General Surgery Coding Alert

For a variety of reasons, many general surgeons pay scant attention to the documentation supporting the evaluation and management (E/M) services they perform. But with improved documentation, if your surgeons were able to report one level of service higher to match what the documentation, properly written, actually supports, they could earn $40,000 or more annually without fear of audit, coding experts say.

General surgeons often complain they are working harder and making less money than ever, says Arlene Morrow, CPC, a general surgery coding and reimbursement specialist in Tampa, Fla. I hear this every day from the surgeons I work with, Morrow says, and I always tell them the same thing: The only area of medical practice in which increased payment is possible is E/M; it just isnt happening in surgery. So they need to invest their time in something that will yield a return.

M. Trayser Dunaway, MD, a general surgeon in Camden, S.C., and author of Pocket Guide to Clinical Coding, concurs. I noticed I was being paid less and less for procedures and more for E/M and paperwork. So surgeons should take their lead from that.

Take an Active Role

Getting paid more for E/M doesnt just happen, however, Morrow says. To accomplish this, surgeons need to take an active role in determining and documenting the level of E/M they provide to their patients. But general surgeons have not been trained in this area, Dunaway says. We go in and say to ourselves, How tricky was this? It was more than a level one, but not the trickiest (level five), and then basically choose among levels two, three and four, based on a feeling about how much time is spent with the patient and how sick he or she is. And we or our office often will undercode just to avoid an audit, he says. If the documentation we write down doesnt support a higher level of code, our staff can just code what they see.

Not only is undercoding a poor reimbursement strategy, in some cases it results in fines being levied against physicians for not providing (or not documenting that they provided) adequate care to patients.

The good news is, documenting correctly doesnt necessarily mean documenting more. In many instances, surgeons may be able to document less, but do it better. Many surgeons believe that documenting correctly involves more paperwork, but usually, its the opposite, Morrow says. Physicians tend not to give concise documentation. The fact is, if they format their documentation, often it will cut down both on the time spent documenting and on the high cost of transcribing the documentation. For example, she says, a large 50-surgeon practice spent $500,000 annually on transcription, but when they switched to using dictation templates, they cut costs in half.

Dunaway agrees that if surgeons want to bill the correct code for the E/M services they provide, they have to learn what to document and what to eliminate as extraneous that doesnt earn any points. But for many surgeons, he notes, doing that will involve more documentation than they are used to providing. In the past, surgeons used an H&P [history and physical] just to get the patient into the operating room, and nobody was overly concerned about documentation. Surgeons can still do that today, of course, but they wont get any financial credit for it.

The demands for greater documentation have prompted a variety of responses from surgeons, Dunaway says. Some surgeons have been doing their own documentation for years, serving themselves and their patients perfectly well. Now they are confused by the new, complicated reporting guidelines. Others throw up their hands and tacitly decide not to bother with documentation and forego being paid correctly for E/M. Some surgeons, meanwhile, take the opposite approach and write incredibly long histories of a present illness that still may not boost levels of E/M service because they neglect required elements.

These responses are counterproductive from a payment standpoint. If you know what you need to document, then thats all you need to put down, Dunaway notes.

Four Simple Documentation Guidelines

E/M services are comprised of three components: history, examination and medical decision-making. Decision-making is the crucial factor when determining the level of visit that should be billed, but only if the documentation of the history and examination components supports it.

Surgeons, due to the nature of their work, often treat very ill patients (for example, individuals with heart and lung disease who will be under general anesthesia). Although the level of decision-making in such cases seems straightforward for the surgeon, according to E/M guidelines, they are anything but.

Surgeons tend to mention only what they think is pertinent to the patients current problem. For example, if they remove a patients gallbladder, they may forget to mention that the patient also has hypertension, diabetes and coronary disease, unless these conditions become problematic during the surgery, says Dunaway. In fact, these conditions contribute greatly to the level of medical decision-making.

Guideline No. 1:
Decision-Making Is the Key

Although the three elements of an E/M visithistory, examination and medical decision-makingare intertwined, the level of decision-making determines the kind of exam and history the surgeon performs on the patient. For outpatients, there are four levels of decision-makingstraightforward, low complexity, moderate complexity and high complexityand each corresponds to a certain level E/M code. Level one and two E/M codes, for example, require straightforward medical decision-making, whereas level three codes require low complexity; level four codes, moderate; and level five codes, high complexity. Inpatient E/M codes have only three categories: low, moderate and high.

Note: The word straightforward, in this context, can be misleading. What the surgeon considers straightforward may, in fact, be decision-making of low, moderate or even high complexity.

To calculate the correct level of medical decision-making, three categories must be considered:

Number of diagnoses or management options.
Tests and records reviewed or ordered.
Amount of risk to the patient.

Each category then is broken down. The number of diagnoses, other problems, and management options is either minor (one problem); low (two); moderate (three); or high (four). Similarly, the amount of data reviewed, ordered or to be ordered is either minimal (zero to one test or record); limited (two); moderate (three); or extensive (four or more).

The third component involves evaluating the risk to the patient, which again is graded either as minimal, low, moderate or high. Risk is a tricky thing because its relative, Dunaway says. You can give me an adult who is bleeding. To me, as a surgeon, this is not risky, whereas a two-month-old baby with a temperature of 104 would be risky to me. A pediatrician, on the other hand, probably wouldnt think so. In other words, Dunaway says, physicians often will underestimate the risk to the patient when treating within their own specialties because they are so familiar with the problems.

To gauge risk objectively by the Health Care Financing Administration (HCFA) and American Medical Association (AMA) standards, Dunaway urges physicians to use Medicares Table of Risk because it conforms to the published standards (see Table 1 on page 20).

The Table of Risk includes common clinical examples (e.g., prescription drug management or elective major surgery) and is divided into three sections (presenting problems, diagnostic procedures ordered and management options selected). The sections in the table should not be confused with decision-makings three components. The key thing to remember about the table is that the highest level in any one of its sections determines the entire level of risk. In other words, if the patient presents with only one problem and only minor diagnostic procedures are ordered (both minimal) but prescription drug management (moderate) is the management option, the overall risk level is moderate.

All these guidelines, categories and subcategories may seem intimidating and confusing, but if they are viewed simply as a systematized way of reporting what surgeons regularly do when they see patients, they are much easier to understand.

Scenario: If a new male patient has an inguinal hernia, hypertension and diabetes, the three diagnoses alone fulfill the requirement for moderate diagnosis/ management options (level four decision-making). The surgeon then orders two tests, CBC and chem screen. Two tests qualify only as limited (level three) in the tests ordered or reviewed component. (Because both the CBC and chem screen are clinical lab tests, they may qualify only as minimal [level two].) This category is only one of three, however, and only two of three categories are needed to qualify for a specific level of decision-making.

Risk, the third category, is quickly determined by checking the Table of Risk (see Table 1 on, page 20). Because the patient is scheduled for elective major surgery and also has hypertension and diabetes, which qualify as identified risk factors, risk is deemed high in the management/options category. This automatically qualifies the entire risk component as high (level five) because the highest level in any one of the three sections in the table determines all the risk.

Note: Major elective surgery with no identifiable risk factors and prescription drug management is deemed moderate risk.

To Review: When the three components of medical decision-making are calculated together for this example, the results translate to decision-making of moderate complexity (level four). Why? Lets review the three components of decision-making. The diagnosis/ management options component was moderate; the amount of data reviewed or ordered was limited (or minimal), and the risk was deemed high. Because two of the three categories either match or exceed the requirements for moderate decision-making, that is the correct level (see Table 2 below).

Now that a moderate level of decision-making has been determined, a comprehensive history and exam are required to bill the visit as a level four service (see following sections). But this, too, usually is part of the surgeons normal routine in a level four situation.

How to Document Decision-Making

For many surgeons, the problem is not the decision-making requirements themselves, but the fact that they must be documented. But this also isnt quite as complicated as it appears. All the surgeon requires is a record of what was ordered and reviewed, with all the patients problems written down. Viewed this way, the requirement shouldnt demand much additional effort on the surgeons part because they gather all this information routinely anyway.

Neither HCFA nor private carriers dictate the form or style of the documentation; surgeons can use standardized forms (see the example on page 24) to note the elements that constitute their decision-making. They can customize a form of their own that conforms to their own way of practicing, or they can dictate, perhaps using a form as a guide, to make sure they dont miss anything.

In the inserted form, the first section, Impressions, would be used to note diagnoses and management options. The second and third sections note reviewed and ordered tests and other data. And the third section, titled Plan, conforms to the Table of Risk.

If such a form has been completed correctly, all the documentation requirements for the decision-making component have been fulfilled.

Morrow notes that determining the level of decision-making always has been the hardest job for coders who arent clinically trained. But if the documentation is on the record, at least the coder has some tools for calculating the type of decisions the surgeon had to make. Doctors typically have to talk about the treatment plan or recommendations, and on that basis coders can gauge level of complexity of decision-making, Morrow says.

For his part, Dunaway urges surgeons to determine their own E/M levels, in particular, the level of medical decision-making. This allows coders to do what they do best, namely, procedural coding.

Coders shouldnt waste their time determining E/M levels when physicians already have all the information about the patient and the treatment plan themselves, he says.

Six Additional Tips on Medical Decision-Making

In addition to reviewing the information on medical decision-making outlined above, general surgeons should consider these six additional tips:

1. All diagnoses listed should be accompanied by a descriptive term such as improved or worsening. If a definitive diagnosis cannot be reached, possible, probable or rule out diagnoses also should be listed.

2. Problems that are improving or resolved require less decision making than problems that are worsening or failing to change as expected.

3. The need to seek advice from others is an indication of complexity of decision-making. If the surgeon decides to make a referral, request a consultation, or seek advice, clearly indicate in the record to whom and for what this decision is directed.

4. Statements such as WBC elevated or chest x-ray unremarkable could indicate that a test has been reviewed. Listing the data without mentioning whether it is normal or out of range is not recommended. Some commentary should accompany that type of information.

5. List the location and date of any separate lab or x-ray reports in the documentation, and initial and date the report to indicate when the information was reviewed.

6. Include a note to specify any findings related to reviewing old records or additional information from other family members. If nothing else relevant was found, note that. Do not list old records reviewed or additional history obtained without elaborating on what was found.

Finally, surgeons should remember that time is not a factor when it comes to determining the complexity of medical decision-making. The surgeon may make a snap decision about how to treat the patient, Dunaway says, but years of training and experience underlie the decision and, ultimately, that is what the surgeon gets paid for.

Guideline No. 2:
Patient Questionnaire Fulfills History Requirement

A high level of medical decision-making usually means that a thorough history should be taken, and surgeons normally do this. But because they tend to be focused on the patients condition and dont want to waste time on other matters, the patients complete history doesnt always end up in the documentation. This may cause no harm to the patient but certainly will hurt the surgeon financially because without the appropriate level of history, a high level E/M service cant be billed.

For example, if the documentation of the hernia patient discussed earlier shows moderate decision-making (level four) and a comprehensive exam (level five) but only a problem-focused history (level one), all the surgeon can report is a 99201 (about $40) because of the low level of history. But the same visit with a comprehensive history (which probably was taken but not documented appropriately) could have been reported with a 99204 (about $130).

Physicians complain about the amount of documentation and choose to just code low so that their documentation doesnt get questioned. Meanwhile, they complain that they dont have enough money to pay their bills. I tell them to consider this: You are willing to work 20 minutes for $30, but wont work 22 minutes to make $60, says Susan Callaway-Stradley, CPC, CCS-P, a independent coding consultant and educator in North Augusta, S.C.

On the other hand, surgeons dont want to spend an inordinate amount of time taking a patients history. One way surgeons can get around this quandary is to give each patient a history questionnaire that they can fill out for themselves. (If the patient is unable to complete the questionnaire alone, office staff can help, Morrow says.) The questionnaire should include three sections: 1) chief complaint/history of present illness (HPI); 2) past/family/social history; and 3) review of systems.

Section one of the questionnaire should let the patient describe:

Location/site of the chief complaint
Quality of the problem (for example, sharp or dull pain)
Severity of the problem (e.g., mild, moderate or extreme)
Timing (during exercise, at night, etc.)
Context (worsening or recurrent)
Modifying factors (heat/cold, rest or limb elevation)
Associated signs or symptoms

If one, two or three of the above elements are described by the patient, the history of present illness is classified as brief; four or more elements constitute an extended HPI. These classifications, in turn, are components in determining the type of history that was taken (see Table 3 below).

Section two should ask about:

Past medical history (illnesses, operations, injuries, treatments, etc.)
Family history (medical events and heredity)
Social history (marital status, occupation, habits, activities and sexual history)

If no medical, family or social history is indicated, the history will be limited to levels one and two.

Section three constitutes the review of systems and should include a series of questions that help to identify any signs or symptoms that the patient may be experiencing. This will help the surgeon determine any underlying problems related to the chief complaint and identify any ongoing problems that might affect a choice of treatment for the current problem.

Medicare guidelines cite 14 elements in the review of systems, and 10 or more are required to document a complete review of symptoms. If you have documented the system(s) related to the problems, however, and there are no other significant findings in the other systems, a notation all other systems negative in the record fulfills this requirement and individual listings of all the systems is not necessary. If this statement is not present, then at least 10 systems must be separately documented to fulfill the requirement for a complete systems review (necessary for a comprehensive history, level four or five E/M). Alternatively, two to nine systems must be documented to describe an extended systems review (necessary for a detailed history, level three E/M).

Once the information about the three elements has been gathered, the level of history can be calculated using the chart below.

After the patient has completed the form, the surgeon should review it with the patient and then sign it. On the form, or in a separate dictation, the surgeon also should:

Note that the history was discussed with the patient.
Indicate what the significant findings were. For example, the dictation might state that patient has
family history of gastrointestinal disorders. By discussing the findings, the surgeon gets credit for
everything on the questionnaire, regardless of its length, including review of systems and past, family and social history.
Specifically note the chief complaint, which is a requirement for any level of history. Without a chief complaint, an auditor has no way of knowing why the patient was treated, Dunaway says. Surgeons are taught to make intuitive jumps. But on paper these kind of jumps arent obvious to an auditor.

Guideline No. 3:
Document the Entire Exam

After taking a patients history, surgeons often back into examinations with a suspicion, if not a medical decision, about the patients condition already in mind. The surgeon is likely to do a fairly thorough examination of the patient nonetheless. However, many surgeons tend to dictate only what they see that is abnormal and leave out anything they examined that does not impact on the patients condition.

But Medicare guidelines require a thorough written record of the entire exam, not just the abnormal results. Medicare, however, does give physicians a choice of guidelines: Either the 1995 or 1997 HCFA E/M guidelines can be used to determine the level of examination. These guidelines differ substantially, and in most cases, it is easier to report a higher level exam using the 1995 rules. Both sets of guidelines, however, are based on the same basic concept: In a multisystem exam, the human body is divided into 14 systems or body areas, each having a certain number of elements (often referred to as bullets because the elements are described in the 1997 E/M guidelines preceded by bullets). For example, the gastrointestinal, or abdominal system, has five elements:

Exam of abdomen with notation of presence of masses or tenderness.
Exam of liver and spleen.
Exam for presence or absence of hernia.
Exam of anus, perineum and rectum, including sphincter tone, presence of hemorrhoids, rectal masses.
Obtain stool sample for occult blood test when indicated.

The other 13 systems also have varying numbers of elements.

According to the 1997 guidelines, all levels of examination, from problem focused (the simplest) to comprehensive (the most complex) require a specific number of elements, or bullets, whereas the 1995 guidelines count body systems. A problem-focused exam, for example, requires one to five elements (1997) or one organ system (1995); an expanded problem-focused exam requires six bullets (1997) or two to five systems (1995); a detailed exam requires either two elements from each of six systems or 12 elements in two or more systems (1997), or six to eight organ systems (1995); and a comprehensive exam requires at least two elements from at least nine systems (1997) or nine to 13 organ systems (1995). The level of exam, in turn, is one of the components in the determination of the E/M service level the surgeon may charge. A problem-focused exam, for instance, rates only a level one E/M; expanded problem-focused, level two; detailed, level three; and comprehensive, levels four and five.

Note: Medicares complete 1995 and 1997 Evaluation and Management Guidelines can be downloaded at http://www.hcfa.gov/medicare/mcarpti.htm.

Given the kind of patient the general surgeon typically sees, he or she reasonably will provide many detailed or comprehensive exams. If the surgeon only documents abnormal findings and doesnt mention the other elements that are examined and found normal (as is often the case), however, then the exam, and hence the E/M service, cant be valued according to its real worth. Consequently, the level of E/M charged will be lower than it should have been.

Surgeons need to document everything they do during an exam and justify it in terms of medical necessity, just like any other medical service they provide, Morrow says. We know they are doing the work, but often they fail to share the knowledge of what they did and only mention things that are abnormal or pertinent. If they would document everything that actually occurred during the exam, it would be easy just to code from the documentation.

Although that may sound like a lot of paperwork, Morrow suggests that surgeons obtain a sample examination form and customize it to their own way of doing things. That way, normal findings simply can be checked off, whereas abnormal results can be checked and then described in a remarks section. Once a surgeon becomes comfortable working with such a system, all the documentation required to correctly code the level of E/M examination can be found on the form (and also is available in the event of an audit).

Whatever system the surgeon decides to use, the resulting documentation is far preferable from a reimbursement standpoint to noting only abnormal findings and consequently underdocumenting E/M services.

Note: Increased reimbursement is not the only reason to better document both history and examinations. Ultimately, the surgeon, not the patients primary care physician, is responsible for patients both during and after surgery. If something goes wrong either intraoperatively or postoperatively, surgeons could face liability problems. Many patients have not had a recent physical and are Medicare-aged, with many contributing health factors that could influence intraoperative and postoperative care. So carefully examining the patient and taking a thorough history also may have positive consequences in terms of liability as well as payment.

Guideline No. 4:
If You Document Correctly, You Neednt Fear Audit

Many surgeons deliberately undercode the E/M services they provide because they fear a future audit. But with correct documentation, this fear is unfounded, Dunaway says. Many surgeons in my seminars tell me they are worried that if they suddenly boost a lot of their E/M services up a level or two by following correct documentation and coding procedures, they would be, in effect, waving a red flag and inviting auditors into their practices.

Dunaway agrees that a dramatic increase in E/M charges likely would draw the attention of many carriers. But if you are documenting medical necessity, and correctly documenting what you did, you should wave that red flag. The auditors will come, and examine chart after chart, and what are they going to find? Beautiful documentation that supports the code. They will then move on to someone elses charts because yours will be unproductive for them.