Six Common Medical Coding Mistakes That Impact Revenue - Omega Healthcare

Six Common Medical Coding Mistakes That Impact Revenue

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Breaking Down the Medical Coding Dilemma: 6 Common Medical Coding Mistakes to Avoid

One of the most significant contributors to rising healthcare costs is administrative waste, which is estimated to account for between 15 to 30 percent of all healthcare spending. Inefficient, time-consuming manual processes are at the heart of the problem.[1] This is especially true in the area of medical coding. Issues with coding can lead to coding backlogs or even claim rejections—both of which cause additional work for already overworked staff— as well as poor cash flow, lingering days in A/R, and increased write-offs. It all takes a toll on revenue integrity. Just like each patient’s diagnosis and treatment, each medical record calls for personalized and thorough coding. 

The pressure to produce accurate coding is high, considering the consequences of a mistake or oversight–rejected or denied claims, underpayment, penalties, fines, and even takebacks. Healthcare providers and revenue cycle managers who know what to watch for are less likely to experience coding issues that can negatively impact their revenue.[2] Safeguarding your organization against these six common coding problems enables everyone involved to successfully submit error free claims and gain accurate reimbursement. 

Six Common Coding Mistakes That Impact Revenue

  1. Not coding to the highest level of specificity. This requires a solid knowledge of procedural and diagnostic coding, abstracting of medical data elements, and capturing the most information from the documentation for thorough coding. If the details are not captured at the highest level of specificity, the patient’s care may not be effectively managed. It’s also possible the provider won’t receive compensation that aligns with the appropriate level of care for high-risk patients.[3] 
  2. Poor quality or missing documentation. Unclear and incomplete documentation from providers can cause miscoding and rejected or denied claims. Providers can help paint a comprehensive picture of the service they provided by documenting detailed health information and by collaborating with a coder who reaches out for clarification also known as a query.[4]
  3. Undercoding. Including codes for each procedure and service rendered is essential to managing a patient’s treatment history and to optimizing revenue. Undercoding can lead to lost revenue and a misrepresentation of provider claims data.[5]
  4. Not using updated code sets. Experienced and novice coders need continuing education to stay current navigating through the more than 78,000 ICD-10 codes as well as a multitude of new codes that get added annually by the CMS (Centers for Medicare & Medicaid Services).[6] Relying on certified coders and developing their awareness of coding’s impact on cash flow is crucial
  5. Overusing and incorrectly using modifiers. Coders must ensure the correct documentation rationalizing a procedure in addition to the correct use of modifiers. The AMA (American Medical Association) finds modifier 22 is highly overused due to a lack of documentation around why a procedure was more complex than usual.[7] In addition, carriers have identified modifiers 25 and 59 as being incorrectly used.[8]
  6. Not checking NCCI edits. The AMA also advises checking the NCCI edits when reporting multiple codes in a claim. CMS implemented the edits to ensure appropriate payment for Medicare Part B claims and to direct coders to follow the correct billing processes. Knowledge of the claim analysis process for a certain high-risk patient who received service on a particular date by the same provider can offset the chance of a denial.[9]


$25 is the average cost to rework and resubmit a single claim. For providers, this typically adds up to thousands in additional monthly expenses. [10]

The “Coding D-List”

The following key competencies help providers and medical coding professionals to offset medical coding mistakes, oversights, and omissions and position them to better control administrative time and costs. 

  • Deliver care-specific details
  • Documentation providing clear information 
  • Details for identifying all applicable codes 
  • Dedication to referencing updated and current code sets
  • Diligent use of modifiers 
  • Double-checking NCCI edits 

Producing accurate and complete medical coding will continue to prove challenging for providers due to staffing issues and ever-changing code sets and payer rules. Auditing for shortcomings before a claim submission reduces the possibility of rejected or denied claims, underpayment, penalties, fines, and takebacks. 

Providers seeking to expand their coding capabilities and improve compliance and accuracy should explore partnering with a Health Information Management (HIM) coding industry expert. Leveraging a technology-enabled outsourcing partner can help your organization build efficient and effective medical coding processes and relieve staffing burdens. 

When choosing a coding partner, providers should first look for one that can demonstrate a high level of accuracy. The most effective and accurate vendors will be those that use the latest technology, especially artificial intelligence (AI) for predictive coding and natural language processing (NLP), as well as a robust workflow tool that monitors and optimizes work inventory at all stages. These technologies improve productivity and deliver more accurate coding by proactively identifying and flagging potential coding issues so they can be addressed before the claim has a chance to be rejected or denied.

When talking to a potential partner, providers should ask how many coders they have, how their coders are trained, and how many charts they code each year. They should also ask what percentage of claims the vendor audits. Finally, providers should ensure the vendor has expertise in their specialty. 

Omega Healthcare can help. 

Omega Healthcare is a leading provider of technology-enabled HIM coding services, enabled by ODP-CODE, partnering with clients to help them reduce overhead-associated costs, mitigate risk and liability, and act as advocates on their behalf. 

Omega Healthcare empowers healthcare organizations to improve financial outcomes through our Omega Digital Platform and clinically enabled transformational solutions, providing:

  • Expertise from 118+ million charts coded
  • Over 7,000 knowledgeable HIM coders 
  • Coders experienced in facility, pro fee and risk adjusted coding 
  • Industry training conducted to educate coding employees, clients, and coders at-large

Learn more about how Omega Healthcare can help organizations address these top coding challenges. 

[1] “How Administrative Spending Contributes to Excess US Health Spending,” Laura Tollen, Elizabeth Keating, Alan Weil, Health Affairs, February 20, 2020

[2] “Bad Documentation/Missing Documentation,” Medical Billing & Coding, accessed via web January 23, 2023 

[3] Ibid.

[4] Ibid.

[5] “Undercoding in Healthcare: How to Identify & Prevent Missed Revenue,” Elizabeth Kelly, YES HIM Consulting, January 17, 2023

[6] “Changes to ICD-10-PCS Codes: CMS Updates Effective October 2022,” Mikki Fazzio, Health Catalyst, July 20, 2022

[7]  “8 medical coding mistakes that could cost you,” Kevin B. O’Reilly, AMA, July 14, 2021 

[8] “Claims and Payment Policy: Prepay Code & Modifier Validation,” Wellcare, January 1, 2020.

[9] “8 medical coding mistakes that could cost you,” Kevin B. O’Reilly, AMA, July 14, 2021 

[10] “You might be losing thousands of dollars per month in ‘unclean’ claims,” Tina Graham, MGMA, accessed via web Feb. 9, 2023.

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