Better Business Intelligence: Enhanced CPT Code Analysis

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This article is the first in a two-part series about how radiology practices can derive superior business intelligence from their existing coding and payment data. Greg Thomson, CPAJana LandrethHistorically, radiology practices have looked at CPT® code volume as a measure of work. As Greg Thomson, CPA, executive vice president of Medical Management Professionals, Inc (MMP), Atlanta, Georgia, explains, “It is the widget we have used to measure the work performed by our physician clients, and also a measure of the work performed in the billing office.” Thomson and his colleague Jana Landreth, CPA, MBA, would argue, however, that there are better ways to measure physician work—and that practices are often neglecting to pursue the full range of business intelligence available from analysis of these kinds of data. Landreth, who is director of practice management for MMP, says, “CPT codes have historically been looked at in the aggregate. Perhaps you would break it down as far as total CT codes or total MRI codes, but the analysis did not look at how many individual codes you were performing, or what the trend was there.” Instead, Thomson says, practices have traditionally focused on CPT codes as a means of measuring radiologists’ work, misusing potentially valuable data. “We are transitioning to better measures of work or time spent,” he says. “When you look at how specific lines of work break down within the practice, however, it is revealing.” The Total CPT Code Illusion Landreth notes that the radiology industry is “comfortable with total CPT codes—under a modality, under a payor grouping, and so forth,” she says. Typically, an individual practice would look at how total CPT code volume within those wide parameters had changed over time to identify trends. She adds, “It has always been true that when looking at total CPT code volume, you cannot compare two practices because of the case mix. All CPT codes are not created equal, and they never have been.” Radiology practices were able to skate by, in the past, merely by looking at total CPT code volume because the marketplace was not as complex or competitive as it is today, Landreth suggests. “What is happening to many practices now is much more complicated than ‘Oh, our Blue Cross Blue Shield volume is down,’ or ‘We are doing fewer CTs,’” she says. “What is happening now is more complex than 10 (or even five) years ago. It can make diagnosing a practice issue dangerous—and you could completely miss a serious problem by looking at total CPT code volume alone.” As an example, Landreth cites the controversial 2011 code change for CT of the abdomen and pelvis. “The number of CPT codes associated with the procedure has changed for the same amount of work,” she notes, meaning that practices will not be able to trace trend changes between 2010 and 2011 effectively, in these procedure lines, solely by looking at total code volume. “You could have a change in your patient population happening at the same time; with an aging patient population, more people are going on Medicare,” she continues. “We are also seeing a change in where practices’ business is coming from—perhaps a greater percentage is coming in from the emergency department, which may have lower reimbursement associated with CT. When you see your total CPT code volume for CT, it will be flat—but your reimbursement will be down instead.” In news that will be music to practice managers’ ears, Landreth says that today’s radiologists are ready to handle the complexities of better business intelligence. “Radiologists are more interested in this now,” she notes. “They are seeking to understand what is happening and to recognize what they can do to intervene.” Better Intelligence Landreth recommends that practices dive into their billing data to execute more sophisticated analyses of CPT code volumes. “The good news is that most practices, thanks to improvements in billing technology, can access this information very easily,” she says. “Their billing company or managers should be able to get this for them. The information exists now and is available.” Thomson says that practices can start by running a typical CPT code volume report, by payor, over different periods of time, so they can better understand what happened in the past—with an eye toward identifying what will happen in the future. “Run this report for the first time, and it is relatively meaningless,” he notes. “Trending over time is extremely valuable.” Cross-referencing different CPT code volume reports—by modality, by payor, by referrer, and so on—will enable practices to spot vulnerabilities and opportunities that might not otherwise have been evident, Landreth and Thomson say. “Imaging centers and hospital-based groups alike may see that a referrer has stopped sending a particular exam to their facility, and they will be able to find out why—and what they can do to address the issue,” Landreth says. “Hospital-based radiologists may see that referring physicians have started sending patients elsewhere. Maybe there has been an erosion of what the radiologist (versus another specialist) provides.” Practices could take the information that they have gleaned and compare themselves with peers to see whether they are performing the same number of exams per modality and are garnering the same number of referrals per specialty area. Where deficiencies exist, they might ask, “Is it because I have not educated the referring physicians on it, or is it because I have not gone through the training?” Landreth says. “If you have a colleague who would be willing to compare this kind of information, you can take it to the next level.” Practices can also feel empowered to make the more judicious decisions required by today’s difficult reimbursement environment, Thomson says. “This enables practices to take a much closer look at their needs and to say no a little more,” he observes. “In the past, practices were growing at very rapid rates, and adding a radiologist was a matter of course. Now, practices must look closely at their volumes to understand whether a perceived need is justified by the data.” He concludes, “The pressures groups are under now make understanding their business to this degree vital. The margin for error is smaller now. There will be winners and losers in radiology, going forward, whereas in the past, it was almost all winners.” Cat Vasko is editor of and associate editor of Radiology Business Journal.