Wednesday, June 20, 2012

Finding the Best Medical Billing and Coding Schools


Are you looking to launch your career in the medical field? Both the medical biller and medical coder play a crucial role in the successful operation of a medical practice or facility. In order to make yourself a valuable part of the team, you should ensure that you receive training and certification from an accredited educational institute. There are many medical billing and coding schools that can help you well on your way to educational and career success.

How do you pick the right school for you, however? How do you ensure that the schools you are selecting will best serve your needs for training and best prepare you to pass the certification exams? Let’s take a look at just a few of the steps you should take prior to enrolling in any medical billing and coding schools.

Are They Accredited?

The reality is that anyone can set up shop or a website that will allow them to appear to be a legitimate educational institute. However, if they are not accredited, you will not only be spending your money on a course that might not fully prepare you to take the exams, but your coursework and your certifications may not even be recognized once you set out to find a job.

A simple check to verify their accreditation can potentially save you a significant amount of money and a lot of unnecessary frustrations and delays in getting your career started off on the right foot.

The Right School For You

Picking the right medical billing and coding schools is an important part of ensuring that you will be successful in both passing the exams and landing a great job. There are a few factors that you should consider when you are picking your school.
  • Are you currently working?
  • Do you have reliable transportation?
  • Do you have access to a computer and reliable internet connection?
  • These questions are very important because they can mean the difference between attending a traditional brick and mortar school, and taking your classes online.
Both forms of school can help you to successfully pass your certification exams; however, your current lifestyle and other commitments will have an impact on the type of school that you select. Do a bit of careful consideration and ensure that you pick the right school and the right type of classes for you. If you are currently working, you may find that online classes are the best choice for you. However, if you are not working, you may find that attending class is the best choice. Only you know what will work out best for you and your current situation.

Costs To Consider

Costs are always going to be a factor for most of us when it comes to considering medical billing and coding schools. Fortunately, the majority of schools are sure to have financial aid programs that can help you to still attain your dreams, even while you may be on a strict budget. With the combination of grants, loans, and other financial services, you will be able to get the training that you need. This investment in your future is something that you shouldn’t hesitate over.

Be sure that you pay attention to the fees that your selected schools charge. A reputable educational institute will ensure that you have a detailed plan of your fees upfront so that there are no unpleasant surprises when you are trying to get proof of course completion.

A bit of cost comparison shopping will also help you to narrow down the educational institute that offers the best class costs. Keep in mind that cheaper doesn’t always mean that a school is inferior. The most important thing is that they have a stellar reputation with former students and that they are accredited.

An Investment Of Time, An Investment In You

It can take anywhere from three to twelve months to complete a course at medical billing and coding schools. If you are currently working, or have other commitments, then it might take up to a year to finish your training and pass your exams. The important thing for you to remember is that getting your certifications is an investment in you and in your future.

Qualified professionals are always going to be in high demand in the medical field. Make yourself the best potential candidate, attend well-rated medical billing and coding skills, and launch yourself into a stable and well-paying career that you can be proud of.

Types of Medical Coding Jobs

Within healthcare, multiple job opportunities exist with the majority in great need for qualified workers. Because there is an increasing number of people needing quality medical care, this particular sector is growing faster than expected. Some of the jobs in highest demand are those involving actual medical professionals who provide patient care while others are workers behind the scenes handling patient accounts, running diagnostics, and so on. For this group of people, skilled employees are needed most for medical coding jobs.

As far as medical coding jobs, there are actually several different career opportunities, each being slightly unique and offering a somewhat different pay scale. Because of the huge need in this area, we wanted to provide information specific to options for medical coding jobs that a person might consider. Keep in mind, all of these jobs offer stability, good pay, and opportunity for advancement within the healthcare sector.

Job Information

To start with, it is important to know that while there are many different medical coding jobs from which a person could choose, they do not all fall under this category or have titles that would reflect as being associated with medical billing. Therefore, it would be more beneficial to look at jobs that involve the same type of work opposed to jobs being titled as “medical coding”. Overall, work for jobs such as these includes billing for services provided to patients, as well as medical supplies and procedures.

These jobs entail using a numeric coding system which would be applied to diseases, conditions, treatments, diagnosis, medications, treatment plans, and continued care among other things for each patient seen. With the information for a patient file being properly coded, the process of filing insurance forms for payment or reimbursement would be possible. Therefore, while coding is a large part of these jobs, billing is also involved which is why jobs are sometimes referred to as medical billing and coding.

Although some medical coding jobs are entry level positions, the work requires a skilled professional. Qualifications to work in the various jobs would vary to some degree but they would all require something specific to include the following:

  • Experience in billing and coding
  • Experience working in a healthcare environment
  • Specialized knowledge
  • Experience with insurance or medical billing and coding procedures
Now, there are some companies that will hire a person for medical coding jobs who has not worked in a healthcare environment but for the most part, this would be a huge benefit for the facility and doctor but also the individual hired to do the work. 

Medical Coding Arenas

As mentioned, several different options exist for medical coding to include actual jobs and duties, as well as areas of expertise as shown below. Depending on the individual’s experience, training, and education, as well as the hiring doctor or facility, the area in which a person works could be just one or several.

Medical – The areas that commonly need medical coding experts includes dentistry, cancer care, and pediatrics
Coding System – In this case, areas would include a doctor’s office, nursing home or assisted living facility, or surgical center
Insurance – Along with private and public insurance companies, the individual would likely handle insurance claims with Medicaid and Medicare
Patient – This would include patients on an inpatient or outpatient basis, as well as those receiving emergency care

Job Options

Regarding actual medical coding jobs, the following are a few examples where dedicated and skilled workers are always needed.

Medical Billing Clerk – Primary responsibilities for this job involves maintaining patient records specific to services, goods, and procedures provided for a specific healthcare facility. Invoices would be generated and bills printed for payment from patients, as well as insurance providers, merchants, and various service providers. Because the person in this role would have direct contact with patients and professionals, great communication and customer service would be mandated along with billing and medical coding ability.

Medical Coding Specialist – For this job, medical documents would be reviews and key information about a patient’s condition extracted. That information would then be translated using numerical codes into a diagnostic and procedural system that allows insurance claims to be filed while following regulations set by the federal government.

Clinical Data Specialist – This is the last of the medical coding jobs we wanted to mention, which includes duties of reviewing, editing, and making corrections to data that the internal computer systems generated. With this, accuracy and compliance of information for medical billing purposes could be validated specifically for Medicaid and Medicare.

Monday, June 18, 2012


The Centers for Medicare & Medicaid Services (CMS) and the Centers for Disease Control and Prevention (CDC) created the national version of the General Equivalence Mappings (GEM) to ensure that consistency in national data is maintained. They have made a commitment to update the GEMs annually along with the updates to International Classification of Diseases, 10th Edition, Clinical Modification (ICD-10-CM) and Procedure Coding System (PCS) during the transition period prior to ICD-10 implementation. CMS and CDC will maintain the GEMs for at least three years beyond October 1, 2013, which is the compliance date for implementation of ICD-10 for all covered entities.

1. Are the General Equivalence Mappings a Substitute for Learning to Use the ICD-10-CM and ICD-10-PCS?
The GEMs are not a substitute for learning how to use the ICD-10-CM and ICD-10-PCS. Providers’ coding staff will assign codes describing the patients’ encounters from the ICD-10-CM and ICD-10-PCS code books or encoder systems. In coding individual claims, it will be more efficient and accurate to work from the medical record documentation and then select the appropriate code(s) from the coding book or encoder system. The GEMs are a tool to assist with converting larger International Classification of Diseases, 9th Edition, Clinical Modification (ICD-9-CM) databases to ICD-10-CM and ICD-10-PCS.

2. Who Can Use the General Equivalence Mappings?
The GEMs can be used by anyone who wants to convert coded data. Possible users of the GEMs include the following:

  • All payers;
  • All providers;
  • Medical researchers;
  • Informatics professionals; 
  • Coding professionals—to convert large data sets;
  • Software vendors—to use within their own products;
  • Organizations—to make mappings that suit their internal purposes or that are based on their own historical data; and 
  • Others who use coded data.

3. What are the General Equivalence Mappings?
The GEMs are a tool that can be used to convert data from ICD-9-CM to ICD-10-CM and PCS and vice versa. Mapping from ICD-10-CM and PCS codes back to ICD-9-CM codes is referred to as backward mapping. Mapping from ICD-9-CM codes to ICD-10-CM and PCS codes is referred to as forward mapping. The GEMs are a comprehensive translation dictionary that can be used to accurately and effectively translate any ICD-9-CM-based data, including data for:

  • Tracking quality; 
  • Recording morbidity/mortality;
  • Calculating reimbursement; or
  • Converting any ICD-9-CM-based application to ICD-10-CM/PCS.

The GEMs are complete in their description of all the mapping possibilities as well as when there are new concepts in ICD-10 that are not found in ICD-9-CM. All ICD-9-CM codes and all ICD-10-CM/PCS codes are included in the collective GEMs:

  • All ICD-10-CM codes are in the ICD-10-CM to ICD-9-CM GEM; 
  • All ICD-9-CM Diagnosis Codes are in the ICD-9-CM to ICD-10-CM GEM;
  • All ICD-10-PCS codes are in the ICD-10-PCS to ICD-9-CM GEM; and
  • All ICD-9-CM Procedure Codes are in the ICD-9-CM to ICD-10-PCS GEM.

4. How Have the General Equivalence Mappings Been Used to Date?
To date, the GEMs have been used to:

  • Translate ICD-9-CM codes in the Official ICD-9-CM Coding Guidelines to aid in producing the Official ICD-10-CM Coding Guidelines; 
  • Convert version 26.0 of Medicare Severity Diagnosis Related Groups from an ICD-9-CM-based application to an ICD-10-CM/PCS-based application;
  • Convert the Medicare Code Editor to a native ICD-10-CM/PCS-based application; and
  • Produce a purpose-built ICD-10-CM/PCS to ICD-9-CM crosswalk for reimbursement called the ICD-10 Reimbursement Mappings.

5. What are the Reimbursement Mappings?
The Reimbursement Mappings were developed by CMS in response to non-Medicare industry requests for a “standard one-to-one reimbursement crosswalk,” which is a temporary mechanism for mapping ICD-10-CM/PCS codes submitted on or after October 1, 2013 back to “reimbursement equivalent” ICD-9-CM codes. In order to develop the Reimbursement Mappings, CMS used the GEMs as a starting point by selecting the best ICD-9-CM code that maps to each ICD-10 code based on Medicare data. The Reimbursement Mappings identify the best matching ICD-9-CM code that can be used for reimbursement purposes for each ICD-10 code. All ICD-10-CM/PCS codes are in the Reimbursement Mappings; however, all ICD-9-CM codes are not in the Reimbursement Mappings. Where an ICD-10-CM/PCS code translates to more than one ICD-9-CM code, a single choice is required to create a functioning crosswalk. Inpatient hospital frequency data was used to aid in choosing a final ICD-9-CM translation in the crosswalk. If needed, the Reimbursement Mappings may be used to process ICD-10-CM/PCS-based claims received on or after October 1, 2013, with a legacy ICD-9-CM-based system as part of a planned transition period, until systems and processes are developed to process ICD-10-CM/PCS-based claims directly. The Reimbursement Mappings consist of two crosswalks:

  • ICD-10-CM to ICD-9-CM for Diagnosis Codes; and
  • ICD-10-PCS to ICD-9-CM for Procedure Codes.

CMS is not using the ICD-10 Reimbursement Mappings for any purpose. We are converting our systems and applications to accept ICD-10-CM/PCS codes directly.

6. Is There a One-to-One Match Between ICD-9-CM and ICD-10?
No, there is not a one-to-one match between ICD-9-CM and ICD-10, for which there are a
variety of reasons including:

  • There are new concepts in ICD-10 that are not present in ICD-9-CM;
  • For a small number of codes, there is no matching code in the GEMs;
  • There may be multiple ICD-9-CM codes for a single ICD-10 code; and 
  • There may be multiple ICD-10 codes for a single ICD-9-CM code.

General Equivalence Mappings

In healthcare, diagnosis and procedure codes and their attached descriptions are the currency for many critical data transactions. Healthcare organizations rely heavily on coded data to govern reimbursement, monitor the health of the population, track trends in disease and treatment, and optimize the delivery of healthcare in the US.

The possible implementation of the ICD-10 code set is a historic opportunity to upgrade the quality of healthcare data, but like everything worth having, it comes at a cost. One cost is mapping between the old and new code sets.

A recurring theme in the ongoing ICD-10 implementation debate has been the need for a crosswalk between the old and new code sets to help the industry make the transition. The lack of an “official” mapping between ICD-9-CM and ICD-10-CM/-PCS has long been seen as a major challenge to ICD-10 implementation. The General Equivalence Mappings (GEMs) are an attempt to meet that challenge.

What Are GEMs?

The GEMs are the product of a coordinated effort spanning several years and involving the National Center for Health Statistics (NCHS), the Centers for Medicare and Medicaid Services (CMS), AHIMA, the American Hospital Association, and 3M Health Information Systems. The GEM files are a public domain reference mapping designed to give all sectors of the healthcare industry that use coded data a tool to convert and test systems, link data in long-term clinical studies, develop application-specific mappings, and analyze data collected during the transition period and beyond.

It would be impossible to produce a “one size fits all” set of mappings because a mapping is heavily dependent on its purpose. A map for reimbursement uses different rules and contains different entries than a map for research.

The GEMs are more than simple crosswalks. They cannot be used in a legacy system in unaltered form to get from a code in one set to a code in the other. A clear one-to-one correspondence between an I-9 or I-10 code is the exception rather than the rule.

It is useful to think of GEMs as two-way translation dictionaries for diagnosis and procedure codes from which crosswalks can be made for specific purposes. They elucidate the differences between the code sets and assist users in making informed decisions about how to link the codes in a way that meets their needs.

While ICD-9-CM diagnosis codes and ICD-9-CM procedure codes are maintained by two different government entities, the GEMs were developed separately but collaboratively to maintain consistency insofar as possible. The resulting files can be merged seamlessly as needed—subsets extracted, analyzed, and applied—without taking extra steps to make them compatible.

Wednesday, June 13, 2012

Medical Billing and Coding Certification

Professional medical billing and coding certification is a designation earned by an individual as proof that a minimum level of competency. Certification typically follows graduation from a formal training program and requires passing a certification exam. The certification is usually earned from a professional society and valid for a defined time, such as 1 year. These certifications must be renewed on a periodic basis and require evidence of completion of continuing education units (CEU’s) and maintaining membership in the granting professional society.

Certification is different from being licensed. Licensing is typically required by state government agencies to demonstrate a minimum level of knowledge or ability as required by law.

Benefits of Certification:

  • Distinguishes you from others - gives you an advantage when applying for job over those not certified.
  • Shows your commitment to the profession - Shows management that you are improving.
  • Improves income potential.
  • Demonstrates a basic level of knowledge about the profession.
  • Commitment to ethical responsibilities of the profession.
  • Improved opportunities for advancement.

There's not a combined medical billing and coding certification, but there are separate certifications for medical billing and medical coding. Medical coding certifications are more diverse and involved due to the complexity of coding. Independent home based medical coders and billers benefit from certification for marketing your credentials to potential clients.

Medical Billing Certification

The American Medical Billing Association (AMBA) is probably one of the most recognized organizations offering a medical billing certificate through examination and education. The Certified Medical Reimbursement Specialist (CMRS) is an exam based certification that demonstrates a knowledge in insurance reimbursement, medical terms, coding (ICD9, CPT4 and HCPCS), claim appeals, and compliance (HIPAA and OIG). The CMRS exam has 16 sections with 700 questions. A score of 85% is required to pass and recieve the CMRS credential designation.

The CMRS Exam is divided into 16 Sections:

  • Medical Terminology
  • Anatomy and Physiology
  • Information Technology
  • Web and Information Technology
  • ICD-9-CM Coding
  • CPT-4 Coding
  • Clearinghouses
  • CMS 1500
  • Insurance
  • Insurance Carriers
  • Acronyms
  • Compliance
  • Fraud and Abuse
  • Managed Care
  • General
  • Case Study

Maintaining certification requires obtaining 15 continuing education units (CEU’s) from an approved listing every year. Cost is $325 plus membership in AMBA. AMBA recognizes the CEU’s from courses offered by the AAPC (American Academy of Professional Coders) and many other reputable organizations.

Healthcare Billing and Management Association

The Healthcare Billing and Management Association offers the Certified Healthcare Billing & Management Executive (CHBME) and Certified Medical Billing Associate (CMBA). However these tend to be designed more for executives, managers, and supervisors. Probably the highest level of credentialing offered for medical billing andreimbursement is the RHIA and RHIT certifications offered by the AHIMA (American Health Information Management Association).

RHIA is Registered Health Information Administrator. They are mostly involved with the management of patient health information, medical records, and computer information systems.RHIT is Registered Health Information Technician. They are health information technicians associated with medical records and computer applications and systems.

Medical Coding Certification

Coding credentials are administered by two different organizations - AAPC (American Academy of Professional Coders) and the AHIMA (American Health Information Management Association). Employers may have differing preferences when hiring. If you are considering becoming credentialed talk with an experienced professional already in the coding field and get their opinion.

Here's a summary of their certifications:

AAPC Certifications:

  • CPC - Certified Professional Coder
  • CPC-H - Certified Coding Specialist - Hospital
  • CPC-P - Certified Coding Specialist - Payer
  • AAPC also offers several other specialty credentials

AHIMA Certifications:

  • CCA - Certified Coding Associate. This is an entry-level certification.
  • CCS - Certified Coding Specialist. More proficient coders.
  • CCS-P - Certified Coding Specialist - More proficient Physician Based coder.
  • CHDA - Certified Health Data Analyst

Medical Billing and Coding Training

Medical billing training is typically not as involved as the training needs for medical coding. If you’re goal is a corporate job, generally the more training and credentials the better. Even if you’re planning to stay strictly in medical billing, having some coding knowledge is very useful in understanding coding errors. A good knowledge of coding also makes you more valuable to an employer and justifies asking for a higher salary.

The amount of training you need depends on your goals – getting a good job at a hospital, large practice, or insurance company - or starting a medical billing business. Smaller practices will usually not be as stringent for certification or training. The downside is they probably aren’t going to pay as well or have the benefits of a larger employer. One of the nice things about a smaller practice is they tend to be more informal.

Medical Billing Training

Training for medical billing can be obtained from a variety of sources such as local vocational schools, community colleges, or distance learning (or online). A good medical billing training program establishes a basic foundation in medical billing necessary for an entry level job. A good certificate program can can take anywhere from 6 to 9 months to complete.

Topics typically covered:

  • Keyboarding skills
  • Medical terminology
  • Medical office procedures
  • Billing and insurance reimbursement
  • Basic coding
  • Medical law (HIPAA) and ethics

There are also reasonably priced (less than $1000) reputable medical billing courses online which can be completed at your own pace. If you are considering an online medical billing school, the material should be written by someone with extensive experience in the field. You should also receive a certificate upon successfully completion.

If you are really eager to learn but don’t have a lot of money to invest, free medical billing training is possible if you are willing to work for a while for little or no pay. This can be a great way to get your foot in the door and establish yourself in the field. That’s how I got started. Fortunately the billing service I worked for paid me well so I saw it as basically getting paid to learn medical billing.

Medical Coding Training

Medical coding training can run the whole spectrum from associate’s degree to a diploma or certificate program. On the longer end is an associate’s degree in Healthcare Reimbursement. Some schools may describe this degree slightly differently. This is the most comprehensive medical coding training and can typically take 18 months to 2 years to complete.

The curricula would typically cover:

  • Basic keyboard skills
  • Human anatomy
  • Career planning
  • CPT, ICD, & HCPCS coding
  • Billing and insurance reimbursement
  • Medical terminology
  • Advanced billing and reimbursement
  • Office procedures
  • Medical ethics and law
  • Communications
  • Fine arts or humanities
  • Mathematics
  • Social Sciences

The associates program would prepare a student to take a certification exam by either American Academy of Professional Coders (AAPC) or American Health Information Management Association (AHIMA).

A diploma program is a more abbreviated medical coding training compared to an associate program. This type of program would include more detailed training in procedures and the nuances of healthcare billing. Approximately twice as many courses as the shorter certificate program typicall taking 9 months to 1 year to complete.

The curricula would typically cover:

  • Basic keyboard skills
  • Human anatomy
  • CPT, ICD, & HCPCS coding
  • Billing and insurance reimbursement
  • Medical terminology
  • Office procedures
  • Medical ethics and law

The Medical Billing Claim Process

When a patient visits a physician, the doctor writes down the observed conditions and treatment. This information is then given to a medical coder who assigns the appropriate ICD-9 diagnosis and CPT medical billing codes (and CPT modifiers if necessary). The coder may get a written or voice audio dictation file from the doctor that contains the details of the diagnosis and procedures performed on each patient.

The coder may use reference books to look up the correct diagnosis codes (like the ICD-9-CM Expert for Physicians - 2010 Edition) and the corresponding CPT treatment codes and modifiers (CPC-Current Procedural Coding Expert - 2010 Edition). There are also online coding references such as CodingToday that have the latest treatment and diagnosis codes. These services require a subscription for access but can be a real time saver.

It’s very important that the ICD-9 and CPT codes be correct so the claim doesn’t get rejected. Depending on how thorough a doctor is, coding from the providers dictation or handwriting can be very time consuming. However once you get to know the doctor’s preferences and habits the process goes much more efficiently.

This is where the medical billing specialist gets involved. The codes are then typically entered or checked on a superbill or patient encounter form. You've probable seen one of these when visiting the doctor. Some practices now do this electronically. They take the superbill and input the information into the electronic medical billing software. Paper claims are printed out on a CMS-1500 insurance form and mailed to the insurance carrier.

Electronic claims are sent as an electronic file either directly to the insurance company or to a clearinghouse. The clearinghouse takes the claim information, checks the claim for errors, and sends the claim information electronically to insurance companies. Most clearinghouses have a large payer list and can send claims to mostly all of the major insurance companies. This can be a real time saver as each insurer can have different submittal requirements and interfaces. Claims sent electronically are paid much faster than paper claims. Depending on the practice this could be just a few claims or over 40 claims a day.

If the claim is rejected, the medical billing specialist follows up to find out why it was rejected, correct the claim, and resubmit. An appeal may also need to be written and submitted with supporting information to the insurance company.

When a payment is received from the insurance carrier, it is accompanied by and EOB (Explanation of Benefits). This information is then entered into the medical billing software. If there is any patient responsibility such as co-pays and co-insurance, a patient statement is printed and mailed. This is usually done in batches on a monthly basis. Some patients also have secondary insurance which requires a second claim be submitted with the EOB to the secondary insurer.

Sometimes a patient has questions about their bill. This requires the medical billing specialist to look up their account information and explain the charges and why they were not covered. Many patients don't understand the limits of their insurance coverage and must be referred to their insurer to explain.

Tuesday, June 5, 2012

Diagnosis Codes

Diagnosis Coding
In healthcare, diagnostic codes are used to group and identify diseases, disorders, symptoms, human response patterns, and medical signs, and are used to measure morbidity and mortality. As the plural with the name of this lemma indicates, there will be never one code for all purposes, but many codes for some distinct purposes each.

The codes may be quite frequently revised as new knowledge is attained. DSM changes some of its coding to correspond to the codes in ICD. In 2005, for example, DSM changed the diagnostic codes for circadian rhythm sleep disorders from the 307-group to the 327-group; the new codes reflect the moving of these disorders from the Mental Disorders section to the Neurological section in the ICD.

Commonly used diagnosis coding systems:

  • ICD-9-CM (volumes 1 and 2 only. Volume 3 contains Procedure codes)
  • ICD-10
  • ICPC-2 (Also includes reasons for encounter (RFE), Procedure codes and process of care)
  • ICSD, The International Classification of Sleep Disorders
  • Diagnostic and Statistical Manual of Mental Disorders or DSM-IV (primarily psychiatric disorders)
  • Mendelian Inheritance in Man (genetic diseases only)
  • Read code used throughout United Kingdom General Practice computerised records
  • SNOMED (D axis)

Sunday, June 3, 2012

Ambulatory Procedure Codes

Ambulatory Procedure Codes Explained
APC stands for Medicare's ambulatory payment classification. Hospitals use Medicare APC codes to bill the federal government for hospital services given to Medicare and Medicaid patients. Every item, machine or procedure used to care for a Medicare or Medicaid patient has a specialized code that is submitted by the hospital during the billing process.

What are APCs and where did they come from?

With passage of the balanced budget act of 1997, congress required HCFA to create an Outpatient Prospective Payment System (OPPS). The new payment system, which began being used this past summer, is known as "Ambulatory Payment Classifications" or "APCs."

What was the impetus to create APCs?

  • To transfer financial risk from Medicare to the hospital providing outpatient services.
  • To reduce Medicare beneficiary co-payments from 20% of Medicare BILLED CHARGES to 20% of the Medicare ALLOWABLE CHARGES
  • Change reimbursement for hospital outpatient services from a cost basis(unique to each hospital) to a more standardized prospective payment, similar to the physician fee schedule.
  • Prior to APCs hospitals had always been reimbursed for outpatient services on a cost reporting methodology. Hospitals used to report costs, and then were paid a percentage of those costs. Fundamentally, with the APCs, hospitals get paid a fixed amount regardless of costs for outpatient services, much as they have been getting fixed payments for inpatient services. Essentially, APCs are to outpatient services what DRGs are to inpatient services.

Does every service have it's own unique APC?

No. APC's group services together which are similar clinically and in regards to cost. Within one APC group are many services that are deemed to have comparable resource utilization for provision of services. The designated APC for a service is the method Medicare uses to determine reimbursement. All services within that APC will get the same payment. APCs apply only to the hospital reimbursement, and the Medicare physician fee schedule is not affected by APCs.

What determines which APC a particular service will get assigned to?

APCs are defined solely on the CPT codes. HCFA dropped its original proposal to modify payments based on diagnosis codes. Hospitals still need to report diagnosis codes, however, they will not affect payment.

What are the various APCs, and which apply to emergency department visits?

There are 225 surgical APCs. There are 188 "Ancillary Services" APCs (Radiology, Pathology, other diagnostics and special medications). There are 30 CPT codes which describe outpatient physician-patient encounters, and the 30 CPT codes map to seven "Medical Visit" APCs; four of the seven medical visit APCs deal with emergency department visits:

  • APC 610 (Low level visit) - CPT codes 99281,99282
  • APC 611 (Mid level visit) - CPT code 99283
  • APC 612 (High level visit) - CPT code 99284, 99285
  • APC 620 (Critical care) - 99291

How does a facility choose which level of service to assign? Does that level need to match the physician E/M level?

HCFA has stated that a hospital must follow its own system for assigning different CPT levels. The assigned levels must "reasonably relate to the intensity of hospital resources." Hospitals now need to define their services using the CPT E/M codes (99281-99285, and 99291). Hospitals can continue to use current ED levels of service but must map them to corresponding CPT E/M code for billing Medicare. HCFA will monitor outpatient visit facility level data, and could standardize coding requirements in the future. HCFA has stated that physician and hospital E/M codes do not need to correlate, and may assign different levels. This was contrary to what many people anticipated when APCs were being developed.

What services are included in the APC payments to hospitals for E/M visit levels?

Items included (no separate payment) within APCs include: incidental services (venipuncture), medical/surgical supplies and equipment, introduction of needle catheters, pharmaceuticals (most), observation services, capital related costs and surgical dressings.

Besides the visit level services (99281-99285 and critical care), what else are hospitals reimbursed for?

APCs for visit levels are a basic payment for facility and staff costs. Additional payments are made for additional procedures performed by the nurse or physician. Nursing services that get additional payments include IV infusions and IM injections. These procedures are NOT subject to discount for multiple procedures. This is a change for hospitals that in the past would charge for the medication, and in the charges for the medication was the nursing component. Now, with APCs, the facility is paid for the procedure (such as an injection or infusion), but not for the medication. The physician or nurse may perform the procedures.

Items excluded (additional payments are made) from visit APCs include: blood products, diagnostic laboratory services, radiographic studies, some expensive medications (such as thrombolytics), immuno-suppressives, Durable Medical Equipment (such as crutches and walkers) and some high cost, infrequently used medications. Two new APCs were created for splinting and strapping. All of the CPT codes for splinting and strapping map to these two new APCs (APC 05 for all leg splints, and APC 059 for all arm splints).

How are payments determined?

Each APC has its own relative weight. Payment for each APC varies, based on the relative weight of that APC. The "two times rule" requires that the ratio of the highest cost service to lowest cost service within an APC cannot be more than 2.

Medicare reimbursement formula:

Reimbursement for each APC equals: (APC "relative weight") (conversion factor). The conversion factor for 2000 is $48.48. For example, critical care code 99291 maps to APC 620. APC 620 has a relative weight of 8.60. The 2000 conversion factor is $48.487. The 2000 payment for critical care is: 8.60 x $48.487 = $416.99.

The Local Wage Index is factored. Sixty percent of the APC payment is deemed due to employee wages. So, 60% of APC payment is multiplied by the local wage index, and adjusted accordingly.  Forty percent of the APC is not subjected to the local wage index. After the APC is adjusted for the local wage index, a payment is determined, which is the "adjusted payment rate."  The co-pay is determined through a historical formula.

Can beneficiary co-payments vary from hospital to hospital?

Yes. Hospitals can now compete on the basis of price by lowering patient co-payments. There are minimum and maximum co-payments established for all APCs. Hospitals can elect to reduce co-payments for each calendar year. The decision to reduce co-payments must be for the entire APC category and must apply to the entire year. Hospitals must collect at least the minimum co-payment.

What are some of the new coding issues facing hospitals?

Hospitals are required to use modifiers when both visit levels and procedures are coded to avoid claims of unbundling. Use of modifiers is brand new to hospital coders. Hospitals should still list supplies/medications, although no separate payments will be made. Diagnosis codes should still be assigned to document the medical necessity of services provided.  Status codes are assigned to APCs. Surgical procedures that are assigned to an APC with a Status code "T" will pay the full payment for the highest value service. Additional services provided within the same, OR OTHER APC GROUP designated with a "T" status will be paid at 50% of the listed payment. APCs designated with an "S" or an "X" are not subject to the discount for multiple procedures.

How are observation services affected?

No additional payment will be made for observation services which creates an increased financial incentive for physicians to make disposition decisions in a more timely fashion (admit rather than "observe" for hours in the ED). Observation services are bundled into the facility levels. The hospitals will not get extra payment for continued ED observation if the patient is already at the highest APC level. Additionally, there is now an incentive to quickly admit critically ill patients in to inpatient status instead of remaining in outpatient status while in the ED; the hospital will get reimbursed under a DRG instead of an APC if the patient expires.

Hospitals may still want to report observation services even though they are not getting paid for it. HCFA will continue to monitor for future payment consideration; however if hospitals stop reporting the service, it may be more difficult for HCFA to assess this need.

What are the projected payment implications of APCs?

HCFA is now projecting a minimal decrease or actual increase in payments as a result of implementation of APCs. HCFA is phasing in payments over a four-year transition period. For four years, hospitals experiencing lower payments than they would have without APCs will receive additional payments. Hospitals that generate more revenue during the 4-year transition will get to keep the additional payments.

How must hospitals adapt to the APC reimbursement methodology?

APCs are a fee schedule based on services provided, much like the physician fee schedule. This fee schedule represents a new approach for hospitals that used to be reimbursed based on their costs. All outpatient services are defined in the CPT manual; there are about 300 distinct procedures provided in the ED. These specific procedures must be listed on the UB92 billed to Medicare.

Hospitals must identify physician and nursing procedures for outpatient areas—something that they have not needed to do previously for reimbursement.

Procedures had previously been bundled into the facility levels. Procedures are now billed separately, which for the hospital is essentially like unbundling of services compared to their prior practice. Procedures such as laceration repairs, EKG monitoring, splinting, CPR, etc. must now be identified and coded appropriately (including the use of modifiers) in order to be reimbursed by Medicare at the rate for the corresponding APC. Outpatient nurses need to be trained to identify the procedures they perform and to support the visit level assigned through documentation. There must be an established tiered visit level structure, and coding staff must follow the requirements for assigning the various levels.

CPT/HCPCS codes are generally a new concern to hospital coders. Hospitals may want to consider outsourcing their coding of emergency department visits. Hospital coders have not had to concern themselves with the issues surrounding outpatient ED services. Training and/or retaining coding staff with expertise in CPT/ HCPCS methodology may prove difficult, and revenue may be lost if coding is done poorly. Maintenance of the charge master is another huge operational challenge that hospitals are facing; if coders have successfully adapted to assigning the appropriate codes, the charge master must be able to identify these codes. Extensive revisions to the charge masters are needed. The charge masters must be able to identify all procedures and list them appropriately as identified in the APC categories. Hospitals may not want to apply APC criteria to all of their payers, because by ignoring each payer's unique billing criteria revenue may be lost.

Is economic physician profiling one step closer?

Yes. Late physician documentation will delay submission of hospital bills. Additionally, unlike with other hospital services, late charges are unlikely to be allowed once the APC is determined and paid. Medicare will be assigning the APC codes based on the codes submitted by the hospital. Once the APC is assigned, there will not be an easy mechanism for revision. Emergency physicians will need to be timely and thorough in completing their documentation.

Resource utilization by physicians will come under increased scrutiny. Higher expense medications now represent pure cost, as they provide no added revenue. Choices of medications and the cost of supplies used go directly to the hospital's bottom line. There may be more economic impetus to develop practice guidelines. As mentioned earlier, the choice to admit a patient, versus observing in the ED results in a DRG payment versus an APC payment. The codes assigned will need to be supported through physician and nurse documentation as will the medical necessity of those services. Although there is no requirement for physician documentation to support the visit level assigned, physician documentation will add to the coding in areas where nursing documentation is lacking. In addition, in practicality, coders will be looking to physicians to appropriately and comprehensively identify their own procedures in order to assign the most accurate codes.

What are some future considerations of APCs?

HCFA has not stated that they plan on expanding APCs in to one payment for all services provided in hospital outpatient departments, including the emergency department. However, a single hospital payment would clearly simplify the reimbursement system for Medicare. If there was one global payment that included physician services, ED physicians could find themselves in a difficult position; how would that one lump payment be split up? Would it be left up to the hospital to determine how to split up the payment? It could prove quite difficult dividing up the payments between the ED physicians, medications, radiology, supplies, respiratory therapy etc. and other physician services.

Additionally, if Medicare saves money through implementation of APCs, it might not be long before we see other payers attempting to utilize the same reimbursement methodology.

Friday, June 1, 2012

ICD-10 Codes

The International Statistical Classification of Diseases and Related Health Problems, 10th Revision (ICD-10), of 1992, is a medical classification list by the World Health Organization (WHO), for the coding of diseases, signs and symptoms, abnormal findings, complaints, social circumstances, and external causes of injury or diseases. The code set allows more than 14,400 different codes and permits the tracking of many new diagnoses. Using optional subclassifications, the codes can be expanded to over 16,000 codes. Using codes that are meant to be reported in a separate data field, the level of detail that is reported by ICD can be further increased, using a simplified multiaxial approach.

The WHO provides detailed information about ICD online, and makes available a set of materials online, such as an ICD-10 online browser, ICD-10 Training, ICD-10 online training, ICD-10 online training support, and study guide materials for download.

The International version of ICD should not be confused with national Clinical Modifications of ICD that include frequently much more detail, and sometimes have separate sections for procedures. For instance, the US ICD-10 CM has some 68,000 codes. The US also has ICD-10 PCS a procedure code system not used by other countries that contains 76,000 codes.

Work on ICD-10 began in 1983 and was completed in 1992.

Some 25 countries use ICD-10 for reimbursement and resource allocation in their health system. A few of them made modifications to ICD to better accommodate this use of ICD-10. The article below makes reference to some of these modifications. The unchanged international version of ICD-10 is used in about 110 countries ICD-10 for cause of death reporting and statistics.

The United States will begin official use of ICD-10 on October 1, 2014, using Clinical Modification ICD-10-CM for diagnosis coding and Procedure Coding System ICD-10-PCS for inpatient hospital procedure coding. All HIPAA "covered entities" must make the change; a pre-requisite to ICD-10 is the adoption of EDI Version 5010 by January 1, 2012. Enforcement of 5010 transition by CMS, however, was postponed by CMS until March 31, 2012, with the federal agency citing numerous factors, including slow software upgrades. The implementation of ICD-10 has already been delayed. In January 2009, the date was pushed back by two years, to October 1, 2013 rather than a prior proposal of October 1, 2011

ICD-9 Codes

ICD-9-CM (International Classification of Diseases, 9th edition, Clinical Modifications) is a set of codes used by physicians, hospitals, and allied health workers to indicate diagnosis for all patient encounters. The ICD-9-CM is the HIPAA transaction code set for diagnosis coding.

ICD means International Statistical Classifications of Diseases. ICD codes are alphanumeric designations given to every diagnosis, description of symptoms and cause of death attributed to human beings.

These classifications are developed, monitored and copyrighted by the World Health Organization (WHO). In the United States, the NCHS (National Center for Health Statistics), part of CMS (Centers for Medicare and Medicaid Services) oversees all changes and modifications to the ICD codes, in cooperation with WHO.

Here is how WHO describes the ICD system: ICDs apply to "all general epidemiological, many health management purposes and clinical use. These include the analysis of the general health situation of population groups and monitoring of the incidence and prevalence of diseases and other health problems in relation to other variables such as the characteristics and circumstances of the individuals affected, reimbursement, resource allocation, quality and guidelines."

The current International Classification of Diseases can trace its roots back to the Bertillon Classification first published in 1893. Starting in 1900, experts met about every 10 years under the auspices of the French government to revise the classifications. The fifth revision was published just before World War II. The World Health Organization took over responsibility for ICD in 1946 with publication of ICD-6. The intended purpose of the ICD-9 diagnosis codes (Volume 1 and 2) is for statistical tracking of diseases. Nothing more. Codes are added only when it can be demonstrated that it will help in the identification and monitoring of the disease.

The current edition in the United States for morbidity classification, ICD-9-CM, has been in use since 1979. The original intent for the diagnosis codes was for epidemiological and not billing functions, although in the US, the codes are used by payers for billing and reimbursement purposes.

ICD-9 diagnosis codes consist of 3-5 numeric characters representing illnesses and conditions, and alpha-numeric E codes, describing external causes of injuries, poisonings, and adverse effects; and V codes describe factors influencing health status and contact with health services.

ICD-9-CM consists of three volumes. Physicians use Volumes 1 and 2 only to assign diagnosis codes. Physicians use Current Procedural Terminology (CPT), published by the American Medical Association, to report medical and surgical procedures and physician service codes, rather than Volume 3 of the ICD-9-CM codes. The 3rd Volume of ICD-9-CM is used by Hospitals for reporting inpatient procedures and resource utilization.

There Are Several ICD Code Sets

There are actually several lists of these codes, all of which relate to each other. While the code numbers may be the same, sometimes they will have extra numbers or letters attached to them for different uses. In these examples, the use of # will relate to a number. See a description for these numbers, below.

ICD-##-CM codes are used for diagnosis purposes. CM means "clinical modification." It is used by hospitals and other facilities to describe any health challenges a patient has, from his diagnosis to symptoms to outcomes from treatment, to causes of death. As we move more and more into electronic medical records, these codes will be used even further by physicians and other medical professionals.

ICD codes are used by government health authorities to track certain diseases. For example, if someone contracts the flu, an ICD-9-CM 486 will be recorded. Certain diseases, often those that are highly contagious, or those that have public health interest like lung cancer or HIV, are tracked by authorities to help ascertain how they spread, where they are prevalent, and perhaps to help budget programs or research to work on prevention.

ICD codes are also used to describe a cause of death. They are added to death certificates to explain why someone has died. Many of these, too, are tracked by health authorities.

ICD codes are used internationally (remember, they emanate from WHO) and each country may tailor the codes to fit their own needs. Therefore, some code sets will have extra letters addended to them to describe which country they come from. For example, ICD-##-CA codes are used in Canada and ICD-##-AM codes are used in Australia.

What Do the Numbers Mean? ICD-09, ICD-10 and Others

ICD codes were first developed in 1893 in France by a physician, Jacques Bertillion. They were called the Bertillon Classification of Causes of Death. In 1898, they were adopted in the United States, and were considered, in effect, ICD-1 because that was the first version of code numbers.

Since then, as medical science has progressed and new diagnoses have been developed, named and described, the code lists have been updated. The number designation changes when the updates are so extensive that a wholesale change needs to be made. There may be annual updates, too, but those are considered to be relatively minor, and the basic code set doesn't change. For example, the upgrade in 1949, ICD-6, was the first time mental disorders were added to the code set. The upgrade in 1977 to ICD-9 was the first time procedure codes were added, and the CM designation was included.

Most of the codes we see in the United States today are version 9, called ICD-9-CM codes. With few exceptions, the paperwork we receive when we leave a doctors office will contain both CPT codes (Current Procedural Terminology) to describe the service that was rendered for billing purposes, and ICD-9-CM codes to describe why that service was provided. Further, most death certificates filed since 1977 will have an ICD-9 code on them.

The most current list of codes in use is ICD-10. This list was first used in the United States in 2007. Minor revisions added to ICD-10 codes were made available in early 2009 by the NCHS. Globally, most other countries in the world have implemented the ICD-10 codes. There are some major differences between the two code sets, the transition is very expensive, and most American providers have not yet upgraded to the ICD-10 system.

ICD-11, the next major update, is projected to be ready in 2010, with expected implementation by 2015.


Healthcare Common Procedure Coding System

The Healthcare Common Procedure Coding System (HCPCS, often pronounced by its acronym as "hick picks") is a set of health care procedure codes based on the American Medical Association's Current Procedural Terminology (CPT). 

HCPCS Codes are numbers assigned to every task and service a medical practitioner may provide to a Medicare patient including medical, surgical and diagnostic services. Since everyone uses the same codes to mean the same thing, they ensure uniformity. For example, no matter what doctor a Medicare patient visits for an allergy injection (code 95115) that doctor will be paid by Medicare the same amount another doctor in that same geographic region would be.


The acronym HCPCS originally stood for HCFA Common Procedure Coding System, as the Centers for Medicare and Medicaid (CMS) was previously (before 2001) known as the Health Care Financing Administration (HCFA). The Healthcare Common Procedure Coding System (HCPCS) was established in 1978 to provide a standardized coding system for describing the specific items and services provided in the delivery of health care. Such coding is necessary for Medicare, Medicaid, and other health insurance programs to ensure that insurance claims are processed in an orderly and consistent manner. Initially, use of the codes was voluntary, but with the implementation of the Health Insurance Portability and Accountability Act of 1996 (HIPAA) use of the HCPCS for transactions involving health care information became mandatory.

Levels of codes

HCPCS includes three levels of codes:

  • Level I consists of the American Medical Association's Current Procedural Terminology (CPT) and is numeric.
  • Level II codes are alphanumeric and primarily include non-physician services such as ambulance services and prosthetic devices, and represent items and supplies and non-physician services not covered by CPT-4 codes (Level I).
  • Level III codes, also called local codes, were developed by state Medicaid agencies, Medicare contractors, and private insurers for use in specific programs and jurisdictions. The use of Level III codes was discontinued on December 31, 2003, in order to adhere to consistent coding standards.

CPT Codes

CPT (Current Procedural Terminology) codes

CPT Codes are numbers assigned to every task and service a medical practitioner may provide to a patient including medical, surgical and diagnostic services. They are then used by insurers to determine the amount of reimbursement that a practitioner will receive by an insurer. Since everyone uses the same codes to mean the same thing, they ensure uniformity.

It should be noted, however, that uniformity in understanding what the service is, and the amount different practitioners get reimbursed will not necessarily be the same. For example, Doctor A may perform a physical check up (99396) and be reimbursed $100 by your insurance company. If you went to Doctor B, his reimbursement by your insurance company for that same checkup, Code 99396, might only be $90. (This is not true for Medicare patients. Medicare uses HCPCS codes instead.)

(There is another set of codes used by physicians and facilities, too. These are called ICD codes, like ICD-9 or ICD-10 codes. They do not relate directly to billing, so are described separately.)

CPT codes are developed, maintained and copyrighted by the AMA (American Medical Association.) As the practice of health care changes, new codes are developed for new services, current codes may be revised, and old, unused codes are discarded. Thousands of codes are in use, and they are updated annually. Development and maintenance of these codes is overseen by editorial boards at the AMA, and the publications of all the software, books and manuals needed by those who use them brings millions in income (*see note below) to the AMA each year.

The Current Procedural Terminology (CPT) code set is maintained by the American Medical Association through the CPT Editorial Panel. The CPT code set describes medical, surgical, and diagnostic services and is designed to communicate uniform information about medical services and procedures among physicians, coders, patients, accreditation organizations, and payers for administrative, financial, and analytical purposes.

New editions are released each October. The current version is the CPT 2011. It is available in both a standard edition and a professional edition.

CPT coding is similar to ICD-9 and ICD-10 coding, except that it identifies the services rendered rather than the diagnosis on the claim.

CPT is currently identified by the Centers for Medicare and Medicaid Services (CMS) as Level 1 of the Health Care Procedure Coding System.

Types of codes

There are three types of CPT codes: Category I, Category II, and Category III.

Category I:

Category I CPT Code(s). There are six main sections:
  • Codes for Evaluation and Management: 99201-99499
  • Codes for Anesthesia: 00100-01999; 99100-99150
  • Codes for Surgery: 10021-69990
  • Codes for Radiology: 70010-79999
  • Codes for Pathology & Laboratory: 80047-89398
  • Codes for Medicine: 90281-99199; 99500-99607

Category II:

Category II CPT Code(s) – Performance Measurement (optional) (Category II codes: 0001F-7025F)

Category III:

Category III CPT Code(s) – Emerging Technology (Category III codes: 0016T-0207T)

Examples of CPT Codes:
  •     99214 may be used for a physical
  •     90658 indicates a flu shot
  •     90716 may be used for chicken pox vaccine (varicella)
  •     12002 may be used to stitch up a one-inch cut on a patient's arm

If you use Medicare, you'll see CPT codes, but used a bit differently. Medicare uses HCPCS codes (Healthcare Common Procedure Coding System.)

Matching CPT Codes to the Services They Represent

As patients, our interest in these codes is usually related to our doctors' and insurance billings. Until recently it was difficult to find out what certain CPT codes meant without contacting your insurance company or doctor's office.

You won't find a freely-available comprehensive list of CPT codes, because the AMA controls their publication. Groups that have tried to make them available for free to the public have been cited for violations, fined by the AMA and have been forced to remove them from the Internet. Since the AMA developed and copyrights the system, it has a right to make sure access to these lists is paid for. It licenses CPT code lists to groups who wish to publish the codes to make them available to others. Those groups then charge a fee for access, too.

We patients don't have the large sums of money needed to subscribe to websites or purchase publications that list CPT codes. To make them more accessible to us, the AMA does provide on its website a means for looking up the individual CPT codes you might find on your doctor's bills or EOBs (estimates of benefits).

Medical Billing and Coding Career

Medical Billing and Coding Career Reference Guide

Considering a medical billing and coding job?

A career in medical billing or coding offers an opportunity in a field that will always need employees. ContexoMedia will provide you with a brief introductory guide to what a medical billing specialist and medical coder does, what kind of training is needed, expected salary range, and what the career options are.

You've probably have seen the ads promising at home medical billing and coding jobs. I’ll discuss the reality of medical billing and coding jobs from home based on my experiences.

Career Options
Not only is there a need for medical billing and coding specialists for doctors and hospitals, there's also opportunities for medical billing and coding careers as:
  • Consultants for practices advising on billing and coding practices and compliance issues.
  • Specialists who work for medical billing and coding services and serve multiple practices and specialties.
  • Insurance and coding specialists for commercial and private insurance and local, state, and federal government agencies.
  • Advisers for liability and malpractice.
  • Consumer billing advocates.

Proceed to the NEXT Level...

Medical Auditing

What is Medical Auditing?

Medical Auditing Medical auditing is a key step in the livelihood of a compliant and profitable process. Ensuring medical necessity, correct coding and compliance with regulatory issues, a medical audit focuses on many areas of a practice including:

  • Compliance and Regulatory Guideline Knowledge
  • Coding Concepts
  • Scope and Statistical Sampling Methodologies
  • Medical Record Auditing Skills and Abstraction Ability
  • Quality Assurance and Risk Analysis
  • Communication of Results and Findings
  • The Medical Record

Medical Reimbursement

What is Medical Reimbursement?

Reimbursement for procedures and services performed by providers is made by commercial payers such as Aetna or United Healthcare or federal intermediaries acting on behalf of a half-dozen programs. Reimbursement is based on claims and documentation filed by providers using medical diagnosis and procedure codes.

Commercial payers must use standards defined by the U.S. Department of Health and Human Services (HHS) but are largely regulated state-by-state. Save for specific national mandates such as reimbursement for childbirth, commercial payers determine their own rules of medical necessity or payment and reimbursement fee schedules. Federal intermediaries are regulated as contractors by the Centers for Medicare & Medicaid Services (CMS).

Medicare reimburses physicians and other providers/suppliers for services rendered to Medicare beneficiaries on a fee-for-service (FFS) basis. CMS develops fee schedules for physicians, ambulance services, clinical laboratory services and durable medical equipment, prosthetics, orthotics and supplies.

For a one-stop resource on the informational needs and interests of Medicare FFS providers, including physicians, other practitioners and suppliers, go to the Provider Center on the CMS Web site.

Medical Coding

What is Medical Coding?

Medical classification, or medical coding, is the process of transforming descriptions of medical diagnoses and procedures into universal medical code numbers. The diagnoses and procedures are usually taken from a variety of sources within the health care record, such as the transcription of the physician's notes, laboratory results, radiologic results, and other sources.

Diagnosis codes are used to track diseases and other health conditions, whether they are chronic diseases such as diabetes mellitus and heart disease, to contagious diseases such as norovirus, the flu, and athlete's foot. These diagnosis and procedure codes are used by government health programs, private health insurance companies, workers' compensation carriers and others.

Medical classification systems are used for a variety of applications in medicine, public health and medical informatics, including:

  • statistical analysis of diseases and therapeutic actions
  • reimbursement; e.g., based on diagnosis-related groups
  • knowledge-based and decision support systems
  • direct surveillance of epidemic or pandemic outbreaks

What does a Medical Coder do?

Medical coding professionals provide a key step in the medical billing process. Every time a patient receives professional health care in a physician’s office, hospital outpatient facility or ambulatory surgical center (ASC), the provider must document the services provided. The Coder will abstract the information from the documentation, assign the appropriate codes, and create a claim to be paid, whether by a commercial payer, the patient, or CMS.

A medical billing coder analyzes patient charts and assigns the appropriate medical diagnosis codes and CPT medical billing codes. These codes are derived from ICD-9 codes and corresponding CPT treatment codes and any related CPT modifiers. Some medical billing and coding specialists obtain some type of certification from a recognized professional organization. In general the more certifications the greater the income potential. Proper coding is very important to getting fairly reimbursed.

Good coding complements the billing process and insures the provider is getting fairly compensated. Even if you want to stick strictly to medical billing, having a basic understanding of what the medical coding specialist does is important. If you are a biller, the more you can learn about coding, the more valuable you are to a practice or billing company. Most small practices don't have dedicated coders or billers - they multi-task and may perform limited coding functions in addition to billing.

The medical billing specialist really needs to know enough about coding to see when the CPT medical billing coding are not compatible with the ICD 9 codes. For smaller practices the provider may do their own coding and the medical billing specialist acts more to identify out of date codes so the provider can correct them. Most practices use a lot of the same CPT and ICD-9 codes so once you become familiar with the codes and medical billing modifiers, you've conquered the most difficult part. The most commonly used ones may be listed on the practice superbill.

For family or internal medicine practices, you may see a wider variety of codes and modifiers than for specialty providers. My medical billing company serves smaller practices that may need coding services, so we offer medical coding services to complement our billing services. Many medical billers prefer to stay strictly with medical billing services and that's great. But if you can become proficient in coding - even if you are not an expert - you're much more valuable to a provider.

Medical Billing

What is Medical Billing?

Medical billing & coding is the process of submitting and following up on claims to insurance companies in order to receive payment for services rendered by a healthcare provider. The same process is used for most insurance companies, whether they are private companies or government sponsored programs. Medical billers are encouraged, but not required by law to become certified by taking an exam such as the CMRS Exam, RHIA Exam and others. Certification schools are intended to provide a theoretical grounding for students entering the medical billing field.

So what does a Medical Biller do?

Basically everything involved to get a doctor or other health care professional paid for their services. This is both payment from the insurance carrier and the patient. A medical billing specialist should be detailed oriented, have good math and data entry skills, understand insurance claims procedures, medical billing terms, medical diagnosis codes, and become familiar with medical billing guidelines.

Medical Billing as a Profession

A medical biller is not a medical coder, but a medical biller might need basic medical coding knowledge, since both disciplines are so closely related and co-dependent.

We can't discuss medical coding unless we also speak about medical billing, so closely are these two tied in with each other. Both discipline's goal is to assure that medical reimbursement claims are promptly processed and submitted to health insurance carriers, and the health care provider and facility gets paid for medical services rendered.

A Medical Biller Is...

Medical billers must understand all aspects of common health care and medical insurance options, including the different plans, carrier requirements, and state and federal regulations. It is also essential that they are able to find and pinpoint relevant information from source documents so that all claims for care and procedures are properly processed. As the saying goes: A medical biller is the provider's key to getting paid!" In order for the doctor's medical practice, clinic, or hospital to prosper the medical biller must know the concept of a clearinghouse and an A/R, and understand how to verify insurance coverage, determine eligibility, collect data, submit all claims, avoid denials, contact patients and communicate with insurance companies to ensure the highest possible return of revenue for their employer, or client.

Medical billing for facility-based providers is different from billing for non-facility based providers; just like inpatient coding is different from outpatient coding. Health care provider billing involves submitting claims for individuals, such as physicians, chiropractors, nurse practitioners, physical therapists, podiatrists, dentists, etc.; hospital billing involves claims for inpatient services, which, in turn is different from ambulatory emergency services for people who were treated in the ER, but not admitted to the hospital's nursing ward.

What are Billable Health care Costs?

The biggest segment of health care cost and expenses comes in form of bandages, prostheses, devices, implants, medications, equipment, apparatuses, and countless other items required for modern care. These items and the services associated with them must be properly coded and billed to the patient, or their health insurance provider for reimbursement. This also includes wound care, and hospital stays. Understanding the reason for an insurance company's claim denial is very important.

Submitting Medical Claims

Submitting medical claims is just as diverse as any other job. The medical biller must know the claims processing guidelines for common health care plans, such as Blue Cross/Blue Shield, Tricare, Medicare and Medicaid, etc, and state regulations that apply. There are three basic areas for billing:

  •   inpatient hospital 
  •   outpatient services 
  •   physician billing

This goes along with other sub-areas of specialized billing, such as for DME (durable medical equipment), and for home health care, these are the three areas most entry level medical billers are expected to handle.

Do Medical Billers Code?

A medical biller with enough medical coding knowledge is certainly capable of verifying that medical codes are used correctly, however, the initial medical coding process is not necessarily their forte. Why? Because often they are not specifically trained in medical coding. If they attempt to do it anyway and something goes wrong it can create liability for them. The medical biller's strength lies in their knowledge of different health insurance plans, provider contracts, state rules and regulations and getting denied claims overturned and paid when the denial was incorrect. Of course, experienced medical billers with enough general knowledge of the medical coding process are certainly allowed to handle the medical coding and billing process from start to finish.