Lecture Medical assisting: Administrative and clinical procedures with anatomy and physiology (4e) – Chapter 35

Learning Outcomes cont.16.5 Identify the two types of codes in the Health Care Common Procedure Coding System HCPCS.. 16.6 Describe the process used to locate correct procedure codes usi

Medical Coding

Learning Outcomes

16.1 Explain the purpose and format of the

ICD-9-CM volumes that are used by medical offices

16.2 Describe how to analyze diagnoses and

locate correct codes using the ICD-9-CM

16.3 Identify the purpose and format of the CPT

16.4 Name three key factors that determine the

level of Evaluation and Management codes that are selected

Learning Outcomes (cont.)

16.5 Identify the two types of codes in the Health

Care Common Procedure Coding System (HCPCS)

16.6 Describe the process used to locate correct

procedure codes using CPT

16.7 Explain how medical coding affects the

payment process

16.8 Define fraud and provide examples of

fraudulent billing and coding

Introduction

• Medical coding

– Translation of medical terms for diagnoses

and procedures into code numbers from standardized code sets

– Tells payers that the services provided

• Were medically necessary

• Complied with payer’s rules

• Accurate claims bring maximum

appropriate reimbursement for the medical

office

Diagnosis Codes: The ICD-9-CM

Patient

Chief

Complaint

Physician Medical Diagnosis

Insurance Diagnosis Code

The diagnosis codes are found in the International Classification of

Diseases, Ninth Revision, Clinical Modification (ICD-9)

The use of ICD-9 codes in health care is mandated

by HIPAA for reporting:

 Patient’s diseases  Conditions  Signs and symptoms

The ICD-9-CM

• Alphabetic Index (Volume 2)

– Diagnoses appear in alphabetical order

– The index is organized by condition

– Use initially to look up conditions

– Cross-references

• Look up term that follows “see”

The ICD-9-CM (cont.)

• Tabular List (Volume 1)

– Diagnoses appear in numerical order

– Listing is organized according to source or

body system

Code Structure

 Codes are made up of three, four, and five digits and a description

 Three-digit categories are used for diseases, injuries, and

symptoms

 Categories are further divided into four- and five-digit codes

The ICD-9-CM (cont.)

• Supplementary classification of factors influencing health status and contact with health services

• Identify encounters for reasons other than illness or injury

• May be a primary code or additional code

A list of abbreviations, punctuation, symbols, typefaces, and notes

that provide guidelines for using the code set.

to describe the patient’s condition

Conventions

: Used in the Tabular List after an incomplete term

} Brace encloses a series

of terms

Includes § Refines content of preceding entryIndicates that the footnote is applicable to all

subdivisions in that code

Excludes Indicates that the entry is not classified as part of the

preceding code

ICD-9-CM Conventions (cont.)

Conventions

Excludes These notes indicate that an entry is not classified as part

of the preceding code

Use additional

This means that the code is not to be used for the

primary diagnosis

ICD-9-CM Conventions (cont.)

Locate the patient’s diagnosis



Record the code

on the claim form

The ICD-9-CM Codes (cont.)

The ICD-10-CM/ICD-10-PCS

• Revisions to ICD-9-CM

– ICD-10-CM – over 68,000 diagnostic codes

– ICD-10-PCS – 87,000 procedure codes

• Features

– Combination codes

– Codes for laterality

– Expanded codes capture more detail

– Flexibility and expandability

Apply Your Knowledge

A medical assistant has looked up a medical term

in the alphabetic index, and next to the term is the

word “see.” What does this mean?

ANSWER: This means the medical assistant must look

up the term that follows the word “see” because

another category should be used or cross-referenced.

Procedure Codes: The CPT

• Current Procedural Terminology (CPT) book

– The most commonly used system for reporting

procedures and services provided to the patient

• This is the HIPAA-required code set

• Published annually by the American Medical

Association (AMA)

– Updated annually

– Use the appropriate CPT book for the current year

Organization of the CPT Manual

Except for the first section, the CPT book is arranged in

numerical order

Organization of the CPT Manual (cont.)

• Add-on codes

– A plus sign (+) is used to indicate add-on

codes– Always used with primary code

• Modifiers

– One or more two-digit numbers (up to three

per procedure) assigned to five-digit main number

– Indicate that special circumstance applies

Organization of the CPT Manual (cont.)

• Category II, III, and Unlisted procedure

codes

– Category II – tracks health-care performance

measures

– Category III – temporary codes for emerging

technologies, services, and procedures– Unlisted codes – used when no other code is

available

Evaluation and Management (E/M) Codes

• Used by all physicians in any medical specialty

• Key factors that help determine level of service

The extent of the patient history taken The extent of the examination conducted The complexity of the medical decision made

New Patient versus Established Patient

 New patients – not seen by physician within the past 3 years

 Established patients – seen within a 3-year period

Surgical Procedure Codes

• The surgical package

– All procedures normally a part of an operation

• Anesthesia

• Surgery

• Routine follow-up care

• Global period

– The time period covered for follow-up care

– If past global period, additional services are

reported separately

Laboratory Procedures

Immunizations

• Injections require two codes

– One for the procedure (injection)

– One for the medication (vaccine or toxoid)

• Panels – organ or disease-oriented

– Pathology and Laboratory sections

of the CPT – If separate codes are used, they will

be rebundled and payment delayed

Apply Your Knowledge

1 Which section of the CPT is not arranged in

numerical order and why?

ANSWER: The first section, Evaluation and

Management, is not in numerical order because the

items in this section are used most often and by all

physicians in any medical specialty.

Excellent!

2 The insurance representative has questioned the

codes listed on three patient forms that were

submitted last year When re-checking these forms

the office medical assistant should:

a Use the current book to validate accuracy of the codes

b Use last year’s book to validate accuracy of the codes

c Use next year’s book to validate accuracy of the codes

Apply Your Knowledge

Excellent!

ANSWER:

Using the CPT

• Become familiar with guidelines and notes

for each section

• Find the procedures and services provided

Locate services documented

Using the CPT (cont.)

Apply Your Knowledge

What are HCPCS Level II codes and who issues

them?

ANSWER: HCPCS Level II codes are national codes

used for supplies, DME, and services not included in

the CPT They are issued by Centers for Medicare and

Medicaid Services (CMS).

Prevent errors in coding and incorrect billing by careful attention to details

Insurance Fraud

• Investigators look for patterns such as

– Reporting services that were not performed

– Reporting services at a higher level

– Performing and billing for procedures not

related to the patient’s condition and therefore not medically necessary

– Billing separately for services that are bundled

in a single procedure code

Compliance Plans

• Medical offices establish a process for

finding, correcting, and preventing illegal

medical practices

• Goals of compliance plan

– Prevent fraud and abuse

– Ensure compliance with applicable laws

– Help defend physicians if investigation occurs

Compliance Plans (cont.)

• Plan demonstrates to payers honest, ongoing

attempts to correct any weak areas of

compliance

• Plan is developed by a compliance officer and

committee who also:

– Audit and monitor compliance

– Develop written policies and procedures that are

consistent with regulations and laws – Provide ongoing communication and training to staff

– Respond to and correct errors

Apply Your Knowledge

What are the goals of a compliance plan and what

does having a plan indicate?

ANSWER: The goals of a compliance plan are to prevent

fraud and abuse, ensure compliance with applicable

laws, and to help defend physicians if an investigation

occurs Having a plan indicates that the medical office

is making honest, ongoing attempts to find and fix weak

areas of compliance

Correct!

In Summary

16.1 The purpose of the ICD-9 manual is to find diagnosis

codes for patients’ medical conditions It is formatted with the Alphabetic Index and the Tabular List

16.2 To analyze diagnoses, think about the condition and

not the body part; then think about the location This will assist you in finding the correct codes much more easily.

16.3 The CPT-4 is used for locating medical procedure

codes It is organized from Evaluation/Management (E/M) to Medicine

In Summary (cont.)

16.4 The three levels that determine E/M service are

extent of patient history taken, extent of exam conducted, and complexity of the medical decision making.

16.5 The two types of HCPCS codes are Level I codes

(also called CPT codes) and Level II codes, issued by CMS.

16.6 In locating a procedure code, you first become

familiar with the format and guidelines For further information on completing this process, see

Procedure 16.3.

In Summary (cont.)

16.7 Diagnosis and procedure coding must be

directly linked when reporting for reimbursement because payers analyze this connection to determine the medical

necessity for the charge

16.8 Insurance fraud is an act of deception used to

take advantage of another entity An example

of billing and coding fraud is when a physician reports services that were not performed

Things gained through unjust fraud are never secure

~ Sophocles

End of Chapter 16