Working Paper: NBER ID: w31336
Authors: Jeffrey Clemens; Jonathan M. Leganza; Alex Masucci
Abstract: Over the last decade, the U.S. Medicare program has added new billing codes to enhance the financial rewards for Chronic Care Management and Transitional Care Management. We analyze the effects of introducing these new billing codes. First, we provide evidence on the adoption of the new codes by primary care physicians. We show that take-up of the new billing codes occurs gradually and exhibits substantial variation across space and across physician characteristics. Second, we provide evidence on how the new billing codes can both complement and substitute for the billing or provision of other services. We focus on two case studies. As a case of code substitution, we show that Transitional Care Management services partially crowd out traditional office visits following hospital discharges. As a case of code complementarity, we show that both Transitional Care Management and Chronic Care Management services predict increases in annual wellness visits. Overall, our analysis highlights how both new code take-up frictions and the impact of new code billing on existing code billing can be important for assessing the total costs and benefits of payment reforms.
Keywords: Medicare; billing codes; chronic care management; transitional care management; health care payment reforms
JEL Codes: H57; I11
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Transitional care management (TCM) codes (I11) | traditional office visits (I11) |
| Transitional care management (TCM) codes + Chronic care management (CCM) services (I11) | annual wellness visits (I19) |
| Transitional care management (TCM) codes (I11) | traditional office visits (I11) |
| Transitional care management (TCM) codes + Chronic care management (CCM) services (I11) | annual wellness visits (I19) |