Billing Correctly for 21st Century

How do you know you’re coding properly?

First and foremost, if you had to ask this question, you may have a problem. The world of billing and coding changes each week. Doctors go to seminars to learn how to increase reimbursement, while insurance employees are taught how to deny payment. What a paradox. The best way to win at the “coding Game” is to be good at it. You should attend seminars, do your homework, fight denials and work your Explanation of Benefits (EOB’s). Are you the victor or victim? You decide. You must take a position. Vince Lombardi, the legendary football coach, once said, “The object of the game is to win—fairly, squarely, by the rules—but to win”

Let’s play by the rules and let’s get paid.

A Tool for Analyzing Your Coding

Physicians and managers too often carve out procedure coding from the rest of financial management, like it’s a discrete, independent activity. But how can a business justify separating its billing from the rest of its finances?

It can’t. Applying sound analysis to your coding history may expose over- and under-coding problems, each of which has its own effect on your practice finances.

The well-publicized threat of compliance hassles and possible fines nudges many physicians toward down-coding services. But that means giving up reimbursement you’ve rightly earned. Then you must know that the Office of Inspector General also does not accept downloading. Know the rules; go to Are you compliant? Do you have a compliance officer? Do you subject yourself to routine, annual, independent audits? Well, you should. The more revenue you produce, the larger the target on your back.

“Where do I begin?” you may ask. Stay on the proper “middle path” by occasionally checking your Evaluation & Management (E&M) coding against national benchmarks. You can compare your practice to national averages with a bell curve analysis. There are many publications that offer fee and regional analysis. Apply for and acquire one of these publications. Fee Facts and Chirocode are two simple but effective tools. When you are not sure, contact the insurance company. The Freedom of Information Act mandates they provide you with their prospective fee schedule.

What about the Size of My Practice?

The OIG provides documentation and guidelines for any type of practice. Any size practice can use this tool. If you practice in a group, you can compare its individual providers. Do you know the Stark definition of a group practice? Know your Stark Laws. It stuns me how many integrated MD/DC or DC/PT practices do not know the Stark Laws, yet they must comply.

Knowing the rules raises physician awareness and promotes accountability within the group. It will, hopefully, improve coding, helping ensure compliance, while reducing the likelihood of “leaving money on the table.” I have found, the more rules you know, the more compliant you are, and the more money you can ethically make.

By meticulously gathering and analyzing data from the Centers for Medicare & Medicaid (CMS), we can create a table of E&M codes. It shows how frequently providers submit each code for reimbursement—on a national basis. The resulting graph is a bell-shaped curve, because mid-level encounters are more common than brief or highly complex ones.

Over, at least, six months, your E&M coding levels should approximate the national picture—unless your practice specializes in specific care that would skew your coding.

Is Average Good?

When it comes to benchmarking E&M codes, “average is good.” If your E&M coding curve resembles national averages, you’re less likely to draw regulatory attention. Significant outliers catch the eye of any regulatory inspectors and commercial auditors, and that can be troublesome unless you really handle many more complex cases than most physicians in your specialty.

When we apply any bell curve study in a client’s practice, we begin by collecting data from its billing system. We study reports showing how many times individual providers used each of the five E&M codes. Using at least six months’ activity, we can then compare the curve for each code category (like established patient, new patient, office visit, hospital encounter) against CMS data.

Plotting the practice’s and CMS’s results on a line graph produces two bell curves that may dramatically demonstrate variations between an individual’s coding and national averages. Table 1 above compares a family practitioner’s 287 new patient visits against CMS’s statistics. The resulting bell curve analysis shows clear differences. Table 1 is clearly hypothetical, but let it remind you that an auditor can chart your practice. In table 1 you see new patients were treated with 99202 90% of the time. What if this were 99294? What if they stated that you billed the highest code for the highest reimbursement; is that ethical? The answer is no!!! You bill by time and medical necessity. Your note must reflect the quality and thoroughness of your exam.

The next step illustrates how the bell curve translates to dollars. Table 2 above compares how much D. Bones billed for those 287 office visits to what he would have billed, if his coding level reflected national numbers.

Again codes equal numbers and we live in a world of algorithms. If you do it, document it. If you document it, bill for it. Plain and simple.

Can You Spot Potential Problems?

This hypothetical analysis suggests that Dr. Bones isn’t fully documenting what he does. Or it may mean that he or his staffs are entering the wrong codes. It could even mean that the doctor is practicing differently than his peers. Negligence is no alibi.

The bell curve study, thus, focuses your attention to your coding and billing patterns. But, it fails to accomplish much, if you don’t do something constructive about the data. There is no right way to do the wrong thing. We live in a world of windows. Insurance companies are aware of your patterns: what you bill, what you code, how much your charge. Do it professionally, ethically. Do you have a health care consultant? A health care attorney? Seminars are great; go to as many as you can. Read this and other columns and be compliant. Don’t bill based upon reimbursement. Bill based on the services rendered. Know the codes, know the rules and you will sleep well at night and get paid in the morning.

Dr. Eric S. Kaplan, is CEO of Multidisciplinary Business Applications, Inc. (MBA), a comprehensive coaching firm with a successful, documented history of creating profitable multidisciplinary practices nationwide. For more information, call 561-626-3004.




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