3 medical coding myths that hold practices back

Practices need better than "good enough" medical coding

Healthcare leaders face major challenges that consume resources and compete for priority.

Nearly all (90%) of medical practices reported higher operating costs in 2025 than in 2024.¹ Reimbursement shifts from Medicare and Medicaid, plus new commercial payer dynamics, are adding to the financial pressure. Labor shortages are also ongoing — and not just for clinical roles — making these financial challenges even more pressing in a short-staffed environment.

With these bigger concerns at play, practices often find that repeatable workflows like medical coding get stuck in a “good enough” rut. That happens for understandable reasons, of course. Leaders don’t have the luxury of time to rework processes that, as they see it, are already working just fine.

But medical coding itself is a high-stakes field with real financial implications. And in a new era of claims scrutiny and denials, now is not the time to be complacent in revenue cycle management. Across the healthcare system, the cost of claims follow-up is significant. In 2025, hospitals specifically spent $43 billion chasing unpaid claims.² While individual practice economics will vary in scale, the same underlying pressure applies, with preventable claims issues consuming time, staff capacity, and revenue cycle resources.

If leaders aim to fend off that financial risk, they may need to rethink their approach to coding workflow optimization. It's very likely that prevailing myths and outdated coding practices could be holding them back. For the sake of healthcare practice efficiency and operational excellence writ large, let’s clear up those misconceptions now.

Myth 1. Coding is easily transferable to providers and others

With ongoing labor shortages, healthcare practices often ask teams to wear multiple hats. When they assume medical coding is a transferable skill, staff members, such as clinicians, may take on coding tasks as needed, even when it’s not their full-time responsibility.

But medical coders do indeed have specialized expertise. Translating a complex patient journey into claims requires contextual knowledge. You have to be fluent in clinical guidelines. But you also have to be fluent in a universe of other things, including diverse payer expectations and policies, billing conventions, and administrative minutiae.

Moreover, coders are trained to review encounters more holistically. They take a macro perspective to capture classifiable details that are pertinent not only to the patient’s care but also to the chart, the claim, and other outputs.

And it’s not just the coder and their skills at work. Optimized coding workflows require an entire backdrop of documentation, technology, and process support. These supporting factors account for payer and regulatory requirements and help define how coding should be performed consistently and accurately for each patient encounter.

Suffice it to say, these requirements all make coding a specialized function that’s not so easily transferable to others in a pinch. Especially to clinicians, whose time is best focused on patient care.

Myth 2. Undercoding leads to lower audit risk

Fully aware of the compliance risks of overbilling for services they didn’t provide, some practices may undercode, whether because of documentation gaps, workflow issues, coder caution, or an internal decision to select a lower-level code. In general, undercoding means the submitted codes do not fully reflect the documented services provided, which often results in lower reimbursements.

It’s understandable why some medical practices make this mistake. They’re worried about raising suspicions and may assume that undercoding helps stave off denial or audit risks. But, in fact, neither undercoding nor overbilling is appropriate from a coding and audit compliance perspective.

That’s because undercoding undermines coding integrity and accuracy and, as with overcoding, poses a compliance risk. It's very common for patterns of coding that appear inconsistent with documentation, payer requirements, or peer benchmarks to invite closer review.

Additionally, choosing to undercode means being undercompensated for the work performed. With undercoding, practices stand to lose millions in revenue. One study estimated that the aggregate annual losses from undercoding in many primary care practices across Flroida alone was $114 million.³

There are also clinical implications of undercoding, including issues with documentation integrity. This can make providing patients with proper care challenging because clinicians may lack the full context of past encounters.

Overall, undercoding also creates systemic problems for the entire healthcare ecosystem. Claims data can be used to inform research, quality analysis, population health insights, and real-world evidence. When coding is inaccurate at scale, those datasets may offer an incomplete picture of care patterns, disease burden, or treatment decisions.

Despite this, undercoding happens in up to 45% of outpatient visits.³ Clearly, its supposed benefit is a myth that deserves a closer look.

3. A strategic coding overhaul costs too much

Many practices are reluctant to embrace operational shifts in workflows such as medical coding. The underlying assumption is that these overhauls take time, money, and people away from other priorities. And after years of allocating budget toward digital transformation initiatives, that perspective makes sense.

But if you think your practice can’t afford to invest in a more effective medical coding strategy, consider instead whether it can afford not to.

Coding errors lead to lost revenue downstream, as reflected in the $114 million figure seen in primary care practices across Florida. Compliance penalties can exacerbate those risks. Take one notable case in which a psychiatrist’s office billed for 30- or 60-minute sessions that actually lasted 15 minutes. He was fined $400,000.⁴

But aside from the overt losses in uncaptured revenue and penalties, there’s also the opportunity cost. In the case of the overbilling psychiatrist, that provider was banned from participating in Medicare. Consider this impact: The provider lost the opportunity to collect reimbursement from the biggest payer in the United States.

Lastly, modern medical billing software creates more cost-effective opportunities than ever to transform coding workflows. These tools, like athenaOne®, leverage automation in a way that is designed to support efficient and accurate coding, which can help practices the risks of coding errors associated with manual workflows while freeing up teams to take on other tasks.

Challenge assumptions for more accurate coding

If you’re a healthcare leader, you’re probably dealing with a lot right now. In a complex and strained care ecosystem, medical coding myths can flourish.

But coding workflows deserve the same scrutiny as any other operational processes tied to revenue, compliance, and performance. Even if workflows appear to be working well enough, a closer and more careful look might indicate otherwise.

So consider assessing your coding practices to find ways to improve. By challenging assumptions and embracing technology, many healthcare leaders have retooled their medical coding strategies to support more accurate coding and more consistent revenue cycle processes.

athenahealth can help. athenahealth has extensive experience working with diverse practices and has witnessed firsthand how outdated coding beliefs limit practices’ potential. This expertise comes from helping practices across the country transition from myth-based decision-making to data-driven coding optimization, giving us unique insights into what actually works.

Learn how athenaOne's practice management software and medical coding services can help your practice move beyond outdated coding practices.