Composite APCs for Imaging Services

Outpatient Medicare payment for most hospitals is governed by the Outpatient Prospective Payment System (OPPS). The OPPS contains Ambulatory Payment Categories (APCs) that are assigned Status Indicators determining how they are paid. In turn, each procedure code is assigned an APC, except for procedures that are unconditionally bundled. Unconditionally bundled procedures are those that have been determined to always be performed subsequently and in support of another procedure. They are never reimbursed separately and are assigned Status Indicator N.

There is a second classification of bundled procedures designated as conditionally bundled. If certain conditions occur, the procedure is bundled and not reimbursed separately. There are three types of conditionally bundled procedures. In this article we talk about one specific type: Composite APCs in the 2009 calendar year for the technical component of imaging services provided at the hospital setting.

In its effort to promote efficiencies in hospitals and to move closer to an “episode of care” payment system, the Centers for Medicare and Medicaid Services (CMS) is bundling payment for multiple imaging procedures performed with the same modality beginning in 2009. The imaging services affected are ultrasound, computed tomography, and magnetic resonance imaging.

The bundling is being accomplished through a Composite APC. A Composite APC pays a fixed amount when certain procedures are performed together. Within imaging, a single payment will be made when two or more imaging procedures are performed using the same modality. The term “Family” is used by CMS to define the procedures subject to bundling. Each Family is treated individually for bundling. The bundling does not cross Families.

The composite APC payment methodology is identified and controlled by the assignment of Status Indicator Q3 to the procedures included. Status Indicator Q3 triggers the Outpatient Code Editor (OCE) to screen for other procedures performed in the same Family before assigning payment. If only one procedure in a Family is found, the OCE converts the Status Indicator of that procedure to a secondary Status Indicator and makes payment at the secondary APC payment amount. If the OCE finds one or more additional procedures from the same Family, a Composite APC is paid for all procedures performed in that Family.

The Family for ultrasound procedures includes only 10 procedures (76604, 76700–76776, and 76831-76870). The CT and MRI Families include all Medicare-covered CT and MRI procedures with the exception of guidance procedures (which are unconditionally bundled with the intervention performed); CT limited or follow-up study (76380); and functional MRI procedures (70555–70559). In CT and MRI, there are Composite APCs for noncontrast and contrast studies. If both noncontrast and with-contrast procedures are performed in a Family, the with-contrast Composite APC is paid.

In the examples above, the national Medicare payment amount in 2008 is compared to 2009 for the same services. Composite payment is based on service date. All procedures on the same date of service are included, even if performed at different sessions.

In 2009, when two procedures from one Family are performed on a Medicare outpatient, the effect on hospital technical payment is minimal and, in most instances, is higher than the payment received for the same two procedures in 2008. It is when more than two procedures are performed that a significant loss of reimbursement occurs. The frequency of this happening at your facility is important to know when projecting your financial impact in 2009. As physician payment is not impacted by these new guidelines, discussing these changes with the interpreting physicians and educating referring physicians should be a priority in 2009.

David Zielske, MD, CPC-H, CIRCC, CCS, RCC, is a member of the American Academy of Professional Coders’ National Advisory Board and the founder of Z Health, a physician-based coding and auditing firm, and Z Health publishing, an educational company. Dr Zielske retired from active interventional radiology in 2003, after practicing privately for 14 years in a community setting at several 200-bed hospitals in the Nashville, Tenn, area. The American Academy of Professional Coders (AAPC, www.aapc.com) is the nation’s largest educational and credentialing association for medical coders, and among its available credentials, it offers the Certified Interventional Radiology Cardiovascular Coder (CIRCC™) credential, the first certification of its kind available to individuals in the interventional radiology and cardiovascular subspecialties.