Coding and Health Care Costs

Health care reimbursement for most services is made via claims filed with a private insurance plan or government plan that covers the patients.  Those claims are required to include codes that describe the combination of the patient’s condition and needs and the services provided by the clinician to treat that condition.  As you might imagine (but government policymakers seem to have trouble understanding) providers are highly motivated to use coding in a way that maximizes reimbursement.  This has led to a decades long battle between providers and their consultants seeking to increase payment and health plans trying to prevent games-playing and limit payment.  When government changes coding, consultants immediately try to help providers figure out how to circumvent any intent to lower reimbursement.  A typical visit to deal with a non-acute payment is often called an evaluation and management visit.  The government, using work done by the American Medical Association, recently revised the guidelines for coding of these visits, which have several levels.  This paper examined what changes in coding occurred following the change in the guidelines.  In a very short period of time, providers began doing reduced coding of less-intensive visits and increased coding of higher-level visits, which led to higher payments.  This constant back and forth, which usually doesn’t achieve the intended goal of reducing reimbursement, is one reason we have so much difficulty in controlling national spending.    (Annals Article)