Medical Coding Staff Issues Lead to Reimbursement Bottlenecks and Other Problems: Article

April 1, 2021
April 1, 2021

This blog post excerpts a recent article, “Code Red: Medical Coding Staff Issues Can Create Reimbursement Bottlenecks and Other Problems,” by Joe Morris, HealthStream Contributing Writer.

In patient care, even when a problem is clear, the solution can often be difficult to pin down. The same is true of healthcare as an industry. Shortfalls in key staffing areas such as coding can create havoc on business operations and efficiency as fixes prove elusive.

Like the ongoing nursing shortage, the coder problem looks different, not just between regions or states, but even down to communities. The availability of talent is a concern, as are training programs, salaries, and other elements that HR departments face all the time. And the solution? Like patients, it’ll be unique to every situation.

The issue isn’t new. Upwards of a decade ago, industry-watchers were warning of impending issues in healthcare IT departments. We now have an ongoing shortage of qualified coders, simultaneous with major emerging trends that complicate this area of healthcare. A rising senior population is requiring more in- and outpatient care. Changes wrought by the Affordable Care Act and ongoing tinkering there by Congress should necessitate more coders in general—as well as more highly trained, specialized personnel within their ranks. At the same time, in 2013 the average age of coder was estimated to be 54, which meant a looming retirement wave was coming when it could be least afforded (Wirth, 2013).

Supply, demand and payroll realities

In many locations these conditions have created a shopper’s market for coders, especially those with plenty of experience and a varied skill set. These high-value hires have specific salary demands, which can run afoul of the C-suite’s desire to keep labor costs in specific lanes in order to offset declining reimbursements and increased competition.

Those financial numbers paint a stark picture—according to some forecasts, by 2024 commercial payments to hospitals and health systems will drop from 37 to 33 percent, while Medicare payments will rise from 30 to 40 percent. Reduced reimbursements and fiscal decline will come at a time when labor, already an estimated 60 percent of noncapital costs for hospitals, will likely continue to be the largest driver of operating expenses (Korenda, 2018).

At the same time, medical coding has become one of the 20 fastest growing occupations in the United States, expected to rise by 15 percent from 2014 to 2024, or 29,000 new jobs, according to the U.S. Bureau of Labor Statistics (3M, 2017).

Further complicating the picture is the recent adaptation of ICD-10, an updated set of codes to report diagnoses and patient procedures. ICD, or the International Classification of Diseases, coding was introduced in the late 1970s, and the more detailed ICD-10 replaced ICD-9 on Oct. 1, 2015. The codes form the foundation, not just of recording and identifying health conditions for study and predictive analysis, but also for insurance and government payment and reimbursement. And while the update was overdue and necessary, it made the coder’s job significantly more complicated by more than quadrupling the number of new codes from 14,000 to 70,000, which meant an immediate hit to speed, efficiency, and accuracy (Weldon, 2015).

The article concludes by looking at education and training as an important solution for the healthcare coding staffing crisis. Read the full article here.


3M. (2017). “Navigating the coder shortage: The current state of medical coding,” Retrieved from

Korenda, L. (2018). No sick days, no collars: How tech might help hospitals shrink labor costs. Retrieved April 27, 2018, from

Weldon, D. (2015). Hiring woes persist as ICD-10 coders tough to find. Healthcare IT News. Retrieved April 28, 2018, from

Wirth, P. (n.d.). Addressing Coder Shortages From Within. For The Record. Retrieved April 27, 2018, from

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