Medical coding isn’t just a back-office task — it’s the financial heartbeat of your healthcare practice. Every CPT or ICD-10 code directly impacts how much, and how quickly, you get paid. Yet, according to the American Medical Association (AMA), up to 80% of medical claims contain errors, leading to billions in lost reimbursements and unnecessary compliance risk every year.

If your revenue cycle feels slow, denials are climbing, or audits seem never-ending, the culprit may be hidden in your coding. This guide breaks down the top 10 medical coding mistakes that cost practices like yours thousands of dollars — and, more importantly, how to fix them.

(If you’re new to coding concepts, start with our earlier article: What Are CPT Codes? A Complete Beginner’s Guide for Medical Billing for the basics.)

1. Using Outdated or Non-Specific Codes

One of the most common and costly errors healthcare practices face is using outdated or vague codes. The ICD-10 and CPT code sets are updated every year, and even a small oversight can lead to claim denials or underpayment.

Why it happens

• Coders or clinicians rely on old templates or EHR shortcuts.
• Payers update requirements without notifying providers.
• Practices fail to implement annual code updates promptly.

The impact

• Denied or delayed claims due to “code not recognized” errors.
• Reduced reimbursements when unspecified codes (like “unspecified injury”) are used.
• Compliance exposure for failing to follow current standards.

How to fix it

• Schedule quarterly code reviews. Don’t wait until the annual ICD update; verify code accuracy throughout the year.
• Use EHR alerts. Many systems can flag deprecated codes before claim submission.
• Train your team. Make sure coders, clinicians, and billing staff all understand new or revised codes.

Keeping up with updates doesn’t just prevent denials — it also ensures your claims accurately reflect the services you provide, protecting both revenue and compliance.

2. Incorrect or Missing Modifiers

Modifiers are small two-digit additions to CPT codes that make a big difference. They tell payers whether procedures were distinct, repeated, or performed by multiple providers. When used incorrectly (or not at all), your reimbursement can be cut in half — or denied entirely.

Common examples

• Failing to use modifier 25 when a significant, separately identifiable E/M service is performed on the same day.
• Incorrectly applying modifier 59 when services are not truly distinct.
• Forgetting modifier 26 or TC to differentiate professional from technical components.

The impact

• Payers automatically bundle services, resulting in partial payment.
• Claims are flagged for possible upcoding or duplication.
• Audits triggered by modifier misuse.

How to fix it

• Create an internal “modifier map.” Keep a quick-reference list of common modifiers used by your specialty.
• Review payer policies. Some insurers interpret modifiers differently — consistency is key.
• Audit modifier usage. Run monthly reports to identify patterns or potential errors.

(For a deeper look at coding compliance and audit prevention, see our post: How Accurate Medical Coding Reduces Compliance Risks and Audit Penalties.)

3. Incomplete or Inaccurate Documentation

Even the best coder can’t submit accurate claims without proper documentation. Missing or incomplete notes are one of the leading causes of claim rejections and compliance penalties.

Why it happens

• Clinicians are rushed, omitting key details in the encounter note.
• EHR templates don’t prompt for all billable services.
• Lack of standardized documentation processes.

The impact

• Reduced coding accuracy — especially for Evaluation & Management (E/M) services.
• Delayed payments due to “insufficient documentation” denials.
• Increased audit risk and potential clawbacks.

How to fix it

• Implement standardized documentation templates. Include fields for all relevant CPT elements (time, complexity, medical decision-making).
• Encourage coder–clinician collaboration. Weekly meetings between providers and coders improve clarity and reduce errors.
• Use real-time documentation audits. Identify missing elements before claims go out.

Accurate documentation doesn’t just ensure proper reimbursement — it also tells the clinical story that justifies every code.

4. Upcoding or Undercoding Services

Both upcoding and undercoding create serious problems. Upcoding — billing for a higher level of service than provided — risks penalties and audits. Undercoding — billing for less than what was performed — leaves money on the table and distorts data on patient complexity.

Why it happens

• Misunderstanding E/M guidelines or time-based coding.
• Clinicians err on the side of caution to avoid audits.
• Copy-and-paste habits in EHRs create inconsistent records.

The impact

• Upcoding = potential fraud allegations, payback demands, and fines.
• Undercoding = lost revenue and inaccurate productivity data.

How to fix it

• Train staff on E/M level selection. Use examples and payer-specific guides.
• Conduct quarterly internal audits. Compare documentation with billed levels.
• Implement compliance software. Tools can flag patterns of upcoding or undercoding automatically.

Transparency and education are your best defenses — ensure everyone understands how documentation supports coding decisions.

5. Unbundling or Incorrectly Bundling Procedures

Bundling errors are among the top reasons claims are denied. Unbundling occurs when services that should be billed together are submitted separately, while over-bundling means missing out on legitimate payments.

Example

A surgeon bills separately for pre- and post-operative visits that are already included in the surgical package — a classic unbundling error.

The impact

• Denials or payer recoupments for incorrect billing.
• Loss of revenue from under-billing bundled services.
• Increased scrutiny during audits.

How to fix it

• Check National Correct Coding Initiative (NCCI) edits. These define what codes can and can’t be billed together.
• Use claim scrubbing software. It flags bundling conflicts before submission.
• Review payer contracts. Rules for bundling often vary by insurer.

Coders who understand bundling nuances protect your practice from both denials and accusations of overbilling.

6. Missing Medical Necessity or Supporting Documentation

Payers will only reimburse services deemed “medically necessary.” Without documentation to support that necessity, claims are quickly denied.

Why it happens

• Coders or clinicians don’t clearly link diagnosis codes (ICD-10) to procedures (CPT).
• Generic or “rule-out” diagnoses are used.
• Clinical notes lack justification for tests or procedures.

The impact

• Denied claims that require time-consuming appeals.
• Negative payer relationships and pre-payment review risks.
• Possible allegations of misuse or fraud.

How to fix it

• Link ICD-10 and CPT codes correctly. Always ensure a logical medical reason connects them.
• Educate clinicians. Physicians should understand payer definitions of medical necessity.
• Perform pre-submission checks. Automated validation tools can flag mismatched codes.

When documentation supports necessity, payers have less room to deny — and audits are less daunting.

7. Delayed or Incomplete Charge Capture

Every day a charge goes unbilled is lost revenue. Incomplete charge capture — when services rendered aren’t translated into billable codes — quietly erodes profit margins.

Why it happens

• Paper notes or missed encounters never entered into the EHR.
• Disjointed workflows between providers and billing staff.
• Manual charge capture prone to human error.

The impact

• 3–5% of total practice revenue lost annually, according to revenue cycle consultants.
• Increased days in accounts receivable (A/R).
• Discrepancies between clinical and financial data.

How to fix it

• Use digital charge capture tools. Mobile or EHR-integrated systems automate the process.
• Reconcile daily. Compare scheduled visits vs. billed encounters.
• Assign accountability. Every provider should review charges at day’s end.

Charge capture efficiency directly correlates with a healthier revenue cycle.

8. Lack of Staff Training and Continuous Education

Medical coding isn’t static — guidelines evolve, payer rules shift, and technology changes yearly. Without consistent education, your team will inevitably fall behind.

The impact

• Higher denial rates and resubmission costs.
• Coding inconsistencies across departments.
• Low staff morale when denied claims lead to frustration.

How to fix it

• Invest in ongoing training. Encourage AAPC or AHIMA certifications and continuing education.
• Host monthly learning sessions. Discuss real claim denials and lessons learned.
• Document internal best practices. Maintain a “living” reference manual accessible to all staff.

Continuous learning turns your coding team from reactive to proactive — the key to long-term stability and compliance.

9. Skipping Regular Internal Coding Audits

Audits aren’t just for compliance—they’re one of the most effective tools for improving reimbursement. Unfortunately, many practices either skip them or perform them too infrequently.

Why it happens

• Perception that audits are time-consuming or punitive.
• Lack of internal expertise.
• Fear of uncovering issues.

The impact

• Persistent coding errors go undetected.
• Higher risk of payer audits or legal penalties.
• Inaccurate reporting and forecasting.

How to fix it

• Perform quarterly audits. Rotate specialties or service types to ensure broad coverage.
• Use audit findings constructively. Turn insights into staff training opportunities.
• Track audit KPIs. Denial rate, coding accuracy rate, and A/R days should be part of your dashboard.

When audits become part of your culture, coding accuracy improves organically — and reimbursements follow suit.

10. Ignoring Technology and Automation Tools

In 2025, technology isn’t optional for efficient medical coding. AI and automation are transforming how practices code, review, and submit claims — yet many small and mid-sized practices still rely on manual workflows.

The impact

• Missed edits and preventable denials.
• Slower claim turnaround times.
• Staff burnout from repetitive data entry.

How to fix it

• Adopt coding automation tools. AI-driven solutions can flag potential errors or suggest codes based on documentation.
• Integrate claim scrubbers. These systems catch compliance and formatting issues pre-submission.
• Leverage analytics dashboards. Monitor denial trends, coding patterns, and payer performance.

The future of coding is hybrid — combining technology with trained human oversight. Practices that embrace automation now will lead in efficiency and compliance later.

How to Prevent Coding Errors Before They Happen

Mistakes will always happen, but proactive systems can keep them to a minimum.

1. Standardize Your Coding Workflow

• Use consistent templates, processes, and verification steps across all locations.

2. Conduct Regular Training

• Cross-train billing and clinical staff to understand how their actions affect claims.

3. Build a Quality Assurance Loop

• Use denial analysis to pinpoint recurring issues and feed insights back into coder education.

4. Automate Where Possible

• Implement EHR prompts, real-time validation, and automated claim scrubbing tools.

5. Communicate Constantly

• Establish coder–clinician feedback sessions. Open communication minimizes interpretation errors.

Turning Coding Accuracy into a Competitive Advantage

Every claim tells a story — and that story begins with coding accuracy. By identifying and correcting these top 10 mistakes, you’ll not only protect your practice from compliance risks but also unlock faster, more reliable reimbursements.

The difference between a claim paid in 14 days and one denied for 90 could come down to a misplaced modifier or an outdated code. As a healthcare practice owner, the key is to treat coding as a strategic priority, not just an administrative function.

Key takeaways

• Regular updates, audits, and staff education safeguard both revenue and compliance.
• Technology can enhance accuracy, but people and processes must come first.
• Continuous improvement — not one-time fixes — drives long-term financial health.

When you invest in coding accuracy, you’re investing in your practice’s stability, reputation, and patient satisfaction.

Partner with Medviz Systems to Eliminate Costly Coding Errors and Maximize Reimbursements

Struggling with claim denials, audit risks, or hidden revenue losses caused by medical coding mistakes? Medviz Systems helps healthcare practices like yours stay compliant, accurate, and profitable. Our intelligent RCM solutions combine automation, analytics, and expert insight to ensure every code is correct — the first time.

📞 Call us today at +1 (727) 214-2749 or 📧 email success@medviz.ai to discover how Medviz can streamline your coding workflows, reduce denials, and drive higher reimbursements — all while keeping your practice audit-ready and compliant.