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Billing and Coding for Health Services

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Presentation on theme: "Billing and Coding for Health Services"— Presentation transcript:

1

2 Billing and Coding for Health Services
Chapter 2 Billing and Coding for Health Services

3 Topics Covered Healthcare Claims Registration Medical Record/Coding
Charge Entry/Chargemaster Billing/Claims Preparation Claims Editing

4 Objectives 1. Describe the revenue cycle for health care firms.
2. Understand the role of coding information in health care organizations in claim generation. 3. Define the basic characteristics of charge masters. 4. Define the two major bill types used in health care firms. 5. Appreciate the role of claims editing in the bill submission process.

5 Figure 2–1 Revenue Cycle

6 Charge Slips Order Entry
Billing Process Claims Generation Process Overview of Process CPT/HCPCS (Dynamic) and ICD-9-CM Code Development Medical Record Services Outpatient Inpatient UB-04 HCFA-1500 Claims Generation Detailed Bill Statement Charge Slips Order Entry Charge Codes Charge Master Information Charge Master Charge Codes Revenue Codes Charges CPT/HCPCS Codes Activities 1. Services Provided 2. Services Documented 3. Charges Developed 4. Coding Performed 5. Bill/Claim Produced 6. Payment Received

7 Major Revenue Cycle Steps
Registration Medical Record/Coding Charge Entry/Chargemaster Billing/Claims Preparation Claims Editing

8 Registration Basic information collected on the patient
3 major activities: Insurance verification, including patient’s health plan identification number Amount due from patient for co-payment or deductible Financial counseling For patients with no insurance coverage or who are unable to pay co-payment or deductible Financing Medicaid and other governmental programs

9 Medical Record/Coding
Health Insurance Portability and Accountability Act (HIPAA) of 1996 Two coding systems International Classification of Diseases, Ninth Revision, Clinical Modification (ICD-9-CM) Healthcare Common Procedure Coding System (HCPCS)

10 Medical Record/Coding

11 ICD-9 Diagnosis codes are 3 digits, sometimes followed by a decimal point and a 4th digit or 4th and 5th digits Procedure codes Used to report inpatient procedures Up to 4 digits in length, with a decimal point after the first two digits Diagnosis and procedure codes are used for DRG assignment, which is often used to determine payment

12 ICD-9-CM Diagnosis Codes Example
003 Other Salmonella Infections Salmonella Gastroenteritis Salmonella Septicemia Localized Salmonella Infections Localized Salmonella Infection, Unspecified Salmonella Meningitis Salmonella Pneumonia Salmonella Arthritis Salmonella Osteomyelitis Other Localized Salmonella Infection Other specified salmonella infections Salmonella infection, unspecified

13 HCPCS Used by physicians for reporting both inpatient and outpatient procedures Used by facilities for reporting outpatient procedures Two tiers Level I—Current Procedural Terminology (CPT), a 5-digit code (maintained by AMA) Level II HCPCS codes These codes are often a major determinant of provider payment for both facilities and physicians.

14 Level I—CPT Codes Six Main Categories Evaluation & Management
Anesthesia Surgery Radiology Pathology and Laboratory Medicine May also contain modifier code that provides additional information essential to the claim

15 Level II HCPCS Codes Used to report products, services, supplies, materials, or procedures that are not present in the Level I (CPT) codes. 5-digit codes beginning with an alphabetic character followed by 4 numeric characters Two groups of codes: Permanent Temporary Used for needs not covered by the permanent codes Can remain “temporary” indefinitely and sometimes replaced by a permanent code

16 Charge Entry Represent the “capture” of products and services provided
Three greatest concerns in billing: Capture of charges for services performed Incorrect billing Billing late charges Charge capture methods: Charge slips posted as batch process Order entry system Charge explosion can be used when a uniform set of supplies is used

17 Chargemaster Also referred to as Charge Description Master (CDM)
A list of all the goods and services provided by a hospital, and the price (or prices) the hospital charges for each of those goods and services Six elements: Charge code Item description Department number Charge (price) Revenue code CPT/HCPCS code

18 Chargemaster Sample Extract

19 Billing/Claims Preparation
CMS-1500: the uniform professional claim form Used by non-institutional providers (e.g., physicians) to submit claims to Medicare and many other payers CMS-1450 (aka UB-04): the uniform institutional claim form Used by institutional providers to submit claims to Medicare and most other payers Data from this form is used to determine DRGs (diagnosis-related groups) and APCs (ambulatory payment classifications) One or more HCPCS codes must be present on the claim form if an APC is to be assigned (outpatient only). Most claims now submitted electronically

20 Sample UB-04 Form

21 Sample CMS-1500 Form

22 Claims Editing Software designed to find errors in claims
Providers use to maximize appropriate payment and to speed payment Payers use to determine minimum payment obligation and to delay payment for valid reasons Error checking: Spelling errors Missing data (e.g., date of service and diagnosis codes) Internal validity (e.g., procedure consistent with gender)

23 Claims Editing CMS developed the National Correct Coding Initiative (NCCI) to promote correct coding methodologies NCCI edits are incorporated within the Outpatient Code Editor (OCE) Ensures that the most comprehensive groups of codes are billed rather than the component parts Check for mutually exclusive code pairs 83 edits as of March 2010

24 Claims Editing Each OCE edit results in one of six dispositions
Claim-level dispositions Rejection—Claim must be corrected and resubmitted Denial—Claim cannot be resubmitted but can be appealed Return to provider (RTP)—Problems must be corrected and claim resubmitted Suspension—Claim requires further information before it can be processed Line-item-level dispositions Rejection—Claim is processed but line item is rejected and can be resubmitted later Denial—Claim is processed but line item is rejected and cannot be resubmitted

25 Summary Accurate billing and coding are essential to a healthcare provider’s financial viability Very complex area requiring specialized professionals Many providers fail to capture all charges to which they are entitled


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