Do Electronic Health Records Encourage Upcoding?

Electronic health records are being increasingly used, replacing their more cumbersome paper counterparts with a system of added convenient and efficiency. In fact, Congress has passed legislation in the last five years that provides incentives to encourage healthcare providers to favor the use of electronic health records. Starting in 2015 certain doctors who do not begin the transfer to using these will face penalties.

However with the increased convenience electronic health records afford, does this also mean upcoding – the practice of coding and billing for procedures that were not performed, or billing and coding for an exaggerated level of medical care – will also become a more convenient practice?

Two 2012 studies, one by the New York Times and the other by the Center for Public Integrity, make the case that this in fact may be the case. They point to the fact that Medicare statistics from 2010 show hospitals made $1 billion more in Medicare charges than they did in 2005, in large part thanks to the ways they changed their billing and coding.

Other Explanations

One of the first responses healthcare providers retort is that electronic health records make it easier to bill for all services provided, and in fact allow for a more accurate billing; up until this point potential charges were getting lost in the paperwork of a patient’s healthcare record, doctor’s notes, and a system for billing and coding that was not streamlined. They also point out that the two 2012 studies focused on emergency room visits, which may have been more expensive for Medicare because of the increasing trend to go to the ER in lieu of a family doctor or personal physician; in other words that correlation does not necessarily equal causation.

A recent administrator of the Centers for Medicare and Medicaid Services (CMS) – the agency in charge of the Medicare program – believes that the increase in Medicare spending is not primarily due to fraud such as upcoding, but rather to healthcare providers like hospitals figuring out the loopholes of Medicare and working through these legal channels to boost their profits.

And in fact upcoding is not always a blatant disregard for morality. The language used to describe the seriousness of medical procedures, which subsequently affects the rate of reimbursement by Medicare, can be interpreted to be ambiguous. If no red flags are raised or warnings issued then a medical billing and coding professional who may have been uncertain about a possible instance of upcoding will have his or her more expensive interpretation reaffirmed. CMS could remedy this cause by making clearer definitions and enforcing these.

Another possible culprit for the increase in cost may be the coding system itself. Medical billing and coding professionals who work in a hospital setting will be familiar with the Current Procedural Terminology (CPT), the set of medical codes that Medicare uses. Critics point to the fact that this set of codes was developed with doctors in mind and was not intended to be so widely used in a hospital setting. What may be a justified larger expense in a physician’s office or clinic may be more routine in a hospital, however there is currently not a CPT code to distinguish many of these types of services.

With many players involved who all have compelling arguments, the answer to the electronic-health-records-encouraging-upcoding question is a matter of debate, to which medical billing and coding professionals would do well to pay attention.