Outpatient CDI is the right idea, but the wrong label

August 27th, 2018 / By Kristine Daynes

As the volume of outpatient care has grown over the past several years, so has interest in outpatient clinical documentation improvement (CDI). Yet many organizations struggle to define what exactly outpatient CDI is and how it improves revenue.

There is no standard map for the terrain of outpatient CDI. What are the boundaries—only hospital outpatient services? What about observation and emergency department (ED)? Physician services in the ED? Should it reach as far as system-owned physician clinics and practices? The answer could be yes to any or all of them, encompassing ambulatory and professional services. The term “outpatient” doesn’t adequately cover the full effort.

Part of the challenge is that CDI in the outpatient setting is not the same as inpatient CDI. Another challenge is the label itself. The term “outpatient” doesn’t adequately encompass the full effort.

Not the same as inpatient CDI

Aside from the label, outpatient CDI is challenging because it cannot simply replicate inpatient-oriented CDI processes. The differences between inpatient, outpatient, ambulatory and physician practices need to be considered in setting up an outpatient CDI program:

Timing. With inpatient CDI, there is time to review charts and query physicians during a patient’s hospital stay, which can last two or more nights. Outpatient care happens at a much faster pace—in minutes and hours, not days—leaving little time for concurrent CDI. Professional claims may not ever be touched by someone with coding credentials, but might pass from the physician coder directly to the bill.

Objective. Inpatient CDI programs have a strong focus on capturing comorbid conditions that accurately reflect severity of illness to sustain case mix index. By comparison, most outpatient CDI focuses on capturing all charges and reducing denials.

Regulation. Outpatient departments, ambulatory facilities and physician practices fall under distinct payer rules. Because of this, outpatient coding teams are often separate from inpatient teams and trained for different specialties. Likewise, outpatient CDI can require a degree of specialization.

Code sets. Inpatient care is coded with ICD-10 and DRGs, and payment depends on diagnoses matching the procedures performed. On the other hand, outpatient and professional services use primarily HCPCS/CPT and APC code sets, and reimbursement depends more heavily on the procedures reported on the claim, as long as the diagnosis supports medical necessity for the reported service.

Billing forms. The claims for physicians and other medical practitioners (CMS-1500) are different from facility billing forms (UB-04).

Settings. Some encounters may involve multiple settings over a relatively short time period, as when a patient received through the ED is admitted as an inpatient after several hours in observation.

Volume. Although inpatient services represent the bulk of hospital revenue, the sheer volume of outpatient and ambulatory visits far outnumbers inpatient care. That can make it hard to decide where CDI efforts have the greatest impact.

More than CDI

While inpatient care allows time for concurrent CDI, outpatient care is better suited to CDI activities done before (prospective) and after (retrospective) the patient visit. For example, charts might be reviewed prospectively to:

  • Identify chronic conditions that need more specificity or a status update
  • Make sure problem lists are complete
  • Prepare for preventive E/M services, which can require additional time during the visit to schedule screening tests and update the status of active conditions
  • Ensure LCD and NCD coverage criteria are met for scheduled outpatient surgeries, diagnostic testing, and injections/infusions

Retrospective outpatient CDI helps detect problematic trends and correct them through education or process improvement. Examples include:

  • ED documentation reviews to ensure appropriateness of diagnostic testing (medical necessity) and proper patient status
  • Chart reviews of patients placed in observation to ensure appropriate site of service determination and consistency between facility and provider documentation/claims
  • Comparison of coded outpatient facility records against submitted claims to verify proper sequencing of HCC diagnoses for billing
  • Audits of facility documentation and coding for appropriate ICD-10 specificity, APC assignment, CPT codes, and assignment of modifiers
  • Chart reviews of professional services for appropriate E/M levels of severity, CPT codes and assignment of modifiers
  • Ambulatory and physician clinic chart reviews to identify missing charges, such as injections/infusions and lab tests
  • Analysis of submitted claims and remittance advice to identify factors contributing to payment delays, denials and write-offs

Getting started

Outpatient CDI can feel overwhelming for teams that are just starting. Fortunately, we can draw on the experience of organizations we have worked with and analyze approaches to outpatient CDI programs than provide a good template for others.

Typically, organizations, often working with CDI consultants, begin by prioritizing the facilities, departments and/or service lines where CDI efforts can have the greatest impact. CDI consultants review twelve months of claims data, with close attention to charges and denials. Then they review a sample of charts to assess things such as unresolved medical necessity and NCCI edits, missing charges for injections and infusions, missing or unspecified HCC diagnoses and reporting of time-based services.

Once they have a general sense of what issues an organization faces, the CDI consultants interview CDI and coding staff, nurses and physicians to map workflow. This operational assessment informs process improvement, education and policy changes. Once these components are implemented, the CDI consultants perform regular audits and claims analysis to monitor operational and financials metrics.

Kristine Daynes is senior product manager at 3M Health Information Systems.


Discover more about outpatient CDI.