Neurosurgery Coding Alert

A deeper understanding of medical necessity will help you better support your coding and bolster your claims. Definitions of the term are, unsurprisingly, varied and vague.

However, there is some consensus among various medical institutions, according to Kim Huey, MJ, CPC, CPCO, COC, CHC, CCS-P, PCS, president, KGG Coding and Reimbursement Consulting and Sandy Giangreco Brown, BS, RHIT, CHC, CCS, CCS-P, CPC, CPC-1, COBGC, COC, PCS, director of coding and revenue integrity at CLA in their presentation “Medical Necessity: Defining and Documenting to Support Billing.” To meet the criteria of medical necessity, Huey and Brown explain that services should be:

• In accordance with “accepted standards of medical practice” (AMA);
• “Reasonable and necessary for the diagnosis or treatment of illness or injury” (Medicare);
• “Neither more nor less than what the patient requires at a specific point in time” (American College of Medical Quality); and
• Not for the economic benefit of the health plan, purchaser, provider, or even the patient (AMA).

Diagnostic Tests Provide Valuable Info

Whenever you see diagnostic tests in the provider’s notes, know that proof of medical necessity is required. It might seem obvious to you and the provider that blood work or imaging scans are medically necessary as part of a patient’s condition or treatment plan, but it’s not obvious to the payer.

Documentation: In this case, the provider must document the patient’s symptoms, their medical history, and the rationale for ordering the test in the patient’s medical record. This documentation should serve as evidence of medical necessity, as it should be relevant to the patient’s condition and can help guide their diagnosis and treatment plan.

Look for Preventive Services, too

Certain preventive care services like immunizations, health screenings, and some counseling may require documentation of medical necessity to justify the services being provided to the patient. Typically, this documentation must support that the patient meets the criteria in relevant clinical guidelines.

Know How Medical Necessity Impacts E/M Coding

Medical necessity doesn’t just affect diagnosis and procedure coding. It also plays a major role in submitting the correct E/M codes.

The Centers for Medicare & Medicaid Services (CMS) has always maintained that medical necessity is the fundamental basis of payment. But it’s still a common misconception that since history and physical exam haven’t directly contributed to office/outpatient E/M code selection since 2020, there is no reason to spend time documenting the history and examination. Proving medical necessity is one good reason, however.

When selecting outpatient E/M codes, you must ensure that the chosen codes accurately represent the level of service provided. The chosen level of E/M code, in turn, should match medical decision making or amount of time on the date of the encounter needed to manage the patient’s condition.

Documentation of history, examination, and the decision-making process can all support the medical necessity underlying the level of service reported, and payers may deny reimbursement for services if they believe the E/M code does not align with the medical necessity of the provided services.

Example: If you report 99214 (Office or other outpatient visit for the evaluation and management of an established patient, which requires a medically appropriate history and/or examination and moderate level of medical decision making. When using time for code selection, 30-39 minutes of total time is spent on the date of the encounter.) but the documentation only shows that the patient had a medication recheck, that code will surely raise a red flag to the payer without significantly more information explaining the moderate MDM level or 30- to 39-minute encounter time.

The bottom line: “Tell a story with your documentation. Don’t rely on diagnosis documentation alone. And review any payer medical policies and document in their terms,” said Huey and Brown. Or, to put it another way, follow CMS’ 1995 Documentation Guidelines for Evaluation and Management Services, which state, “If not documented, the rationale for ordering diagnostic and other ancillary services should be easily inferred” (Source: www.cms.gov/outreach-and-education/medicare-learning-network-mln/mlnedwebguide/ downloads/95docguidelines.pdf).