Federal Audit Findings in E/M Services. Here s a top 10 survival guide. BY MICHAEL CALAHAN, PA, MBA
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1 Federal Audit Findings in E/M Services Here s a top 10 survival guide. BY MICHAEL CALAHAN, PA, MBA Georgejmclittle Dreamstime.com Reprinted with Permission from The Journal of Medical Practice Management, May/Jun 2012, pgs , copyright 2012 Greenbranch Publishing, LLC, (800) , Physician practice managers and administrators have their work cut out for them; they must lead the charge in conducting internal coding validation and documentation reviews as well as present the (often) unfavorable results to the providers. Primary areas of risk uncovered during these auditing efforts are in E/M services, a predominant service performed literally millions of times across all physician specialty practices. As well, continuing efforts are needed in developing reporting strategies in the face of Medicare s 2010 deletion of consultation codes from its physician fee schedule. For Medicare beneficiaries and under numerous state Medicaid programs consultation services must now be reported using CPT codes for office/outpatient visits ( ) as well as hospital inpatient services ( ). This drastic change in E/M coding has both advantages and disadvantages: it allows providers to disregard the heretofore restrictive consultation documentation criteria and leverages the less rigid, more familiar office and hospital visit codes. E/M Services are Now More of a Federal and State Target However, an ominous disadvantage lurks on the horizon. This change now increases the value of traditional E/M services; enhances their impact on provider revenue; and, in a paradoxical twist, makes these fairly mundane services more of a federal and state target. Because the Centers for Medicare & Medicaid Services (CMS) has plumped up reimbursements for these services (to account for the loss of consultation fees) and because billions of dollars are paid out to providers each year for E/M services and (the two most frequently reported E/M services), federal and state auditors are watching closer than ever to ensure fewer incidences of improper payments. Robust federal audit programs assail providers both physicians and non-physician practitioners (NPPs) through a variety of initiatives. The major audit schema includes, among others, efforts by CMS via jurisdictional Medicare Administrative Carriers (MACs), the Comprehensive Error Rate Testing (CERT) program, the Annual Work Plan by the Office of the Inspector General (OIG), and the aggressive audit program of the Recovery Audit Contractors. Ascertain Continued on page 110 APRIL/MAY 2013 PODIATRY MANAGEMENT 109
2 which audit findings yield the most valuable improvement opportunities. How can the typical practice manager or administrator help physicians and NPPs in the face of this mounting scrutiny? A smart first step is to ascertain which audit findings yield the most valuable improvement opportunities. Afterwards, the ultimate goals are to structure an efficacious clinical documentation improvement program and strengthen internal coding and billing processes. The following is a Top 10 Plus 1 accounting of recent CMS, MAC, CERT, and OIG audit findings within the typical E/M service code ranges for office and inpatient hospital services. For each top 10 audit result, survival tips are also provided: 1. Illegible, Unauthenticated, and/or Indeterminate Authorship of Medical Records Illegible physician and NPP signatures, unauthenticated medical record (MR) notes (i.e., unsigned either by hand or by e-signature), and/or the federal reviewer s inability to differentiate ancillary staff notes from treating provider s notes account for the preponderance of federal audit findings. Survival Tips: Legible signatures are required to certify services; illegible signatures submitted without evidence of proof-of-signature are adjudged by reviewers as indeterminate and equated to unsigned MR documentation. Likewise, mixing ancillary staff/scribe notes in the body of the clinical note without signature clarification is tantamount to unauthenticated records. These various documentation errors are denied because services were unable to be verified as being rendered by the billing provider. Practice managers must ensure that providers and ancillary staff sign/date all clinical note contributions so authorship of MR documentation is clear. Excluding certain hospice documentation, facsimile stamped signatures are no longer valid for federal purposes. 2. Non-response to Additional Documentation Requests Ignoring or not responding in a timely manner to official MR documentation requests, termed Additional Documentation Requests or ADRs when issued by MACs/Part B Carriers, is another prevalent audit finding. ADRs are simple MR documentation inquiries to assess and verify services billed. The request encompasses all documentation germane to the date-of-service (DOS) under investigation; all relevant documentation must be copied and sent to the requesting entity. Survival Tips: Practice managers Illegible signatures submitted without evidence of proof-of-signature are adjudged by reviewers as indeterminate and equated to unsigned MR documentation. and providers should ensure that receipt of each ADR is logged, the processing of which is tracked and monitored, and final fulfillment is confirmed by certified mail. For larger group practices or multi-location practices, setting up an internal ADR Response Team is often a wise choice to handle the often overwhelming number of payer and other third-party requests for supportive MR documentation. Follow-up and/or remedial steps must be performed once feedback from the requesting entity is received (e.g., analysis of audit results, fiscal impact of repayment demands, provider education in documentation, additional coder training, etc.). 3. Review of Systems, a Component of the History, Missing or Poorly Documented for the E/M Service Reported Recording the patient s history is, by audit, the weakest area of provider documentation for office and hospital visits. Easily the most overlooked element of the history portion of the note is the review of systems (ROS), which, when missing or poorly documented, severely limits the level of the E/M service that can be legitimately reported. This is paradoxical as the ROS, like past medical, family/social history (PFSH), can be expertly obtained by ancillary staff, and subsequently reviewed/certified by the treating provider. Examples of poorly documented ROS include those with blanket statements like all systems unremarkable; which many MACs/Part B Carriers do not recognize as legitimate documentation. Survival Tips: There are few reasons why the ROS cannot be thoroughly obtained, unless it is not medically necessary. If the ROS is obtained on a separate form or questionnaire, the form should be signed/dated by the provider to certify the ROS document is germane to the current visit. All such segregated data should be bridged to the DOS in question and included in the reviewer s package when MR documentation is requested. 4. E/M Code Reported Without Sufficient Documentation CPT code is designed for minimal problems requiring relatively speedy visits carried out by ancillary staff and supervised by the reporting provider. Adequately substantiated in the MR documentation, can be reported for myriad services. Errors in reporting range from inadequate or no MR documentation to the automatic billing of with other minor staff services (e.g., blood pressure checks, PPD readings, specimen collection, etc.), without cognitive services being performed. Survival Tips: CPT code represents a true E/M service; therefore, the MR documentation must convey features of both evaluation and management services (e.g., 1] essential clinical information is provided or exchanged based on the patient s condition or problem-related inquiries; and 2] therapy, management, Continued on page APRIL/MAY 2013 PODIATRY MANAGEMENT
3 or a treatment plan is rendered/provided). Both actions must be documented to substantiate the cognitive service paid under Since this E/M service is typically furnished by ancillary staff under the provider s direct supervision, it is reported as incident to. The provider must certify the chart notes, and all criteria for incident-to services must be satisfied. 5. Time Used as Key Component for E/M Services but Is Inadequately Documented Providers can report non-timebased E/M services using time as the key factor instead of the three key components of history, physical examination (PE), and medical decisionmaking (MDM) when counseling and/or coordination of care (CoC) constitute 50% or more of the total face-to-face time. Federal auditors find numerous instances of missing or poorly documented time(s) when the provider clearly intended to use time as the singular key component for the E/M service reported. Survival Tips: Document two strata of time when relying on time as the leveraging factor: 1) total face-toface time for the entire encounter; and 2) total time spent in counseling and/or CoC. The second stratum demonstrates the >50% rule; the first stratum creates the frame of reference for stratum #2. For office services not face-to-face time (i.e., time expended in pre-/post-visit work) cannot be included in the total time calculated; inpatient services, however, can include nonface-to-face unit/floor time spent in the care of the patient. Content of counseling/coc must be fully documented. 6. Misapplication of Modifier -25 By definition, modifier -25 is reported with an E/M code when significant, separately identifiable E/M services are rendered by the same physician on the same day of a procedure or other service. Federal auditors have found three frequently occurring errors after reviewing claims and MR documentation: 1) modifier -25 was incorrectly reported on a non-e/m service (e.g., for electrocardiogram); 2) modifier -25 was reported with an E/M code when the patient presented solely for a minor procedure (e.g., joint injection), however, the E/M service was not documented or was not medically necessary; and 3) modifier -25 was not reported but was needed when an E/M service and a minor procedure (with a global surgery indicator of 000 ) were provided. Survival Tips: Modifier -25 is designed to allow certain E/M services to bypass system edits. It should be Continued on page APRIL/MAY 2013 PODIATRY MANAGEMENT
4 appended only to an E/M service to make clear that a particular service is significant, separately identifiable, and therefore separately payable. MR documentation must substantiate these separately payable circumstances. The triple-zero global surgery indicator ( 000 ) signifies that only the day of the procedure is included in the global surgery period, not the misinterpreted meaning of no surgical period applies and therefore no modifiers are necessary for concomitant E/M services. If the E/M service is not reported with modifier -25 in these circumstances, the service is denied. The Medicare Claims Processing Manual (MCPM) , Chapter 12, addresses Carrier monitoring of modifier -25, for example at 40.2.A.8: When Carriers have conducted a specific medical review process and determined... an individual/group has high statistics... of the use of modifier -25, and after a case-by-case review to verify that the use of modifier -25 was in fact inappropriate, following education to the individual/group as to the proper use of this modifier, any continued misreporting of the modifier may result in sustained Carrier pre-payment screens, claim delays, and/or expanded documentation reviews. 7. Conundrum of the Expanded Problem-Focused and Detailed Physical Exams: The 434 Rule Confusion surrounds these two specific examination levels because the 1995 and 1997 E/M Documentation Guidelines (DGs) are ambiguous for both the expanded problem-focused (EPF) and detailed examinations by stating that both must contain 2-7 elements, specifying the EPF level requires a limited exam and the detailed requires an extended exam. Both must address the affected areas/systems and any other symptomatic or related areas/systems, up to 7. The similar definitions for limited and extended have caused provider misinterpretation and allowed for a predominant auditor finding of insufficient PE documentation for a detailed level exam, such as for E/M codes 99203, 99214, 99221, and Survival Tips: Practice administrators should know the 434 rule, which comprises four elements or items examined within four body areas or organ systems. For providers, the 434 rule is a quick and uncomplicated method to avoid misinterpretation. For federal and professional auditors, it allows an efficient assessment of the documentation and more exact differentiation. Managers should check with the local Part B Carrier to ascertain the guidelines for EPF and detailed examination levels. Federal auditors are tasked with referencing Continued on page 114 APRIL/MAY 2013 PODIATRY MANAGEMENT 113
5 both sets of E/M DGs 1995 and 1997 adjudging each case being reviewed so that the final assessment best benefits the provider. Even when the 434 rule is not officially promulgated, it remains a useful resource. 8. Rules for Reporting CPT Code 99499: Unlisted E/M Service CMS addresses billing of CPT code (MCPM , Chapter 12, 30), stating the Carrier has the discretion to value the service. In effect, the Part B Carrier is in control, and many maintain that should be reported only in rare instances. Rare is the operative term and used repeatedly in official literature. This is because adjudicators must review associated documentation and apply individual consideration protocols for appropriate pricing of each service reported under (as with any unlisted CPT or HCPCS Level II code). Survival Tips: Report in rare circumstances and only per Carrier instructions. A rare example provided by a local MAC follows: If documentation criteria for initial inpatient hospital services cannot be met and if... even a cannot be met, but the documentation does meet the criteria for subsequent inpatient hospital services , then code appropriately even though it is chronologically an admission... However, if the documentation does not even meet the criteria for a 99231, then code This illustration shows that the Part B Carrier would rather have the provider go out of code sequence than deal with processing a claim with an unlisted code. Instructions are specific; the wise practice manager is familiar with MAC/Part B Carrier jurisdictional preferences. 9. Modifier -24 and the Global Surgical Period When reporting E/M services after a major procedure (i.e., during the global surgical period [within 90 days] of the major procedure or after a minor procedure but also during the procedure s global surgical period [typically 1 to 10 days]), the appropriate documentation must support the separately payable service, and the E/M code must be appended with modifier -24. Documentation must detail why an E/M service should be paid within the global surgical period. According to the MCPM , Chapter 12, 40.2.A.7, services submitted with modifier -24 must be sufficiently documented to establish that the visit was unrelated to the surgery. An ICD-9-CM code that clearly indicates the reason for the encounter was unrelated to the surgery is acceptable documentation. Survival Tips: This is one of the few E/M services included in the OIG Annual Work Plans. Practice managers must implement steps to prevent inadvertent reporting of post-op E/M services as separately payable when the patient is in a postsurgical status, but also develop strategies for when the billing of these services is appropriate. Coders/billers should have solid knowledge of global surgical periods, of using modifiers such as -24 that sidestep system edits, and of appropriate scenarios that require these modifiers. 10. Missing or Poorly Documented Key Components of the E/M Service This Top 10 mention is the lastlisted, but in aggregate it is the most prevalent of all audit findings. For most E/M services, three key components govern code selection: 1) history; 2) PE; and 3) MDM. For new office visits and initial hospital inpatient services, these key components must be included in the documentation. When only two key components are required to be documented (i.e., for subsequent office or hospital visits), at least two of the three components must meet the service s lowest threshold requirements. Survival Tips are interspersed with federal audit findings as follows: History Missing or lack of recorded critical elements including chief complaint (CC), PFSH, and history of present illness (HPI) (ROS problems were previously addressed): Contradictory data between elements is a common error (e.g., the CC states one reason for the visit, but the HPI details a different problem). Some Carriers require the CC and HPI to be documented only by the treating provider. Terms like non-contributory under the PFSH or ROS may be invalid; internal compliance staff must know Part B Carrier jurisdictional preferences. PE Missing or insufficient documented information: A common provider-documented PE statement is no change from prior visit. When three key components are required for the E/M service, this brief statement is inadequate and will be discounted by federal reviewers. Negative and WNL notations are acceptable forms of documentation for unaffected areas/organ systems, but are unacceptable under E/M leveling criteria for affected areas/organ systems that relate to the CC and/or HPI within the history. MDM Truncated or disorganized data: MDM information conveys the complexity and risk of the service, and must be fully documented. Additionally, disorganized MDM data can cause mistakes in copying and assembling MR audit packages for reviewers. This is easily remedied when the provider creates a data bridge between the body of the visit text and other related supporting documents so that all elements of each DOS can be brought together. The data bridge is especially critical when the provider has reviewed old MRs, ordered tests/studies, carried forward or revised diagnoses and medications, etc. If these disparate documents are overlooked and not submitted to federal reviewers, the service will be down-coded or denied. This also relates to history elements (e.g., the ROS), when recorded and maintained on separate forms. Practice managers should educate staff tasked with processing MR and ADR requests on the proper assembling of complete audit packages for federal reviewers. Plus One Extra: An Additional Common Audit Finding Hospital Inpatient or Skilled Nursing Facility Visits Performed by a NPP but Reported under the Physician s Provider ID NPP services performed in accordance with State Code and hospital Continued on page APRIL/MAY 2013 PODIATRY MANAGEMENT
6 bylaws still cannot be reported under Medicare regulations as incident to services when performed in the inpatient setting (i.e., hospital, skilled nursing facility, nursing facility, etc.). This is a common mistake and a frequent federal audit finding. The services must be reported under the NPP s National Provider Identifier (NPI) as assigned by CMS, and therefore will be subject to the reduced NPP fee schedule amounts (i.e., 85%). Survival Tips: In August 2009, the OIG released a report of incident-to audit findings and included a new section in the 2012 OIG Annual Work Plan to study the incident-to reporting scenarios activities for which there may be future reporting revisions (e.g., an incident-to modifier may be developed and required on claims). MAC/Carrier reviewers may increasingly request MRs related to incidentto services, since these entities have been advised by the OIG to closely monitor incident-to payments. In the meantime, if hospital inpatient services are performed by an NPP, then those services must be reported under the NPP s assigned NPI unless it is a split/shared service. Managers must ensure all billing and compliance personnel are aware of this regulation and complete claims accordingly. Conclusion Meticulous MR documentation has always been one of the keystones of quality patient care. It is certainly the much-touted foundation for a successful transition from ICD-9-CM/PCS to full-scale ICD-10-CM/PCS code system implementation (by October 1, 2014). It also has the capacity to protect providers in myriad scenarios, including federal audits. The disparate audit findings included in this article are not all-inclusive but are among the predominant audit findings that have surfaced during federal review processes. Adhering to the survival tips (as appropriate to the service, setting, and other patient encounter details) can assist physician practice staff in directing providers to avoid federal recompense demands by preventing E/M services from being down-coded or denied. PM Sources 2012 Annual Work Plan. U.S. Department of Health and Human Services, Office of the Inspector General Reports. h t t p : / / o i g. h h s. g o v / r e p o r t s - a n d - p u b l i c a - tions/workplan/index.asp#current. Accessed October Calahan MG. Avoiding the median coding phenomenon. Health Care Compliance Association Annual Physician Conference Seminar, Philadelphia, Pennsylvania, October 12, Calahan MG. Top 10 federal audit findings in E/M services. Medical Group Management Association Annual Conference Seminar, Las Vegas, Nevada, October 25, CERT errors ( ) specific to E/M services; E/M audit FAQs; compounded information best viewed at three Medicare Carrier web sites: Wisconsin Physician Services (WPS) Medicare; Trailblazers Medicare; and Cahaba Medicare (MAC A/B J10). CMS Transmittal 1875/Change Request Revisions to Consultation Services Payment Policy; December 14, CMS Transmittal 327/Change Request Signature Guidelines for Medical Review Purposes; June 16, 2010 (Revised). Evaluation and Management Documentation Guidelines, 1995 and 1997, as published by two oversight entities: CMS and AMA. Evaluation and Management Services (training manual). TrailBlazer Health Enterprises, LLC; September Medicare Claims Processing Manual/Internet-Only Manuals , Chapter 12, Physicians/Nonphysician Practitioners, Sections 30 and 40. Medicare Program Integrity Manual/Internet-Only Manuals , Chap ter 3, Verifying Potential Errors and Taking Corrective Actions, Section Facsimile Signature Requirements. Misconceptions of 000 Global Surgery Period. WPS Medicare Part B MAC e-news; December 14, Review of Incident To Services, Report U.S. Department of Health and Human Services, Office of the Inspector General, Office of Evaluation and Inspections Reports; August What is the 434 method for determining if an examination is scored as an expanded problem focused or detailed? Highmark M e d i c a r e S e r - vices, E/M FAQs. u - tb/pet/ lpet-evaluation_ management_services.html. Posted October 5, 2009; revised August 29, Michael Calahan is an AHIMA Certified ICD- 10-CM/PCS Trainer and V.P., Hospital & Physician Compliance, Healthcare Consulting Solutions (HCS). He can be reached at mikiecal@hotmail.com. 116 APRIL/MAY 2013 PODIATRY MANAGEMENT
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