Clearing up coding ‘gray area’ crucial for avoiding costly mistakes

One seemingly minor coding mistake can substantially reduce a rural hospital’s revenue stream — especially when it occurs repeatedly. It might select a high-level E/M code when the documentation only supports a lower level of service, or maybe a physician fails to provide the documentation needed to support an MRI code assignment for a patient with back pain.

These and other medical coding missteps can lead to payer denials, underpayments, and auditor take-backs that cumulatively drive revenue shortfalls. At a time of razor-thin margins, both short- and long-term financial performance may be compromised.

In many instances, the mistakes and their fixes are obvious. However, these types of situations may not always be so black and white. If they were, hospitals could quickly resolve issues in their early stages or even take steps to prevent them in the first place. Oftentimes there are deeper root causes that need to be addressed — which may mean acknowledging and understanding the “gray area” in medical coding.

Getting a grip on the gray area

Think of the gray area as a dense fog that obscures travel down an unfamiliar road. Landmarks intended to help with navigation lack definition, and great care must be taken to avoid hazards that pop up without warning.

This describes the landscape of medical coding today. Layered on top of the inherent complexities of medical coding are factors both internal and external that shroud the pathway to correct, complete, and compliant coding — a foundational component of full reimbursement and a healthy revenue cycle.

Internal factors include severe staffing shortages, uncertainty about outsourcing options, lack of integration between coding and the revenue cycle, an inability to provide adequate coder training and ongoing education, and adoption of emerging and sometimes unproven artificial intelligence technologies.

External factors originate primarily with payers and government agencies in the form of constant coding and regulatory changes, which often are not communicated to providers on a timely basis.

A closer look at staffing challenges

For many rural hospitals, one contributor to the coding gray area stands above the rest: staffing, or lack thereof.

For starters, the demand for coders typically exceeds the supply, making it difficult to recruit and hire qualified individuals. Exacerbating this challenge is staff turnover — specifically, losing coders who are stressed by rising workloads and the increasing complexity of their responsibilities.

The combination of staff shortages and high turnover poses a financial risk at a number of levels, including claim denials due to coding mistakes by inexperienced or overworked coders and an increase in accounts receivable days resulting from coding backlogs. Added to those areas of risk are the high costs of recruiting and training new coders.

Exploring elements of a viable solution

There is no one-size-fits-all solution for conquering the medical coding gray area. Each rural hospital must adopt an approach that addresses its unique set of needs and challenges. Following are potential pieces of a multipronged solution:

• Defining and documenting processes: Well-defined processes help ensure that all team members understand their responsibilities and that workloads are kept manageable by eliminating redundancies and inefficiencies. Documenting these processes prevents knowledge from walking out the door with coders who leave the organization.
• Retaining top-quality coders: From day one, coders (and, really, everyone in the organization) need to understand the importance of their role in the revenue cycle. Other keys to retention include engaging coders in quality initiatives, (i.e., identifying and fixing gaps) and supporting the augmentation of their skillsets.
• Implementing coding automation technology: Crucial questions to ask in the evaluation process include: Does the technology easily integrate with existing hospital workflows? Does it contain embedded resources to increase coding accuracy? Does the vendor offer educational opportunities to boost user proficiency and confidence in using the technology?
• Outsourcing to a proven partner: A high level of coding accuracy and fast turnaround times are not the only criteria to use in evaluating external service providers. Flexibility and willingness to accommodate the hospital’s individual needs are also key attributes, such as filling specific gaps, stepping in to handle the workload of a departing coder, providing auditing and consulting services, or assuming responsibility for a full range of coding functions. It’s also important to ensure the vendor understands and embraces the hospital’s core mission.

Faced with threats to their very existence, rural hospitals are rightly focused on capturing every allowable dollar of reimbursement. This commitment must encompass medical coding — a core building block of the revenue cycle. By proactively addressing the gray area in coding, hospitals can take a big step toward not just surviving current financial challenges but shaping a brighter, more sustainable future.

NRHA adapted the above piece from TruBridge, a trusted NRHA partner, for publication within the Association’s Rural Health Voices blog.

About the author: Stacey Sexton, RHIA, is vice president at TruBridge, an Alabama-based health care solutions company that works with more than 1,500 health care organizations.