Proving Medical Necessity (Part 1)

Have you ever received a letter from Medicare or another managed care provider stating that the treatment you provided for your patient was not medically necessary? After receiving the notice, you or your staff member call or write the insurance company to appeal the decision. Then the insurance company instructs you to forward the patient’s medical records for review. After sending in the information requested and waiting for what seems like an eternity, you get another letter saying that your claim is still being denied because the treatment provided was not medically necessary.

Or, have you ever has records requested by an insurance company after they paid for the treatment provided (a post-payment audit)? After reviewing the requested records, the managed care company asked your office to refund the benefits that they previously paid. I believe almost all of us can say that one of these two scenarios has happened to us at least once. As a physician, I think “how dare they. What does someone sitting behind a desk know about treating my patient?”

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In this two-part series, I am going to demonstrate how to prove medical necessity in order to improve reimbursement and decrease the likelihood of being audited.

In short, the best way to prove medical necessity is through detailed documentation. Unfortunately, as a profession, we still have poor documentation practices, and in fact, the Office of Inspector General’s (OIG) report released on May 6, 2009, states that in 2006 Medicare inappropriately paid $178 million (out of $466 million) for chiropractic claims. $157 million was for maintenance care, $11 million was due to miscoding and $46 million was due to undocumented claims. This represents 47% of all allowed claims meeting the study criteria. The report further states that 83% of chiropractic claims failed to meet one or more of the documentation requirements required by Medicare. As a chiropractic profession, we must improve our documentation.

In this article, I am going to discuss the importance of using outcome management tools to prove the need for care and medical necessity. For care to be considered medically necessary a doctor must objectively document a patient’s functional improvement, not just a decrease in pain. Outcome management tools are:

• objective and functionally based,
• establish the patient’s ability to carry out their activities of daily living (ADL’s),
• a valid, cost-effective and quantifiable measurement of a patient’s symptoms and functional limitations in carrying out their ADL’s and
• assist the doctor to establish short term and long term treatment goals. For example, a functional goal for a patient who reported being unable to stand for more than 10 minutes without pain would be to increase the patient’s ability to stand for a longer period of time without pain. It is also important to document in the patient’s file how you will accomplish these goals, the number of treatments to achieve these goals and the date of the patient is to repeat the outcome questionnaire to establish the patient’s progress or lack thereof.

The three most common outcome management tools used by chiropractors are the Neck Pain Disability Questionnaire, the Triple Visual Analog Scale and the Revised Oswestry Questionnaire. The Triple Visual Analog Scale is an excellent way to track a patient’s perception of pain. This outcome measure should be repeated every 3 to 4 visits. The Revised Oswestry Questionnaire evaluates chronic low back problems. Another popular outcome management tool is the Roland-Morris Questionnaire which evaluates acute and subacute low back pain. There are also outcome management tools that evaluate headaches, extremities, and psychosocial issues.

It is important to establish a protocol for administering outcome management tools. The outcome tools should be used by every chiropractic physician and be completed by every patient regardless of how they are paying for their care. I know some doctors who only use these assessments on PI or workman comp cases. However, a doctor needs to remember that a cash patient can file a malpractice case, and the doctor would need to show that there was a medical necessity for this person’s care as well.

A patient should complete an outcome management questionnaire on the first day of care to establish a baseline. The same outcome tool should be repeated at all re-exams, whenever a patient has an exacerbation, and upon release of care. It is also important to score any measurement tools used and document this in the patient’s file. In order to be clinically significant, there should be a 30% change in score from the original outcome score to the score at re-exam.

The use of outcome management tools is so important that under the Physician Quality Reporting Initiative (PQRI) doctors who report the use of functional outcome assessments to Medicare will receive an incentive payment. Not only are outcome measurements important for documenting how a patient is responding to care, but they are a reliable way to communicate with other health care providers, managed care reviewers, attorneys and especially our patients. They are ideal for establishing treatment goals and shifting a patient’s care from passive to active.

Outcome management tools have been around for well over a decade now. If you still have not incorporated them in your treatment protocol, now is time to start. If you already use outcome assessment tools, continue to use them on every patient.

To get more information on outcome measurements, attend an ICS document and coding class.