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AAP updates policy on pediatric application of coding, valuation systems :

September 30, 2019

As physician payment evolves, standardized code sets continue to play an essential role in defining clinician services and the diagnostic basis for those services. Whether submitting claims for fee-for-service payments or contracting for more advanced alternative payment models, pediatricians should be familiar with the basic concepts underlying Current Procedural Terminology(CPT), International Classification of Diseases, Tenth Revision, Clinical Modification (ICD-10-CM) and other code sets to support effective payment and payer communication.

To highlight the Academy’s perspective and provide background on coding and valuation, the AAP has updated the policy statement Pediatric Application of Coding and Valuation Systems from the Committee on Coding and Nomenclature (COCN) and the Payer Advocacy Advisory Committee. A technical report provides additional context. The policy is available at and the technical report at Both will be published in the October issue of Pediatrics.

Importance of CPT in fee-for-service claims

CPT is the mainstay of claims-based fee-for-service physician payment. The AAP and COCN advise the CPT Editorial Panel during code development as well as educate AAP members on CPT issues relevant to pediatrics. Such engagement supports CPT codes that address the broad scope of pediatric care. The AAP encourages payers to adopt the CPT code set along with accompanying CPT coding guidance and rules to ensure comprehensive, consistent representation of the care rendered by pediatricians.

Surveys inform RVUs

The AAP also participates in the assignment of relative value units (RVUs) for new and revalued services through the Relative Value Scale Update Committee (RUC). AAP members play an important role by completing specialty surveys distributed by the Academy on behalf of the RUC to assess appropriate RVU assignment for new, modified or revalued services.

The Centers for Medicare & Medicaid Services (CMS) publishes RVUs annually in its Medicare Physician Fee Schedule. Regardless of Medicare coverage, the Academy encourages CMS to publish all RUC-valued services to provide clarity to non-Medicare payers regarding appropriate valuation.

Models identify patient risk

ICD-10-CM plays an increasingly prominent role not only in validating the clinical basis for services but also identifying patient risk and complexity. Especially with alternative models that may impose payment benchmarks, identifying clinical risk through algorithms, such as ICD hierarchical condition categories, is important for accurate representation of the physician’s patient profile. Ensuring that the CMS claim form accommodates the expanding number of relevant diagnoses to describe the encounter becomes even more important with risk-based differentiation.

In acknowledgment of CPT’s importance among the broad scope of payers relevant to pediatric care, the Academy encourages expeditious reconciliation of other standardized code sets with CPT. This includes the Level II Healthcare Common Procedure Coding System (HCPCS), which often is used to create Medicare-specific services using G-codes. In addition, Medicare reliance on non-CPT codes, such as preventive annual wellness G-codes, limits the applicability of Medicare guidance to CPT-coded scenarios such as teaching physician exemptions in primary care.

Due to payer variation in claim formatting instructions, other standardized code sets such as National Drug Codes require attention to payer-specific guidance when reporting office-dispensed pharmaceuticals.

Medicaid parity

Because of the importance of Medicaid in supporting appropriate care for pediatric patients, it is essential that Medicaid rates are at least equal to those of Medicare. Although state Medicaid programs vary, Medicaid should maintain a national database of its services using reported CPT and ICD codes to support tracking of health care utilization across Medicaid programs.

In recognition of the ubiquitous role of the National Correct Coding Initiative program in imposing code pair edits that impact payment when reporting same-session services, the AAP and COCN monitor these edits to minimize administrative burden for pediatricians.

Focus on long-term outcomes

Quality metrics are becoming increasingly important in design of alternative payment models. While many quality metrics focus on short-term processes and outcomes, pediatric care is unique in its focus on long-term care of the growing and developing child. Development of pediatric-relevant quality metrics should reflect preventive and anticipatory services rendered throughout childhood and focused on long-term outcomes.

Dr. Kanter is the lead author of the policy and technical report. He is a member of the AAP Committee on Coding and Nomenclature.

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