CMS finalizes changes to drug payments, relative weight calculations

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1 January 2013 Vol. 14, No OPPS final rule CMS finalizes changes to drug payments, relative weight calculations Hospitals earned a big win with drug payments this year in the 2013 OPPS final rule, released November 1. CMS decided to finalize its proposal to follow the statute and reimburse facilities at the average sales price (ASP) plus 6%. We ve been fighting for years to convince CMS to rely on the statute and provide payment for at least the acquisition cost of separately payable drugs at the level of ASP plus 6%, and now the agency has finally agreed, which is a nice win, says Jugna Shah, MPH, president of Nimitt Consulting based in Washington, D.C. IN THIS ISSUE p. 3 CMS packaging clarification could raise problems Third-party payers may misinterpret new language in the CFR. p. 5 Hospitals see therapy, molecular pathology changes Changes in the Medicare Physician Fee Schedule create operational changes for hospitals. p. 7 Begin teaching providers to speak ICD-10 Having a plan will make training physicians on new coding systems easier. p. 9 This month s coding Q&A Our coding experts answer your questions about reporting fetal ultrasound codes, bell curve for E/M visits, and billing for wasted drugs. p. 11 Briefings on APCs 2012 index Track down that hard-to-find Briefings on APCs article. Use our index to find articles we published in On the downside, CMS continues to raise the packaging threshold so that not all drugs receive separate payment, says Valerie Rinkle, MPA, vice president of revenue integrity informatics for Health Revenue Assurance Associates in Plantation, Fla. Drug costs and drug availability and FDA and other regulatory agency handling requirements all contribute years to convince CMS to We ve been fighting for to the volatility of rely on the statute and drug costs and availability, Rinkle says. least the acquisition cost provide payment for at For this reason, I of separately payable do not believe drugs drugs at the level of ASP are appropriate plus 6%, and now the for packaging and agency has finally agreed, similar to the Medicare Physician Fee Jugna Shah, MPH which is a nice win. Schedule, I believe all outpatient drugs should be paid at ASP plus 6%. Shah and many other industry stakeholders agree and have been urging CMS for years to provide separate reimbursement for all drugs, biologicals, and radiopharmaceuticals in the hospital setting as it does in the physician office setting. To date CMS has not agreed to create this level of payment parity. Geometric mean CMS finalized a change to the way it generates APC relative weights: For 2013, the agency will use geometric mean costs instead of median costs when calculating the weights. I think this is CMS way of starting to create more parity between the IPPS and OPPS systems, Rinkle says. It will be interesting to see if CMS wants to average cost centers together for purposes of calculating the geometric mean in a like manner to that under IPPS.

2 Page 2 Briefings on APCs January 2013 CMS may instead decide to change some of the cost center groupings under IPPS for issues such as the implantable cost center and MRI, CT, and cardiac catheterization cost centers, Rinkle says. In the OPPS final rule, CMS acknowledged some of the limitations of using the geometric mean but also addressed some of the benefits, including the agency s ability to make cost comparisons between IPPS and OPPS. I also noted the number of times CMS had to explain how they exclude lower-volume codes from the two-times rule, Rinkle says. I think this deserves more attention because the sensitivity of the geometric mean is limited by CMS excluding lower-volume codes from the two-times rule within an APC. The two-times rule refers to the guideline that the highest calculated cost of an individual procedure categorized to any given APC cannot exceed two times the calculated cost of the lowest-costing procedure categorized to that same APC. Editorial Advisory Board Briefings on APCs Dave Fee, MBA Product Marketing Manager, Outpatient Products 3M Health Information Systems Murray, Utah Frank J. Freeze, LPN, CCS, CPC-H Principal The Wellington Group Valley View, Ohio Susan E. Garrison, CHCA, CHCAS, PCS, FCS, CPC, CPC-H, CCS-P, CHC, CPAR Executive Vice President of Healthcare Consulting Services Med Law Advisors, Inc. Atlanta, Ga. Senior Managing Editor: Michelle Leppert, CPC-A, mleppert@hcpro.com Kimberly Anderwood Hoy, JD, CPC Director of Medicare and Compliance HCPro, Inc. Danvers, Mass. Diane R. Jepsky, RN, MHA, LNC CEO & President Jepsky Healthcare Associates Sammamish, Wash. Lolita M. Jones, RHIA, CCS Lolita M. Jones Consulting Services Fort Washington, Md. Jugna Shah, MPH President Nimitt Consulting Washington, D.C. Briefings on APCs (ISSN: [print]; [online]) is published monthly by HCPro, Inc., 75 Sylvan St., Suite A-101, Danvers, MA Subscription rate: $249/year. Copyright 2013 HCPro, Inc. All rights reserved. Printed in the USA. Except where specifically encouraged, no part of this publication may be reproduced, in any form or by any means, without prior written consent of HCPro, Inc., or the Copyright Clearance Center at For editorial comments or questions, call or fax For renewal or subscription information, call customer service at , fax , or customerservice@hcpro.com. Visit our website at Occasionally, we make our subscriber list available to selected companies/vendors. If you do not wish to be on this list, please write to the marketing department at the address above. Opinions expressed are not necessarily those of BAPCs. Mention of products and services does not constitute endorsement. Advice given is general, and readers should consult professional counsel for specific legal, ethical, or clinical questions. Current Procedural Terminology (CPT) is copyright 2011 American Medical Association. All rights reserved. CPT is a registered trademark of American Medical Association; no fee schedules, basic units, relative values, or related listings are included in CPT. The AMA assumes no liability for the data contained herein. Applicable FARS/DFARS restrictions apply to government use. Within a group of procedures, no individual procedure represented by a CPT code may be more than two times the associated cost of the lowest-cost procedure in the APC. If one of the CPT codes assigned to the APC had an associated cost greater than two times the lowest-cost procedure, the APC would be in violation of the two-times rule. As part of its annual adjustment to the OPPS, CMS uses this rule as a guideline when assigning new procedures or reassigning existing procedures into an APC category for payment. CMS can exempt any APC from the two-times rule for any of the following reasons: Resource homogeneity Clinical homogeneity Hospital concentration Frequency of service (volume) Opportunity for upcoding Code fragmentation Commenters pointed out that the IPPS and OPPS payment systems differ in their rate-setting methodologies and that it will be hard for CMS to make accurate comparisons. The agency recognizes this but believes the positive aspects of moving to geometric mean outweigh the negatives and that meaningful comparisons are still possible. The impact of moving to the geometric mean results in APC payment rate fluctuations that hospitals will need to review to determine how the changes will impact their specific book of business in terms of payment increases or decreases in 2013, Shah says. Cost reporting and reimbursement CMS continues to add emphasis in every successive OPPS rule regarding the importance of hospitals accurately coding, pricing, and billing for services. In this year s rule, CMS also discussed the importance of accurate cost reporting. I am concerned with the continued decreases in blood processing APCs and I believe this can be attributed to hospitals not correctly marking up the blood processing fees they are charged by Red Cross, says

3 January 2013 Briefings on APCs Page 3 Rinkle. This is not marking up blood, but rather the blood processing fees. Hospitals also need to review their pricing for new combination codes introduced in the 2013 CPT Manual. I am also very concerned with the number of CPT code changes for 2013, particularly the addition of combination codes such as with cardiac electrophysiology study, Rinkle says. If hospitals do not correctly price these services that is, add the price for the two prior services together then it is likely they will see a significant APC payment decrease for Additional changes CMS finalized a number of other changes, including moving CPT codes into different APCs resulting in both payment increases and decreases. Providers scored one important win when CMS agreed that HCPCS code G0379 (direct admission of patient for hospital observation) should be moved to APC 0608 (Level 5 hospital clinic visits). Facilities expend a comparable amount of resources for both CPT code (office or other outpatient visit for the evaluation and management of a new patient) and HCPCS code G0379. Both will now be in the same APC, so facilities will begin to see higher payment for the direct admit G-code when it is used and does not generate a composite APC. This is a win for hospitals and shows the value of commenting to CMS, Shah says. Prior to 2013, CMS paid facilities at the amount of a low-level E/M visit for a direct referral to observation. Providers pointed out that this was not a low-level service because the facility still had to perform a full workup on the patient. In addition, CMS finalized its proposal to provide an extra, separate payment to providers who use 100% non-heu radioisotopes. It did depart from the proposed explanation of what 100% non-heu means and also agreed with commenters who suggested revising the description of the HCPCS Q-code that must be reported to signify use of non-heu sources. Facilities will receive an additional $10 payment when using 100% non-heu radioisotopes and reporting HCPCS code Q9969. CMS also finalized changes to streamline the operations of Quality Improvement Organizations, increase their transparency, and make them more responsive to beneficiary complaints about quality of care. CMS confirmed the removal of one quality improvement measure for 2013 and did not add any additional quality measures. n 2013 OPPS final rule CMS packaging clarification could raise problems As part of the 2013 OPPS final rule, CMS finalized a clarification to 42 CFR 419.2(b) that could cause confusion in the future if hospitals are audited by third-party payers or by Medicare contractors who do not fully understand the intent of the language or how CMS develops payment rates, says Jugna Shah, MPH, president of Nimitt Consulting based in Washington, D.C. In the 2013 OPPS final rule, CMS states it is clarifying: the regulatory language at 42 CFR 419.2(b) to make explicit that the OPPS payments for the included costs of the nonexclusive list of items and services covered under the OPPS referred to in this paragraph are packaged into the payments for the related procedures or services with which such items and services are provided. CMS statement is technically accurate in that during its rate-setting process packaged items or services from single and pseudo-single procedure claims are taken and allocated to other services, Shah says. However, someone who doesn t understand the OPPS rate-setting process or doesn t realize that just because items are packaged does not mean that they should not be reported consistently

4 Page 4 Briefings on APCs January 2013 could misinterpret the language change to mean that packaged items should not be reported since they are included in related procedures, says Shah. CMS has consistently instructed hospitals to report everything they provide, including packaged items, she adds. If this seems circular and confusing, it is and begs the question of why CMS finalized such a change now, more than 10 years into OPPS. If it s not broke, why fix it, wonders Shah. Shah worries that in the future an auditor or thirdparty payer unfamiliar with the nuances of OPPS might try to tell a facility that it should not bill separately for minor services or procedures whether they are packaged or not if a major procedure is provided on the same date of service because it is related per CMS language change in 42 CFR. CMS fully understands its use and history of packaging and continues to strongly urge hospitals to report all services, including packaged services, Shah stresses. It is not CMS that we have to worry about but rather its contractors who we ve seen misinterpret clear CMS guidance and try to take back money from hospitals when they shouldn t, she says. Shah would have liked CMS to acknowledge commenters concerns about this change and assure the public that it continues to expect hospitals to report all services, regardless of whether they are packaged, related, or unrelated. That way potential future confusion or misinterpretation could be avoided, Shah says. History of OPPS packaging OPPS relies on averages when providing payment. The payment may be more or less than the estimated cost of providing a specific service or bundle of specific services for a particular patient, but reimbursement is sufficient to allow access to quality care. To promote efficient delivery of services, OPPS packages payment for multiple interrelated services into a single payment. OPPS has employed packaging since CMS first implemented the system. In the 2013 OPPS final rule, CMS states that packing encourages hospitals to: Use the most cost-efficient item that meets the patient s needs Negotiate with manufacturers and suppliers to reduce the purchase price of items and services or to explore alternative group purchasing arrangements Establish protocols that ensure that necessary services are furnished, while scrutinizing the services ordered by practitioners to maximize the efficient use of hospital resources In addition, CMS indicates that packaging makes it easier to predict costs. Reporting packaged services CMS has instructed facilities to report all packaged services on the claim so that CMS can use the data for future rate setting, says Shah. CMS does not provide additional payment for the packaged items, but strives to reflect packaged costs into the payment for other services by allocating packaged costs present on single and pseudo-single procedure claims to the main item/service. Without hospital reporting of packaged services either with a revenue code and dollar charge or with a revenue code, HCPCS code, and dollar charge data, CMS would not be able to set appropriate payment rates for significant procedure and other APCs that include packaged costs in the APC rate, says Shah. The list of packaged services remains unchanged. CMS altered the language around the packaged services, and that could potentially cause problems for hospitals when they submit claims to other payers. Another payer or a Recovery Auditor could tell a facility that because the item is packaged, the facility cannot bill for it. If the facility can t bill for it, CMS won t have the data to include when setting the payment for the packaged procedure. The payer could say that the facility cannot unpackage the service and bill separately, but the facility would have to or CMS wouldn t have the data it needs for setting appropriate APC payment rates in the future, Shah says. She uses fludeoxyglucose (FDG) and positron emission tomography (PET) to illustrate the situation. Facilities

5 January 2013 Briefings on APCs Page 5 must report the FDG, which is a radioactive medical imaging chemical, with the PET scan so CMS can include the costs of FDG in the payment for the scan. CMS doesn t pay you separately for the FDG because it is packaged, but if hospitals don t report the FDG on the claim, then CMS won t have the dollars to work into the PET procedure, Shah says. Potential problems down the road Several commenters cautioned CMS about changing the language because of the potential problems with other payers. CMS is technically correct in the wording, Shah says. But I am disappointed that CMS did not appear to understand the spirit of the comments that were submitted, especially in light of the world we live in with the various auditing entities and the hoops that hospitals have to jump through. The comments were really intended to say, Be careful about making this clarification because it could be taken out of context by others and it could wreck havoc on hospitals. CMS could have added a few sentences to reinforce that hospitals need to report the packaged services so CMS will continue to receive the data it needs for rate setting and that the clarification was not meant to say the reporting should not continue. CMS use of the new phrase the payments for which are packaged into the payments for the related procedures or services could also create difficulties for hospitals, says Valerie Rinkle, MPA, vice president of revenue integrity informatics for Health Revenue Assurance Associates in Plantation, Fla. I believe this introduces a more subjective concept into the regulatory language of related, Rinkle says. For 13 years, the OPPS text about packaged services has been unchanged. With OIG, Recovery Auditors, and other auditors not familiar with the regulatory history of OPPS, Rinkle is concerned that this addition opens up the regulatory text to broad interpretation or, more precisely, to misinterpretation. The concern is that in a single encounter, a reviewer unfamiliar with CPT coding concepts could assert that every individually billed service is related to one of the other services and deny legitimate separate line items billed and paid under OPPS, she says. CMS said that this phrase is consistent with current and long-standing policy regarding packaging and does not introduce any new concepts, so the agency finalized the change. n 2013 Medicare Physician Fee Schedule Hospitals see therapy, molecular pathology changes The biggest operational change for outpatient facilities for 2013 does not appear in the 2013 OPPS final rule. Instead, CMS announced changes to reporting therapy services in the 2013 Medicare Physician Fee Schedule (MPFS) final rule. For the last several years the provider community has had to read both rules to find all of the changes that impact hospitals, says Jugna Shah, MPH, president of Nimitt Consulting based in Washington, D.C. This might seem unintuitive, but CMS addresses issues in whichever rule it uses to make the payment, and since always therapy services are paid under the Physician Fee Schedule, that s where hospitals will have to look to understand the new rules they will be expected to abide by in Most hospitals do not have the staff capacity to read through every rule each year with proposed and final rules for OPPS, IPPS, and MPFS, that s six rules per year, each usually topping 1,000 pages, says Valerie Rinkle, MPA, vice president of revenue integrity informatics for Health Revenue Assurance Associates in Plantation, Fla. Therapy services Therapy departments need to digest the rules carefully to comply with reporting requirements for new HCPCS

6 Page 6 Briefings on APCs January 2013 G-codes and complexity/severity modifiers and to provide complete documentation for these services when provided starting in CY While CMS detailed how its current coverage and documentation requirements relate to the new code requirements on claims, the detail involved is significant, says Rinkle. Therapy staff must be trained to document and capture the correct functional status, goal, and modifier codes, Rinkle says. In addition, hospital chargemasters will have significant volumes of penny-priced services to populate claims. Automatically capturing these codes from documentation will not be easy, Rinkle says. Facilities likely will need to use manual processes for many months before they can update their electronic medical record (EMR) systems to capture the codes properly from documentation. There could be a productivity loss for therapists, charge capture staff, and billing staff as they all get used to these new code and claim requirements, Rinkle says. CMS is required by law to implement a claims-based data collection strategy for therapy services for information about: Beneficiary function and condition Therapy services furnished Outcomes achieved Medicare expects to use this information in reforming the payment system for outpatient therapy services in the future. By collecting data on beneficiary function over an episode of therapy services, CMS hopes to better understand who uses therapy services and how a patient s functional limitations change over time as a result of receiving therapy. All this data gathering comes with the long-term goal of developing an improved payment system for therapy services that pays appropriately for efficient, effective services without encouraging the provision of medically unnecessary or excessive services, says Shah. All of the requirements that hospitals need to be aware of are outlined in the MPFS. We are likely to see more information from CMS in upcoming transmittals and Medlearn Matters articles, but in order to begin making operational changes now to be ready for January 1, hospitals should read the therapy services section of the Physician Fee Schedule final rule now, Shah says. The requirements go live January 1, but hospitals have a six-month testing period. They will not be penalized for not following the requirements until July 1. This really is the single largest operational change that will impact hospitals in terms of the OPPS and MPFS final rules, so therapy departments should get people on board and educated as early as possible and also discuss the necessary chargemaster changes that will accompany the use of the new G-codes, Shah says. Molecular pathology payments Another significant change also comes from the MPFS regarding coding and payment for molecular pathology services. Over the past two years the AMA has made significant additions to the molecular pathology CPT codes, which first appeared in the 2012 book and are expanded in the 2013 CPT Manual. CMS will pay for the new Molecular Pathology CPT codes under the Clinical Laboratory Fee Schedule (CLFS) instead of the MPFS. This issue has been under great debate for the last two years, which is why CMS in CY 2012 continued to allow hospitals to report existing stacking codes. That changes as of January 1, 2013, when the stacking codes will be deleted and replaced with more than 115 new codes that will go live and be paid under the CLFS, Shah says. The new molecular pathology codes, while significant in terms of the number of codes, are actually simpler than the stacking codes, which were very difficult for hospital systems to operationalize, Rinkle says. Many providers were disappointed that CMS stated, in the final rule, that the molecular pathology CPT codes describe clinical diagnostic laboratory tests that should be

7 January 2013 Briefings on APCs Page 7 paid under the CLFS because these services do not ordinarily require interpretation by a physician to produce a meaningful result, says Shah. Providers would contend that many tests, specifically oncology-related molecular pathology tests, always involve a physician s interpretation and report to guide the patient s treatment appropriately. Despite CMS statements, it does recognize that, in some cases, physician interpretation of a molecular pathology test may be medically necessary to provide a clinically meaningful, beneficiary-specific result. CMS created HCPCS code G0452 (molecular pathology procedure; physician interpretation and report) to replace the current interpretation and report CPT code CMS states that it does not expect to see this code reported very often and will monitor to ensure it is only being used when interpretation and report by a physician is medically necessary and not duplicative of laboratory reporting paid under the CLFS. Providers intending to use this code should develop internal policies and procedure and documentation guidance for its physicians, and also discuss all of this with their compliance officer, says Shah. Providers need to update their chargemasters for the new codes and develop appropriate dollar charges, Shah says. Setting appropriate charges could be a huge challenge for those who have not already been thinking about and working on this issue. No crosswalks exist from the nonspecific stacking codes to the new CPT codes, Shah says. Using templates CMS includes in the MPFS a notable comment about its stance on templates, Rinkle says. On p. 778, CMS states: However, we do not prohibit the use of templates to facilitate recordkeeping. We also do not endorse or approve any particular templates. A physician or practitioner may choose any template to assist in documenting medical infor mation. We do caution, however, that some templates provide limited options and/or space for the collection of information such as by using check boxes, predefined answers, and limited space to enter information. We discourage the use of such templates. Our experience with claim review shows that limited space templates often fail to capture sufficient detailed clinical information to demonstrate that all coverage and coding requirements are met. Furthermore, physicians or practitioners should be aware that templates designed to gather selected information primarily for reimbursement purposes are often insufficient to demonstrate that all coverage and coding requirements are met. These limited space documents often do not provide sufficient comprehensive information to adequately show that the medical necessity criteria for the item/service have been met. This is a response to a comment regarding the new requirements for durable medical equipment orders validated by physicians, but the CMS answer speaks more broadly to how it feels about templates particularly in light of the joint DHHS/DOJ letter to AHA and other hospital associations on the upcoding it is seeing from EMRs, Rinkle says. Providers should take the language to heart, and use this as a clue to what CMS expectations regarding templates are, says Shah. n Begin teaching providers to speak ICD-10 Providers and coders seem to speak two different languages clinical and coding. Providers already have issues parsing ICD-9-CM coder speak, so how can you get them to understand ICD-10? It can seem like a daunting task, but having a plan will make training easier, says Rachel Commons Chebeleu, MBA, RHIA, director of the professional fee abstraction and HIM departments at the Hospital of the University of Pennsylvania. Documentation is the center of everything coding,

8 Page 8 Briefings on APCs January 2013 case-mix index (CMI), continuity of care, and quality measures, says Chebeleu. Because documentation has far-reaching implications, it must be accurate and complete. The transition to ICD-10 will affect coders and providers the most, she says. Organizations have more control of coder training because they employ the coders and can dictate how much time coders spend training for ICD-10. Physicians, on the other hand, might or might not be employed at a facility they may be contractors or merely hold privileges there. That gives the organization almost no control over what requirements they can place on providers, Chebeleu says. Organizations also have less time with physicians and often can t bring someone in to cover for a physician who is learning about ICD-10. Dangers of doing nothing It s a mistake not to provide physician training, however, says Scot Nemchik, CCS, CIRCC, AHIMAapproved ICD-10 trainer and vice president of compliance and strategic planning for IOD, Inc., in Green Bay, Wis. In year one, organizations may not see an adverse effect from using unspecified ICD-10-CM codes, Nemchik says. However, increased specificity is one of the main reasons for the move to ICD-10. If we see a profligate use of unspecified ICD-10 codes, CMS will probably take action, he says. In addition, if providers aren t documenting adequately, coders will need to send more queries. Time the record spends in the query queue is time money does not spend in the bank fund, Nemchik says. How to train physicians When it comes to documentation for ICD-10, avoid taking too broad an approach, says Nemchik; instead, assess the current landscape of your documentation. It s possible that physicians are already providing the information you need to properly code in ICD-10. That means there s no need to bring up documentation with physicians unless it s lacking. If providers already document laterality, for example, don t discuss it with them. Identify which providers need education and determine exactly what they need to do differently, Nemchik says. Drill down to what they care about, he adds. For instance, consider the changes to gastrointestinal coding. In ICD-10-CM, coders will have 576 gastrointestinal codes to report. However, most of the diagnoses will be concentrated in 167 codes so explain what physicians need to document for that subset rather than trying to cover every single code that s available. The conversation just collapsed in scope, Nemchik says. Teach them how to navigate ICD-10 in small numbers. Overcome physicians conception of ICD-10 as a worthless, burdensome waste of time and effort, Nemchik says. This may not be an easy task, especially given the AMA s opposition to the system. Let the physicians know they don t have to learn the codes. Instead, focus on what they really need to know about ICD-10 and how their current documentation practices will need to change. Don t go into the staff meeting with your guns blazing, Nemchik warns. Instead, consider these seven suggestions to train physicians: 1. Remind physicians that good documentation is not a new concept, says Nemchik. 2. When you talk to physicians, make sure you re speaking their language and not using coder speak. Focus on what is relevant to their specialty or practice. 3. Conduct concurrent chart reviews rather than retrospective reviews. If you can get face time with physicians while they are treating patients, it makes for a better learning process, Chebeleu says. 4. If you must conduct retrospective reviews, make them painless. Simplify the process as much as possible for physicians. 5. Explain that there s something in it for the physicians. This might be a tough sell, but it s essential if you re going to get physicians to buy in to ICD-10 and the need for training. 6. Include ICD-10 distinctions in forms and templates. 7. Make sure you can determine whether your plan is actually working. If you can t measure how well the plan is working, you also can t monitor whether physicians are getting better at documenting. n

9 January 2013 Briefings on APCs Page 9 Reporting fetal ultrasound codes Q Can you explain some situations when it is appropriate to use ICD-9 code V28.4 (antenatal screening for fetal growth retardation using ultrasonics)? We have been using it along with V28.81 (encounter for fetal anatomic survey) when an antenatal screening ultrasound is done and the ordering physician states growth and anatomy. The radiologist documents such things as fetal size, survey of fetal anatomy, amniotic fluid index, fetal position, placental position, etc. One of our coders does not think V28.4 is appropriate because she does not like the word retardation in the code title. I have explained that this is not referring to mental retardation, but to the fact that a screening is being done to make sure the growth is not less than normal. Are we using this code correctly? A Code V28.4 represents the provider/physician screening the fetus for an in-utero fetal growth retardation with ultrasound. The word retardation is used to denote whether the fetus is growing appropriately. It is not meant to indicate a neonate/child/adult diagnosed with a brain dysfunction/disorder that is related to mental retardation or a brain injury at birth (asphyxia). The usage of codes V28.4 and V28.81 is appropriate as they are screening for anomalies. You can find additional information about the phe nomenon the physician is screening for at www. healthofchildren.com/i-k/intrauterine-growth-retardation. html. The site includes this definition: The term intrauterine growth retardation (also known as intrauterine growth restriction) (IUGR) is generically defined as a fetus who is at or below the tenth percentile in weight for its gestational age. There are two factors necessary to define an IUGR fetus: first, the fetal weight is at or below the tenth percentile for gestational age and sex; second, there is a pathological process present that prevents expression of normal growth potential. If the baby is small given its in utero age, then it is said to be small for gestational age (SGA). Bell curve for E/M visits Q Are we still required to maintain the bell curve distribution of E/M levels? We were recently told that everyone s bell curve is skewed to the right with more and than We use a point system that was developed to get us to the curve, but now we are showing a skew to the right. Do you have any recommendations as to how we should address this? We tried to use ACEP a couple of years ago but we could never achieve the bell curve using it. A Although CMS has discussed bell curves and normal distributions for ED visit levels, this was never one of the requirements in the CMS guidelines for outpatient coding methodologies. CMS provided the following guidelines for providers in 2008 and they have not changed since: A hospital s methodology should: 1. Follow the intent of the CPT codes reasonably relating the intensity of hospital resources to the levels of effort represented by the codes 2. Be based on hospital facility resources, not on physician resources 3. Be clear to facilitate accurate payments and be usable for compliance purposes and audits 4. Meet the HIPAA requirements 5. Only require documentation that is clinically necessary for patient care 6. Not facilitate upcoding or gaming 7. Be written or recorded, well documented and provide the basis for selection of a specific code 8. Be applied consistently across patients in the ED or clinic to which they apply 9. Not change with great frequency 10. Be readily available for FI (or if applicable) MAC review 11. Result in codes that could be verified by other hospital staff, as well as outside sources

10 Page 10 Briefings on APCs January 2013 CMS also stated the following on p of the November 27, 2007, Federal Register: We would not expect individual hospitals to necessarily experience a normal distribution of visit levels across their claims, although we would expect a normal distribution across all hospitals as currently observed and as we would also expect if national guidelines were implemented. We understand that, based on different patterns of care, we could expect that a small community hospital might provide a greater percentage of low-level services than high-level services, while an academic medical center or trauma center might provide a greater percentage of high-level services than low-level services. CMS published the ED visit level distribution graph on p of the November 27, 2007, OPPS final rule. In the discussion accompanying the graph on p , CMS acknowledged that the individual hospital distributions may vary. In determining whether the methodology you are using is appropriately measuring resource utilization, you Contributors We would like to thank the following contributors for answering the questions that appear on pp. 9 10: Candace E. Shaeffer, RN, MBA, RHIA Chief Compliance Officer, Financial Performance Solutions LYNX, part of OptumInsight Bellevue, Wash. Lori-Lynne A. Webb, CHDA, CCS-P, CCP, CPC, COBGC, AHIMA-Approved ICD-10 Trainer Coder St. Alphonsus Regional Medical Center Boise, Idaho Denise Williams, RN, CPC-H Director of Revenue Integrity Services Health Revenue Assurance Associates, Inc. Plantation, Fla. will want to make sure that it follows the 11 CMS guidelines noted previously; you will also want to validate that it results in a distribution of visit levels that accurately reflects your ED s patient population, patterns of care, and resource characteristics. Billing for wasted drugs Q A patient comes in for a Herceptin infusion. The pharmacist mixes the infusion and sends it to us to administer. They document the wastage and bill for the total amount of drug given and amount wasted. This is not for every patient, just the last patient for whom we use the vial. Can we bill for the amount of the drug we waste? A The key to billing for the amount of drug that is wasted is based on whether the drug is provided in a single-use vial or a multiuse vial. When a drug is provided in a single-use vial or other packaging, you should report the amount of drug wasted/discarded, and if the drug is separately payable under the OPPS, you will receive payment for the discarded amount. However, this same scenario is not true for drugs provided in multiuse vials or other packaging. Multiuse vials are designed for multiple uses over a period of time, and Medicare coverage does not extend to any amount of the drug discarded from a multiuse vial. CMS provides specific guidance in the Claims Processing Manual, Chapter 17, section 40: When a physician, hospital or other provider or supplier must discard the remainder of a single use vial or other single use package after administering a dose/quantity of the drug or biological to a Medicare patient, the program provides payment for the amount of drug or biological discarded as well as the dose administered, up to the amount of the drug or biological as indicated on the vial or package label. NOTE: Multi-use vials are not subject to payment for discarded amounts of drug or biological. Herceptin (trastuzumab) is supplied in a multiuse vial and contains more than one dose of medication. The

11 January 2013 Briefings on APCs Page 11 medication in the vial is reconstituted and when stored properly, can be utilized over a period of 28 days. Medicare will reimburse only for the amount of drug that is given to each patient. You should not separately report any amount discarded at the end of the viable period. The accurate reporting of units for drugs and biologicals is a hot topic on the OIG s radar screen. Every facility should audit a sample of claims to ensure that the documentation in the record of the drug administered supports the number of units reported. Your pharmacy department can assist with identification of drugs/ biological provided in single-use vs. multiuse vials. n Briefings on APCs 2012 index Billing Correctly bill ancillary bedside procedures in addition to the room rate. March, p. 1. Defining integral tricky for self-administered drugs. Feb., p. 8. Determine when to charge inpatient supplies separately. April, p. 1. Unravel complexities of billing self-administered drugs. Nov., p. 1. What CMS actually says about billing ancillary procedures. March, p. 4. Coding Q&A Appending modifier -59 for MRI and MRA. Oct., p. 9. Appropriate reporting of IV push followed by infusion of the same drug. July, p. 12. Assigning modifier -52 for cancelled procedures. May, p. 10. Average time for CPT initial observation codes. April, p. 11. Billing for fluoroscopy. Nov., p. 10. Billing the technical component of pathology services. Aug., p. 12. Carve out time for infusions. Feb., p. 11. Charging for venipunctures. Oct., p. 9. Coding for amputation of finger and aftercare. June, p. 11. Coding for diabetes in ICD-10-CM. April, p. 10. Coding for hysteroscopy prior to ablation. Oct., p. 9. Coding for infusions used to correct low potassium levels. July, p. 10. Coding for negative pressure wound therapy. Aug., p. 11. Coding for sequential infusions. Sept., p. 10. Coding for toxic metabolic encephalopathy. Oct., p. 12. Coding for unsuccessful foreign body removal. May, p. 10. Coding for wound care with no-cost skin substitute. Dec., p. 11. Coding image-guided lumbar decompression. Jan., p. 10. Correctly determining billing units for drugs. Nov., p. 10. Correct use of modifier -PD. July, p. 10. Correct use of modifiers -FB and -FC. March, p. 11. Deducting push time from infusions. April, p. 11. Determining ED visit level. Jan., p. 8. Differentiate between modifiers -AS, -80. July, p. 12. Differentiating between modifiers -52, -73, -74. Aug., p. 11. Facility codes for peritoneal dialysis. June, p. 12. Incomplete documentation for IV infusions. June, p. 10. Modifier -59 and infusion therapy. Oct., p. 11. New composite codes for May, p. 12. New drug HCPCS codes. Sept., p. 12. New HCPCS codes for April. May, p. 11. Observation orders. Dec., p. 10. Open reduction and internal fixation of a radius fracture. Jan., p. 9. Payment for critical care and separately reported services. Nov., p. 11. Payment for HCPCS code J2354. July, p. 11. Payment for items in OPPS Addendum B. June, p. 10. Payment for skin substitutes. June, p. 10.

12 Page 12 Briefings on APCs January 2013 Procedures on the inpatient-only list. Sept., p. 11. Protocol for pulmonary function test. Feb., p. 11. Replacement code for C9732. Sept., p. 12. Reporting cardiac rehab, physical therapy. Dec., p. 12. Reporting dialysis for ESRD patient in ED. Sept., p. 10. Reporting HCPCS codes for drugs that aren t separately payable under OPPS. April, p. 10. Reporting hydration with phlebotomy. Feb., p. 12. Reporting limits for doses of Provenge. Oct., p. 11. Reporting molecular pathology codes. March, p. 10. Reporting TEE pre- and postoperatively. Oct., p. 11. Reporting vaccine administration codes. May, p. 11. Sequencing additional diagnoses. Dec., p. 10. Therapy caps under OPPS. Oct., p. 10. CPT coding Catch up on what s new with injections and infusions. May, p. 1. Code and guideline changes spread throughout surgery subsections. Feb., p. 1. Coders need to learn to read an OP report. July, p. 7. Differentiate between correct coding, mutually exclusive edits. Aug., p. 5. Differentiate between types of wound debridement. July, p. 5. Ensure accurate reporting and coding of critical care. Oct., p. 1. Factor in appropriate resources for ED E/M criteria. Aug., p. 6. Injections and infusions continue to confuse coders. June, p. 1. Note major updates to pathology and laboratory section of CPT Manual. Feb., p. 6. Simplify chronic kidney disease coding. Oct., p. 7. Simplify diagnostic, procedural pain management coding. July, p. 1. Walk through observation case studies. Dec., p. 6. I/OCE CMS adds new modifier, edits, and APCs. March, p. 8. Device-to-procedure edit reinstated, new codes added. Aug., p. 9. Note changes for skin substitutes, mental health codes. June, p. 7. October I/OCE update includes minor changes. Nov., p. 7. ICD-10 Compare coding for diabetes in ICD-9-CM, ICD-10-CM. Sept., p. 7. Compare ICD-9-CM, ICD-10-CM coding for spinal conditions. May, p. 7. Consider dual coding to prepare for ICD-10 transition. Dec., p. 4. Fracture coding in ICD-10-CM requires greater specificity. May, p. 4. HHS proposes one-year delay for ICD-10. June, p. 9. ICD-10 anatomy refresher: Get to know the skull. June, p. 4. ICD-10 anatomy refresher: Respiratory system. March, p. 6. ICD-10 anatomy refresher: Shoulder. Oct., p. 4. ICD-10 anatomy refresher: Take a trip through the digestive system. April, p. 4. ICD-10-CM coding: Start with the structure. April, p. 7. Time to reboot ICD-10 transition. Nov., p. 8. Modifiers Reduce compliance risk by correctly appending modifier -25 for E/M visits. Dec., p. 1. Simplify the decision to use modifier -59. Aug., p. 1. OPPS CMS finalizes numerous provider-friendly OPPS changes for CY Jan., p. 1. CMS issues supervision decisions on Hospital Outpatient Payment Panel. Dec., p. 8. CMS plans major changes to payment calculations. Sept., p. 1. Reevaluate charge setting in light of 2012 OPPS final rule. Jan., p. 5. Supervision delay extension for CAHs among proposals. Sept., p. 4. n