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Code breakers: The importance of unlocking Medicare code

Good coders can find overlooked revenue. Where do you find them? You can train someone, hire one to work in your office or outsource to someone coding from home.

By Robert Kazel, amednews staff. June 30, 2003.

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Oh, what a difference a digit makes.

Sandra Clement, the office manager of a small surgical practice in Rockport, Maine, often coded bills for the replacement of pacemakers. For years, when doctors at her office changed the pacemaker for a Medicare patient, she entered the billing code as 33213 -- the Medicare designation for insertion of a pacemaker pulse generator. The practice received about $400 per procedure.

But then Clement, who had been doing billing for the group for 27 years, attended a 15-week course on coding, and earned the rank of certified professional coder. In the process, she mined some coding gold nuggets -- such as how and when to use Medicare code 33233, for removal of a pacemaker. Billing the two codes together for both halves of the procedure, she was taught, could approximately double her doctors' reimbursement.

Clement contacted Medicare and refiled for a dozen undercoded pacemaker procedures, bringing in about $5,000. That repaid the practice for what it had spent on her coding course, and then some. "The doctors were quite happy," Clement recalls. "It was just something that escaped our practice."

With that kind of money at stake, and the liability for everything a coder transmits to payers, more doctors are realizing that coding can be complex enough to require assistance, those in the coding industry say.

Small changes in procedural or diagnostic codes, unearthed by an educated and attentive coder, can be key to unlocking sources of money doctors overlook. Some experts estimate that a typical family practice may lose between 10% and 20% of its potential income because of poor coding practices. Data published by the Journal of Family Practice suggests that family physicians undercode or overcode almost half of the time.

A coder who is well-trained also may be more likely to be confident in filing appeals with HMOs when claims are challenged by HMO bureaucrats, physicians and others say. But finding professional coders is easier said than done. About 18% of coding jobs in health care are unfilled because doctors and hospitals can't find coders with strong enough backgrounds and skills.

So physicians have three choices: Outsource the task to a professional coding firm, many of which employ part-time, stay-at-home workers; get their present employees trained as coders; or beat the bushes to hire someone new.

If doctors want to hire a new staff coder, they'll have to decide whether the coder should work inside the office or have work completed from an outside location, with the coder gathering charts either in person, by fax or via the Internet.

Because of the Internet, many coders in the past few years have found it convenient to arrange to work out of their homes, and pajama-clad, part-time coders situated at dining-room tables in front of personal computers are no longer uncommon.

Sometimes arrangements are more formal: So-called "remote coding" businesses are forming that employ scores of coders, frequently working from homes all over the country and inputting codes into the company's central computer.

"With [Web] technology in place, coding services can be done more accurately and cost effectively than with traditional coding methods," says Dave Jensen, CEO of Salt Lake City-based Aviacode, which employs about 45 full-time certified coders and which serves about 500 doctors. Aviacode's level of revenue and number of clients have quadrupled in the past six months, Jensen says.

Practices using Aviacode are spending an average of $6,000 to $15,000 a year per full-time physician for coding services, he says.

The firm charges a piece rate -- for example, $2 to $2.50 per chart for an office visit and $6 to $10 per chart for surgeries.

Because most physicians tend to undercode more often than overcode, most Aviacode's clients report eventual gains in reimbursements that range from 3% to 50%, Jensen says.

Some practices find such arrangements preferable because the coder may work more quickly and efficiently outside of the tumult of an office, and if coders are outside employees, a practice can often save money by not paying them benefits.

But other coding experts say the disadvantage of such an arrangement is that coders are not easily accessible to discuss charts with physicians, if necessary. Also, they said, a feeling of trust between the physician and coder is more likely to develop if they work together in the same office.

If doctors do hire remote coding firms that receive and send data electronically, they will probably want to consult an attorney to make sure the arrangement complies with HIPAA privacy standards.

In Aviacode's case, Jensen says, chart information sent over the Internet is extensively encrypted, and patients' names are even removed from charts before coders receive them. The firm's coders also are required to sign privacy oaths.

Go with who you know

Great potential coders may be under your nose, at work right now.

Lorne Direnfeld, MD, a neurologist in Maui, Hawaii, swears by the value of turning office staff into top-notch coders to boost both professionalism and reimbursement levels.

Dr. Direnfeld, formerly the medical director of a small multispecialty practice in Maui, got disgusted with downcoding by managed care companies during the late 1990s and mounted a strategic defense: He began sending several of his business staff to twice-weekly, evening coding classes at a community college.

Payers "were often wrong, and the only way I could fend off this downcoding problem was to train my staff to a higher level," he says.

The staff's course work paid off in "significant savings" to the doctors, mainly because billing staff learned just how frequently the practice had been undercoding evaluation and management visits out of needless conservatism, Dr. Direnfeld says.

"I strongly encourage doctors to send their valued employees for more training," he says. "The life of your practice depends on your cash flow. Having someone represent your side when dealing with insurance companies is essential."

But if you do send off an employee to be trained, the expectation likely will be that you'll be footing the bill, as Dr. Direnfeld and Clement's surgical practice did.

There are fairly short classes designed by medical associations, full-fledged certificate or degree programs at community colleges, and even online, self-paced programs offered by coding societies.

There are also on-site programs where a coding consulting firm can actually come to the practice and teach there.

Or there are technical colleges that offer year-long diploma programs. Those can cost hundreds or thousands of dollars.

There are far cheaper deals, too -- many one-day intensive workshops and brush-up sessions are available for billing staff and doctors, but they don't cover as much ground.

Once employees are trained, their pay likely will have to be bumped up to reflect their added skills.

Find a professional

If a practice wants to hire a staff coder itself, a credentialed and experienced professional probably won't come cheaply. Strong competition for coders has driven up their pay, and experienced coders at medical practices now earn about $30,300 on average, according to a survey by the American Academy of Professional Coders.

Pay varies widely according to region, the coder's background and overall job responsibilities. Those coding with the title of office manager, for example, earn an average salary exceeding $39,000, the survey found.

The sophistication of training also matters: Certified professional coders, who have taken an AAPC-approved coding course and passed the society's five-hour, 150-question, open-book exam, earn $6,000 more per year on average than those coders who haven't.

Most coders are not certified, but hiring coders with certification is worth the search and the expense, says Clare Bailey, marketing director of the AAPC. "A coder is essential to the doctor for the highest reimbursement possible. A good coder can make all the difference in his practice."

Of course, many coders may have sufficient skills without being certified.

"You can train people to learn these rules, to pass a certification test, but I would be more concerned with their understanding of clinical procedures," says C.J. Wolf, MD, manager of ambulatory coding and reimbursement for Intermountain Health Care in Salt Lake City and a certified coder. "I really need to get into their brain. I see CPCs [certified professional coders] all the time, but I need to see what they really know."

One way to learn if prospective coders can handle the job, Dr. Wolf says, is to find out if they can do coding on the spot. Present a candidate with actual claims that were denied by payers, ask them to analyze the coding that was done and ask what they would have done differently.

Beyond coding expertise, doctors should look for personal qualities found in the best coders: analytical, detail-oriented minds; self-confidence; and a willingness to play on the team by being flexible and reasonable in their discussion of codes with doctors and other employees. Also, coders should understand that because the physicians' names are on the charts, they have the last word.

"Coding is not black and white, it is very gray," says Laurie Desjardines, a coding consultant at the New Hampshire Medical Society. "Sometimes you have to agree to disagree, and a coder who is rigid just won't make it."

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