Changes Afoot in Workers’ Compensation Coding Rules

By Karen O’Hara

State workers’ compensation coding and billing rules believed to be in need of an overhaul have captured the attention of occupational medicine physicians. An American College of Occupational and Environmental Medicine (ACOEM) committee has put the wheels in motion to introduce alternative coding and billing ground rules that state workers’ compensation systems and/or insurance carriers could apply to certain evaluation and management (E&M) codes—a subset of Current Procedural Terminology (CPT® American Medical Association) codes. If the proposed rules gain traction with states and payers, committee members believe workers’ compensation system stakeholders and society, in general, would likely benefit from related cost savings and decreased work-related disability. While occupational health programs and clinicians could potentially experience a bump in reimbursement, proponents say the intention is to better align incentives and improve workers’ health outcomes, not increase pay for doctors. The recommended ground-rule changes primarily involve documentation and coding of E&M encounters, case management, and consultation services. “There’s a long-standing disconnect between required documentation in patient encounters in order to be paid and what needs to be done in a clinical workers’ compensation encounter in order to practice evidence-based medicine and have good outcomes,” said physicians who contributed to an ACOEM Coding Project Position Paper, which was adopted by the ACOEM Board of Directors in May and is slated for public release later this year.

“We think that by paying for the right kind of attention early in a case and avoiding harmful or excessive care, employers and insurers will pay less medical costs in the end,” said Marianne Cloeren, M.D., M.P.H., chief medical officer, Managed Care Advisors, who has been instrumental in developing the proposed billing and coding reforms.

APPLICABLE CODING

Occupational health providers are subject to federal and state workers’ compensation systems that generally adhere to Centers for Medicare and Medicaid (CMS) rules and use of the CPT coding system for personal healthcare encounters. This causes misalignment of reimbursement for activities considered essential to effective workers’ compensation case evaluation and management.

Under current rules, factors that apply include:

Setting for the visit – new or established office patient or other visit setting.
Extent of medical history.
Extent of physical exam.
Complexity of medical decision-making.

APPLICABLE CODING

Occupational health providers are subject to federal and state workers’ compensation systems that generally adhere to Centers for Medicare and Medicaid (CMS) rules and the use of the CPT coding system for personal healthcare encounters. This causes misalignment of reimbursement for activities considered essential to effective workers’ compensation case evaluation and management.

Under current rules, factors that apply include:

Setting for the visit – new or established office patient or other visit setting.
Extent of medical history.
Extent of physical exam.
Complexity of medical decision-making.

While a complete review of the body’s organ systems is needed to bill for a comprehensive level of care, occupational physicians say it rarely yields useful information in a work-related treatment encounter. On the other hand, a detailed social history can be invaluable, but there is no incentive for obtaining more than basic social information.

In addition, there is little incentive for an evaluating clinician to obtain more occupational history than the patient’s job title, even though information about specific job tasks, physical demands, the need for personal protective equipment, and other factors related to the work environment is needed for a thorough evaluation. Occupational medicine clinicians are also not fully compensated for their time when they inquire about adverse childhood experiences that can affect adult attitudes about health status and recovery, previous workers’ compensation claims, perceived injustice, conflict with a supervisor, and other red flags for potential long-term disability.

Proponents of the rule changes say other types of inquiries, such as a physical examination unrelated to the work-related injury or illness or investigation into a worker’s genetic predisposition for disease, should be discouraged.

“There is strong evidence that the nation has unrealized opportunities to achieve substantial savings in the treatment of injured workers, as well as better health outcomes.” —ACOEM draft coding project position paper

PROPOSED GROUND RULES

States may legally choose to redefine and/or create billing codes that differ from CPT codes and adopt a corresponding workers’ compensation medical fee schedule. ACOEM members report that many states have already done this for specific purposes, such as the preparation of specialized reports, delivery of certain services related to chronic opioid prescribing, and communication with employers and payers.

As proposed, revised coding and billing rules would de-emphasize history and exam elements that are not relevant to a work-related injury or illness and instead focus on work-related factors, return to function, and disability risk mitigation. Treating clinicians would be paid for being attentive to a worker’s functional status, projected recovery, and other details that are considered pivotal for return to work and successful case resolution.

Other recommendations include:

Create and deploy a model for a comprehensive occupational, functionally-oriented musculoskeletal exam to support proper care and documentation of a work-related injury or illness.
Expand the use of consultation codes in workers’ compensation care. The CPT manual defines a consultation as an E&M service provided at the request of another medical professional to recommend care for a specific condition or problem or to determine whether to accept responsibility for the ongoing management of the patient’s care. Consultation codes are no longer recognized by CMS, but they are considered relevant to work-related medical care and are still used in some state workers’ compensation systems.

3. Recognize the case management codes that can be applied to workers’ compensation care.
4. Adopt new codes to fill gaps when there are no existing appropriate codes for services considered essential to reducing costs and improving outcomes.
5. Minimize changes by keeping CMS rules that work.
6. Document a new work injury in a known patient as a new encounter.

“Our recommendations would encourage physician attention to critical factors in workers’ compensation that are absent or minimized in the current pay system coding by financially recognizing the actual value, expertise, and effort provided for a given high-quality OEM level of service,” physicians say in the draft coding position paper.

Related benefits may include opportunities to address the nation’s occupational medicine physician shortage by creating avenues for professional development and retention and, assuming the roll-out of the concept to payers is carefully managed, an enhanced ability to counter the effects of down-coding.

In conjunction with the position paper, ACOEM is assembling supporting materials and study findings which will be used to encourage:

States to pass legislation that aligns compensation with desired physician behaviors (programs in Colorado and Washington provide useful examples).
Workers’ compensation commissions or administrations, insurers, payers, and self-insured employers adopt alternative proposed ground rules for documentation of care for each level of service.

WHY TRY?

While acknowledging they face an uphill slog, proponents appear to be motivated by “unrealized opportunities” in most U.S. states. The basic, underlying premise is three-fold, said Lee Glass, M.D., J.D., associate medical director, State of Washington, Department of Labor and Industries (L&I):

Physicians should be fairly paid for care provided to injured workers.
Everyone benefits when injured workers are returned to health and function as efficiently and as safely as possible; the workers’ compensation system should be designed accordingly.
The easiest way to get someone to do what you want is to pay them for doing it.

As a monopolistic workers’ compensation system, Washington has an advantage over most other states because it controls the payment system and is able to serve as an incubator for innovation. (Only three other states – North Dakota, Ohio, and Wyoming – have monopolistic state funds in which all workers’ compensation insurance is sold by a state-controlled entity.)

Washington L&I developed and supports the Centers of Occupational Health and Education (COHE), which works with medical providers, employers, and injured workers in community-based programs. COHEs train providers and assist with care coordination to improve injured worker outcomes and reduce disability risk.

COHEs recruit and enroll participating providers in their service areas. COHE providers, many of whom are not trained in occupational medicine, must adhere to defined practice parameters in order to receive maximum reimbursement. These include:

Prompt submission of a Report of Accident form (preferably within two days of the initial encounter).
Call the employer if a worker is to be taken off work or put on restricted duty.
As long as a case is open, see an injured worker at least every two weeks and complete an activity prescription form at each visit.
Performing a comprehensive disability assessment exam if an injured employee is not recovering, and there is no apparent medical reason.

In a related study involving approximately 32,000 workers, the University of Washington researchers compared lost time, disability, and medical costs in non-COHE-managed cases to COHE-managed cases. Among the findings, COHE-managed cases resulted in: