Payers turning to clinical validation to ignore coding guidelines, deny claims

By Brian Murphy

 

Clinical validation audits are on the rise and among the chief causes of claims denials, per my current Off the Record podcast guest Richelle Marting, JD, MHSA, RHIA, CPC, CEMC, CPMA, CPC-I.

 

While denials are payer-agnostic, Marting says that Medicare Advantage Organizations have risen to the top of worst offenders. Medicare Advantage plans can set their own individual coverage and payment policies that don’t match traditional Medicare—and their policies are often opaque and more restrictive.

 

Two recent clinical validation tactics being employed with greater frequency include the following:

 

Payers ignoring the guidelines for reporting additional diagnoses as detailed in Section III of the Official Guidelines for Coding and Reporting, instead focusing only on diagnostic criteria of a given condition for coverage. Per the guidelines, the definition of “other diagnoses” is interpreted as additional *clinically significant* conditions that affect patient care in terms of requiring:

 

• clinical evaluation; or
• therapeutic treatment; or
• diagnostic procedures; or
• extended length of hospital stay; or
• increased nursing care and/or monitoring

 

Payers for example will argue that the patient’s sodium wasn’t low enough to quality as hyponatremia, or the patient’s oxygen saturation wasn’t low enough for acute respiratory failure, i.e., not clinically significant—and therefore can’t be reported as an additional diagnosis. And issue a denial. Even though a physician evaluated the patient, made the diagnosis, and additional nursing time and care was expended in his/her care.

 

Payers creating their own diagnostic criteria based on outdated definitions, or in some cases, self-created definitions inaccessible in the clinical literature. Sepsis is a problem but acute respiratory failure even more so coming out of the COVID-19 pandemic, per Marting.

 

Other diagnoses for which payers create their own (restrictive or subjective) definitions include:

• Hyponatremia
• Severe protein calorie malnutrition
• Acute blood loss anemia
• Metabolic encephalopathy
• Acute kidney injury

 

*Note: The phrase “clinically significant” was added to the Official Guidelines effective Oct. 1, 2023 (see link below). This small change undoubtedly gave payers additional ammunition, as they can now argue any diagnosis lacks sufficient clinical significance.

 

What are you seeing for denials in your organization these days? Leave me a comment at brian.murphy@norwood.com.

 

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References

 

Listen to the full episode with Richelle (Spotify): https://open.spotify.com/episode/5p6sB0Zn8a8QvXw6QwZWEo

 

FY 2024 ICD-10-CM Official Guidelines for Coding and Reporting: https://stacks.cdc.gov/view/cdc/133289

 

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