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.

 

Accurate Charge Capture: Help Physicians Acquire Appropriate Documentation

“With profit margins squeezed so tightly in the healthcare industry, it’s hard not to think that any loss of revenue would not affect the bottom line. Accurate charge capture and claims denial management processes mean not only improving cash flow, but also protecting revenue that the provider is entitled to—and that all adds up to a healthier bottom line.”

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

Yes. We are all aware of tightly squeezed profit margins. But, do we know how to improve those profit margins? Accurate charge capture and claims denial management are two such areas that could help improve a healthcare organization’s bottom line. Let’s look at inaccurate charge capture vs. accurate charge capture. Inaccurate charge capture can be caused for several reasons, such as undercoding (loss of revenue), overcoding (risk of fraud), lack of knowledge in accurate documentation, lack of tools to capture accurate charges, etc. The list goes on and on.