We all know coding is a complicated process. The process starts with the provider’s documentation matching the services performed. Then, the all-important process of coding for what was documented takes place. This process can be very intricate since there are many things to consider impacting payment. Just to name a few, here are some important pieces to consider:
1. The correct evaluation and management (E/M) level must be considered. Determining the level is based on the documented components of the history, exam, and medical decision-making. Also considering whether you should report a new patient visit code or an established patient visit code can be difficult.
2. Were there additional services that must be coded? Knowing whether there is a code for your additional service or if should it just be considered part of your E/M level. These additional codes come from CPT (Current Procedural Terminology) or HCPCS (Healthcare Common Procedure Coding System).
3. Diagnosis coding to the highest specificity is more important than ever. You should always code to accurately reflect the clinical documentation and to the highest specificity possible. ICD-10 was implemented in part because of the higher degree of detail that it allows to describe the services you provide. Avoid unspecified ICD-10 codes when documentation supports a more detailed code. You will want to check the coding on each claim to make sure it aligns with the clinical documentation.
4. Modifiers play an important role. They are the road map for carriers that explain the service just a little bit more. They explain extra information about how, where, what, and why a procedure or service was performed.
5. The number of units to bill is important, especially with injectables. For example, Kenlog’s code description is “Injection, triamcinolone acetonide, not otherwise specified, 10 mg.” Many times, this drug is given in 40 mg dosages. Therefore, it is appropriate to capture four units of this drug on the claim form.
6. Consider your fees and your chargemaster. The chargemaster is the electronic list of all services, procedures, and supplies charged to the payers. Have you looked at your fees lately, and are they in the appropriate range? Reviewing your fees annually is an important thing to remember. Regarding the chargemaster, it is important to inactivate codes that have been deleted so those do not get submitted on the claim. This is a sure denial for any payer. As you can see, the coding process is vital to whether a claim is paid or denied.
The industry average for denial rates is anywhere from 5 to 10 percent. Therefore, establishing an internal process to identify and correct any mistakes prior to claim submission will decrease denial rates and produce a healthier cash flow. The average cost to rework an outpatient denied claim is approximately $25. Reworking a claim is a huge waste of time, so coding correctly is very important.
The first step in reducing the industry average of denials is to be prepared, annually on Oct. 1 the ICD Coding updates go into effect. When these codes are published, it is best to review the list, determine which codes will impact your practice, and train your staff on the updates. The CPT codes are updated on Jan. 1 of each year, along with HCPCS. You will not want to forget to update your chargemaster and charge documents. Don’t forget about all of the coding “reference tools” that you have created, hung up, and taped to your desk.
Have you also experienced a downcode by the carrier? A downcode, in a way, is a denial of the code you submitted. It is the alteration of a code by an insurer or other third-party payer of service to a code of lesser complexity, resulting in decreased reimbursement. The typical scenario occurs when a practice submits a claim (for example, a new patient visit code 99204), and the insurer automatically “downcodes” the claim to a lower level (for example, new patient visit code 99203). Then, the insurer reimburses at a lower rate. Typically, the provider receives no explanation for the change but simply receives lower reimbursement.
It is your responsibility to determine why the downcode occurred. The practice of downcoding claims is another important reason for providers to ensure the medical record supports the level of services in the documentation and on the claim. Any appeal of a claim that has been downcoded will require the submission of supporting documentation from the medical record.
The overall goal is to have appropriate documentation of the service provided and to accurately code for those services. Utilizing your coding tools and understanding the coding rules will reduce errors and mistakes that lead to these claim denials.
