Study confirms: Even experts confused by Medicare coding

Specialized coding agencies can't agree on proper E&M codes.

By Markian Hawryluk, amednews staff. Sept. 16, 2002.

Washington -- A new study bolsters what many physicians have claimed for years -- Medicare's evaluation and management coding process is horribly confusing.

Researchers from the Dept. of Emergency Medicine at the William Beaumont Hospital System in Royal Oak, Mich., set out to determine how well even experts could do in appropriately coding emergency department visits.

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The study, published in the September issue of Annals of Emergency Medicine, looked at the five E&M codes that represent 70% of the codes emergency physicians use to bill for their services.

The researchers, led by Raymond Jackson, MD, sent copies of 389 medical records to four private coding firms and asked them to correctly assign codes to the emergency department visits documented in the charts. They found little consensus.

The agencies agreed on the proper coding in only 15% of the charts. In 6%, the four coding firms came up with four different codes. And in 29% of the records, the coders disagreed by more than two code levels.

The study also compared the coding decisions made by four coders within the same coding agency. The results were only slightly better.

Agencies agreed on the proper coding in only 15% of the charts.

"We wonder whether an individual coder would code the same record similarly over time," the researchers said.

The researchers suggested improving the coding system by creating templates that would direct doctors toward more consistent documentation. They also suggested a more rigorous formatting of dictations to produce more consistent documentation and clearer and more explicit guidelines to explain the differences between E&M coding levels.

For physicians, the coding morass is more than just an issue of frustration. Because E&M codes account for about $18 billion in Medicare payments each year, investigators from the Dept. of Health and Human Services' Office of the Inspector General have been focusing on improper use of E&M coding in their antifraud efforts.

The hospital's study seems to support physicians' claims that many cases of improper coding result from the confusion surrounding E&M codes, rather than an effort to defraud the government.

"The truth is that most of what the government calls fraud and abuse results from simple billing errors and the problems inherent in complying with Medicare's more than 100,000 pages of rules and supporting documents," said Michael Carius, MD, president of the American College of Emergency Physicians.

According to Brent Asplin, MD, an emergency physician from the Regions Hospital and HealthPartners Research Foundation in St. Paul, Minn., the study shows that E&M coding methods are not reliable enough to be the basis for antifraud efforts.

"This study is similar to the famous tax test that Money magazine conducted a couple of years ago," Dr. Asplin said. "Money sent a hypothetical family's tax return to 46 different tax preparers and got back 46 different answers. Dr. Jackson's team finds that the Medicare coding system is just as prone to inconsistency and disagreement, even when specialists are put to the task."

Physicians under pressure

In an editorial in the same journal, Dr. Asplin said the increased focus on fraud prevention, and the threat of severe penalties such as exclusion from Medicare, has led many physicians to purposely undercode. While estimates of improper overpayments to Medicare practitioners have dropped from $23 billion in 1996 to $12.6 billion in 1998, there is no reliable estimate of the amount of money Medicare has saved because of doctor undercoding, he said.

The increase in fines, settlements and recovered payments from federal antifraud efforts bodes well for the Medicare trust fund, but the news for physicians is not as good.

Medicare has more than 100,000 pages of rules and supporting documents.

"The combination of escalating costs for providing services, falling Medicare reimbursements, rapidly changing reimbursement regulations and the threat of criminal investigations for coding errors creates a 'Catch-22' climate," Dr. Asplin said.

He said physicians shouldn't get their hopes up that the problem will go away. The budgetary climate will ensure that the OIG will continue its efforts. Instead, physicians should focus on working with the agency and Congress to point out where regulations are unclear or unreliable -- such as the E&M guidelines, he said.

Earlier this year, the HHS Advisory Committee on Regulatory Reform recommended that the government scrap the current E&M documentation guidelines.

This fall, the CPT Editorial Panel E&M work group will release proposed changes to E&M coding. That plan is expected to leave emergency department codes basically unchanged. But the proposal will include clinical examples or vignettes, drawn from each specialty, to help doctors recognize how to appropriately code for E&M services.

ADDITIONAL INFORMATION:

Code confusion

A new study shows that even specialized coding firms looking at the same set of medical records couldn't agree on the proper Medicare evaluation and management codes more than 15% of the time.

All four firms agreed: 15%
Three firms agreed: 42%
Two firms agreed: 37%
No agreement: 6%

Source: Annals of Emergency Medicine, September

Weblink

Article, "Reliability of assigning correct current procedural terminology -- 4 E/M codes," Annals of Emergency Medicine, September (volume 40, issue 3)

Article, "E/M coding and the OIG: Not so reliable after all," editorial, Annals of Emergency Medicine, September (volume 40, issue 3)

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