1. Outpatient Clinical Documentation Improvement: the Next Frontier in the Battle to Prevent Denials
Tracey A. Tomak, RHIA
Director of Clinical Denial Prevention
St. Vincent Health

2. Objectives
Discuss history of Clinical Documentation Improvement programs
The changing healthcare landscape
Where to focus efforts today
Root-cause analysis
Education/training/concurrent/retrospective
What does the future look like?

3. St. Vincent Health System
8 PPS acute care facilities
8 Critical access facilities
3 Behavioral health centers
2 Acute rehab units
3 Ambulatory surgery centers

4. CDI History
According to Wikipedia, Clinical Documentation Improvement is defined as follows:
“Clinical documentation improvement (CDI) is the recognized process of improving healthcare records to ensure improved patient outcomes, data quality and accurate reimbursement.”

5. CDI History (Continued)
The career of the CDI professional began in response to DRGs and gained momentum around 2007.
At that time, roughly 30% of hospitals reported having a CDI Program compared to nearly 88% of hospitals today
The focus today heavily remains focused on Inpatient documentation

6. CDI History (Continued)
Many factors drove the implementation of and sustained perceived need for the CDI programs we see in the inpatient setting today:
Inconsistency in documentation led to increased scrutiny by government and third party payer auditors
Undocumented diagnoses and co-morbidities left money on the table due to lower weighted DRG assignments
Case mix indexes were low despite the “feeling” that our caregivers were treating sicker patient- thus we needed to either confirm or debunk this idea

7. CDI History (Continued)
In the beginning our medical staff by-in was quite often a “hard sell” for CDI professionals
MDs are not trained to document for coding and physician billing did not require a high level of specificity
Engaging MDs required a fine balancing act between trying to obtain higher reimbursement and ensuring that the quality and complexity of care as well as severity of illness were adequately documented

8. The changing healthcare reimbursement landscape
While external auditors continue to focus much of their attention on the very fertile soil of DRG audit, the outpatient setting is increasingly becoming a target as well
According to the March 2016 Medicare Payment Advisory Commission Report to the Congress: Medicare Payment Policy: hospital inpatient discharges declined by nearly 20% between 2006 and 2014 while outpatient services increased by nearly 44%

9. The changing healthcare reimbursement landscape (continued)
Another factor that has changed for hospitals is the number of employed physicians- a nearly 50% jump from
In today’s healthcare reimbursement landscape, hospitals as well as physicians now have reason to be concerned with documentation due to various forms of value-based reimbursement models. The burden is increasing and it is now a shared burden- unlike reimbursement days past.

10. The changing healthcare reimbursement landscape (continued)
The new outpatient reimbursement system has introduced us to many new terms:
Risk adjustment- an actuarial tool used to predict healthcare costs based on the relative risk of the enrollees in the covered plans (45 CFR )
MACRA- the Medicare Quality Payment Program with two tracks- the Merit-based Incentive Payment system (MIPS) and the advanced Alternative Payment Models (APMs)
HCCs- Hierarchy Category Codes (used by Medicare Advantage Plans)

11. Change in CDI focus- Why look at Outpatient?
Due to the changing focus on outpatient reimbursement and overall quality measurements, physicians and hospitals now share the burden of not only getting paid for services rendered, but also keeping the reimbursement already received and ensuring future reimbursement and possible incentives through reporting positive quality measures

12. Change in CDI focus- Outpatient setting(s)
As previously mentioned, the number of outpatient services continues to grow
Meanwhile, estimates indicate that only 10% of hospitals currently have organized outpatient CDI programs
Outpatient CDI focus should not only be part of the hospital focus but physician practices should also consider investing in CDI services

13. Root-cause analysis
Some key metrics to consider for a successful outpatient CDI are:
E&M coding accuracy
Decrease in cases rebilled or held due to coding/billing edits
Increase in reimbursement
Differences between pre- and post- review claims
Charge capture accuracy
Other charge trends

14. Root-cause analysis: Denials
Looking at denial history can be on key to starting a successful CDI program
It has been said that nearly 90% of all denials are preventable
Denial prevention requires dedicated staff to perform root-cause analysis, sufficient data collection tools, timely feedback and continued process improvement efforts in various formats

15. Root-cause analysis: Denials (continued)
One example of outpatient denials is write-off volumes for lack of medical necessity for services provided which are part of a Local or National Coverage Determination (LCD or NDC)
There are two ways to review this population of claims- pre-bill and post-bill
Following is a case-study of this process done both ways at St. Vincent over the course of FY16 and FY17

16. Case Study- Post-bill review of claims written off due to LCD/NCD (outpatient medical necessity)
The St. Vincent revenue cycle operations department has been reviewing denial write-offs consistently since Jan 2015.
As part of the review effort, root-cause analysis and process improvement efforts have become a key component of the effort to prevent future denials and avoid appeals and/or write-offs
One category of review began as a post-billing, post- write-off review of claims that did not meet medical necessity for Medicare LCD/NCD

17. Case Study- Post-bill review of claims written off due to LCD/NCD (outpatient medical necessity)
Although St. Vincent had a process in place to review claims prior to billing, this effort took time away from staff in billing, coding and at the facility level as well
The DNFB was up and much of the time staff was unable to identify or obtain a qualified diagnosis
The result was a multi-million dollar line item write-off across the health system annually (FY16 data)

18. Case Study- Post-bill review of claims written off due to LCD/NCD (outpatient medical necessity)
Despite review of this line item consistently by staff, the write-offs continued and very few trends were identified and corrected
In order to effectively identify the root-cause of the lack of medically justified diagnoses, the process of review was moved to a dedicated team of three certified coding professionals in March 2016
The team began review of claims at the point of the billing edit

19. Case Study- Pre-bill review of claims written off due to LCD/NCD (outpatient medical necessity)
Medical records were reviewed and data was collected for:
Root-cause- lack of MD documented medical necessity, coder missed documentation in the patient record, charge assigned incorrectly, edit incorrect, charge-code mismatch, etc.
Action- query to MD, dx added, claim sent back to CDM, claim sent back to coding, claim edit bypassed manually, etc.
Outcome- billed with covered dx, GA modified, GZ modified, charge corrected, claim edit correction requested, etc.

20. Case Study- Pre-bill review of claims written off due to LCD/NCD (outpatient medical necessity)
Many root-causes were identified within the first few months of the process
Many MDs were sending patients to lab for a battery of tests with only an “Annual physical exam” as the diagnosis
Coders were often missing a dx on page 2 or 3 of orders
Coders were not coding to the specificity noted in the medical record
Coding and charges were not aligned- in the case of screening vs diagnostic tests
Edits in the billing system and the claim scrubber did not match or were invalid for the MAC and claims were being held in error
ABNs were invalid or not present at all

21. Case Study- Pre-bill review of claims written off due to LCD/NCD (outpatient medical necessity)
As a result of the root-cause data collected, education was provided back to the coding team, front-end registration staff received re-training on use of the medical necessity checking software (and were provided real-life examples from their own facility), edits were corrected in the billing system and claim scrubber and our denial team teamed up with the St. Vincent Medical Group for feedback and case examples specific to MDs and their patients
By the end of FY17, St. Vincent had seen a reduction in write-offs for outpatient medical necessity of 46%, saving the organization over 1M annually so far

22. Other write-off categories with consistent review
Excessive observation for Medicare patients- all claims sent to Case Management monthly for review
Short stay write-offs- finding lack of follow-up with payers in notes from case management. Denial RNs have access to all notes and will appeal when possible. Lack of follow-up evident in many claims. 30% penalty for incorrect status or no auth for claims billed as IP.
Non-covered services- services that other payers may deem to be not necessary due to lack of covered diagnosis or due to bundling/packaging rules
These categories would be among next steps for an organized, focused CDI analysis

23. Education/training/concurrent/ retrospective
Converse to the traditional inpatient CDI programs we are all used to, and as indicated in the previous scenario, outpatient CDI is difficult to manage in a concurrent setting for many services that a hospital provides such as the following:
Radiology, lab and other ancillary testing
Ambulatory surgery
Emergency department
Infusion and Wound treatment settings

24. Education/training/concurrent/ retrospective
In the typical outpatient or ambulatory setting, much of the work of CDI will be retrospective analysis and a fine line will need to be drawn to balance obtaining complete documentation and holding up DNFB
In addition, education may be just as important for physicians and coders in the beginning of the process since outpatient coding specificity has not been as much of a reimbursement focus in the past on the facility side- for Medicare, CPT has historically driven the APC and payment and many other payers have paid based on contracted amounts (reasonable and customary or percent of charges)

25. Education/training/concurrent/ retrospective
One area that has been a target for auditors in recent years has been the short stay patient. Payers have questioned the need for inpatient charges for patients staying 48 hours or less in a hospital bed and many times even question lengths of stay up to five days due to lack of medical documentation to support severity of the patient’s current condition
This area is one which requires a dedicated team of professionals to concurrently and quickly work with physicians to adequately capture all relevant, active and acute conditions to support the appropriate “setting”.

26. What does the future look like?
The growing population of covered individuals continue to consume the majority of their healthcare in the outpatient setting.
In response, Medicare and other payers are beginning to collect data in aggregate format by healthcare organization and by physician.
Population health is composed of an aggregation of global visits rather than an episodic review by patient.

27. What does the future look like? (continued)
As a result of this aggregated data analysis and new quality measures that will impact the future of reimbursement, the time has come for healthcare facilities and physicians alike to consider adopting some form of outpatient CDI- retrospective or concurrent
Outpatient services provided in a hospital BEGIN with the plan of care in the physician office and as such more and more payers are auditing and asking for this plan to be cohesively documented between the physician office and the hospital setting (ex. Blepharoplasty and joint replacements)

28. Getting started…
Determine where to begin data analysis- pre-bill and post-bill internal audit
Determine staffing needs- very different skillset than inpatient CDI
Determine KPIs/Metrics to measure success
Develop policies
Develop education materials for registration staff, physicians and coding as needed
Engage the help of your EHR vendor for prompts
Consistent and timely meetings
Focus on quality and the reimbursement will follow

30. Questions?

31. Contact Information
Tracey A. Tomak, RHIA
St Vincent, Indianapolis, IN