News: Part B News

Document ‘stories,’ encourage coder-doctor communication to beat E/M downcoding

Alpha II’s own E/M experts Rex Stanley and Stuart Newsome were interviewed by Editor Roy Edroso for his cover story in the June issue of Part B News:

Let the new Office of Inspector General (OIG) report showing widespread downcoding serve as a warning: You gain nothing — not even protection from auditors — from the practice, which can be reduced by getting coders and doctors to work together.

The OIG’s report found that 15% of the E/M errors in an audit of 2010 data were caused by downcoding — choosing an E/M level that is below what the documentation indicates. That number rose to 36% when auditors removed a category of “highcoding” doctors who billed for level 4 and 5 services 95% of the time.

While many providers understandably worry about denials and chargebacks associated with upcoding, downcoding is an issue of dollars and cents — and quite a few of them. “Think of the impact — if you’re regularly coding level 4s as 3s, and you do that for 20 patients a day, and that’s about a $30 difference, it adds up,” says Michele Olivier, director of coding and audits at Pinnacle Health Care in Centennial, Colo.

Some observers think the problem could be worse than OIG makes out because some downcoding is caused by underdocumentation that would have been invisible to their auditors. “I’d say the undercoding averages closer to 30%,” says Rex A. Stanley, president of Alpha II LLC in Tallahassee, Fla. “A lot of physicians take the stance that ‘if I code low enough, maybe they’ll leave me alone.’”

But it won’t protect you from audits, says his colleague Stuart Newsome, vice president for development. “The reality is, they’re not necessarily looking for higher levels — they’re looking for individuals who are doing it wrong,” he says. “The bell curves show them where the data should be, and they target high and low. Undercoding is a financial risk, but it’s also an audit risk.”