INTRODUCTION

Medical Necessity is a term that refers to the Medicare policy whereby Medicare coverage is limited to items and services that are reasonable and necessary for the diagnosis or treatment of an illness or injury.

There are two main categories which define “what is allowed and under what circumstances.”

National coverage determinations (NCDs) are made through an evidence-based process, with opportunities for public participation. These policies affect all providers. In the absence of a national coverage policy, an item or service may be covered at the discretion of the Medicare contractors (MAC) based on a local coverage determination (LCD). These policies only affect providers in the geographic region covered by that MAC.

WHAT DOES THIS MEAN IN PLAIN LANGUAGE?

Simply put, there must be medical justification for everything we do to, with, or for a patient. For example, if a patient presented with a headache, dizziness, nausea and vomiting, one would have to question why we did an X-ray of their foot.

But everything is not always so clear. For example, if a patient had a colonoscopy, isn’t it normal to also do a biopsy of the colon? It depends on the provider documentation as recorded in the patient’s medical record. When it comes to medical necessity, provider documentation is everything.

If, during the colonoscopy, the MD documented that she discovered a polyp or cancer or other lesion of the colon, then yes, doing a biopsy would be justified.   However, if the doctor documented the findings of the colonoscopy as “normal,” then there would be zero justification to have performed a biopsy. What happens when there is no documented justification to provide a service? The answer is that we fail medical necessity and we do not get paid.

The next obvious question is “how can we tell” if procedure or treatment X will be allowed (pass medical necessity) according to the Medical Necessity rules? That’s pretty easy too. We can look up the publicly available NCDs and LCDs previously cited for that service or procedure.

Each NCDs and LCDs includes the CPT© code(s) for a service and the corresponding diagnosis code(s) that support coverage of that service. CPT© codes are a numeric value for every possible procedure. For any given procedure, there might a dozen or even scores of qualifying diagnosis codes. Sometimes, a combination of two or more diagnosis codes is required.

WHAT DOES THIS HAVE TO DO WITH ICD-10?

You may already know, or have read, or have heard that CPT© codes will not be impacted at all by the transition from ICD9 to ICD10.  That is correct.  However, the “justification” part of the NCDs and LCDs is based on diagnosis codes, which are only represented by using ICD9 (or soon, under ICD10) codes. So this is a big concern.

HOW TO PROCEED

In preparation for ICD10, NYP wants to know ahead of time if any of the procedures we do, which pass medical necessity edits today, might not do so in the future, under ICD10.

Testing for this starts with a rather “mechanical” process.

First, we rank all of the procedures we do (outpatient) by (a) volume by CPT© code and (b) total annual reimbursement per CPT©. This gives us an idea of where to start by prioritizing our work.

Next, we look at the current NCD/LCD for that particular CPT© code and identify all of the ICD9 diagnosis codes that are listed as “acceptable diagnosis codes” for that procedure.

The third step is convert each ICD9 code listed under that CPT© code’s NCD/LCD into ICD10. Since there are so many more ICD10 diagnosis codes as compared to ICD9, it is fully expected that the number of resulting “converted to” ICD10 diagnosis codes can (and probably will) be much larger than what is listed under ICD9.

Next, we look at the published NCD/LCD policies which have already been “converted” to ICD10 diagnosis code by Medicare or the MACs and compare “their” list to “our” list. We look for discrepancies: what does “our” list include that “their list” does not.

The fifth step involves “back mapping” those ICD10 codes that have been “lost” (will no longer count under the projected NCD/LCS using ICD10) to ICD9 codes.

The next step is create a report of all of the NYP cases which have the “lost” ICD9 code and the CPT© code under scrutiny, and to have them actually coded in ICD10 and see if the ICD10 code produced actually matches the “lost” code or not. If the answer is no, then we can stop because there won’t be a negative impact. But if the answer is yes, then we go to step seven.

Step seven means first adding up all of the cases which will “no longer pass medical necessity” to determine the potential reimbursement impact. If there is a large volume of such cases, we proceed with the “non-mechanical” portion of analysis. We want to further analyze each scenario and see what can be done, if anything, to mitigate the risk of not getting paid in the future for some we have been paid for in the past. This can include feedback with the providers or feedback directly to Medicare or possibly to GNYHA – or maybe to all three.

A LOT OF WORK

Medical necessity is an existing area of risk for NYP and all providers under ICD-9. ICD-10 certainly has the potential to exacerbate that risk as we move towards the implementation date of October 1, 2015. Assessing the impact of that additional risk is a key readiness activity. Mitigating that risk will continue to be of great importance to NYP’s revenue cycle and financial performance.

 

References:

http://www.cms.gov/Medicare/Coverage/DeterminationProcess/

http://www.cms.gov/Medicare/Medicare-Contracting/Medicare-Administrative-Contractors/MedicareAdministrativeContractors.html

http://www.cms.gov/Medicare/Medicare-Contracting/Medicare-Administrative-Contractors/MACJurisdictions.html

203 days to go – The thought of another ICD-10 delay is about as welcome as another snowstorm to cap a dreadful winter in the Northeast. Of course, it was nearly a year ago when the industry, including the Centers for Medicare and Medicaid Services (CMS) themselves, were blindsided by winter storm SGR. This devastating ‘unnatural’ disaster bundled a one year delay to the implementation of ICD-10 with the 17^th consecutive temporary fix to the formula that determines physician payment. As the expiration of that legislation looms it is only natural to be guarded. Today however, we share out latest project update under the sunny skies of a 50 degree March afternoon; a suitable omen for October 1, 2015.

Remember that special congressional hearing on ICD-10 held in February? It happened. And the results were overwhelmingly positive in support of ICD-10. Constituents from across the industry continuum including physician groups, HIM trade associations, insurance carriers, and technology vendors spoke eloquently as to the benefits of moving to a more specific healthcare classification system including its support of other industry initiatives such as meaningful use and value based reimbursement. Here at NYP, the benefits of ICD-10 are obvious as we continue to provide some of the most innovative, elaborate, and compassionate care to patients from around the world. Care that cannot be sufficiently articulated through an ICD-9 classification system approaching its 40^th birthday.

A list of NYP’s most recent and cumulative accomplishments continues to move the organization closer to realizing these benefits with ICD-10 reality just a shade more than six months away.

• Operationalize dual coding.In support of our NYPHS network hospitals, New York Methodist is now providing dual coded claims to our Eagle ICD-10 environment for purposes of claims testing and reimbursement analysis. NYP reinvest in its dual coding activity with 100% of staff coding in ICD-10 expected to begin in April.
• Complete end-to-end claims testing with payers. Our first end-to-end claim submission test to United Healthcare/Oxford continues to mitigate our risk with payers.
• Enable provider support of ICD-10 documentation requirements. Feedback for our Intelligent Medical Object (IMO) based documentation selection tool has been positive and has expanded to 12 physicians. High risk/high variability analyses at the code level are supporting focused education efforts as we prepare providers to document in support of ICD-10 concepts.
• NYPHS readiness.Collaboration continues with NYP providing our network hospitals with a dual coding volume analysis to support its own dual coding activities and ICD-10 readiness.

Other activities will continue to progress and expand under the assumption that no further delays shall occur. For a complete overview of the project status, click here to view the Project Scorecard.

Should you have questions about what you can be doing to get your department ready for ICD-10 or would like to request an in person presentation from the ICD-10 project team, please e-mail ICD10Help@nyp.org.