Strategic Coding

Ryan Ames, OD, MBA

InSight Eye Care, Oshkosh, WI

With a new year, we typically find ourselves making commitments to “do better” in life, exercise more, spend more time with our family, etc. Could we maybe add proper coding of our medical records to the list? Now I know that may sound like an extremely boring and a pretty mind numbing thing to do, but what if I told you it would likely improve your net and put more money in your pocket? Thereby helping to provide you with the means to do all the other things you are striving to “do better” this year.

Every month I audit around 100 optometric medical records. Along with making sure they recorded a reason for visit that matches the primary dx, I make sure they billed the correct CPT code that matches the documentation.

From a compliance standpoint, that is obviously important, but I can tell you that most of our colleagues are under-coding their billing more often than over-coding. And even if they selected an appropriate 99000 or 92000 code, they frequently will select the series that reimburses the least. If you have the choice between billing 99213 or 92012, why would you choose the one that reimburses less? I call selecting the higher reimbursing code Strategic Coding. You do not always have the choice between both code sets, but often you do. In those situations, you want to utilize both sets to maximize your reimbursements.

Recently I performed an analysis for a two-doctor office. Both doctors were primary care OD’s with a nice mix of routine and medical office visits. Dr. A’s revenue from professional services per patient encounter was $110 and Dr. B’s was $95. By just looking at those numbers I thought, “That’s pretty close; they are probably doing things similarly.” Then I did the back-of-the-envelope math and realized how far off my assumption was. There is a $15/patient encounter difference between these two doctors, so I wondered what the financial impact would be if Dr. A would have seen Dr. B’s patients, thereby generating $15 more per encounter.

As you can see in the table, that $15/patient equates to a difference in revenue of $46,500/yr. This means that if Dr. A would have seen those same patients, his professional services revenue would have been $46,500 MORE than what Dr. B generated. Clearly Dr. A’s patient base may be slightly different and more complicated than Dr. B’s, and that could account for some of the difference between their revenue per patient. But these doctors are in the same clinic, in the same city, drawing patients from the same insurance panels, so I would assert that their patient bases are more alike than they are different. So, I started to dig into these doctors’ billing habits and looked for a difference. I was not surprised to find that Dr. A uses a much wider range of codes, including many 99214 visits, along with 92012 linked to medical care. Dr. B, on the other hand, appeared to be a big fan of 99213 and 92014 with a handful of 99212 and the very rare 99214. I’ll add that I have been auditing these doctors’ charts for a few years, and Dr. A’s charts are typically coded correctly, while Dr. B is a notorious under-coder.

What this example demonstrates is that by coding correctly, based on the documentation and choosing the coding series that has the better reimbursement, Dr. B could have increased his NET income (money on the barrelhead) by ~$46,500 last year had he spent just a few seconds longer and picked the most accurate code. We’re not looking at just a few dollars here, or simply coding better because we should, we are looking at substantial income differences when a doctor makes the decision to truly pay attention to coding choices. This process improves your income by not having to see any more patients per day, not making a capital expense, nor having to sell any more products. It simply involves you choosing a different number at the end of the exam. With the proper process in place, you could manually grade your own records in less than a minute. If we added 60 seconds to the end of each of those 3100 encounters, we are looking at ~52 hours of additional time per year. That may sound like a lot, but with a potential increase in revenue of $46,500/year, that equals $894/hour. That 60 seconds per chart would likely be the most profitable minute of your day.

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