Why Does Medliminal Health Solutions Study Say that Nine Out of Ten Hospital Bills have Errors?

by | Published on Oct 25, 2017 | Medical Billing

Hospital Bills
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About nine out of 10 hospital bills have at least minor mistakes, according to a new study from Medliminal Health Solutions (MHS). This is costing the nation up to $68 billion annually in unnecessary healthcare spending by both patients and physicians. Changing healthcare industry regulations and lack of familiarity with applying new medical codes for reimbursement have been identified as the key reasons for these mistakes. Outsourcing medical billing to a reliable company with trained medical coders and billing specialists is a feasible option for hospitals to stay up-to-date on medical coding changes, modifiers and reimbursement rules. An experienced medical billing company can help providers avoid these common billing errors which the study identified:

  • Duplicate charges: Also known as double billing, duplicate charges occur when a provider attempts to bill the patient twice for a procedure or service. This can happen by billing using an individual code and again as part of a bundled set of tests. Double billing can also occur when the same bill is submitted for reimbursement multiple times when the procedure was performed only once. Patients can spot such errors with an itemized bill.
  • Canceled tests or procedures: The patient may be charged for a service or test that was canceled before it was performed.
  • Incorrect quantity: This mistake occurs if the patient happens to stop taking a particular medication after one dose due to an adverse reaction, but finds multiple doses mentioned on the bill.
  • Incorrect patient information: Errors in entering patient information on the claim such as mistakes in name spellings or insurance ID is common. Even such minor errors can lead to a claim denial by the patient’s health plan. It can also happen that patient’s coverage has changed and the patient is not aware of it. Having an insurance verification specialist check patient information and coverage can prevent these errors.
  • Upcoding: This happens when the hospital submits claims using codes for more serious procedures with higher rates of payment to increase how much they are paid. For instance, a cold could be coded as pneumonia or a brief office visit could be coded as a lengthier one. A test performed by a technician could be coded as one performed by the physician. Upcoding is an illegal, fraudulent practice.
  • Unbundling: There are certain codes that are meant to include a group of procedures commonly done together. For example, a brief examination by the physician prior to a previously scheduled gastrointestinal is included in the endoscopy and is not reported separately. Unbundling occurs when these procedures are coded separately when they should have been bundled. The MHS study found that unbundling is a common cause of claims denials.
  • Balance billing when in network: If the patient is charged by the hospital or physician for amounts outside copayments or coinsurance the insurance company has assigned, this is balance billing. This practice is not justifiable if the care was provided by an in-network hospital or physician. Comparing the medical bill to the health plan’s Explanation of Benefits (EOB) can detect balance billing.
  • Operating room and anesthesia time: Errors in this regard involve billing the patient more time than was actually spent in the operating room or under anesthesia.
  • Price gouging: A study from Johns Hopkins University published in 2016 found extensive price gouging in hospitals. The researchers said that on average, hospitals charged more than 20 times their own costs in 2013 in their CT scan and anesthesiology departments. MHS recommends that patients should check their bills for potential price gouging in items such as alcohol swabs, paper medicine cups, non-sterile gloves, gauze and sanitary napkins. Charges for “miscellaneous” services should also be scrutinized.

Hospitals can eliminate or significantly reduce such billing and coding errors by outsourcing medical billing. In addition to improving patient satisfaction with accuracy in medical bills, outsourcing saves time and money. Medical billing companies scrub claims and ensure that there are no coding errors before they are sent out. This reduces denial risks and speeds up payment.

A reputable medical billing service provider can also ensure that hospitals get timely and accurate medical billing reports so that they have a good idea of the financial aspects of their organization. They can get valuable information such as which insurance companies pay faster and patient services are prone to errors and most likely to be challenged.

In today’s scenario of increased audit scrutiny and fierce competition, there is no room for complacency when it comes to medical billing. Having expertise on board is necessary to build patient trust and stay compliant with evolving healthcare industry regulations.

Meghann Drella

Meghann Drella possesses a profound understanding of ICD-10-CM and CPT requirements and procedures, actively participating in continuing education to stay abreast of any industry changes.

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