Add Charge Capture Review to CDM Coding Updates in Q1
The first few months of the calendar year bring significant chargemaster (CDM) maintenance and review. This includes things like new coding and payment rules, new CPT/HCPCS codes, and the deletion of other CPT and HCPCS codes. It's an incredibly busy part of the calendar that has many competing priorities. It might not seem like the ideal time of year to undergo a charge capture review, but it may surprise you that the opposite can be true.
The CDM data being updated during the first quarter comprises much of the same data that populates a charge capture review. A charge capture review following CDM updates can provide a quick accuracy check of the updates. It's a rare opportunity to accomplish two things at once.
Continual Charge or Pricing Review Works Best
In the not-so-distant past, many hospitals would undergo pricing changes at the end of the year or in the first quarter of the current year. It was generally based on information from Finance and seldom included comparative pricing strategies. With the advent of price transparency, maintaining community-sensitive pricing is a must. Pricing should take a center stage position within your CDM reviews. Ongoing pricing review at regular intervals is becoming best practice and a solution that can help with the CDM review, maintenance, and pricing becomes invaluable.
Charge Capture Basics
Charge capture is the process medical facilities and professionals use to complete the billing process and assure the facility gets paid what it has compliantly earned. Information is captured and recorded about services performed and supplies used. It is then coded appropriately for distinct insurance companies who reimburse in accord with regulations and their distinct payor-specific requirements.
There are five key parts to the charge capture process:
Documentation → Chargemaster → Charge Capture → Charge Reconciliation → Reimbursement
First is the all-important documentation step on the clinical side. Physicians, and other medical staff, document clinical information related to the encounter. These include orders complete with medical necessity and enough definition that the coding professionals can select the correct CPT/HCPCS for the procedure.
Then we have the chargemaster itself – an inventory of all services, procedures, supplies, and pharmaceuticals that may be provided during patient care. The chargemaster is the master authority of this data, yet it is not a static object. It is dynamic, with procedures, drugs, regulations, and codes that are constantly changing.
The next part, specific charge capture, is a fairly standardized procedure of medical coding and billing. Trained staff input established ‘clinical’ CPT and HCPCS codes into a billing system.
Then comes charge reconciliation, which is the act of comparing charges generated to services provided to ensure accuracy. Many believe reconciliation is best done daily, along with sporadic reviews. And again, software solutions can help staff streamline this process.
And finally, reimbursement. Put most simply, this is the act of receiving payment for sent claims or invoices.
Charge Capture Review Solves Nagging Problems
The review is an overall evaluation comprised of three steps:
- Monitor and audit the charge capture processes
- Investigate the root causes of any variances, such as missing or incorrect charges
- Remediation, to resolve issues and prevent them from happening again
The review process may seem like a constant battle — you “plug a leak” in one spot and another springs open somewhere else. It takes your whole revenue team, plus a continuous process of educating clinical staff, to make charge capture an ongoing, efficient process. The good news, the more often your team completes a review, the simpler it becomes.
In brief, there are five major categories that all charges align under:
- Procedures — most often 10,000 – 69,999 CPT codes
- Services — lab, radiology, medical procedures, E/M, CPT 70,000 – 99,xxx
- Pharmacy — generally 250, 255, 636, J codes, and 637 revenue codes
- Supplies — typically, a HCPCS code or revenue code 27x
- Inpatient Room and Board — as designated by room type revenue code
The basic steps of the review can focus on various aspects of the data, and/or the overall function and efficacy of the various teams doing billing services. In other words, a good, comprehensive charge capture review will cover both the data aspects of the above categories and the processes (or workflow) that capture the services performed in those categories.
First Quarter is An Especially Good Time to Review
It makes sense to begin charge capture reviews at the beginning of the year since many first-quarter CDM updates affect the same data as in the above categories. A review can help ensure a facility’s recent updates are implemented correctly and matched up appropriately within the CDM, right from the start.
Data that is typically part of first-quarter CDM updates and charge capture review includes:
- Prices for DRG (diagnosis-related group) to comply with new, current CMS (Centers for Medicare & Medicaid Services) mandates
- HCPCS additions and deletions
- HCPCS description changes
- CMS or AMA corrections since latest data releases
- Regulatory and payment system updates
- Reimbursement changes
- Alternate payor updates for the new year
- 2021 is likely to bring many new COVID-19-related codes, as well
We believe you can kill two birds with one stone with the right planning and tools. Here are directions on how to design your own hospital charge capture audit. If you need further help, we are at the ready.