Clinical validation is both a concept and a process. It has implications for diagnostic documentation, coding, claims submission, payer review, audits and denials, recovery audit programs, regulatory compliance, and sanctions, and it sometimes raises concerns about false claims, with potential legal consequences.
Clinical validation means that diagnoses documented in a patient's record must be substantiated by clinical criteria generally accepted by the medical community. Generally accepted clinical criteria typically come from authoritative professional guidelines, consensus, or evidence-based sources.
In the absence of such sources, a less objective test of clinical validity may be the clinical diagnostic standards that most clinicians in a comparable specialty would reasonably agree are sufficient for establishing a particular diagnosis. To better understand the concept of clinical validation, let's take a look at some specific examples.
In its 2013 guideline, the American College of Gastroenterology said that the diagnosis of acute pancreatitis is most often established by the presence of 2 of 3 criteria: abdominal pain consistent with the disease, serum amylase and/or lipase level greater than 3 times the upper limit of normal, and characteristic findings from abdominal imaging. Clinical validation of acute pancreatitis would typically require at least 2 of these findings confirmed in the medical record unless the clinician documented a plausible alternative basis for the diagnosis that other clinicians would find reasonable.
The definition of acute respiratory failure is an example of a diagnosis without specific professional guidelines but with widely published and almost universally accepted criteria.
- Hypoxemia: room air PO2 <60 mm Hg, or PO2/FIO2 ratio <300, or a decrease in PO2 of 10 to 15 mm Hg from the baseline value
- Hypercapnia: PCO2 >50 mm Hg with any degree of acidosis (generally pH <7.35) or an increase in PCO2 of at least 10 to 15 mm Hg from the baseline value
Substantiation of 1 or more of these criteria in the medical record would be necessary to clinically validate a diagnosis of acute respiratory failure.
Payers and auditors apply clinical validation processes to professional and institutional claims to determine whether the diagnosis codes submitted are substantiated by widely accepted clinical criteria. An auditor, usually a nurse, reviews selected records for clinical validation of diagnoses. Most payers focus on just a few diagnoses where most clinical validation deficiencies affecting reimbursement are found, such as sepsis, acute respiratory failure, pancreatitis, severe malnutrition, and acute kidney injury. Unfavorable review findings may result in denied claims, reduced payment, expanded audits, sanctions, penalties, or even legal action, especially in cases of pervasive or systematic deficiencies.
Medicare requires that claims submitted for payment must not include codes for diagnoses that cannot be “clinically validated.” Prepayment reviews by any payer may result in denial of claims or reduced payment. Recovery audit contractors for both governmental and commercial payers frequently challenge claims based on the lack of clinical validation of coded conditions.
The False Claims Act of 1863 imposes severe penalties for the submission of claims to the U.S. government for goods or services not actually rendered. Today, the law is applied to health care claims, including cases where codes for conditions patients actually did not have (i.e., those unsubstantiated by accepted clinical criteria) are assigned by any clinician with actual knowledge (including deliberate ignorance or reckless disregard) that the claim was false, if doing so increases reimbursement or has a positive impact on quality measures affecting reimbursement.
Recently, a new twist has been added to the clinical validation conundrum. The 2017 ICD-10-CM Official Guidelines for Coding and Reporting (OCG), effective Oct. 1, 2016, contain a new, perplexing, and problematic section regarding clinical diagnostic criteria used for clinical validation. Section I.A.19 is titled “Code Assignment and Clinical Criteria,” and it creates a daunting dilemma, reading:The assignment of a diagnosis code is based on the provider's diagnostic statement that the condition exists. The provider's statement that the patient has a particular condition is sufficient. Code assignment is not based on clinical criteria used by the provider to establish the diagnosis.
The new OCG provision may have been intended to clarify that coders should not be responsible for making such clinical distinctions but appears to have the unintended consequence of putting providers (individual clinicians, groups, and institutions) and coders in a precarious position. The OCG doesn't just apply to coders but has legal and regulatory status for all clinicians engaged in health care transactions. If this provision is taken literally, clinicians may mistakenly assume that clinical validation is not necessary and may improperly assign codes on claims for unsubstantiated, clinically “invalid” diagnoses.
In spite of this OCG provision, clinical validation remains a contractual, regulatory, and statutory necessity. If clinicians do not consider the clinical validity of diagnoses for the codes submitted on claims, they will not be in compliance with CMS regulations and policy, will be potentially exposed to claims denials, may be subject to regulatory inquiry and sanctions, and in rare circumstances may be vulnerable to serious allegations of submitting false claims. Hospitals and clinicians must ensure that only codes for “clinically valid” diagnoses are submitted on their claims.
Coders should not be held accountable for clinical validation because they would not be expected to make such clinically complicated judgments by themselves, but they must be informed and involved. Clinicians need to be aware of the most current authoritative and widely recognized diagnostic standards and apply them to their diagnostic practices. If a clinician reasonably bases a diagnostic determination on something other than the widely recognized criteria, the rationale should be clearly stated in the record.
In summary, clinical validation means that diagnoses documented in a patient's record and coded for claims submission must be substantiated by generally accepted clinical criteria. Almost all payers perform selected reviews of clinicians' claims for clinical validation, and unfavorable findings may result in denied claims, reduced payment, or more serious consequences.