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Coding Audits That Matter: An Investment Worth Making
By Kimberly Janet Carr, RHIT, CCS, and Renée Brown, RHIT, CCS

On the journey to revenue integrity, coding matters. So much is lost when coding is incorrect or incomplete. Consistent, regularly scheduled coding validation audits measure coder quality and accuracy. And in doing so, they support correct billing and ensure that the right reimbursement is received for each and every patient encounter.
Whether performed internally or by an outside consultant, coding validation audits reap tremendous rewards for the hospitals that conduct them.

However, ensuring effective and informative results from coding audits requires advanced planning and consistent execution by HIM professionals. Targeting efforts, establishing frequency, trending results, and implementing corrective action are all must-do steps for effective coding validation audits.

Fine-Tune Your Efforts
With ICD-10 implementation only 13 months away, new approaches to coding validation audits have emerged. Random coding validation audits have become more focused in order to make the most of HIM’s limited time and audit resources. Revenue integrity still is the primary driver, with a focus on ensuring that all clinical documentation warrants correct code assignment and/or appropriate code omission. The following are three best practice strategies:

• Audit cases without complications/comorbidities (CCs) or major CCs: Prioritize cases by length of stay and review longer admissions without CCs/MCCs first. Search for any diagnosis or procedures documented within the medical record that have not been coded. Some coders will undercode to avoid denials. However, undercoding is just as fraudulent as overcoding. Accuracy and integrity are the overarching goals.

• Audit cases with only one CC or MCC: Review these cases to ensure that documentation supports the one CC or MCC code assigned. Prioritize short lengths of stay and high-weighted diagnosis-related groups (DRGs) (eg, sepsis).

• Audit individual coders: Specialty coding is recommended during the first six months of ICD-10 go-live. Use coding validation audits to identify each coder’s strengths and weaknesses. Align coder assignments in ICD-10 accordingly.

One practice is to conduct individual coder audits concurrently, looking at 100% of each coder’s cases for an entire month. The coding manager or outside auditor reviews all of the coder’s cases at the end of each week, edits them, approves them, and then drops bills for these cases once the review is complete. While this method requires a full-time effort on the last day of each week, it yields valuable information for ongoing education, ICD-10 skill assessment, and specialty code assignment.

Finally, new coders should be audited at 100% until they achieve a 95% accuracy rate. The length of time for this 100% review varies depending on code complexity and case mix. If the coder demonstrates proficiency in a specific type of case, the 100% audit can exclude those cases going forward.

Keep Frequency Consistent
Timing is an important consideration for audits. The decision to conduct audits quarterly, monthly, or at some other frequency should be kept consistent and be based on associated risk. In their 2008 audio seminar on benchmarking coding quality, AHIMA stated that quarterly audits were best practice, with an annual audit by an outside firm. We concur and further specify that each coder should be reviewed at least quarterly.

Trend Results
One of the biggest failures of coding validation audits is the lack of trending. Results of coding audits should be collected and data analyzed to identify trends in incorrect coding. Accurate coding of ventilator hours and sepsis often is identified through audit reporting and trend analysis. Once trends are identified, HIM directors should target educational efforts and implement ongoing monitoring for specific issues.

Any significant changes or drops in case mix index are another trigger for more in-depth coding validation audits. In one case, the case mix index dropped unexpectedly. However, reviews of cases without CCs/MCCs found that coding was performed correctly, and it was believed that the patient acuity had truly dropped as a result of a trauma case being rerouted to a new regional level 1 trauma center.

Information such as this, gleaned from coding validation audits, is valuable as organizations prepare for ICD-10, make strategic service line decisions, and move toward outcomes-based reimbursement.

Turn Insights into Action
Insights lead to action, and coding validation audits deliver tremendous insights to those who use them. While retrospective audits are easier to conduct, insights are delayed and postdischarge changes to the bill are cumbersome. Concurrent audits deliver more timely intelligence for better executive decisions.

Put Technology to Work
Conducted concurrently or retrospectively, audits must be completely documented and communicated to be effective. The use of quality assurance technology tools has become best practice; Excel spreadsheets no longer suffice.

Data entered and insights gleaned through the use of quality assurance tools help organizations recognize a solid return on their audit investment. Systems must now capture, report, and track a growing number of audit elements, such as the following:

• coder and codes assigned;

• reviewer explanations and source documentation;

• DRG changes and reviewer rationale;

• accuracy rate/percentage by coder; and

• trends in missing codes and patterns of overcoding.

Don’t Assume — Inspect
In coding, you don’t get what you assume; you get what you inspect. Audits are a matter of revenue and compliance; risks are a moving target. Therefore, audits must be ongoing and part of a complete coding compliance program. Particularly with ICD-10 on the horizon, coding validation audits provide vision, insights, and knowledge for what lies ahead.

— Kimberly Janet Carr, RHIT, CCS, is clinical documentation manager at HRS.

— Renée Brown, RHIT, CCS, is corporate manager of coding operations at HRS.