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Peter K. Smith
John E. Mayer, Jr
Kirk R. Kanter
Verdi J. DiSesa
James M. Levett
Cameron D. Wright
Francis C. Nichols, III
Keith S. Naunheim
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Ann Thorac Surg 2007;83:12-20
© 2007 The Society of Thoracic Surgeons


Report of the STS/AATS Workforce on Nomenclature and Coding

Physician Payment for 2007: A Description of the Process by Which Major Changes in Valuation of Cardiothoracic Surgical Procedures Occurred

Peter K. Smith, MDa,*, John E. Mayer, Jr, MDb, Kirk R. Kanter, MDc, Verdi J. DiSesa, MDd, James M. Levett, MDe, Cameron D. Wright, MDf, Francis C. Nichols, III, MDg, Keith S. Naunheim, MDh, STS/AATS Workforce on Nomenclature and Coding

a Division of Thoracic Surgery, Department of Surgery, Duke University, Durham, North Carolina
b Department of Cardiovascular Surgery, Boston Children’s Hospital, Harvard Medical School, Boston, Massachusetts
c Division of Cardiothoracic Surgery, Emory University School of Medicine, Atlanta, Georgia
d Section of Cardiac Surgery, The Chester County Hospital, West Chester, Pennsylvania
e Physician’s Clinic of Iowa, Cedar Rapids, Iowa
f Thoracic Surgery, Massachusetts General Hospital, Harvard Medical School, Boston, Massachusetts
g Division of General Thoracic Surgery, Mayo Clinic and Mayo Foundation, Rochester, Minnesota
h Department of Surgery, St. Louis University Health Sciences Center, St. Louis, Missouri


Abbreviations and Acronyms CMS = Centers for Medicare & Medicaid Services; RBRVS = Resource-Based Relative Value Scale; RVW = relative value, work; PE = practice expense; PLI = professional liability insurance; CPT® = current procedural terminology; SGR = sustainable growth rate; GDP = gross domestic product; AMA = American Medical Association; RUC = Relative Value Update Committee; E&M = Evaluation and Management


* Address correspondence to Dr Smith, Duke University Medical Center, Division of Cardiothoracic Surgery, PO Box 3442, 4532 Hosp South, Durham, NC 27710 (Email: smith058{at}mc.duke.edu).


    Abstract
 Top
 Abstract
 History and Prelude
 Opportunity for Change
 Initial Engagement
 Validation, Data Collection,...
 Multidisciplinary Evaluation and...
 CMS Initial Response: The...
 STS/AATS Response to the...
 Publication of the Final...
 Assessment of the Impact...
 Next Steps
 Summary
 Appendix: Attendees of the...
 Acknowledgments
 References
 
Throughout the last 3 years, the Society of Thoracic Surgeons (STS) has put forth a major effort towards more accurate valuation of the work performed by cardiothoracic surgeons. The culmination of these efforts was realized on November 1, 2006, when the Centers for Medicare & Medicaid Services published the Final Rule which markedly increased the physician work values for the most frequently performed cardiothoracic surgery procedures. This article recounts the innovative approach taken by the STS during these extended efforts.


    History and Prelude
 Top
 Abstract
 History and Prelude
 Opportunity for Change
 Initial Engagement
 Validation, Data Collection,...
 Multidisciplinary Evaluation and...
 CMS Initial Response: The...
 STS/AATS Response to the...
 Publication of the Final...
 Assessment of the Impact...
 Next Steps
 Summary
 Appendix: Attendees of the...
 Acknowledgments
 References
 
The Resource-Based Relative Value Scale (RBRVS) was instituted in 1989 to determine the relative value of physician work (RVW), the expense of physician practice (PE), and the expense of professional liability insurance (PLI). Each component value was mandated by this original and subsequent enacting legislation to be based on the resources expended in the performance of each service (resource based). The value of each of these components is quantitated in relative value units using a system designed by Hsaio and colleagues [1, 2] that sought to establish the relativity relationships among the physician services provided by the various medical specialties. The physician work involved in a typical surgical procedure includes the immediate preoperative evaluation of the patient, intraoperative work, postoperative care in the hospital and all follow-up care for 90 days postoperatively. The relative value units (RVU) for the work, practice expense, and liability insurance components are summed and multiplied by the Medicare conversion factor to translate a procedure’s relative value units into the Medicare payment for a procedure or service described by its current procedural terminology (CPT®) code. The total amount of Medicare expenditures for physician services is controlled by the Federal Government through an annual adjustment of the conversion factor. Adjustments to the conversion factor are governed by the sustainable growth rate (SGR) formula, which depends on the rate of growth of the Medicare population and the rate of growth of the overall economy (gross domestic product [GDP]).

The actual values of each code component are determined by the Centers for Medicare & Medicaid Services (CMS), with advice from the American Medical Association (AMA) Relative Value Update Committee (RUC). This is a multidisciplinary deliberative body with 29 voting members representing a wide range of specialty societies (for more, see http://www.ama-assn.org/ama/pub/category/2292.html). Since its inception, code values have been determined by specialty society expert opinion panels or through a random survey method where physicians are asked to estimate the total relative value of a code compared to a reference code that already has an established value (magnitude estimation). Survey and/or expert panel results are presented to the RUC, which then recommends a new or refined relative value to CMS.

This relative valuation process resulted in an inexorable decline in relative and absolute reimbursement for Thoracic surgery since the inception of RBRVS in 1989 and has been well described. Fundamentally, this decline has been related to the pervasive opinion and "conventional wisdom" that cardiothoracic surgeons were overcompensated while other specialties were undercompensated, despite general recognition that thoracic and cardiac procedures are among the most complex and demanding found in the fee schedule. The devaluation of cardiothoracic surgical procedures occurred initially through a phased-in decrease in work values and in more recent years from a phased in decrease in the practice expense values after the work values were stabilized. An additional factor in the decline in reimbursement is that Medicare physician reimbursement operates as a zero-sum game in order to maintain "budget neutrality." The result is that changes in reimbursement for one specialty result in compensatory changes in reimbursement for all other physicians.


    Opportunity for Change
 Top
 Abstract
 History and Prelude
 Opportunity for Change
 Initial Engagement
 Validation, Data Collection,...
 Multidisciplinary Evaluation and...
 CMS Initial Response: The...
 STS/AATS Response to the...
 Publication of the Final...
 Assessment of the Impact...
 Next Steps
 Summary
 Appendix: Attendees of the...
 Acknowledgments
 References
 
The RBRVS enacting legislation mandates that the work value component of the physician fee schedule be open for review and "refinement" every 5 years in a process called the 5-year review. Codes felt to be improperly valued are submitted by specialty societies to CMS and CMS submits these codes and other codes of its choosing to the RUC for potential revaluation. The refinement process requires the demonstration of compelling evidence of misvaluation and the provision of evidence to the RUC that supports a new value.

In the 1995 and 2000 5-year reviews, Thoracic surgery submitted many codes for review and utilized the standard survey, magnitude estimation method to support new values. These efforts achieved limited success in 2000 for some codes, but the resulting fee schedule contained many rank order anomalies where more difficult procedures had lower work values than less complex procedures.


    Initial Engagement
 Top
 Abstract
 History and Prelude
 Opportunity for Change
 Initial Engagement
 Validation, Data Collection,...
 Multidisciplinary Evaluation and...
 CMS Initial Response: The...
 STS/AATS Response to the...
 Publication of the Final...
 Assessment of the Impact...
 Next Steps
 Summary
 Appendix: Attendees of the...
 Acknowledgments
 References
 
In November of 2003, the STS concluded that in addition to the rank order problems, there seemed to be an overall misvaluation of the entire family of cardiothoracic surgical codes. Our experience at the RUC also convinced us that the survey methodology for code valuation had many pitfalls, both methodologic and political. Our experience at the 2000 5-year review, where the "compelling evidence" to justify consideration of some of our codes was extracted from the STS database, indicated that there was an opportunity to make the valuation of our codes a much more data-driven process and one which relied less on the magnitude estimation and opinion that is embedded in the RUC survey methodology.

A total of 82 codes, representing over 72% of the annual Medicare procedural volume by Thoracic surgeons, were submitted to CMS for the 2005 5-year review. Compelling evidence was acquired from the database and submitted to demonstrate changes in the patient population, including advancing patient age, increasing incidence of diabetes, and increasing incidence of prior catheter-based interventions. Of these 82 codes, 46 were Adult Cardiac codes known to be well represented in the STS National Database, and therefore associated with robust evidence of operative time as well as evidence on the provision of both critical care and regular postoperative management throughout the length of stay. Since these three elements are major determinants of physician work, it was our hypothesis that these data could provide an unassailable foundation from which to build new code values.

The second phase occurred from January 2005 to May 2005, when we submitted a proposed new methodology for consideration by the RUC. In brief, we proposed to utilize mean skin-to-skin procedural time data from the STS National Database to define the duration of intraoperative physician work, and to estimate the intensity of intraoperative work through physician survey. Multiplying intraoperative time by intensity yields the intraoperative work value. The use of mean time, as opposed to the traditional median time, was a critical concept defining the difference between actual time data and the previously utilized survey (estimated) time data. The median must be used for estimates, to eliminate outlier values that represent bias. We argued that in order to be statistically valid, the mean data must be used for the actual recorded time, thereby capturing all of the physician work, including outlier cases. An example showing the STS database operative time distribution for mitral valve replacement is shown in Figure 1. Use of mean time data allows exact calculation of the area under the right-shifted distribution curve, which accounts for all physician work and therefore the most accurate valuation for the purpose of payment.


Figure 1
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Fig 1. Frequency distribution of intraservice (skin-to-skin) time for 6,222 mitral repair patients (CPT® code 33430). The distribution curve is asymmetric (right shifted) due to the occurrence of more long procedures than short ones. Thus, the mean time (includes all patients) is greater than the median time (excludes outliers) and is therefore preferred to account for all physician work.

 
Similarly, we would use database derived mean length of ICU and total hospital stay as a framework to assign the proper number of postoperative hospital visits (considered by the RUC to be equivalent to Evaluation and Management [E&M] services). The appropriate number of visits would then be assigned to each procedure’s global period, with one visit per day of mean hospital stay. We proposed to employ expert panels to assign the level of each E&M service as care transitioned from critical care to routine day to day hospital care. The panels would also recommend other elements of physician time as well as the number and level of office visits through the 90-day global period.

In proposing this methodology, the key concepts were:

1 Time as captured in the database is more accurate than time estimates provided by survey respondents in prior RUC surveys.
2 Intensity can only be estimated by experts, and would be within the work intensity range already established by precedent by the RUC.
3 Evidence defining the ICU stay and total hospital length of stay from the database, coupled with expert opinion, would reflect the true extent and intensity of the care that these patients receive.
4 By independently evaluating the two major components of physician work (the operation and the postoperative care), with each component based on data and not on estimates, the sum of their values would be far less subject to alteration in subsequent multidisciplinary RUC review.


    Validation, Data Collection, Recommendations
 Top
 Abstract
 History and Prelude
 Opportunity for Change
 Initial Engagement
 Validation, Data Collection,...
 Multidisciplinary Evaluation and...
 CMS Initial Response: The...
 STS/AATS Response to the...
 Publication of the Final...
 Assessment of the Impact...
 Next Steps
 Summary
 Appendix: Attendees of the...
 Acknowledgments
 References
 
The proposed methodology stimulated vigorous and often heated debate at the RUC, but ultimately was approved by this committee for use in the 5-year review at the April 2005 regular meeting. The STS National Database was then queried, to include the Fall 2004 harvest, and 1,623,457 procedural records were utilized in developing new proposed code values. For example, records from 546,586 CABG patients operated on since the last 5-year review in 2000 were utilized and demonstrated increased patient age and comorbidity, thereby establishing the required compelling evidence for the need for code revaluation. By way of comparison, an "acceptable" RUC survey for valuation of a code must include responses from 30 or more physicians. These data provided the operative time and length of stay framework for each code that had been submitted, factors that had been only estimated in the RUC survey process prior to this time.

Operative intensity surveys, using two novel methods of estimation [3–6], were developed, trialed, and sent to the active, US practicing STS membership roster in May, 2005. A total of 533 Adult Cardiac intensity surveys and 511 General Thoracic intensity surveys were completed, and surgeons from all but three States responded. The declared practice mix was 60% private, 36% academic, and 4% other, which is a representative distribution indistinguishable from workforce survey and STS National Database participation. Expert Panels composed of 32 Thoracic Surgeon volunteers (see Appendix) met on July 14 and 15 in Chicago in all day sessions after all the elements of the building block methodology (operative time and intensity, length of ICU and hospital stay) were available. These panels reviewed and confirmed the validity of surveyed intensity levels for each procedure under review and confirmed that an appropriate rank order of intensity had been established by our member surveys for the Cardiac and General Thoracic codes. The physician work times, as well as the number and level of perioperative visits, were established by consensus development, with prearranged professional facilitation and proctoring by neutral RUC observers who attended at our request.

The recommendations of the expert panels were merged with the data from the STS Database to lead to new, refined RVW recommendations. One of the key elements for determining operative work was the mean skin-to-skin time from the STS database. One of the major concerns of CMS and the RUC was that these times would be overestimated by the database. In fact, the STS database times varied significantly from the extant survey determined times used by RUC/CMS for current code values as seen in Figure 2. Although some code intraservice times were underestimated, there was indeed a systematic difference, which was that the old survey process resulted in a time overestimate (approximately 7.2% for the Cardiothoracic codes).


Figure 2
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Fig 2. The difference between the STS database intraservice time and the intraservice time determined by RUC survey (and employed in current code valuation) is illustrated as a percent difference for all cardiothoracic codes submitted for revaluation, sorted in descending percent difference. Many codes are severely under- and overestimated by the RUC survey estimation process, with the majority to the right and actually overestimated. (RUC = Relative Value Update Committee; STS = The Society of Thoracic Surgeons.)

 
The negative impact of time reduction using the database information was offset by intensity survey results that described somewhat higher relative intensity for these procedures, compared to reference intensities from previously approved RUC standard procedures. The intensity value for each adult cardiac code, by each of the two survey methods and an average of the values from the two methods, is shown in Figure 3. The assignment of appropriate E&M services (hospital and office visits) and the utilization of mean length of stay data were critical elements used to achieve accurate valuation of the perioperative care component of the global period. Figure 4 illustrates the additional hospital day where care is delivered to the average mitral valve repair patient whose mean LOS is 8 days, as opposed to a median LOS of 7 days. Also illustrated is the impact of adding the work value for critical care to the first postoperative day, which was supported by STS database information but generally not allowed in past valuations by the RUC and CMS.


Figure 3
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Fig 3. The survey results for the intensity of physician intraoperative work for the submitted Adult Cardiac codes is shown, in ascending order of intensity. The ordinate is IWPUT multiplied by 1000. Two methods were used (an Intensity Survey using magnitude estimation, and a Rasch paired analysis comparison) and are displayed as the lower and upper lines, respectively. The average of the two methods is the third line, and these values were used in the RUC recommendations. For clarity, only selected CPT® code numbers are shown on the abscissa. (CPT® = current procedural terminology; IWPUT = intraservice work per unit time; RUC = Relative Update Committee.)

 

Figure 4
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Fig 4. The frequency distribution of length of stay for mitral valve repair (N = 7,985) is shown, with the relative value for E&M services provided each day for a typical patient superimposed. Solid E&M value is the current assigned value, and the hash marked component indicates additional value approved by the RUC. On day 0, the additional value is due to the assignment of a critical care code 99291. On day 7, the value represents an additional E&M service, allocated because the mean LOS was one day higher than the median LOS for this code. (E&M = Evaluation and Management; LOS = length of stay; RUC = Relative Update Committee.)

 

    Multidisciplinary Evaluation and RUC Recommendations
 Top
 Abstract
 History and Prelude
 Opportunity for Change
 Initial Engagement
 Validation, Data Collection,...
 Multidisciplinary Evaluation and...
 CMS Initial Response: The...
 STS/AATS Response to the...
 Publication of the Final...
 Assessment of the Impact...
 Next Steps
 Summary
 Appendix: Attendees of the...
 Acknowledgments
 References
 
The STS recommendations were then forwarded to the RUC. In the RUC 5-year review process, all recommended code value changes are initially considered by a 7-member "5-Year Review Workgroup," and this group met in August of 2005. The Workgroup was composed of selected RUC members or advisors, and a CMS observer. During an 11-hour session, each of the 82 cardiothoracic surgery codes was presented individually by STS representatives and then discussed and "refined" by the workgroup members. While the STS recommendations for the intraoperative work units were accepted, and the perioperative time and visit data were slightly reduced, these alterations were acceptable to STS. The revised recommendations were forwarded to the RUC for consideration in its September 2005 meeting, but a minority dissenting report was filed by 2 of the 7 workgroup members who disputed the assignment of critical care codes to the global period for most of the cardiothoracic surgical procedures. These members also disputed the new methodology and the use of STS database data in the process.

Between the August workgroup deliberations and the full RUC meeting in September, we conducted an urgent survey of STS membership to address the RUC Workgroup’s concerns regarding critical care. Responses were obtained from 211 surgeons and the results clearly indicated that the majority of our patients received care in dedicated cardiothoracic critical care units that were not staffed by intensivists. The survey also demonstrated that the typical patient received sufficient critical care management time by their surgeon to justify inclusion of at least one critical care visit in the global surgical period. In addition, the survey confirmed the STS position that critical care specialists can be significantly involved in the care of our patients, but that this service supplements rather than duplicates the critical care services provided by the operating surgeon.

The workgroup recommendations and the minority report were then considered by the entire RUC at the scheduled September 2005 meeting. STS representatives presented the new critical care survey results and argued forcefully for the inclusion of critical care in the surgical bundle, and for the work values recommended by the Workgroup. A heated and often contentious committee discussion lasted over 4 hours, but the ultimate result was the acceptance of the Workgroup and STS proposed values by the required 2/3 majority vote. These values were submitted by the RUC to CMS for consideration, where historically 95% of all RUC recommendations are accepted.

It is noteworthy that this entire 5-year review process occurred in the context of a simultaneous RUC deliberation on a proposal to significantly increase the RVWs for all E&M services (office visits, hospital visits, and consultations which in the aggregate represent over 15% of all Medicare payments for physician services). If accepted by the RUC and CMS, the proposed increased values in E&M services would result in substantial reductions (in the range of 10–15%) for all non-E&M physician services in order to "correct" the overall physician fee schedule and thus maintain budget neutrality. The RUC approved somewhat lesser but still substantial increases for these E&M codes, and also agreed that any E&M increase would be reflected in commensurate increases for the E&M services provided in the pre- and postoperative period within the 90-day global period. This "pass through" of the new E&M proposed values added total work value to the codes we submitted, to the remaining 204 codes that are predominantly used by Thoracic Surgeons, and to all procedural codes with 90 day global periods. This effect is illustrated for our mitral repair example in Table 1.


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Table 1. Detailed E&M RVW Data for Mitral Valve Repair, Showing the E&M Visits and Values Assigned Each Day for the Typical Patient Currently and as Updated for 2007
 

    CMS Initial Response: The Proposed Rule
 Top
 Abstract
 History and Prelude
 Opportunity for Change
 Initial Engagement
 Validation, Data Collection,...
 Multidisciplinary Evaluation and...
 CMS Initial Response: The...
 STS/AATS Response to the...
 Publication of the Final...
 Assessment of the Impact...
 Next Steps
 Summary
 Appendix: Attendees of the...
 Acknowledgments
 References
 
Nine months later, on June 29, 2006, CMS published the proposed rule (http://www.sts.org/documents/pdf/CMSProposedJune2006-CTOnly.pdf) for physician payment for 2007 and its response to the RUC recommendations. In summary, CMS rejected the RUC recommended STS methodology and the RUC recommended values for the refined codes, proposing alternate values with some increases rather than simply maintaining the current 2006 values (Fig 5). Additionally, CMS proposed to accept a $4 billion increase in E&M services, which would have to be offset by a 10% reduction in all CPT® code work values (budget neutrality adjustment) for the purposes of calculating Medicare payment only. As well, CMS announced that there would be a scheduled 5.0% reduction in the conversion factor, which has now been revised by Congressional action. Finally, CMS announced a 4-year phase in of a new method of determination of the Practice Expense component, which will generally reduce PE payment for Thoracic Surgery once again.


Figure 5
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Fig 5. The relative value work units for all submitted Cardiothoracic codes are illustrated here, in ascending order of the RUC recommendations. Also shown are the current (2006) RVWs, and the CMS values suggested in the June 2006 proposed rule. The lack of relativity and generally lower total value of the current code values and those proposed by CMS are apparent, compared to the RUC recommendations, as is a general failure to acknowledge the physician work in more complex and longer procedures. The RUC recommended values are identical to those now accepted by CMS and used to value these codes for 2007. (CMS = Centers for Medicare & Medicaid Services; rvu = relative value units; RUC = Relative Update Committee; STS = The Society of Thoracic Surgeons.)

 

    STS/AATS Response to the Proposed Rule
 Top
 Abstract
 History and Prelude
 Opportunity for Change
 Initial Engagement
 Validation, Data Collection,...
 Multidisciplinary Evaluation and...
 CMS Initial Response: The...
 STS/AATS Response to the...
 Publication of the Final...
 Assessment of the Impact...
 Next Steps
 Summary
 Appendix: Attendees of the...
 Acknowledgments
 References
 
During the public comment period that followed, STS representatives developed a 54-page critical response requesting that CMS reconsider and accept the RUC recommended work values for the cardiothoracic surgical codes and the RUC approved concept of incorporating database information into the process of code valuation. The written response was submitted in August 2006 and can be viewed on the STS website (http://www.sts.org/documents/pdf/STS-AATS.Response.CMS.pdf). STS workforce members met with CMS to present yet again the compelling evidence in support of the RUC recommendations. We also enlisted the support of many medical specialty societies including the American College of Surgeons, American College of Cardiology, American Society of Anesthesiologists, and American Academy of Neurology, each of whom submitted written comments to CMS supporting the values recommended through the RUC process. The AMA-RUC committee also met with CMS and submitted written comment in support of the RUC position and the code valuation recommendations.


    Publication of the Final Rule
 Top
 Abstract
 History and Prelude
 Opportunity for Change
 Initial Engagement
 Validation, Data Collection,...
 Multidisciplinary Evaluation and...
 CMS Initial Response: The...
 STS/AATS Response to the...
 Publication of the Final...
 Assessment of the Impact...
 Next Steps
 Summary
 Appendix: Attendees of the...
 Acknowledgments
 References
 
As a result of these efforts, CMS reversed its position, accepting the RUC approved methodology and the RUC recommended values for cardiothoracic procedures in its publication of the Final Rule on November 1, 2006. This reversal was unprecedented in scope and magnitude of impact, and will provide substantial increases in the relative work value units assigned to cardiothoracic surgical procedures compared to the current values. CMS also announced that an overall 10.1% reduction in the published full value RVWs would be utilized to determine Medicare payment, in order to maintain budget neutrality. The change in the full and Medicare discounted values for all cardiothoracic codes of interest are illustrated in Figure 6. Finally, CMS announced a 25% phase in of their new methodology to determine practice expense, which will have a generally negative effect on cardiothoracic codes.


Figure 6
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Fig 6. Change in RVW and for 2007 Medicare payment discount. The change in RVW for each code is illustrated arranged in descending value change for the revalued codes and the remaining codes used by Cardiothoracic surgeons but not addressed in this 5-year review. The upper line for each code group is all positive, indicating increased assigned work value units. Increases were higher for revalued codes due to the process described in this article. There were also small increases for the remaining codes due to the "pass through" of the increase in E&M services to all procedural global periods. The lower line for each code group shows the value change that will be used to determine Medicare payment only. The difference is due to an internal adjustment of the RVWs to effect budget neutrality. (AATS = American Association for Thoracic Surgery; E&M = Evaluation and Management; RVU = relative value units; RVW = relative value work units; STS = The Society of Thoracic Surgeons.)

 
The details of the Final Rule by CPT® code for cardiothoracic procedures are available at the following link: http://www.sts.org/documents/pdf/CMSFinalNov2006-CTOnly.pdf. The complete document is publicly available at the CMS website: http://www.cms.hhs.gov/center/physician.asp.

This CMS decision provides a strong signal in support of database development that will promote fair and accurate code valuation. It is our contention that changes in the current RUC valuation process were necessary to insure fair and accurate valuation, and we believe that use of data rather than estimation will improve the valuation of new codes and the codes that will be submitted in the next 5-year refinement (now only 3 years away).


    Assessment of the Impact and Implications of the Final Rule
 Top
 Abstract
 History and Prelude
 Opportunity for Change
 Initial Engagement
 Validation, Data Collection,...
 Multidisciplinary Evaluation and...
 CMS Initial Response: The...
 STS/AATS Response to the...
 Publication of the Final...
 Assessment of the Impact...
 Next Steps
 Summary
 Appendix: Attendees of the...
 Acknowledgments
 References
 
This effort has convinced the RUC and CMS that the vast majority of our codes were undervalued, due to changes in our patient population and due to systematic problems in the implementation and maintenance of RBRVS.

The overall impact on total code value is a 12.3% positive update (14.1% for refined codes, 3.3% for the remaining codes). This impact was reduced for Medicare payment, where there is a 4.8% increase (6.4% for refined codes, –3.2% for the remaining codes). It is important to note that this includes a 14% increase (5% increase for Medicare patients) in the total values for E&M services performed independently by Cardiothoracic surgeons.

In our judgment, these successes in this process were due to:

1 An appreciation by the RUC that there had been true undervaluation of the CT surgical codes that were submitted for the 5-year review in relation to the rest of the physician fee schedule.
2 This undervaluation became much more evident by the separate consideration of the two major components of physician work for a surgical procedure—intraoperative care and perioperative care—which now are valued separately rather than valuing them together.
a For the operation, estimating intensity and using the database to certify time were major factors. By showing that intensity was within an appropriate range compared to the accepted intensity for other physician services, the resulting operative work values became unassailable.
b For perioperative care, using the database to certify duration of ICU and total in-hospital care and then using expert opinion and surveys to show a high level of E&M type services provided by the surgeon for the majority of our procedures were persuasive.

3 The employment of mean data rather than median data for time and length of stay was also important. This allowed the inclusion of outliers in the determination of the work value and ensured that all physician work is captured and represented in the code values.


    Next Steps
 Top
 Abstract
 History and Prelude
 Opportunity for Change
 Initial Engagement
 Validation, Data Collection,...
 Multidisciplinary Evaluation and...
 CMS Initial Response: The...
 STS/AATS Response to the...
 Publication of the Final...
 Assessment of the Impact...
 Next Steps
 Summary
 Appendix: Attendees of the...
 Acknowledgments
 References
 
Many lessons have been learned in this 3-year effort and these need to be incorporated into our ongoing efforts in working with the RUC and CMS, as well as with other specialty societies.

1 Since we operate within a government-imposed budget neutral environment, we have been forced to endure unnecessary conflict with other specialty societies to divide a fixed amount of funds through the mechanism of individual code valuation. We must develop methods to ensure adequate funding of the physician payment system outside of RBRVS, to minimize perturbations to code values that result from payment issues rather than relativity issues. In this, we are aligned with all physicians.
2 Within RBRVS, we should align with all physicians to ensure that the Practice Expense and Professional Liability components are adequately compensated independent of the Physician Work component. It is the work component that represents payment for the professional services that we provide, and is being eroded by the need to subsidize unfunded increases in practice expense (eg, drugs administered in physician offices, devices, equipment, supplies, etc) related to inflation, technological advances and the transition of procedures from the hospital setting to the office setting. In the Final Rule, CMS has committed to a change in practice expense calculation to be phased in through 2010. The initial "installment" is a reduction of some $6.4 million in payments to cardiothoracic surgeons in 2007, substantially blunting the RVW increases achieved. The final total reduction will be approximately $24 million by 2010, and if implemented will effectively neutralize the positive RVW effect of the 5-year review for Medicare patients.
3 We must encourage the development and application of databases by other specialties for use in determining physician work and therefore payment. Our efforts have demonstrated that significant anomalies exist in the current time and effort database, which is based on time estimates, but which is utilized by CMS to determine physician payment. These anomalies are in part a result of survey methodology which, in the context of budget neutrality, has led to artificially inflated estimates of the amount of physician time involved in various physician services. Correction of these anomalies through database incorporation will have unpredictable effects, but will certainly lead to increased accuracy that is in the interest of all specialties.
4 We must improve our own database, which was not specifically designed to yield data that could be employed in the RBRVS valuation process. First, we must obtain data for adult cardiac procedures that were not addressed in this 5-year cycle, principally because they are either low frequency or because they are poorly defined in the current database procedure descriptions. A significant number of important CPT® codes could not be unequivocally related to STS Database procedures and therefore could not be submitted for review. In order to enhance accuracy of database use, we propose that the CPT® code information used for billing each procedure be captured in the database. Second, we must increase enrollment in all three components (Cardiac, General Thoracic, and Congenital) of our database. For the General Thoracic database, we must establish conditions so that surgeons from other specialties performing these procedures can and do participate.
5 We must develop and enhance our role in the science and practice of critical care. We have not participated sufficiently in the national process of defining critical care as a specialty and in defining the advancing role of 24/7/365 intensive care in hospitals as the emerging standard of care, despite the fact that we have traditionally held critical care as a core competency of our specialty and all of our patients require critical care services. As part of this process, we must enhance the database to capture information that will serve to indicate the extent of E&M services that are provided to each patient.


    Summary
 Top
 Abstract
 History and Prelude
 Opportunity for Change
 Initial Engagement
 Validation, Data Collection,...
 Multidisciplinary Evaluation and...
 CMS Initial Response: The...
 STS/AATS Response to the...
 Publication of the Final...
 Assessment of the Impact...
 Next Steps
 Summary
 Appendix: Attendees of the...
 Acknowledgments
 References
 
We have achieved a major improvement in working within the system of RBRVS and as a result, the majority of our codes are now valued at appropriate relative levels of physician work within the Physician Fee Schedule.

The impact on individual practices will be related to their mix of Medicare patients, procedure type, and their contracting status with other payers. It is imperative that members immediately incorporate the new code values into their fee schedules and be sure that they are utilized in contract negotiation with the payers other than Medicare who base their fee schedules on RBRVS. A list of the refined values and the new values for codes of interest to Thoracic Surgeons is available at the STS website http://www.sts.org/documents/pdf/CMSIndividualCodeImpact11_2_2006_pdf.

It is sobering to note that actual payments that physicians will receive continue at risk, at least for Medicare payment, despite Congress’ last minute removal of scheduled global neutrality adjustments (–5.0%). These adjustments are related to factors beyond physician control and require annual Congressional action that acknowledges that, at the very least, the total cost of caring for Medicare Beneficiaries is not decreasing.


    Appendix: Attendees of the Expert Panel Meetings in Chicago
 Top
 Abstract
 History and Prelude
 Opportunity for Change
 Initial Engagement
 Validation, Data Collection,...
 Multidisciplinary Evaluation and...
 CMS Initial Response: The...
 STS/AATS Response to the...
 Publication of the Final...
 Assessment of the Impact...
 Next Steps
 Summary
 Appendix: Attendees of the...
 Acknowledgments
 References
 
Adult Cardiac Expert Panel
Lishan Aklog

John C. Alexander*

Jeffrey N. Bott

Brian L. Cmolik

Verdi J. DiSesa*

Anthony P. Furnary

Steven W. Guyton

Harold L. Lazar*

Robert R. Lazzara

Carmelo Milano

William C. Nugent

Jeffrey B. Rich

Jerome B. Riebman

Todd K. Rosengart

Mark S. Slaughter

General Thoracic Expert Panel
Matthew G. Blum

David B. Campbell

Neri M. Cohen

Richard H. Feins

Mark K. Ferguson

David H. Harpole

Stephen R. Hazelrigg

Robert B. Lee*

James M. Levett*

Robert Moss

Francis C. Nichols, III

Jemi Olak

Marc C. Silver

Cameron D. Wright*

Joseph B. Zwischenberger

and

Winfield J. Wells*

Stephen J. Lahey*

Grayson H. Wheatley, III*

Asterisks denote members of the STS/AATS Workforce on Nomenclature and Coding.


    Acknowledgments
 Top
 Abstract
 History and Prelude
 Opportunity for Change
 Initial Engagement
 Validation, Data Collection,...
 Multidisciplinary Evaluation and...
 CMS Initial Response: The...
 STS/AATS Response to the...
 Publication of the Final...
 Assessment of the Impact...
 Next Steps
 Summary
 Appendix: Attendees of the...
 Acknowledgments
 References
 
Special thanks to Julie Painter, Dr. Robert A. Guyton, Michael Hogan, Jan Martin, Gregory Shook, Lawrence Muhlbaier, and the members of the STS/AATS Workforce on Nomenclature and Coding, who invested countless hours in this effort for our profession.


    References
 Top
 Abstract
 History and Prelude
 Opportunity for Change
 Initial Engagement
 Validation, Data Collection,...
 Multidisciplinary Evaluation and...
 CMS Initial Response: The...
 STS/AATS Response to the...
 Publication of the Final...
 Assessment of the Impact...
 Next Steps
 Summary
 Appendix: Attendees of the...
 Acknowledgments
 References
 

  1. Hsaio WC, Braun P, Kelly NL, Becker ER. Results, potential effects and implementation issues of the Resource-Based Relative Value Scale JAMA 1988;260:2429-2438.[Abstract]
  2. Hsaio WC, Couch NP, Causino N, Becker ER, Ketchan TR, Verrillie DK. Resource-based relative values for invasive procedures performed by eight surgical specialties JAMA 1988;260:2418-2424.[Abstract]
  3. Florin RE. Rasch analysis in measurement of physician work Journal of Outcome Measurement 2000;4:564-578.[Medline]
  4. McHorney CA, Monahan PO. Postscript: applications of Rasch analysis in health care Medical Care 2004;42(1 Suppl):I73-I78.[Medline]
  5. Braun P, Hsiao WC, Becker ER, DeNicola M. Evaluation and management services in the Resource-Based Relative Value Scale JAMA 1988;260:2409-2417.[Abstract]
  6. Zwolak RM, Trout 3rd HH. Vascular surgery and the Resource-based Relative Value Scale five-year review Journal of Vascular Surgery 1997;25:1077-1086.[Medline]

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At Last, Inequities in Reimbursement Modified by Real Evidence-Based Data
Ann. Thorac. Surg., January 1, 2007; 83(1): 9 - 11.
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