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Common Medical Coding Mistakes

Healthcare cost concept with medical bill and health insurance claim form

Proper coding is extremely important in the operation of a medical practice. Improper coding leads to improper billing, which can lead to significant liability and even criminal charges for a healthcare practice. Billing practices need to be clearly established and administrative staff must be properly trained in order to avoid costly mistakes. Not all coding errors are malicious attempts to defraud customers; often, coding errors are simple mistakes. Below, we discuss some of the most common medical coding mistakes made by healthcare staff. If you need help establishing best practices or dealing with compliance matters, call an experienced California healthcare law and compliance attorney.


Upcoding occurs whenever a patient is billed for more than they obtained. The patient might be billed for more procedures than they obtained, billed for a procedure that was scheduled but never occurred, or improperly billed for a procedure that simply never took place. Upcoding can happen when an employee mixes up the billing codes for different procedures or is confused by the information provided by the treating physician, especially if the physician fails to provide full and precise information.

Undercoding, meaning coding for less expensive procedures than those actually performed, is also an issue. Deliberate undercoding is still fraudulent and can lead to audits and investigations.

Insufficient Data

Omissions or incorrect information in a claim can lead to claims being rejected or other billing errors occurring. Employees should be trained to double-check all fields on a claim form before submitting a claim. Names, addresses, gender, birth dates, and other identifying information should all be entered and entered correctly, no matter how insignificant it may seem. Missing information can lead to mistakes as dramatic as information being entered on the wrong patient’s record, which can lead to a denied claim or the wrong patient getting billed. Overworked billing departments commonly leave out information on accident, but keeping an eye out for missing data should be a priority for any practice.

Failing to Update to Current Codes

Perhaps a subset of the upcoding issue or other coding errors, one common mistake occurs when new codes are issued by the organizations that maintain the relevant coding manuals. If new coding standards are issued, billing departments must make sure to retrain employees on the new codes. Using outdated codes can lead to over or under-billing, or claims being denied.

Improper Telemedicine Coding

Telemedicine technology is the future for healthcare practices. It allows for the provision of high-quality healthcare to patients around the country, even in remote locations or when issues such as the pandemic limit in-person access. Telemedicine comes with its own set of technical and billing headaches, however. Certain code modifiers indicate that real-time telehealth services were utilized, such as a consultation over a video or telephone system, while other modifiers indicate that an “asynchronous” telecommunication system was utilized, such as sending an x-ray via email. Coders must be specific and accurate in order to submit proper claims and avoid under or over-billing.

Unbundling Codes

In many cases, there is a single code that operates as an umbrella code for the various components of a procedure. Each constituent procedure may have its own code for when only that part is performed, but coding each procedure separately when there is meant to be a single umbrella code can lead to overbilling.

Mishandling Overpayments

When a coding error leads to an overpayment, or if a payer pays too much or too little for any particular reason, the healthcare provider must rectify the issue. A provider who allows for overpayments and fails to notify the payer when discovered may be liable for the damage done. Providers must immediately rectify any overpayment or underpayment and process any relevant interest calculations where appropriate.

Seasoned Advice and Dedicated Representation for Your California Medical Practice

For assistance with matters of healthcare regulatory compliance, auditing, fraud defense, employment disputes, mergers and acquisitions, business disputes, licensing, or any other healthcare legal issue, contact the Law Offices of Art Kalantar in Los Angeles or California statewide at 310-773-0001.

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