In last week’s article I mentioned that I’d be talking more about revenue codes this week. I touch upon revenue codes twice in a row because, though many people aren’t sure what it is, before I shut down my medical billing website, this was the largest area of concern for visitors and those with questions.

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Therefore, I’m going to make an assumption that there’s a lot more information some folks would love to learn about them, other than the quick synopsis I put in that article. Therefore, I’m going to address 5 things about revenue codes that people might not know, mainly because 5 seems to be a magical number. This won’t answer everything, but it will serve two purposes. One, it’ll hopefully give you a bit more to work with; two, it’ll hopefully get some of you to request my assistance with a bit of consulting. Such is the nature of business; let’s get to it!

1. There are many revenue codes that can be billed for more than one service.

One of the initial problems I’ve seen with new medical billing software vendors is that they set their systems up to not only default everything to one service, but make it difficult to override. That’s patently ridiculous and, if allowed to stay, will mess up billing and thus revenue.

For instance, there are a lot of lab services that have to be charged multiple times. CPT-4 code 86003 is used for allergy tests, and for some patients it could be run more than 100 times. It would go under revenue code 302. If there were other services that could go under 302, like many other codes beginning with “86”, they’d be on the same revenue code line and the number would just jump higher. As an addition, since they’d all use the same revenue code, price them the same; it’s the smart thing to do.

2. There might be times when similar services can go under multiple revenue codes.

The revenue code for surgery is 360. However, if you have a stand along surgery center then the same service would be coded 490. If it’s an endoscopic procedure but not done in surgery, and your hospital has a contract to pay those services differently, you can code it 750. I touched on this in the previous article.

Revenue codes can be changed depending on where a patient might have a service performed or by contractual agreement with insurance companies. In some facilities, many charges are coded with the generic code as opposed to a more specific code under the same category. Whereas I always recommend being specific, if it doesn’t serve a particular need it might not be necessary.

3. Never use a revenue code that doesn’t quite fit to get payment you might not deserve.

Years ago at one hospital a CFO wanted me to code some OB-GYN services under a clinic revenue code. When I asked why he said because he knew what they would pay. I said that was illegal and refused to do it unless he signed a letter I would draft agreeing that I said it was illegal and he wanted to do it anyway; he backed down.

I run into billing departments all the time where people change revenue codes just to get paid. That’s fraudulent because there’s no record of why they made the change, so the assumption, which is true, is that a change was made only to get paid. Always verify information; reasons for not getting paid can be numerous. If you don’t believe me, just look at an average explanation of benefits and note the different denial codes.

4. Make sure you understand the terminology of a revenue code before you use it.

Years ago at one hospital I was consulting at, I noticed a lot of very expensive charges going to revenue code 278, which is used to denote implants. I went to find someone to explain this to me. I was told that an agreement had been made to pay 50% of any charges regarding “transplants”. I said that transplants were in the 810 range, not 278; two totally different things.

It was my bet that the insurance company had said 810 and other codes in that range rather than 278. Since there were no charges coded with 810, and the insurance company had to know what their agreement was, they never questioned anything because it would have saved them a lot of money. I changed all the implants to the proper code. I’m not sure what the direct result was, but since the hospital started bringing in a lot more money, I assume it was a contributing factor.

5. Most hospitals shouldn’t bill using physician revenue codes.

At another hospital, they had problems getting their compensation claims paid. When I reviewed their charge master, I found that 75% of their charges in their physical therapy department were using revenue codes in the 980 range, which are for professional services usually performed at critical access hospitals. Most physician billing doesn’t use revenue codes in their billing; that was a major red flag.

In this case, the procedures were being performed by therapists, and many of the services were physical and occupational therapy, which are in the 420 & 430 revenue code range. The compensation carriers knew this, so they were denying all claims for the wrong code. However, since billing personnel didn’t know what the denials meant, and the person in charge of the charge master didn’t understand coding, it was an error that had been going on for years. Imagine the dollars they lost over the course of all those years; imagine how much they probably brought in once I left.

Using the proper revenue codes can not only potentially help increase revenue and cash, but can help keep your hospital in compliance. That’s why it’s recommended to have a charge master review at least once a year; with the average being 3-7 years, your hospital could be losing a lot of money without one.
 

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