HCM 345 2-1 Journal - compliance, coding and reimbursement PDF

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compliance, coding and reimbursement...

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HCM 345 2-1 Journal Compliance, Coding and Reimbursement Jill Spaulding May 12, 2020

Proper billing and coding can make or break any healthcare organization’s bottom line. Healthcare is a business just like any other industry, but the healthcare industry is held to a set of standards like no other when it comes to being reimbursed for the services that they provide. The standards that have to be upheld are found within the billing and coding portion of the reimbursement process. The need for proper billing and coding within a healthcare organization is imperative. If these processes are not performed properly, the provider will not receive full payment for the services that they provided or the services that were provided could also be denied. The bottom line is if a healthcare organization maintains compliance in regards to regulations, billing, coding and documentation processes, it will help the organization to identify best practices which will help minimize inefficiencies and improve accuracy of claims when they are filed. There are a number of regulations that impact how or if a healthcare organization is going to be reimbursed for their services that they provide to a patient. One of the national government laws that regulates the medical industry in regards to billing is the Health Insurance Portability and Accountability Act. (HIPAA). HIPAA was implemented in 2003 to protect patient privacy and it controls what information can be included on medical bills (Hamilton, 2017). HIPAA’s main purpose is to maintain patient confidentiality. Within the hospital out-patient physical therapy facility that I work in, we have yearly tests to complete for our employment and one of the tests is in regards to HIPAA, patient confidentiality and how to maintain it. Also, each patient that comes in for their initial evaluation must sign a HIPAA form stating that they were informed of their right to privacy and that right includes the confidentiality of their medical information. HIPAA also requires the use of ICD-10 codes, this allows for more specificity in the reporting of patient diagnoses (MB-Guide, 2020). The ICD-10 codes improve accuracy to a

2 patient’s medical documentation along with helping claims that are sent to the payer to be timelier and error-free which will speed up the reimbursement process. Another set of regulations that can affect billing and coding is the False Claims Act. The False Claims Act is a federal law that makes it a crime to knowingly falsify any record or claim made through federal or state healthcare systems that provide health benefits (Smith, 2020). The False Claims Act was passed in 1863 and is also known as the “Lincoln Law” since it was passed during Abraham Lincoln’s administration. In the 1990’s the False Claims Act started to be applied to healthcare fraud (Lawsuit Legal, 2018). The False Claims Act is one of the most important federal and state laws that protects a patient from a healthcare provider to bill for services that were not performed or that were unnecessary. If a provider violates this law, it could prohibit the organization in participating in federal and stated healthcare programs along with being fined. This is where accurate documentation within a patient’s medical record comes into play. If documentation within the medical record is not accurate and a service is not documented, then the service did not happen and therefore it cannot be billed. As technology in documentation and billing has become more advanced in healthcare, a newer law came to be in 2009. This law is the Health Information Technology for Economic and Clinical Health Act (HITECH Act). The HITECH Act was signed into law in February 2009, to promote the adoption and meaningful use of health information technology (U.S. Department of Health and Human Services, 2017). This act was created since technology was advancing and many healthcare organizations were moving from paper to electronic health records (EHR). The HITECH Act encourages healthcare facilities to move from paper charts to electronic charts. By doing this it will reduce the risk of errors or misinterpretations of care that was given by the

3 provider. With this decrease in error it will improve a healthcare organization’s ability to properly code each patient encounter. The HITECH Act, False Claims act and HIPAA all play an important part when it comes to protecting a patient’s information and making sure that the healthcare organization charged the patient honestly for the care they provided. Each of these regulations also help healthcare organizations stay compliant and help to decrease the risk of having a claim denied by a payer. The tasks that each healthcare department performs can benefit or adversely affect the reimbursement cycle of a healthcare organization. The departments that perform these tasks are clinical services, the patient accounts department, Health Information Management (HIM) and administration. Each area must pay attention to every small detail in regards to the specific tasks that they perform on a daily basis. What the healthcare reimbursement process has to have so the provider can be compensated appropriately is the ability to provide detailed and precise documentation of care to the patient’s payer. Clinical services are where the documentation process begins. Clinical services are where every piece of clinical documentation in the medical record is completed (Harrington, 2020). During each patient’s visit or encounter, the healthcare provider has to document the patient’s history, problem, information collected during the exam and any treatment that was provided. Documentation for each encounter must be exact so the proper medical codes can be assigned. These codes are required because they demonstrate the need for that patient’s medical care during the visit.

4 The next department that has input to the reimbursement process is the patient accounts department. The patient accounts department is in control of collecting every transaction that was recorded in the patient’s account through the charge description master, generating a bill for the payer and sending the bill to the payer by either paper or electronically (Harrington, 2020). A charge description master is a comprehensive list of every billable service or item that a healthcare organization can bill to a patient’s health insurance. Ultimately the charge description master is the origin of a patient’s bill. The third department that has input to the reimbursement process is Health Information Management (HIM). HIM is entirely responsible for the soft coding of the inpatient medical records (Harrington, 2020). HIM is as important to the reimbursement cycle as precise and accurate documentation is from the clinical services area. HIM’s role is indispensable because it validates the clinical care that was provided to a patient by making sure the care received was coded properly and that all care and services were rendered as ordered. The codes assigned by HIM are important because they translate what was performed as part of the treatment into terms that payers use to understand the services that were provided and why. The last department that affects the reimbursement cycle is administration which reviews financial transactions. The transactions that are scrutinized by the administration can occur throughout the facility and include employee wages, purchasing equipment and supplies along with services performed by some departments for another (Harrington, 2020). Not only does the administrative team go over each financial occurrence for the organization, they also work with insurance companies to set up and maintain contracts related to fees for service. If the financials

5 and insurance company contracts are not reviewed and maintained, it could impact a healthcare organization’s bottom line and lead to denied claims. In the end, billing and coding regulations along with the tasks that have to occur within each healthcare department play a part in the reimbursement process for every healthcare organization. If a healthcare organization wants to be successful, understanding the intricacies of the healthcare billing and coding regulations will help ensure compliance. Besides making sure regulations are followed, having accurate patient information that flows freely from one healthcare department to another within the reimbursement process will facilitate proper coding and billing of an encounter. If each of these steps can be adhered to, it will lead to a clean claim for the healthcare organization and avoid any unnecessary corrections that can slow down a claim and possibly deny payments.

References: Hamilton, R. (2017). Medical Billing Laws. Retrieved from https://www.legalbeagle.com/ 6766802-medical-billing-laws.html Harrington, M. (2020). Health Care Finance: And the Mechanics of Insurance and Reimbursement (2nd ed.). Jones & Bartlett Learning. Lawsuit Legal (2018). The False Claims Act Explained. Retrieved from https://www.lawsuitlegal.com/the-fals-claims-act-explained MB-Guide (2020). The Most Important Medical Billing Laws. Retrieved from https://www.mb-guide.org/medical-billing-laws.html Smith, A. (2020, April 10). False Claims Act – Healthcare Fraud Prevention and Penalties. Retrieved from https://www.firstquotehealth.com/health-insurance-news/false-claims-actHealthcare U.S. Department of Health and Human Services (2017, June 16). HITECH Act Enforcement Interim Final Rule. Retrieved from https://www.hhs.gov/hipaa/for professionals/specialtopic/hitech-act-enforcement-iterm- final-rule/index.html...