December 26, 2007

POA Indicator Creates New Concerns
By Selena Chavis
For The Record
Vol. 19 No. 26 P. 10

The arrival of this piece of legislation—designed to best describe the patients treated within an organization—is likely to have a profound effect on coding and reimbursement.

Industry experts agree that Medicare’s new present on admission (POA) reporting requirement will ultimately deliver improved quality of care for. They also agree that healthcare organizations will need to adequately prepare for new coding and documentation challenges under the system that went into effect October 1.

But no matter what the potential promises of POA reporting are or how well hospitals respond to the challenges, the bottom line rests with this fact: Over time, hospitals can expect revenue losses because Medicare will no longer reimburse for some conditions acquired during hospital stays.

“The biggest unknown is the impact on reimbursement. No matter how right you do it, you’re still going to wind up with less money,” says Rex Stanley, CEO of UnicorMed, an Alabama-based provider of coding books and software. “I think this has been a sleeper item. … This thing is going to snowball.”

Part of the Deficit Reduction Act of 2005, a POA indicator is now required for principal and secondary diagnoses. The Centers for Medicare & Medicaid Services (CMS) was charged with identifying at least two high-cost/high-volume conditions that Medicare would deny payment for if the conditions were acquired during a hospital stay.

Other criteria used by CMS in choosing conditions included whether the condition was assigned to a higher-paying diagnosis-related group (DRG) when presented as a secondary diagnosis and whether the condition was reasonably preventable through application of evidence-based guidelines for Medicare hospital inpatients.

“It will reduce payment to hospitals in some cases when the patient acquires an infection during a hospital stay,” notes Rebecca Gaspard, coding supervisor for Lafayette General Medical Center in Louisiana, adding that the goal is to help distinguish between preexisting conditions and those contracted due to quality-of-care issues.

Beginning October 1, 2008, Medicare will deny reimbursement for the following conditions if not POA: catheter-associated urinary tract infection, vascular catheter-associated infection, pressure ulcers, mediastinitis after coronary artery bypass grafting, and falls. Three conditions noted as serious, preventable events are also covered: object left in during surgery, air embolism, and blood incompatibility.

Medicare will start returning claims that are without POA indicators beginning April 1, 2008. The time frame between October 1, 2007, and December 31, 2007, served as a period of transition as the information was collected on the hospital claim, but Medicare does not intend to provide any remittance to hospitals if the information was not submitted correctly. Hospitals that fail to provide the POA code for discharges on or after January 1, 2008, will receive a remittance informing of the absent or valid POA code.

Challenges and Opportunities
According to Gaspard, the new system offers many opportunities to improve quality of care. For example, it will add precision to ICD-9-CM coding by distinguishing between preexisting conditions and complications, increase the efficiency and effectiveness of hospital quality assurance activities, and improve the accuracy of mortality risk assessment and outcomes research.

The POA initiative comes amid a growing national focus as to how medical errors and other preventable conditions affect hospital stays and patient well-being.

Connie Tohara, national compliance manager for Kforce HealthCare Staffing, suggests that prior to the new rule, there was not a good way to distinguish when a problem occurred in terms of quality of care. “Are there problems that occur after the patient enters the healthcare setting?” she asks. “It makes a significant difference in quality of care when a diagnosis develops after the patient is admitted as opposed to one that he or she comes in with. The new system allows healthcare facilities to identify a condition three ways: present on admission, not present on admission, or undeterminable. It is the key that opens the door to real quality-of-care tracking and trending.”

Pointing to the fact that there are early adopters of the POA requirement, Tohara notes that many states have already enacted this type of system because they realize the benefits to more specific information about patient care. “A number of states have had it in place for a while—New York, California, Florida, Massachusetts, Maryland—separate from the CMS mandate,” she notes. “Primarily, they are states that have strong data committees looking at quality of care … states that are highly populated and have older populations where a lot of senior healthcare is administered.”

Agreeing that the system has the potential to improve quality of care over the long term, Stanley suggests that many challenges exist for HIM departments and healthcare facilities in the short term. “I think it has great potential to improve patient care, but that doesn’t usually take effect until the money piece gets sorted out,” he says, pointing to his belief that it’s going to force medicine to do two things: spot as much up front as possible and implement preventive measures that negate hospital-acquired conditions.

Suggesting that the primary challenges rest with coding reimbursement delays related to decreases in coder productivity and increases in rejected claims, Stanley emphasizes that “your already overworked HIM staff are going to have to have some significant training.”

Tohara agrees, noting that “when you talk to people in states where they have implemented [the POA system], there was a time frame where reimbursement slowed down due to decreased productivity. I haven’t seen a really strong system of POA adoption where productivity wasn’t negatively impacted for a time, if not permanently, at slightly less than before.”

At Lafayette General, Gaspard says the greatest challenge that POA has created for HIM coding staff is the documentation piece. “We need the physician documentation in order to know if a diagnosis is present on admission or not,” she says.

Tohara adds that further complicating the issue is the fact that “physicians have not really understood their role in capturing that information … and when they learn that it is now their responsibility to document POA, they are not very happy about it.”

Although hospitals appear to be focusing their attention on complying with the reporting requirement, Stanley believes they are ignoring the broader financial implications. “I think it’s going to have a profound financial impact,” he says. “People are going to find out that it’s much more important than it’s getting airplay for right now.”

Industry professionals agree that the key to getting an early handle on successfully managing the POA system rests in solid and ongoing training programs for HIM staff and clinicians. Stanley also suggests that facilities take steps to identify prevalent hospital-acquired conditions and implement plans to reduce occurrences, as well as plan for reimbursement reductions over the short and long term.

Forward-thinking Training
While Medicare has provided some breathing room for facilities to gear up and practice using the new system, management at Lafayette General felt that it needed to tackle the issue head-on.

“Once we knew POA was going into effect on October 1, we knew we needed training a couple of months before that,” notes Gaspard, emphasizing the importance of taking a proactive educational stance to the new system. “I met with the coders and went over the guidelines, and they practiced on their charts before the October 1 initiation.”

Gaspard also put together a presentation for the facility’s service line administrators, quality director, utilization management committee, and case management director so they would have ample advance notice that the new system was coming. “Our HIM director has done a presentation to the medical staff on this topic and attended several committee meetings to educate on this topic,” she adds. “So far there has been no resistance from physicians or other staff.”

As part of the training program, Gaspard identifies that the POA guidelines have been published as part of the ICD-9-CM Official Guidelines for Coding and Reporting, but they are “not intended to provide guidance on when a condition should be coded but rather how to apply the POA indicator to the final set of diagnosis codes.”

She says the key to an organization’s successful integration of the new system lies with “consistent and complete” documentation by physicians and clinicians. “Medical record documentation from any provider involved in the care and treatment of the patient may be used to support the documentation of whether a condition was present on admission or not,” she says.

Noting that “getting everyone on the same page” will be the hardest part of a successful rollout, Tohara suggests that the need for adequate and ongoing physician training, as well as strong integration into documentation improvement programs, will likely be the pieces that get overlooked.

“Documentation of POA has to be the physician’s choice and their decision,” she notes. “If a physician is uncertain about the process or why they are doing it, the coder is left to figure it out for themselves. It has the potential to slow down the billing process while coders await physician responses to POA queries.”

While it is not necessary for providers to explicitly document whether a condition is POA to appropriately assign a POA indicator, Stanley believes that issues related to inconsistent, missing, or unclear documentation will create the most challenges.

“It’s one thing to train staff. … when you have to train doctors, you might as well just get out your checkbook,” he laughs, suggesting that it took 10 years to educate physicians about DRGs. “You are going to see medical records running up and down the halls trying to catch up with doctors over this.”

Stanley suggests that healthcare organizations should be forward thinking in the way they go about training staff and physicians on the new system. While Medicare requires a yes or no indicator for whether a condition is POA, three other indicators are also allowable: “U” for unknown, which denotes that documentation is insufficient to make a determination; “W” for clinically undetermined, which indicates that the provider is unable to clinically make a determination; and “E” denoting exemption from POA.

“It’s going to be imperative to get as many of these down to a yes-or-no basis,” Stanley says, adding that one piece that has not been ironed out is how Medicare will respond to W’s and U’s during audits. “[During an audit], that data will decide what they will do with [an organization] next year.”

Gaspard credits Lafayette General’s successful system implementation to its effective and proactive training. “So far, we have had no major problems with POA,” she notes. “Any certain physicians we noticed we needed specific documentation from, then I would get with the case management director so she could educate them one on one. Since doctors have received education on this, we actually see a diagnosis documented then POA next to it.”

Can Technology Help?
With the POA system being so new, industry professionals are uncertain what role technology will play in successful implementations. Because much of the information is subjective and based on physician documentation, many believe it will have a limited role. “We currently have the electronic medical record and if the doctor still does not document correctly, POA cannot be determined,” Gaspard says.

Jan Powell, president of MEGAS, an Alabama-based software developer for coding and compliance, agrees, adding that “it’s hard to provide edits to any clinical component of this other than to identify the necessary code.

“We’ve implemented edits in our claims scrubber software that will at least allow hospitals to identify those codes that require a POA indicator,” she says, noting that “what seemed to be a relatively small request—indicate whether or not the diagnosis was present when the patient was admitted—required at a minimum, considerable software modification for the variety of data entry and claim formats.”

Tohara suggests that a POA field or pop-up reminder could be a beneficial addition to electronic health records, adding that some larger technology vendors are currently providing solutions with POA additions in states that were early adopters of the system. “As they move to more template documentation, that’s the logical place to put it,” she suggests.

Powell believes the technology surrounding these specialty areas of healthcare and coding will continue to evolve. “In the 30 years I’ve been in this industry, it just gets more and more complex. Now you have software developers that focus on specific niches,” she says. “It’s just one additional change the HIM professional has to get their arms around.”

— Selena Chavis is a Florida-based freelance journalist whose writing appears regularly in various trade and consumer publications covering everything from corporate and managerial topics to healthcare and travel.