Health and Medical News and Resources

General interest items edited by Janice Flahiff

coding answers

From the 7 January 2015 Medical Economics article

The new year brings changes to many evaluation and management codes physicians use, including chronic care management and advanced planning

Read the entire article here

July 25, 2015 Posted by | health care | , , , , , , | Leave a comment

[Reblog] The Smoking Gun: How U.S. Health Care Came to Cost Insanely More

From the 20 May 2015 post at The Health Care Blog

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Health care that costs more than it needs to is not just an annoyance; it’s a big factor in income inequality in the United States. The financial, physical and emotional burden of disease are major drivers of poverty. At the same time, the high cost of health care even after the Affordable Care Act means that many people don’t access it when they need it, and this in turn deprives large swathes of the population of their true economic potential as entrepreneurs, workers and consumers. People who are burdened by disease and mental illness don’t start businesses; don’t show up for work; and don’t spend as much money on cars, smartphones and cool apartments. Unnecessary sickness is a burden to the whole economy.

How did we get this way? What was the mechanism that differentiated U.S. health care from all other advanced countries? The usual suspects (such as “We have the most sophisticated research and teaching hospitals,” or “It’s the for-profit health insurers” or “Doctors make too much”) all fail when we compare the United States with other sophisticated national systems such as those in Germany and France. Other countries have all of these factors in varying amounts — private health insurers, world-class research, well-paid physicians — and cost a lot, but still spend a far smaller chunk of their economy on health care. Blame has been leveled in every direction, but in reality no single part of health care has been the driver. The whole system has become drastically more expensive over the last three decades.

What’s the Mechanism?

Since the difference between the United States and other countries is so large and obvious, there should be some way we can look at health care spending that would make that mechanism jump out at us. And there is a way.

That first big leap is between 1982 and 1983. What was different in 1983 that was not there in 1982? DRGs, diagnosis-related groups — the first attempt by the government to control health care costs by attaching a code to each item, each type of case, each test or procedure, and assigning a price it would pay in each of the hundreds of markets across the country. The rises continue across subsequent years as versions of this code-based reimbursement system expand it from Medicare and Medicaid to private payers, from inpatient to ambulatory care, from hospitals to physician groups and clinics, to devices and supplies, eventually becoming the default system for paying for nearly all of U.S. health care: code-driven fee-for-service reimbursements.

Cost Control Drives Costs Up?

How can a cost control scheme drive costs up? In a number of ways: In an attempt to control the costs of the system, the DRG rubric controlled the costs of units, from individual items like an aspirin or an arm sling to the most comprehensive items such as an operation or procedure. The system did not pay for an entire clinical case across the continuum of care from diagnosis through rehab; or for an entire patient per year on a capitated basis, which would capture the economic advantages of prevention; or for an entire population. While it is more cost-effective (as well as better medicine) to provide a diabetes patient with medical management, in-home nursing visits and nutritional counseling rather than, say, waiting until the patient needs an amputation, the coding system actually punished that efficiency and effectiveness. Under this system, we got paid for our inefficiencies, and even for our mistakes: Do-overs would often drop far more to the bottom line than the original procedure did.

The system punished, rather than rewarded, spending more time with patients, trying to help patients before their problems became acute, or maintaining a long-term, trusted relationship with patients. Under a code-driven fee-for-service system, getting serious about prevention and population health management would be a broad road to bankruptcy.

If extra items were deemed necessary (an extra test or scan, say), there were codes for that, and reimbursements awaiting. In so doing, the system rewarded doing more (“volume”) rather than whatever would be the best, most appropriate, most efficient treatment path (“value”). It provided a written, detailed catalog of reimbursements which rewarded diagnoses of greater complexity, rewarded new techniques and technologies with new and usually higher reimbursements, and especially rewarded systems that invested in a greater capability to navigate the coding system. At the same time, the reimbursements were constantly open to pressure from the industry. Each part of the industry, each region, each specialty, each part of the device industry, became fiercely focused on keeping those reimbursements up, and getting new codes for more costly procedures.

The business and strategic side of health care became a matter of making money by farming the coding system. Do more of what gets better reimbursement, less of what does not. Make sure every item gets a code and gets charged for. The codes became a manual for success, a handbook for empire.

The Smoking Gun

The smoking gun is right there in the chart, at the big split between the trajectories of the United States and other countries. And today, at this moment, the code-based fee-for-service payment system is still by far the basis of the majority of all revenue streams across health care.

The unifying factor between multiple new strategies unfolding in health care right now, including patient-centered medical homes, pay for performance, bundled prices, reference prices, accountable care organizations, direct pay primary care and others, is to find some way around the strict code-based fee-for-service system, either by avoiding it entirely or by adding epicycles and feedback loops to it to counter its most deleterious effects.

There is no perfect way to pay for health care. All payment methods have their drawbacks and unintended consequences. But the code-based fee-for-service system got us here, and any path out of the cost mess we are in has to get us off that escalator one way or another.

May 23, 2015 Posted by | health care | , , , , , , | Leave a comment

Diagnostic Codes & Misleading Clinical Assumptions (Explains Why Pneumonia Cases Were Underreported Nationwide)

Bottom line…an author had used codes which underreported pneumonia cases by not taking into account diagnoses where pneumonia was a secondary diagnosis


From NLM Director’s Comments Transcript
Diagnostic Codes & Misleading Clinical Assumptions: 05/29/2012

Purported declines in pneumonia hospitalization and mortality rates were misleading because a standardized clinical diagnostic coding system was interpreted one-dimensionally, find an illuminatingstudy and an accompanying editorial recently published in the Journal of the American Medical Association.

Both the study and the editorial suggest subtle revisions in the use of diagnostic codes and related reimbursement procedures can impact hospital data and alter inferences about patient results as well as the quality of health care provided by U.S. hospitals, clinics, and health care providers….

n the study, five authors initially found a 27 percent decline in hospitalization and a 28 percent decline in mortality rates from pneumonia during 2003-2009 by using a patient results database that is undergirded by a nationally used diagnostic code system. The coding system is called the International Classification of Diseases, Ninth Revision, Clinical Modification, which is often referred to as ICD-9-CM. ICD-9-CM is used by hospitals, clinics, and health care providers nationwide to code patient diagnoses and is a foundation for administrative and patient records as well as insurance billing.

The study’s authors explain the Nationwide Input Sample (grounded in ICD-9-CM diagnostic codes) suggested there were significant improvements in hospitals and clinics across the U.S. in the treatment of pneumonia, which also were reported in other, smaller studies.

However, the study’s authors checked the identical dataset for hospitalization rates by using a more multidimensional definition of pneumonia within ICD-9-CM codes. The authors asked how many patients were diagnosed with sepsis and respiratory failure with a secondary diagnosis of pneumonia during the same time period? The authors found the hospitalization and respiratory rates increased by 178 percent and nine percent respectively for patients diagnosed with sepsis and respiratory failure with a secondary diagnosis of pneumonia.

When the study’s authors then combined a primary and secondary pneumonia diagnoses from the same dataset, they found an overall 12 percent decline in pneumonia-related admissions and a six percent increase in mortality occurred from 2003-2009. In other words, the addition of two other codes for pneumonia diagnoses partially refuted the initial reports of highly reduced hospitalization and mortality from pneumonia.

The study’s authors write (and we quote) ‘the results suggest that secular trends in documentation and coding, rather than improvements in actual outcomes, may explain much of the observed change in this and other studies’ (end of quote).

The study’s authors explain the current research is the first to assess hospitalization and mortality rates using a multidimensional diagnostic definition of pneumonia.

Similarly, the editorial’s authors write and we quote): ‘nuances in the assignment of principal and secondary diagnoses (in ICD-9-CM codes) can also affect assessment of hospital performance’ (end of quote).

Among other examples, the editorial’s authors add the use of sepsis as a diagnosis among patients with pneumonia may have increased significantly from 2003-2009 because the reimbursement potential for sepsis (based on diagnosis related groups) was higher than pneumonia during this period. The editorial’s authors write (and we quote): ‘Under prospective payment, there is a wide variation in reimbursement for different diagnosis related groups (DRGs), creating incentives to identify principal diagnoses associated with higher reimbursing DRGs’ (end of quote).

While the editorial’s authors acknowledge ICD-9-CM codes and DRGs (as well as other, related information) make it easier to use administrative data to assess health care delivery and quality of care, they underscore it is important to judiciously interpret the methods and findings. The editorial’s authors conclude (and we quote): ‘the potential for misleading interpretation of findings based on naïve analysis of administrative data and a lack of appreciation of the nuances in diagnostic coding will continue to be a problem’ (end of quote).

Meanwhile,’s health insurance health topic page provides insights into the bottom line byproduct of diagnostic codes that impactpatients and health consumers — how to pay for a provider’s or health organization’s charges.’s health insurance health topic page provides two overviews of health insurance from the American Academy of Family Physicians in the ‘start here’ section. A helpful guide to 10 ways to make health benefits work for you (from the U.S. Department of Labor) also is available in the ‘start here’ section.

A website from the American College of Physicians and the American Association of Retired Persons (available in the ‘related issues’ section) helps you understand some of the pending changes in health insurance associated with the comprehensive health care law the U.S. Congress passed in 2010.’s health insurance health topic page additionally contains updated research summaries, which are available within the ‘research’ section. Links to the latest pertinent journal research articles are available in the ‘journal articles’ section. From the health insurance health topic page, you can sign up to receive email updates with links to new information as it becomes available on MedlinePlus.

To find’s health insurance health topic page, type ‘health insurance’ in the search box on’s home page, then, click on ‘health insurance (National Library of Medicine).’ also contains related health topic pages on: Financial Assistance, Managed Care, Medicaid, Medicare, and Medicare Prescription Drug Coverage.

Before I go, this reminder……. is authoritative. It’s free. We do not accept advertising …and is written to help you.



June 4, 2012 Posted by | Health Statistics | , , | Leave a comment


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