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

NVAC VACCINE ADMINISTRATION: BETWEEN THE RUC and A HARD PLACE

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

HOW WE GET PAID ( KEY TO SOLVING REIMBURSEMENT PROBLEMS)

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

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

The CPT Process: The genesis of a code

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

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

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

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

The RUC Process Genesis of Relative Value for Physicians

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

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

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

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

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

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

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

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

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

REIMBURSEMENT PROBLEMS AND SOLUTIONS ARE FOUND AT EACH LEVEL!

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

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

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

RBRVS by PAYER % WHO USE

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)

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.

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

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

RBRVS AND PEDIATRICIANS MAJOR COMPONENTS

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

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

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

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

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

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

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

CONVERSION FACTOR $ $ $ Nov. Fed. Register- $36.19  %5.4 CMS changes conversion factor annually to maintain budget neutrality

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

RBRVS-Relative Value-RVU Your pay = RVU x CF =$ At “100%” of Medicare RBRVS –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)

CONVERSION FACTOR $ BY PAYER

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)

Vaccine Administration Codes and the

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

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!

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

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

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

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

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

Vaccines/Toxoids – – 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)

Immunization Administration Example 6 month infant-preventive visit- receives 4 immunizations- –DTaP –IPV –PCV –HIB –HepB (VFC-Enter charge of $0 for CPT product codes, usual charge for administration codes)

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

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

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

CMS-RBRVS MEDICARE FEE SCHEDULE FEDERAL REGISTER- DEC 31, 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

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

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

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)

Immunization Administration Example-Combination Vaccine 4 month infant-preventive visit- now receives same components in 3 immunizations- –DTaP-HepB-IPV –PCV –HIB

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

“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.