Case Study: Recovering $120K by Fixing Coding Errors in Plastic Surgery Billing

A Leading high-volume plastic surgery clinic in Chicago was losing revenue due to persistent claim denials, underpayments, and delayed reimbursements. The root cause? Ongoing medical coding errors that had gone undetected in their billing process.

That’s when they partnered with MBW RCM—plastic surgery billing and coding services. Within just 90 days, MBW RCM identified and corrected key coding errors that had gone unnoticed—ultimately helping the clinic recover over $120,000 in lost revenue and bring stability back to their billing system.

Client Overview

• Location: Chicago, Illinois

• Specialty: Plastic and Cosmetic Surgery

• Monthly Patients: ~180

• Monthly Revenue Volume: $350,000

• Monthly Collections (before): $245,000
  

Despite a consistent flow of patients and high-value surgical procedures, the clinic was falling short on collections. A detailed review revealed that a major portion of the revenue gap was caused by persistent coding errors—including incorrect CPT and ICD-10 usage, unbundled procedures, and modifier mistakes. These issues led to frequent claim denials and underpayments, preventing the clinic from capturing full reimbursement for services rendered.

The Key Challenges in Plastic Surgery Billing Services

1. Incorrect Use of CPT and ICD-10 Codes

   Using inaccurate or outdated procedure and diagnosis codes can lead to claim denials or reduced payments. In plastic surgery, the distinction between similar procedures is subtle, and miscoding often results in insurance rejections or audit risks.

2. Confusion Between Cosmetic and Medically Necessary Procedures

   Failing to clearly differentiate between cosmetic and reconstructive procedures can cause denied claims. Insurance typically doesn’t cover cosmetic work, so coding must reflect medical necessity and be supported by documentation.

3. Unbundling of Procedures

   Billing separately for services that should be combined under one code is a common error. This can lead to overpayments, compliance issues, and payer audits, especially in surgeries involving multiple steps.

4. Upcoding or Downcoding Errors

   Assigning codes that misrepresent the procedure’s complexity—either too high or too low—can lead to penalties or lost revenue. Accurate coding depends on clear documentation of what was actually performed.

5. Mismanagement of Modifiers

   Incorrect or missing use of modifiers (e.g., -59, -25) can lead to underpayment or denial of claims. Modifiers clarify billing in complex or multiple-procedure cases, making their proper use essential in plastic surgery billing.

Our Strategy

To recover the lost $120K, MBW RCM conducted a full-scale audit and implemented targeted solutions. Each fix was designed to address recurring coding and billing problems in the plastic surgery practice:

Problem	What We Did
Incorrect Coding	Our certified coders audited 100% of claims over a 90-day period and corrected CPT/ICD-10 codes based on op notes and payer policies. This reduced coding-related denials by 42% within two months.
Cosmetic vs. Medically Necessary Confusion	We worked with providers to update documentation templates and added pre-checks to verify medical necessity, increasing approval rates for reconstructive procedures by 35%.
Unbundling of Procedures	We flagged and corrected over 150 improperly unbundled claims and trained staff on proper CPT bundling using CCI edits. This eliminated 95% of unbundling-related denials.
Upcoding/Downcoding Errors	A QA review of 500 past claims revealed a 17% error rate; we recalibrated code selection based on op report details and reduced audit risk while recovering over $28K in missed revenue.
Incorrect Modifier Use	We deployed claim scrubbers with modifier validation and conducted workshops on modifier use. As a result, modifier-related denials dropped by 60%, and reimbursement rates improved across multi-procedure claims.

Results: What Changed in Just 3 Months

• Recovered $120,000+ in lost revenue tied to coding mistakes

• Claim denials due to CPT and ICD-10 errors dropped by 38%

• Modifier and CPT code corrections sped up reimbursements by 27 days

• Billing rejections from unbundled or misused codes fell by 40%

• Monthly collections increased by 15% through cleaner claims

Fixing medical coding errors not only recovered lost revenue but also reduced administrative burden—allowing the clinic’s staff to focus more on patient care instead of dealing with insurance claim issues.

Conclusion

For this Chicago-based plastic surgery clinic, the impact of correcting coding errors was both immediate and substantial. Systematic issues in CPT, ICD-10, and modifier usage had gone unnoticed for months, quietly undermining revenue performance. 

By conducting a targeted audit and implementing precise coding corrections, MBW RCM helped the clinic recover over $120,000 and restore consistency to their billing cycle. With deep expertise in revenue cycle management and a focus on execution, our team delivered measurable results—quickly and effectively.

Is Coding Errors Draining Your Practice Revenue?

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