Don't let rehab slip and fall: Detailed coding can capture capitation dollars
September 1, 1997 5 minutes read
Don’t let rehab slip and fall: Detailed coding can capture capitation dollars
Do HMOs tend to retreat from rehabilitation?
Physical therapy often such a critical part of full recovery may be falling through the cracks in your facility for patients covered under capitated contracts.
In some cases, rehabilitation only gets a penny or two after the capitation payment is divvied out, warns Wanda Ziemba, senior consultant for Reinisch Consulting in San Ramon, CA. Little wonder some rehab units are suffering, and fears are rampant that HMO patients aren’t getting the therapy they need. (See related story, p. 131.)
If you’re concerned that capitation payments aren’t covering physical therapy, resulting in patients being discharged to nursing homes rather than to rehab and ultimately a fuller life back at home you can do more about it than worry, suggests Ziemba.
More aggressive coding may be your answer, she says. "Aggressive" does not necessarily mean inappropriate coding, but instead more complete coding that can lead to a number of key accomplishments for your hospital and the physicians who refer patients to your rehab unit. Experts say a more methodical coding application in the rehab area, in many cases, can accomplish the following:
• improve the clinical data base in your facility;
• provide documentation of the full scope of your rehab clinical costs;
• predict levels of risk and utilization;
• position your facility to demonstrate your costs to an HMO and justify the capitation payments you need;
• save your rehab department from going under from the cost pressures of managed care.
It’s true that coding and reimbursement are not the driving factors in choosing ICD-9-CM and CPT codes. Yet in the real world, coding for fee-for-service differs in some important ways from coding for capitation, or at least has some distinct priorities.
Coding for capitation requires nuances
This is especially true in the rehab environment. Typically, fee-for-service only requires a "V" code for rehab. If that’s all you use, however, you’re missing out on documenting all the activities that surround physical therapy. That’s why so many hospital-based rehab units are taking it on the chin financially under capitation arrangements. While it won’t make a difference financially to add the related codes in fee-for-service reimbursement cases, it clearly can make a difference in capitation.
"Where this really came in handy was when a major insurance company asked [hospital officials] for a capitation contract, and it would have been impossible to tell whether the offer was fair or not," says Ziemba, referring to a recent client. In her experience, in some cases a capitation proposal would be beneficial, and in other cases it would have been devastating. The key was knowing exactly what rehab involved and its costs.
Here is a step-by-step outline of a case study of how Ziemba revised coding practices for several rehab units so that they could make a case for a larger capitation payment:
Going on rounds with doctors. "I took rounds with the doctors in their clinics and in the inpatient setting," she says. "What I found is that physicians and support staff spend a whole lot of time with family, preparing them, showing them how the patient should be handled at home. Their work included education regarding overall home management, daily exercise routines, medicating rehab patients who can’t care for themselves." Time physicians spend with patients and their families in a hospital setting is billable, Ziemba says.
Recognizing critical care in rehab settings. "I noticed that physicians spend a lot of time with spinal and head injury patients. I made them aware of that time, documenting time in and time out on the floor instead of [just] in their offices. Unit time is billable. That enhanced their revenues, but it also made them more aware of critical care time.
"Many physicians mistakenly believe that critical care codes are only for a critical care unit, but they can be used anywhere in the office, on the floor, even on the sidewalk." For example, primary care physicians treating a patient with a strong allergic reaction to bee stings these cases call for a critical care code, not an office visit. "When patients say they can’t breathe and you have to give them oxygen, that’s critical care," she says.
Returning to the ideas of Frederick Taylor, the time management industrial engineer. Just as early American industrialist Taylor measured the actual steps and time it took to perform jobs in manufacturing processes, coders can record actual time and effort involved in physician work, Ziemba recommends. Follow some physicians around and record time spent on particular activities, then step back and look at how these should be coded, Ziemba says.
This is how the resource-based relative value scale (RBRVS) was developed for Medicare’s Part B fee schedule, and it lies at the heart of how rehab coding for capitation is different from fee-for-service coding.
Typically, fee-for-service coding simply requires a "V" code for rehab care. Also, in California, as in many other states, when a patient is discharged following a spinal cord injury, respiratory distress, and many other complications and then re-admitted for rehab, regulations require a completely new medical record for the rehab experience. That’s OK in fee-for-service because the facility is then paid for that readmission. But in capitation, there’s no difference or repayment.
Including principal and secondary diagnostic codes. For capitation, the key is to re-enter all the diagnostic codes in the new record to reflect the patient’s condition. This allows you to show the link between stroke patients, for example, and the rehab care that they need, compared to hip fracture patients, spinal injury patients, cerebral palsy, brain damage from drowning, and other conditions.
"We grouped the records of all the patients in these different categories, and in a year’s time we can determine how much it really did cost by having documented the physicians’ time, critical care time, phone calls, and family conferences," she says. "This way we could come up with an accurate dollar amount for intervention for that patient." This provides actual cost data to use in negotiating a capitation contract. If you haven’t done this, you are at the mercy of what the capitation payment allows, which often isn’t enough for rehabilitation.
Predicting risk among patient groups. "Then based on a year’s experience, we could predict what the chances were of getting those [types of] patients and how well the capitation payment covered those risk groups." That’s the key to capitation predicting risk.
At this point, the insurer has to determine the payment scenario. In many cases, insurers opt for carve-outs for rehab care. "You never know for sure the extent of effort that would be needed to bring a patient back to health," Ziemba points out. "There is a real range. The top end was astronomical, whereas children tend to recover faster [and consume fewer resources].
Ironically, Ziemba got her ideas from HMO officials. She took an evening introductory course offered to the public on managed care at the University of California, Berkeley. "I took it just to see what HMOs are telling people," she says. "One question that came up was, How do you determine how much it costs to insure patients?’ They look at utilization patterns. If they do that, why can’t we do it, too? That’s where my idea came from."
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