ReimbursementClinical Coding and Coding ComplianceCh-2: Page | 1

Clinical Coding--Reimbursement Connection

Claims submitted must comply with the guidelines and conventions published for the various clinical coding sets:

HIPAA designated code sets

Inpatient / Outpatient
Provider / Dx / Proced / Dx / Proced
Physician / ICD-9-CM / CPT / ICD-9-CM / CPT
Facility / ICD-9-CM / ICD-9-CM / ICD-9-CM / HCPCS

ICD used world-wide for mortality reporting. Maintained by WHO. Updated approx. every 10 yrs.

ICD-10: 10th revision. US will use Clinically Modified (CM). This will provide greater detail and granularity to allow more accurate code submission.

This allows payers to better measure quality outcomes and expand pay-for-reporting and pay-for-performance programs.

ICD-10-PCS allows US to realize benefits of interoperability stds specified by HC IT Stds Panel (HITSP). Limits use of "Not elsewhere classified".

ICD-9-CM: Developed by Nat'l Ctr for Health Statistics (NCHS). US version expanded to include morbidity or chronic conditions and procedure reporting.

Uses:

  • classifying morbidity and mortality information for statistical purposes.
  • Classifying diagnoses and procedures information or epidemiological and clinical research.
  • Indexing hospital records by disease and surgical procedure.
  • Reporting information to various Healthcare reimbursement systems
  • analyze resource consumption patterns.
  • Analyzing adequacy of reimbursement or health services

Providers use ICD-9-CM to determine payment categories for various PPSs:

  • Hosp. Inpt: MS-DRGs
  • Hospital rehab: case-mix groups (CMGs)
  • long-term care: LTC MS-DRGs
  • home health resource groups (HHRGs)

ICD-9-CM Dev’p by Nat’l Ctr for Health Stats (NCHS) 1979.

Int’l version focuses on acute illnesses and mortality

CM expanded: incl. morbidity or chronic conditions and procedure reporting

Structure: Tabular List, Alpha List, Procedures

Dx: 3-5 digits Proc: 2-4 digits

Maintenance: Coordination and Maintenance Cmte (NCHS-Dx & CMS-Proc) advisory in nature. Final determinations are made by the director of NCHS and administrator of CMS. Public meetings (March & Sept.) for changes,determined after the December meeting, become effective October 1 of the following year.

ICD-9-CM Coding Guidelines

Codes serve as communication vehicle between providers and insurers. Vital to follow guidelines. Accurate reimbursement, dependent upon timely, accurate, and complete coding of services and procedures provided.

Cooperating parties -- NCHS, CMS, AHA, AHIMA = editorial advisory board resp. For publishing coding guidelines for ICD-9-CM. AHA publ. guidelines in Coding Clinic(official).

  • Official coding advice and official coding guideline
  • correct code assignments for new technologies and newly identified diseases
  • articles and topics that offer practical information and improve data quality
  • coding changes and/or corrections
  • FAQs with practical examples

Coding clinic should be a compliment of all coding education and compliance programs for HC provider and facility coding units.

Healthcare Common Procedure Coding System (HCPCS) -- Two-tiered syst. Of procedural code, used primarily for ambulatory care and physician services. HCPCS codes are frequently attached to Inpt and Outpt charge description masters (CDMs) to facilitate commun. btwn providers and payers about services and supplies included in the CPT or HCPCS Level II syst.

Current Procedural Terminology CPT (HCPCS Level I) -- Reports diagnostic and surgical services and procedures. Created and first published by AMA in 1966. Used by physicians to report services and procedures performed in the hospital inpatient and outpatient setting. And by facilities for outpatient services and procedures.

  • Communication vehicle for public and private reimbursement systems
  • Development of guidelines for medical care review
  • Basis for local, regional, and national utilization comparisons
  • Medical education and research

code set adopted into HCPCS in 1985.

Structure: Category I (6 Sections), Category II (optional tracking for performance measurement), Category III (Temp, New Technol.), Modifiers.

Category I: describe a procedure or service that is consistent with contemporary medical practice and is performed by many physicians and clinical practice in multiple locations. FDA has approved devices & drugs in this category. 5-digit numeric.

Category II: facilitate data collection for certain services and/or test results that contribute to positive health outcomes and quality patient care. 5-digit ends in F.

Category III: Represent emerging technologies. Must have relevance for research, either ongoing or planned. 5-digit, ends in T.

Modifiers: Two-digit numeric or alphanumeric character, designed to give Medicare and other third-party payers. Additional information needed to process claim. Flags a service altered by some special circumstance(s) but for which the basic code description itself has not changed.

Modifier 91 is used to indicate a clinical lab test was repeated. The modifier indicates the duplicate code reported was not accidental or fraudulent, but based on medically necessary foundation. Supporting documentation is required and establishes the medical necessity criteria.

Maintenance of CPT -- 16-member CPT Editorial Panel (meets 4 x's/yr). Editorial Panel supported by CPT Advisory Cmte. Revised annually Jan.1.

Requesting Code Modifications: Use coding change request form on AMA website. Categ. I and III Submissions are passed on to CPT Advisory Cmte Categ. II passed on the Performance Measurement Advisory Grp for review. 2/3 majority must vote for adding the code before it is passed on to CPT Advisory Cmte. Only those warranting final review are passed on to CPT Editory Panel for final decisions on all coding modifications.

CPT Coding Guidelines: -- Official publication of CPT Assistant (AMA) contains

  • coding communication that provides up-to-date information on codes and trends
  • critical opinion that offer insight into confusing coding and modifier usage scenarios
  • coding consultation that covers the most frequently asked questions

All coding education and compliance programs should include the use of CPT Assistant.

HCPCS Level II -- Developed by CMS in 1980s to report services, supplies, and procedures not represented in CPT but submitted for reimbursement. System is managed by both private and public health insurers. Existence of a particular code does not guarantee or indicate coverage/reimbursement by Medicare, Medicaid, or other third-party payers. 2 types of codes in HCPCS Level II syst: permanent and temporary.

HCPCS Level II Permanent Codes (National) -- May be used by all public and private health insurers. Letter+4 numbers. Letter designates the category the codes is classified in. Miscellaneous codes are manually reviewed and require pricing and documentation of medical necessity.

Current dental terminology (CDT4) dental codes are a separate category of national permanent codes. First letter D.

HCPCS Level II Temporary Codes -- used to meet the immediate and short-term operational needs of individual insurers, public and private. Letter+4 letters. Temporary codes may remain as such by an indefinite period of time. If necessary a permanent code will be created to replace the temporary code in the temporary codes will be deleted.

HCPCS Level II Modifiers 2-digit alpha or alphanumeric codes. Indicate body areas that allow for specific information provided

Maintenance of MCPCS Level II Coding System -- Permanent codes maintained jointly by an American health insurance plans (AHIP), Blue Cross and Blue Shield Association (BCBSA), and CMS = national panel.

Permanent national coats updated January.

Temporary codes, maintained by individual's of national panel.

Requesting Code Modification for HCPCS Level II -- Can submit any time of the year. Three types: addition, language used to describe an existing code may be changed, existing code may be deleted. Continuous process April 2 through following April 1. Request form on the CMS website. Submit it to your cell phone-numeric HCPCS coordinator at CMS. Reviewed by CMS HCPCS Workgroup at monthly meetings. National panel is responsible for approving of code modifications. All three members must agree.

HCPCS Level II Coding Guidelines -- AHA Coding Clinic for HCPCS not official, but expert. Published by Central Office of ICD-9-CM. No official coding resource other than coverage determinations issued by CMS and its Medicare administrative contractors (MACs).

Coding is not dictate coverage of medical services for reimbursement policies.

Coding Compliance, And Reimbursement -- For coding, billing, and reimbursement professionals, being compliant means performing job functions according to the logs, regulations, and guidelines set forth by Medicare and other third-party payers. It is their responsibility to perform their jobs with integrity at all times. AHIMA standards of ethical coding , sets forth guidelines professionals should understand.

Fraud (Worse) -- An intentional representation data in individual notes defaults, or does not believe to be true and makes, knowing that the representation could result in some other authorized benefit himself/herself or some other person.

Abuse -- When a healthcare provider unknowingly or unintentionally submit an inaccurate claim for payment. Generally results from unsound medical, business, or fiscal practices that directly or indirectly result in unnecessary costs to the Medicare program.

Examples:

  • billing for services not furnished (F)
  • misrepresenting the diagnosis to justify payment (F)
  • soliciting, offering, or receiving a kickback (F)
  • unbundling or "exploding" charges (A)
  • falsifying certificates of medical necessity, plans of treatment, and medical records to justify payment (F)
  • billing for services not furnished us billed (known as upcoding) (A/F)

Congress has several targeting fraud and abuse

  • Protects the Medicare trust fund
  • Gave CMS resources and penalties to settle fraud and abuse

False Claims Act -- Passed during the Civil War to prohibit contractors of any kind from knowingly filing a false or fraudulent claim, using a false record or statement, or conspiring to defraud the US government. Continues to serve to rebuke abusers of the Medicare and Medicaid system. Allows for fines up to $10,000 violation and exclusions from Medicare participation.

Office of Inspector General Compliance Program Guidance -- 1991: OIG released seven elements of effective corporate compliance plan (revised 2005):

  • Designation of the compliance officer and complaints committee
  • Development of compliance policies and procedures, including standard of conduct
  • Development of open lines of communication
  • Appropriate training and education
  • Internal monitoring and auditing
  • Response to detected deficiencies
  • Enforcement of disciplinary standards

Compliance Program Guidance For Clinical Laboratories 1997

Supplemental Compliance Program Guidance For Hospitals 2005

Operation Restore Trust (Clinton)

Joint effort of DHHS, OIG, CMS, and Admin on Aging (AOA). Released in 1995, the Turkish fraud and abuse among healthcare providers. Spent $7.9 million / recovered $188 million. Established

  • National toll-free fraud and abuse hotline
  • Voluntary disclosure program
  • Special fraud alert documents

Health Insurance Portability And Accountability Act Of 1996 (HIPAA) -- The key fraud and abuse areas targeted are:

  • medical necessity
  • Upcoding
  • Unbundling
  • Billing for services provided

Established Medicare integrity program. Reviewing past claims for fraud and abuse, focused expanded to cost reports, payment determinations, and the need for ongoing complaint education.

Balanced Budget Act of 1997 (BBA) -- Began educating beneficiaries unbearable in preventing fraudulent and. Beneficiaries rise to review Medicare summary notices (MSNs/EOBs) for errors and report errors to the secretary of DHHS.

Beneficiaries notified of right to request copies of detailed bill for services and informed about the toll-free fraud and abuse hotline.

Expansion: DOJ & FBI in order to keep up with warranted reviews. Pepper program (Program for Evaluating Payment Patterns Electronic Report)

Improper Payment Information Act of 2002 (IPIA) andImproper Payments Elimination Recovery Act of 2010 (IPERA) (Bush)

IPIA requires all federal agencies provide an estimate of improper payments in what actions are being taken to reduce improper payments.

IPERA amended IPIA.

CHIP is a program that has significant potential for improper payments.

 CMS created Payment Error Rate Measurement (PERM) program. Complies with IPIA. It collects error rates and measures errors. Educational materials, statistics, and reports can be found on the CMS website.

CERT (Medicare Comprehensive Error Rate Testing)Complieswith IPERA.

CMS is required by the act to protect the Medicare trust. CMS has established the Medicare Review and Education Program, based on Progressive Corrective Action (PCA). CMS utilizesA/B MACs and DME MACs to complete medical reviews (improper payment reviews). These entities are referred to as Medicare contractors.

PCA (progressive corrective action) includes the following steps:

  • Data analysis
  • Error detection
  • Validation errors
  • Provider education
  • Determination of review type
  • Sampling of claims
  • Payment recovery

Medicare contractors focused reviews of the identified areas determined by contractor data analysis, search finding,OIG/GAO reports, and Recovery Audit Contractor (RAC) vulnerabilities work.

Major causes the improper payments include:

  • Physician orders missing
  • Signatures being eligible for missing
  • National Coverage Determinations (NCDs) / Local Coverage Determinations (LCDs) . Requirements not being met
  • Medical record documentation not supporting medical necessity

Provider education is the key component of this program.

Medicare contractors are expected to publish LCDs to provide guidance to the medical community regarding coverage, coding, and medical necessity requirements.

Medicare Learning Network(MLN) articles should be created in an effort to improve transparency of the medical review process.

Comprehensive Error Rate Testing Program (CERT)

At first, run by OIG 1996 to 2002

Transition to Medicare beginning in 2001.

Purpose of CERT is to measure improper payments, not to measure fraud. Examples

  • payment that should not have been made.
  • Payment made in an incorrect amount.
  • Payment to an end eligible to be.
  • Duplicate payment.
  • Payment for service that was not received.

OIG Reports -- significant, oh I see reports are communicated via Medicare transmittal to Medicare contractors for use in medical review activities (RAC).

National Recovery Audit Program (RAC) (Pilot) -- Began as a demonstration project(MMA 2003) such and was so successful (2005-2008) it is now fully implemented CMS program. Encompasses all areas of Medicare fee-for-service and Medicaid. It is sponsored by the Medicare Integrity Programdesigned to prevent improper payments and ultimately to protect the Medicare trust fund.

It answered the question of whether RACs were a cost-effective method of ensuring correct payment under Medicare. $1.03billion in overpayments recouped.Each

Implementation was based on CERT report. 4.4% of Medicare dollars paid did not comply with Medicare coverage, coding, billing, or payment rules. $10.8 billion

RACs , identify under- and overpayments (M'care A & B) primary and secondary payer.

RACs recoup overpayments from providers.CMS added resources to the compliance section without additional costs.

Lessons Learned From The RAC, which Demonstration Project

  • RACs are able to find a large volume of improper payments
  • providers do not appeal every overpaid the determination
  • overpayments collected were significantly greater than the program costs
  • RACs are willing to spend time on provider outreach activities, developing strong relationships with provider organizations
  • it is administratively possible to have a RAC . Work closely with the Medicare claims processing contractor
  • RAC efforts did not disrupt Medicare for law enforcement and type fraud activities
  • it is possible to find companies willing to work on a contingency fee basis

Feedback from providers yielded a number of modifications to improve RAC program

  • Having all new push issues a RAC wishes to pursue for overpayments validated by CMS are an independent RAC Validation Contractor and sharing the upcoming new issues with provider organizations
  • Requiring each new RAC to hire a physician medical director as well as certified coders
  • Requiring the RACs to pay that contingency fees would improper payment determination is overturned at any level of appeal
  • Changing from a four-year look-back period to a three-year look-back period
  • Adding a maximum look-back date of each October 1, 2007
  • Adding a web-based applications that will allow providers to look at the status of medical record reviews

Tax Relief and Healthcare Act (TRHCA) of 2006 made the RAC program permanent. 4 RAC jurisdictions. Each RAC must have review issues, vulnerabilities, approved by the Recovery Audit Validation Contractor prior to performing audits. Vulnerabilities must be published on the website prior to audit.

Only 5% of total claims ID'd by RACs were challenged by providers In 2010. Only 2.4% of those were challenged and overturned on appeal. Facilities must incorporate issues identified by RACs and other Medicare contractors into their coding compliance plans.

Other Third-Party Payer Reviews -- Actual payers tend to follow Medicare's lead and apply it to their own review portfolio. These review topics and findings should be incorporated into the coding compliance plans.

Coding Compliance Plan

Each coding unit focuses in regulations and guidelines with which coding professionals must comply. Compliance Program Guidance (DHHS/OIG guidance)

Core Areas:

  • Policies and procedures.
  • Education and training,
  • Auditing and monitoring

Policies and Procedures

Well-designed complete policies provide employees with consistent guidance to perform assigned tasks.

Managers perform job analysis ensures that every task has been established policy or procedure to govern it.

Finally, is a listed species that should be included in a coding compliance plan. At least...

  • efficient query process
  • coding diagnoses not supported by medical documentation
  • upcoding
  • unbundling
  • coding medical records without complete documentation
  • assignment discharge destination codes
  • correct use of encoding software
  • complete process for using the scrubber software

Education and Training (CE hours) -- To be complainant, coding, billing, and reimbursement professionals must continually participate in their education. Sample issues that should be placed on the continuous education schedule includes