Computerized Tools: Taking the Mystery Out of Coding, Billing, and Reimbursement



When Jeffrey H. Oppenheimer, MD, a neurosurgeon in suburban New Orleans, was a member of a group practice, one of his partners found piles of unopened explanations of benefits (EOBs) stuffed in a billing clerk's desk drawer. So, when he started his own practice, he wanted to be sure that he was as protected as possible from employee error and negligence. After searching for an office practice management system that would give him peace of mind, he decided to subscribe to athenahealth (, a Web-based vendor that provides billing and collections services for physician practices.

Oppenheimer, who has been in solo practice for 5 years and has been using athenahealth for the past 3 years, said, "The best thing is that this system is embezzlement-proof. Insurance checks are deposited directly into a third-party lockbox. I can then wire-transfer the money into the bank once it is posted. The streamlined process frees up billing employees to deal with more urgent matters."

Oppenheimer also has taken other steps to prevent reimbursement losses. He does his own coding and, along with members of his office, attends the coding courses offered by the American Association of Neurological Surgeons (AANS) on a regular basis. "We need to be good coders ourselves and to educate our staff. If we delegate all this responsibility, there will be all kinds of errors," he said.

Manual diagnostic coding leaves much more room for human error than automated systems. Numbers scribbled on an encounter form, circled from a truncated list, or written in text form and subject to random interpretation by billing staff may end up looking very different from the intended diagnosis. Most payer claims processing systems contain claim adjudication features that reject incongruent International Clinical Disease-9 Clinical Modification (ICD-9-CM) and Current Procedural Terminology (CPT) codes. For example, when procedure codes for electromyography are automatically checked against diagnostic codes during processing, a simple numeric transposition error that changes 354.0 (carpal tunnel syndrome) to 345.0 (generalized nonconvulsive epilepsy) automatically triggers a denial. Without a vigilant staff or a computerized system that alerts physicians to error, payment for services may be delayed or left unpaid.

"No one but the doctor seeing the patient really knows the details of the diagnosis," said Laura B. Powers, MD, chair of the American Academy of Neurology (AAN) Medical Economics and Management Subcommittee. She shares a group neurology practice in Knoxville, TN, with 7 colleagues and has been teaching coding courses and speaking on behalf of the AAN for new diagnostic codes and clarifications and improvements to the current codes for the past 12 years.

"Unless the doctor writes the entire description required to choose the fourth and fifth digits for many of our diagnostic codes, the office personnel choosing the ICD-9-CM code will have to either come back to get more information or use a nonspecific code, which may be denied," she said. "Either outcome can cost the practice money."

"I have always spoken against superbills [charge slips with evaluation and management (E&M) codes and ICD-9-CM codes]. . . . They are fine for subspecialists who see only a limited number of codes and can have a list of all the possible codes on 1 sheet. But for general neurologists, there are just too many codes used in the office to list on 1 sheet, or even 2. There are also long-term economic implications for using the most precise codes possible," Powers added. "ICD- 9-CM is used for morbidity and mortality data. Using the right code can help us justify the need for financial assistance to further the treatment of neurologic diseases and help neurologic researchers get reliable data on the US population."


Most experts agree that automating the coding process reduces error. When Craig T. Williams first stepped into his role of administrator/director for the Departments of Neurosurgery and Neurology at the Brigham and Women's Hospital 3 years ago, he discovered that the departments had lost 1 month's worth of in-patient billing in a manual system that required doctors to jot down all their hospital visits on index cards. The physicians had to rely on recall to document their daily rounding activities. "Some could not remember very much at all," observed Williams, who realized immediately that a more reliable approach was necessary.

"To avoid filling out information again, the doctors tended to keep their cards until the patient was discharged, sometimes delaying claim submissions for 30 days and adding up to thousands of dollars in delays," he explained. "Moreover, when the cards were brought back, they were held up further by office staff tasked with matching the patient in-house days for concordance with length of stay. Then, they were sent across town in an interoffice envelope where they would sit in a bin until they were keyed into the billing system. In addition to cards never being turned in, imagine all the places along the way for them to get lost."

To avoid lost charges, Williams began using PatientKeeper (, a mobile charge capture application that the department's neurologists use on a Pocket PC Hewlett Packard Ipaq HX2750. After 1 year, he has seen an increase in in- patient charges of 20% and a 50% decrease of days in accounts receivable. "The census is uploaded onto the handhelds so that when neurologists are making rounds, their patient lists are readily available. They can then look up patient prescription information, recent laboratory reports, and radiology images. The first time they see a patient, they create a charge and select the appropriate E&M code from the system, which has been preloaded with the most common CPT and ICD-9 codes. The ICD-9 system has already been configured from the billing records to display those patients' most recent diagnostic codes. The efficiency is even greater the next day, when only follow-up codes need to be selected," he explained. Currently, the information needs to be synchronized at a base station, but Williams plans to use a wireless network that will allow the charges to upload automatically to their billing system, IDX.

Williams, the current secretary of the Business and Research Administrators in Neurology Society (BRAINS), which is affiliated with the AAN (for information, go to brains.cfm), is dedicated to improving practice reimbursement. Hoping to achieve an even greater reduction in bill-processing time in the accounts receivable department, he is currently piloting a trial period in which residents have been supplied with the PatientKeeper system, thinking that the residents will be comfortable with the technology later on. He anticipates that their experience and ultimate buy-in will help prevent lost charges even more. Williams also notes that the application's built-in intelligence feature is able to prompt physicians when they inadvertently omit information or make a mistake. For example, it may ask, "Do you want to add a modifier?" or "Is this part of the surgical global period, or are you evaluating the patient for an unrelated complaint?"

Oppenheimer also appreciates the value of having a product with a rules engine. "Athenahealth tells you if you are making a mistake as it is running," he said. "Over time, the software accumulates payer rules, and as it evolves, it 'learns' from denials and improves its performance. When rejections do occur, it offers templates for rebuttal letters." In addition, the system checks eligibility information, referrals, and reimbursement requirements and flags problems for the office staff to review. It tracks claims, posts payments, notes nonpayments, and immediately follows up on unpaid claims.


In larger groups, it is often difficult to convince all member physicians to adopt new technologies at once. Laurence J. Adams, Jr, MD, a neurologist working in a combined neurology/neurosurgery group with 9 physicians in Colorado Springs, CO, began to use a new integrated practice management and electronic medical record (EMR) program, eClinicalWorks (, a few months ago. "I am able to easily choose the right diagnosis code and billing level after I complete my note," he said. The E&M coder prevents underbilling by analyzing the documentation and recommends the appropriate visit level. The system is then able to reconcile patient encounters systematically to ensure that all charges have been recorded for all visits. Likewise, such tools can help prevent overbilling--and risk of audit failures and fines--by pointing out areas of deficiencies in documentation and allowing providers to add information omitted from the record.

"The cost of this integrated product is less expensive than our previous practice management system alone," Adams noted. A self-proclaimed technophobe who does not even own a home computer, he admits, "I am extraordinarily pleased with the results. . . . By using voice recognition for our notes and getting rid of our transcription fees, we have been able to save about $6000 per month." His practice manager estimates an additional savings of $3000 per month in postage, paper supplies, and equipment.

Adams' enthusiasm quickly attracted the interest of his associates; after 1 year, "seven others are using the system fully and the eighth is coming along," he said. Like athenahealth, eClinicalWorks PM is a Web-based application that allows practices to submit claims electronically; it also soon will confirm patient eligibility and determine which services will be covered. The system includes a scheduling program, scanning and document management module, prescribing application, and handheld capability to chart at the point of care. Since Adams' practice is now e-filing claims, it has seen a significant improvement in the revenue stream because claims can be turned around in as little as a few days, rather than weeks or months, which was the case when they were filed by hand.

William Henderson, the practice administrator for Upstate Neurology Consultants in Albany, NY, has seen a marked improvement in efficiency since the practice adopted new information systems. His 5-physician neurology practice uses Intergy software from WebMD ( One application that translates into big-time savings has been document scanning and storage capabilities. An increasingly popular digital solution, document imaging and management systems (DIMS) provides a way to consolidate information from unmanageable quantities of paper to easily accessible electronic files for future viewing.

"All explanations of benefits are scanned by date posted. Not only has this saved considerable shelf space, it is now possible to search for an EOB within seconds," he said. "Billing staff can view the exact statements that patients receive when they need to discuss payment issues with them. And by using electronic billing features with Envoy's clearing house, staff can see claim rejection reasons on the Internet and resubmit the bills directly from those Web pages."

The quest for the right billing and practice management system requires planning and patience. When Bonnie A. Francisco, administrator for a large neurosurgical practice in Minneapolis, began her search, she engaged in a 1-year study of the vendor market, reviewing her practice needs and specific products. She checked whether applications were compliant with various current regulatory requirements such as those of the Health Insurance Portability and Accountability Act. She narrowed her search to vendors who provided local support, concerned that out-of-state support would be less accessible.


After approaching all departments in the neurosurgical office and asking them to create a wish list of functionalities that would improve their individual tasks and make them more efficient, she created a request for a proposal. Defining her practice requirements in writing ultimately forced vendors to respond to a consistent set of questions. Francisco invited 3 vendors to perform in-house demonstrations for various departments and asked the departments to rate the products' capabilities. She then took key staff members, including operations managers, business office managers, and department heads responsible for transcription and medical records, as well as medical secretaries and front-desk personnel, on site visits to investigate systems. They asked tough questions about product functionalities, user training experience, ease of the conversion process, and satisfaction with customer support.

They ultimately decided that their practice would benefit from a product that would be fully integrated with an EMR, one that demonstrated ease of reporting functions, provided prescription tracking and telephone messaging, and included a scheduling module with all providers' appointments-at-a-glance, insurance card scanners, label printers, and direct-fax capability. They selected NextGen (, a product that most closely matched their needs. The due diligence displayed by Francisco during this project earned her the "better performer" distinction in accounts receivables and collections from the Medical Group Management Association (MGMA) for the second year in a row. Like many practice administrators who are dedicated to improving operations, Francisco uses MGMA benchmarks and other resources.


Several consulting firms specialize in advising medical practices in their search for office systems. KLAS enterprises (, for example, supplies performance reports for many practice management and EMR systems. Its online database classifies products by category of function and practice size and reports on a standard series of vendor and product performance measures. It relies heavily on user experience and translates the feedback into rating scales and report cards. It allows practices to screen prospective vendors and review peer-generated reports to narrow selections to those vendors performing at a required level. With literally thousands of practice management products available--and many of them destined to fail--independent consulting firms provide resources through which practices can make more informed decisions about their purchases.

Barbara P. Hurlbert, CmpE, who has worked in health care management for 34 years and has served as practice administrator for Lyerly Neurosurgical Associates in Jacksonville, FL, for the past 9 years, has seen a great evolution in billing, a transition from paper ledger systems to computerized products. She has experience with more than a dozen practice management systems and believes that technology should be adopted incrementally. She said, "It is not something that should be done overnight but is best undertaken in baby steps."

Hurlbert is the president-elect of the Neurosurgery Executives' Resource, Values and Education Society (NERVES), established by the AANS and the Congress of Neurological Surgeons (CNS). She has been actively involved in the business education of AANS and the CNS member physicians and staff. In a presentation delivered at the 2005 AANS annual meeting in New Orleans in April titled "A Neurosurgery Administrator's Journey to EMR and Digital Technology," she advised, "Your vendor will not baby-sit you during an installation with a practice management system or an EMR. To get the best results, you have to tailor the product for the needs of your practice, and that requires a high level of sophistication from managers."

Lyerly uses the Misys Tiger Billing System (www. with the interfaced software that has a correct coding initiative built in. Lyerly physicians do the coding themselves before charge data are entered. Like most practices that have sought to achieve a seamless workflow, Lyerly uses an integrated billing and charting system.


For those who have not yet interfaced their systems, several Web-based resources can help with diagnostic coding. Powers recommends the "Official Guidelines for Coding and Reporting," found at nchs/datawh/ftpserv/ftpicd9/ftpicd9.htm, and says that it is a quick read. The AAN offers a search engine for ICD-9-CM codes that includes an alphabetic search, a numeric search, and a stroke appendix for the rather difficult-to-navigate cerebrovascular disease section (

Most practices today are struggling with higher overhead and working longer hours to maintain the bottom line. It is more essential than ever to ensure that each encounter is correctly billed and properly reimbursed. As Oppenheimer said, "The majority of us already take discounted fees from payers. It is criminal not to collect money that is rightfully ours." *

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