Jane M. Orient, M.D.
Executive Director
Association of American Physicians and Surgeons, Inc.
1601 North Tucson Blvd., Suite 9
Tucson, Arizona 85716-3450

Dear Dr. Orient:

Thank you for your letter expressing concerns about the Evaluation and Management (E/M) Documentation Guidelines for E/M services. It is my understanding that you attended a meeting with the American Medical Association (AMA) and the medical specialty societies in Chicago on April 27, in which Health Care Financing Administration (HCFA) officials discussed many of the concerns you raise in your letter.

The development of the E/M Documentation Guidelines has involved much work and effort from the physician community since the early 1990s. The national medical specialty societies, through the AMA CPT Advisory Committee, were actively involved in reviewing drafts, providing extensive, specific comments, and participating in pilot testing and focus group discussions of the E/M Documentation Guidelines. HCFA distributed the E/M Documentation Guidelines in November, 1994 to Medicare Part B contractors who began the educational process. The AMA and medical specialty societies also provided educational opportunities within the physician community. The educational period extended through August, 1995 to facilitate familiarization of all physicians with the appropriate use of the guidelines when providing physician services. Education for the 1997 version of the Documentation Guidelines was conducted primarily by the individual medical specialty societies since the major revision to the 1997 version involved the inclusion of 10 single organ system examinations.

As stewards of the Medicare program, HCFA must be sure the payments we make on behalf of our beneficiaries are for medically necessary and appropriate services and that the services have been accurately reported. Our fiscal year 1997 Chief Financial Officer (CFO) Audit, which was released April 24, indicates that, while we are making progress in reducing inappropriate payments, we still have much work to do, particularly in the area of ensuring documentation for physician claims is adequate. Inadequate or no documentation is the principal cause of the improper payments identified in the CFO audit report.

HCFA needs to be confident that Medicare carriers are reviewing medical records in a consistent manner. Physicians need assurances that they are billing appropriately and have adequate documentation in the event of an audit. A workable version of the Documentation Guidelines is an essential tool for both physicians and our carriers. Further, improving program integrity serves the interest of Medicare, its beneficiaries, and its providers, including physicians.

We have heard from physician groups such as yours that physicians believe the 1997 Documentation Guidelines that the AMA and HCFA developed together are too complex and burdensome. The most troubling concern is that some physicians believe the new Documentation Guidelines will divert too much physician time and attention from patient care to paperwork. I believe we can and must work together to improve the Guidelines so they do not impose requirements in excess of those associated with clinically appropriate medical record-keeping practices.

In December 1997, HCFA agreed to the AMA's request that carriers use both the 1994/95 and 1997 versions of the Documentation Guidelines to evaluate claims until July 1, 1998. When we set that July 1 date, neither the AMA nor HCFA fully understood the magnitude of the problems with the 1997 Documentation Guidelines.

Therefore, I have directed our carriers to continue to use both the 1994/95 and 1997 Guidelines, whichever are more advantageous to the physician, until the revisions have been completed and there has been an adequate period of time for testing and education. Since there is still uncertainty about how quickly the work can be accomplished, it is premature to set an implementation date now. HCFA staff will report to me in the early Fall on the status of the revision efforts and the projected schedule for testing, refinement, and physician education. I anticipate using the information to set a final date for implementation of the revised Guidelines that will allow ample time to complete the pre-implementation activities.

We believe the final product will be strengthened by broad physician participation in the revision process. Your organization is encouraged to submit your specific recommendations and suggestions to HCFA as we continue to refine the Guidelines. In addition, we expect to provide a draft to the physician community prior to pilot testing and implementation. Working together, we can make the Guidelines easier to understand, and we can sharpen the focus so that the only documentation required is that which is directly related to the care provided.

We have heard the criticism that the revised E/M Documentation Guidelines could change the way physicians practice medicine. Certainly, this is not our intent. We are committed to working with the physician community to develop improvements. Please be assured I am giving this issue my personal attention and priority.

Thank you again for bringing your concerns to my attention.


Nancy-Ann Min DeParle Administrator