Do You Know If You Are Upcoding?

February 17, 2015 by Antonio Arias, MBA, CHBME

Topics: Medical Billing, Revenue Cycle Management

Your practice would (hopefully) never deliberately overcharge patients, but you may be guilty of doing it nonetheless. Upcoding – the practice of coding and thereby billing at a higher level of service than is appropriate for services or procedures rendered – is a much more pervasive problem than most medical practices realize.

In 2010, the Office of the Inspector General (OIG) found that, broadly, more than 50% of office visits in the U.S. weren’t using CPT codes correctly and one in four claims was upcoded. And after analyzing data from 329,500 practitioners in 2012, non-profit Pro Publica found that 1,800 providers were billing at the top level of service at least 90% of the time, and around 20,000 health professionals billed only at levels 4 or 5.

If you’re not reviewing and auditing your medical billing practices regularly, you could be part of the problem. Since the Centers for Medicare and Medicaid services has weighed in on upcoding and stepped up their auditing efforts in recent years, it’s important to correct any systemic upcoding issues in your medical billing office before CMS takes note. Here are the three steps to doing that.


1. Aggregate

The only way to spot an upcoding problem is to collect and compare data on your E/M coding and billing. Start by aggregating all of your data for a given period – say, the past six months – from your system into a report, provider by provider. (Once you begin doing this, write down your processes and procedures and make it part of your overall medical billing policy. Plan to aggregate this data regularly to make ongoing internal reviews easier for you in the future.)

Keep in mind that working with a medical billing service can make collecting E/M data, and completing the subsequent steps to spot and correct upcoding issues, much simpler than doing it on your own. A reputable medical billing company can also provide you with easy-to-read reports and DIY suggestions on improving coding accuracy.


2. Evaluate

Review the most commonly used codes per practitioner from your new report, then use the national provider data from CMS to see how your coding compares to national averages in your specialty. (If you work with a sophisticated medical billing service, they can likely calculate variances for new and established patients for each of your most commonly coded E/M services.)

This step is where any inappropriate coding practices – over or under-coding – should become clear. If your coding patterns vary drastically from national averages, you should perform chart audits to ensure the codes are justified.


3. Rectify

Audit a sample of charts against subsequently coded charges to spot where and why coding variances are happening. Does the coding match the documentation? If not, is it because the documentation is missing or inadequate, or because the code is wrong? Which provider’s codes are being miscoded? Which coder is responsible for the miscoding? Look for patterns that can help you determine where your issues stem from.

Then, take action. If your providers need to document patient visits more thoroughly, tell them to and follow up with regular documentation reviews. If your coders need more or better training, arrange it and audit their work more frequently. If your medical coding issues are severe, consider working with a medical billing company to get better reports that can help you spot issues sooner.

Speak with a billing expert today!

Are you interested in learning more medical billing tips? Visit our blog!


Subscribe to Our Blog

Stay in-the-know on trends, best practices, and news affecting the medical billing industry!