Date Posted: Wednesday, August 21, 2024

 

While Evaluation and Management (E/M) auditing continues to be the industry favorite for professional medical auditors in this field, there are several reasons and opportunities to audit surgical services.

 

However, even though many surgeons spend a fair amount of office time in consultation with prospective new patients, their E/M activity is often exceeded by the time they spend on-call and performing global surgical services.  This presents an opportunity for medical auditors to take a closer look at surgeons' work.  For auditors who are interested in reviews of surgical services, the overall methodology is the same: random or targeted samples, key elements to validate, and the issuing of an executive summary supported by regulatory guidance with a list of suggested action plans.  Surgical auditors don't need specialty certifications—they need only an understanding of anatomy and terminology and the willingness to research and learn.  With that, here are some common surgical auditing topics.

 

Documentation

 

Compliance plays a part in all aspects of healthcare, including surgical services.  For those providers accepting federal dollars (Medicare or Medicaid), the Code of Federal Regulations outlines the expectation for hospitals and their affiliated providers who render services under the Conditions of Participation.  42 CFR 482.51(b)(1)(i) requires that there be an updated examination of the patient (H&P) completed no more than 30 days prior or 24 hours following the admission or registration for surgery except in certain cases of outpatient procedures.  Additionally, 42 CFR 482.51(b)(2) indicates that properly executed informed consent should be in the patient's chart before surgery, except in emergencies.  Auditors should validate that those documents are located within the patient's chart.

 

Surgical Documentation also has a set of standards to be followed.  CMS Internet-Only Manual 100-07, Medicare's State Operations Manual, provides a list of standards that federal auditors would expect to see during an onsite survey and references 42CFR within this standard. 

 

The operative report must at least include:

 

• Name and hospital identification number of the patient;
• Date and times of the surgery;
• Name(s) of the surgeon(s) and assistants or other practitioners who performed surgical tasks (even when performing those tasks under supervision);
• Pre-operative and post-operative diagnosis;
• Name of the specific surgical procedure(s) performed;
• Type of anesthesia administered;
• Complications, if any;
• A description of techniques, findings, and tissues removed or altered;
• Surgeons or practitioner's name(s) and a description of the specific significant surgical tasks that were conducted by practitioners other than the primary surgeon/practitioner (significant surgical procedures include opening and closing, harvesting grafts, dissecting tissue, removing tissue, implanting devices, altering tissues); and
• Prosthetic devices, grafts, tissues, transplants, or devices implanted, if any.

 

Coding

 

Although coders review most surgical services, their role is to assign the most appropriate CPT code based on the language provided by the surgeon.

 

When auditing surgical services, auditors should ask several questions:

 

• Is this procedure what was originally pre-authorized?
• Did procedural unbundling take place? 
• Were all of the appropriate modifiers appended? 
• Was the correct ICD-10-CM code assigned within the Official Guidelines for Coding and Reporting?
• Were related (or unrelated) services billed during the post-operative global days?  
• Was there a return to the operating room or any complications of care?

 

Often, audits will uncover coding errors that can easily be rectified with education and rebilling. 

 

Billing

 

One of the most helpful aspects of surgical auditing is for the auditor to take a look at the complete revenue cycle, which includes charges and payments. 

 

The auditor should ask:  

 

• When the claim is adjudicated, was the payment appropriate for the procedure reported? 
• Was timely filing met?   
• Were assistant surgeons and/or add-on codes reimbursed? 
• Were contracted or administrative adjustments taken correctly?   
• Were facility-based charges such as supplies or equipment billed incorrectly on the professional bill?
• Were secondary payor reimbursements received? 

 

All of these billing components can impact the practice or department's bottom line, and often, solutions can be as simple as workflow changes or staff education. 

 

Many of these audit elements above are pertinent to the hospitals in which surgeons perform.  Why would that matter for professional services' documentation, coding, and billing?  The reason is that providers are held to the hospital's medical staff rules and are legally obligated to follow the expectations of the hospitals in which they work.  From a professional billing perspective, surgeons can also be financially impacted if payors take back payments for incorrect or inappropriate charging—even if the work is performed outside of the office setting.

 

Coverage and Medical Necessity

 

Another area of surgical audit review is related to the scrutiny placed on providers who are performing services that are addressed in payment policies and coverage articles. CMS and their Local Contractors, along with commercial payors, publish coverage determinations that can be used to validate whether or not medical necessity has been met for services reported for payment.  In many instances, it's not enough to report the covered CPT code along with a medically necessary diagnosis code.  Insurance companies expect that when elective surgeries are performed, there has been clear documentation of previous conservative treatment and that the patient's clinical status is at a level where the surgical service in question is medically appropriate.  For example, prior to performing a total knee replacement, Medicare expects to see chart documentation that illustrates that the patient has experienced a program of physical therapy, a series of therapeutic joint injections, and a course of OTC medications prior to having made the decision for surgery.  Without that information in the chart and in an external audit, Medicare could (and does) recoup payments.  An audit of this sort of medical necessity is important so that when TPE or RAC audits are performed, you've already made the recommendations and set the expectations so that your surgeons are bulletproof.

 

By Pam Warren, MHA, COC, CPC, Fellow 

 

Pam has over 33 years of experience in healthcare, having worked in billing, coding, practice management, compliance, and auditing.  She has led coding, auditing, and clinical documentation improvement teams and currently works as the manager for Regulatory Billing Audit and MaineHealth, Northern New England's largest healthcare system. She earned a BS in Adult Education and Workplace Training from Granite State College and her Masters in Health Administration from St. Joseph's College of Maine.  She has served multiple times as an officer for the Seacoast Dover NH Chapter and is currently a member of the Portland, Maine Chapter.  She is a well-known local, regional, and national speaker for AAPC on a variety of healthcare business and career development topics.  She served from 2013-2016 as the Region 1 Representative for AAPC's Local Chapter Board of Directors and also served from 2018-2021 on AAPC's National Advisory Board.  She earned her AAPC Fellowship in 2016, sits on the Education Committee for HealthCon, and is a frequent contributor to Healthcare Business Monthly.

 

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