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How Medical Necessity Disputes Cause Hospitals

to Leave Revenue on the Table

Proper Documentation Before Claim Denials Is the Only Antidote

Medical necessity dis- ing checklist can guide cli- care but possibly not need- tional to the providers
putes are causing hospi- nicians and their leaders in ing to stay past two mid- in actively guiding bet-
tals to leave revenue on good documentation prac- nights, this must be explic- ter documentation in
the table. tices. At a minimum, itly documented. the future and can also
Hospitals are already providers should ensure 6) Daily progress notes allow the immediate
facing increased financial that they clearly document must be sufficiently correction of inadequa-
pressures as care moves the following elements for detailed to clearly show the cies of documentation
outside of facility-based each hospital observation or need for the continued hos- prior to claims submis-
models and more of admission. pitalization and the reasons sion so that denials are
them adjust to value- 1) While EMRs have for each service provided. reduced.
based reimbursement. automated and created Providers should ask them- Engaging an external
Added to that, payers prompts for many docu- selves if a third-party team with expertise in
under financial pressure mentation requirements, a provider would agree that clinical documentation
themselves because of BY KAREN MEADOR, resulting new problem has the hospitalization and Alfredo Cepero and reduction of claims
rising healthcare costs, MD been the increased lack of services are needed based denials can ease the bur-
are scrutinizing claims distinctive patient notes. on documentation. den on leadership and
through increased medical necessity Therefore, it is essential that providers 7) Nursing, respiratory staff and often will iden-
denials with hospitals. avoid the overuse of templates and make therapy, physical therapy tify areas of needed
Providers and health systems denied sure they have typed information that and other care team notes improvement that may
reimbursement for care by a payer can clearly distinguishes notes between also contribute to the story be overlooked when
successfully appeal or ultimately litigate patients. of what care is provided doing an internal evalu-
such disputes in many cases. But internal 2) The order for observation or admis- and the reasons for it. ation.
costs, and legal and consultant fees in sion must include the diagnosis and be However, the notes by the When ongoing docu-
support of the appeals and litigation signed by a physician with a legible sig- physicians or midlevels mentation education
process can be costly, and revenue can be nature or electronic signature and with a need to be able to stand and reviews are done
degraded during the appeals and litiga- date and time. alone in supporting the internally, an external
tion process. Providers and health sys- 3) Orders for labs, procedures and need for continued hospi- team should conduct an
tems can take steps, however, to reduce medications must be signed by a physi- talization. Angelo Pirozzi annual risk assessment
the frequency of care ending up in dis- cian or midlevel (as the scope of practice 8)Discharge notes should and chart documenta-
pute—and proper documentation before allows in the particular state) with a leg- again clearly articulate the reasons for tion audit. A feedback session should fol-
litigation is key. ible signature or electronic signature and admission, as well as the key services low, with a detailed action plan to correct
Incomplete or ineffective documenta- a date and time. provided during the hospitalization that the identified deficiencies in documenta-
tion is a frequent cause of denials. It has 4) All notes must be legibly signed, required the patient to remain hospital- tion and to enhance the processes that
often been said in healthcare, “If it wasn’t dated and timed by the provider with ized up until the time of discharge. support good documentation.
documented, it wasn’t done.” That’s true, regular evidence throughout the hospi- Health system leadership needs to
but perhaps even more relevant in today’s talization of physician oversight docu- ensure that their providers know the Karen Meador is managing director and
healthcare world, “if it wasn’t document- mented in physician signed notes. expectations for documentation, that the senior physician executive in The BDO
ed, it may be considered medically 5) The admit note must clearly EMR system prompts the key documen- Center for Healthcare Excellence &
unnecessary,” resulting in denied payer describe the patient’s condition and doc- tation items without creating too much Innovation. She can be reached at
reimbursement. In fact, CMS could even ument the reasons for hospitalization, duplication and that compensation kmeador@bdo.com.
consider billing for that service to be a the particular level of care required and incentives align with goals for appropri-
false claim. Furthermore, poor documen- the expected length of stay. If the patient ate documentation with fewer denials. Our South Florida healthcare leaders are
tation provides a weak defense in med- is hospitalized as a full admission, the Annual training sessions with regula- ready to address your complex and unique
ical liability cases. expectation of the patient requiring a tory and compliance updates equip and needs:
I have learned valuable lessons from stay crossing two midnights needs to be remind the providers about documenta- Alfredo Cepero, Managing Partner
evaluating thousands of medical documented. Or, on the rare occasion tion requirements. Regular internal chart (305) 420-8006/ acepero@bdo.com
records—including hundreds that have that a patient in a highly acute situation sampling and reviews prior to claims Angelo Pirozzi, Partner
risen to the litigation phase. The follow- requires inpatient or even intensive-level submission to the payer are also educa- (646) 520-2870 / apirozzi@bdo.com

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South Florida Hospital News southfloridahospitalnews.com June 2018 9