For the last several years, orthopaedic practices have seen professional reimbursements decline while practice expenses increase. According to AAOS census data, private pay insurance in orthopaedic practices declined from 38.7 percent of total revenues to 17.1 percent of total revenues between 1988 and 2004. For the same time period, payments from managed care programs increased from 11.6 percent to 33.8 percent of total revenues and Medicare/Medicaid payments increased from 26.4 percent to 31.2 percent of total revenues. These trends are likely to continue.
In such an environment, orthopaedic surgeons can no longer be complacent about our billings. Increasing overhead expenses and declining reimbursements make it imperative that we code correctly and receive the appropriate reimbursement for the work we do. The fate of our practices depends on our being proactive in coding and billing correctly. But it’s not easy, and sometimes it seems that outside forces are conspiring to make it even more difficult.
The pressure to code correctly comes from multiple sources, including payors, hospitals, practice administrators, and even other physicians within the group. Nor does it make any difference what type of practice you have—whether you are a solo practitioner or part of a multi-specialty group or an academic institution.
But when payors continually change reimbursement amounts, and the coding structure continues to evolve and become more complex, correct coding gets complicated. Fortunately, technology enables us to be better informed about our coding through electronic billing and instant feedback of acceptance or denial. This enables us to adapt quickly to changes made by payors, and to ensure appropriate coding and documentation to support the code.
In my practice, an electronic coding system empowers physicians and ensures correct coding with the supporting documentation. I use a software-based medical record that applies a coding algorithm before I even begin my dictation.
Before I began using a coding electronic medical record (EMR), I let my office coders submit charges. But the new coding EMR placed the responsibility squarely on my shoulders. It also helped ensure proper coding even before I began dictating the operative or clinic record. Finally, knowing the appropriate codes enabled me to document my services properly, resulting in improved reimbursement.
In the first quarter after I implemented this system, my total surgical reimbursement increased by 75 percent over the prior year. Additionally, the average number of reimbursed CPT codes per case increased by more than 46 percent—from 1.6 to 2.34.
According to Blair C. Filler, MD, a member of the AAOS Coding, Coverage, and Reimbursement Committee, private committee surveys consistently show that physicians who code their own cases increase reimbursement by at least 25 percent.
Medical coding and reimbursement have become increasingly complex, with payments usually determined by the CMS resource-based relative value scale. This system assigns a relative value unit (RVU) to service(s) performed and uses a conversion factor (or “multiplier”) to arrive at reimbursement. The RVUs assigned for a given procedure are based on three components—physician work, practice expense, and professional liability insurance—with adjustments for regional variations.
But the implementation of Medicare’s Correct Coding Initiative (CCI) in 1996 introduced additional complexity to the system. The CCI is a collection of rules or “edits,” which specify the conditions under which multiple CPT codes may be used. Code pairs are assigned either a 1 indicator or a 0 indicator. A 1 indicator means that the two CPT codes may be used together if certain conditions are met; a 0 indicator means that the two CPT codes will not be reimbursed together under any circumstance. If a physician bills for both CPT codes despite the 0 indicator, the payor could disallow the code with the higher reimbursement.
CCI rules are updated quarterly so the code set that worked for a particular case one quarter may not work the next quarter. For a classic example of the confusion that could result, we need only examine the CPT code for arthroscopic knee chondroplasty (CPT 29877).
Before 2002, this code could be used with a meniscectomy code if the arthroscopic chondroplasty was performed in a different compartment than the meniscectomy (a 1 indicator conflict with appropriate application of a 59 modifier). In January 2002, a 0 indicator was applied, so that the two codes could not be used together under any circumstances. But the following quarter (April 2002), Medicare reversed its decision and made the change retroactive to the beginning of the year. Practices that had submitted bills and been denied payment could now resubmit the bills. In October 2002, the edit was changed again to a 0 indicator.
Finally, on Dec. 31, 2002, a new code (G0289) was introduced for use when the two procedures were performed together. On behalf of its members, the AAOS worked with the medical directors at CMS to help them better understand the knee joint’s anatomy so that these two concurrent services would be reimbursed appropriately when linked to separately identifiable diagnoses in different compartments of the knee.
Also note that the AAOS’ CodeX software program contains all CCI edits, including the history of the edit (when it was added/active or deleted/inactive). The program also enables you to capture these quarterly updates with the click of a button.
Using an EMR coding system
Although most coding and documentation systems are designed for business office staff, the EMR coding system that I have is designed to be used by the surgeon before case dictation. Proper use of this system requires a fundamental change in case documentation workflow.
Traditionally, surgeons have first performed the procedure and then dictated their operative notes. Working from these notes, the surgeon or office staff would later code the case. EMR coding systems re-engineer this workflow so that the surgeon first performs the procedure, codes the case, and analyzes the code set. Only then is the optimized code set used as an outline for accurate dictation.
By making the surgeon aware of CCI issues prior to dictation, the system I use enables the surgeon to dictate key portions of the case to justify use of the selected code set and modifiers. The system guides the surgeon through the process of adding modifiers or changing CPT codes and uses language that physicians can understand. The code-first, dictate-second methodology is designed to optimize reimbursement on each case and decrease denied CPT codes by linking coding with documentation.
Several EMR coding and billing software programs are available for use. Each has its own advantages and disadvantages. I would advocate choosing one that meets the demands of your particular practice and is easy for you and your support staff to use. By using these EMRs as tools to help ensure proper coding and correct reimbursement for your work, you can continue to care for your patients.
Orthopaedic practices will have to pay greater attention to correct coding and reimbursement or risk financial insolvency. A change in surgical workflow that applies correct coding before you dictate the supportive notes may be one solution to the dilemma.
J. Brian Gill, MD, MBA, is a resident instructor in the department of orthopaedic surgery at the Texas Tech University Health Science Center. He can be reached at firstname.lastname@example.org.