• Home
    • » e-Newsletters

Disrupting the status quo: Hospital outpatient coding and ICD-10-PCS

JustCoding News: Outpatient, August 6, 2014

Want to receive articles like this one in your inbox? Subscribe to JustCoding News: Outpatient!

"Sometimes the questions are complicated and the answers are simple." –Dr. Seuss
This quote seemed an appropriate way to begin a discussion about outpatient encounters and ICD-10-PCS.
You see, outpatient procedures will still be coded using CPT®/HCPCS—the HIPAA-approved code set for reporting hospital outpatient procedures—regardless of when ICD-10 is implemented.
Although ICD-10-PCS codes may not be required for outpatient procedures, many payers are expected to begin using them in the outpatient arena. That's not the only reason hospitals should plan to assign ICD-10-PCS codes for outpatient services.
The complicated question in this scenario is: If ICD-10-PCS is not necessary, why the debate? Why should we bother assigning codes when we don't have to?
Answering such complicated questions with a simplistic notion (e.g., CPT/HCPCS is currently the HIPAA-required code set) reflects short-term thinking.
The entire ICD-10 system was designed to improve clinical communication via modernization and standardization of codes and descriptions. ICD-10-PCS provides additional specificity to describe the science behind the procedures, allowing for exact anatomical specification along with the diagnosis to provide data that is uniquely described and coded.
Furthermore, ICD-10-PCS integrates with technology such as EHR, CDI tracking software, and computer-assisted coding programs, making it a better fit for advances in these areas.
Those who are interested in using ICD-10-PCS in their outpatient coding may question whether using both code sets simultaneously will decrease coder productivity.
While this may indeed cause some productivity reductions (in fact, most expect productivity reductions across all departments as teams begin to implement ICD-10), cross-training outpatient coders on the ICD-10-PCS coding process has a number of benefits, including:
  • Inter-coder reliability: Ensuring that both sides of the coding workforce maintain high-level skill sets needed for ICD-10 implementation
  • Management of coding schedules and interchangeability of coding staff: Having fully educated coding and CDI teams makes it easier to fill in during times of unexpected staffing shortages that many facilities expect come ICD-10 implementation
  • Successful cultivation of a fresh coding workforce into the industry with primary knowledge of both ICD-10-CM and ICD-10-PCS
Training time and money diverted from outpatient coders now could require later investment as priorities shift and new ICD-10-PCS expectations arise. However, training them without expecting them to use their skills will end up depleting their abilities and, again, could cause the facility to retrain them later.
ICD-10-PCS is an impressive data set that provides a level of detail that will benefit population health. Training our outpatient coders on ICD-10-PCS is in our best interests. Therefore, HIM managers should not make the decision based solely on productivity and time.
Deciding to train outpatient coders on ICD-10-PCS requires an allied decision with support from the ICD-10 steering committee, medical director and physicians, and others.
Below I offer answers to tip the scales in favor of reporting outpatient procedures with ICD-10-PCS, capitalizing on your internal data analytic functions.
It is essential to normalize your internal data within the hospital/hospital system walls for population health management. There was an average of 2,105 outpatient visits per 1,000 people in 2011, according to Irving Levin Associates' 2012 Health Care Services Acquisition Report. Such a swing in volume from inpatient to outpatient services will play a role in how hospital value-based purchasing program measures develop over the next few years.
CMS is increasingly bundling outpatient encounters by claim level through APC Comprehensive Payment. In the 2014 OPPS proposed rule, CMS proposed 29 Comprehensive APCs for device-dependent APCs. After reviewing comments from providers and looking at additional data, CMS reconfigured these into 28 Comprehensive APCs in the 2015 OPPS proposed rule.
The 2015 OPPS proposed rule includes some lower-cost device-dependent APCs and two new APCs for other procedures and technologies that are either largely device dependent or represent single session services with multiple components.
The Comprehensive APC will include a single payment for the provision of a primary service and all adjunct services provided to support the delivery of the primary service. This includes all services, tests, and procedures bundled into one payment.
This payment includes:
  • Diagnostic procedures
  • Laboratory and pathology tests
  • Other diagnostic tests—e.g., radiology, pulmonary, cardiology
  • Treatments that assist in the delivery of the primary procedure—e.g., preoperative, intraoperative, recovery, PACU
  • Visits and evaluations associated with the procedure
  • Coded and uncoded services and supplies used—e.g., observation
  • Blood and blood products
  • Outpatient department services delivered by therapists
  • Supplies and devices provided as part of the outpatient service—e.g., implants, tissue expander
  • Durable medical equipment such as prosthetic and orthotic items and supplies
  • Any other components reported by HCPCS codes that are provided during the comprehensive service
The proposal also includes a complexity adjustment. This adjustment is applied when a primary procedure assigned to a Comprehensive APC is reported with other specified procedures also assigned to Comprehensive APCs or with a specified packaged add-on code. When the facility reports one of these combinations, CMS will increase the payable APC to the next higher APC in the clinical group, similar to DRGs on the inpatient side.
Although hospital outpatient departments rely on CPT/HCPCS codes, assigning ICD-10-PCS codes enhances data mining opportunities, since each code character describes a specific variable that can assist with financial predictive modeling.
The fourth character indicates right, left, or bilateral, the fifth indicates the approach, the sixth the device, etc.
Such data pinpoints financial variables such as resources (e.g., time in operating room, observation, recovery) and implants (type, manufacturer, laterality, cost).
Isolating financial outliers, payers, surgeons, type device/implant, laterality, and other resources will enable hospitals to perform predictive financial modeling now and for future endeavors. Improved data reporting and analysis by payers and providers will, in turn, improve reporting, mining, and tracking of population health management programs.
Robust procedure data on the outpatient side can be incorporated into hospital quality, safety, and prevention, providing the facility with a better overall performance record as it relates to patient outcomes.
You don't need to cloud integration of ICD-10-PCS assignments for hospital outpatient encounters with complicated statistics and formulas. The highest outpatient charges, regardless of payer, include same-day surgery, interventional radiology, and cardiology procedures, either electively scheduled or through observation services.
With a cohesive approach to a complicated question, it is amazing how simple the answers can be.
"You're off to great places! Today is your day! Your mountain is waiting, so get on your way!"
Click here to find out more!Editor’s note: Andrea Clark, RHIA, CCS, CPC-H, of Plantation, Florida, has more than 30 years of experience working with hospitals, payers, and other organizations.
This article was originally published in Briefings on APCs. Email your questions to editor Steven Andrews at sandrews@hcpro.com.

Want to receive articles like this one in your inbox? Subscribe to JustCoding News: Outpatient!