Table of Contents
What is Medical Coding?
Medical coding refers to transforming healthcare diagnosis, procedures, medical services, and equipment into universal medical alphanumeric codes. The diagnoses and procedure codes are taken from medical record documentation, such as transcriptions of physicians’ notes, laboratory, and radiologic results.
Medical coding professionals assist in ensuring that the codes are applied correctly during the medical billing process, which is inclusive of abstracting the information from documentation, assignment of the appropriate regulations, and creation of a claim to be paid by insurance carriers.
That documentation serves two purposes it is not only the Patient’s ongoing record; it’s how the healthcare provider gets paid.
Medical codes translate that documentation into standardized codes that tell payers the following:
- Treatments, services, and supplies provided to the Patient
- Patient’s diagnosis
- Medical necessity for treatments, services, or stores the Patient received
- Any unusual circumstances or medical condition that affected those treatments and services
The main task of a Medical Coder is to review clinical statements and assign standard codes using CPT®, ICD-10-CM, and HCPCS Level II classification systems. On the other hand, medical billers process and follow up on claims sent to health insurance companies for reimbursement of services rendered by a healthcare provider. They work with each other to ensure invoices are paid correctly
Why is Medical Coding Needed?
The healthcare revenue stream is founded on the documentation of what was learned, decided, and performed. Documentation is necessary for quality care and in case of future visits and subsequent treatments. It is also more flexible and more accessible with the millions of people in hospitals annually. Medical coding standardizes the language and presentation of all diseases and causes of death to be more easily understood, tracked, and modified.
This common language, mandated by the Health Information Portability and Accountability Act (HIPAA), ensures hospitals, providers, and payers can communicate quickly and efficiently.
Types of Codes Used
Medical coding is performed worldwide, with most countries using the International Classification of Diseases (ICD). ICD is maintained by the World Health Organization and modified by each member country to cater to its individual needs. In the United States, six official HIPAA-mandated code sets are serving different needs.
- APC (Ambulatory Payment Categories)
- CDT® (Code on Dental Procedures and Nomenclature)
- CPT® (Current Procedure Terminology)
- HCPCS Level II (Health Care Procedural Coding System, Level II)
- ICD-10-CM (International Classification of Diseases, 10th Edition, Clinically Modified)
- ICD-10-PCS (International Classification of Diseases, 10th Edition, Procedural Coding System)
- Modifiers
- MS-DRG (Medical Severity Diagnosis Related Groups)
- MS-DRG and APC
- NDC (National Drug Codes)
How is Medical Coding Done?
Medical coders best perform it. Medical coders review a batch of Patient’ notes for coding. The type of records is largely dependent on the facility. Selecting the top patient note or billing sheet on the stack, the coder starts by reviewing the documentation to understand the Patient’s diagnoses assigned and procedures performed on their visit. Coders also abstract other critical information from the documentation, including physician names, dates of operations, and additional information.
Coders rely on ICD-10 and CPT® code books to begin translating the physician’s notes into useful medical codes.