Opportunities to Reduce Coding Cost and Liability in Provider Organizations
Medical coding is one of the most pervasive and serious challenges provider groups, hospitals, and health systems face. The challenge of finding high quality, highly trained staff that works efficiently and effectively has grown ever more difficult, and the liabilities involved in coding errors have become increasingly steep.
Ongoing Coder Shortage
The advent of ICD-10 codes exacerbated the ongoing challenge of finding qualified coders: The explosion of new codes in the latest set—from around 17,000 codes to 140,000 codes—dropped coder productivity 50 to 70 percent, reduced the number of qualified coders on staff and in the applicant pool, and motivated a number of coders experienced in the ICD-9 system to move into retirement rather than learn a newer, even more complex system.
Further, the implementation and ongoing fluctuations of the Affordable Care Act on the number of new patients entering and exiting the system has caused volume gluts that haven’t yet resolved.
System Costs for Coding Departments
The costs of recruiting, hiring, training, and ongoing skill-set growth are extensive for large provider groups and hospitals and health systems.
Most groups keep full-time recruiting staff in place to build relationships with coding training programs at schools and universities and dedicate human resources professionals to develop coder career paths and provide mentoring programs that improve job satisfaction and offer ongoing growth. Boston’s Beth Israel Deaconess Medical Center created paid internships and covered from-scratch coder instruction, which can take anywhere from 700 to 1,000 hours of coursework in areas that include physiology, anatomy, and pharmacology.
Without extensive onboarding, nurturing, and opportunity, coders will leave for other opportunities at other organizations—and turnover is an expensive proposition for any organization, especially when it comes to qualified, hard-to-find staff. In the coding field, the cost of turnover can be 1.5 times the person’s salary, according to a presenter at the AAPC annual HEALTHCON conference.
With medical coder salaries at around $50,000 and higher, depending upon the number of certifications involved, these turnover costs can become painfully expensive for organizations squeezed by tightening reimbursement and a need for ever more careful cost control.
Coding Error Liabilities
Unsurprisingly, increased coding complexity and straitened coding resources have escalated the rates of coding mistakes above the numbers found by the American Medical Association in 2013, when 7.1 percent of paid claims contained an error. Groups that review bills for patients, such as the Medical Billing Advocates of America, claim today’s error rate has reached 75 or 80 percent.
While the latter statistic may seem high, there’s no doubt that errors are rampant—and costly.
What comprises a coding error? Coding errors include upcoding (making charges overly specific), downcoding (listing charges as overly generic), mismatched coding (the treatment and the diagnosis do not align), lack of documentation for medical necessity, and beyond.
Coding and, subsequently, billing errors can lead to the following serious issues for providers:
- Financial instability is common when rejected claims require correction and resubmission, resulting in wasted staff time and cash-flow challenges.
- Insurance audits drain valuable staff time and cause unwelcome distraction for busy organizations. Further, unsuccessful audits can result in the practice owing the payer funds.
- Patient problems due to coding issues can prevent patients from accessing timely treatment and can even lead to medical mistakes.
- Fraud investigations from government agencies and private payers occur frequently because of bad coding, as these groups are on high alert for costly business practices from incompetent or bad-acting providers.
- Legal actions can be triggered by shoddy coding practices and can come from individuals, state and federal law enforcement, and insurance companies.
The reasons for bad coding are myriad, from stressed and short-handed coding departments, to poor training for coders, to limited oversight of coders in practice. Ensuring quality coding in a complex practice requires constant vigilance and regular internal coding audits.
Missed Charge Capture Gains
Further, poor coding can lead to lost revenue through missed charges that could have been billed. In today’s health care environment, these missed income opportunities compound across the organization.
Setting careful standards and processes for charge capture can increase provider revenue by 25 percent, in some cases. Per the American Health Information Management Association, poor charge capture processes are responsible for the loss of millions of dollars in revenue every year. Good coders don’t miss important opportunities.
What could your group do with the lost income?
Opportunities for Addressing Coding Challenges
Increasingly, large provider groups, hospitals, and health systems have come to resource Shearwater Health to help optimize the coding function within their organizations.
Shearwater Health has trained, licensed, experienced medical coders performing under Lean Six Sigma standards and strict performance-based oversight to increase charge capture, reduce errors and rejected claims, and eliminate the cost of recruiting and turnover in coding department.
Shearwater Heath can build a high-performing, efficient, effective coding team for your organization in a fraction of the time and for a fraction of the cost than your organization can build independently. In fact, on average, Shearwater Health saves organizations 30 percent of their current coding-department costs.
Shearwater Health has extensive experience to bring to your organization’s coding needs. Further, Shearwater Health has greater than 95 percent quality ratings for all lines of business in coding, including inpatient, outpatient (facility), and outpatient (professional).
Can you afford not to call us? Contact Shearwater Health today: email@example.com or 615-921-9510.
You’ll be impressed by how we can help you.