Dictation templates improve coding accuracy in an academic dermatology practice.

Beyond the basic logistical issues surrounding the battle for laboratory reimbursement are a number of issues that pertain to the rules of engagement. This chapter discusses the rules set forth by third-party payors that determine claim payment. Criteria for conditions of coverage for laboratory services historically have as their bases a number of elements such as evidence-based-medicine element and medical-ethics element. The coding requirements for claim transactions have been standardized under the Health Insurance Portability and Accountability Act (HIPAA); the Centers for Medicare and Medicaid Services (CMS) require submission of all standard code and transaction sets. The chapter describes certain special coverage conditions for which unique billing rules may apply. In the Medicare program, special rules apply, particularly in the setting of end-stage renal disease (ESRD) and its management in dialysis centers and in payment for laboratory services in Part A skilled-nursing facilities (SNF). Medical-necessity edits have been developed that specify both the procedures performed and the reason for performing the procedures on a given date of service. These edits when developed and applied nationally are known as national coverage determinations (NCDs) or local coverage determinations (LCDs) when developed by individual contractors on local policies. Careful review of these remittance documents provides a mechanism to identify billing problems that are costly in terms of both uncompensated labor and lost revenue. The most common reasons for claims denial include lack of medical-necessity documentation, the fact that the service performed is noncovered, inadequacy or lack of basic identifying documentation, and incorrect coding.

Rules and Regulations in Reimbursement

This chapter illustrates the importance of hiring individuals well versed in all aspects of correct coding, including the rules and regulations. It discusses the importance of having a comprehensive information technology platform and software resources that ensure accuracy and completeness. The chapter explains the need for laboratory personnel to be involved in the billing process and to maintain a close working relationship with members of the billing department and the relationship between complete and accurate billing and the generation of sufficient income to continue to perform expected functions. An understanding of the specific requirements for billing laboratory services and a systematic approach for ensuring that the processes are carried out as specified are key to the financial success of a laboratory. While the entire laboratory test process from test order to test result reporting to payment for services involves several categories of individuals, the actual billing process can be considered in terms of two main categories: provider mix and payor mix. Each individual payor sets criteria for payment for services. Both Medicare and Medicaid are third-party payors; payment for services provided by a healthcare provider to a patient is made by a contracted entity. Each payor may interact with each provider through one of two main types of payments: retrospective and prospective. Claims for payment are generated for submission to thirdparty payors, while invoices are generated for contractual payment by clients or by patients.

Approaches to Billing Laboratory Services

Effective CDM management not only minimizes revenue losses due to denied claims, but also helps eliminate administrative costs associated with correcting coding errors. Accountability for CDM management should be assigned to a single individual, who ideally reports to the CFO or high-level finance director. If your organization is prone to making billing errors due to CDM deficiencies, you should consider purchasing CDM software to help you manage your CDM.

Michael Alwell

Papers

Stem revenue losses with effective CDM management.