Become more savvy about E&M coding for surviving audits

April 1, 2008

Insurers fixated on maintaining coveted profits are increasingly profiling physicians based on the distribution of medical charges. Go below the mean and you're a star. Venture above the mean and risk being labeled a "bad" doctor, punished with economic penalties and excluded from specific health insurance programs. Learn how to review information collected by insurance companies and how to document appropriate levels of service

Insurers fixated on maintaining coveted profits are increasingly profiling physicians based on the distribution of medical charges.

Go below the mean and you're a star. Venture above the mean and risk being labeled a "bad" doctor, punished with economic penalties and excluded from specific health insurance programs.

Insurers, Dr. Thompson said, are concerned that physicians code too high and are robbing them of profits. Insurers are working hard to try to decrease their medical costs by carefully examining the levels of service charged by doctors for office visits. That has led to increased physician profiling based on the distribution of medical charges.

"Physicians need to become more savvy about evaluation and management (E&M) coding to avoid being intimidated by insurers who are more interested in profits than patient care," Dr. Thompson said. "Play the game by the rules they've set up for us."

For services rendered

Physicians can reverse some of the declines in reimbursement by making sure they are paid at the highest appropriate level for patient examinations. Centers for Medicare and Medicaid Services, private insurers, and the U.S. government have incentives to make higher level–4 and 5–E&M coding difficult, so they place onerous documentation burdens on physicians.

There are two E&M guidelines–1995 and 1997–but ophthalmologists are advised to use the 1997 version, which defines specialty exams.

There are two types of encounters under E&M rules-new patients and established patients. New patients can be brand new to the practice or a returning patient who has not been examined within 3 years. Established patients are those patients who return for care, or patients who are seen by another provider in the same practice.

There also are three components of the encounter-history, examination, and medical decision-making. The history includes a review of systems, past history, and the patient's chief complaint. Those subcomponents of history are graded on four different levels. In order to bill at the highest level of a comprehensive exam, it has to meet several elements.

To use consultation codes (99241-99245), there must be a documented request from a provider. Consults cannot be filled if the referring doctor transfers all care of that patient. A referral from an emergency room is not a consult since the ER doesn't expect to see the patient back.

Using eye codes may be easier because they were written for ophthalmologists. Insurers sometimes pay higher for equivalent eye codes than E&M codes, and documentation can be somewhat less cumbersome. Eye codes must have a decision making process-some type of diagnostic or treatment plan for a level 4 eye code. If there is no treatment plan, use the E&M codes. To bill for a level 4/5, an electronic medical record (EMR) or checklist is essential to be sure all required elements are included.

Interestingly, the government is in favor of EMRs, while insurers don't like them. Some studies show that EMRs improve the quality of patient care, but also promote coding at higher levels. EMR provides a legible record but also allow charting by exception, which is somewhat controversial because only the abnormalities are changed on the EMR template.

The only information insurance companies have about the complexity of a patient encounter are the diagnoses and charge codes. Increasingly, insurers are using that information to profile physicians. Insurers will profile all patients with a particular diagnosis to analyze the code levels chosen by a physician. They also analyze other changes, including testing and procedures that are billed by the physician or other providers within the practice.

In his own experience with "Big Brother," Dr. Thompson said he re-analyzed his records from his insurer and found their data inaccurate. When the insurer suggested he take an online coding course from Ingenix University, he scored a 95% on the pre-test and 100% on the post-test.

"Obviously, I knew the rules," he said, adding that the insurer didn't realize he was a subspecialist. "The moral of the story is: challenge their data. I finally got a letter that reclassified me as a retinal specialist."