Legal Nurse Consulting News: Deciphering the Code

Monday, May 11, 2009

By Kelly Pierce-Gonzales, RN, MSN, LNC-Csp

Billing for health care has become increasingly complex over the years. The field of Billing and Coding for health care costs and procedures has become a career path in itself. Countless colleges and universities offer courses to master this topic in order to help health care providers properly bill for their procedures and diagnoses. This topic is fluid and changes as the milieu of health care evolves and transforms. This article can not possibly cover all aspects of coding and billing, but instead will provide a brief overview so that the reader might understand how this process works here in the United States, even if unfamiliar with health care issues.

Coding is essentially a process that health care providers utilize in order to bill insurance companies for health care provided. The International Classification of Diseases, 9th Revision, Clinical Modification (ICD-9-CM) is one of the coding systems currently utilized by the United States and has been in effect since 1979. The ICD-9 system groups diseases and injuries or tests and procedures into numerical codes. Both procedure codes and diagnostic codes are included in this system. This coding system is updated annually in October and revised to show effective changes.

The ICD-9-CM system is very complex. This system was first utilized in the 1950ís as a way to classify diseases. It is still utilized for reporting diagnoses and diseases to the Public Health Services. Three volumes contain this coding system and are used to classify health care procedures and diagnoses. In light of the vast number of codes present, it is quite clear why a coder is required by health care facilities when billing for services rendered. A coder must first examine the patient's chart, find all the relevant diagnoses, and then place them in the proper order, according to primary diagnoses and secondary diagnoses. Often the secondary diagnoses will be further broken down to ensure accuracy of the claim.

In order for a health care provider to be reimbursed using the ICD-9-CM system, the patient will be grouped into a specific category based on his codes and then will be evaluated for Diagnosis-Related Group (DRG) assignment. The reimbursement from the insurance company will be based on the DRG assignment that the patient is placed in. Thorough documentation and completeness of patient records is vital to this process. If an essential piece of the patient record is missing, reimbursement amounts may be affected. If the diagnoses are not specific, this may also affect reimbursement. Open communication between coders and health care providers is necessary to ensure documentation of patient records is complete and correct so that the chart may be coded properly.

Current Procedural Terminology (CPT-4) codes are yet another category of coding used in the United States. Although the ICD-9-CM system is considered the accepted coding system in the United States, the CPT coding system is utilized in all states in conjunction with the ICD system, specifically when billing Medicare for procedures. The American Medical Association (AMA) developed this system of coding in the late 1970ís and owns the copyright as well. CPT codes are updated annually in January. These codes are usually 5 digit numerical codes and more than 7,000 CPT codes are currently utilized.

While the ICD-9-CM system focuses primarily on diagnoses with some procedural codes, the CPT system focuses more on procedures. Both sets are now required on most Medicare claims. The ICD-9 codes identify the diagnoses, while the CPT codes identify the treatment necessary for those diagnoses. If these codes are not compatible, the insurance claim will not be reimbursed.

In summary, documentation in patient records must be thorough and complete and include all pertinent diagnoses and rationale behind the diagnoses. Coders must also be able to read all of the records and not have to try and find missing records or interpret sloppy handwriting. Intentionally falsifying codes in order to increase reimbursements from insurance companies is illegal and must be avoided at all costs. While these coding systems may seem complicated in their usage, with the proper education and communication between staff, health care providers and coders, this system will allow for proper reimbursement of services rendered.

About The Author

Veronica Castellana Veronica Castellana

RN MARKET News features Legal Nurse Consulting related articles written by Veronica Castellana, Ryan Sanchez, and other guest writers. Veronica is the LNC STAT course creator and is a currently practicing Advanced Legal Nurse Consultant. Her training tools and techniques have resulted in some of the most succesful Legal Nurse Consultants in the world. She is now the leader in Legal Nurse success. Ryan is the Director of Marketing for RN MARKET and the LNC STAT course. His valuable expertise helps nurses to realize their true potential and value in the field of Legal Nurse Consulting.