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HCA Coding Methods Invigorate Profits. This is Bad?

Philip Betbeze, for HealthLeaders Media, August 31, 2012

Let's be frank. Some of these changes, which have resulted in increased profitability, have been forced on hospitals and health systems through the threat of audit from both commercial payers and the dreaded recovery audit contractors authorized by CMS to review past cases. These RACs, as they are known, attempt to retroactively deny payment for poorly documented patient care. The reasoning is that such careful supervision, even retroactively, would cut down on Medicare fraud.

Perhaps the RACs have worked too well. In reality, many hospitals have done exactly the same thing HCA has—at least if they're paying close attention to the type of clinical documentation they need to be doing to avoid costly and potentially penalty-riddled audits later.

I talked recently with Gerri Birg, a managing director at healthcare consultancy Huron Healthcare, about changes in documentation strategies that hospitals have adopted in recent years in response to threats of audit. These are serious threats. In essence, improper and incomplete coding can result in the loss of payments already on the hospital's books—a huge threat to whether they will be able to carry on their missions going forward.

Over the past 12 years, Birg, a registered nurse and former administrative nursing manager at Henry Ford Health System in Detroit, has become an expert on clinical documentation strategies and consults with major health systems on how to do it better.

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