Quality coding is essential for a healthy revenue stream. Superior coding can reduce denials, improve cash flow, facilitate faster and more accurate reimbursement, and decrease “takebacks” and penalties. It is estimated that 42% of denials are caused by coding issues. With payers denying more claims than ever—more than one in ten in 2022—practices cannot afford to ignore coding issues.
Top coding issues
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According to the American Medical Association, there are eight primary coding issues that providers should be aware of.
- Upcoding. Coding for a higher level of evaluation-and-management (E&M) service than is warranted.
- Not referencing National Correct Coding Initiative (NCCI) edits for multiple code reporting. The NCCI involves automated prepayment edits that reference code pairs billed on the same day. Not checking for NCCI can lead to the denial of one of the codes.
- Incorrect appending of modifiers. Reporting modifiers for procedure codes that already include a specific service.
- Overuse of modifier 22. When reporting that a procedure is more difficult than normal, appropriate documentation must be included to support the use of the modifier.
- Inappropriate infusion, hydration, and injection codes. These services, especially when reported in tandem and/or across multiple days, must have proper documentation, particularly of start and stop times.
- Not including documentation for unlisted codes. Unlisted codes must be thoroughly documented.
- Unbundling. Using multiple CPT codes for each part of a procedure instead of the required “bundled” code that includes all procedures. (However, payers may have specific policies, for example paying for one E/M per day, that could be adjudicated as bundling, even though coding is correct. Therefore, correct coding won’t alleviate this sort of issue.
Medical coding is particularly challenging for specialty practices as there have been numerous revisions to existing codes and now requires increasingly complex clinical documentation. For example, specialties like cardiology experience ongoing contractual changes and amendments to their procedure rules. Cardiology coding includes complex combinations of codes, making them more time-consuming to manage and elevating the likelihood of errors. Besides cardiology, other specialties that include difficult coding include nephrology, ophthalmology, orthopedics, pediatrics, and radiology.
Coding-related measurements every practice should be tracking
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The most effective way to identify coding issues is by measuring and tracking key performance indicators (KPIs) in accordance with industry best practices. One of the most important is the clean-claims rate, which is the percentage of claims that are accepted on first submission. If any mandatory or conditional information is missing, the payer will reject or deny the claim.
The following are coding-related benchmarks every practice should strive to meet:
- Complete/timeliness of charge capture: 3 – 5 days after the date of service
- Average coding turnaround time: 0 – 5 days
- Initial denial rate: <5%
- Bad debt rate: <5%
- Reimbursement (DRG) accuracy: 95%+
- Coding accuracy: 95%+
Building a high-performing coding team
The most impactful step practices can take to elevate coding quality is to implement an ongoing, stringent training program. Coders should be required to achieve a coding accuracy level of 95%+ or above. Practices may want to offer incentives for reaching or exceeding this benchmark. A quality coding training program should also include certification from the AAPC or AHIMA. Once certification is completed, coders should be required to pursue continuing education credits to help them build their knowledge base and level of expertise and stay abreast of coding updates
Education should extend to physicians as well via a Clinical Documentation Integrity program. Physicians often don’t understand the impact of poor documentation on coding accuracy and, therefore, revenue. CDI training can help ensure physicians are more diligent when making notes or entering notes into the EMR, thereby reducing errors that lead to denials, payer audits, and takebacks. This decreases the need to pend encounters to the physicians for clarification, which can increase turnaround time and delay cash flow while awaiting a response.
Computer-assisted coding
While medical coding will always require a human touch, computer-assisted coding (CAC) can be a game-changer in terms of quality and production. CAC uses natural language processing (NLP) to interpret a physician’s notes, matching phrases, diagnoses, and procedures with the correct codes. This streamlines and improves the accuracy, completeness, and compliance of clinical documentation. The result is fewer denials and more timely reimbursement when implemented appropriately.
Audits and reviews
In addition to rigorous training and CAC, practices should consider implementing quality audits, including evaluation and management (E&M) reviews. The importance of internal audits cannot be overemphasized since the potential for penalties and “takebacks” is growing.
Because E&M codes are generally the most prolific code set in the practice, they represent considerable revenue impact. Government and commercial payers pay significant attention here. E&M reviews give practices a more comprehensive view of trends over a larger period of time, enabling coding issues to be proactively addressed.
The increasing popularity of outsourcing
Practices struggling with staffing shortages and cash flow issues may find it challenging to invest the resources necessary to implement training programs, CAC, audits, and reviews. That’s why many find it preferable to outsource portions or all of their coding needs. When choosing a partner, there are some important capabilities to look for, including the following:
- Comprehensive coder training program, including national certification
- An emphasis on clinical documentation improvement (CDI), including physician training
- Coders with broad payer expertise
- Investment in the latest automation technology
- Coding auditors with extensive experience
- Low coding staff turnover
- Coding accuracy rate of 95+% or higher
- Proven record of success in reducing denials, takebacks, and A/R days
The time to act is now
Practices are facing unprecedented revenue pressures right now. Taking a fresh look at their coding quality can help reduce denials, payer takebacks, and cash flow issues. Implementing intensive coding training, CAC technology, and internal audit and review programs can help. However, for practices that lack the resources to make such investments, outsourcing may be a better approach. It can take years for new coders to develop the level of expertise that outsourcers can provide. Because outsourcers typically have more experienced staff and more advanced technology, practices can achieve the highest levels of coding accuracy faster and with less effort.
Photo: sinemaslow, Getty Images
Kimberly McKenney has 19 years of experience in Revenue Cycle Management, covering both physician and hospital. In addition to Physician Coding and CDI Operations, she has held numerous RCM leadership positions overseeing Hospital and Physician Billing, Clinical Denials, Coding Quality, Emergency Department Coding, and Outpatient Facility Coding. Her experience includes multi-hospital organizations, which include critical access and academic health centers, as well as multi-specialty medical groups. Prior to joining Conifer Health Solutions, Kimberly spent almost 10 years working for Indiana University Health, focusing on their revenue cycle, a period which culminated as a Director in their Revenue Cycle Services division. She then spent nearly six years as a Director of Coding Operations and Coding Quality with Healthcare Administrative Partners.
