The Health Insurance Portability and Accountability Act of 1996 (HIPAA) mandates that Volume 3 of the International Classification of Diseases, 9th Revision, Clinical Modification (ICD-9-CM) be used to code inpatient services on medical claims.

While most professional medical coders and medical billers use the diagnosis codes in ICD-9-CM every day, the code manual also contains a series of codes used to describe medical procedures. All editions of ICD-9-CM contain Volume 1 and Volume 2. Expert editions of ICD-9-CM, designed for use by hospitals and payers, also contain Volume 3, which is dedicated to procedural coding.

Because Volume 3 codes are used exclusively in the inpatient setting, certified medical coders who are fluent in using them are specialists in their field. Medical billers and medical coders who do not use these code sets regularly have still been trained in their use. A solid, well-rounded education is what professional medical coders and billers bring to their jobs, applying a consistent philosophy to coding that governs every medical claim for payment.

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Organization of ICD-9-CM Volume 3

ICD-9-CM procedure codes are two numeric digits followed by a decimal, which is then followed by another one or two digits. The codes begin with 00.01, to describe a therapeutic ultrasound of vessels in the head and neck, and they end with 99.99, which describes other miscellaneous procedures. ICD-9-CM indicates that leech therapy falls under 99.99. Being able to read and understand the code manual is an asset for hospitals to submit accurate claims for accurate reimbursement.

The majority of Volume 3 of ICD-9-CM is arranged by anatomical location. After the codes that start with 00, which cover procedures and interventions not classified elsewhere in Volume 3, the codes run in progression to describe procedures and interventions at different sites and through different constitutional systems. Codes that begin with 01 through 05, are defined as operations of the nervous system, while codes that begin with 06 or 07 are operations of the endocrine system.

Like Volumes 1 and 2, ICD-9-CM Volume 3 provides specific definitions of each procedure being described. For example, 06.2 is used to describe a unilateral thyroid lobectomy. ICD-9-CM makes a point of saying that 06.2 should not be used to describe a partial sub-sternal thyroidectomy, which is more accurately described by 06.51. The isthmus is not considered a lobe, and when the isthmus is removed, the code used to describe that procedure is 06.39.

By understanding the terminology employed in ICD-9-CM, and by understanding the documentation in the patient’s medical record, certified medical coders assign the code that matches what was performed. Being able to bear all the code variations in mind while reviewing medical records and assembling claims, professional medical coders and medical billers reduce fraud and abuse of the healthcare reimbursement system, limiting a hospital’s legal exposure to charges of the same.

Uses of ICD-9-CM Procedure Codes

The Center for Medicare and Medicaid Services (CMS) which administrates the implementation of HIPAA, has offered clear guidance that Volume 3 procedure codes are only to be used in the inpatient setting to obtain reimbursement. CMS states that hospitals can use Volume 3 codes for internal tracking purposes, but the HIPAA standard is to use Healthcare Common Procedure Coding System (HCPCS) codes in every other setting when financial transactions take place with third-party payers.

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Not all procedures that are performed in a hospital are inpatient services. Patients who receive services on an outpatient basis, such as walk-in laboratory tests, have their healthcare claims submitted with HCPCS codes to describe the services received. Inpatients are patients who are admitted to the hospital and stay at least overnight. Patients can be admitted to a hospital overnight solely for observation. Any services these patients receive are described by the use of HCPCS codes because they do are not in an inpatient treatment status.

All procedure codes are attached to specific charges that a hospital has determined represents its reasonable cost to perform the service. Hospitals are paid according to Diagnosis Related Groups (DRGs) for inpatient services, but diagnosis codes are not, themselves, associated with charges. By using ICD-9-CM Volume 3 codes, hospitals establish the amount owed for a specific inpatient encounter, while the DRG assigned to the patient’s inpatient stay determines the payment.

By reporting ICD-9-CM procedure codes, and their associated charges, Medicare, Medicaid, and other third-party payers can examine past claims and adjust the DRG reimbursement rates according to the costs incurred. Accurate coding affects not only a specific medical claim, but also the reimbursement system as a whole when all the claims are analyzed in aggregate.

Appropriate Use of ICD-9-CM Volume 3

In the medical office setting, most billing software is loaded with a database of the complete set of ICD-9-CM codes, both diagnostic and procedural. Even if they are not appropriate, Volume 3 codes are available to medical billers and medical coders in the outpatient setting.

Properly trained and certified medical coders and professional medical coders recogize the difference between Volume 3 codes and HCPCS codes. They also recognize the difference between ICD-9-CM codes that have two primary digits and those that have three. Those that have two primary digits are procedure codes that have no place in any setting that is not inpatient care.

Inexperienced medical coders, including physicians and other healthcare providers, are tempted to use Volume 3 codes because the codes do accurately describe services. An outpatient medical claim, a claim from a Skilled Nursing Facility (SNF), or a claim from an Ambulatory Surgery Center (ASC), does not make sense when it contains Volume 3 ICD-9-CM codes. The claim will be denied coverage and payment because the coding language used cannot be deciphered in this particular situation. It will need to be recoded and resubmitted, costing man-hours and lost time to recoup the correct reimbursement.

With training from a formal, credential program, professional medical billers and certified medical coders recognize when specific coding systems should be used. There are rules to assigning medical codes that are established by federal statute, such as HIPAA, as well as by the Patient Protection and Affordable Care Act of 2010 (PPACA).

As the provisions of the PPACA come into effect, the regulatory atmosphere surrounding medical coding will become more complex. PPACA mandates that ICD-9-CM be replaced by ICD-10 in 2013. Medical coders and billers who have a solid understanding of ICD-9-CM are expected to make a smooth transition to the new coding system. ICD-10-CM, which will replace Volume 1 and Volume 2 of ICD-9-CM, and ICD-10-PCS, which will replace Volume 3 of ICD-9-CM.

Both the American Academy of Professional Coders (AAPC) and the American Health Information Management Association (AHIMA) predict that minimal training will be needed for experienced medical coders and medical billers to make the switch from ICD-9-CM to the more specific, and extensive. ICD-10 system. With the PPACA deadline approaching, employers are looking for personnel with formal credentials to fill medical billing and coding openings. Formal education is viewed as evidence that billers and coders can master the material needed to perform their jobs accurately and effectively, in order to obtain maximum legal reimbursement for provided services.