Why is Coding Important to Billing?

Why is Coding Important to Billing?

Efficient medical coding lays the groundwork for successful billing and reimbursement for the hospital or practice.

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Medical coding forms the basis for billing. It is the assigned codes that are billed to the insurance company. The coder assigns the right diagnosis and treatment codes corresponding to the diagnosis the doctor has arrived at, and the treatment he has provided to the patient. The biller then adds those codes to the billing software and then submits the claim to the insurance provider covering the patient. Medical billing, therefore, begins with coding, and only the right coding can ensure proper billing and eventually appropriate reimbursement for the hospital or physician practice.

Earnings Depend on Codes The medical codes, though exhaustive and at times confusing, actually facilitate efficient recording of the patient’s care history. The codes help in comparing projects, and provide a reference for other physicians dealing with similar health conditions in their patients. Coding therefore helps improve healthcare. It also helps in improving administrative functions and expediting payment for services rendered by the physicians by enabling the billing process to function more efficiently. Without the right codes, claims cannot be sent to insurance companies – it would affect payment and strike at the bottom-line of the practice. Ultimately it would trickle down to the quality of healthcare rendered.

Efficient Billing Depends on Efficient Coding Medical coding and billing are essential for the hospital or physician clinic’s cash flow, but coding is the first step towards that. That is why it is essential that the practice hires an experienced coder. Larger hospitals would need a team of coders to handle all the workload. Small practices sometimes function even without a coder and make use of some practice management software. For larger practices and hospitals though, it is important that they hire trained and experienced coders.

Coding Involves Communication and Research Coders often interact with physicians to clear any doubts regarding the diagnoses or procedures performed. This is essential, because wrong or unspecified codes could affect payment from the insurance company. They also provide insights to the other staff on collecting the required information. Sometimes coders also explain the

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various charges to patients, a task usually done by billers. The right coders are therefore major assets to a practice.

While billers have the ultimate responsibility of billing insurance companies by presenting them with claims and the supporting documentation, the coders have the major task of assigning the right codes. For that they not only communicate with physicians and nursing staff, but also review transcribed medical records such as doctor’s notes, imaging studies or requests for them, laboratory tests, etc. They assign codes based on their observations of each and every diagnosis, procedure, scan and test. In other words, coders do the bulk of the research and set the groundwork before the billers come in. Billers then verify the right billing format, assign the appropriate modifiers, and ensure that supporting documentation is submitted with each claim.

Outsourcing Medical Coding Coding is necessary in various settings, be they private or government hospitals, rehabilitation centers, nursing homes, or physician groups. A reliable coder and coding system are among the greatest assets for a healthcare organization and even insurance companies. Sometimes, outsourced medical coding services are the right solution particularly for small hospitals and practices. Outsourced services ensure more reliable handling of coding without hospitals having to recruit coders.

And since the earnings of the practice depend on coding, it is wise not to take chances.

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