How to shore up outpatient revenue integrity

by Caroline DelaCruz, RHIT, CCS-P, CPC, and Joseph J. Gurrieri, RHIA, CHP

Healthcare organizations and providers are experiencing a shift in outpatient reimbursement: from fee-for-service to Alternative Payment Models and value-based reimbursement based on quality outcomes. Coding errors, documentation gaps, claim denials, and accounts not billed due to claim edits are typically much higher on the outpatient side due to sheer volume. That presents operational and management challenges for organizations. This article focuses on emerging challenges and proven strategies to shore up outpatient revenue integrity as healthcare services continue to migrate toward outpatient settings.

Challenges related to the rise in outpatient services

As organizations acquire practices and open new clinics, the number of outpatient care locations is increasing. Accordingly, outpatient coding, documentation, and charging are becoming more important to ensure quality reporting and reimbursement—and to prevent denials. The following 10 issues associated with outpatient accounts require attention:

• Coding historically done by non-coding professionals
• Coding errors and documentation gaps such as missing CPT® codes and evidence of medical necessity
• Increases to the outpatient exception report or outpatient do not bill (DNB) (unbilled report)
• Hard-coded codes (assigned by the chargemaster) not visible or available when a coder is coding (soft-coding)
  • Prevents the Outpatient Code Editor (OCE) from scrubbing the entire set of codes while the coder is assigning codes
  • Leads to edits and billing delays on the back end, requiring costly rework
• Inadequate or missing charge validation process
• Outdated charge description master (CDM)
• Lack of true documentation improvement or query processes—can lead to missing or insufficient documentation to support the claim
• Lack of proper process for the assignment of correct and applicable modifiers
• Prescriptions or orders, especially from external providers, that lack specificity and/or the correct ICD-10-CM code to justify medical necessity for the procedure or diagnostic test
• Pre-authorizations from insurance companies not matched to the diagnosis or procedure codes submitted

The rise in outpatient denials results in overwhelmed coding staff who must handle all denials that revert back to the HIM department, whether or not HIM is responsible for the coding of that service.

Summary of steps to improve outpatient revenue integrity

• Audit your outpatient coding, charging, and documentation
• Assign outpatient encounters to coders for coding
• Reduce coding errors and identify opportunities to improve documentation
• Validate, resolve, and prevent missed or inaccurate charges
• Enhance management and resolution of unbilled accounts
• Reduce denials by eliminating root causes
• Track, trend, and analyze all accounts to closure in real time

Editor’s note: This article originally appeared in HIM Briefings. Click here to read the full version.

DelaCruz is the manager of comprehensive outpatient revenue integrity services at Pena4. She was previously at New York Presbyterian/Lawrence Hospital, where she was a coding supervisor responsible for overseeing coders and coding coordinators, daily coding operations, and workflow. She monitored the inpatient and outpatient DNFB report, collaborated with CDI to review DRG mismatches, participated in the upgrade of encoder and computer-assisted coding, implemented and led the transition of the telecommuting coding program, and initiated and implemented workflow processes for the department’s CDM. She joined Lawrence Hospital in 2013 as a coding coordinator. During her HIM career, she held various titles such as compliance coding analyst/team leader, OPD/coding consultant, director of coding, manager of HIM hospital-sponsored ambulatory services, clinical data coordinator, and manager of the medical records department.

Gurrieri is the president and CEO of Pena4. He has more than 20 years of HIM experience. He has held various positions in hospitals in New York and New Jersey, including assistant, associate, and director of HIM at Long Island College Hospital in Brooklyn, New York, from 1994 to 2000. He also served in over a dozen consulting interim management/director roles in New Jersey hospitals. With his strengths in process design, workflow, and information technology, Gurrieri was also behind the development and implementation of several software applications, including a medical coding productivity and quality measurement application, a DNFB management application, and a HIPAA accounting of disclosure tracking and reporting web-based application.