National Correct Coding Initiative NCCI and Mutually Exclusive

National Correct Coding Initiative (NCCI) and Mutually Exclusive Edits (MUE) Deciphering the NCCI and MUE tables, how appropriate interpretation impacts reimbursement May 20, 2016

Today’s Agenda Welcome and opening comments 2 NCCI edits promote correct coding and avoid inappropriate reimbursement 3 General correct coding guidelines 8 NCCI general principles for medical/surgical procedures 11 How to interpret NCCI edits 15 What are Medically Unlikely Edits (MUE)? 21 Question & answer 30 Copyright © 2016 Deloitte Development LLC. All rights reserved.

NCCI edits promote correct coding and avoid inappropriate reimbursement

NCCI edits promote correct coding and avoid inappropriate reimbursement • The National Correct Coding Initiative (NCCI or CCI edits) was implemented to promote national correct coding methodologies and control improper coding which leads to inappropriate reimbursement. • When two or more procedures are billed together, the claim is sent through a scrubber. The scrubber has automated prepayment edits which prevent improper coding and billing for covered Part B services. • 4 - One table for physicians/practitioners - One table for outpatient hospital services The National Correct Coding Initiative was implemented in 1996 and is updated quarterly. Copyright © 2016 Deloitte Development LLC. All rights reserved.

Medically Unlikely Edit (MUE) flag for maximum number of units allowed • A Medically Unlikely Edit (MUE) is a maximum number of units allowed under ordinary conditions for a single Current Procedural Terminology/Healthcare Common Procedure Coding System (CPT/HCPCS) code billed by a provider on a date of service for a single beneficiary. • Center for Medicare and Medicaid Services (CMS) implemented the MUEs in 1997. 5 Copyright © 2016 Deloitte Development LLC. All rights reserved.

NCCI policy manual for Medicare services breakdown Introduction Purpose The Omnibus Budget Reconciliation Act of 1989 amended the Social Security Act to assure uniform payment policies and procedures were followed by all carriers (A/B MACs) so the same service would be reimbursed similarly in all carrier (A/B MACs) jurisdictions for Physician Services. This was the implementation of the Medicare Physician Fee Schedule. Coding policies are based on coding conventions based on the American Medical Association (AMA) CPT manual, National Coverage (NCD) and Local Coverage Determinations (LCD), coding guidelines developed by national societies, standard medical and surgical practice and/or current coding practice. Background To encourage consistent, correct coding to reduce inappropriate reimbursement. 6 Copyright © 2016 Deloitte Development LLC. All rights reserved.

NCCI policy manual for Medicare services breakdown (cont’d) Additions, deletions or modifications to CPT/HCPS codes CMS Policy Initiatives Comments from AMA, national or local organizations, medical/surgical societies and others *Note: Correspondence – NCCI is maintained by Correct Coding Solutions, LLC for CMS 1) 2) 3) 7 National Correct Coding Initiative Policy Manual for Medicare Services ( http: //www. cms. gov/Medicare/Coding/National. Correct. Cod. Init. ED. index. html ) MUE Overview (http: //www. cms. gov/Medicare/Coding/National. Correct. Cod. Init. Ed/MUE. html ) Current quarterly version update changes for NCCI PTP edits and published MUEs ( http: //www. cms. gov/Medicare/Coding/National. Correct. Cod. Init. Ed/Version_Update_Changes. html ) Copyright © 2016 Deloitte Development LLC. All rights reserved.

General correct coding guidelines

General correct coding guidelines • Coding based on standards of medical and surgical practice • Medical and surgical package (pre, intra, post-operative included) • Evaluation and Management Services (E&M) • Modifiers and modifier indicators • Monitoring services and standard preparation for anesthesia services • Anesthesia service Included in the surgical procedure • CPT/HCPCS Procedure Code definition • CPT Manual and CMS Coding Manual instructions • CPT “Separate Procedure” definition 9 Copyright © 2016 Deloitte Development LLC. All rights reserved.

General correct coding guidelines (cont’d) • Sequential procedure • Laboratory panels • Misuse of column 2 code with column 1 code • Mutually exclusive procedures • Gender specific procedures • Add-on codes • Excluded service • Unlisted procedure codes • Modified, deleted and added code pairs/edits • Medically unlikely edits (MUEs) 10 Copyright © 2016 Deloitte Development LLC. All rights reserved.

NCCI general principles for medical/surgical procedures

NCCI general principles for medical/surgical procedures XXX: Does not apply to the global surgical package YYY: Defined by the carrier ( A/B MAC processing claims for practitioners) Medicare Physician Fee Schedule ZZZ: Procedure is related to another procedure and the applicable global period for ZZZ code is determined by the related procedure MMM: For maternity procedures 000, 010, 090*: E/M procedures are separately reportable on the same date of service with the aforementioned global periods under limited circumstances *For 090 global period, the E/M service separately reportable if the decision for surgery is on the same date of service as the major surgical procedure with modifier 57 12 Copyright © 2016 Deloitte Development LLC. All rights reserved.

Why is it important to understand Medicare surgical global packages • Procedures with 000 or 010 global days are considered minor surgical procedures. The decision to perform the minor surgical procedure is included in the payment for the procedure. There are no global days associated with a procedure assigned with 000 and ten days for a procedure assigned with 010. • If the E/M service is separate and identifiable from the minor surgical procedure the E/M service is reportable. The E/M service and the minor surgical procedure do not require different diagnosis code(s). Applying modifier 25 on the E/M service is appropriate. For example: patient presents to office for cough and sore throat. Walking to exam room, the patient trips and falls requiring a suturing of a deep wound of the forearm. • For both minor and major surgical procedures, the post-operative E/M services are included in the payment for the procedure. • During the post-operative service, an E/M service may be separately reportable if the service is unrelated to the minor/major procedure. Modifier 24 is appropriate. • Global Package XXX, are never reported with an E/M service. These procedures include the pre-operative, intra-operative and post-operative procedures. 13 Copyright © 2016 Deloitte Development LLC. All rights reserved.

How to appropriately use modifier(s) • May be applied only if the medical record documentation and clinical circumstances justify the use of an alphanumeric modifier. • Modifiers are generally used for encounters related to separate patient encounters, separate anatomic sites or separate specimens, not solely to bypass a NCCI procedure to procedure (PTP) edit. • Modifiers include anatomic, global surgery and other. • Examples include: 14 • Anatomic: E 1 -E 4, FA, F 1 -F 9, TA, T 1 -T 9, LT, RT, LC, LD, RC, LM, RI • Global: 24, 25, 57, 58, 79 • Other: 22, 27, 59, 76, 91, XE, XS, XP, XU Copyright © 2016 Deloitte Development LLC. All rights reserved.

How to interpret NCCI edits

NCCI general principles for medical/surgical procedures 16 Component (column 2) service is an accepted standard of care when performing the comprehensive (column 1) service. 1 Component service is usually necessary to complete the comprehensive service. 2 Component service is not separately distinguishable procedure when performed with the comprehensive service. 3 Services which are integral to the procedures are not separately reportable. Some examples are cleansing, shaving and prepping of skin, insertion of Intravenous (IV) medications, insertion of urinary catheter, etc. 4 NCCI edits are classified as procedure to procedure edits (PTP) or other. 5 Copyright © 2016 Deloitte Development LLC. All rights reserved.

Example of NCCI table 17 Copyright © 2016 Deloitte Development LLC. All rights reserved.

How to interpret NCCI edits Each code pair is assigned a modifier indicator. Indicator Description Indicator “ 0” Determines a modifier cannot be used to bypass an edit. The two codes cannot be billed together for the same patient on the same date of service during the same episode. The component code will be denied and the comprehensive code is eligible for payment. Indicator “ 1” Determines a modifier may be used to bypass an edit if the appropriate circumstances are met. For instance, when a procedure is performed on contralateral organs or structures and the documentation in the medical record supports the use of the modifier. Indicator “ 9” determines the edit has been deleted and a modifier is not appropriate. 18 Copyright © 2016 Deloitte Development LLC. All rights reserved.

CMS adds further explanation for modifier 59 distinct procedural service • The modifier is used inappropriately most often. • Used to indicate that two or more procedures are performed at different anatomic sites or different patient encounters. • To be used only if another modifier cannot further explain the relationship of the two procedures being billed. • Modifier 59 is not appropriate for evaluation and management (E/M) services. Modifier 25 is appropriate for separate and distinct services. • XE, XS, XP, XU became effective January 1, 2015 to increase the specificity on the usage of modifier 59. These are to be used in lieu of modifier 59. • For Medicare claims, the “X” modifiers are to be used prior to modifier 59 as “X” further defines the relationship of the procedures performed. Some third-party payers have not adopted the usage of the “X” modifiers, please review their individual guidance. 19 Copyright © 2016 Deloitte Development LLC. All rights reserved.

CMS adds further explanation for modifier 59 distinct procedural service (cont’d) Definitions XE: Separate Encounter A service that is distinct because it occurred during a separate encounter. ”. Only to be used to describe separate encounters on the same date of service. XS: Separate Structure A service that is distinct because it was performed on a separate organ/structure. XP: Separate Practitioner A service that is distinct because it was performed by a different practitioner. XU: Unusual Non. Overlapping Service 20 The use of a service that is distinct because it does not overlap usual components of the main service. Copyright © 2016 Deloitte Development LLC. All rights reserved.

What are Medically Unlikely Edits (MUE)?

What are Medically Unlikely Edits (MUE)? • An MUE for a HCPCS/CPT code is the maximum number of Units of Service (UOS) under most circumstances allowable by the same provider for the same beneficiary on the same date of service. • As of April 1, 2013, CMS introduced date of service MUEs. • MUEs are adjudicated as either claim line edits or Date of Service (DOS) MUEs. • MUEs adjudicated as a claim line edit, UOS on each claim line are compared to MUE value for the HCPCS/CPT code on the claim line. • If the units of service on that claim line exceeded the MUE value, the entire claim line is denied. • DOS MUEs are adjudicated as all the UOS on each claim line for the same date of service for the same HCPCS/CPT code are summed and the sum is compared to the MUE value. • If the sum exceeds the MUE value, all claim lines are denied. Source: Note: Chapter I General Correct Coding Policies for National Correct Coding Initiative Policy Manual for Medicare Services Revison Date 1/1/2016 Section V 22 Copyright © 2016 Deloitte Development LLC. All rights reserved.

What type of edit is an MUE? • An MUE is a coding edit which needs to follow the guidance discussed during this presentation. • MUEs are NOT: Medical necessity edits The claims processing contractor may have more restrictive guidance or number of units for a HCPCS/CPT code. The more restrictive MUE needs to be followed for correct billing for the number of units. 23 Utilization edits Many HCPCS/CPT codes are billed with less than the MUE value, however some codes are billed with the commonly units reported. These claims may be subject to review by the claims processing contractor, and other government agencies. Copyright © 2016 Deloitte Development LLC. All rights reserved.

MUE adjudication considerations • The MUE files on the CMS NCCI website display an “MUE Adjudication Indicator” (MAI) for each HCPCS/CPT code. An MAI of “ 1” indicates that the edit is a claim line MUE. An MAI of “ 2” or “ 3” indicates that the edit is a DOS MUE. • Appropriate use of modifiers may be reported with CPT/HCPCS codes for the claim line adjudication of MUEs. For example the use of anatomic modifiers for the same CPT code for the same DOS. • MUEs for HCPCS codes with an MAI of “ 2” are absolute date of service edits. These are “per day edits based on policy. ”. HCPCS codes with an MAI of “ 2” have been rigorously reviewed and vetted within CMS and obtain this MAI designation because UOS on the same date of service in excess of the MUE value would be considered impossible because it was contrary to statute, regulation or sub regulatory guidance. • MUEs for HCPCS codes with an MAI of “ 3” are “per day edits based on clinical benchmarks. ”. MUEs assigned with an MAI of “ 3” are based on criteria (e. g. , nature of service, prescribing information) combined with data such that it would be possible, but medically unlikely, that higher values would represent correctly reported medically necessary services. Note: Chapter I General Correct Coding Policies for National Correct Coding Initiative Policy Manual for Medicare Services Revision Date 1/1/2016 Section V 24 Copyright © 2016 Deloitte Development LLC. All rights reserved.

MUE adjudication considerations Both MAI and MUE values for each HCPCS/CPT code are based on one or more of the following criteria: 1) Anatomic considerations may limit units of service based on anatomic structures. 2) CPT code descriptors/CPT coding instructions in the CPT manual may limit units of service. 3) Edits based on established CMS policies may limit units of service. 4) The nature of an analyte may limit units of service and is in general determined by one of three considerations. 5) The nature of a procedure/service may limit units of service and is in general determined by the amount of time required to perform a procedure/service. 6) The nature of equipment may limit units of service and is in general determined by the number of items of equipment that would be utilized. 7) Clinical judgement considerations and determinations are based on input from numerous physicians and certified coders. 8) Prescribing information is based on FDA labeling as well as off-label information published in CMS-approved drug compendia. 9) Submitted claims data (100%) from a six month period is utilized to ascertain the distribution pattern of UOS typically billed for a given HCPCS/CPT code. 25 Copyright © 2016 Deloitte Development LLC. All rights reserved.

MUE drug adjudication considerations • HCPCS J code and drug related C and Q code MUEs are based on prescribing information and 100% claims data for a six month period. • Guiding principles utilized in developing these edits: Guiding Principle Description 1 If the prescribing information defined a maximum daily dose, this value was used to determine the MUE value. 2 If the maximum daily dose calculation is based on actual body weight, a dose based on a weight range of 110 -150 kg was evaluated against claim data. 3 For “as needed” (PRN) drugs and drugs where maximum daily dose is based on patient response, prescribing information and claims data were utilized to establish MUE values. 4 Published off-label usage of a drug was considered for the maximum daily dose calculation. 5 The MUE values for some drug codes are set to 0. Note: Chapter I General Correct Coding Policies for National Correct Coding Initiative Policy Manual for Medicare Services Revison Date 1/1/2016 Section V 26 Copyright © 2016 Deloitte Development LLC. All rights reserved.

Example of outpatient hospital MUE table Current Procedural Terminology (CPT) codes, descriptions and other data only are copyright 2015 American Medical Association. All rights reserved. CPT® is a registered trademark of the American Medical Association. Applicable FARSDFARS Restrictions Apply to Government Use. Outpatient HCPCS/CPT Hospital Services Code MUE Values G 0452 1 G 0453 10 G 0454 1 G 0455 1 G 0458 1 G 0459 0 G 0460 1 G 0463 6 G 0464 1 G 0472 1 G 3001 1 G 6001 1 27 MUE Adjudication Indicator 3 Date of Service Edit: Clinical 2 Date of Service Edit: Policy 1 Line Edit 3 Date of Service Edit: Clinical 2 Date of Service Edit: Policy MUE Rationale Nature of Service/Procedure Clinical: CMS Workgroup Nature of Service/Procedure CMS Policy Nature of Service/Procedure Nature of Analyte Prescribing Information Clinical: Data Copyright © 2016 Deloitte Development LLC. All rights reserved.

Example of practitioner services MUE table Current Procedural Terminology (CPT) codes, descriptions and other data only are copyright 2015 American Medical Association. All rights reserved. CPT® is a registered trademark of the American Medical Association. Applicable FARSDFARS Restrictions Apply to Government Use. HCPCS/CPT Code G 0452 G 0453 G 0454 G 0455 G 0458 G 0459 G 0460 G 0463 G 0464 G 0472 G 3001 G 6001 28 Practitioner Services MUE Values 6 40 1 1 1 0 1 1 MUE Adjudication Indicator 3 Date of Service Edit: Clinical 2 Date of Service Edit: Policy 1 Line Edit 2 Date of Service Edit: Policy 3 Date of Service Edit: Clinical 2 Date of Service Edit: Policy MUE Rationale Clinical: Data Clinical: CMS Workgroup Nature of Service/Procedure Nature of Service/Procedure CMS Policy Nature of Analyte Prescribing Information Clinical: Data Copyright © 2016 Deloitte Development LLC. All rights reserved.

Today’s speaker Denise “Dee” Di. Mauro Advisory Specialist Senior – Deloitte Advisory Deloitte & Touche LLP Tel: (860) 725 -3503 Email: dedimauro@deloitte. com Experience Denise is a Specialist Senior with Deloitte Advisory, and focuses on the Healthcare Provider sector. With over 15 years of supervisory and management experience, she has conducted training and presented lectures on ICD-9, ICD-10, Coding Compliance, and Billing Related Issues as AHIMA-approved ICD-10 -CM/PCS trainer. Denise’s experience in electronic health records and billing includes systems such as Epic, Meditech, Cerner (with Powerchart), HPF, and SDK. Denise has been an active participant on the OIG compliance review team and her specialty areas also include cardiac catheterization and cardiovascular services, professional fee coding, charge description master (CDM), general hospital outpatient coding/billing, billing/reporting of chemotherapy drug units, mergers and acquisitions and inpatient/outpatient rehabilitative therapy. Prior to joining Deloitte, Denise served as Client Manager for Facility and Professional Outpatient Services with a consulting firm and Revenue Compliance Auditor/Educator with a large academic healthcare system where she assisted with annual audit plan and design, reviewed physician documentation for E/M coding, performed education to the physician(s) and conducted follow-up monitoring of management action plans. Denise performs record selection using RATstats and audit criteria and conducts audits of clinical records, report writing, and educational session presentations. She regularly collaborates closely with internal audit teams and teaches advanced training in healthcare compliance (e. g. , HIPAA, Compliance Hotline, Privacy, Nondisclosure, and Security). Denise has attained the following credentials CPMA, CPC-H. 29 Copyright © 2016 Deloitte Development LLC. All rights reserved.

Today’s speaker Elizabeth “Liz” Cook Advisory Specialist Senior – Deloitte Advisory Deloitte & Touche LLP Tel: (616) 826 -5679 Email: elcook@deloitte. com Experience Liz is a Specialist Senior with Deloitte Advisory, and focuses on the Healthcare Provider sector. With over 25 years of professional experience in healthcare, she specializes in outpatient and inpatient coding and billing, clinical documentation, revenue cycle, medical coding educator and ICD 10 trainer. As a Certified Electronic Health Records Specialist, she is experienced with Epic, Cerner, Meditech and Records. One systems. Since joining Deloitte, Liz Cook has participated in compliance, revenue cycle, and internal audit assessments for a wide variety of health care organizations. She is a specialist used by the firm involving the main focus areas of inpatient, SNF, hospital outpatient and professional chart auditing, E/M, ICD-9 and ICD-10 coding gap analysis, clinical documentation excellence and multiple facets of the revenue cycle. Her experience includes auditing of records through the application of specialist compliance related knowledge and expertise, while further consulting with internal and external parties to contribute to the ongoing development and improvement of compliance and risk management, while contributing to the delivery of efficient and effective policies to support a range of compliance, audit and risk management matters in accordance with government policies and procedures, legislative requirement and professional standards. Liz has attained the following credentials: CCS, CPC, CASCC, CHA, CHI, CPh. T, CEHRS, and AHIMA ICD 10 Trainer. Currently she serves as President for her local AAPC chapter and is a member of both AAPC and AHIMA. 30 Copyright © 2016 Deloitte Development LLC. All rights reserved.

Question & answer?

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