Healthcare demand is on the rise. In 2023, National Health Expenditures (NHE) grew by 7.5%, outpacing GDP growth. Over the next decade, NHE is expected to grow at an average annual rate of 5.6%, faster than GDP growth (4.3%).
This might sound like good news; more demand means more services, right?
But here’s the catch: while demand for healthcare services is increasing, practices struggle to secure reimbursements. A 2024 report by Experian highlights this issue, revealing that 7 out of 10 providers complain about slower reimbursement, and nearly three-quarters experience more frequent claim denials.
How do we overcome these hurdles?
The answer is simple: Improve your clean claim rate. Fewer errors mean faster approvals and more revenue. It’s about ensuring you capture every charge and nothing slips through the cracks.
But here’s the problem. Relying on manual processes just doesn’t cut it anymore. Billing is too complex, regulations keep changing, and staffing shortages make it even harder to keep up.
The solution? Automated Coding. It’s like having a supercharged assistant that catches coding errors, ensures compliance, and speeds up claim submission, helping you get paid faster.
Want to know how automated coding can make a real difference? Let’s dive in.
Since the pandemic, claim denials have been on an upward trend, and errors in claim submissions are also increasing. These bottlenecks delay reimbursements, disrupt practice operations, restrict growth, and leave many struggling to stay financially sustainable.
And what's surprising? Despite these challenges, only 31% of providers leverage automation and artificial intelligence (AI) technology to process claims.
The good news? 45% of healthcare providers recognize the need for change and plan to move away from outdated manual processes by investing in claims management technology.
Beyond process improvement, automated medical coding technology is a vital asset that prevents claim denials, enhances accuracy, and boosts practice revenue. Let’s explore how automated coding works and why it’s a must-have for today’s practices.
Human errors are inevitable, and often, these errors are one of the leading reasons for denials, with 38% of providers agreeing that 1 in 10 claims are denied because of missing or incorrect data.
Another common problem is the lack of prior authorizations. Manual claim scrubbing can easily overlook errors when the workload is overwhelming, leading to denials or delayed payments. These mistakes often slip through the cracks, increasing the days in accounts receivable.
In contrast, auto-coding is devoid of fatigue and work pressure. It performs consistently, even under heavy workloads, without compromising accuracy and precision. Automated coding systems efficiently:
Staffing shortages are a growing concern in the healthcare industry. The National Center for Health Workforce Analysis (NCHWA) projects that by 2030, the overall demand for healthcare services will rise by 10%. Moreover, as baby boomers reach age 65, long-term care needs are expected to increase by 35%. However, the number of healthcare providers is expected to decline by 5%, which can negatively impact practice operations and care delivery.
The healthcare staff shortage is a growing reality, and practices that rely solely on the workforce will face increasing challenges in the future. Automating clinical coding helps mitigate the effects of the workforce shortage. These systems automatically assign codes based on clinical notes and patient records, minimizing staff workload and allowing providers to focus more on patient care.
Coding errors are a critical issue during claim submission, often leading to denials, audits, or lost revenue. Whether it’s undercoding (leaving out billable services) or overcoding (billing for unnecessary or excessive services), manual processes are highly susceptible to human error.
Automated coding systems seamlessly integrate with Electronic Health Records (EHRs) to simplify the coding process. They can quickly review patient medical records, analyze clinical notes, and suggest the most accurate codes for billing. Moreover, with the enhanced capabilities of AI, machine learning, and Natural Language Processing (NLP), these systems take accuracy to the next level. They analyze previously denied claims, identify the reasons for denials, and prevent future mistakes by applying accurate coding practices.
One of the standout advantages of automated coding is its ability to provide real-time feedback during the coding process. Unlike manual coding, where errors often go unnoticed until after submission, automated systems flag issues instantly and suggest quick fixes.
For example, suppose you submit a claim with CPT code 99215 (comprehensive office visit) for a routine follow-up, but the documentation only supports a moderate-level visit. The system will flag this discrepancy and suggest the code 99213 to prevent upcoding and avoid potential payer audits.
Much like a human proofreader catching typos in a document, auto-coding systems check for discrepancies, inconsistencies, and errors in the coding process. They review every element of the claim to ensure it justifies the documentation and flag any inconsistency or missing information that could lead to denials.
Here’s how automated medical coding systems help with proofreading:
The world of healthcare regulations is a moving target. Frequent updates — new codes, retired codes, and shifting rules — mean there’s always something new to learn. Moreover, variations across payers add yet another challenge for practices to juggle.
Healthcare professionals are already stretched thin by staff shortages and demanding workloads, and staying on top of these changes can feel impossible. Here, too, automated clinical coding comes to your rescue.
Automated systems rely on the most up-to-date ICD-10, CPT, and HCPCS code sets, sparing you the guesswork of matching procedures, diagnoses, and services to the correct codes. While streamlining the clinical coding process, these tools also ensure every claim meets the latest regulatory requirements.
Timely submission is vital for optimal revenue capture. Submitting claims before the deadline ensures full reimbursement, which maintains a steady cash flow to cover expenses like payroll, supplies, and patient services. Missing claim submission windows, which often vary across payers, result in denied claims or reduced payouts. For practices already working with tight budgets, even minor delays can disrupt operations and impact the quality of patient care.
Automating your coding process makes a real difference. These automated systems cut turnaround time by days, not hours or minutes. It speeds up every step of claim submission — extracting data, applying accurate codes, proofreading for errors, and submitting claims — working efficiently to ensure claims are submitted well before deadlines, reducing the risk of denials or delays.
Automation keeps your finances on track and makes life easier for everyone involved. Optimizing billing time frees your team to focus less on paperwork and more on patient care.
Growth is exciting, but let’s be honest, it’s not without its challenges. As your practice expands, patient volume increases, and so do billing complexities. Manual coding processes often can’t keep up, leading to bottlenecks, delayed reimbursements, and increased stress.
Automated coding helps you effortlessly scale your operations to meet the demands of a growing practice. Whether your practice doubles in size or faces new demands, these systems scale with you, ensuring smooth operations.
Medical practices are constantly struggling with clinical coding complexities, workforce shortages, claim denials, and an ever-growing list of administrative burdens. All these challenges indirectly impact care delivery. Automation helps you streamline revenue cycle management, stay competitive, and thrive in this dynamic world.
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