September 18, 2023

The Most Common Medical Coding & Billing Errors

As you dedicate yourself to providing exceptional medical care, it's only fair that your efforts meet with rightful compensation. Nevertheless, it's essential to avoid billing errors that could lead to unforeseen complications.

Billing errors drain a whopping $125 billion annually in the United States alone!

This significant financial strain isn't just a number — it's a widespread problem affecting the whole healthcare system, from medical practitioners like you to the patients you serve.

Billing mistakes aren't just about dollars and cents; they can potentially erode the trust between physicians and their patients. It's an issue that goes beyond the balance sheet, potentially tarnishing the credibility of healthcare practices.

Against this backdrop, it's high time we delve deeper into the nuances of medical billing, aiming to preempt any errors that might crop up in medical billing and coding.

Medical Coding & Billing Errors that Drain Your Revenue

Amidst the shifting landscape brought on by the pandemic, a remarkable 70% of those surveyed by Experian underscore the amplified importance of claims management. Notably, 43% of these respondents attribute this surge to increased errors encountered during claim submissions — an undeniable sign of the evolving challenges in the healthcare industry.

Let's look at some common errors to steer clear of when submitting claims.

1. Unbundling codes

Unbundling involves submitting multiple codes for the different parts of a procedure that should be billed under a single code. This can artificially inflate the reimbursement amount and is generally not allowed.

For example, consider a scenario where a physician orders a comprehensive blood test for a patient. The practice should use a single billing code to encompass all the blood tests performed.

Unbundling arises if the practice bills each specific test separately using different codes, even though they are to be covered by a comprehensive bundled code. 

2. Overcoding/Undercoding

Overcoding and undercoding errors are common pitfalls in medical billing.

Overcoding occurs when a healthcare provider submits a code suggesting a more severe illness or procedure than was genuinely carried out. This can lead to increased reimbursement, but if done deliberately, it constitutes fraudulent activity.

Conversely, undercoding occurs when a provider employs a code that doesn't aptly capture the intricacy or intensity of the services rendered, resulting in lower reimbursements.

While differing in direction, both overcoding and undercoding can result in financial discrepancies, tarnish the trust between providers and patients, and potentially lead to regulatory repercussions.

3. Inaccurate Coding

Errors in choosing the correct Current Procedural Terminology (CPT) or Healthcare Common Procedure Coding System (HCPCS) codes can result in inaccurate billing. 

Given the extensive collection of ICD-10 codes numbering over 78,000 and the frequent incorporation of new codes by CMS, it has become increasingly imperative for both seasoned and novice coders to undergo ongoing training to maintain their current proficiency.

4. Neglecting NCCI Edits for Multiple Codes

The Centers for Medicare & Medicaid Services (CMS) developed the National Correct Coding Initiative (NCCI) to ensure accurate coding and prevent incorrect payments within Medicare Part B claims.

NCCI edits are sets of rules that identify code pairs or groups that typically should not be billed together for the same patient on the same day by the same provider. When an NCCI edit is identified, the system declines one of the codes. Additionally, NCCI rules may indicate codes that can be added to resolve the issue.

Scrutinizing NCCI edits when presenting multiple codes in a claim is pivotal. Familiarity with assessing a high-risk patient treated by the same provider on a particular day can proactively deter denials and ensure accurate compensation for Medicare Part B claims.

5. Duplicate Billing

Duplicate billing occurs when the same medical service or procedure is billed more than once for a single patient during the same visit or treatment period. Such errors can lead to overpayment by insurance companies and also confuse patients. 

Duplicate billing might stem from various reasons, such as administrative oversights or technical glitches in the billing system. To prevent this, healthcare organizations should implement robust billing procedures that include thorough checks and balances. Regular audits of billing records can help identify and rectify any instances of duplicate billing before they lead to financial discrepancies or patient dissatisfaction.

6. Inappropriate Modifier Application with Inadequate Documentation

The American Medical Association (AMA) has flagged an issue of frequent misuse of modifier 22, which denotes a more complex procedure, often due to insufficient supporting documentation. Similarly, insurance carriers have highlighted errors in modifiers 25, 50, and 59, indicating instances where they are employed inappropriately.

Providing thorough documentation explaining the reasons behind a procedure's heightened complexity is crucial. For example, consider the situation where a lesion removal on an obese patient becomes more challenging due to their weight. Adding modifier 22 can accurately communicate the increased difficulty.

Inadequate or unclear documentation can lead to miscoding and the potential rejection or denial of claims. By furnishing detailed health information and collaborating with coders through queries for clarification, healthcare providers can precisely bill the process.

7. Improper Code Usage

Accurate documentation of medical services' precise start and end times is pivotal for coders to ensure proper billing procedures. However, complications arise when services span two consecutive days, demanding distinct coding strategies.

For instance, consider the scenario of continuous intravenous hydration administered from 11 p.m. to 2 a.m. Instead of using a single code for continuous infusion, coders should differentiate between the initial (96374) and sequential (96376) administrations.

Furthermore, a key principle in proper coding is to report only a single code for an entire session during which injections occur. Abstain from reporting multiple units of the same code, which can lead to erroneous billing practices.

8. Using Unlisted Codes without Proper Documentation

Billing unlisted codes without proper documentation poses a significant coding challenge.

When there's a necessity to employ an unlisted code to bill for a service accurately, meticulous documentation becomes imperative. Unlisted codes are typically used when no specific existing code precisely represents the provided service.

However, using these codes without comprehensive documentation explaining the nature of the service, its complexity, and the reasons for using the unlisted code can lead to billing disputes, claim denials, and compliance issues. In such instances, healthcare providers should ensure that each unlisted code billed is accompanied by detailed documentation that elucidates the unique aspects of the service, reinforcing the necessity of the code's application.

Mitigate Billing Errors and Boost Revenue

The ultimate goal of submitting any claim is to receive proper payment. The most effective approach to achieve this is submitting accurate claims from the outset. At Glenwood, we leverage advanced tools to manage claim denials and oversee accounts receivable (A/R). Our specialized software, GlaceRCM, learns from past denial cases, equipping our team with invaluable knowledge to achieve successful resolutions and ultimately boost your revenue. Moreover, we diligently track each claim's progress until it's fully resolved without prematurely removing them from A/R based on a predefined time frame.

GlaceRCM/EMR - Billing Service For Private Practice

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