Five Cardinal Compliance Rules

Posted on February 7, 2008 by Dr. David Edward Marcinko MBA MEd CMP™

Proper Use / Billing of CPT® and Diagnosis Codes

The health care industry operates in a heavily regulated environment with a variety of identifiable risk areas. An effective compliance program helps mitigate these risks.

-Corporate Responsibility and Corporate Compliance  [A Resource for Health Care Boards of Directors] 

The Five Cardinal Compliance Rules to Follow

 By Patricia A. Trites; PhD, MPA, CBC, CMP™ [Hon]

After completing and documenting a medical service, the next step is to “code” the procedure and the diagnosis for payment.

The Rationale

CPT® codes are updated annually and each healthcare organization should be sure to use current codes.

And, it is also important to make sure that these codes are not contingent upon whether payment will be made for the service, but should reflect the service(s) and the reason for the service(s) provided. 

Much has been written on selecting the correct procedure codes and the associated documentation that is required for each level of service. There are also rules associated with selecting the correct diagnosis code. The key issue in determining if a provider can be paid for their services is to show that there was a medically justifiable reason for performing the procedure or service.

Justifiability Requirements

Justifiability is established primarily by looking at the CPT® or procedure code that was billed in relation to the ICD-9 or diagnosis code that was given as the reason for the encounter or procedure. If medical necessity can be shown, the likelihood is that the bill will be paid.

The Cardinal Rules 

The basic requirement is that the diagnosis must justify the procedure.  If the following five rules are followed, there is a much better chance that the claim(s) will be paid.

 

  1. Code all diagnoses to the ultimate specificity
  2. Use additional code(s) and code any underlying diseases when necessary
  3. Code all the conditions encountered during the service to fully describe the encounter
  4. Choose the appropriate principal diagnosis and sequence all secondary codes correctly
  5. Avoid using .8 And .9 “catch-all” codes.

Conclusion 

As a provider or medical executive – do you code yourself or use an ancillary coder; in-house or out-sourced and why?  Please opine and comment. 

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New Pilot Program to Audit Hospital Bills

Posted on January 29, 2008 by Dr. David Edward Marcinko MBA MEd CMP™

Medicare Program Promotes Bounty-Hunter “Zeitgeist” Mentality

[By Dr. David Edward Marcinko; MBA]

Publisher-in-Chief dem2

According to a recent report in the Wall Street Journal, hospital groups have launched a vigorous campaign against expanding a pilot program to audit Medicare claims. And, it seems the most onerous aspect of the program is a contingency fee-schedule that encourages auditors to be aggressive.

Evolving Program Details

The program initially launched in California, Florida and New York and soon to be expanded nationwide, recouped $247.4 million in overpayments in fiscal year 2007 alone. It relies on private-sector auditing firms to examine claims filed by hospitals and other medical providers and then pays them contingency fees based on how much the government saves. 

Outcomes-to-Date

As an example of its success, the WSJ reported that in FY 2007, auditors identified $357 million in overpayments [$17.8 million or 7.1% of which were overturned on appeal], according to the Centers for Medicare and Medicaid Services [CMS]. Payments for contingency fees and other administrative expenses totaled $77.7 million. Auditors also found $14.3 million in Medicare underpayments.

Support versus Criticism

While supporters of the program say the contingency fees serve as an incentive, critics say it encourages auditors to rely on a “‘bounty hunter’ payment mechanism.”  

Same old Economic Song

Of course, most long-time observes of the compliance and audit scene realize that this zealous zeitgeist mentality is not new.

For example, under the Health Insurance Portability Accountability Act [HIPAA], the Department of Health and Human Service [HHS] started an “Incentive Program for Fraud and Abuse Information” [IPFAI] almost a decade ago. 

In that January 1999 pilot program – which continues in modified form – HHS paid fees ranging from $100-1,000 to Medicare recipients who reported abuse. To assist patients in spotting fraud, HHS even published examples of physician potential fraud, which include: 

  • Medical services not provided
  • Duplicate services or procedures
  • More expenses services or procedures than provided (upcoding / billing)
  • Misused Medicare cards and numbers
  • Medical telemarketing scams
  • Non-medical necessity, etc. 

To discourage flagrant allegations regulations require that reported information needed to directly contribute to monetary recovery for activities not already under investigation. 

Assessment

Nevertheless, expect a further erosion of patient confidence, as CMS continues to view all healthcare providers – and now hospitals and related healthcare organizations – in the same light as “bounty- hunters”. 

Ironically, this precise same phenomenon was reported in both the first and second editions of the book “The Business of Medical Practice”. 

And so, please remember all medical colleagues – forewarned is forearmed. 

More information: http://www.springerpub.com/prod.aspx?prod_id=23759 

Speaker: If you need a moderator or a speaker for an upcoming event, Dr. David Edward Marcinko; MBA is available for speaking engagements. Contact him at: MarcinkoAdvisors@msn.com

 

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Reducing Medicare Payment Denials and Reductions

Posted on December 7, 2007 by Dr. David Edward Marcinko MBA MEd CMP™

Start with Diagnosis Coding Documentation Guidelines

By Patricia A Trites; MPA, CHBC, CPC, CHCC, CHCO, CMP™(Hon) 

[CEO: Healthcare Compliance Resources, Inc]

A 2003 audit of Medicare claims by the Office of the Inspector General (OIG) found that Medicare fee-for-service payments that did not comply with all of the Medicare laws and regulation was $13.3 billion in fiscal years 2001 and 2002. 

Improper payments in 2002 occurred mostly in three areas: medically unnecessary services (57.1 percent), documentation deficiencies (28.6 percent) and miscoding (14.3 percent).

And so, how do you prevent or reduce denials or reduction of payment when claims are adjudicated as “not medically necessary”?  

Begin by following the diagnosis coding documentation guidelines, which are: 

  • Code to the ultimate specificity. There is a significant difference between 716.90, Arthritis, Type and Site Not Otherwise Specified, and 716.39, Menopausal Arthritis, Multiple Sites-Joints.
  • Use Additional Codes and Underlying Disease Codes. Many conditions require, by medical-record coding rules, that you use two ICD-9 codes and that these codes are put in the appropriate order. For example, 533.30 Peptic Ulcer-Acute and Without Obstruction, and 041.86, Due to Helicobacter Pylori Infection.
  • Use multiple codes to fully describe the encounter. This includes coding any additional co-morbidities and/or signs and symptoms that affect the patient’s current encounter.
  • Choose the appropriate principals diagnosis and properly sequence secondary codes. List first the ICD-9-CM code for the diagnosis, condition, problem, or other reason for encounter/visit shown in the medical record to be chiefly responsible for the services provided. Then list additional codes that describe any co-existing conditions or symptoms.
  • Avoid using .8 and .9 “catch-all” codes. In the ICD-9 system, descriptions and digits are provided for times when a physician lack information about a patient’s exact condition or diagnosis. The codes commonly end in .8 or .9 and are commonly referred to as catch-all codes. Under Medicare coding guidelines, these codes should be used only when the specific information required to code correctly is unknown or unattainable. 

Do you use a professional coder in your healthcare entity; or do you do-it-yourself?

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