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NDHI NAT IONAL DIALOGUE FOR Healthcare Innovation Coding Advisor Organization Overview • Change Healthcare is committed to connecting the dots between payers, providers, and patients, by using data analytics to deliver predictive insights to these clients • Change Healthcare operates the single largest financial and administrative healthcare network in the United States • The company offers a diverse portfolio of solutions to help payers, providers, and pharmacies operate efficiently and effectively Background Care practitioners are reimbursed for assessing and managing patients’ health through a set of Current Procedural Terminology (CPT) codes called “evaluation and management” (E/M). These services represent a significant portion of healthcare billing – 30% of Medicare Part B payments were for E/M codes in 2010. Improper coding for E/M services is a significant concern for payers and puts undue financial burden on the broader healthcare system. The extent of E/M misuse has been the subject of a report published by the Office of Inspector General, which found that: • Medicare paid $6.7 billion in inappropriate E/M claims in 2010 alone Traditionally, insurers often pay out claims before investigating them, due to the short time frames that are legally-required for provider reimbursement, and then conduct post-payment audits. When improper coding occurs, this causes payers to engage in a “pay and chase” model to adjust reimbursement appropriately to providers. Due to the high cost in pursuing low dollar, high-volume claims, payers have historically been unable to effectively pursue these types of overpayments. Product Details Coding Advisor is an innovative platform developed by Change Healthcare to transform payment integrity services for the healthcare payer industry. This product was developed to address the widespread issue of overpayment by insurers due to: • Outlier physician E/M upcoding • Misuse of “modifier 25” for E/M coding • Unit errors associated with high cost injectable “J-Code” billings • 55% of Medicare claims for E/M services were incorrectly coded or lacking documentation in 2010 FOUR PHASE CHANGE IN BEHAVIOR APPROACH PHASE 1 Identify PHASE 2 Educate PHASE 3 Validate PHASE 4 Act CHANGE IN BEHAVIOR • Outlier Identification • Establish Baseline • Outlier Reports • Outreach Calls • Coding Policies • Probe Audits • Document Error Rate • Transactional Messaging • Documentation and Case Summary • SIU Action Plan An Initiative of the 65 | Coding Advisor
NDHI NAT IONAL DIALOGUE FOR Healthcare Innovation Through Coding Advisor, billing behavior is changed through a four phase approach: 1. Identify: Data analytics identify outliers in provider billing practices and establish a baseline 2. Educate: Expert medical coders deliver targeted insights about coding policies and conduct outreach calls to help correct coding errors on a pre-submission basis 3. Validate: Coding Advisor conducts probe audits to determine claims corrections and documents error rates 4. Act: Coding practices are documented and case summaries developed, in order to create action plans The reach of the product has grown rapidly over the last 18 months, with a customer base of 8 payers covering tens of millions of lives. These customers fall across the spectrum of payer types: • Large national commercial payers • Medicare managed care organizations • Medicaid managed care organizations • BCBS plans • Government payers Value Delivered Coding Advisor has successfully improved provider billing practices and resulted in reduced billing costs for customers: • 23.4% average decrease in overbillings • 3.9% average decrease in cost of E/M claims • $200 million saved in total through the end of 2016 • 80% of outlying providers exhibited more accurate billing practices Path Forward Change Healthcare aims to broaden the scope of Coding Advisor and is currently investing significant resources to build out additional content in new areas with high overpayment vulnerability. The modules currently in the design process include: • Behavioral Health • Emergency Department • Hospital DRG • Implants • Other sources of overpayment recovery issues Coding Advisor | 66
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