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Application Exercises 1. You are the CDM Coordinator at Anywhere Hospital. Answer the following questions about the IPPS new technology add-on payment items/devices for the new fiscal year. 1.1 When would these items/devices be incorporated into the CDM? 1.2 How would these items/devices be incorporated into the CDM? 1.3 Which departments/units within Anywhere Hospital would you provide educational sessions? 1.4 How would you explain the importance of the new technology add-on payment to various department/unit managers? 2. Read the article \"Diagnosis Coding and Medical Necessity: Rules and Reimbursement\" by Janis Cogley, located on the AHIMA Body of Knowledge (BoK) at www.ahima.org. 2 This article discusses how Medicare administrative contractors (MAC) use coverage determinations to establish medical necessity. When the condition(s) of a patient are expected not to meet medical necessity requirements for a test, procedure, or service, the provider has the obligation under the Beneficiary Notices Initiative to alert the Medicare beneficiary prior to rendering the service. The Medicare beneficiary is notified via the Advance Beneficiary Notice (ABN). The Medicare beneficiary may choose to complete the ABN and provide out-of- pocket reimbursement for the service, or may elect to not have the service performed. If the provider fails to alert the Medicare beneficiary with an ABN, then the facility may not balance bill the patient for the non-covered charges denied by the MAC. Scenario You are the revenue cycle coordinator for Anywhere Hospital. The decision support department at Anywhere Hospital is concerned because the volume of remittance advice remark code #M39 (The patient is not liable for payment for this service because the advance notice of non-coverage you provided the patient did not comply with program requirements.) on Medicare remittance advice logs has increased over the past three months. Further analysis of the denied claims shows that 75 percent of the claims have code 93798 (physician services for outpatient cardiac rehabilitation with continuous ECG monitoring) present. Therefore, they are requesting that the revenue cycle team perform further investigation for this issue. After auditing the remittance advice logs and medical records for a sample of cardiac rehabilitation claims, the revenue cycle team has determined that medical necessity is not being met for code 93798. Further, they have discovered that a new LCD was issued for code 93798 in October (three months ago). The only ICD-9-CM diagnosis codes that support medical necessity for code 93798 are 410.00-410.92 Acute myocardial infarction of anterolateral wall episode of care unspecified through acute myocardial infarction of unspecified site subsequent episode of care 412 Old myocardial infarction 413.0-413.9* Angina decubitus through other and unspecified angina pectoris V45.81 Post surgical aortocoronary bypass status * There is no specific code assigned to stable angina. Therefore, these codes should be used to identify stable angina and documentation should support that diagnosis. Further, around $20,790.00 has been written off due to ABNs not being issued for this cardiac rehabilitation service. 2.1 What went wrong in the revenue cycle? 2.2 How would you suggest rectifying this issue? 2.3 How will your team monitor improvements? 3. Review the following excerpt from the charge description master file at Anywhere Hospital. Closely examine the line items and identify and correct the elements that need to be updated or revised. ITEM CODE 12345 12347 12350 12351 12348 12346 12349 12352 12353 SERVICE DESCRIPTION BILIRUBIN TOTAL & DIRECT CHROMOSOME STUDY - AMNIOTIC FLUID SKIN TEST CAND TRANSCATHETER PLACEMENT.IVSTENT VESSLE CT CHEST W/WO ABD&PELVIS W/CONTRAST CATHETERIZATION URETHRA COMPLICATED OPERATING ROOM-III 1ST 30 MINUTES HOT/COLD THERAPY PT LEVEL 2 DRUG REVENU E CODE 310 CPT CODE PRICE 82251 300 300 320 86458 95960 $25.00 $0.00 $20.00 $1,125.00 352 360 360 430 250 53675 4. The executive finance team at Anywhere Hospital is reviewing charge levels for various surgical units. The team leader has requested a CDM management report from the CDM coordinator. She would like the report to include the Medicare reimbursement, cost, and profit for procedures performed during first quarter 20XX. Additionally, she would like thirdparty payer average reimbursement, cost, and profit for the same time period. Using the information in table 1 complete the data elements provided in table 2. Table 1 and 2 are also provided in Excel format. The average reimbursement rate for all third-party payers at Anywhere Hospital is 62 percent of billed charges. The outpatient ratio of cost to charge for revenue code 360 is 0.4043. The outpatient ratio of cost to charge for revenue code 320 is 0.5267. Is either of the payers profitable for Anytime Hospital in this outpatient surgical area? $1.00 $270.00 $2,267.00 $75.00 $3,000.00 Table 1 CHARGE CODE CODE DESCRIPTION CPT CODE REV CODE REVENUE AREA CHARGE MEDICARE VOL TPP VOL 49213 BIOPSY BREAST PERCUT W/O IMAGING GUIDANCE 19100 360 1137 826.80 58 115 49214 BIOPSY OF BREAST, OPEN 19101 360 1137 3944.25 37 76 49217 CRYOSURG ABLATE FIBROADENOMA, EACH 19105 360 1137 6059.85 21 32 49218 NIPPLE EXPLORATION 19110 360 1137 3944.25 12 14 49219 EXCISE BREAST DUCT FISTULA 19112 360 1137 3944.25 14 17 49220 REMOVEAL OF BREAST LESION 19120 360 1137 3944.25 76 87 49221 EXCISION, BREAST LESION 19125 360 1137 3944.25 45 90 49222 EXCISION, ADDL BREAST LESION 19126 360 1137 3944.25 36 54 49223 REMOVAL OF CHEST WALL LESION 19260 360 1137 3076.44 22 43 49224 PREOP PLACE NEEDLE LOCAL WIRE BREAST 19281 320 1196 65.00 43 98 49225 PREOP NEEDLE LOCALIZATION ADD'L LESIONS 19282 320 1196 65.00 10 65 49227 PLACE BALLOON CATHETER FOR RADIOELEMENT APP 19296 360 1137 10810.92 5 24 49228 PLACE BALLOON CATHETER WITH PART MASTECTOMY 19297 360 1137 10810.92 8 12 49229 PLACE BRACHYTHERPAY CATHETER 19298 360 1137 10810.92 10 32 49230 REMOVAL OF BREAST TISSUE 19300 360 1137 3944.25 21 68 49231 PARTIAL MASTECTOMY 19301 360 1137 3944.25 24 45 49232 P-MASTECTOMY W LYMPHADENECTOMY 19302 360 1137 7608.72 21 65 49233 MASTECTOMY, SIMPLE, COMPLETE 19303 360 1137 6059.85 18 47 49234 MASTECTOMY, SUBCUTANEOUS 19304 360 1137 6059.85 17 56 49235 MASTECOMY, MODIFIED RADICAL 19307 360 1137 7608.72 15 63 49236 SUSPENSION OF BREAST 19316 360 1137 6059.85 11 2 49237 REDUCTION OF LARGE BREAST 19318 360 1137 7608.72 9 12 49238 ENLARGE BREAST 19324 360 1137 7608.72 0 23 49239 ENLARGE BREASE WITH IMPLANT 19325 360 1137 10810.92 0 25 49240 REMOVAL OF BREAST IMPLANT 19328 360 1137 6059.85 5 13 49241 REMOVAL OF BREAST IMPLANT MATERIAL 19330 360 1137 6059.85 0 16 49242 IMMEDIATE BREAST PROSTHESIS 19340 360 1137 7608.72 0 34 49243 DELAYED BREAST PROSTHESIS 19342 360 1137 10810.92 17 27 49244 BREAST RECONSTRUCTION 19350 360 1137 3944.25 4 47 49245 CORRECT INVERTED NIPPLE(S) 19355 360 1137 6059.85 0 3 49246 BREAST RECONSTRUCTION 19357 360 1137 10810.92 6 25 49247 BREAST RECONSTRUCTION 19366 360 1137 6059.85 7 24 49248 SURGERY OF BREAST CAPSULE 19370 360 1137 6059.85 5 12 49249 REMOVAL OF BREAST CAPSULE 19371 360 1137 6059.85 6 9 49250 REVISE BREAST RECONSTRUCTION 19380 360 1137 7608.72 4 8 49251 DESIGN CUSTOM BREAST IMPLANT 19396 360 1137 6059.85 0 23 49252 BREAST SURGERY PROCEDURE 19499 360 1137 3944.25 2 1 Table 2 CHARGE CODE CODE DESCRIPTION CPT CODE MCR REIMB 49213 BIOPSY BREAST PERCUT W/O IMAGING GUIDANCE 19100 49214 BIOPSY OF BREAST, OPEN 19101 49217 CRYOSURG ABLATE FIBROADENOMA, EACH 19105 49218 NIPPLE EXPLORATION 19110 49219 EXCISE BREAST DUCT FISTULA 19112 49220 REMOVEAL OF BREAST LESION 19120 49221 EXCISION, BREAST LESION 19125 49222 EXCISION, ADDL BREAST LESION 19126 49223 REMOVAL OF CHEST WALL LESION 19260 49224 PREOP PLACE NEEDLE LOCAL WIRE BREAST 19281 49225 PREOP NEEDLE LOCALIZATION ADD'L LESIONS 19282 49227 PLACE BALLOON CATHETER FOR RADIOELEMENT APP 19296 49228 PLACE BALLOON CATHETER WITH PART MASTECTOMY 19297 49229 PLACE BRACHYTHERPAY CATHETER 19298 49230 REMOVAL OF BREAST TISSUE 19300 49231 PARTIAL MASTECTOMY 19301 49232 P-MASTECTOMY W LYMPHADENECTOMY 19302 49233 MASTECTOMY, SIMPLE, COMPLETE 19303 49234 MASTECTOMY, SUBCUTANEOUS 19304 49235 MASTECOMY, MODIFIED RADICAL 19307 49236 SUSPENSION OF BREAST 19316 49237 REDUCTION OF LARGE BREAST 19318 49238 ENLARGE BREAST 19324 49239 ENLARGE BREASE WITH IMPLANT 19325 49240 REMOVAL OF BREAST IMPLANT 19328 49241 REMOVAL OF BREAST IMPLANT MATERIAL 19330 49242 IMMEDIATE BREAST PROSTHESIS 19340 49243 DELAYED BREAST PROSTHESIS 19342 49244 BREAST RECONSTRUCTION 19350 49245 CORRECT INVERTED NIPPLE(S) 19355 49246 BREAST RECONSTRUCTION 19357 49247 BREAST RECONSTRUCTION 19366 49248 SURGERY OF BREAST CAPSULE 19370 49249 REMOVAL OF BREAST CAPSULE 19371 49250 REVISE BREAST RECONSTRUCTION 19380 49251 DESIGN CUSTOM BREAST IMPLANT 19396 49252 BREAST SURGERY PROCEDURE 19499 TPP REIMB MCR COST TPP COST MCR PROFIT TPP PROFIT 5. Identify five new CPT codes for the upcoming calendar year. Create a workflow to ensure that all data elements required in the CDM are identified, verified, and signed off on for inclusion in the CDM. Identify any compliance issues for these new CPT codes. 6. The health information management team at Anywhere University Hospital (AUH) contracted with an auditing firm to perform full assessment coding review. The results from this baseline assessment are provided in four tables: Variation Log by Type of Error Variation Log by Coder Variation Log by MS-DRG MS-DRG Relationship Assessment You are the inpatient coding manager at AUH. Your director has asked you to develop an ongoing review and monitoring schedule for the next year based on the results from the outside review. Include internal and external reviews, coding in-services, physician workshops, and external seminars/educational sessions that will be performed and or provided for your staff. The schedule should be specific (include volumes and/or percentages of charts to be reviewed). Keep in mind that on average it takes 18 minutes to review one inpatient chart. Budget provides for $65,000 for external reviews. The average cost for reviewing one inpatient record by an external review team is $55.00 (fully loaded). In addition to preparing the schedule, outline how you will maintain coding quality statistics and report them back to the HIM Director and Compliance Committee at your facility. How will you reward your staff members who show great improvements? How will you reward and/or recognize that your staff has made improvements overall? Your Coding Team consists of: Coding Manager (you) One Data Quality Auditor (1 FTE) Eight Inpatient Coders (8 FTE) 2=RHIA, CCS 3=CCS 3=RHIT Results of the full assessment coding review for AUH: Two audits were performed: 1.Coding quality review by MS-DRG 2.MS-DRG Relationship Analysis Variation Log by Type of Error % of errors Inaccurate sequencing or specificity principal diagnosis, 17% affect MS- DRG Inaccurate sequencing or specificity principal diagnosis, 16% non affect MS-DRG Omission CC, affect MS-DRG 33% Omission CC, non affect MS-DRG 2% Inaccurate principal procedure, affect MS-DRG 3% Omission procedure, affect MS-DRG 4% More specific coding of diagnosis or procedure, non affect MS12% DRG Inaccurate coding 5% Missed diagnosis or procedure code 8% Variation Log by Coder Coder Error Rate Standard Coder 1 3% 5% Coder 2 9% 5% Coder Coder Coder Coder Coder Coder 3 4 5 6 7 8 8% 2% 4% 16% 12% 3% Variation Log by MS-DRG* MS-DRG Volume Erro r Rat 2% 470 420 313 233 14% 392 232 1% 291 232 17% 247 220 3% 292 216 5% 871 213 12% 641 209 0% 194 195 3% 293 193 1% 885 188 3% 312 177 0% 191 175 7% 287 173 2% 310 171 15% 689 157 11% 603 143 2% 379 137 3% 192 131 9% 683 116 11% 189 114 1% 069 110 2% 190 92 12% 193 87 10% 690 76 4% 065 76 5% 195 72 2% 066 52 2% 064 41 5% 906 35 2% *MS-DRG descriptions provided below 5% 5% 5% 5% 5% 5% Variation Log by MS-DRG* Set MS-DRG Hospital % Nation % Set 064 24.3% 21.4% 065 45.0% 43.8% 066 30.8% 34.8% 190 191 192 23.1% 44.0% 32.9% 15.2% 33.5% 51.3% 193 194 195 24.6% 55.1% 20.3% 17.5% 54.2% 28.3% 291 292 293 34.6% 36.7% 28.8% 29.2% 38.8% 31.9% 689 67.4% 21.7% 690 32.6% 78.3% *MS-DRG descriptions provided below MS-DRG 064 065 066 069 189 190 191 192 193 194 195 247 287 291 292 293 310 312 313 379 392 MS-DRG Title (FY 2008) Intracranial hemorrhage or cerebral infarction w MCC Intracranial hemorrhage or cerebral infarction w CC Intracranial hemorrhage or cerebral infarction w/o CC/MCC Transient ischemia Pulmonary edema & respiratory failure Chronic obstructive pulmonary disease w MCC Chronic obstructive pulmonary disease w CC Chronic obstructive pulmonary disease w/o CC/MCC Simple pneumonia & pleurisy w MCC Simple pneumonia & pleurisy w CC Simple pneumonia & pleurisy w/o CC/MCC Perc cardiovasc proc w drug-eluting stent w/o MCC Circulatory disorders except AMI, w card cath w/o MCC Heart failure & shock w MCC Heart failure & shock w CC Heart failure & shock w/o CC/MCC Cardiac arrhythmia & conduction disorders w/o CC/MCC Syncope & collapse Chest pain G.I. hemorrhage w/o CC/MCC Esophagitis, gastroent & misc digest disorders w/o MCC 470 603 641 683 689 690 871 885 906 7. Major joint replacement or reattachment of lower extremity w/o MCC Cellulitis w/o MCC Nutritional & misc metabolic disorders w/o MCC Renal failure w CC Kidney & urinary tract infections w/ MCC Kidney & urinary tract infections w/o MCC Septicemia w/o MV 96+ hours w MCC Psychoses Hand procedures for injuries Review the case mix index (CMI) figures in tables 1 and 2, next. Compare the hospital figures to the state average and the peer facilities. Facility Hospital A Hospital B Hospital C Hospital D State Average Table 1 - Overall CMI - Years 1-3 Year 1 Year 2 1.8694 1.9017 1.9662 2.0554 1.6440 1.6873 1.8454 1.7021 1.4480 1.4778 Year 3 2.1473 2.0267 1.7010 1.6250 1.4953 Facility Hospital A Hospital B Hospital C Hospital D State Average Table 2 - MCD 08 CMI - Years 1-3 Year 1 Year 2 1.5700 1.4941 1.6917 1.8145 1.7264 1.7812 1.8246 1.8628 1.5461 1.6127 Year 3 1.3914 1.9703 1.7898 2.0187 1.6292