Medical Billing Basics



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Ingenix Learning: Medical Billing Basics 2010 8th edition

Contents Introduction... 1 Welcome to the Career of Medical Coding...1 The Nature of Medical Coding...1 Coding and the Financial Picture...2 Supporting Organizations...3 Opportunities in Coding...5 Chapter 1: Medical Terminology and Anatomy... 7 Introduction...7 History...7 Spelling...8 Approaches to Medical Terminology...8 Introduction to Human Anatomy...10 Integumentary System...14 Musculoskeletal System...16 Respiratory System...24 Cardiovascular System...29 Lymphatic System...35 Digestive Tract...38 Urinary System...48 Endocrine System...54 Nervous System...57 Eye Ocular Auditory...60 Planes...64 Summary...65 Discussion Questions...65 Chapter 2: Insurance Basics... 67 Introduction...67 History...67 Medicare and Medicaid...67 Health Insurance Today...68 Payer Comparisons...69 The Reimbursement Process...77 Coverage Issues...77 Payment Methodologies...77 Fee Schedules and Relative Values...78 Capitation...78 Inpatient and Ambulatory Systems...79 Claim Submission...79 Common Insurance Terminology...80 Fraud and Abuse Issues...80 Summary...81 Discussion Questions...81 Chapter 3: Coding Physician Services and Procedures... 83 Introduction...83 CPT History...83 Who uses CPT codes?...84 Documentation and the CPT Code Book: Reviewing the Source Document... 85 CPT Coding Conventions... 86 Guidelines... 88 Code Changes... 89 Resequencing of CPT Codes... 89 Modifiers... 90 Modifier Impact on Reimbursement... 91 Add-on and Modifier 51 Exempt Codes... 92 Unlisted Procedures... 93 The CPT Code Book Index... 93 The 10 Steps to Basic CPT Coding... 94 Evaluation and Management Services... 95 E/M Service Guidelines... 96 Evaluation and Management Service Levels... 98 Selecting a Visit Code... 98 New and Established Patient Services... 99 SOAP Note... 99 Main Categories of the Evaluation and Management Section... 104 Anesthesia... 108 Surgery... 111 Surgery Section Guidelines... 114 Ancillary Services... 117 Technical and Professional Components... 117 Radiology... 118 Pathology... 121 Medicine... 124 Summary... 125 Discussion Questions... 126 Chapter 4: Diagnosis Coding and ICD-9-CM...127 Introduction... 127 History... 127 ICD-9-CM Diagnosis Coding... 128 Organization... 129 Coding Guidelines... 129 Documentation and Diagnosis Coding... 129 ICD-9-CM, Volume 2... 130 ICD-9-CM, Volume 1... 133 Supplemental Classification: V Codes... 136 Appendixes to Volume 1... 137 Conventions... 138 Assigning Diagnosis Codes... 143 Clinical Applications of Coding Guidelines... 146 ICD-10 Coding System... 147 Summary... 151 Discussion Questions... 152 CPT only 2009 American Medical Association. All Rights Reserved. i

Chapter 5: HCPCS Level II Coding...153 Introduction...153 HCPCS Level I /CPT Coding System...153 HCPCS Level II National Codes...153 The HCPCS National Codes in Detail...154 HCPCS Codes...155 Use of HCPCS...156 How to Use HCPCS...156 Color-Coded Coverage Instructions...156 Modifiers...157 Unlisted HCPCS Codes...158 Practicing the Principles...158 Hospital Outpatient Services...159 Physician Office Services...159 DMEPOS...160 The HCPCS Level II Codes...162 Summary...163 Discussion Questions...163 Chapter 6: Medical Coding and Practice Management...165 Introduction...165 Registration...165 Encounter Forms...166 Precertification and Preauthorization...166 Claims Submission and Processing...168 Problem Claims...169 Advance Beneficiary Notice...169 Charge Amounts...170 Physician Reimbursement Methodologies...170 Inpatient Reimbursement Methodologies...171 Diagnosis-Related Group...172 Postpayment Process...174 Red Flags Rule...177 The Medical Record and Documentation...178 Inpatient Charting...181 Compliance and Legal Considerations...184 Summary...186 Discussion Questions...186 Chapter 7: Inpatient Coding...189 Introduction...189 The Coding Process...189 Inpatient Reimbursement Overview...190 New Medical Services and Technologies...191 ICD-9-CM, Volume 3...192 Reviewing the Operative Report...198 Sequencing Procedure Codes...199 Using the Index...201 Using the Tabular Listing...202 Putting ICD-9-CM Procedure Coding to Work...205 Using Software in Code Assignment...207 ICD-10 Coding System: The Future of Coding...207 Summary...208 Discussion Questions...208 Chapter 8: Coding for Outpatient Facility Services APCs and ASCs...209 Introduction...209 Outpatient Services Defined...209 Claims Processing...210 APCs and the Outpatient Prospective Payment System...211 Services Covered in an APC...215 APC Cost Controls...216 Ambulatory Surgery Center...219 Legislation Affecting Reimbursement...220 ASC Payment Groups...221 Summary...226 Discussion Questions...226 Appendix A: The Office of Inspector General 2010 Work Plan for Medicare Physicians and Other Health Professionals.227 Appendix B: Additional Word Roots, Prefixes, and Suffixes...233 Appendix C: Student Exercises...241 Glossary...275 Index...301 ii CPT only 2009 American Medical Association. All Rights Reserved.

The kneecap (patellofemoral) joint (patella and femoral trochlear notch); the patella, or kneecap, is a small, triangular bone anterior to the knee joint Greater trochanter Head of femur Symphysis pubis Obturator foramen Ischial tuberosity Lower Extremity Tensor fascia lata (cut) Head of femur Iliacus (underlies sartorius) Iliopsoas Symphysis pubis Adductor longus Psoas Sartorius muscle Lateral epicondyle Medial epicondyle Select muscles of the hip region The anterior cruciate ligaments (ACL) are located inside the knee joints and attach the femur to the tibia. DEFINITIONS arthroscopy. Use of an endoscope to examine the interior of a joint (diagnostic) or to perform surgery on joint structures (therapeutic). bunion. Bony prominence on the inside of the foot near the great toe. Articular cartilage is a tough, elastic tissue that covers the ends of bones in joints. Each lower extremity also includes the tarsals, metatarsals, and phalanges in the toes. The tibia, or shinbone, is the larger, medial bone of the leg and bears the major portion of the weight of the leg. The top ankle joint is composed of three bones: The tibia The fibula The talus The leg bones (tibia and fibula) form a pocket around the top of the ankle bone (talus) which allows the foots up and down bending. The subtalar is where the talus connects to the calcaneus (heel bone) and provides the foot s ability to rock from side to side. Three sets of fibrous tissues connect the bones and provide stability to both joints. The bumps on either side of the ankle are the ends of the lower leg bones; the bump on the outside of the ankle (lateral malleolus) is part of the fibula; the smaller bump on the inside of the ankle (medial malleolus) is part of the tibia. Foot and Toes The talus and calcaneus are on the posterior part of the foot and the talus is the only bone of the foot that articulates with the fibula and tibia. The calcaneous, or heel bone, is the strongest tarsal bone and bears the weight of the leg transmitted from the talus during walking. The metatarsus consists of five metatarsal bones and, like the metacarpals of the palm of the hand, each metatarsal consists of a base, shaft, and head. The phalanges of the foot resemble those of the hand; all but the big toe consists of a base, shaft, and head. The large toe, or hallux, has the proximal and distal phalanges. 22 CPT only 2009 American Medical Association. All Rights Reserved.

Components of the Medical Record A complete and accurate patient information sheet is usually the first component of the medical chart or record. KEY POINT Never allow any information from a patient record to be inadvertently or deliberately exposed to unauthorized individuals. Patient information falls into two categories general medical information and billing information. Because people may see more than one provider or they may move, change jobs, and switch insurance plans, patient information forms are updated on a regular basis. The following shows the information gathered in the office. Patient Medical Information A patient medical information form should contain the following: Patient s full name Current address and telephone number Date of birth Sex Occupation, employer s name, address, and telephone number Reason for visit Allergies (must be documented at each patient encounter) Current medications Previous medical history and pertinent family history Referring physician name, address, and telephone number Name and telephone number of person to contact in an emergency Patient Billing Information A patient billing form is separate from the medical record and contains the following pertinent information: Patient s full name Current address and telephone number Date of birth Sex Social security number Driver s license number Occupation, employer s name, address, and telephone number Responsible party (insured), address, and telephone number Reference: a relative or friend not living with the patient including address and telephone number Medical insurance information including address, contract or policy number, group number, and effective dates for coverage KEY POINT One of the most important elements in a patient s medical record is the health history. Preprinted Patient History Forms One of the most important elements in a patient s medical record is the health history. Preprinted checklist-style forms are often used to obtain a patient s history. Different types of forms are used in hospitals, although various departments sometimes use preprinted patient history forms as a screening tool. The physician should make pertinent comments, and date and sign the history form as part of the medical record. 180 CPT only 2009 American Medical Association. All Rights Reserved.