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Incorrect medical coding corrupts the core data used by health care facilities, has negative consequences throughout health care industry

Guaranteeing accurate, consistent medical codes and patient histories is one of the major challenges for providers and payers today. Medical codes are the starting point for understanding quality of care and making necessary improvements.

“Medical codes are the core data used in every aspect of modern health care—every provider, payer, and facility relies on them,” says Martin Amberger, vice president of operations for AmeriVeri, a provider of pre-payment code verification. “The accuracy of codes therefore has a direct relationship with overall quality of care and the effectiveness of the system as a whole.”

Medical coding quality has an impact on multiple aspects of the health care industry. Reimbursement, benchmarking, clinical and financial decision-making, policy adoption, and research, among other domains, are all dependent upon accurate medical codes.

Moving forward, the system faces significant challenges related to consistency in benchmarking coding quality; identification of the sources of coding errors; assessment of strengths and weaknesses of individual coders to develop educational best practices; and assurance that all codes represent quality data.

Injury and death are only the most serious consequences of medical coding mistakes. Overbilling customers is another possible outcome. Health finance professor Dr. Stephen Parente estimates that 30 to 40 percent of medical bills contain errors; the Access Project puts that figure closer to 80 percent. Meanwhile, Kaiser Health News concludes that $68 billion in lost health care spending can be attributed to medical billing mistakes.

The most recent iterations of coding guidelines have begun emphasizing quality of care and patient safety via more specific codes. However, the success of that strategy still depends entirely on accurate reporting by providers and others who handle medical codes. At the same time, several national initiatives on medical coding have been deployed that further emphasize accuracy.

The Center for Medicare and Medicaid Services (CMS) has made pay-for-performance programs a priority, and it is rapidly expanding nationwide within both CMS and other providers. With pay-for-performance, providers receive differential payments based on specific measures like patient satisfaction, clinical outcomes, structural reforms (e.g., new IT systems), and quality of patient care. Aligning financial incentives to the delivery of optimal care has the potential to measurably improve the efficiency of health care. Because pay-for-performance looks at measures that are typically assigned a medical code, the importance of accuracy in those codes is amplified.

One answer to the challenge is a pre-payment solution, like the ones offered by AmeriVeri and others, that improves patients’ care and ensures accurate medical histories.

Standard, in-house claims management software has its shortcomings. Errors not captured prior to payment are difficult to correct and can have lasting effects, including both overpayment and inaccurate patient records, or worse, patient injury or death.

In today’s environment, an additional step may be required.

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