Health Information Management

Eliminate missed charges, errors to reduce lost revenue

JustCoding News: Outpatient, December 16, 2009

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As more services shift from the inpatient to the outpatient setting, coders are under additional pressure to ensure that facilities receive the appropriate reimbursement.

The HHS, Inc., report “America’s Hidden Healthcare Crisis” states that $100 billion of revenue annually is lost to coding and billing errors.

“I agree with the HSS, Inc. report that payers reject 30% of outpatient claims and facilities never resubmit half of those rejected claims,” says Mary Phelps, RHIA, CCS, CTR, CIRCC, CCDS, senior associate in healthcare compliance management at PricewaterhouseCoopers in Charlotte, NC. “People are so overwhelmed with their daily job they don’t have time to look at failed claims.”

Phelps and Cornelia L. McClure, RHIA, CCS, HIM systems/operations specialist at Cape Fear Valley Health System in Fayetteville, NC, discussed ongoing coding and charge challenges during the October 3–7 American Health Information Management Association national convention in Grapevine, TX.

Operational inefficiencies and outdated technology can result in lost revenue. Silo thinking throughout the facility, such as, “It’s not my area,” also can contribute to lost revenue.

Challenges for facilities

Facilities face several challenges when trying to implement change to capture lost revenue, including financial cost. Various departments need to work together so claims go out clean the first time, which can also be a challenge, McClure says. Coders can help by educating other staff members about the importance of correct coding and charging, a task that might be difficult.

“[Change involves] lots of things where we have to step outside of our comfort zone,” McClure says.

Don’t merely look for big-dollar savings. Small-dollar savings will add up to a significant amount, McClure says. But if you don’t tell others at your facility about the potential additional revenue, including clinical staff members, other coders, and the finance department, they won’t know.

Buy-in from the administration

One of the biggest challenges for change can be gaining administration buy-in. It is critical for successful change that administration supports the project. The administration should then, in turn, hold managers accountable for their roles in the new project.

If staff members see that management isn’t buying in to the changes, they won’t either, McClure says.

Start by showing the administration how much money your facility is losing and how much money it stands to gain if every claim includes all the appropriate charges. That increased revenue could potentially lead to additional staff positions, something that could make it easier for you to get other departments on board with changing processes for charting documentation, charging, and billing.

In addition, talk to staff members in each department of your facility, including physicians and nurses, about how improvement in documentation would improve revenue opportunities.

“Others don’t always understand what documentation is needed to allow the appropriate coding of a procedure based on coding guidelines, which leads to correct charge capture,” McClure says.

Without the appropriate documentation, coders may not be able to code the procedure, and the facility ends up providing a free service.

“Facilities should do quality checks on the coding coming from all areas just like they do for the coding coming from the HIM department. They should compare the documentation in the medical record to what was coded and what actually shows on the claim,” says McClure.

Specific problem areas

Interventional radiology, interventional cardiology, wound care, modifiers, medical necessity, and therapy all present specific revenue challenges, say Phelps and McClure.

For example, if a vascular procedure takes place in an OR suite and the catheterization lab isn’t coded, your facility loses revenue. The missing information could be the result of a procedure occurring in an area where it usually isn’t performed, so staff members need to document everything they did to allow coders to assign the appropriate code.

“Make sure that everything that was performed has a code,” Phelps says.

A lack of complete documentation can also lead to lost revenue for wound debridement. Clinical staff members need to provide specific documentation of whether they removed necrotic or live tissue to keep coders from guessing, Phelps says.

Unna boots and compression dressings can also cause coding problems. Different Medicare Administrative Contractors and Fiscal Intermediaries (FI) have different ways of defining which compression dressings will qualify for additional procedures. Some FIs allow CPT code 29580 (strapping Unna boot for compression dressings), so you need to know your local contractor’s policies to code correctly.

Modifier mistakes

Incorrect use of modifier -59 is another problem area for facilities and coders. Append modifier -59 to identify procedures or services that are not normally reported together. This modifier indicates that the physician performed two or more procedures at different anatomic sites or during different patient encounters. Coders should only use it when no other modifier more appropriately describes the relationships of the two or more procedure codes.

Using modifier -59 may bypass a National Correct Coding Initiative edit and allow coders to report two codes that generally can’t be used together. However, this doesn’t mean they are correctly assigning the modifier or that they have correctly coded the encounter.

“Just because it allows us to use modifier -59 doesn’t mean you can break a code out as a separate procedure unless the documentation supports the modifier use,” Phelps says.

Coders also need to make sure they are assigning the proper modifier for cancelled procedures.

“With outpatient coding on the facility side, remember to use modifiers -73 and -74 depending on when the procedure was cancelled. Have a process in place at your facility to make sure coders are made aware of the cancelled procedures,” Phelps says. “You have to think about a lot of things for cancelled procedures, but it’s worth it because you could be missing reimbursement for the resources used.”

Inpatient-only procedures

CMS classifies certain procedures as inpatient only and will not reimburse an outpatient facility under the Outpatient Prospective Payment System (OPPS) for performing such a procedure. Coding an inpatient-only procedure at an outpatient facility can result in a big revenue loss.

To avoid this problem, make sure all coders know which procedures are considered inpatient only. You can find the list of inpatient-only procedures in OPPS Addendum E. In addition, consider setting up a front-end process to catch these patients at the time of registration and remind clinical staff members of the importance of dictating all of the information needed so the coder can select the correct CPT code.

Coders must avoid what Phelps calls “encoderitis,” coding based only on what the encoder software provided. “That’s what the encoder gave me” is not a defense facilities can use during an audit, she says. Coders should remember that the encoder is a tool, not a coding source.

Injections and infusions

Coders still struggle with coding injections and infusions. At Cape Fear Valley, McClure and her colleagues realized they couldn’t capture all of the charges for injections and infusions performed due to documentation requirements based on coding guidelines. As a result, they educated clinical staff members on better documentation practices to make sure coders could capture charges in every department.

In addition, they looked at the hospital’s documentation and redesigned the paper record for one of the urgent care centers to include a place to record start and stop times. 

Creative solutions

Facilities must look for creative ways to solve revenue challenges, Phelps says. For example, look at your facility’s processes. Find the places where charges most often slip through the cracks, then consider ways to change the process. Not every change will work, but you should at least try, Phelps says.

When a process change does work, make sure people know about it. “If you can change a process and get better results, you better shout it from the rooftop,” Phelps says.

Editor’s note: E-mail Phelps at

E-mail McClure at

This story was originally published in the December issue of Briefings on APCs.

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