1. Hess, Cathy Thomas BSN, RN, CWOCN

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The tide is turning for healthcare as we are moving from fee-for-service to a pay-for-performance-based healthcare system. This was evidenced by the recent release of the Centers for Medicare & Medicaid Services (CMS) 2014 Hospital Outpatient Prospective Payment System and Ambulatory Surgical Center Payment System Policy Changes and Payment Rates final rule with comment period.1


The final rule streamlines the current 5 levels of outpatient clinic visit codes, replacing them with a single Healthcare Common Procedure Coding System (HCPCS) code describing all clinic visits. The CMS states: "A single code and payment for clinic visits is more administratively simple for hospitals and better reflects hospital resources involved in supporting an outpatient visit. The current 5 levels of outpatient visit codes are designed to distinguish differences in physician work."2


Per the CMS: "Under this proposal, all clinic visits would be reported using the new HCPCS G code, regardless of whether the patient has been registered as an inpatient or outpatient of the hospital within the 3 years prior to a visit" (see page 670 of Final Rule). Regarding non-Medicare payors, it will be the facility's responsibility to maintain the current billing structure for non-Medicare payors until further notified by the payor. In addition, the CMS also announced it will create 2 payment bundles-"high price" and "low price"-to reflect the various skin substitute products on the market (see pages 332-342).1


Lastly, CMS clearly states that it is important to continue to document and report Current Procedural Terminology/HCPCS codes and charges supporting the work performed for the visit. The outpatient documentation will be reviewed for rate setting in the future (see page 671 of Final Rule).1


Your documentation continues to be the essential "common thread" to justify payment, manage patient care, and monitor outcomes. In this column, we will begin to review the essential documentation elements necessary to support the work performed in the wound care department. In subsequent columns, we will map additional documentation elements and the use of integrating advanced adjunctive therapies sooner into the patient's plan of care to drive cost-efficient and effective outcomes sooner.


As healthcare providers, we believe the most critical function of the medical record is to plan and provide continuity of care for a patient's medical treatment. The documentation in the medical record does provide for this function, but in many instances, we, as healthcare providers, forget that the additional function of the medical record includes the following:


* supporting information for the financial reimbursement to hospitals, healthcare providers, skilled nursing facilities, and patients;


* supporting legal documentation in cases of injury or other legal proceedings;


* supporting information for quality-assurance and peer-review committees, state licensing agencies, and state regulatory agencies when assessing the quality of care provided; and


* supporting the critical information in an accreditation process, such as The Joint Commission, CMS, or the Undersea & Hyperbaric Medical Society.



Wound care documentation must support compliance, reimbursement, guidelines, and regulations. These elements can be met only through the appropriate documentation in the medical record. No matter the healthcare setting in which one provides care for wound and skin issues, the critical element becomes the documentation in the medical record.


The CMS has defined medical necessity as "No Medicare payment shall be made for items or services that are not reasonable and/or necessary for the diagnosis or treatment of illness or injury to improve the function of the malformed body member." In short, the clinical documentation, diagnosis, and Current Procedural Terminology (CPT-4(R))3 codes reported must meet medical necessity, or the claim will not be paid.


Medical necessity guidelines can be payer specific, but most often payers follow those guidelines published by CMS: National Coverage Determinations or Local Coverage Determinations. It is also prudent to be familiar with the private and managed care payer agreements and limitations. From the time the patient is called to schedule his/her services, the documentation process begins. Patient demographic and payer information is gathered; medical necessity and coverage are confirmed and entered into the documentation system. It is very important to diligently document the work performed for each encounter, supporting medical necessity for the visit.


With the change in payment for outpatient departments (as of January 1, 2014), it is essential to pay particular attention to the documentation requirements for procedures and documentation to support "new" and "established" patients. These aspects of documentation will be covered in subsequent columns.


Editor's note: For more information on procedure code changes, see Payment Strategies on page 58.




1. Federal Register. Medicare and Medicaid Programs: Hospital Outpatient Prospective Payment and Ambulatory Surgical Center Payment Systems and Quality Reporting Programs; Hospital Value-Based Purchasing Program; Organ Procurement Organizations; Quality Improvement Organizations; Electronic Health Records (EHR) Incentive Program; Provider Reimbursement Determinations and Appeals. Last accessed December 17, 2013. [Context Link]


2. Centers for Medicare & Medicaid Services. CMS makes outpatient facility policy and payment changes. [Context Link]


3. Current Procedural Terminology CPT 2013. Chicago, IL: American Medical Association; 2013. [Context Link]