Improve Your Revenue Cycle With Accurate Coding

The goal of the revenue cycle is to receive reimbursement. So how do you make sure you’re reimbursed accurately and on time? The answer may seem complex, but it comes down to accurate coding.

Medical billing and coding are two of the most important factors of the revenue cycle, yet the importance of coding accurately is often not monitored, assessed, or facilitated as much as it should be. Accurate medical coding leads to clean claims, prompt reimbursements, and a positive bottom line. Coding errors in the medical billing process can lead to lost revenue.

Medical codes support the claim that you send to a patient’s insurance provider for services. Claims paid by patients and/or insurance companies ultimately drive the financial operations of medical practices. Yet it can take weeks to months for a medical practice to get reimbursement, depending on the nature of the patient’s illness, diagnosis, treatment, selection of medical codes, and dealing with potential claim denials due to coding errors. Therefore, it is important to submit the correct codes the first time around to get paid the full amount due as quickly as possible.

What Is the Revenue Cycle?

The revenue cycle spans everything from patient registration and documenting the medical record to receiving payment for services provided to patients. Coding lives at the center of the revenue cycle, with reimbursement at the end. Getting reimbursement for your services is necessary to sustain your operations. It is equally as important for the patient, who relies on payer support for their procedure costs. The revenue cycle breaks down into five steps:

Step One: Pre-Authorization and Eligibility Verification

The first point in the revenue cycle is gathering the patient’s insurance and financial information for pre-authorization and registration. Price transparency and insurance verification tools can improve this step within revenue cycle management (RCM) by giving the patient the most accurate information possible before any services take place.

Patients who are not expecting to receive charges for services rendered may be surprised and take extra time to complete reimbursement after working with their insurance or even your organization. Gather comprehensive information in the first step of the medical billing process is key to success.

Tips to improve this step:

• Price transparency
• Insurance and pre-authorization verification

Step Two: Services and Charge Capture

Once a patient has received care, the second step of revenue cycle management is to translate that care into medical billing codes in a process called charge capture. The codes are for reimbursement but also for capturing a comprehensive medical record for the patient.

The patient’s medical record includes their history, diagnoses, tests, and treatments. Clinical documentation integrity within this record is essential in both the revenue cycle and patient care processes. Ensuring coding accuracy up front can save hundreds and sometimes thousands of dollars in claim rework and administrative costs associated with claim rejections.

Tips to improve this step:

• Code correctly the first time.
• Maintain a comprehensive medical record for each patient.

Step Three: Claim Submission and Denial Management

Next up in the revenue cycle is submitting a claim. Once the charge capture process is complete, the coded claim goes to the insurance payer. If the claim is denied for any reason, you will need to resubmit as soon as possible. Otherwise, it can lead to lost revenue.

According to the Journal of AHIMA, unresolved claim denials cause an average annual loss of $5 million per hospital. This represents up to 5% of net patient revenue. Additionally, charges incurred for each claim denial must be reworked or appealed. This is where correct coding up front can save you valuable time and money.

Avoid the most common reasons for denials and invest in quality education for your team. You can improve this step in the revenue cycle by using a quality medical billing solution to quickly identify common coding errors and course-correct them to prevent future denials.

Tips to improve this step:

• Invest in staff education.
• Audit claims to ensure they are clean before submitting.
• Use a quality medical billing solution to identify common errors and prevent future denials.

Step Four: Payment

After the patient’s insurance company reviews the claim, the payer will submit reimbursement. The patient receives a notification for the remaining out-of-pocket cost. This step often includes collection services from your RCM vendor to optimize patient payments and help your patients manage their medical debt.

Step Five: Reporting

Receiving payment is the last step in the revenue cycle management process. However, you also need quality reporting to monitor the ongoing health of your organization. Analyzing the data allows providers to identify errors that may be occurring throughout the cycle and lower expenses from denials, incomplete claims, or healthcare fraud investigations. Proper reporting is essential to optimize the revenue cycle from start to finish.

Accurate Coding: The Most Important Piece of the Puzzle

You’ll notice that documenting the correct codes for patient services rendered is only one part of the entire revenue cycle process. However, correct coding is invaluable for both the patient and your organization.

Ensuring Patient Record Integrity

Medical coding must accurately report the services provided and reflect only the active diagnoses, comorbidities, and history that might affect patient outcomes. Conditions that no longer exist or have no effect on the care that the patient sought should not be coded. Coding errors can affect the patient’s future health care, insurance, and payments.

Coding accuracy is also crucial for the integrity of a patient’s medical record. It will tell a full story of the patient’s medical history and support medical necessity — which is essential for payment and authorization of future services. Medical coding guidelines and regulations, such as the National Correct Coding Initiative Annual Edits are in place to ensure compliance and accountability. Accurate coding also ensures that quality data is provided for public health research.

Preventing Reimbursement Delay or Denial

Not only is accurate coding important for patient care; it also leads to more precise reimbursement payments and prevents denials or delays in payment. It enhances clinical, financial, and administrative planning and performance monitoring. As highlighted in a 2020 Medicare CERT Report, 49% of improper payments were due to missing documentation or coding errors, which equates to revenue loss for the organization as a whole.

Prioritizing Clinical Documentation Integrity

Correct medical coding is an essential step in the revenue cycle process and should always be a priority. It is beneficial for both the patient and the financial integrity of your organization. Clinical documentation integrity affects all participants in the revenue cycle, from patients and providers to coders and billers to insurance companies and beyond. Working with the right partner can help you navigate the process of finding the best coding consulting and other resources.

Read the white paper below and see our infographic, Coding pitfalls: Are they sinking your revenue?

About Our Partnership With Revenue Cycle Coding Strategies

Relias partnered with Revenue Cycle Coding Strategies (RCCS) to offer resources to ensure that your coding is compliant and to help optimize your revenue cycle. In addition to quality online courses from Relias to invest in your staff’s coding education, RCCS offers a variety of outsourced solutions for your organization, including coding audits, documentation reviews, coding professionals, and expert resources.

About Revenue Cycle Coding Strategies

Revenue Cycle Coding Strategies has provided specialty medical coding, revenue cycle, and compliance consulting services, as well as educational and training materials to the healthcare industry for over 20 years. RCCS has an extensive team of specialized coding experts and industry leaders who create and implement customized revenue cycle solutions, including billing auditing and assessments, compliance reviews, in-depth process mapping, and customized outsourced options.