The following is a guest blog post by Bill Wagner, CHPS, Chief Operating Officer, KIWI-TEK.
In January 2015 the ICD-10-preparation frenzy was at its peak. Healthcare provider organizations were scrambling to find coding support during the implementation and transition phases of the quickly approaching ICD-10 implementation deadline. KIWI-TEK was one of those outsourced coding companies being asked to supply experienced, qualified coders.
KIWI-TEK was valiantly trying to keep up with the burgeoning client requests for coding support. And although they had been actively recruiting for months, their coding bench was empty. For the first time in company history, KIWI-TEK decided to augment their team with additional coding resources by contracting with several offshore coding services.
By April 2016, the crunch for additional coding support was all but over. However, the appeal of lower coding costs via offshore coding support drives many healthcare executives to contract with international outsourced coding support. Interest in offshore coding remains even to this day as evidenced by Partners Healthcare recent decision to outsource medical record coding to India.
But what about coding accuracy? This question remains and HIM Directors deserve a data-driven answer.
Until now, the only information available for providers to compare outsourced domestic coding quality with offshore coding performance was anecdotal. Specific quality data had not been produced or shared. Amidst rampant questions and red flags, KIWI-TEK partnered with six hospitals and health systems to answer the coding industry’s toughest question: “Who delivers higher coding accuracy, domestic or offshore outsourced coding services?” (Be sure to check out the full study results for a more detailed answer to this question).
Each of the six participants had experience with both domestic and offshore coders for at least one year. The same onboarding, auditing, and training procedures were applied equally to all.
Code Accuracy Lower with Offshore
Across all six organizations, code accuracy was lower for the outsourced offshore coding service versus the domestic coding companies by an average of 6.5 percentage points.
Poor coding quality also increased payer denials with additional management time required to onboard, train and audit the outsourced offshore coders.
And What About the Cost?
The final results showed that, despite what seems to be a much lower hourly rate for offshore coders, the total cost is much higher when all factors are taken into consideration. These factors include:
Auditing – Offshore coders required an average of 6 more hours per coder per month of auditing due to poor accuracy results.
Denied claims – Offshore coders averaged 10 more denied claims on Inpatient and Same Day Surgery encounters per week than domestic coders. Reworking of denied claims on these patient types takes 40 minutes for each claim.
The Final Answer
Yes, there is a difference. Offshore coding is less accurate, and in the long-term, may also be more expensive.
To read detailed findings of the study, download the KIWI-TEK White Paper entitled “Is Offshore Coding Really Saving You Money”.
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