Revenue Cycle Management

Most Common Billing Errors

Nov 1, 2019 · 3 min

Patient care isn’t restricted to just the treatment, it extends to the administration and billing, too. Patients depend on physicians to treat them, but they also trust the office to protect their information, write the correct prescriptions, and bill them correctly. Unfortunately, it’s approximated that about 80% of medical bills contain some type of mistake.* 
Medical billing errors commonly occur because of data entry oversights and typographical mistakes, but such simple errors can cause an extravagant amount of extra work needed to amend the situation. These oversights can lead to significant time needed to track and amend the source of the mistake, which in turns creates a delay in payment and reduces patient satisfaction. Ensure correct billing and retain patient satisfaction by watching out for these common billing errors:

1. Upcoding
Upcoding occurs when a patient is improperly charged for services or treatments not received. For instance, this can happen if the medical billing code is changed to represent a move severe diagnosis or treatment, or if the code represents name-brand medication if generic medication was used. 

2. Unbundling
Unbundling happens when charges that should be billed under one code are listed separately, or unbundled. Instead of being billed together as a somewhat “package deal”, these expenses get billed separately and therefore increase the cost. An example of this would be if multiple medical tests should have been categorized under one code but instead get billed individually. 

3. Duplicate Billing
Duplicate billing is when something (procedures, services, medications, etc.) gets billed multiple times. For instance. this can happen if both a doctor and a nurse bill for a service without knowing that the other had already billed for it, or if the patient is mistakenly billed for multiple “first day” appointments as subsequent visits may have different rates. 

4. Lack of Medical Necessity
An insurance company may deny a claim due to there being a “lack of medical necessity” if there is insufficient information to support the claim. This could happen if the wrong medical diagnosis code is used because the coder inputs the information incorrectly or if inaccurate diagnosis information has been provided by the physician.

5. Incorrect Information
Any type of misinformation, which can include simple misspellings, errors, or omissions of information, can cause an insurance company to reject a claim. Any typos or errors can cause billing issues, such as misspelling a patient/providers name, address, birth dates, or insurance information. Data can be subject to the control of multiple people throughout the billing process, so mistakes can easily be made if the information isn’t meticulously inputted and double-checked, or if there is ineffective communication amongst the staff. 

6. Incorrect Procedure Codes
Incorrect codes may be inputted due to simple typing mistakes, missing or incorrect information given to the coder, or if the coder isn’t up-to-date on the latest coding rules. This can partly be avoided by ensuring continued education programs are provided to keep employees updated on the latest coding requirements. There could also be a mismatch between the treatment and diagnosis codes if one gets mistakenly upcoded.

7. Wrong Insurance Company
A common yet easily avoided billing error is when a claim gets sent to the wrong insurance company. This can happen if the person entering the insurance information doesn’t have pictures of both sides of the insurance card or if they simply aren’t paying attention. 
It’s important to stay informed on these common billing errors so that you can best anticipate any potential problems and prevent them from occurring. Medical billing errors can cause detrimental damage to a clinic, but many could be avoided by effective communication amongst the staff, paying close attention to detail, staying educated on billing codes, double-checking work, and by being aware of these common billing errors!

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