Coders Can Help Avoid the ‘Red Flags’ that Signal Fraud

Coders Can Help Avoid the ‘Red Flags’ that Signal Fraud


Coders Can Help Avoid the ‘Red Flags’ that Signal Fraud

Melissa Stegman

All reimbursement management staff must take responsibility for the total ‘life cycle’ of the codes generated.

Over the last few years, hospitals and other providers have paid millions of dollars to settle charges of Medicare fraud and abuse. It’s an understatement to say that these investigations have become rampant in the health care industry.

Most hospital coders believe the jobs they do are a safe distance from such investigations. However, the truth is that fraud investigators often scrutinize the data generated by coders. They look for “red-flag” issues that may indicate improper coding and/or billing practices. Several of these, and how coders can avoid them, are summarized below.

Target Pneumonia Cases
One specific example of the type of information that has come under review is the number of cases that fall into DRG 79 (respiratory infections and inflammations, age > 17 with CC) and DRG 89 (simple pneumonia and pleurisy, age > 17 with CC).

Investigators have uncovered the fact that many claims include inappropriately assigned code 482.9 (unspecified bacterial pneumonia). Including 482.9 on the claim would group the cases to higher-weighted and, therefore, higher paid DRG 79. Investigators evaluate the total number of cases that include code 482.9 as the principal diagnosis in addition to the total number of cases in DRGs 79 and 89.

According to one attorney who works with hospital managers involved in investigations, most facilities have no more than 34 percent of their total pneumonia cases in DRG 79. To ensure this, track, on a monthly basis, the percentage of pneumonia cases being reported. Be alert to recent fluctuations in case mix index (CMI) that relate to pneumonia-related coding patterns.

Watch the 72-Hour Window
Medicare regulations indicate that if a patient is seen as an outpatient for the same condition within 72 hours of an inpatient admission, hospitals must bill the accounts together. The outpatient charges will be considered part of the inpatient charge.

In spite of this clearly stated regulation, hospitals continue to violate the 72-hour window. Although the admissions staff should catch most of these cases, some slip through the cracks. Fortunately, many health information management (HIM) abstracting systems include a screen with all patient visits displayed, and coders are in the perfect position to spot these violations. Before abstracting any codes, check to ensure that no other accounts within the 72-hour window are displayed. Route any accounts found to either the coding manager, HIM director or billing manager.

Verify Documentation
Billing personnel often contact HIM staff to verify codes. When this occurs, pull the patient’s chart and verify that the documentation supports the codes assigned. Never confirm or supply codes without first determining this.

Although members of the billing staff are responsible for completing and submitting claims, it is the coding staff who must take responsibility for all codes assigned.

Adopt a Team Approach
Staff from the coding, billing and patient accounts departments must work together. Communicating frequently helps to resolve billing problems that relate to code selection. Proactive cooperation can prevent many inappropriate practices and inaccurate claims submissions.

Coding staff may want to track calls from billers for a specified period of time, say for a month, and classify the types of questions received. Some may relate to coverage, and these should be referred back to the billing department or patient accounts manager.

Also, ensure that everyone in the facility who assigns or works with codes has a copy of and understands the American Health Information Management Association’s (AHIMA) Standards of Ethical Coding. Several of these are listed below.

  • Review the medical record thoroughly then abstract the diagnoses present on admission, or diagnoses and procedures that occur during the current encounter—and only the current encounter.
  • Assess the documentation to assure that it adequately and appropriately supports the diagnoses and procedures selected for abstracting.
  • Do not change codes or code narratives so that the meanings are misrepresented. Do not include or exclude diagnoses or procedures because the payment will be affected. Strive to maintain a quality clinical database.
  • Clarify conflicting or ambiguous documentation with physicians.
  • Assist physicians who are unfamiliar with ICD-9-CM, CPT or DRG methodology. Suggest resequencing or including diagnoses or procedures when needed to more accurately reflect the occurrence of events.
  • Strive for the optimal payment to which the facility is legally entitled, but remember that it is unethical and illegal to maximize payment by means that contradict regulatory guidelines.

Look at the Bigger Picture
Coding managers should run case information monthly by principal diagnosis, DRG and CMI. This data should be shared with coders, and they should be encouraged to take an active interest in the aggregate data.

If possible, run reports for outpatient case data. Review the most commonly performed procedures by CPT code, and track other cases by principal diagnosis code. Becoming accustomed to this type of information now will make analysis for ambulatory patient groups (APGs) much easier when implementation begins for hospitals in January of 1999.

Check on Systems
Do regular “reality checks” on your facility’s data to ensure that all systems are compiling information appropriately and that the data “makes sense.”

For example, suppose the number of coronary artery bypass graft procedures drops by half in a particular month. Is it due to system problems? Or is it a result of the cardiovascular surgeon taking an extended vacation that month?

Familiarity with data trends will help you to forecast other changes, such as CMI fluctuations. Interpreting and presenting conclusions based on data will become more and more important in HIM.

If possible, run comparison reports from your billing system, particularly for outpatient cases. In many hospitals, tremendous discrepancies exist between the codes that HIM coders have assigned and those that appear on the UB-92 claim forms. Unfortunately, these discrepancies may be due to claim “manipulation” by billing staff. Often, they change or resequence codes to pass claim edits without the knowledge of anyone in the HIM department.

Take Responsibility
By following the above suggestions, coding staff can help reduce the red flags that attract the interest of government and third-party payer investigators.

Being buried in the day-to-day tasks, such as keeping coding current and accounts receivable down, is simply not enough in our current health care system. All reimbursement management staff must take responsibility for the total “life cycle” of the codes generated.

* About the author: Melinda S. Stegman is a senior health care consultant with Medical Learning Inc. (MedLearn), St. Paul, MN. Her expertise includes CPT and ICD-9-CM coding, DRG validation, reimbursement and HIM issues.

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