Understanding Episodes of Care

The Commission on Economics is working to define radiology’s place in episode groups.july bulletin episodes of care

What role does radiology play in clincal care? This is a wide-open question with multiple potential answers.

One way CMS hopes to answer this question is through episode groups, which are episodes of care based on specific conditions, such as heart failure, or procedures, such as hip replacement.1 The Affordable Care Act (ACA) and the Medicare Access and CHIP Reauthorization Act (MACRA) require that CMS establish episode groups to measure resource use. Resource use (recently renamed “cost” under MACRA) is one of the performance categories in the Merit-Based Incentive Payment System, which will be used to adjust physician payments starting in 2019. 


Defining Resource Use

Resource use is defined as the costs incurred during care, sometimes referred to as per-capita costs. CMS already measures resource use to adjust payments to group practices through the ACA-mandated Value-Based Payment Modifier. Going forward, CMS will evaluate resource use differently by studying specific episodes of care, which include separate but related services provided over a defined period of time. This allows CMS to evaluate similar populations of patients, compare different patterns of care, assess coordination, and reflect patients’ views of care. When combined with quality metrics, resource use may define more efficient ways to deliver care.

Dividing Into Episode Groups

Episode groups are based on specific clinical care or procedure-related care. For example, the care provided during a hospital admission for hip replacement surgery or stroke care. To inform the effort, CMS is using episode groupers, which are software applications that analyze Medicare administrative claims data to determine which clinically related services should be included in a specific episode of care. Since the episode groups are based on medical claims data, the groups focus on existing procedural (CPT) and diagnosis (ICD) codes. For example, “trigger codes” open the episode and “relevant services” are provided for the management, diagnosis, treatment, and evaluation of the medical condition.

Recently, CMS made public a number of episode groups providing a glimpse into its structure and indicating where radiology is included. For example, the hip replacement episode group has a “look back” period of 30 days and a “closing rule” of 90 days, so all services provided during that time frame are included in the episode group. Trigger codes are diagnoses that define the episode, such as the ICD code for total hip replacement. Relevant services include the surgical CPT code for total hip arthroplasty and several radiology services, such as a hip X-ray and lower extremity CT. The episodes include “sequelae” codes for clinically plausible sequelae, such as postoperative infections or deep venous thrombosis.

Adding Value for Radiologists

Episodes of care provide an opportunity for radiology to define how our resource use will be determined. We cannot assume that we will be excluded from resource use simply because diagnostic radiology is largely a referral-based specialty. In fact, MACRA requires that CMS develop patient-relationship codes to capture different physician–patient relationships for the purpose of distinguishing the responsibility of a physician at the time of furnishing a service. These codes will be appended to claims starting in 2018, and one of the proposed categories is “furnishes items and services only as ordered by another physician,” a category that could include diagnostic radiologists. For interventional radiology, the opportunities to show impact are even greater, given the direct role they play in patient care.

Looking Forward

The Commission on Economics, in collaboration with the Commission on Quality and Safety, submitted comments to CMS on this topic. We engaged a number of clinical experts to study each individual group and comment on radiology’s place in the episodes. At a general level, we highlighted the role radiology plays in efficiency and quality through such initiatives as Imaging 3.0™ and clinical decision support. At a more granular level, again using hip replacement as an example, we commented that inpatient and outpatient populations have different clinical needs and clinical presentations such that imaging utilization could vary. We recommended additional CPT codes for consideration. The structure of episode groups will continue to evolve as new regulations and proposed rules are released by CMS before affecting physician payments in 2019. The Commission on Economics stands ready to inform these discussions and advocate for the important role of radiology in resource use.

SilvaBy Ezequiel Silva III, MD, FACR, Chair


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