The economics of gynecologic surgery: 13 coding tips to ensure fair payment

Risk stratification is being performed according to algorithms in the payers’ software—and payers are unlikely to share the details with us. However, the only real data payers have to run through these algorithms come from diagnosis coding. Even though you’re not required to code for variables such as obesity and diabetes in order to get paid for what you do, you do need to use those additional codes to make risk stratification possible—so that you don’t get inappropriately placed into a group of low-risk providers when you are treating a higher-risk cohort.

5. Develop an understanding of RVUs
Another variable that changes regularly is relative value units (RVUs) under Medicare rules. ACOG’s Committee on Health Economics and Coding—which enjoys the participation of AAGL, the American Urogynecologic Society (AUGS), the Society of Gynecologic Surgeons (SGS), and the Society of Gynecologic Oncology (SGO), as well as other organizations—tries to maintain the RVUs as up to date and appropriate as possible relative to other services in the fee schedule.

For example, about 10 years ago many urogynecologic procedures were getting bundled together when they were performed at the same time. We had only one or two ICD-9 codes to describe prolapse, with no separate codes to describe whether it affected the anterior, apical, or posterior compartment, even though we performed different procedures in the individual compartments. Payers were mapping all prolapse procedures to the same diagnosis code. So ACOG went to the National Center for Health Statistics, where ICD-9 coding was done—and developed a series of about 10 codes to describe the different areas that prolapse could affect.

That kind of nuanced coding is continuing today. In fact, we have a long list of areas to go forward with now that ICD-10 is scheduled to take effect. A good example involves new Pap smear guidelines, which recommend testing every 3 or 5 years except for patients who have undergone hysterectomy for benign disease. How do you code for a patient who has had a hysterectomy? There was no code for a woman with an absent cervix, so we created a “V-code,” a code classification for factors that influence health status, so that it is possible to explain why a Pap smear was not performed.

As we go forward into a value-based system, specialists like us likely will be negotiating contracts according to RVU-based payments. That’s why it’s important for you to understand the resource-based relative value scale (RBRVS). It has three components: a work component, which makes up about 52% of the total RVUs; a practice expense, which makes up more than 45% of total RVUS; and, finally, a malpractice component, a small percentage. There also is a geographic adjustment and a uniform conversion factor.

When you hear about the sustainable growth rate (SGR) fix, and the fact that we’re going to see a 20% or 24% reduction in payment, that talk is referring to a reduction in the conversion factor. Each component of the RVU is adjusted for geography and then multiplied by the dollar conversion factor to calculate the total RVUs. The work, practice, and malpractice components vary by where the service is provided.

Let’s use placement of Essure inserts as an example. If you perform the procedure in the hospital, then the hospital buys the equipment, including the hysteroscope and light source. The hospital also pays for the room and staff and manages equipment sterilization. If, on the other hand, you perform the procedure in your office, all those responsibilities are yours. If it’s done in your office, you get paid more but it also costs you more.

The Relative Value Update Committee, or RUC, plays a major role in determining RVUs. This committee is composed of 31 clinicians, including nonphysician providers, psychologists, and nurses who deliver services under the Medicare fee schedule. The RUC makes recommendations to the Centers for Medicare and Medicaid Services (CMS), but it is the Secretary of Health and Human Services who determines the final rule on RVUs.

Approximately 75% to 95% of the recommendations of the RUC are accepted by the Secretary and become law. So it’s not the RUC or the American Medical Association (AMA) that determines RVUs; in the long run, it is CMS and the Secretary of Health and Human Services. We are fortunate that, when CMS assigns RVUs we’re not happy with, we have an opportunity to appeal.

Under Medicare, all physician payments are based on the same conversion factor, regardless of specialty. That’s not necessarily true for other payers, who may, essentially, do whatever they wish. These other payers frequently will contract at higher or lower rates, depending on how prevalent a specialist is in the community. Sometimes they use a higher conversion factor for surgical specialists than they use for primary care.