Medical Coding Slip at TX Hospital Led to COVID-19 Billing Error

Midland Memorial Hospital agreed to pay over $555,000 for a medical coding error that resulted in claims being sent out for reimbursement from the government even though patients did not have a primary COVID-19 diagnosis.

The Texas hospital told local news source News West9 that it miscoded 87 claims last November and sent those claims to the Health Resources and Services Administration (HRSA) for reimbursement. HRSA reimburses providers for treating uninsured patients with COVID-19.

However, those uninsured patients did not have the virus, at least as their primary diagnosis, the hospital admitted to the Office of Inspector General (OIG) this summer. OIG published a report in late August detailing the hospital’s self-disclosed conduct. The government watchdog said Midland Memorial Hospital agreed to pay $555,141.72 for “allegedly violating the Civil Monetary Penalties Law,” after submitting the claims to HRSA.

“The way that HRSA wanted us to code COVID-positive [self-paid] patients was different than what we would've done for anyone else,” Samuel Moore, Midland Memorial Hospital vice president and CFO, told News West9.

Midland Memorial Hospital discovered the medical coding error a few months after submitting claims to HRSA. To rectify the medical coding error, hospital leadership used a third-party billing auditor to review all of its COVID-19 claims. They also made changes to revenue cycle management processes when it comes to uninsured COVID-19 claims.

“Those can be carefully scrutinized now by the leadership in our revenue cycle and departments so that we're having multiple different eyes on the coding and making sure that they're accurately coded before those bills go out,” Midland Memorial Hospital CEO Russell Meyers said publicly.

The hospital also still uses the third-party billing auditor to ensure proper medical coding and billing for COVID-19 cases, the news report stated.

Medical coding and billing requirements for special COVID-19 cases have confused healthcare providers from the start. A survey conducted in August 2020 found that increase in workloads due to confusion over codes and requirements for coronavirus-related claims impacted revenue cycle operations.

“COVID definitely disrupted our processes,” Ginna Evans, MBA, RHIA, CPC, CRC, FAHIMA, coding educator for IM specialties at Emory Healthcare, said at Xtelligent Healthcare Media’s Reimbursement Virtual Summit earlier this year.

The new and evolving requirements for COVID-19 cases forced hospitals to create new workflows for medical coding and billing to ensure claims were being sent out for reimbursement. However, incorporating new workflows and doing so quickly reduced revenue cycle efficiency for some hospitals.

At LMH Health in Kansas, for example, the two-dose nature of the most popular COVID-19 vaccines challenged the hospital’s medical coding and billing processes, prompting hospital leaders to rethink its whole strategy for COVID-19 coding.

“At the time, we were only planning having to code [vaccinations] at one time,” Amber Epperson, director of health information management services and the physician central business office, told RevCycleIntelligence earlier this year. “But we were also thinking through with the revenue cycle team how we could increase our efficiency while still coding the rest of the accounts coming in for the inpatients being seen for COVID-19 and other things. We went to our patient accounts team because we know they have certain rules that they have built in their system for claim edits and things of that nature.”

The American Medical Association (AMA) has since incorporated COVID-19 codes into its widely-used Current Procedural Terminology (CPT) code set. It will continue to release new codes for clinical documentation and billing as new developments in the fight against COVID-19 continue.