Written Policies and Procedures II

The following is an excerpt from the Human & Health Services – Guidelines for 3rd Part Medical Billing Companies

Program Guidance for Third Party Medical Billing Companies
1. Introduction
A. Benefits of a Compliance Program
B. Application of Compliance Program Guidance
II. Compliance Program Elements
A. Written Policies and Procedures – Part I | Part II
B. Designation of a Compliance Officer and a Compliance Committee
C. Conducting Effective Training and Education
D. Developing Effective Lines of Communication
E. Enforcing Standards Through Well-Publicized Disciplinary Guidelines
F. Auditing and Monitoring
G. Responding to Detected Offenses and Developing Corrective Action Initiatives
III. Conclusion

A. Written Policies and Procedures – Part II

3. Claim Submission Process
A number of the risk areas identified above, pertaining to the claim development and submission process, have been the subject of administrative proceedings, as well as investigations and prosecutions under the civil False Claims Act and criminal statutes. Settlement of these cases often has required the defendants to execute corporate integrity agreements, in addition to paying significant civil damages and/or criminal fines and penalties. These corporate integrity agreements have provided the OIG with a mechanism to advise billing companies concerning acceptable practices to ensure compliance with applicable Federal and State statutes, regulations and program requirements. The following recommendations include a number of provisions from various corporate integrity agreements. Although these recommendations include examples of effective policies, each billing company should develop its own specific policies tailored to fit its individual needs. With respect to claims, a billing company’s written policies and procedures should reflect and reinforce current Federal and State statutes. The policies must create a mechanism for the billing or reimbursement staff to communicate effectively and accurately with the health care provider. Policies and procedures should:

• Ensure that proper and timely documentation of all physician and other professional services is obtained prior to billing to ensure that only accurate and properly documented services are billed;
• Emphasize that claims should be submitted only when appropriate documentation supports the claims and only when such documentation is maintained, appropriately organized in legible form and available for audit and review. The documentation, which may include patient records, should record the time spent in conducting the activity leading to the record entry and the identity of the individual providing the service;
• Indicate that the diagnosis and procedures reported on the reimbursement claim should be based on the medical record and other documentation, and that the documentation necessary for accurate code assignment should be available to coding staff at the time of coding. The HCFA Common Procedure Coding System (HCPCS), International Classification of Disease (ICD), Current Procedural Terminology (CPTTM), any other applicable code or revenue code (or successor code(s) ) used by the coding staff should accurately describe the service that was ordered by the physician;
• Provide that the compensation for billing department coders and billing consultants should not provide any financial incentive to improperly upcode claims; 53
• Establish and maintain a process for pre- and post-submission review of claims54 to ensure claims submitted for reimbursement accurately represent services provided, are supported by sufficient documentation and are in conformity with any applicable coverage criteria for reimbursement; and
• Obtain clarification from the provider when documentation is confusing or lacking adequate justification.
Because coding for providers often involves the interpretation of medical diagnosis and other clinical data and documentation, a billing company may wish to contract with/assign a qualified physician to provide guidance to the coding staff regarding clinical issues. Procedures should be in place to access medical experts when necessary. Such procedures should allow for medical personnel to be available for guidance without interrupting or interfering with the quality of patient care.

4. Credit Balances
Credit balances occur when payments, allowances or charge reversals posted to an account exceed the charges to the account. Providers and their billers should establish policies and procedures, as well as responsibility, for timely and appropriate identification and resolution of these overpayments.55 For example, a billing company may redesignate segments of its information system to allow for the segregation of patient accounts reflecting credit balances. The billing company could remove these accounts from the active accounts and place them in a holding account pending the processing of a reimbursement claim to the appropriate payer. A billing company’s information system should have the ability to print out the individual patient accounts that reflect a credit balance in order to permit simplified tracking of credit balances. The billing company should maintain a complete audit trail of all credit balances.

In addition, a billing company should designate at least one person (e.g., in the patient accounts department or reasonable equivalent thereof) as having the responsibility for the tracking, recording and reporting of credit balances. Further, a comptroller or an accountant in the billing company’s accounting department (or reasonable equivalent thereof) may review reports of credit balances and adjustments on a monthly basis as an additional safeguard.

5. Integrity of Data Systems
Increasingly, the health care industry is using electronic data interchange (EDI) to conduct business more quickly and efficiently. As a result, the industry is relying on the capabilities of computers. Billing companies should establish procedures for maintaining the integrity of its data collection systems. This should include procedures for regularly backing-up data (either by diskette, restricted system or tape) to ensure the accuracy of all data collected in connection with submission of claims and reporting of credit balances. At all times, the billing company should have a complete and accurate audit trail. Additionally, billing companies should develop a system to prevent the contamination of data by outside parties. This system should include regularly scheduled virus checks. Finally, billing companies should ensure that electronic data are protected against unauthorized access or disclosure.

6. Retention of Records
Billing company compliance programs should provide for the implementation of a records system. This system should establish policies and procedures regarding the creation, distribution, retention, storage, retrieval and destruction of documents. The three types of documents developed under this system should include: (1) All records and documentation required by either Federal or State law and the program requirements of Federal, State and private health plans (for billing companies, this should include all documents related to the billing and coding process); (2) records listing the persons responsible for implementing each part of the compliance plan; and (3) all records necessary to protect the integrity of the billing company’s compliance process and confirm the effectiveness of the program. The documentation necessary to satisfy the third requirement includes: evidence of adequate employee training; reports from the billing company’s hotline; results of any investigation conducted as a consequence of a hotline call; modifications to the compliance program; self-disclosure; all written notifications to providers; 56 and the results of the billing company’s auditing and monitoring efforts.

7. Compliance as an Element of a Performance Plan
Compliance programs should require that the promotion of, and adherence to, the elements of the compliance program be a factor in evaluating the performance of all employees. Employees should be periodically trained in new compliance policies and procedures. In addition, all managers and supervisors involved in the coding and claims submission processes should:

• Discuss with all supervised employees and relevant contractors the compliance policies and legal requirements applicable to their function;
• Inform all supervised personnel that strict compliance with these policies and requirements is a condition of employment; and
• Disclose to all supervised personnel that the billing company will take disciplinary action up to and including termination for violation of these policies or requirements.
In addition to making performance of these duties an element in evaluations, the compliance officer or company management should include a policy that managers and supervisors will be sanctioned for failure to instruct adequately their subordinates or for failure to detect noncompliance with applicable policies and legal requirements, where reasonable diligence on the part of the manager or supervisor should have led to the discovery of any problems or violations.