Pediatric Application of Coding and Valuation Systems

The American Academy of Pediatrics (AAP) 2014 policy statement on the pediatric application of the resource-based relative value scale (RBRVS) noted that the “RBRVS system should continue to be the preferred process to establish physician payment.”¹  Even in the current era of evolving models of physician payment, the RBRVS, the coding principles on which it is built, and the code sets that foster standardized communication remain the most effective systems to ensure transparency, relativity, and representative fairness in clinician service valuation. In recognition of the role these tools continue to play in the changing landscape of health care payment, the AAP Committee on Coding and Nomenclature, in collaboration with the Private Payer Advocacy Advisory Committee, provides the following recommendations that update the 2014 policy statement. These recommendations reflect the impact that these coding systems have in current payment models and clinical nomenclature, and an accompanying technical report provides instructive background information on the RBRVS, Current Procedural Terminology (CPT), and International Classification of Diseases, 10th Revision, Clinical Modification (ICD-10-CM) standardized code sets, and current payment principles.

We recommend the following.

1. Confirm the importance of the RBRVS. The RBRVS currently remains the most effective process by which individual health care services are valued, and the American Medical Association–Specialty Society Relative Value Scale Update Committee (RUC) is the only committee charged with developing valuation recommendations for the RBRVS. The AAP actively participates in the RUC process, which allows pediatricians to provide direct input into how pediatric services are valued and paid relative to all other medical services. Even in an era in which alternative payment models compete with fee-for-service payment, the RBRVS provides a framework to assign relative values for physician work and practice expenses. Within payment models that bundle groups of services, the elements of the RBRVS provide the basis for effectively assessing the value of the bundle. As services, especially preventive medicine visits, expand in the scope of recommended elements (such as vision, hearing, and other types of preventive screening) in response to AAP guidance, such as Bright Futures: Recommendations for Preventive Care of Infants, Children, and Adolescents, Fourth Edition, relative value unit (RVU) assignment allows for appropriate assessment of the overall composite service inclusive of its different components.

2. Engage in the RUC survey process. Effective RBRVS valuation requires clarity, relevance, and reliability in the RUC survey process. Pediatricians should understand the importance of the AAP survey in rendering RUC valuation decisions and should not allow familiar routine or repetitive experience to lead to underestimation of the work inherent in the service. Optimal nonprocedural survey tools define and quantify the unique aspects of physician work (such as facilitated care delivery and communication² ) required to care for medically complex children, and nonprocedural services should be appropriately and competitively valued relative to procedural services. Because valuation of some types of nonprocedural work may be underrepresented relative to interventional procedures, RVUs may not be fully representative of physician productivity when comparing care dominated by nonprocedural as opposed to procedural work. In assessing physician productivity, reliance solely on RVUs could potentially underestimate nonprocedural scenarios if RVUs are not accurately reflective of the work, especially those inherent in complex pediatric care.

3. Support Centers for Medicare and Medicaid Services (CMS) RVU publication of RUC-valued services. Although the RUC provides valuation recommendations, the CMS maintains decision-making authority to accept or modify those recommendation for publication in its annual Medicare Physician Fee Schedule (MPFS). Currently, the CMS publishes RVUs for all Medicare-covered services; however, reliable pediatric representation requires that the CMS also publishes the RUC-recommended RVUs for those services not covered by Medicare. Most non-Medicare payers, including Medicaid and commercial insurers, rely on the published RVUs in the MPFS to construct their own independent fee schedules. Because a relatively greater number of pediatric services fall into Medicare’s noncovered category, greater potential exists for nonpublication of essential pediatric services in the MPFS. The absence of noncovered services (and their RVUs) in the MPFS is especially detrimental to pediatric care and the desire of payers to reliably value the pediatric services they cover. Because many of the non-Medicare pediatric-relevant services are covered by Medicaid programs, and thus remain in the CMS domain, CMS publication of these RVUs would support Medicaid programs in establishing their own respective fee schedules. Many, if not all, of these noncovered services represent evidence- and/or consensus-based best practices advocated for by national professional societies (such as instrument-based ocular screening³  and topical fluoride application⁴ ). The CMS can accommodate the publication of these noncovered RVUs through an informational approach that need not imply CMS review or acceptance but rather serves as notification of RUC-recommended values for Medicare noncovered services. Short of CMS publication of RUC-recommended values for services not covered by Medicare, the RUC should consider alternative avenues of publication to support payer access to these RVUs outside the CMS MPFS.

4. Encourage full-spectrum acknowledgment of CPT codes and guidance. The CPT inventory includes a broad spectrum of coded services that are relevant to pediatric care and thus should be consistently, fully, and reliably covered by payers along with payment that reflects an appropriate minimum floor (such as the current MPFS rate). Payer adherence to the full scope of CPT coding guidance should also include recognition of CPT modifiers that reflect sound coding principles and impact pediatric payment (such as modifier 22 for increased procedural services that are unusually difficult or time consuming and modifier 63 for procedures performed on infants <4 kg). Comprehensive payer coverage is especially relevant to the codes and principles associated with team-based care, which is integral to the delivery of care for children with complex medical and social problems. Such team-based care is recognized by many of the recently developed transition and chronic care management services and include services that reflect efficient approaches to care delivery, such as interprofessional telephone and/or Internet consultation services. Technological evolution, site of service, or provider type should not limit payer acknowledgment of CPT coding principles. Physician work is typically maintained even when services are performed in various sites of care via electronic telecommunication. Thus, the digital capability to perform a wide variety of CPT-associated services via Health Insurance Portability and Accountability Act of 1996–compliant technology need not limit payment for those services reported with conventional CPT codes.

   The Health Insurance Portability and Accountability Act requires that the Department of Health and Human Services adopt standardized code sets for diagnoses and procedures used in all electronically transmitted health care transactions, such as the designation of the CPT code set in representing physician services. Because children are covered by a national patchwork of payers, including Medicaid, the Children’s Health Insurance Program, and other government and private payers, payer conformity in following CPT published guidance is essential in minimizing administrative burden and creating consistency in adjudicating claims. Following CPT coding guidance is especially important for immunization administration, a mainstay of pediatric physician practice and child health. Unilateral payer modification of CPT immunization administration guidance, which focuses on each vaccine component rather than each vaccine product, imposes inappropriate payment limits on immunization administration and fosters errors in claim submission. Additionally, variation in payer interpretation of CPT guidance can impede effective reporting of quality measures, such as through the Healthcare Effectiveness Data and Information Set.

5. Develop relevant quality measures. For newly developed alternative payment models, payers typically include quality-measure reporting to incentivize performance and the adoption of evidence-based care. Although conventional quality measures, such as those reflected by Category II CPT codes and their numerator–denominator structure, were developed for shorter-term clinical scenarios, pediatric care is unique in its focus on longer-term care of the growing and developing child within a dynamic family social fabric. The AAP recognizes the impact of social and environmental determinants of child health in pursuing its mission to attain optimal physical, intellectual, behavioral, developmental, and social health for all pediatric patients.⁵  This unique, pediatric-focused approach to monitoring outcomes over extended periods of maturation requires creative approaches to develop meaningful quality measures. Designers of pediatric quality measures should give consideration to reporting of metrics that reflect achievement of preventive and anticipatory services rendered over extended childhood time spans and focused on longer-term outcomes.

6. Optimize ICD-10-CM impact on payment. Pediatricians should use the specificity of the ICD-10-CM to accurately reflect the child’s conditions and complexity, yet payers must recognize that clinical specificity may be lacking when disease processes are evolving. When sufficient clinical information is not known or available about a particular health condition, the payer should recognize that the clinician can appropriately report an unspecified code without the claim being summarily denied solely on the basis of specificity.⁶  Furthermore, as experts in the care of children, pediatricians should be able to provide those specialist services that fall within the scope of primary pediatric care as long as appropriate ICD-10-CM specificity is reported, and payers should not use ICD-10-CM specificity to deny payment to appropriately trained pediatricians performing those specialized services within their scope of practice. Newer payment models incorporate elaborate risk-adjustment algorithms based on diagnostic completeness, such as Department of Health and Human Services and CMS risk adjustment scored by hierarchical condition categories.⁷  Models such as these that reflect patient diagnostic complexity assist in supporting resource allocation, but such risk-based models must appropriately represent the risk contributed by children with special health care needs.⁸  To effectively represent the medical and social complexity that pediatricians may confront in caring for children and in recognition of the role that diagnostic comprehensiveness plays in characterizing appropriate patient risk, claim-form formatting should be expanded (such as doubling to 8) to accommodate more than 4 diagnoses per line-item service (which is the current line-item limitation for the version 5010 CMS 837P electronic and 1500 paper claim forms; Fig 1).⁹ 

7. Recognize pediatric-specific services. Pediatric care presents unique challenges because of small patient size, evolving growth and development, communication and compliance challenges, and social complexity, including dependency on adult caregivers. The development of pediatric-specific codes and modifiers assists in accurately representing the complexity of pediatric work for certain types of pediatric services. In addition to focusing on interventional procedures that merit unique pediatric specificity to support increased complexity, nonprocedural and team-based services also warrant pediatric recognition during code development to appropriately represent the pediatrician’s navigation of complex social scenarios and interactive complexity.

We recommend the following.

1. Improve comparative Medicaid payment. Although Medicaid is jointly federally and state funded, individual state administration leads to marked variability among the nation’s various Medicaid programs. Ensuring that vulnerable pediatric populations have access to appropriate care requires that Medicaid programs pay physicians rates that are at least equal to those of Medicare. The absence of comparative payment for professional services is 1 of the greatest access barriers for children and families seeking primary and specialty care. The AAP continues to voice strong support for the Medicaid program,¹⁰  and because of its central role in supporting health care for the family and child and because access to care is essential in maintaining pediatric health, Medicaid should fully value its services consistent with RUC recommendations and MPFS minimum thresholds. Although Medicaid has a history of physician underpayment relative to other payers,¹¹  the Patient Protection and Affordable Care Act’s statewide 2013–2014 increase in primary care Medicaid payments to Medicare levels resulted in improved access to care.^12,13  Unfortunately, most states reverted back to historic low-payment norms when the parity program concluded. Figure 2 demonstrates 2016 Medicaid-to-Medicare fee ratios, and Fig 3 shows average annual per-enrollee growth in Medicaid compared with Medicare spending. A 2012 study revealed that the average ratio of Medicaid to Medicare primary care payments was 58%.¹⁴  Because the burden of disease is accentuated in pediatric populations subjected to adverse socioeconomic conditions¹⁵  and because low-income families rely on Medicaid to provide for their health care needs, Medicaid and managed Medicaid rates should at least reach parity with those of Medicare in support of access to health care. Furthermore, individual Medicaid programs should be transparent in their fee schedules, and those rates should reflect appropriate relativity among services as established by the RUC through RBRVS service valuation.

2. Develop a national Medicaid database. Achieving the Triple Aim of better patient and/or family care experience, better population health, and lower costs¹⁶  will require expanded data transparency and availability to appropriately assess health care populations.¹⁷  Effective care management requires comparative data to assist in pursuing actions and policies that support improved health.¹⁸  The AAP encourages the development of a national database of Medicaid services capable of tracking health care use using submitted claims data based on CPT and ICD-10-CM codes and payments. By providing insight into deficiencies in care and variance in care among populations, such a database would contribute health care value to patients and families who rely on Medicaid. Although extensive claims-based administrative data are currently available for Medicare beneficiaries, the difference of that population compared with pediatric patients requires the development of Medicaid-specific data sets and publication. The AAP recognizes that the CMS is currently investing in this area through its transformation of the Medicaid Statistical Information System, an evolving national database of Medicaid program use and claims data that currently includes 42 states.¹⁹  In an era of evolving payment models, the aggregation and analysis of administrative claims-based data provides insight into strategic allocation of resources that can guide policy while allowing for state-by-state comparison.

3. Expedite G-code transition to CPT. The CMS expedites code development for desired services through the introduction of temporary Healthcare Common Procedure Coding System level II G codes (a CMS-managed code set representing services, products, and supplies not otherwise addressed in CPT).²⁰  Although G codes represent standardized codes that may be used by any payer, G codes are primarily used by Medicare to address urgent coding requirements and are not readily incorporated into other payer systems (such as Medicaid) that are central to pediatric care. Relying primarily on G-code development, which bypasses the CPT process, has a unique impact on pediatric care because payers primarily focus on CPT coding when making coverage decisions. Pediatric care advances when services represented by new codes (such as behavioral management services) are expeditiously developed through the collaboration of CMS and CPT code developers followed by appropriate RUC valuation of the new CPT code. The AAP encourages the CMS to preferentially engage with the CPT code development process when introducing new services represented by G codes so that the development of CPT codes can occur expeditiously and potentially in parallel. In addition, while awaiting an expedited transition from G-coded services to CPT, the AAP encourages broad-scope payer recognition (especially by Medicaid) of Healthcare Common Procedure Coding System level II G codes so that pediatric patients and their physicians may benefit from newly introduced medical concepts.

4. Align regulatory correlation with CPT codes. Because G codes do not have widespread recognition among pediatric-relevant payers, CMS publication of regulatory guidance that focuses on G codes rather than a more universally accepted CPT code may leave a void in regulatory application. For example, in publishing its “Teaching Physician Guidance” with reference to the primary care exception that accommodates supervision of residents in a clinic setting, the CMS focuses on its annual wellness-visit G codes rather than on the parallel CPT preventive medicine codes, which are the mainstay of pediatric preventive care.²¹  Although conceptually the CPT preventive medicine visits should apply equally to the primary care exception, CMS reliance solely on the G codes fosters a lack of clarity among pediatric-relevant payers, including Medicaid as well as commercial payers. The AAP encourages the CMS and other payers to recognize the importance of inclusiveness of scope when publishing G-code guidance that also has relevance to existing parallel CPT-coded services.

AAP

American Academy of Pediatrics

CMS

Centers for Medicare and Medicaid Services

CPT

Current Procedural Terminology

ICD-10-CM

International Classification of Diseases 10th Revision Clinical Modification

MPFS

Medicare Physician Fee Schedule

RBRVS

resource-based relative value scale

RUC

American Medical Association–Specialty Society Relative Value Scale Update Committee

RVU

relative value unit

David M. Kanter, MD, MBA, FAAP

Richard Lander, MD, FAAP

Richard A. Molteni, MD, FAAP

Richard A. Molteni, MD, FAAP, Chairperson

Margie C. Andreae, MD, FAAP

Joel F. Bradley, MD, FAAP

Eileen D. Brewer, MD, FAAP

David M. Kanter, MD, FAAP

Steven E. Krug, MD, FAAP

Edward A. Liechty, MD, FAAP

Jeffrey F. Linzer Sr, MD, FACEP, FAAP

Linda D. Parsi, MD, MBA, CPEDC, FAAP

Julia M. Pillsbury, DO, FACOP, FAAP

Alexander M. Hamling, MD, FAAP – Section on Early Career Physicians

Kathleen K. Cain, MD, FAAP – Section on Administration and Practice Management

Benjamin Shain, MD, PhD – American Academy of Child and Adolescent Psychiatry

Samuel D. Smith, MD, FAAP – American Pediatric Surgical Association

Becky Dolan, MPH, CPC, CPEDC

Teri Salus, MPA, CPC

Linda J. Walsh, MAB

Richard Lander, MD, FAAP, Chairperson

Mary L. Brandt, MD, FACS, FAAP

Norman “Chip” Harbaugh Jr, MD, FAAP

Mark L. Hudak, MD, FAAP

Eugene R. Hershorin, MD, FAAP

Susan J. Kressly, MD, FAAP

Elizabeth M. Peterson, MD, FAAP

Gail A. Schonfeld, MD, FAAP

Louis A. Terranova, MHA