Healthcare Reimbursement Update, Part 2

2014 Reimbursement
Update Impact on
education and clinical
practice for
communication Sciences
and Disorders- Part two
Robert C. Fifer, Ph.D.
Mailman Center for Child Development, University of Miami
 Program evaluator for Duke University Medical
School and University of Texas Medical Branch
 Presenter at New Mexico Speech and Hearing
Association, North Carolina Academy of Hearing
 Member Genetics and Newborn Screening Advisory
Council, Florida Department of Health
 Consultant to Children’s Medical Services
Audiology Review Committee
 Member ASHA’s Health Care Economics
Documentation Requirements
1997 Documentation Guide for E/M Coding
• History (Soap):
– Medical necessity for why the patient is there
• “Referred by” is not medical necessity
• Requires a history covering the following areas as
Chief Complaint
Duration of symptoms
Family history
Social / occupational history
Prior medical history
Relevant diagnoses
– This section justifies all that is done
Documentation Requirements
 Actions and results (sOap)
 Describing what was done
 The test forms cannot stand on their own
 Most professionals don’t know what it is or
what the raw results mean
 Description of procedures and observations
 Procedure description can be “canned”
 Description of what was found (results)
Documentation Requirements
– Clinical Assessment (soAp)
• Must have a clear statement of practical and clinical
• Must flow logically from the history and the findings
– Recommendations (soaP)
• Logical conclusion to the matter.
• Based on these outcomes, the following
recommendations are offered:…………
• Each recommendation must be supported by history,
findings, and interpretation
• Do not list unsupported recommendation
Additional Notes on Recommendations
 Medical Necessity
 All recommendations must be supported by the
concept of “medical necessity”
 Recommendation should not be offered that is for the
convenience of health care provider or patient
 Transfer to plan of care
 Use of report
 Separate document (Recommended)
Other Requirements
• Signature
– If a paper report, must be an original signature
– Facsimile or stamped signature is not appropriate
– If electronic medical record (EMR), your login
constitutes your signature
• Date
– Date of service must be specified and prominent in
– Other dates may include date of review, date of
“signing”, date of dictation. These must be
distinguished from date of service.
Impact of ICD-10 on
 ICD-10 allows greater specificity in diagnosis
coding and will be even more so if functional scales
are added
 Description of patient status in report will need to
be more detailed in order to complement and justify
the specific ICD-10 code selected
 Will affect descriptions of what was found and
clinical assessment statement.
Say What You Mean – Clearly!
 I saw your patient today, who is still under our car for
physical therapy
 The patient lives at home with his mother, father, and pet
turtle, who is presently enrolled in day care three times a
 Patient has chest pain if she lies on her left side for over a
 Discharge status: Alive but without permission. Patient
needs disposition; therefore we will get Dr. Blank to
dispose of him
Say What You Mean – Clearly!
 The patient was to have a bowel resection.
However, he took a job as stockbroker instead.
 The patient is tearful and crying constantly. She also
appears to be depressed.
 The patient refused an autopsy.
 The respiration tube was disconnected and the
patient quickly expired.
Personal Observations
 Consists of audiogram with some notes
 Ex: Referred by Dr. Razzelfratz for hearing test.
Recommend hearing aids
 Fails to meet federal guidelines for
minimum documentation standards for
covered services
 Therapy notes incomplete or has sign-in
sheets only
Diagnosis Coding
 October 1, 2014
 To International Classification of Diseases, 9th
Revision, Clinical Modification ICD-10-CM
 ICD-9-CM: Approximately 18,000 codes
 ICD-10-CM: Approximately 64,000 codes
 Provides more flexibility for adding new codes
Clinical Billing
Coding “Normal” Diagnosis
 Medicare guidelines on code selection
 Not allowed to be “normal” within the ICD-9 or
ICD-10 coding system
 Code signs / symptoms that caused you to do the
 Some recommend use of a V code for test encounter
following (for example “Examination following a
failed screening”
 H90 Conductive and Sensorineural Hearing Loss
 Includes:
 Congenital deafness
 Excludes:
 Deaf mutism NEC (H91.3)
 Deafness NOS (H91.9)
 Hearing loss NOS (H91.9)
 Noise-induced (H83.3)
 Ototoxic (H91.0)
 Sudden (idiopathic) (H91.2)
 H90.0 Conductive hearing loss, bilateral
 H90.1 Conductive hearing loss, unilateral with
unrestricted hearing on the contralateral side
 H90.2 Conductive hearing loss, unspecified
 Conductive deafness NOS
 H90.3 Sensorineural hearing loss, bilateral
 H90.4 Sensorineural hearing loss, unilateral with
unrestricted hearing on the contralateral side
 H90.5 Sensorineural hearing loss, unspecified
 Congenital deafness NOS
 Hearing loss:
 central } NOS
 neural } NOS
 perceptive } NOS
 sensory } NOS
 Sensorineural deafness NOS
Emphasis on Outcomes
 Congress is eager to do away with the
therapy caps and the exceptions process and
go to a simpler system.
 Now requires CMS to collect functional
status and outcomes measurements
 Seven-level functional outcome system to be
phased in this year for therapy services
 Similar to NOMS in structure
Changing Landscape
 International Classification of Functioning,
Disability and Health (ICF)
 Describes body functions, body structures,
activities, and participation
 Useful for understanding and measuring
 ASHA has information available online
ICF Levels
No impairment means the person has no problem
Mild impairment means a problem is present less than 25%
of the time, with an intensity a person can tolerate, and
happened rarely over the last 30 days.
Moderate impairment means a problem is present less
than 50% of the time, with an intensity that is interfering in
the person’s day-to-day life, and happened occasionally
over the last 30 days.
Severe impairment means a problem is present more than
50% of the time, with an intensity that is partially
disrupting the person’s day-to-day life, and happened
frequently over the last 30 days.
ICF Levels
Complete impairment means a problem is present more
than 95% of the time, with an intensity that is totally
disrupting the person’s day-to-day life, and happened
every day over the last 30 days.
Not specified means there is insufficient information to
specify the severity of the impairment.
Documentation and Audits
 Greatest problem in audits
 Often inadequate and over-simplified
 Often not clear
 Mismatch between CPT and diagnosis
codes unsupported by documentation
 To protect the Medicare Trust Fund
Medicare QIO (Quality Improvement Organization)
CERT (Comprehensive Error Rate Test)
RAC (Recovery Audit Contractor)
ZPIC (Zone Program Integrity Contractor)
MAC (Medicare Administrative Contractor)
PSC (Program Safeguard Contractor)
OIG (Office of Inspector General Audits)
 To protect Medicaid funds
MIP (Medicaid Integrity Program)
MFCU (Medicaid Fraud Control Unit)
RAC (Recover Audit Contractor)
IMRO (Independent Medical Review Organization
“In Your Presence” Audits
 QIO: Improve effectiveness, efficiency, economy,
and quality of services provided to Medicare
 MAC Audits: Sampling of patient records to ensure
quality of service delivery and completeness
 MIC reviews: Looking for overpayments and billing
 MIC Audits: Looking for fraud often with local law
enforcement (can also be behind the scenes)
“Behind the Scenes”
 ZPIC oversees the RACs and approves their CPT
code selection for data-mined audits
 RAC searches the Medicare and Medicaid data
bases for inappropriate billing patterns that violate
principles of code reporting
 PSC obtains information from RACs regarding
possible fraud and abuse
Recovery Achievements
 RAC Pilot Project
 3 year demonstration
 6 states
 $1.3 billion recovered in overpayments
 Overpayments
 Medicare: $49.9 billion in 2013
 Medicaid: $14.4 billion in 2013
 Point of comparison
 Deficit reduction bill by Rep. Ryan cut $20 from
Attributes of
 Administrative and documentation errors
 Medically unnecessary services
 Diagnosis coding errors
 Inappropriate procedure code reporting
Prevention of Bad
 Correct coding
 Types of codes
 Don’t go “code fishing”
 Be truthful in code selection
 Documentation
 “If it wasn’t documented, it never happened”
 The audiogram cannot stand alone, not even with notes
 Six elements of documentation – EVERY TIME
 Medical necessity – justify ALL procedures
Clinical Billing
Code Selection
 With rare exception, do not go outside of our family
of codes for SLP and Aud services
 Do not code shop for what sounds good without
understanding the procedure represented by that
 If a procedure does not have a code, use the
unspecified/unlisted code 92700
 Know the difference between a unit code, contact
code, and timed code
Clinical Billing
Code Type
 Contact code
 Untimed code reported once per date of service
 Will have no unit or timed designation in the descriptor
 Unit code
 Report the code up to a maximum number of times per date
of service
 Designated by maximum number of units in descriptor
 Timed code
 Designated in descriptor by “1st hour” or “each successive 15
Clinical Billing
Timed Codes
 Usually the report preparation is included in the
intra-service time. It will be designated “with
report” if that is true
 Be conservative when reporting the portion of time
devoted to report writing
 Document in progress notes the start time and stop
time for the face to face contact
Clinical Billing
 Medicare requires 100%, in the room supervision
 Medicare pays for the licensed professional’s time and
not the student’s effort
 Decision-making must be by the professional
 Cannot be involved with care of a second patient
 Medicaid
 Supervision may vary from state to state
 Typically professional contact with family and
student to ensure appropriate procedures, outcomes,
and decision-making
 Depending on the student, may not require 100%
The Question of Whether
to See Medicare Patients
 Depends on supervision level and medical necessity
 Practice patients / clients
 If supervision CAN be met and the decision is to see
Medicare patients, then must use an ABN if medical
necessity is not met (more on ABNs momentarily)
 If decision is to NOT see Medicare patients, then a
sign must be posted informing all patients / clients
that Medicare is not accepted because level of
student supervision cannot be done in accordance
with Medicare regulations
38 years of per capita spending by country
Per Capita Spending for Health Care; Source: Kaiser Family Foundation
Health Care Costs for American Families
Source: Milliman Medical Index
Health Care Costs for American Families
Source: Milliman Medical Index
Health Care Costs for American Families
Source: Milliman Medical Index
 Miami most expensive at $24,965.00
 Phoenix least expensive at $18,365.00
 Primary utilization factors influencing out of pocket
and overall expenses:
Inpatient facility care
Outpatient facility care
Professional services
Health Care Economics
 Cost inflation
Risen 78% since 2000 vs. 20% for salaries
Average 9% per year with range of 7%-13%
Defensive medicine (malpractice)
Unnecessary procedure/treatment (fee for
Ineffective treatment
Inefficient service delivery models
End of life care
Factors Affecting
 Sustainable Growth Rate (SGR)
 New models of reimbursement
 Procedure reviews
 New Challenges
Sustainable Growth Rate
 Part of the 1997 Balanced Budget
Amendment to keep Medicare budget
 Includes several factors to calculate the
reimbursement of Medicare services
 Independent from RVU assignments from
 Annual budget allocation from Congress
Sustainable Growth Rate
 Intended to control the growth of Medicare costs
 Payments for services not withheld if SGR targets
are exceeded
 If target expenditures exceed budget, the next year’s
update is reduced
 If target expenditures are below budget, the next
year’s update is increased
Sustainable Growth Rate:
How does it work?
 The estimated percentage change in fees for
physicians’ services.
 The estimated percentage change in the average
number of Medicare fee-for-service beneficiaries.
 The estimated 10-year average annual percentage
change in real gross domestic product (GDP) per
capita. (from 2008 forward)
 The estimated percentage change in expenditures
due to changes in law or regulations.
SGR Adjustments: 19902011
The “Doc Fix”: Introduced
February 2014
 Immediate repeal of SGR
 Transition period with 0.5% increase annually for 5 years
 Merit Based Incentive Program
 Value Based Modifier
 Meaningful Use for Electronic Medical Records
 5% added incentive payment to physician payment under
new Alternative Payment Models
 Increased funding for technical assistance to small physician
practices (<15 physicians)
 Creation of a technical advisory panel to review and
recommend Alternative Payment Models
Noteworthy Features of
“The Fix”
 Consolidates quality programs (e.g., PQRS, Value
Based Modifier, Meaningful Use) into one.
 Payments based on achieving performance
 Introduces the concept of alternative payment
 Incentivizes care coordination and shared
responsibility of patient care
 Requires ongoing development of quality measures
to evaluate performance
Other Noteworthy
Features of “The Fix”
 Increases transparency of metrics and quality
 Physician Compare website
 Posts quality and utilization data for patients to make
informed decisions about their care
 Allows qualified clinical data registries to purchase
claims data for purposes of quality improvement and
patient safety
Latest News on
Doc Fix 3/31/14
 Congress passed a bill to delay to freeze the current
situation for one year.
 Suspend 24% reduction in payments
 Extend the therapy caps exceptions until March
 Delay implementation of ICD-10 for one year
Other Factors Affecting
 CMS Screens of billed codes looking for
 Codes frequently reported together
 Codes that have never been surveyed by the RUC or
 Codes believed to be overvalued based on utilization
 AMA Responses to CMS
 Overseeing survey process
 Facilitating potential methods of payment revision
Physician Quality
Reporting Initiative
 One of three performance based reimbursement
factors affecting physicians – the primary
performance based factor for audiologists at present
 Began as an enticement to physicians to abide
quality of care standards
 Participation is now a requirement to maintain full
Medicare reimbursement
 Each health care discipline / specialty will develop
performance standards
 Quality measures as evaluated by National
Quality Alliance, Physician Consortium for
Performance Improvement, and CMS
 Has moved to mandatory participation
 Penalty Adjustment: -1.5% in 2015; -2% in 2016
and beyond
 Most recent rule for 2014 requires reporting on 9
measures. Audiology and speech-language
pathology exempted from that for now.
PQRS Measures
 Document or confirm the patient's current
medications for 50% of the eligible patient
visits for evaluation AND
 Indicate a referral to a physician for 50% of
the patients who report or are diagnosed
with dizziness
PQRS Measures
Speech-language Pathology
 Document or confirm the patient's current
medications for 50% of the eligible patient
visits for therapy
PQRS Measures
 PQRS applies to audiologists and SLPs in
private practice, group practice, or
university clinics.
 At this time, PQRS does not apply to
providers in facilities such as hospitals or
skilled nursing facilities.
 Separate enrollment is not required.
Additional PQRS Item:
 Under SGR repeal, each “society” will develop
discipline-specific measures
 Audiology is represented in this effort by the
Audiology Quality Consortium (AQC)
 AQC is comprised of representatives of 10
audiology organizations (list on ASHA, AAA, and
ADA websites)
 At this moment, there are 5 proposed measures in
Health Care economics: Do
I turn right or left to get to
the future?
Current Recommendation
 MedPAC: Move Away From Fee-for-Service
 Encourages increased utilization
 More services => more payment
 Questions of true medical necessity
 IOM and CMS: Move Away From Fee-for-Service
Medicare/CMS Actions
 Value-Based Purchasing
 Based on Medicare vision of “the right care for every
person, every time”
 Aligns payment to efficiency and quality of care
 Rewards providers for measured performance (read:
Value-Based Purchasing
 Promote evidence-based medicine
 Require clinical and financial accountability across all
 Focus on episodes of care
 Better coordination of care
 Payment based on outcomes, not number of sessions
(performance-based payment)
 Focus on effectiveness of treatment
Levels of Evidence
Level Type of evidence (based on AHCPR 1992)
Ia Evidence obtained from meta-analysis of randomized controlled trial
Ib Evidence obtained from at least one randomized controlled trial
IIa Evidence obtained from at least one well-designed controlled study
without randomization
IIb Evidence obtained from at least one other type of well-designed
quasi-experimental study
III Evidence obtained from well-designed non-experimental descriptive
studies, such as comparative studies, correlation studies and case
control studies
IV Evidence obtained from case reports or case series
V Evidence obtained from expert committee reports or opinions and/or
clinical experience of respected authorities
Bundled Payments
 Bundled payment models de-emphasize services
that increase utilization and cost
 Initiative by Center for Medicare and Medicaid
Innovation called Bundled Payments for Care
 Working to identify procedure groups to bundle,
based on diagnosis rather than procedure(s)
Current CMS Actions to
Reduce Payments
 Medicare screens for procedures reported
together => new, combined procedure CPT
codes (92540, 92550, 92570)
 Re-survey and re-validation of procedure
value (92587)
 Bundled payments under Medicaid reform
(more on this later)
Medical Home Model
 Primary care physician becomes medical
 All referrals will go through PCP
 Different from “gate-keeper” concept of HMOs
 PCP paid to coordinate and manage all care of that
 With rare exception, no physician/health care
provider will have “direct access” under medical home
Physician Private Practice
 Physicians are facing same pressures as hospitals
 Leaving private practice to become salaried
employees of hospitals and other large medical
 Lower costs
 Meet government mandates on electronic medical
 Percentage of physicians who own their own practices
 2000 – 57%
 2009 – 43%
 2013 – 33% (projected)
Physicians and Private
 Giving up fee for service or a salary…
Physicians lose autonomy
Gain more regular hours
Gain more predictable income level
Hospitals gain a guaranteed supply of patients from
the physicians practices
 Intent of health care changes under Obama
 More coordinated care (shared patient management)
 Leading to cost reductions and better patient
 Eliminate “silo” style of operation for patient care
Emphasis on Outcomes
 Patient Satisfaction and Wellness
 Patient Centered (What do you want me to do?)
 FQHC payment per encounter
 Average payment
 Diagnosis based
 Influence by Medical Home
 Shared responsibility for care (Again, emphasis on
Care Coordination and elimination of silos)
Emphasis on Patient
Centered Care
 Remove traditional prescriptive perspective from
SLPs and Auds
 Patient / family actively participate in decisionmaking
 Patient / family establish goals to be achieved
 SLP / Aud role to educate, evaluate, guide,
Standard Versus
Custom Protocols
 Every procedure must be supported by history or
other test findings
 Every protocol must be customized for each patient
based on the clinical question to be answered
 What we currently know of reimbursement
directions indicate that it will be necessary to do
what is necessary and stop there
 Bottom line: the individualized clinical question will
be the driving force for what is done diagnostically
Effects on Audiology
 We are not physicians, but sometimes the system
treats us like physicians for payment and policy
 We don’t know what our reimbursement will look
like, but we have some hints based on physiciancenter proposals and movements away from fee-forservice
 Pay attention to the diminishing physician private
practice and move toward joining large health care
Effects on Audiology
 Changes in health care will require that you
determine cost of service delivery
 Carefully evaluate each procedure being performed
(e.g., develop a clinical question and determine what
tools are necessary; stay away from graduate school
protocol …
 Time is money and each additional procedure is
 Justify what you do based on case history and
outcome of previous test
Effects on Audiology
 Anticipation that payment may be based on
diagnosis or “per patient” rather than procedure
 Replace fee-for-service with bundled code
crosswalked to diagnosis
 Bundled fee based on data-mining median costs of
procedures “typically done” to derive diagnosis
 May combine severity with diagnosis via ICF or similar
 Focus on participation in life activities (NOT ADLs—life
Effects on SpeechLanguage Pathology
 Anticipate episodic / periodic payments
Single payment
Covers all services
Covers specified period of time
Already appearing in Medicaid “reform”
 Single payment for date of service
 Based on diagnosis and level of severity
 Focus on FUNCTIONAL outcomes
 Realistic achievement of goals
 Activities of life
Reimbursement Summit
Factors Pressuring Change
 Unsustainable increasing cost of medical care
 Patient Protection and Accountable Care Act
 Increasing demands for quality, efficiency, and
accountability by
Health Care Rating Organizations
Accrediting bodies
Commercial payers
The Public
Triple Aim Focus of Change
Institute for Health Care Improvement
 Improving the patient experience of
care (including quality and
 Improving the health of populations
 Reducing the per capita cost of health
Impact on Graduate School
 Teach clinical judgment rather than strictly
procedures and protocol
 Mechanics of test administration are important, but
know when to stop (emphasis: Aud)
 Mechanics of test administration and therapy
techniques are important, but know how to set
realistic goals (emphasis: SLP)
 Develop a true sense of medical necessity, clinical
questions, patient-centered recommendations and
plan of care
Value of Health Care
“We practice according to
how we are paid”
Peter Hollmann, MD
Chair, AMA CPT Editorial
October 2011

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