Learning resource:
Harrington, M. K. (2016). Health care finance and the mechanics of insurance and reimbursement. Burlington, MA: Jones & Bartlett Learning.
- Chapter 9, “Coding for the Non-HIM Professional” (pp. 185–206)
- Chapter 10, “Revenue Cycle Management” (pp. 209–224)
- Chapter 11, “Healthcare Fraud and Abuse” (pp. 227–244)
Assignment: Coding Accuracy Case Study
The importance of accuracy in medical coding cannot be overstated. Proper coding leads to proper payment. Unfortunately, some providers and organizations attempt to manipulate revenue by coding for more services at a higher level of complexity in order to get larger reimbursements from insurance companies. This practice is known as “upcoding.” The Healthcare Financing Administration (HCFA) does monitor for upcoding, but its processes are not adequate, and many upcoded claims for diagnosis-related groups (DRG) are overlooked.
In this Assignment, you consider a case study about the HCFA’s monitoring of upcoding and develop an action plan for improving the monitoring process. You also discuss the elements that should be included in a payment error prevention program and the implications of fraud and abuse in healthcare.
To prepare for this Assignment:
- Review this week’s Learning Resources.
- Read the document, “Case 9: Coding Accuracy,” located in this week’s Learning Resources.
- Reflect on how DRG upcoding was detected through electronic claims data.
The Assignment (2- to 3-page paper):
After reading the case study thoroughly, write a paper in which you respond to the following:
- Propose an action plan outlining what the Healthcare Financing Administration (HCFA) should do to monitor DRG upcoding.
- Recommend key elements to be included in a payment error prevention program.
- Explain the implications of fraud and abuse for this case. Then, discuss the broader implications of fraud and abuse. What are the consequences, and who is impacted?
Provide specific examples in your paper. Support your post with the Learning Resources and at least one current, outside scholarly article (less than 5 years old).
Expert Solution Preview
Introduction:
The importance of accuracy in medical coding is paramount. Coding helps in proper payment, but some organizations engage in upcoding in an attempt to inflate their revenue. The Healthcare Financing Administration (HCFA) is charged with monitoring upcoding, but its processes are not adequate. This discussion evaluates a case study on HCFA’s monitoring of upcoding and proposes an action plan for improving the monitoring process. It also discusses the key elements to be included in a payment error prevention program and the implications of fraud and abuse in healthcare.
1. Action Plan for Monitoring DRG Upcoding
To prevent upcoding of DRGs, the HCFA should adopt a multifaceted approach. Firstly, it should conduct random sampling of claims data to identify upcoding patterns. Secondly, it should install an internal control system that performs regular audits of claims data to pinpoint discrepancies. Thirdly, the HCFA should engage in provider education on proper coding techniques and the implications of upcoding.
2. Key Elements of a Payment Error Prevention Program
A payment error prevention program should comprise several key elements. Firstly, it should involve regular data quality checks to ensure accurate and complete data entry. Secondly, it should have well-defined coding procedures, including training for coding personnel. Thirdly, the program should incorporate periodic audits of coding and billing practices, with corrective measures instituted when necessary. Lastly, the program should have management oversight to ensure adherence to the defined policies and procedures.
3. Implications of Fraud and Abuse
In this case, upcoding constitutes fraud and abuse. The consequences of fraud and abuse in healthcare are far-reaching. They lead to losses of billions of dollars annually, erodes the public’s trust in healthcare, and puts patients’ health and lives at risk. The individuals most impacted by fraud and abuse include payers, providers, and patients. Payers are often the biggest losers, as fraudulent claims result in unwarranted payments. Providers may face criminal and civil charges, which can result in loss of licensure, fines, or incarceration. Patients who receive unnecessary services may face physical harm or incur undue financial obligations.
Conclusion:
Proper coding is vital for accurate payment, and upcoding poses a significant risk to the healthcare system. To prevent upcoding, the HCFA should adopt a multifaceted approach, including provider education, internal controls, and random sampling. A payment error prevention program should incorporate key elements, such as data quality checks, defined coding procedures, periodic audits, and management oversight. Fraud and abuse in healthcare have far-reaching implications on payers, providers, and patients. Therefore, it is crucial to combat fraud and abuse to protect the healthcare system’s integrity.
