Medical coders who work in the inpatient hospital setting utilize a different skill set than medical coders in other healthcare settings. The rules that govern medical billing and medical coding in hospitals require that a specific skill set be practiced that is different from those used by other professional medical coders and professional medical billers. Because the financial transactions that result from the decisions that inpatient hospital coders make have a greater monetary amount than outpatient professional coders, hospital medical coders need additional training and experience to be at the top of their field.

Because the amount of money involved in each inpatient hospital claim is so much greater than claims in an outpatient setting, inpatient hospitals are subjected to greater scrutiny for accuracy of the codes reported for appropriate reimbursement. When a medical coder translates a routine follow-up visit to a doctor into code for a patient covered by Medicare Part B, the dollar amount for an average office visit is reimbursable at an average rate of about sixty dollars, according to the published Medicare Part B fee schedule. An equivalent, average inpatient stay can cost several thousand dollars, depending on the patient’s condition.

Because of the amount of money involved in inpatient reimbursement for healthcare services, audits of medical records by third-party payers is more frequent in the inpatient environment. Recovery efforts to detect fraud and abuse tend to focus on high-dollar claims, and both government healthcare programs and commercial healthcare insurers monitor inpatient claims more closely for this reason.

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Hospitals Hire Quality Candidates

Medical coding in the inpatient setting falls under the field of Health Information Management (HIM). The coding departments of large hospitals fall under the larger scope of an HIM department. This makes sense, since medical coders are in the business of translating the information contained in a patient’s medical record into the language of universally standardized medical code. With legal and contractual obligations in effect to ensure correct healthcare claim submission, hospitals look for candidates who have successfully completed a formal education program to fill open positions in the coding department.

Many hospital coding positions require that a candidate possess professional credentials. They can be Certified Professional Coders-Hospital Outpatient (CPC-Hs) through the American Academy of Professional Coders (AAPC), or they can be Certified Coding Specialists (CCSs) though the American Health Information Management Association (AHIMA). Other professional bodies offer professional coding credentials, but these two bodies offer the most common credentials that employers seek.

In order to obtain these credentials, professional medical coders must pass a written examination to earn the privilege of putting these initials after their names. The examinations cover a gamut of coding and legal issues that professional medical coders are likely to encounter in the field. In addition, after passing the written exam, certified coders must complete Continuing Educational Units every year to prove that they remain conversant in the many issues and changes that effect healthcare reimbursement on an ongoing basis.

Many inpatient hospital coders possess a bachelor’s degree in HIM. While this may not be required for every position, more and more, hospitals require a bachelor’s degree or, at least, equivalent experience. Without adequate formal training, entering the rarified and well-paid world of hospital coding is difficult, at best.

Education Through Experience

While it is possible to get a masters’ degree in HIM, the truth is that this is usually reserved for management positions. After completing a program of study and obtaining certification as a professional, medical coders in the inpatient environment learn on the specific of a particular specialty on the job. Every hospital has systems and protocols in place to assign appropriate codes to describe provided services.

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Each hospital also has established documentation standards that are required to be met for services to be billed accurately. Because third-party payers are active in preventing fraud and abuse of the healthcare reimbursement system, and because inpatient services are billed correctly. Professional medical coders are familiar with the ins and outs of federal regulations and commercial payers’ requirements due to their schoolroom training. Once in the field, they become familiar with how each hospital’s compliance department implements these requirements on a specific, case-by-case, basis. Through practice, inpatient medical coders become proficient in the many details that go into reporting medical information.

Other Coding Roles in the Inpatient Setting

The majority of inpatient medical coders work actively with patients’ medical records and the software designed to assign codes. Once they have proven their mastery of the system, there are opportunities for advancement. The next rung up the career ladder is for talented medical coders to enter a hospital’s compliance department, which is usually separate from the HIM department.

Medical coding and billing compliance consists of monitoring how and when codes are assigned. Compliance coders audit individual medical records for coding accuracy. The nature of an internal audit can be focused on one provider or service, or it can be a general audit in which medical claims are randomly selected over a wide range of specialities. Codes are compared to the available documentation. The purpose of these audits is not only to insure correct billing practices, but also to improve documentation on an institutional level. Compliance auditors report their findings to individual healthcare providers and department heads.

When deficiencies are uncovered, compliance auditors conduct educational sessions with healthcare providers to explain an organization’s documentation standards, and to expand a provider’s knowledge of relevant, universal coding rules.

Healthcare providers are trained to deliver medically necessary services. While they receive training in proper documentation, they rarely receive training in coding, aside from the outreach of a hospital compliance program. Healthcare providers rely on professional medical coders to be aware of the many issues involved, and to keep them abreast of changes in the industry. Accurate coding reflects the quality of available documentation, just as the quality of the documentation may reflect the quality of the care being provided.

Coding compliance audits can also be used to track the utilization of services within a healthcare facility. If certain codes are used infrequently, this will indicate that the services the codes describe, while available, may not be appropriate to a given patient population. By tracking code usage, a hospital’s finance and medical departments can conduct a cost-benefit analysis to determine if a service is vital to the hospital’s mission, or if it should be discontinued, or if it should be moved to another location. Likewise, a surge in code usage can indicate a need to expand a particular segment of the hospital’s activity to meet demand.

Because of the granularity of data represented by medical codes, they can be used for much more than reimbursement for services. This is why accurate code assignment is essential to the successful performance of a medical coder’s job. Inpatient medical coders who excel in the basics of their profession are prime candidates for promotion into hospital operations that involve more than just reimbursement issues. Since coding compliance is a discipline that performs oversight of day-to-day operations, compliance coders are usually considered to be filling a managerial-level position. The pay is generally higher than that earned by coders who do the routine work, and the positions they hold are reimbursed on a salary, rather than an hourly basis.