June 2 , 2008
Coding Audits — Checking Your Work Can Improve Your Facility’s Bottom Line
By David Yeager
Vol. 9 No. 11 P. 14
A home inspection before selling a house. Purchasing insurance. A trip to the dentist. These are things that, however necessary, people generally don’t enjoy. For health information management directors, coding audits probably fall into this category. But while they may require extra manpower and paperwork, coding audits benefit healthcare facilities in several ways. Auditing provides organizations with the ability to analyze their coding operations in an effort to detect holes in the system.
Revenue Cycle and Regulations
Different facilities have different needs, but they all need a means of evaluating their coding processes. Whether it be to ensure proper reimbursement, track implementation of new procedures, or provide documentation to government agencies, coding audits let management know which areas of the process require the most attention.
Presbyterian Healthcare Services in Albuquerque, N.M., which oversees seven hospitals, conducts audits in a variety of areas. “We do professional fee audits. We have some facility auditors that audit inpatient records. We have clinical auditors that audit for clinical issues on the inpatient side and the observation cares,” says Mary Jo Carrion, RHIA, CCS-P, CPC, CPC-H, the enterprisewide coding training lead. “So we do documentation audits, coding audits, [and] charge capture audits. We have some people that work out of revenue management that do strictly charge capture audits and watch for what kind of money’s going through or falling through the cracks.”
“With the upcoming comparisons of physician CPT billing for procedures done in the hospital being compared for the hospital’s billing for those physicians’ procedures, it may well be indicated to perform an audit of comparative billing [professional and facility] and then evaluate, if there is a discrepancy, who needs education to get it right,” says Robert S. Gold, MD, the CEO of DCBA, Inc. in Atlanta.
Although a 90% grade may suffice in certain circumstances, Gold suggests a goal of 95%, with ensuing education if a deficit is determined. “And audits can provide that information,” he says.
“However, in certain instances, that goal can be elusive,” he adds. “Studies have shown, with the current E&M [evaluation and management] billing systems for physician professional services, it is lucky if double-blinded expert auditors can come up with a 40% concurrence.”
Coding audits can also help ensure compliance with new regulations, such as the Centers for Medicare & Medicaid Services’ (CMS) new requirement for present on admission (POA) indicators. As of April 1, hospitals that fail to include POA indicators will have claims returned to them. Because coding rules change so often, it’s important to track implementation.
Thinking in Ink
This type of information can also help providers focus on areas for improvement. Presbyterian has been surveying providers for the last few years to find out what they think about the health system’s coding audit process.
“They’re feeling that they’re being more complete, more safe, in documenting exactly what they do, thinking in ink instead of just thinking it in their head,” says Carrion. “We tell them to think in ink and write down everything they’re thinking so that their thought processes are there. We try to convey to them that they need to let us know exactly what they’re thinking about how sick the patient is because if they don’t write that down, we can’t assume.”
Presbyterian’s coding department has allayed initial provider concerns about coding audits by keeping the lines of communication open. Carrion says building a rapport with providers has paid dividends. “So [providers] call us all the time,” she says. “The data entry people who are putting the codes in call us a lot and have questions [like] ‘What needs to happen with this?’ So we communicate a lot with these providers.”
Presbyterian also holds regular one-on-one and large group educational sessions with its providers. “It’s almost like the top five issues of the last year that caused us grief as coders, we go to the providers and ask for their assistance in documenting it correctly and selecting the codes correctly,” Carrion says. “So we do a training session that every provider in the system is mandated to go to. And most of them now are pretty willing and have lots of input for us and want to know more,” she adds. “When we first started, it was like, ‘Oh, you’re out to get me.’ And now they know it’s not like that at all, and they use us as a resource.”
In or Out?
An important consideration in the auditing process is whether to hire internal auditors or outsource the job. The decision largely depends on the organization’s needs and resources.
Presbyterian, which has more than 500 providers, finds it cost-effective to hire and train its own auditors to manage volume. “We audit all the providers at least once a year on their professional fees, broken up by quarters,” says Carrion. “In the first quarter, everybody gets the audit. Everybody gets five charts audited for diagnosis and for CPT coding because they do their own level of selection … so 10 items out of five charts. And then if they score higher than 90%, they have a bye for the rest of the year.
“If they’re between 80% and 100%, they get notification by e-mail. If they want a one-on-one meeting, they can have it, but it can be done all by e-mail at that point,” she adds. “And if they’re 70% or below, they have to have a one-on-one meeting with their auditor and then education on what they’re lacking and where they could improve. So we do at least 500, and then anybody below 90% gets another audit in the second quarter and then they kind of fall off during the year. If they reach 90%, that’s when we stop auditing them.”
Gold says other concerns sometimes prompt an audit. “And when it is because there may be some concern about the appropriate assignment of some code sets that can reflect on internal processes and procedures, it’s worth getting outside help,” he says.
“Hospitals and physicians are concerned about profiles—things like severity-adjusted mortality numbers (eg, RAMI [risk-adjusted mortality index]) or complication rates reported out to the public,” adds Gold. “In such circumstances, the coders blame the physicians, and the physicians blame the coders.”
Gold notes that with recovery audit contractors and patient safety indicators increasingly affecting hospitals’ and physicians’ bottom lines, an audit may be indicated when internal review or external report cards suggest that someone may have a problem. “If your hospital is reported as having too many ‘accidental punctures or lacerations’ or too many cases of ‘postoperative respiratory failure,’ it behooves the facility to bring in [outside help] to determine if the issue involves inappropriate documentation, inappropriate assignment of codes, or both,” says Gold.
“In this new era of data mining, with the complexities of the algorithms out there and the ways that insurance companies would prefer to utilize physicians and hospitals with good-looking statistics, stability of a practice and stability of a hospital in attracting market share may well depend on the evaluation of medical records, documentation, and coding practices to either validate that the numbers are, indeed, bad or someone is doing something inappropriate,” he says.
In an effort to identify the best candidates, Presbyterian conducts comprehensive auditor screenings. “We do entrance exams. We have coding CPT and I-9 tests. We have an Excel test because it’s a lot of tracking and documentation that we have to provide for education because it’s part of our compliance plan,” says Carrion. “We have to turn all this information over to legal and compliance so that they know that we’re training the doctors and that we are providing due diligence over all of these little particular areas.
“And we also do some abbreviation kinds of tests because a lot of the [people] that apply think they’re coders, want to be a coder, hope to be a coder, and then they don’t have the base knowledge of ‘What’s CMS?’ and ‘What’s the OIG [Office of Inspector General]?’—those acronyms that we watch for a lot,” she adds. “They don’t even have that. That kind of gives us a red flag that ‘Maybe you’re not ready for this.’”
Presbyterian places a premium on coding credentials and only hires auditors who have coding certification through the American Health Information Management Association or the American Academy of Professional Coders. “They should have between three to five years of experience in coding at least, but we look for—and of course it’s very hard to find—people that have audited before,” says Carrion. “So we’re at least going after certified coders, and then we’ll grow them into an auditor.”
But despite the challenge of finding capable auditors, the changing nature of coding regulations ensures that there will be plenty of opportunities for people with an interest in auditing and a willingness to learn the ropes. “Coders think they have to know it all to become an auditor,” Carrion says. “But you know, you just can’t know it in all the areas. So even if you’re specialized in one particular area, that’s pretty enticing to an employer. Coding’s too big to know it all, and it changes way too often.”
— David Yeager is assistant editor of Radiology Today.