Recent DOJ Findings on Improper Coding: A Wake-Up Call for Healthcare Providers

The Department of Justice (DOJ) has recently released findings revealing a troubling trend in healthcare billing practices: improper coding is more widespread than expected. In 2024 alone, the DOJ identified multiple healthcare organizations that submitted incorrect claims, leading to substantial financial settlements and reputational damage. This development has significant implications for healthcare providers across the country, emphasizing the urgent need to ensure accurate coding and compliance.

Highlights from the DOJ's Recent Investigations

The recent DOJ investigations have uncovered a variety of coding issues that have resulted in financial penalties for healthcare providers. Some of the most common findings include:

• Misclassification of Diagnosis Codes: Many providers have been found to upcode or downcode diagnosis codes to either increase reimbursement or minimize audit risks. This not only violates compliance standards but also distorts patient data, potentially affecting patient outcomes.
• Incorrect Application of Modifiers: The misuse of CPT modifiers continues to be a prevalent issue. Whether used to justify additional billing or unintentionally misapplied, modifier errors often lead to overbilling, triggering audit scrutiny.
• Inaccurate E/M Level Coding: Evaluation and Management (E/M) codes were another area of concern in the DOJ findings. Providers frequently failed to match the correct E/M level with the services provided, resulting in both overbilling and underbilling scenarios.
• Ambiguous Medical Documentation: Many findings pointed to documentation that did not adequately support the level of service billed. When documentation is incomplete or ambiguous, it increases the risk of recoupments during audits and undermines compliance efforts.

Implications for Healthcare Providers

These findings emphasize that improper coding can have serious consequences beyond financial settlements. Healthcare organizations risk losing patient trust, experiencing increased scrutiny from regulatory agencies, and facing potential long-term operational setbacks.

In light of these DOJ findings, healthcare providers must adopt proactive measures to ensure accuracy in coding and documentation. Establishing stringent internal audit processes, investing in coder education, and enhancing clinical documentation practices are critical steps to reduce vulnerabilities and maintain compliance.

How HIA Can Help

Navigating complex coding regulations and maintaining compliance can be overwhelming for many healthcare organizations. At HIA, our coding and auditing services are designed to identify potential issues before they escalate. Our team of certified experts specializes in acute inpatient, outpatient, and professional fee coding support, as well as thorough compliance audits. We help clients validate their coding accuracy, reduce audit risks, and enhance overall revenue cycle performance.

Don’t let improper coding jeopardize your compliance. Reach out today to learn how HIA can strengthen your coding accuracy and protect your organization from costly errors.

Since 1992, HIA has been the leading provider of compliance audits, coding support services and clinical documentation audit services for hospitals, ambulatory surgery centers, physician groups and other healthcare entities. HIA offers PRN support as well as total outsource support.

The information contained in this coding advice is valid at the time of posting. Viewers are encouraged to research subsequent official guidance in the areas associated with the topic as they can change rapidly.