Outpatient Procedural Coding

1
Chapter 18

• Outpatient Procedural Coding

2
Physicians Current Procedural Terminology

• Physicians Current Procedural Terminology (CPT)
  is a comprehensive listing of procedures and
  services provided by physicians.
• Originally focused on surgical procedures
• Updated every December

3
Physicians Current Procedural Terminology
(continued)

• The aim of CPT-4 was to establish a way for
  interested parties to know what procedures and
  services had been provided to the patient without
  reading a lengthy report.
• Allows insurance companies to
• Communicate with each other
• Compare reimbursable amounts
• Speed claims processing

4
Physicians Current Procedural Terminology
(continued)

• CPT-4 system uses five-digit numeric codes and
  corresponding meanings
• Codes describe specific procedures, services, or
  supplies provided by physicians
• Used in both inpatient and outpatient settings

5
Physicians Current Procedural Terminology
(continued)

• CPT-4 divided into six sections
• Evaluation and management
• Anesthesia
• Surgery
• Radiology
• Pathology and laboratory
• Medicine

6
Reading Descriptors

• Read up to semicolon look down for any
  indentations using same words before the semicolon

7
Guidelines

• Sections begin with specific guidelines and
  applicable procedures and services
• Guidelines contain
• Definitions
• Explanatory notes
• Listing of previously unlisted procedures
• Directions for filing a special report
• Modifiers

8
Unlisted Procedures and Special Reports

• CPT provides unlisted codes at the beginning of
  each section
• Used if service performed is not listed in CPT
• Provide copy of procedure report with claim when
  unlisted code used

9
Unlisted Procedures and Special Reports
(continued)

• Report should include
• Definition of nature, extent, and need of
  procedure
• Time, effort, and equipment necessary
• Complexity of symptoms
• Final diagnosis
• Physical findings
• Diagnostic and therapeutic procedures
• Concurrent problems
• Follow-up care

10
Evaluation and Management Codes

• Five-digit codes beginning with 9
• E/M codes describe various patient histories,
  examinations, and decisions physicians must make
  in evaluating and treating patients in various
  settings (e.g., office, outpatient, hospital).
• Documentation must enable physician and coder to
  decide which code to use

11
Evaluation and Management Codes (continued)

• To code service described, record must indicate
  key components present
• Two of three key components for established
  patients
• Three of three key components for new patients

12
Evaluation and Management Codes (continued)

• Components elements that make up a visit
• History
• Physical examination
• Medical decision making
• Counseling
• Coordination of care
• Nature of presenting problem
• Time

13
Evaluation and Management Codes (continued)

• Key components
• History
• Physical examination
• Medical decision making
• All other components are contributing elements

14
Evaluation and Management Codes (continued)

• Four classifications of history and physical
  examination described in CPT-4
• Problem-focused
• Expanded problem-focused
• Detailed
• Comprehensive

15
Evaluation and Management Codes (continued)

• Medical decision making what physician must do
  to reach diagnosis
• Categorized as
• Straightforward
• Low complexity
• Moderate complexity
• High complexity

16
Evaluation and Management Codes (continued)

• When time spent with the patient is more than 50
  of the typical time for the visit, time becomes
  the deciding factor for choosing an E/M code.
• Other considerations
• In-hospital care codes
• Emergency department codes

17
Checkpoint Question 1

• To code for a service in the E/M section, two of
  the three key components must be present for an
  established patient, and all three must be
  present for a new patient. What are the three key
  elements?

18
Answer

• The three elements are history, physical
  examination, and medical decision making.

19
Anesthesia Codes

• Five-digit codes beginning with 0
• Divided by anatomic site and procedure
• Two modifiers used in anesthesia
• Standard modifier in all sections
• Physical status modifier
• Indicate patients condition at time of
  anesthesia (P1 is normal P5 will not survive
  without procedure)

20
Surgery Codes

• Unstarred codes
• Starred codes
• Integumentary system
• Repairs
• Cast reapplication
• Multiple procedures furnished on the same day

21
Unstarred Codes

• Refer to codes that include a surgical package
• Surgical package local infiltration,
  metacarpal, metatarsal, or digital block or
  topical anesthesia, the operation itself, and
  normal follow-up care
• Cannot bill separately for preoperative and
  postoperative components

22
Unstarred Codes (continued)

• CMS defines surgical package differently for
  Medicare patients
• Additional procedures done to correct or
  alleviate problems are coded separately
• Complications not requiring revisit to operating
  room are included in price of surgery

23
Starred Codes

• Used for surgical service
• Surgical package does not apply
• Code preoperative anesthesia and postoperative
  components separately
• Check with relevant third-party payers for
  specific rules

24
Integumentary System

• Codes for which a measurement is necessary
• Measure size of defect and specimen
• All excisions include simple closure

25
Repairs

• Three types
• Simple
• Intermediate
• Complex
• Measure and recorded in centimeters

26
Cast Reapplication

• Cannot assign same code as cast application
• Reapplication does not include treatment for
  fracture
• Carries lower reimbursement than original
  application

27
Multiple Procedures Furnished on the Same Day

• Code separately unless part of overall service
• Place on claim form in order from major to minor

28
Checkpoint Question 2

• What items are included in a
• surgical package?

29
Answer

• The surgical package consists of local
  infiltration, metacarpal, metatarsal, or digital
  blocks, topical anesthesia, the operation, and
  normal, uncomplicated follow-up care.

30
Radiology Codes

• Four radiology subsections
• Diagnostic radiology/diagnostic imaging
• Diagnostic ultrasound
• Radiation oncology
• Nuclear medicine
• Five-digit codes starting with 7
• Arranged by anatomic site, from top of body to
  bottom
• Descriptors indicate with contrast or without
  contrast

31
Radiology Codes (continued)

• Use two codes if physician performs, supervises,
  and interprets a procedure
• Code procedure
• Code for supervision and interpretation

32
Pathology and Laboratory Codes

• Five-digit numbers beginning with 8
• Divided into sections for panels of tests
• Final part of section includes services and
  procedures by a pathologist
• Submit each tissue specimen under a separate code
  for diagnosis

33
Pathology and Laboratory Codes (continued)

• Subsection on automated multichannel tests
• Verify that tests performed are included in the
  lists under this section before coding

34
Medicine Codes

• Five-digit numbers beginning with 9
• Pay close attention to immunization injections
  section (90701 to 90749)
• Use two codes when immunization injections
  delivered
• One code for service
• One code for injection

35
Medicine Codes (continued)

• Specify what is injected for therapeutic or
  diagnostic injections
• Medicare includes cost of administering
  injections in price of office and outpatient
  visits
• Supplying drug is considered separate service

36
Medicine Codes (continued)

• Also includes
• Cardiac diagnostic testing
• Performing CPR
• Dialysis treatment

37
Checkpoint Question 3

• A patient comes in for a tetanus booster, and the
  physician gives the booster and completes a
  routine physical examination. How many codes do
  you use for this visit?

38
Answer

• There are two codes one for the service, and one
  for the immunization.

39
CPT-4 Modifiers

• Modifiers additional numbers to provide more
  information on a procedure
• List of modifiers found in Appendix A of CPT-4
• Ways to write modifiers
• Five-digit code with hyphen followed by two-digit
  modifier (28702-22)
• Code without a hyphen separating the code and
  modifier (2870222)
• First modifier as -99 if code needs multiple
  modifiers (28702-9922.)

40
Checkpoint Question 4

• Where can a coder find a list of all CPT
  modifiers?

41
Answer

• A list of all modifiers and their meanings is
  found in Appendix A of CPT-4.

42
Healthcare Common Procedure Coding System

• Healthcare Common Procedure Coding System (HCPCS)
  developed by CMS to cover items such as
• Ambulance service
• Wheelchairs
• Injections

43
Healthcare Common Procedure Coding System
(continued)

• The HCPCS uses codes contained in CPT-4 (now
  known as HCPCS Level 1) plus expanded codes
  developed by CMS and fiscal intermediaries to
  classify physician and nonphysician patient care
  services on the national level (now known as
  HCPCS Level 2).

44
Healthcare Common Procedure Coding System
(continued)

• Level 2 HCPCS codes are most commonly referred to
  as the HCPCS codes, and Level 1 HCPCS codes are
  referred to as CPT.

45
Healthcare Common Procedure Coding System
(continued)

• By 1987, all hospitals and ambulatory surgical
  centers were required to use HCPCS for all
  patients receiving government-sponsored benefits
• Twofold purpose
• Blended payment rate to apply to ambulatory
  surgery in hospital outpatient department
• Provide a database for future payment amounts for
  all outpatient services

46
HCPCS Level 1 Codes

• Codes listed in CPT-4
• Used for procedures and services for private and
  government insurance programs

47
HCPCS Level 2 Codes National Codes

• Released annually in National Coding Manual
• Five-digit alphanumeric codes beginning with A
  through V
• Some of the codes include
• Chemotherapeutic drugs
• Dental services
• Injections
• Orthotics
• Vision care

48
HCPCS Level 3 CodesLocal Codes

• Developed to address regional codes
• Produced and available through state Medicare
  carrier
• Begin with letters W to Z

49
Checkpoint Question 5

• Where do you find codes for dental services?

50
Answer

• Dental codes are found in the HCPCS Level 2
  national codes.

51
Reimbursement

• Diagnostic related groups
• Resource-based relative value scale

52
Diagnostic Related Groups

• Diagnostic related groups (DRGs) are categories
  into which inpatients are placed according to the
  similarity of their diagnoses, treatment, and
  length of hospital stay.
• Used to determine reimbursement for inpatient
  services to Medicare patients

53
Diagnostic Related Groups (continued)

• Fee attached to each DRG based on national
  average of all Medicare discharges
• Adjusted for local factors
• Hospital reimbursed fixed amount according to
  patients DRG

54
Diagnostic Related Groups (continued)

• Medical assistants must assign correct ICD-9-CM
  code when scheduling patients for admission
• Outpatient code will influence inpatient DRG
  assignment
• Hospital coder selects DRG according to
• Principal diagnosis
• Surgeries
• Complications and comorbid conditions

55
Resource-Based Relative Value Scale

• Physician reimbursement for Medicare services
  based on fee schedule
• Schedule sets maximum fee for service based on
  resource-based relative value scale (RBRVS)
• The goal of RBRVS is to reduce Medicare Part B
  costs and to establish national standards of
  payment based on CPT-4 codes.

56
Resource-Based Relative Value Scale (continued)

• Fee calculations based on
• Intensity of service
• Time required
• Skills needed
• Overhead expenses
• Malpractice premiums
• Adjusted by geographical practice cost index
  (GPCI)

57
Resource-Based Relative Value Scale

• GPCIs determine the relative value unit (RVU)
• National conversion factor assigned yearly
• Example
• CPT code 99205
• RVU 4.58
• National conversion factor 36.7856
• Medicare allowed charge is 168.48

58
Checkpoint Question 6

• Why are DRGs used?

59
Answer

• DRGs are used to determine the reimbursement for
  Medicare patients inpatient services.

60
Fraud and Coding

• Examples of fraud
• Billing for services not performed
• Using another patients coverage to receive
  reimbursement
• Falsifying records
• Office of Inspector General usually investigates
  reports of possible fraud

61
Fraud and Coding (continued)

• CMS is vigilant with audits of medical offices
• Audits can cover past years
• If fraud uncovered
• Physician must repay an amount owed plus interest
• May be unable to participate in Medicare-funded
  programs

62
Fraud and Coding (continued)

• To avoid costly errors
• Keep accurate and complete documentation
• Always use most recent code books
• Follow coding rules keep updated on changes
• Never code anything about which you are unsure