New product evaluates chargemaster accuracy

Once ignored, it now has a high profile

Pushed to the forefront by ambulatory payment classifications (APCs), the hospital chargemaster is becoming more of a focus for providers who worry about maintaining integrity. Now a new product evaluates a hospital’s chargemaster and offers consulting and education services to help make the chargemaster maintenance process easier.

"For years people have ignored the content of the chargemaster because so many individual charges are included when billed on the UB-92," says Darice Grzybowski, MA, RHIA, national manager of HIM industry relations for 3M Health Information Systems (HIS) in Salt Lake City. "Unless an audit was done, people didn’t pay much attention to each individual line item."

Business office staff might also write off certain bill items that were denied or rejected if they were below a certain dollar amount, she adds. "A lot of the items that were smaller dollar charges, even though they were used frequently, got ignored."

The time to address the problem — while providers were learning how important coding process integrity is to outpatient reimbursement — seemed to be ideal. The chargemaster has importance in its own right, Grzybowski says. It has a direct impact on reimbursement because APCs for Medicare outpatient reimbursement depend so heavily on the accuracy of each individual charge line item. Line-item data for non-Medicare patients also is used in gathering data for critical pathways. "People look at charge variances when they design critical paths."

Hospitals monitor individual charges in line items for physician credentialing, as well, Grzybowski says. "For example, if a radiologist has performed X amount of procedures, how are they captured? Usually through the individual charge line items."

In developing its chargemaster product, 3M HIS knew that the superbills physicians used in hospitals were not always being maintained, she says. Charge slips were not being kept up to date. "We found that there were a lot of manual processes that had to happen correctly if the charge description master was to be as accurate as possible."

Details of the software tools

In developing the Chargemaster Manager software, 3M HIS looked at operational and process problems associated with the hospital chargemaster. The software provides three tools to address these needs:

A tool to help identify any potential accuracy issues in the billing and coding process for line items included in the chargemaster.

"We know from our studies that approximately 80% of all problems that occur on outpatient bills occur at the charge line-item detail level," says Grzybowski. These problems include wrong HCFA Common Procedure Coding System codes or revenue codes.

This tool in the software identifies inaccuracies, she explains. It looks for deleted Current Procedural Terminology codes or inaccurate revenue codes. "The software has an impact on hospitals because the job of maintaining the chargemaster oftentimes falls in the hands of the HIM department," she says. "[HIM professionals] would look at it and be faced with this huge stack of green-bar papers, and they would have to go through them line by line. By automating that process and having the software scan the chargemaster, much cleaner bills are produced."

A compliance or alert feature that identifies any problems of bundling/unbundling or Office of Inspector General focus reviews.

This tool alerts the people who are maintaining the chargemaster of potential compliance problems, Grzybowski says. "Chargemasters are linked with order-entry systems and legacy systems like lab and radiology," she explains. "If you can alert someone to a problem, it may help change the processes in your facility." The software also provides a way to track compliance issues.

A tool that helps identify legitimate missed-revenue opportunities.

"One of the frustrations, especially for smaller hospitals, is not knowing what other facilities do, and whether they are actually building the chargemaster correctly," Grzybowski says. "We have built features into the software to help identify best practices and missed opportunities for legitimate bundling and unbundling of charge codes."

Three parts of the package

The Web-based software is like a working environment, Grzybowski says. "It doesn’t sit on the live chargemaster. It sits outside the live chargemaster to be used as a test and edit environment, in order to protect the integrity of the live system."

Providers will quickly see benefits from the chargemaster review. "It’s almost an immediate return on investment," she says. "That’s opposed to the use of consulting audits alone, which might take six months before you see a change happen."

While the software gives providers the ongoing knowledge that is often missed when they only do annual reviews of their chargemaster, it is also important for providers to take the information that they receive from the software and use it to improve processes. "[Using this information], they should restructure the way departments charge and use their order-entry systems," Grzybowski says.

To help educate the staff and to put changes indicated by the software into place, 3M offers a complementary consulting service. An outside consultant with knowledge in chargemaster processes may have more success influencing the clinical areas and making change happen than employees on the financial side who have other duties, Grzybowski explains. "We wouldn’t recommend just consulting or just the software for most customers. Our recommendation is to do both together to optimize the benefit of the software."

When working with hospitals, consultants review the initial results from the software and work with the staff to address specific problems that have been identified. Reviews can take place on a quarterly or annual basis. The reviews can also help identify areas for process improvement.

In addition to software and consulting, 3M also offers web-based learning tools. "We have multiple lessons in chargemaster maintenance," says Grzybowski. "You can go down to the working level of the people who are involved in maintaining it and get them to understand the importance and the level of detail involved in building and maintaining an accurate chargemaster."