Medical Coding Chapter 16 Medical Assisting PowerPoint® presentation to accompany: Medical Assisting Third Edition Booth, Whicker, Wyman, Pugh, Thompson

Learning Outcomes 16.1 Explain the purpose and format of the ICD-9-CM volumes that are used by medical offices. 16.2 Describe how to analyze diagnoses and locate correct codes using the ICD-9-CM. 16.3 Identify the purpose and format of the CPT. 16.4 Name three key factors that determine the level of Evaluation and Management codes that are selected.

Learning Outcomes (cont.) 16.5 Identify the two types of codes in the Health Care Common Procedure Coding System (HCPCS). 16.6 Describe the process used to locate correct procedure codes using CPT. 16.7 Explain how medical coding affects the payment process. 16.8 Define fraud and provide examples of fraudulent billing and coding.

Introduction Medical coding Translation of medical terms for diagnoses and procedures into code numbers from standardized code sets Tells payers that the services provided Were medically necessary Complied with payer’s rules Accurate claims bring maximum appropriate reimbursement for the medical office

Diagnosis Codes: The ICD-9-CM The Diagnosis Process Patient Chief Complaint Physician Medical Diagnosis Insurance Diagnosis Code The diagnosis codes are found in the International Classification of Diseases, Ninth Revision, Clinical Modification (ICD-9) The use of ICD-9 codes in health care is mandated by HIPAA for reporting:  Patient’s diseases  Conditions  Signs and symptoms

Diagnosis Codes: The ICD-9-CM (cont.) Alphabetic Index (Volume 2) Diagnoses appear in alphabetical order The index is organized by condition Use initially to look up conditions Cross-references Look up term that follows “see” The Alphabetical Index is never used alone to find a diagnosis code because it does not contain all the necessary information.

Diagnosis Codes: The ICD-9-CM (cont.) Tabular List (Volume 1) Diagnoses appear in numerical order Listing is organized according to source or body system Code Structure Codes are made up of three, four, and five digits and a description Three-digit categories are used for diseases, injuries, and symptoms Categories are further divided into four- and five-digit codes

Diagnosis Codes: The ICD-9-CM (cont.) V Codes Supplementary classification of factors influencing health status and contact with health services Identify encounters for reasons other than illness or injury May be a primary code or additional code E Codes “E” – external Only a supplemental classification of external causes of injuries and poisoning

[ ] NEC NOS ( ) Diagnosis Codes: ICD-9-CM Conventions Conventions A list of abbreviations, punctuation, symbols, typefaces, and notes that provide guidelines for using the code set. Conventions NEC An abbreviation that means “not elsewhere classified”; used when the ICD-9 does not provide a specific code to describe the patient’s condition [ ] Brackets are used around synonyms, alternate wording, or explanations ( ) Parentheses are used around alternative wording NOS An abbreviation that means “not otherwise specified” or “unspecified”

§ } : Diagnosis Codes: ICD-9-CM Conventions (cont.) Conventions Indicates that the footnote is applicable to all subdivisions in that code } Brace encloses a series of terms : Used in the Tabular List after an incomplete term Excludes Indicates that the entry is not classified as part of the preceding code Includes Refines content of preceding entry

Code first underlying disease Diagnosis Codes: ICD-9-CM Conventions (cont.) Conventions Use additional code This note means an additional code should be used if available Excludes These notes indicate that an entry is not classified as part of the preceding code Code first underlying disease This means that the code is not to be used for the primary diagnosis

Diagnosis Codes: The ICD-9-CM Codes (cont.) Record the code on the claim form  Steps to Locating an ICD-9-CM Code Read all information to find the code that corresponds to the patient’s condition  Locate the code from the Alphabetic Index in the Tabular List  Find the diagnosis in the Alphabetic Index  Locate statement of diagnosis in patient’s medical record 

Diagnosis Codes: The ICD-10-CM ICD-10-CM: A new revision Major changes Contains more than 2000 disease categories Codes are alphanumeric, containing a letter followed by up to five numbers Codes are added to show the specific side of the body affected by the disease process Expected to be adopted as HIPAA-required diagnosis code set before 2010

Apply Your Knowledge Good Answer! A medical assistant has looked up a medical term in the alphabetic index, and next to the term is the word “see.” What does this mean? ANSWER: This means the medical assistant must look up the term that follows the word “see” because another category should be used or cross-referenced. Good Answer!

Procedure Codes: The CPT Current Procedural Terminology (CPT) book The most commonly used system for reporting procedures and services provided to the patient This is the HIPAA-required code set Published annually by the American Medical Association (AMA) Updated annually Use the appropriate CPT book for the current year

Procedure Codes: Using the CPT Except for the first section, the CPT book is arranged in numerical order Section Range of Codes Evaluation and Management 99201–99499 Anesthesiology 0010–01999 Surgery 10021–69990 Radiology 70010–79999 Pathology and Laboratory 80048–89356 Medicine 90281–99602

Procedure Codes: Using the CPT (cont.) Add-on codes A plus sign (+) is used Always used with primary code Modifiers One or more two-digit numbers (up to three per procedure) assigned to five-digit main number Indicate that special circumstance applies

Procedure Codes: Using the CPT (cont.) Category II, III, and Unlisted procedure codes Category II Tracks health-care performance measures Category III Temporary codes for emerging technologies, services, and procedures Unlisted codes Used when no other code is available Require a written explanation

Procedure Codes: Evaluation and Management Services Used by all physicians in any medical specialty Key factors that help determine level of service The extent of the patient history taken The extent of the examination conducted The complexity of the medical decision made New Patient versus Established Patient New patients – not seen by physician within the past 3 years Established patients – seen within a 3 year period

Procedure Codes: Surgical Procedures The surgical package All procedures normally a part of an operation Anesthesia Surgery Routine follow-up care Global period The time period covered for follow-up care If past global period, additional services are reported separately

Procedure Codes: The CPT (cont.) Laboratory Procedures Panels – organ or disease-oriented Pathology and Laboratory sections of the CPT If separate codes are used, they will be rebundled and payment delayed Immunizations Injections require two codes One for the procedure (injection) One for the medication (vaccine or toxoid)

Excellent! Apply Your Knowledge Which section of the CPT is not arranged in numerical order and why? ANSWER: The first section, Evaluation and Management, is not in numerical order because the items in this section are used most often and by all physicians in any medical specialty. Excellent!

Excellent! Apply Your Knowledge The insurance representative has questioned the codes listed on three patient forms that were submitted last year. When re-checking these forms the office medical assistant should: Excellent! ANSWER: Use the current book to validate accuracy of the codes Use last year’s book to validate accuracy of the codes Use next year’s book to validate accuracy of the codes

HCPCS The Health Care Common Procedure Coding System Developed by the Centers for Medicare and Medicaid Services (CMS) Pronounced “hic-picks”

HCPCS (cont.) Contains two levels Level I codes Level II codes Duplicate CPT codes Level II codes National codes for supplies and DME (durable medical equipment) 5 characters – numbers, letters, or a combination of both Can have modifiers

Apply Your Knowledge Stellar! What are HCPCS Level II codes and who issues them? ANSWER: HCPCS Level II codes are national codes used for supplies, DME, and services not included in the CPT. They are issued by Centers for Medicare and Medicaid Services (CMS). Stellar!

Avoiding Fraud: Coding Compliance Medical assistants help ensure that maximum appropriate reimbursement is received for services provided Compliance with federal and state law and payer requirements is mandatory Code Linkage A process used by insurance company representatives to evaluate the necessity of medical procedures reported based on the patient’s diagnosis Diagnostic Procedures Prevent errors in coding and incorrect billing by careful attention to details

Avoiding Fraud: Insurance Fraud Investigators look for patterns such as Reporting services that were not performed Reporting services at a higher level Performing and billing for procedures not related to the patient’s condition and therefore not medically necessary Billing separately for services that are bundled in a single procedure code Reporting the same service twice

Avoiding Fraud: Compliance Plans Medical offices establish a process for finding, correcting, and preventing illegal medical practices Goals of compliance plan Prevent fraud and abuse Ensure compliance with applicable laws Help defend physicians if investigation occurs

Avoiding Fraud: Compliance Plans (cont.) Plan demonstrates to payers honest, ongoing attempts to correct any weak areas of compliance Plan is developed by a compliance officer and committee who also: Audit and monitor compliance Develop written policies and procedures that are consistent with regulations and laws Provide ongoing communication and training to staff Respond to and correct errors

Correct! Apply Your Knowledge What are the goals of a compliance plan and what does having a plan indicate? ANSWER: The goals of a compliance plan are to prevent fraud and abuse, ensure compliance with applicable laws, and to help defend physicians if an investigation occurs. Having a plan indicates that the medical office is making honest, ongoing attempts to find and fix weak areas of compliance. Correct!

In Summary ICD-9-CM Diagnostic coding for health-care claims Updated annually Two volumes Tabular list Alphabetic list V codes – encounters not related to illness or injury E codes – injuries related to environmental events

In Summary (cont.) CPT Standardized procedure codes for medical, surgical, and diagnostic services Six sections Evaluation and Management Anesthesiology Surgery Radiology Pathology and Laboratory Medicine

In Summary (cont.) HCPCS is used for coding Medicare services Claims CPT Level II national codes Claims Link diagnoses and procedures correctly Must comply with applicable regulations and requirements Practices should have a compliance plan with a formal process for review of procedures to guard against fraud

Things gained through unjust fraud are never secure. End of Chapter 16 Things gained through unjust fraud are never secure. ~ Sophocles