SUBJECT: Billing of Evaluation/Management Services in the Hospital Outpatient Setting

PURPOSE
The purpose of this notice is to update the provider community of issues surrounding the Progressive Corrective Action (PCA) service wide review for Outpatient Evaluation/Management Services in the Outpatient Setting conducted by Highmark Medicare Services and to remind providers of proper billing practices.  This notice is also intended to assist in decreasing the claims error rate and to avoid provider denials for the above listed service.

BACKGROUND

We recently completed a service wide probe review of all Evaluation and Management services in the Outpatient setting.  Coding irregularities and insufficient documentation resulted in a significant error rate of 37%.  Appropriate coding of Evaluation and Management services involves the assessment of all services provided during the visit.  In an effort to arrive at the correct level of service, the most common practice is to report a single visit code per day, assessing all Evaluation and management services provided to arrive at the correct level of service.  Encounters with more than one health professional, and multiple visits with the same health professional that take place during the same session and at a single location within the hospital constitute a single “visit”.  (Pub 100-4 Units of Service)

In order for Evaluation and Management services to be reimbursed by Medicare, the documentation should reflect the medical necessity and that the services were rendered. 

REVIEW SUMMARY
The information provided below is based on the review of submitted claims for Evaluation and Management services from December 2005 through August 2006.  Medical review of claims for Evaluation and Management services for the above mentioned dates continues to show an overall error rate of 37%. 

As a result of this high error rate PCA action was initiated. The majority of the denials were due to insufficient or missing documentation required to make payment.  In Most cases, the billed units were not supported in the documentation.  When HCPC codes are required for services, the units are equal to the number of times the procedure/service being reported was performed.  Evaluation and Management services billed with units greater than one should reflect in the documentation a separate and distinct visit on the same date of service.  In addition, Condition code G0 should be assigned when distinct and independent visits on the same day in the same revenue center occur.

Specific documentation that is helpful in determining the rationale for Evaluation and Management services is listed on the Additional Development Request (ADR) letter.  An ADR is mailed to the provider requesting specific documentation for each claim to be medically reviewed.  The ADR information follows:

(All Documentation Must Be Present To Support Medical Necessity)

• Clinic/Treatment room/emergency room records. 
• Clinical documentation of diagnosis or symptoms to justify services
• History of past and present illness, physical exam, progress notes
• Results of all testing/services billed
• Itemized Bill.   
• Above documentation should be provided for each E&M billed.

It is very important that providers obtain necessary medical documentation from third parties such as physicians or other providers, health care facilities, or suppliers to fully support the services billed to Medicare.  It is the responsibility of the provider submitting the claim for payment to obtain all the requested documentation, regardless of where the records are kept.

When a request for Additional Development Request (ADR) is received, please review and provide the requested documentation prior to submission of claims in order to ensure appropriate review of all information supporting medical necessity for the services billed.
                                                       
In regards to the review of claims from 01/01/06 to 08/30/06, the review revealed that most providers billing multiple units for Evaluation and Management services.  However, The documentation did not support that a separate and distinct visit was performed.  Furthermore, it was identified that Evaluation and Management codes were assigned when a more appropriate code supported the service rendered.  Example:  IV infusion and drug administration. 

In summary, the purpose of this notice is to update the provider community of issues surrounding the Progressive Corrective Action (PCA) service wide review for the use of Evaluation and Management services conducted by Highmark Medicare Services to assist in decreasing the claims error rate and to avoid provider denials of the above listed service.

This is an LPET publication.  You may contact Highmark Medicare Services. Please continue to check the Highmark Medicare Services website for informational bulletins, provider notices and policy updates.

• Pub 100-4 Medicare Claims Processing Manual Chapter 25

• FAQ’s E&M codes for Outpatient Facilities

If you have any questions regarding this bulletin, please contact the appropriate Customer Contact Center at:

Maryland Providers: 1-866-488-0545
Pennsylvania Providers: 1-800-560-6170