For Hospitals

Creating a Bridge between Physicians and IT

The Clinical mind aggregates data and makes clinical decisions based upon a variety of factors. The Current E&M structure is based on the premise that all of the ingredients are included when the physician reaches for the highest level of care. The importance of IT is to support clinical decision making by being able to include all of the parameters by which a patient’s outcome can be measured. Too often there is a big divide between how a clinician thinks and how Systems work. Unless that divide is bridged, than IT systems (clinical systems) may fall short of the goal of the support they are supposed to give. In a series of articles and in recent blogs in the Wall St. Journal practicing physicians have noted that the Electronic medical record takes more time and doesn’t give clinicians the support they need for practice. The only way to overcome this problem is to begin a process of identifying the critical markers in clinical thinking/decision making and have a “System” emulate them. A few years ago, HSMN worked with the faculty of a Medical School to find a “System”. The first and most important factor was to create a consensus on what data elements were most important, how they should be captured and maintained and how these would be communicated across an Enterprise with many clinical disciplines. HSMN helped to create a consensus which allowed the Medical Faculty to find common ground and then search for tool. At the beginning Vendors would come in and tell the faculty about the systems’ specifications unrelated to practice considerations. In the end, the faculty chose to create their own Electronic Medical Record for which it won a major award. Building the bridge with clinicians is the only means of guaranteeing success with a medical staff, group practice or single practitioner and the use of IT solutions.

Evaluation & Management

Evaluation and Management (E/M) as it applies to coding hospital visits, is the code by which hospitals relate the intensity of hospital resources to the different levels of effort represented by the code.  The Centers for Medicare and Medicaid (CMS) has stated that while their initial goal was to create national guidelines, they have found that the complex undertaking was proving more challenging then they originally thought. They concluded by stating that it seemed unlikely that one set of straightforward national guidelines could apply to the reporting of visits in all hospitals and specialty clinics.

In the absence of national guidelines, CMS will continue to regularly re-evaluate patterns of hospital outpatient visit reporting to ensure that hospitals continue to bill visit levels appropriately and differently, consistent with the hospital’s own internal guidelines. CMS then defined the following 11 principles they expect hospital guidelines to comprise (72 FR 66805):

  1. The coding guidelines should follow the intent of the CPT code descriptor in that the guidelines should be designed to reasonably relate the intensity of hospital resources to the different levels of effort represented by the code (65 FR 18451).
  2. The coding guidelines should be based on hospital facility resources. The guidelines should not be based on physician resources (67 FR 66792).
  3. The coding guidelines should be clear to facilitate accurate payments and be usable for compliance purposes and audits (67 FR 66792).
  4. The coding guidelines should meet the HIPAA requirements (67 FR 66792).
  5. The coding guidelines should only require documentation that is clinically necessary for patient care (67 FR 66792).
  6. The coding guidelines should not facilitate upcoding or gaming.
  7. The coding guidelines should be written or recorded, well-documented, and provide the basis for selection of a specific code.
  8. The coding guidelines should be applied consistently across patients in the clinic or emergency department to which they apply.
  9. The coding guidelines should not change with great frequency.
  10. The coding guidelines should be readily available for fiscal intermediary (or, if applicable, MAC) review.
  11. The coding guidelines should result in coding decisions that could be verified by other hospital staff, as well as outside sources (72 FR 66805).

Since the implementation of the APCs in 2000, HSMN has worked closely with facilities in developing internal E/M guidelines. Even now, we come across hospitals that have not assessed compliance with their internally developed guidelines or looked for opportunities to improve E/M reporting. HSMN is well known amongst providers for our work with clinical documentation, especially in our ability to abstract quantifiable data elements to meet coding and billing standards. Would your E/M coding guidelines stand up to an evaluation from CMS?


What do the following compliance risk areas have in common?

  • Billing for items and services not actually rendered,
  • Upcoding,
  • DRG creep,
  • Unbundling, and
  • Billing for outpatient services rendered in connection with inpatient stays.

These are just a few of the coding and billing errors that can put a hospital at risk for non-compliance. The OIG recommends that written policies and procedures along with training and educational programs place an emphasis on high risk areas such as coding and billing. All healthcare providers must have a Coding Compliance Program that includes written policies and procedures that serve as the facility’s rule book on the coding and billing processes—from documenting the clinical encounter to submitting the claim. Coding compliance policies serve as the how-to manual of coding and billing functions and represent the provider’s intent to be in compliance by correctly reporting services. These coding policies should be clearly written, comprehensive and at least cover:

  • clinical documentation requirements,
  • adherence to official coding resources,
  • payer rules and regulations, and
  • Business Associate agreements for outsourcing and consultants.

HSMN has been developing and implementing compliance programs with all provider types since the OIG published the first Compliance guidance for Hospitals. We understand the elements that constitute an effective compliance program. We also recognize that a “cookie-cutter” approach to developing a compliance program does not produce an effective compliance program. By learning the organization, we are able to help develop and implement a coding compliance program that is:

  • relevant based on day-to-day responsibilities,
  • includes risk-assessment tools that identify the weakness and areas of risk specific to the organization,
  • develop an audit and monitoring process focused on internal high-risk billing and coding issues as well regulatory work plans, and
  • most importantly, help foster an attitude of compliance, not a compliance program that sits on the shelf.

Medical Necessity

In 1998, the Office of the Inspector General published Compliance Program Guidance for Hospitals. In this guidance the OIG stated that “A hospital’s compliance program should provide that claims should only be submitted for services that the hospital has reason to believe are medically necessary and that were ordered by a physician or other appropriately licensed individual. As a preliminary matter, the OIG recognizes that licensed health care professionals must be able to order any services that are appropriate for the treatment of their patients. However, Medicare and other government and private health care plans will only pay for those services that meet appropriate medical necessity standards (in the case of Medicare, i.e., ‘‘reasonable and necessary’’ services). Providers may not bill for services that do not meet the applicable standards.” The OIG also states that particular attention should be paid to issues of medical necessity and puts the onus on hospitals to deliver this information to the health care professionals on its staff. Medicare Regulation requires the physician to provide an appropriate diagnosis when ordering services and the OIG directs the hospital to bill only for medically necessary services. How can a physician be expected to keep up with the myriad of policies, to know if a service is statutorily excluded, or to know if a service is guided by a Local Coverage Determination? How can the hospital know when it is appropriate to bill based on medical necessity guidelines? HSMN has lived these scenarios in many hospitals across the country. We have designed processes, systems, and education to eliminate compliance risk due to medical necessity issues. We start with the premise that physicians do not order services that are not medically necessary. At HSMN we understand that the key to mitigating compliance risk is in translating standard clinical practice in understanding and in accordance with the rules that define medical necessity criteria.

Training & Knowledge Transfer

Our clients tell us of the many engagements that conclude with a Final Report that is never implemented. The reason is usually, “We can’t do that here, we have never done that here” or “Sounds great but that is not who we are.”  The solution to a problem can only succeed if it can fit into the culture of the organization that recognizes The “Action” plan as something that works in their history and culture. The alternative is to change the culture or the people or the organization. At times that is what is necessary. For the most part, interviewing staff, especially with “institutional knowledge,” might give clues on feasible solutions in that setting.

In our 25 years of consulting, we have often found that a solution to a problem may be in linking it to something that had previously been done in an analog fashion but not transferred forward in a digital world.  The Consultant must appreciate the history and culture of the organization before a full-fledged “Action Plan” can be presented and implemented.

An important part of the “Action Plan” is to Transfer Knowledge to the client, no Black Boxes.  The famous line is: “I have been telling them this (consultant findings) for years, why didn’t they listen”?   HSMN listens very well so that the client (hospital employees) can recognize their own ideas in the solutions that are presented. A Consulting engagement to assess any area of practice in a healthcare organization must conclude with an implementable Action Plan.