Medical Billing Solving The Problems Part I Coding Errors

Writen by Lori A Anderson

Medical billing in the United States is fraught with many challenges and problems. The primary goal of medical billing is to receive fair compensation for the work that was performed in a timely manner. However, this is rarely the case. This series will explain those challenges and suggest possible solutions to these problems.

Coding Errors

A large percentage of denied claims are due to simple coding errors. Insurance companies process claims through huge computer systems designed to make sure every piece of information is correct. It is in the insurance company's best interest to deny a claim and force a resubmission for payment. This helps their cash flow and significantly impacts yours.

One study estimates that 90 percent of all claim denials are preventable. Healthcare Informatics website states that, "Of 15 billion U.S. healthcare claims, 25 percent to 40 percent are rejected or denied at some stages in the administrative process. Only half of those are followed up and resubmitted." Newer medical billing systems can drastically help solve this type of problem.

Potential Solutions

Some electronic medical billing systems will now employ sophisticated Rules Engines that will check your claim before it is sent. Examples of some of the messages that you could see are:

• Diagnosis Code Requires Onset Date
• CPT: G0001 is invalid for the specified insurance company
• Procedure Requires Referring Physician UPIN

These types of checks and hundreds more, can ensure that the most common errors will be caught before a claim is sent to the insurance company for payment. Reducing the amount of denials helps your practice in two ways. First, cash flow is increased due to faster payments. Second, the time required to look at a denied claim, research the problem, correct it, and resubmit it can be 5 times as long as the original submission time.

To ensure a smooth running billing operation by reducing the number of coding errors, insist on a claim scrubbing rules engine in your practice management system. Bottom line, clean claims get paid faster.

Lori Anderson is an independent consultant with LAtech working with AntekHealthware on their DAQbilling Medical Billing Software and LabDAQ Laboratory Information System projects.