Proposed 2023 Changes to CMS Inpatient E&M Reimbursement

Learning Objectives: Educate IR departments on the financial impact of proposed 2023 CMS inpatient E&M reimbursement changes.

Background:

Financial viability in the inpatient environment is imperative for continued growth of IR as an independent clinical specialty. It is paramount that physicians maintain an understanding and awareness of CMS inpatient encounter reimbursement changes. Evaluation & Management (E&M) codes – which categorize inpatient encounters as ‘Initial hospital care’ (CPT 99221-99223, Levels 1-3), ‘Subsequent hospital care’ (CPT 99231-99233, Levels 1-3), ‘Osberv/hosp same date’ (CPT 99234-99236, Levels 1-3), and ‘Hospital discharge day’ (CPT 99238-99239, Levels 1-2) – represent increasing complexity of care with correspondingly increased Relative Value Units (RVUs). Significant changes to these reimbursement values are proposed for 2023 in conjunction with a proposed decrease of the conversion factor by $1.53.

Clinical Findings/Procedure Details:

The 2023 Medicare Physician Fee Schedule Proposed Rule includes both increases and decreases in work RVU values for inpatient E&M services most commonly used in IR. To analyze the financial impact of these changes, we have compared the 2023 proposed reimbursement for each individual level as they compare to previous years dating back to 2021.

Conclusion and/or Teaching Points:

The proposed 2023 changes to E&M CPT coding have resulted in both increases and decreases in reimbursement for the most commonly used codes in IR.  There is an overall decrease in reimbursement for initial hospital care (CPT 99221-99223, Levels 1-3), and observation (CPT 99234-99236, Levels 1-3), across all levels of billing. An increase in reimbursement is demonstrated for subsequent hospital care (CPT 99231-99233, Levels 1-3), and hospital discharge day (CPT 99238-99239, Levels 1-2), across all billing levels. These changes must be monitored closely to establish financial viability in the inpatient environment.