Medical Bill Denials: How Much Are Clinicians Really Owed?

by  Find-A-Code™
Jan 27th, 2023

Imagine owning an auto body repair shop. You and your staff produce millions of dollars of work every year. But then, an end-of-the-year accounting reveals you are only getting 80 cents on the dollar from car insurance companies. How would you feel about that? It turns out that this is exactly what might be happening to individual doctors and independent group practices.

MedCity News contributor Meade Monger recently put together a piece detailing the problem. According to Monger, medical billing and coding systems are so complex that it's extremely difficult to cross all the T's and dot all the I's necessary to guarantee 100% reimbursement from healthcare payers. Monger says that 80% reimbursement is par for the course.

Apparently, the problem is serious enough that ProPublica has launched its own journalistic investigation. They are asking clinicians and others in the healthcare industry to begin reporting their reimbursement problems in hopes of uncovering just how much money health insurance companies are withholding from providers.

Tens of Thousands of Codes

At the heart of the problem are the tens of thousands of medical billing codes that clinicians, coders, and billers need to deal with. Two of the most popular coding systems, ICD-10 and CPT, have nearly 80,000 codes between them. And then there is the new ICD-11 that the U.S. healthcare system is expected to begin transitioning to.

Monger says the complexities of medical billing and coding start with codes, but don't end there. Another issue is all the rules that different insurance companies and other payers have in place. The rules aren't standard. One company does things one way and another has its own set of rules. It only takes one small mistake to have a claim denied due to what the insurer claims is improper billing.

Everyone in the system needs to do everything perfectly in order to get a bill submitted, accepted, and paid. If the clinician makes a mistake, it cascades along the entire coding and billing chain. Likewise for a mistake made by the medical coder. Unfortunately, the complexities of the system make mistakes far too easy.

What Can Be Done Right Now

There has been an effort within the healthcare industry and government to move our system away from a fee-for-service system to an outcome-based system. That effort is more than a decade old at this point. Unfortunately, only negligible progress has been made to date. If outcome-based goals are ever realized, medical billing and coding could potentially get less complicated.

In the meantime, what can be done right now to help clinicians and smaller practices guarantee they are getting 100% reimbursement? Monger suggests a lengthy list of possibilities, including:

• Code Accuracy – It has never been more important to strive for code accuracy right from the start. Clinicians should no longer pick a code out of thin air and expect the medical coding department to fix it if it's incorrect.
• Compare Records – Practices should be comparing collection and payment records on a regular basis. They should be comparing what they are billing as opposed to what they are actually receiving.
• Practice Accountability – Insurance companies do everything they can to hold healthcare providers accountable. That is a two-way street. Practices should hold payers accountable as well. Accepting less than 100% of what is owed should never be an option.

It will be interesting to see what ProPublica uncovers in its investigation. How much are clinicians really owed? How much money are payers withholding due to technicalities, overly complicated rules, and the natural complexities of the medical coding and billing systems? We might be very surprised to find out what's really going on.