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Medical Coding News Archives

Low Charges Can Trigger a Review

June 1, 2012:

Wendy Gabbert, CPC, CPC-H, Clinical/Technical Editor

The Centers for Medicare and Medicaid Services announced that, effective October 1, 2012, it will review outpatient prospective payment system (OPPS) claims when the charges billed are lower than the reimbursement. The Office of Inspector General (IOG) recently reviewed these types of claims and found that the discrepancy is often due to providers who report incorrect units of service and/or incorrect HCPCS codes, or who use HCPCS codes that do not reflect the actual procedures performed.

Based on the OIG report, CMS will create an edit to hold claims for review when the OPPS reimbursement is greater than the claim charges. The edit will apply to hospital bill types 12X, 13X, and 14X.

Contractors will contact the hospital to determine if the claim is correct or changes need to be made. If the claim requires correction, it will be returned to the hospital. If it is correct, it will be submitted for processing.

Hospitals can take this opportunity to review their chargemasters for correct codes and adequate charges. With the help of the department managers, hospitals can review each department’s costs and charges and evaluate what is included in the charge for procedures performed. Are there drugs or implants that can be charged for separately? This is also a good chance to review the hospital’s charge entry, billing practices, and coding education. Are the correct number of units being entered for the services, procedures, supplies, and drugs provided? Drug units should be based on the description of the HCPCS codes, not necessarily on how the drug is packaged. If the hospital has a pharmacy computer system separate from the charging and billing system, are the units crossing over to the bill correctly? Are units assigned in HIM crossing over to the bill correctly? Take this opportunity to ensure the units are entered on the final bill correctly.


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