Creating a Closed Loop Denial Prevention Process

So, how do you create a Closed Loop Denial Prevention Process?  It requires a rules engine capable of finding claims that are destined for denial; preferably before they are posted to the PM system so that backend modifications and corrections are not needed and without creating a lag time prior to submission with negative cash flow impact.

With AccelaSMART, White Plume clients use their denials experience and payor communications to proactively set up customized rules. These rules are designed to prevent denials and improve 1st Pass Pay rates (the rate at which claims are paid with the first submission).  The customization available within AccelaSMART allows users to set up the specific criterion that applies to their services, coding, master files, providers, region, plans and other details about a specific claim to ensure it will pass the payor’s edits.  Think you don’t need that much granularity?  Remember, United Healthcare applies over 82,000 rules to adjudicate claims over and above the industry standards.  Think about that. 

Diagram 1 depicts a Closed Loop Denial Prevention Process, starting with the advent of a new policy or denied claim, building a customized rule to catch conditions that will trigger a denial, enabling the rule for all billers to use and thereby preventing the denial from happening again.

Diagram 1. – Closed Loop Denial Prevention Process
closed-loop-diagram

The great thing about a Closed Loop Denial Prevention Process is that it is scalable and uniform across an organization.  The process can be applied consistently for each biller, regardless of their experience, skill sets and day-to-day distractions.  It improves productivity with workflow designed to minimize errors and streamline corrections.  Using a closed loop process significantly reduces the time clinicians spend on getting claims paid and puts process improvement at the right point in the life cycle of a charge. 

Ultimately, a Closed Loop Denial Prevention Process improves cash flows and profitability by ensuring claims can be paid as they should be, quickly and completely.


Preventing Reimbursement Denials in Context

To better understand what a closed loop denial prevention process is, let’s first examine what the opposite would be and study what normally happens when a payor implements a proprietary rule.  According to AMA’s 2012 National Health Insurer Report Card, Aetna has over 62,000 proprietary rules in addition to over 1 million edits that are considered “industry standard”.  Table 1 shows the total number of claim edits by rule source, by payor.

Table 1. – Total number claim edits by type and payor

 

Aetna

Anthem

Cigna

HCSC

Humana

Regence

UHC

Medicare

CPT

 36,266

 36,796

 36,509

 36,796

 36,796

 36,815

 31,135

 36,568

ASA

 1,070

 1,070

 1,070

 1,070

 1,070

 1,070

 1,070

 1,070

NCCI

 860,694

 860,765

 860,765

 860,765

 860,765

 860,765

 860,765

 860,765

CMS

 184,220

 185,371

 185,365

 185,371

 185,371

 185,371

 169,178

 185,371

Payor-specific

 62,335

 76,726

 1,190

 123

 5,033

 5,000

 82,868

 19,683,450

 

In an environment where payors have free reign to define their rules and disclosure is optional; providers have to keep up with the ones that apply to their specialty, location, services, patient panel and other criteria.  Sometimes, advanced notification of the rules’ implementation is communicated in a newsletter, typically weeks before enactment.  Billers rely on manual methods (sticky notes) and to a large extent – their memories – to comply with these rules and count on their clearinghouse to catch what they have missed. 

But clearinghouses don’t always supply the means to catch all the proprietary rules and don’t delve into the granular nuances that aren’t applied nationally.  Catching these types of corrections is normally left to the intellectual capital found in a key employee or two who just “know” how to get claims paid; based on previous denial experience and their diligence in keeping current with new rules.  They are a valuable commodity and subject to the frailties of mankind, if not the lure of a better position or a different career path.  This describes the open loop process of denials prevention – relying on staff to remember and catch a soon to be denial before it is submitted.

Now how do you create a closed loop denial prevention process? Stay tuned for the next post! 


What is a Closed Loop Denial Prevention Process?

  • Closed loop; noun – a control system with a feedback loop that is activepayor-rule-changes-per-month
  • Denial; nounthe refusal to satisfy a claim, request, desire, etc.
  • Prevention; noun – an action that stops something from happening
  • Process; nouna systematic series of actions directed to some end

As the name implies, a Closed Loop Denial Prevention Process is one designed to prevent denied claims. This process uses a system of rules and edits to provide consistent feedback that is dynamically available each time conditions are present that will result in a denied claim.  The process alerts users to the potentiality of the denial and instructs modifications that will prevent the denial from occurring.

Beats the heck out of sticky notes. 

Even if they have never thought about the term closed loop denial prevention, this is a process that White Plume users know well.  They’ve most certainly been keenly aware that AccelaSMART™ is a dynamic, interactive method of finding potential denials and fixing them prior to creating charges and submitting claims.

So how do you actually prevent denials through a closed loop denial prevention process? Stay tuned… 


Even with EHRs, Practices Continue to Manually Code

In a recent report by the Office of Inspector General (OIG), OIG auditors observed that the majority of physicians who have adopted EHRs continue to code Evaluation and Management (E/M) services manually—even though most major EHR vendors offer technology that will code E/M services automatically.

For the past decade, the OIG has kept a close eye on E/M coding because the level of E/M visits reported are trending higher at present than in previous decades. EHR adoption is intended to increase the accuracy of medical coding (e.g., E/M codes); however, this report suggests that physicians still prefer to code E/M visits the “old fashioned” manual way rather than adopt a new technology to automate the process. 

The OIG report did not offer any insight as to why physicians are still coding E/M visits without the help of EHR tools. Some theories include: E/M modules cost more money on top of an already expensive EHR system, E/M templates are not user friendly to the physicians, or physicians may not trust any EHR system to code for visits that affect such a large percentage of the revenue. Regardless, physicians often code E/M visits incorrectly, resulting in either over or underpayments.

If EHRs are not proving useful in coding this area of medical services, then physicians must look to other sources to avoid coding errors during claims review.

 


Catch Diagnosis Sequencing and Supporting Diagnosis Code Errors

Did you know White Plume products can review claims for diagnosis sequencing and supporting diagnosis code errors? The April newsletter from the Medicare Learning Network (CMS) stated the following problems in recent audits: 

1. Incorrect principal diagnosis for Kidney and Urinary Tract Disorders 

2. Incorrect secondary diagnosis for Cholecystectomy 

3. Improper diagnosis sequencing for spinal infusions 

You can avoid unnecessary claims rejections by catching these coding errors on the front end of the billing cycle, and thereby avoiding extra costs associated with refiling. What can White Plume do for you? Contact us to find out. 


Tips to Avoid 5010 Rejections after July 1, 2012

By July 1, 2012—less than a month!—all health care providers in the U.S. are required to use the 5010 Transaction Set for filing claims. CMS warns providers to remember including a complete 9-digit zip code, billing provider address, and National Provider Identifier (NPI) on each form. In addition to CMS’s warning, the 5010 changeover includes…


Physician Suggests CMS Dismissed Forgoing ICD-10 for ICD-11 Too Soon

Discussions continue about going directly from ICD-9 to ICD-11. Dr. Matt Murray is a Pediatric Emergency Medicine physician who maintains a healthcare IT blog. In a recent entry, the discussion of moving directly from ICD-9 to ICD-11—thereby skipping ICD-10 entirely—was renewed. Murray presented his concern that this option was dismissed in the CMS proposed rule to delay ICD-10 without truly analyzing the comparative costs of each roadmap.

“CMS prematurely dismisses (in three short sentences) the alternative to forgo ICD-10 and implement ICD-11 instead.”
Dr. Matt Murray in Digitized Medicine

Below are the “three short sentences” in the Federal Register to which Dr. Murray refers (CMS-0040-P):

“The option of foregoing a transition from ICD–9 to ICD–10, and instead waiting for ICD–11, was another alternative that was considered. This option was eliminated from consideration because the World Health Organization, which creates the basic version of the medical code set from which all countries create their own specialized versions, is not expected to release the basic ICD–11 medical code set until 2015 at the earliest. From the time of that release, subject matter experts state that the transition from ICD–9 directly to ICD–11 would be more difficult for industry and it would take anywhere from 5 to 7 years for the United States to develop its own ICD–11–CM and ICD–11–PCS versions.”

Dr. Murray suggests eight areas of impact that have not been fully assessed by CMS and should be considered. These include timing and cost issues and the burden of two conversions over the upcoming years, especially on physicians and small hospitals. To visit his blog, along with a link to his full public comment as submitted to CMS, click here.

Alternative Perspective

It is unlikely that CMS will wait 5 or more years for the increased granularity provided by ICD-11. Even though ICD-11 may be still a topic of conversation, skipping ICD-10 and adopting ICD-11 has been likened to be building the fourth floor of a building without building the  second and third floors with ICD-10 first.

ICD-10 Transition Solution

White Plume Technologies continues on its path to ICD-10 readiness well in advance of the original ICD-10 deadline. Meanwhile, we carefully monitor a variety of sources about the actual deadline, which code set will be implemented, and who will be affected so that we can make course corrections as needed to smooth the way to compliance for our customers. Interested in hearing about our ICD-10 solution? Contact us.

 

 


ACO Benefits for Patients and Providers

Accountable Care Organizations (ACOs) are springing up nationwide to create an open channel of physician communication to optimize patient well being and care.

In a survey of 367 leaders in healthcare, 11 percent are currently part of an ACO and 39 percent reported planning join an ACO in the near future.

Patient Benefits

Having all medical care completed within an ACO will allow the patient benefits of:

  1. Open communication betweenfrom different specialties within the same ACO to determine solutions
  2. Fewer medical tests because doctors and hospitals will send records if previously done
  3. Reduced medical history paperwork because the information may be stored in the practice’s electronic health record (EHR or EMR)
  4. Established single point of contact for all questions concerning care
  5. Centralized network of physicians for the patient, creating a team cooperating to deliver comprehensive

Physician Benefits

  1. The majority of new ACOs will be physician-led which will keep the focus on patient care by leveraging technology in a way that reduces cost.
  2. Physicians could make money according to an article listed on Becker’s Hospital Review if:
    a.“If ACO participating providers are able to reduce payments to other providers that are outside of the ACO.“
    b.“The inflation rate used to increase the cost targets is disproportionately higher than the actual rate at which the ACO’s provider payments would increase over time. “ (However, this “couldn’t be counted on.”)
    c.“Payments to the ACO’s providers really do decrease, but the providers are able to decrease their costs proportionately, so that the effect on net income is zero or positive.”

To learn more about ACOs and their effect on the industry, browse this list of references. 


Coding Multiple Surgical Procedures

When physicians perform multiple surgical procedures on a patient during the same session, certain rules must be applied in order to code the claim correctly. Claims must be reviewed to make sure the codes are reported in compliance with bundling rules, National Correct Coding Initiative (NCCI) edits, and relative value units (RVUs). Code Order Matters…


Coding Multiple Surgical Procedures for Current Clients

When physicians perform multiple surgical procedures on a patient during the same session, certain rules must be applied in order to code the claim correctly. Claims must be reviewed to make sure the codes are reported in compliance with bundling rules, National Correct Coding Initiative (NCCI) edits, and relative value units (RVUs).

Code Order Matters

Surgeons are paid at 100% of the fee schedule for the primary surgical procedure, and at 50% for all subsequent surgical procedures performed during the same surgical session. As such, the procedure with the highest RVU should always be listed first. The Medicare Physician Fee Scheduled Database (MPFSDB) lists the RVU value for each surgical CPT® or HCPCS code. The MPFSDB is updated annually, and the current version is located on The Centers for Medicare & Medicaid Services (CMS) website

If a surgical code with a lower RVU value is listed as the primary surgical procedure on the claim, insurance companies will pay the claim at the lower RVU rate—leading to a lower reimbursement rate.

Current Clients: White Plume’s AccelaSMART product offers Procedure Sequencing at the click of a button, relieving pressure on the billing staff to remember the RVU of all procedures.

Watch out for Unbundling

CMS developed the National Correct Coding Initiative (NCCI) to prevent invalid code combinations from being paid. NCCI edits are classified into two major categories:

  • Column 1/Column 2 Edits (Status 0) – Code pairs that are not normally reported together because one of the procedures is already considered a component of the other procedure
  • Mutually Exclusive Edits (Status 1) – Code pairs that are not reasonably performed together in the same operative session for anatomic reasons

Code pairs with a status indicator of 0 cannot use modifiers to override the NCCI edits. However, code pairs with status indicator of 1 can use certain modifiers to bypass an NCCI edit, when used appropriately. These modifiers include the following:

  • Anatomic modifiers: E1-E4, FA-F9, TA-T9, LT, RT
  • Coronary artery modifiers: LC, LD, RC
  • Global surgery modifiers: 58, 78, 79
  • Other modifiers: 59

Click here to access a list of NCCI edits.  

Current Clients: The AccelaSMART validation product contains the NCCI edits including “Status 0” verses “Status 1” information. If a code pairing violates bundling edits, our messages will tell you if the pair accepts a modifier for correction or not. The message even suggests the appropriate modifier. The user does not have to research the pair! 

Modifier 59

Modifier 59 is often used to report subsequent procedures that are separate and distinct from the primary procedure. The criterion for “separate and distinct” means that the procedure was performed:

  • During a different operative session
  • On a different organ
  • On a different incision or excision
  • For a different injury or lesion

Current Clients: The AccelaSMART validation engine alerts users when a Modifier 50 is acceptable and suggest review of documentation to ensure it is a valid submission for the encounter.


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