How do you perform an internal audit on medical coding records?
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How to Perform an Internal Audit on Medical Coding Records
If you're a student in a medical coding course, understanding audits isn’t just theory—it’s essential for ensuring quality, avoiding errors, and ultimately becoming a trusted coder. An internal audit of medical coding records is a structured review of coded medical documentation to detect errors, ensure compliance, and improve accuracy. Below are steps, related statistics, common pitfalls, and how Quality Thought can help you grow in this area.
Why Internal Audits Matter (with Statistics)
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In some studies, the average coding accuracy for inpatient cases was 55% in 2016, rising only to 61% in 2017—showing that many cases had errors.
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One study found that 26.8% of primary diagnoses were coded inaccurately, and additional diagnoses were also often missed.
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Coding errors are responsible for a large fraction of claim denials. Studies show that 15–20% of claims are denied due to improper coding.
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Internal quality assurance audits in some organizations reach 95–98% accuracy rates after implementation of strong audit and revision protocols.
These numbers show two things: (1) even in “real world” settings, error rates are significant, and (2) with systematic auditing and improvement, high accuracy is achievable.
Steps to Perform an Internal Audit on Coding Records
Here’s a step-by-step process you might follow in your course or in practice:
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Define the Purpose and Scope
Decide what you're auditing: inpatient vs outpatient, specific service types, certain coders, or certain payers. -
Set Clear Measurement Criteria
Use accepted standards (ICD-10, CPT, documentation guidelines, payer policies). Define what counts as error (missing diagnosis, incorrect modifiers, wrong principal diagnosis, etc.). -
Select Sample Size and Records
Choose representative records. A good audit includes enough records to find patterns, not just isolated mistakes. -
Gather Documentation and Data
Collect medical records, physician documentation, lab reports, operative reports, etc. Also collect coded claims, coder notes. -
Review and Compare
Match documentation to what was coded. Look for inconsistency: missing detail in docs, wrong code choice, missing modifiers, overcoding or undercoding. -
Record Findings
Log types of errors, frequency, severity (how much revenue or risk is involved), coder performance, documentation quality. -
Analyze the Data for Patterns
Identify if errors are due to insufficient documentation, coder knowledge gaps, misunderstanding of guidelines, or system issues. -
Provide Feedback and Training
Give coders constructive feedback. Use findings to plan targeted training or refresher sessions. -
Implement Changes
Update internal coding policies, documentation templates, maybe software supports or peer review. -
Re-audit / Follow up
After changes, perform follow-up audits to see if error rates fall. Continuous auditing helps maintain high standards.
Common Challenges & Pitfalls
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Poor documentation by physicians or staff makes coding hard.
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Constant updates in codes (ICD, CPT) and payer rules — coders who are not current may make errors.
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Overlooking modifiers or secondary diagnoses.
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An audit performed only once vs continual auditing: continual audits reveal trends.
How Quality Thought Comes In
At Quality Thought, we emphasize that “quality” is not a static target but a mindset. In your medical coding course, we integrate internal audit principles early—so you learn not just how to code, but how to verify, correct, and improve. We teach you:
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How to document correctly so coding is easier
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How to interpret and apply the latest coding guidelines
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How to develop skills in auditing (identifying errors, using checklists, interpreting results)
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Exposure to sample internal audits and case studies
By doing this, we prepare you to enter the workforce not just as a coder, but as someone who contributes to coding quality, reducing denials, improving revenue cycle management, and compliance.
Conclusion
An internal audit of medical coding records is a powerful tool: it shines a light on errors, guides quality improvements, supports compliance, and ultimately helps healthcare providers and patients. For students in a medical coding course, mastering auditing means you’re not just learning to code—you’re learning to ensure that coding is reliable. Through Quality Thought’s training, audit methodologies are woven into your learning so you graduate ready to deliver high accuracy, quality-driven work. Are you ready to apply internal auditing in your next coding assignment?
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