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CHAPTER TWO MEDICAL CODING, CODE ASSIGNMENT AND REIMBURSEMENT Introduction to Medical Coding Medical coding, or medical classification, is the process of transforming descriptions of medical diagnoses and procedures into code numbers that can be universally recognized and interpreted. The diagnoses and procedures are usually taken from a variety of sources
within the medical record, such as doctor’s notes, laboratory results, and radiological tests. In practice, the basis for most fee-for-service reimbursement is the patient’s diagnosis (in the case of inpatient settings) or the procedures performed on the patient (in the case of outpatient settings. Thus, a brief background on clinical coding will enhance your understanding of the reimbursement process. Medical coding, at its most basic, is a little like translation. It is the coder’s job to take something that has written one way (a doctor’s diagnosis, for example, or a prescription fora certain medication) and translate it as accurately as possible into a numeric or alphanumeric code.
For every injury, diagnosis, and medical procedure, there is a corresponding code.
Medical Coding, Code Assignment and Reimbursement There are thousands and thousands of codes for medical procedures, outpatient procedures, and diagnoses. Let us start with a quick example of medical coding inaction. A patient walks into a doctor’s
office with a hacking cough, high production of mucus or sputum, and a fever. A nurse asks the patient their symptoms and performs some initial tests, and then the doctor examines the patient and diagnose bronchitis. The doctor then prescribes medication to the patient. The doctor or someone in the healthcare provider’s office records every part of this visit.
It is the medical 2 coder’s job to translate every bit of relevant information in that patient’s visit into numeric and alphanumeric codes, which can then be used in the billing process.
There area number of sets and subsets of code that a medical coder must be familiar with, among the popular codes are the but for this course
we will focus on two the International Classification 
