The Ten Commandments of E/M Coding

By Stephen C. Spain, MD, FAAFP, CPC

Evaluation and management (E/M) services are likely the most regulated and most often audited services in medical practices. These services can account for more than half of a provider’s income, so it is crucial that they are appropriately documented and coded. A casual approach to E/M coding can result in both improper reimbursement and embarrassing audits. Professional coders in medical practices have a duty and responsibility to ensure that E/M services are properly coded. In order to ensure correct E/M billing, the documentation must meet certain minimum tests. Each of these “10 Commandments” reflects an area integral to uncontestable documentation and coding. Coders can use this list to assess the records found in their workplace, and then address areas of concern with providers.

Evaluation and Management – CEMC

1. The Documentation Must be Legible

Legibility is the bedrock of a medical record. Obviously, if a record cannot be read or interpreted, it is of little value. This does not mean that the record must be meticulously written. There are many providers whose handwriting falls far short of perfection. However, with a little help, the coder or auditor should be able to handily decipher the provider’s documentation. Dictated or computer generated records can be a great benefit in this area, although they are not without their pitfalls, as outlined below.

2. Every Record Will Contain Basic Data

Each record must contain the patient name, patient birth date, the encounter date and time, vital signs, allergies, and the location of the service. The nurses or medical assistants of a practice should be trained to record these as they assess the patient. Upon completion, every record must be signed by the provider, whose printed name should also be a part of the record.

  3. The Record Will be Organized

Haphazard documentation makes the record difficult to follow and can lead to coding errors. Providers should have learned in their training how to logically generate a medical record. Encounters should follow the format of: chief complaint, history, exam, and diagnosis/plan. The history (HPI) must be broken down into the review of systems (ROS) and the past, family, and social history (PFSH) in order to be properly evaluated for coding purposes.

4. Documentation Matches the Billed Services

Unfortunately, it is not uncommon for providers to list several of a patient’s past and active diagnoses on a superbill or in the record, when the record documents care for only one or two of them. Every billed service and its corresponding diagnosis code must be clearly documented in the medical record. For example, if the provider is relying upon the evaluation of two stable medical problems to support a level 4 encounter, then the pertinent history and exam for each of the problems must be found in the record.

  5. Medical Decision Making (MDM) Must Match Service Level

MDM is the overriding determinant of the level of service, and a billed service level should never exceed the MDM reflected in the documentation. Be familiar with your Medicare intermediary’s criteria for evaluation of MDM and apply those criteria stringently to your provider’s records. If you meet Medicare criteria consistently, then the records should easily fulfill criteria for private insurers.

6. Addendums or Alterations are Properly Documented

The integrity of the medical record is paramount, and can only be protected by the strict adherence to rules regarding timely completion and proper notation of late changes. Ideally, an encounter should be fully and completely documented within eight hours, and certainly no more than 24 hours after the service. Additions to a completed record should be clearly labeled as such, and include the date, time and reason for the addendum. When making a late addendum, it is preferable to place it on a separate page from the original document to avoid the impression that the author was attempting to alter the original record.

7. Do Not Clone Medical Records

Cloning medical records refers to the abusive use of boilerplate data, or carrying forward large portions of a patient’s prior record to the current encounter. When documentation is “cloned,” it implies that information is inserted into the record that has not genuinely been elicited from the current encounter. Cloning usually occurs in the context of using an electronic medical record. Detecting and eliminating the practice of medical record cloning is part of the OIG work plan. Be sure your providers are aware of this potential pitfall and avoid the temptation to build a comprehensive evaluation using mouse clicks.

  8. Modifier 25 is not Abused

Some providers improperly bill an encounter code appended with modifier 25 with every procedural service. This is proper only when a separately identifiable E/M service is performed. The E/M service can relate to the procedural service, but it must represent service above and beyond what is normally included in the procedure. For example, an established patient presenting for routine cryotherapy of warts would probably not qualify for an E/M service. However, a new patient presenting for the same problem would need an E/M service to take the initial history and perform an initial physical examination.

9. The Necessity of Ancillary Testing is Clear

When testing or procedures are part of the encounter, the reason and necessity for these items must be clearly documented or intuitively obvious to medical personnel. A Pap smear is understandably part of a routine gynecological examination, and does not need special documentation. However, in many cases, it may take a few words of explanation to clarify why certain tests were included in the encounter. While “rule out” diagnoses are not valid to submit for billing purposes, they can be used in the text of the record to explain the need for testing.

10. Time-Based Encounters

When time-based billing is used, there are several criteria that must be documented in the record. A simple statement that over 50 percent of time was spent in consultation with the patient is required, as well as the total number of minutes spent “face-to-face” with the patient. The subject matter of the counseling should also be recorded in adequate detail to support the amount of counseling time.

These 10 Commandments cover the most important facets required for precise E/M coding. Adhering to these principles will help ensure that your practice’s documentation and coding is sound and able to withstand payer scrutiny. Proper coding is possible only when the provider has a clear understanding of documentation requirements, and cooperates closely with the coding professional to ensure that the billed encounter is coded correctly. The best, most accurate coding will always be the result of providers and coders working together to ensure the medical record conforms to both CPT® and payer standards.

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