneficiaries. The
III. Other Issues Geographic Adjustment Factors (GAF)
A. Incomplete Medical Direction Addendum G—Malpractice Act requires that payments under the
B. Payment for Pulse Oximetry Services fee schedule be based on national
In addition, because of the many
C. Outpatient Therapy Supervision uniform relative value units (RVUs)
organizations and terms to which we
D. Outpatient Therapy Caps based on the resources used in
refer by acronym in this final rule, we
E. HCPCS G Codes furnishing a service. Section 1848(c) of
are listing these acronyms and their
F. Work RVUs in the Proposed Rule the Act requires that national RVUs be
G. Five-Year Refinement of Relative Value corresponding terms in alphabetical
established for physician work, practice
Units order below:
expense, and malpractice expense.
IV. Refinement of Relative Value Units for AMA American Medical Association Section 1848(c)(2)(B)(ii)(II) of the Act
Calendar Year 2001 and Response to BBA Balanced Budget Act of 1997
Public Comments on Interim Relative provides that adjustments in RVUs may
BBRA Balanced Budget Refinement Act of
Value Units for 2000 (Including the 1999
not cause total physician fee schedule
Interim Relative Value Units Contained CF Conversion factor payments to differ by more than $20
in the July 2000 Proposed Rule) CFR Code of Federal Regulations million from what they would have
A. Summary of Issues Discussed Related to CPT [Physicians’] Current Procedural been had the adjustments not been
the Adjustment of Relative Value Units Terminology made. If adjustments to RVUs cause
B. Process for Establishing Work Relative [4th Edition, 1997, copyrighted by the expenditures to change by more than
Value Units for the 2001 Physician Fee American Medical Association] $20 million, we must make adjustments
Schedule and Clarification of CPT CPEP Clinical Practice Expert Panel to the conversion factors (CFs) to
Definitions CRNA Certified Registered Nurse
C. Other Changes to the 2001 Physician Fee Anesthetist
preserve budget neutrality.
Schedule and Clarification of CPT E/M Evaluation and management B. Published Changes to the Fee
Definitions EB Electrical bioimpedance Schedule
V. Physician Fee Schedule Update and FMR Fair market rental
Conversion Factor for Calendar Year GAF Geographic adjustment factor In the July 2000 proposed rule (65 FR
2001 GPCI Geographic practice cost index 44177), we listed all of the final rules
VI. Allowed Expenditures for Physicians’ HCFA Health Care Financing published through November 1999,
Services and the Sustainable Growth Administration relating to the updates to the RVUs and
Rate HCPCS HCFA Common Procedure Coding revisions to payment policies under the
A. Medicare Sustainable Growth Rate System
B. Physicians’ Services HHA Home health agency
physician fee schedule. In the July 2000
C. Provisions Related to the SGR HHS [Department of] Health and Human proposed rule (65 FR 44176), we
D. Preliminary Estimate of the SGR for Services discussed several issues affecting
2001 IDTFs Independent Diagnostic Testing Medicare payment for physicians’
E. Sustainable Growth Rate for CY 2000 Facilities services, including:

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00003 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
65378 Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations

Refinement of resource-based practice Payment = [(RVU work × GPCI work) + to be phased in over 4 years, effective
expense RVUs; (RVU practice expense × GPCI for services furnished in 1999, with
• Changes to the geographic practice practice expense) + (RVU malpractice resource-based practice expense RVUs
cost indices; × GPCI malpractice)] × CF becoming fully effective in 2002. The
• Resource-based malpractice RVUs; The CF for CY 2001 appears in section BBA also requires us to implement
• Critical care RVUs; V. The RVUs for CY 2001 are in resource-based malpractice RVUs for
• Care plan oversight and physician Addendum B. The GPCIs for CY 2001 services furnished beginning in 2000.
certification/recertification; can be found in Addendum E.
• Observation care codes; II. Specific Proposals for Calendar Year
Section 1848(e) of the Act requires us 2001
• Ocular photodynamic therapy and to develop GAFs for all physician fee
other ophthalmological treatments; schedule areas. The total GAF for a fee In response to the publication of the
• Electrical bioimpedance; schedule area is equal to a weighted July 2000 proposed rule, we received
• The global period for insertion, average of the individual GPCIs for each approximately 600 comments. We
removal, and replacement of of the three components of the service. received comments from individual
pacemakers and cardioverter Thus, the GPCIs reflect the relative physicians, health care workers, and
defibrillators; practice expenses, malpractice professional associations and societies.
• Antigen supply;
insurance, and physician work in an The majority of comments addressed the
• Low intensity ultrasound; and
area compared to the national average. proposals related to practice expense,
• The implantation of ventricular
In accordance with the statute, however, observation care, antigen supplies, care
assist devices.
This proposed rule also discussed or the GAF for the physician’s work plan oversight, and certification and
clarified the payment policy for reflects one-quarter of the relative cost recertification of home health services.
incomplete medical direction, pulse of physician’s work compared to the The proposed rule discussed policies
oximetry services, outpatient therapy national average. that affected the number of RVUs on
supervision, outpatient therapy caps, D. Development of the Relative Value which payment for certain services
and the second 5-year refinement of Units would be based. Certain changes
work RVUs for services furnished implemented through this final rule are
beginning January 1, 2002. 1. Work Relative Value Units subject to the $20 million limitation on
This final rule affects the regulations Approximately 7,500 codes represent annual adjustments contained in section
set forth at part 410, Supplementary services included in the physician fee 1848(c)(2)(B)(ii)(II) of the Act.
medical insurance (SMI) benefits and schedule. The work RVUs established After reviewing the comments and
part 414, Payment for Part B medical for the implementation of the fee determining the policies we would
and other services. schedule in January 1992 were implement, we have estimated the costs
The information in this final rule developed with extensive input from and savings of these policies, and added
updates information in the July 2000 the physician community. A research those costs and savings to the estimated
proposed rule and the May 3, 2000 team at the Harvard School of Public costs associated with any other changes
interim final rule with comment period Health developed the original work in RVUs for 2001. We discuss in detail
(65 FR 25664) discussed later. RVUs for most codes in a cooperative the effects of these changes in the
agreement with us. In constructing the Regulatory Impact Analysis (section X).
C. Components of the Fee Schedule
vignettes for the original RVUs, Harvard For the convenience of the reader, the
Payment Amounts
worked with panels of expert physicians headings for the policy issues
Under the formula set forth in section and obtained input from physicians correspond to the headings used in the
1848(b)(1) of the Act, the payment from numerous specialties. July 2000 proposed rule. More detailed
amount for each service paid under the The RVUs for radiology services were background information for each issue
physician fee schedule is the product of based on the American College of can be found in the May 2000 interim
three factors—(1) a nationally uniform Radiology (ACR) relative value scale, final rule with comment period and the
relative value for the service; (2) a which we integrated into the overall July 2000 proposed rule.
geographic adjustment factor (GAF) for physician fee schedule. The RVUs for
each physician fee schedule area; and anesthesia services were based on RVUs A. Resource-Based Practice Expense
(3) a nationally uniform CF for the from a uniform relative value guide. We Relative Value Units
service. The CF converts the relative established a separate CF for anesthesia 1. Resource-Based Practice Expense
values into payment amounts. services while we continue to recognize Legislation
For each physician fee schedule time as a factor in determining payment
service, there are three relative values— for these services. As a result, there is Section 121 of the Social Security Act
(1) an RVU for physician work; (2) an a separate payment system for Amendments of 1994 (Pub. L. No. 103–
RVU for practice expense; and (3) an anesthesia services. 432), enacted on October 31, 1994,
RVU for malpractice expense. For each required us to develop a methodology
of these components of the fee schedule 2. Practice Expense and Malpractice for a resource-based system for
there is a geographic practice cost index Expense Relative Value Units determining practice expense RVUs for
(GPCI) for each fee schedule area. The Section 121 of the Social Security Act each physician’s services beginning in
GPCIs reflect the relative costs of Amendments of 1994 (Pub. L. No. 103– 1998. In developing the methodology,
practice expenses, malpractice 432), enacted on October 31, 1994, we were to consider the staff,
insurance, and physician work in an required us to develop a methodology equipment, and supplies used in
area compared to the national average for a resource-based system for furnishing medical and surgical services
for each component. determining practice expense RVUs for in various settings. The legislation
The general formula for calculating each physician service. As amended by specifically required that, in
the Medicare fee schedule amount for a the Balanced Budget Act of 1997 (BBA) implementing the new system of
given service in a given fee schedule (Pub. L. No. 105–33), section 1848(c) practice expense RVUs, we must apply
area can be expressed as: required the new payment methodology the same budget-neutrality provisions

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00004 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations 65379

that we apply to other adjustments (CPEP) data and the AMA’s (i) Direct Costs
under the physician fee schedule. Socioeconomic Monitoring System For direct costs (including clinical
Section 4505(a) of the BBA delayed (SMS) data. The methodology is based labor, medical supplies, and medical
the effective date of the resource-based on an assumption that current aggregate equipment), we used the CPEP data as
practice expense RVU system until specialty practice costs are a reasonable the allocation basis. The CPEP data for
January 1, 1999. In addition, section way to establish initial estimates of clinical labor, medical supplies, and
4505(b) of the BBA provided for a 4-year relative resource costs of physicians’ medical equipment were used to
transition period from charge-based services across specialties. It then allocate the clinical labor, medical
practice expense RVUs to resource- allocates these aggregate specialty supplies, and medical equipment cost
based RVUs. The practice expense RVUs practice costs to specific procedures pools, respectively.
for CY 1999 were the product of 75 and, thus, can be considered as a ‘‘top- For the separate practice expense pool
percent of charge-based RVUs and 25 down’’ approach. The methodology can for services with work RVUs equal to
percent of the resource-based RVUs. For be summarized as follows: zero, we used 1998 practice expense
CY 2000, the RVUs were 50 percent a. Practice Expense Cost Pools. We RVUs to allocate the direct cost pools
charge-based and 50 percent resource- used actual practice expense data by (clinical labor, medical supplies, and
based. For CY 2001, the RVUs are 25 specialty, derived from the 1995 medical equipment cost pools) as an
percent charge-based and 75 percent through 1997 SMS survey data, to create interim measure. Also, for all radiology
resource-based. After CY 2001, the six cost pools—administrative labor, services that are assigned work RVUs,
RVUs will be totally resource-based. clinical labor, medical supplies, medical we used the 1998 practice expense
Section 4505(e) of the BBA provided equipment, office supplies, and all other relative values for radiology services as
that, in 1998, the practice expense RVUs expenses. There were three steps in the an interim measure to allocate the direct
would be adjusted for certain services in creation of the cost pools. practice expense cost pool for radiology.
anticipation of the implementation of • Step (1) We used the AMA’s SMS For all other specialties that perform
resource-based practice expenses survey of actual cost data to determine radiology services, we used the CPEP
beginning in 1999. As a result, we practice expenses per hour by cost data for radiology services in the
increased practice expense RVUs for category. The practice expenses per allocation of that specialty’s direct
office visits. For other services in which hour for each physician respondent’s practice expense cost pools.
practice expense RVUs exceeded 110 practice was calculated as the practice
percent of the work RVUs and were expenses for the practice divided by the (ii) Indirect Costs
furnished less than 75 percent of the total number of hours spent in patient To allocate the cost pools for indirect
time in an office setting, we reduced the care activities. The practice expenses costs, including administrative labor,
1998 practice expense RVUs to a per hour for the specialty were an office expenses, and all other expenses,
number equal to 110 percent of the work average of the practice expenses per we used the total direct costs, as
RVUs. This limitation did not apply to hour for the respondent physicians in described above, in combination with
services that had proposed resource- that specialty. In addition, for the CY the physician fee schedule work RVUs.
based practice expense RVUs that 2000 physician fee schedule, we used We converted the work RVUs to dollars
increased from their 1997 practice data from a survey submitted by the using the Medicare CF (expressed in
expense RVUs as reflected in the June Society of Thoracic Surgeons (STS) in 1995 dollars for consistency with the
18, 1997 proposed rule (62 FR 33196). calculating thoracic and cardiac SMS survey years).
The services affected, and the final surgery’s practice expense per hour. The SMS pool was divided by the
RVUs for 1998, were published in the (See the November 1999 final rule (64 CPEP pool for each specialty to produce
October 1997 final rule (62 FR 59103). FR 59391) for additional information a scaling factor that was applied to the
The most recent legislation affecting concerning acceptance of this data.) CPEP direct cost inputs. This was
resource-based practice expense was • Step (2) We determined the total intended to match costs counted as
included in the Balanced Budget number of physician hours (by practice expenses in the SMS survey
Refinement Act of 1999 (BBRA) (Pub. L. specialty) spent treating Medicare with items counted as practice expenses
No. 106–113). Section 212 of the BBRA patients. This was calculated from in the CPEP process. When the
stated that we must establish a process physician time data for each procedure specialty-specific scaling factor exceeds
under which we accept and use, to the code and from Medicare claims data. the average scaling factor by more than
maximum extent practicable and • Step (3) We calculated the practice three standard deviations, we used the
consistent with sound data practices, expense pools by specialty and by cost average scaling factor. (See the
data collected or developed by entities category by multiplying the specialty November 1999 final rule (64 FR 59390)
and organizations. These data would practice expenses per hour for each for further discussion of this issue).
supplement the data we normally category by the total physician hours. For procedures performed by more
collect in determining the practice For services with work RVUs equal to than one specialty, the final procedure
expense component of the physician fee zero (including the technical component code allocation was a weighted average
schedule for payments in CY 2001 and (TC) of services with a TC and of allocations for the specialties that
CY 2002. professional component (PC)), we perform the procedure, with the weights
created a separate practice expense being the frequency with which each
2. Current Methodology for Computing pool, using the average clinical staff
Practice Expense Relative Value Unit specialty performs the procedure on
time from the CPEP data (since these Medicare patients.
System codes by definition do not have c. Other Methodological Issues.
Effective with services on or after physician time), and the ‘‘all
January 1, 1999, we established a new physicians’’ practice expense per hour. (i) Global Practice Expense Relative
methodology for computing resource- b. Cost Allocation Methodology. For Value Units
based practice expense RVUs that used each specialty, we separated the six For services with the PC and TC paid
the two significant sources of actual practice expense pools into two groups under the physician fee schedule, the
practice expense data we have available: and used a different allocation basis for global practice expense RVUs were set
the Clinical Practice Expert Panel each group. equal to the sum of the PC and TC.

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00005 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
65380 Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations

(ii) Practice Expenses per Hour (iii) Time Associated with the Work We also discussed a proposal
Adjustments and Specialty Crosswalks RVUs submitted by the AMA’s Specialty
Since many specialties identified in The time data resulting from the Society Relative Value Update
our claims data did not correspond refinement of the work RVUs have been, Committee (RUC) for development of a
exactly to the specialties included in the on average, 25 percent greater than the new advisory committee, the Practice
practice expense tables from the SMS time data obtained by the Harvard study Expense Advisory Committee (PEAC), to
survey data, it was necessary to for the same services. We increased the review comments and recommendations
crosswalk these specialties to the most Harvard research team’s time data to on the code-specific CPEP data during
ensure consistency between these data the refinement period. In addition, we
appropriate SMS specialty category. We
sources. solicited comments and suggestions
also made the following adjustments to
For services with no assigned about our practice expense methodology
the practice expense per hour data. (For
physician time (such as, dialysis, from organizations that have a broad
the rationale for these adjustments to
physical therapy, psychology, and many range of interests and expertise in
the practice expense per hour see the
radiology and other diagnostic services), practice expense and survey issues.
November 1998 final rule (63 FR In the July 22, 1999 proposed rule, the
58841).) we calculated estimated total physician
November 1999 final rule, and the July
• We set the medical materials and time based on work RVUs, maximum
2000 proposed rule, we provided further
supplies practice expenses per hour for clinical staff time for each service as
information on refinement activities
the specialty of ‘‘oncology’’ equal to the shown in the CPEP data, or the
underway, including the
‘‘all physician’’ medical materials and judgment of our clinical staff.
We calculated the time for CPT codes recommendations from the PEAC and
supplies practice expenses per hour. the support contract that we awarded to
• We based the administrative 00100 through 01996, using the base
focus on methodologic issues. The
payroll, office, and other practice and time units from the anesthesia fee
following is an update on activities with
expenses per hour for the specialties of schedule and the Medicare allowed
respect to these initiatives, as well as
‘‘physical therapy’’ and ‘‘occupational claims data.
the status of refinement with respect to
therapy’’ on data used to develop the 3. Refinement other areas of concern such as the SMS
salary equivalency guidelines for these data and CPEP inputs.
specialties. We set the remaining a. Background
practice expense per hour categories Section 4505(d)(1)(C) of the BBA b. SMS Data
equal to the ‘‘all physician’’ practice required us to develop a refinement We have received many comments on
expenses per hour from the SMS survey process to be used during each of the 4 both our 1998 and 1999 proposed and
data. years of the transition period. We did final rules from a number of medical
• Due to uncertainty concerning the not propose a specific long-term specialty societies expressing concerns
appropriate crosswalk and time data for refinement process in the June 1998 regarding the accuracy of the SMS data.
the nonphysician specialty proposed rule (63 FR 30835). Rather, we Some commenters stated their belief
‘‘audiologist,’’ we derived the resource- set out the parameters for an acceptable that the sample size for their specialty
based practice expense RVUs for codes refinement process for practice expense was not large enough to yield reliable
performed by audiologists from the RVUs and solicited comments on our data. Other specialties not represented
practice expenses per hour of the other proposal. We received a large variety of in the SMS survey objected that the
specialties that perform these codes. comments about broad methodology crosswalk used for their practice
• For the specialty of ‘‘emergency issues, practice expense per hour data, expense per hour was not appropriate
medicine,’’ we used the ‘‘all physician’’ and detailed code level data. We made and requested that their own data be
practice expense per hour to create some adjustments to our proposal when used instead. Commenters also raised
practice expense cost pools for the we were convinced an adjustment was questions about whether the direct
categories ‘‘clerical payroll’’ and ‘‘other appropriate. We also indicated that we patient care hours for their specialty
expenses.’’ would consider other comments for were overstated by the SMS to the
• For the specialty of ‘‘podiatry,’’ we possible refinement and that the values specialty’s disadvantage.
used the ‘‘all physician’’ practice of all codes would be considered We consider dealing with these issues
expense per hour to create the practice interim for 1999 and for future years to be one of the major priorities of the
expense pool. during the transition period. refinement effort. Therefore, we have
• For the specialty of ‘‘pathology,’’ we We outlined in the November 1998 undertaken the following activities:
removed the supervision and autopsy final rule (63 FR 58832) the steps we
hours reimbursed through Part A of the (i) Interim Final Rule on Supplemental
were undertaking as part of the initial
Medicare program from the practice Practice Expense Survey Data
refinement process. These steps
expense per hour calculation. included— On May 3, 2000, we published an
• For the specialty ‘‘maxillofacial • Establishment of a mechanism to interim final rule (65 FR 25664) that set
prosthetics,’’ we used the ‘‘all receive independent advice for dealing forth the criteria for physician and non-
physician’’ practice expense per hour to with broad practice expense RVU physician specialty groups to submit
create practice expense cost pools and, technical and methodological issues; supplemental practice expense survey
as an interim measure, allocated these • Evaluation of any additional data for use in determining payments
pools using the 1998 practice expense recommendations from the General under the physician fee schedule.
RVUs. Accounting Office, the Medicare Section 212 of the BBRA amended
• We split the practice expenses per Payment Advisory Commission section 1848(c) of the Act to require us
hour for the specialty ‘‘radiology’’ into (MedPAC), and the Practicing to establish a process under which we
‘‘radiation oncology’’ and ‘‘radiology Physicians Advisory Council (PPAC); will accept and use, to the maximum
other than radiation oncology’’ and used and extent practicable and consistent with
this split practice expense per hour to • Consultation with physician groups sound data practices, data collected or
create practice expense cost pools for and other groups concerning these developed by entities and organizations.
these specialties. issues. These data will supplement the data we

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00006 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations 65381

normally collect in determining the • A group must use a contractor that precision of the practice expenses are
practice expense component of the has experience with the SMS or a equal to or better than this level of
physician fee schedule for payments in survey firm with experience precision and that meet the other survey
CY 2001 and CY 2002. successfully conducting national multi- criteria. Also, we indicated that we will
To obtain data that could be used in specialty surveys of physicians using require documentation regarding how
computing practice expense RVUs nationally representative random the practice expenses were calculated
beginning January 1, 2001, we samples. and we will verify the calculations. We
published the criteria in the May 2000 • A group must submit raw survey have the statutory authority, however, to
interim final rule (65 FR 25666) that we data to us, including all complete and determine the final practice expense
will apply to supplemental survey data incomplete survey responses as well as RVUs.
submitted to us by August 1, 2000. We any cover letters and instructions that We also indicated that, since the
also provided a 60-day period for accompanied the survey, by August 1, physician fee schedule is a national fee
submission of comments on the criteria 2000 for data analysis and editing to schedule, we would require that the
that we will consider for survey data ensure consistency. All personal survey be representative of the target
submitted between August 2, 2000 and identifiers in the raw data must be population of physicians nationwide.
August 1, 2001 for use in computing the eliminated. (Send data to Health Care We can presume national
practice expense RVUs for the CY 2002 Financing Administration, Department representativeness if a random sample is
physician fee schedule. (See the May of Health and Human Services, Attn: drawn from a complete nationwide
2000 interim final rule for further Kenneth Marsalek, C4–03–06, 7500 listing of the physician specialty or
information on the criteria and process). Security Boulevard, Baltimore, MD subspecialty and the response rate, the
We are responding to comments 21244–8013.) percent of usable responses received
received on the interim final rule in this • Raw survey data submitted to us from the sample, is high, for example,
rule, and are publishing the criteria to between August 2, 2000 and August 1, 80 to 90 percent. If any of these
be used for 2001 submission. 2001 will be considered for use in conditions (random sample, complete
computing practice expense RVUs for nationwide listing, and high response
The following are specific criteria and
CY 2002. rate) are not achieved, then the potential
discussion in the May 2000 interim final • The physician practice expense
rule. impacts of the deviations upon national
data from surveys that we use in our representativeness must be explored
• Physician groups must draw their code-level practice expense calculations and documented. For example, if the
sample from the AMA Physician are the practice expenses per physician response rate is low, then justification
Masterfile to ensure a nationally hour in the six practice expense must be furnished to demonstrate that
representative sample that includes both categories—clinical labor, medical the responders are not significantly
members and non-members of a supplies, medical equipment, different from non-responders with
physician specialty group. administrative labor, office overhead, regard to factors affecting practice
• Physician groups must arrange for and other. Supplemental survey data expense. Differential weighting of
the AMA to send the sample directly to must include data for these categories. subsamples may improve the
their survey contractor to ensure Ideally, we would like to calculate representativeness. Minor deviations
confidentiality of the sample; that is, to practice expense values with precision; from national representativeness may be
ensure comparability in the methods however, we recognize that we must acceptable.
and data collected, specialties must not achieve a balance. Conducting surveys
know the names of the specific is expensive, and there is a tension Comments on Criteria for Submitting
individuals in the sample. between achieving large sample sizes, Supplemental Practice Expense Data
• Non-physician specialties not which increases precision, and smaller We received comments from 17
included in the AMA’s SMS must ones, which conserves costs. specialty groups concerning the criteria
develop a method to draw a nationally In addition, in the May 2000 interim for the acceptance of supplemental data.
representative sample of members and final rule (65 FR 25666) we indicated While many of these comments
non-members. At a minimum, these that we believed an achievable level of contained positive feedback on aspects
groups must include former members in precision is a coefficient of variation, of our interim final rule, they all
their survey sample. The sample must that is, the ratio of the standard error of contained statements of opposition to
be drawn by the non-physician group’s the mean to the mean expressed as a specific requirements and/or
survey contractor, or another percent, not greater than 10 percent, for suggestions for improving the process.
independent party, in a way that overall practice expenses or practice Outlined below are the comments from
ensures the confidentiality of the expenses per hour. For existing surveys specialty groups and our responses
sample; that is, to ensure comparability the standard deviation is frequently the concerning the requirements for
in the methods and data collected, same magnitude as the mean. If the supplemental survey data.
specialties must not know the names of standard deviation equals the mean,
the specific individuals in the sample. then a usable sample size of 100 will Required Sampling From the AMA’s
• A group (or its contractors) must yield a coefficient of variation of 10 Physician Masterfile
conduct the survey based on the SMS percent. For small, homogeneous Comment: Four groups stated that the
survey instruments and protocols, subspecialties, the variations in practice requirement for survey respondents to
including administration and follow-up expenses may be lower because a be drawn solely from the AMA
efforts, and definitions of practice smaller sample size achieves this level Physician Masterfile is inappropriate for
expense and hours in patient care. In of precision. Other ways of expressing the specialties of radiology and
addition, any cover letters or other precision (for example, 95 percent radiation oncology. They believe that
information furnished to survey sample confidence intervals) are also acceptable hospital-based radiologists and
participants must be comparable to such if they are approximately equivalent to radiation oncologists do not encounter
information previously supplied by the a coefficient of variation of 10 percent the same practice expenses for staff and
SMS contractor to its sample or better. We indicated that will supplies as those radiologists and
participants. consider surveys for which the radiation oncologists working in

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00007 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
65382 Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations

freestanding centers. According to the associates and affiliate members such as members of a specialty society. We
groups, radiologists and radiation osteopathic dermatologists, physicians cannot assume that the average practice
oncologists working in a freestanding conducting research in dermatology, expenses of members and non-members
center encounter capital intensive TC and practicing dermatologists certified of a specialty group are comparable
services not incurred by hospital-based by a foreign board but now practicing in without data to support this finding.
physicians and, often, these TC the United States. According to the The AMA Physician Masterfile is the
component costs are borne by non- group, other, ‘‘self-designated’’ most comprehensive list of physicians
physician entities not included in the dermatologists should not be included practicing in the United States. A
Physician Masterfile. The groups also in the sample for dermatology because specialty society’s members are likely to
believe that the small number of their practice expense data could be include only a portion of the physicians
radiologists and radiation oncologists unrepresentative and potentially practicing in that specialty. Thus, we
who own and operate a freestanding damaging to the practice expense RVUs believe that it is likely that a random
center will not be represented in a for dermatology. sample selected from the AMA
sample from the Physician Masterfile. Response: Self-designation of Physician Masterfile is going to be more
The groups suggest that we work with specialty is not unique to representative of a specialty than a
the professional community to develop dermatologists. In the Physician sample drawn from a specialty society’s
a list of freestanding radiation centers Masterfile, all specialties are based on membership list. For this reason, we are
from which we could extract a self-designation. The SMS survey deals maintaining the requirement that the
geographically diverse sample. with the issue of self-designation by sample of physicians must be drawn
Alternatively, the groups suggest that, asking respondents if their specialty from the AMA Physician Masterfile.
because of potential low response rates, designation is representative of the
specialty practice from which they gain Required Use of SMS Survey
we include all radiation practices in the
the majority of their medical income. It Instruments and Protocol
survey sample and use the data for those
physicians not working at freestanding is important to note that if any Comment: One group expressed
centers only in the calculation of PC physician who is self-designated as a concern that the SMS survey does not
services. dermatologist furnishes dermatological account for care hours induced by the
One group expressed concern that by services to Medicare patients, it is Emergency Treatment and Labor Act
sampling from the AMA Physician appropriate for this physician to be (EMTALA) in the patient care hours
Masterfile, a substantial number of included in the sample because this question, thereby overstating the hours
emergency medicine practices are physician receives income for and understating the practice expense
overlooked. The small number of dermatological services. costs. They recommend that a question
physician practice owners leads to a Comment: Three groups suggested be added to the SMS that asks
strong possibility that these owners will that the requirement to sample from the respondents about the patient care
not be selected in the random sample. Physician Masterfile may not be hours they spend in an average week
They suggest that we permit an reasonable, as it serves only to limit providing EMTALA-induced care. Each
additional sample of large emergency specialties’ ability to present alternative specialty’s average amount of EMTALA-
medicine practice groups to supplement data to us. They noted that the induced care should then be deducted
the current survey. requirement to sample from the from the total hours spent in patient
Response: The Physician Masterfile is Physician Masterfile is based on the care. The commenter recognized that
the most extensive list of physicians in assumption that physicians outside of this is a long-term recommendation and
the United States, and, therefore, we the specialty group have different costs wished to work on an interim solution
believe it is the most appropriate list than members of the group. One with us.
from which to develop a random sample commenter maintained that the Response: We understand the group’s
of physicians within a specialty. substantial variance in practice concerns and have contracted with The
Currently, we are not aware of a expenses within members’ practices Lewin Group to provide
complete list of radiation and radiation makes it unlikely that non-members’ recommendations on both the
oncology practices or emergency practices would extend this variance. In modification of future surveys to
medicine practice groups that exists that addition, one group suggested that account for EMTALA-induced patient
is more comprehensive than the societies representing a smaller care hours and the use of these data to
Physician Masterfile with the proportion of specialty practitioners adjust practice expense values. We have
information necessary to extract a should be allowed to explore options for also made specific comments to the
representative random sample. If such a addressing potential bias beyond AMA requesting that this issue be
list were to exist or be developed in the sampling from the Physician Masterfile. addressed in any future work they may
future, we would consider the According to the group, nonmembers of do with regard to collecting survey data.
appropriateness and potential uses for a specialty society are unlikely to In the interim, we have made an
sampling. We would welcome respond to what they consider a time- adjustment to the practice expense per
information from physician and other consuming and intrusive survey about hour for emergency medicine to address
organizations on specific data sources sensitive financial issues. this issue. We have no reason to believe
from which representative samples of Response: We believe that the emergency medicine is being
physicians could be selected, if there is commenter is arguing that is should be disadvantaged in the interim as a result
concern that the AMA Masterfile is not sufficient to draw a sample from the of this adjustment. We will consider
a comprehensive list for the specialty. members of a specialty society because The Lewin Group’s recommendations.
Comment: One group commented that there is unlikely to be a difference in Comment: Six groups questioned the
the AMA Physician Masterfile may practice expense per hour between adequacy of the SMS survey for the
contain ‘‘self-designated’’ members and nonmembers of a purpose of accurately assessing a
dermatologists who do not meet the specialty society. Our goal in collecting particular specialty’s practice expenses.
criteria for ‘‘qualified’’ dermatologists. practice expense data is to create For example, one group believes that
They defined ‘‘qualified’’ dermatologists practice expense values that reflect the additional questions are needed to
as board certified dermatologists, costs of both members and non- account for cardiology TC questions.

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00008 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations 65383

They recommend that we revise the Comment: Two groups expressed Response: The best source of current
criteria for supplemental surveys to concern that requiring cover letters and information on the status of the SMS
allow for the collection of additional other information furnished to survey survey would, of course, be from the
data through specialty-specific participants to be comparable to those AMA. Any plans on our part would be
questions. supplied by the SMS contractor will included in information provided as
Response: We consider the SMS hamper response rates. They believe part of future revisions to practice
survey to be adequate for the purpose of specialty groups should be able to expenses.
accurately assessing practice expenses. provide correspondence that explains
However, we agree that additional the importance of the data for the Comments on the Response Rate
clarification and examples tailored to benefit of the specialty without our Comment: Seven groups objected to
specific specialties may improve the ‘‘censorship.’’ the response rate of 80 to 90 percent
accuracy of the data collected. Although Response: Although specialty-specific mentioned as a criterion for the
we do not want specialties to change the correspondence may increase response presumed national representativeness of
basic structure of the SMS practice rates, it could potentially introduce bias a sample. The groups stated that the
expense module, we have not precluded into the practice expense data. We SMS has never achieved a response rate
any groups from collecting additional believe that it is essential to obtain this high, and that specialty groups
data specific to the specialty in their unbiased data. should not be expected to achieve a
supplemental surveys. Comment: One group suggested we response rate higher than that achieved
Comment: One group suggested that use the tax form 1120 as a foundation by the SMS. Two groups suggested an
we adopt the AMA’s practice level for validating practice expense data. acceptable response rate of 30 to 40
Practice Expense survey in place of the They suggested that independent percent, and the American Academy of
SMS and revise the criteria for accountants could be used to compare Ophthalmology (AAO) suggested an
supplemental survey data accordingly. the practice expense data submitted to acceptable response rate of 30 percent.
They also suggested that our references the actual expenses on the tax form. The ACR requested an acceptable
to the SMS survey may be Response: The Lewin Group has response rate of no higher than 65
misunderstood by specialty groups considered this recommendation and,
percent. Three groups objected to our
referencing the AMA’s practice level after discussions with the AMA and
response rate but did not suggest an
survey instrument, and that we must numerous physician specialty groups,
alternative rate.
clarify this distinction. Two groups has determined that practitioners may
not respond to the survey if they believe Response: The 80 to 90 percent
recommended that the specialty groups
their data may be audited. However, response rate was presented as a rate at
should collect practice level data, rather
The Lewin Group does believe that a which we can presume that the sample
than individual physician estimates.
One group also suggested that a practice closer link between the survey is nationally representative, but not as
level survey should be developed to worksheet and a practice’s tax forms an absolute requirement for the
more appropriately capture the practice may improve the accuracy of the data. acceptance of data. As we stated in the
expenses. We may consider this as a longer-term May 3, 2000 interim final rule (65 FR
Response: The AMA has fielded the refinement issue. 25666), we are attempting to be as
practice expense level survey with Comment: One group recommended reasonable as possible. However,
minimal success. At this time, we that we develop a workable alternative surveys with a response rate lower than
understand that the AMA does not plan to the SMS survey. They noted the 80 percent cannot be assumed to be
to continue with the practice expense indefinite suspension of the SMS nationally representative, and, for us to
level survey. We are currently using the survey, and the lack of evidence that the accept these data, a specialty group
physician level SMS as the basis for SMS is the best source of obtaining must demonstrate that the survey
supplemental surveys, and will practice expense data at the specialty respondents are not significantly
continue to use this survey to maintain level as reasons for their suggestion. different from non-respondents. In
consistency with our existing data. We They suggested we develop a set of core addition, based on our review of the
cannot use the AMA’s practice level questions and standard definitions to be supplemental surveys submitted, we are
survey, or any other survey, until it has incorporated in each specialty’s survey. modifying our criteria concerning an
been evaluated to determine if the If we create an alternative to the SMS, acceptable level of precision for surveys.
survey data can be incorporated into our They requested that we take into We now believe a reasonable level of
practice expense methodology. In account the extensive amount of time precision for surveys to be used for
addition, we would have to determine if involved in designing and conducting supplementing current data is a 90-
it is possible to reconcile the outcomes an effective practice expense survey. percent confidence interval with a range
of the physician level and practice level Response: The Lewin Group has of plus or minus 10 percent of the mean
surveys. We have asked The Lewin already worked with specialty groups to (that is, 1.645 times the standard error
Group to review the AMA’s practice modify the SMS survey for of the mean, divided by the mean,
level survey to determine how the data administration as a supplemental should be equal to or less than 10
collected could be used to calculate survey. The Lewin Group will continue percent of the mean).
practice expenses per hour values. to help specialty groups field Comment: One group commented that
Comment: Four groups requested that supplemental surveys. it is highly unlikely that small
specialty groups be allowed to conduct Comment: One group requested that specialties will be able to achieve the
the supplemental surveys by mail with we keep the specialty groups updated coefficient of variation of less than 10
follow-up phone interviews. The groups on the status of the SMS survey and any percent for overall practice expenses or
believe this will reduce the cost of potential solutions or alternate plans we practice expenses per hour that we
administering a survey. develop to account for the absence of require for the acceptance of
Response: As explained previously, to new SMS data. They stated that keeping supplemental data. They note that the
help obtain comparable data, we believe the specialties current would allow original SMS survey did not achieve
supplemental surveys should follow the them to anticipate extra spending on this threshold for many small specialties
SMS methodology. survey projects. and, therefore, question the application

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00009 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
65384 Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations

of the requirement to supplemental expense per-hour calculations and that will be filling in the data gap left by the
surveys. we are now basing our practice expense SMS and, therefore, we should
Response: In developing the resource- per-hour calculations on a 4-year subsidize the cost of completing the
based practice expense RVUs, we average. Regarding the deflation of the surveys. In addition, one group
consulted widely with physician practice costs to 1995, as long as the commented that the efforts needed to
groups, researchers, and others to same deflator is used across specialties, meet the supplemental survey
identify possible data sources. Nearly all the particular year to which the requirements may be prohibitively
commenters agreed that the SMS data, specialties are deflated is insignificant. costly for many specialties without
while not specifically designed for the The base year of 1995 was chosen to be subsidization from us. One group also
purpose of establishing practice expense consistent with the data we have commented that we should take into
RVUs, was the best available data for already. account the AMA’s problems with the
this purpose. We believe our criteria, as Comment: One group commented on expense of administering the SMS
discussed above, help assure that any our decision to weight average the before fully adopting the survey
data used to supplement the SMS data supplemental data with the existing protocol. Specifically, they suggested
are statistically valid and representative. SMS data already being used. According that we look for less costly, and more
Further, we believe these criteria are to the group, this decision is flawed cost-effective, ways of validating the
reasonable and achievable. For example, because it erroneously assumes that the data than telephone interviews.
a specialty society for thoracic surgeons SMS data currently in use is correct. In Response: We have no funding for
submitted supplemental data that we addition, they believe that the SMS supplemental surveys, and we are not
incorporated last year. These data from sample size for emergency physicians currently considering such approaches.
the STS achieve our statistical criteria has been too small to provide valid data As we have previously explained, we
for supplemental surveys. We also note for the calculation of practice expenses. believe the SMS data are currently the
that the 90-percent confidence interval The group suggested that it is best available source of practice cost
requirement seems very reasonable in inappropriate for us to weight average information. We believe there are
that, in general, a 95-percent confidence data from this unrepresentative sample significant, methodological advantages
interval is a more typical statistical with supplemental survey data for to obtaining practice cost information
standard value. emergency physicians. through multi-specialty surveys such as
Comment: One group requested that Response: The SMS data is the best SMS, rather than through surveys of
we provide the specialty groups ‘‘with data currently available for the more limited groups of specialties. The
a comprehensive definition of calculation of practice expenses. As supplemental survey process allows
‘complete’ and ‘incomplete’ data in refinements of the practice expense specialties the option to provide
addition to an explanation of the extent methodology are identified and additional information.
to which incomplete data will be included, we will extrapolate and apply Comment: Two groups suggested that
excluded or utilized in practice expense them to past SMS data to the extent we should eliminate some of the criteria
calculations.’’ At a minimum, the group possible. Weight averaging the for the acceptance of outside survey
requested indicators for required and supplemental survey data with the data if a specialty can demonstrate that
non-required data fields on the survey existing SMS data would be used to the collected data are valid practice
instrument. increase the sample size. We also expense data for the specialty.
Response: The required data fields for established the criteria for supplemental According to one commenter, some
the survey instrument are available from surveys in the May 3, 2000 interim final specialty groups may have valid data
our contractor, The Lewin Group, and rule (65 FR 25666) as a guideline for that does not exactly meet the criteria
from the protocols and guidelines we those specialties seeking to increase we outlined, but nevertheless could be
have created for the supplemental their sample size. a valuable data source.
surveys. The original SMS survey data Response: In the May 3, 2000 interim
obtained from the AMA was accepted Short Time Frame for Data Submission final rule (65 FR 25666), we presented
only for surveys with complete practice Comment: Three groups expressed the criteria for specialty societies
expense and patient care per-hour concern with the short time frame we seeking to collect new practice expense
information. We will continue to use have provided for specialty groups to data through supplemental surveys. The
these criteria for the acceptance of data. develop the survey methodologies, find process established by these criteria, as
(A copy of the guidelines and a contractor, and provide the data for amended by this final rule, should be
procedures may be obtained by computation of RVUs. followed by specialty societies to collect
contracting Lane Koeing at The Lewin Response: Section 212 of the BBRA future supplemental practice expense
Group at (703) 269–5659.) required that we establish, through data.
regulation, a process for any
Data Adjustment organization to collect and submit Survey Contractor Requirements
Comment: Three groups commented supplemental survey data for use in Comment: One group expressed
on our use of the 1995 through 1997 establishing payments for the calendar concern about contracting for survey
specialty practice expense per-hour data years 2001 and 2002 physician fee research. According to the group, many
from the SMS and our deflation of schedules. Thus, the amount of work specialties have staff capable of
supplemental survey data to 1995 required to be accomplished in a short analyzing the survey data. Requiring
practice costs. The groups stated that we time was largely due to the specialties to contract for the surveys
should use the most current data requirements of the statute itself. could eliminate certain subspecialties
available for all specialties rather than from administering a supplemental
earlier data of questionable relevance. Cost Burden of the Supplemental survey due to cost burden.
Response: We indicated in the July Surveys Response: We recognize the cost
2000 proposed rule (65 FR 44181) that, Comment: Two groups commented burden of contracting for the
based on a recommendation by The that we should share the cost burden for supplemental survey administration;
Lewin Group, we have incorporated the the supplemental surveys. According to however, to ensure the integrity of the
1998 SMS data into our practice the groups, the supplemental surveys practice expense data, we are requiring

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00010 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations 65385

that a disinterested third party Comment: One group requested that we continue to believe that it is
administer supplemental surveys. we provide specialty groups with the impossible and impractical to set rigid
Comment: One group questioned our criteria for determining if data supplied cutoffs, we are expecting higher
requirement for specialties to use a between August 2, 2000 and August 1, response rates than were achieved in the
survey contractor with experience in 2001 is usable. We state in the interim supplemental surveys submitted to us in
conducting national multi-specialty final rule that submitted data will be 2000. We would like to see detailed
surveys of physicians using random considered, but we do not state whether analyses that indicate the sample is
samples. They believe that a contractor the criteria for acceptance will be the representative of the population. While
with experience surveying health care same as the criteria for data supplied by The Lewin Group was able to perform
professionals and using random sample August 1, 2000. some limited analyses of response bias
techniques should be sufficient. Response: The criteria for accepting for the supplemental surveys received
Response: We believe our initial supplemental survey data were in 2000, we expect that these
requirements represent a preferred way presented in the May 3, 2000 interim supplemental surveys received in 2001
to collect valid and reliable data. We final rule. These criteria were subject to will provide detailed analyses with
will, however, consider survey public comment, and any modification respect to possible response bias on
contractors with experience surveying we have made to these criteria, as a factors that could affect practice
health care professionals, collecting result of the comments, are part of this expenses. Such analyses should
financial information, and using random final rule. consider variables such as specialty
samples. Result of Evaluation of Comments society membership, years in practice,
Comment: Two groups are concerned board certification, gender, geographic
The criteria published May 3, 2000 distribution of respondents, and
with our requirement for raw survey will be used for surveys submitted in
data to be submitted to us. One group practice arrangements (for example, solo
2001 with the following modifications.
believes that we should outsource the practitioners or large group practices).
• We had proposed that specialty
analysis of the survey responses. The We will not consider supplemental data
groups use a contractor that has
other group opposes the submission of experience with the SMS or a survey in the practice expense methodology
raw data to us because they believe firm with experience successfully unless we receive detailed analyses that
physicians will be unlikely to respond conducting national multi-specialty give us confidence that survey
to sensitive financial questions if they surveys of physicians using nationally respondents are representative of the
are informed that their individual representative random samples. We profession on items that affect practice
responses will be sent directly to the have modified the criteria to provide for expense. In addition, the data must
government. using a contractor that has experience appear reasonable and consistent with
Response: The raw survey data have surveying health care professionals, other data used to determine practice
been submitted to The Lewin Group, collecting financial information and expense RVUs.
and they have provided us with only using random samples. Submission of Supplemental Surveys
aggregate practice expense values. • In addition, based on our review of
the supplemental surveys submitted, we In response to the May 3, 2000
HCFA’s Use of the Supplemental Survey
are modifying our criteria concerning an interim final rule, three organizations
acceptable level of precision for surveys. submitted supplemental survey data for
Comment: One group expressed We now believe a reasonable level of consideration. One survey was
concern about our use of the precision for surveys to be used for submitted by the American Physical
supplemental survey data. Before supplementing current data is a 90 Therapy Association (APTA), and a
administering an expensive survey, they percent confidence interval with a range joint survey was submitted by the
want assurance from us that the of plus or minus 10 percent of the mean; American Association of Vascular
supplemental data will be used. (that is, 1.645 times the standard error Surgery (AAVS) and the Society for
Alternatively, the group believes we of the mean, divided by the mean, Vascular Surgery (SVS). Our contractor,
should conduct a survey across all should be equal to or less than 10 The Lewin Group, has evaluated the
specialties. They commented that we percent of the mean). data submitted by each organization and
must adopt one of these options to With respect to response rates, we are recommended that we use these data.
remove flawed data that does not concerned about the low response rates The full recommendation and
account for the unique practice received from supplemental surveys discussion will be made available on the
expenses related to emergency submitted to us in 2000. While we HCFA website. We have decided to use
medicine. acknowledge that the timing of the the data submitted by the AAVS and
Response: The criteria for the surveys (that is, short-field time and SVS to supplement the information we
consideration of supplemental survey time of year) contributed to the low are currently using. However, we have
data are described in this final rule. We response rates, we believe that groups decided not to use the data submitted by
anticipate incorporating data that meet will have more time to conduct surveys the APTA. The revised practice expense
these criteria in the practice expense and, thus, are likely to obtain better per hour figures that we are using for
methodology. response rates in future surveys. While vascular surgery are:

Clinical staff Admin staff Supplies Equipment Other Total

20.2 .................................................................................. 18.1 17.7 3.2 4.5 11.4 75.1

These figures are from the adjusted by the MEI so the figures by the cumulative MEI for 1996–1999
supplemental survey information reflect 1995 data. That is, we divided (1.0877).
provided to us from the Lewin Group the 1999 practice expense per hour data

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00011 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
65386 Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations

Both supplemental surveys have the issues addressed by these data revise edits and trims to the SMS survey
extremely low response rates (about 14 elsewhere in this preamble. data to exclude data that fall outside set
percent for vascular surgeons and 11 acceptable ranges.
(ii) Proposals for SMS Refinement In the July 2000 proposed rule (65 FR
percent for physical therapists). We
specified the criteria we would apply In the July 2000 proposed rule (65 FR 44184), we also discussed the
for supplemental surveys in the May 44180), we discussed the tasks that our suggestions we made to the AMA for
2000 interim final rule (65 FR 25666). contractor, The Lewin Group, was including additional questions in the
While we did not establish a precise undertaking to assist us with broad SMS survey that would make it more
minimum response rate, we did indicate practice expense technical and useful for calculating specialty-specific
that surveys with response rates less methodological issues. We also practice expenses more precisely. It now
than 80 percent to 90 percent require an highlighted the recommendations that appears that the AMA may no longer
analysis to determine to what extent the were contained in the first draft report undertake a multi-specialty survey to
sample is representative of the that the contractor submitted, ‘‘Practice collect practice expense information.
population. The extremely low response Expense Methodology,’’ dated While we will continue our discussion
rates achieved by these two September 24, 1999. This report is on with the AMA regarding any future
supplemental surveys and the relatively our homepage under the title ‘‘Practice plans for practice expense data
small number of responses make it Expense Methodology Report.’’ (Access collection, as stated above, we believe
extremely difficult, and very subjective, to our homepage is discussed under the these recommendations will be useful in
to determine whether the data are ‘‘Supplementary Information’’ section the design of any other survey used in
representative of each specialty. Our above.) developing practice expense RVUs.
contractor was able to make very limited The report contained various As we indicated earlier, we proposed
assessments of this issue based on the recommendations aimed at increasing to use data from the 1998 SMS to
data provided. the validity and reliability of the AMA’s develop the 2001 practice expense
SMS survey. Although the Lewin RVUs. Furthermore, data from the 1999
However, in our May 2000 interim
Group’s recommendations were made SMS will become available later this
final rule, we indicated that, based on
specifically to address improving the year for use in developing the 2002
our review of existing physician
SMS survey for calculating practice practice expense RVUs. In addition,
practice expense surveys, we believe
expense RVUs, we believe the section 1848(c)(2)(B) of the Act requires
that an achievable level of precision is
recommendations will be useful in that not less often than every 5 years, we
a coefficient of variation, that is, the
making refinements to any other survey review and make adjustments to RVUs.
ratio of the standard error of the mean
instrument that may be used in Thus, we are required by the statute to
to the mean expressed as a percent, not
calculating practice expense RVUs. The review and make adjustments to the
greater than 10 percent, for overall
recommendations fell into the three practice expense RVUs 5 years after the
practice expenses or practice expenses
following areas: end of the transition period, that is, no
per hour. For existing surveys, the
• The use of data supplementary to later than 2007. Regardless of whether
standard deviation is frequently the
the SMS survey. the AMA continues to collect data on
same magnitude as the mean. We • Suggested changes to the survey practice expenses, we will be
indicated in the May 2000 interim final instrument. developing plans for making
rule that we would consider practice • Recommendations for using the refinements to practice expense RVUs
expenses for which the precision of the data in calculating the specialty-specific beyond 2002.
practice expenses is equal to or better practice expense per hour. Comment: One specialty society
than this level of precision and that In response to the report’s indicated that SMS data from 1998 and
meet the other survey criteria. recommendations on the use of the SMS 1999 is available and we have not used
The data submitted by the AAVS and data, we proposed to incorporate data this data in the past because of fears that
the SVS met the level of precision. The from the 1998 SMS survey, which is the the data may be tainted now that some
data submitted by the APTA did not rise latest data available, into our practice physicians know that the responses
to this level of precision; they did not expense per-hour calculations. In could affect Medicare fees. The
meet this objective criterion set out in addition, we proposed basing the commenter recommended that we use
the May 2000 interim final rule. Thus, practice expense per hour calculations data from 1996 through 1999, rather
we do not have, in the survey data on a 4-year average, rather than the 3- than the 1995 through 1998 data we
submitted by the APTA, data that year average recommended in the have proposed using.
convince us of both the contractor’s report. We published a table Response: In the November 2, 1998
representativeness or the precision of that contained the practice expense per- final rule (63 FR 58821), we expressed
the surveys. For that reason, we are hour calculations for CY 2001 that concern about the potential biases that
unable to incorporate the supplemental resulted from the above proposals. We may exist in surveys collected by
survey data submitted by the APTA in also proposed standardizing the practice individual specialties and in any survey
the practice expense system. expense data to reflect a 1995 cost year data collected in the SMS survey
We note, however, that we have made consistent with the pricing information process subsequent to our June 5, 1998
an adjustment to the practice expense we are using for the estimates of proposed rule. There is no relationship
data for physical and occupational practice expense inputs for individual between this concern and any decisions
therapy services based on other procedures. To standardize costs, we that we have made with respect to
comments received. These comments proposed inflating 1995 cost data by the incorporating available data from the
and adjustments are described MEI and deflating 1996 and 1997 costs SMS survey process into the practice
elsewhere in this regulation. data. This proposal has virtually no expense methodology. Since SMS
In addition, one specialty society also impact on the practice expense per-hour survey data from 1998 was collected
submitted data concerning clinical staff calculations. more than 1 year before the June 1998
in the hospital setting. The data After discussions with the AMA’s proposed rule announcing the ‘‘top
submitted were not in the context of SMS staff, we did not propose, as down’’ methodology, any implication
supplemental survey data. We discuss recommended by our contractor, to that we did not previously propose use

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00012 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations 65387

of the data because of a concern about we are continuing to rely on the SMS that, in the past, we have been
bias in the data is inaccurate. Rather, we data in the process for determining unwilling to use SMS data if the number
have not previously proposed using the practice expense RVUs, we believe that of survey respondents is low. Other
data because it was unavailable to us the specialty-specific representation in commenters expressed concern that for
before this year’s proposed rule. In the data is now improved by some specialties, the small sample of
addition, we did not propose using SMS incorporating an additional year of data. physicians would mean that the practice
data from 1999 because it was The practice expense per hour will be expense per hour could not be
unavailable to us at the time of the based on a larger number of survey calculated accurately and such unstable
proposed rule. We will consider using responses that will likely result in data would produce some substantial
1999 data from the SMS for setting 2002 improved representativeness of the data. changes. These commenters suggested
physician fee schedule rates. As we Comment: One commenter contended that we not incorporate additional data,
stated in our July 2000 proposed rule that the data in the practice expense including the 1998 SMS data, until a
(65 FR 44184), we welcome comments per-hour table in the July 2000 proposed representative practice expense sample
on long term strategies for collecting rule do not appear logical, objective, or can be performed with an adequate
practice expense data in the future. consistent. There is an unexplained number of respondents for all
Comment: We received two comments range of clerical payroll per hour among specialties.
that indicated that the SMS sample for similar specialties, and the ranking of One specialty commented that
gastroenterology is small and the practice expenses among specialties inclusion of the 1998 SMS data is
inadequate, that the response rate in the appears to be untenable; for example, premature because of questions
SMS is the lowest among any specialty, the total practice expense per hour for regarding its validity, since AMA is
and that the practice expense dermatology is almost two times greater redeveloping the SMS with the
calculations are probably inaccurate. than for gastroenterology. possibility of seeking specialty-society
One of these commenters also urged us Response: We believe that different input, and there are questions regarding
to work with the AMA and the medical specialties are likely to have differences the validity of the 1998 SMS data. While
community to improve the aggregate in practice expense per-hour for indirect some commenters agreed with the
specialty-specific data. A specialty types of costs depending upon the general principle of using the most
society representing pediatrics nature of the practice. With respect to current data, they argued that the
reiterated the concern that the pediatric the examples identified, dermatologists quality of the 1998 SMS data does not
specialties are not adequately are generally in office-based practices, merit inclusion into our practice
represented in the SMS, and a society while gastroenterologists provide most expense per-hour calculations. One
representing geriatrics also believed that services in hospitals. The nature of commenter stated that the SMS survey
the sample size of geriatricians is not these types of practices may result in does not recognize the unique nature of
large enough to yield reliable data. very different expenses for emergency medicine.
Another commenter was concerned administrative personnel. Without Alternatively, there were many
about the inadequate sample size of disaggregating the costs and describing comments that supported our use of the
radiation oncologists in the SMS and the different administrative activities 1998 SMS data. These commenters
believed that the use of the Physician that are performed by employees of the generally indicated that we should use
Masterfile under-samples non-hospital different types of specialties, it is the most current data because practice
based radiation oncologists and over- difficult to explain deviations in the expenses may change over time. In
samples hospital-based radiation practice expense per hour among addition, these commenters indicated
oncologists, who do not incur the same specialties. Nevertheless, we reviewed that there is no evidence that the 1998
practice expenses for equipment and data on administrative practice SMS data is tainted or otherwise
staff. Several imaging specialties stated expenses per hour across specialties for objectionable. Other commenters
that the SMS does not capture the each individual SMS data year and indicated that including more survey
practice expenses for TC services, found, with some exceptions, that there responses from later SMS years will
probably because the SMS sample is is stability among the relative practice result in practice expense values that
skewed toward professional-component expense per hour for this item across are more representative of physicians’
only providers. These commenters years. For instance, for 3 of the 4 years costs. Some commenters indicated that
argued that, even if the sample of TC that there is survey data, the practice expense data based on a 4-year
providers were adequate, the higher TC administrative practice expense per sample provides greater assurance of its
costs would be diluted by the lower PC hour for gastroenterology is between 61 quality. Many of the commenters that
costs, and thus it is necessary to perform and 63 percent of dermatology (in the suggested incorporating the 1998 SMS
a survey of only TC providers to use in remaining year, it is 53 percent). We data also indicated that we should use
the practice expense calculations. believe that the apparent stability of the the 1999 data from the SMS when it
Response: Since concerns regarding relative practice expense per hour becomes available. Other commenters
the representation of various specialty across specialties provide assurance of supported our proposal to base the
societies in the SMS data were raised the data’s reliability. practice expense per-hour calculation
previously, we are reiterating our Comment: We received a number of on a 4-year average of SMS data as
general response that can be found in comments expressing concern about our opposed to a 3-year average, because it
more detail in the November 2, 1998 decision to incorporate 1998 SMS data will help to compensate for the low
final rule (63 FR 58821). As we into the practice expense methodology. number of survey responses from some
indicated in that rule, many of the Several commenters noted that there specialties in the prior years’ SMS
criticisms of the SMS data could well be were a small number of usable surveys.
made about any other practice expense responses for some specialties to One commenter believed that we
survey. At the time, we proposed use of calculate the practice expense per hour should follow our contractor’s
the SMS data for developing the using the 1998 SMS data, citing that recommendation and use a rolling 3-
practice expense RVUs, we indicated cardiac and thoracic surgeons and year average, because using 4 years
that it was the best available data source radiation oncologists had only three results in older data completed by
on aggregate practice expenses. Since responses. Another commenter stated persons less familiar with the SMS.

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00013 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
65388 Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations

Other commenters supported using only practitioner category), we made an error just Medicare payers, were used. (In
the latest 3 years of data to eliminate the in the practice expense per hour reality, however, the data is potentially
oldest practice expense data from the calculation in the July 2000 proposed biased by the inclusion of mid-level
methodology. rule. After correcting this error, there is practitioners. See the June 5, 1998
Response: While the lower response only approximately a 1-percent increase proposed rule (63 FR 30832) for a more
rates in the 1998 SMS data are a in the nonphysician practitioner detailed discussion of this issue). If the
concern, we continue to believe it is category from incorporating the median practice expense per hour were
appropriate to incorporate these additional SMS data. We believe that used, however, the aggregate cost pools
additional data into the practice these results support the argument that would not be reflective of physicians’
expense methodology. In general, even the practice expense per hour is actual expenses, because very high-cost
though there are fewer responses in the generally stable and that it is or low-cost practice data would be
1998 SMS data, it is unclear to us why appropriate to include 1998 SMS data in excluded. Since the statute indicates
this alone indicates that we should the practice expense methodology. that we should ‘‘recognize all staff,
reject incorporating the data. Generally, With respect to the comment that it is equipment, supplies and expenses,’’ we
the inclusion of more survey data will premature to incorporate 1998 SMS data believe use of the mean rather than the
improve the data’s representativeness into the practice expense methodology median practice expense per hour will
and lead to more stability in the practice because of AMA efforts to redesign the result in the practice expense RVUs
expense methodology. Furthermore, to survey and include specialty society being more reflective of all physician
the extent that there are fewer responses input, we are unsure of the AMA’s practice costs.
to the 1998 SMS survey, there will be efforts in this regard. Nevertheless, Comment: We received several
less impact on a given specialty because while we would welcome comments that were concerned about
the practice expense per-hour multispecialty involvement in an effort the AMA’s decision to no longer collect
calculation is weighted by the number to collect practice expense data practice expense data from the SMS.
of respondents from each respective specifically for the purpose of One commenter noted that the Lewin
year. With respect to the stability of the determining relative value units, we Group recommendations described in
data, the AMA indicated that a believe that such efforts should not have the proposed rule were aimed at
statistical test of the data ‘‘revealed only any bearing on our decision to improving the SMS surveys and/or
marginal evidence of a statistically incorporate later SMS data into the practice level surveys that the AMA no
significant change in PE–HR across practice expense methodology at this longer intends to perform. Other
specialties when all specialty-level time. If new data were to be collected commenters expressed concern about
changes were considered jointly. In under a redesigned survey process, it plans for gathering practice expense
other words, the combined set of could be at least 2 years before such data for years after 1999, particularly if
changes in relative PE–HR were with data is available to us. In the interim, we the AMA will not continue the SMS
the range of what could be expected by believe it is appropriate to include the survey. Two commenters recommended
sampling error.’’ Thus, although there latest SMS data into our methodology. that we initiate a dialogue with
may have been some large changes in We disagree with the commenter who specialty societies to develop a
practice expense per hour across years suggested that the older SMS data workable alternative and another that
for some specialties, there appears to be should be eliminated from the practice we consider creating and funding a
overall stability across years among all expense per hour calculations because survey to collect practice expense data
physicians. the surveys were completed by in the future. One organization
In general, use of the 1998 SMS respondents less familiar with the SMS. commented that the AMA’s decision to
improves the stability of the practice The SMS is a longstanding survey that no longer collect practice expense data
expense per hour and results in little was originally developed by the AMA in means that issues related to
specialty level impact. For the 35 1981. There is no evidence that data uncompensated care in the practice
specialties listed in our impact table in from earlier SMS surveys is less reliable expense methodology will not be
the July 2000 proposed rule (65 FR than later survey information. addressed. This commenter stated that
44203), 21 specialties will experience an Comment: A commenter representing we should continue to work with
impact that is near zero. There are nine urologists stated that, if we are not going emergency physicians to ensure that
specialties that will experience an to accept our contractor’s what the society feels are flawed
impact of approximately 1 percent as a recommendation to revise the edits and practice expense data are no longer used
result of inclusion of the data. For two trims to the SMS survey data, the use of to determine payment amounts for
(cardiac and thoracic surgery) of the median values, rather than means, emergency physicians.
four specialties that show a payment would produce the most fair relative Response: We share these
impact of approximately 2 percent, the ranking of the practice expense per hour commenters’ concerns about the AMA’s
data were affected by more than just the among medical specialties. decision to no longer collect practice
inclusion of the 1998 SMS data. In the Response: We believe it is appropriate expense data. However, we continue to
November 1999 final rule (64 FR 59391), and consistent with the statute to use believe that the recommendations of the
we indicated that supplemental data the mean practice expense per hour Lewin Group and our suggestions to the
would be incorporated in the practice rather than the median. Under the AMA regarding improvements that
expense per hour and we would not practice expense methodology, the could be made to the SMS and practice
include data from the 1995 SMS. We are practice expense per hour for each level survey will be helpful in future
now adding the 1995 SMS data as well specialty is multiplied by the physician practice expense data collection efforts.
as the 1998 SMS data to the calculation time per procedure and number of As the AMA indicated in a letter to us
of practice expense per hour and Medicare allowed services and summed (see 63 FR 30829 for the AMA’s more
increased the likelihood that there at the specialty level to produce detailed comments), the SMS data were
would be a larger impact on the practice aggregate specialty cost pools. In theory, never collected for the purpose of
expense per hour. For one specialty the aggregate practice expense pools developing relative values. The Lewin
(physical and occupational therapy, would reflect actual physicians’ costs if Group recommendations and our
included in the nonphysician the utilization data for all payers, not suggestions to the AMA were intended

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00014 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations 65389

to tailor the SMS or a practice level However, it is possible that there will Response: We believe that the
survey to be more suitable for this be more significant changes in relative numerator of the practice expense per
purpose. While our comments were practice expense per hour over time hour calculation should exclude any
addressed specifically to improving the among specialties. The statute requires costs associated with mid-level
ability of the SMS or a practice level that we make refinements in the practitioners and the denominator
survey to be used for developing practice expense RVUs at least every 5 should include their patient care hours.
practice expense RVUs, there is no years. While we expect to continue Unfortunately, the data from the SMS
reason that these suggestions would not making refinements to the inputs for do not permit the calculations to be
be equally valid for any alternative individual codes on an annual basis, it performed in this way. We believe that
practice expense survey instrument that could be several years before we might this issue should be addressed in any
may be developed. Thus, we continue to require practice expense data from a multispecialty survey instrument that
believe that there is merit in the work multi-specialty survey after the initial will be used in the future to collect
of the Lewin Group and in our refinement period ends in 2002. While practice expense data and determine
suggestions on improvements to the we consider how to approach this issue, practice expense RVUs. We disagree
AMA survey. we welcome the comments that with the commenter that there is a
With respect to the concerns suggested that we seek input from the feasible way of making an adjustment to
expressed about gathering practice medical community in developing a the aggregate practice expense pools
expense data beyond 1999, we have mutually satisfactory and equitable themselves to address this issue. While
published criteria that specialties must approach to obtaining the needed it is unclear from the comment about
follow to submit supplementary practice information on practice expenses for how such an adjustment would be
expense survey data that can be future refinement efforts. made, it is possible that the commenter
included in the practice expense Comment: A society representing believed that we can use Medicare
calculations. Thus, there is a process for vascular surgeons commented that utilization data to determine the
specialties to collect representative data separately billable income should be proportion of total allowed services for
on practice expenses for a specialty that deducted from practice expenses as part cardiac thoracic surgery procedures,
can be used to influence the calculation of the practice expense per hour where the specialty data indicates that
of practice expense RVUs. Furthermore, calculations, because the inclusion of the service is performed by a mid-level
we are currently planning to use 1999 this income may account for the practitioner assisting at surgery; perhaps
SMS data to determine the practice inexplicably wide range in the practice the commenter assumes that we would
expense per hour for calculating expense calculations among specialties. use this proportion to reduce the size of
practice expense RVUs for 2002. Thus, Response: We agree that it is desirable the aggregate cost pool. We believe that
the fully implemented resource-based it is not possible to make an equitable
to identify separately billable services.
practice expense RVUs will be based on adjustment in this way. First, the
As explained elsewhere, this is an issue
a weighted 5-year average of the latest aggregate cost pools are constructed
for future SMS revisions.
SMS survey data. using a total practice per hour figure,
Regardless of whether the AMA were Comment: One commenter suggested
and the proportional adjustment would
to continue the SMS survey, it is that we move the SMS clinical labor
reflect only Medicare data. Second, it is
unclear whether it would be necessary expenses to the indirect expense
not clear to us how such a calculation
or even desirable to incorporate more category, as was done with the
would be made. An assumption would
recent practice expense per hour data administrative labor cost. The
have to be made that where a mid-level
into the methodology on an annual commenter stated that with the
practitioner is performing a given type
basis. While the practice expense may inclusion of high administrative costs,
of service, the work is being furnished
increase or decrease over time, the the indirect costs will vary considerably
for a given type of physician specialist.
important variable for the practice among specialties and expressed their For instance, if a physician assistant is
expense methodology is whether there concern that the determination of the assisting at surgery for a heart
is a relative change among specialties in scaling factor is not an equitable means procedure, we would have to assume
practice expense per hour. Again, with to distribute these indirect costs. The that practitioner is working for a cardiac
exceptions for some specialties, there commenter encouraged us, along with or thoracic surgeon. Even this simplified
generally appears to be stability in the our contractor, to examine this issue in example presents a dilemma, because it
relative practice expense per hour detail. would be unclear whether to adjust the
among specialties in the SMS data we Response: We are reviewing issues pool of the cardiac or thoracic surgeon
are using. Indeed, there generally was related to indirect expenses with our in this instance. We believe that, even
little redistribution in payment resulting contractor. if these assumptions could be made for
from use of the latest SMS data. For 21 Comment: A commenter stated that some services, it would be difficult to
of the 35 specialties listed in Table 1 of separately billable income of mid-level make similar assumptions, for example,
the July 2000 proposed rule (65 FR practitioners should be deducted from for evaluation and management services
44203), the percent change in practice practice expenses as part of the practice when the mid-level practitioner could
expense from using the latest SMS data expense per hour calculations. The be working for one of many different
was near zero. For nine of the remaining commenter suggested that the total specialists. For these reasons, we are not
14 specialties, the impact on payments practice expense pools should be making an adjustment to the practice
was only 1 percent. For only five of 35 adjusted by the Medicare income expense pools at this time.
specialties listed was the impact on received by physicians for the work of
payments 2 percent or greater. Thus, if physician assistants and other mid-level (iii) Direct Patient Care Hours
there is year to year stability in the practitioners. The commenter indicated In our July 2000 proposed rule (65 FR
relative practice expense per hour that the pools can be adjusted easily for 44184), we discussed the many
among specialties, it will likely make cardiac and thoracic surgery because the concerns that have been raised from
little difference whether we incorporate data on billing for these mid-level various specialty societies concerning
additional practice expense data into practitioners are easily available from our calculation of direct patient care
the methodology. our data files. hours. Several previous commenters

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00015 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
65390 Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations

representing surgical specialty societies statistically limit the impact of this allowed only for emergency department
have raised concern that the hours variable. While one commenter services that are furnished by practices
computed for their specialties have been recommended that we use the average in areas that have a disproportionate
overstated, because non-billable hours, number of hours per week that share of uncompensated care.
such as stand-by time, have been physicians’ offices are open to calculate Response: If we were to propose any
included. In addition, commenters the practice expense per hour, another further adjustments for uncompensated
representing emergency room commenter argued that the assumption care, we would publish them in a
physicians raised the issue that the of a 40-hour work week for all proposed rule, subject to comment by
hours spent on uncompensated care specialties would result in a significant all interested parties.
were probably also included in the distortion of practice expenses per hour. Comment: A specialty society
survey responses to the detriment of this Response: We do agree that the expressed concern that, because
specialty. patient care hours data would be more podiatrists are not surveyed by SMS,
We then discussed the steps we were precise if we could ensure that there is any validation of patient care hours
taking to improve the future accuracy of a standard definition understood across performed by our contractor would not
these data. We recommended more specialties, so that non-billable hours apply to podiatry. This commenter also
precise wording for future survey would not be included in the data. As stated that the specialty society has
questions so that only the appropriate discussed in the July 2000 proposed shared with us two of the society’s own
practitioner hours are included. rule (65 FR 44185), we suggested adding surveys containing patient care hour
We also discussed the second draft a clarifying definition of hours to be data, and requested that we either
report issued by our contractor, entitled included to any future multi-specialty validate and use this data or take
‘‘Validating Patient Care Hours Used in practice expense surveys. In addition, responsibility for collecting this data.
HCFA’s Practice Expense we referred to the work our contractor Response: We understand the points
Methodology.’’ This report, which is on is doing to validate the patient care that are made by this commenter and
our homepage under the title hours; one of the tasks will be a will consider this further if we make
‘‘Validating Patient Care Hours,’’ comparison between the SMS hours adjustments to the patient care hours. In
explores alternative methods that we data and the Harvard/RUC physician addition, now that a process and criteria
might use to validate the time data time data. Once this analysis is have been spelled out for the
collected by the SMS survey. We have completed, it could form a basis for submission of supplementary practice
extended The Lewin Group’s contract so deciding whether any adjustment to the expense data, the specialty society can
that, among other refinement tasks, the SMS data is either advisable or also submit additional survey data that
above validations can be performed. We workable. As for the recommendations should include information on
also solicited comments and suggestions that we use either a standard time for all podiatrists’ patient care hours.
as to other steps we could take to verify specialties or the actual time the
(c) CPEP Data
and improve the accuracy of the physicians’ offices are open, we believe
specialty-specific patient care hours. these recommendations stem from the (i) Relative Value Update Committee’s
Comment: We received several mistaken impression that a specialty Practice Expense Advisory Committee
comments, primarily from surgical that actually works longer billable hours (PEAC)
specialty societies, reiterating the is somehow disadvantaged by our
concerns about patient care hours 1999 RUC Recommendations on CPEP
methodology. First, we believe that
discussed in the July 2000 proposed Inputs
some specialties do put in more billable
rule. In particular, commenters urged hours per week than other specialties, The PEAC, a subcommittee of the
that we find a way to identify non- and using a standard number of hours RUC, held its initial meetings last year
billable hours, such as down-time for all specialties would thus be to begin to refine the clinical staff,
between surgeries, stand-by time, phone inaccurate and inequitable. Second, supply and equipment inputs for
calls, ‘‘curbstone’’ consultations, and while it can be argued, as some physician fee schedule services. In the
uncompensated care, so that these non- commenters claimed, that most practice November 1999 final rule (64 FR 59394),
billable hours can be subtracted from expense costs are generally incurred we responded to the RUC
the specialties’ direct patient care hours. during the hours the physician’s office recommendations for the refinement of
In addition, several commenters raised is open, we do not have a two-tiered the direct inputs for 65 codes originally
the concern that the SMS survey data on system of payment in which we pay less reviewed by the PEAC and subsequently
patient care hours varies considerably for surgeries performed at 6:00 a.m. than approved by the RUC and noted that our
by specialty. we do for those performed during office actions on all of the recommended
The comments also contained a hours on the grounds that the earlier inputs were subject to comment. We
number of recommendations. One procedure somehow incurs less practice received the following comments on our
commenter suggested that we could use expense. Rather, we average the revisions to the RUC recommendations:
a blend of the all-physician and the payments across each service, regardless Comment: One specialty society
specialty-specific hours. A specialty of the time it is performed. Likewise, the questioned the removal of lysol, tissues,
society, citing concerns about the practice expense per hour calculation is and biohazard bags from the supply list
variability between the SMS and the an average of the costs per hour, in for all codes, since these items represent
Harvard/RUC time data, recommended which some hours would have higher costs that physicians must pay.
that we collect information on the costs and some lower. In addition, the Additionally, one organization objected
Medicare share of practice hours in the direct patient care that takes place to our removal of self-administered
SMS to produce a check of the outside of office hours should be drugs from all codes, and another
meaningfulness of the pool allocations. reflected in increases in the utilization society, as well as the RUC, objected to
Another specialty society, claiming that data for that specialty that, in turn, the removal of betadine from the
the SMS data on patient care hours are increases the practice expense cost supplies recommended for the post-
sure to be imprecise, urged us to use a pools for the same specialty. procedure period.
standardized number of hours in the Comment: One commenter urged that Response: We believe that the
practice expense calculation or to any uncompensated care adjustment be removal of such items as tissues, lysol,

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00016 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations 65391

and biohazard bags will help simplify inputs for these services. To ensure that Moreover, the PEAC is currently
the refinement of the CPEP supply data the appropriate revisions are made to working on establishing a standardized
without having a noticeable impact on the supply lists, we need specific methodology for refining the pre- and
the payment for any service. We recommendations from the RUC or the post-procedure clinical staff times. This
removed the costs of these minor relevant specialty societies. code, like all other surgical codes
supplies from the overall CPEP supply involving pre- and post-procedure staff
CPT Code 17304 Through 17310, Chemo
list either because of the difficulty in time will undergo further refinement.
Surgery (Mohs’ Micrographic
measuring their use or because the We are not changing the clinical staff
Technique) [First and Subsequent
supplies were not fully used up during times now, but will review them upon
a single procedure. Throughout the receipt of the PEAC recommendations
supply data, the quantities for biohazard Comment: A commenter representing for pre- and post-procedure time for
bags and tissues were reported Mohs surgeons, while acknowledging surgical procedures in general.
incorrectly; for example, codes were the revisions made in the final rule to
the lists of supplies, indicated that we CPT Ophthalmology Codes 65855,
assigned 5 boxes of tissues or 250 66170, 66172, 66821, 66984, 67036,
tissues when the intention was to assign erroneously omitted some supplies from
the updated list. The commenter 67038, 67039, and 67040
5 single tissues at a cost of 5 cents. The
PEAC/RUC has since extended this provided information on the supplies Comment: Three specialty societies
simplification by eliminating paper omitted, as well as the rationale for why representing ophthalmologists and the
towels and room disinfectant from their these supplies need to be included. RUC expressed concern that we did not
recent recommendations. We proposed Response: We appreciate the detailed accept the RUC recommendation to
to eliminate the very few self- explanation regarding the use of these increase the pre-service period to 42
supplies. After review, we note that, minutes for the above CPT codes, but
administered drugs on our supply list
with few exceptions, all the supplies the rather deleted all pre-service clinical
from the CPEP data because we believe
commenter claimed were omitted are in staff time. The commenters also noted
that it is reasonable to exclude non-
fact already included in our CPEP that the statement in the November 1998
covered items in the allocation of the
database as originally recommended. final rule that we were retaining the
specialty-specific cost pools. With
We explained in the November 1999 original CPEP value of zero minutes was
respect to betadine, we note that it is
final rule that we were deleting Valium, in error for CPT codes 66170, 66172,
included in the recommendations for
which is separately billable, and 66984, 67036, 67038, 67039, and 67040
the post-surgical supply package that we
Tylenol, which is self-administrable because the CPEP panel had assigned 24
have accepted in this rule, which can be
from all codes; therefore, these drugs minutes of clinical staff pre-service
used by any surgical specialty for its
will not be included for any of these times to these codes. Commenters
codes. Therefore, we will not be adding
services. In addition, we are not requested that we accept RUC
back any of these individual supplies at
convinced that it is typical to suture the recommendations for 42 minutes of
this time.
wound after each stage of surgery, and clinical staff time in the pre-service
CPT Code 17003, Destruction by Any the commenter stated that the wound is period for all these codes because
Method, Second Through 14 Lesions not closed until it is determined that no facility-based surgical procedures
CPT Code 17004, Destruction by Any further procedures are necessary. require significant pre-service clinical
Therefore, we believe that only one set staff work.
Method, 15 or More Lesions
of sutures and suture kit are typically Response: We thank the commenters
Comment: One organization needed, which we are including in the for pointing out our inadvertent error
commented that we should have supplies only for CPT code 17304. We regarding the pre-service time in the
corrected the obvious and egregious also note that the tincture benzoin swab original CPEP data for seven of the
anomaly in these codes whereby the requested by the commenter was not above ophthalmology codes. Although
payment for destruction of 14 lesions is included in the original RUC we are not convinced that each of the
considerably higher than the payment recommendation, though we are adding codes would have as much as 42
for 15 lesions. it at this time. minutes of pre-service clinical staff
Response: We agree that the values for time, we will use this as an interim
these two codes appear anomalous. CPT Code 56340, Laparoscopy, Surgical; value for pre-service time. We
However, we do not assign practice Cholecystectomy (Any Method) understand that the PEAC and RUC are
expense RVUs to services. Rather, these Comment: A specialty society planning to develop standardized
RVUs are allocated based on the inputs representing surgeons and the RUC approaches to assign the pre- and post-
that are associated with each service. objected to the decreases we made to the surgical clinical staff times, as well as
Both of the above codes, along with CPT PEAC/RUC recommendations for the coordination of care times, across wide
Code 17001, Destruction by any method, pre- and post-service times for this CPT ranges of codes for the different global
first lesion, were presented by the code. They indicated that there were periods. These pre-service times can
dermatology specialty societies to the extensive discussions about this code at then be revisited in light of future
PEAC, but we received the PEAC/RUC meeting, and that recommendations.
recommendations only on the supplies adequate information was provided to Comment: Several ophthalmic
for these services. We accepted these support this change for pre-service time. societies opposed our decision to
recommendations in general, but The commenters also objected to our decrease the post-service clinical staff
deleted many specific supplies from elimination of the time for the second time approved by the PEAC/RUC for
CPT Code 17003 because it is an add- registered nurse in the post-service ophthalmic surgical procedures. The
on code. We have re-examined the period and requested that we provide commenter representing three
current CPEP inputs for CPT Code the basis for determining that this is not ophthalmic sub-specialties also stated
17001, 17003, and 17004, and believe typical practice. that we did not consider the consensus
that the inputs for labor and equipment Response: There was insufficient agreement to replace the Ophthalmic
appear to be appropriate. The source of rationale for the PEAC Medical Personnel (OMP) staff type
the anomaly seems to be in the supply recommendations transmitted to us. with the Certified Ophthalmic

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00017 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
65392 Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations

Technician (COMT) staff type for technical portion of CPT Code 85097 is consensus on the staff, supplies, and
ophthalmic procedures. Another included in payment for other services equipment that were needed for these
specialty society believed we should when this service is performed outside services.
have collapsed the two staff types into a hospital, as is increasingly occurring. Comment: The American Urological
the OMP staff type, because this was They indicated that creation of a TC Association (AUA) applauded us for our
agreed upon at the 1997 validation component for CPT Code 85097, using proposal to accept the RUC
panels. the RUC recommendations, would allow recommendations for the three heat
Response: At the time that the the laboratory that receives the therapy prostate procedures and agreed
November 1999 final rule was specimen to bill for the technical costs that all inputs are now included in the
developed, we had received a comment in preparing the slide for examination CPEP data for these services. One
from the specialty society that had by the physician, and recommended manufacturer recommended that we
presented these codes to the PEAC. This this TC component be paid under the adopt our proposal for CPT code 53850
comment described the building-block physician fee schedule. in this final rule. Three individual
approach that was used to arrive at the Response: We do not want, at this urologists and a manufacturer
post-service clinical times. time, to create a TC for a code that we commented that we should add
Unfortunately, there was a do not cover, such as CPT Code 85060. equipment, such as an autoclave, rigid
miscommunication regarding the However, as mentioned elsewhere in cystoscope, video system or ultrasound
specific building blocks that were used this final rule, we are further equipment to the equipment inputs for
to arrive at the total times, and our total considering the issue of valuing non- CPT Code 53852. The manufacturer also
times were different from those of the covered services. We will publish stated the prices in the CPEP database
RUC. We have since received a practice expense RVUs for CPT Code for the generator system and the hand
clarification from the specialty society, 85097, so that it can be paid when piece are now outdated, and included
and we are restoring the clinical post- furnished in a nonfacility setting. We the suggested current prices. Two of
service times to their recommended will use the RUC recommended inputs these commenters also included a list of
values. to calculate the practice expense RVUs. supplies, most of which are already in
There appears not be a consensus the CPEP inputs for this code.
among the ophthalmic specialty CPT 88104 Cytopathology, Fluids, Response: Because our proposal is
societies regarding which staff type to Washings or Brushings, Except Cervical
based on a recommendation from the
use for ophthalmology codes. In or Vaginal; Smears With Interpretation
RUC, and the AUA has stated that it
addition, we have not used any of the Comment: Several commenters believes the current inputs for this code
decisions from the 1997 validation pointed out that, while we accepted the are correct, we will not add the
panels in refining the practice expense RUC recommendation that included suggested equipment or supplies at this
inputs, but have accepted the RUC filter paper in the list of supplies for this time, nor change the prices for any of
recommendations for the use of the code, this was not reflected in the CPEP the equipment. However, we have
OMP staff types for the codes that have database. awarded a contract to have all of our
been refined to date. We have not Response: This item was omitted direct cost inputs re-priced and any
received from the RUC any inadvertently from the CPEP database information that is sent to us on current
recommendation regarding a global and will now be included. pricing will be forwarded to our
change in the staff type for In the November 1999 final rule, we contractor.
ophthalmology services, but would deferred action on the RUC
certainly consider any future recommendations for a few groups of Chemotherapy Procedures
recommendation from the RUC on this CPT codes on which we had significant CPT 96408 Chemotherapy
issue. questions. In the July 2000 proposed Administration, Intravenous; Push
rule (65 FR 44185), we proposed to Technique
CPT Code 85060 Blood Smear, accept two groups of CPT codes of the
Peripheral, Interpretation by Physician RUC recommendations with the CPT 96410 Chemotherapy
With Written Report and CPT Code revisions noted below, while the RUC Administration, Intravenous; Infusion
85097 Bone Marrow; Smear recommendation discussed below for Technique, Up to One Hour
Interpretation Only, With or Without the antigen service has not been The RUC had recommended 102
Differential Cell Count previously addressed. minutes of clinical staff time for CPT
In the November 1999 rule (64 FR Prostate Procedures code 96408 and 121 minutes for CPT
59397), we stated that these were code 96410. After the publication of the
professional services and, if any practice CPT 52647 Non-Contact Laser November 1999 final rule we met with
expenses were incurred, they could be Coagulation of Prostate, Including representatives of the American Society
reported using other applicable codes. Control of Postoperative Bleeding, of Clinical Oncology (ASCO) and
Therefore, we removed all practice Complete (Vasectomy, Meatotomy, discussed the society’s breakdown by
expense inputs for these two codes. Cystourethroscopy, Urethral Calibration specific tasks of the above staff times.
Comment: Two specialty societies and and/or Dilation, and Internal Included in this breakdown were 20
the RUC requested that we use the Urethrotomy Are Included) minutes for pre- and post-procedure
recommendations of the RUC to CPT 53850 Transurethral Destruction education and 15 minutes for three
establish a TC for CPT Code 85060, even of Prostate Tissue; by Microwave phone calls after each visit.
though we would not use the RVUs for Thermotherapy Because we believed that the times for
payment purposes, because other payers patient education and phone calls
are increasingly using our RVUs to CPT 53852 Transurethral Destruction should be averaged over the whole
establish fees. The commenters also of Prostate Tissue; by Radiofrequency course of chemotherapy treatment, and
stated that the interpretation of blood Thermotherapy because there appeared to be some
smears can require additional slides and We discussed the inputs for these duplication in the pre- and post-
services. Commenters did not agree that codes at length with the relevant procedure education tasks, we reduced
the activity associated with the specialty society, and arrived at a both the patient education and phone

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00018 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations 65393

call times by 5 minutes. Therefore, we per vial, even if more than ten doses are 2000 RUC Recommendations on CPEP
proposed 92 minutes of clinical staff obtained from the vial. Furthermore, Inputs
time for CPT code 96408 and 111 when a physician dilutes a multidose
minutes for CPT code 96410. We believe that the recommendations
vial (for example, by taking a one cc
Comment: ASCO objected to the 10- received this year from the PEAC/RUC
aliquot from a multidose vial and
minute reduction of the clinical staff for the refinement of the CPEP inputs
mixing it with nine cc’s of diluent in a
time for CPT 96408 and 96410. The for existing codes mark a positive step
new multidose vial), Medicare should
commenter argued that the original RUC in the CPEP refinement process. We
not be billed an additional amount for
recommendation was reasonable and received recommendations for clinical
these diluted doses for CPT 95165. The
appropriate for both services and should staff, supply and equipment inputs for
additional clinical staff and supply costs
be adopted. The comment also objected 49 CPT codes, and for the supply and
for preparing such a diluted vial are
to our revision of a RUC equipment inputs for four additional
minimal, because allergens represent
recommendation unless we have a services. But the significance of the
over 80% of the direct costs of preparing
concrete reason to do so. recommendations goes beyond the
a multidose vial. In a diluted vial there
Response: Upon reviewing the times number of codes that were refined. First,
are no associated allergen costs, since
the RUC has since recommended for included in these recommendations
they have already been billed in
patient education and post-visit phone were the refinements for the 15 major
preparation of the initial vial. Therefore,
calls for comparable services, we are evaluation and management (E/M)
we expect a maximum of ten doses to
adding the 5 minutes we had removed codes. These 15 codes represent over
be billed for each multidose vial. If
from both patient education and phone 25% of the payments made under the
fewer doses are prepared from this vial,
calls in the proposed rule. We will now physician fee schedule. This was a
a dose number less than ten per vial
use the RUC-recommended total times breakthrough not only because the
should be billed.
of 102 minutes of clinical staff time for clinical staff times for these codes had
The practice expense inputs per one
CPT code 96408 and 121 minutes for previously been a point of major
cc dose are as follows:
CPT code 96410. We believe that the contention, but also because agreement
total time is consistent with subsequent Clinical Staff: 2.2 minutes on the inputs for E/M services may
recommendations that we are accepting, Supplies: Allergen $6.05 make it easier in the future to refine the
though as the PEAC and RUC continue 0.5 needles and syringes post-surgical visits for thousands of
to develop standardized times for 0.1 vial and cap services. Second, the PEAC/RUC
clinical staff functions, all previously one alcohol pad approved supply packages for three
valued codes are subject to possible 1 pair of nonsterile gloves specialties: obstetrics-gynecology,
review. ophthalmology and neurosurgery; as a
If multiplied by ten, the inputs
result, the supply inputs for hundreds of
CPT 95165 Allergen Immunotherapy correspond to the total practice expense
codes are now refined. We also
The RUC did not forward any of a ten cc vial from which ten doses of
understand that the PEAC will be
recommendations on the specific inputs one cc each are administered.
developing further supply packages and
required to perform the above service. Commenters recommended that a
is also setting up workgroups to
However, we did receive a typical ten cc multidose vial contains
determine approaches to standardizing
recommendation about the five antigens and no diluent and that the
pre- and post-procedure clinical staff
interpretation of the meaning of a dose total number of needles and syringes for
for purposes of calculating the practice the ten cc vial is five. The cost data for
allergens was obtained from catalogue We have reviewed the submitted RUC
expense RVUs for this service. Because recommendations and have accepted all
we did not believe the recommendation information and is based on the typical
practice of using standardized extracts of them with only two minor revisions.
resolved the ambiguity and confusion in In order to be consistent with a revision
the medical community surrounding when available.
In view of the clarification we have made previously in the November 1999
this issue, we did not accept this final rule, we have deleted the skin
recommendation in the July proposed made regarding practice expense inputs,
we will revise Section 15050(B)(7) of the marking pen when it appears in a
rule. Since that time, we have received recommended supply list because it is
clarifying comments from relevant Medicare Carriers Manual. In May 1998,
we changed the language of that section, not practical to allocate its use to
specialties on both the definition of individual procedures. In addition, for
dose and the practice expense inputs to in part, to clarify our payment policy for
antigen preparation. At that time we the ophthalmology codes that were
use for this code. refined before the supply packages were
The practice expense inputs have stated, ‘‘A dose of code 95165 is the
total amount of antigen to be adopted, we have substituted the
been analyzed and adjusted so that they
administered to a patient during one ophthalmology visit supply package as
now correspond to the practice expense
treatment session, whether mixed or in appropriate. If future decisions are made
of preparing a one cc dose from a ten cc
separate visits.’’ Two examples of on standard clinical staff times, all of
(ten dose) vial. The practice expense
antigen preparation and administration these refined codes can be revisited to
inputs for CPT code 95165 are based on
follow immediately after this language. determine whether any further
an assumption that ten doses are
refinements would be appropriate.
typically included in each vial. Payment We will revise this section of the
will be based on a maximum of ten carrier manual to define a dose as a one Following is a list of the CPT codes
doses per multidose vial. The practice cc aliqout from a single multidose vial. that were included in the PEAC/RUC
expense RVUs for preparing a ten dose With this clarification physicians will recommendations: (The complete
vial will remain the same, even if be able to bill Medicare for each dose PEAC/RUC recommendations and the
twenty doses are obtained from the vial prepared in each multidose vial. We revised CPEP database can be found on
(for example, if the physician plan to issue new instructions to the our website. See the Supplementary
administers 0.5cc doses, instead of one carriers and update the carrier manual Information section of this rule for
cc doses). Therefore, Medicare should to ensure that appropriate payment is directions on accessing our web site.)
be billed for a maximum of ten doses made as of January 1, 2001. CPT 57452 Examination of vagina

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00019 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
65394 Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations

CPT 57454 Vagina examination and implement the RUC CPEP the CPEP data. Commenters have since
biopsy recommendations on a rolling basis, or noted that the clinical staff times
CPT 57500 Biopsy of cervix. whether all changes will be made at reported by some CPEP panels for pre-
CPT 59000 Amniocentesis once. and post-service times for 0-day global
CPT 62270 Spinal fluid tap, diagnostic Response: Unless we announce a services performed in the office were
CPT 65730 Corneal transplant change in approach, we plan to deal recorded in the intra-service field in the
CPT 67311 Revise eye muscle with the RUC’s recommendations on a CPEP database. These times were,
CPT 67800 Remove eyelid lesion rolling basis as we receive them. therefore, deleted along with the times
CPT 67961 Revision of eyelid Comment: A commenter representing for the use of clinical staff in the facility
CPT 90471 Immunization admin* three ophthalmology sub-specialty setting.
CPT 90472 Immunization admin, each societies expressed disappointment in In the July 2000 proposed rule (65 FR
add* our belief that it is preferable to have a 44186), we stated that these data are not
CPT 90782 Injection, sc/im multi-specialty agreement on changing comparable to the data we excluded for
CPT 92270 Electro-oculography the CPEP data, rather than accepting the clinical staff used in the facility setting.
CPT 92275 Electroretinography recommendations of a single group. The
CPT 92582 Conditioning play We reviewed the ‘‘CPEP Recorders’
commenter argued that there is little or Notes Files’’ compiled for each CPEP
no added value from such multi- panel by Abt Associates, Inc., the
CPT 94621 Pulm stress test/complex
CPT 95812 Electroencephalogram specialty review when the impact of the contractor managing the CPEP panels.
(EEG) changes is limited to a single specialty When the notes indicated that clinical
CPT 95822 Sleep and when members of other specialties staff estimates were for activities
electroencephalogram have no additional clinical knowledge. performed in physicians’ offices, we
CPT 95829 Surgery electrocorticogram Response: We strongly disagree with proposed to reinstate the time data for
CPT 95830 Insert electrodes for EEG this comment. We have found that the 0-day global services.
CPT 95861 Muscle test, two limbs input and recommendations of the RUC Comment: Many medical societies
CPT 95863 Muscle test, 3 limbs play a crucial role in the practice representing specialists such as
CPT 95864 Muscle test, 4 limbs expense refinement. Also, because there gastroenterologists, internists,
CPT 95867 Muscle test, head or neck are many codes that are shared across a rheumatologists, cardiologists,
CPT 95868 Muscle test, head or neck number of specialties, changes in osteopaths and podiatrists, as well as
CPT 95870 Muscle test nonparaspinal payment for even a specialty-specific the AMA, expressed strong support for
CPT 95903 Motor nerve conduction service can affect the payment of the this proposal to reinstate the pre- and
test shared services that the specialty post-procedure clinical staff time in the
CPT 95925 Somatosensory testing performs. Therefore, we believe that it is office for 0-day global services. One
CPT 95926 Somatosensory testing fair and equitable to have a multi- reason given in the comments for this
CPT 95930 Visual evoked potential specialty consensus on these changes. In support is that this time for staff in the
test addition, we have found, in our role as office is not comparable to the data
CPT 99141 Sedation, iv/im or inhalant observers at RUC meetings, that RUC excluded for clinical staff used in the
CPT 99142 Sedation, oral/rectal/nasal members, of whatever specialty, ask facility setting.
CPT 99201 Office/outpatient visit, new pertinent questions and make clinically Response: We are pleased that all
CPT 99202 Office/outpatient visit, new commenters supported this proposal,
relevant observations.
CPT 99203 Office/outpatient visit, new Comment: A specialty society and we are implementing this
CPT 99204 Office/outpatient visit, new refinement in this rule.
representing many medical specialties
CPT 99205 Office/outpatient visit, new Comment: An organization
CPT 99211 Office/outpatient visit, est recommended that we should use
panels, corresponding to the refinement representing cardiologists stated, in a
CPT 99212 Office/outpatient visit, est comment on the November 1999 final
CPT 99213 Office/outpatient visit, est panels we use for work, to make
recommendations on code-level rule, that we should enlist the assistance
CPT 99214 Office/outpatient visit, est
CPT 99215 Office/outpatient visit, est refinements that are submitted to us. of medical specialties to identify codes
CPT 99241 Office consultation Response: We certainly do not rule for which clinical staff are used in the
CPT 99242 Office consultation out the use of such refinement panels physician’s office during the intra-
CPT 99243 Office consultation for code-level practice expense service period for facility services. In a
CPT 99244 Office consultation recommendations when and if such comment on the current proposed rule,
CPT 99245 Office consultation panels would be necessary and useful. this society agreed with our proposal to
CPT 95813 Electroencephalogram We have used these panels for work add some pre- and post-service clinical
(EEG) RVU refinement in those cases when we staff time to 0-day global services and
CPT 95816 Electroencephalogram have not accepted the RUC listed several 0-day cardiology services
(EEG) recommendations on a number of codes for which it recommended the addition
CPT 94060 Evaluation of wheezing and subsequently have received of clinical staff time.
CPT 95921 Autonomic nerv function comments disagreeing with our actions. Response: In this proposal, we added
test Because we have made so few revisions only clinical staff time in the facility
CPT 95922 Autonomic nerv function in this current final rule to the PEAC/ setting for those 0-day services when the
test RUC recommendations for practice CPEP recorder notes specified that the
CPT 95923 Autonomic nerv function expense inputs, there may be no need time was for pre- and post-service time
test for practice expense panels next year, for staff in the office. We believe that
*Note: These are noncovered under the although we will consider this issue. this is appropriate because these CPEP
Medicare physician fee schedule. data are as valid as all other non-refined
(ii) Clinical Staff Time CPEP data. We also believe that changes
Other Comments on Refinement of In the November 1999 final rule (64 to the CPEP data for this pre- and post-
CPEP Inputs FR 59399), we removed estimates of all service clinical staff time should go
Comment: One commenter asked that clinical staff time allotted to the use of through the same refinement process as
we clarify whether we plan to clinical staff in the facility setting from other desired changes and that any

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00020 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations 65395

group recommending the addition of stated that the clinical staff time should clinical staff time. First, we believe that
such time should present this issue to be removed for services furnished in the we already pay the facility for the
the PEAC/RUC for refinement. We also facility until the PEAC/RUC can clinical staff needed for patient care.
understand that the issue of determine that the time for these Much of what is claimed as physician’s
‘‘coordination of care’’ clinical staff time services is typical and not duplicative of clinical staff time in the facility is either
is one that the PEAC may address across physician work. Several commenters separately billable (as illustrated by the
the board at some future meeting. In again raised the argument that the BBA survey submitted by the commenter) or
addition, from the description of the prohibits us from excluding these is accounted for in the work RVUs.
staff duties for the codes listed by the clinical staff costs because the BBA Furthermore, by law, the hospital itself
commenter, it is not clear that this staff requires us to recognize all costs, not must furnish all services and items to a
is in the office, rather than in the facility just those that can be tied to specific hospital patient, either directly or under
performing facility nursing functions. procedures. Many organizations arrangement. (For a more detailed
Therefore, we will not be making these reiterated the claim that the practice of description of our rationale for this
changes at this time. taking staff to the hospital is either policy, see the November 1999 final rule
Comment: An emergency physician typical or prevalent in their specialties. (64 FR 59402).)
organization recommended that we not However, only the specialty society As to the recommendations made by
limit this proposal to 0-day global representing thoracic surgeons the commenters, we agree that it would
period services and submitted the CPEP submitted any additional information to be desirable to remove costs associated
recorders’ notes for emergency room support this claim. The STS surveyed with these mid-level practitioners from
visits, CPT codes 99281 through 99285. their members in July 2000,and reported the SMS data as well. This would
The notes indicate that the CPEP panel that 74 percent of the respondents said answer the concern raised by another
added 3 minutes of pre-service time and they employ clinical staff who assist in commenter that removing the clinical
4 minutes of post-service time for office the hospital, though more than half staff from the CPEP data introduces
staff involved in admissions to the report that they receive Medicare further inconsistency with the SMS
emergency room. The commenter payment for some of these personnel. data. It is for that reason that we had
recommended that this time be Commenters made the following recommended to the AMA that several
reinstated for these emergency room recommendations: specific questions be added to the SMS
visit codes. Several organizations contended that survey to capture the needed
Response: These emergency room hospitals no longer supply the staff to information on this clinical staff issue,
visits have an XXX global period. By the furnish adequate care. In relation to this and we anticipate that we will, in the
current definition, XXX services do not point, two commenters recommended future, be able to obtain such data.
include pre- and post-service times. that the issue of cost shifts between Although we would be interested in
Before implementing this specific hospitals and other providers is one that receiving data on the cost shifts between
recommendation, we hope to receive we should not ignore, and, if there is hospitals and other providers, we
input from the RUC/PEAC on the any double payment, Part A payment to believe that the suggested use of a
general issue of appropriate pre- and the affected hospitals should be modifier for this purpose would be
post-staff times for the different global adjusted. extremely difficult to implement and
periods, in order to ensure consistency Another specialty society also burdensome for the practitioner.
in our approach to this issue. recommended that we establish a First, however, we must clarify that,
In the November 1999 final rule (64 modifier to allow for documentation of even if the practice of bringing
FR 59399) we finalized our decision to and payment for non-physician clinical physician staff to the hospital pre-dates
remove from the CPEP data all clinical staff who furnish services in a facility the advent of the hospital prospective
staff times associated with physician’s setting. This modifier would indicate payment system, any costs associated
staff used in the facility setting. We whether there is a physician practice with such a practice were explicitly
implemented this policy for the expense or a hospital practice expense included in the hospital Diagnosis
following reasons—(1) We should not that has been transferred to the Related Group (DRG) payments in the
pay twice for the same service; (2) It is physician practice, to ascertain whether September 1, 1983 interim final rule
not typical practice for most specialty payment should come from Medicare with comment and in the January 4,
societies to use their own staff in the Part A or Part B. 1984 final rule. These rules reference
facility setting; and (3) Inclusion of One organization recommended that section 1862(a)(14) of the Act, and the
these costs is arguably inconsistent with the SMS data be adjusted by the income discussion makes clear that, with
both the statute and Medicare received for the work of physician certain limited exceptions, all
regulations. In response to the assistants. nonphysician services furnished to
November 1999 final rule, we received Response: We have considered all the hospital inpatients are to be paid under
many comments on this final decision, comments that we have received on this Part A. The exception provided that, for
which, for the most part, reiterated issue, both on the July 22, 1999 any cost reporting period beginning
comments that had been made on the proposed rule and the November 1999 before October 1, 1986, a hospital that
original proposal. final rule. Though many of the has followed a practice, since before
Comment: Although several primary commenters raised interesting points, October 1, 1982, of allowing direct
care groups expressed support for this there were neither new arguments nor billing under Part B to an extent that
decision, most of the commenters evidence presented that would cause us immediate compliance with the
objected to the exclusion of this clinical to delay or abandon this policy. While bundling requirements would threaten
staff CPEP data. Many of these we particularly appreciate the effort the stability of patient care, could
organizations urged us to postpone the undertaken by the thoracic surgeons to continue to bill under Part B. There is
implementation of this policy and to develop data on the prevalence of their no indication that the waiver was
collect additional information before use of clinical staff in the hospital, the extended. In response to a comment, we
making a decision on how to treat these survey addresses only the question of stated the following: ‘‘In order for a
costs. However, taking the opposite typicality. As stated above, there are two payment system that is based on a
approach, a primary care organization other reasons why we eliminated this national average rate for a particular

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00021 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
65396 Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations

diagnosis to succeed, it is vital that the deleted if they are separately billable for process of refining the CPEP inputs
services and supplies included in the these services and left in the CPEP data while not leading to a substantive
payment be essentially the same in if they are not. This commenter also distinction in how we value services.
every hospital. If the statute had not stated that the soft goods, such as Therefore, we proposed to combine both
included the rebundling provision, it stockinette, that we propose to delete do categories of equipment into a single
would have been possible for hospitals not currently have a HCPCS code, and ‘‘equipment’’ category, assuming an
to collect the full prospective payment requested that these supplies remain on average 50 percent utilization for all
rate for inpatient services and, at the the CPEP list until a separate code is equipment.
same time, reduce their costs by having established. We also proposed to delete from the
outside providers and suppliers furnish Response: We appreciate the support CPEP data equipment that is not used
many of the necessary services and bill expressed for our proposal. Consistent typically with any service, but is on
Part B.’’ Furthermore, these rules state with the statute that limits separate ‘‘standby’’ for many services, or that is
that, to calculate the PPS standardized payment for casting supplies only to the used for multiple services at the same
amounts, base year costs were adjusted treatment of fractures and dislocations, time. The following is the list of
‘‘to include the costs of services that we are not deleting these supplies from equipment that we proposed to delete
were billed under Part B of the program either of the two lists of additional from the CPEP inputs of all services:
by another provider or supplier during codes supplied in the above comment. autoclave, wheelchair, refrigerator, film
the base period but will be billed under Also, we will delete soft goods, such as file cabinet, hazard material spill kit,
Part A as inpatient hospital services stockinette, from the CPEP data for the embryo freezer, water system,
effective October 1, 1983.’’ appropriate codes, because these are flammable reagent cabinet, utility
We do agree that it would be helpful casting supplies that may be separately freezer, ultra low temperature freezer,
to determine whether hospitals are still billed. We will, however, also request acid cabinet, bulk storage refrigerator,
providing the staffing that is assumed in that HCPCS codes be developed for abortion clinic security system, abortion
their DRG payments. To this end, we these items. Therefore, we will clinic security guard, gomco suction
have requested that the Office of implement the policy as proposed. machine, doppler, laser printer, lead
Inspector General conduct an Comment: A commenter representing shielding, defibrillator with cardiac
independent assessment of staffing dermatologists sought clarification on monitor, blood pressure/pulse oximetry
arrangements between hospitals and whether the unna boot would be monitor, blood pressure monitor,
thoracic surgeons. separately billable. The commenter printer, crash cart—no defibrillator, and
stated that the unna boot is not in the smoke evacuator.
(iii) Supplies
list of supplies to be deleted from the The following is a list of equipment
In the November 1999 final rule, we CPEP data, but CPT code 29580, that we proposed to delete as ‘‘standby’’
deleted certain casting supplies from the Application of paste boot, falls within equipment for most codes, but that we
CPEP data for the casting and strapping the range of codes listed under this believed typically may be used with a
CPT codes 29000 through 29750. In the proposal. designated subset of procedures:
July 2000 proposed rule, we identified Response: We are not deleting the X-ray view box—four panels (retain
additional CPT codes for the treatment unna boot from CPT code 29580, when currently in the CPEP data for
of fractures/dislocations and additional because this code can be appropriately codes in the range CPT codes 70010
casting and splinting supplies that are used for cases other than fractures, and through 79999).
separately billable under section in those cases the supply is not ECG machine—3 channel (retain
1861(s)(5) of the Act. Therefore, we separately billable. when currently in the CPEP data for
proposed the removal of inputs for Comment: One supplier of casting CPT codes 93000 through 93221).
fiberglass roll, cast padding, cast shoe, supplies agreed with our proposal to Pulse oximeter (retain when currently
stockingnet/stockinette, plaster bandage, delete these casting supplies from the in the CPEP data for CPT codes 94620,
Denver splint, dome paste bandage, cast CPEP data, but suggested that we 94621, 94680, 94681 and 94690; 94760
sole, elastoplast roll, fiberglass splint, include their product, Procel cast liner, through 94770, 95807 through 95811
Ace wrap, Kerlix, Webril, malleable on this list as well, to clarify that it is and 95819).
archbars, and elastics from the following separately billable. ECG/blood pressure monitor—3
CPT codes: 23500 through 23680; 24500 Response: The purpose of the channel (retain when currently in the
through 24685; 25500 through 25695; proposal was not to list all the casting CPEP data for CPT codes 43200 through
26600 through 26785; 27500 through supplies that could be separately 43202 and 43234 through 43239).
27566; 27750 through 27848; 28400 billable, but rather to delete from our Cardiac monitor (retain when
through 28675, and 29000 through CPEP input database any casting currently in the CPEP data for CPT
29750. supplies that are currently listed. codes 31615 through 31628).
Comment: Several specialty societies, Because the Procel cast liner is not ECG-Burdick (except for HCPCS code
representing orthopedic surgeons, currently in our database, it does not G0166).
podiatrists, and occupational therapists need to be deleted. Comment: All the specialty societies
supported our proposal to delete casting that commented on these proposals
supplies from the CPEP inputs for all (iv) Equipment were supportive of what one commenter
applicable fracture management and We currently use the original CPEP characterized as ‘‘HCFA’s efforts to
cast/strapping application procedure definitions for equipment that streamline the treatment of medical
codes for which these supplies are distinguish between ‘‘procedure equipment’’ and agreed that the changes
separately billable. The orthopedic specific’’ equipment and ‘‘overhead’’ will facilitate the refinement process.
surgery specialty society comment also equipment. Under the ‘‘top-down’’ One of these commenters stated that a
included a list of non-fracture/ methodology, the CPEP inputs are used standardized utilization rate overstates
dislocation codes for which it only as allocators of the specialty- the use of some equipment and
recommended deleting casting supplies specific practice expense pools, and we understates it for others and
and another list of non-fracture codes believe the distinction between types of recommended that we continue to seek
from which the supplies should be equipment has served to hinder the reliable data on this issue. Another

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00022 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations 65397

commenter recommended that we need included in the SMS cost pools for each The suction machine should be
to provide clear and specific criteria for specialty. However, we believe this maintained for procedures that include
including medical equipment in the proposal simplifies the refinement of evacuation of the uterus, CPT 58120,
direct practice expense inputs, and gave equipment without introducing new 59140, 59160, 59812, 59820, 59821,
three possible options—(1) equipment problems. First, it is not clear whether 59840, 59841.
used primarily for a specific procedure much of this equipment, such as laser Response: We will retain the doppler,
or group of procedures; (2) all printers, lead shielding, refrigerators monitor and suction machine for the
equipment used for a specific and freezers, cabinets, water systems, recommended services. Because these
procedure; or (3) all equipment that security systems, smoke evacuators and were the only code-specific changes
typically must be available when a hazard material spill kits, would have recommended in comments on our
specific procedure is performed. been included as medical equipment or equipment proposals, we will be
Response: We agree that clear criteria as indirect costs in the SMS survey. implementing our proposals with only
are needed for including equipment in Second, stand-by equipment, such as the above changes.
the inputs for a given procedure. The crash carts, wheelchairs and ECG Comment: The American Academy of
major criterion used for clinical staff machines, would often be available for Dermatology (AAD) wanted clarification
time and supplies is that the suggested more than one procedure at a time. on whether we are proposing that
input must be typically used in the Allocating costs of these items for every dermatology-related standby equipment
performance of a service to be included service for which they are available, be assigned to the overhead category,
as a direct practice expense. We believe rather than for services for which they because the specialty gains one percent
that the same criterion should be are typically used, can mean that we are on the overhead proposal and loses one
applied to equipment. This criterion can allocating more than their actual costs percent on the standby equipment
be applied more clearly than the other and thus overstating their value. Third, proposal.
options mentioned by the commenters, the inclusion of the costs of equipment Response: We are proposing to delete
and, thus, should result in more that is not typically used in a service from the inputs the identified ‘‘standby’’
consistent assignment of equipment means that we have different criteria for equipment from those codes for which
across all services. Regarding utilization equipment than we do for other direct the equipment is not typically used. It
rates, we did solicit information on inputs. Fourth, most of this equipment is a coincidence that the impact came
specific equipment utilization rates in is relatively low cost, which is one out as it did.
the 1997 Notice of Intent to Regulate, reason the impacts of this proposal are Comment: One primary care specialty
but very little hard data were submitted. not significant. We also want to clarify society recommended that we propose a
For most specialties, equipment costs that combining all equipment into one methodology in the 2001 proposed rule
are a very small portion of total practice category does not eliminate from the for the use of an alpha-numeric code for
expense, averaging less than 5 percent practice expense calculations any of the billing unusual equipment costs
of the total practice expense per hour for overhead equipment, such as the most associated with a procedure that are not
the ‘‘all physicians’’ category. In expensive radiology equipment, that is properly captured in the practice
addition, for most equipment, a change typically used for a given service. expense data.
in the utilization rate would produce a Response: We will certainly consider
Comment: Societies representing
negligible difference in the practice this idea, although we foresee many
various imaging specialties requested
expense RVUs for any service. policy and operational difficulties in
clarification on the doppler that was
Therefore, with perhaps a few specific implementing this recommendation.
included in the list of potentially (v) CPEP Anomalies
exceptions, and because of the apparent
deleted items, because, if this is an In the November 1999 final rule, we
difficulty in obtaining reliable objective
image-directed spectral doppler, it made corrections to the CPEP data for a
data, we expect that this issue will not
should not be deleted. One of these number of codes when we learned that
be a high priority issue during the
commenters supported the elimination the data contained errors and anomalies
refinement process.
Comment: One specialty society of x-ray boxes because they are no that we could easily correct. In the July
agreed that it is appropriate to capture longer typically used in current 2000 proposed rule, we listed other
as indirect expense the costs of the radiology practice. egregious errors and anomalies that we
equipment that we have proposed to Response: The doppler we are are proposing to correct. As we have
delete. The specialty society expressed deleting from all but the relevant previously stated, though certain
concern that the SMS survey would not procedures is a hand-held doppler, with revisions may be made now, all practice
include most of this equipment as a cost of $1350, that can be used on expense inputs for these codes are still
indirect expense, disadvantaging certain obstetric patients, not the ultrasonic subject to further comment, refinement,
specialties who have relatively higher doppler at $155,000. and potential PEAC and RUC review
costs for indirect or stand-by equipment. Comment: A society representing and recommendations. We received the
Other commenters questioned how the obstetricians and gynecologists following comments on our proposed
costs of stand-by and multiple-use recommended that the following corrections.
equipment can be reflected if the equipment that we proposed deleting Comment: A major primary care
equipment is not included in the from all services be retained for specific organization agreed with our decision to
calculation of practice expense. One codes: correct major errors in the CPEP practice
society stressed that, because of the high The doppler should be retained for expense data that had been identified by
costs of radiology equipment, it is the prenatal codes CPT 59400, 59425, specialty societies. Another association
critical that overhead costs are 59426, 59510, 59610 and 59618. stated appreciation for our correction of
accounted for. The blood pressure and pulse the supply list for CPT code 68761 to
Response: The commenter raised a oximetry monitors should be retained reflect the cost of a punctal plug.
valid point about the relationship for procedures requiring anesthesia or Response: We are pleased that there
between the deleted ‘‘indirect’’ sedation, CPT 58555, 58558, 58120, was no disagreement on any of the
equipment and the SMS cost pools. The 58800, 59140, 59160, 59812, 59820, proposed revisions we made in the
costs for this deleted equipment are 59840 and 59841. November 1999 final rule and the July

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00023 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
65398 Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations

2000 proposed rule to correct egregious with incision, fulguration, or resection CPT 90857 and 90853, and we will
errors and anomalies in CPEP data, with of congenial posterior urethral valves, or make those increases in physician time
the exception of those discussed below. congenital obstructive hypertrophic as well.
Therefore, we will be implementing all mucosal folds, even though the practice Comment: The association
other changes at this time. expenses are similar. The commenter representing psychiatrists also
Comment: Two specialty societies, also noted that the supply cost for a commented that the clinical staff times
representing obstetrics and family double stent (CPEP supply code 93119) for psychotherapy with E/M services are
practice, pointed out that we proposed should be decreased from $359 to $150. underestimated and questioned why we
to crosswalk the CPEP inputs for CPT Response: We do not view a request did not correct this as an egregious
59618, which includes antepartum care, to increase the number of post-operative error.
delivery and postpartum care, from CPT visits as a correction of an egregious Response: We included as egregious
59410, which only includes delivery error, because it is not clear without errors and anomalies only those
and postpartum care. They supporting evidence that the current instances where there was a clear error
recommended that we change the number of post-operative visits in our or anomaly in the CPEP data and also
crosswalk to CPT 59510, Routine database is inappropriate. It would be where the correct input would be
obstetric care including antepartum most beneficial to discuss this issue obvious, without the benefit of a multi-
care, cesarean delivery, and postpartum with the RUC, which could then make specialty recommendation. We did not
care. recommendations to us. In regard to the consider the clinical staff times for
Response: The above proposed second issue, CPT 52340, a code that psychotherapy codes to fall into that
crosswalk was a typographical error. We will be deleted in 2001, is a 90-day category; in fact, we have concerns that
thank the commenters for pointing this global service, while CPT 52276 is a 0- the clinical staff time for most of the
out, and we are now crosswalking the day global service and therefore has psychotherapy codes is, in fact,
CPEP inputs for CPT 59618 from the lower practice expense RVUs. The overstated. Therefore, we believe that
inputs for CPT 59510 as requested. double stent is currently priced at this issue might better be dealt with
Comment: A specialty society $179.50. We appreciate the information initially by the RUC.
representing interventional radiologists that this may be overpriced. However, Comment: A manufacturer of
agreed that we had appropriately we have awarded a contract to have the diathermy equipment commented that
removed the clinical supplies listed in prices of all the CPEP clinical staff, the practice expense RVUs for CPT code
the facility setting for CPT codes 47510, supply and equipment inputs updated 97024, Application of a modality to one
Insert catheter, bile duct and 47511, in time for next year’s proposed rule or more areas; diathermy, are
Insert bile duct drain. They and will revise the costs at that time. If undervalued. The commenter stated that
recommended that these supplies be the society has documentation on the this payment rate will threaten the
listed in the office setting, because these correct price for this item, we will send ability of providers to make this service
are 90-day global services with two this information to our contractor. available to the Medicare population.
post-procedure visits. Comment: An association Response: In checking our direct cost
Response: We have added post- representing psychiatrists reiterated inputs for this service, neither the
procedure supplies to these two codes their concern regarding the physician clinical staff time nor the supplies seem
by crosswalking from the supplies times assigned to the psychotherapy inappropriate. The issue appears to arise
assigned to CPT code 45525, Change codes that include evaluation and from a discrepancy in the cost of the
bile duct catheter, adjusted for two post- management services (E/M). The society diathermy machine itself. The machine
visits. recommended that the times assigned to in our database is priced at $2850. The
Comment: A radiology specialty each psychotherapy E/M code be price range quoted by the manufacturer
society objected to our proposal to increased so that the total time would be is for $18,000 to $30,000. There is
crosswalk the inputs of CPT code 78206, 7 minutes more than the time assigned obviously a wide range of machines
Liver image (3D) with flow from the to the corresponding psychotherapy available, and we will need to
inputs of CPT code 78205, Liver code without E/M. The commenter determine the most typical cost to a
imaging (3D). The specialty society argued that this added time would be practice. As mentioned earlier, we have
suggested that it will work with the equal to the time assigned to CPT 99211, granted a contract to re-price all of our
PEAC and RUC to determine the the lowest level office visit with an
direct cost inputs, including equipment.
appropriate additional expenses. established patient, and that this
Response: We view crosswalks of We would welcome information on this
corresponds to the adjustment made to
CPEP inputs as a temporary solution, and other equipment used by
the work RVUs for the psychotherapy
and we would welcome a practitioners and would find recent
codes with E/M services. In addition,
recommendation from the RUC. invoices particularly helpful.
the comment requested that we make
Comment: One specialty society the physician time for CPT 90847, (d) Calculation of Practice Expense
commented that they had previously Family psychotherapy (with patient Pools—Other Issues
identified inaccurate inputs, which lead present), equal to CPT 90846, Family
to anomalous RVUs that we have not yet (i) Technical Refinement to Practice
psychotherapy (without the patient
addressed. The commenter requested present) and the time for CPT 90857, Expense Pools
the status of these suggested changes for Interactive group psychotherapy, equal The Act requires payment of some
13 procedures. For 11 of these to CPT 90853, Group psychotherapy. practitioner services (services of
procedures there is a request to increase Response: We agree that an increase certified registered nurse anesthetists,
the number of post-operative office of seven minutes in the physician times nurse practitioners, clinical nurse
visits. For CPT code 52276, for the psychotherapy codes with E/M is specialists, physician assistants, and
Cystourethroscopy with direct vision reasonable, and we will make the certified nurse mid-wives) based on a
internal urethrotomy, the commenter appropriate changes in our physician percentage of the physician fee schedule
questioned why the facility practice time database. In addition, we also agree payment amount. Since the payment
expense RVUs are much lower than that the times for CPT 90847 and 90846 under the physician fee schedule for a
those for CPT 52340, Cystourethroscopy should be equal, as should the times for service performed by a mid-level

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00024 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations 65399

practitioner is required to be based on reassigning to the dominant specialty Response: These comments refer to
a percentage of the amount paid to a the small proportion of allowed services methodological issues surrounding the
physician for a service, we proposed associated with specialties not expected development of the practice expense
using only physician practice expense to perform these services. The impacts relative value units under the ‘‘top
data in determining the practice did not even approach a 1-percent down’’ methodology. We use a
expense RVUs for each practitioner increase or decrease in any scenario. combination of data on practice expense
service. Removal of the services We stated our belief that these per hour from the SMS survey, the time
performed by mid-level practitioners simulations demonstrated that the small estimated to perform individual
from the practice expense calculations percentage of potential errors in our procedures and Medicare utilization
would assist in simplifying the very large database have no adverse data to create aggregate cost pools.
methodology and would also be effect on specialty-specific practice These cost pools are allocated to
consistent with the statutory expense RVUs. Therefore, we did not individual codes. Once the costs are
requirement that we pay for their propose any further action at this time. allocated, estimates of practice expenses
services based on a percentage of the fee Comment: One surgical specialty for individual procedures are then
schedule amount. society expressed concern that we had weight-averaged by the specialties
Comment: A primary care dismissed the impact of less than 1 performing each procedure to produce
organization expressed concern that percent as inconsequential and practice expense RVUs for a procedure.
removing the services performed by encouraged us to develop a software The above commenters are concerned
mid-level practitioners from the practice program to reassign obvious errors in that this process does not result in
expense calculations might have the specialty-specific assignment of practice expense payments to each
implications that were not discussed in procedures to the appropriate specialty. specialty that equal the aggregate cost
the proposed rule. The comment pools. To the extent that there is ‘‘pool
Response: We believe that developing
encouraged us to withdraw the proposal leakage,’’ it implies that an individual
software would not be an easy solution
until there is more information and a specialty’s practice expense payments
to what we still see as an issue of little
thorough discussion of the issue. The are less than its aggregate practice
significance for the calculation of
AMA stated in its comment that it expense pool. The implication of the
practice expense RVUs. On what basis
would be difficult for us to include such comments we have received on this
do we decide what an obvious error
mid-level practitioner data since we do issue is that specialties that receive
would be? At this time, we do not have
not have reliable information aggregate cost payments that are less
policies that limit payment for given
concerning the extent to which these than the aggregate cost pools are
services to only certain physician
practitioners are self-employed or are underpaid. We disagree. As we
employed by physicians. The comment specialties, and we are not convinced
that the medical community would indicated in the November 1999 final
further noted that we have rule (64 FR 59390), we believe it is more
recommended that the AMA request in actually support our doing this. In
addition, because many services are likely that the aggregate practice
any practice expense survey the amount expense pools are overstated, rather
of revenue and patient care hours performed appropriately by more than
one specialty, on what basis would we than that aggregate practice expense
generated by mid-level practitioners. payments to a specialty are too low.
Another primary care organization decide to which specialty the services
agreed that this proposal will make the should be reassigned? Therefore, though As we indicated both in that rule and
methodology more consistent with the we would certainly want the possible in the June 5, 1998 proposed rule (63 FR
statutory requirement. error rate to be zero, at this time we do 30832), there are two potential sources
Response: The statute specifies the not plan to propose any changes in our of bias in the practice expense per hour
payment amounts for practitioners such method of handling the utilization data data that may result in an overstatement
as nurse practitioners, physician for the purposes of calculating practice of the aggregate practice expense pool.
assistants, and certified nurse expense. First, mid-level practitioners may have
specialists. Because payment for these been included in the numerator of the
(iii) Allocation of Practice Expense
practitioners is not based on the practice expense per hour calculation
Pools to Codes
calculation of their own practice even though there is generally separate
expense cost pools, we are removing In the July 2000 proposed rule, we payment for their services. Thus, a mid-
these services from the practice expense discussed the work The Lewin Group level practitioner would be analogous to
computations and will consider further had recently begun on the third phase an employee physician who also
adjustments as additional information of the project, which concentrates generates revenue and whose costs are
becomes available. specifically on evaluating the indirect not included in the practice expense
cost allocation methodology and calculation, rather than to a registered
(ii) Medicare Utilization Data considers alternatives to allocating nurse or other practitioner who cannot
We have received, in response to indirect costs by the current method. furnish a separately billable service.
previous rules, comments from several We expect their report on this analysis, Second, the mid-level practitioner’s
surgical specialties urging us to evaluate which will be placed on our website, to hours spent are not included in the
the Medicare claims data to eliminate be available soon. denominator of the practice expense per
potential errors in the specialties Comment: Two specialty societies hour calculation even though, like a
associated with each service. In the June commented that we should develop and physician, the mid-level practitioner is
2000 proposed rule, we described the implement ways to reduce or eliminate generating patient care revenues during
analyses we ran to determine whether the pool leakage that can occur in the the hours spent in patient care. To the
potential errors in the claims data have weight-averaging step of our extent that a specialty depends on the
an adverse impact on any specialty or methodology when procedures are use of mid-level practitioners, then the
merely represent ‘‘noise’’ that creates no performed by multiple specialties. One aggregate specialty practice expense
significant effect. We tested, for commenter argued that the problem is pools are likely to be overstated. Based
neurosurgery, ophthalmology and in the allocation formula that sets up the on information in our utilization data
otolaryngology, the impact of leakage, not the averaging. and comments made to us by one of the

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00025 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
65400 Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations

commenters, we believe this is the case were assigned in the zero-work pool, not in their offices, rather than in an ASC
with thoracic surgery. Rather than the increased rate in the specialty- or hospital outpatient department;
developing a process that ensures that specific pool. With regard to the • The policy allows the procedures to
aggregate practice expense payments are recommendation that the RVUs of the be furnished in a physician’s office that
equal to overstated aggregate practice remaining services in the zero-work does not have to meet accreditation
expense pools, we believe the better pool should be maintained in spite of standards;
option is to address the issue of mid- any adjustment we make, we believe • The wide divergence between the
level practitioners in the practice that such an approach would be unfair payments in the two settings may be
expense methodology. In this final rule, to the other services in the fee schedule encouraging the performance of
we have already addressed one aspect of whose practice expense RVUs are not gastrointestinal procedures by non-
this issue. Specifically, we have similarly protected from the effects of gastroenterologists; and,
eliminated any utilization data that changes we make in the practice • This reduction of payments for
reflects that the service was performed expense calculations. endoscopy services in the facility setting
by a mid-level practitioner. The other is contrary to the intent of the statute.
aspect of this proposal that we would (e) Site of Service The commenters had varying
like to address is the practice expense Clarifying the Definition of Facility/ recommendations on this issue: one
per hour calculation itself. As we have Nonfacility comment urged us to provide the same
indicated elsewhere, we are interested practice expense RVUs in the facility
in addressing this and other issues In the July 2000 proposed rule, we and nonfacility settings for 18
related to the practice expense clarified the definition of facility and endoscopic gastroenterological
methodology as we develop long-term nonfacility sites of service for the procedures. Another commenter
plans for refining the practice expense purposes of practice expense suggested that because we now pay
RVUs beyond 2002. calculations. This distinction takes into therapy services at the nonfacility rate
account the higher expenses of the regardless of setting, we should do the
(iv) Zero Work Pool practitioner in the nonfacility setting. same for the colorectal screening codes.
There were no proposals in the July The major purpose of this distinction is A major specialty society stated that it
2000 proposed rule on this issue. to ensure that Medicare does not is in the process of working with
However, in the November 1999 final duplicate payment, to the physician and gastroenterology societies to develop a
rule, we implemented the proposal to to the facility, for any of the practice proposal to create a single site-of-service
remove requested services from the zero expenses incurred in performing a payment rate for those services that are
work pool and return them to the service for a Medicare patient. For furnished less than 10 percent of the
specialty-specific cost pools. purposes of the site-of-service, we have time in the office.
Comment: Many specialty societies defined hospitals, skilled nursing Response: We believe that some of the
and the AMA expressed approval of our facilities (SNFs), and ambulatory commenters continue to misunderstand
decision to remove a list of CPT codes surgical centers as facilities, because the reasons for the distinction between
from the ‘‘zero work pool’’ in response they will receive a facility payment for the facility and nonfacility sites of
to specific requests to do so. Other their provision of services. In the July service and the actual implications of
organizations, representing specialties 2000 proposed rule, we proposed to this distinction. We have perhaps added
with technical services, supported our revise § 414.22(b)(5)(i) (Practice expense to this confusion by continuing, on
decisions—(1) not to modify the RVUs) to define community mental occasion, to use the term ‘‘site-of-service
practice expense RVUs for diagnostic health centers (CMHCs) as facility differential’’ to describe this policy.
imaging ‘‘zero work’’ services in any settings since CMHCs also receive a Under the charge-based practice
substantial way at this time; and (2) to separate facility payment for their expense methodology, there was an
keep the zero work pool intact, at least services. actual differential; certain services were
until we can develop a methodology automatically reduced by a pre-
In addition, we clarified that the determined amount when furnished in
that accurately captures TC costs.
nonfacility practice expense RVUs the facility setting. However, in our
Several commenters did express a
should be applied to all outpatient current resource-based ‘‘top-down’’
concern that we erroneously removed
therapy services (physical therapy, approach, we employ no such
from the pool an amount equal to the
occupational therapy, and speech reduction. Rather, we carry out the
increased payment the removed services
language pathology), even when they statutory requirement to develop
would receive in their own pools, rather
are provided in a facility. Only the practice expense RVUs that reflect the
than the payment rate the services were
facility can bill for therapy services relative resources involved with
assigned in the zero-work pool. Another
furnished to hospital and SNF patients. furnishing each service. We doubt that
specialty society representing TC
Because there will be only one bill for any specialty society would argue that
providers argued that the RVUs of the
this service and because the payment the direct costs of performing a service
codes remaining in the pool should
must reflect the practice expenses in the office setting are not higher than
have been maintained at their previous
incurred in furnishing the service, the in the facility setting. In the office
Response: We are pleased that there is higher nonfacility RVUs are used to pay setting, the physician must bear the
general support of our adjustments to for therapy services even in the facility costs for all of the clinical staff, supplies
the zero work pool. With respect to the setting. and equipment needed to perform a
concern expressed, we did deal with the Comment: Three specialty societies given service; in the facility setting,
removal of services from the zero work representing gastroenterologists these costs are the responsibility of the
pool in a manner that seems consistent reiterated their disagreement with our facility. Our RVUs reflect the relative
with the views of the commenters. We site-of-service policy because they resources used in furnishing the service
only subtracted from the pool the believe— in each of the facility and nonfacility
dollars for the utilization associated • The policy offers a financial settings. Therefore, to the extent that we
with the removed services, which incentive for physicians to perform have correctly identified the relative
would represent the rate the services certain gastroenterological procedures direct costs, there should be no

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00026 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations 65401

incentive to perform a service in either specialists, most of whom are not to make recommendations to us on this
setting. It is true that we pay more to the hospital-employed, incur practice issue.
physician if the service is furnished in expense (in the form of a lease or rent) Comment: A long-term care
the office, but that is because greater when they provide ambulatory services association recommended that we
resources are involved with furnishing in a hospital-owned facility. This clarify our policy on mixed facilities,
the service in that setting. The fact that expense most typically includes which are SNFs that also have nursing
there is a significant difference between administrative and clinical staff. home beds, to state that the
the facility and nonfacility payment for Response: We would need more presumption should be made that the
any given service seems to us both information on the scenario described therapist is treating a nonfacility
expected and appropriate. We believe before we can formulate a definitive patient. A society representing
that properly reflecting the relative response on this issue. For example, it podiatrists requested confirmation of
resources involved with furnishing is not clear whether these pediatric this policy.
services in the facility and nonfacility services as described would always be Response: We do not agree that the
settings creates no incentive to perform considered ‘‘facility’’ services. A visit to above recommendation would be a
a service in one setting or another. In a physician’s office that is leased from clarification of our policy on ‘‘mixed’’
contrast, a policy that paid the same a hospital could, in many facilities. We explicitly stated in our
amount for a service furnished in a circumstances, be considered a ‘‘non- July 1999 proposed rule that a service in
facility and nonfacility setting would facility’’ service by Medicare, if there is a mixed facility should be designated as
create an incentive to furnish the service not a Part A bill for the same service. In a facility service (that is, the place of
in the facility setting and, thus, would addition, indirect expenses, such as rent service would be a SNF), unless the
not be incentive-neutral. or administrative staff salaries, are practitioners can verify that no Part A
We have serious reservations about treated the same in all sites under our claim will be made for the service. In
adopting a policy to develop a single methodology. We would welcome the latter case, the place of service
site-of-service payment for services that further discussion on this issue. would be a nursing home, and the
are furnished less than 10 percent of the service would be paid at the nonfacility
Comment: A comment from an
time in the office. First, if there are real rate. We did not change this policy in
association representing providers of
concerns regarding patient safety when our November 1999 final rule, and we
services in long-term care facilities believe that this is an appropriate
certain procedures are furnished in the
contended that there should be a site-of- policy.
office, sufficient evidence should be
service differential for settings such as Comment: Commenters were
presented to the relevant parties so that
SNFs, where patient acuity is higher supportive of the expansion of the
an appropriate coverage decision can be
and where services must be transported definition of facilities to include
made. We emphasize that such a
to the patients. Use of data from the community mental health centers
decision would be a coverage decision,
SMS survey for services performed (CMHCs). However, one commenter,
and would not be a payment policy
outside of the physician’s office is not representing a state health department,
issue. Second, a 10-percent threshold
could eliminate payment in the office appropriate. An occupational therapy requested that we clarify the distinction
setting for some high-volume association stated that, though they between CMHCs and other types of
procedures done thousands of times concur with our clarification that community mental health entities to
there. Third, we have some concern that therapy services would always be paid which this would not apply.
this issue may be a matter of contention at the nonfacility rate, the resources Response: A CMHC is a distinct type
between those specialties that generally necessary to provide therapy services in of facility certified for Medicare
perform procedures in physician-owned facilities are not adequately reflected in participation for the purpose of
ASCs and other specialties that would our practice expense calculations. A providing ‘‘partial hospitalization
utilize the office setting. We would commenter representing geriatricians services’’. As we had explained in the
suggest that this issue, either as a commented that pre-and post-care proposed rule, Medicare payment to a
general proposal or on a code-specific involved in nursing home visits are not facility typically includes the cost of
level, be discussed in the PEAC/RUC, reflected in the nursing home visits. services furnished. If an entity is not
where a multi-specialty Response: The practice expense RVUs participating in the Medicare program,
recommendation could then be for the office and facility settings differ the nonfacility practice expense RVUs
submitted to us. primarily as a result of the differences would apply to the services. We believe
The site-of-service policy for therapy in the direct costs in these sites. Because this may not have been clear in the
services mentioned by a commenter as the SNF would bear the costs of the proposed rule. We are revising
a precedent is not applicable to other clinical staff, supplies and equipment, § 414.22(b)(5)(i)(A) to specifically
services in the physician fee schedule. the cost to the practitioner is less than provide that, for calculation of practice
As described above, the facility itself it would be in the office setting. It is not expense RVUs, a CMHC is considered to
must bill for both the technical and clear to us how the acuity of the patients be a facility and revising
professional portion of the therapy in a SNF would affect the direct practice § 414.22(b)(5)(i)(B) to parallel the
service; in these circumstances, the expense costs of the practitioner, or language of § 414.22(b)(5)(i)(A). We also
therapist does not bill Medicare at all. what resources are not reflected in our specify that the nonfacility practice
Therefore, the nonfacility RVUs are calculations, since the practitioner is expense RVUs are applicable to
used to ensure that the facility is paid not responsible for the direct costs in outpatient therapy services regardless of
for the direct costs incurred in the that setting. If there is clinical staff time the actual setting.
service. for staff back in the office associated Comment: One organization
Comment: A specialty society with nursing home visits, this issue commented that the proposed rule did
representing pediatricians believed that should be brought to the attention of the not address coverage or payment for
the site-of-service differentials will PEAC/RUC, because they are ‘‘inpatient’’ only services performed in
likely have an adverse impact on considering an approach to the outpatient setting, and referenced
pediatric specialty care that is primarily standardizing ‘‘coordination of care’’ the outpatient PPS rule published April
hospital-based. Most pediatric sub- clinical staff times for various services 7, 2000.

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00027 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
65402 Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations

Response: This issue is addressed in establishing a rank order reliability in consistent with the statutory
the outpatient prospective payment the time data based on dependability of requirement to recognize ‘‘all staff,
system rules. the process that generated the time equipment and supplies and expenses’’
values. For instance, the commenter in determining the practice expense
(f) Other Practice Expense Issue
suggested that operative logs would RVUs.
Comment: One specialty society provide a measure of skin-to-skin time We do agree with the commenter that
recommended that we keep the practice for intraoperative portion of surgical it may be helpful to validate physician
expense RVUs that will be fully procedures that should rank above a time data using independent
resource-based in 2002 as interim RVUs group of estimates of the same time information sources such as operative
for a minimum of another three years, made by surgeons. logs. In fact, as we described in the July
during which we would consider Response: With respect to the 2000 proposed rule (65 FR 44202), we
comments for further code-level criticism of the CPEP data, we have several efforts underway to obtain
refinement. acknowledge that there are limitations information on times spent performing
Response: As long as there is a good and anomalies in the data that may individual procedures, including using
faith effort on the part of all parties to distort values for some services. As inpatient and outpatient records and
continue the quality work that the required by the BBA, we have operative reports on skin-to-skin
PEAC/RUC has already undertaken, we established a refinement process that surgical times for selected procedures.
do not plan to close the door on further will address the inputs for many codes. Comment: One surgical specialty
code-level refinements in 2002. We In this final rule, we are reflecting society reiterated its contention that we
understand the magnitude of this task refinements to the practice expense have not been providing the impact
and have an interest in ensuring that inputs for office visits and office analysis required by the BBA and
there is sufficient time to deal with the consultations. As a result, services that requested that we do so. The
CPEP inputs of all services in a account for approximately 22 percent of osteopathic surgeons requested that we
thoughtful and equitable manner. Medicare allowed charges for publish the impacts rounded to a tenth
Comment: A specialty society physicians’ services will have been of a percent and that we display the
representing neurological surgeons reviewed and the inputs been refined. impact for the entire period of the
made a number of comments critical of As we describe elsewhere in this rule, transition rather than for the individual
the methodology used to allocate we are making other refinements with year. A society representing radiation
practice expenses. These criticisms respect to how equipment costs are oncology also requested that we expand
pertained to virtually every aspect of the being allocated, and we are continuing the percentage of impact by several
methodology. For instance, there was to consult with the PEAC on developing decimal places; although the impact
criticism of the CPEP data, the SMS supply cost packages that will facilitate table for radiation oncology displays
data, and the idea that indirect practice refinement of this aspect of the practice zero percentage impact for each
expenses are a function of the amount expense inputs. Although the category, there is a total increase of one
of time spent in patient care activities. commenter believed that surveys of percent. An ophthalmology society
The commenter further indicated that physician practices for resource inputs requested that we publish more detailed
the ‘‘cursory efforts to ‘validate’ CPEP would be an improvement over the impacts, and enumerated five additional
data by having it reviewed by RUC’s scrutiny being applied by the PEAC, we impact analyses or tables we should
Practice Expense Advisory Committee disagree. A survey process to collect include in the final rule. Three other
(PEAC) seems more pro forma rather direct cost inputs for the over 7,000 specialty societies urged us to conduct
than have it based on some independent procedures on the Medicare physician the sensitivity analyses recommended
appraisal of the real costs that may be fee schedule would be enormously by the GAO, because, without knowing
involved.’’ In addition to the criticism expensive and time consuming and may the effect of a change in methodology or
cited above with respect to the be unlikely to yield better results than data, it is difficult to know whether the
methodology for allocating indirect are being recommended by the RUC/ proposed change is acceptable.
costs, the commenter suggested that we PEAC. We believe the RUC/PEAC Response: We have addressed these
should have summed the three indirect process allows for a multispecialty comments in previous rules. We provide
cost categories (administrative labor, review of inputs for particular a discussion of impacts in each
office expense, and other expense), and procedures. These RUC/PEAC proposed and final rule. We also
allocated the result to individual codes recommendations have been helpful to provide detailed information on the
based on the work RVUs. The us in simplifying the number of data HCFA web page, which allows any
commenter suggested that this was a inputs going into individual codes and group to select services of interest and
better method than the ‘‘unnecessarily in improving the overall quality of the determine the impacts resulting from
tortuous’’ approach we adopted that data that are being used to determine payment rates.
‘‘used the total SMS pool and divided practice expense RVUs. Comment: A commenter suggested
it by the pool of direct expenses * * * With respect to the indirect that we should identify a way to
to generate a scaling factor that methodology, the commenter is incorporate the cost of compliance with
represented the fraction of the total that essentially suggesting that we abandon regulations into the practice expense
the CPEP data calculation claimed as the direct inputs and use the work RVUs payments or into the annual updates to
direct.’’ In addition, the commenter as the basis for allocating all indirect the physician fee schedule.
objected to a ‘‘single adjustment’’ of 25 costs. While this approach may be Response: To the extent that these
percent made to the Harvard physician simpler, we disagree that such a costs are due to increased clinical or
time data that are being used to generate methodology will improve overall administrative staff time, the SMS or
the practice cost pools. They indicated equity in Medicare payment for supplementary surveys should reflect
that this adjustment distorts time values physicians’ services. It would, of course, these expenses, so they are already
for many codes. The commenter likely increase payments to specialties reflected in the practice expense
suggested that RUC time data would be with relatively high work values and calculations.
more reliable than Harvard time data low direct costs. Furthermore, we do not Comment: A specialty society
and that we should consider believe this approach would be representing podiatrists requested

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00028 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations 65403

clarification concerning the reduction in valued by one CPEP panel. The physical reflect expenses for therapists in private
practice expense RVUs for CPT code therapy codes were valued by two CPEP practice. While we agreed that these
11750, Removal of nail bed, as panels, one of which estimated higher space requirements were insufficient
compared to the previous charge-based staff times than the other, giving these and increased the space to 500 square
RVUs. codes a higher average time. The feet, the commenter continues to believe
Response: Because the charge-based refinement of these codes should that the salary equivalency data is not
practice expense RVUs were not based remove this issue, although, for the an accurate measure of the expenses
on the resources used to perform a reason explained above, the practice associated with operating a physical
service, the payment for many services expense RVUs may still not be identical. therapy office since these apply to
either increased or decreased, some Comment: Two organizations therapy services furnished by an outside
significantly, when we implemented representing audiologists submitted a contractor to an outpatient hospital,
resource-based practice expense. In joint comment which reiterated their skilled nursing facility, home health
themselves, such changes are not concern regarding our use of data from agency, clinic, rehabilitation agency or
indicative of an error in our the other specialties that perform
public health agency.
calculations. A comparison to the values audiology services to calculate the
practice expense RVUs for these Response: In general, we believe it is
assigned to codes in the same or similar
families would be more important. It services. The specialty society intended better to use data that reflect a specific
appears that the fully implemented to perform a survey of audiologists’ physician specialty or nonphysician
practice expense RVUs for CPT 11750 practice expenses in order to gather practitioners’ costs if they are available.
are in the same range as the values for more accurate data. For the direct expense items (clinical
related services. If the specialty society Response: We have published the staff, equipment and medical supplies),
believes this is not the case, we would criteria and process for the submission there was no data available for physical
need more information as to which of specialty-specific supplementary therapy so we used a crosswalk to the
codes’ values appear anomalous. survey data. We would welcome this all physician rate. For the indirect cost
additional information. items, we used the information that is
Comment: An occupational therapy
Comment: A specialty society directly applicable to physical therapy
association noted that the fully-
representing geriatricians contended for use in the practice expense
implemented practice expense RVUs for that this specialty requires more office
CPT 97110, Therapeutic exercises are methodology. While the use of salary
space than other providers and wanted equivalency guidelines data may have
greater than those for CPT 97530, us to increase the space requirements
Therapeutic activities, even though the been developed for contract physical
beyond what is allowed for internists. therapists providing services in
CPEP inputs that we accepted should be They believe we have set a precedent for
the same for both services. The facilities, we believe that a potential
this by altering the space allotment for shortcoming for its use is related to the
commenter also questioned why, in the physician and occupational therapists.
November 1999 final rule, the practice number of square feet of space that are
Response: Under our current practice allotted for each therapist. In response
expense RVUs for the occupational expense methodology, we do not have
therapy evaluation and re-evaluation to previous comments we increased the
space requirements for any physician
services, CPT 97003 and 97004, were space allocation to 500 square feet in the
specialty. The amount of office space
lower than those for the physical November 1999 final rule (64 FR 59404).
needed would presumably be reflected
therapy evaluation and re-evaluation While we are currently using 500 square
in the SMS indirect costs for each
services, CPT 97001 and 97002. surveyed specialty, but we have no way feet for the space allotment and believe
Response: We checked the CPEP of knowing what this is, or of making an that that amount may recognize some
inputs for CPT codes 97110 and 97530. adjustment to these costs for a given components of indirect costs, the figure
The time associated with the use of specialty or sub-specialty. The still may understate the space
procedure-specific equipment for CPT adjustment for the physical therapists requirements for private practice
97110 was inadvertently overstated, was a different issue. Because we physical therapists because it does not
causing a slight increase in the believed that the crosswalk to the ‘‘all recognize other components of indirect
equipment cost for that service. We have physician’’ rate that we used for costs that are not incurred by contract
corrected this error. In addition, as we physical therapy would overstate the physical therapists working in a facility
explained in the November 1999 final indirect costs, we substituted a lower setting. In an earlier comment, the
rule, we deleted the tables in the rate based on a study of physical and American Physical Therapy Association
equipment lists from CPT 97530 occupational therapists that computed indicated that 250 square feet is
because we believed the service would costs for therapy services partially on inadequate for physical therapists in
typically be performed while the patient the space used for therapy agencies and private practice. The comment indicates
was standing. However, even when two later made an adjustment to that rate. that approximately 700 to 850 square
services have identical inputs, the final This adjustment would have no feet per therapist are necessary. We are
practice expense RVUs can differ, if a relevance to any other specialty. increasing the space requirements from
different mix of specialties perform the Comment: A commenter objected to the salary equivalency guidelines for
two services. One reason for the the use of salary equivalency guidelines physical therapy to 750 square feet. This
difference between the occupational and to determine the indirect cost pools for revision will result in use of the
physical therapy evaluation and re- physical therapists. The commenter following practice expense per hour for
evaluation services is that the indicated that the original estimate of physical therapy for calculation of the
occupational therapy codes were only 250 square feet was insufficient to 2001 practice expense RVUs:

Clinical staff Admin staff Office expense Supplies Equipment Other Total

12.3 5.8 7.5 7.3 3.1 4.4 40.4

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00029 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
65404 Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations

Comment: Many individuals and 1994 work GPCIs were based on 1980 1992 through 1994 data used in the
several specialty groups expressed census data because 1990 census data previous GPCI update.
concern about the relatively low rates were not yet available. The work GPCIs We received the following comments
contained in the July 2000 proposed were revised in 1995 with new data and responses on our proposed GPCI
rule with respect to pain management from the 1990 census. New census data changes.
services. They suggested that this may will not be available again until after the Comment: One commenter stated that
be due to the practice expense 2000 census. We searched for other data Medicare physician reimbursement
component for these services being that would enable us to update the work should not vary by geographic area.
undervalued. They also pointed out that GPCIs between the decennial censuses, Response: The law requires that
a few of the services seemed to have but no acceptable data sources were payments vary among payment
significant reductions. found. localities as locality cost differences
Response: A few of the pain We therefore made no significant vary as measured by the GPCIs.
management codes were affected by a changes to the 2001 through 2003 work However, the work GPCI by law reflects
programming error related to work GPCIs from the 1998 through 2000 work only 1⁄4 of the difference in the relative
RVUs. We apologize for the error and GPCIs, other than the generally value of physicians’ work in the area
ensured that this was corrected in this negligible changes resulting from using and the national average.
final rule. To the extent that the rates Comment: One commenter stated that
1998, rather than 1994, RVUs for this
are low due to the practice expense we should not use census data on the
GPCI update, because we were unable to
component being undervalued, we earnings of other highly educated
find acceptable data for use between the
would recommend that specialty groups professionals as a proxy for physician
decennial censuses. We believe that
forward the codes in question to the earnings. The commenter suggested that
making no changes is preferable to
RUC/PEAC for refinement. we instead use IRS income tax data on
making inaccurate changes based on
actual physician income, which also has
B. Geographic Practice Cost Index unacceptable data. We believe that this
the advantage of being available on an
Changes is a reasonable position given the
annual basis rather than every 10 years
generally small magnitude of the
The Act requires that payments vary like the decennial census.
changes in payments resulting from the Response: As stated in this year’s
among fee schedule areas to the extent changes in the work GPCIs from the
that resource costs vary as measured by proposed rule and in all previous
1980 to the 1990 census data. reports on the GPCIs, the actual reported
the GPCIs. Section 1848(e)(1)(C) of the
Act requires us to review and, if 2. Practice Expense Geographic Practice earnings of physicians were not used to
necessary, adjust the GPCIs at least Cost Indices adjust geographical differences in fees
every 3 years. This section of the Act because the fees are in large part a
a. Employee Wage Indices determinant of the earnings. We believe
also requires us to phase in the
adjustment over 2 years and implement As with the work GPCIs, the that the earnings of physicians will vary
only one-half of any adjustment in the employee wage indices are based on among areas to the same extent that the
first year if more than 1 year has elapsed decennial census data. For the same earnings of other professionals vary. The
since the last GPCI revision. reasons discussed above pertaining to GPCI compares average hourly wages of
The GPCIs were first implemented in the work GPCIs, we are not changing the professionals among geographic areas.
1992. (A detailed discussion of the employee wage indices during this GPCI IRS data on the earnings of physicians
development of the GPCIs and update. and other professionals were previously
references to obtaining studies on the examined as a possible work GPCI data
b. Rent Indices source. The IRS data were rejected for
development of the GPCIs can be found
in the July 17, 2000 proposed rule (65 The office rental indices are again numerous reasons, chiefly because—(1)
FR 44189).) The first review and based on HUD residential rent data. No they did not control for hours worked,
revision was implemented in 1995, and changes have been made in the and thus, average hourly earnings could
the second review was implemented in methodology. The rental indices are not be determined; (2) the business tax
1998. based on 2000 rather than 1994 HUD returns of physicians and other
The 2001 through 2003 GPCIs data. professionals include entrepreneurial
represent the third GPCI update. The return, as well as the opportunity cost
c. Medical Equipment, Supplies, and of time (what a physician on salary
2002 GPCIs (Addendum D) are the fully- Miscellaneous Expenses
revised GPCIs. The 2001 GPCIs could earn per hour); and, (3) the
(Addendum E) represent the one-half As with all previous GPCIs, this business returns contain no information
transition GPCIs. Addendum F shows component will be given a national on the number and mix of employees
the estimated effects on area payments value of 1.000, indicating no measurable (physicians are included with other
of the fully-revised 2002 GPCIs. The differences among areas in costs. nonphysician employees). The Medicare
payment effects in 2001 will be about physician fee schedule is based on the
3. Malpractice Geographic Practice Cost
one-half of these amounts. principle that fees should reflect costs,
The same data sources and such as opportunity wages, but not
methodology used for the 1998 through As with the previous GPCIs, other factors, such as entrepreneurial
2000 GPCIs were used for the 2001 malpractice premium data were profit.
through 2003 GPCIs. The only collected for a mature ‘‘claims made’’ Comment: Two commenters stated
differences between the 1998 through policy with $1 million to $3 million that the rent GPCI for Puerto Rico is
2000 GPCIs and the proposed GPCIs are limits of coverage, with adjustments severely understated. They believe the
in the cost shares and RVU weighting. made for mandatory patient HUD rental data to be inordinately low
compensation funds. The only relative to the national average because
1. Work Geographic Practice Cost difference is that we proposed to use of the high level of poverty in Puerto
Indices more recent data. The proposed Rico. They believe that physician rents
The work GPCIs are based on the malpractice indices are based on 1996 are relatively higher compared to the
decennial census. The 1992 through through 1998 data, compared to the national average than reflected by the

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00030 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations 65405

HUD data. The commenters suggested C. Resource-Based Malpractice Relative Comment: Some commenters stated
that we fund a special study to examine Value Units that they were unable to duplicate the
the rental costs in Puerto Rico to see if Resource-based malpractice RVUs malpractice RVU calculations using the
the HUD rent proxy is inadequate to replaced the prior charge-based premium data and risk factors shown in
reflect physician rental costs, and, if so, malpractice RVUs on January 1, 2000. A our previous proposed and final rules.
to expand the study to other areas with detailed description of the methodology They requested that we provide them
inordinately high poverty rates. used in establishing the 2000 with all necessary information to
malpractice RVUs can be found in the reproduce the malpractice RVUs.
Response: For the next GPCI update,
Response: To address this concern,
we will again look for alternative July 1999 proposed rule (64 FR 39610)
we had our contractor, KPMG
sources to the HUD data. and the November 1999 final rule (64
Consulting, prepare a technical
Comment: One commenter whose FR 59383). The 2000 malpractice RVUs addendum. This addendum presents a
malpractice GPCI would have decreased are based on 1993 through 1995 detailed explanation of all of the
under the proposed rule stated that this malpractice insurance premium data, information used—a table of specialty
would reflect decreasing malpractice the latest data available when we began premiums, risk factors for each specialty
premiums, while in reality their collecting data to establish the resource- either from the premium data or insurer
malpractice premiums have increased based malpractice RVUs. We stated in rating manuals, code crosswalks for new
since 1997, and, therefore, their last year’s proposed and final rules that and revised CPT codes, and the budget-
malpractice GPCI must be wrong. we were collecting more recent neutrality factor used by KPMG—with
premium data, and would update the examples of the methodology used in
Response: A decreasing malpractice malpractice RVUs as soon as we had
GPCI does not necessarily reflect calculating the malpractice RVUs. It also
finished collecting and analyzing the discusses special circumstances, such as
decreasing malpractice premiums. An more recent data.
area’s malpractice GPCI reflects its the use of different risk factors for OB/
In the July 2000 proposed rule we GYN for surgical, nonsurgical, and
relative position compared to the stated that we had obtained, and were delivery services, and the use of the
national average. An area could have currently examining, malpractice surgical risk factor for cardiology for
increasing malpractice premiums and premium data for 1996 through 1998. certain cardiac catheterization services
still experience a decrease in its We provided a table that compared the even though the services are not in the
malpractice GPCI if its premiums 1993 through 1995 average premiums surgery section of CPT. When combined
increased less than the national average (used to calculate the 2000 malpractice with our 1999 specialty utilization data,
rate of increase. RVUs) with the 1996 through 1998 it should be possible to reproduce
Comment: A commenter from Kansas average premiums (used to calculate the KPMG’s malpractice RVU calculations.
commented that Kansas prohibits 2001 malpractice RVUs). The table This technical document can be found
territorial rating of malpractice showed that there was very little change at Addendum G.
premiums within the State; yet we show in the national average premiums from Comment: One commenter stated that
two different malpractice GPCIs for 1993 through 1995 to 1996 through we should explore the collection of non-
Kansas. They state that one of these 1998. We, therefore, anticipated M.D. and non-D.O. premium data (such
must be an error. minimal changes in malpractice RVUs as for podiatrists, chiropractors, and
from use of the more recent data. nurse practitioners) for future
Response: We agree. Kansas is a single In addition, in response to comments
statewide locality under the physician malpractice RVU updates.
received on last year’s rule, we Response: We will consider searching
fee schedule. We show two sets of proposed to accept a comment regarding
GPCIs because Kansas is served by two for such data for specialties such as
crosswalking specialties. We proposed podiatrists and chiropractors. We would
carriers. However, the GPCIs should be to crosswalk surgical oncology to
the same. The malpractice GPCI shown not expect to collect such information
general surgery rather than to all for groups such as nurse practitioners
in the proposed rule for carrier 00740 physicians. We also indicated that the
was erroneous. Both carriers should since the law establishes their payments
malpractice values to be included in the at 85 percent of the physician rate.
have the same malpractice GPCI of final rule reflecting the updated data Comment: One commenter suggested
0.823. would remain interim. that certain invasive electrophysiology
Result of Evaluation of Comments Comment: Numerous commenters codes, have the same relative risks as
commended the use of more recent 1996 cardiac catheterization codes, and
The 2002 fully-effective revised GPCIs through 1998 malpractice premium data should be assigned a surgical risk factor
and the transitional 2001 revised GPCIs to replace the 1993 through 1995 data in similar to the risk factor assigned to
can be found at Addendum D and calculating the malpractice RVUs. cardiac catheterization codes.
Addendum E, respectively. No changes Response: We plan to use the most Response: We agree, and have
were made in the 2002 and 2001 GPCIs recent available data in updating assigned a surgical risk factor to CPT
from those proposed in the July 17, 2000 malpractice RVUs. codes 93600 through 93612, 93618
proposed rule, except to correct the Comment: Commenters stated that through 93641, and 93650 through
erroneous Kansas malpractice GPCI since the proposed 2001 malpractice 93652.
discussed above. Since the revised RVUs were not available for comment in Comment: One commenter stated that
GPCIs could result in total payments the July proposed rule, and are being since most OB/GYNs perform both
either greater or less than payments that seen for the first time in this final rule, obstetrics and gynecology, the higher
would have been made if the GPCIs they be considered interim and subject obstetrics premium should be used for
were not revised, it was necessary to to comment and revision. all services performed by OB/GYNs.
adjust the GPCIs for budget neutrality as Response: We agree. The proposed Response: We disagree. This comment
required by law. Therefore, we adjusted 2001 malpractice RVUs will be was also addressed in the November
the 2001 through 2002 GPCIs as follows: considered interim, subject to revision 1999 final rule. To reiterate our
work by 0.99699; practice expense by in 2002 based on comments received on response, it is true that a physician
0.99235; and malpractice by 1.00215. this final rule. furnishing a wide range of services—

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00031 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
65406 Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations

from low-risk visits to high-risk neutrality adjustment, since we made no new HCPCS code G0182 (care plan
surgeries or deliveries—will probably adjustment last year. They argue that oversight, hospice) using the CPT 2000
pay a malpractice premium driven by such an adjustment would skew definition associated with CPT code
the higher-risk procedures. payments. 99378. The definitions proposed for
The purpose of the resource-based Response: As indicated in the these new codes are:
malpractice RVUs is not to guarantee previous response, we are restoring the G0181 Physician supervision of a
each physician an absolute return of work RVUs for critical care to 4.0 for patient under care of Medicare-covered
malpractice costs. It is rather to CPT code 99291 and 2.0 for CPT code home health agency (patient not
construct malpractice RVUs based on 99292. The earlier reductions to the present) requiring complex and
the relative malpractice costs among work RVUs were made assuming there multidisciplinary care modalities
services. We believe that it is reasonable would be a substitution of critical care involving regular physician
to use the lower risk factors for the for other services that would increase development and/or revision of care
values of the lower risk services and to net payments if there were no plans, review of laboratory and other
allocate the higher relative values to the reductions to the work RVUs. We studies, communication (including
higher risk services that cause them. In believe this substitution will not occur telephone calls) with other health care
the case of OB/GYN services, the higher because of additional revisions to the professionals involved with the
obstetrical premiums were used for definition of critical care for 2001. Thus patient’s care, integration of new
services that were clearly obstetrical and net payments would decrease if we do information into the treatment plan and/
were causing the higher obstetrical not restore critical care RVUs to their or adjustment of medical therapy,
premiums; the gynecological surgical former levels. within a calendar month; 30 minutes or
risk factor was used for the surgical Comment: One commenter urged that more.
services, and the lower nonsurgical we reconsider including payment for EB G0182 Physician supervision of a
GYN risk factor was used for all other services within the critical care codes, patient under care of Medicare-covered
services. We would further note that because they believed it would have a hospice (patient not present) requiring
even if we were to adopt the approach negative impact on its use in hospitals. complex and multidisciplinary care
suggested by this comment, it would Response: The physician work modalities involving regular physician
have very little, if any, impact on required to perform this service involves development and/or revision of care
payment rates since OB/GYN specialties reading and interpreting a series of plans, review of laboratory and other
perform such a small proportion of the numerical measurements. This is studies, communication (including
low risk visits provided to patients in generally performed in conjunction with telephone calls) with other health care
the U.S. an evaluation and management service professionals involved with the
because the measurements produced by patient’s care, integration of new
Result of Evaluation of Comments this procedure are difficult to interpret information into the treatment plan and/
New malpractice RVUs based on the without a clinical evaluation of the or adjustment of medical therapy,
more recent 1996 through 1998 patient. We continue to believe that it is within a calendar month; 30 minutes or
premium data will become effective on appropriate to include payment for this more.
January 1, 2001. These malpractice service within the critical care service We also stated that current policy
RVUs will be considered interim for since the critical care service includes guidance that applied to CPT codes
2001 and subject to comment and the review of EB tests. Other services 99375 and 99378 will continue to apply
possible revision in 2002. These such as the interpretation of cardiac to these G codes, and current payments
malpractice RVUs can be found in output measurements (CPT 93561 and for CPT codes 99375 and 99378 will be
Addendum B. 93562) are currently included in the maintained in G0181 and G0182.
payment for critical care services, and In addition, we proposed establishing
D. Critical Care Relative Value Units two new HCPCS codes (G0180 and
we do not believe this has had an
Based on revisions to the definition of adverse impact on their performance in G0179) to describe the physician’s
critical care services (CPT codes 99291 the hospital. services involved in physician
and 99292) in the CPT manual for CY certification (and recertification) of
2001, we proposed to value the Result of Evaluation of Comments Medicare-covered home health services.
physician work at 4.0 RVUs for CPT We will finalize our proposal and These services include creation and
code 99291 and 2.0 RVUs for CPT code value the physician work at 4.0 RVUs review of a plan of care for a patient and
99292. for CPT code 99291 and 2.0 RVUs for verification that the home health agency
In addition, consistent with our CPT code 99292. In addition, we will initially complies with the physician’s
discussion in the July 2000 proposed not allow separate Medicare payment plan of care. The physician’s work in
rule for electrical bioimpedance (EB), for EB when provided in conjunction reviewing data collected in the home
(see section H), we proposed not to with critical care services (CPT codes health agency’s patient assessment,
allow separate Medicare payment for EB 99291 and 99292). including the Outcome and Assessment
when it is furnished in conjunction with Information Set (OASIS) data, would be
critical care services (CPT codes 99291 E. Care Plan Oversight and Physician
Certification and Recertification included in these services.
and 99292). The proposed text for the new codes
Comment: Commenters supported the In anticipation of CPT revisions to the was as follows:
revision to the physician work for these definition of care plan oversight, we • G0180 (referred to as Gxxx3 in the
two codes. However, in the regulatory proposed establishing two new HCPCS proposal but renumbered in this final
impact section of the July 2000 codes for care plan oversight to be rule) Physician services for the initial
proposed rule (65 FR 44208), we stated consistent with our payment policies. certification of Medicare-covered home
that ‘‘* * * any impact of this proposal For the 2001 physician fee schedule, we health services, for a patient’s home
would be incorporated in the physician proposed adding a new HCPCS code health certification period, and
fee budget neutrality calculations.’’ G0181 (care plan oversight, home • G0179 (referred to as Gxxx4 in the
Commenters believed it would be health), using the CPT 2000 definition proposal but renumbered in this final
inappropriate to make a budget associated with CPT code 99375 and a rule) Physician services for the

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00032 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations 65407

recertification of Medicare-covered delivering the home health or hospice not specified under section 1861(r) of
home health services, for a patient’s services. the Act cannot meet the requirements
home health certification period. While we recognize that non-health for certifying and recertifying home
Under the proposed rule, the use of professionals contribute to the care of health services under sections 1814 and
these codes would have been restricted both home health and hospice patients, 1835 of the Act that independently
to physicians who are permitted to our long-standing policy has been that require physician certification and
certify that home health services are payment for these services is included recertification to establish the necessity
required by a patient according to in the payment for evaluation and of treatment.
section 1814(a)(2)(C) and section management services. As we indicated Comment: Many commenters
1835(a)(2)(A) of the Act. in the December 8, 1994 final rule (59 indicated they knew about the CPT
Under the proposed rule, the FR 63421) that originally established panel’s plans to change the code
physician certification for home health Medicare policies for care plan definition for 2001. They indicated that
code (G0180), could be reported only oversight services, we recognize for the CPT definition revision adding the
once every 60 days, except in the rare separate payment only the physician’s reference to non-health professionals
situation when the patient starts a new communications to the health care was merely to clarify that
episode before 60 days elapses and professionals involved in the patient’s communication with these individuals
requires a new plan of care to start a care. The goal in care plan management is sometimes just as integral in
new episode. For services within the is to be certain that the home health or providing good care. Some commenters
episode (generally beyond the first week hospice professional staff communicate also suggested that this was allowable
or two of care plan implementation) that with the patient’s physician to allow the when the codes were originally
are consistent with the definition of care beneficiary to receive appropriate care. developed.
This continues to be the justification for Response: We disagree with the
plan oversight, the care plan oversight
an additional payment. commenters. When we originally
code (G0181) would be used.
Comment: One organization requested established a separate payment for this
Because we believed that the clarification on whether nurse service, we established a G code to
physician work associated with HCPCS practitioners are able to bill for care describe the service. The CPT
code G0180 is equivalent to that of a plan oversight and physician subsequently adopted the code. It was
level 3 established patient office visit certification and recertification services. always our intent, as discussed above, to
(CPT code 99213), we proposed a value They stated that the preamble count the time spent with other health
of 0.67 for the work RVUs. For G0179, discussion suggested only physicians care professionals toward the 30-minute
we proposed a value of 0.45 work RVUs may bill for these services. The threshold. Although we agree that
because we believe the work equates to commenter believed that under the interactions with non-health care
a level 2 established patient office visit provisions of the BBA, nurse professionals are important to the
(CPT code 99212). For practice expense practitioners practicing within the scope overall care of patients, as explained in
RVUs, we proposed to crosswalk both of State law are also permitted to the previous response, such
G0180 and G0179 to the practice perform these services. communication is included in the pre-
expense inputs currently used for care Response: Under the provisions of the visit and post-visit work of evaluation
plan oversight (CPT code 99375), since BBA, nurse practitioners, physician and management codes.
both the certification and recertification assistants and clinical nurse specialists, Comment: Many commenters
and care plan oversight codes do not practicing within the scope of State law, expressed concern that adopting these G
require a face-to-face encounter between can bill for care plan oversight services. codes would complicate billing for care
the beneficiary and the physician. These non-physician practitioners must plan oversight services and exacerbate
Care Plan Oversight have been providing ongoing care for confusion surrounding these services,
the patient through evaluation and particularly since two sets of codes will
Comment: Several commenters management (E/M) services (but not if exist for care plan oversight (CPT and
objected to our proposal for G codes for they are involved only in the delivery of HCPCS).
care plan oversight services because the the Medicare-covered home health or Response: Although we understand
rationale presented in the July 2000 hospice service). Sections 1814(a)(2)(C) the commenter’s concern, we feel the
proposed rule (65 FR 44196) for the and 1835(a)(2)(A) of the Act require that revised definitions for CPT codes 99375
change was not clear. They stated that physicians certify and recertify the and 99378 necessitate the establishment
the public was not aware of specific necessity of home health care in order of temporary HCPCS codes G0181 and
definition changes proposed by the CPT for a particular beneficiary to receive G0182. To assure consistency with
panel, so they could not determine covered services. Thus, without regard current Medicare policy, we find it
whether the new CPT definitions to payment issues, in order to be necessary to retain the current
conflicted with Medicare policy. Thus, effective, a certification must be made definitions of care plan oversight by the
the commenters challenged the need for by a physician. We agree with use of temporary HCPCS codes G0181
such a complicated change. commenters that, according to section and G0182.
Response: We understand the 1861(s)(2)(K) of the Act, nurse
concerns of the commenters but we practitioners and others can perform Certification and Recertification
were at that time unable to provide the and, where appropriate, bill for a service Comment: Commenters generally
full text of the revised CPT codes in the that is a physician service and within supported the proposed new codes for
proposed rule. The CPT Committee had the scope of their practice. In adopting certification and recertification, and
not yet released the definitions. The codes for certification and some commenters emphasized that the
2001 revised CPT code definitions for recertification of home health services codes will have a positive impact on
CPT codes 99375 and 99378 make a and denominating them as billable patient care and also enhance the role
significant change. Specifically, the new physician services, we might be of the physician in home care. However,
definitions include the time the perceived as enabling these some commenters were concerned that
physician spends communicating with practitioners to bill those codes. the CPT/RUC process was not used for
non-professional caretakers involved in However, nurse practitioners and others the introduction of these codes, and

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00033 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
65408 Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations

recommended that these codes be this issue once we have more prescribed Medicare-covered home
submitted to the CPT panel for experience with these codes. health services, we are establishing two
establishment of codes. Comment: Another commenter new codes as proposed:
Response: We wanted the home expressed concern about the ambiguity • G0180 Physician services for
health certification and recertification of codes for care plan oversight, initial certification of Medicare-covered
codes to become active as soon as certification, and recertification. The home health services, billable once for
possible after the implementation of commenter also believed we needed to a patient’s home health certification
Medicare’s new home health take a more comprehensive approach to period. This code will be used when the
prospective payment system that was informing physicians about the home patient has not received Medicare-
effective October 1, 2000. Requesting health prospective payment system and covered home health services for at least
the CPT panel to adopt these codes was new codes. 60 days.
likely to delay their introduction. Response: We expect the discussion • G0179 Physician services for
However, we will now ask the CPT of these codes in this preamble to clarify recertification of Medicare-covered
panel to consider adopting these codes. their use. If additional questions remain, home health services, billable once for
Comment: A few commenters they can be addressed to our contractors a patient’s home health certification
expressed concern that the proposed who process Medicare bills. Our period. This code would be used after
values for the codes were provided with contractors will notify physicians about a patient has received services for at
no explanation; thus, it was difficult to fee schedule changes for 2001. least 60 days (or one certification
evaluate the proposal. period) when the physician signs the
Result of Evaluation of Comments
Response: To value these codes, we certification after the initial certification
For care plan oversight, we are period.
estimated the value of the work establishing the following two new The G0179 code will be reported only
involved. We expect to re-evaluate these codes as proposed: once every 60 days, except in the rare
services once physicians become more • G0181 Physician supervision of a situation when the patient starts a new
familiar with the new home health patient receiving Medicare-covered episode before 60 days elapses and
payment system and use of this services from a participating home requires a new plan of care to start a
procedure code. In addition, if the CPT health agency (patient not present) new episode. For services within the
panel adopts the codes, we expect that requiring complex and episode that are consistent with the
the RUC would also review them. multidisciplinary care modalities definition of care plan oversight, the
Comment: A few commenters asked involving regular physician care plan oversight code (G0181) would
whether surgeons may bill for this development and/or revision of care be used.
service or whether the service is plans, review of subsequent reports of Consistent with section 1835(a)(2) of
included in the surgeon’s global fee. patient status, review of laboratory and the Act, a physician who has a
These commenters recommended that other studies, communication significant ownership interest in, or a
surgeons be allowed to bill outside the (including telephone calls) with other significant financial or contractual
global surgery rules. health care professionals involved in relationship with a home health agency
Response: Surgeons who refer patient’s care, integration of new (HHA), generally cannot bill this code
patients for Medicare-covered home information into the medical treatment for patients served by that HHA.
health care and who are certifying (or plan and/or adjustment of medical We have retained the proposed
recertifying) the plan of care will be able therapy, within a calendar month; 30 relative values, for the reasons stated
to report codes G0179 and G0180. minutes or more, and earlier. The physician work associated
Comment: We received comments • G0182 Physician supervision of a with HCPCS code G0180 will be valued
that objected to our proposal to adjust patient receiving Medicare-covered at 0.67 and for G0179 the physician
the conversion factor to assure that services from a Medicare-participating work will be valued at 0.45. We will use
physicians expenditures would not hospice (patient not present) requiring the practice expense inputs used for
increase as a result of separate payment complex and multidisciplinary care care plan oversight (G0181) for both
for this service. Some commenters modalities involving regular physician codes.
stated that a budget-neutrality development and/or revision of care
adjustment should not be performed F. Observation Care Codes
plans, review of subsequent reports of
because they believed these were new patient status, review of laboratory and In the July 17, 2000 proposed rule (65
services that should appropriately other studies, communication FR 44196) we indicated that allowing
increase physician expenditures. (including phone calls) with other payment under the fee schedule for CPT
Response: We address this comment health professionals involved in codes 99234 through 99236,
in the impact section of this rule. patient’s care, integration of new Observation or inpatient hospital care
Comment: One commenter suggested information into the medical treatment services (including the admission and
we revise the definition of certification plan and/or adjustment of medical discharge services) for a patient on the
and delete reference to a ‘‘patient who therapy, within a calendar month; 30 same date, conflicts with two policies
has not received Medicare-covered minutes or more. currently in the Medicare Carrier
home health services for at least 60 As stated in the proposed rule, Manual (MCM). Section 15505.1(c) in
days.’’ There are scenarios when a current policy guidance that applied to the MCM states that we only pay for a
patient may require a new initial CPT codes 99375 and 99378 will hospital admission when a patient is
certification but 60 days have not continue to apply to these G codes, and admitted as an inpatient and is
lapsed. current payments for CPT codes 99375 discharged on the same day. Section
Response: Based on the opinions of and 99378 will be maintained in G0181 15504.b of the MCM states that CPT
our medical experts, we believe that and G0182, respectively. codes 99218 through 99220 (Initial
creating a new plan of care is For the services involved in physician Observation Care) should be used if the
significantly more work than making certification (and recertification) and the patient is discharged on the same day as
even major modifications to a home development of a plan of care for a the admission for observation only.
health care plan. We plan to reconsider patient for whom the physician has Observation care discharge (CPT code

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00034 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations 65409

99217) may be used only on the second or greater than 8 hours, but less than 24 hospital and observation admission/
or subsequent days for observation care. hours. discharge codes should be used when a
These policies also result in different In addition to the documentation patient is admitted and discharged on
payments for patients whose inpatient guidelines for history, physical different calendar dates.
stay is less than 24 hours based solely examination, and medical decision In view of the foregoing explanation,
on whether they were in the hospital at making described in CPT 2000 for CPT
our policy is as follows:
midnight. For example, a physician who codes 99234 through 99236, we
admits a patient to observation or to proposed requiring the following to be • The relative work values of CPT
inpatient care at 8 a.m. and then documented in the medical record: codes 99234 through 99236 will remain
discharges the patient at 8 p.m. the same • A stay involving 8 hours, but less unchanged.
day is paid for only the admission than 24 hours. • For a physician to appropriately
service. On the other hand, a physician • The billing physician was present report CPT codes 99234 through 99236
who admits a patient to observation or and personally performed the services. for Medicare payment, the patient must
to inpatient care at 8 p.m. and then • The admission and discharge notes be an inpatient or an observation care
discharges the patient at 8 a.m. the next were written by the billing physician. patient for a minimum of 8 hours on the
day, is allowed payment for both the Comment: A number of commenters
same calendar date.
admission and discharge services. disagreed with our proposal. They
stated that we recently accepted the • When the patient is admitted to
In response to these concerns, and to observation status for less than 8 hours
clarify our payment policy, we proposed work values for CPT codes 99234
through 99236 and should not make on the same date, then CPT codes 99218
the following: through 99220 should be used by the
changes now. They also stated that,
Inpatient Stay of 24 Hours or More instead of finalizing our proposal, we physician and no discharge code should
We would pay for both inpatient should change our payment policy in be reported.
hospital admission services (CPT codes the MCM regarding payment for • When patients are admitted for
99221 through 99223) and hospital hospital admissions and discharges on observation care and then discharged on
discharge services (CPT codes 99238 the same day. Other commenters said a different calendar date, the physician
and 99239) when a patient is a hospital that the proposed documentation should use CPT codes 99218 through
inpatient for a period of 24 hours or requirements were onerous. These 99220 and CPT observation discharge
more. The medical record would have to commenters said that the work value for code 99217.
document that the patient was an discharging a patient on the same day as
• When patients are admitted to
inpatient for at least 24 hours for both admission to the hospital or observation
inpatient hospital care and then
of these services to be paid. was the same as the work value for
discharged on a different calendar date,
discharging a patient in the hospital for
Inpatient or Observation Stay of Less the physician should use CPT codes
one or more days.
Than 8 Hours Response: We agree with the 99221 through 99223 and CPT hospital
commenters that the work value for discharge day management codes 99238
If a patient is admitted as a hospital or 99239.
inpatient or an observation care patient discharging a patient on the same day as
for less than 8 hours, we will pay for admission is similar to the work value • For an inpatient admission and
only the admission service (CPT codes for discharging a patient on subsequent discharge less than 8 hours later on the
99221 to 99223 or 99218 to 99220) on days. same calendar date, CPT codes 99221
that day. The discharge service is not a We disagree with the commenters on through 99223 should be used for the
separately billable service. the subject of documentation. We do not admission service, and the hospital
believe it is onerous to require a discharge day management service
Inpatient or Observation Stay of 8 or physician to document the length of should not be billed.
More Hours, But Less Than 24 Hours time the patient remains in observation • The physician must satisfy the
If a patient is admitted as a hospital status. Minimal documentation, such as documentation requirements for both
inpatient or an observation care patient noting the hours in observation status, admission to and discharge from
for a period of 8 or more hours, but less is required in the medical record to do inpatient or observation care to bill CPT
than 24 hours, we will pay for both the this. There are other reasons to codes 99234, 99235, or 99236. The
admission and discharge services under document the time a patient was seen length of time for observation care or
CPT codes 99234 through 99236 with and orders were written. For example, treatment status must also be
the following proposed physician work such documentation allows physicians documented.
RVUs and documentation requirements: and facilities to improve the quality of
care they deliver. We also continue to We believe that this policy meets the
Physician Work RVUs believe that a recorded time requirement concerns of the commenters and allows
To properly value both the admission is necessary to assure that patients are us to resolve the discrepancies in
and discharge work of these services, we truly being observed and treated for payment policy regarding same day
proposed to continue valuing the conditions that require ongoing care. hospital and observation care admission
admission portion of the physician work Regarding payment for admission and and discharge.
as equivalent to CPT codes 99218 discharge on the same day, we have Result of Evaluation of Comments
through 99220 (or CPT codes 99221 long established policy that we will pay
through 99223) and to reduce the for only one E/M service per physician The work RVUs for CPT codes 99234
discharge work RVUs from 1.28 to 0.67. per patient per day for the same through 99236 used for reporting
Thus, the work RVUs would be as diagnosis, and we do not wish to revisit admission for observation care, or
follows: CPT code 99234—1.95 RVUs; that policy. inpatient hospital care and discharge on
CPT code 99235—2.81 RVUs; CPT code Admission and discharge of a patient the same calendar date will not be
99236—3.66 RVUs. Our policy would from observation or the hospital on the changed. The policies outlined above
allow payment for CPT codes 99234 same calendar date should be billed as must be followed when reporting these
through 99236 only for stays of equal to CPT code 99234 or 99235 or 99236. The codes.

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00035 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
65410 Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations

G. Ocular Photodynamic Therapy and practice expense inputs for services in proposal. We will establish RVUs for
Other Ophthalmological Treatments the non-facility setting were as follows: this G code as described in a response
Ocular photodynamic therapy (OPT) • Clinical Staff Time. Registered found later in this section.
nurse/ophthalmology technician—5 Comment: We received comments
is a treatment recently approved by the
minutes; from physician groups agreeing with our
Food and Drug Administration for age-
• Supplies. Ophthaine, mydriacil, proposal to establish three G codes for
related macular degeneration, the most
myolfrin, and gonisol. transpupillary thermotherapy (TTT),
common cause of blindness in the In addition, we identified several feeder vessel technique, and destruction
elderly. For CPT 2000, ocular other specific ophthalmological of macular drusen. It was also pointed
photodynamic therapy was added to treatments that are not distinctly out that these services are not
CPT code 67220, which was formerly identified in CPT 2000. We proposed to necessarily experimental, as we had
limited to photocoagulation by laser. establish specific HCPCS codes for these stated in the proposed rule. All of these
Because we believe that OPT is procedures: commenters said that coding these
significantly different from laser ‘‘Destruction of localized lesion of procedures as CPT 67220 was
photocoagulation, we proposed to choroid (e.g., choroidal inappropriate because the work
establish new HCPCS codes that neovascularization); transpupillary involved in performing these three
specifically identify these procedures as thermotherapy, one or more sessions’’; procedures was substantially less than
follows: ‘‘Destruction of localized lesion of the work required for 67220. These
Gxxx5—‘‘Destruction of localized choroid (e.g., choroidal commenters also agreed with our goal of
lesion of choroid (e.g., choroidal neovascularization); photocoagulation, tracking the utilization of these services
neovascularization); photocoagulation feeder vessel technique, one or more and offered to assist us in developing
(e.g., by laser), one or more sessions.’’ sessions’’; and national payment policy when
We proposed using this code in place of ‘‘Destruction of macular drusen, appropriate. One commenter,
CPT code 67220 and maintaining the photocoagulation, one or more representing a laser manufacturer,
work and malpractice RVUs and the sessions’’. recommended continuing to allow TTT
CPEP inputs presently used for CPT We did not propose RVUs for HCPCS to be coded as 67220. Although this
code 67220 for payment of this new ‘‘G’’ codes Gxxx8 through Gxx10 and commenter stated that the work of TTT
code. indicated that the procedures was similar to the work of 67220, no
Gxxx6—‘‘Destruction of localized represented experimental procedures rationale was submitted for this
lesion of choroid (e.g., choroidal and that the codes would be used for comparison.
neovascularization); ocular tracking purposes. Response: We agree with the
photodynamic therapy (includes Since publication of the proposed commenters who supported our
intravenous infusion).’’ We proposed a rule, the AMA CPT editorial panel has proposal and are finalizing it. However,
value of 0.55 work RVUs and 0.52 RVUs approved a CPT code for Ocular coverage and payment for these G codes
for the malpractice component with a Photodynamic Therapy, CPT code will be at the discretion of each carrier.
global period of ‘‘XXX.’’ 67221, effective for CPT 2001, and We want to thank the commenters
We also proposed the following removed the procedure as an example of offering to assist us in developing
practice expense inputs for non-facility a service included in CPT code 67220. national payment policy at the
settings: In addition, verteporfin has been appropriate time. We will review the
• Clinical Staff Time. Registered approved for inclusion in the United frequency with which these procedures
nurse/ophthalmology technician—40 States Pharmacopeia and can now be are performed on Medicare
minutes; billed separately as a drug under the beneficiaries, and, when there is
• Supplies. Ophthaine, mydriacil, Medicare program. sufficient Medicare experience with this
myolfrin, gonisol, post myd spectacles, Comment: Several commenters procedure, we will consider
verteporfin and also infusion supplies requested that we withdraw our development of national payment
including sterile and non-sterile gloves, proposal to establish a G code for OPT policies for these services.
butterfly needle, syringe, band aid, in view of the establishment of a CPT Comment: Several national
alcohol swab, staff gown, iv infusion set, code for this service. These commenters ophthalmologic organizations submitted
and infusion pump cassette; also recommended that we continue to detailed information and
• Equipment. Laser, infusion pump, recognize CPT code 67220 with its recommendations regarding work RVUs,
and exam lane. We noted that, while we current RVUs. practice expense inputs, and
proposed establishment of procedure Response: We agree with the malpractice RVUs for OPT.
codes for ocular photodynamic therapy, commenters and are withdrawing our Comment: Regarding work RVUs, the
coverage of the procedure is at the proposed G code for OPT. We will physician organizations submitted a
discretion of the local carrier. establish RVUs for CPT 67221 as joint recommendation of 5.08 work
In instances where both eyes are described below. We will also continue RVUs for this service based on a RUC
treated the same day, we proposed the to recognize CPT code 67220 and will survey and comparison of OPT to
use of the following HCPCS add-on maintain its current RVUs. We are similar retinal procedures such as CPT
code: Gxxx7—‘‘Destruction of localized removing verteporfin from the supplies codes 67141 and 67210 and the similar
lesion of choroid (e.g., choroidal included in practice expenses because photodynamic procedure 43228 and
neovascularization); ocular the drug is now separately billable 96570.
photodynamic therapy (includes under Medicare. Response: Based on comments
intravenous infusion) other eye.’’ (List Comment: We received comments in received from specialty societies and a
separately in addition to Gxxx6.) For agreement with our proposal to comparison of the work values for this
this add-on code we proposed a ‘‘ZZZ’’ establish an add-on G code for OPT procedure with the work values for CPT
global period, with .28 work RVUs (half performed on a second eye at the same code 67210 (Destruction of localized
of that proposed for Gxxx6) and .52 sitting. lesion of retina), we have assigned 4.01
malpractice RVUs (identical to that Response: We agree with the work RVUs to this service. The
proposed for Gxxx6). The proposed commenters and are finalizing this intraservice times and work intensities

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00036 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations 65411

for CPT codes 67210 and 67221 are • Supplies. Opthaine, mydriacyl, reporting critical care. Therefore,
comparable. Therefore, adjusting for the myolfrin, gonisol, infusion kit (includes separate payment would not be made
work value of the postoperative visits all infusion supplies), gloves, drape, for this procedure when provided in
(because CPT code 67210 has a 90-day gown, band aid. conjunction with critical care services
global period) and the 20 percent For G0184 ‘‘Destruction of localized (CPT codes 99291 and 99292).
retreatment rate included in CPT code lesion of choroid (e.g., choroidal Comment: There was general
67210 and then applying the neovascularization); ocular agreement with the proposed direct
intraservice work intensity of CPT codes photodynamic therapy (includes practice expense inputs. Commenters
67210 and 67221 yields an appropriate intravenous infusion) other eye’’ which agreed that, although the amount of time
work value for CPT 67221. In addition, is the add-on code for ocular for the procedure can vary, the typical
we are assigning a 0-day global period photodynamic therapy of the second time is 15 minutes. They noted that the
to this code, since this most accurately eye, we are establishing a work RVU price for the sensors per treatment was
reflects the pre-, intra-, and post-service 0.47 and a malpractice RVU of 0.52. The higher than the type of sensors used in
work and practice expense RVUs for following direct inputs will be used for an EKG. Commenters also indicated that
this procedure. calculating practice expense: the average cost of the bioimpedance
Comment: Commenters agreed that • Supplies. Opthaine, mydriacyl, monitor was $27,000 (we had priced the
the work value for performing OPT on myolfrin, and gonisol. equipment at $22,790). A specialty
a second eye at the same session as the In addition, we are establishing the group provided direct practice data
first eye was 10 percent of the work following HCPCS codes for other obtained from a survey they had
value for the first eye. This was felt to ophthalmologic procedures: conducted. The data reflected similar
be uniform for pre-, intra-, and post- G0185 for ‘‘Destruction of localized supplies as proposed, with the addition
service work. lesion of choroid (e.g., choroidal of alcohol swabs and also stated the
Response: We agree with the neovascularization); transpupillary price of the equipment was $26,225.
commenters and are establishing a work thermotherapy, one or more sessions’’; These data also reflected a clinical staff
RVU of 0.47 for G0184, the add-on code G0186 for ‘‘Destruction of localized (registered nurse) time of 29 minutes.
for the second eye. The global period for lesion of choroid (e.g., choroidal Response: For the practice expense
this code will be ZZZ as proposed. neovascularization); photocoagulation, inputs, we are adjusting the cost used
Comment: Commenters agreed with feeder vessel technique, one or more for the bioimpedance monitor
our crosswalk of malpractice RVUs from sessions’’; and G0187 for ‘‘Destruction (increasing the proposed amount
CPT code 67220. of macular drusen, photocoagulation, $22,790 to $25,700). In addition, the
Response: We are finalizing our one or more sessions’’. Coverage and alcohol swabs will be added to the
malpractice RVUs as proposed. payment for these G codes will be at the supplies. The specific price allocated to
Comment: Commenters submitted a discretion of each carrier. the disposable sensors was $9.95 which
list of practice expense inputs for ocular was comparable to the $9 to $10 range
photodynamic therapy. H. Electrical Bioimpedance reflected in the comments received;
Response: We agree with the practice Electrical bioimpedance (EB), a therefore, no change is being made to
expense inputs submitted by the noninvasive method of measuring the price of the sensors. We are making
commenters; however, we are adjusting cardiac input, is a covered procedure no adjustment to the clinical staff time
the registered nurse time to eliminate a under Medicare, if medically necessary. because, based on further discussions
duplication in the counting of tasks Performance of this procedure is and observation of the service being
reflected in their comments (reduction reported by the Level 2 HCPCS code performed, we believe 15 minutes of
of two minutes) and have omitted the M0302, and the procedure is currently registered nurse time is reasonable.
lens, which is reusable. A list of the carrier-priced. In the July 17, 2000 rule, Comment: While some commenters
direct inputs for practice expense is we proposed the following RVUs for agreed with the proposed value of .02
provided below under ‘‘Result of this procedure: for malpractice, a few commenters
Evaluation of Comments’’. indicated that the proposed value of .02
1. Practice Expense for malpractice was slightly low. They
Result of Evaluation of Comments recommended a value of .06 that is the
We proposed the following direct
We will continue to recognize CPT inputs for determining practice expense malpractice RVU for CPT code 93720
code 67220 ‘‘Destruction of localized RVUs. (plethysmography).
lesion of choroids (e.g., choroidal • Clinical staff time. Registered Response: We will finalize our
neovascularization); photocoagulation, nurse—15 minutes. proposal of .02 RVUs for the malpractice
one or more sessions, (e.g., by laser)’’ • Supplies. Four disposable sensors, component of this service because we
with its current RVUs. We are patient gown, exam table paper, and continue to believe it is most similar to
recognizing new CPT 67221 pillowcase. the malpractice component for an EKG.
‘‘Destruction of localized lesion of • Equipment. Cardiac output monitor Comment: Commenters recommended
choroids (e.g., choroidal and exam table. work values ranging from 0 work RVUs
neovascularization); photodynamic to work RVUs similar to EKG
therapy (includes intravenous 2. Malpractice Interpretation (CPT code 93010), Total
infusion)’’ for ocular photodynamic We proposed 0.02 RVUs for this Body Plethysmography (CPT code
therapy and establishing a work RVU of procedure. 93720), Exercise Tolerance Test (CPT
4.01, a malpractice RVU of 0.52 and code 93018), Cardiac Output
3. Physician Work Measurement by thermodilution (CPT
using the following direct inputs for
determining practice expense: We stated that with respect to RVUs code 93561) and Echocardiography
• Clinical Staff Time. Registered for physician work, we had insufficient (CPT code 93320).
nurse—65 minutes; Certified information to propose a work value Response: The physician work
ophthalmology technician—14 minutes; and invited comments on this subject. required for performance of this service
• Equipment. Laser, infusion pump, We also proposed that the payment involves reading and interpreting a
exam chair and slit lamp; and, for this procedure be included in series of numerical measurements. This

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00037 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
65412 Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations

is generally done in conjunction with an Result of Evaluation of Comments of a pacemaker or cardioverter
evaluation and management service For HCPCS code M0302, we are defibrillator.
because the measurements produced by Our proposed policy was intended to
establishing a work RVU of .17, a
this procedure are difficult to interpret facilitate separate payment for the
malpractice value of .02 and are using
without a clinical evaluation of the evaluation and management services
the following inputs for PE
patient. To determine what, if any, work unrelated to the surgical service. Our
• Clinical Staff Time. Registered
RVUs to establish for this procedure, we concern was that the 90-day global
nurse—15 minutes.
identified physician work that would be period was precluding separate payment
• Supplies. Four disposable sensors,
attributed to this procedure and would for the evaluation and management
patient gown, exam table paper,
not be billed as part of an evaluation services. However, we received
pillowcase, and four alcohol swabs.
and management service. comments that indicated that
• Equipment. Cardiac output monitor
cardiologists do not typically provide
The fact that the information gained and exam table (using a price of $25,700
the post-operative services related to
from a test is used in making treatment for the monitor).
surgical service. If this is the case, we
decisions is irrelevant to the issue of We note that there is a TC and a PC
believe that a 0-day global period is
determining physician work (for for this service. The direct practice appropriate for these procedures.
example, results of urinalyses, complete expense inputs listed above will be part Moreover, if the comment is accurate,
blood counts (CBCs) are used to make of the TC. the current (not the proposed) work and
clinical decisions, but these tests do not I. Global Period for Insertion, Removal, practice expense RVUs are likely
contain a physician work component). and Replacement of Pacemakers and overstated because these values are
For example, it is possible to make an Cardioverter Defibrillators based on one physician providing both
electrocardigraphic diagnosis (for the surgical and post-operative services.
example, left ventricular hypertrophy, We proposed to change the global
In general, we believe that the
acute Myocardial Infarction, Heart period for the insertion, removal, and
refinement process is useful for
Block) through analysis of the replacement of pacemakers and
revaluing services when the nature of
waveforms on an EKG without a clinical cardioverter defibrillators (CPT codes
the service has changed from its
evaluation of the patient. This 33206, 33207, 33208, 33212, 33213,
previous valuation. If the commenters
separately identifiable work is what 33214, 33216, 33217, 33218, 33220,
are correct, the issue of the global period
justifies establishment of work RVUs for 33233, 33234, 33235, 33240, 33241,
and appropriate relative value units for
interpretation of EKGs. It is not as easy 33244, 33249, 33282, and 33284) to 0
these services will need further review.
to identify separately identifiable work days. This would permit separate
We look forward to working with the
in the case of cardiac bioimpedance. payment for any care furnished during
physician community to better
The measurements produced by cardiac the post-operative period by the
understand the typical practice with
bioimpedance include blood pressure, physician who performed the
regard to the provision of services
pulse, cardiac output, vascular pacemaker or cardioverter defibrillator
related to insertion, removal and
resistance and thoracic fluid content. procedure. We also proposed an
replacement of pacemakers and
Generally, abnormalities in any of these adjustment to the physician work RVUs
cardioverter defibrillators. We welcome
and practice expense inputs to reflect
do not allow a diagnosis to be made (for any review of this issue that may be
the change in global period for these
example, hypertension or heart failure). undertaken by the RUC as part of their
These measurements are used to recommendation related to the 5-year
Comment: Several physician
provide additional information to a review of work and the PEAC on issues
organizations recommended withdrawal
physician who is clinically evaluating a related to practice expense.
of this proposal. They commented that Nevertheless, we are not finalizing
patient, in much the same way that
the proposed reduction in work and our proposal with respect to this issue
results of a CBC and urinalysis are used.
payment for these codes was too drastic because we believe that physicians have
However, after reviewing the comments,
and was inappropriate since most of the raised valid concerns that the
we currently believe there is a small
work in these procedures was adjustment to the work RVU in the
amount of physician work in intraservice work. They also stated that
interpreting the measurements proposal may result in an
physicians who insert pacemakers and underpayment for the service. Until
produced by cardiac bioimpedance that cardioverter defibrillators generally do
is not billable as part of an E/M service. there is further review of this issue, we
not see their patients postoperatively are continuing with current pricing for
For example, if a physician reviews, and do not render any postoperative
interprets, and issues a report, then these services and the use of a 90-day
care for related conditions. global period.
separate work can be identified. Response: We are deferring this
We believe that this physician work is proposal because of the concerns raised Result of Evaluation of Comments
most similar to the work of interpreting about the adjustment to the work RVU No change will be made to the global
an EKG and have assigned a work RVU under our proposed policy. period for CPT codes 33206, 33207,
of .17 for the professional component of Nonetheless, we believe that some 33208, 33212, 33213, 33214, 33216,
cardiac bioimpedance. We wish to commenters have raised points that, if 33217, 33218, 33220, 33233, 33234,
emphasize that in order for the PC to be accurate, suggest that a 0-day global 33235, 33240, 33241, 33244, 33249,
billed, all the requirements for billing a period and adjustment to the work RVU 33282, and 33284 in this rule.
diagnostic test must be satisfied. We is appropriate. We proposed this policy
will also bundle the PC into critical care because of our concern that J. Antigen Supply
when critical care services are cardiologists are providing post- In the July 2000 rule we proposed
furnished, since the critical care service operative services during the 90-day amending § 410.68(b), Antigens: Scope
includes the review of such tests. global period, as well as evaluation and and conditions, to change the limitation
Furthermore, we will allow this service management services to treat underlying of antigen supply from 12-weeks to 12-
to be billed once per physician, per heart conditions that are unrelated to months to be more reflective of current
patient, per day. the insertion, removal and replacement industry standards and guidelines.

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00038 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations 65413

Comments: The majority of direction of a physician, and is inputs for practice expense are subject
commenters, including national and appropriately reported as CPT code to refinement.
State specialty associations, supported 20979, ‘‘Low intensity ultrasound
L. Implantation of Ventricular Assist
this change and indicated that it was not stimulation to aid bone healing,
only reflective of current industry noninvasive (nonoperative)’’. This
standards but would improve patient service is comparable to the service In the July 2000 rule, we proposed to
care and benefit patients and provided under CPT code 20974 revise the practice expense RVUs
practitioners alike. However, a few ‘‘Electrical bone stimulation to aid bone associated with the CPT codes 33975
commenters did not agree with this healing; noninvasive (nonoperative)’’. and 33976 (implantation of ventricular
revision, and felt that stability of the Both are training sessions provided to a assist devices) to reflect an ‘‘XXX’’
extracts over time is still questionable. patient once per course of treatment by global period. The purpose of this
They recommended that the 12-weeks a physician or under a physician’s revision was to ensure that the practice
limitation be maintained, or that it be direction. Based on this, and in light of expense RVUs reflect the global period
changed to no more than 6 months. concerns raised on the interim RVUs change published in the April 11, 2000
Response: We continue to believe that contained in last year’s final rule, we correction notice (65 FR 19332) to the
revising the regulation is appropriate, so will crosswalk the work RVUs and the November 1999 final rule. No comments
that it is reflective of current industry malpractice RVUs for CPT code 20974 were received on this proposal and we
standards. To the extent that the 12- to CPT code 20979. We will use the are finalizing it as proposed.
month time period is inappropriate for following direct inputs for determining
specific antigens, it is a physician’s III. Other Issues
practice expense:
responsibility to assure that the clinical • Clinical Staff Time. Technician—45 A. Incomplete Medical Direction
potency of the antigen is preserved by minutes. We currently do not have a national
furnishing a supply of antigens for a • Equipment. Exam table. policy that instructs carriers on the
shorter time frame. The revision to the • Supplies. Minimum visit package. method of payment for a service when
regulation simply allows a physician to In addition, we are assigning a global the anesthesiologist does not fulfill all
furnish a 12-month supply of antigens period of ‘‘XXX’’. However, we expect the medical direction requirements. One
when the physician believes it is that CPT code 20979 will be billed only option carriers may use is instructing
appropriate, based on the specific once per treatment period, and we will the anesthesiologist to report this
antigens involved. require the use of the -25 modifier with service as a reduced or unusual service
Result of Evaluation of Comments any E/M service billed by a physician to determine appropriate payment. We
We are revising the regulation at for the same patient on the same day as did not make a specific proposal, but
§ 410.68(b) as proposed. CPT code 20979. Therefore, any E/M indicated that we would like to clarify
service billed in addition to CPT code this policy. We outlined possible
K. Low Intensity Ultrasound 20979 must be distinct and separately options in the July 2000 proposed rule
We proposed to remove the RVUs that identifiable. that could be alternatives for future
were assigned to CPT code 20979, low Comment: One commenter agreed rulemaking consideration. We requested
intensity ultrasound stimulation to aid with our proposed elimination of RVUs comments, particularly from physicians
bone healing. We made this proposal for this code, and requested that we and practitioners most affected by this
because of concerns raised by eliminate all RVUs for status N codes policy.
commenters, and because the service (that is, codes that are non-covered by We received comments from both of
was a noncovered service under Medicare). The commenter felt that the the major anesthesia groups, the
Medicare. RVUs associated with status N codes American Society of Anesthesiologists
Comment: One specialty organization may contain overvalued and the American Association of Nurse
pointed out that on July 31, 2000, misrepresentations and that since non- Anesthetists, as well as a few state
subsequent to publication of the governmental insurers use the Medicare anesthesiology groups and practicing
proposed rule, a HCFA National Fee Schedule as a basis for payment, use anesthesiologists. We will review these
Coverage Decision Memorandum was of RVUs for status N codes grossly suggestions as we determine whether to
issued stating that ultrasound misrepresents equitable payment for make a future proposal.
stimulation for the treatment of these types of services.
B. Payment for Pulse Oximetry Services
established nonunions is now covered Response: As noted in the response
under Medicare. above, based on the National Coverage In the July 2000 proposed rule, we
Response: As pointed out by the Decision Memorandum, we are clarified that we will continue to pay
commenter, since publication of our retaining the RVUs for CPT code 20979 separately for certain diagnostic codes,
proposed rule on July 17, 2000, a in the Medicare fee schedule. We will including pulse oximetry (CPT codes
National Coverage Decision has been further review issues related to 94760 and 94761), when they are
made that states that low intensity publishing RVUs for non-covered medically necessary and there are no
ultrasound will be covered by Medicare services and may address it in future other services payable under the
as a treatment modality for nonunion of rulemaking. physician fee schedule billed on the
extremity fractures. This restricted same date by the same supplier.
coverage takes effect on April 1, 2001. Result of Evaluation of Comments Comment: Commenters were
Therefore, this service will be We are assigning .62 work RVUs and appreciative of the policy clarification;
noncovered until that time. Although .04 malpractice RVUs to CPT code however, they continue to believe that
low intensity ultrasound was approved 20979 (which are the values also used we should allow separate payment for
under the durable medical equipment for CPT code 20974) and the direct this service when provided in
benefit, a single training session for the inputs of: technician time of 45 min., an conjunction with other services,
patient in the use of the device is exam table, and minimum supply particularly after years of paying
required. This session is generally package will be used to determine separately for this service. Under
provided by a physician, or under the practice expense. We note that the current policy, physicians are unable to

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00039 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
65414 Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations

receive payment for the practice in private practice and employed service. Moreover, there is no ‘‘incident
expense associated with the service if it directly by the therapist, by the to’’ provision in the physical therapy
is provided on the same day as another partnership or group to which the benefit, unlike the physician services
service (for example, E/M). Commenters therapist belongs. We did not make a benefit. However, a physician may
continue to believe that there is proposal, and the discussion was employ a therapist, and the services of
additional identifiable work involved provided for informational purposes the therapist may be billed as ‘‘incident
that should be paid by Medicare. One only. We felt that this explanation was to’’ the physician’s services if all the
commenter stated that this activity is necessary, since revisions in the requirements of section 2050 through
not included in an E/M vignette, and November 1998 final rule (63 FR 58814) 2050.1 of the MCM are met.
thus, it should not be bundled into an had prompted confusion in the therapy Comment: A revision in section
E/M service. industry. They believed that we had 2050.2 of the MCM is urged by a
Response: As explained in last year’s misinterpreted the supervision psychiatric association to allow
final rule, we believe pulse oximetry is requirement or had established a new physicians who own a practice to be off
no more resource intensive, and requirement for therapy assistants in the the premises when other legally
arguably less so, than recording the private practice setting. We wanted to authorized practitioners, for example,
patient’s temperature, another example clarify that the requirements for therapy psychologists and clinical social
of a diagnostic service for which we do assistants in a private practice setting workers are present. An analogy to
not make separate payment. Because had not changed from the longstanding physical therapists in private practice
this technology has progressed and been requirements established in Medicare was provided.
simplified and reduced in cost, pulse Carriers Manual (MCM) instructions Response: The regulatory change that
oximetry is a routine, minor part of a (see section 2215F, HCFA Pub. 6) allowed physical therapists in private
procedure or visit. We will continue to revised in 1981. practice to be off the premises when
bundle payment for CPT codes 94760 Comment: Two therapy associations other qualified therapists are present
and 94761 when they are provided the asserted that we have established a new resulted from Congressional statements
same day as other services. The supervision requirement for therapy in both the House and Senate committee
interpretation of pulse oximetry is part assistants in the private setting. They reports associated with our fiscal year
of the medical decision making base their assertion upon an analysis of 1997 appropriations process. To address
included in the E/M service. The the legislative and regulatory history the concerns expressed in these reports,
medical decision making process pertaining to supervision of therapy we revised the regulations at
involves the physician’s assessment and assistants in a private practice setting. §§ 410.59(c)(2) and 410.60(c)(2). With
treatment plan unique to the individual According to the associations, we respect to the commenters reference to
patient. CPT vignettes are examples and should state in this rule that direct section 2050 of the MCM, this section
do not necessarily include every supervision, rather than personal discusses services and supplies
potential activity which may occur in supervision, is required for therapy furnished ‘‘incident to’’ a physician’s
the medical decision making process. assistants in the private practice setting. professional services. As stated in
Comment: One commenter pointed In addition, they requested this section 2050.2 of the MCM, in order for
out that we require an arterial blood gas statement because Medicare carriers are the services of a nonphysician
(ABG) or pulse oximetry for patients now examining claims prior to 1999, practitioner to be covered as incident to
requiring oxygen, and that an ABG is a and seeking money from therapists for the services of the physician, the
more expensive service than pulse services furnished without the therapist services must meet all the requirements
oximetry, and also can be more being ‘‘in the room’’ with the therapy for coverage specified in sections 2050
burdensome to the patient. Therefore, assistant. through 2050.1. There is no analogy
we should continue to reimburse for Response: In light of the comments between physicians and therapists in
this service. received, we are carefully examining this circumstance, because there is no
Response: As previously explained, this issue. We did not propose any similar benefit covering services and
we will make separate payment for change in the supervision requirement supplies provided incident to a
pulse oximetry services (CPT codes for therapy assistants in the private therapist’s professional services. We
94760 and 94761) when it is medically setting in the final rule published have, therefore, no plans to revise
necessary and there are no other November 2, 1998 (63 FR 58860). Any section 2050.2 of the MCM. We would
services payable under the physician fee change in the level of supervision also note that some practitioners, such
schedule billed on the same day by the would need to be addressed in a future as clinical psychologists and clinical
same supplier. proposed rule. social workers, have a statutory benefit
Comment: Two medical associations under Medicare, and may provide and
Result of Evaluation of Comments requested clarification as to whether a bill for services without supervision of
We will continue with the policy of physical therapist could bill for services a psychiatrist.
bundling payment for pulse oximetry without ever providing or supervising
(CPT codes 94760 and 94761) when it the performance of that service. In D. Outpatient Therapy Caps
is provided on the same day as another addition, clarifications were requested Section 221 of the BBRA placed a 2-
service. Separate payment for these about the application of the physical year moratorium on Medicare Part B
codes may be made only when the therapy supervision policy and the outpatient therapy caps (the $1500 cap
services are medically necessary and ‘‘incident to’’ rules applicable to the on outpatient physical therapy services
there are no other services payable physician services benefit. including speech language-pathology
under the physician fee schedule billed Response: First, we note that the services and the $1500 cap on
on the same date by the same supplier. physical therapy supervision policy outpatient occupational therapy services
only relates to the therapist in the in all nonhospital settings). The two
C. Outpatient Therapy Supervision private practice setting. A therapist $1500 caps were implemented in 1999
In the July 2000 proposed rule, we cannot bill for services that he or she as required by the BBA.
clarified that therapy assistants must be has not either personally performed or The BBRA also requires us to submit
personally supervised by the therapist supervised the performance of the to the Congress a report by January 1,

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00040 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations 65415

2001 that includes recommendations the G codes to determine if a future CPT procedure coding system for the coding
on—(1) the establishment of a code is appropriate. of all physicians’ services.
mechanism for assuring appropriate Frequently, we create G codes to In summary, we support the use of
utilization of outpatient therapy reflect our own coverage and payment CPT codes. We establish G codes only
services; (2) the establishment of an requirements. These requirements are when absolutely necessary. We would
alternative payment policy for usually very specific, and may make it like to assure the medical community
outpatient therapy services based on inappropriate to create a CPT code for that we will continue work with the
classifications of individuals by general use. AMA CPT Editorial Panel to minimize
diagnostic category, functional status, Moreover, in response to requests the need for G codes. However, we have
prior use of services (in both inpatient from physicians and others, we make the responsibility for developing and
and outpatient settings), and other coverage decisions on a rolling basis. implementing payment policy for the
criteria, in place of uniform dollar Because the CPT process requires at Medicare program. On occasion, we
limitations, and (3) how to do this in a least 1 year between approval and need to establish G codes to
budget-neutral manner. implementation of a CPT code, we must appropriately administer the Medicare
In the July 17, 2000 rule, we provided create a G code during the interim. We program.
examples of informal recommendations occasionally have specific coverage and F. Work RVUs in Proposed Rule
we have received on this issue, and payment requirements according to
asked for comments from the public on which Medicare payment is not made Comment: A few commenters stated
other alternatives that we might for a specific CPT code. This was the that work RVUs for some services were
consider in developing a payment case with the revision of the care plan incorrect due to the incorrect placement
policy for outpatient therapy services. oversight codes. We specifically of the decimal in Addendum B of the
We indicated that this information informed the CPT Editorial Panel before July 2000 proposed rule (65 FR 44210).
would be considered in preparing our the codes were revised that the They requested that we correct them in
report to Congress on outpatient therapy proposed revisions would be the final rule.
services. inconsistent with our established Response: Due to a programming
payment policy, and, therefore, we error, some services were assigned
Result of Evaluation of Comments
would need to create G codes for care incorrect work RVUs in Addendum B of
Several organizations commented on plan oversight and not use the revised the proposed rule. We have taken steps
the issue of outpatient therapy caps. CPT codes. Similarly, we are finalizing to ensure that this programming error is
Some groups responded to the examples our proposal to create G codes for corrected.
provided in the proposed rule, while several ophthalmologic procedures to
G. Five-Year Refinement of Relative
others offered other alternatives. We track the use of these services and
Value Units
appreciate the information provided and permit coverage and payment on a
will consider it as we develop the report carrier-by-carrier basis. We had In the July 17, 2000 proposed rule (65
to Congress. comments from the appropriate medical FR 44201), we included a discussion on
specialty societies, and determined that the activities underway with respect to
E. HCPCS G Codes
it was not appropriate to create CPT the second five-year refinement of work
Several commenters recommended codes for these services at present. The RVUs. We indicated that we had
that, instead of creating G codes, we specialty societies supported our received comments on potentially
work more closely with the AMA CPT creation of the G codes; this mechanism misvalued services from approximately
Editorial Panel to establish or revise permits payment for these services 30 specialty groups, organizations and
CPT codes to meet our requirements. while establishing a way to track their individuals, involving over 900 codes.
We have a long-established working use. In the case of physician We shared these comments with the
relationship with the AMA CPT certification and recertification of a plan RUC, which makes recommendations to
Editorial Panel. We prefer the use of of care for home health services, we us on the assignment of RVUs to new
CPT codes to the use of G codes for created two new G codes because of our and revised CPT codes. We also
reporting physicians’ services. In fact, interest in providing explicit payment discussed current initiatives involving
this year, we initiated the establishment for these services as a result of the validation of physician time data.
of a new CPT code that describes ocular development of the home health Comment: Commenters expressed
photodynamic therapy (67221) for CPT prospective payment system (PPS). As concern about the discussion on five-
2001, and the revision of an old CPT we indicated in the home health PPS year review activities. They were unsure
code (67220) to remove ocular rule (65 FR 41163), we have decided to as to how the contractor activities
photodynamic therapy. We did this ‘‘focus our attention on physician outlined in the proposed rule would be
proactively to avoid the need to certification efforts and education in coordinated with the RUC
establish a G code. We, along with the order to better involve the physician in recommendations on work RVUs that
ophthalmology societies, brought these the delivery of home health services.’’ will be forwarded to us for
recommendations to the CPT Editorial While we are imposing no new consideration. Commenters also
Panel. Thus we were able to withdraw regulatory requirements on physicians expressed concern that contractor
our proposal for a G code for ocular related to these services, we felt that it activities are primarily focused on
photodynamic therapy. We also worked was important to establish these two physician time. They cautioned that
with the panel to establish CPT codes new codes quickly to allow separate other factors need to be considered in
for artificial skin placement and wound payment for these services as soon as conjunction with time (for example,
care management that will enable to us possible after implementation of the stress, physician effort, and technical
to retire our G codes for these services. home health PPS on October 1, 2000. effort) when valuing physician work.
We believe that sometimes HCPCS Use of G codes is also consistent with Response: We discussed the data
level 2 codes are useful to the CPT section 1848(c)(5) of the Act, which obtained by our contractors with the
Editorial Panel process. For example, specifically provides us with the RUC. We also discussed with the RUC
use of a new service can be tracked with authority to establish a uniform and the physician community the best

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00041 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
65416 Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations

use of the data obtained by our refinement process. In this section, we to have knowledge of the services under
contractors. summarize the refinements to the review.
Comment: One organization stated interim work RVUs that have occurred The panel discussed the work
that, during the initial five-year review, since publication of the November 1999 involved in each procedure under
budget neutrality was achieved by final rule and our establishment of the review in comparison to the work
applying an 8.3 percent reduction to all work RVUs for new and revised codes associated with other services on the fee
physician work RVUs. They strongly for the 2001 fee schedule. schedule. We had assembled a set of
encouraged us to distribute any impact reference services, and asked the panel
Work Relative Value Unit Refinements members to compare the clinical aspects
across all specialties and all CPT codes
of Interim and Related Relative Value of the work of services they believed
for the current 5-year review.
Units were incorrectly valued to one or more
Response: Based on our prior
experience, we acknowledge that there 1. Methodology (Includes Table titled of the reference services. In compiling
has been significant interest in how we Work Relative Value Unit Refinements the set, we attempted to include—(1)
make adjustments to achieve budget of the 2000 Interim and Related Relative services that are commonly performed
neutrality as a result of work Value Units) whose work RVUs are not controversial;
refinement. We will discuss potential (2) services that span the entire
Although the RVUs in the November spectrum from the easiest to the most
options and propose an adjustment to 1999 final rule were used to calculate
ensure budget neutrality resulting from difficult; and (3) at least three services
2000 payment amounts, we considered performed by each of the major
the work RVU refinement in next year’s the RVUs for the new or revised codes
proposed rule. specialties so that each specialty would
to be interim. We accepted comments be represented. The set listed
Comment: One commenter asked for a period of 60 days. We received
when the Health Economics Research approximately 300 services. Group
substantive comments from members were encouraged to make
(HER) study data discussed in the approximately 11 specialty societies on
proposed rule would be available. comparisons to reference services. The
approximately 29 CPT codes with intent of the panel process was to
Response: We anticipate that the
interim work RVUs. Only comments on capture each participant’s independent
study data will be available by
codes listed in Addendum C of the judgement based on the discussion and
December 1, 2000. We will be posting
November 1999 final rule were his or her clinical experience. Following
this information on our homepage.
considered. each discussion, each participant rated
(Access to the homepage is discussed in We used a process similar to the
the introductory section of this rule the work for the procedure. Ratings
process used in 1997. (See the October were individual and confidential, and
under SUPPLEMENTARY INFORMATION.) 31, 1997 final rule on the physician fee there was no attempt to achieve
IV. Refinement of Relative Value Units schedule (62 FR 59084) for the consensus among the panel members.
for Calendar Year 2001 and Responses discussion of refinement of CPT codes We then analyzed the ratings based on
to Public Comments on Interim Relative with interim work RVUs.) We convened a presumption that the interim RVUs
Value Units for 2000 (Including the a multispecialty panel of physicians to were correct. To overcome this
Interim Relative Value Units Contained assist us in the review of the comments. presumption, the inaccuracy of the
in the July 17, 2000 Proposed Rule) The comments that we did not submit interim RVUs had to be apparent to the
to panel review are discussed at the end broad range of physicians participating
A. Summary of Issues Discussed Related of this section, as well as those that in each panel.
to the Adjustment of Relative Value were reviewed by the panel. We invited Ratings of work were analyzed for
Units one representative from each of those consistency among the groups
Section IV.B. of this final rule specialty societies from which represented on each panel. In general
describes the methodology used to substantive comments were received to terms, we used statistical tests to
review the comments received on the attend a panel for discussion of the determine whether there was enough
RVUs for physician work and the codes on which they had commented. agreement among the groups of the
process used to establish RVUs for new The panel was moderated by our panel, and whether the agreed-upon
and revised CPT codes. Changes to medical staff, and consisted of the RVUs were significantly different from
codes on the physician fee schedule following representatives. the interim RVUs published in
reflected in Addendum B are effective Addendum C of the November 1999
Voting Members final rule. We did not modify the RVUs
for services furnished beginning January
1, 2001. • One or two clinicians representing unless there was a clear indication for
the commenting specialty(s), based a change. If there was agreement across
B. Process for Establishing Work upon our determination of those groups for change, but the groups did
Relative Value Units for the 2001 Fee specialties which are most identified not agree on what the new RVUs should
Schedule and Clarification of CPT with the service(s) in question. be, we eliminated the outlier group, and
Definitions Although commenting specialties were looked for agreement among the
Our November 2, 1999 final rule on welcomed to observe the entire remaining groups as the basis for new
the 2000 physician fee schedule (64 FR refinement process, they were only RVUs. We used the same methodology
59380) announced the final work RVUs involved in the discussion of those in analyzing the ratings that we first
for Medicare payment for existing services for which they were invited to used in the refinement process for the
procedure codes under the physician fee participate. 1993 fee schedule. The statistical tests
schedule and interim RVUs for new and • Two Primary care clinicians were described in detail in the
revised codes. The RVUs contained in nominated by the American Academy of November 25, 1992 final rule (57 FR
the rule apply to physician services Family Physicians and the American 55938).
furnished beginning January 1, 2000. Society of Internal Medicine. Our decision to convene
We announced that we considered the • Five Carrier medical directors. multispecialty panels of physicians and
RVUs for the interim codes to be subject • Four clinicians with practices in to apply the statistical tests described
to public comment under the annual related specialties, who were expected above was based on our need to balance

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00042 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations 65417

the interests of those who commented review for a variety of reasons. These • Description. This is an abbreviated
on the work RVUs against the comments and our decisions on those version of the narrative description of
redistributive effects that would occur comments are discussed in further the code.
in other specialties. Of the 11 codes detail below. • 2000 Work RVU. The work RVUs
reviewed by the multispecialty panel, The table below lists the interim and that appeared in the November 1999
all were the subject of requests for rule are shown for each reviewed code.
related codes reviewed during the
increased values. Of the 11 interim work • Requested Work RVU. This column
refinement process described in this
RVUs that were reviewed, 9 were identifies the work RVUs requested by
increased and 2 were unchanged. section. This table includes the commenters.
We also received comments on RVUs following information: • 2001 Work RVU. This column
that were interim for 2000, but which • CPT Code. This is the CPT code for contains the final RVUs for physician
we did not submit to the panel for a service. work.
2000 work Requested 2001 work
CPT code Description RVU work RVU RVU

27096 ....... Inject sacroiliac joint .............................................................................................. 1.10 1.40 1.40
61862 ....... Implant neurostimul, subcort ................................................................................. 19.34 27.34 19.34
61885 ....... Implant neurostim one array ................................................................................. 5.85 8.00 5.85
62263 ....... Lysis epidural adhesions ...................................................................................... 6.02 7.20 6.14
72275 ....... Epidurography ....................................................................................................... 0.54 0.83 0.76
73542 ....... X-ray exam, sacroiliac joint ................................................................................... 0.54 0.64 0.59
76873 ....... Echograp trans r, pros study ................................................................................ 0.99 1.92 1.55
93741 ....... Analyze ht pace device sngl ................................................................................. 0.64 0.90 0.80
93742 ....... Analyze ht pace device sngl ................................................................................. 0.73 1.03 0.91
93743 ....... Analyze ht pace device dual ................................................................................. 0.83 1.17 1.03
93744 ....... Analyze ht pace device dual ................................................................................. 0.95 1.33 1.18
*All CPT codes and descriptions copyright 2000 American Medical Association.

2. Interim 2000 Codes. Final decision: As a result of the we referred this code to a refinement
CPT code 11980 Subcutaneous statistical analysis of the refinement panel for review.
hormone pellet implantation. panel ratings, the final work RVUs are Final decision: As a result of the
We did not receive a work RVU established as 1.40 for CPT code 27096. statistical analysis of the refinement
recommendation from the RUC for this CPT code 61862 Subcortical panel ratings we are retaining the work
code, and therefore crosswalked it to neurostimulator array implantation. RVU of 19.34 for CPT code 61862.
CPT 11980 for the 2000 fee schedule. The RUC evaluated this code using a
One commenter indicated that a CPT Code 61885 Incision and
building block approach that included Subcutaneous Placement of Cranial
recommendation for work RVUs would
the work of sterotactic localization, the Neurostimulator Pulse Generator or
be included in the RUC
device implantation and 140 minutes of Receiver, Direct or Inductive Coupling;
recommendations for 2001, and urged
intra-operative testing. With Connection to a Single Electrode
that we accept this RVU
recommendation. A few commenters expressed concern Array
Final decision: The 2001 RUC about our rejection of the RUC
recommendation for CPT Code 11980 recommendation of 27.34 work RVUs CPT Code 61885 was revised to add
has been reviewed and accepted. and our proposed 19.34 work RVUs. We a delimiter to the code that specified
subtracted 8.00 RVUs attributed to 140 connection of the neurostimulator to a
CPT Code 27096 Injection Procedure minutes of intra-operative testing, since single electrode array, and a new code
for Sacroiliac Joint Arthrography and/or this time was variable and it could be (CPT code 61886) was introduced for
Aesthetic Steroid reported under other CPT codes. The situations involving two or more
We reduced the work RVU for 27096 commenters explained that the electrode arrays. We had received
from the RUC proposed value of 1.40 to assignment of surgeon work during this recommendations for work RVUs for the
1.10 based on a weighted average with 140 minutes of electrode maneuvering revised CPT code 61885, as well as the
CPT code 20610 (Large joint injection- was done by comparing the work, new CPT code 61886. Commenters
work RVU of 0.79) Commenters pointed including intensity, to CPT code 99291 disagreed with our statement that there
out that while this was one of the codes at an equivalent rate of 4.00 RVUs for was no evidence to justify an increase
used prior to approval of CPT code each of the approximately 2 hours in in the work RVU for CPT code 61885.
27096, it (20610) was cited as being this average. Information was provided We also noted that the work RVU for
inadequate, because the sacroiliac joint during the discussion at the RUC that this code had been increased in the last
injection requires more precision and the time of 140 minutes was truly an 5-year review. Commenters felt that the
skill than does a large joint (for average, with some testing requiring as RUC analyses presented supported an
example, hip) injection. They also long as 3 to 4 hours to achieve increase in the work RVU. In light of
indicated that the reduction made by satisfactory electrode placement. The these comments, we referred this code
HCFA to account for the fact that this commenters recommended that we to the refinement panel for review.
procedure may be performed without restore the missing 8.00 RVUs and Final decision: As a result of the
contrast was not justified. In light of accept the RUC recommendation of statistical analysis of the refinement
these comments we referred the code to 27.34 for this code. Due to the questions panel ratings, the final work RVUs are
a refinement panel for review. concerning our reduction of 8.00 RVUs, 5.85 for CPT code 61885.

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00043 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
65418 Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations

CPT Code 62263 Percutaneous Lysis of from the 0.83 recommended by RUC to work RVU of .67) was also previously
Epidural Adhesions Using Solution 0.54. Commenters disagreed with this used to report this service.
Injection (for Example, Hypertonic reduction, noting that the comparison Final decision: The RUC
Saline, Enzyme) or Mechanical Means codes selected by HCFA medical staff to recommended .60 work RVUs for CPT
(for Example, Spring-wound Catheter) support this reduction did not code 76005. We reduced this
Including Radiologic Localization accurately reflect the work involved. recommendation to .54 work RVUs
(Includes Contrast When Administered) They indicated that the RUC survey based upon reference procedure CPT
reflected that there was a greater amount code 76003. We inadvertently failed to
This was a new CPT code for which also examine the other reference
of time involved. This code was referred
the RUC had recommended work RVUs procedures identified on the RUC
to the refinement panel for review.
of 7.20. We reduced the value to 6.02 Final decision: As a result of our survey. Based upon the other reference
based on two determinations—(1) that statistical analysis of the refinement procedures which were listed, CPT code
the RUC had erroneously counted the panel ratings, we are assigning a work 76001 (work RVU = .67), we are
insertion of a catheter twice in RVU of 0.76 to CPT code 72275. changing the work RVU to the RUC
compiling the component services; and recommended value of .60.
(2) the appropriate building block for CPT Code 73542 Sacroiliac Joint
the fluoroscopic guidance was code Arthrography CPT Code 76873 Prostate Volume
76003, not 76005. Commenters The RUC recommended value of 0.64 Study
requested that we reconsider these work RVUs was reduced to 0.54 work We reduced the RUC recommendation
decisions. They indicated that they had RVUs based on our belief that there was of 1.92 work RVUs to .99, since we did
intentionally doubled the value for no difference in work from the primary not believe that general anesthesia is
catheter insertion, as insertion of a survey reference code (CPT code 73525 used in this procedure. Commenters
catheter into a tight scarred epidural which has a work RVU of 0.54). disagreed with this point and indicated
space involved more work than the Commenters disagreed with this that, because the patient must remain
typical epidural injection. They also felt reduction. Although the time estimates motionless during the procedure,
that the fluoroscopic code the RUC had between CPT code 73542 and the significant sedation, either general or
used was appropriate, and more reference code are similar, the mean spinal anesthesia, is used. Thus, this is
accurately reflected the work involved. intensity/complexity measures are usually performed in a hospital
In response to these comments, we consistently higher for CPT code 73542, operating room (outpatient) or
referred this code to the refinement and therefore warranted the RUC ambulatory surgical center. Commenters
panel for review. recommended work RVU of .64. The also objected to the comparison we
Final decision: As a result of our RUC valued this code not only made between this code (76873) and
statistical analysis of the refinement according to the time required, but also CPT code 76805 Echography, pregnant
panel ratings the final work RVU for according to the intensity of the service. uterus, B-scan and/or real time with
CPT 62263 will be 6.14. Commenters recommended adoption of image documentation; complete. An
CPT Codes 62310, 62311, 62318, 62319 the RUC work RVUs of 0.64 for CPT obstetric ultrasound does not require
Epidural or Subarachnoid Spine code 73542. This code was referred to anesthesia and is done in a physician’s
Injection Procedures the refinement panel for review. office. Commenters also questioned our
Final decision: As a result of our statement that we would not allow
We had agreed with the relativity of statistical analysis of the refinement payment for a prostate volume study
these new codes established by the panel ratings, we are assigning a work when performed on the same day as
RUC, but in order to retain budget RVU of 0.59 to CPT code 73542. seed implantation or other services that
neutrality within this family of codes, are part of seed implantation. During the
we had to uniformly reduce the RUC CPT Code 76005 Fluoroscopic
Guidance and Localization of Needle or RUC deliberations, it was specifically
recommended values. Commenters discussed that the prostate volume
indicated that our calculations of the Catheter Tip for Spine or Paraspinous
Diagnostic or Therapeutic Injection study was not included in the work for
amount of reduction in the work RVUs seed implantation (CPT code 55859).
needed slight adjustments. The Procedures (Epidural, Transforaminal
Epidural, Subarachnoid, Paravertebral This code was referred to the refinement
specialties involved in developing the panel for review.
work RVUs submitted the following re- Facet Joint, Paravertebral Facet Joint
Nerve or Sacroiliac Joint) Including Final decision: As a result of our
scaled work RVUs that they felt were a statistical analysis of the refinement
better reflection of the budget neutrality Neurolytic Agent Destruction
panel ratings, we are assigning a work
adjustment while preserving the intra- The RUC recommended value of 0.60 RVU of 1.55 to CPT code 76873.
family relativity of the new codes work RVUs for this new code was
(62310–1.95; 62311–1.57; 62318–2.26; reduced to 0.54, because we did not CPT Codes 90471 and 90472
and 62319–1.88). believe there was enough difference in Immunization Administration
Final decision: We reviewed the work work from the primary survey reference In the final rule published November
RVUs submitted by the specialty, and code 76003 (0.54 work RVUs). 2, 1999, we included a discussion of
found the proposed work RVUs not to Commenters disagreed with this practice expense inputs and omitted a
be budget neutral. We apply a standard determination, and indicated that the discussion of the RUC recommended
technique, using the most recent survey data results were evidence that work RVUs for these codes. Commenters
available data, to arrive at budget comparison between CPT codes 76005 encouraged us to publish the values for
neutral values. The work RVUs, as and 76003 was not appropriate, since these codes, noting that while these are
published in the November 1999 final the survey showed more time for CPT not reimbursed under the Medicare
rule will be retained. code 76005, as well as a consistently program, fee schedule values provide
higher estimation of intensity and guidance to other payers who use the
CPT Code 72275 Epidurography complexity. Commenters also pointed fee schedule.
We reduced the work RVUs for this out that another established code in the Final decision: While we realize that
new code by approximately one third, same family (CPT code 76001 with a other payers may use the RVUs under

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00044 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations 65419

the physician fee schedule, since these Response: The RUC made no either the RUC or the specialty society.
are noncovered services under recommendation on the practice Because this is a 0-day procedure that
Medicare, we are not including values expense inputs for this code, but the would only be performed in the facility
for these services in the fee schedule. Society of Thoracic Surgeons setting, there would be few or no direct
The discussion on practice expense was recommended that we crosswalk the inputs associated with the service.
erroneously included. As we indicated direct inputs from those assigned to CPT Thus, an increase in the physician work
in an earlier discussion, we will be code 33406, which we did. The involved to perform the service would
examining the issue of including values identified payment anomaly did not not lead to an increase in the practice
for noncovered services in the fee exist in the practice expense RVUs expense. CPT code 92960 also has no
schedule. published in our November 1999 final inputs in the facility setting, so
rule. There was a calculation error including that code as an added
CPT Codes 93741, 93742, 93743, 93744 reflected in the published RVU values crosswalk, as recommended in the
Electronic Analysis of Pacing in the July 2000 proposed rule (65 FR comment, would have no effect on the
Cardioverter-Defibrillator 44210) that has been corrected in this practice expense RVUs for CPT code
We reduced the RUC final rule. We hope that the code will be 92961. Therefore, we are making no
recommendations for work RVUs for refined soon, so that it will no longer be change in our recommended crosswalk.
these codes (93741–0.64; 93742–0.73; necessary to use a crosswalk for the
CPT Code 93727 Electronic Analysis of
93743–0.83, and 93744–0.95) because practice expense inputs.
Implantable Loop Recorder (ILR) System
we felt there were inconsistencies CPT Code 33249 Insertion or (Includes Retrieval of Recorded and
between the recommendations and the Repositioning of Electrode Lead(s) for Stored ECG Data, Physician Review and
survey data. Commenters stated that the Single or Dual Chamber Pacing Interpretation of Retrieved ECG Data
differences in time reflected between Cardioverter Defibrillator and Insertion and Reprogramming)
the earlier surveys and three 1998 and of Pulse Generator
1999 surveys were a result of the large Two organizations objected to our
increase in the complexity of the We received comments from two crosswalk of the practice expense inputs
organizations representing cardiology for this code from CPT code 93272,
technologies associated with these
and pacing electrophysiology on the Patient demand single or multiple event
procedures over the last few years. With
interim PE RVUs for this procedure. recording with presymptom memory
older devices, there was less
Both commenters indicated that the loop, per 30 day period of time;
information to analyze. The new
practice expense RVUs should be physician review and interpretation
technology provides more information,
increased to account for the fact that only. The commenters stated that this
thus, the work involved is significantly
under the revised definition, this crosswalk does not accurately reflect all
greater than it was when the reference
procedure now includes the the practice expense inputs associated
procedure was initially evaluated. These
implantation of dual chamber ICDs. with the service, and recommended we
codes were referred to the refinement Response: We did not receive a
panel for review. crosswalk the inputs from CPT code
practice expense recommendation on 93271, Patient demand single or
Final decision: As a result of our this revised code from either the RUC or multiple event recording with
statistical analysis of the refinement the specialty societies, and we kept the presymptom memory loop, per 30 day
panel ratings, we are assigning the practice expense inputs at their original period of time; monitoring, receipt of
following work RVUs: 93741–0.80, level. Because this is a procedure that transmissions, and analysis.
93742–0.91, 93743–1.03, 93744–1.18. would only be performed in the facility Response: We did not originally
Practice Expense Refinements of 2000 setting, an increase in the physician receive a practice expense
Interim and Related Relative Value work involved to perform the service recommendation on this revised code
Units would not lead to an increase in the from either the RUC or the specialty
practice expense, unless there would be societies. We have reviewed this
We received the following comments more post-surgical visits associated with comment, and have changed the
on the interim practice expense RVUs the revised service. No claim has been crosswalk as recommended by the
assigned to the new and revised CPT made that this is the case. Therefore, we commenters.
codes for 2000: believe that there is no justification for
increasing the practice expense RVUs. CPT 90471/72 Immunization
CPT Code 33410 Replacement, Aortic Administration and CPT 99173 Visual
Valve, With Cardiopulmonary Bypass; CPT code 92961, Cardioversion, Screening Test
With Stentless Tissue Valve elective, electrical conversion of Two organizations requested that we
A specialty group commented that the arrhythmia; internal (separate publish the RUC recommended values
practice expense RVUs for this code procedure) for these immunization codes, as well as
should be slightly higher than for CPT One organization indicated that, for the visual screening test and other
code 33406, Replacement, aortic valve, the PE inputs, we crosswalked this code services with RUC recommendations
with cardiopulmonary bypass; with to CPT code 93610, intra-atrial pacing, not reimbursed under Medicare,
homograft valve (freehand), due to the which does not include costs associated because other payors use the RVUs
difference in the grafts. However, the with a cardioversion, which is part of under the physician fee schedule.
practice expense RVUs for CPT code the procedure. They recommended that Response: While we realize that other
33410 are 0.09 less than the practice we use a building block approach, using payers may use the RBRVS fee schedule,
expense RVUs for CPT code 33406. The inputs from CPT code 93610–26 (a since these are non-covered services
commenter adds that, due to this error, similar intra-atrial pacing code) and under Medicare, as indicated above, we
physicians have received unfairly low CPT code 92960 (a similar cardioversion are not including values for these
reimbursement for this procedure in CY code) for establishing the PE RVUs. services in the fee schedule.
2000, and should receive fair Response: We did not originally We received the following comments
compensation after this error is receive a practice expense on HCPCS codes established in the
corrected. recommendation on this code from November 2, 1999 Final Rule:

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00045 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
65420 Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations

G0166 External Counterpulsation of devitalized tissue. For 2001, CPT decrease work RVUs to retain budget
One commenter indicated this service adopted a code 97601 that is sufficiently neutrality.
was undervalued and recommended similar to the services described by There were also 38 CPT codes for
inputs for this code. We continue to G0169 that we will ask providers to which we did not receive a RUC
believe that the values assigned in last utilize that code for selective removal of recommendation. After a review of these
year’s rule are appropriate, and we are devitalized tissue, and we will eliminate CPT codes by our staff and medical
retaining these values. G0169. We crosswalked the values for officers, we established interim work
G0169 to CPT Code 97601. This code RVUs for the majority of these services.
G0167 Hyperbaric Oxygen Treatment will continue to have no global period. For those services for which we could
We received comments expressing Establishment of Interim Work Relative not arrive at interim work RVUs, we
concerns about the new code, G0167, Value Units for New and Revised have assigned a carrier priced status
Hyperbaric Oxygen Treatment Not Physician’s Current Procedural until such time as the RUC provides
Requiring Physician Attendance, per Terminology Codes and New HCFA work RVU recommendations.
Treatment. The commenter requested Common Procedure Coding System
We received 5 recommendations from
that we clarify the intended use of this Codes for 2001 (Includes Table titled
the Health Care Professionals Advisory
code. Our contractors have discretion to American Medical Association
Committee (HCPAC). Two of the
cover hyperbaric oxygen with or Specialty Relative Value Update
HCPAC recommendations were reduced
without physician supervision. Our Committee and Health Care
while 3 of the recommendations were
coverage staff is currently reviewing Professionals Advisory Committee
for services that we do not cover.
hyperbaric oxygen therapy services Recommendations and HCFA’s
policies generally, including the Additionally, there were 2 services for
Decisions for New and Revised 2001
appropriate levels of physician which we did not receive
CPT Codes)
supervision. The progress of this review recommendations from the HCPAC.
One aspect of establishing RVUs for
can be tracked on our web site, 2001 was related to the assignment of The table titled AMA RUC and
http:\\, by selecting interim work RVUs for all new and HCPAC Recommendations and HCFA
Coverage Policies. revised CPT codes. As described in our Decisions for New and Revised 2001
November 25, 1992 notice in the 1993 CPT Codes lists the new or revised CPT
G0168 Wound Closure Utilizing Tissue codes, and their associated work RVUs,
Adhesives Only fee schedule (57 FR 55983) and in
section III.B. of our November 22, 1996 that will be interim in 2001. This table
One specialty was concerned that the final rule (61 FR 59505 through 59506) includes the following information:
services described by this code were not we established a process, based on • A ‘‘#’’ identifies a new code for
coded as a simple repair as recommendations received from the 2001.
recommended by the CPT panel. The AMA’s RUC, for establishing interim
commenter suggested that the cost of the • CPT code. This is the CPT code for
work RVUs for new and revised codes. a service.
supply, Dermabond, could be This year we received work RVU
reimbursed separately. Another • Modifier. A ‘‘26’’ in this column
recommendations for approximately 131
commenter was concerned about the 10- indicates that the work RVUs are for the
new and revised CPT codes from the
day global period assigned to this code. professional component of the code.
RUC. Our staff and medical officers
The work and practice expense values • Description. This is an abbreviated
reviewed the RUC recommendations by
for this code were based upon an version of the narrative description of
comparing them to our reference set or
evaluation and management visit, CPT the code.
to other comparable services for which
code 99212, except that the price of
Dermabond was added as a practice work RVUs had been previously • RUC recommendations. This
expense. We assigned these values established, or to both of these criteria. column identifies the work RVUs
because many of these wounds could We also considered the relationships recommended by the RUC.
have been closed with Steri-strips, a among the new and revised codes for • HCPAC recommendations. This
service that is also coded with which we received RUC column identifies the work RVUs
evaluation and management, rather than recommendations. We agreed with the recommended by the HCPAC.
majority of these relationships reflected
a simple repair. We will be analyzing • HCFA decision. This column
the use of HCPCS code G0168 to learn in the RUC values. In some instances,
indicates whether we agreed with the
more about the use of this product, and when we agreed with the relationships,
RUC recommendation (‘‘agree’’) or we
will consider revaluing it after that we revised the work RVUs to achieve
disagreed with the RUC
analysis is completed. work neutrality within families of
recommendation (‘‘disagree’’). Codes for
Although we believe that the typical codes, that is, the work RVUs have been
which we did not accept the RUC
service involving the use of Dermabond adjusted so that the sum of the new or
recommendation are discussed in
as the only closure will typically not revised work RVUs (weighted by
greater detail following this table. An
involve a visit for suture removal, we projected frequency of use) for a family
‘‘(a)’’ indicates that no RUC
concede that, if another visit were will be the same as the sum of the
recommendation was provided. A
needed for a complication, we should current work RVUs (weighted by
discussion follows the table.
allow another evaluation and projected frequency of use). For
approximately 91 percent of the RUC • HCFA Work RVUs. This column
management visit. For this reason, we
recommendations, proposed work RVUs contains the RVUs for physician work
will change the global period to 0 days.
were accepted, and for approximately 9 based on our reviews of the RUC
G0169 Removal of Devitalized Tissue, percent, we disagreed with the RUC recommendations.
Without Use of Anesthesia recommendation. In a majority of • 2001 Work RVUs. This column
For 2000, we created G0169 to instances, we agreed with the relativity establishes the 2001 work RVUs for
describe a service that involved removal proposed by the RUC, but needed to physician work.

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00046 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations 65421

RUC rec- HCPAC rec-
CPT* HCFA HCFA work 2000 work
MOD Description ommenda- ommenda-
code decision RVU RVU
tion tion

11980# ..... ........... IMPLANT HORMONE PELLET(S) .................... 1.48 .................... Agree ........... 1.48 1.48
15342# ..... ........... CULTURED SKIN GRAFT, 25 CM ................... 1.50 .................... Disagree ...... 1.00 1.00
15343# ..... ........... CULTURE SKN GRAFT ADDL 25 CM ............. 0.38 .................... Disagree ...... 0.25 0.25
16035 ....... ........... INCISION OF BURN SCAB, INITI .................... 3.75 .................... Agree ........... 3.75 3.75
16036# ..... ........... INCISE BURN SCAB, ADDL INCIS .................. 1.50 .................... Agree ........... 1.50 1.50
19100 ....... ........... BX BREAST PERCUT W/O IMAGE ................. 1.27 .................... Agree .......... 1.27 1.27
19101 ....... ........... BIOPSY OF BREAST, OPEN ........................... 3.18 .................... Agree ........... 3.18 3.18
19102# ..... ........... BX BREAST PERCUT W/IMAGE ..................... 2.00 .................... Agree .......... 2.00 2.00
19103# ..... ........... BX BREAST PERCUT W/DEVICE ................... 2.37 .................... Agree .......... 2.37 2.37
19120 ....... ........... REMOVAL OF BREAST LESION ..................... 5.56 .................... Agree ........... 5.56 5.56
19125 ....... ........... EXCISION, BREAST LESION .......................... 6.06 .................... Agree ........... 6.06 6.06
19126 ....... ........... EXCISION, ADDL BREAST LESION ................ 2.93 .................... Agree ........... 2.93 2.93
19295# ..... ........... PLACE BREAST CLIP, PERCUT ..................... 0.00 .................... Agree ........... 0.00 0.00
21199# ..... ........... RECONSTR LWR JAW W/ADVANCE ............. 16.00 .................... Agree .......... 16.00 16.00
22520# ..... ........... PERCUT VERTEBROPLASTY THOR .............. 8.91 .................... Agree ........... 8.91 8.91
22521# ..... ........... PERCUT VERTEBROPLASTY LUMB .............. 8.34 .................... Agree ........... 8.34 8.34
22522# ..... ........... PERCUT VERTEBROPLASTY ADDL .............. 4.31 .................... Disagree ...... 3.00 3.00
30465# ..... ........... REPAIR NASAL STENOSIS ............................. 11.64 .................... Agree ........... 11.64 11.64
33140 ....... ........... HEART REVASCULARIZE (TMR) .................... 20.00 .................... Agree ........... 20.00 20.00
33141# ..... ........... HEART TMR W/OTHER PROCEDURE ........... 4.84 .................... Agree .......... 4.84 4.84
33533 ....... ........... CABG, ARTERIAL, SINGLE ............................. 25.83 .................... Agree ........... 25.83 25.83
33534 ....... ........... CABG, ARTERIAL, TWO .................................. 28.82 .................... Agree ........... 28.82 28.82
33535 ....... ........... CABG, ARTERIAL, THREE .............................. 31.81 .................... Agree .......... 31.81 31.81
33536 ....... ........... CABG, ARTERIAL, FOUR OR MORE .............. 34.79 .................... Agree .......... 34.79 34.79
34800# ..... ........... ENDOVASC ABDO REPAIR W/TUBE ............. 20.75 .................... Agree ........... 20.75 20.75
34802# ..... ........... ENDOVASC ABDO REPR W/DEVICE ............. 23.00 .................... Agree ........... 23.00 23.00
34804# ..... ........... ENDOVASC ABDO REPR W/DEVICE ............. 23.00 .................... Agree ........... 23.00 23.00
34808# ..... ........... ENDOVASC ABDO OCCLUD DEVICE ............ 4.13 .................... Agree .......... 4.13 4.13
34812# ..... ........... XPOSE FOR ENDOPROSTH, AORTIC ........... 6.75 .................... Agree ........... 6.75 6.75
34813# ..... ........... XPOSE FOR ENDOPROSTH, FEMORL .......... 4.80 .................... Agree ........... 4.80 4.80
34820# ..... ........... XPOSE FOR ENDOPROSTH, ILIAC ................ 9.75 .................... Agree ........... 9.75 9.75
34825# ..... ........... ENDOVASC EXTEND PROSTH, INIT ............. 12.00 .................... Agree ........... 12.00 12.00
34826# ..... ........... ENDOVASC EXTEN PROSTH, ADDL ............. 4.13 .................... Agree ........... 4.13 4.13
34830# ..... ........... OPEN AORTIC TUBE PROSTH REPR ........... 32.59 .................... Agree ........... 32.59 32.59
34831# ..... ........... OPEN AORTOILIAC PROSTH REPR .............. 35.34 .................... Agree ........... 35.34 35.34
34832# ..... ........... OPEN AORTOFEMOR PROSTH REPR .......... 35.34 .................... Agree ........... 35.34 35.34
35600# ..... ........... HARVEST ARTERY FOR CABG ...................... 4.95 .................... Agree ........... 4.95 4.95
36540# ..... ........... COLLECT BLOOD VENOUS DEVICE ............. 0.00 .................... Agree ........... 0.00 0.00
36831 ....... ........... AV FISTULA EXCISION, OPEN ....................... 8.00 .................... Agree .......... 8.00 8.00
36832 ....... ........... AV FISTULA REVISION, OPEN ....................... 10.50 .................... Agree ........... 10.50 10.50
36870# ..... ........... AV FISTULA REVISION, OPEN ....................... 5.16 .................... Agree ........... 5.16 5.16
38500 ....... ........... BIOPSY/REMOVAL, LYMPH NODES .............. 2.88 .................... Agree ........... 2.88 2.88
38530 ....... ........... BIOPSY/REMOVAL, LYMPH NODES .............. 6.13 .................... Agree ........... 6.13 6.13
43231# ..... ........... ESOPH ENDOSCOPY W/US EXAM ................ 4.09 .................... Agree .......... 4.09 4.09
43232# ..... ........... ESOPH ENDOSCOPY W/US FN BX ............... 4.71 .................... Agree ........... 4.71 4.71
43240# ..... ........... ESOPH ENDOSCOPE W/DRAIN CYST .......... 7.39 .................... Agree .......... 7.39 7.39
43241 ....... ........... UPPER GI ENDOSCOPY WITH TUBE ............ 2.59 .................... Agree ........... 2.59 2.59
43242# ..... ........... UPPR GI ENDOSCOPY W/US FN BX ............. 5.51 .................... Agree ........... 5.51 5.51
43256# ..... ........... UPPR GI ENDOSCOPY W STENT .................. (a) .................... (a) ................ 4.35 4.35
43752# ..... ........... NASAL/OROGASTRIC W/STENT .................... (a) .................... (a) ................ 0.00 0.00
44132# ..... ........... ENTERECTOMY, CADAVER DONOR ............. carrier .................... Disagree ...... 0.00 0.00
44133# ..... ........... ENTERECTOMY, LIVE DONOR ...................... carrier .................... Disagree ...... 0.00 0.00
44135# ..... ........... INTESTINE TRANSPLNT, CADAVER .............. carrier .................... Disagree ...... 0.00 0.00
44136# ..... ........... INTESTINE TRANSPLANT, LIVE ..................... carrier .................... Disagree ...... 0.00 0.00
44370# ..... ........... SMALL BOWEL ENDOSCOPY/STENT ............ (a) .................... (a) ................ 4.33 4.33
44379# ..... ........... S BOWEL ENDOSCOPE W/STENT ................ (a) .................... (a) ................ 7.07 7.07
44383# ..... ........... ILEOSCOPY W/STENT .................................... (a) .................... (a) ................ 2.41 2.41
44397# ..... ........... COLONOSCOPY W STENT ............................. 4.78 .................... Disagree ...... 4.23 4.23
44500 ....... ........... INTRO, GASTROINTESTINAL TUBE .............. 0.49 .................... Agree ........... 0.49 0.49
45327# ..... ........... PROCTOSIGMOIDOSCOPY W/STENT ........... 2.66 .................... Disagree ...... 1.46 1.46
45341# ..... ........... SIGMOIDOSCOPY W/ULTRASOUND ............. 3.46 .................... Agree ........... 3.46 3.46
45342# ..... ........... SIGMOIDOSCOPY W/US GUIDE BX .............. 4.08 .................... Agree ........... 4.08 4.08
45345# ..... ........... SIGMODOSCOPY W/STENT ........................... 2.92 .................... Disagree ...... 2.66 2.66
45387# ..... ........... COLONOSCOPY W/STENT ............................. 5.66 .................... Disagree ...... 5.62 5.62
47379# ..... ........... LAPAROSCOPE PROCEDURE, LIVER ........... carrier .................... Agree ........... carrier carrier
50545# ..... ........... LAPARO RADICAL NEPHRECTOMY .............. 24.00 .................... Agree ........... 24.00 24.00
50546 ....... ........... LAPAROSCOPIC NEPHRECTOMY ................. 20.48 .................... Agree ........... 20.48 20.48
50548 ....... ........... LAPARO REMOVE K/URETER ........................ 24.40 .................... Agree ........... 24.40 24.40
50947# ..... ........... LAPARO NEW URETER/BLADDER ................ 24.50 .................... Agree ........... 24.50 24.50
50948# ..... ........... LAPARO NEW URETER/BLADDER ................ 22.50 .................... Agree ........... 22.50 22.50

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00047 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
65422 Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations

RUC rec- HCPAC rec-
CPT* HCFA HCFA work 2000 work
MOD Description ommenda- ommenda-
code decision RVU RVU
tion tion

50949# ..... ........... LAPAROSCOPE PROC, URETER ................... carrier .................... Agree ........... carrier carrier
52341# ..... ........... CYSTO W/URETER STRICTURE TX .............. 6.00 .................... Agree ........... 6.00 6.00
52342# ..... ........... CYSTO W/UP STRICTURE TX ........................ 6.50 .................... Agree .......... 6.50 6.50
52343# ..... ........... CYSTO W/RENAL STRICTURE TX ................. 7.20 .................... Agree .......... 7.20 7.20
52344# ..... ........... CYSTO/URETERO, STONE REMOVE ............ 7.70 .................... Agree .......... 7.70 7.70
52345# ..... ........... CYSTO/URETERO W/UP STRICTURE ........... 8.20 .................... Agree ........... 8.20 8.20
52346# ..... ........... CYSTOURETERO W/RENAL STRICT ............. 9.23 .................... Agree ........... 9.23 9.23
52351# ..... ........... CYSTOURETRO & OR PYELOSCOPE ........... 5.86 .................... Agree ........... 5.86 5.86
52352# ..... ........... CYSTOURETRO W/STONE REMOVE ............ 6.88 .................... Agree ........... 6.88 6.88
52353# ..... ........... CYSTOURETERO W/LITHOTRIPSY ............... 7.97 .................... Agree ........... 7.97 7.97
52354# ..... ........... CYSTOURETERO W/BIOPSY .......................... 7.34 .................... Agree ........... 7.34 7.34
52355# ..... ........... CYSTOURETERO W/EXCISE TUMOR ........... 8.82 .................... Agree ........... 8.82 8.82
52400# ..... ........... CYSTOURETERO W/CONGEN REPR ............ 9.68 .................... Agree ........... 9.68 9.68
54512# ..... ........... EXCISE LESION TESTIS ................................. 8.58 .................... Agree ........... 8.58 8.58
54522# ..... ........... ORCHIECTOMY, PARTIAL .............................. 9.50 .................... Agree ........... 9.50 9.50
55873# ..... ........... CRYOABLATE PROSTATE .............................. 17.80 .................... Agree ........... 17.80 17.80
57022# ..... ........... I &D VAGINAL HEMATOMA, OB ..................... 2.56 .................... Agree .......... 2.56 2.56
57023# ..... ........... I &D VAG HEMATOMA, TRAUMA ................... (a) .................... (a) ................ 2.56 2.56
57287# ..... ........... REVISE/REMOVE SLING REPAIR .................. 10.71 .................... Agree ........... 10.71 10.71
58353# ..... ........... ENDOMETR ABLATE, THERMAL .................... 3.56 .................... Agree ........... 3.56 3.56
61697# ..... ........... BRAIN ANEURYSM REPR, COMPLX ............. 50.52 .................... Agree ........... 50.52 50.52
61698# ..... ........... BRAIN ANEURYSM REPR, COMPLX ............. 48.41 .................... Agree ........... 48.41 48.41
61700 ....... ........... BRAIN ANEURYSM REPR , SIMPLE .............. 50.52 .................... Agree ........... 50.52 50.52
61702 ....... ........... INNER SKULL VESSEL SURGERY ................. 48.41 .................... Agree ........... 48.41 48.41
62252# ..... 26 CSF SHUNT REPROGRAM ............................. 0.74 .................... Agree ........... 0.74 0.74
63040 ....... ........... LAMINOTOMY, SINGLE CERVICAL ................ (a) .................... (a) ................ 18.81 18.81
63042 ....... ........... LAMINOTOMY, SINGLE LUMBAR ................... (a) .................... (a) ................ 17.47 17.47
63043# ..... ........... LAMINOTOMY, ADDL CERVICAL ................... (a) .................... (a) ................ 0.00 0.00
63044# ..... ........... LAMINOTOMY, ADDL LUMBAR ...................... (a) .................... (a) ................ 0.00 0.00
64612 ....... ........... DESTROY NERVE, FACE MUSCLE ................ 1.96 .................... Agree ........... 1.96 1.96
64613 ....... ........... DESTROY NERVE, SPINE MUSCLE .............. 1.96 .................... Agree ........... 1.96 1.96
64614# ..... ........... DESTROY NERVE, EXTREM MUSC ............... 2.20 .................... Agree ........... 2.20 2.20
66982# ..... ........... CATARACT SURGERY, COMPLEX ................ 13.50 .................... Agree ........... 13.50 13.50
66984 ....... ........... CATARACT SURG W/IOL, I STAGE ................ 10.23 .................... Agree .......... 10.23 10.23
67221# ..... ........... OCULAR PHOTODYNAMIC THER .................. (a) .................... (a) ................ 4.01 4.01
69714# ..... ........... IMPLANT TEMPLE BONE W/STIMUL ............. 14.00 .................... Agree ........... 14.00 14.00
69715# ..... ........... TEMPLE BNE IMPLNT W/STIMULAT .............. 18.25 .................... Agree ........... 18.25 18.25
69717# ..... ........... TEMPLE BONE IMPLANT REVISION .............. 14.98 .................... Agree ........... 14.98 14.98
69718# ..... ........... REVISE TEMPLE BONE IMPLANT .................. 18.50 .................... Agree ........... 18.50 18.50
70496# ..... ........... CT ANGIOGRAPHY, HEAD .............................. 1.75 .................... Agree ........... 1.75 1.75
70498# ..... ........... CT ANGIOGRAPHY, NECK .............................. 1.75 .................... Agree ........... 1.75 1.75
70540 ....... 26 MRI ORBIT/FACE/NECK W/O DYE ................. 1.48 .................... Disagree ...... 0.98 0.98
70542# ..... 26 MRI ORBIT/FACE/NECK W/DYE ..................... 1.78 .................... Disagree ...... 1.17 1.17
70543# ..... 26 MRI ORBT/FAC/NCK W/O&W DYE ................. 2.36 .................... Disagree ...... 1.56 1.56
70544# ..... 26 MR ANGIOGRAPHY HEAD W/O DYE ............. 1.20 .................... Agree ........... 1.20 1.20
70545# ..... 26 MR ANGIOGRAPHY HEAD W/DYE ................. 1.20 .................... Agree ........... 1.20 1.20
70546# ..... 26 MR ANGIOGRAPH HEAD W/O&W DYE ......... 1.80 .................... Agree ........... 1.80 1.80
70547# ..... 26 MR ANGIOGRAPHY NECK W/O DYE ............. 1.20 .................... Agree ........... 1.20 1.20
70548# ..... 26 MR ANGIOGRAPHY NECK W/DYE ................. 1.20 .................... Agree ........... 1.20 1.20
70549# ..... 26 MR ANGIOGRAPH NECK W/O&W DYE ......... 1.80 .................... Agree ........... 1.80 1.80
71275# ..... 26 CT ANGIOGRAPHY, CHEST ........................... (a) .................... (a) ................ 1.20 1.20
71550 ....... 26 MRI CHEST W/O DYE ...................................... (a) .................... (a) ................ 1.10 1.10
71551# ..... 26 MRI CHEST W/DYE .......................................... (a) .................... (a) ................ 1.30 1.30
71552# ..... 26 MRI CHEST W/O&W DYE ................................ (a) .................... (a) ................ 1.70 1.70
72191# ..... 26 CT ANGIOGRAPH PELV W/O&W DYE ........... (a) .................... (a) ................ 1.20 1.20
72195# ..... 26 MRI PELVIS W/O DYE ..................................... (a) .................... (a) ................ 1.10 1.10
72196 ....... 26 MRI PELVIS W/DYE ......................................... (a) .................... (a) ................ 1.30 1.30
72197# ..... 26 MRI PELVIS W/O & W DYE ............................. (a) .................... (a) ................ 1.70 1.70
73206# ..... 26 CT ANGIO UPR EXTRM W/O&W DYE ............ (a) .................... (a) ................ 1.20 1.20
73218# ..... 26 MRI UPPER EXTREMITY W/O DYE ................ (a) .................... (a) ................ 0.98 0.98
73219# ..... 26 MRI UPPER EXTREMITY W/DYE .................... (a) .................... (a) ................ 1.17 1.17
73220 ....... 26 MRI UPPR EXTREMITY W/O&W DYE ............ (a) .................... (a) ................ 1.56 1.56
73221 ....... 26 MRI JOINT UPR EXTREM W/O DYE .............. (a) .................... (a) ................ 0.98 0.98
73222# ..... 26 MRI JOINT UPR EXTREM W/ DYE ................. (a) .................... (a) ................ 1.17 1.17
73223# ..... 26 MRI JOINT UPR EXTR W/O&W DYE .............. (a) .................... (a) ................ 1.56 1.56
73706# ..... 26 CT ANGIO LWR EXTR W/O&W DYE .............. (a) .................... (a) ................ 1.20 1.20
73718# ..... 26 MRI LOWER EXTREMITY W/O DYE ............... (a) .................... (a) ................ 0.98 0.98
73719# ..... 26 MRI LOWER EXTREMITY W/DYE ................... (a) .................... (a) ................ 1.17 1.17
73720 ....... 26 MRI LWR EXTREMITY W/O&W DYE .............. (a) .................... (a) ................ 1.56 1.56

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00048 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations 65423

RUC rec- HCPAC rec-
CPT* HCFA HCFA work 2000 work
MOD Description ommenda- ommenda-
code decision RVU RVU
tion tion

73721 ....... 26 MRI JOINT OF LWR EXTRE W/O D ................ (a) .................... (a) ................ 0.98 0.98
73722# ..... 26 MRI JOINT OF LWR EXTR W/DYE ................. (a) .................... (a) ................ 1.17 1.17
73723# ..... 26 MRI JOINT LWR EXTR W/O&W DYE .............. (a) .................... (a) ................ 1.56 1.56
74175# ..... 26 CT ANGIO ABDOM W/O&W DYE .................... (a) .................... (a) ................ 1.20 1.20
74181 ....... 26 MRI ABDOMEN W/O DYE ................................ (a) .................... (a) ................ 1.10 1.10
74182# ..... 26 MRI ABDOMEN W/DYE .................................... (a) .................... (a) ................ 1.30 1.30
74183# ..... 26 MRI ABDOMEN W/O&W DYE .......................... (a) .................... (a) ................ 1.70 1.70
75635# ..... 26 CT ANGIO ABDOMINAL ARTERIES ............... (a) .................... (a) ................ 1.89 1.89
75952# ..... ........... ABDOM ANEURYSM ENDOVAS RPR ............ 4.00 .................... Agree ........... 4.00 4.00
75953# ..... ........... ABDOM ANEURYSM ENDOVAS RPR ............ 1.36 .................... Agree ........... 1.36 1.36
76012# ..... ........... PERCUT VERTEBROPLASTY FLUOR ............ 1.31 .................... Agree ........... 1.31 1.31
76013# ..... ........... PERCUT VERTEBROPLASTY, CT .................. 1.38 .................... Agree ........... 1.38 1.38
76393# ..... 26 MR GUIDANCE FOR NEEDLE PLACE ........... 1.50 .................... Agree ........... 1.50 1.50
76818 ....... 26 FETL BIOPHYS PROFIL W/STRESS .............. 1.05 .................... Disagree ...... 0.86 0.86
76819# ..... 26 FETL BIOPHYS PROFIL W/O STRS ............... 0.77 .................... Disagree ...... 0.63 0.63
76975 ....... 26 GI ENDOSCOPIC ULTRASOUND ................... 0.81 .................... Agree .......... 0.81 0.81
77520 ....... 26 PROTON TRMT, SIMPLE W/O COMP ............ carrier .................... Agree ........... carrier carrier
77522# ..... 26 PROTON TRMT, SIMPLE W/COMP ................ carrier .................... Agree ........... carrier carrier
77523 ....... 26 PROTON TRMT, INTERMEDIATE ................... carrier .................... Agree ........... carrier carrier
77525# ..... 26 PROTON TREATMENT, COMPLEX ................ carrier .................... Agree ........... carrier carrier
90940# ..... ........... HEMODIALYSIS ACCESS STUDY .................. 0.00 .................... Agree ........... 0.00 0.00
91132# ..... ........... ELECTROGASTROGRAPHY ........................... carrier .................... Agree ........... carrier carrier
91133# ..... ........... ELECTROGASTROGRAPHY W/TEST ............ carrier .................... Agree ........... carrier carrier
92585 ....... ........... AUDITOR EVOKE POTENT, COMPRE ........... 0.50 .................... Agree ........... 0.50 0.50
92586# ..... ........... AUDITOR EVOKE POTENT, LIMIT .................. 0.00 .................... Agree .......... 0.00 0.00
93662# ..... ........... INTRACARDIAC ECG (ICE) ............................. 2.80 .................... Agree ........... 2.80 2.80
93668# ..... ........... PERIPHERAL VASCULAR REHAB .................. 0.00 .................... Agree ........... 0.00 0.00
96570# ..... ........... PHOTODYNAMIC TX, 30 MIN ......................... 1.10 .................... Agree ........... 1.10 1.10
96571# ..... ........... PHOTODYNAMIC TX, ADDL 15 MIN ............... 0.55 .................... Agree ........... 0.55 0.55
97532# ..... ........... COGNITIVE SKILLS DEVELOPMENT ............. .................... 0.51 Disagree ...... 0.44 0.44
97533# ..... ........... SENSORY INTEGRATION ............................... .................... 0.48 Disagree ...... 0.44 0.44
97601# ..... ........... WOUND CARE SELECTIVE ............................ .................... (a) (a) ................ 0.50 0.50
97602# ..... ........... WOUND CARE NON-SELECTIVE ................... .................... (a) (a) ................ 0.00 0.00
97802# ..... ........... MEDICAL NUTRITION, INDIV, IN .................... .................... 0.45 Disagree ...... 0.00 0.00
97803# ..... ........... MED NUTRITION, INDIV, SUBSEQ ................. .................... 0.37 Disagree ...... 0.00 0.00
97804# ..... ........... MEDICAL NUTRITION, GROUP ...................... .................... 0.25 Diagree ....... 0.00 0.00
99172# ..... ........... OCULAR FUNCTION SCREEN ........................ 0.00 .................... Agree ........... 0.00 0.00
a No RUC recommendation provided.
# New Codes.
* All numeric HCPCS CPT Copyright 2000 American Medical Association.

Discussion of Codes for Which There 15343 be crosswalked from deleted Additionally, we note that some
Were No RUC Recommendations or for HCPCS codes G0170 and G0171, which commenters requested the global period
Which the RUC Recommendations Were are currently being used to report for HCPCS code G0170 be lowered from
Not Accepted bioengineered tissue grafts. The work ten to seven days. This was not done,
RVUs for CPT codes 15342 and 15343 because we use only three global period
The following is a summary of our
rationale for not accepting particular are crosswalked from G0170 and G0171, lengths zero, ten, and ninety days.
RUC work RVU recommendations. It is with the following modification. Clearly the ten-day global period is the
arranged by type of service in CPT Currently, HCPCS code G0170 includes most appropriate and consistent with
order. Additionally, we also discuss the work of CPT codes 15000 and the recommendation of the commenters.
those CPT codes for which we received 15350. The CPT instructions for CPT This decision will be applied to CPT
no RUC recommendations for physician code 15342 state that it can be billed code 15342. CPT code 15343 is an add-
work RVUs. This summary refers only with CPT code 15000. For this reason on service that does not have a global
to work RVUs. the crosswalk for CPT code 15342 period.
would be to 25 percent of the work RVU Percutaneous Vertebroplasty (CPT Code
Bioengineered Tissue Grafts (CPT Codes of CPT code 15350, or 1.00 work RVUs.
15342 and 15343) 22522)
This percentage was chosen because
Temporary HCPCS Codes G0170 and CPT code 15342 is for graft sizes of up The RUC recommended a work RVU
G0171, established in the November to 25 square centimeters, and CPT code of 4.31 for CPT code 22522. The RUC
1999 final rule, will be deleted. The two 15350 is for graft sizes up to 100 square arrived at this value based upon the fact
aforementioned deleted codes have been centimeters. Similarly, the RUC that the work involved with CPT code
replaced by CPT codes 15342 and recommended work RVUs for CPT code 22522 was 50 percent of the total work
15343. The RUC recommended that the 15343 are adjusted to 25 percent of of CPT codes 22520 and 22521. The
work RVUs for CPT codes 15342 and 15351, or 0.25 work RVUs. RUC failed to remove the pre-service

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00049 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2
65424 Federal Register / Vol. 65, No. 212 / Wednesday, November 1, 2000 / Rules and Regulations

99213 and the post-service 99238 Laminotomy Re-Exploration (CPT Codes the work RVUs recommended by the
associated with CPT codes 22520 and 63040, 63042, 63043, and 63044) RUC were more comparable to the work
22521 before performing their The RUC did not supply work RVU RVUs associated with CPT code 75671,
calculations. CPT code 22522 is an add- recommendations for CPT codes 63040 Angiography, carotid, cerebral, bilateral,
on procedure, and there should be no through 63044. CPT codes 63040 and radiological interpretation and
pre-and post-service work associated supervision, and CPT code 75680,
63042 were revised to account for single
with this service. We have removed the Angiography, carotid, cervical, bilateral,
interspace cervical and lumbar
work RVUs of 99213 (pre-service) and radiological interpretation and
laminotomy, respectively. CPT codes
99238 (post-service) from the weighted supervision. Both CPT code 75671 and
63043 and 63044 were added to account
average of CPT codes 22520 and 22521. CPT code 75680 have work RVUs of
for each additional cervical and lumbar
1.66. The proportional work RVU
For this reason, we have assigned a interspace laminotomy(s). We will
increase from the angiography
work RVU of 3.00 to CPT code 22522. bundle CPT code 63043 into CPT code
supervision and interpretation code to
63040 and CPT code 63044 into CPT
Naso- or Oro-gastric Tube Placement the CT angiography code was 1.05.
code 63042, and retain the existing work
(CPT Code 43752) Therefore, in determining the work
RVUs for CPT codes 63040 and 63042. RVUs of the other CT angiography
The RUC did not supply us with a We will re-evaluate these services when codes, we—(1) compared each code to
recommendation for CPT code 43752. the RUC supplies work RVU its most comparable angiographic
recommendations. radiological supervision and
We believe that this service is bundled
into evaluation and management Ocular Photodynamic Therapy (CPT interpretation code, and (2) applied a
services. For this reason, there is no Code 67221) proportionate work increase of 1.05 to
work RVU associated with this service. the CT angiography code. The CPT
The RUC did not supply work RVU
codes to which we compared the CT
Small Bowel Implantation (CPT Codes recommendations for CPT code 67221.
angiography codes were 75605, 75736,
44132, 44133, 44135, and 44136) Subsequent to the publication of the
75710, 75625, and 75630. Note that CT
July 2000 proposed rule in which we angiography of the extremities has been
The RUC recommended carrier proposed establishing a new HCPCS valued as a unilateral service. However,
pricing for these services. These services code for this service, the CPT editorial CPT code 75635 is valued for bilateral
are not covered transplant services panel approved CPT code 67221 for lower extremity run.
under Medicare. For this reason, there ocular photodynamic therapy. We have
are no work RVUs associated with these deleted our proposed temporary code Magnetic Resonance Imaging
services. and established values for CPT code Procedures (CPT Codes 70540, 70542,
67221. Based on comments received 70543, 71550, 71551, 71552, 72195,
Endoscopic Enteral Stenting (CPT Codes from specialty societies and a 72196, 72197, 73218, 73219, 73220,
43256, 44370, 44379, 44383, 44397, comparison of the work values for this 73221, 73222, 73223, 73718, 73719,
45327, 45345, 45387) procedure with CPT code 67210, 73720, 73721, 73722, 73723, 74181,
Destruction of localized lesion of retina, 74182, and 74183)
The RUC determined a work we have assigned 4.01 work RVUs to CPT 2000 has a single code to
increment, from the applicable this service. The intraservice times and describe MRI of each region of the body
endoscopic base code, for work intensities for CPT codes 67210 except for MRI of the brain, where three
transendoscopic stent placement and 67221 are comparable. Therefore, separate codes exist that describe MRI of
including predilation of 1.96 RVUs. We adjusting for the work value of the the brain without contrast, with
agree with this increment. For the postoperative visits (because 67210 has contrast, and without contrast followed
endoscopic stent placement CPT codes a 90-day global period) and the 20 by contrast. For CPT 2001 the single
for which we did not receive a work percent retreatment rate included in MRI code for each area of the body will
recommendation from the RUC, we CPT code 67210, and then applying the be broken out into three separate CPT
applied this increment to the applicable intraservice work intensity of 67210 to codes describing MRI for that body area
endoscopic basecode. Because 67221, yields an appropriate work value without contrast, with contrast, and
endoscopic stent placement is being for 67221. For a further discussion of without contrast followed by contrast.
currently billed under existing this issue, see section II.G. The only codes for which we received
endoscopic CPT codes, we needed to work RVU recommendations from the
Computed Tomographic Angiography RUC were CPT 70540 (MRI orbit/face/
make a work neutrality adjustment to (CPT Codes 71275, 72191, 73206, 73706,
each family of codes in which a stent neck, w/o contrast), 70542 (MRI orbit/
74175, and 75635) face/neck, w/contrast), and 70543 (MRI
placement code had been created.
CPT created a series of new codes for orbit/face/neck, w/out then w/contrast).
Incision and Drainage of Vaginal 2001 describing computed tomographic The recommended work RVUs were
Hematoma (CPT Code 57023) (CT) angiography for different parts of 1.48, 1.78, and 2.36 respectively. The
the body. The RUC submitted work services that will be described under
The RUC did not supply a work RVU recommendations of 1.75 RVUs for CPT these three CPT codes are currently
recommendation for CPT code 57023. codes 70496 and 70498, with which we being coded under a single CPT code,
We did receive a work RVU agree. The RUC did not submit work 70540 (current descriptor is Magnetic
recommendation for similar CPT code recommendations for the other CT Resonance (e.g. proton) imaging, orbit,
57022. Until such time as we receive angiography codes. The RUC compared face, and neck with a current work RVU
more information allowing us to the head and neck CPT angiography of 1.48). For this reason we must make
appropriately value CPT code 57023, we codes to MRI angiography and CT scans the new CPT codes work neutral to the
will adopt the RUC recommended work without contrast followed by contrast of current CPT code; that is, the total work
RVU for CPT code 57022. For these the same region in determining the RVUs associated with the three new
reasons, we have assigned a work RVU values for these services. However, codes must result in the same total work
of 2.56 to CPT code 57023. upon our review, we determined that RVUs of the current CPT code. The RUC

VerDate 11<MAY>2000 18:19 Oct 31, 2000 Jkt 194001 PO 00000 Frm 00050 Fmt 4701 Sfmt 4700 E:\FR\FM\01NOR2.SGM pfrm11 PsN: 01NOR2