The adoption of electronic health records (EHR) significantly changed the workflow in today’s physician practices. One major difference is the way in which physicians select evaluation and management (E/M), CPT and ICD codes.
Rather than circle a code on a paper charge sheet, physicians now choose a code from a drop-down menu in the EHR. In many cases, electronic code selection saves money and streamlines the revenue cycle.
Although these efficiencies are beneficial, practices still need to monitor the accuracy of the codes they assign. Without continual monitoring, practices could experience the negative consequences of decreased revenue and an increase in denials and audits.
There are many reasons why physicians choose to assign their own codes. Consider the following:
When physicians assign their own codes after the patient encounter, medical groups reduce or even eliminate the need for in-house or outsourced coders. The savings gained from assigning one’s own codes could be significant. That’s because in-house coders earn, on average, $50,000 annually. Eliminating the need for outsourced coders can also yield a significant savings. (source)
EHR advancements have simplified the code selection process, making it easy for physicians to select an accurate code with minimal effort and with minimal disruption to the physician’s workflow.
The entire revenue cycle process is shortened when physicians assign codes directly through the EHR. That’s because claims don’t wait in a queue waiting for a coder to review them.
Although practices gain efficiencies and reduce costs when physicians assign their own codes, there are also several pitfalls to this process.
Denials due to undercoding
As physicians navigate the complex medical coding system, they may intentionally undercode their services to avoid payer and auditor scrutiny. However, doing so means that physicians could also miss out on significant reimbursement to which they’re entitled. Approximately 15 percent of claims are undercoded, costing physicians an average of approximately $23,000 in missed revenue annually. (source)
Denials due to overcoding
Because payers tend to monitor providers who consistently bill higher-level E/M codes, overcoding these services can present significant compliance risk for those physicians. (source) Primary care physicians overcode or underdocument 27 percent of submitted claims, putting $41,000 of annual revenue at risk for an audit. (source)
If the federal government suspects overcoding or undercoding, it may audit a provider and fine him orher up to $10,000 per line item. (source)
However, physicians spend approximately 50 percent of their time completing tasks in the EHR and performing other administrative work.
They spend only 27 percent of their time providing direct patient care. (source)
However, when they assign their own codes, there is no feedback loop. By the time they hire an auditor to provide this information, the patient encounter is a distant memory.
With all the potential pitfalls for physicians selecting their own codes, hiring a certified medical coder can come in handy.
Practices using an EHR must ultimately answer this question—will physicians or coders assign codes? Many experts believe that coding should be a shared responsibility, as this model has been proven to decrease coding backlogs1 and increase coding accuracy.
An appropriate blend of technology and coders could be the right solution for many medical groups. As providers consider whether to hire a certified professional coder or to bring someone into the practice to audit periodically, they must determine whether the services are worth the cost. Many organizations use computer-assisted coding, for example, to achieve their compliance goals with far fewer in-house coders and a reduced need to rely on outsourced coders as well. (1source (PDF, 2.67 MB))
Whether your organization wants to increase its capabilities in assigning E/M codes using computer-assisted coding, or optimize your revenue cycle by outsourcing the coding function, 3M Health Information Systems has the tools to help you focus less on getting paid and more on direct patient care.
3M™ 360 Encompass™ Professional System: A revolutionary new application that channels the power of 3M’s proprietary computer-assisted coding, physician query capability and reporting, putting them to work on the professional fee side of the coding workflow.
Check out our case study to see how 3M helped UC San Diego Health increase coder productivity by 74 percent. See study (PDF, 653 KB)
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