Analytics improves the accuracy of documentation, ensuring that not only are plans paid for all the services providers legitimately rendered, but they are not paid for things for which they shouldn’t be paid.

For years, the Centers for Medicare and Medicaid Services’ (CMS) approach to documentation errors has been much like the parent who screams about the horrific punishments his or her children will receive if they don’t behave, but who never follows through. It doesn’t take long for the kids to realize it’s just an idle threat, and they can continue doing whatever they were doing without worry.

That is no longer true. CMS is now applying a “tough love” approach to Medicare Advantage (MA) plans that has many scrambling to get their houses in order quickly. Essentially, the agency is saying if it is seeing a 30% error rate in reporting, it will perform a 30% adjustment to reimbursement. More importantly, like the parent who has had enough of the kids and their poor behavior, CMS is following through.

What has made this shift particularly urgent to MA plans is just looking for information that may have been missed is only a part of the equation; it also includes items that have been reported that shouldn’t have been, as well as treatment or conditions that have been reported but not properly documented. That opens up a whole new area of risk.

Problems with documentation

The most common reason documentation is incorrect or incomplete is a lack of education and understanding of what constitutes sufficient documentation. Physicians go to medical school to learn how to treat patients, not submit documentation about it. They learn how to fill out a chart or a progress note on the job, but there is no class on how to link a retinopathy to diabetes. If further training is required, it mostly occurs in one-to-one meetings looking at very specific situations after a chart review. As a result, there is a tremendous variation in quality and completeness of the education.


Another cause of documentation problems is the use of old documentation tools, such as NCR forms which do not track to the new codes that are developed each year. Someone makes the decision to continue using the NCR form because there are still 10,000 of them around the office, and everyone is familiar with them. Yet the documentation may not be in alignment with the treatment, and for CMS if it isn’t documented it didn’t happen. The same thing can occur with software if it isn’t maintained properly when new codes are released.

A third cause may be physicians who are used to documenting encounters a certain way. The transition from ICD-9 to ICD-10 involved quadrupling the number of codes to increase specificity. Physicians who are still using ICD-9 codes may be creating issues that will cause MA plans to be penalized if a problem isn’t recognized.

Finally, in rare instances, physicians may be coding for Hierarchical Condition Categories (HCC) rather than the treatment they performed for the member, again due to lack of education.

What’s important to understand is the reason doesn’t matter to CMS—only that the problem exists. Now that it appears CMS is serious about targeting every health plan every four years (rather than just looking for random, out-of-the-norm trends), and in one instance has already imposed penalties, MA plans of all sizes are working hard to ensure they are not the next to feel the sting of reduced payments.

The value of a chart validation service


To solve these issues, many MA plans are turning to chart validation services that specialize in confirming that the procedure and diagnosis codes are aligned with the treatment performed. These services go beyond ordinary chart vendors by using analytics to improve the accuracy of documentation, ensuring that not only are plans paid for all the services providers legitimately rendered, but they are not paid for things for which they shouldn’t be paid.

By analyzing a pool of diagnostic codes that track to HCCs, and comparing them to benchmarks for that population, the analytics can uncover unusual occurrences in coding such as a higher-than-normal level of chronic obstructive pulmonary disease (COPD). The payer can then run a report that analyzes historical diagnostic information. If certain patients were diagnosed as having COPD but never coded or treated for it again, it could indicate a mistake on the original chart.

In short, the analytics of the charting validation service will be able to do what no department of humans can do – review every chart and find the anomalies that indicate problems with diagnostic codes or HCCs so they can be corrected before CMS sees them—and starts assessing penalties.

In addition to correcting the immediate issue, a chart validation service can also help remediate issues at the source. Most documentation issues trace back to physicians who are used to doing things a certain way, or don’t understand the intricacies of documentation. By highlighting areas of recurring issues, MA plans can have their medical directors approach physicians to re-train them on complete and accurate documentation thus avoiding the problem.

Improving quality performance


In the quality world, February is an important month because that’s when the National Committee for Quality Assurance (NCQA) typically freezes the reporting database. MA plans that perform chart audits can add to the data, but for all intents and purposes, whatever is there when it’s frozen is the data plans must live with for reporting. If a population of diabetics is missing HbA1c labs, or a population of women over 50 is missing mammograms for the current year, the MA plan loses out on those quality measures unless they begin laborious chart reviews.

Because it works with near-real time analytics, a chart validation service can alert MA plans to missing information before the year ends and data is frozen, thus allowing for corrective actions to be taken, either by the plan or the providers. The data is then more robust, as are the resulting payments.

Having more complete information with Medicare also helps MA plans increase their star ratings, making them more appealing to potential members during open enrollment periods when potential members are comparing plans.

Day of reckoning

After years of threats, it appears the day of reckoning around accurate documentation has arrived. All MA plans will be held accountable for ensuring everything is in order.


A chart validation service can simplify and automate the process, catching individual issues while also uncovering recurring ones so they can be remediated to the betterment of all. It’s the best defense against the “tough love” approach—and a better way to run an MA plan.

Thomas Peterson is senior vice president, risk adjustment, with SCIO Health Analytics, and has more than 25 years’ experience in healthcare. In his role with SCIO, Tom leads operations in Westlake Village, Calif., overseeing the strategic direction and IT innovation to ensure growth and alignment with evolving industry needs.

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