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New Proposed Cuts in EEG Reimbursement Imperil Epilepsy Care



A PROPOSED change in Medicare payment policy for EEG could cut office payments by about 50 percent for neurologists who bill globally in the office — both technical and professional components.

Neurology braces itself for another round of proposed Medicare coding changes — this time, EEG codes are on the chopping block.

Right on the heels of devastating nerve conduction study (NCS) cuts which crippled many neurology practices this year, the Centers for Medicare and Medicaid Services (CMS) has now released a proposed rule that would substantially reduce payments for electroencephalography (EEG) performed in the office. The proposed Medicare Physician Fee Schedule (PFS) for 2014, announced on July 8, listed 200 services — including eight EEG codes — that would be affected by a cap to reduce non-facility practice expense values so that payment does not exceed the hospital outpatient payment rate, which uses the ambulatory payment classification system. The measure cuts physician office payment by about 50 percent for physicians who bill globally in the office — both technical and professional components.

In contrast to the electromyography (EMG)/NCS cuts, the technical part of the EEG is performed exclusively by techs, explained Gregory L. Barkley, MD, clinical vice chair in the department of neurology at Henry Ford Hospital in Detroit.

“The physician reads the EEG hours after it has been completed and the patient has gone home; thus, EEGs can be done in the office while the neurologist is seeing patients in the hospital or is otherwise occupied,” he pointed out. The payment for the technical charges must cover the costs of the machine (typically about $35,000), the salary for the technician (generally a Registered Electroencephalographic Technologist), the costs of the supplies, and the overhead of the room. Many neurologists employ a part-time EEG tech who will work one or more days a week, typically doing four to six EEGs a day, said Dr. Barkley, who currently chairs the Board of Governors at Henry Ford Medical Group.


One of the biggest drops in payment will be for the most common EEG code — CPT code 95819 for EEG awake and asleep. Using the current 2013 Medicare Fee Schedule, this procedure pays $421.34 for the technical payment in an office billing globally compared with the APC payment of $172.61 for provider-based billing that is used by hospitals. The payment for the physician's interpretation is the same regardless of which way the technical payment is billed: $56.14.

“For most physician practices, not just neurologists, the technical payments for procedures have historically been adequate and served as the profit centers for the practice, underwriting the payments for patient care, which are break-even at best but are typically the loss leader in the business of running a medical office,” Dr. Barkley observed. The proposed drop in payment will put a substantial dent in the economics of running a neurology practice, he added.

Moreover, the EEG test is not always predictable. “The current rates cover a two-hour test that could easily stretch to three hours given that patients are often disabled, have seizures during the test, are sometimes uncooperative due to their altered mental status, and may need sedation or time to fall asleep in the middle of the day,” said Marc R. Nuwer, MD, PhD, department head of clinical neurophysiology at the Ronald Reagan University of California, Los Angeles Medical Center and former chair of the AAN Medical Economics and Management (MEM) Committee.

“Reimbursement to provide the EEG test now will be less than it was in the year 2000,” he continued, “yet, the costs for the technologist, equipment, and supplies continue to rise with inflation, as do the costs of office rent, staff, and other expenses of keeping the doors open.”

“If the practice has bought an EEG machine, those costs are still there, as is the office overhead. If a part-time tech is brought in, can the margin be sufficient to keep the trained tech?” Dr. Barkley asked. He said the proposed rule raises these questions, as well: Can the EEG machine be sold and the EEGs be performed at the hospital with the physician still getting the professional payment without the technical expenses? If this path is taken, how does this affect the office overhead for everything else in the practice? This might trigger a move to a smaller, less expensive office. Alternatively, is there some other revenue stream that can be generated to replace this lost revenue?


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“These are the decisions that any small business makes when the paradigm shifts. For some neurologists, this may be the last straw that triggers a decision to sell the practice and become an employed physician or even to retire,” he said.


Another aspect of the proposed rule troubles experts. Marianna V. Spanaki, MD, PhD, director of the Henry Ford Comprehensive Epilepsy Program, has served as AAN advisor to the Relative Value Scale Update Committee (RUC) for the past three years. In this role, she has presented neurology codes before the RUC committee for evaluation of professional fee and practice expenses based on surveys of the AAN membership. RUC develops resource-based recommendations to CMS after a thorough and time-consuming process, she noted. The relative value fee schedule is resource-based, she explained, with a system designed to set Medicare payments based on the costs and times it takes to perform a medical service.

“CMS decisions, like this one, undermine the resource-based process, without a transparent rationale to allow an evidence-based response from the AAN,” she said.

Several of those who had served on the RUC lamented the proposed rule that recommends cuts in practice expenses as a “precedent upon which many codes or practice expenses may be devalued by CMS despite its own prior, resource-based valuation of these same services.”

Medicare payment for office procedures, previously including EEGs, is based on the Medicare Physician Fee Schedule. Payments for the technical portion are based on the actual costs of direct and indirect overhead to perform each procedure. Medicare pays for hospital outpatient procedures, though, which are based on the ballpark costs of a group of similar procedures; since some procedures in the ambulatory payment classification group cost more, and others are less than the group rate, the hospital's average payment approximates its average costs. Medicare now proposes to adopt the hospital outpatient rate for EEG services, a rate that is not resource-based for these procedures.


While it will take time to fully realize the consequences of the proposed cuts, some fear that there may be unintended consequences. The standard response to a cut in payments for any business is to look to cut expenses, said Dr. Barkley, who serves on AAN's Coding Subcommittee of the MEM and as AAN Alternate Representative to the RUC. He predicted that neurologists will respond by either shortening the test or be placed in the difficult position of resorting to lower-cost labor.

“Both of these steps may reduce the quality of the medical information gathered,” he cautioned. “This is particularly true in EEG recordings where you are trying to find intermittent abnormal discharges, so-called ‘spikes,’ which are a marker for the risk of having epileptic seizures,” he explained. “Spikes tend to increase in sleep so shorter tests will mean that the patient will be less likely to fall asleep and thus reduce the yield of the study.” The resultant lower positive yield for support for epilepsy might lead to the underdiagnosis of epilepsy, Dr. Barkley fears.

It could also lead to overutilization, he warns, since physicians may order a second EEG (after the first negative one) if convinced that the patient actually does have epilepsy.

“This might be another routine EEG, a longer EEG recording, or more inpatient video EEG recordings requiring a three-day or longer hospitalization, at a considerable cost to CMS and an inconvenience to the patient,” he cautioned. Patients, in turn, will incur the direct costs of the copayments for additional testing as well as additional time off work to the patient and/or family member who needs to bring the patient to the studies because patients with suspected epilepsy cannot drive and need someone to transport them, he noted.

CMS is accepting comments until Sept. 6 and will publish the final rule by Nov. 1, which will go into effect on Jan. 1, 2014. In the meantime, the AAN has been refining its response, enlisting the help of its members, consultants, other professional societies, and consumer groups.

“The AAN has retained a powerful Washington, DC-based consulting group to help us take the most effective action,” said AAN President Timothy A. Pedley, MD, former chair of the department of neurology at Columbia University Medical Center. “We also immediately reached out to partner societies and patient groups to develop a united response to this proposal.”

Dr. Pedley noted that private practice neurologists are still reeling from the recent EMG/NCS cuts, adding that AAN members should start preparing for these potential EEG cuts. “They may decide they can no longer perform the tests in their office,” he said, emphasizing, “There is little margin left for those in neurology private practices.”


“This dramatic cut makes it very challenging to continue to provide private practice-based EEG labs with dedicated registered EEG techs,” said Marianna V. Spanaki, MD, PhD, MBA, director of the Henry Ford Comprehensive Epilepsy Program. Fewer practices will be able to provide the service which will, in turn, compromise access to care of epilepsy patients, she added,

“‘Care within reach’ is of paramount importance to epilepsy patients who frequently do not drive and are dependent on family members and caregivers for transportation to medical appointments,” Dr. Spanaki pointed out. “In addition, continuity of care will suffer since the patients will receive care by their neurologist in one location and will be referred elsewhere for testing (EEG).”

“The proposed cut targets a vulnerable population with many limitations, but access to care should not be one of them,” said Dr. Spanaki. Since epilepsy is, more often than not, a life-long disease, epilepsy patients require and deserve ongoing care, medication adjustments, and repeat EEGs to provide optimal management,” she explained. “Many of those patients receive ‘one stop care’ for years by their neurologist and this care includes both clinical care and EEG testing by the same provider.” Neurologists and their patients may become aware that access to testing may become limited, but it is very difficult to develop objective evidence of restricted access to care. Without objective evidence of worsened medical outcomes, CMS has no incentive to increase payments for these services in future years.

Neurologists are also concerned about the deterioration in quality since practices that no longer find it possible to hire EEG techs will send their patients to local community hospitals which, rather than provide a qualified registered EEG technician, use techs who are expected to perform myriad procedures.

“It's common, rather than not, for community hospitals to have techs who are cross-trained to perform different procedures including EEGs, EKG, sleep-related procedures, and transcranial Doppler studies,” explained Dr. Spanaki. Experts also worry that community hospitals are increasingly outsourcing EEG to mobile labs. They generally don't have the resources to cross-train technologists who perform multiple services and EEG is too specialized to perform well without specific training, they argue.

Orly Avitzur, MD


•. Medicare Physician Fee Schedule 2014:
    •. Neurology Today archive on reimbursement cuts/”Death by a Thousand Cuts” series:
      •. AAN resources on public policy:
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