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The Balanced Budget Act of 1997 changed the landscape of coding and reimbursement forever in the nation’s health care industry. Because of these changes, coders and HIM directors need to keep in mind three words: quality, quality, quality.
"It’s replacing a system in which you were basically reimbursed the cost of the care you provided with a system where Medicare says, Tell us what you did, and we’ll pay you a set dollar amount that is determined by those services you list on the bill,’" explains Dean Farley, PhD, MPA, vice president for health policy and research for HSS in Camden, CT. HSS is a software firm that specializes in developing tools to help health care providers and payers manage the reimbursement process. Farley was scheduled to speak about the dangers of poor data quality at AHIMA’s 73rd National Convention and Exhibit, held Oct. 13-18, 2001, in Miami Beach, FL.
"What this means is that if you don’t do a good job of getting codes on the bill, you’re going to lose money that you’re entitled to," Farley adds.
Here are some of the problems that lead to poor data quality, which ultimately could lead to financial and compliance problems:
Codes may come from encounter forms or a charge description master, and these sometimes are sent to billing without any information management from coders or HIM staff, Farley says.
"If that document is not up to date, then you could lose money, and one of the big challenges with the Medicare outpatient prospective payment system [PPS] is that changes to the classification of codes you can use are made on a quarterly basis," Farley explains. "And those changes are concentrated precisely in the kinds of codes that exist on the chargemaster."
This means hospitals will need to update the chargemaster continually, as opposed to waiting every two or three years as they might have done in the past, Farley adds. "If you don’t do it, you will lose money, and not an insignificant amount of dollars is at stake."
HSS consultants recommend to most larger hospitals that they retain an employee, whose title might be ambulatory payment classification (APC) coordinator, to manage and maintain the process to keep the hospital current with regulations for outpatient PPS, Farley says.
The person filling that role would be in charge of working with the clinical department and learning what information needs to be provided and which issues should be addressed.
For example, the APC coordinator might ensure that information from Medicare is being sent to the appropriate departments in the hospital on a timely basis so everyone is kept advised of coding changes, Farley says.
"One of the problems with code-based systems in general is that codes have to be supported by appropriate clinical documentation, and as soon as you move to this kind of payment system, there are compliance risks created for physicians and facilities," Farley says.
Staff should know which codes make a difference and which do not, and they need to know what questions to ask, he adds.
Since outpatient PPS was implemented, hospitals have had to deal with the quality issues that arise when codes are placed in a chargemaster, allowing clinical departments to drive the code assignment.
"The difficulty with that is unless documentation exists in the medical record to support the codes on the bill, then you have a compliance risk," Farley explains. "You could be billing and using codes that are not supported by the medical record."
While hospitals may find it tempting to load codes into the chargemaster, they should be wary of doing so unless they have a system in place with staff reviewing these codes and comparing them to medical charts, he concludes.
HIM staff should be trained to audit bills and codes, looking at whether documentation is provided, whether codes are correct, and what the process is for moving codes onto the bills.
"The best [training] models are the most expensive and involve bringing in experts to work with the clinicians — and not just physicians, but nurses and therapists too," Farley says.
Because of PPS, providers need to put additional information on bills, and the Centers for Medicare and Medicaid Services in Baltimore has imposed substantial new reporting requirements, Farley says.
"So it’s unrealistic to expect staff to do more with the same amount of staff," Farley says. "Certainly new tools will help and working smarter will help, but I think it’s inevitable that some additional staff will have to be hired, and providers will have to understand that it’s really an investment they’re making in their revenue stream."
Decision support tools come in a variety of forms, Farley notes.
For example, suppose a provider is negotiating a series of managed care contracts. The obvious way to handle it is to take a look at caseload in the claims that will be covered and simulate various contract scenarios, Farley suggests.
"But if the data are suspect, then the decisions you make will be suspect because they’re based on poor data, and the financial decisions you make will not necessarily be accurate, again because you don’t have the information you need to make the correct decision," he explains.
The answer is to invest in the information management department, paying attention to the chargemaster and investing in various editors and automated end-coders that will assign those codes to make sure data are accurate and comprehensive, he adds.
"The No. 1 issue is to recognize the problem exists," Farley says. "You have to recognize that as you make data-driven decisions, you are continually asking questions of whether your data are adequate to support the kinds of decisions you are trying to make."
Also, administrators need to recognize the importance of investing in software, staff, and training to ensure codes are accurate and complete, Farley says. "You have to make those investments because it’s important not just for the revenue stream but also for solid financial and clinical decisions."