Inpatient Coding and Outpatient Coding System - Medical Billing & Coding

Medical billing and coding is a complex system considering the complexity of the hospital environment. Hundreds of individuals are employed at the healthcare facilities to ensure everything in the billing process to be systematic and well-organized.

Medical billing and coding serve a number of purposes like retrieving information and reporting the same on the basis of diagnosis and procedures involved. More complex than the coding part is the documentation process.

The medical records pertinent to the medical procedure are the foundation for a successful coding process. The documents contain complete information regarding the patient health condition, the history of his treatment, progress so far and the medications that he/she is prescribed with their quantity. It is the role of a certified medical coder to carefully review the medical records and then assign codes to their diagnosis.

Medical coding is a process of assigning codes to the healthcare data elements of outpatient and inpatient care. Therefore, one of the most important aspects of medical coding process is to identify if the patient is inpatient or outpatient.

inpatient coding vs outpatient coding

Inpatient Coding System

A patient who is formally admitted to a hospital upon the orders of the physician for a long period of time. This coding system is used to report patient diagnosis and services based on their extended stay. The ICD 10 HCPCS coding system is utilized for obtaining appropriate reimbursement.

Outpatient Coding System

An outpatient refers to a patient who is being treated but not actually admitted at any healthcare facility for an extended period of time or is released from the hospital within 24 hours. Outpatient coding is based over ICD 9 or ICD 10 diagnostic codes but uses CPT or HCPCS system to report medical procedures.

Comparison between Inpatient and Outpatient Coding

Outpatient coding is based on a detailed diagnosis report in which the patient is generally treated in one visit, whereas an inpatient billing and coding system is used to report diagnosis and treatment procedures based on a patient’s extended stay.

The inpatient system is based on the assignment of ICD 9/10 CM diagnosis and procedure codes for billing and claim reimbursement. It is a standard coding system used by physicians and other medical healthcare providers for classification and coding for all the diagnoses.

The principal diagnosis is defined as the condition established initially after the checkup and is described as the only reason for admitting the patient under the care of a hospital. During coding, the principal diagnosis is placed first. The correct assignment of principal diagnosis code is important as it determines whether the payment will be made or not. Failure to use it as required may invite unnecessary denials. This method is generally used in cases of outpatient services.

For inpatient services, an (IPPS) Inpatient Prospective Payment system is used as the reimbursement methodology by health insurance payers to provide reimbursements.

In the nutshell, the groundwork remains the same but the coders need to keep up with the changing hospital coding guidelines. The hospital facilities offer a host of settings the involve submitting claims for the services without any sort of error. Inpatient coding becomes different from the outpatient facility in terms of approach, guidelines, and payment system etc.

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