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July is a busy month for medical coders and billers because so many CPT and HCPCS Level II code changes are implemented July 1. It’s hard to keep track of all the changes, but it’s essential that you do to ensure your coding/billing is correct. Here are several coding and policy updates you will need […]
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There is a lot of excitement about a new drug for women suffering from postpartum depression, but Sage Therapeutics’ Zulresso will present challenges for medical coders, their employers, and patients. First Postpartum Depression Drug Zulresso is the first drug developed specifically for postpartum depression. Often un or misdiagnosed, postpartum depression (F33.0), affects an estimated national […]
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Challenges and opportunities in data analytics
Healthcare organizations have become mass gatherers of data. But without sophisticated analytics, integrated IT tools, and processes to mine that data, they may not be able to take advantage of it.
The 33 leaders who gathered for the HealthLeaders Media Revenue Cycle Exchange, held March 23?25 at the Fairmont Grand Del Mar in San Diego, discussed some of the challenges and opportunities they’ve identified within their organizations around data analytics, as well as the tools that help them maintain an effective revenue cycle.
Let the data do the talking
Popular wisdom says culture starts at the top?but data is another important catalyst for change. The ongoing managed Medicaid expansion is requiring organizations to collect more prior authorizations and precertifications, presenting a challenge for revenue cycle leaders. Changing the culture of the organization is often key to handling that challenge, and one way to make the change is through data, says Jane Berkebile, MA, CPAM, system vice president of revenue cycle for OhioHealth in Columbus.
One significant challenge for OhioHealth is educating physicians about the increased need for preauthorizations under managed Medicaid. In the past, many of these patient accounts were written off as charity care. However, Berkebile’s organization now needs to focus on the administrative requirements around Medicaid.
Educating OhioHealth’s 343 physician practices, as well as the employed specialists and primary care physicians, by showing them the importance of preauthorizations, has represented a change in culture.
"For communication with our physicians, clinicians, and administration, the best tool we have is to show them in the data what’s really happening," says Berkebile. Her organization’s data analytics team drills down to the information that impacts each department. Departments usually see the gross charge number and think they are doing well, she says.
However, if a department is not getting appropriate authorizations, it may not actually be getting paid that amount. Berkebile finds physicians in particular react positively to seeing data.
"If you show them the data and don’t preach to them, and let them discover the problem, you can get more positive reactions from the physician community," she says. Following the data trail can also help you avoid pitfalls, such as relying on anecdotes that may hide the actual problem.
"The tyranny of the anecdote will not be allowed in this organization," says Doug Robison, performance improvement leader for John Muir Health in Walnut Creek, California. "You have to back it up with data."
Turn data into information
Even data only goes so far?it needs to be turned into information, says Russ Weaver, vice president of revenue cycle/finance for Adventist Health System in Burleson, Texas, relating advice he once received.
"You will be more successful if you figure out how to turn data into information. When you’re given something, ask, ‘What does this tell me?’ "
It is important to get back to the root cause and have a sufficient level of detail to address change. As part of the transition to the Cerner Patient Accounting product, Adventist has taken the opportunity to review its processes and reporting. As part of this, Weaver is careful to avoid relying on anecdotal information.
"You can’t go to the director of patient accounts and say you think his or her department is doing something wrong without having meaningful data to back it up," he says.
Sometimes what seems like a data problem is really something else, so it’s important not to lose sight of the basics, such as whether your organization is collecting required data on the front end, according to Doug Brandt, CPA, associate chief financial officer for Truman Medical Centers in Kansas City, Missouri.
"We’re focused on capturing the data items that need to be captured. There is always some low-hanging fruit, so identify and fix that first, then move to the harder-to-fix items," he says.
For example, it is important for revenue cycle leaders to look at the root cause of things such as denials. Even if you are measuring all the right things, if something is not happening at the front end (for example, the registration department is not verifying the patient insurance), you are going to get denials. UnityPoint Health in Des Moines, Iowa, is using data to get to the root cause of denials.
"We’re using data to drive that change by having the service providers focus on getting it correct at the beginning, versus always having to do it on the back end," says Renee Rasmussen, CPA, MBA, FHFMA, vice president of revenue cycle for UnityPoint Health.
Ensure ‘clean’ data
Organizations that can’t trust their data might run into problems with data standardization. Alternatively, organizations can fall into the trap of having too much data, but not enough accountability. The first step to ensuring clean data is to assemble a group of stakeholders to determine what data is necessary and where it will come from, says Tammy Thomlison, chief revenue cycle officer for the University of Mississippi Medical Center in Jackson.
Her organization has set up a team to look at the data warehouse generated by Epic and agree, organizationwide, where they will pull data from.
"As an organization, we had to decide where we would pull certain information from the data warehouse, so that when we’re pulling reports we all get the same results," says Thomlison. Her team also uses the Qlik software to provide reporting options on top of the data warehouse. Having data in multiple systems and managing various interpretations of that data is a challenge for many organizations.
Systems must also ensure the data is clean once they have it, says Don Shaw, vice president of revenue cycle for Baton Rouge (Louisiana) General Medical Center. "Once you start pulling information, you find that sometimes you have surprises that you have to fix."
Revenue cycle leadership must hold itself to the same accountability standards it hopes to see from other departments. Data transparency is one way to increase collaboration and trust between the revenue cycle and clinical departments.
"I think it goes back to making sure our data is as accurate as possible. If other departments find differences or errors, we acknowledge that and go back and make those adjustments," says Rasmussen.
Measure the right things
The University of Chicago Medicine focuses more on internal benchmarks than external.
"Your benchmark is what you did last week. Now do better than that," says Charlie Brown, MBA, vice president of revenue cycle for The University of Chicago Medicine. "To really set those individual targets, you’ve got to measure against your own internal performance."
UnityPoint also focuses on internal benchmarks, but supplements them with HFMA’s MAP App, says Rasmussen. "We look at the key performance indicator of net revenue yield for our nine regions to really compare different areas."
The most important thing is to set your own benchmarks and targets, adds Berkebile. "By looking at your data and seeing where you are, you see the opportunities and continually set targets to improve your own data. We don’t try to match somebody else’s number?we continually work on improving our own performance."
Organizations need to avoid the pitfall of measuring the wrong things or being so inundated with data that they can’t make a decision.
"There are an endless number of things we can measure, and you don’t want to be playing a game of whack-a-mole where every time something pops up, you hit it and then another thing pops up," says Brandt. "It’s important to find the balance and identify where we need to drill and what we need to focus on."
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By Shelley C. Safian, PhD, RHIA, CCS-P, COC, CPC-I, AHIMA-approved ICD-10-CM/PCS trainer
Overcome billing and coding challenges for comprehensive observation services
by Janet L. Blondo, LCSW-C, MSW, CMAC, ACM, CCM, C-ASWCM, ACSW
Billing correctly for observation hours is a challenge for many organizations. Getting it right requires knowing how to calculate observation hours for each patient, which is far from straightforward.
According to CMS, observation hours start accruing not when the patient comes into the hospital, but when the physician writes the order for observation. Observation hours end when all medically necessary services related to observation are complete. In some cases, this means that you can still bill for time spent completing the patient’s care after the physician writes the discharge order.
For example, a physician comes in to see the patient at 7:30 a.m. and writes the discharge order, which states discharge will occur pending the completion of tasks X, Y, and Z. The nursing staff finishes up those three tasks and the patient is finally ready to leave the hospital at 11 a.m. The hours between 7:30 a.m. and 11 a.m. are potentially billable observation hours because they were used to complete the patient’s medical care. Observation hours therefore end not with the discharge order, but with the completion of medical services.
In addition, because observation services are considered a temporary period to aid in decision-making, CMS states in the Medicare Benefit Policy Manual that only in rare and exceptional cases should observation services last more than 48 hours.
If a case reaches the 48-hour mark and the physician still hasn’t made a decision to discharge or admit the patient for inpatient care due to instability or risk of an adverse event if discharged, nor has any documentation made a compelling case for the need to continue observation, the services no longer meet the definition of observation care and the hospital should not bill for future hours. Hospitals should also not report observation hours after the physician has decided to send the patient home or to a lower level of care if the patient is receiving no active treatment and is just in a holding pattern until he or she moves to the next level of care or goes home.
Coding for comprehensive observation services
The 2016 OPPS final rule implemented changes for coding and billing for observation services. Among the changes made by CMS was the creation of a new comprehensive APC (C-APC) for comprehensive observation services.
Specifically, hospitals will now bill all qualifying extended assessment and management encounters, including observation services, through the newly created comprehensive observation services C-APC code 8011. A new status indicator, J2, was also created to specify that more than one service was provided.
CMS now requires hospitals to bundle services provided and previously billed separately?services such as level 3 ED visits, IV infusions, echocardiograms, speech therapy, and similar services. CMS pays a flat rate for the comprehensive observation services, which includes the bundled services.
Hospital staff should bill all hours of observation for a single encounter on one line under revenue code 0762. If the hospital provided observation care to a patient over multiple days, the date of service should be the date that observation care began. Although one rate is now paid for comprehensive observation services, HCPCS code G0378 is still used to bill observation services by the hour. When using this code, the organization should round to the nearest hour. For example, eight hours and 20 minutes in observation would round to eight hours, whereas nine hours and 40 minutes would round to 10 hours. If the hospital provided observation care to a patient over multiple days, the date of service should be the date that observation care began.
The second HCPCS level II code for observation is G0379. This code is used for a direct admission or referral for observation care from a physician in the community. Note that this code is not used if an ER physician or a physician from a provider-based department or clinic makes the referral. This code previously allowed hospitals to bill for costs associated with the visit, including registration and collecting clinical information about the patient, but costs are now bundled with the payment for the comprehensive observation services.
Claims that meet the following criteria will be paid under C-APC code 8011:
Services must be provided the day of or one day prior to the date of service for the following visit codes:
Hospitals can no longer bill separately for observation if these services are required after an outpatient surgical procedure. If a patient meets criteria for observation monitoring after the standard surgical recovery period, the hospital can place him or her in outpatient observation, but the cost for the observation care will be bundled into the payment for the surgical procedure.
Although hospitals are not paid separately for ancillary services under C-APC code 8011, all ancillary services received are reported on the claim under their corresponding HCPCS codes. Use the revenue codes corresponding with their related cost center, such as the following:
Under Medicare OPPS policies, outpatient therapeutic services in hospitals and critical access hospitals must meet the following requirements:
Grasping the complexity of carve-outs
Sometimes, observation billing requires organizations to also have a grasp of what not to bill or, more specifically, how to carve out nonreportable services. This might include time the patient spent in imaging for a CT with contrast when he or she was monitored by other clinical staff. The same would be true for any other service that includes active clinical monitoring, such as chemotherapy or a blood transfusion.
If your organization isn’t clear whether a service falls into this category, ask your Medicare administrator what type of services it considers to be monitored and should thus be subtracted from observation time.
CMS includes the following two options for calculating these carve-outs for observation time:
Whatever process your organization uses, it’s likely that it will be a costly investment because these carve-outs require staff members to look at medical records to calculate this time, adding to the cost of care. With a bundled payment for comprehensive observation services, it may be most cost-effective to adopt a policy of automated calculation of carve-out time for monitored services.
Ensuring proper patient status
In addition to ensuring that these requirements are met, it’s also important to ensure that patient status was determined accurately. Sometimes, patient status is not correct, and the problem needs to be addressed using condition codes 44 or W2.
If a patient is insured by Medicare, the hospital will need to file a change of status using condition code 44 if the patient has not yet been discharged from the hospital. However, if the patient’s status was found to be inaccurate after he or she was discharged, the hospital can use condition code W2 to change the patient’s status.
Condition code 44 is most often used when the utilization review (UR) committee determines that a patient wasn’t assigned to the correct status or no longer meets inpatient status criteria. To use the code, the following must be true:
The UR committee notifies the hospital, the patient, and the attending physician in writing of its decision that the admission does not meet inpatient criteria no later than two days after the determination. Documentation should indicate the reason for the determination, as this information will assist coders. The patient may be placed in outpatient observation with the agreement of the attending physician or with the concurrence of at least two physician members of the UR committee. Physician concurrence of patient status must be documented in the chart along with who was involved with the change in status, why the change was made, and what care was provided to the patient.
The order for outpatient observation cannot be backdated, but the entire episode of care will be billed as an outpatient episode using bill type 13X or 85X, reporting condition code 44 on the UB form in one of the Form Locators 24?30, or electronically in Loop 2300, HI segment, with qualifier BG on the outpatient claim (CMS, Medicare Claims Processing Manual, Section 50.3, Chapter 1, 2015). The hours the patient spent in an inpatient bed prior to the order change to observation can be submitted on the outpatient claim using revenue code 0762.
If not all of the criteria are met to initiate condition code 44, the hospital uses bill type 12X for covered "Part B only" services provided to the patient, such as diagnostic lab tests, radiology services, surgical dressings, and some other services listed in the Medicare Benefit Policy Manual.
If the UR committee determines after the patient has already been discharged from the hospital that the patient’s stay as an inpatient was not medically necessary, it’s important to self-deny the claim and resubmit it for payment under Part B Medicare. If the claim is not self-denied, it is likely that a Medicare Administrative Contractor (MAC) will deny the hospital’s inpatient claim under Medicare Part A as not medically necessary. In this instance, if the hospital agrees and does not plan to appeal the decision of the MAC, it can resubmit the claim for payment of any eligible services under Medicare Part B. This can be done using condition code W2, which may also be referred to as Part A to B rebilling.
Part A to B rebilling must be submitted using a 12X or 13X type of bill within one calendar year of the "through" date of the original Part A medical services. The form must include condition code W2 along with the treatment authorization code A/B rebilling (see MLN Matters MM8445).
The rules regarding observation billing can be complicated, so it’s important to audit and monitor billing regularly to ensure compliance.
Editor’s note
Blondo is the manager of case management at Washington Adventist Hospital in Takoma Park, Maryland. This article is an excerpt from HCPro’s Observation Services Training Handbook. For more information, see www.hcmarketplace.com.
