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The Brody School of Medicine Office of Compliance
Compliance Wise-Fall 2007


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Consultation or New Patient Visit: What’s the Difference (and Why You Should Care)

When a  provider “refers” a patient to you, do you treat this patient as a “new patient visit” or a “consultation” for billing purposes? From a provider’s perspective, you may think that you provide consult services for every patient “referral;” however, for billing purposes, the Center for Medicare and Medicaid Services (CMS) and CPT coding guidelines have specific criteria for when a visit should be billed as a consultation or a new patient visit. Failure to bill in the correct manner could lead to problems with claim denials, potential overpayment situations or even allegations of fraud.

According to CMS and CPT coding guidelines, a “consultation” is the rendering of advice or a professional opinion, followed by a report of findings to the referring physician. A consultation visit results in the patient returning to the physician who initiated the care, even though the consulting physician may initiate diagnostic and/or therapeutic services during the visit.

In order to support the billing of a consultation, there must be (i) a written request for a consultation which includes the need for such consultation; (ii) documentation of a history, exam, and medical decision making which supports the level of consult that is billed; and (iii) a written report prepared by the consulting physician and provided to the referring physician which consists of findings, recommendations for treatment, and any therapeutic interventions that have been planned or have been initiated by the consulting physician.

On the other hand, a patient referral should be billed as a “new patient” or “established patient” when a complete transfer of care for that portion of the patient's condition is expected or intended on the part of the referring physician. A “new patient” is defined as one who has not received any professional services from the physician or another physician of the same specialty who belongs to the same group practice within the past three years. An “established patient” is a patient that falls outside of the definition of “new patient” (and is not a consult).

While the differences between the types of visits may seem insignificant from a clinical perspective, the differences are substantial from a billing perspective. In general, providers are paid substantially more for a consultation than a new patient visit. Thus, underbilling valid consult visits results in a loss of hard-earned revenue for your practice, while overbilling results in potential claim denials, potential overpayment situations, and potential allegations of fraud.  In March 2006, the Office of Inspector General (OIG) released its final report of its audit of 400 randomly selected patient visits billed as consultations. The OIG determined that in 2001, Medicare allowed approximately $1.1 billion more in payments for services billed as consultations than it should have. They further found that 75% of all consultation billings resulted in improper payments. This included 19% of billed consults that did not meet Medicare’s definition of a consult, 45% that were billed at the wrong level, 2% that were billed as the wrong type, and 9% that contained no documentation. Overall, 41% of consults were, in OIG’s opinion, up-coded and 5% were under-coded. As a result of this OIG report, local CMS carriers (including the CIGNA Government Services, the carrier for North Carolina) have placed heavy emphasis on the auditing of consultation services.

While recognizing the differences between a consultation and a new or established patient visit for billing purposes may seem insignificant or tedious, it is very important to correctly bill for these types of services. Correct billing results not only in potential revenue enhancement, but also helps to avoid potential penalties related to any CMS or commercial payor audit.

Examples of clinical situations that may or may not be a consult:

Example 1 (Consult):

An internist sees a patient that he has followed for 20 years for mild hypertension and diabetes mellitus.  He identifies a questionable skin lesion and asks a dermatologist to evaluate the lesion.  The dermatologist examines the patient and decides the lesion is probably malignant and needs to be removed.  He removes the lesion which is determined to be an early melanoma.  The dermatologist dictates and forwards a report to the internist regarding his evaluation and treatment of the patient.  This visit should be billed as a consultation.  This example demonstrates a primary physician requesting an evaluation of the skin lesion by the dermatologist.  Here the dermatologist provides the consultation and initiates diagnostic/therapeutic treatment by removing the lesion.

Example 2 (Consult):

A rural family practice physician examines a patient who has been under his care for 20 years and diagnoses a new onset of atrial fibrillation.  The family practitioner sends the patient to a cardiologist at an urban cardiology center for advice on his care and management.  The cardiologist examines the patient, suggests a cardiac catheterization and other diagnostic tests which he schedules and then sends a written report to the requesting physician.  This visit should be billed as a consultation.  The cardiologist subsequently sees the patient once a year as follow-up.  Any subsequent visit provided by the cardiologist should be billed as an established patient visit in the office or other outpatient setting, as appropriate.

Example 3 (Not a Consult):

A patient is admitted to the hospital by an orthopedic surgeon for total hip replacement.  The orthopedic surgeon requests that the hospitalist physician follow the patient during the hospital stay to manage the patient's medical condition.  This does not represent a consult because the orthopedic surgeon is not requesting an opinion or advice for the management in the care of the patient.

Consult Facts

Medicare payments for consultations:

Outpatient

 Inpatient

99241: $ 45.89  99251: $ 44.39
99242: $ 84.93  99252: $ 70.78
99243: $116.42  99253: $105.10
99244: $171.89  99254: $151.62
99245: $213.15  99255: $188.60

Medicare payments for  new or initial patient visits:

Outpatient (New Patient Visit)

 Inpatient (Initial Patient Visit)

99201: $ 33.70  99221: $ 82.49
99202: $ 59.09  99222: $115.41
99203: $ 87.49   99223: $168.64
99204: $133.73  N/A
99205: $168.10  N/A