October 1 ushers in ICD-10 manual updates annually. Other than the creation and seemingly daily updates to diagnosis coding during COVID-19, the unveiling of this code set arrives each year with little fanfare. That is compared to CPT updates that are unveiled annually on January 1. Perhaps ICD-10 changes garner little concern because the code set by the World Health Organization (WHO), and in the US authorized by WHO to be maintained by the National Center for Health Statistics (NCHS) with added collaborative maintenance by, Centers for Medicare and Medicaid Services (CMS), the American Hospital Association (AHA) and the American Health Information Management Association (AHIMA) are seen as not as impactful to revenue capture. Most coders and billers will chime in with phrases supporting that “we don’t need to be concerned with diagnoses.” In turn, revenue cycle efforts are heavily focused on the procedural and service side of the coding coin.

In 2004, CMS introduced Hierarchical condition category (HCC) coding. The concept is a risk-adjustment model designed to estimate future healthcare costs for patients. HCC coding relies on ICD-10-CM coding to assign risk scores to patients. Other demographic factors are then introduced and the payers assign a risk adjustment factor (RAF) score. It is this RAF score that is then used to predict costs. 

This concept of HCC coding is not applicable to all specialties. Primarily, HCC coding is applicable in hospital (inpatient) coding. Few physician-based (“pro-fee” or outpatient) coding specialties are reimbursed with these metrics. Anesthesia and pain are not under this metric, yet.

Even in the absence of this metric, there is evidence that payers are applying scrutiny to the accuracy of ICD-10 coding. At the beginning of October, a federal judge ordered a payer to address a government lawsuit that claims inaccurate diagnosis data resulted in the payer collecting tens of millions of dollars in overpayment from Medicare annually. The suit was brought about under the False Claims Act. Though the diagnoses were not the exclusive source of reimbursement, the suit brings to notice that the reporting of inaccurate, invalid or deleted codes resulted in the submission of false claims.

Last week AHIMA, in collaboration with the Association of Clinical Documentation Integrity Specialists (ACDIS) released new guidelines for queries. At the foundation for the need to develop this newly introduced guidance is another legal claim from the government. This time against a medical system. In this instance, the claim seeks restitution on the basis that the medical system regularly brought “mined diagnoses” to the attention of physicians with the expectation to add targeted conditions to the patient’s medical record, retrospectively through the query process.  The review of this process by the government demonstrated that diagnoses were added that had nothing to do with the visit, while increasing reimbursement by supporting medical necessity for services that were not initially supported, as identified in an LCD/NCD policy, in addition to HCC payments. 

Taking revenue-based reviews out of the equation, the Agency for Healthcare Research and Quality (AHRQ) which is the federal agency under the U.S. Department of Health and Human Services (HHS), has released reports related to Patient Safety Indicators (PSI). PSIs address potentially avoidable safety events related to in-hospital occurrences. It should come as no surprise; unfavorable and skewed metrics were in part attributed to inaccurate diagnosis code captures. The inaccuracies attributed to coding errors and documentation deficiencies in equitable numbers. 

All of these recent events are indicative that the assignment of diagnoses should not be an afterthought. While the introduction of HCC metrics in our specialties is not currently required, there is evidence that reimbursement is not the sole reason CMS and other payers will evaluate ICD-10 accuracy. The time to evaluate ICD-10 accuracy in coding assignments and reinforce complete, accurate clinical documentation is before these expectations result in unfavorable situations in your practice.   

ACE Expert 
Deena K. Gauthier, CPC, CDEO, CANPC, CGSC
aceadmin@aceauditors.com