5 Common ICD-10 Coding Errors That Can Cost You Big

Have you ever submitted a medical claim, only to have it denied or rejected? It happens more often than you think. The reason? Coding mistakes. Even small errors in ICD-10 coding can lead to financial losses, delays in payment, and compliance issues.

Whether you work as a medical coder, a billing specialist, or a healthcare provider, getting the codes right is crucial. If mistakes happen too often, it can impact a hospital or clinic’s revenue and even put them at risk for audits or penalties.

Let’s go over five common ICD-10 coding mistakes that can cost you more than just time—and how to avoid them.

1. Picking the Wrong Code

ICD-10 codes cover thousands of conditions, injuries, and diseases. With so many options, choosing the wrong code is a common mistake. This happens when a coder misreads a diagnosis, selects a similar-sounding code, or uses an outdated reference.

Why It Matters

• Wrong codes lead to claim denials.
• Some errors cause underpayment, which means the provider gets paid less than they should.
• Repeated mistakes can lead to an audit, where insurers check for incorrect billing patterns.

Example

A doctor diagnoses a patient with Type 2 diabetes with kidney disease, but the coder mistakenly selects the general diabetes code (E11.9) instead of the specific one (E11.22 for diabetes with kidney disease). The insurance company may reject the claim, asking for more details.

How to Avoid It

• Double-check the diagnosis before selecting a code.
• Use updated coding books and software.
• If unsure, ask a senior coder or supervisor.

2. Using Unspecified Codes Too Often

ICD-10 is designed to be highly specific. Many coders, especially beginners, make the mistake of choosing “unspecified” codes when a more detailed one is available. Insurance companies often see this as incomplete documentation.

Why It Matters

• Unspecified codes can lead to claim denials.
• Insurance providers may request additional documentation, delaying payments.
• In some cases, using a general code when a specific one exists may be considered incorrect billing.

Example

A patient comes in with pneumonia. Instead of specifying whether it is bacterial pneumonia (J15.9) or viral pneumonia (J12.9), the coder selects J18.9 (unspecified pneumonia). The claim may not get paid because the insurer needs more details.

How to Avoid It

• Check if a more detailed code is available.
• Encourage doctors to provide more specific diagnoses.
• Avoid relying on “unspecified” codes unless absolutely necessary.

3. Not Using Combination Codes

ICD-10 includes many combination codes, which cover two or more conditions in one entry. Some coders make the mistake of using separate codes instead of the correct combination code. This can cause confusion, incorrect billing, and even claim rejections.

Why It Matters

• Combination codes ensure accuracy in medical records.
• Using separate codes when a combination exists can lead to overpayment or underpayment.
• Mistakes in coding chronic conditions can lead to compliance risks.

Example

A patient is diagnosed with hypertension with chronic kidney disease. Instead of using I12.0 (hypertensive chronic kidney disease, stage 5), the coder assigns separate codes for hypertension (I10) and chronic kidney disease (N18.5). This can result in claim errors.

How to Avoid It

• Check if a combination code is available before assigning separate codes.
• Use official ICD-10 guidelines for chronic conditions.
• Cross-check codes with coding manuals or electronic tools.

4. Upcoding and Downcoding Errors

Upcoding happens when a diagnosis or procedure is coded as more severe than it actually is. Downcoding happens when a coder selects a less severe code, leading to lower reimbursement. Both mistakes can cause issues.

Why It Matters

• Upcoding can lead to legal trouble, as it may be seen as fraud.
• Downcoding means the provider gets paid less than they should.
• Insurance companies closely monitor these patterns and may conduct audits if they detect frequent errors.

Example

A doctor treats a minor sprained ankle, but the coder selects a fracture code instead of the correct sprain code. This may cause an overpayment, and if caught in an audit, the provider might have to repay the extra amount.

How to Avoid It

• Always match the code to the documentation.
• Never guess or assume a more serious diagnosis.
• If a diagnosis is unclear, ask the physician for clarification.

5. Ignoring Annual ICD-10 Updates

ICD-10 codes are updated every year. New codes are added, old ones are removed, and some guidelines change. Coders who don’t keep up with these updates risk using outdated codes, which can lead to claim denials.

Why It Matters

• Using outdated codes can lead to rejected claims.
• Some codes are deleted and replaced with new ones.
• Insurance providers may not recognize old codes, leading to payment delays.

Example

In 2023, ICD-10 updated mental health codes to be more specific. If a coder still uses the old depression code (F32.9) instead of the updated one, the claim might get rejected.

How to Avoid It

• Stay updated with official ICD-10 changes each year.
• Attend coding refresher courses or webinars.
• Use current coding books and software.

How to Improve ICD-10 Coding Accuracy

Even experienced coders make mistakes. The key to reducing errors is continuous learning and paying attention to details. Here are some tips to improve accuracy:

• Review the diagnosis carefully – Always check the doctor’s notes before selecting a code.
• Use coding software – Many tools can help catch common mistakes.
• Stay updated – ICD-10 codes change every year, so take refresher courses when possible.
• Ask questions – If something is unclear, consult a supervisor or coding expert.
• Double-check claims – Before submitting, do a final review to catch errors.

Final Thoughts

ICD-10 coding is important for healthcare billing and patient records. Mistakes can lead to claim denials, lost payments, and compliance issues. Learning to avoid common errors can help medical coders and healthcare professionals work more accurately and efficiently.

Want to improve your ICD-10 coding skills? KnowledgeConnex has easy-to-follow online courses that can help you stay updated. Whether you need to learn new coding rules, avoid common mistakes, or get better at medical billing, these courses can help.

Check out the courses today and build your coding skills with KnowledgeConnex!