Evaluation and Management (E/M) coding changes are coming in 2021 – Part 1

Several major E/M guideline revisions will go into effect Jan. 1, 2021, including:

• E/M guideline additions, revisions, and restructuring;

• Deletion of CPT code 99201 and revision of CPT codes 99202 – 99215

• Updates to components for code selection to include:

  • A medically appropriate history and/or physical examination (though required, it is not to be used as part of the code level selection);

  • Medical decision making (MDM); OR
    Total time on the date of the encounter.

This article, the first in a series, explains how these changes came to be, how to AADA advocated to prevent changes that would have had a worse impact on dermatology, and how dermatologists can begin preparing for the changes.

How these changes came to be

In July 2019, CMS released the Medicare Physician Fee Schedule Proposed Rule which stated that the current E/M coding and documentation requirements were outdated and needed updating.

CMS proposed to make several significant changes to the way office E/M services would be reimbursed, to take effect in 2021. CMS proposed that:

1. There would be one fee for levels 2 through 5 for a new patient and levels 2 to 5 for an established patient;

2. New add-on G codes would be used that were intended to increase payment for care of complex patients; and

3. Payment for the E/M service or the procedure would be reduced by 50% when the E/M is reported with a modifier 25.

This last part of the proposal from 2019, cutting payments when modifier 25 is appropriately included with an E/M service, would have resulted in a reduction in office E/M payments for dermatologists of about 25%, or about 7% of total dermatology payments.

AADA advocacy

The AADA engaged in advocacy targeting CMS, HHS, and members of Congress, both alone and as part of coalitions and the overall house of medicine. As a result of the advocacy, CMS agreed to drop its proposal and instead consider a revision of the E/M codes with values developed by the house of medicine. That work was undertaken by the AMA CPT/RUC E/M Workgroup, comprised of representatives of all specialties including the AADA. A key deliberation of the Workgroup centered around whether the new code descriptor language should direct physicians to select the code level based solely on time. Ultimately, the dermatologists involved successfully persuaded the Workgroup to broaden the language to allow for a choice of time or medical decision making. The AADA also participated in the development of values for the newly revised codes through the RVU Update Committee (RUC). The unanimous agreement of all medical specialties to support the new E/M code descriptions and associated RUC recommended values resulted in CMS choosing to accept them in lieu of its original proposal.

Summary of major E/M revisions for 2021

E/M levels of service will be based on either the medical decision making (MDM) OR total time spent with the patient on the date of the encounter.

Even though documentation of medically appropriate history and physical examination will still be required, the amount of history or number of elements examined and documented will not factor into the determination of the overall E/M level of service choice. To this end, the AMA has changed the definition of the time element associated with codes 99202-99215 from typical face-to-face time to total time spent on the day of the encounter, and the amount of time associated with each code. Total time includes non-face-to-face services and reflects clear time ranges for each code. The next article in this series will provide more guidance on selecting E/M codes based on time.

Overview of major E/M revisions for 2021



Note: The 2021 E/M changes only apply to the office and other outpatient services (99202 – 99215). There are no changes to Hospital Observation, Hospital Inpatient, Consultation, Emergency Department, Nursing Facility, Domiciliary, Rest Home or Custodial Care, and Home care services. E/M services provided by dermatologists in these settings must continue to be reported using the E/M key components (history, physical examination, and MDM).

The revised E/M code changes will go into effect on Jan. 1, 2021. Coding for E/M services will be very different from the way dermatologists currently code. These changes will require a completely different approach to determining the E/M level of service.

The AADA will continue to release intermittent Derm Coding Consult articles and other resources to help derm practices implement the operational, infrastructure, and workflow changes that will allow a seamless transition to the new reporting guidelines. You and your staff can prepare with the AADA’s resources this year.

Part 2 of this article will introduce the changes to the E/M code descriptors, components, and time required for each code selection in 2021 and beyond.