No Margin, No Mission: A Team-Based Approach to Cath Lab Billing

Better documentation and billing practices are key to securing reimbursement, avoiding denials and protecting diminishing margins for catheterization laboratories.

Cardiac catheterization laboratories face daunting economic challenges, with decreasing profit margins that threaten the mission of delivering high-quality care. Providing patients with the latest cardiovascular imaging tools, devices and procedures is expensive. All healthcare facilities, regardless of their nonprofit or for-profit status, must generate sufficient margins to reinvest in these evolving technologies. Yet healthcare operating margins averaged 6.5 percent in 2012, according to the American Hospital Association, and may narrow in the coming years.

A team-based approach

Poor communication across laboratory team members can lead to costly billing mistakes. One organization failed to bill for appropriate instances of imaging supervision and interpretation (S&I) on all procedures for nine years due to one interventionalist’s insistence that S&I codes were “doctors only” billing codes. Better education and communication between the entire clinical team and a dedicated billing specialist might have revealed this costly misunderstanding much earlier.

To cultivate a team-based approach to improved catheterization laboratory documentation and billing, assemble a team with representatives from each discipline within the facility, from the medical director and other physicians to the nurses, technologists, finance/charge master specialists, IT and EMR specialists, office managers and scheduling clerks. Team members should be fully engaged to cultivate a shared understanding of good billing practices via multidisciplinary education.

Billing terminology has its own language; for effective communication, every team member must understand the nuances of billing terms for different procedures and clinical scenarios, as well as other relevant financial terms. Importantly, all team members should understand that reimbursement does not match the full amount that is charged. Instead, facilities may receive a bundled payment, which is adjusted to reflect performance metrics, or a percentage of charges depending on patient status and payer contracts.

Aggregate Total Hospital Margins, Operating Margins and Patient Margins, 1992 –2012
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Source: Avalere Health analysis of American Hospital Association Annual Survey data, 2012, for community hospitals. Total Hospital Margin is calculated as the difference between total net revenue and total expenses divided by total net revenue. Operating Margin is calculated as the difference between operating revenue and total expenses divided by operating revenue. Patient Margin is calculated as the difference between net patient revenue and total expenses divided by net patient revenue.

Revenue cycles also vary across organizations, and processes may change with every upgrade of the EMR system. Financial and/or IT team members can educate other staff about the key features of the institution’s revenue cycle, and how minor variations in documentation and coding may have major downstream effects on collections. To be clear, accurate documentation is absolutely necessary to capture appropriate charges. Clinicians inadvertently can expose themselves and their organizations to either under-capture or over-capture of charges via erroneous documentation. Both scenarios pose major financial risks.

Current projections from the Centers for Medicare & Medicaid Services (CMS) indicate that the new ICD-10 coding will take effect on Oct. 1, 2015, expanding the number of codes from 20,000 to more than 155,000. Cardiac catheterization laboratories have an opportunity to re-educate all staff on key steps of the coding process, from initial diagnosis to claim submission.

One effective strategy to get team members thinking about these issues is to introduce a “Billing and Coding Tip of the Month,” which can be reviewed at each staff meeting.

All team members must understand how their roles and responsibilities affect the financial health of the organization—sometimes down to the smallest details. For instance, nurses and technologists may consistently throw away certain supplies at the end of a case, such as 4x4 gauze pads or sutures from prepackaged procedure kits, or supplies are routinely opened for each case but not always used. This needs to be brought to the attention of their manager and discussed at the next staff meeting.

Better documentation

A recent Accreditation for Cardiovascular Excellence (ACE) study of catheterization laboratories seeking accreditation found a high degree of variability among facilities in their completeness of documentation. In particular, information required to meet the appropriate use criteria (AUC) for diagnostic catheterization and coronary revascularization was frequently missing. Allegations of inappropriate use can be costly; a hospital in the southeast recently agreed to pay more than $40 million to settle a case alleging unnecessary stenting and diagnostic catheterizations.

ACE recommends implementing a stand-alone report that documents all of the information necessary to determine whether a procedure is appropriate. Key information in the report includes how and why the patient presented to the catheterization laboratory; what non-invasive tests were performed and their results; whether the patient is on maximal medical therapy; other pertinent test findings; what procedures were performed; the outcome; and plan for follow-up.

Performing an internal chart audit can help teams understand their own performance regarding documentation, AUC, billing/coding and payment. First, members of the clinical team should verify that AUC metrics and overall procedure details are documented.  Next, a coding specialist can verify that correct diagnosis and procedure codes have been captured based on the documentation. Finally, a member of the finance team can review for appropriate payment. The internal chart review can reveal weaknesses that should be addressed with ongoing multidisciplinary education.

Tools and resources

Several free tools are available to help catheterization laboratories begin the process of improved documentation. The Society for Cardiovascular Angiography and Interventions Quality Improvement Toolkit (SCAI-QIT) includes AUC guidelines, checklists, a mobile and web-based AUC apps and other tools.

Another valuable resource is the 2014 American College of Cardiology, American Heart Association and SCAI health policy statement that endorses new standards for structured reporting of clinical and operational data for cardiovascular procedures. The policy statement also requires catheterization laboratories to report their accreditation status.

In summary, our mission as healthcare providers is to deliver exceptional quality and cost-effective care that is individualized for the needs of each patient to achieve the optimal clinical outcomes. To achieve this mission, we need margins that will allow us to keep our doors open.