November 7, 2005
Your Personal Health Record: Diagnostic and Financial - Part 1
M.J. McKeown, MD, FACOG, FACS
There are many articles and books on the subject of keeping one's personal health record. In theory the new national trend is toward electronic medical records with some system of a nationally accessible summary record. This summary record is supposed to contain essential medical data on a person such that if they appear in a hospital emergency room or a clinic they do not usually go to there will be a basic amount of data available to tell the emergency room or clinic of life threatening diseases, necessary medications or medical allergies.
There are many hurdles to overcome before this universal electronic medical record is useful. There are so many hurdles that it may never be as informative as now envisioned.
There are several personal medical record systems available. These systems are designed for the user to maintain a written record of illnesses, medications, treatments, immunizations, and imaging studies.
However none of the systems give advice, supply forms, or discuss obtaining the essential language of all this information. This language consists of the code number systems used by all of the business side of healthcare. The physician does not tell the insurance company that a wart was taken off your hand. The physician uses a code number for the diagnosis of the wart and another code number for the procedure being billed. The insurance company maintains a list of acceptable code numbers for which they will pay a certain amount. The physician needs to learn the combination of diagnosis code number and procedure code number any given insurance company will allow for the treatment done. All insurance companies do not use the same combinations. All insurance companies change the acceptable combinations over time. All insurance companies change the acceptable diagnosis code that will enable a physician to get paid for a procedure done. This forest of codes and charges that change with time means that the physician of today needs to hire a skilled coder to get paid for what is done. The coder needs to tell the physician what dictated verbiage needs to be in the medical record to support the combination of codes used. It is not unusual for an insurance company to change the requirements in any given situation if they seem to be paying out more than they like for a given diagnosis. The coder and the physician will discover this when the insurance company sends them a bulletin or when a formerly acceptable charge is denied.
- There is another concept developed by the insurance company in the payment for a procedure done. This is the term, usual and customary. This is to allow the company to say that the amount they will pay for any procedure is the usual and customary amount they have found being billed for that procedure. Frequently the allowed amount varies by geographic location in the country in general or varies between urban and rural within a geographic area. Insurance companies by calling this usual and customary do not hesitate to inform those covered by it that the physician seen was charging more than the usual and customary and thus imply the physician is overcharging. It is hard for a physician to say to a patient that the amount charged for a procedure meets national standards when the insurance company has just implied to the patient that the physician is a cheat. It is informative to learn how the insurance company calculates this magic dollar amount. In one documented instance the procedure was as follows:
- 1. Gather all the charges submitted from a given geographic area for a given procedure over a certain time period.
2. Sort these charges from least amount charged to highest amount charged.
3. Select the first 100 charges beginning with the lowest and add them together
4. Divide that by 100 and call that the usual and customary.
It is easy to see that this method will always produce a low end amount. See Your Personal Health Record: Diagnostic and Financial - Part 2
This all may seem a dance of subterfuge on the part of healthcare providers. However if one examines the breakdown of the costs of healthcare in the United States the first place the payors go to save money is to decrease the amount they will allow for any given visit or procedure. They are able to do this because they are the payors that provide the income for any healthcare provider. If one looks at a health plan with care there is usually a list of accepted and covered providers for the plan. The discussion likely goes on to give a percentage of payment of any given bill for an accepted provider and then a lesser percentage or perhaps no payment at all for out of plan providers. There is usually no mention of coverage for the provider entity's business costs such as secretarial help, nurse help, technician help and etc. However figures for one recent year show that the absolute dollar cost of healthcare did not rise however the percentage of that dollar that went to actual providers went down by 17% and the amount that went for administration went up by 17%.
With all of these various financial forces at work and since they can change from year to year or even month to month it is easy to see that just finding out what the provider billed and what the insurance plan paid does not tell the whole story.
Keeping an up to date personal health record for you and your family is excellent planning. Having these available if you find need of healthcare services away from your usual providers may be life saving. The entirety of the health record will grow to be too large to always carry with one. However it is wise to carry a summary of major illnesses, major surgeries, medications taken and any medicinal or other allergies.
The more extensive records with all the codes will keep a record of what the system used in the codes it talks. The linkages of codes and charges and payments will allow you to catch any misuse of the system by either the providers or the entities paying the bills. Once you have all this data it is easier to check with the coverage discussed in the insurance policy and what you actually had to pay. Remember to always demand a copy of the actual health care insurance policy not just some benefits pamphlet provided. Once you have a copy of the actual contract then read the fine print to be sure you understand the policies of the insurance company. In regard to Medicare and other State or Federal health insurance coverage be especially sure to read all the fine print. If the private or governmental insurance companies you are involved with offer to have you sign up to receive information bulletins be sure and do so! Remember that the area of health care insurance is especially one where Caveat Emptor (buyer beware) applies.