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Medical Billing Mistakes: Common Points of Failure and Helpful Solutions

April 24, 2018

Medical billing errorsAccording to Medical Economics, 80% of medical bills contain mistakes, and plenty of coding mistakes happen, despite the increased use of automation in billing and coding today. Billions of dollars are lost each year due to medical billing mistakes, and mistakes result in a loss of reimbursement, which means your practice is losing revenue. Unfortunately, it’s smaller facilities and practices where little mistakes are often overlooked, which results in underpaid or unpaid claims, damaging their overall financial picture. 

One of the best things your practice can do to deal with costly medical billing mistakes is to look at the most common points of failure and find solutions that help prevent mistakes in the future.  Here’s a look at some of the most common points of failure for billing and coding, as well as some actions that can be taken to solve these problems.

Pre-Service Failures 

Many billing, coding, and documentation mistakes actually begin pre-service. Pre-service failures can include: 

  • Failure to get prior authorization for services 
  • Inaccurate coverage/insurance information
  • Incorrect contact information
  • Incorrect demographic data 


Solutions to pre-service failures include: 

  • Collecting co-insurance, past due balances, and co-payments before or at the time of service. Good communication with patients and ensuring you have complete and accurate information from them can help. 
  • Staff members need to pay attention to small details, including correct data entry, entering data into the correct fields, document scanning, and collecting all information that’s required from patients. 
  • Leveraging your practice management system can help, which involves finding external plugins and tools to improve performance, conducting routine training for staff, and upgrading your system when needed.
  • A solid patient registration process is one of the best ways to avoid pre-service failures. This starts with front desk employees that are well-versed and well-trained in patient payment methods and insurance eligibility. Front desk employees should be checking patient eligibility before the patient encounter, and simply doing this can make a big impact on revenue. 
  • Making patients aware of their financial obligations can also help. Setting expectations up front and informing patients of their financial responsibilities can boost cash flow and reduce time working to get payments later. 
  • Contacting patients pre-admission can help avoid confusion about information on insurance coverage and eligibility.

Encounter Failures 

Multiple failures often occur during the patient encounter, and these failures can be very costly. Common encounter failures include: 

  • Incomplete documentation
  • Inaccurate coding
  • Failing to report all the services that were provided during the encounter
  • Reporting the incorrect level of evaluation and management service 
  • Lack of communication between providers and the billing department 


Solutions to failures that occur during the patient encounter include: 

  • Double checking coding for accuracy, whether you use manual or automated coding. Downcoding and upcoding both need to be addressed in staff training. 
  • Consistent, proper communication between clinicians and the administrative, billing, and coding staff. 
  • Continually training staff members and supplying them with quick reference materials, such as the helpful “Pocket Card.” 
  • Ensuring that physicians are well-versed in coding and lead the rest of the staff by example. 

Billing Failures 

The biggest failure in billing is the improper use of modifiers. For example, modifier -25 is both underused and overused because many people are unsure of the proper way to use it. “X” modifiers and the -59 modifier are often misused and overused. Unfortunately, these mistakes can be costly. 


Solutions to the improper use of modifiers include: 

  • Understanding requirements that are payer-specific when using modifiers.
  • Having accurate, updated, practice-wide training and policies that promote the consistent use of modifiers and ensuring that staff understands the proper use of modifiers.
  • Continuing education for billing staff. 

Follow-Up Failures 

One of the biggest points of failure is a follow-up. In many cases, practices never follow up on denials, which results in a huge loss of revenue. In many cases, claims denials occur because of simple mistakes and when corrected, providers can get paid for their services. 


Key solutions for follow-up failures include: 

  • Taking time to do an audit on denials to find out why denials are happening. Coding audits are one of the best cost-saving tools for practices. Many healthcare practices have a 5-10% denial rate, which results in a huge amount of lost revenue. Auditing denials and doing coding audits on productivity and accuracy can help to eliminate wrong codes, lack of documentation errors, and underpayments. 
  • Never assume that the payer is correct when they deny a claim. 
  • Look at denials and correct any mistakes. Then resubmit for payment. 
  • Avoid falling behind on claims follow-up. It’s important to follow up in a timely manner if you want to get paid. 
  • If a practice doesn’t have the time, knowledge, or staff members needed to deal with regular denials, outsourcing to a billing and coding company often proves helpful. Many underpaid and unpaid claims can be identified, fixed, resubmitted, and then collected, boosting revenue for the practice. 

Fast, error-free billing and coding are important, and making mistakes in these areas can prove very costly for your practice. Outsourcing your billing and coding to experts in billing and coding can improve cash flow long-term. M-Scribe offers billing and coding services, working with you to make sure you’re not losing money in unpaid claims and helping you avoid mistakes that cost your practice. Contact us today and learn more about how M-Scribe Medical Billing, LLC can help you reduce costly mistakes and improve your bottom line.  


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