Protecting our pay against downcoding is a top issue for family medicine

Insurance downcoding example

A typical example of downcoding is when you see one of your established patients to manage multiple chronic conditions. You bill the usual 99214 moderate-complexity code for that office visit, but the payer downcodes that encounter to a 99213.

It is that simple and subtle: You are getting paid less for your work, and you know from your history with that patient that you have been compensated correctly in the past.

Why insurance companies are downcoding

Downcoding is legal—but that does not mean the practice is transparent or applied fairly.

It is an evolution of coding integrity programs, which, while commonplace, were far from perfect to begin with. The change is that insurers are using AI to reduce their costs by reviewing claims in bulk and evaluating physicians’ billing codes with algorithm-generated criteria.

Downcoding is on the rise following years of scrutiny and advocacy by the AAFP and others to combat prior authorization and other administrative burdens. That pressure seems to have led payers to make some processes more opaque. Downcoding has been framed as a business decision, but we do not have enough visibility into how coding decisions are made.

Why downcoding creates problems for family physicians

I am seeing downcoding more often, and I agree with what the AAFP told policymakers last fall: It threatens family medicine practices.

Downcoding keeps physicians from being compensated fairly for the work that we have done. The process of downcoding fails to recognize the complex, longitudinal care that our specialty delivers to our patients every day. It is increasingly difficult to run a primary care practice. Costs are going up, reimbursements are going down and margins remain thin. This is a significant issue and we cannot afford this additional pressure.

We also cannot afford to devote clinical time to clerical tasks of catching and correcting downcoding. For many of us, especially in independent practice, downcoding adds administrative complexity to already full days.

Downcoding does not spare employed physicians. Many employed physicians are paid on a relative value unit (RVU) model. Downcoding will reduce the amount of RVUs, which in turn reduces reimbursement and affects compensation, bonus structures and performance evaluations.

Another concern is that physicians worn down by this new burden may start to undercode or do so more than usual. Family medicine is a complex specialty, and our patients are complex. Downcoding is a good reminder of a basic tenet: If you have done the work and documented the work, you should bill appropriately for that work.

How to spot and push back on downcoding

It’s more important than ever to understand your billing and monitor it.

My billing team is getting better at keeping their eyes open for downcoding, and they are quick to resubmit if something is not paid correctly. I also keep track of higher-level codes that might be subject to downcoding, so I can verify that they have been paid accurately.

We need to zero in on the right data and go beyond looking only for denials. The problem here is not an insurer saying no; it is that your claim has been paid with an incorrect amount.

AAFP advocacy on downcoding and Cigna’s downcoding pause

I serve on the executive board for the Texas Academy of Family Physicians and as vice chair of the Council on Socioeconomics at the Texas Medical Association. Downcoding is a hot topic in both of these groups. Awareness, concern and frustration are growing, and so is advocacy to stem downcoding.

The Academy has reached out to payers, insurance trade associations and federal agencies, emphasizing the problems created by the lack of transparency and appeals processes in downcoding, as well as its substantial negative economic impact on primary care.

Our advocacy is part of a wave that’s getting results. Following pressure from the California Medical Association (echoing a letter from the AAFP to Cigna), regulators in that state are looking into Cigna’s health care downcoding. The company has paused the policy in California for now, and other payers are starting to put appeals processes back in place.

There is more to do, and it is going to take effort on all our parts to elicit meaningful change.

Tina Philip, DO, a member of the Texas AFP, is a solo family physician in Round Rock, Texas.