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Tag Archives: Denials

The Top 3 Reasons for Radiology Claims Denials and How to Avoid Them

The goal of a well-managed radiology billing operation is to submit claims for services promptly and receive reimbursement as quickly as possible. Timely submission and prompt payment enhance the practice’s cash flow and keep the overall cost of billing at a minimum.  All too often, however, payment is delayed because the payer denies the claim for some reason. 

Medical Billing and Coding Blog

How to Avoid Radiology Claims Denials – Eligibility Problems

Claims for reimbursement of radiology services are most often denied by the payer, whether it is Medicare or a commercial insurance company, because they contain inaccurate information about the patient’s eligibility for coverage. This can occur for many reasons, some of which may not be within the control of the radiology practice, but it usually can be corrected by improving the process of recording data at the time of patient registration. In this new healthcare economy where radiology practices are under pressure to add value to the patient care delivery system, effective management of claims denials can strengthen the relationship between the practice or imaging center and the hospitals they serve.

Medical Billing and Coding Blog

How to Avoid Radiology Claims Denials – Authorization

This article continues our series focusing on how to avoid radiology claims denials. In our first article, we covered Patient Eligibility Problems.  Now let’s look at the topic of procedure authorization, specifically the failure to obtain proper authorization before the service is performed.

Medical Billing and Coding Blog

All I Want for Christmas is Fewer RAC Denials

This December, coders across the country got the ultimate Christmas present: a bill passed the House and Senate without the addition of language that would further delay ICD-10 implementation.  As we breathe a sigh of relief and get ready for a worry-free Christmas (at least as far as coding is concerned), we aren’t fully exhaling until the end of March when the SGR bill comes up again for a vote.

But how many people are aware that there is another type of legislation at work that could cut down on the number of RAC denials we get?  Sounds almost too good to be true, doesn’t it?  While the legislation is real, it’s in very draft form right now.  Unfortunately, from where I sit, it also seems to be flying very low under the radar among my peers and I think it deserves some attention.
First of all, if you are not yet familiar with RACs, those are the Recovery Audit Contractors hired by Medicare to recoup improper payments to hospitals and physicians and return that money – with penalties – to the Medicare program.  The idea is great – run all the claims data through proprietary software and analyze it to see what looks weird.  This can be anything from improperly coded claims to admitting a patient to the hospital for a short stay rather than treating them as an outpatient.  Side note: contrary to what a lot of Medicare patients are told, hospitals do not get paid more for outpatient claims; they actually get paid less.  Medicare patients pay more out of pocket for hospital outpatient services and in most cases, hospitals get paid less than if patients were inpatient.  But if hospitals admit patients who could be treated as outpatients for short stays, they can have to pay the money back plus RAC penalties.
There are two types of RAC audits: automated and complex.  Automated reviews can be identified just by looking at data without reviewing the medical record.  Complex reviews require review of the medical record (e.g., for coding errors).  But the RACs don’t have the final say; there is a rather lengthy appeals process that providers can – and should – take advantage of because several RAC denials have been overturned.  The problem is, there are about eight levels of appeals that end with the administrative law judge and currently there is a backlog of appeals at the administrative law judge level.
Enter the Hospital Improvements for Payment (HIP) act of 2014 (don’t you just love that so many healthcare laws start with “hip?!”).  This is a draft proposal aimed at reducing RAC audit backlogs by creating a new Hospital Prospective Payment System (HPPS) for Medicare short stays (less than 3 days length of stay), including observation services.  In short, it calls for the following;
  • Creation of the new HPPS by the year 2020
  • Creation of an alternate reimbursement system for short stays from fiscal year 2016 to fiscal year 2019 as data is gathered for the 2020 system
  • Elimination of RAC reviews for short hospital stays until HPPS is implemented
By now, there may be a lot of people jumping up and down with joy, but of course there is a catch.  The proposal calls for dual submission of claims by hospitals in fiscal year 2016 in order to establish payments.  This means that hospitals would have to submit both ICD-10-PCS and CPT codes for short hospital stays for 2016.  Yes, the proposal assumes that we will be coding ICD-10-PCS in fiscal year 2016, which incidentally, begins on October 1, 2015.  The proposal would also implement an ICD-10-PCS to CPT crosswalk.  If the dual coding of claims didn’t make you nervous, the crosswalk should.  I’ve never met a crosswalk I trusted.  Let’s face it, if one coding system easily crosswalked to another, then we wouldn’t need two different coding systems, would we?  I can see lots of operational challenges starting with the productivity dive that would surely occur and ending with training challenges since it’s getting harder to find inpatient coders who code CPT and many facilities have decided not to train their outpatient coders in ICD-10-PCS.
Read All About It
This is just a small snipit of what HIP is about, but I encourage you to read up on it yourself, starting with information from the House Committee on Ways and Means and checking out the industry commentary to see where you stand.  Here are some links you should check out:
Let Your Voice be Heard

For more information from the House Ways and Means Committee, including information on submitting comments, click here.  This proposal has the potential to rock the world of hospital reimbursement (again) and has some definite pros and cons.  While it’s still only a draft and is not a done deal, it’s time to take the opportunity to let our voices be heard and submit comments.

Coder Coach

ICD-10: Preventing Medical Necessity Denials

Originally Posted in ICD-10 Monitor

Given the added specificity inherent in ICD-10, it’s no surprise that medical necessity denials for physician practices and medical groups are expected to increase throughout 2016. In addition to greater levels of code granularity, three key industry drivers are expected to impact ICD-10 coding compliance among physician practices in the year ahead.

First, payers will continue to refine coverage policies based on the new code set. Second, the ICD-10 grace period for physician practices comes to a close as of Oct. 1, 2016. And finally, almost 6,000 new ICD-10 codes will be added that same day as the partial code freeze concludes. These factors will impact all providers, but they will be especially notable within physician practices and medical groups. 

Practices are also predicted to struggle with reporting ICD-10-CM diagnosis codes that aren’t medically necessary as it pertains to supporting the corresponding CPT codes. Without proactive planning, the following three specialties may see an increase in medical necessity denials in the months ahead: 

• Cardiology
• Pathology/Laboratory
• Radiology

    This article takes a closer look at these specialties to identify common medical necessity gaps in physician documentation and clinical coding. Left open, these gaps carry the potential to increase denials, audits, and revenue loss in 2016. 


    Cardiology Concerns 

    With 42 national coverage determinations (NCDs), cardiology is both a high-volume and a high-value service line. While CPT and E&M codes prevail in cardiology claims, the correct assignment of an ICD-10 code drives medical necessity decisions through NCDs. Some cardiology practices are already experiencing medical necessity denials related to the following: 

    • Unspecified codes
    • Incomplete codes
    • Use of services for specific diagnoses

      Specific concerns for cardiology include incorrect documentation for certain common conditions. To ensure accurate assignment of codes, documentation must support the specificity of each code category. 

      Hypertension: While ICD-10 has only one code for chronic hypertension (I10), there are more specific codes required for hypertension caused by another disease. To ensure accuracy of code assignment, make sure the causal relationship is clearly documented (i.e. pulmonary hypertension, renal hypertension, etc.). 

      Acute MI: Acute myocardial infarctions (AMIs) must include documentation stating “acute” for four weeks from the time of the initial MI. For subsequent AMIs occurring within the four-week period of the initial MI, physicians must also document the four-week period and note that it is a subsequent AMI. 

      Congestive heart failure: For heart failure, be sure to document the type (acute, chronic, acute on chronic) and severity (systolic, diastolic, combined systolic on diastolic). 

      Atherosclerosis with angina: For atherosclerosis, be sure to document the cause of the atherosclerosis, whether the condition is stable or unstable, the artery involved, and whether the artery is native or autologous. If there is a bypass graft, also document the graft, the original location of the graft, and whether it is autologous or biologic.

      Ischemic cardiomyopathy: The diagnosis of ischemic cardiomyopathy must also state the type (dilated/congestive, obstructive or nonobstructive, hypertrophic), location (endocarditis, right ventricle), and the cause (congenital or alcohol). 

      Valvular heart disease: When documenting disease of heart valve, be sure to specify the cause (rheumatic or non-rheumatic), type (prolapse, insufficiency, regurgitation, incompetence, stenosis), and location (mitral valve, aortic valve).


      Common Radiology Pathology and Lab Errors in Practice

      Pathology, lab, and radiology services are all impacted by the laterality specificity required in ICD-10-CM diagnosis coding. It is imperative that the provider document whether diagnostic services are being performed on the left, right, or bilateral sides to ensure the most specific code assignment. 

      Providers should also note that ICD-10-PCS impacts code assignment for the inpatient component of radiology and pathology. All documentation for radiology and pathology procedures must meet the increased specificity required for these procedures. Procedures must also match the specificity in the professional (physician) component CPT code as well. 


      Three More Medical Necessity “Gotchas” 

      Diabetes, neoplasms, and pain codes are also key areas for medical necessity concerns in ICD-10.

      There are five category codes for diabetes mellitus in ICD-10-CM. Diabetes due to underlying conditions, category E08, requires clear documentation of the underlying condition as follows. This includes hyperosmolarity, ketoacidosis, kidney complications, ophthalmic complications, neurological complications, circulatory complications, other specified complications, and unspecified complications and w/o complications. 

      E08 – Diabetes mellitus due to underlying conditions
      E09 – Drug or chemical-induced diabetes mellitus
      E10 – Type 1 diabetes mellitus
      E11 – Type 2 diabetes mellitus
      E13 – Other specified diabetes mellitus 


      Many neoplasm codes require more specific locations of the neoplasm and laterality specificity. One example is malignant neoplasm of the breast. Note that the gender must be documented for accurate assignment of code category for breast cancer as well. 

      In ICD-10-CM, the documentation for pain requires more specificity for location of pain (specific extremity such as arm, leg, finger, etc.), area of the pain in the specific extremity (forearm, upper arm, etc.), and laterality (left, right, bilateral). 


      Pain in right upper arm


      Pain in left upper arm


      Pain in unspecified upper arm


      Pain in right forearm


      Pain in left forearm


      Pain in unspecified forearm


      Eight Proactive Steps to Take

      Ultimately, the goal is to prevent medical necessity denials before they occur, rather than chasing them down after claims rejections or denials. Consider the following eight steps to mitigate medical necessity denials in physician practices and medical groups.

      Focus on clinical documentation improvement—answer the “why:” The importance of CDI cannot be understated. The goal for each physician encounter note is to answer the “why” of every visit, every procedure, and every test.

      CDI should be embedded in each practice’s workflow from the time the patient registers for an appointment through the actual encounter and during the billing period. This includes training on ICD-10 documentation requirements for front-office staff, all providers who document in the record, and back-end staff. As ICD-10 denials occur, be sure to disseminate this information, along with documentation improvement tips, to providers by specialty. 

      Track unspecified codes: Perform a detailed review of all unspecified codes. Is an unspecified code clinically appropriate, or could the physician have documented greater specificity? Physician documentation should demonstrate diagnostic severity and specific patient outcomes to support appropriate ICD-10-CM code assignment. Unspecified codes are predicted to be a key target for payor denials in 2016 as the grace period for physician practices comes to a close. 

      Monitor and update NCDs and LCDs: This is an ongoing process that practices must maintain consistently to ensure that all coverage requirements are met and documented. Review annually for high-volume procedures. To find more information about NCDs for your specific region, go online to

      Work with your EMR vendor: When possible, build (or enhance) electronic medical record (EMR) templates to encourage greater specificity in clinical documentation for each visit, diagnosis, procedure, and test. For example, for coding pain, specific extremity, location, and laterality must be coded, as mentioned above. 

      Review all pre-authorizations and referrals: Ensure that any orders for ancillary testing include specific ICD-10-CM codes that meet medical necessity requirements. Check with your hospital counterparts to make sure that accurate information is received from the ordering provider. Lack of sufficient physician documentation for ancillary testing and procedures is a top concern for all providers. 

      One teaching hospital in the Midwest experienced continued medical necessity denials for outpatient services in cardiology, radiology, and laboratory, resulting in significant write-offs and lost revenue. Poor quality physician documentation on outpatient testing orders was identified as the primary culprit.  

      Know your payor policies: Many payor claims processing guidelines have changed with ICD-10, resulting in increased rejections and requiring providers to keep close tabs on denials. The most frequently reported reasons for denials include:

      • Invalid ICD-10 code
      • Nonspecific ICD-10 code
      • Lack of medical necessity for procedure performed
      • Patient ineligible for service 

        Revisit payer policies for your most common diagnoses, procedures, and testing.


        Monitor medical necessity denials closely: When a medical necessity denial occurs, track the specific reason for the denial as well as the specialty, clinician, and payor. Share this data with the entire clinical, coding, and billing teams within your practice or medical group. Conduct targeted documentation and coding education to highlight what documentation was missing. Finally, when educational efforts are complete, conduct audits to gauge overall improvement in medical necessity denial rates for each specific diagnosis or procedure. 


        The Road Ahead 

        Going forward, physician practices must devote ample time and resources to combat medical necessity denials. While it’s true that the potential for medical necessity denials is greater in ICD-10, consistent implementation of solid processes for denial mitigation across your physician practice or medical group is a smart strategy.  


        About the Author

        Daria Bonner, CHCA, CCP, RMC, chief training officer for Medical Management Institute, has more than 22 years of healthcare industry advisory consulting and project management experience. Her areas of expertise encompass the public and the private sector, hospitals, outpatient service centers, and large and small physician practices. Dari is an expert in commercial and VHA healthcare business process analysis, process modeling, project management, software product development, product implementation, and healthcare information technology. Dari has served as a project director for multiple management-consulting firms, including Booz Allen Hamilton, QuadraMed, Inc., and Ingenix. 

        The Medical Management Institute – MMI – Medical Coding News & MMI Updates