ED managers: Teamwork is key to success with APCs

Although the switch to ambulatory payment classifications (APCs) proposed by the Baltimore-based Health Care Financing Administration (HCFA) has been delayed, experts interviewed by ED Management warn that you need to prepare by collaborating with other hospital departments. Your success with APCs will depend on it, emphasizes Caral Edelberg, CPC, CCS-P, president of Medical Management Resources in Jacksonville, FL. (See guest column on APCs and prospective payment, p. 18.)

On Sept. 8, 1998, HCFA published proposed rules for the mandated prospective payment system and requested public comment. Recent amendments to the Balanced Budget Act specified a phased-in approach to APCs. "There will also be numerous revisions that spell relief for hospitals across the country," reports Edelberg. (For more information about APCs, see ED Management, January 2000, p. 9, and August 1999, p. 85.)

"At this point in time, considering HCFA’s full plate of Y2K and APC issues, APC implementation by July 1, 2000, without extraordinary effort and risk of problems, seems unlikely," she says.

Implementation by that date also would be politically troublesome, given the wide range of complaints and concerns voiced by providers and insurers, she notes. "The Health and Human Services Secretary is discouraged from implementation until more current data is available."

Because of the delay, there is lots of speculation about implementation dates. "My guess is that HCFA will wait to see what Y2K issues arise after the first of the year before scheduling revisions to the APC process," says Edelberg.

Despite the delay, some experts are still predicting a July 2000 date for implementation. "As far as we know, the final rule is still supposed to be published by the end of February 2000," states Mason Smith, MD, FACEP, president and CEO of Lynx Medical Systems, a Bellevue, WA-based consulting firm specializing in coding and reimbursement for emergency medicine. "If HCFA fails to do that, then we anticipate the final rule won’t be published until July 2000."

The Medicare carriers will have to ensure that their systems and training will address the process as finally determined, notes Edelberg. "I can’t see it happening before fall 2000, and there is the potential for 2001."

In the meantime, don’t put preparation on the back burner, she warns. "You should take time now to begin addressing the issues associated with APCs and the requirements they will place on documentation and coding of outpatient services."

Prepare to meet the challenges of APCs in these three key areas, she advises:

• improved documentation of both physician and nursing services;

• assurances of efficient information flow to facilitate charge capture;

• timely claim submission of all charge information.

The delay in APCs provides time for ED managers to develop a more organized approach to the information flow from the ED to the business office, which will be dramatically affected by APCs, Edelberg predicts.

Here is what you should be doing to take advantage of the delay:

Meet with the coders in your billing office or medical records department. Review the basic information needed to code the records appropriately. "Many medical records departments continue to have problems with complete and/or legible medical records," Edelberg notes.

Address late charges. Ensure that ED charts are completed and sent to the medical records department so that the record can be reviewed for complete charge capture, she says. "This is not just for the physician information but the nursing information as well."

If the physician records are held up, and hospital-related billing information is dependent on the physician diagnosis, it will hold up everything, she says. "Under APCs, all hospital charges will need to be reviewed and billed at the same time. Any late charges just won’t get paid."

Prepare for interdependence between departments. The APC system will mandate better cooperation among all hospital departments, she says. "The physician documentation will be critical to the overall success of each hospital’s experience with APCs."

The medical records departments will have to make a fairly significant transition to a new process, she notes. "It is so unfortunate that so many hospitals have experienced staff reductions, particularly in medical records departments. You will need all the help you can get from medical records, working in cooperation with the business office, to ensure that coding is performed accurately and charges are paid."

During such a dramatic transition, the business office will have to provide a significant amount of feedback to medical records on how charges are being paid by Medicare under the APC system, Edelberg says. "This is so that medical records [staff] can ensure that their coding is correct."

Medical records should be provided with examples of payment remittances and inservices on how to read them if necessary, she explains. "Routine meetings between business office and medical records representatives should include discussion of payment problems resulting from code assignment." Consider using a payment grid that lists the payment amounts by major payer for each of the major procedure codes or service types, with special notations on payment amounts when certain procedures or services are combined, she suggests. "In addition, it is helpful to maintain a list of diagnoses that are routinely downcoded as non-emergencies’ to identify when claims are downcoded inappropriately." Payers don’t often pass fair judgment on the medical necessity of emergency treatment and may need to be reminded about the prudent layperson standards of payment, Edelberg stresses.

In general, the transition to APCs promises to be difficult with limited time to gear up and fine-tune once the final rule is published, she says. "The key will be open communication between hospital departments with efficient recognition and resolution of problems as they occur."