Medical Billing Errors: What Small and Mid-Sized Practices Need to Know

Making any errors in your medical practice can be concerning and have wide-reaching effects. But medical billing errors are especially damaging. They can prevent you from receiving reimbursement for services provided, hurt patient trust, and create more work for your billing staff, among other consequences.

Billing errors often arise from a few common problems: coding mistakes, incomplete documentation, and gaps in insurance verification. Adjusting how your practice approaches claims and billing can help minimize errors and streamline your workflows.

Discover the most common errors in medical billing and the key strategies for preventing them.

What are medical billing errors?

Medical billing errors can include any mistakes or inaccuracies in the billing process, such as:

• Incorrect patient information
• Coding errors
• Missing documentation
• Claims submitted to the wrong payer

Such billing errors tend to affect both sides of the transaction. They can delay or reduce reimbursement for the medical practice and create unexpected financial burdens for patients.

Many billing errors arise before the billing department ever submits a claim. Inaccuracies in scheduling, patient intake, or documentation can easily lead to medical billing mistakes, making prevention a responsibility for front desk staff just as much as it is for billing staff.

Why medical billing errors are so detrimental for small and mid-sized practices

Medical billing errors often have a ripple effect that spans far into a medical organization and its patient base. For example, denied and delayed claims directly reduce a practice’s cash flow and increase the administrative burden on staff who must spend time reworking and resubmitting the claim.

Meanwhile, patients who receive unexpected bills due to errors often lose trust in the practice. That trust is much harder to rebuild in a small practice where personal relationships are the backbone of patient retention.

Billing errors also compound over time. Every uncorrected mistake your practice makes adds to the accounts receivable aging balance and increases the likelihood of write-offs. When your practice has high billing error rates, your staff also needs to dedicate more time reworking bills, stealing your time away from proactive patient communication and care.

Understanding the most common medical billing errors

It’s natural to make a medical billing error here and there in your medical practice. No matter how much time you spend double-checking your work, human error is simply a fact of life. However, some types of billing errors are more common than others, and they may be the ones that are plaguing your practice more often than not.

Below are the most common errors in medical billing accuracy impacting healthcare practices like yours.

Incorrect or incomplete patient information

Many billing errors arise from data entry mistakes. Somewhere along the line, a patient’s name, birth date, or member ID was input into your system incorrectly, leading to errors in the billing and claims process.

These errors often originate at check-in and are not caught until the claim comes back rejected weeks after the visit. Your practice can help mitigate this mistake by collecting and verifying patient information at scheduling rather than at check-in, eliminating time pressure that may increase the likelihood of mistakes.

Integrating your practice management tools can also help you reduce errors arising from duplicate data entry. When you create a patient profile in one platform, that same information should automatically transfer to other platforms to ensure consistent spelling and demographic information.

Coding errors

Some medical billing errors occur when the billing team codes the procedure incorrectly. Common issues include:

• Upcoding: Billing for a more expensive procedure than was actually performed
• Undercoding: Billing for a lower-level service than was performed
• Mismatched diagnosis and procedure codes: The use of multiple codes in one claim that don’t point to the same issue

Unfortunately, coding errors can do more than just waste time. They can also trigger payer audits and lead to compliance concerns.

Good coding practices rely on accurate and comprehensive clinical documentation, which means that inaccurate coding can arise from multiple departments and require a closer look to trace.

Missing or expired prior authorization leading to claim denials

Prior authorization is necessary under many insurance plans for certain services, procedures, medications, or imaging appointments. This means that you may need to seek authorization from the insurance company prior to the visit. 

Overlooking prior authorization requirements can lead to immediate claim denials and unexpected patient bills. However, in the busy day-to-day routine of your medical practice, it’s easy to forget this task until a patient shows up for their appointment.

Your practice needs reliable procedures for conducting prior authorization before the visit. Build this process into every pre-visit workflow to ensure that auth requirements are flagged and resolved before the provider delivers care.

Duplicate billing and unbundling

Duplicate billing and unbundling are other examples of errors that can pose compliance risks. The former occurs when the same service is billed more than once, often due to lack of coordination between staff or system errors. The latter refers to billing separately for services that should be billed together, resulting in overpayment.

These issues can lead to audits and break trust with patients. When a patient learns that they have been billed twice for the same service or have been upcharged, they may start to question your practice’s future billing processes. Even if these errors were truly accidental, they present a risk to patients who may not catch them before making the extra payment.

Both errors are preventable with clear billing procedures and regular audits. If this is a recurring issue in your practice, you can also consider implementing billing software that flags duplicate submissions and other potential mistakes. It’s worth exploring solutions to reduce your practice’s liability risks.

Key benefits of reducing medical billing errors

Medical billing errors may seem like small problems, but they can escalate into major concerns for your practice. They have the potential to destroy patient trust, cost you significant amounts of time and money to resolve, and even bring your compliance into question.

By taking the time to find the source of billing errors and reduce them, your practice stands to gain these benefits:

• Faster reimbursement: Even in the best-case scenarios, billing errors can delay reimbursement. Preventing this issue altogether helps you reduce denied claims and rejections, allowing you to maintain a lower AR balance.
• More time for proactive patient engagement: When staff members are tied up with resolving billing errors and claim denials, they often don’t have much time to spend on in-person patient communications and other valuable processes. Mitigating errors frees up time for processes like scheduling and care coordination to help your practice run more smoothly overall.
• More satisfied patients: Medical billing errors can hurt patient trust and loyalty. By reducing errors and ensuring accurate information on bills, you instill confidence that encourages patients to return for future care and refer others to the practice. You also increase the likelihood of patients paying their bills on time.
• Lower compliance risks: A lower billing error rate reduces the risk of compliance issues and audits, building a more predictable revenue cycle over time.

If you want to streamline your reimbursement process and improve patient satisfaction, taking steps to reduce billing errors is key.

How medical billing errors connect to patient communication

You may see billing errors as internal problems that your practice needs to solve for its own revenue cycle management process. But billing problems directly correlate to your patient communication strategy. Knowing how to communicate about billing is just as important as ensuring the accuracy of bills.

Patients who receive unexpected bills, even when they are accurate and correct, often form a negative impression of your practice. They may experience confusion or frustration that damages their relationship with your healthcare providers.

When you improve the way you communicate about bills, you can reduce these feelings and create a more predictable reimbursement process. Weave’s communication platform is an example of a tool you can use to enhance billing communications while saving your practice time.

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Weave makes it easy to send pre-visit cost estimates through digital channels and automatically deliver post-visit billing summaries after finalizing bills. You can also use Weave to automate payment reminders and set clear expectations before a bill ever arrives.

With Weave’s two-way texting tools, your billing staff can quickly answer patient questions about charges and mitigate confusion before it escalates. This can help reduce the number of billing disputes that take time to resolve.

Finally, investing in a tool that connects billing communication to patients’ preferred channels, like text, email, and phone, helps reduce friction that causes patients to delay payment or disengage from the practice.

Best practices for reducing medical billing errors

Your practice likely doesn’t mean to make billing errors, and they may seem inevitable. Human error will always be a problem, but implementing the following best practices can help you prevent or catch these issues before they escalate into bigger, more time-consuming problems.

• Verify information before the visit: Taking the time to verify patient insurance information and prior authorization status before every visit is a critical step to prevent a significant number of billing errors. Perhaps you implement a procedure to complete pre-visit verification as soon as a patient creates an appointment, or set reminders to perform it one week before the appointment date.
• Create a pre-claim review process: Double-checking billing information is another important step in minimizing errors. Consider creating a pre-claim review process that checks for coding accuracy and complete documentation before submitting claims.
• Conduct regular billing audits: Performing internal audits periodically is an excellent way to identify error patterns and systemic issues before they worsen.
• Automate steps where appropriate: Implementing automations is sometimes a good way to minimize human error. You can explore tools that automate eligibility verification, patient communication, and claim scrubbing to reduce manual error rates and accelerate the entire billing process.

What to look for in a billing error prevention solution

Leveraging the right technology in your medical practice can also help you reduce the frequency of billing errors. However, it’s important to take the time to find the best solution for your practice’s needs.

When evaluating billing error prevention solutions, be sure to look for these core capabilities:

• Automated eligibility checks
• Claim scrubbing
• Prior authorization tracking
• Integration with electronic health records (EHR) and practice management systems

Prioritize solutions that highlight billing and coding errors before submission rather than flagging them after a claim denial. Also look for tools that can connect billing features to patient communication platforms so that you can maintain consistent, timely patient-facing communication throughout the billing process.

The goal is to implement an error management solution that helps you proactively prevent errors rather than reactively responding to them. Your solution should help you build workflows that catch mistakes before submission.

How Weave helps practices manage the patient side of medical billing errors

Weave’s communication platform helps small and mid-sized practices like yours prevent medical billing errors and enhance patient engagement, all while saving time on a range of administrative tasks. Weave enables practices to send automated pre-visit cost estimates and insurance confirmation messages to reduce confusion and misunderstandings from the get-go.

Meanwhile, Weave’s two-way texting features allow staff to collect accurate insurance information and quickly confirm coverage details without tying up phone lines. Patients can quickly ask billing questions before and after their visits and receive prompt responses to further minimize confusion.

Weave integrates seamlessly with electronic health records and billing systems for a cohesive workflow. You can feel confident that all of your integrated platforms will pull information from the same source and maintain accurate, up-to-date details to minimize errors like double billing.

Proactive billing communication with Weave reduces patient disputes, accelerates payment, and protects the patient relationship even when the occasional billing issue arises.

Ready to improve your billing and patient communication workflows?

Medical billing errors are a common problem throughout the healthcare industry, but they are largely preventable with the right tools and processes. The practices with the lowest error rates are those that consistently perform pre-visit verification, have clean documentation workflows, and proactively communicate with patients before and after appointments.

Auditing your current medical billing error rates and patient communication workflows is a good first step toward a more predictable revenue cycle. With Weave, managing patient communications becomes faster and easier.

Weave helps practices reduce billing confusion, automate patient communications, and improve the overall patient experience from scheduling through payment. Request a demo to see how Weave supports practices like yours.

Want to see
more about
Weave?
1 System for Phones, Texting, Payments, & More
 Access a full suite of patient communication tools with Weave! Texting, payments, reviews, & scheduling in one place. Get started today!
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