Coding Audits: How Identifying Issues Sooner Rather than Later Saves Money for the Hospital/Facility
Coding Audits: How Identifying Issues Sooner Rather than Later Saves Money for the Hospital/Facility
The establishment of a coding compliance program remains a significant effort by the Office of the Inspector General (OIG). This is part of its attempt to engage the healthcare community in combating fraud and abuse.
The OIG developed a Compliance Resource Portal with materials and guidelines for healthcare professionals. A fundamental element to an effective compliance program is conducting internal monitoring and auditing. Hospital and facility coding audits have the added value of ensuring you are running an efficient and profitable, not to mention minimized liability, operation. Earlier detection of any potential coding issues will pay off financially and will reduce risks for additional external audits. Review this article by Karen Youmans, CEO/President of YES, and Vanessa Youmans, COO, published in the Journal of AHIMA (2019). Conducting thorough coding audits and providing organizations with actionable feedback is one of YES HIM Consulting’s main specialties. Contact our team today to start discussing our scalable auditing solutions for your organization.
The Two Types of Coding Audits
Organizations can handle the timing of coding audits in two ways. They can be retrospective, which is a review of already submitted claims; they can also be prospective, an analysis of claims prior to billing. Many facilities prefer retrospective audits, because they don’t want to delay claims and increase their discharged not final billed (DNFB). However, dedicating some extra time upfront will avoid a negative impact on accounts receivable by improving the accuracy of the claim the first time billed and avoid rebilling later.
Importantly, if the organization discovers an error prior to claim submission, no rebilling is necessary. If organizations must rebill to obtain higher or lower reimbursement, this requires additional staff time. Additionally, there is usually a specific window depending on the payer during which the adjusted or revised claim must be submitted. Additionally, with a prebill audit, the learning opportunity is immediate, and organizations can avoid repetitive errors. CMS could also investigate if coders aren’t making corrections in a timely fashion, so a prospective audit helps alleviate that concern. Review our previous article “Coding Compliance Audits: What to Do With Them?” for additional information on how to interpret the audit data.
The Importance of Accurate Coding
The documentation and support of medical necessity by coding translates to better cash flow for the hospital or facility. Coded data must support the decision to admit as well as medical necessity for inpatient status; coding can validate a proper order is written but normally not the medical necessity as that is typically done by clinicians. Fewer rejections and denials will result if coders properly assign hospital-acquired conditions, present on admission, and discharge disposition issues. Hospital and facility accurate billings also rely on coded data to support resource consumption and length of stay. Besides claims billing, accurate and complete coding benefits other areas as well. This includes hospitals’ case mix index (CMI), contract negotiations with payers for managed healthcare, and improved comparison studies and profiling/scorecards such as state comparison studies, PEPPER reports, and the Hospital Value Based Purchasing (VBP) Program.
A good rule of thumb for coding reviews involves ongoing, consistent audits focused on 3.5 to 5 percent of total volume per month. Auditors should review sample cases every week. This routine promotes efficient mitigation of any repetitive coding issues. Healthcare is a complex industry. With the environment of both the providers and the payers constantly changing, enlisting the help of a qualified third-party health information management coding auditing vendor can be of great value in assisting not only with second opinion reviews but also with developing a coding compliance plan that meets your specific needs. Our previous article “Selecting the Right Coding Audit Company for Your Organization” can help you make the right choice. Ultimately, with some well-calculated processes dealing with some upfront focus on coding will boost the bottom line.
Additional Information
Conducting thorough coding audits and providing organizations with actionable feedback is one of YES HIM Consulting’s main specialties. Contact our team today to start discussing our scalable auditing solutions for your organization.
