What Is Involved in Inpatient Coding?

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  • Written By: Susan Abe
  • Edited By: Jessica Seminara
  • Last Modified Date: 02 December 2019
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Inpatient coding refers to the review of hospital patients' medical charts in order to capture all diagnoses rendered and all prescribed medications, tests, treatments, equipment and supplies in order to maximize the hospital's reimbursement from health insurance carriers. In Western medicine and particularly in the US, all medical diagnoses are coded by number as established by the International Classification of Disease Manual (ICD-9) and all possible medical treatments — from an ice pack to open heart surgery — are coded by number per the American Medical Association's (AMA's) Current Procedural Terminology (CPT) Manual. Inpatient coding involves review of an inpatient's paper chart or electronic medical records and conversion of diagnostic and treatment information into appropriate codes. Medical insurance companies — driven by Medicare and Medicaid — use ICD-9 diagnostic codes to establish expected lengths of inpatient stays, while secondary diagnoses and treatment codes may justify payment for additional inpatient days. Inpatient coding also involves double-checking that a hospital's internal billing charges for medical supplies and medical appliance usage are accurate.


Specialists in inpatient coding often scan physician progress notes and consultation reports in inpatient charts for new or unreported diagnoses. Coders also review physician order sheets to confirm that prescribed medical equipment — such as ventilators, intravenous (IV) pumps or cardiac telemetry monitoring — is charged daily to the hospitalized patient's account while in use. Individual medical supplies necessary for patient care are often the most difficult to accurately count and bill as most aspects of the process remain a time-consuming, paper and sticker system. Inpatient coding specialists often compare what is documented as used in the physician or nursing notes against what labels are attached to a patient's index card or scanned by barcode to a patient's account and then correct any discrepancies. Due to the time it takes, this process is best used for trauma patient charts or other instances when the medical and nursing staff are focused less on obtaining a medical supply item's identifying sticker and more on necessary patient care.

There is a significant amount of education and training required to perform the work of inpatient coding. Most medical record coders have completed an associate's degree as a medical records technician or a health information technician and then received additional training to specialize in medical coding. Professional coding organizations, such as the American College of Medical Coding Specialists (ACMCS) and the American Association of Professional Coders (AAPC), offer membership, training, continued education and credentialing by examination. The outlook for inpatient coding jobs is very positive, with continued above-average job growth anticipated in the future.


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