medical billing transcription supplier information

Understanding the Current Procedural Terminology system helps enhance compliance and reduce delays in reimbursement.

Health care acronyms are starting to sound like those of politics and government, and the comparison is apt. Among the flurry of abbreviations (Table I) that deserves special attention from laboratories receiving reimbursement from Medicare and Medicaid is CPT, or Current Procedural Terminology.

Now in its fourth edition, the CPT list of over 7,000 five-digit codes--devised by the American Medical Association at the request of the Health Care Financing Administration (HCFA)--provides a useful method for identifying and billing medical services. Laboratory services are identified by the 80000 series.

CPT had its first effects on the clinical laboratory in 1984. As the Federal Prospective Payment System (PPS) was being implemented for inpatient reimbursement, the CPT coding system was being set in motion for outpatient payment.

Under Medicare and Medicaid regulations, the coding system must be used to identify procedures performed for outpatient reimbursement. If not, Medicare is not obligated to pay.

* Hics-Pics. Because some medical procedures had not been given CPT codes, HCFA added additional codes where needed. These Level II codes form HCFA'S Common Procedural Coding System (HCPCS), commonly known as "Hic-Pics." Some states and carriers have created local Level III HCPCS codes to identify services that do not have CPT or HCPCS designations. All such codes consist of five characters and are used by Medicare and/or Medicaid.

[Paragraph]Level I. CPT code. National. Example: CPT 85376, fibrinogen, thrombin with plasma dilution.

[Paragraph]Level II. Alphanumeric code beginning with letters A through V. National. Example: P9012, cryoprecipitate, each unit.

[Paragraph]Level III. Alphanumeric code beginning with letters W through Z. Local. Example: Y8305 (Colorado), platelet neutralization.

HCFA is phrasing out Level III codes as part of its standardization process for reimbursement. To simplify the transition, most carriers and intermediaries that use Level III codes are cross-referencing them to CPT codes.

Prospective payment regulations call for inpatient services to be reimbursed according to allowable fees in diagnosis related groups (DRGs). An anticipated decrease in revenue from Government payers led laboratorians to hope that private payers would fill the void. Some health care professionals worried so much about inpatient reimbursement that they failed to learn enough about CPT coding for outpatient services.

Now we acknowledge the importance of our outpatient market and how CPT coding affects that income. For example, a pro-thrombin time test for an outpatient whose fees are paid through Medicare must be identified as CPT 85610. Regardless of the laboratory's usual fee, reimbursement is a standard amount for all laboratories in a defined geographicl area. In Utah, for example, #85610 brings $5.37.

Laboratory reimbursement for each CPT-coded procedure is listed on a schedule. The amount varies from one Medicare area to another. Payments under Medicaid tend to be slightly lower. In Texas, for example, the Medicaid fee schedule allows 90% of the amounts reimbursed by Medicare.

Regardless of provider status--hospital, independent laboratory, or POL--Medicare and Medicaid reimbursement remain the same. Most laboratories are paid at the 60th percentile of the median of all national fee schedules. An institution will be reimbursed at the 62nd percentile only if it is classified as a rural hospital, has an emergency department, and offers 24-hour laboratory service seven days a week.

In general, all providers are reimbursed identically according to the lowest of the following fees: charge for test, local fee schedule, or national fee schedule. This is true whether or not the provider participates in the Medicare program. The provider must accept assignment for services and cannot bill the patient for any excess.

In 1990, Medicare alalowed a 4.7% increase in scheduled laboratory reimbursements and then capped payment at 93% of the new amounts. For 1991, amounts on the schedule were increased by 2%. The amount allowed, however, will be capped at the 88% level. The 2% increase also applies to 1992 and 1993, for which no cap has yet been announced.

# posted by Medical Information : 3:24 AM