Biggest Risks in Physician Billing in 2023

Physician billing companies know a secret – keeping on top of risks in physician billing services is one of the most effective ways to keep cash flows healthy and practices functioning at their best.

That’s why we’re going to walk you through the biggest risks to physician billing right now in 2023.

Volume and Resource Fluctuations Continue
While the worst of the pandemic-related volatility is likely behind us, physician billing will still need to adjust for unpredictability. This is because physician practices are dealing with COVID-19 challenges in addition to the waste and abuse issues that were entrenched well before the pandemic. So now physician offices are dealing with yesterday’s problems on top of longer visits, more visits for therapies and early refills, COVID-19 diagnoses, and disbursement of excess pharmacy and durable medical equipment. These things make billing volatile and complex and are why many practices are considering working with physician billing services.

And while volumes have returned to normal for many, this is only part of the story. Some payers are reporting increases in deferred care, but not quite at the rates expected, while others are seeing more than projected. Labor challenges also continue to rage on, with many practices still figuring out their approach to remote work and retention and considering physician billing companies. This is happening with both providers and payers.

These issues have contributed to an increase in payment errors and billing inaccuracies in many areas. To minimize risk, providers should be ready to address these issues both on their end and on the payer side [1].

Don’t Overestimate AI in Physician Billing Services
Medical billing has been heralded as one of the best use cases for artificial intelligence (AI) in healthcare, and for good reason. Medical billing and coding rules are constantly being changed by payers, documentation requirements are always shifting, and coders are constantly inundated with new code sets. All these issues slow down reimbursement, contributing to denials and clogging up the appeals process. AI has been hit or miss in clinical areas, but since medical billing and coding are text-centric, they could hypothetically be a perfect fit, allowing smaller teams to work on claims that are more complex than their norm.

But much of the optimism hasn’t turned into reality. Organizations who’ve stepped out early into AI have had significant growing pains, especially in terms of data quality. AI models live by the principle of “garbage in, garbage out”, so that even practices that are excited about the promise of AI are learning that they have to do significant work to assess their coding practices and making sure they’re getting highly correct information from the beginning. They also need enough data points or sets to make sure prediction models are accurate since using amounts that are too small can dilute the power an analytics technology needs for success [2].

So, while the promise of AI is on the horizon, most physician practices will need to take an honest assessment of their goals, resources, and current state of tech readiness to avoid the risk of adopting solutions before they’re ready.

Upcoding in the Age of COVID Can Cause Problems
One of the more grounded and classic risks that physician offices will face in 2023 is the problem of upcoding – a problem that, if too extensive, can trigger allegations under the False Claims Act, leading to potential audits and financial penalties.

Upcoding is simply submitting a claim with higher or more extensive medical coding than the documentation or circumstances support, usually to get higher reimbursement rates than lower codes provide. A classic example is evaluation and management (E/M) codes being billed at a higher level (such as five when documentation only supports a level two). For example, telehealth fraud was found to have increased through improper billing and upcoding during the COVID-19 pandemic. State and federal regulators had relaxed restrictions to allow increased access to telemedicine, resulting in an 11,000 percent increase in virtual appointments during the pandemic and Medicare primary care visits jumping by more than 43% in the first three months of the pandemic. But in early 2021, the Department of Justice made an announcement that it had brought in over $2.2 billion in judgments and settlements from fraud and False Claims Act cases with more than 80% of False Claims Act recoveries in FY 2020 coming from the agency resolving fraud and enforcement actions [3].

But upcoding doesn’t require direct malicious intent. A practice can be at risk of upcoding practices simply because of poor training or bringing on an employee who previously worked at a less scrupulous organization. This is why many practices work with physician billing services to level out the risk.

The Risk of Audits Continues
While connected to upcoding, it’s worth looking at audit risk on its own, even if you work with physician billing companies.

Consider that the Office of Inspector General (OIG) plans on reviewing E/M services provided by physicians in the emergency department. The agency is keeping a close eye on how physician practices are being billed in 2023. While this example is in emergent settings, physician practices should take it as a warning. It can be helpful to have someone review your claims, or you might even consider working with a physician billing company to minimize risk.

Use these points as a checklist to bump against your own processes and best practices. As you move forward, you’ll find areas for improvement, but also areas where it might be smart to start looking at physician billing companies that you can partner with to improve financial outcomes. When you’re ready to take that step, start here.

[1] S. Mantha, “Addressing 3 pandemic-induced payment integrity challenges,” Industry Dive, 30 January 2023. Available:
[2] J. LaPointe, “Medical Coding is the Next Stop for Artificial Intelligence in Healthcare,” TechTarget, Inc., 3 October 2022. Available:
[3] P. Giancola and C. Stedman, “Telehealth Fraud Triggered by COVID-19 Pandemic,” JD Supra, LLC, 16 February 2021. Available:

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