Funding Focus

Equipment and Diagnosis: It Needs to Match

• By Kelly Riley
• Apr 01, 2008

The phone is ringing, the trucks are traveling throughout your service area, and claims are flying through the electronic highways like never before! In addition, revenue is at an all-time high, and the new staff in your intake department really fits in well with the rest of the team. There is only one problem: Your receipts of cash are down. Without an influx of cash, everything else will eventually stop. But now, everyone is looking to the billing department to fix the problem.

Revenue is what is created when we sell or rent an item. Generally speaking, revenue is the amount we expect to receive based on what we enter into our software system. This numerical entry occurs when we enter the various fee schedules from all payor sources. Cash does not enter the equation until we get paid. To ensure that we get paid for products and services, there is a step all too often overlooked: revenue qualification. While this process would be relatively simple for those who came to the HME industry with a health care background, that experience is not generally found in new CSRs.

All too often the scenario plays out like this: The physician’s medical assistant calls your location and orders a nebulizer for a patient. During the intake process, the CSR does a great job of collecting all the required demographics, the health insurance claim number (HICN), a contact person outside of the home and the new physician’s NPI number. When asking for a diagnosis during the intake process, the medical assistant states, “The chart says 426.0.” The medical assistant then relays that she must hang up to help a patient. The CSR enters the information into the system and then prints a ticket to be processed by the delivery team.

The only problem with this scenario is that diagnosis code 426.0 (which is the ICD-9 code for congestive heart failure) does not fall within the range of codes 491.0-508.9 that covers all of the diseases under the grouping of obstructive pulmonary disease. A nebulizer, used to administer various aerosolized medications, is not an indicated treatment for congestive heart failure. While most respiratory therapists, clinicians or billing staff would quickly recognize this code, it is not something easily done by those new to our industry.

According to the Local Coverage Determination (LCD) policies, coverage for a nebulizer is granted when medically necessary to administer albuterol, budesonide, cromolyn, ipratropium, levalbuteral or metaproterenol for the management of COPD. (Note: Nebulizers are indicated in the treatment of other diagnosis codes: 277.0, 042,786.4, 996.80-996.89.)

When the claim does not get paid and is being worked by the Medicare accounts receivables manager, we learn that the patient also has chronic bronchitis (ICD-9 code 491.8). Once this diagnosis code is added to the order by the physician and entered into the claim correctly, then we can be paid.

Another common error occurs when the patient is already in our computer system. Far too often we do not complete the intake process in the same manner as we would with a new patient. The revenue qualification step is again left out. We repeat our history by recognizing the problem only when cleaning up old accounts receivables. This explains why patients show up in our systems having received a walker with a diagnosis of sleep apnea!

Intake forms, at a minimum, should have a place that indicates that the patient’s diagnosis relates to the equipment being ordered and provided. In this business, what is done during the initial steps of accepting a patient affects billing, A/R and the end product. We all need cash.

This article originally appeared in the Respiratory Management April 2008 issue of HME Business.