HCFA Final Instructions -- Teaching Institutions

15016. SUPERVISING PHYSICIANS IN TEACHING SETTINGS

A. Definitions -- For purposes of this section, the following definitions apply:

Resident means an individual who participants in an approved graduate
medical education (GME) program or a physician who is not in an approved
GME program but who is authorized to practice only in a hospital
setting. The term includes interns and fellows in GME programs
recognized as approved for purposes of direct GME payments made by the
fiscal intermediary.

The fact that an individual hospital does not choose to include an
eligible individual in its full-time equivalency count of residents does
not change that individual's status as a resident in an approved GME
program.

A medical student is never considered to be a resident. Any contribution
of a medical student to the performance of a service or procedure
billable to you must be performed in the physical presence of a
physician or jointly with a resident in a service meeting the
requirements set forth below for teaching physician billing.

Teaching Physician means a physician (other than another resident) who
involves residents in the care of his or her patients.

Direct Medical and Surgical Services means services to individual
beneficiaries that are either personally furnished by a physician or
furnished by a resident under the supervision of a physician in a
teaching hospital making the reasonable cost election for physician
services furnished in teaching hospitals. All payments for such services
are made by the fiscal intermediary for the hospital.

Teaching Hospital means a hospital engaged in an approved GME residency
program in medicine, osteopathy, dentistry, or podiatry.

Teaching Setting means any provider, hospital-based provider, or
nonprovider setting in which Medicare payment for the services of
residents is made by the fiscal intermediary under the direct graduate
medical education payment methodology or freestanding SNF or HHA in
which such payments are made on a reasonable cost basis.

B. General -- Pay for physician services furnished in teaching settings
under the physician fee schedule only if --

The services are personally furnished by a physician who is not a
resident; or

The services are furnished jointly by a teaching physician and resident
or by a resident in the presence of a teaching physician with certain
exceptions as provided below.

In both situations, the services of the resident are payable through
either the direct GME payment or reasonable cost payments made by the
fiscal intermediary.

C. Special Situations -- If a resident participates in a service
furnished in a teaching setting, pay for the services of a teaching
physician under the physician fee schedule only if the teaching
physician is present during the key portion of the service for which
payment is sought.

1.Evaluation and Management (E/M) Services -- For a given encounter, the
selection of the appropriate level of E/M service should be based on
"Documentation Guidelines for Evaluation and Management Services"
developed by the American Medical Association (AMA) and HCFA and
published by the AMA. If a teaching physician documents his or her
presence and participation in the E/M service, the level of service may
be selected based on the extent of history and/or examination and/or the
complexity of the medical decision making required by the patient and
documented in his or her personal entry in the medical record which may
include references to notes entered by the resident.

Except as indicated in subsection 2, the teaching physician must be
physically present during the portion of the service that determines the
level of service billed. In all cases, the teaching physician must
personally document his/her presence and participation in the services
in the medical records. This documentation by the teaching physician may
either be in writing or via a dictated note, and expressed in the
following ways for these major categories of E/M service:

a. Initial Hospital Care, Emergency Department Visits, Office Visits-New
Patients, Office Consultations, Hospital Consultations -- A personal
notation must be entered by the teaching physician documenting his or
her participation in the 3 key components of these services (i.e.,
history, examination, and medical decision making) as required by CPT
and demonstrating the appropriate level of service required by the
patient. If the teaching physician is repeating key elements of the
service components obtained previously and documented by the resident,
e.g., the patient's complete history and physical examination, the
teaching physician need not repeat the documentation of these components
in detail. Rather, the documentation of the teaching physician may be
brief, summary comments that tie into the resident's entry and which
confirm or revise the key elements defined for the purpose of this
section as:

relevant history of present illness and prior diagnostic tests;

major finding(s) of the physical examination;

assessment, clinical impression or diagnosis; and

plan of care

Therefore, the documentation of the key elements above may be satisfied
by the combination of entries into the medical record made by the
resident and the teaching physician. The documentation requirements for
some common clinical situations for teaching physicians are illustrated
below:

Illustration 1 - All required elements are obtained personally by the
teaching physician without a resident present. In this situation, a
resident may or may not have performed an independent service.

If no resident has seen the patient, the physician should document on
the same basis he or she would document an E/M service in a nonteaching
setting.

If a teaching physician's service follows a resident's service, then the
teaching physician's documentation should refer to the resident's note
and provide summary comments that establish, revise, or confirm the
resident's findings and the appropriate level of service required by the
patient. For example, the teaching physician would not have to restate
the review of systems and family social history in the case of an
initial hospital service. However, the teaching physician would have to
examine and question the beneficiary to verify the key findings of the
resident's notes since he or she was not present during the resident's
interaction with the beneficiary.

Illustration 2 - All required elements are obtained by the resident in
the presence of, or jointly with, the teaching physician and documented
by the resident. In this situation, the resident's note may document the
teaching physician's direct observation, performance, and personal input
into the key elements. The teaching physician's personal documentation
may be limited; at a minimum, it must include a confirmation of each
component of the resident's documentation and the teaching physician's
presence during the service required by the patient.

Illustration 3 - Selected required elements of the service, for example,
history and physical examination are obtained by the resident
independently. The teaching physician repeats the key elements of the
examination. These elements are discussed with the teaching physician
either prior to or after the teaching physician's personal service. In
this situation, the resident's note may document the teaching
physician's input into the history and medical decision-making. The
teaching physician's note must include summary comments that revise or
confirm the findings of the resident's physical examination and
discussion of the history and medical decision-making. The combined
entries must be adequate to substantiate the level of service required
by the patient and billed.

b. Subsequent Hospital Care, Office Visits-Established Patient -- A
personal notation by the teaching physician must be entered highlighting
2 of the 3 key components of these services (i.e., history, physical
examination, and medical decision-making). The same guidelines set forth
in a. are required for follow-up visits for established patients.

For E/M codes that are selected on the basis of time, see subsection 7
below.

2. Exception: E/M Services Furnished in Certain Primary Care Centers --
For the E/M codes listed below, pay teaching physician claims for
services furnished by residents without the presence of a teaching
physician. When a GME program is granted the primary care exception, it
applies to the following lower and mid-level E/M services:

New Patient
         Established Patient
99201
         99211
99202
         99212
99203
         99213


For this exception to apply, a center must attest to you in writing that
all of the following conditions are met for a particular residency
program.

The services must be furnished in a center located in the outpatient
department of a hospital or another ambulatory care entity in which the
time spent by residents in patient care activities is included in
determining direct GME payments to a teaching hospital by the hospital's
fiscal intermediary. This requirement is not met when the resident is
assigned to a physician's office away from the center or makes home
visits. In the case of a nonhospital entity, verify with the fiscal
intermediary that the entity meets the requirements of a written
agreement between the hospital and the entity set forth in 42 CFR
413.86(f)(1)(iii).

Any resident furnishing the service without the presence of a teaching
physician must have completed more than 6 months of an approved
residency program. If it becomes necessary to verify this information,
teaching hospitals are required to maintain such information under the
provisions 42 CFR 413.86(f)(2).

The teaching physician in whose name the payment is sought must not
supervise more than 4 residents at any given time and must direct the
care from such proximity as to constitute immediate availability. The
teaching physician must --

Have no other responsibilities at the time of the service for which
payment is sought;

Assume management responsibility for those beneficiaries seen by the
residents;

Ensure that the services furnished are appropriate;

Review with each resident during or immediately after each visit, the
beneficiary's medical history, physical examination, diagnosis, and
record of tests and therapies; and

Document the extent of his or her own participation in the review and
direction of the services furnished to each beneficiary. 

The patients seen must be an identifiable group of individuals who
consider the center to be the continuing source of their health care and
in which services are furnished by residents under the medical direction
of teaching physicians. The residents must generally follow the same
group of patients throughout the course of their residency program, but
there is no requirement that the teaching physicians remain the same
over any period of time.

The range of services furnished by residents includes all of the
following:

Acute care for undifferentiated problems or chronic care for ongoing
conditions including chronic mental illness;

Coordination of care furnished by other physicians and providers;

Comprehensive care not limited by organ system or diagnosis.

The types of residency programs most likely to qualify for the primary
care exception include: Family Practice, General Internal Medicine,
Geriatric Medicine, Pediatrics and Obstetrics/ Gynecology. Certain GME
programs in Psychiatry may qualify in special situation such as when the
program furnishes comprehensive care for chronically mentally ill
patients. These would be centers in which the range of services the
residents are trained to furnish -- and actually do furnish -- include
comprehensive medical care as well as psychiatric care. For example,
antibiotics are being prescribed as well as psychotropic drugs.

3. Procedures -- In order to bill you for surgical, high-risk, or other
complex procedures, the teaching physician must be present during all
critical and key portions of the procedure and be immediately available
to furnish services during the entire procedure.

a. Surgery (Including Endoscopic Operations) -- The teaching surgeon is
responsible for the preoperative, operative, and post-operative care of
the beneficiary. The teaching surgeon may determine which post-operative
visits are to be considered "key" and require his or her presence.
(However, if the post-operative period extends beyond the beneficiary's
discharge and the teaching surgeon is not going to be involved in the
beneficiary's follow-up care, the instructions on billing for less than
the global package in section 4824.B. apply.) During the period in which
the teaching surgeon does not have to be physically present, he or she
should remain immediately available to return to the procedure, i.e., he
or she must not be involved in another procedure from which he or she
cannot return. If the teaching physician leaves the operating room after
the key portion(s) of the surgical procedure or during the closing of
the surgical field to become involved in another surgical procedure, he
or she must arrange for another physician to be immediately available to
intervene in the original case should the need arise in order to bill
for the original procedure. The designee would be a physician who is not
involved in or immediately available for any other surgical procedure.
We are not defining availability in terms of geographic location
vis-a-vis the operating room.

(1) Single surgery -- When the teaching surgeon is present for the
entire period between the opening and closing of the surgical field, his
or her presence may be demonstrated by notes in the medical records made
by the physician, resident, or operating room nurse. For purposes of
this teaching physician policy, there is no required information that
the teaching surgeon must enter into the medical records.

(2) Two overlapping surgeries -- In order to bill for two overlapping
surgeries, the teaching surgeon must be present during the key portions
of both operations. Therefore, the key portions may not take place at
the same time. When all of the key portions of the initial procedure
have been completed, the teaching surgeon may begin to become involved
in a second procedure. The teaching surgeon must personally document the
key portion of both procedures in his or her notes in order that a
reviewer may clearly infer that the teaching physician was immediately
available to return to either procedure in the event of complications.
In the case of three concurrent surgical procedures, the role of the
teaching surgeon (but not anesthesiologist) in each of the cases is
classified as a supervisory service to the hospital rather than a
physician service to an individual beneficiary and is not payable under
the physician fee schedule.

(3) Minor procedures -- For procedures that take only a few minutes to
complete, e.g., simple suture, and involve relatively little decision
making once the need for the operation is determined, the teaching
surgeon must be present for the entire procedure in order to bill for
the procedure.

b. Anesthesia -- Pay an unreduced fee schedule payment if a teaching
anesthesiologist is involved in a procedure with one resident. The
teaching physician must be present during induction, emergence, and any
other portion of the procedure payable on a time basis. If an
anesthesiologist is involved in concurrent procedures with more than one
resident or with a resident and a nonphysician anesthetist, pay for the
anesthesiologist's services as medical direction. The documentation in
the medical records must indicate the teaching anesthesiologist's
presence or participation in the administration of the anesthesia. The
teaching physician's presence is not required during the preoperative or
postoperative visits with the beneficiary. 

c. Endoscopy Procedures -- In order to bill for procedures performed
through an endoscope (other than endoscopic operations that follow the
surgery policy in subsection a), the teaching physician must be present
during the entire viewing. The entire viewing includes insertion and
removal of the device. Viewing of the entire procedure through a monitor
in another room does not meet the teaching physician's presence
requirement.

4. Interpretation of Diagnostic Radiology and Other Diagnostic Tests --
Pay for the interpretation of diagnostic radiology and other diagnostic
tests if the interpretation is performed or reviewed by a physician
other than a resident. If the teaching physician's signature is the only
signature on the interpretation, you may assume that he or she is
indicating that he or she personally performed the interpretation. If a
resident prepares and signs the interpretation, the teaching physician
must indicate that he or she has personally reviewed the image and the
resident's interpretation and either agrees with it or edits the
findings. Do not pay for an interpretation if the documentation shows
simply a countersignature of the resident's interpretation by the
teaching physician.

5. Psychiatry -- For psychiatric services furnished under an approved
GME program, the requirement for the presence of the teaching physician
during the service may be met by concurrent observation of the service
by use of a one-way mirror or video equipment. Audio-only equipment does
not meet this exception to the physical presence requirement. In the
case of time-based services such as individual medical psychotherapy,
see section 7, below. Further, the teaching physician supervising the
resident must be a physician, i.e., the Medicare teaching physician
policy does not apply to psychologists who supervise psychiatry
residents in approved GME programs.

6. Time-Based Codes -- For procedure codes determined on the basis of
time, the teaching physician must be present for the period of time for
which the claim is made. For example, pay for a code that specifically
describes a service of from 20 to 30 minutes only if the teaching
physician is present for 20 to 30 minutes. Do not add time spent by the
resident in the absence of the teaching physician to time spent by the
resident and teaching physician with the beneficiary or time spent by
the teaching physician alone with the beneficiary. Examples of codes
falling into this category include:

Individual medical psychotherapy (CPT 90842-4)

Critical care services (CPT 99291-2)

E/M codes in which counseling and/or coordination of care dominates
(more than 50 percent) of the encounter, and time is considered the key
or controlling factor to quality for a particular level of E/M service.

Prolonged services (CPT 99354-9)

Care plan oversight (CPT 99375)

Anesthesia (See 3.B.)

7. Other Complex or High-Risk Procedures -- In the case of complex or
high-risk procedures for which national Medicare policy, your local
policy, or the CPT description indicate that the procedure requires
personal (in person) supervision of its performance by a physician, pay
for the physician services associated with the procedure only when the
teaching physician is present with the resident. The presence of the
resident alone would not establish a basis for fee schedule payment for
such services. These procedures include:

Interventional radiologic and cardiologic supervision and interpretation
codes;

Cardiac catheterization

Cardiovascular stress tests

Transeophageal echocardiography

8. Miscellaneous --

In the case of maternity services furnished to women who are eligible
for Medicare, apply the physician presence requirement for both types of
delivery as you would for surgery. In order to bill for the procedure,
the teaching physician must be present for the delivery. These procedure
codes are somewhat different from other surgery codes in that there are
separate codes for global obstetrical care (prepartum, delivery, and
postpartum) and for deliveries only. In situations in which the teaching
physician's only involvement was at the time of delivery, the teaching
physician should bill the delivery-only code. In order to bill for the
global procedures, the teaching physician must be present for the
minimum indicated number of visits when such a number is specified in
the description of the code. This policy differs from the policy on
general surgical procedures under which the teaching physician is not
required to be present for a specified number of visits.

D. Election of Costs for the Services of Physicians in a Teaching
Hospital -- A teaching hospital may elect to receive payment on a
reasonable cost basis for the direct medical and surgical services of
its physicians in lieu of fee schedule payments for such services. A
teaching hospital may make this election to receive cost payment only
when all physicians who render covered Medicare services in the hospital
agree in writing not to bill charges for such services or when all the
physicians are employees of the hospital and, as a condition of
employment, they are precluded from billing for such services. When this
election is made, Medicare payments are made exclusively by the
hospital's intermediary, and fee schedule payment is precluded.

When the cost election is made for a current or future period, each
physician who provides services to Medicare beneficiaries must agree in
writing (except when the employment restricting discussed above exists)
not to bill charges for services provided to Medicare beneficiaries.
However, when each physician agrees in writing to abide by all the rules
and regulations of the medical staff of the hospital (or of the fund
that is qualified to receive payment for the imputed cost of donated
physician's services), such an agreement suffices if the agreement is
required as a condition of staff privileges and the rules and
regulations of the hospital, medical staff, or fund clearly preclude
physician billing for the services for which costs benefits are payable.
The intermediary must advise you when a hospital election cost payment
for physicians' direct medical and surgical services and supply you with
a list of all physicians who provide services in the facility, and you
must ensure that billing received from these physicians or hospitals are
denied. 

Institute the following controls to ensure that bills for physician's
services in teaching hospitals that elect cost payment are recognized.
Coordinate with the intermediaries in your service area to receive a
listing of the teaching hospitals which have elected cost payment and
listings of all physicians whose services are payable to hospitals on a
cost basis. Flag your files in order that any claims for physicians'
services furnished in a hospital on the listing are denied. If the
hospital is not identified on the claim form, the system must reject the
claims for the services of any physician on the listing. Before such
claims may be denied or paid, determine where the services were
performed. (Physicians on the listing supplied by intermediaries may
also practice in hospitals that have not elected to receive cost
payment.) For more information about the teaching hospital cost
election, see section 2148 of the Provider Reimbursement Manual
(HCFA-Pub 15-1).

E. Assistant at Surgery Services Furnished in Teaching Hospitals --

1.General -- Do not pay for the services of assistants at surgery
furnished in a teaching hospital which has a training program related to
the medical specialty required for the surgical procedure and has a
qualified resident available to perform the service unless the
requirements of D.3, D.4, or D.5 are met. Each teaching hospital has a
different situation concerning numbers of residents, qualifications of
residents, duties of residents, and types of surgeries performed.
Contact those affected by these instructions to learn the circumstances
in individual teaching hospitals.

There may be some teaching hospitals in which you can apply a
presumption about the availability of a qualified resident in a training
program related to the medical specialty required for the surgical
procedures, but there are other teaching hospitals in which there are
often no qualified residents available. This may be due to their
involvement in other activities, complexity of the surgery, numbers of
residents in the program, or other valid reasons. You may process
assistant at surgery claims for services furnished in teaching hospitals
on the basis of the following certification by the assistant. The
certification may be an attachment to the claim or you may have some
Form HCFA-1500s preprinted with this statement and distribute them to
physicians who furnish assistant at surgery services in teaching
hospitals. This certification is for use only when the basis for payment
is the unavailability of qualified residents.

"I understand that section 1842(b)(7)(D) of the Social Security Act
generally prohibits Medicare physician fee schedule payment for the
services of assistants at surgery in teaching hospitals when qualified
residents are available to furnish such services. I certify that the
services for which payment is claimed were medically necessary, and that
no qualified resident was available to perform the services. I further
understand that these services are subject to post-payment review by the
Medicare carrier."

Retain the claim and certification for four years and conduct
post-payment reviews as necessary. For example, investigate situations
in which it is certified that there are never any qualified residents
available and undertake recovery if warranted.

Assistant at surgery claims denied on the basis of these instructions do
not qualify for payment under the waiver of liability provision.

2.Definition -- An assistant at surgery is a physician who actively
assists the physician in charge of a case in performing a surgical
procedure. The conditions for coverage of such services in teaching
hospitals are more restrictive than those in other settings because of
the availability of residents who are qualified to perform this type of
service.

3.Exceptional Circumstances -- Payment may be made for the services of
assistants at surgery in teaching hospitals, subject to the special
limitation in section 15044, not withstanding the availability of a
qualified resident to furnish the services. There may be exceptional
medical circumstances, e.g., emergency, life-threatening situations such
as multiple traumatic injuries which require immediate treatment. There
may be other situations in which your medical staff may find that
exceptional medical circumstances justify the services of a physician
assistant at surgery even though a qualified resident is available.

4.Physicians Who Do Not Involve Residents in Patient Care -- Payment may
be made for the services of assistants at surgery in teaching hospitals,
subject to the special limitation in section 15046, if the primary
surgeon has an across-the-board policy of never involving residents in
the preoperative, operative, or postoperative care of his or her
patients. Generally, this exception is applied to community physicians
who have no involvement in the hospital's GME program. In such
situations, payment may be made for reasonable and necessary services on
the same basis as would be the case in a nonteaching hospital. However,
if the assistant is not a physician primarily engaged in the field of
surgery, no payment may be made unless either of the criteria of
subsection 5 is met.

5.Multiple Physician Specialties Involved in Surgery -- Complex medical
procedures, including multistage transplant surgery and coronary bypass,
may require a team of physicians. In these situations, each of the
physicians performs a unique, discrete function requiring special skills
integral to the total procedure. Each physician is engaged in a level of
activity different from assisting the surgeon in charge of the case. If
payment is made on the basis of a single team fee, deny additional
claims. Determine which procedures performed in your service area
require a team to approach to surgery. Team surgery is paid for on a "By
Report" basis.

There are some situations when the services of physicians of different
specialities are necessary during surgery and when each specialist is
required to play an active role in the patient's treatment because of
the existence of more than one medical condition requiring diverse,
specialized medical services. For example, a patient's cardiac condition
may require the cardiologist be present to monitor the patient's
condition during abdominal surgery. In this type of situation, the
physician furnishing the concurrent care is functioning at a different
level than that of an assistant at surgery, and payment is made on a
regular fee schedule basis.