Urology Coding Alert

Don't confuse nursing facilities and skilled nursing facilities

Every claim requires a place-of-service (POS) code, but if you don't choose the correct one, you not only risk losing money but also risk denial of your entire claim.

Choosing the correct POS code is important to every claim and makes a difference in the amount you're reimbursed and whether your claim is paid or denied, says Annette Grady, CPC, CPC-H, CPC-P, CCS-P, TCN senior orthopedic coder and compliance auditor and an executive officer of the AAPC National Advisory Board.

Read on: Steer clear of disaster with our experts' advice on your most pressing -- and confusing -- POS issues.

Decide Between Hospital and Office

If your office is part of a hospital facility, determining which POS code applies may vary "depending on the financial setup between the physician and hospital," Grady says. "CMS does have some other rules for provider-based billing, in which both the physician and hospital bill for the E/M code." The hospital bills a facility portion, and the physician bills a professional portion. In the CMS database, many codes are split with a facility value and nonfacility value.

Helpful: If your office is on hospital grounds, don't report POS 11 (Office) or POS 22 (Outpatient hospital), until you ask yourself the following question: Is the provider paying fair-market rent for the facility (office space)? If so, then consider the space an office and select POS 11.

If you aren't paying fair-market rent, then choose POS 22. Reason: When you aren't paying for use of the facility, you shouldn't receive any extra reimbursement for it. You only earn the higher nonfacility fee (called for by POS 11) if you're paying rent and incurring the other costs of running a practice, namely paying for staff, utilities and supplies.

Payment differences: "POS can change your reimbursement," says Pamela Biffle, CPC, CCS-P, ACS-DE, a PMCC instructor and director of operations/senior instructor for CRN Institute in Salt Lake City. "For example, office versus hospital -- the hospital fees will be lower. Also, there are some services that are only reimbursed when performed in certain POS."

Know the Difference Between Nursing Facilities

If you are billing Part B for services you provide to patients in nursing facilities, there's a lot of room for error when you have to decide among POS 31 (Skilled nursing facility), 32 (Nursing facility), and 33 (Custodial care facility).

Best bet: Check with the facility you're coding for. "The facilities should be able to provide you with their classifications," Biffle says. "It doesn't really matter what they do if they are not classified for that level of service. Some facilities have different units with the different designations."

A facility can have both skilled nursing and non-skilled nursing beds simultaneously.

• 31: You should use skilled nursing facility code 31 when your physician performs tests for a patient who is in a skilled bed at the time of service. This means the patient has a medical condition that requires skilled nursing care, such as injections or ventilation. The facility "must be licensed as an SNF," says Lisa Scott, CPC-OS, president of Elcyes Consulting in Myrtle Beach, S.C.

Important: If an SNF resident is still covered under Part A Medicare, many of the services you may provide are subject to consolidated billing. This means Medicare pays the SNF for most or all of the services provided, including some services the urologist may provide, and you have to contract with the SNF to get paid. For many of these services, you can't bill Medicare directly for the services you provided. You must bill the SNF.

Once the patient exhausts his Part A benefits (having been at the SNF for more than 100 days following discharge from the hospital) or if he fails to meet CMS' Part A level-of-care requirements, the patient returns to a Part B stay and services aren't subject to consolidated billing. You should be able to bill Medicare directly, as long as you have a physician medical referral for a particular nursing home patient.

Note: If a nursing facility brings a patient to your urologist's office, you should report POS code 11 (Office) on the claim form. However, if the patient is also from an SNF, laboratory studies performed in your office (urinalysis, urine culture, PSA), radiological studies (including sonographic procedures), drugs administered by the urologist or his staff (Lupron, Zolodex, testosterone, and antibiotics) and urodynamic studies (technical components only) are examples of services falling under consolidated billing, and you won't get paid by Part B Medicare for those services. You must seek reimbursement for these services from the SNF, which should be billing Medicare for these studies.

• 32: You should choose nursing facility POS code 32 if the patient is not on Part A Medicare but instead is on long-term care and receiving medical, nursing or rehabilitative services.

Because determining what type of bed the patient has can be difficult, you need to maintain close communication with the administrative or billing office in the nursing facility to determine whether the patient is occupying a skilled bed when the provider sees the patient.

• 33: You would report POS code 33 for a custodial care facility -- a facility providing patients with personal assistance services (such as dispensing medications) on a long-term basis but which does not provide medical care. Patients are mobile in a custodial care facility, so be sure there is medical necessity for you to see a patient at the facility rather than in your office.