What’s in a Diagnosis Code?

Some payers will take back the fee-for-service payment if the wrong diagnosis code is selected.

There have been many conversations had since the healthcare industry moved to ICD-10-CM, and many more guidelines developed regarding when to query a physician, which has sparked even more debate.

Guideline 19 in ICD-10-CM states:

“The assignment of a diagnosis code is based on the provider’s diagnostic statement that the condition exists. The provider’s statement that the patient has a particular condition is sufficient. Code assignment is not based on clinical criteria used by the provider to establish the diagnosis.”

But, in fact, the U.S. Department of Health and Human Services (HHS) Office of Inspector General (OIG) has weighed in on the importance of provider documentation through risk adjustment programs. The italicized excerpts below indicate their review and ongoing work of hierarchical condition category (HCC) coding for Medicare Advantage programs:

From a provider standpoint, we have taken a backseat, being as in most situations regarding risk adjustment coding, our best opportunity for receiving a piece of the pie has been charging for compiling our medical records for review by the managed care associations; remember, we still mainly receive our reimbursements from fee-for-service functions.

So it begs the question, from a provider standpoint, what is in a diagnosis code? We know that we need the right ones in order to get services or procedures approved. We know that the use of them will help us meet certain quality measures. Theoretically, we understand the importance of tying them to the patient journey, and documenting appropriately for compliance, helping establish medical necessity.

What most of us didn’t realize (and now are starting to realize) through contract review and denials or takebacks is that certain health plans are starting to change the language in provider contracts, giving themselves the right to take back the provider’s fee-for-service payment if they select the wrong diagnosis code.

That’s right: if you choose the wrong code, and it happened to hit a risk adjustment model code, and upon audit, your documentation does not hit that level of specificity sought for the condition, you forgo your payment. One contract goes on to say that you also must agree to their proprietary bundling software (you don’t get access to it), and no appeal rights are afforded.

As the language in provider contracts continues to get updated, this issue will continue to grow in importance. Once again, it’s important to not place a lot of value on Guideline 19. It’s important to query providers in the absence of documentation when those codes can influence further payments, outside of fee-for-service functions. It’s important that your documentation reaches the level of specificity found in the code.

Clinical documentation improvement and awareness of the risk adjustment models are extremely important for us, as we move forward. Now is the time to review your documentation to make sure it is robust enough to withstand an audit.

Programming Note:

Listen to Rhonda Buckholtz report this story live during Talk Ten Tuesday today, 10-10:30 a.m. EST.