Medical Billing Software Medical Billing Software Coding & Documentation 1 — Questions and Answers
Question 1: What coding system is primarily used in the United States to report medical diagnoses on insurance claims?
- CPT
- ICD-10-CM (Correct answer)
- HCPCS Level II
- DRG
Correct answer: ICD-10-CM
ICD-10-CM (International Classification of Diseases, 10th Revision, Clinical Modification) is the standardized coding system used to report diagnoses on US insurance claims.
Question 2: Which coding system is used to report outpatient medical procedures and evaluation and management services in the US?
- ICD-10-PCS
- HCPCS Level I (CPT) (Correct answer)
- DRG codes
- ICD-10-CM
Correct answer: HCPCS Level I (CPT)
HCPCS Level I, known as CPT (Current Procedural Terminology), is published by the AMA and used to report procedures and services rendered in outpatient and physician settings.
Question 3: What is the purpose of HCPCS Level II codes in medical billing?
- To replace CPT codes for hospital inpatient procedures
- To report products, supplies, equipment, and services not covered by CPT codes, including ambulance services and DME (Correct answer)
- To identify the physician's specialty for reimbursement purposes
- To document secondary diagnoses on a claim
Correct answer: To report products, supplies, equipment, and services not covered by CPT codes, including ambulance services and DME
HCPCS Level II codes are alphanumeric codes used to report items and services not included in CPT, such as durable medical equipment, orthotics, prosthetics, and drugs.
Question 4: In ICD-10-CM coding, what does the term 'principal diagnosis' refer to in an inpatient setting?
- The most common diagnosis for a given patient population
- The condition determined after study to be chiefly responsible for the admission (Correct answer)
- The first diagnosis listed by the provider in the chart
- The chronic condition that required the most resources
Correct answer: The condition determined after study to be chiefly responsible for the admission
The principal diagnosis is the condition established after study to be chiefly responsible for the patient's inpatient admission, as defined by the UHDDS guidelines.
Question 5: What does 'upcoding' mean in the context of medical billing compliance?
- Assigning a code for a more complex or higher-reimbursing service than was actually documented or performed (Correct answer)
- Submitting claims electronically rather than on paper
- Updating outdated ICD-9 codes to ICD-10 equivalents
- Using modifiers to increase payment for bilateral procedures
Correct answer: Assigning a code for a more complex or higher-reimbursing service than was actually documented or performed
Upcoding is fraudulent billing that assigns a higher-level or more expensive code than is supported by clinical documentation, resulting in inflated reimbursement.
Question 6: Which of the following best describes 'medical necessity' as it applies to coding and billing?
- Any service ordered by a licensed physician
- Services that are reasonable and necessary for the diagnosis or treatment of illness or injury as defined by the payer (Correct answer)
- Procedures performed in an emergency setting only
- Services covered under the patient's specific insurance plan
Correct answer: Services that are reasonable and necessary for the diagnosis or treatment of illness or injury as defined by the payer
Medical necessity requires that services be reasonable, necessary, and appropriate for the patient's condition, and it is a primary criterion payers use to approve or deny claims.
Medical Billing Software Medical Billing Software Coding & Documentation 1
What coding system is primarily used in the United States to report medical diagnoses on insurance claims?