Physician Documentation &
Billing
IMPACT ON HOSPITAL
REVENUE
Trends in Healthcare
•
H O S P I TA L S H AV E B E E N A C Q U I R I N G P H Y S I C I A N
PRACTICES.
•
H O S P I TA L S H AV E B E E N E S TA B L I S H I N G J O I N T
VENTURES WITH PHYSICIANS.
•
H O S P I TA L S H AV E B E E N F O R M I N G A F F I L I AT I O N S
WITH PHYSICIANS
Hospital – Physician Affiliations
The Effect on the Hospital
Revenue Cycle
•
P H Y S I C I A N B I L L I N G S F R O M A F F I L I AT E D
P R A C T I C E S N O W I M PA C T H O S P I TA L R E V E N U E .
•
PHYSICIAN BILLING ERRORS CAN NOW
C R E AT E C O M P L I A N C E I S S U E S F O R T H E
PA R E N T H O S P I TA L .
•
RAC AUDITORS ARE NOW FOCUSING ON E/M
BILLINGS
WHY YOU SHOULD BE CONCERNED
Reason #1
Medicare Carrier Finds 50-90% Error Rate for E/M Codes
Written by Leigh Page | February 22, 2011
Tags: claims | error rates | Medicare | Part B
A random survey of claims by the Medicare Part B carrier in five states has
uncovered average error rates of 50-90 percent for E/M codes, according to a
report by Part B News.
TrailBlazer, the carrier in Colorado, New Mexico, Oklahoma, Texas and Virginia,
said the most common cause was "documentation errors." TrailBlazer also cited
some obvious errors, such as the reason for encounter was to receive lab results,
which doesn't count as an E/M and also some not so obvious ones, such as that
the frequency of E/Ms billed per beneficiary exceeded documented needs for
management of stable, chronic conditions.
"I could see maybe 20 percent (error rate) or a little higher. But 90 percent I just
haven't seen before," said Seth Canterbury, an education specialist for the
University of Florida Jacksonville Physicians.
OUR EXPERIENCE IN AUDITING THE DOCUMENTATION AND
BILLING RECORDS FOR OVER 200 PHYSICIANS
 WE HAVE SEEN AVERAGE ERROR RATES BETWEEN 35%
AND 70% WITH SOME MUCH HIGHER.
 WE FOUND BOTH UNDER CHARGED AND OVER CHARGED
ERRORS.
 MOST ERRORS WERE CAUSED BY POOR OR INADEQUATE
DOCUMENTATION BY THE PHYSICIANS.
DOCUMENTATION??
WHY YOU SHOULD BE CONCERNED
Reason #2
RACs Expand into Physician Practices, Adding Pressure to
Existing Audit Burden
Written by Lori Brocato | Thursday, December 20, 2012
HDI and Connolly Make First Strides
Two RACs recently mentioned upcoming reviews of physician
practices and medical groups. One is taking a generic approach, while
the other will hone in on specific issues sorted by provider type.
Regardless of the methodology used, however, we predict that other
RACs will follow suit.
WHAT YOU CAN DO:
1.
Install sophisticated electronic medical documentation
and billing systems in all affiliated physicians’ offices.
(Can be expensive and will be effective only if physicians properly use it)
2.
Hire medical scribes to assist each affiliated physician.
(Very expensive and depends on the training of the scribes)
3.
Teach the physicians to properly document and correctly
bill for services.
(A reasonably priced alternative that will be effective with most physicians)
TYPICAL DOCUMENTATION
FROM ELECTRONIC MEDICAL
RECORD SYSTEM
E & M BILLING
 THE OVERWHELMING MAJORITY OF PHYSICIAN BILLING IS FOR
EVALUATION AND MANAGEMENT (E & M) SERVICES.
 THERE ARE CLEARLY DEFINED PROTOCOLS FOR THE PROPER
DOCUMENTATION AND CORRECT BILLING OF E & M SERVICES.
 THERE ARE PUBLISHED AUDIT GUIDELINES FOR ESTABLISHING
THE ACCURACY OF E & M BILLING.
 YET MANY PHYSICIANS ARE UNAWARE OF THESE PROTOCOLS
AND GUIDELINES.
EVALUATION & MANAGEMENT PROCESS
E&M
Encounter
Take Patient
History
Document
History
Perform
Examination
Document
Exam
Make Clinical
Decision
Document
Decision
Making
Code & Bill
E & M Documentation
Clear and concise medical
documentation is required to provide
patients with quality care, and is critical
to receive accurate and timely payment.
It is also necessary to ensure that a
service is consistent with the patient’s
insurance coverage and to validate the
following:
The medical necessity and appropriateness of
the diagnostic or therapeutic services provided
 The site of service
 That services furnished have been accurately
reported

E & M General Principles
The documentation of each patient encounter should be
legible and include:
•Reason for the encounter and relevant history, physical
examination findings, and prior diagnostic test results
•Assessment, clinical impression, or diagnosis
•Medical plan of care
•Date and legible identity of the observer
Defining the levels of E & M services
Key components:
I.
Patient History
II. Examination
III. Medical decision making
Contributory components
• Nature of presenting problem
• Time
• Counseling
• Coordination of care
PATIENT HISTORY
History includes some or all of the following elements:
 Chief Complaint (CC) is required for any level of service and validates the
medical necessity of the service.

It should be a concise statement describing the symptoms, problem, condition,
diagnosis, physician recommended return, or other factor that is the reason for the
encounter. It is usually stated in the patient’s own words.
 History of present Illness (HPI) or Status of Chronic Conditions is
required for any level of service and Must be documented by the MD.
 Review of Systems (ROS)*
 Past Family and/or Social History (PFSH)*
*Must include Physician Notation, MD signature and date
The extent of the history documented should depend on the nature of the problem
HISTORY DOCUMENTATION SUMMARY
Type of History
History of Present
Illness
(HPI)
Review of Systems
(ROS)
Past Family and/or
Social History
(PFSH)
Problem Focused
(PF)
Brief
1 – 3 elements
N/A
N/A
Expanded Problem
Focused
(EPF)
Brief
1 – 3 elements
Problem Pertinent
1 system
N/A
Detailed
(D)
Extended
4+ elements
Extended
2 – 9 systems
Pertinent
1 area
Comprehensive
(C)
Extended
4+ elements
Complete
9+ systems
Complete
3 areas
PHYSICAL EXAMINATION
The extent of examinations performed and
documented is dependent upon clinical
judgment and the nature of the presenting
problem. They range from limited
examinations of single body areas to general
multi-system or complete single-organ
system examinations.
PHYSICAL EXAMINATION DOCUMENTATION
The body areas:
• Head, including face
• Back, including spine
• Chest including breasts
and axillae
• Abdomen
• Neck
• Genitalia, groin, buttocks
• Each extremity
The organ systems:
• Constitutional
• Eyes
• Ears, nose, mouth, throat
• Cardiovascular
• Respiratory
• GI
• GU
• Musculoskeletal
• Neurological
• Skin
• Psychiatric
• Hem/lymph/imm
4 LEVELS OF EXAMINATION - CPT
 Problem Focused (PF): a limited examination of the
affected body area or organ system.
 Expanded Problem Focused (EPF): a limited examination
of the affected body area or organ system and other
symptomatic or related organ systems.
 Detailed (D): an extended examination of the affected body
area and other symptomatic or related organ systems.
 Comprehensive (C): a general multi-system examination or
complete examination of a single organ system.
MEDICAL DECISION MAKING
Medical decision making refers to the complexity of establishing a
diagnosis and/or selecting a management option, determined by
considering the following factors:
1. Number of possible diagnoses and/or number of management
options considered;
2. Amount and/or complexity of medical records, diagnostic tests,
and/or other information that must be obtained, reviewed, and
analyzed;
3. Risk of significant complications, morbidity and/or mortality as
well as comorbidities associated with the patient’s presenting
problems, diagnostic procedures, and/or possible management
options.
To qualify for a given type of medical decision
making, two of the three above elements must be met
or exceeded.
MEDICAL DECISION MAKING
SCORING FOR COMPLEXITY
A
Number of
diagnoses and
treatment options
B
Amount and
Complexity of
Data
1
Minimal/Low
2
Limited
3
Multiple
4
Extensive
C
Highest Risk
Minimal
Low
Moderate
High
Type of Decision
Making
Straight
forward
Low
Complexity
Moderate
Complexity
High
Complexity
1
Minimal
2
Limited
3
Moderate
4
Extensive
If no column contains more than one entry, choose “Low Complexity”
BILLING E&M SERVICES
 When billing for patient visits, select the codes
that best represent the services furnished during
the visit.
 It is the provider’s responsibility to ensure that
the submitted claim accurately reflects the
service provided.
 Do not use the volume of documentation to
determine which specific level of service to bill.
 In order to receive payment from Medicare, the
service must also be considered reasonable and
necessary.
New Patient Office Visit (All 3 key components met or exceeded)
Level
History
Exam
Medical
Decision
99201
Problem
Focused

Chief Complaint
 Brief history of present illness
(1 – 3 HPI elements)

Exam of affected body area/organ system (1995
guidelines – At least 1 system with 1 element or 1
comment)
Straight-forward
99202
Expanded
Problem
Focused

Chief Complaint
 brief Hx of present illness (1 – 3
HPI)
 Problem pertinent system review
(1 ROS)

Exam of affected body area/organ system
 Exam of other symptomatic or related body
area/organ system (At least 2 systems with at
least 1 element or 1 comment)
Straight-forward
99203
Detailed

Chief complaint
 Extended HPI (4 or more
elements)
 Extended system review (2 – 9
ROS)
 One pertinent PFSH

99204
Complete

Chief complaint
 Extended HPI (4+ elem)
 Complete ROS (10+)
 Complete PFSH (all 3)
Complete
99205
Complex or
Severe

Chief complaint
 Extended HPI (4+ elem)
 Complete ROS (10+)
 Complete PFSH (all 3)

Extended exam of affected body area/organ
system
 Extended exam of other symptomatic or related
body area/organ system
(At least 4 systems with at least 4 elements or 4
comments - 4 X 4 rule)
Low
single system specialty exam
or
Complete multi-system exam (1995 guidelines –
at least 9 systems with 1 element or 1 comment)
Moderate
complexity
Complete single system specialty exam
or
 Complete multi-system exam (1995 guidelines –
same as Level 4 above)
High complexity
Established Patient Office Visit (2 key components met or exceeded)
Level
99211
Problem
Focused
History
Exam
Does not require presence of a
physician
Presenting problems are minimal
99212
Expanded
Problem
Focused

Chief Complaint
 Brief history of present illness (1
– 3 elements)

99213
Detailed

Chief complaint
 Brief history of present illness (1 3 elements)
 Problem pertinent system review
(1 ROS)

99214
Complete

Chief complaint
 Extended HPI (4+ elements)
 Extended ROS (2 – 9 ROS)
 Pertinent PFSH (1 PFSH)

99215
Complex or
Severe

Chief complaint
 Extended HPI (4+ elements)
 Complete ROS (10+ ROS)
 Complete PFSH (2 of 3 PFSH for
complete)

Medical
Decision
Exam of affected body area/organ system
(1995 guidelines – At least 1 system with 1 element
or 1 comment)
Straight-forward
Exam of affected body area/organ system
Exam of other symptomatic or related body
area/organ system (At least 2 systems with at least
1 element or 1 comment)
Low
Detailed exam (At least 4 systems with at least 4
elements or 4 comments – 4X4 rule)
Moderate
complexity
Complete single system specialty exam
or
 Complete multi-system exam (1995 guidelines –
at least 8 systems with 1 element or 1 comment)
High complexity
Evaluating E & M
Documentation
How others will judge
The quality of your
Documentation
1. The patient history
2. The Exam
3. The complexity of
your decision making
Copy of the Marshfield Clinic
Audit Worksheet commonly used
To evaluate E & M documentation
THE TRAINING APPROACH
 Electronic medical documentation
and the use of scribes can be
effective methods to reduce the
problem of physician billing errors,
but they are expensive to install
and maintain.
 Physician documentation/billing
training is a less-expensive
alternative that can produce
significant documentation
improvements, increased revenue
and reduced risk of compliance
errors and RAC vulnerability.
PHYSICIAN TRAINING
I.
Group training for Physicians and practice support
staff.
II. Sample audits of the billings and documentation
for each Physician.
III. One-on-one training with each physician.
IV. Remedial follow-up audits and training at regular
intervals.
I. GROUP TRAINING
All physicians, billers and support staff attend a 2 – 4 hour training
session covering the following:
A. A detailed explanation of how to correctly document an E & M
encounter with relevant examples.
B. Instruction on standard billing protocol and proper selection of
the appropriate E & M code.
C. Introduction to the standard audit worksheet used by outside
auditors to evaluate the quality of the physician documentation
and the accuracy of the billing.
II. AUDIT OF SAMPLE BILLINGS
 A sample of 20 to 30 E & M bills are
randomly selected for each physician.
 Each bill is carefully audited, using standard
audit protocols, to confirm the accuracy of
the bill and the completeness of the
documentation
 Every error and inadequacy is clearly
explained with indication of the correct or
more appropriate choice.
 A report is prepared outlining the accuracy
and completeness of the billings for each
physician.
III. ONE-ON-ONE PHYSICIAN TRAINING
 A qualified trainer meets with each physician for an
individual one-hour post-audit training session.
 The audit report is presented and explained so the
physician clearly understands every error or
inadequacy and the correct way to document and
bill.
SAMPLE OF ACTUAL AUDIT RESULTS
M. LECO & ASSOCIATES
ABC MEDICAL PRACTICE
PROVIDER E/M AUDIT RESULTS SUMMARY
Provider
DR. A
DR. B
DR. C
DR. D
DR. E
DR. F
DR. G
DR. H
DR. I
DR. J
DR. K
DR. L
DR. M
DR. N
DR. O
DR. P
DR. Q
DR. R
DR. S
TOTALS
Audit Date
10/3/2012
10/4/2012
10/31/2012
10/31/2012
10/23/2012
11/7/2012
10/22/2012
11/7/2012
11/7/2012
11/7/2012
10/31/2012
11/7/2012
12/18/2012
11/29/2012
12/19/2012
12/18/2012
12/19/2012
11/30/2012
12/4/2012
Post Audit Final Report
Interview
10/8/2012 10/10/2012
10/18/2012 10/29/2012
11/15/2012 11/19/2012
11/15/2012 11/19/2012
11/15/2012 11/19/2012
12/13/2012 12/14/2012
12/13/2012 12/14/2012
12/13/2012 12/14/2012
12/19/2012 12/20/2012
12/19/2012 12/19/2012
12/19/2012 12/20/2012
12/21/2012 12/21/2012
1/5/2013
1/7/2013
1/8/2013
1/9/2013
1/8/2013
1/9/2013
1/9/2013
1/9/2013
1/10/2013
1/15/2013
1/11/2013
1/15/2013
1/17/2013
1/18/2013
Under
Over
Correct
Total
Coded
Coded
Audited
15
2
5
22
7
3
10
20
3
0
17
20
5
0
15
20
0
9
6
15
1
0
19
20
4
2
14
20
6
1
13
20
8
0
12
20
5
0
15
20
6
1
12
19
3
0
17
20
6
1
13
20
0
6
14
20
11
2
7
20
0
4
16
20
14
0
6
20
7
0
13
20
3
0
17
20
104
31
241
Typical report presented along with narrative to management staff
376
Error
Rate
77.3%
50.0%
15.0%
25.0%
60.0%
5.0%
30.0%
35.0%
40.0%
25.0%
36.8%
15.0%
35.0%
30.0%
65.0%
20.0%
70.0%
35.0%
15.0%
Revenue
Impact
$787.00
210.00
258.00
410.00
-505.00
20.00
50.00
140.00
220.00
145.00
10.00
90.00
200.00
-246.00
316.00
-160.00
420.00
370.00
120.00
35.9%
2,855.00
THE POTENTIAL BENEFITS
 Most physicians under code and under bill because





of compliance concerns.
Most physicians could code higher if they
adequately documented.
The average physician is under coding and under
billing about $5 to $10 per patient encounter.
Physicians can typically handle 20 – 40 encounters
per day (approximately 500 per month or 6000 per
year)
That could mean $30,000 to $60,000 of under
billing per year per physician.
100 physicians = $3 million to $6 million per year!
RESULTS OF TRAINING
Most physicians significantly improve the quality of
their documentation and the accuracy of their
billing.
2. Most physicians greatly reduce the risk of billing
non-compliance because their improved
documentation now supports their billing choice.
3. Many physicians increase their average amounts
billed because the improved documentation
adequately supports higher billing levels.
1.
2010 AVERAGE E/M CODE DISTRIBUTION
FOR NEW PATIENT OFFICE VISITS
50
45
40
37
35
PERCENTAGE
35
30
25
20
13
15
13
10
5
2
0
99201
99202
99203
99204
E/M CODE
Department of Health and Human Services Publication: "Coding Trends of Medicare
Evaluation and Management Services"; May 2012
99205
ACCURATE E/M BILLING
2010 AVERAGE E/M CODE DISTRIBUTION
FOR ESTABLISHED PATIENT OFFICE VISITS
50
46
45
40
36
PERCENTAGE
35
30
25
20
15
9
10
5
5
4
0
99211
99212
99213
99214
E/M CODE
Department of Health and Human Services Publication: "Coding Trends of Medicare
Evaluation and Management Services"; May 2012
99215