Do you know what your evaluation and management (E/M) coding profile looks like? Rest assured, your carrier does, and the private insurers you submit claims to probably do too. The Centers for Medicare & Medicaid Services (CMS) has instructed Medicare carriers to analyze data on paid claims, and the 2004 work plan from the Department of Health and Human Services Office of the Inspector General also includes “aberrant coding patterns” as an area of interest. Comparing your E/M coding distribution with national benchmarks will help you maximize your practice’s revenue, identify aberrant coding patterns and make adjustments before they raise a red flag with payers.

Getting started

To evaluate your coding patterns, you’ll need to know how often you used each E/M code during the past year. Most medical billing software programs are set up to generate this type of report, often referred to as a CPT Productivity Report or CPT Utilization Report. If you can, run one report that reflects Medicare claims only and one that reflects claims for all your patients. This will allow you to make more accurate comparisons later.

Once you have these reports, you can then determine the frequency with which you submit each E/M code for each group of patients, starting with the codes that represent the majority of the services you provide. To calculate frequency percentages, start with the established patient office visit codes (99211 to 99215) and simply divide the number of times you used each code by the total number of times you submitted any of the established patient visit codes during the last year. (To develop a spreadsheet to help you calculate percentages, see “An Easy Way to Analyze E/M Coding for Group Practices,” FPM, July/August 2002, page 20.)

Once you have done this for each of the established patient codes, move on to the codes for new patient visits and so on. With this data, you’ll be ready to compare your findings with the national benchmarks.

Comparing coding patterns

If you were able to calculate separate percentages for Medicare patients, compare those to the CMS benchmarks in this article. If not, the data from the Medical Group Management Association will give you the most accurate snapshot of how your coding compares with national norms, since it reflects claims submitted for Medicare patients as well as those with private insurance. Of course you can also compare the percentages derived from your all-inclusive report to the CMS data, but you’ll need to keep in mind how your patient panel differs from a Medicare-only population.

Downcoding

Some physicians find the documentation guidelines so confusing that they consistently bill lower than their documentation would support, thinking, “Better safe than sorry.” But down-coding reduces overrall gross charges and the money left at the end of the year for salary. If your analysis suggests that downcoding might be occurring in your practice, you’ll need to address the problem.

Upcoding

If in comparing your codes with national benchmarks, you find you bill at a higher level than your peers, ask yourself, “Are my patients really different?” If the answer is “no,” make sure your documentation methods are not resulting in codes that are higher than you can justify on the basis of medical necessity. I have noticed that compared with handwritten or dictated notes, those generated with electronic medical records (EMRs) or templates with check-off boxes for normal findings can result in significantly higher levels of service being documented and billed, sometimes because the history and exam elements documented aren’t relevant to the patient’s problem.

For example, the exam components of the 1997 Documentation Guidelines include “external ears and nose.” Prior to auditing notes generated by EMRs, I rarely saw “external ears and nose” documented, and then only when the presenting problem was ENT-related. Now I often see it.

Medical necessity

Medicare specifically warns doctors against upcoding, even when it is justified by the documentation in the patient chart. According to the Medicare Carrier’s Manual, “Medical necessity of a service is the overarching criterion for payment in addition to the individual requirements of a CPT code. It would not be medically necessary or appropriate to bill a higher level of evaluation and management service when a lower level of service is warranted. The volume of documentation should not be the primary influence upon which a specific level of service is billed. Documentation should support the level of service reported.”

Consequently, the primary issues to consider when selecting a code should be medical necessity, the severity of the illness and the risk related to the diagnosis or treatment plan. After that, your level of documentation can be your guide.

Room for improvement?

If your coding profile is significantly different from national benchmarks or if your coding shows aberrant patterns such as billing all hospital admissions at the same level, you may want to conduct an internal coding audit (for more information, see “Take Charge of Coding: Don’t Lose Income to Neglect,” FPM, March 1999, page 37, and “Using Peer Review for Self-Audits of Medical Record Documentation,” FPM, April 2000, page 28). If a coding audit identifies significant errors, you and your staff may benefit from learning more about coding and the documentation guidelines.

To find educational programs in your area, check with your local hospital or state or local medical societies.

Worth the effort

Because carriers are analyzing claims data, doctors really have no choice but to follow suit. My advice? Audit your E/M notes regularly, at least annually. If you find discrepancies between your coding patterns and national norms, uncover the cause and work to correct the problem. Granted, this takes time, skill and attention, but it’s much less complicated than managing hundreds of complex patients. I guarantee it.