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Consider software for medical necessity determinations for lab services

Patient Financial Services Weekly Advisor, November 19, 2004

Advance beneficiary notices (ABN) are an intricate part of laboratory compliance, and using a software program can help, says Emma Wollschlager, a senior consultant with Sinaiko Healthcare Consulting in Los Angeles.

She says an electronic system can do the following:

1. Eliminate gray areas in the front-end process. Admission staff usually don't have coding experience, and there's a lot of turnover in that department, she says. "It's hard to train them sufficiently to make medical-necessity determinations-even if they have a guide.

"They can consult local medical review policies that cover certain tests and the National Coverage Determinations," she says, "but you want to have the least amount of judgment calls [possible] from front-end personnel."

2. Track the chain of events in the lab. The software program will simplify the ABN process by tracking whether the patient signed the ABN. It will also keep you from digging up documentation. "When billing department staff submit a bill to Medicare, they need to know a lot things, such as the correct condition codes to use, whether the patient signed the ABN, and whether they can bill this to Medicare. That's why you don't want them pulling paper ABNs from the front-end financial folders."

In addition, if physicians need to provide additional diagnostic information or supplemental orders, the information can be entered directly into the account through the software, she says.

"So when the back-end [staff] submit the bill, they have all the information necessary to submit an accurate claim. At the touch of a screen, they would know whether or not they can bill Medicare or determine what modifiers they need without having to go back to the paperwork."

3. Educate physicians. "You can run reports for each physician because you have to enter in your ordering physician" when using the software, she says. "That way, you can see which doctors are generally ordering things that fall outside the medical-necessity guidelines."

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