Saturday, December 8, 2012

How Under-Coding Affects the Financial Well-Being of Your Medical Practice


Most physicians are concerned with using the proper coding parameters when submitting claims to insurance providers, and with good reason. It is not uncommon, however, for a physician to be unfamiliar with the proper coding techniques and guidelines for office visits. Due to this lack of understanding, these physicians can only guess which code should be used, rather than using the code that is actually meant for the treatment provided.

In some cases, the above approach does work. In most instances, however, improper coding creates serious issues with a practice's records and documentation. By taking a "hit or miss" approach to coding and billing procedures, these physicians are losing money that they are rightfully entitled to.

When it comes to billing, your practice has three options. You can either up-code, down-code or under-code to varying degrees. The term "under-coding" refers to a reduction of coding for a variety of reasons. For purposes of this article, we will address office visit codes known as Evaluation and Management codes and how you can ensure that you are using them properly.

Throwing Money Away

Some doctors bill all of their office visits at a lower level code, such as 99212. These doctors hope that by doing this, they will be able to alleviate billing complications. Unfortunately, this approach to billing does more harm than good to the financial well-being of your practice. First and foremost, when you generalize your coding like this you are losing out on a lot of revenue - usually to the tune of about $100,000 each year. However, this is not the only problem that this billing technique presents. If you use a single, lower-level code for all of your office billing, you are going to run into problems if you face an audit. In fact, under-coding can actually lead to an audit due to the overuse of the code you are using for your office visits.

Documenting Medical Necessity

Properly documenting your patients' office visits is paramount to proper billing. The criteria for being paid for an office visit is Medical Necessity. If you have documented the Medical Necessity of the services you provide, you should have no problem being paid for the visit. If you are meeting the proper criterion for higher billing codes and you did the work, you have every right to be paid for it. For example, if you treated a problem and have the criterion present to bill for 99214, why would you bill for 99212?

Avoiding What You Don't Understand

Many doctors avoid coding properly due to a lack of understanding. If you want to ensure that you generate as much revenue as possible for your practice, you need to code correctly. For example, if you are treating a diabetic that is controlled, you should use 250.00. However, if you are treating an uncontrolled diabetic, you should use code 250.xx or one of the other codes with a fifth digit. The more accurate you are in your coding, the more revenue you will be able to generate for your practice.

While under-coding may seem simpler in the short-term, in the long term it will result in being paid less for what you do. As more practices face cutbacks and reimbursement reductions, it is crucial to maximize your revenue whenever possible. You owe it to yourself and your practice to capture as much revenue as possible. This means taking the time to learn the proper coding techniques that will put as much money into your practice as possible.

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