Access managers’ proactive approach to coding can save hospitals millions
Access should take lead in eliminating coding errors
Is your hospital losing millions of dollars in revenue or risking accusations of fraud because point-of-service diagnosis codes often entered by access employees who lack proper training don’t match the patient’s final treatment? It’s very likely, according to Jack Duffy, FHFMA, corporate director of patient financial services at ScrippsHealth in San Diego. He says stricter auditing procedures at three of his system’s six hospitals have increased collected revenue by more than $2 million in less than a year.
"We surveyed over 20,000 ambulatory surgery bills and determined there was $300 to $500 worth of missing reimbursement on each of those bills," Duffy explains. "The chief reason is that the codes created in medical records are more extensive than those put on the bill."
Although codes for those additional services are added to the bill later in the cycle after the operating summary is added to medical records they are listed on another line, not the one for pricing. "When the insurance company reads [the bill], it’s looking at the single items posted through the intake process not reacting in a financial way to the fact that three services, not one, were performed."
Meanwhile, Medicare, Medicaid, and other third-party payers are using increasingly sophisticated programs to look for inconsistencies between codes entered at first contact and those that later become part of the medical records abstract, Duffy says. Inconsistencies will be questioned, he warns, leading to an increase in third-party scrutiny that can delay payment by several months and require your hospital to submit complete medical records to clear up the confusion.
The fact that outpatient volume is increasing and staffing is often kept to a minimum contributes to the problem, says Tammy Laitala, team leader of registration at Lake Forest (IL) Hospital. Whereas before there was often an extra person to handle coding tasks in the various departments, those staffs are now smaller, and access staff are being asked to handle those tasks. With technicians doing their own scheduling and a reduction in clerical support in X-ray and cardiopulmonary services, for example, those ancillary departments "are no longer getting diagnosis codes for us," she says.
Generic codes don’t match diagnosis
As a result, access personnel, who aren’t trained as coders, are put in the position of "trying to pull the right diagnosis code of the patient," Laitala says. Because they lack the clinical training to ask the appropriate follow-up questions, the result is often a generic code that’s too broad and doesn’t match what the physician’s office submitted as the diagnosis.
But getting that information from the physician’s office is a headache, she adds. "Patients often come [for treatment] on their lunch hour, and we can’t reach the doctor’s office, or, with the pressures of managed care, the [physician’s] staff is under such a burden to give out referral and precertification information, they don’t want to take the time to pull the chart."
So the cost to the hospital comes not only from denials of payment, she says, but from the hours spent researching mistakes. "You need a letter from the doctor if [payment is] denied, and a lot of rework ends up being done."
What’s worse, the federal government has shown an increasing tendency to criminalize the type of errors that used to be classified as mistakes, Duffy says. Before, the worst that could happen was the hospital would be asked to correct its practices, or with a particularly flagrant violation, to submit a written correction plan.
In today’s stricter compliance environment, he says, "the code may come back two years from now with the FBI attached, saying it’s a fraudulent code and asking, ’Where’s the order for this service? Why did you do an EKG? Why did you draw this blood? Are you doing this on purpose to confuse the fiscal intermediary or to commit fraud?’"
Duffy’s solution sounds expensive but is actually cost-effective, he says. "The answer is to wait to put prices on a visit until after the medical record is complete change the sequence in which events occur." That happens now at three of his organization’s hospitals, and there are plans to extend the practice throughout the system.
"After the medical record is complete, a mini-audit is done, and we add anything that needs to be added," he says. If investigators come calling during a random audit, the bill will "match perfectly. They’ll say, We’ve never seen that before; we’re going somewhere else.’"
Working with the complete record
What makes the practice so cost-effective, he says, is that if the hospital is due $1,500, it will be paid that amount, not some fraction of it.
An added benefit to working with a complete record is that other "holes in the bucket" become apparent, Duffy notes. "For example, in the case of a laser eye surgery, we discovered a staff person who told us she was too busy to document the charges for pharmacy. This resulted in a $300 reduction in payment."
Duffy says he believes it’s the responsibility of the access department to reconcile the differences between the charges captured on the bill and the procedures that are coded in the medical records abstract, unlike the traditional approach to patient accounting.
He suggests hospital information management departments perform a regular review of the accuracy of billing codes and be responsible for creating training programs to improve the skills of access workers. (For a sample review form, see insert.) Everyone’s working with the same bill, he says, "and to manage a company in silos is not in the [organization’s] best interest."
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