Automated claim coding pays off in time and money

Human beings no longer code most of the claims sent out by Florida Radiology Associates in Orlando, and executive director Charles May seems mighty pleased about it.

With his implementation of automated medical coding, May has seen a 63% decrease in claims rejected for "medical necessity" problems. Revenue per claim has also increased by an average of 87Β’, which adds up nicely when you send out more than 500,000 claims per year.

"Even though we have a lot of transactions going through it on a regular basis each month, we have just been amazed at the improvement in our system," said May in a presentation at 2004 American Healthcare Radiology Administrators (AHRA) Electronic Imaging conference in Lake Tahoe, NV.

Although other vendors offer automated medical coding, May spoke specifically about his experience with services supplied by A-Life Medical of San Diego.

The company's software uses natural-language programming to "read" dictated reports by breaking the text down into its components -- much like the process of diagramming sentences in grammar school, according to Tim Minnich, A-Life's national sales manager.

While the billing side of a practice may seem mundane compared to the medical side, there's no question that it is vital. Unfortunately, getting paid for services includes mastering the use of thousands of ICD (International Classification of Diseases) and CPT (Current Procedural Terminology) codes.

"We found that if I took five coders and gave them all the same (physician's) report, the likelihood is I will get at least two different ICD-9 codes from what they're looking at, and maybe as many as three," May stated.

The consistency achievable with computer software, on the other hand, may be responsible for some of the recent improvement, May suggested.

The 47 radiologists of Florida Radiology Associates provide imaging services to the seven facilities in the Florida Hospital Health System, and perform more than 800,000 reads/procedures per year.

The FHHS hospital information system (HIS) had previously been set up to provide FRA with electronically transmitted radiology reports, radiology department charges, and patient information. But that's just the starting point for generating a bill for the related professional charges, May noted.

In the past, all dictation reports would be accessed and read by certified coders, who would then type information into the group's billing software to generate a claim. Each coder would be able to generate between 275 and 325 claims per day, May said.

But given the volume of reports and the difficulty in finding good coding staff, the group was perpetually up against 30-day deadlines for timely billing.

The process has now changed dramatically, as the hospital charges, dictation, and demographic data is now pulled together by computer and then sent out for automated coding.

On any given Monday, the HIS sends over data on the thousands of charges generated on the previous Friday and over the weekend. "Instead of those 11,000 charges all going into this holding area and everybody looking at them for the next 30 days, within 72 hours those charges are going out the door to the payor," May said.

Getting bills out the door faster has also cut 12 days off the group's accounts receivable lag, May said.

The automated system may also be a godsend if the HIS experiences a major glitch, like the time when some $2.3 million in radiology charges disappeared from the system. "Had I had the electronic coding software (then), with 99% of the information I needed to create a charge coming from the report itself, I would have saved a lot of time and money," May stated.

But moving to automated coding also involved difficult challenges, he said. A number of preparatory tasks had to be completed prior to implementation, which required marshaling and reassuring the billing staff who did the work.

In addition, it took about three months to bring the radiologists' dictation in line with the requirements of the new system. "Most of them have a way they dictate reports and have no desire to change anything," noted May.

The group's compliance manager, Renee Vrtikapa, used the software to show radiologists how their words would make a difference for the bottom line. For example, if the dictation for a CT angiography specifically noted that intravenous contrast was used --  and reformatted images were obtained -- rather than just referring to "normal CTA protocol," the software could then highlight the text that entitles the group to an extra $17 in Medicare reimbursement per exam.

Of course, the automated coding also comes at a cost, a per-transaction fee in this case. A contractual agreement precluded May from disclosing the fee, but he joked about how much the vendor must appreciate FRA's business.

May runs up a big bill by putting as many charges as possible through the automated system. Some claims remain too complex for automatic coding, however, especially those for interventional radiology.

Yet today the Florida group has only three coders on staff, having had as many as nine in the past. "Day to day, they're caught up," May said, adding that the staff also now has time to research more complicated reimbursement problems.

Not only is May saving money on salaries and benefits, he’s particularly enthusiastic about reducing his backlog of hard-to-fill positions.

May recently learned that the Florida Hospital Health System plans to add 555 more beds in the future, which means he will have to recruit more radiologists. "But you know," he said, "one good thing: I don't need one damn certified coder."

By Tracie L. Thompson staff writer
May 11, 2004

Related Reading

Billing mistakes cost Medicare $11.6 billion, U.S. says, November 17, 2003

Part I: Coding and reimbursement tips and traps for radiology, October 30, 2003

Demystifying the internal auditing program, October 16, 2002

Do you know who is minding the codes? March 27, 2002

Necessity criteria compliance critical for PET reimbursement, February 28, 2002

Copyright Β© 2004

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