What is the Academy doing about burdensome private payer policies?

By Lou Terranova, Associate Director, Practice Advocacy, December 1, 2023

DermWorld interviews Mollie MacCormack, MD, FAAD, chair of the AADA’s Patient Access and Payer Relations Committee, about payer issues the Academy is currently addressing.

Dr. MacCormack: The American Academy of Dermatology Association (AADA) payer advocacy arm strives to alleviate administrative burdens for dermatologists, maintains appropriate reimbursement for furnished services, and ensures patients can access quality care. The AADA advocates on behalf of dermatologists for reimbursement that appropriately reflects both the costs of clinical services, and the administrative requirements physicians have in the current health care environment. As advocates, we build relationships with payers and analyze insurer coverage and payment trends affecting dermatology. This critical collaboration addresses immediate needs affecting our members’ ability to deliver care. 

Additionally, the AADA has scheduled quarterly calls with the largest health plan carriers including Aetna, Elevance Health (formerly Anthem), and UnitedHealthcare, and biannual calls with Cigna. These regular contacts facilitate dialogue to address priority dermatology payment issues. Additionally, the AADA works with state dermatology societies as needed to address local and regional payer issues.

DermWorld: Why is payer advocacy needed?

Dr. MacCormack: Dermatologists face increasing administrative complexity even as payers try to contain compensation, creating challenges to a viable dermatology practice. That’s why the Academy advocates constantly for appropriate reimbursements by payers, and to advance the payment models of the future. In addition to appropriate payment, the Academy supports industry-wide administrative simplification, with the objectives of reducing health care costs and removing unnecessary burdens throughout the claims and billing processes. While we cannot negotiate fees or contract terms on behalf of members, the Academy is determined to help dermatologists be appropriately paid and lower administrative roadblocks by identifying and mitigating payer regulations and processes that add cost and undermine the efficient delivery of high-quality care.

DermWorld: What are the top payer issues being addressed?

Dr. MacCormack: The biggest issues we are currently working on are modifier 25 payment reductions, evaluation and management (E/M) code adjustments, and prior authorizations.

DermWorld: What exactly is modifier 25 and how does that affect the average dermatology practice?

Dr. MacCormack: Per CPT guidelines, physicians are to use modifier 25 to indicate that a patient’s condition required a significant, separately identifiable E/M service above and beyond that associated with another procedure or service being reported by the same physician on the same date.

Multiple payers are reviewing the use of modifier 25 and some have implemented or considered policies that automatically reduce reimbursement through broad policies, targeted denials of high utilizers, post payment audits, and recoupment.

The Academy opposes all reimbursement policies implemented by insurance companies that reduce payment when modifier 25 is appropriately documented and reported. Some examples of our current advocacy include:

• Cigna delayed the implementation of a burdensome policy requiring dermatologists to submit documentation when reporting modifier 25 when billed with E/M CPT® codes 99212 – 99215 and a minor procedure. The policy would have gone into effect first in 2022 and then in 2023, but now Cigna has delayed implementation indefinitely, because of the AADA’s advocacy efforts. We have offered to work with Cigna on educational efforts regarding appropriate use of modifier 25.

• We are currently addressing concerns about reported increases in denials with both Aetna and UnitedHealthcare that seem to be associated with a misunderstanding of what work is included within the minor surgery global package by both of these carriers.

DermWorld: What about E/M code leveling?

Dr. MacCormack: Some payers are reviewing claims from physicians who are identified as coding at a higher E/M level as compared to their specialty peers by using proprietary algorithms that may incorrectly link specific diagnoses to certain levels of E/M, triggering claim edits within their claim processing systems. The Academy opposes reimbursement policies implemented by payers that reduce the E/M level or downcode payment when the E/M code is appropriately documented and reported.

DermWorld: What is the Academy doing about burdensome prior authorization protocols?

Dr. MacCormack: Poorly designed prior authorization protocols interfere with patient care and create unwanted burdens on dermatology practices. The AADA advocates that the process in which prior authorization determinations are made should be standardized and the speed of determination should be quantified and minimized. Undue delays can cause irreparable harm to patients in need of specific treatments. We have worked with our federal and state advocacy staff through comment letters resulting in CMS clarifying its prior authorization requirements for Medicare Advantage plans and the Part D Medicare Prescription Drug Benefit, easing the administrative burden on dermatologists and other physicians. Successful advocacy efforts include: 

• UnitedHealthcare agreed to amend its policies on prior authorization for Mohs surgery and adjacent tissue transfer. Prior authorization is no longer required when the code sets are billed together. 

• UnitedHealthcare adjusted its multiple procedure payment reduction policy after we argued that the insurer’s policy does not fully align with that of CMS. Under Medicare, the payment reduction does not apply if surgeons of different specialties are each performing a different procedure (with specific CPT codes). Because of AADA advocacy, UnitedHealthcare will now follow Medicare policy and will pay both the dermatologist and another specialty physician performing a different procedure.

DermWorld: What can members do to help?

Dr. MacCormack: Advocacy does not exist in a vacuum and works best at all levels — nationally and at the state/local level and at the grassroots level with individual members. As we work with the national carriers and collaborate with the state dermatology societies on local payer issues, members can best serve themselves as advocates as well. The Academy has numerous resources on coding, documentation, prior authorization, and fee schedule negotiation to keep members up to date on current guidance. To help us identify and prioritize payer issues, members can report their payer issue to privatepayer@aad.org. This is helpful in making the Patient Access and Payer Relations Committee and payer advocacy staff aware of payment issues with a particular payer.

Mollie MacCormack, MD, FAAD, is the chair of the AADA’s Patient Access and Payer Relations Committee.

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