Pathology/Lab Coding Alert

The Health Care Financing Administration (HCFA) wants to make all claim edits used by Medicare contractors available to the public in the future.

The federal agencys existing commercial contract includes confidential edits that can confound physicians and coders, resulting in rejected claims and expensive, time-consuming appeals. But as the contract nears its expiration on Oct. 1, 2000, We will seek out contracts that do not contain these [confidentiality] restrictions, says HCFA administrator Nancy-Ann Min DeParle.

The medical communitys dilemma over proprietary edits has its roots in an October 1998 decision by HCFA to implement a commercial data-processing product for Medicare claims that contained 241 black box or proprietary edits, licensed from HBOC/McKesson (producers of ClaimCheck code edit software). HCFA is authorized to use the edits, according to DeParle. However, HCFA does not own the edits and is therefore unable to authorize the release of the edits to the AMA [American Medical Association], general public or Medicare provider community without confidentiality or non-disclosure parameters, she says. In short, the pathology community has been expected to comply with these rules to avoid claim denials, even though they cannot access them.

Secret Codes

Laboratories in particular have been plagued by claim denials based on what appears to be one of these black box edits. Evidently, the HBOC software uses an edit that denies claims reporting code 88300 (surgical pathology, gross examination only) with any of the other surgical pathology codes for gross and microscopic examination (88302-88309), states Ron L. Nelson, PA-C, president of Health Services Associates, a practice management and compliance firm located in Fremont, Mich.

Because these codes are not subject to a published edit from HCFAs Correct Coding Initiative (CCI), it is assumed that the HBOC software is the source of the denials. Apparently the edit presumes that the two codes refer to the same specimen, says Nelson. This is problematic for labs, which often conduct a gross examination of one specimen, and a gross and microscopic examination of another specimen from the same patient on the same day. These do not always get reimbursed as separate procedures, claims Nelson.

Tips for Pathologists Left Holding the Bag

This leaves pathologists and coders on their own to determine how to handle the problem. For claims with both 88300 and one of the 88302-88309 codes, some practices have decided to submit only the higher code at this time, says Nelson. Other practices are holding entire claims in hopes of a future solution, although this is clearly impractical if such claims are a common occurrence, he adds.

Some pathologists have protested to their local Medicare carriers, but these contractors also are powerless to act until there is a ruling from HCFA. Fortunately, HCFA officials have indicated that if Medicare eliminates any improper HBOC edits, healthcare providers will be allowed to resubmit claims pertaining to those edits. And although black box edits can be difficult to spot because the denial notices are indistinguishable from those for CCI edits, HCFA sources state that providers can request information regarding the denial and receive a clinical explanation.

The AMA believes the best news may be HCFAs announced intention to avoid proprietary edits in the future. [We] are grateful that Administrator DeParle has heeded our call for more openness in the Medicare program, says AMA Chair Randolph D. Smoak Jr., MD. We look forward to working with HCFA to guarantee there are no more secret rules.