Understanding the Different Medical Coding Systems

Understanding our four main medical coding systems can be challenging. Annual changes, overlapping diagnoses, and the ability to comprehend specific medical terminology causes many billers to assign incorrect codes and hinder the reveue cycle. One major area of frustration is understanding the nuances between various coding systems and applying them correctly to ensure proper documentation, reimbursement, and reporting. 

Understanding the various types of medical coding is essential for anyone involved in healthcare. Codes provide a standardized language to describe diagnoses, medical services, treatments, and procedures. Converting complex medical information into universal codes streamlines documentation and billing processes, as well as, assists in data-driven research.

The 4 Types of Medical Coding Systems

Medical coding classification systems are the backbone of modern healthcare administration, with four different types of medical coding — ICD-10, ICD-11, CPT, and HCPCS. These systems enhance accuracy and efficiency in healthcare but often present challenges to users in terms of ongoing updates and complexity.

Challenges arise during system migrations and transitions to new medical coding systems. Team members must select the correct codes, reference precise procedures and equipment, and update systems frequently. As each system presents its own set of difficulties, it is crucial for professionals to understand modifiers. Partnering with a service provider who understands these nuances will reduce billing issues and delayed payments and increase revenue.

1. ICD-10: Diagnosis and Procedures 

One of the most common frustrations users face in navigating ICD-10 is pinpointing the exact code from a vast range. This task can be overwhelming, especially for complex health conditions. It contains a multitude of codes, each designed to capture specific medical conditions. It replaced ICD-9 in October 2015 to promote greater specificity.

It uses an alphanumeric structure that enables precision but adds a layer of difficulty. For instance, a code for a common condition like pneumonia may be based on its cause, complicating factors, and severity. The code for unspecified pneumonia begins with J18.9 and can evolve into longer, more detailed variations. 

Two distinct components of the ICD-10 system are ICD-10-CM and ICD-10-PCS. ICD-10-CM is primarily used to code patient diagnoses, including diseases, symptoms, and conditions. 

ICD-10-PCS is used exclusively for coding procedures performed in inpatient hospital settings. It focuses on patient interventions and surgeries. These codes follow a seven-character alphanumeric format to detail actions taken by healthcare professionals. For example, 0DTJ0ZZ represents a resection of the appendix with an open approach. Each character describes a different aspect of the procedure, from the body part to the method.

2. ICD-11: The ICD-10 Update

ICD- is the latest version of ICD-10, representing a significant advancement in medical coding. Many countries, including the United States, still use ICD-10 for clinical documentation, health data reporting, and insurance billing. The transition to the new system takes time, so it is essential to stay proficient in ICD-10. It is also necessary to interpret historical medical records with the legacy system. Key features of ICD-11 include:

• User-friendly design: It is designed as a digitally native system. It uses an intuitive web-based platform for more straightforward search functionality to streamline workflows.
• Increased specificity: ICD-11 expands medical codes to offer greater specificity. A diagnosis can now be associated with factors like laterality and severity.
• Modern medical advances: The update now includes updated understandings of mental health conditions and chapters on areas like sexual health and traditional medicine.
• Simplified coding structure: The coding structure is more modular, allowing easier adaptation to different healthcare systems.

3. CPT: Medical Procedures and Services

Current Procedural Terminology (CPT) is the standardized code set and maintained by the American Medical Association (AMA). These five-digit numeric codes document medical, surgical, and diagnostic services performed by healthcare providers. They fall into three categories.

Category I codes are divided into anesthesia, surgery, evaluation, radiology, medicine and pathology. Each code is designated to a particular service. For example, 99213 is the evaluation and management code for an office or other outpatient visit.

Category II codes are optional and used to track performance measures. They focus on preventive measures like controlling blood pressure or smoking cessation. For example, code 3017F can be used to document a patient's screening as part of a quality-tracking initiative.

Category III codes are temporary codes that track emerging procedures and technologies. For example, Category III code 68841 can describe an experimental procedure still to be integrated into standard clinical practice.

The CPT code set also includes proprietary laboratory analyses (PLS) codes to describe proprietary clinical laboratory analyses. It includes Advanced Diagnostic Laboratory Tests (ADLTs) and Clinical Diagnostic Laboratory Tests (CDLTs).

4. HCPCS II: Non-Physician Services

The HCPCS II, or National Codes, identifies and describes medical equipment, medications, procedures, supplies, and services outside of the CPT jurisdiction. It complements the CPT coding system and ensures uniformity in coding medical services across the healthcare industry. For example, the code J1885 represents a ketorolac tromethamine injection, and L33733 is the code for a standard crutch. These include prosthetics, ambulances, and drugs. It is particularly important for Medicaid and Medicare billing. It assists with:

• Documentation: The coding system ensures healthcare providers document and report procedures, medications, and suppliers used in patient care.
• Medical Billing: The HCPCS II codes describe services and items provided to patients on insurance forms. This helps patients secure reimbursements from insurers.
• Tracking: The HCPCS II codes help monitor how medical products, services, and therapies are used, assisting in public health research.

Partner With Global Healthcare Resource for Medical Billing Compliance

Each coding system serves a distinct purpose, and failure to use the appropriate codes leads to claim denials, compliance issues, and revenue loss. Gaining a comprehensive understanding of these systems is crucial for reducing administrative burdens and ensuring patient care is accurately represented in the healthcare continuum. Partnering with a service provider that can offer assistance with revenue cycle and call center management is the first step to success.

Global Healthcare Resource has a proven track record spanning over 20 years in international staffing solutions. We employ over 6,000 call center agents, billing professionals, and HIPPA-compliant coders. Our SOC2 Type 2 compliance and professional team members — well versed in most medical billing software — let us integrate seamlessly with a practice's EHR platform. These resources also help us offer cost-effective, custom solutions to fit each client's unique needs.

Schedule a free consultation to learn more about improving your current medical coding process.

How does a partnership with Global Healthcare Resource work? 

 

Our revenue cycle and patient call center professionals operate as an extension of your team, Here's how it works: 

Step 1: We discuss your scope of work and current challenges.

Step 2: Global assembles, trains and manages a team of highly skilled professionals to work on your project only.

Step 3: In an average of 30 days, your team is fully ramped up and operating at your designated benchmarks and KPIs.