The Importance of Medical Coding Accuracy and How to Achieve It

5 Benefits of Accuracy in Coding for Your Health Center

1. Ensures Accurate Reimbursements

Coding is the foundation for your doctors and healthcare center to get paid. Proper coding gives a clear picture of the services and procedures performed, allowing accurate, timely reimbursements once the claims get processed.

Since each procedure and diagnosis has a specific code, any discrepancies between the service provided and the code submitted can result in underpayments—impacting your practice’s financial health and bottom line. This directly affects how and when your service providers get reimbursed.

Accurate coding improves the chances of getting reimbursed the first time a claim is submitted, reducing the need for follow-up actions, appeals, or extra admin work. Thus, besides ensuring complete reimbursements, it also accelerates the payment cycle, preventing any form of financial shortfall.

2. Minimizes Claim Denials

Do you find many of your claims getting denied? It may be helpful to review your coding practices. Coding errors are considered the top cause for claim denials— around 24% of claims are denied due solely to coding errors.

But beyond just causing a denial, coding errors also create systemic issues within the billing cycle. For example, incorrect coding can get you stuck in frequent back-and-forth communication cycles with insurance companies, lengthening overall claim processing time.

Proper coding minimizes these issues from the get-go, ensuring that the first submission is error-free in itself. It ensures that your claims contain accurate information and appropriate codes—keeping them from bouncing back from the insurers. This saves you from draining your resources in refiling and resubmitting denied claims.

3. Optimizes Revenue Cycle Management

Your coding efficiency directly impacts your revenue cycle management. From initial patient registration to final payment reconciliation, accurate coding ensures that your billing process flows smoothly at every stage.

While accurate coding can maximize your first-pass acceptance rates, speed claims processing, and streamline reimbursements, errors in coding can obstruct payments, cause delays, and impact the overall revenue cycle.

Ensuring accuracy in coding also helps you minimize your days in AR and increase your medical center’s financial stability, serving as the backbone of your revenue cycle management process.

4. Establish Trust with Insurers

Inaccurate or fraudulent coding can have lasting consequences on your practice. Take, for example, a simple Evaluation and Management service coding, which helps categorize the level of service provided. If a doctor performs a quick evaluation as E/M Level 1, but the service is coded as E/M Level 5—it might put you under scrutiny when the insurer catches the deviation.

Such instances of overbilling and errors in coding lead to denials, trigger penalties in the long run, and even erode your relationship with insurers. This makes ensuring accuracy in coding a crucial element in establishing and maintaining a level of trust with insurers and streamlining upcoming reimbursements.

When your coding practices consistently align with insurance guidelines, it demonstrates reliability and transparency in your billing processes. Over time, you are more likely to develop a cooperative relationship with insurers, leading to fewer payment disputes, faster approvals, and a smoother reimbursement experience.

5. Helps Ensure Regulatory Compliance

Healthcare has strict coding standards and regulations, and ensuring your center adheres to them is crucial for a healthy performance. Non-compliance can lead to severe legal consequences, hefty penalties, and damaged industry reputation.

Maintaining accuracy in coding helps you adhere to the latest guidelines set forth by CMS (Centers for Medicare & Medicaid Services) and the AMA (American Medical Association), and ensure complete compliance.

Key Strategies to Ensure Coding Accuracy and Compliance

Today, modern Practice Management Software (PMS) systems have automated many billing and coding functions. However, the recorded medical coding still requires a sharp expert eye for review before submission.

Even with the automated PMS, there’s a possibility for incomplete documentation, unreported services, or even inaccurate coding inputs – this is where a manual coding input offers much-needed support.

Manual audits and checks via coding experts can help identify coding inaccuracies, clarify modifiers, and address any issues to avoid potential denials. For this, it’s important to have in-depth knowledge and awareness of the latest coding guidelines, regulations, and best practices.

Hiring AAPC-certified coders in your center ensures that you have a coding team that understands the nuances of coding—including the order of codes, proper sequencing, application of modifiers, and more.

Here are 5 ways in which you can ensure accurate coding in your healthcare center:

• Keep your coding staff up-to-date: Conduct regular training sessions on new coding updates, such as changes in ICD and CPT codes.

• Maintain complete documentation: Ensure that all procedures and diagnoses are documented accurately, leaving no room for incomplete documentation.

• Employ AAPC-certified coders: Ensure that your staff is well-versed in all coding nuances and the latest coding regulations.

• Regular audits and reviews: Conduct periodic audits of your coding practices to identify and correct any discrepancies or errors before claims are submitted.

• Improve physician-coder communication: Establish open lines of communication between doctors and coders to clarify any ambiguous documentation immediately.

Key Takeaway

The importance of accurate coding cannot be understated. It directly influences your reimbursements, revenue cycle, claim submissions, and even overall patient satisfaction. Which makes errors and oversight in coding a costly endeavor. It goes to show the importance of having a team of well-versed, experienced, and certified coding experts to support your PMS and ensure complete accuracy before claim submissions.

Several medical centers are now opting to outsource their medical billing to experts, helping them cut operating costs while increasing coding efficiency. Outsourcing to medical billing specialists is a proven way to achieve compliance, minimize denials, and streamline your revenue cycle. It’s an investment that brings you a solid return and enhanced value, with multiple benefits that optimize your practice’s financial health.

If you’re looking for medical billing experts to review your existing processes, find gaps, and suggest targeted changes, reach us at contact@listerventures.com We’ll take note of your requirements and conduct a free mini-audit aimed to streamline your billing process.