Since 2004, hospitals and other providers are paid based on the work they do. This in turn is largely based on the “Office of Population Censuses and Surveys” codes (OPCS) and the “Health Care Resource Group” (HRG) codes.

Audits have proven that inaccurate coding can lead to significant clinical and financial implication. Through our clinical audit works, we have assessed the current coding practices and examined potential financial shortfalls.

Fifty five arthroscopic shoulder procedures were performed over a five-month period. All case notes were retrieved and the clinical correct OPCS and HRG codes were recorded. Those were then compared with the OPCS and HRG code which were documented independently by the clinical coding office. The difference between the predicted costs and the hospital’s actual costs was evaluated.

The result was as follows: 81% of the arthroscopic shoulder surgery was inappropriately coded. Due to the fact that the HRG code is largely based on the OPCS code, a significant proportion was wrongly recorded. Secondary to the OPCS code, the HRG was inaccurately coded in 85% of the cases. If all procedures were coded accurately, the revenue generated would be £124,519. Due to inaccuracy of our coding practices, over £50,000 was unaccounted.

The real difficulty in the coding practice lies in the ability of choosing the most appropriate code for a particular surgery, and in many cases it requires the user to use multiple codes to correctly categorize the operation. Our current coding practice is extremely poor and as a result the hospital is losing a significant amount of money. A more accurate coding can generate additionally £50,000 in revenue for arthroscopic shoulder surgery alone. The significance of coding errors across all specialties must not be underestimated.