There are more than a hundred dermatology CPT codes. From skin biopsy to excision, from lesion destruction to wound repair and more – so many procedures involving the largest organ in the human body. Each procedure has many sub-procedures having unique CPT codes. For example, there are at least 8 different types of procedures pertaining to skin biopsies each with its own CPT code! On top of that, assigning a code to a diagnosis or a procedure can be an extremely subjective affair. These issues make Dermatology medical billing prone to mistakes and pitfalls.
Why Do Coding Errors Happen?
Dermatology medical billing and coding errors happen because these skin treatment procedures entail complex dimensions and subjectivity. When a physician performs a skin treatment, she takes the following into account:
- Diagnosis
- Type of procedure
- Location of the disease and treatment
- Size of the tumor or lesion
- Quantity of skin condition(s)
- Prescribed tests
- Test results
Cherry on top, the same dermatological procedure can be done with different intent. For example, a dermatologist can scrape the entire lesion for biopsy – which is typically known as excisional biopsy. Again, the same procedure can be used to scrape the lesion. The two procedures have separate CPT codes – hence billing for these two will vary as well.
Then there are nuances to medical coding and billing that physicians and Dermatology billing companies might not be able to wrap their minds around. For example, if a patient comes to a dermatologist after undergoing a biopsy for re-excision, then the billing staff should take the final suture line into consideration while assigning the medical code.
Improper Medical Coding Can Have a Huge Impact
Most studies focusing on medical coding errors tend to highlight upcoding practices more. Upcoding is the act of assigning medical codes denoting more serious or complex medical procedures than what was actually performed. However, inadvertent medical coding errors lead to significant monetary loss for clinics and physicians.
| To avoid audit from insurers or potential investigation, medical practitioners often undercode. According to a study conducted by Samantha J. Champagnie of University of South Florida, undercoding and overcoding occur almost at the same rate. |
- Impact On Physicians or Clinics
- Financial Loss
Errors in medical billing for Dermatology can have a significant monetary implication for practices. If a physician is found guilty of submitting false claims – in the form of inaccurate medical coding – then the person can be slapped with penalties that can reach as high as $10,000. Additionally the physician has to shell out thrice the total amount of loss sustained by the government due to the suspected submission of false claims.
On the other hand, just to avoid being investigated by the government or insurers, physicians often undercode – reporting less complex procedures than the actual ones. Billing and insurance related activities cost healthcare professionals 62% of the total administrative overheads. Undercoding helps them reduce this cost. But ultimately, physicians are foregoing what’s rightfully theirs.
- Legal Impact
Medical practitioners can be subject to severe legal sanctions in case of medical coding and billing errors – irrespective of whether they are done intentionally or unintentionally. In fact the US government can even restrict offending physicians from being the beneficiary of government programs. In a study conducted by Chen, Alice et al, it was revealed that during the 10-year period spanning 2007 to 2017, the number of physician exclusions grew by 20% YoY. In a country where a whopping 119.1 million people are enrolled in some kind of public insurance program, physicians excluded from government insurance reimbursements face a dramatic loss in revenue.
- Damage To Reputation
If a medical practitioner’s clinic gets investigated for a suspected insurance fraud, it could bring significant reputational damage. This damage to reputation can further lead to loss of revenue.
- Impact of Medical Coding Error on the Patient – Doctor Relationship
Improper medical coding – either knowingly or unknowingly can create a misunderstanding between the practice and the patient. Here’s a real instance where the medical director of a clinic asks the NP to use CPT 99205 for every new patient visit without taking the actual complexity of the issue or the consultation time into account. Patients who underwent treatment in this clinic were in for a rude shock. Not every treatment or procedure would come under 99205 especially those with low level complexity leading to very easy medical decision making (MDM).
- Impact of Coding Error On Patients
Error in Dermatology billing impacts patients negatively in two major ways:
- Financial Shock
Look at this Reddit post. A practice assigns code for injectable drugs even when all it did was make patients take oral medication. As you know, injectable drugs cost more than the same drug that needs to be orally administered. Patients who went to the clinic were charged more than what was expected. This is just a simple example. Errors in billing & coding for Dermatology practice can make a medical bill shoot as high as $900.Now imagine what happens if the insurance company refuses to foot the entire amount.
- Incorrect Diagnosis
Here’s a scenario. Suppose a person went to a practice with the complaint of lumbar pain. But the coder incorrectly assigned M54.4 which is lumbar pain with numbness (sciatica). The correct code should have been M54.5. Assigning incorrect codes leads to treatment that may be incorrect, irrelevant or outright dangerous.
- Impact on the US Public Funds
Incorrect Dermatology medical billing thanks to medical coding errors result in the US government losing billions. According to the Office of the Inspector General, 50% of erroneous payouts under Medicare Part B can be attributed to E/M services. These erroneous payouts have a serious impact on the quality and sustainability of public health insurance services.
The Bottomline:
Medical coding errors have serious implications on the health of the healthcare industry as a whole and dermatological industry in specific. Coding errors and bill-shocks can make patients avoid going to clinics in the future. This can lead to serious consequences. Remember, dermatological conditions don’t just entail warts or corns – they can be as serious as skin cancer. It is therefore extremely imperative for practices to employ robust, error-free medical coding mechanisms. At RCM Workshop, we know the importance of accurate medical coding for both physicians and patients. Contact us to make your clinical coding process data driven and helpful. You and your patients deserve it.
