^MEDICARE
A Beginner's Guide to Medicare
Regardless of who handles the red tape of billing and coding in your practice, your understanding of Medicare requirements will ensure the practice is being paid appropriately.
By Suzanne L. Corcoran, C.O.E.

Starting in 1965, Congress established two social programs to cover the cost of medical care for the elderly and disabled. These programs became known as Medicare. The first program, Part A, covers hospitalization and other institutional provider care. Everyone eligible for Social Security benefits is also eligible for Part A. The second program, Part B, covers the costs of physician and other healthcare practitioner services. This is known as "regular Medicare" and isn't an entitlement program; instead, Part B requires that a premium be paid by the beneficiary.

These programs are administered by the Centers for Medicare and Medicaid Services (CMS). This article will focus on Part B since it's most associated with services provided by ophthalmologists.

Medicare doesn't cover every possible service, although its beneficiaries often seem to think so. Covered services are those deemed to be medically necessary for diagnosis, treatment or management of an illness or injury. Noncovered items and services include:

■ Services that aren't reasonable and necessary (e.g., experimental procedures), cosmetic surgery (e.g., LASIK), routine care (e.g., check-ups, refractions, most eyeglasses)

■ Services covered under other insurance plans (e.g., worker's compensation, military)

■ Services to immediate family members.

Assignment and Participation

The Medicare benefit belongs to the beneficiary, who may choose to assign these benefits to a provider. A physician who accepts assignment on a claim agrees to limit the amount of payment he or she accepts to the amount Medicare allows as defined in the Medicare Physician Fee Schedule (MPFS), which is updated annually.

Physicians also may elect annually to participate in the Medicare program. Participating physicians agree to accept assignment for all covered services. Medicare pays the physician (or group) directly, to expedite payment. Physicians who don't participate may accept assignment on a case-by-case basis and collect at the time of service. However, the allowed amount for nonparticipating physicians is reduced by 5%. In addition, Medicare limits the amount a nonparticipating physician may collect from a beneficiary to 115% of the reduced allowed amount. More than 95% of all ophthalmologists are participating physicians with the Medicare program.

Unique to Eye Care

Medicare watches practice patterns within a specialty and compares your utilization of CPT codes to that of your peers. If your utilization pattern is significantly different, it may trigger an audit. See Table 1 for national utilization patterns.

Ophthalmology and optometry are unique in that they have more than one set of codes to describe exams. All of medicine uses the Evaluation & Management (E/M) coding system — codes in the 992xx series. Only eye doctors combine a second set of codes to identify eye exams, 920xx. The correct code for a particular visit depends on the documented elements of an exam, the seriousness of the patient's condition and the extent of the history.

In Table 1, note that some codes overlap. For example, 99203 and 92004 have roughly similar values and documentation requirements. Under the MPFS, the eye code pays slightly more than the comparable E/M code, and documentation requirements are usually easier to meet. For these reasons, ophthalmologists favor eye codes two-to-one. However, eye codes don't accurately describe every exam so both sets of codes are required.

Documentation Required

Documentation of exams follows the classic SOAP note (subjective, objective, assessment and plan). The quality and quantity of the documentation determines the level of the exam. While chart forms may vary, they must include the following elements:

■ Patient's name, date of exam

■ Subjective
    – Chief complaint
    – History (current illness, medical, family, social)

■ Objective 
    – Exam

■ Assessment
    – Impression, diagnosis, progress

■ Plan
    – Orders, Rx, treatment, options, instructions, referral

■ Physician's signature.

The chief complaint is the reason for the exam, usually in the patient's own words. It dictates whether the visit is a covered service or the patient's responsibility. For example, complaints such as "routine eye exam," or "annual check-up," denote routine care and define the examination as noncovered by Medicare. "The routine physician checkup exclusion applies to exams performed without relationship to diagnosis or treatment and exams for the purpose of prescribing, fitting, or changing eyeglasses or contact lenses for refractive errors. The exclusions don't apply to physicians' services performed in conjunction with an eye disease."

Components of Eye Exam

A comprehensive eye exam includes all of the following elements, unless medically contraindicated:

■ Visual acuity
■ Confrontation fields
■ Ocular motility
■ Conjunctiva
■ External adnexa
■ Iris, pupils
■ Cornea
■ Anterior chamber
■ Lens
■ IOP
■ Fundus (disc, C/D, NFL, macula, vessels, periphery)
■ Mental status (mood, affect).

Some physicians question the necessity of their signature on the chart note, especially in solo practice. "Medicare requires a legible identity for services provided or ordered. The method used (e.g., handwritten, electronic or signature stamp) to sign an order or other medical record documentation for review purposes in determining coverage isn't a relevant factor.

However, providers using alternative signature methods should recognize there's a potential for misuse or abuse. The individual whose name is on the alternative signature method bears the responsibility for the authenticity of the information. Physicians should check with their attorneys and malpractice insurers in regard to using alternative signature methods."

This makes it clear that signatures other than original ink are accepted in the medical chart, but carry potential problems.

Diagnostic Tests

Tests may be performed by a physician or, in many cases, by a technician under a doctor's supervision. Most ophthalmic tests re-
quire general supervision, meaning the physician must document an order for the test as well as an interpretation, but doesn't need to be physically present while the test is performed. Chart documentation for tests includes:

■ Physician's order
■ Date of the test
■ Technician's initials
■ Reliability of the test
■ Test findings
■ Assessment, diagnosis
■ Impact on treatment/prognosis
■ Physician's signature.

A separate form for the interpretation is not required, although it must be clearly delineated so that it is readily identifiable. 

Surgical Procedures

As with all Medicare services, surgical procedures are covered when medically necessary. Cataract surgery is the most frequent outpatient procedure for which Medicare pays, so let's use that as an example.

The American Academy of Oph-thalmology has published Pre-ferred Practice Patterns for many services, including cataract surgery. The coverage criteria include:

■ Objective evidence of a cataract
■ Reduced Snellen visual acuity
■ Lifestyle complaints
■ Good prognosis for improvement
■ Patient's ability to safely tolerate anesthesia
■ Patient's awareness of the proposed surgery and its alternatives.

It's extremely important to document the negative impact of a cat-
aract on a patient's activities of daily living, as well as his or her desire to proceed with cataract surgery. A patient questionnaire can help support the medical necessity of the procedure.

Staying Out of Trouble

Annual payments for all of Part B are about $250 billion; ophthalmology accounts for less than 2% of that. The growth in Medicare payments for ophthalmology between 2003 and 2004 was about 5%, as is the program growth overall. Given the size of the program, we shouldn't be surprised that the government is paying close attention. The frequency of investigations for possible fraud and abuse is increasing. What can you do to protect yourself?

First, have good — and current — references, including:

■ CPT-4
■ ICD-9
■ Healthcare Common Procedure Coding System (HCPCS)
■ National Correct Coding Initiative (NCCI) edits (bundles)
■ Policies 
    – Federal and state regulations
    – Bulletins, newsletters and notices from your carrier
    – Web sites
■ Medicare fee schedules.

Medicare policies include some national policies, although there are few for ophthalmology. They're available at cms.hhs.gov. Medicare carriers also publish policies, known as local coverage determinations, available on your local Medi-care carrier's Web site.

You also should review your own records. An internal audit focuses on verifying credentials, validates medical necessity, checks for correct coding, assesses the legibility and quality of the documentation, and confirms compliance with statutes and regulations. Periodic external audits are also useful, since you don't always know what you don't know. Consider a compliance plan or quality assurance program so everyone in the practice knows how to report a perceived error and what to do when one is discovered.

Finally, remember:

■ Provide medically necessary services
■ Document services provided
■ Code from the documentation.