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As medical necessity continues to be a hot-button issue in the healthcare industry, getting the level of service correct every time is not only necessary, but critical in order to remain compliant with the Conditions of Participation (CoP) as set forth by the Centers for Medicare & Medicaid Services (CMS). Overuse of inpatient or observation statuses can have detrimental effects on the patient, physician and hospital.

In lieu of a compliant process, the knowing overuse of inpatient status could lead to a false claims issue and/or incorrect reimbursement due to improper classification. Overuse of observation can cause hospital data to appear incorrect. The length of stay, mortality data and cost of inpatient care could be elevated and market share data lowered artificially.

The bottom line is that it’s all about getting every patient in the correct status. And getting it right starts with the first encounter with the patient, generally by a hospitalist, ER or attending physician.  Accurate and thorough physician documentation has always been an important part of the utilization review (UR) process, but it has been spotlighted recently because of new regulations.

According to First Coast Service Options Inc.’s (FCSO) Program Integrity and Provider Outreach and Education Departments, Medicare Administrative Contractors (MACs) will start reviewing physician claims. The source states that “effective Jan. 1, 2012, FCSO also will perform post-payment review of the admitting physician’s and/or surgeon’s (Medicare) Part B services related to inpatient admissions that are denied either because they do not meet the level of care criteria, as services performed could have been performed in a less intensive setting (i.e., outpatient) or documentation did not support the medical necessity of the procedure.”

But MACs aren’t the only government contractors with the ability to target attending physicians.  Recovery Auditors (RAs), formerly known as Recovery Audit Contractors (RACs), also review evaluation and management (E&M) services on physician claims under Part B. The review of duplicate claims or E&M services that should be included in global surgery were available for review during the RAC demonstration and will continue to be available for review.

Increased scrutiny by government auditors of attending physician documentation has added even greater emphasis to the importance of recognizing poor practices, correcting them and then encouraging proper documentation for every case.

To ensure proper documentation, physicians should include a clear plan of care and impression in the history and physical (H&P). Notes for procedures should always address any risk linked to medical history. Also, continued-stay reviews with a recommendation for inpatient status should always include current progress notes or orders to evidence the basis for continued acute care following stabilization.

The CMS Medicare Benefit Policy Manual highlights five key pieces of documentation for Medicare cases and determining medical necessity of inpatient status. These points include:

  • Medical history;
  • Current medical needs;
  • Severity of signs and symptoms;
  • Facilities available for adequate care; and
  • Predictability of an adverse outcome.

To expand on “predictability of an adverse outcome,” a physician may want to start with the basic questions below:

  • Risk assessment – Is this a high- or low-risk patient, and why?
  • Prior Response – Did the patient fail to respond to a prior treatment?
  • Concern for a serious outcome if the patient is not closely monitored on admission – Given the patient’s history and current presentation, what kind of adverse outcomes are likely?
  • Notation that the standard of care is being met – Are you following the treatment guidelines set forth by the American College of Cardiology?

Following the above tips can help improve physician documentation, but only when paired with open communication. It is imperative to educate and collaborate with attending physicians so they understand the importance of thorough and accurate documentation. In the end, it will make everyone’s lives a little easier and keep the hospital and physician within the law.

About the Author

Ralph Wuebker, MD, currently serves as Vice President of Executive Health Resources’ (EHR) ACE (Audit, Compliance and Education) Team. This group of physicians conducts audits and regular visits to EHR’s client hospitals to provide ongoing education on a variety of topics including Medicare and Medicaid compliance and regulations, medical necessity, Recovery Audit Contractors, utilization review, denials management and length of stay.

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Ralph Wuebker, MD, MBA

Dr. Ralph Wuebker serves as Chief Medical Officer of Executive Health Resources. In this role, Dr. Wuebker provides clinical leadership within the company and works closely with hospital leaders to ensure strong utilization review and compliance programs. Additionally, Dr. Wuebker oversees Executive Health Resources’ Client Services teams, who provide onsite education for physicians, case managers, and hospital administrative personnel and help hospitals identify potential compliance vulnerabilities through ongoing internal audit. An expert in CMS regulations, medical necessity compliance, utilization review, denials management, and program integrity efforts, Dr. Wuebker also serves as an industry thought leader and editorial advisor to the media, as well as a highly respected and distinguished industry speaker.

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