1. National Vaccine Advisory Committee Joel F. Bradley. MD, FAAP Washington, D.C. June 4, 2003

2. NVAC VACCINE ADMINISTRATION: BETWEEN THE RUC and A HARD PLACE

4. THE PLAN 1.HOW PHYSICIANS ARE PAID- CPT AND THE RUC 2.THE RBRVS 3.VACCINE CODING AND REIMBURSEMENT

5. HOW WE GET PAID ( KEY TO SOLVING REIMBURSEMENT PROBLEMS)

6. SERVICE  CODE  VALUE  RBRVS  FEE SCHEDULE  CONTRACT  $

7. 1. THE CODE First…DEFINE THE SERVICE Then…GET A CODE! (AMA CPT)

8. The CPT Process: The genesis of a code

9. CPT: CURRENT PROCEDURAL TERMINOLOGY BEGAN IN 1966 8,000 CODES; OFFICIAL PROCEDURAL CODE SET FOR HIPAA OWNED BY AMA -- BIG BUSINESS REVISED ANNUALLY IN THE FALL

10. CPT: THE EDITORIAL PANEL 16 VOTING MEMBERS –11 PHYSICIANS NOMINATED BY AMA BOARD OF TRUSTEES PLUS: –1 HCPAC REPRESENTATIVE –CMS, BCBSA, AHA AND HIAA REPRESENTATIVES NOMINATED BY SPECIALITY SOCIETIES OF THE 11 AMA-APPOINTED SEATS, FOUR ARE 4-YEAR TERMS AND SEVEN ARE 8- YEAR TERMS

11. CPT: THE EDITORIAL PANEL CPT ADVISORY COMMITTEE –100 SPECIALTY SOCIETIES –EACH HAS ONE ADVISOR –ADVISOR PRESENTS CODE PROPOSAL –ADVISOR COMMENTS ON ALL CODES

12. 2. THE VALUE SECOND…GET A VALUE AMA/SPECIALTY SOCIETY RELATIVE VALUE SCALE UPDATE COMMITTEE (RUC)

13. The RUC Process Genesis of Relative Value for Physicians

14. RUC: THE RBRVS UPDATE COMMITTEE 29 MEMBERS –23 SEATS ASSIGNED TO SPECIALTIES –ALSO AMA, AOA, HCPAC, PEAC, CPT EDITORIAL PANEL NOMINATED BY SPECIALITY SOCIETIES APPOINTED BY AMA BOARD NO TERMS

15. RUC: THE RBRVS UPDATE COMMITTEE CMS ATTENDS/COMMENTS RUC ADVISORY COMMITTEE –ADVISORS PRESENT SOCIETY RVU RECOMMENDATIONS ON WORK AND PE –PRESENTATION DATA BASED ON MEMBER SURVEYS AND EXPERT PANELS

16. RUC: THE RBRVS UPDATE COMMITTEE RUC VOTES ON RELATIVE VALUE RECOMMENDATIONS TO CMS –Physician work RVU –Direct practice expense inputs (CMS calculates PE RVU)

17. CPT VS. RUC CPTRUC AAP SEAT (VOTE) (-) + AAP ADVISOR + + OPEN MEETING +/- + ARBITRATION - (appeal) + CMS + +

18. 3. THE FEE SCHEDULE (RBRVS) NEXT…CMS AGREES (90%!), OR… CAN  OR  PUBLISHES THE VALUE (FEDERAL REGISTER); MEDICARE FEE SCHEDULE OR RBRVS

19. CMS OPTIONS: PAYMENT POLICY PUBLISHES RUC RECOMMENDED VALUE AMENDED VALUE-OMIT WORK MAKE NON-ACTIVE (not paid) DOES NOT PUBLISH VALUES –OTHER PAYERS ASSIGN OWN VALUES –OFTEN NOT PAID

20. 4. THE PAYERS THEN…PAYERS ADOPT RBRVS AS THEIR PHYSICIAN FEE SCHEDULE PAYERS SELECT MANY CODES/VALUES - - OMIT OTHERS! PAYMENT POLICY -- LMRP

21. 5. THE PATIENTS EMPLOYER PURCHASES PLAN = PACKAGE of COVERED BENEFITS

22. 6. PHYSICIAN REIMBURSED PROVIDER - PAYER CONTRACT PROVIDER PERFORMS THE SERVICE SUBMITS a CLEAN CLAIM (CPT CODE) PAYER PAYS THE CLAIM per CONTRACTED FEE SCHEDULE

23. REIMBURSEMENT PROBLEMS AND SOLUTIONS ARE FOUND AT EACH LEVEL!

24. RBRVS AND PEDIATRICIANS R esource B ased R elative V alue S cale

25. RBRVS AND PEDIATRICIANS RELEVANCE TO PRACTICE –IT IS THE BASIS OF HOW WE GET PAID!

26. RBRVS Resource Based Relative Value Scale Fee Schedule of CMS-Medicare Used by most ALL Payers Most CPT codes have a “Relative Value”

27. RBRVS by PAYER % WHO USE

28. RBRVS AND PEDIATRICIANS RBRVS –Began January 1, 1992 (CPT E/M codes) –Authorized by Congress 1989: OBRA ’89 –Revised the Medicare Fee Schedule (1965) A CPR system (customary, prevaling,reasonable) Maintains budget neutrality ($20 million)

29. RBRVS AND PEDIATRICIANS CONCEPT- Services are ranked relative to the costs of the resources used to perform them. –If service A is twice as hard,takes twice as long, used twice the overhead expense of service B, then A will have twice the value of B.

30. RBRVS: MAJOR COMPONENTS 1.PHYSICIAN WORK 2.PRACTICE EXPENSE 3.PROFESSIONAL LIABILTY INSURANCE (PLI) (MALPRACTICE) EXPENSE

31. RBRVS-Relative Value-RVU RVU = value of a service relative to another –Total RVU= work RVU + practice expense RVU + PLI RVU –99213 –reference = 1.39 RVU

32. RBRVS AND PEDIATRICIANS MAJOR COMPONENTS

33. PHYSICIAN WORK PHYSICAN TIME TECHNICAL SKILL/PHYSICAL EFFORT MENTAL EFFORT/JUDGEMENT STRESS-IATROGENIC RISK

34. PHYSICIAN WORK SERVICE PERIODS –PRE-SERVICE (PREPARATION) –INTRA-SERVICE (PATIENT ENCOUNTER TIME) –POST-SERVICE (CHARTING, PHONE CALLS ABOUT THE PROBLEM)

35. PRACTICE EXPENSE 1. DIRECT COSTS CLINICAL LABOR,MEDICAL SUPPLIES, AND MEDICAL EQUIPMENT 2. INDIRECT COSTS ADMINISTRATIVE LABOR,OFFICE EXPENSE, AND OTHER COSTS

36. PRACTICE EXPENSE SITE OF SERVICE “ADJUSTMENTS” (CMS ADJUSTS PE DOWNWARD IF DONE IN A FACILITY-AVOIDS DOUBLE PAYMENTS) FACILITY=HOSPITAL,ASC,SNF NON-FACILITY= PRIVATE OFFICE

37. PLI- PROFESSIONAL LIABILITY INSURANCE –1-3% of the total RVU –ORIGINALLY CHARGE BASED –RESOURCE BASED SINCE 2000 –BASED ON SPECIALTY SPECIFIC PREMIUM DATA, RISK, AND UTILIZATION

38. RBRVS-Relative Value-RVU TOTAL RVU= Work RVU + Practice Expense (PE) RVU + Professional Liability Insurance (PLI) RVU –99213 reference = 0.67 RVU (work) + 0.69 (PE) + 0.03 RVU (PLI) = 1.39 total RVU (For 2003)

39. So…can you take an RVU to the bank? Pay $ = Total RVU (in units) x Conversion Factor (CF) in $/RVU

40. CONVERSION FACTOR 1999 - $34.73 2000 - $36.61 2001 - $38.25 2002 - Nov. Fed. Register- $36.19  %5.4 CMS changes conversion factor annually to maintain budget neutrality

41. CONVERSION FACTOR 2003 2003 Proposed = $34.59  4.4% Federal Register – Dec. 02-2003 Final Rule FEB. LEGISLATIVE “FIX”-  $36.78  1.5% This only has to apply to Medicare!

42. RBRVS-Relative Value-RVU Your pay = RVU x CF =$ At “100%” of Medicare RBRVS 99213 –1.32 RVU x $38.25 = $50.50 (2001) –1.39 RVU x $36.19 = $50.32 (2002) –1.39 RVU x $36.78 = $51.12 (2003)

43. CONVERSION FACTOR $ BY PAYER

44. OTHER MEDICARE “ADJUSTMENTS” GPCI –GEOGRAPHIC PRACTICE COST INDEX –ACCOUNTS FOR GEOGRAPHIC DIFFERENCE IN COST OF RESOURCES –1.0 = AVERAGE –DIFFER BY AREA (STATE) AND TYPE OF RESOURCE (WORK, PE, PLI)

45. Vaccine Administration Codes and the

46. THE PROBLEMS CMS (other payers) has not valued physician work of counseling (o rvu) in vaccine administration Combination vaccines present a unique reimbursement issue regarding physician counseling

47. THE SIZE of the PROBLEM Four million births a year Each child receives over 20 vaccines The majority of vaccines are administered in the private sector BIG!

48. THE AAP VISION Have all payers value physician work of face to face counseling about vaccines Remove any financial barriers inherent in current coding system to using combination vaccines

49. THE BEST SOLUTIONS Create or revise codes so that work is recognized Work with CMS and all payers to obtain reimbursement for the “new” codes

50. THE SERVICE-CODES GIVING VACCINES- PHYSICIANS REPORT (BILL): 1. CPT Code for the Product and always 2. CPT code for Vaccine administration

51. Immunization Administration 2000 90471 Immunization administration, one vaccine, single or combination (includes percutaneous, intradermal, subcutaneous, intramuscular and jet injections ) 90472 Each additional vaccine

52. Immunization Administration Vaccines-new for 2002 90473 Immunization administration, one vaccine -intranasal or oral (single or combination) 90474 Each additional vaccine * CMS CONSIDERS THESE “SELF- ADMINISTERED”-NO RVU’S

53. Vaccines/Toxoids 90476 – 90749 – Identify the specific vaccine product only – Use in addition to administration codes – Use even if vaccine supplied for free ( data used by payers/CDC to monitor immunization practice)

54. Immunization Administration Example 6 month infant-preventive visit- receives 4 immunizations- –DTaP- 90700 + 90471 –IPV - 90713 + 90742 –PCV7- 90669 + 90472 –HIB - 90648 + 90472 –HepB- 90744 + 90472 (VFC-Enter charge of $0 for CPT product codes, usual charge for administration codes)

55. THE VALUE-AMA RUC 1999 RUC 90471/90472 RECOMMENDS PHYSICIAN WORK VALUE- –90471- 0.17 rvu –90472-0.15 rvu FORWARDS TO CMS (who adds pe/pli values)

56. CMS-RBRVS MEDICARE FEE SCHEDULE 2000 - No values published. Uses “G” code 2001 – No values published 2002- Value published total rvu 0.11=$3.98 omitted physician work component same value as simple injection

57. CMS-RBRVS MEDICARE FEE SCHEDULE 2003 - CMS REVISES VALUE –PE value based on resources used –Values increase –90471 – rvu 0.21 -$3.98 to $7.75 –90472 – rvu 0.15 -$3.98 to $5.25 STILL NO WORK VALUE

58. CMS-RBRVS MEDICARE FEE SCHEDULE FEDERAL REGISTER- DEC 31, 2002 - CMS would consider adding physician work to pediatric vaccine administration if codes reflect pediatric services - In general- won’t publish work in the existing codes- not typical of Medicare vaccines admin., may code in other ways

59. Vaccine Administration 2003 AAP Works with AMA and CMS AAP DEVELOPS A CODE PROPOSAL FOR PEDIATRIC-SPECIFIC VACCINE ADMINISTRATION IF CPT EDITORIAL PANEL APPROVES, CMS could ADD WORK VALUE FOR 2004/2005

60. CURRENTLY…. FEB. 2003 – CPT REJECTS INTIAL AAP PROPOSAL FOR 4 PEDIATRIC CODES MAY 2003- PANEL and AAP AGREE TO DEVELOP A SINGLE CODE FOR PEDIATRIC VACCINE COUNSELING (AAP will present in August 2003)

61. COMBINATION VACCINES THE PARADOX: AS NUMBER OF COMPONENTS in 1 vaccine INCREASES: -physician work per shot increases -practice administrative costs decrease (nurse time, syringes charting)

62. Immunization Administration Example-Combination Vaccine 4 month infant-preventive visit- now receives same components in 3 immunizations- –DTaP-HepB-IPV- 90723 + 90471 –PCV7- 90669 + 90472 –HIB - 90648 + 90472

63. Immunization Administration- Combination Vaccine Financial Impact on Practice 1.Loss of income from 2 vaccine administration services (90472) = $5.52 x 2= $11.04 per visit 2. Physician time to counsel is the same

64. “New” New Code Proposal- Single Code for Counseling 1.Is reported once per visit when vaccine administration and physician counseling are documented (regardless of the number of separate vaccines given) 2.Recognizes physician work-valued based on existing components. 3.Can be “revalued” through the RUC as new components are licensed.