In the world of healthcare revenue cycle management (RCM), medical coding compliance is not just about following rules. It’s about safeguarding the integrity of patient’s data and ensuring that healthcare providers are reimbursed fairly for the services they deliver. According to a recent PubMed Journal, the US healthcare system suffers a weekly financial loss of up to $935 million as a result of inaccuracies in medical billing. Thus making medical coding the backbone of healthcare billing and documentation.
What is medical coding?
Medical coding is the process of converting healthcare diagnoses, procedures, medical services, and equipment into universal medical alphanumerical codes. Derived from sources like physician’s notes and lab results, these codes play an important role in tracking patient outcomes and costs associated with medical procedures. The basic idea is to provide accurate and consistent information in a manner that insurance companies can readily comprehend.
What is medical coding compliance?
It refers to the adherence to rules and regulations related to the accurate and ethical assignment of medical codes for healthcare services provided to patients. The guidelines are established by governing bodies like the Centers for Medicare and Medicaid Services (CMS), the American Medical Association (AMA), and more.
This blog will take you through the benefits of accurate medical coding and the 6 best practices to achieve it:
Let’s start with the benefits, which include:
- Timely Reimbursement: Since each procedure and diagnosis has a specific code, any discrepancies between the service provided and the code submitted can lead to underpayments. When accurate coding is done, the need for follow-up actions and appeals is significantly reduced, allowing accurate and timely reimbursement.
- Reduces Claim Denials: A study by AAPC services says that 24% of claims are denied due to coding errors, making accurate coding an absolute necessity. But beyond just denial, incorrect coding can get you stuck in frequent back-and-forth with insurance companies. Accurate coding minimizes this issue from the get-go and ensures that your claims contain correct information. Thus saving you from draining your resources in resubmitting denied claims.
- Optimizes Revenue Cycle Management: Your coding efficiency directly impacts your RCM. As per a study by the Journal of the American Medical Informatics Association (JAMIA), clinics can experience a decrease in revenue due to coding errors, losing around $125,000 per year.
When done correctly, medical coding ensures that all the stages of your billing process, right from the initial registration to final payment reconciliation, are flowing smoothly. Ensuring accuracy and accountability maximizes first-pass acceptance rates and increases your financial stability.
Although it comes with a world of benefits, medical coding compliance is an ever-evolving process that constantly requires proactive strategies and strict adherence to these best practices:
Implement continuous training and learning
Medical coders must be provided with rigorous training, and they must always stay updated with the latest coding guidelines to reduce errors and improve accuracy. For example, you could tailor your training programs to include crucial topics like ICD-10-CM/PCS coding, CPT coding, medical terminology, etc., to cater to the specific needs of your medical staff. Make sure to cover various legal and ethical considerations as well. Including HIPAA compliance, thorough documentation, and fraud detection in your training on compliance and regulation is a good starting point.
Perform timely audits
Establish a routine medical coding audit process to identify errors, differences, and areas of non-compliance. Leverage those insights to implement corrective actions. Also have a professional assess the timelines and accuracy of claim submissions, denial management process, and revenue cycle management workflows. Such routine audits minimize the risk of medical coding denials and contribute to a resilient and precise coding framework.
Utilize technology solutions
Invest in medical coding automation software that helps streamline the coding process and mitigate the risk of manual errors inherent in traditional methods. It is 2025, and today’s autonomous coding tools offer built-in checks, validation algorithms, and real-time updates. For providers looking to stay ahead of the curve, embracing the latest technology, especially through trusted partners like Lexicode, is the smartest move forward.
Have clear communication
Effective communication is pivotal to medical coding compliance. It ensures that medical coders have all the necessary information needed to assign codes accurately to diagnoses and procedures. Whether clarifying procedures, verifying clinical documentation, or addressing denials, clear and concise communication along with proper documentation goes a long way in maintaining coding accuracy.
Build a culture of compliance
Creating a culture that prioritizes compliance is essential for long-term success. It is an environment where every member of the healthcare team understands their role in upholding legal and ethical standards. A compliance-driven culture starts with the organization’s leadership because when leadership demonstrates integrity and adherence to compliance, employees are more likely to follow in their footsteps.
Outsource coding and billing services
Your healthcare organization’s revenue rides on accurate and efficient medical coding. However, there’s no denying that it can be a complex, expensive, and tedious process. Whereas, outsourcing medical coders can offer an invaluable layer of expertise and precision. While in-house measures are essential, outsourcing your medical coding has a plethora of advantages, some of which are:
- Up-to-date certifications – Being a medical coder means staying up-to-date with the latest certifications (AAPC/AHIMA). Occasionally, a major update like the introduction of ICD 10, which brings in a significant increase in the number of codes, creates a substantial change that coders need continuous training on. When you work with LexiCode’s medical coding specialists, you don’t have to worry about these specifications, as we continuously train our coders to keep them up with the latest updates. We do this to ensure zero disruptions and absolute business continuity in your practice.
- Saves money – In many instances, outsourcing medical coders turns out to be more cost-effective than hiring, training, and maintaining an in-house team. Employing highly skilled medical coders is expensive as their experience commands a higher salary, whereas, at LexiCode, you get the cream of the crop at a much lower cost.
- Focus on what matters most – Doing medical coding in-house consumes a lot of time and resources that could otherwise be used on core activities. Outsourcing your medical coding means that your staff has more time to focus on patients, helping to improve the quality of care. When you work with a trustworthy and competent coding company, you don’t have to worry about medical coding compliance. Leave it to the pros to ensure accurate coding, regular audits, and timely reimbursements.
Compliance is the need of the hour
Implementing best practices in medical coding is absolutely non-negotiable for achieving accuracy, compliance, and financial stability for healthcare providers. If you are looking to outsource your medical coding, LexiCode, with more than 25 years of experience in Health Information Management, could be your ultimate partner.
All our coders are certified by the American Academy of Professional Coders (AAPC) or the American Health Information Management Association (AHIMA) and use our proprietary coding software to deliver unparalleled services.
Want to know more? Contact us and start seeing results!