E/M Coding in 2021: The Times (and More) Are A-Changin’

Author and Disclosure Information

Major revisions for commonly reported office and outpatient evaluation and management (E/M) codes were implemented on January 1, 2021, by the American Medical Association and Centers for Medicare and Medicaid Services. The goal of these changes was to simplify and streamline these service codes, with time and medical decision-making (MDM) now being the sole determinants of the overall E/M level. We present an overview of the new guidelines, requirements, and code descriptors to aid in accurate documentation and billing. Additional resources are provided if further billing and coding questions arise.

Practice Points

  • The outpatient evaluation and management (E/M) codes have undergone substantial changes that took effect January 1, 2021.
  • Outpatient E/M visits are now coded based on time or level of medical decision-making (MDM).
  • Time now includes all preservice, intraservice, and postservice time the physician spends with the patient on the date of the encounter.
  • Many of the key definitions used in order to determine level of MDM have been streamlined and updated.



Effective on January 1, 2021, the outpatient evaluation and management (E/M) codes underwent substantial changes, which were the culmination of multiple years of revision and surveying via the American Medical Association (AMA) Relative Value Scale Update Committee and Current Procedural Terminology (RUC-CPT) process to streamline definitions and promote consistency as well as to decrease the administrative burden for all specialties within the house of medicine.1 These updates represent a notable change from the previous documentation requirements for this oft used family of codes. Herein, we break down some of the highlights of the changes and how they may be applied for some commonly used dermatologic diagnoses.

Time Is Time Is Time

Prior to the 2021 revisions, a physician generally could only code for an E/M level by time for a face-to-face encounter dominated by counseling and/or care coordination. With the new updates, any encounter can be coded by total time spent by the physician with the patient1; however, clinical staff time is not included. There also are now clear guidelines of the time ranges corresponding to the level of E/M,1 as noted in Table 1.

Total Visit Times by E/M Level

Importantly, time now includes not just face-to-face time with the patient but also any time on the date of the encounter that the physician is involved in the care of the patient when not reported with a separate code. This can include reviewing notes or data before or after the examination, care coordination, ordering laboratory tests, and providing any documentation related to the encounter. Importantly, this applies only when these activities are done on the date of the encounter.

If you work with a nurse practitioner or physician assistant (PA) who assists you and you are the one reporting the service, you cannot double-dip. For example, if your PA spends 10 minutes alone with a patient, you are in the room together for 5 minutes, the PA spends another 10 minutes alone with the patient afterward, and you do chart work for 10 minutes at the end of the day, the total time spent is 35 minutes, not 40 minutes, as you cannot count the time you and the PA spent together twice.

Decisions, Decisions

Evaluation and management coding also can be determined via the level of medical decision-making (MDM). Per the 2021 guidelines, MDM is comprised of 3 categories: (1) number and complexity of problems addressed at the encounter, (2) amount and/or complexity of data to be reviewed or analyzed, and (3) risk of complications and/or morbidity or mortality of patient management.1 To reach a certain overall E/M level, 2 of 3 categories must be met or exceeded. Let’s dive into each of these in a little more detail.

Number and Complexity of Problems Addressed at the Encounter
First, it is important to understand the definition of a problem addressed. Per AMA guidelines, this includes a disease, condition, illness, injury, symptom, sign, finding, complaint, or other matter addressed at the encounter that is evaluated or treated at the encounter by the physician. If the problem is referred to another provider without evaluation or consideration of treatment, it is not considered to be a problem addressed and cannot count toward this first category. An example could be a patient with a lump on the abdomen that you refer to plastic or general surgery for evaluation and treatment.

Once you have determined that you are addressing a problem, you will need to determine the level of complexity of the problem, as outlined in Table 2. Keep in mind that some entities and disease states in dermatology may fit the requirements of more than 1 level of complexity depending on the clinical situation, while there are many entities in dermatology that may not be perfectly captured by any of the levels described. In these situations, clinical judgement is required to determine where the problem would best fit. Importantly, whatever you decide, your documentation should support that decision.

Levels of Complexity of Problems Addressed

Amount and/or Complexity of Data to Be Reviewed and Analyzed
This category encompasses any external notes reviewed, unique laboratory tests or imaging ordered or reviewed, the need for an independent historian or discussion with external health care providers or appropriate sources, or independent interpretation of tests. Some high-yield definitions in this category are outlined in Table 3.

High-Yield Sources of External Data to Be Reviewed1

Risk of Complications and/or Morbidity or Mortality of Patient Management
In this category, risk relates to both the patient’s diagnosis and treatment(s). Importantly, for treatment and diagnostic options, these include both the options selected and those considered but not selected. Risk is defined as the probability and/or consequences of an event and is based on the usual behavior and thought processes of a physician in the same specialty. In other words, think of the risk as compared to risk in the setting of other dermatologists diagnosing and/or treating the same condition.

Social determinants of health also play a part in this category and are defined as economic and social conditions that influence the health of individuals and communities. Social determinants of health can be indicated by the specific corresponding International Statistical Classification of Diseases, Tenth Revision code and may need to be included in your billing according to specific institutional or carrier guidelines if they are a factor in your level of MDM.

For the purposes of MDM, risk is stratified into minimal, low, moderate, and high. Some examples for each level are outlined in Table 4.

Risk Stratification in Medical Decision-making

Putting It All Together

Once you have determined each of the above 3 categories, you can put them together into the MDM chart to ascertain the overall level of MDM. (The official AMA medical decision-making grid is available online []). Keep in mind that 2 of 3 columns in the table must be obtained in that level to reach an overall E/M level; for example, a visit that addresses 2 self-limited or minor problems (level 3) in which no data is reviewed (level 2) and involves prescribing a new medication (level 4), would be an overall level 3 visit.

Final Thoughts

The outpatient E/M guidelines have undergone substantial revisions; therefore, it is crucial to understand the updated definitions to ensure proper billing and documentation. History and physical examination documentation must be medically appropriate but are no longer used to determine overall E/M level; time and MDM are the sole options that can be used. Importantly, try to code as accurately as possible, documenting which problems were both noted and addressed. If you are unsure of a definition within the updated changes and MDM table, referencing the appropriate sources for guidance is recommended.

Although representing a considerable shift, the revaluation of this family of codes and the intended decrease in documentation burden has the ability to be a positive gain for dermatologists. Expect other code families to mirror these changes in the next few years.

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