Introduction
Despite Medicare requiring accurate documentation and coding for decades, healthcare providers continue to undercode services at alarming rates. This white paper examines the undercoding crisis contributing to Medicare’s $31.7 billion annual improper payments: conservative coding practices, documentation burden, fear-based billing, lack of audit programs, and insufficient education that make accurate revenue capture difficult for organizations.
Key Takeaways
- 42% of E/M claims were incorrectly coded in OIG studies
- Undercoding creates compliance risks, not just revenue loss
- Conservative coding to avoid audits can trigger CMS scrutiny
- Documentation burden contributes to missed billing opportunities
- Risk-adjusted models require accurate coding for reimbursement
- Regular coding audits are essential for compliance programs
- Updated E/M guidelines reduced the administrative burden since 2021