3 Major Consequences of Inadequate Coding

Whether you choose to maintain a skilled, expert coding department, or partner with a highly qualified third-party team, accurate, precise coding is paramount to your practice’s success. Without exact codes accompanying every patient encounter, revenue may be lost, rework on denied claims may be escalated, and the patient’s care may be affected.

A major challenge for any practice is choosing the most impactful way to manage their ICD-10-CM, CPT, and HCPCS coding needs. With major changes being instituted every year and quarterly changes being propagated by the Centers for Medicare and Medicaid Services (CMS), not to mention unusual circumstances such as COVID-19, staying up-to-date is a full-time job.

3 Preventable Problems Brought by Inadequate Coding Practices

These issues take its toll on your overall practice outcomes, with patient care impacted and/or revenue at risk. Let’s look at each in turn:

1. Impacting Patient Care through Neglectful Coding Errors

Every practice strives to provide quality patient care as a cornerstone of their existence. However, inaccurate medical coding can set off a series of events that negatively colors the relationship built with valued patients.

Aside from impacting the reimbursement, and potentially the patient’s portion due, inaccurate coding can also directly harm the patient’s treatment.

Consider what happens when referring a patient or getting insurance authorization when using an incorrect diagnosis code. There are slight variances in codes that denote specificity for each medical diagnosis. Using inaccurate codes during diagnosis, the testing, treatment, and care rendered at a referral source or other healthcare facility may be inappropriate or not extensive enough for the issue being treated.

As one example, missing 2-digit modifiers on hip injuries have resulted in expensive MRI studies being conducted on the wrong joints. Healthcare is costly enough without unnecessary or inappropriate care being rendered that must be repeated or duplicated.

2. Coding Errors or Omissions Significantly Impact Reimbursement

While providers get into the healthcare field to render care and improve lives, without fair and appropriate reimbursement, the wheels grind to a halt.

In the complicated world of third-party insurance payers, coding is the mechanism that informs the payer of the specific treatment being rendered, including the diagnostic testing, rehabilitative services, and chargeable supplies that are used. When you submit a request for reimbursement, the ICD-10 and CPT codes tell the insurer what was done and why.

When claims are submitted with missing or inaccurate codes, it sets off a series of events where insurance payers end up paying too little or too much or denying the claims outright. Correcting these mistakes is costly and time-consuming for the practice, and according to the Medical Group Management Association (MGMA), 65% of denials are never followed up or corrected, and the revenue is simply abandoned.

3. Repeated Mistakes or Intentional Miscoding Can Lead to Fraud and Abuse Claims

Whether intentional or careless, repeated submissions of claims with coding errors or inappropriate codes, such as upcoding, downcoding, or inaccurate bundling, can lead to fines or federal penalties for fraud or abuse.

The enforcement tool used for false claims is the False Claims Act (FCA), and the consequences can include a monetary penalty or legal ramifications if the claim is deemed fraudulent. To prove fraud occurred rather than abuse, the upcoding or miscoding has to be proven that it occurred many times, across a large number of patients.

As part of our “Health Check”, Enhanced Revenue Solutions (ERS) by Infinx is available to provide an audit of your current coding and billing processes and recommend changes that will benefit your bottom-line.

Consider a Third-Party Coding Partner

Medical coding is a critical component of the reimbursement process and is the lifeblood of any practice. If you aren’t satisfied with your bottom-line results or feel like your coding could use a makeover, consider the benefits of engaging a third-party partner who would be responsible for precise, accurate, and timely coding, but also staying up-to-date and current on coding guidelines.

If you are ready to improve your bottom-line, contact ERS by Infinx and request a free coding audit.