In EHR Software, Medical Data Entry

The Effect Improper Coding Can Have On Your Medical Practice

Medical coding is a crucial part of every practice. After all, without it, insurance companies would be unable to reimburse, reduce or approve claims.

However, when these codes are misentered or miscoded, it can cause serious implications for your practice and its patients.

Below, we dig a little deeper into the world of medical coding to discuss:

  • The importance of accurate medical coding
  • The complexity involved in proper medical coding and coding education
  • The potential implications of miscoding
  • The benefits of outsourcing your medical coding

Let’s begin!

The Importance of Accurate Medical Coding

Accurate medical coding is key to receiving reimbursement from an insurance company, as well as maintaining proper patient documentation. If a code is incorrect, the insurance company may choose to deny a claim that otherwise would have been approved. The denial of an insurance claim (in regards to improper coding) is usually a result of two common types of improper coding: under coding and over coding.

Under-coding occurs when your practice isn’t reimbursed as much as it should have been due to miscoding. When something is under-coded, your practice actually loses money.

Over-coding, on the other hand, asks the insurance company to pay more than what is actually needed. This miscoding could be considered fraud on the part of your practice, which may lead to serious legal or financial penalties.

This is why accurate medical coding is so important. When coding is incorrect, your practice and its patients suffer. While miscoding can seriously impact your practice’s finances, it also directly impacts patient documentation.

For example, if a patient is suffering from a knee injury and needs to be referred to a specialist, it’s important that the right codes are entered so the specialist can properly identify and treat the correct knee. A slight slip-up in coding may indicate the injured knee is on the left leg, rather than the right, resulting in incorrect patient care. Mistakes like this are easy to make, however, they can result in hefty consequences for your practice and the patient experience.

The Complexity of Medical Coding Training and Education

Unfortunately, slip-ups in coding are somewhat common due to a lack of proper training and education. Many practices simply don’t have the time to remain educated on coding changes, causing unintentional miscoding.

Diagnosis Related Groups (DRGs) are typically the most difficult to code. DRGs consist of patient diagnoses, procedures, complications, symptoms, age, gender and pre-existing conditions. All of these are necessary to properly identify a patient, which is why whoever is in charge of insurance claims at your practice needs to know how to code correctly.

Coding is normally changed once a year, which means your practice needs to stay aware of the changes and effectively communicate them to your staff. If staff are unaware of changes in coding, your practice will be more likely to experience the negative effects of miscoding.

How Improper Coding Can Harm Your Practice

There are quite a few ways that the failure to provide correct coding can harm your practice. Here are some of the most notable consequences of miscoding:

A Delay In or Denial of Reimbursement

As we mentioned earlier, under and over coding can result in being reimbursed too much or too little—or not at all. When coding is incorrect, it’s unlikely that your practice will be reimbursed for the amount it needs. This financial impact can cause stress on your practice, and result in lost time due to the need to correct and resubmit the corrected codes.  

Lengthy Processing

It takes enough time to submit the claim as is. However, when you have to locate your mistake, correct and resubmit a claim due to miscoding, your practice is losing time that it can’t afford to give. This process can take a while, which in turn can prolong reimbursement even further.

Charges of Fraud or Abuse

If your insurance provider suspects fraud or abuse due to over coding, your practice may be fined. These fines can be quite expensive, yet so easy to avoid with proper coding. Working your way through or out of these fines can take time, not to mention the burden these inevitable costs will place on your practice.  

Insurance Carrier Audits

Additionally, if your insurance carrier senses fraud or abuse, they may decide to audit your practice. They will take an in-depth look at your coding process, and could determine that your practice owes money.

When coding is correct, an action like this can be easily avoided—especially if you outsource your medical coding to an experienced company.

How To Improve Medical Coding Through Outsourcing

Outsourcing your medical coding can help save time in the office, as well as reduce the risk of consequences due to miscoding. The investment in a coding service is one worth making—especially when you partner with the team at DataMatrix Medical.

DataMatrix Medical’s Medical Coding Service

Here at DataMatrix Medical, we know that coding requires an extensive amount of time and work. Any error, no matter how big or small, can cause serious implications for your practice.

When medical coding is correct, your practice benefits from fewer mistakes, improved patient care, and a quicker billing cycle (we can help with patient billing, too).

If your practice needs a streamlined coding audit and coding service you can rely on, we can help. Our team can review surgical claims and audit it against sourced documents to provide a review of any lost revenue caused by improper coding.

Here’s how we do it here at DataMatrix Medical:

  1. You submit documentation either through dictation, operative reports and/or handwritten charge tickets.
  2. We review the charges and code for error and then supply them in a standard format based on your requirements, right within your EHR.

Our process is simple and can help ease the pressure surrounding miscoding. To learn more about our coding solutions, contact us. We’ll be happy to answer any questions you have! Let us show you the value our services can bring to your practice.

Outsourcing can help improve productivity in your practice in more ways than one! Click the button below to download our free guide, How to Optimize Clinical Productivity Through Outsourcing.

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