Coding: No longer the red-headed stepchild

Administrator’s role can affect the bottom line

Coding once was an abbreviated way to get claims processed. Now, as many providers begin to experience a cash pinch, coding administrators are being asked to identify areas related to coding that can affect cash flow. Consequently, although many administrators don’t realize it, their roles are expanding into all parts of the organization.

"The trend is when the money isn’t coming in, it must be coding," explains Lynne Northcutt-Greager, CPC, a consultant with Medical Group Management Association in Englewood, CO.

However, this can be a correct assumption. For instance, coding obviously affects reimbursement and a provider’s vulnerability to fraud and abuse charges. And if a provider starts getting claim denials and has to file appeals, both staff and physicians will spend more time on the claims and will incur additional costs.

There are other reasons to make sure your coding department is in tip-top shape, notes Northcutt-Greager. Other areas that coding can affect include:

Configuration of computer information files.

"You have to know if your master files are loaded correctly," she says. "You have to have a system in place for getting coding updates into the system, and you have to have your pricing linked to coding."

Employee training.

Providers have to consider audits to ensure the coding is accurate, and staff needed to perform them, she says. "Can you handle it internally, or do you have to bring in someone from outside? If you do it internally, what kind of expertise do the auditors have to have and do you have to invest in additional education for these people?"

Allotment of office space.

"How much space in the office do you have to allocate for functions related to what we normally think of as billing?" she asks. Providers need to have resource books for coding manuals and bulletins that come from the various payers so staff can follow appropriate coding guidelines. "More and more [providers] are finding they have less and less space because of all the coding materials."

Even with many of these considerations, many administrators still operate with blinders, she says. "[In their eyes], the coding people are just supposed to look at a service and assign a three- to five-digit diagnosis code and a five-digit procedure code and send it on its way. They are supposed to assign so many per hour that they have set up for their standards."

Isolation breeds problems

This view of coding employees working in isolation from other areas in the organization can keep administrators from recognizing common coding-related problems. For example, Northcutt-Greager says she is seeing more of the problem of outside billing services changing procedure codes. The providers often don’t realize the codes are being changed until an auditor or Medicare representative finds the problem. "Maybe [the billing services] can’t get a code in the system because the charge ticket hasn’t been updated because someone hasn’t coordinated printing. So they look back in the system and see that the person was in for low back pain before, and they use that code when the person had a foot X-ray. They don’t realize it’s not even related."

She also suggests providers keep an eye on coding completed by physicians. "Right now, a lot of physicians are getting reimbursed based on productivity that is contingent upon relative values. If not because of fraud and abuse issues, you want to make sure your physicians are coding accurately so their compensation is accurate."

Some providers have more of a problem with physician coding inaccuracy than others, she adds. Physicians, for example, may be coding accurately based on current coding guidelines. Or they may be coding higher levels of service since their compensation is being based on productivity. They may also be "downcoding" and using lower levels of service because they want to stay out of trouble with Medicare.

The end result is that physicians may adversely affect their compensation by not showing their true productivity. The inaccurate coding affects administrative decisions, as well.

"Some administrators are looking at relative values or production and trying to determine staffing and budget needs," Northcutt-Greager says. "If physicians are not coding correctly or if the rest of coding isn’t taking place accurately through coders or billers, then administrators don’t have valid data to make these decisions. Then they wonder why their decision-making processes don’t seem right.

"Everything you turn around, it is something else that is tied into coding," she continues. "The more you think about it, the more it mushrooms."

Be the focal point

In today’s health care environment, administrators should have an awareness of all the areas that impact coding and vice versa, Northcutt-Greager says. For example, here are some questions administrators should have asked themselves regarding the changes from the 1999 updates:

• Do any of the new or deleted diagnosis or procedure codes impact us?
• If so, what are we doing to set our fees?
• Do we have the codes in the computer system?
• Do we need to have them on our charge tickets?
• Do we need to do training related to them?
• Do Medicare or other payers have any special benefit limitations?
• Are some of the payers going to delay activating that code until the second quarter of the year?

Administrators also need to get feedback from the employees doing the coding. "Ask them what they are seeing," Northcutt-Greager says. If administrators are finding problems in turnaround and production, try to discern why.

"Is it because a code isn’t loaded in the system?" she asks. "If the code isn’t loaded in the system, why not? Is it because there is a problem with the process, and maybe you only have someone assigned to do coding updates when they don’t have anything else to do? And how are you ensuring that all of these activities take place in a timely manner?"

Administrators should act as the focal point so everything related to coding works through them, Northcutt-Greager advises. That way, they can get the overall picture of how well the pieces are working together.