Outpatient Billing/Coding: A Focus on Missed Reimbursement & Quality of Reported Data

Outpatient Billing/Coding: A Focus on Missed Reimbursement & Quality of Reported Data 438 e wilson bridge road, suite 200 worthington, oh 43085-2382 888-779-5663 www.cleverleyassociates.com 1

All US Average Error Rate - Medicare Outpatient Claims for Specific Custom Edits 21.0% 20.5% 20.0% 19.5% 19.0% 18.5% 20.9% 20.1% 19.5% 2004 2005 2006 All US - Medicare OP Claims 2

All US Medicare Total Potential Missed Reimbursement for Specific Custom Edits $325,000,000 $320,000,000 $315,000,000 $310,000,000 $305,000,000 $300,000,000 2004 2005 2006 All US - Medicare OP Claims 3

Overview Introduction Coding & Billing Data Quality Why is this important? What are the possible causes? Identifying Problematic Areas Examples of Potential Missed Reimbursement Drug Administration Specimen Removal Venipuncture Wound/ Fracture Repair Pharmacy charge Other Areas to Monitor Next Steps How can we fix it/prevent future occurrences? 4

Examining Outpatient Billing/Coding Data 5

Importance Quality of Reported Data Time Involved Use of Internal Resources Reimbursement 6

Health Care Revenue Cycle Registration/ Pre-Cert Provide Services Documentation Charge Entry HIM/ Medical Records Chargemaster Billing System Claims Prepared Claims Edited Claims Submission Payment Received 7

Root Causes of Errors Documentation Communication Disconnect between HIM and CDM Who is responsible for entering charges? Who is responsible for coding the account? Frequency of Regulation changes Complexity of rules 8

Identifying Potential Problematic Areas 9

Drug Administration A pharmaceutical item requiring injection or infusion is present without the administration procedure. Results include chemotherapy and nonchemotherapy administration. This indicator excludes surgery, cardiology, and gastrointestinal service claims. 40% 30% 20% 10% 0% Percent of Medicare OP Claims Missing Drug Administration 39% 29% 27% 33% 24%24% 32% 2004 2005 2006 24% 23% C+A Sample Hospital Webinar Group All US 10

Drug Administration Coding Patterns Non-Chemo Drug Administration Top 10 (All US) Most Frequent Codes Triggering Error HCPCS Code Description Percent of Total Occurrences J0152 Adenosine injection, dx, 30 mg 9.9% J2912 Sodium chloride injection 7.8% J1245 Dipyridamole injection 6.8% J2405 Ondansetron hcl inj 1 mg 4.1% J1885 Ketorolac tromethamine inj 3.1% J2270 Morphine sulfate injection 3.1% J0150 Injection adenosine,rx, 6 mg 3.1% J2550 Promethazine hcl injection 3.0% J1642 Inj heparin sodium per 10 u 2.7% J3010 Fentanyl citrate injection,.1 2.4% CPT 2005 American Medical Association. All Rights Reserved. 11

Chemotherapy Drug Administration Top 10 (All US) Most Frequent Codes Triggering Error HCPCS Code Description Percent of Total Occurrences J9217 Leuprolide acetate suspnsion 18.2% J9250 Methotrexate sodium inj 5 mg 9.8% J9202 Goserelin acetate implant 9.1% J9395 Injection, Fulvestrant 7.3% J9310 Rituximab, 100 mg 6.3% J9214 Interferon alfa-2b inj 4.7% J9035 Bevacizumab injection 4.3% J9045 Carboplatin injection 50 mg 2.9% J9280 Mitomycin 5 mg 2.9% J9265 Paclitaxel 30 mg 2.7% CPT 2005 American Medical Association. All Rights Reserved. Drug Administration Coding Patterns 12

Drug Administration Claim Example Claim Example #1 for Indicator 01: Drug Administration Claim ID DOS Rev Code HCPCS Definition APC Status Units Charges Pre-APC Payment Payment 100000001 10/1/2006 250 NULL No CPT Code 0000 1 16.20 $4.71 $0.00 100000001 10/1/2006 250 NULL No CPT Code 0000 1 16.20 $4.71 $0.00 100000001 10/1/2006 258 NULL No CPT Code 0000 2 77.10 $22.40 $0.00 100000001 10/1/2006 258 NULL No CPT Code 0000 1 39.95 $11.61 $0.00 100000001 10/1/2006 305 85025 Automated hemogram 0000 A 1 71.00 $10.86 $10.83 100000001 10/1/2006 636 J1100 Dexamethasone sodium phos 0000 N 20 17.05 $4.95 $0.00 100000001 10/1/2006 636 J1100 Dexamethasone sodium phos 0000 N 20 17.05 $4.95 $0.00 100000001 10/1/2006 636 J1200 Diphenhydramine hcl injectio 0000 N 1 16.80 $4.81 $0.00 100000001 10/1/2006 636 J1200 Diphenhydramine hcl injectio 0000 N 1 16.80 $4.81 $0.00 100000001 10/1/2006 636 J1260 Dolasetron mesylate, 10 mg 0750 K 10 109.75 $31.89 $68.90 100000001 10/1/2006 636 J1260 Dolasetron mesylate, 10 mg 0750 K 10 109.75 $31.89 $68.90 100000001 10/1/2006 636 J9035 Bevacizumab injection 9214 G 120 16,054.05 $4,664.49 $7,196.40 100000001 10/1/2006 636 J9265 Paclitaxel 30 mg 0863 K 7 2,925.35 $849.96 $100.45 100000001 10/1/2006 636 J9265 Paclitaxel 30 mg 0863 K 7 2,925.35 $849.96 $100.45 Totals $22,412.40 $6,502.00 $7,545.93 CPT 2005 American Medical Association. All Rights Reserved. 13

Drug Administration Claim Example Claim Example #2 for Indicator 01: Drug Administration Claim ID DOS Rev Code HCPCS Definition APC Status Units Charges Pre-APC Payment Payment 100000003 10/19/2006 258 NULL No CPT Code 0000 1 $36.45 $10.59 $0.00 100000003 10/19/2006 264 NULL No CPT Code 0000 1 $29.50 $8.57 $0.00 100000003 10/19/2006 301 80051 Electrolyte panel 0000 A 1 $68.25 $6.33 $6.33 100000003 10/19/2006 301 82565 Assay of creatinine 0000 A 1 $20.25 $7.16 $7.16 100000003 10/19/2006 301 82947 Assay of glucose, quant 0000 A 1 $26.00 $5.48 $5.48 100000003 10/19/2006 301 84520 Assay of urea nitrogen 0000 A 1 $20.25 $5.51 $5.51 100000003 10/19/2006 305 85025 Automated hemogram 0000 A 1 $71.00 $10.86 $10.86 100000003 10/19/2006 306 87040 Blood culture for bacteria 0000 A 2 $247.50 $28.84 $28.84 100000003 10/19/2006 324 71020 Chest x-ray 0260 X 1 $258.50 $33.16 $43.42 100000003 10/19/2006 410 94640 Airway inhalation treatment 0077 S 2 $72.00 $20.67 $40.80 100000003 10/19/2006 450 99284 Emergency dept visit 0612 V 1 $942.25 $193.89 $224.78 100000003 10/19/2006 636 J0456 Azithromycin 0000 N 1 $74.70 $21.70 $0.00 100000003 10/19/2006 636 J0696 Ceftriaxone sodium injection 0000 N 4 $91.05 $26.45 $0.00 100000003 10/19/2006 637 NULL No CPT Code 0000 3 $14.65 $4.26 $0.00 Totals $1,972.35 $383.47 $373.18 CPT 2005 American Medical Association. All Rights Reserved. 14

Specimen Removal A pathology exam is present without a biopsy or specimen removal procedure. This indicator excludes: Bill Type = 14X Claims with laboratory only charges 7% 6% 5% 4% 3% 2% 1% 0% Percent of Medicare OP Claims Missing Specimen Removal Procedure 5% 2% 2% 7% 2% 2% 3% 2% 2% 2004 2005 2006 C+A Sample Hospital Webinar Group All US 15

Specimen Removal Potential Missed Reimbursement All US over 3 year period > $61.7 million Reimbursement projection based on most commonly reported surgical APC APC 0143 APC 0143 National Payment 2004 = $452.62 2005 = $490.01 2006 = $509.34 $22,000,000 $21,500,000 $21,000,000 $20,500,000 $20,000,000 $19,500,000 $19,000,000 Medicare OP Claims - Specimen Removal Procedure $21,538,352 $19,867,995 $20,322,479 2004 2005 2006 All US 16

Specimen Removal Claim Example Claim Example #1 for Indicator 02: Specimen Removal Claim ID DOS Rev Code HCPCS Definition Pre-APC APC Status Units Charges Payment Payment 100000005 8/16/2006 300 36415 Drawing blood 0000 A 1 $12.75 $3.00 $3.00 100000005 8/16/2006 301 80053 Comprehen metabolic panel 0000 A 1 $160.25 $14.77 $14.77 100000005 8/16/2006 301 83615 Lactate (LD) (LDH) enzyme 0000 A 1 $26.00 $8.44 $8.44 100000005 8/16/2006 305 85025 Automated hemogram 0000 A 1 $71.00 $10.86 $10.86 100000005 8/16/2006 310 88305 Tissue exam by pathologist 0343 X 1 $93.25 $17.34 $27.10 100000005 8/16/2006 403 76083 Computer mammogram add-on 0000 A 1 $18.75 $17.73 $17.73 100000005 8/16/2006 403 76092 Mammogram, screening 0000 A 1 $71.00 $78.13 $78.13 Totals $453.00 $150.27 $160.03 CPT 2005 American Medical Association. All Rights Reserved. 17

Specimen Removal Claim Example Claim Example #2 for Indicator 02: Specimen Removal Claim ID DOS Rev Code HCPCS Definition Pre-APC APC Status Units Charges Payment Payment 100000019 10/5/2006 255 NULL No CPT Code 0000 1 $25.60 $7.88 $0.00 100000019 10/5/2006 305 85027 Automated hemogram 0000 A 1 $30.25 9.04 9.04 100000019 10/5/2006 310 88304 Tissue exam by pathologist 0343 X 1 $76.25 14.176148 27.1 100000019 10/5/2006 320 74000 X-ray exam of abdomen 0260 X 1 $205.50 $32.11 43.42 100000019 10/5/2006 320 74300 X-ray bile ducts/pancreas 0263 X 1 $516.75 $80.75 101.04 100000019 10/5/2006 636 J1644 Inj heparin sodium per 1000u 0000 N 2 $33.20 $10.22 $0.00 100000019 10/5/2006 636 J1956 Levofloxacin injection 0000 N 1 $73.90 $22.76 $0.00 100000019 10/5/2006 636 J2250 Inj midazolam hydrochloride 0000 N 1 $17.15 $5.28 $0.00 100000019 10/5/2006 636 J2405 Ondansetron hcl inj 1 mg 0768 K 1 $56.65 $17.45 $0.00 100000019 10/5/2006 636 J2765 Metoclopramide hcl injection 0000 N 1 $16.20 $4.99 $0.00 100000019 10/5/2006 636 J3010 Fentanyl citrate injeciton,.1 0000 N 1 $16.70 $5.14 $0.00 100000019 10/5/2006 636 J3490 Drugs unclassified injection 0000 N 8 $313.25 $96.47 $0.00 100000019 10/5/2006 636 J7120 Ringers lactate infusion 0000 N 1 $37.05 $11.41 $0.00 100000019 10/5/2006 732 NULL No CPT Code 0000 1 $250.50 $66.90 $0.00 100000019 10/5/2006 732 NULL No CPT Code 0000 1 $250.50 $66.90 $0.00 100000019 10/5/2006 732 NULL No CPT Code 0000 1 $250.50 $66.90 $0.00 Totals $2,169.95 $518.38 $180.60 CPT 2005 American Medical Association. All Rights Reserved. 18

Venipuncture A laboratory test requiring a venous blood draw is present without venipuncture. This indicator excludes surgery, cardiology, and gastrointestinal service claims.. 50% 40% 30% 20% 10% 0% Percent of Medicare OP Claims Missing Venipuncture Procedure 42% 41% 40% 45% 43%39% 38% 38% 35% 2004 2005 2006 C+A Sample Hospital Webinar Group All US 19

Top 10 (All US) Most Frequent Codes Triggering Error HCPCS Code Description Percent of Total Occurrences 85025 Automated hemogram 13.9% 85610 Prothrombin time 8.4% 80053 Comprehen metabolic panel 7.9% 80048 Basic metabolic panel 6.8% 84484 Assay of troponin, quant 5.2% 82550 Assay of ck (cpk) 4.0% 85730 Thromboplastin time, partial 4.0% 82553 Creatine, MB fraction 3.3% 85027 Automated hemogram 2.6% 82565 Assay of creatinine 2.3% Venipuncture Coding Patterns 20

Venipuncture Claim Example Claim Example #1 for Indicator 04: Venipuncture Claim ID DOS Rev Code HCPCS Definition APC Status Units Charges Pre-APC Payment Payment 100000008 11/10/2006 250 NULL No CPT Code 0000 1 $16.00 $4.93 $0.00 100000008 11/10/2006 258 NULL No CPT Code 0000 2 $72.90 $22.45 $0.00 100000008 11/10/2006 264 NULL No CPT Code 0000 1 $32.35 $8.34 $0.00 100000008 11/10/2006 301 80053 Comprehen metabolic panel 0000 A 1 $160.25 $14.77 $14.77 100000008 11/10/2006 305 85025 Automated hemogram 0000 A 1 $71.00 $10.86 $10.86 100000008 11/10/2006 636 J1200 Diphenhydramine hcl injectio 0000 N 1 $16.80 $5.17 $0.00 100000008 11/10/2006 636 J1642 Inj heparin sodium per 10 u 0000 N 30 $16.20 $4.99 $0.00 100000008 11/10/2006 636 J9355 Trastuzumab, 10 mg 1613 K 88 $11,640.40 $3,584.96 $4,942.96 Totals $12,025.90 $3,656.48 $4,968.59 CPT 2005 American Medical Association. All Rights Reserved. 21

Venipuncture Claim Example Claim Example #2 for Indicator 04: Venipuncture Claim ID DOS Rev Code HCPCS Definition APC Status Units Charges Pre-APC Payment Payment 100000009 11/23/2006 300 84512 Assay of troponin, qual 0000 A 1 $75.00 $10.11 $10.11 100000009 11/23/2006 301 80053 Comprehen metabolic panel 0000 A 1 $160.25 $14.77 $14.77 100000009 11/23/2006 301 82550 Assay of ck (cpk) 0000 A 1 $26.25 $9.10 $9.10 100000009 11/23/2006 305 85025 Automated hemogram 0000 A 1 $71.00 $10.86 $10.86 100000009 11/23/2006 324 71010 Chest x-ray 0260 X 1 $205.50 $32.11 $43.42 100000009 11/23/2006 450 99284 Emergency dept visit 0612 V 1 $942.25 $271.46 $224.78 100000009 11/23/2006 637 NULL No CPT Code 0000 1 $0.50 $0.15 $0.00 100000009 11/23/2006 730 93005 Electrocardiogram, tracing 0099 S 1 $138.25 $36.92 $22.43 100000009 11/23/2006 732 NULL No CPT Code 0000 1 $250.50 $66.90 $0.00 Totals $1,869.50 $452.38 $335.47 CPT 2005 American Medical Association. All Rights Reserved. 22

Wound/Fracture Repair A laceration- or woundrelated diagnosis is present on an emergency room claim without a wound repair procedure. A fracture diagnosis code is present on an emergency room claim without a fracture treatment procedure. 70% 60% 50% 40% 30% 20% 10% 0% Percent of Medicare OP Claims Missing Wound/ Fracture Repair Procedure 61% 59% 49% 57%51% 50% 50% 44% 39% 2004 2005 2006 C+A Sample Hospital Webinar Group All US 23

Examples of Diagnosis codes Triggering Error Fracture Diagnosis Code Description 812.00 FX UP END HUMERUS NOS-CL 813.41 COLLES' FRACTURE-CLOSED 813.42 FX DISTAL RADIUS NEC-CL 820.8 FX NECK OF FEMUR NOS-CL 824.8 FX ANKLE NOS-CLOSED Wound Care Diagnosis Code Description 873.0 OPEN WOUND OF SCALP 881.00 OPEN WOUND OF FOREARM 882.0 OPEN WOUND OF HAND 883.0 OPEN WOUND OF FINGER 891.0 OPEN WND KNEE/LEG/ANKLE Wound/Fracture Repair Coding Patterns 24

Fracture/Dislocation Repair Claim Example Claim Example #1 for Indicator 25: Fracture/Dislocation Repair Diagnosis Code: 812.01 - Fx Surg Nck Humerous Closed Claim ID DOS Rev Code HCPCS Definition APC Status Units Charges Pre-APC Payment Payment 100000016 10/5/2006 301 80051 Electrolyte panel 0000 A 1 $68.25 $6.33 $6.33 100000016 10/5/2006 301 82565 Assay of creatinine 0000 A 1 $20.25 $7.16 $7.16 100000016 10/5/2006 301 82947 Assay of glucose, quant 0000 A 1 $26.00 $5.48 $5.48 100000016 10/5/2006 301 84520 Assay of urea nitrogen 0000 A 1 $20.25 $5.51 $5.51 100000016 10/5/2006 305 85025 Automated hemogram 0000 A 1 $71.00 $10.86 $10.86 100000016 10/5/2006 324 71010 Chest x-ray 0260 X 1 $205.50 $32.11 $43.42 100000016 10/5/2006 352 73200 CAT scan of arm 0332 S 2 $3,507.50 $548.12 $376.20 100000016 10/5/2006 450 99285 Emergency dept visit 0612 V 1 $1,267.00 $365.02 $224.78 100000016 10/5/2006 730 93005 Electrocardiogram, tracing 0099 S 1 $138.25 $36.92 $22.43 100000016 10/5/2006 732 NULL No CPT Code 0000 1 $250.50 $66.90 $0.00 Totals $5,574.50 $1,084.40 $702.17 CPT 2005 American Medical Association. All Rights Reserved. 25

Fracture/Dislocation Repair Claim Example Claim Example #2 for Indicator 25: Fracture/Dislocation Repair Diagnosis Code: 812.09 - Fx Upper Humerous NEC Closed Claim ID DOS Rev Code HCPCS Definition APC Status Units Charges Pre-APC Payment Payment 100000017 11/7/2006 250 NULL No CPT Code 0000 1 $16.20 4.99 $0.00 100000017 11/7/2006 272 NULL No CPT Code 0000 1 $203.00 $52.36 $0.00 100000017 11/7/2006 310 88305 Tissue exam by pathologist 0343 X 1 $100.75 18.73 $27.10 100000017 11/7/2006 320 73030 X-ray exam of shoulder 0260 X 1 $258.50 40.40 $43.42 100000017 11/7/2006 320 73060 X-ray exam of humerus 0260 X 1 $258.50 66.67 $43.42 100000017 11/7/2006 456 99283 Emergency dept visit 0611 V 1 $581.50 167.53 $129.18 100000017 11/7/2006 636 J2250 Inj midazolam hydrochloride 0000 N 5 $18.80 5.79 $0.00 100000017 11/7/2006 637 NULL No CPT Code 0000 2 $13.70 4.22 $0.00 100000017 11/7/2006 750 45380 Colonoscopy and biopsy 0143 T 1 $1,234.00 229.42 $509.34 Totals $2,684.95 590.10 $752.46 CPT 2005 American Medical Association. All Rights Reserved. 26

Wound Repair Claim Example Claim Example #1 for Indicator 26: Wound Repair Diagnosis Code: 884.0 - Open Wound Arm Mult/NOS Claim ID DOS Rev Code HCPCS Definition Pre-APC APC Status Units Charges Payment Payment 100000017 10/13/2006 250 NULL No CPT Code 0000 1 $ 17.35 $5.34 $0.00 100000017 10/13/2006 320 73090 X-ray exam of forearm 0260 X 1 $ 258.50 $40.40 $43.42 100000017 10/13/2006 456 99283 Emergency dept visit 0611 V 1 $ 581.50 $167.53 $129.18 100000017 10/13/2006 636 J2270 Morphine sulfate injection 0000 N 2 $ 38.80 $11.95 $0.00 100000017 10/13/2006 636 90718 Td vaccine, im 0000 N 1 $ 59.55 $18.34 $0.00 Totals $ 955.70 $243.56 $172.60 CPT 2005 American Medical Association. All Rights Reserved. 27

Wound Repair Claim Example Claim Example #2 for Indicator 26: Wound Repair Diagnosis Code: 881.01- Open Wound of Elbow Claim ID DOS Rev Code HCPCS Definition APC Status Units Charges Pre-APC Payment Payment 100000018 11/2/2006 305 85025 Automated hemogram 0000 A 1 $71.00 $10.86 $10.86 100000018 11/2/2006 305 85610 Prothrombin time 0000 A 1 $17.75 $5.49 $5.49 100000018 11/2/2006 320 71100 X-ray exam of ribs 0260 X 1 $258.50 $40.40 $43.42 100000018 11/2/2006 320 73080 X-ray exam of elbow 0260 X 1 $314.00 $49.07 $43.42 100000018 11/2/2006 351 70450 CAT scan of head or brain 0332 S 1 $1,753.75 $274.06 $188.10 100000018 11/2/2006 352 72125 CAT scan of neck spine 0332 S 1 $1,753.75 $274.06 $188.10 100000018 11/2/2006 450 99285 Emergency dept visit 0612 V 1 $1,267.00 $365.02 $224.78 100000018 11/2/2006 636 90718 Td vaccine, im 0000 N 1 $59.55 $18.34 $0.00 100000018 11/2/2006 730 93005 Electrocardiogram, tracing 0099 S 1 $138.25 $36.92 $22.43 100000018 11/2/2006 732 NULL No CPT Code 0000 1 $250.50 $66.90 $0.00 100000018 11/2/2006 771 90471 Immunization admin 0353 X 1 $26.00 $24.38 $23.31 Totals $5,910.05 $1,165.48 $749.91 CPT 2005 American Medical Association. All Rights Reserved. 28

Pharmacy Charge A chemotherapy or nonchemotherapy drug administration procedure is present without pharmacy charges in revenue code 25X or 63X. 10% 8% 6% 4% 2% 0% Percent of Medicare OP Claims Missing Pharmacy Charge 10% 8% 7% 9% 7% 6% 4% 8% 2004 2005 2006 6% C+A Sample Hospital Webinar Group All US 29

Pharmacy Charge Claim Example Claim Example #1 for Indicator 08: Pharmacy Claim ID DOS Rev Code HCPCS Definition APC Status Units Charges Pre-APC Payment Payment 100000011 10/28/2006 260 C8950 IV inf, tx/dx, up to 1 hr 0120 S 1 $268.75 $69.58 $120.77 100000011 10/28/2006 300 81002 Urinalysis nonauto w/o scope A 1 $23.25 $3.30 $3.30 100000011 10/28/2006 301 80048 Basic metabolic panel A 1 $102.00 $10.25 $10.25 100000011 10/28/2006 352 72192 CAT scan of pelvis 0332 S 1 $1,753.75 $274.06 $188.10 100000011 10/28/2006 352 74150 CAT scan of abdomen 0332 S 1 $1,753.75 $274.06 $188.10 100000011 10/28/2006 450 C8952 Tx, prophy, dx IV push 0359 X 1 $153.75 $44.29 $47.82 100000011 10/28/2006 450 99284 Emergency dept visit 0612 V 1 $942.25 $271.46 $224.78 100000012 11/12/2006 260 C8950 IV inf, tx/dx, up to 1 hr 0120 S 1 $268.75 $69.32 $120.77 100000012 11/12/2006 260 C8951 IV inf, tx/dx, each addl N 3 $118.50 $30.56 $0.00 100000012 11/12/2006 300 80100 Drug screen A 1 $210.25 $12.08 $12.08 100000012 11/12/2006 300 84484 Assay of troponin, quant A 1 $75.00 $13.75 $13.75 100000012 11/12/2006 301 80053 Comprehen metabolic panel A 1 $160.25 $14.77 $14.77 100000012 11/12/2006 301 80196 Assay of salicylate A 1 $99.75 $9.92 $9.92 100000012 11/12/2006 301 82003 Assay of acetaminophen A 1 $140.75 $28.28 $28.28 100000012 11/12/2006 305 85025 Automated hemogram A 1 $71.00 $10.86 $10.86 100000012 11/12/2006 307 81001 Urinalysis, auto w/scope A 1 $37.75 $4.43 $4.43 100000012 11/12/2006 324 71020 Chest x-ray 0260 X 1 $258.50 $40.40 $43.42 100000012 11/12/2006 730 93005 Electrocardiogram, tracing 0099 S 2 $276.50 $73.84 $44.86 100000012 11/12/2006 732 NULL No CPT Code 1 $250.50 $66.90 $0.00 Totals $6,965.00 $1,322.10 $1,086.26 CPT 2005 American Medical Association. All Rights Reserved. 30

Pharmacy Charge Claim Example Claim Example #2 for Indicator 08: Pharmacy Claim ID DOS Rev Code HCPCS Definition APC Status Units Charges Pre-APC Payment Payment 100000013 11/18/2006 302 87880 Strep a assay w/optic 0000 A 1 $93.25 $16.76 $16.76 100000013 11/18/2006 306 87081 Bacteria culture screen 0000 A 1 $74.25 $9.26 $9.26 100000013 11/18/2006 306 87147 Culture typing, serologic 0000 A 1 $50.25 $6.37 $6.37 100000013 11/18/2006 450 99283 Emergency dept visit 0611 V 1 $579.50 $166.95 $129.18 100000013 11/18/2006 940 C8952 Tx, prophy, dx IV push 0359 X 1 $153.75 $144.18 $47.82 100000013 11/18/2006 940 90772 Ther/proph/diag inj, sc/i 0353 X 2 $207.50 $194.58 $46.62 Totals $1,158.50 $538.10 $256.01 CPT 2005 American Medical Association. All Rights Reserved. 31

Other Areas to Monitor 32

Other Areas to Monitor E/M Levels Emergency Department Clinic CMS states in the 2008 OPPS Final Rule In the absence of national guidelines, we will continue to regularly reevaluate patterns of hospital outpatient visit reporting at varying levels of disaggregation below the national level to ensure that hospitals continue to bill appropriately and differentially for these services. 33

Emergency Department E/M Levels ED E/M Level Distribution: 2006 Medicare Public OP Claims Data 60% 50% 40% 30% 20% 10% 0% 99281 99282 99283 99284 99285 C+A Hospital Webinar Group All US CPT 2005 American Medical Association. All Rights Reserved. 34

Clinic E/M Levels Clinic E/M Level Distribution: 2006 Medicare Public OP Claims Data New Patient Levels Established Patient Levels 60% 70% 50% 60% 40% 30% 20% 10% 50% 40% 30% 20% 10% 0% 99201 99202 99203 99204 99205 0% 99211 99212 99213 99214 99215 C+A Sample Hospital Webinar Group All US C+A Sample Hospital Webinar Group All US 35

Other Areas to Monitor Profile Units of service Flag Unlikely Services or Procedures with Units > 1 Services or Procedures Time Based Therapies Auditory Function Pharmaceuticals Dosage Reporting 36

Drug Units J9305: Injection, Pemetrexed, 10 mg Occurrences 100 80 60 40 20 0 92 22 10 2 7 $20.39 $67.98 $101.97 $203.94 $5,099 Total Line Charge per claim = $10,197 2006 National Medicare Payment = $40.67 per unit Charge per Unit 500 units billed @ $20.39/unit on 22 occurrences = Potential Overpayment of $402,633 150 units billed @ $67.98/unit on 10 occurrences = Potential Overpayment of $40,670 100 units billed @ $101.97/unit on 2 occurrences = Potential Overpayment of $4,067 50 units billed @ $203.94/unit on 92 occurrences = typical dosage 500 mg 2 units billed @ $8,781.06/unit on 7 occurrences = Potential Underpayment of $13,665 37

Next Steps 38

Action Items Build custom edits into scrubber Perform periodic scrubber audits on custom & standard edits Education Use data-driven examples to educate all involved Re-bill claims when appropriate 39

Filing Time Limits Any service rendered between October 1 of one year and September 30 of the next year must be filed by December 31 of the following year: Date of Service File Claim By: October 1, 2004 September 30, 2005, file by December 31, 2006 October 1, 2005 September 30, 2006, file by December 31, 2007 October 1, 2006 September 30, 2007, file by December 31, 2008 October 1, 2007 September 30, 2008, file by December 31, 2009 Please refer to Internet-Only Manual (IOM), Pub. 100-04, Medicare Claims Processing Manual, Chapter 1, 70.8.6, at www.cms.hhs.gov/manuals/iom/ for additional information. 40

Final Thoughts Utilize benchmarking opportunities to provide focus for potential problematic areas specific to your facility. Improve future error rate by: Building custom edits in your facility s scrubber Perform periodic audits on your scrubber Provide education Results shown reflect Medicare only claims. Keep in mind many other payers base payment on line item reporting. Communication is key! 41

One of the reasons Cleverley + Associates is an industry leader is our commitment to quality. We are with you every step of the way, helping you to achieve absolute value in your organization. Contact Information Address 438 east wilson bridge road, suite 200 worthington, oh 43085 Phone 888.779.5663 Fax 614.413.3455 Email info@cleverleyassociates.com Web www.cleverleyassociates.com www.hospitaldx.com 42