Common Inpatient Coding Errors and Proactive Strategies To Avoid Them

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Posted by Global Healthcare Resource & Lisa Eramo on Jan 18, 2024 11:43:09 AM

Inpatient coding is an intensive and complex process, leaving tremendous room for error. Unfortunately, simple mistakes can lead to devastating consequences for providers and patients. For example, an inpatient medical coding error may cause significant revenue loss for a hospital that needs the money to retain its staff. It could prevent patients from accessing the care they need when timely attention is critical. A pattern of medical coding errors could put an organization at risk for audits and unanticipated recoupments. You get the point.

 What can healthcare organizations do to minimize mistakes for a process as nuanced as inpatient coding? Global Healthcare Resource's medical coding experts, Viba Raghavendran, Sivaraj Ramesh, and Samson Kumaraswamy share their thoughts on seven of the most common errors and proactive strategies to avoid them.

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Top inpatient coding errors that cause denials: 

  1. Inaccurate or incomplete documentation. When healthcare providers fail to document essential details of a patient’s diagnosis, treatment, and procedures, medical coders may not assign accurate and complete medical codes. This can result in denials due to unspecified codes, lack of medical necessity, and a whole host of other reasons. 

  2. Inconsistent diagnosis and procedure codes. Medical coders may assign a diagnosis code that doesn’t match the procedure the clinician performed. Again, lack of medical necessity becomes the issue.

  3. Inconsistent or missing modifiers. Medical coders may accidentally omit a necessary modifier or use the wrong one with a particular procedure code.

  4. Invalid codes. Using outdated medical codes may result in denials or delayed payments.

  5. Registration errors and omissions. Incorrect demographic and insurance information may lead to denials due to lack of coverage or because the patient has another insurance that is primary. This error becomes particularly problematic at the beginning of the year when patients often switch insurance plans and healthcare deductibles reset.

  6. Unbundling. Medical coders may separately bill components of a service for which there is a comprehensive medical code.

  7. Upcoding or downcoding. Medical coders must assign codes that reflect the actual service provided. Assigning a higher-level medical code to gain additional reimbursement (i.e., upcoding) or assigning a lower-level code to avoid denials or reduce the patient’s financial responsibility (i.e., downcoding) has legal and financial consequences.  

Seven proactive strategies to reduce inpatient medical coding errors:

  1. Audit claims regularly. New medical codes for FY 2024 promote increased specificity and granularity. Ensure documentation and medical coding reflect these changes. Ongoing audits can also identify other inaccuracies and inform targeted audits and educational opportunities.

  2. Don’t forget about omissions. Omitting diagnosis codes is never a good idea, and it can have a negative impact on risk adjustment and the ability to close care gaps. Ensure coders and nurses work together to capture hierarchical condition category codes and engage patients proactively.

  3. Enforce clear, updated internal coding guidelines. Identify how you’ll handle certain complex coding scenarios for certain payers as well as how you’ll promote overall coding compliance and revenue integrity. 

  4. Invest in medical coder education and training. Regularly train medical coding staff on the latest coding guidelines and medical coding updates. For example, did you know that 395 new ICD-10-CM codes took effect October 1, 2023? The sheer volume and specificity of these codes can pose documentation and compliance challenges. Similarly, there are 25 medical code deletions and 13 revisions. There are also ICD-10-PCS code changes to review for fiscal year (FY) 2024. Coders must understand these changes, review complementary changes in the FY 2024 ICD-10-CM official coding guidelines and FY 2024 ICD-10-PCS official coding guidelines, and always strive to assign the most accurate and complete codes possible.

  5. Keep physicians in the loop. While physicians don’t need to understand the ins and outs of every medical code and payer requirement, what they do need know is this: Clinical documentation impacts medical code assignment. If new medical codes are more specific or have a different description, physicians may need to tailor their documentation accordingly. 

  6. Leverage technology. Use advanced coding software and tools to assist with coding accuracy and augment staff capabilities. Ensure that tools are updated with the latest coding changes and revisions.

  7. Promote open communication. Identify ways to share feedback and invite dialogue between clinicians, coders, and billers. Sometimes all it takes is getting everyone in the same room to problem solve.

With inpatient medical coding, the goal is not to eliminate 100% of the errors that occur. However, drastically reducing them with the help of education, audits, policies, and technology is possible. Take a proactive approach in the New Year and beyond.


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