Use safe harbors to keep straight with the Feds

Consultants advise that simple alternatives exist in the comanagement debate.

Issue: August 15, 2000

BOSTON — During the past 2 years, several publications have given rise to a fresh debate about comanagement. Legal, medical and economic issues are involved. Ophthalmologists and optometrists are concerned, given the prevalence of postoperative comanagement of cataract surgery. The government is concerned about possible abusive referral arrangements and violations of the federal anti-kickback statute.

During 1998 and 1999, a few Medicare carriers published bulletins with specific coverage policies on postoperative comanagement. These bulletins described limited circumstances that merit this approach and are, therefore, covered by Medicare. While these local policies do not extend to all parts of the country, they represent an important indication of shifting sentiment at Medicare, as well as a likely harbinger of future changes in other venues. Interestingly, early this year, the American Academy of Ophthalmology and the American Society of Cataract and Refractive Surgery issued a joint policy statement that states that postoperative comanagement should be “an exceptional rather than a routine occurrence” and incorporates much of the same language contained in the Medicare bulletins.

In November 1999, Medicare published in the Federal Register a new safe harbor concerning referral arrangements. Of particular interest was the revision to preclude protection for arrangements that share or split a payment from a federal health care program for the referred patient. This exclusion does not make comanagement illegal, but it does make it risky.

According to consultant Kevin J. Corcoran, COE, CPC, of San Bernardino, Calif., in 1998, Medicare paid for 1.5 million cataract surgeries under fee for service of which 189,000 were comanaged by optometrists (13%) and 109,000 were comanaged by ophthalmologists (7%).

When comanagement is not handled properly, the potential risks include: third party payer scrutiny; post-payment audits; legal proceedings; hearings by the licensing board; malpractice allegations; ethical challenges; and adverse publicity. While the rules are clear enough, there is a risk that a breakdown may occur. What if documentation in the medical record is poor or missing? What if there is poor communication between the ophthalmologist and the optometrist? What if the patient is lost to follow-up?

Since the penalties involved can be enormous, some ophthalmologists and optometrists ask, “Is it worth it to comanage postop care?” Maybe not.

Mr. Corcoran suggested the most important aspect of the relationship between an ophthalmologist and an optometrist is aptly expressed in the new safe harbor: “I’ll send you my patients who need your specialist services if you agree to send them back to me upon completion of your services.” If we no longer comanage, this safe harbor covers both parties who cross-refer for the welfare of the patient and the legal jeopardy is diminished.

In the absence of comanagement, several Medicare regulations support reimbursement for an exam performed by the optometrist in the postop period, or lend credence to an appeal of a denied claim, or make the beneficiary financially responsible. Yet a pragmatic office manager might wonder about the economics involved. As Medicare reimbursement for cataract surgery has declined over the past decade, the value of the postoperative component has likewise diminished. Alternatively, the value of an eye exam has steadily increased. The regulatory burden of complying with Medicare’s instructions also has increased, particularly the cost associated with correspondence between the surgeon and the receiving doctor. The economic disparity between these two alternatives has diminished.

Table 1 contains an illustration of the small difference between these two approaches based on the 2000 national Medicare fee schedule, the estimated average charge for a refraction, and estimated cost of correspondence to the optometrist (that is, postop care request form, acknowledgement of surgeon’s transfer). Clearly, results will vary if the assumptions are changed, yet it remains clear that the disparity is not as large as it once was. For instance, the value of a comprehensive eye exam (92014) is $77 instead of $53 for an intermediate exam (92012).

It is noteworthy that the value of the post-cataract glasses is not considered in Table 1 since, presumably, this amount is unchanged by the decision to comanage or not.

The optometrist will probably choose V43.1 (pseudophakia) as the corresponding ICD-9 code on the claim for the exam and 367.4 (presbyopia) for the refraction. If other chronic diseases also are present, then other diagnoses may be warranted. No special modifiers (for example, –24, –55, –79) are required.

Finally, the essence of the safe harbor is satisfied and, since comanagement is no longer an issue to nullify the safe harbor, the threat of criminal or civil prosecution is reduced.

Flare-ups

However, recent events have caused the comanagement debate to flare up again, said Michael A. Romansky, of the Washington office of the law firm McDermott Will & Emery. The American Academy of Ophthalmology and the American Society of Cataract and Refractive Surgery (ASCRS) issued a strict comanagement guideline, and other ophthalmic societies have responded (“Comanagement cold war flares,” Ocular Surgery News, May 15, 2000 issue, page 1].

Also, a few Medicare carriers have more strictly defined existing Medicare policies. The carriers tend to copy one another’s regulations, so the comanagement atmosphere may be becoming more rigorous.

To help surgeons function in this environment, the Outpatient Ophthalmic Surgical Society discussed comanagement procedures as part of its annual meeting held in conjunction with the ASCRS meeting.

Surgeons who choose to comanage still must define how they will practice in order to avoid incurring problems, Mr. Romansky said.

“Notwithstanding some of the scary rhetoric, appropriate comanagement of Medicare patients is kosher,” Mr. Romansky said. “Use the modifiers. Don’t enter into an explicit agreement with an optometrist that you will comanage all patients. Comanagement should be conducted based upon the clinical conditions of a given patient.”

Written agreements should only define clinical protocols for when comanagement is appropriate for a patient to be comanaged. Such agreements can define the number, timing and scope of visits. They also should clarify when comanaging optometrists or ophthalmologists contact the surgeon and when to send medical records.

“The best programs that I have seen are ones in which medical records are coordinated,” Mr. Romansky said. “Reports go back from the OD to the MD all of the time.”

Refractive surgery

Medicare rules state that the amount paid to each provider must reflect the appropriate proportionate value and intensity of the services provided.

Medicare’s benchmark created a benchmark of 20% for the optometrist and 80% for the surgeon, which is an appropriate comanagement fee for refractive surgery.

“When you start getting above that 20% amount, I can just say that the higher that you go, the greater the risk that the payment looks like a kickback,” Mr. Romansky said.

He advises physicians to have patients make separate payments to the surgeon, optometrist and the surgical facility. If that seems unappealing, then at least break down the costs on a single bill.

Other precautions can help surgeons avoid problems during comanagement.

Of paramount importance in any comanagement situation is that it is the patient who is choosing who will be providing postoperative care. Surgeons should allow patients to become part of the decision-making process, Mr. Romansky said. They can discuss with patients postoperative requirements, as well as which eye care providers are capable of performing these components.

The patient has the option of returning to the operating surgeon at any time, so the patient should sign a detailed statement that explains the discussion and that the patient has elected to have postoperative care by the optometrist.

Table 1: economic analysis of comanagement
Comanage	Fees	Don’t comanage	Fees
66984-55 (80 days)	$13	Exam (92012)	$53
Refraction	Included	Refraction (92015)	$20
Less cost of correspondence	<$10	No correspondence	$0
Total	$123	Total	$73

For Your Information:

Kevin J. Corcoran can be reached at the Corcoran Consulting Group, 1845 Business Center Drive, Ste. 108, San Bernardino, CA 92408; (800) 399-6565; fax: (909) 890-1333.

Michael A. Romansky can be reached at McDermott Will & Emery, 600 13th St. NW, Washington, DC 20005-3096; (202) 756-8069; fax: (202) 756-8087.