Overcoding, Undercoding and Inadequate Documentation – How Can They Be Avoided?

In response to the question “What percentage of physicians, in your experience, exhibit overcoding or undercoding patterns?”, John W. McDaniel answers:

“We work with hundreds of physician practices each year, and probably 80% of all the doctors with whom we work undercode. About 15% overcode, and about 5% code accurately. Even those that seem to overcode may not in fact be overcoding, because chart audits will reveal that the real underlying problem is inadequate documentation to support the appropriate code.”

Physician Practice Options, September 2000. “Practice Management Expert Highlights the Importance of Coding Compliance”

 

As we can see, a look into a physician practice’s coding records will reveal a lot about the actual accuracy of their coding. Now, please note that this does not say “coders are doing a poor job of coding” – by no means is this laying the issue on the coders shoulders. What this reveals is that physicians are the ones who are doing a poor job of documenting. Inadequate documentation is a huge issue. Erroneous documentation is another no-no. LATE documentation can even cause issues and discrepancies in a facility’s ability to code accurately.

 

Healthcare Technology Meets Documentation: How Your Facility Can Benefit

“The industry in general is not being proactive in implementing measures that will ensure accurate charging and reduce the amount of denied claims. Technology has the greatest potential for improvement for any provider.”

“Improving Cash Flow with Better Charge Capture & Denial Management” MedAssets & HFMA. October 2005

How do we, as an industry, ensure accurate charging and help reduce the amount of denied claims? First, let’s talk about how we are able to ensure accurate charging. What do facilities charge for? They charge for services rendered and supplies used to render those services. So we must accurately capture services, right? Well, how will we accurately capture services? Through proper documentation. Accurate charges are ensured through accurate documentation. Now, how can we capture accurate documentation? Obviously the way we’ve been doing business (after-the-fact dictation, 3×5 pocketed index cards, among other archaic methods) does not cut it. So, that’s where technology comes into the picture.

Attention CFO’s: Are Your Physicians Capturing Accurate Reimbursements?

“Getting paid for all the services and supplies that a hospital provides would seem like an elemental strategy in order for any hospital to function, but many CFOs are not even aware of the scope of the billing mismanagement issue.”

“Improving Cash Flow with Better Charge Capture & Denial Management” MedAssets & HFMA. October 2005

The issue is not necessarily that CFO’s are not aware of the billing issues, it’s just that they may feel they have ‘bigger fish to fry’. All CFO’s know that getting paid is essential to the bottom line of the organization. But not all CFO’s know the real facts behind billing mismanagement issues. Often times, physicians are leaving money laying on the table because they did not accurately document the services performed on the patient and therefore will not receive accurate reimbursement for those rendered services. This is the very reason why tools to overcome the billing mismanagement issues must be given to the physicians. That’s where the issues begin… physician documentation; but oftentimes the solution is left to the billing office to figure out, when they’re not the ones who created the issue. So ComplyMD aims to nip the problem in the bud — by capturing appropriate documentation at the point of service, in order to avoid dealing with billing issues later on down the road.

Do You Equip Your Physicians with the Proper Tools?

“Hospitals across the country lose multiple millions of dollars every year due to mismanagement of the billing process. No matter the size of the organization, billing inconsistencies affect all healthcare facilities to some degree—even those that are on top of the problem. On average, providers lose 5 percent of gross revenues, and that can translate into millions of dollars for a single organization.”

“Improving Cash Flow with Better Charge Capture & Denial Management” MedAssets & HFMA. October 2005

As we all know, profit margins are tightly squeezed in the healthcare industry. The billing process has a huge impact on those profit margins. What do facilities bill for? Patient encounters. How do they know what to bill for? Through physician documentation. How will these patient encounters be properly documented? There… you’re stumped. It’s not through dictation after the fact, and it’s not on their 3×5 index card they carry around in their pockets.